It's official: Hayward is out as head of BP oil with no 'golden parachute'

Yesterday rumors were running high that Tony Hayward, CEO of BP Plc, the oil giant responsible for the massive disaster in the Gulf of Mexico, would be ousted from the top spot at the company. The Board of Directors met in London yesterday and today confirmed the reports that Hayward will step down from the role effective October 1. He will be succeeded by BP Executive Director Robert Dudley, who replaced Hayward as the official company spokesperson after Hayward made a series of gaffes in speaking to the public about the oil spill disaster.

Hayward was largely reviled by the American public after stating that he hoped the oil spill could be contained and cleaned up soon so he could “get my life back.” This, said in the face of thousands of Gulf Coast residents who lost their livelihoods as commercial and charter fishing was shut down, tourism plunged and business across the region plummeted in the face of oil spill realities and fears. Hayward also was criticized for saying the oil spill only affected a relatively tiny bit of the ocean when you look at how big the whole ocean is, and for attending a luxurious yacht race while Gulf Coast residents struggle to survive.

According to an official BP news release, Hayward said: “The Gulf of Mexico explosion was a terrible tragedy for which – as the man in charge of BP when it happened – I will always feel a deep responsibility, regardless of where blame is ultimately found to lie.”

The Wall Street Journal reported this morning that a surprising feature of Hayward’s departure is that he will not receive a so-called “golden parachute,” the term applied to a large payout to executives who leave big companies sometimes under dubious circumstances. The BP news release confirms this, saying Hayward will receive a year’s salary as severance, which amounts to a little over £1 million. This is a drop in the bucket considering some of the huge sums provided to departing company heads in recent years. Speculation says while BP may have been able to afford such a payout financially, it could not afford the additional public relations damage a package of that sort would cost.

Dudley is the first American selected to head the British company. When he assumes the role of CEO, he will move to the company’s London headquarters. Lamar McKay, Chairman and President of BP America will take over Dudley’s duties as the face of the oil spill cleanup. Although BP expects to finish drilling on two relief wells and permanently plug the oil leak by the end of August, no doubt recovery efforts in the Gulf Coast – both environmental and economic – will continue for many months into the future.