The low hanger of the ExCeL building – the London Exhibition Centre – squats grey and devoid of windows on the northern quayside of the former Royal Victoria Dock which was closed and privatised in 1981. Despite having visited this hall for most of the BP Annual General Meetings of the past decade, the place is still disorientingly ‘place-less’. An abstract space, which like so much of the rest of the Docklands, seems removed from its location on the former marshes of Plaistow that stretched south to the Thames. There is a plaza in front of the entrance to ExCeL, which looks public but is in fact entirely private. Use of this space by any citizen is ultimately at the discretion of the landowners, the Abu Dhabi National Exhibitions Centre company. This corporation generates its profit from hiring out parts of the venue to clients such as BP. It is not in their intrests to allow anything to happen in this ‘public space’ that might offend their customers, or prompt the latter to look elsewhere to hold their events. They will be eager to ensure BP holds its next AGM here too.
Reaching the plaza on this bright April morning I can see that clusters of figures have gathered. There’s an action underway protesting about the continued pollution in the Gulf of Mexico, for it is just four days to go before the fifth anniversary of the Deepwater Horizon disaster of April 20th 2010, which devastated the ecologies and communities of the southern coast of the USA. It’s organised by an alliance of the groups CoResist, Bridge the Gulf and UK Tar Sands Network. There are a few journalists and photograhers around and a presence from the Metropolitan Police. Clearly on this patch of the ExCeL estate dissent is tolerated, but carefully managed. A lighter touch than that experienced by those that question the home state of the owners of London’s ExCeL. Five months ago, in November 2014, Amnesty International released a report that showed the United Arab Emirates, of which Abu Dhabi is a part, have mounted “an unprecedented clampdown on dissent”, with more than 100 activists jailed or prosecuted since 2011.
BP AGMs were held at the Royal Festival Hall from the mid 1990’s to 2005. A venue in the centre of London. A real public space, publically owned. The move to a zone away at the edges of the city, owned by a private corporation seems to echo the way in which one of the UK’s most powerful companies has retreated from the public gaze. The way in which the provision of our energy has become ever less democratically accountable over the past four decades.
It is 10.30 and the doors have opened. Together with colleagues from Greenpeace UK, Tar Sands Network and ShareAction, I drift into the building along with folks from the more activist institutional investors such as Rathbone Greenbank and CBIS. Our share certificates are checked, our bags are opened, we pass through a metal-detector archway and our pockets are frisked – all this is standard these days when attending the annual general meeting of a publically limited company. But for some reason security is extra tight today. Danny Chivers, of BP or Not BP ?, is dragged out even before he passes through the first line of security. Suzanne Dhaliwal of UK Tar Sands Network is surrounded by guards, her name checked against a list on a clipboard, and she is told that she cannot enter. She’d wanted to raise concerns about the impacts of BP’s tar sands projects on the land and communities of Alberta, Canada. Both of them are banned despite being shareholders and therefore a part-owners of the company. Hearing this news, I try to raise objections with the BP staff standing in the crowded foyer. Hannah Powell, BP Head of Group Secretariat, gives me short shrift and hurries on. Jens Bertelsen, BP Deputy Secretary, is at least open for a brief exchange but says ‘they have protested before and will not be allowed to enter’. The judgement is summary and final. In this ‘shareholder democracy’ if the Board, and those who serve it, do not want to hear your views, then your right to speak and to vote is blocked. (Indeed the company places dissenters under surveillance. Last autumn it became public that the Facebook at twitter account of Danny’s colleague, Jess Worth, had been monitored by BP since mid 2012)
We enter the main conference room. There are hundreds of chairs laid out in rows, a sea of grey-headed pensioners all facing towards the podium. Up there, seated at a desk many meters long, are the fourteen Directors and Non-Executive Directors of BP, (12 men, 2 women) each behind a clearly visible sign which gives their name. They gaze down on the assembled shareholders. (You would little guess that we are their owners, their electorate.) Charlie Kronick, my colleague from Greenpeace UK and also a shareholder, has been allowed entry but has been placed on ‘The Red List’. This means that while he is in the building he has to be constantly chaperoned by Elodie Grant Goodey, BP Head of Societal Issues & Relationships. Despite her title, Elodie says she didn’t know why Charlie, with whom she’s often in dialogue, has been designated as a security risk in this way. I chat with Jeremy Leggett of Solar Century, he’s not been to one of these AGMs for a while and is shocked that the wifi in the room has been shutdown. Like a state under threat, the company has cut off our access to parts of social media. A little later, one of the investors stands up and asks the Board why this is the case, when at the same time all of us in the hall are being filmed by the company? She gets no reply.
