Sustainability at the heart of our strategy to deliver value to our stakeholders - Investor Pack | March 2021
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Sustainability at the heart of our strategy
to deliver value to our stakeholders
Investor Pack | March 2021 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 Last year, we announced our net zero ambition and
purpose, ambition, strategy and sustainability 10 net zero aims, with interim targets for 2025 and
frame, as well as a new financial framework and aims for 2030. We also launched our new
investor proposition. sustainability frame which connects the business
opportunities of the energy transition with
It was clear that we needed to change, for three
environmental and societal needs.
key reasons: we recognise that the world’s
carbon budget is finite and running out fast; In our 2020 sustainability report, we are pleased to
society is calling for different, more sustainable share our progress against our 2025 net zero
forms of energy; and this change represents an targets. We are also excited to set out 10 focused
enormous business opportunity for bp. aims – five for people and five for the planet – that
link our actions to a broad set of societal issues and
We are now focused on executing the strategy
complement our 10 net zero aims.
and growing long-term sustainable shareholder
value. We believe strong environmental, social and
governance performance benefits society, our
By 2030 we plan to be a very different kind of
employees and our shareholders. It creates
energy company; an Integrated Energy
resilience and enduring value across our activities –
Company, delivering integrated solutions for our
from more efficient operations through to unlocking
customers.
growth opportunities in the energy transition.
This presentation describes our approach and
And just as we have clear metrics for our financial
progress on ESG and the value it brings to our
performance, our new targets and aims can be used
stakeholders. It supports our investor proposition
to track our sustainability performance and inform
and underpins the transition story we have laid
engagement. They help show how purpose and
out so far. We look forward to continuing the
profit work together, delivering long-term value for
dialogue with you, our owners.
all our stakeholders.
Bernard Looney Giulia Chierchia
Chief executive officer EVP, strategy and sustainability
3
Contents
Context Get to net zero Improve 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 and inclusion Remuneration
Our strategy Methane Board & bpLT governance
Care for our planet
Our sustainability frame Investment allocation
Our planet aims
20 aims to deliver our sustainability frame Engagement
Biodiversity
Helping the world get to net zero
Water
Foundations
Disclosures Appendix
Nature-based and natural climate
Safety: Our core value
Partnerships solutions Summary of our aims
Value creation for our shareholders
and other stakeholders
4
Key references
Annual Sustainability ESG Reporting
report report data sheet centre
• Strategic report • Sustainability at bp • Net zero • All reports
• Corporate governance • Foundations • Greenhouse gas emissions • Policies and positions
• Financial statements • Our focus areas: net zero, • Safety • Frameworks and standards
• TCFD people and planet • Environment • Data and assurance
• Responses to the • Embedding sustainability • Social • Archives
requirements of the • External collaborations • Governance
CA100+ resolution • Our reporting
What is included in this report
This pack consolidates a number of aspects covered across our reports including those highlighted above, as at March 2021. In some cases this includes
simplification of more complex topics. Where a topic is covered in bp’s corporate reporting or other disclosures, its coverage there takes precedence over
this pack. For convenience this pack provides “Go Deeper” references to such disclosures where this may be particularly helpful, but these are not
comprehensive. 5
6
| Environmental | Social | 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
and not relying on
offsets out to 2030
Carbon reduction aims Five aims focused
for multiple points in the on helping the world
value chain: operations, get to net zero
production and sales
A new strategy from No exploration Material progress in
IOC to IEC to deliver on in new countries 2020 on Scope 1, 2 and
the aims and create long 3 and $750m low carbon
term value in the energy spend in 2020
transition
Expected 40% reduction Disciplined investment
in oil and gas production in low carbon expected
by 2030 to increase to $3-4bn by
2025 and ~$5bn by 2030
7
| Environmental | Social | Governance
Highlights
People and planet
Fewer people injured at Aiming for net positive Annual bonuses linked
work and a reduction in impact on biodiversity to safety (15%) and
process safety events in our new projects emissions reductions
in 2020 vs. 2019 (15%) metrics in 2021
Five new aims Water positive by 2035 -
to make a positive replenishing more
difference to the planet freshwater than we
and five to improve consume in our
people’s lives operations
Defined our aim to Mental health and New or enhanced
support a just transition, wellbeing placed at the disclosures in 2020,
including developing heart of our workforce including TCFD, SASB
skills for the future agenda and on tax transparency
energy system and trade associations
New extended
Driving actions to leadership team (top
support and shape the 120) – 37% women;
scale up of natural 28% ethnically diverse
climate solutions
Go deeper bp.com/sustainability 8
| Environmental | Social | Governance
Reimagining energy and reinventing bp
Long term value creation for all stakeholders
Purpose Strategy Financial frame Investor proposition
A coherent approach
to capital allocation
Committed distributions
1
Resilient dividend Profitable growth
Sustainable value
2
Strong balance
sheet
From an international oil company to an integrated energy 3
Investing at scale in
company delivering solutions for customers the energy transition
4
Ambition Sustainability frame Investing to maximize
value in resilient
Our ambition is to be a net hydrocarbons
zero company by 2050 or
5
sooner and to help the Share buyback
commitment
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.
9
| Environmental | Social | Governance
Our strategy
Low carbon Convenience Resilient and focused
electricity and energy and mobility hydrocarbons
▪ Low carbon electricity ▪ Advancing growth ▪ Continued rigour in safety
markets and operations
▪ Integrated gas
▪ Redefining convenience ▪ Driving emissions down
▪ Bio-energy
▪ Next-gen mobility ▪ Focused upstream and
▪ Hydrogen and CCUS refining portfolio
Integrating energy systems
Partnering with countries, cities and industries
Driving digital and innovation
A sustainability frame linking our purpose and
10Our strategy in action
Progress in 2020 and 1Q21
Alaska and
Resilient
and focused
4 Completion of ~20% ~7% petrochemicals 96% 94%
Southern Gas divestment refining plant
major project reduction in unit production
hydrocarbons start-ups
Corridor
Upstream capex cost reduction
& Kwinana refinery availability1 reliability2
conversion
More than Added ~300 Record
Jio-bp JV 1,400 EV Growing total Ultra-fast
doubled strategic convenience gross
Convenience completed charging points EV charging charger roll-
retail sites in convenience sites margin of $1.3bn,
and mobility growth markets
and rolled out with points
to now total 6% growth vs
out in UK and
operational DiDi JV in China to >10,000 Germany
to ~2,700 >1,900 2019
Low carbon bp and Equinor Lightsource bp Partnership Hydrogen Strategic
bp and EnBW enter growing solar to develop H2 Teesside and partnerships with
electricity UK offshore wind
strategic US offshore
pipeline in the US offshore CCUS partnership cities, corporates
wind partnership
and energy and Europe infrastructure with Ørsted & industries
(1) bp-operated refining availability (2) bp-operated Upstream plant reliability Note: All numbers as at 4Q20 Source: edited from 4Q20 results 11| Environmental | Social | Governance
Our sustainability frame
Our new 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 12| Environmental | Social | 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 oil and gas Aim 12: Just transition
Aim 3: Halving intensity 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
1314
| Environmental | Social | Governance
Foundations of our sustainability frame
Safety: Our core value at the heart of performance across bp
In 2020, compared to 2019; Reported recordable injury frequency Tier 1 and 2 process safety events
• Fewer people injured at work 2020 0.132 2020 17 53 70
• Reductions in tier 1 and
tier 2 process safety events 2019 0.166 2019 26 72 98
and serious vehicle accidents.
