Environmental, social & governance - Sustainability at the heart of our strategy to deliver value to our stakeholders
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Environmental, social
& governance
Sustainability at the heart of our strategy
to deliver value to our stakeholders
Investor Pack
Rev: May 2022
1
Cautionary statement
In order to utilize the ‘safe harbor’ provisions of the United States Private Securities Litigation Reform Act of 1995 (the ‘PSLRA’), bp is providing the
following cautionary statement. This presentation contains certain forward-looking statements – that is, statements related to future, not past
events and circumstances – which may relate to one or more of the financial condition, results of operations and businesses of bp and certain of the
plans and objectives of bp with respect to these items. These statements are generally, but not always, identified by the use of words such as ‘will’,
‘expects’, ‘is expected to’, ‘aims’, ‘should’, ‘may’, ‘objective’, ‘is likely to’, ‘intends’, ‘believes’, ‘anticipates’, ‘plans’, ‘we see’ or similar expressions.
In particular, the following, among other statements, are all forward looking in nature: plans and expectations relating to bp’s new strategy including
statements regarding the delivery of that strategy, plans for bp to be a very different kind of energy company by 2030, and expectations to grow
long-term sustainable shareholder value; plans and expectations relating to bp’s sustainability frame; plans and expectations relating to bp’s financial
frame and investor proposition; statements regarding bp’s ambition to be a net zero company by 2050 or sooner and help the world get to net zero;
statements regarding the five aims to help bp get to net zero including 2025 targets and 2030 aims in respect of emissions reductions, carbon and
methane intensity and the proportion of investment in non-oil and gas businesses; statements regarding the five aims to help get the world to net
zero including expectations and plans for the partnerships and joint ventures referred to in the clean cities and corporates section of the
presentation; statements regarding the five aims to help improve people’s lives including just transition and greater equity and five aims to care for
our planet including aims for a net positive impact on biodiversity from new projects and to be water positive by 2035 and championing nature
based solutions. By their nature forward-looking statements involve risk and uncertainty because they relate to events and depend on
circumstances that will or may occur in the future and are outside the control of bp. Actual results may differ from those expressed in such
statements, depending on a variety of factors including the risk factors set forth in our most recent Annual Report and Form 20-F under “Risk
factors” and in any of our more recent public reports.
Our most recent Annual Report and Form 20-F and other period filings are available on our website at www.bp.com, or can be obtained from the
SEC by calling 1-800-SEC-0330 or on its website at www.sec.gov.
2
Introduction
In 2020, we reinvented bp, introducing a new As part of our ambition to be a net zero company
purpose, ambition, strategy and sustainability by 2050 or sooner, we laid out 10 net zero aims,
frame, as well as a new financial framework with interim targets for 2025 and aims for 2030.
and investor proposition. Through our sustainability frame we set out 10
It was clear that we needed to change, for three further aims – five to improve people’s lives and
key reasons: we recognize that the world’s five to care for our planet – in doing so
carbon budget is finite and running out fast; connecting the business opportunities of the
society is calling for different, more sustainable energy transition with environmental and societal
forms of energy; and this change represents an needs.
enormous business opportunity for bp. We believe strong environmental, social and
We are now focused on executing the strategy governance performance benefits society, our
and growing long-term sustainable shareholder employees and our shareholders.
value. It creates resilience and enduring value across
By 2030 we plan to be a very different kind of our activities – from more efficient operations
energy company; an integrated energy through to unlocking growth opportunities in the
company, delivering integrated solutions for energy transition.
our customers. And just as we have clear metrics for our
This presentation describes our approach and financial performance, our net zero, people and
progress on ESG and the value it brings to our planet aims can be used to track our
stakeholders. It supports our investor sustainability performance and inform
proposition and underpins the transition story engagement. They help show how purpose and
we have laid out so far. We look forward to profit work together, delivering long-term value
continuing the dialogue with you, our owners. for our stakeholders.
Bernard Looney Giulia Chierchia
Chief executive officer EVP, Strategy, sustainability & ventures
3
Contents
Context Getting to net zero Improving people’s lives Embedding sustainability
Key references Our net zero aims Our people aims Culture
Highlights Paris consistency Just transition: Human rights Capability
Reimagining energy and reinventing bp Scope 1, 2 and 3 emissions Diversity, equity and inclusion Remuneration
Our strategy Methane Board & bpLT governance
Caring for our planet
Our sustainability frame Investment allocation
Our planet aims
20 aims to deliver our sustainability frame Helping the world get to net zero
Biodiversity
Disclosures
Water
Foundations
Partnerships Appendix
Nature-based and natural climate
Safety: Our core value
solutions Summary of our aims
Value creation for our shareholders
and other stakeholders
Environmental Social
Governance 4
Key references
Annual Sustainability ESG Net zero ambition
report report datasheet report
• Strategic report • Sustainability at bp • Net zero • Our net zero ambition
• Corporate governance report • Foundations • Greenhouse gas emissions • Getting bp to net zero
• Financial statements • Performance and progress • Safety • The actions we are taking
• TCFD • Embedding sustainability • Environment • Progress to date
• Responses to the requirements of • Engaging stakeholders • Social • Helping the world get to net zero
the 2019 CA100+ resolution • Our reporting • Governance • Governance and capital allocation
What is included in this presentation
Reporting centre This pack consolidates a number of aspects covered across our reports including those highlighted
All reports, policies and positions, above. In some cases this includes simplification of more complex topics. Where a topic is covered in
data and assurance, standards and bp’s corporate reporting or other disclosures, its coverage there takes precedence over this pack. For
frameworks, and archives convenience this pack provides “Go Deeper” references to such disclosures where this may be
particularly helpful, but these are not comprehensive. 5
Context
6
| Environmental
Environmental | Social
Social | Governance
Governance
Highlights
Get to net zero
Aim for net zero by 2050 Aim for net zero Industry leading focus
or sooner across Scope emissions through on methane reduction
1, 2 and 3 with 2025 absolute reductions for with a measurement
targets and 2030 aims carbon in our production approach
Net zero aims cover Five aims focused
multiple points in the on helping the world
value chain: operations, get to net zero
production and sales
A clear strategy from No exploration Material progress since
IOC to IEC to deliver on in new countries 2019 on Scope 1, 2
the aims and create long and 3 emissions
term value in the energy reductions
transition
Expected 40% reduction Capex invested into
in oil and gas production transition expected to be
by 2030 >40% of spend by 2025,
rising to ~50% by 2030
7
| Environmental
Environmental | Social
Social | Governance
Governance
Highlights
People and planet
Fewer tier 1 and tier 2 Aiming for net positive Annual bonuses linked
process safety events impact on biodiversity to safety (15%) and
in 2021 vs. 2020 in our new projects emissions reductions
(15%) metrics in 2021
Five aims Water positive by 2035
to improve people’s – replenishing more
lives and five to care freshwater than we
for our planet consume in our
operations
Defined our aim to Mental health and New or enhanced
support a just transition, wellbeing placed at the disclosures in 2021,
including developing heart of our workforce including TCFD, SASB,
skills for the future agenda tax transparency and
energy system trade association update
Six women on 11
Driving actions to person leadership team;
support and shape the increase in women in
scale up of natural extended leadership
climate solutions team (41%)
Go deeper bp.com/sustainability 8
| Environmental
Environmental | Social
Social | Governance
Governance
Reimagining energy and reinventing bp
Long term value creation for all stakeholders
Purpose Ambition Sustainability frame Financial frame
Our ambition is to be a net
zero company by 2050 or
sooner and to help the
world get to net zero.
We’ve set out 10 net zero
aims, five to help bp get to
net zero and five to help
the world get there too.
Strategy Investor proposition
Profitable
growth
From an international oil company Sustainable
to an integrated energy company value
Committed
distributions
9
| Environmental
Environmental | Social
Social | Governance
Governance
Our strategy
#1 #2 #3
Resilient Convenience Low carbon
hydrocarbons and mobility energy
Sustainability
Integration 10| Environmental
Environmental | Social
Social | Governance
Governance
Our strategy
Resilient hydrocarbons
900mboed
new major project*
~15%
Under budget on average
20%
reduction in drilling &
production since 2016 for the 35 major projects* completions non-productive
delivered since 2016 time vs 2020
Driving portfolio
94% 95%
, competitiveness
▪ Angola and Iraq JVs
▪ Aker bp and Lundin 2021 plant 2021 refining
Energy oil and gas reliability* availability*
business transaction| Environmental
Environmental | Social
Social | Governance
Governance
Our strategy
Convenience & mobility
>$1.5 bn
record convenience
convenience partnership
~55%
Castrol earnings from
extended to at least 2030 growth markets
gross margin
vs $1.2bn in 2019
3 X increase
in bpme customers –
~50%
EV charge points
supported by leading rapid or ultra-fast
digital offers
+2
percentage points
Growing biofuels
including SAF
Strategic investments
and partnerships with
leading fleet and OEM
providers
growth in mix of
premium fuels
12
All comparisons referenced are versus 2019; absolute figures are 2021| Environmental
Environmental | Social
Social | Governance
Governance
Our strategy
Low carbon electricity & energy
23 GW
Creating integrated UK offshore wind
hydrogen and
renewables hubs ▪ 1.45GW bp net
▪ Oman, Abu Dhabi, ScotWind lease option
renewables pipeline1 awarded in 2022
UK and Europe
increased 4x since 2019
US offshore
0.7-1.3mtpa
wind JVs progress
▪ 3.3GW (gross) 25-year
NYSERDA offtake
building hydrogen hopper contracts
in UK, Australia, Europe, ▪ 2GW (gross) turbine
Middle East contract awarded
5.2 GW 53
UK hydrogen and CCS
▪ East Coast Cluster selected
for government support
bp net offshore wind Lightsource bp projects1 ▪ NZT and NEP FEED contracts
pipeline to date achieved FID since 2019 awarded
▪ HyGreen project announced
13
(1) Year-end 2021| Environmental
Environmental | Social
Social | Governance
Governance
Our sustainability frame
Our sustainability frame, which underpins
our strategy, puts our purpose into action.
It takes an integrated approach
while focusing on the areas where we
believe we can make the most difference.
Our focus areas, aims Building on our values
and objectives and foundations
Go deeper bp.com/sustainability 14| Environmental
Environmental | Social
Social | Governance
Governance
20 aims to deliver our sustainability frame
Aim SDGs Aim SDGs
Get to net zero Improve people’s lives
Aim 1: Net zero operations Aim 11: More clean energy
Aim 2: Net zero production Aim 12: Just transition
Aim 3: Net zero sales Aim 13: Sustainable livelihoods
Aim 4: Reducing methane Aim 14: Greater equity
Aim 5: More $ for new energies Aim 15: Enhance wellbeing
Help the world get to net zero Care for our planet
Aim 6: Advocating Aim 16: Enhancing biodiversity
Aim 7: Incentivizing employees Aim 17: Water positive
Aim 8: Aligning associations Aim 18: Championing nature-based solutions
Aim 9: Transparency leader Aim 19: Unlock circularity
Aim 10: Clean cities Aim 20: Sustainable purchasing
15Foundations
16| Environmental
Environmental | Social
Social | Governance
Governance
Foundations of our sustainability frame
Safety: Our core value at the heart of performance across bp
In 2021, compared to 2020 Reported recordable injury frequency Tier 1 and 2 process safety events
(workforce per 200,000 ours worked) (number of incidents)
• Downward trend in tier 1 and tier
2 process safety events
continued in 2021
• An increase in our recordable
injury frequency (RIF) and an
days away from work case
frequency (DAFWCF) vs. historic Tier 1
lows due to the pandemic in Tier 2
2020.
Enhancing safety with automated Safety during the COVID-19 pandemic
technology in the North Sea We continue to assess and respond to
• First onshore remote piloting of a remotely changing circumstances to support our
operated vehicle (ROV) in the UK workforce and customers, including:
successfully conducted at the bp-operated • Caring for our people
Clair Ridge platform.
• Quarantining and testing procedures
• Improves the efficiency and safety of
operations by removing people from site. • Additional protective measures
Go deeper Sustainability Report page 12 17| Environmental
Environmental | Social
Social | Governance
Governance
Foundations of our sustainability frame
Value creation for our shareholders and other stakeholders
value for society value for bp
• Through our products and services • As a supply chain participant • Creates enduring value, for example:
• As an employer • As an investor in local
• As a tax payer communities – More efficient operations resulting in cost savings from energy
efficiency and reducing water usage and treatment costs
Total economic value generated by bp in 2021 – Unlocking growth opportunities in the energy transition
$167.1bn through increasing customer demand for sustainable solutions
Suppliers
$122.2bn Sourcing goods and services from around 40,000 suppliers
• Trillions of dollars of investment opportunities required to rewire and
decarbonize the energy system and global economy
Employees
$8.9bn Providing jobs for 65,900 people worldwide
• Mitigates and reduces risk
Governments
$5.4bn Contributing to economies through the taxes we pay • Helps in attracting and retaining the best talent
Communities
•
$51mn Supporting additional initiatives to benefit the communities
where we operate
Sustainability frame targets and aims enable performance to
be tracked
18Getting to net zero
19| Environmental
Environmental | Social | Governance
Our net zero ambitions and aims
Our ambition is to be a net zero Aim
33 4 Aim 4
company by 2050 or sooner and 22
Aim Net zero Reducing methane
to help the world get to net zero. sales
Net zero Measurement at all our
Net zero across the major oil and gas processing
production energy products we sites by 2023, transparent Aim
reporting and 50% reduction 55
11
Aim Net zero across the carbon in sell by 2050 or
our upstream oil and gas sooner in our operated methane More $ for
Net zero intensity
production by 2050 new energies
or sooner
operations Increase the proportion
Net zero across our of investment
entire operations into our non-oil
Five aims to by 2050 or sooner and gas businesses
get bp to
net zero
Aim 10
10
Aim 6
6 Clean
Advocating cities
More actively Aim 7
7 Launch a new team
advocate for
88
Aim 99
Aim
to create integrated
policies that support Incentivizing clean energy and
net zero, including Aligning Transparency
employees mobility solutions
carbon pricing
associations leader
Incentivize our global workforce
to deliver on our aims and Set new expectations Be recognised as an
mobilize them to become for our relationships industry leader for
advocates for net zero with trade associations the transparency
Five aims to help around the globe of our reporting
the world get to
20
net zero| Environmental
Environmental | Social | Governance
We aim to be a
Key principles to Paris consistency
Net zero
1. Informed by Paris-consistent 2. Positioned for strategic 3. Contributing to net zero
energy transition scenarios resilience
company
• The IPCC1 is the authoritative source • Our Paris consistent strategy is • Our net zero ambition is to become a
on the evolving science of climate designed to position bp for success net zero company by 2050 or sooner
change and we use it and other and resilience in a Paris consistent and to help the world get to net zero.
sources to inform our strategy. world – a world which is progressing • Our strategy is designed to deliver
• They highlight a range of pathways by on one of the many global trajectories long-term value while driving delivery
that meets the Paris goals. of both parts of our ambition – for bp
by 2050 or sooner and to help which the world can meet Paris, with
and the world.
differing implications for regions, • It is also designed to be resilient and
the world reach that goal industries and sectors. flexible to manage uncertainty across • It enables us to contribute to global
• bp’s strategy is informed by these scenarios, but is weighted towards a net zero and meeting the Paris goals
considerations and our Energy rapid transition enabling bp to capture in several ways - including action on
Outlook Accelerated and Net Zero the huge opportunities we see in the GHG2 emissions, technology
scenarios which fall within the range energy transition – and this is what development, policy advocacy, low
of IPCC scenarios consistent with we are advocating for. carbon collaboration, and investments
We believe bp’s strategy is meeting the Paris goals. in low carbon.
consistent with Paris • It is designed to drive decarbonisation • Some ways to contribute are more
readily measured quantitatively than
while remaining adaptable to the
many potential Paris-consistent others – but all are
pathways the energy transition may important, whether or not they
take. translate into GHG reductions for bp.
Net zero Emissions Targets & aims We are confident that our approach is science-based. We are working
✓ Operations ✓ Scope 1+2 ✓ Short-term (2025)
with a number of parties, to help build external understanding and
✓ Production ✓ Scope 34 ✓ Medium-term (2030) (1) Intergovernmental Panel on Climate Change
recognition of our accelerated ambition and its Paris consistency, and (2) Greenhouse gases such as carbon dioxide (CO2) and
✓ Sales ✓ Full value ✓ Long-term (20503) to exchange views on methodologies for evaluating ambitions, aims methane (CH4)
chain and targets. We support the development of methodologies to (3) 2050 or sooner
(4) Relates to Scope 3, category 11 (use of sold products)
evaluate – and potentially further validate – our net zero targets and
aims and the consistency of our strategy with the Paris goals. 21
Go deeper Annual Report pages 30-31Go deeper Net zero ambition report | Environmental
Environmental | Social | Governance
Scope 1, 2 and 3 emissions
Emissions reductions1
Scope Emissions Point in value chain 2021 Progress 2025 Targets 2030 Aims 2050 Aims or sooner
Aim 1
Net zero Scope
35% 20% 50% Net zero
operations
Absolute
1+2 reductions
Operations
Net zero across our entire operations2
Aim 2
Net zero Scope Upstream
production 3 5 Absolute
reductions
oil and gas
production
16% 20% 35-40% Net zero
Net zero across the carbon in our
upstream oil and gas production 3
Aim 3
Full value
Net zero chain Carbon Marketed
Flat 5% 15-20% Net zero
sales (including intensity and physically
end-use reduction traded sales
emissions)
Net zero across the energy products
we sell4
(1) Emissions reductions versus 2019 baseline
(2) Net zero, gross operated
