BP CEO Bob Dudley could probably use a pep talk right about now. The embattled chief, who took over after the board booted the hapless Tony Hayward, will face hostile shareholders at the company's first annual meeting since the Gulf oil spill. Their demands are simple enough: They'd like to know how BP plans to turn the company's fortunes around and keep its workers alive and uninjured. Dudley is a prince compared to other CEOs.
There's probably little risk of him jetting off to Thailand for a luxury vacation amid the company's financial turmoil or choosing a yacht race over pressing company matters. Still, Dudley looks like he could brush up on his game. Here are some thoughts:
1. Don't point fingers or make excuses
OK, so you've failed miserably and your job's on the line. Now you've got some angry shareholders to contend with. You might be tempted to make excuses or shove it off onto someone else. Take a lesson from your predecessor Hayward, who just couldn't help blaming everyone else, and do the opposite.
2. Have a plan and explain it in detail
Sounds basic enough. But it's an obvious approach that CEOs and other top execs often fail to take -- either because they don't really have a plan or they're allergic to disclosure. And right now, a primary complaint from BP shareholders is that there doesn't seem to be a detailed plan to improve safety and fix the company.
Christus Health and nine other institutions plan to vote against approval of BP's annual report at the meeting because it doesn't provide specifics of the company's safety improvement efforts, the Houston Chronicle reported. Calpers, the biggest U.S. pension fund, has said it would vote its 60 million BP shares against the annual report over the same "lack of details" complaints.
3. Be prepared to back up those answers with action and evidence
Shareholders are like elephants. They won't forget all that fancy talk of a plan, if there aren't results come next year. So whatever plan you put out there, make sure any performance or operational goals can be achieved within a year. And better yet, make sure the company can make some progress every quarter. If not, you'll constantly be dogged and distracted by impatient investors.
4. Don't champion something as "historic" for the company's future if it's not a sure thing
Unfortunately, Dudley is already headed down this path. Less than four months into his tenure, Dudley crafted a plan for BP's future in a landmark share swap and Arctic exploration deal with Russia's state-owned oil company Rosneft. The deal has been troubled ever since.
Dudley underestimated the risk, which is a surprise considering he's come out on the losing end with Russia before. Dudley was the president and CEO of TNK-BP -- a joint venture with a group of Russian oligarchs known as AAR -- until he famously had to leave Russia in July 2008 when arguments over the company's direction led to the non-renewal of his visa.
This time around Dudley assumed AAR wouldn't dare meddle in a deal blessed by the Kremlin. He made the wrong bet. Not only did AAR react, it successfully blocked the Rosneft venture with an injunction. Now this "historic" Rosneft deal is on the verge of collapsing. A deal gone awry is never easy. It's worse when it's been sold
Photo from Flickr user Robert Couse-Baker, CC 2.0