Two down: third time lucky for the treasurer as chief executive of BP?

July 27, 2010

As chief executive of the Association of Corporate Treasurers (ACT) I was particularly concerned not to miss opportunities to strengthen the view that treasurers, far from being shrinking violets confined to their black boxes (do violets flourish in black boxes?), were perfectly capable of building careers beyond the role of the treasurer.  We were of course also concerned to ensure that the ACT as a professional body remained relevant and of value to members whose careers took them away from treasury.

I was always keen to draw attention to role models, treasurers who had indeed moved their careers onwards; in this respect BP was always the prime example of a company where individuals had done just that.  In BP there has been a tradition of bringing high-flying staff into the senior treasury role without regard to any previous experience that might more conventionally have qualified the person for the job.  The scope and the sophistication of the BP treasury team would have provided an excellent foundation for this; having known some of the BP people I would not doubt that an incoming group treasurer will be well supported by the key staff.  At that level – and given the maturity of the treasury management processes in place within BP – I see the career development policy of BP as eminently sensible.

What BP of course recognised is that the strategic and risk decisions embedded in the work of a ‘best in class’ treasury team are precisely those that a future chief executive should be exposed to and comfortable in carrying the responsibility for them.  In this respect BP must be similar to the traditional career development approach of the British civil service, most frequently typified in its apparent bravado in promoting its staff without regard to the immediate relevance of their past experience.

It is therefore sad to note that the two examples of BP treasurers reaching the chief executive’s position have now both ended in tears.  John Browne (Lord Browne) and Tony Hayward were both seen as high-flyers who moved through the role of group treasurer and on to become chief executive.  Both have had their careers undone by some significant business challenges and how they chose to handle them.  I stress the latter because this note is in no way intended to excuse their failures; so far as I can tell, from way outside, both Browne and Hayward made some fundamental mistakes.

Interestingly in both cases the core of their mistakes seems to revolve around communications.  Maybe this reminds us how all-rounded chief executives, of whatever size organisation, must be.  Treasury skills are indeed strategic and risk-focused; but success requires the application of judgment across such a wide range of business processes and not the least of those is communications.

I hope there will be a third opportunity for a BP treasurer to succeed as chief executive, reversing what for the moment looks suspiciously like more than just bad luck.  In the meantime perhaps treasury associations should focus harder on the all-round skills required for personal success and embed their awareness.  Role models are still needed.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: