Dive Brief:

• BP CFO Murray Auchincloss is stepping into the role of interim CEO of the oil and gas supplier, replacing Bernard Looney who has resigned effective immediately, the London-based company said Tuesday.

• Looney’s abrupt resignation occurred after he failed to disclose past personal relationships with work colleagues, according to a press release. “The Company has strong values and the Board expects everyone at the Company to behave in accordance with those values,” the release said. “All leaders in particular are expected to act as role models and to exercise good judgment in a way that earns the trust of others.”

• The scandal may provide an opening for Auchincloss, who has served at BP for over two decades, to secure a permanent CEO appointment, according to Shawn Cole, president of executive search firm Cowen Partners. “CFOs are being named CEOs with greater frequency, and I think it’s because the role has been elevated from accountant to strategic business partner in the eyes of many boards,” Cole told CFO Dive in an email.

Dive Insight:

While still rare, CFO-to-CEO promotions are on an upward curve, as previously reported by CFO Dive.

Those coming directly from a CFO seat made up 7.9% of sitting CEOs in 2022, according to executive search firm Crist Kolder Associations’ 2023 Volatility Report, compared to 6.6% in 2020. Of that figure, 7.2% were internal company hires.

AMC Networks’ Christina Spade made a CFO-to-CEO move within the company last year, ultimately stepping down after only three months in the chief executive’s chair. At the time, the company provided no explanation for her exit.

CFOs who want to be seen as future CEOs need to avoid falling into the trap of remaining focused on cutting costs rather than growing top-line revenue, according to Cole. “Like it or not, internal interims are in a try-before-you-buy scenario, and a lot of CFOs-turned-CEOs fail at this transitionary phase because they try to do both jobs at once,” he said.

A 2022 Spencer Stuart report found that only 8% of CFOs-turned-CEOs steered their organizations to the top quartile of performance.

If Auchincloss wants a shot at becoming a permanent CEO, a key step will be learning to lean more heavily on the senior finance leaders who directly report to him, Josh Crist, co-managing partner at Crist Kolder, said in an email.

“He’s going to have to put additional responsibilities on the shoulders of his direct reports during this time,” Crist said. “If he has built a strong function, and the business knows it, he’ll have no problem shifting some of those responsibilities down.”

Auchincloss assumed the CFO role at BP in March 2020 after serving in various leadership positions at the company, including finance chief of its upstream business.

Looney’s career at BP spanned more than three decades, according to his LinkedIn profile. He became CEO in February 2020.

In May 2022, BP’s board received and reviewed allegations — with the support of external legal counsel — related to Looney’s “conduct in respect of personal relationships with company colleagues,” the Tuesday release said. The information came from an anonymous source, it said.

During that review, Looney disclosed a “small number” of historical relationships with colleagues prior to becoming CEO. At the time, the company found no breach of its code of conduct.

However, further allegations of a similar nature surfaced recently, and the company immediately launched an investigation with the support of external legal counsel — a process that is still ongoing, according to the release. 

Looney informed the company “that he now accepts that he was not fully transparent in his previous disclosures,” BP said. “He did not provide details of all relationships and accepts he was obligated to make more complete disclosure.”

No decisions have yet been made regarding potential remuneration payments to Looney, the company said.

Editor’s note: CFO Dive’s Grace Noto contributed to this story.