(3) Net zero, bp net equity Aim 1 Aim 2 Aim 3
(4) Net zero, average emissions intensity of our marketed
and physically traded energy products 22
(5) Relates to Scope 3, category 11 (use of sold products)| Environmental
Environmental | Social | Governance
Methane
Current industry Aim 4 shifts towards We have set a
protocols mostly Using continuous
measurement target of 0.20%
use estimation/ detection and
approach – in place at using our
calculation to measurement
quantification to
relevant
Our aim 4 is to install methane report methane sites by end 2023 approach by 2025 drive action
measurement at all our existing
major oil and gas processing
sites by 2023, publish the data, Improvements in methane intensity1 is good business translating to more gas being monetized
and then drive a 50% reduction
How we will meet our aim Progress to date
in methane intensity of our • Focus on achieving reductions • Improved methane intensity in 2021 vs. 2019 (0.14%)
operations. across our key methane sources • Continued progress on upgrading mature fields with new technology
• Investment in technology to both • Working to influence JVs to set their own 0.2% methane intensity targets
0.07%2 reduce methane and improve our
2021
• Collaboration with peers, NGOs, third-party experts and academic
ability to measure it institutions
0.20%
2025 Targets • Continue to support Zero Routine • Working with stakeholders such as EDF and OGCI and to work under the
Flaring by 2030 initiative Methane Guiding Principles
(measurement approach)
• Advocating for robust methane • Awarded gold status by the Oil and Gas Methane Partnership (OGMP),
policies version 2
bp just set a new bar for reducing methane emissions by making measured data the backstop for
reporting against its 0.20% goal by 2025. Mark Brownstein
SVP, Environmental Defense Fund
Sep 2020
(1) Methane emissions from bp operated upstream oil and gas assets as a percentage of total gas to market from those operations Go deeper Methane 23
(2) Methane intensity calculated using existing methodology and, whilst it reflects progress in reducing methane emissions,
will not directly correlate with progress towards delivering the 2025 target under Aim 4Go deeper Annual Report page 32 | Environmental
Environmental | Social | Governance
Governance
Investment allocation
Key investment appraisal assumptions (2020 real) [as of Dec 2020] Board reviews investment cases >$3bn for resilient
2021 2025 2030 2040 2050 hydrocarbons, >$1bn for all transition or low carbon
Brent ($/bbl) 50 50 60 60 50
investments and any significant inorganic acquisition
Henry Hub gas ($/mmBtu) 3.00 3.00 3.00 3.00 2.75
that is exceptional or unique in nature2
RMM 10 12 12 10 10
Upstream oil, refining, fuels (mature markets) 8-10% levered
the proportion of with the Paris goals.
investment we make into Capital expenditure We remain committed to delivering our long term GHG reduction aims – including to
our non-oil and gas Our planned capital achieve net zero across our operations, production and sales by 2050 or sooner –
businesses. expenditure progression out to which means we’re committed to phasing out expenditure in unabated carbon
Low carbon investment 2030 confirms our commitment intensive assets3 and products.
to our net zero targets and We are confident that bp’s future capital expenditures in carbon intensive assets or
$750m aims, including Aims 1, 2 and 3.
2020
products will not exceed the peak in 20134. Our 2022-2025 capital expenditure
Organic and inorganic1 frame is $14-16bn. Under Aim 5, we target $3-4bn in non-oil and gas capex in 2025,
leaving at most ~70-80% of the $14-16bn for carbon intensive assets or products.
$3-4bn
2025 Targets • ~$9bn, oil, gas and refining
• ~$2bn, convenience and Balanced investment criteria
mobility …breaks new ground by
Each of the new material
~$5bn
2030 Aims
• ~$2bn, low carbon capex investments developing a profitability and
carbon intensity test for
Exploration approved since 2020
projects under conditions which
• No new country entries was evaluated to be bp believes are consistent with
consistent with the the Paris Goals
Paris goals [about 2019 report]
(1) 2021
(2) All low carbon or transition and significant inorganic acquisitions that are exceptional or unique in nature CA100+ May 2020 press release 24
(3) We see abatement as including netting by means of offsets as necessary, in order to achieve net zero for the value chains in which we participate, in line with our ambition and aims
(4) 2013 capex on our upstream and downstream segments and inorganic acquisitions was ~$29bn, of which the vast majority related to carbon intensive assets or products (essentially oil, gas, refining and fuels)| Environmental
Environmental | Social
Social | Governance
Governance
Helping the world get to net zero
Aim 6 Aim 7 Aim 8 Aim 9 Aim 10
Advocacy Incentivizing Aligning Transparency Clean cities
employees associations leader and corporates
What we’ve done
• Supported green • Linked cash bonuses to • Published report on • Announced strategy with • Working in partnership
recovery packages balance of safety, trade associations 2025 targets and aims with regions and
• Advocating for carbon environment, reliability and • Exited three for 2030 and 2050, corporates including
pricing in the US performance associations following covering GHGs and Houston, Aberdeen,
• Publishing examples on • Reinvent bp share scheme early review energy transition Valencia, Microsoft &
our advocacy hub further aligns employees to • Progress update where • Enhanced reporting to Qantas
strategic delivery partially aligned include TCFD1
What we intend to do
• Continue advocating for • Increase emphasis on • Continue to promote our • Ongoing reporting to • Focus on partnering with
policies that support net emissions reduction and views on climate change include TCFD1, SASB2 10-15 cities and
zero, including carbon strategy delivery for bp and be transparent where and other initiatives 3 industrial sectors
pricing leadership team we differ
Go deeper Sustainability Report pages 28-32 25
(1) Task Force on Climate-related Financial Disclosures
(2) Sustainability Accounting Standards Board| Environmental
Environmental | Social | Governance
Governance
Disclosures
Our progress and enhanced disclosures are being reflected across the ESG ecosystem Improvement
Assessments do not reflect 2022 updated net zero ambition No change
Ratings agencies & data providers 2020 2021
Our aim 9 is to be recognised BBB A
as an industry leader for the
transparency of our SUSTAINALYTICS 37.4 35.3
reporting.