At just after 11.00, Carl Henric Svanberg, BP Chairman rises to give the opening speech to the AGM. It contains a surprising message from the head of an oil & gas corporation:
“We need to play our role in the action on climate change…We will discuss a resolution, brought by a group of our shareholders, encouraging us to give more disclosure and be more transparent about the steps we are taking. We are pleased to support the resolution (#25)”
He goes on: “Climate change is a clear challenge for the world…Most seem to agree on WHAT the challenge is, but opinions differ in HOW to address it. There is nevertheless a transition to a low carbon future that needs to be managed…Our role as companies is to develop our business within (a) policy framework. That is what we do best and where we can make a difference…To balance the energy demands of the world and the need to address the growth in emissions requires a thoughtful approach. (And)…fossil fuels will be part of a balanced, sustainable energy mix for many decades to come.”
He lays out the three things BP will do: push the political agenda to create a global ‘carbon price’; extract & sell more gas as a way to replace coal in electricity generation; and reduce the CO2 emissions that come from its own operations, from refineries to company cars.
Normally it is only the individual shareholders, such as pensioners and former employees, who come to the AGM. The institutions that hold large blocks of shares rarely attend. But several are here today including the California Public Employees’ Retirement System (CalPERS), one of the largest global pension funds. Bill McGrew, Portfolio Manager, has travelled from the US and speaks from the floor: “CalPERS applauds BP and the Board’s leadership for supporting greater disclosure of how risk factors such as climate change … impact the company’s long-term business strategy. BP’s decision to support and recommend shareholder approval for Resolution #25 is the example for companies to follow.”
CalPERS is one of the group of investors called ‘Aiming for A’ that includes the Church of England, the UK Local Authorities Pension Fund Forum and Rathbone Greenbank. Guided by ShareAction and ClientEarth, and the labour of several key players such as Matt Crossman of Rathbone Greenbank and Louise Rouse, they have pushed hard for a shareholder resolution on BP’s CO2 emissions. This formal request that the Board takes action on climate change is made in the name of 100 institutions and individuals, of which I am one. With the backing of the Board, the resolution is passed with the support 98.28% of the shareholders – just over 11 billion shares. This is the first time an environmental-themed resolution has been passed at the AGM of a European corporation.
I believe it will be a positive thing that the company will now be required by law to provide disclosures on how it will address its CO2 emissions and how it is planning for the imminent low-carbon transition. BP, despite its name, is largely a US company, and in that country where scepticism of the very existence of man-made climate change is so widespread, a corporation taking this action is an important step. However, what the company is actually committing to do appears to be less than it was undertaking back in the early 2000’s. In the space of a decade BP has gone backwards on addressing climate change. Under Tony Hayward the company rapidly shed its image of going ‘beyond petroleum’ and shut down its Alternative Energy division. Why is Dudley supporting this move now?
There is a parallel resolution being made by the same group of shareholders to Shell. It was initially strongly resisted by the company. But when it became clear that the cofiling group included many major investors concerned for the future of the company, the Board did a volte face and recommended that all its shareholders vote for the resolution. BP rapidly followed suit. The switch is instructive. Clearly BP identified that the burden of having to report on its emissions is not too great, especially when weighed against the benefit of getting the support of so many shareholders and the opportunity of appearing an ‘environmental leader’ in the build up to the Climate Conference in Paris this year. Had it blocked the resolution it would have stoked dissent amongst a significant body of investors. So social pressure in this form was tolerated and, in the end, welcomed. The company has a legally binding obligation to report on how it is addressing carbon asset risk going out to 2035, and democracy has been managed.
The Chairman’s presentation is followed by that of the BP CEO Bob Dudley. He dwells upon the disaster in the Gulf of Mexico: ‘In four days’ time we will mark the fifth anniversary of the Deepwater Horizon accident when we lost 11 colleagues. (This) reminds us that we work in a high risk industry in a high risk world – one where we must always be highly vigilant, where we must learn constantly – and where we rigorously apply what we learn with discipline every day. We never forget the colleagues we have lost and their loved ones, and we constantly strive for the highest standards of safety.’
