BP 2011 Annual Report Download - page 13

Business review: Group overview
BP Annual Report and Form 20-F 2011 11
During the year, the remuneration committee has worked with Bob Dudley and
his team to remodel the reward system within the group. The system below
the board is now clearly focused on the long term and is similar to that used for
executive directors. I believe our approach to rewarding directors balances the
company’s priorities of driving financial performance, meeting our responsibilities
as a corporate citizen and providing value for our shareholders.
Against all of this background, I have been keen to see how the board
could work more effectively. During the year, a working group of non-executive
directors reviewed board tasks, roles and processes. This work, coupled with
our board evaluation, has led to a number of changes in the way in which the
board operates. These are set out in the board performance section of this
annual report.
2011 was a testing year for everyone at the company. The board was
impressed by the way in which Bob and his executive team tackled a range of
considerable issues. We were also struck by the tenacity and dedication of BP’s
employees. On behalf of the board, I thank everyone for their efforts.
In 2012 we must execute our 10-point plan and continue to meet our
commitments in the Gulf of Mexico. While many of the investigations into the
causes of the accident have been completed, we still face major litigation in the
US during 2012. This must run its course, although we are pleased with the
continuing progress that we are making with settling some of these claims.
As part of its strategic role, the board must be mindful of the long-term
developments in our industry. BP Energy Outlook 2030 tells us that rising
populations, increasing levels of life expectancy and improving standards of living
will continue to generate growing demand for energy. The challenges in terms of
supply are immense. I expect these dynamics to provide BP with opportunities
for decades to come. The report projects that fossil fuels will be providing around
80% of the world’s energy in 2030. This will require companies such as ours to
overcome substantial technical and physical challenges. Lower carbon resources
and energy efficiency technologies are required to play their part in addressing
both demand and emissions. BP must understand and adapt to these changes
in order to remain sustainable in this changing world.
I believe BP ended the year stronger and safer, with increasing forward
momentum and a clear strategy matched to the world we see ahead. This
is a great company, with a strong board and excellent people. I thank you for
your continued support. I will report back to you on BP’s progress at this point
next year.
Carl-Henric Svanberg
Chairman
6 March 2012