F A-
(Not reporting)
Reporting & transparency
We aim to work constructively with the Climate initiatives
TCFD and others – such as SASB – to
March 2021 assessment based on 2020 data. March 2022 assessment based on 2021 data,
develop good practices and standards Scored at least ‘Partial’ on all indicators. does not reflect bp’s February 2022 update.
Annual tax transparency report and
Management Quality Carbon Performance Management Quality Carbon Performance
endorse the B Team Responsible Tax Transition Pathway Initiative
Principles 4* (Max score) Not aligned 4* (Max score) Not aligned
Latest assessment does not reflect bp’s February 2022 update
Payments to governments report for
upstream projects and operations Frameworks
Founding member of the Extractive Announced aim for
Expanded disclosures
Industries Transparency Initiative (EITI) expanded disclosures
TCFD In progress Index published
Go deeper Tax transparency
26
Payments to governments report| Environmental
Environmental | Social
Social | Governance
Governance
Partnerships
Cities and mobility Partnering with technology leaders
• Strategic and technical planning advisor to • Working with Microsoft to drive digital
City of Houston on Climate Action Plan and energy innovation and advance net zero
Aberdeen on Net Zero Vision goals through renewable energy supply
• Partnering with Uber to develop EV charging • Expansion of renewable energy supply
infrastructure in Houston to Amazon in Europe, while accelerating
Our aim 10 is to launch a • We have joined forces with leading OEMs migration of key bp data and applications
new team to create such as BMW and Mercedes-Benz to further to Amazon Web Services (AWS) to
digitize bp infrastructure and operations
integrated clean energy accelerate the growth of electrification
and mobility systems.
Why cities and corporates?
• Cities are home to half the
world’s population but aim 10
generate 70% of emissions
• In 2020 alone, >1,000 • Offshore wind • Rapid growth in Lightsource bp
companies set net zero partnerships in the US – our solar development JV
targets Heavy transport and industry with Equinor and UK with • Plan to work with Ørsted to
• Our products, services and • bp’s first decarbonisation partnership in EnBW – two of the best develop green hydrogen for
capabilities can support these heavy transport with Qantas regions for the world’s our Lingen refinery
energy transition journeys fastest-growing energy
• Working to decarbonise cement production source • Partnered with DiDi to build an
and transportation with CEMEX EV charging network in China
• Collaborate on sustainable fuels, advocacy,
renewable power, carbon management and
Go deeper Sustainability Report page 32 27
emerging technologyImproving people’s lives
28| Environmental | Social
Social | Governance
Our people aims
Aim 11
Aim 12
More clean
energy Just
Develop enough clean transition
energy to benefit more than
Five aims 36 million people Support a just energy
transition which advances
to improve Aim 15
human rights and education
people’s lives
Enhance
wellbeing
Enhance the health
and wellbeing of our
employees, contractors
and local communities
Aim 13
Aim 14 Sustainable
livelihoods
Greater Helping more than 1 million
equity people build sustainable
livelihoods and resilience
Greater diversity, equity &
inclusion for our workforce
and customers, and to
increase supplier diversity
spend to $1 billion
29| Environmental | Social
Social | Governance
Governance
Just transition: Human rights
Our 2020 human rights policy clarifies our commitments and strengthens our approach
Clear commitments and Global scope and reach Systematic application
approach
• Worker rights • All employees • Labour Rights and Modern
Our aim 12 is to support a just • Vulnerable groups and individuals • Communities where we operate Slavery Principles
energy transition which • Freedom of expression • Clear expectations for engaging • Working with industry
advances human rights and • Water & sanitation suppliers and business partners • Targeted due diligence
assessments
education. • Land rights
• Independent assessments of
Objectives • Grievance mechanisms Policy conformance for selected
1. Enable just transition for the sites / businesses
workforce
A clear plan to enable a just transition for the And we’re in action
2. Supporting civic dialogue,
workforce
transparency and building local • Driving labour rights and modern slavery principles into
capacity
• By 2023, we will develop and publish 2025 and action across bp and with higher risk contractors and
3. Decent work 2030 metrics and targets for education & suppliers.
employment initiatives and programmes with
• Working with contractors and suppliers in response to
4. Respect and remedy industry partners
labour rights issues and modern slavery indicators
5. Responsible security Ranked 7th of 199 major global companies by the • Rolling out human rights assessment platform
Corporate Human Rights Benchmark (CHRB)
2020 (and 2nd in our sector)
Go deeper Human rights
Human rights policy 30| Environmental | Social
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Governance
Diversity, equity and inclusion
bp’s success depends on having a talented and diverse
workforce that represents the communities we serve
Our aim includes all aspects of diversity – including gender,
race, ethnic minority, LGBTI+ and persons with disabilities.
Value from diverse set of expertise, views and perspectives.
Published our first annual DE&I report in June 2021.
Our aim 14 is greater diversity,
equity & inclusion for our Workforce by gender
workforce and customers, and As at 31 March 2022 Female %
to increase supplier diversity Board directors 40 Women in group leadership
Leadership team 55
spend to $1 billion. People from beyond the UK and US in group leadership
Group leaders (as at 31 December 2021) 32
Objectives All employees (as at 31 December 2021) 39
1. Diverse workforce, inclusive
workplace culture and employee Progress to date Next steps
experience
(includes all aspects of diversity – gender, • Percentage of women and individuals from countries • We are working to reduce gender pay gap
race, ethnic minority, LGBTI+, persons with other than the UK and the US among bp’s group leaders differences and recognize the long-term
disabilities, etc.)
increased in 2021 representation challenge we need to address.
2. Inclusive customer experience
(includes all aspects of diversity – gender, • Gender, ethnicity-and age diversity key metrics throughout • Develop 2025 and 2030 DE&I ambition and
race, ethnic minority, LGBTI+, persons with
disabilities, etc.) the Reinvent selection process targets on gender and racial diversity.