Derrick Evans, a long term community campaigner from Louisiana, comes to the microphone and speaks to the Board and the hall:
“I speak on behalf of the many communities and the clean-up workers who are still impacted by the spill. I came here before in 2012 and invited you the Board to come and see for yourself what we see. To see how things are going on The Gulf. But nobody came. I’m here to ask you again.”
He continues:”I’m also here to remind you of your obligation to the people of the region who are suffering a tremendous public health impact – an impact felt especially by the people who were your cleaners. They are suffering from the effects of the oil dispersant you used – what we call ‘BP’s Secret Sauce’. Secret because no-one knows what is in it that makes it so harmful. And Sir, I’ve travelled a long way at my own expense especially because others like Paul Nelson, who wanted to come, are too ill to make the journey.”
The BP Chairman is polite but condescending in his reply: “We understand your concern. We don’t need to be invited to come, as we are there all the time. Bob Dudley here, and Lamar McKay, BP Chief Executive Upstream, were both raised in the Southern States” Dudley himself follows up more bullishly – speaking down from the podium: “The dispersant used, Corexit, is not BP’s ‘Secret Sauce’. In its use we did not exceed the limits set by the Coast Guard, as you well know.” These two men give Derrick enough space so they do not to appear to silence a ‘community representative’, but then they to rapidly close down the issue and allow the company to glide on. They convey the sense that the disaster in the Gulf is a matter of past regret, despite the fact that it is still the subject of a legal war in the courts of New Orleans and agonising illnesses for so many of the inhabitants that live along the Gulf.
If Bob Dudley’s presentation uses somber tones for the Gulf of Mexico then he speaks excitedly about another of BP’s major provinces: Azerbaijan.
“I was proud to represent BP in September as we marked the anniversary of an agreement we first signed in Azerbaijan 20 years ago. That deal to produce oil became known as the Contract of the Century. It has brought new prosperity to the people of Azerbaijan – and I would suggest to you all, it is a good place to visit – but it also paved the way for new business deals and future partnerships.”
A slide shows the route of the Southern Gas Corridor – the Euro-Caspian Mega Pipeline – a line scything across Azerbaijan, Georgia, Turkey, Greece, Albania and Italy. He explains that in the last year pipes have begun to be laid in the ground. Another image shows him with the Azeri President Ilham Aliyev at a ceremony in Turkey. ‘It shows how quickly things can happen when business and governments work well together. Such projects will generate value for BP for many decades to come and I am very proud to go to work knowing we make big differences to people’s lives in this way. Our aim is always to achieve the best possible value for you, our shareholders. But at the same time we are a business with a wider purpose. The money you invest and the energy we deliver transform economies and transform millions of people’s lives.’
When the moment comes I step to the microphone and pitch at the Board: “My question is why are you not being transparent with your shareholders about their exposure to risks in Azerbaijan? You fail to alert both the shareholders in this hall & the institutional shareholders, as to the real risk in Azerbaijan – both financially, politically & reputationally.
When the Shah Deniz II project was announced the oil price was $105 per barrel. Today it half of that. SOCAR, your key partner, has stated that production is at a loss at below $60 per barrel. Both Total and Statoil have pulled out of the project saying it’s not commercially viable. The Shah Deniz project and the Southern Gas Corridor now pose a significant risk to shareholder value. At a time of capex constraint why are you pursuing this project?
This project is being driven by the political need to keep close the Aliyev family. This also poses huge risks. The human rights record of the Azeri government has plummeted in the last 9 months, there are at least 100 political prisoners and only recently Human Rights Watch was blocked from entering the country. The situation in Azerbaijan is getting rapidly worse and you are tying the company inextricably to it. You will tar BP with the appalling reputation of this government.
The Chairman bats off the suggestion there’s financial risk in the gas project and its pipeline. Then passes the ball to the CEO: “Bob perhaps you’d like to say something – you go there a lot.”
