The US Congress spent a full seven-and-a-half hours grilling BP boss Tony Hayward yesterday, and it’s fair to say that he didn’t make any new friends: his inquisitors grew increasingly irate with his failure to answer questions about exactly what went wrong with the Deepwater Horizon rig. Hayward may have been right not to pre-judge the ongoing investigation, and to stress the involvement of other parties. But in truth, this was always going to be an exercise in damage limitation: the question was not whether he would lose, but how badly. And with BP shares up 4% this morning, the market seems to think he at least succeeded in taking his medicine without making the situation any worse…
Things didn’t start well for Hayward: the Congressmen spent the first hour-and-a-half on opening statements, vying to outdo each other in their BP-bashing. And when he was finally subjected to questioning, the tone – as you’d expect – was unremittingly hostile and aggressive. Based on their own investigations, they accused BP of cutting corners on safety to save money, ignoring warning signs and generally taking ‘astonishing’ risks with workers’ lives. When Hayward failed to answer their specific questions – arguing, in many cases, that he didn’t want to pre-judge the results of the ongoing investigation, and pointing out (not unreasonably) that several other companies were also involved – they variously accused him of ‘copping out’, ‘kicking the can down the road’ (whatever that means) and ‘equivocation’.
The Congressmen also slammed Hayward for his admission that he didn’t know anything much about the Deepwater well before April – to which he replied that he couldn’t know everything about all of BP’s hundreds of wells. This is a tricky one: while it’s true that a CEO of such a large company can’t possibly and shouldn’t be expected to know all its operational details, it’s also true that they need to know what they need to know. This well was a hugely complex undertaking, operating on the limits of existing technology; since the consequences of something going wrong were clearly enormous, perhaps he should have had a better grip on the minutiae.
Still, a deeply uncomfortable Hayward did his best to sound penitent (‘deeply sorry’… ‘personally devastated’ and so on) and not upset his questioners any further, speaking in quiet and measured tones throughout. He looked like he’d been media-coached to within an inch of his life not to say anything significant, which was never going to do down well with the Congressman – but was probably about the safest option in the circumstances. And at least he didn’t make any stupid gaffes like his chairmen’s brainless reference to ‘the small people’ in his apology the other day (we can see now why they've kept him in the background).
This morning BP shares are up 4%, helped by news from the US that the drilling of the relief well is progressing ahead of schedule (and yesterday’s announcement of a $20bn compensation pot). There also seems to be a relief that Hayward has survived this session in the public stocks, being pelted by rotten fruit, without inflaming this incredibly difficult situation any further.
In today's bulletin:
Hayward survives seven-and-a-half-hour kicking from Congress
Network Rail boss unexpectedly quits as bonus showdown looms
CGT rise will hurt the recovery, says BCC (and Lord Sugar)
Letters from Malawi: Four hours of stamp duty
My Week: Michelle Dewberry of Chiconomise