3. Multiply DE&I impact through • Published our UK and US frameworks for action to help
ecosystem partners** and suppliers combat racial injustice
• Listed in the Top Global Employers list by Stonewall – the
largest LGBT+ rights organization in the UK and Europe Go deeper Greater equity 31Caring for our planet
32| Environmental
Environmental | Social | Governance
Our planet aims Aim 16
Enhancing Aim 17
Biodiversity
Making a positive impact Water
through our actions to restore,
maintain and enhance
positive
Five aims to biodiversity where we work Becoming water
positive by 2035
care for our
planet Aim 20
Sustainable
purchasing
Developing a more
sustainable supply chain
Aim 18
Championing
nature-based
Aim 19 solutions
Unlocking Championing nature-based
solutions and enabling certified
circularity natural climate solutions
Unlock new sources of
value through circularity
33| Environmental
Environmental | Social | Governance
Biodiversity
Enhancing We recognize the urgent need to conserve our
planet’s natural and cultural diversity
biodiversity • Biodiversity position launched in 2020, builds upon
our already robust practices across bp projects.
• ‘No go’ commitment for oil and gas exploration in
the most sensitive protected areas1
Our aim 16 is making a
• Three new objectives;
positive impact through our
actions to restore, maintain – Net positive impact (NPI) from new projects
and enhance biodiversity – Enhance biodiversity around existing major operating Partnering with Fauna & Flora International (FFI) to
sites help support the delivery of our new position
where we work. – Support biodiversity restoration and the sustainable
use of natural resources projects in countries where • Focused on developing NPI methodology
Objectives
we operate • Working with FFI on nature-based solutions to help
1. bp projects: restore and protect existing forests
Aim to achieve net positive impact A clear plan to deliver with interim targets
(NPI)
• Expect all new bp projects in scope will have plans Actively involved in industry and cross-industry
2. bp operations:
in place aiming to achieve net positive impact initiatives to support biodiversity, including;
Aim to enhance biodiversity
3. bp countries: • All major operating sites (MOS) in sensitive areas • Business for Nature call to action
Support biodiversity restoration and implementing enhancement plans by 2025; all MOS • UK Business & Biodiversity Forum
the sustainable use of natural by 2030
resources • Nature Action Project at World Business Council for
• 5 projects involving local communities in progress Sustainable Development (WBCSD)
or established by 2025; 10 projects by 2030
(1) Inside the boundary of officially inscribed UNESCO World Heritage sites or Strict Nature Reserves (International Union for Conservation of Go deeper Biodiversity 34
Nature (IUCN) category Ia) or Wilderness Areas (IUCN category Ib) as listed on 1 January 2020| Environmental | Social | Governance
Water
We aim to replenish more freshwater than we Progress to date
Water
consume in our operations
• 2.2% fall in freshwater withdrawals and a 4.1% fall in
We will do this by: freshwater consumption in 2021 vs. 2020
positive • improving the efficiency of operational freshwater1
use and effluent management
• collaborating on projects, targeting opportunities to
• 0.1% of total freshwater withdrawals from regions of
high or extremely high water stress (vs. 4% in 2020)
• We review our water impacts, risks and opportunities
replenish freshwater in stressed and scarce taking into account the availability, quantity and quality
Our aim 17 is becoming catchments where we operate of water and any regulatory requirements
water positive by 2035. • This is conducted every year at major operating sites
A clear plan to deliver with interim targets and periodically at other sites
Objectives
• 20% progress towards water positive by 2025;
100% water positive by 2035
1. Improved efficiency of
operational freshwater use and – Vs. 2020 baseline, adjusting for portfolio change
effluent management between 2020 and 2025
• Plan and set targets by 2025 for improved
2. Collaborate on the most operational efficiencies and collaboration
impactful opportunities to replenish
opportunities out to 2030
freshwater in stressed and scarce
catchments where we operate
Delivering value to bp
Next steps
• Through reduced operational costs and mitigation
Develop our approach for both these objectives and
of operational risks
identify opportunities during 2022.
Go deeper Water positive 35
(1) Consistent of IPIECA definition of freshwater| Environmental
Environmental | Social | Governance
Nature-based and natural climate solutions
We’re identifying opportunities for nature-based Aim to enable and shape the market for high-
Championing solutions to address engineering, environmental and quality, certified natural climate solutions
social challenges in the areas where we work
nature-based
• Active in policy advocacy and participation in groups,
• We will work with our partners, including Fauna & including Natural Climate Solutions Alliance
solutions
Flora International, to incorporate these into plans
and aim to generate local co-benefits to people and • We only invest using a list of bp-approved third-party
biodiversity developed carbon certification standards
Our aim 18 is championing • Attractive business opportunity, in which we have
track record and capability
nature-based solutions and Our initial focus for nature-based solutions is on
enabling certified natural natural climate solutions – >50Mte of US forestry offsets
climate solutions. • These are focused on actions to reduce or remove – Originated projects in six countries
GHGs through conservation, restoration and
Objectives improved land management • Investments are geographically diverse and strive to
achieve environmental and social benefits
1. To use nature-based solutions to
deliver value and contribute to our
people and planet aims.
We do not plan to rely on offsetting to meet our Finite Carbon
2. To enable emission reductions
2030 net zero aims • Largest US developer of forest carbon offsets
through investments in certified • Acquired a majority stake in 2020, bringing into
natural climate solutions. We think it makes sense to account for carbon
credits directly related to our business, for example our in-house business accelerator Launchpad
where carbon credits are bundled with the energy • In 2021, launched a forest carbon offset
we sell, and looking ahead we plan to do so. programme in Canada
Go deeper Sustainability Report page 45 36Embedding
sustainability
37| Environmental | Social
Social | Governance
Governance
Culture
We are transforming the culture and We need a motivated, engaged and
how it feels to work at bp diverse workforce Since joining bp, I have always been impressed at the
• Greater integration, leaner with reduced • Evolving a model of continuous planning strength of the company’s culture – open, co-operative,
tiers of management, more agile and open, transparent, real-time feedback collaborative and performance-focused. Rather than weaken
that culture, I believe that the pandemic has strengthened it
• Selecting leaders reflecting; • Developing a skills learning culture further – and has proved its value. bp would not have
‒ A track record of delivery • Flexible working achieved all it did in 2020 without such a strong culture.
