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After garnering an early fame as a profitable if considerably boring Norwegian chief govt, Helge Lund has now discovered himself on the centre of company drama at not one however two of Europe’s largest corporations.
The 62-year-old former McKinsey guide has develop into a lightning rod for shareholder dissatisfaction at oil and gasoline group BP and drugmaker Novo Nordisk as chair of each companies.
At BP, Lund has presided over a board that modified each technique and chief executives, whereas dealing with stress from a big activist shareholder and drawing protests from a number of massive, extra conventional shareholders.
At Novo Nordisk, he initially led the Danish group on its fast accession to become Europe’s most dear firm, using a wave of big demand for its pioneering weight reduction drug Ozempic. However previously yr the share worth of the corporate has halved, culminating within the shock ousting of its fashionable chief govt final week.
Lund is one in all Europe’s main industrialists. However can he regain the belief of shareholders at two such vital corporations? He seems to have his work minimize out in keeping with the shareholders I’ve spoken to. The share worth efficiency of each corporations counsel their views are consultant.
“Over the previous 6-12 months, he has not performed job. He’s likeable and pleasant however he isn’t demanding sufficient. His time is working out,” says one smaller Danish shareholder in Novo. And one BP shareholder, a considerable European institutional investor, provides: “We’re not seeing an inquisitive board that’s receptive to shareholders, or questioning sufficient of administration.”
The one-time prescribed drugs govt got here to fame in his native Norway as a younger chief executive of Statoil, the nationwide oil and gasoline champion, for a decade up till 2015. Below him, Statoil — since renamed Equinor — swallowed the oil operations of native rival Hydro and expanded internationally, though the latter has develop into extra controversial attributable to massive historic losses in its US enterprise. His remaining govt profession was shortlived however extraordinarily profitable after he grew to become head of BG Group in 2015, just for Royal Dutch Shell to announce eight weeks later that it was taking it over.
Lund then moved into the non-executive world, in 2018 changing into chair of Novo, on the time a decent-sized however somewhat boring diabetes drugmaker. Along with chief govt Lars Fruergaard Jørgensen, he oversaw a unprecedented interval that noticed Novo make world headlines attributable to its weight-loss medicine. Its share worth rose greater than six-fold by 2024.
However the previous yr has been a lot harder, as fierce competitors from Eli Lilly led to a stoop in each revenue progress and share worth. On Friday, Lund introduced the departure of Jørgensen however left some shareholders annoyed by what they noticed as an absence of readability on why he had taken such a dramatic step. “We wished to see a stronger chair, who’s pushing administration. We’re anxious that he has been distracted by the mess at BP,” says the Danish investor.
Lund declined to remark, as did BP and Novo. However allies of the Norwegian consider he has been capable of dedicate sufficient time to each corporations, bringing a broader perspective that may profit Novo and BP alike.
His largest problem has arguably come on the UK oil and gasoline firm, which he has chaired since 2019. Lund’s job was to supervise two transitions — to extra renewable energy, and in recruiting a brand new chief govt — however faltered on each. An enormous change in technique in 2020 to embrace renewables was itself reversed this February, whereas BP fired Lund-backed Bernard Looney as chief govt in 2023 for knowingly deceptive the board over previous relationships with colleagues. Over the previous yr, the BP share worth has fallen by 1 / 4.
Allies argue that it has been a tumultuous interval for BP, marked by extraordinary occasions from the Covid pandemic and Russia’s invasion of Ukraine to Looney’s departure and the arrival of hedge fund Elliott Administration agitating for the corporate to slash its spending on renewables.
However 1 / 4 of the votes on Lund’s re-election in April went in opposition to him regardless of his promise to leave his position, mostly likely by next year — it was the largest protest vote in opposition to a FTSE 100 chair in five years. That signifies many shareholders will not be in a forgiving temper at BP. Except the share worth efficiency of Novo Nordisk turns round shortly, shareholders on the Danish firm are more likely to be of an analogous mindset.
BlueSky: @richardmilne.ft.com
