Good morning.
Are CFOs effective interim CEOs? It may depend on how strategic they are. One particular example in the spotlight right now is at the British energy giant BP.
Last week, BP named Murray Auchincloss, the company’s CFO since July 2020, interim CEO. Today, BP announced that Kate Thomson will take on the role as interim CFO. Thomson is the first woman in that role at the company. She's currently BP's VP of finance for production and operations. Thomson has worked at BP for 19 years, previously holding several senior financial roles, including group treasurer and head of group tax.
"Kate’s experience and skills make her ideally suited to take on the role of interim CFO. She brings deep technical knowledge together with a detailed understanding of BP," Auchincloss said in the announcement.
Additional major oil and gas companies where women are finance chiefs include Exxon Mobil SVP and CFO Kathryn A. Mikells, since 2021, and Shell plc CFO Sinead Gorman, since 2022.
BP's C-suite shakeup follows the announcement on Sept. 12 that CEO Bernard Looney resigned from the company. An investigation found Looney had personal relationships with colleagues prior to becoming CEO in February 2020, according to the company. Looney admitted that he wasn’t transparent about the relationships. However, BP said that “no breach of the company’s code of conduct was found.” Looney joined BP in 1991 as a drilling engineer and spent his career at the company. A decision hasn’t been made yet regarding payments to his compensation, according to BP.
Auchincloss, now interim CEO, a native of Canada, began his career as a financial analyst at Amoco. He started working at BP in 1998 after the two organizations merged. He's had several financial leadership roles during his tenure.
CFOs as interim CEOs
The “strategic CFO” can be an “excellent fiduciary as an interim,” says Shawn Cole, executive recruiter and president of Cowen Partners, an executive search firm specializing in the C-suite. “But it really depends on the CFO, how they are viewed by the board, and if they’ve earned the title ‘strategic business partner.’ Many companies still perceive their CFO as ‘chief accountant,’ in which case they may not be considered as interim.”
“Some industries have seen a CFO step into the role of interim CEO, however, upon completion of the term, stepped back into the role of CFO,” says Alyse Bodine, global managing partner of the Financial Officers Practice, Heidrick & Struggles. Some roles the firm sees being sought after for interim CEO include chief strategy officer, COO, and chief commercial officer, Bodine says.
I contacted BP and a representative confirmed the company is conducting an external search for a permanent CEO. The representative also said BP doesn’t have a timeframe in which they’ll appoint a new chief executive. That means Auchincloss may be at the helm of the company's strategic initiative for some time.
Looney had plans for a net zero energy transition by 2050. BP aims to cut emissions from the carbon in its oil and gas production by 20%-30% by 2030. (That's a downgrade from an earlier target of 35%-40%.) The company also had plans for an increased investment in oil and gas projects up to $8 billion by 2030.
Auchincloss told staff in a town hall meeting that the company’s goals were unchanged, Reuters reported. “Our strategy hasn’t changed. And our focus remains on performance—quarter by quarter,” he said.
Sheryl Estrada
sheryl.estrada@fortune.com