‒ Curious and open-minded • UK Living Wage Helge Lund
Employer accredited bp Chairman
‒ Purpose-driven
by the Living Wage
‒ Lead through our values – Foundation Supporting wellbeing and mental health (Aim 15)
especially safety
‒ Reviewing our approach elsewhere • 2025 target to launch a comprehensive health & wellbeing
‒ Empathetic
programme for employees and families
• By 2023, set targets / aims that foster a culture of care and
encourage discussion of mental health issues
Sustainability in our culture
• We are working to embed sustainability more deeply into
our culture and mindset, decision making, systems and
processes, and governance.
• In 2021 we ran awareness sessions for employees and
updated the training we provide on our values and code of
conduct, to emphasize the importance of sustainability.
Go deeper Sustainability Report pages 40 & 48 38| Environmental | Social
Social | Governance
Governance
Capability
Evolving our capabilities, building on strong foundations
• We have deep technical expertise and extraordinary capabilities across a Our objective is to enable a
diverse global workforce just transition for the workforce
‒ Thousands of engineers, scientists, and other highly-skilled people • Included within aim 12 –
to support a just energy
‒ Experience delivering large, complex projects
transition
‒ Strong global relationships
• By 2023, we will develop
• We are taking skills from our existing businesses to use in a reinvented bp and publish 2025 and 2030
‒ Applying skills gained in one field that are directly applicable to metrics and targets for
another education & employment
initiatives and programmes
• We are in action to acquire new capabilities needed to deliver on our
with industry partners to;
strategy
‒ Reskilling our own people ‒ Work with early-stage talent to engage their interest in and
develop the skills needed for the future energy system
‒ Hiring individuals from outside our industry with skills and experience
we don't have ‒ Advance social mobility, specifically targeting disadvantaged
groups in our education & employability work
‒ Develop initiatives and just transition plans for the areas most
Developing a culture in which continuous skilling,
impacted by the energy transition
reskilling and upskilling is the norm
• On-the job-learning, coaching, relationships with mentors, and learning and
talent programmes.
• Skills clusters to help build deep capability in a range of technical,
functional and leadership areas
• Emphasis on digital, agile and low carbon
Go deeper Sustainability Report pages 35 & 48 39| Environmental | Social | Governance
Governance
Remuneration
Incorporates environment and safety measures and reflects strategy
Annual bonus Safety Environment Operational performance Financial performance
Applicable to over half of our global workforce,
including executive directors
15% 15% 20% 50%
‒ Tier 1 and 2 process ‒ Sustainable ‒ bp operated plant ‒ Free cash flow (25%)
Tied to a balanced scorecard consisting of safety safety emissions reductions reliability and refining
‒ Cumulative cash
availability (10%)
and sustainability, operations and financial measures costs reductions
‒ Margin share from (25%)
convenience and
electrification (10%)
Performance shares
For executive directors’ (CEO & CFO) long term Relative TSR Financials (ROACE) Growth (EBIDA CAGR) Strategic progress
incentive plans, commencing in 2022
Improved disclosures for long-term incentive targets
20% 20% 20% 40%
Demonstrate track record, Accelerate growth in Resilient hydrocarbons
scale and value in low convenience and mobility
carbon energy
Electric vehicle charge Production cost per barrel
Gigawatts of developed points Plant reliability
renewable energy to Final Strategic convenience
Investment Decision Refining availability
sites
Bioenergy Margin share from
LNG portfolio convenience and
electrification
Go deeper Annual Report page 116 40| Environmental | Social | Governance
Governance
Board and bpLT governance
Climate-related matters and sustainability
Board level bp board level
New terms of reference and roadmap of activity Safety andcases more than $3 billion for resilient hydrocarbons,People and
Reviews investment
moresustainability
Audit Remuneration
than $1 billion for all transition or low carbon investments and governance
• Regular review process across purpose, strategy, culture and Board
committee committee
any significant inorganic acquisition
committee that is exceptional or unique in nature.committee
values, while maintaining oversight of performance
• Climate-related risks and opportunities were discussed at every EVP level
board meeting covering strategy, of which six were held in
2021
CEO
Group
Safety and sustainability committee Group Resource Issues and
operational and
sustainability commitment advocacy
Updated accountabilities financial risk
committee meeting meeting
bp leadership committees
• Remit extended to provide oversight of the effectiveness of the
implementation of bp’s sustainability frame, including reviewing team
that appropriate progress is being made against net zero,
people and planet aims
SVP level
• Committee will continue to cover existing safety and
sustainability-related activities, including the oversight of
operational safety and sustainability risks Sustainability forum Production & operations carbon table
Executive level
Cross bp forums and meetings
New group sustainability committee
• Will oversee and review sustainability matters, including those Meetings and forums to allow cross-group discussions and integration.
that are climate-related
Go deeper Annual Report pages 52-53 41Appendix
42| Environmental
Environmental | Social | Governance
Aims summary: Get bp to net zero
Net zero Net zero Net zero Reducing More $ for
operations production sales methane new energies
Our aim 1 is to be net Our aim 2 is to be net Our aim 3 is to reduce Our aim 4 is to install Our aim 5 is to
zero across our entire zero on an absolute to net zero the carbon methane measurement increase the proportion
operations on an basis across the intensity of the energy at all our existing major of investment we
absolute basis by 2050 carbon in our upstream products we sell by oil and gas processing make into our non-oil
or sooner. oil and gas production 2050 or sooner. sites by 2023, publish and gas businesses.
This aim relates to Scope 1 and 2 GHG by 2050 or sooner. This is a lifecycle carbon intensity
the data, and then drive Over time, as investment goes up in low
emissions (around 55MteCO2e
in 2019). This is our Scope 3 aim and is on a bp
approach, per unit of energy. It covers a 50% reduction in and zero carbon, we see it going
equity share basis excluding Rosneft
(361MteCO2 in 2019).
our marketed and physically traded sales
of energy products. (79.3gCO2e/MJ in methane intensity of down in oil and gas.
2019).
our operations.
And we will work to influence our joint
ventures to set their own methane
intensity targets of 0.2%.
