Talking Points: How can boards reduce the risk of a messy exit?

When BP sacked its chairman last month, it raised some big questions about how boards are managing senior appointment due diligence. We consider what lessons can be learned from the fallout.

In late May, BP announced the departure of chairman Albert Manifold after whistleblower reports led the board to have “serious concerns” about “governance oversight and conduct issues it deems unacceptable.” Manifold hit back forcibly, saying in a statement: “What I do not accept is that lies can be told about me, nor that anyone should be allowed to hide behind anonymity when commenting on my time at BP.”

The Times described Manifold’s departure from BP as “one of the messiest boardroom bust-ups in British corporate history.” The sudden departure of a chairman who had only been in post since October 2025 caused understandable market consternation; investors have been left with very few details about why Manifold was sacked and there is the potential for legal action to follow.

BP has been here before: The issue of poor management due diligence appears to have arisen again less than 3 years after Bernard Looney was dismissed amid allegations he failed to disclose an relationship with a colleague.

But the real messiness of this story is that allegations and counter-allegations are being thrown about while the company is in crisis mode. No-one seems to have been prepared for this possibility nor was there a plan for how to handle such an eventuality.

The lack of planning suggests that the pre-appointment due diligence conducted by BP didn’t turn up any potential areas of concern, which is surprising given that an FT reporter was able to speak to ten former colleagues of Manifold’s last week and return with a very mixed picture of his leadership style, which the newspaper said “could leave staff feeling humiliated or sidelined.”

Egon Zehnder, which managed the search process leading to Manifold’s appointment, declined an invitation to comment from the FT, but said it applied “well-established assessment and referencing standards to all our mandates, including independent third-party due diligence”

So there’s a gap here: former colleagues are now willing to voice concerns about how Manifold behaved in the past, but the head hunter’s due diligence seemingly didn’t identify anything that would have alerted their client to a potential future risk before appointment.

There’s a lot we can’t know about the specifics of the Manifold case – perhaps some of them will eventually be litigated in court. But as board advisors, we see several glaring issues that really need to be addressed by other corporates seeking to avoid a similar damaging crisis.

1. Conflict of interest: Board members should ask themselves are they’re placing too much reliance on due diligence conducted by head hunters? While search firms play an important role in the diligence process, there is an unavoidable conflict of interest at play here. Where boards are in receipt of due diligence conducted or commissioned by head hunters, they should be able to compare it with independent research they themselves have commissioned. Otherwise, they run the risk of a search firm marking its own homework.

2. Nuance: Too often, independent referencing is seen as a “spoiler” that runs the risk of upsetting a complicated and expensive process by surfacing vague or spurious claims about a candidate’s reputation. But as the FT’s reporting of the Manifold case shows, such referencing is often nuanced, turning up a range of good as well as bad opinion. A genuinely nuanced management due diligence won’t act as a spoiler, but it will arm a business to identify potential future risks so that a balanced judgement can be reached on an appointment.

3. Preparedness: Ultimately, a rigorous due diligence process for senior hires is about sound risk management: Knowing an issue may arise with a particular candidate doesn’t disqualify them from consideration when they have many other positive qualities. But it should allow a business to be alert to risks and plan calmly for how to mitigate them if they arise.