“Yes Carl I do. And urge you all to go to Azerbaijan, its a great place – if you’ve been there you’ll see. Its a very complex political situation – there are other states in the neighbourhood pressurising Azerbaijan and saying the kind of things you are saying.”
At almost exactly the same hour on that April day, outside the Court of Grave Crimes in central Baku, Azerbaijan, a sandy wind is swirling grit into people’s eyes. A young man emerges from a doorway. He is pushed head first into the dusty assault; arms behind his back and eyes watering, he is forced into a waiting car. The man is Rasul Jafarov, he has just been sentenced to six and a half years for a crime he didn’t commit.
We last saw Rasul the previous June. He was in a good mood – showing us the studios he had just set up for dissident musicians. Rasul told us how hard things had become in recent months as the Azeri government made it impossible for independent ngos to register foreign grants. He explained that despite the promise that BP’s investment into the Azeri offshore fields would bring development and with it greater democracy, the opposite had in fact happened:
“Before the oil and gas incomes came to Azerbaijan we had more democracy and freedom. The main income from oil came in 2006 when the Baku-Tibilsi-Ceyhan pipeline started to operate. And from that time the situation started to deteriorate.”
Rasul shot to prominence in Azerbaijan when he spearheaded the Sing for Democracy campaign in 2012. The initiative highlighted the lack of democracy in a country where the ruling family have held onto power for 22 years through fraudulent elections, attacking independent media and arresting opponents. Since then Rasul has focused on supporting political prisoners in Azerbaijan. Last year he announced the launch of a Sport for Rights campaign that would be targeting the European Games in Baku 2015, of which BP is the main corporate sponsor. Shortly after he was arrested for illegal entrepreneurship and tax evasion – a few days later he would have his 30th birthday in jail.
Rasul was held for 8 months in pre-trial detention, until he was sentenced to six and a half years in an Azeri jail on the same day as the BP AGM. Human Rights Watch called the charges ‘bogus’. During the trial, the ‘victims’ called by the prosecution stated that they were fully paid by Rasul and did not regard themselves as victims. When they tried to present documents to prove this the judge refused to look at them. Trials in Azerbaijan are not about truth or justice – their purpose is intimidation, brutalising those who stand up to the Aliyev government and ensuring no one else dares speak out. Rasul is far from alone.
Platform, Index on Censorship, Human Rights Watch, Article 19 and a range of other ngos have requested that BP speak out about the rapidly deteriorating situation in Azerbaijan. But the company has refused to act, or even to meet local Azeri civil society groups. Perhaps Azerbaijan shows, as Dudley says: ‘… how things can happen when business and governments work well together”
Although there are difficulties for English critics of BP to get into this hall, and Derrick had to fly from the US at his own expense and on his own time, for Rasul, who has expressed his doubts about the benefit of the company’s actions in his country, it is imposible to stand before the Board in ExCeL. Dudley is able to blithely repeat the line: “I urge you all to go to Azerbaijan, its a great place”. And yet those who live in Baku and question how ‘great’ a place it is under the current government that is underpinned by BP, are utterly unable to come here and dispute the CEO’s assertion. Rasul’s voice in this AGM would have a powerful force, and yet he is silenced by the Aliyev’s courts. Those who would question the actions of BP are prevented from doing so. Once again, democracy is managed.
After the Meeting closes I spend time chatting with some of the BP Social Responsibility team. One of them expresses exhasperation at the coments from the CEO: “Why did he say THREE times that Azerbaijan’s a great place to visit? Is he working for their tourist board?” There seems to be a concensus that the situation in Baku has got radically worse. But there’s no sense that this is permeating through BP to the higher levels. The Board is deaf to its own staff.
What is this growing tightness and anxiety in the company about?
Is it the fear of unwanted attention to the Fifth Anniversary of the Gulf of Mexico disaster?
Are they worried about bad press around the 25% increase in Bob Dudley’s pay packet? He’ll receive $12.7 million in salary and bonus for 2014.
Or is it the fear that the company is about to be taken over by ExxonMobil? Five days later news leaks out that BP has ‘war-gamed defence strategies’, with the assistance of Morgan Stanley, to resist a hostile takeover bid.
As Bloomberg news writes – the company is in the cross-hairs.
Thanks to Emma Hughes, Sue Dhaliwal, Derrick Evans, Danny Chivers, Louise Rouse.