Contribution to our aims
Get bp to net zero More clean energy Sustainable livelihoods Enhance wellbeing Unlock circularity
43
Help the world get to net zero Just transition Greater equity Nature Sustainable purchasing| Environmental
Environmental | Social | Governance
Aims summary: Help the world get to net zero
Advocating Incentivizing Aligning Transparency Clean cities
employees associations leader and corporates
Our aim 6 is to more Our aim 7 is to Our aim 8 is to set Our aim 9 is to be Our aim 10 is to launch
actively advocate for incentivize our global new expectations for recognized as an a new team to create
policies that support workforce to deliver on our relationships with industry leader for the integrated clean
net zero, including our aims and mobilize trade associations transparency of our energy and mobility
carbon pricing. them to become around the globe. reporting. solutions.
We have stopped corporate
advocates for net zero. We will make the case for our On 12 February 2020, we declared We launched our regions, cities and
reputation advertising campaigns views on climate change within the our support for the recommendations solutions team in 2020. It will help
and this is enabling us to redirect This will include continuing to allocate of the Task Force on Climate-related countries, cities and corporations
associations we belong to and we
resources to promote well designed a percentage of remuneration linked Financial Disclosures (TCFD). around the world decarbonize.
will be transparent where we differ.
climate policies. In future, any to emissions reductions for leadership We intend to work constructively with
And where we can’t reach alignment,
corporate advertising will be to and around 28,000 employees. the TCFD and others – such as the
we will be prepared to leave.
push for progressive climate policy; Sustainability Accounting Standards
communicate our net zero ambition; Board – to develop good practices and
invite ideas; or build collaborations. standards for transparency.
We will continue to run recruitment
campaigns and advertise our products,
services and partnerships – although we
aim for these to increasingly be
low carbon.
Contribution to our aims
Get bp to net zero More clean energy Sustainable livelihoods Enhance wellbeing Unlock circularity
44
Help the world get to net zero Just transition Greater equity Nature Sustainable purchasing| Environmental | Social
Social | Governance
Aims summary: Improve people’s lives
More clean Just Sustainable Greater Enhance
energy transition livelihoods equity wellbeing
Our aim 11 is to Our aim 12 is to Our aim 13 is Our aim 14 is greater Our aim 15 is to
develop enough clean support a just energy helping more than diversity, equity & enhance the health
transition that 1 million people inclusion for our and wellbeing of our
energy to benefit more advances human build sustainable workforce and employees,
than 36 million people. rights and education. livelihoods and customers, and to contractors and
By 2030 we aim to have developed We support the Paris Agreement, resilience. increase supplier local communities.
50GW of renewable generating capacity
– broadly enough to meet the power
which recognises the importance of a
just transition – one that delivers decent We will support the communities where diversity spend to $1
needs of 36 million people, including
exploring ways to make clean energy
work, quality jobs; and supports the
livelihoods of local communities.
we work to build greater resilience
and more sustainable livelihoods.
billion. We will support them to proactively
improve their physical and mental
We’ll focus our social investment in health – through innovative
accessible to those who need it most. We want our workforce and customers
To support a just energy transition, we support of our sustainability aims. programmes, partnerships and offers.
Through these actions we aim to reach to experience greater equity – fair
aim to collaborate with key stakeholders treatment according to everyone’s
and other industries to support the more than 1 million people. We will
also support our workforce through different needs and situations – while
advancement of human rights through also helping our partners in the bp
the transition. We’ll do this by developing quality jobs with fair conditions.
‘ecosystem’ do the same. We’ll aim
just transition plans in priority areas and to do this by improving workforce
helping the workforce to develop skills diversity and workplace inclusion,
for the future energy system, taking a making customer experiences
socially inclusive approach. We aim to more inclusive and increasing our
build stronger relationships with local annual expenditure with diverse
communities, based on mutual trust and suppliers, including female, and
respect, and will support civic dialogue, underrepresented or minority groups
greater transparency and capacity (supplier diversity) to $1 billion
building, where we work. by 2025.
Contribution to our aims
Get bp to net zero More clean energy Sustainable livelihoods Enhance wellbeing Unlock circularity
45
Help the world get to net zero Just transition Greater equity Nature Sustainable purchasing| Environmental
Environmental | Social | Governance
Aims summary: Care for our planet
Enhancing Water Championing Unlock Sustainable
biodiversity positive nature-based circularity purchasing
solutions
Our aim 16 is making a Our aim 17 is Our aim 18 is Our aim 19 is to unlock Our aim 20 is
positive impact becoming water championing nature- new sources of value developing a more
through our actions to positive by 2035. based solutions and through circularity. sustainable supply
restore, maintain and We aim to replenish more freshwater enabling certified We want to keep materials in use for chain.
enhance biodiversity than we consume in our operations.
We will do this by being more
natural climate longer and value them throughout
their lifecycle. We’ll do this by using We will work with our key suppliers to
where we work. efficient in operational freshwater use
and effluent management, and by
solutions. resources responsibly and embracing
circular principles in design, operations
embed sustainable practices, focusing
on reducing greenhouse gas emissions
collaborating with others to replenish We aim to use nature-based solutions and decommissioning and aim to work and increasing the circularity of what
We will do this by putting our freshwater in stressed and scarce with partners and our joint ventures to
biodiversity position into action. In doing (NbS) to deliver value and contribute we buy.
catchment areas where we operate. to our people and planet aims in our create opportunities.
so, we expect that from 2022 all new bp
projects in scope will have plans in place operations and through our business
activities. We will also support the
aiming to achieve net positive impact
development of scalable markets for
(NPI), with a target to deliver 90% of certified natural climate solutions that
actions within five years of project help the world reduce deforestation,
approval. We also aim to enhance get to net zero and deliver
biodiversity at our major operating sites environmental and social benefits.
and support biodiversity restoration
and sustainable use of natural resource
projects in the countries where we
have current or growing investments.
We will also continue to work with
others, including our joint ventures, to
influence and promote collective action
on biodiversity.
Contribution to our aims
Get bp to net zero More clean energy Sustainable livelihoods Enhance wellbeing Unlock circularity
46
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