2018 0.198 2018 16 56 72
2017 0.218 2017 18 61 79
2016 0.211 2016 16 84 100
Tier 1 process safety events Tier 2 process safety events
Safety through technology Safety during the COVID-19 pandemic
Technology can play an increasingly effective We assessed changing circumstances and
role in reducing safety risk, including: responded to support and protect retail
• Selected sites use robotic crawlers to scan and operations workforces and
for defects; drones to inspect for leaks customers, including:
• Testing wearables to monitor fatigue and • Caring for our people
keep people out of harm’s way • Quarantining and testing procedures
• Big data and advanced analytics tools • Additional protective measures
Go deeper Sustainability Report page 16 15| Environmental | Social | Governance
Foundations of our sustainability frame
Value creation for our shareholders and other stakeholders
for society 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 2020 – Unlocking growth opportunities in the energy transition
$188.0bn through increasing customer demand for sustainable solutions
Suppliers
$165.4bn Sourcing goods and services from around 46,000 suppliers
• Trillions of dollars of investment opportunities required to rewire and
decarbonize the energy system and global economy
Employees •
$9.8bn Providing jobs for 63,600 people worldwide
bp 2020 Energy Outlook Rapid scenario, by 2050:
– Electricity demand doubles, renewables the clear winner
– Hydrogen accounts for 7-16% of final energy use
Governments
$3.3bn Contributing to economies through the taxes we pay – ~900 million EV passenger cars by 2040
Communities
•
$0.1bn Supporting additional initiatives to benefit the communities
where we operate
Mitigates and reduces risk
• Helps in attracting and retaining the best talent
Government support in 2020
bp did not seek any pandemic relief in the form of grants or furlough funding • Sustainability frame targets and aims enable performance to
from any governments anywhere be tracked
Go deeper bp.com/energyoutlook 1617
| Environmental | Social | Governance
Our net zero ambitions and aims
Our ambition is to be a net zero company by 2050 or sooner and to help the world get to net zero
50% reduction in carbon intensity of
the products we sell by 2050 or sooner
Net zero on an absolute basis across Measurement at all our major oil and gas processing sites
the carbon in our upstream oil and by 2023, transparent reporting and 50% reduction in our
gas production by 2050 or sooner operated methane intensity
Five aims to get
bp to net zero
Net zero across our entire Increase the proportion of
operations on an absolute investment into our non-oil &
basis by 2050 or sooner gas businesses
Five aims to get the
world to net zero More actively advocate for
policies that support net zero,
including carbon pricing
Launch a new team to create
integrated clean energy and
mobility solutions
Incentivise our global workforce to
deliver on our aims and mobilise them
to become advocates for net zero
Be recognised as an industry leader for the Set new expectations for our
transparency of our reporting relationships with trade associations
around the globe 18| Environmental | Social | Governance
Key principles to Paris consistency
We aim to be a
1. Informed by Paris-consistent energy transition scenarios
• The IPCC1 is the authoritative source on the evolving science of climate change and we use it and other
sources to inform our strategy
• They highlight a range of pathways by which the world can meet Paris, with differing implications for
regions, industries and sectors
• bp’s strategy is informed by these considerations and our Energy Outlook Rapid and Net Zero scenarios
which fall within the range of IPCC scenarios judged to be consistent with meeting the Paris goals
• It is designed to drive decarbonisation while remaining adaptable to the many potential Paris consistent
pathways the energy transition may take
2. Enables us to make a positive contribution to net zero
by 2050 or sooner and to help • Our net zero ambition is to become a net zero company by 2050 or sooner and to help the world get to
the world reach that goal net zero.
• Our strategy is designed to deliver long-term value while driving delivery of both parts of our ambition –
for bp and the world.
We believe bp’s strategy • It enables us to contribute to global net zero and meeting the Paris goals in several ways - including
action on GHG2 emissions, technology development, policy advocacy, low carbon collaboration,
and investments in low carbon
is consistent with Paris • Some ways to contribute are more readily measured quantitatively than others – but all are
important, whether or not they translate into GHG reductions for bp.
Targets & Aims Emissions Covered
3. Positions us to be resilient and successful in a Paris consistent world
Short-term (2025) Scope 1
• Our Paris consistent strategy is designed to position bp for success and resilience in a Paris consistent
Medium-term (2030) Scope 2 world – a world which is progressing on one of the many global trajectories that meets the Paris goals
• It is also designed to be resilient and flexible to manage uncertainty across scenarios, but is weighted
Long-term (20503) Scope 34
towards a rapid transition enabling bp to capture the huge opportunities we see in the energy transition
– and this is what we are advocating for
19
Go deeper Annual Report page 26 (1) Intergovernmental Panel on Climate Change (3) 2050 or sooner
(2) Greenhouse gases such as carbon dioxide (CO2) and methane (CH4) (4) Relates to Scope 3, category 11 (use of sold products)Go deeper GHG emissions | Environmental | Social | Governance
Scope 1, 2 and 3 emissions
Emissions Reductions
Scope Emissions Point in value chain 2020 Progress1 2025 Targets 2030 Aims 2050 Aims or sooner
Aim 1
Scope
1+2
Absolute
reductions
Operations 16% 20% 30-35% 100%4
Net zero across bp’s operations
on an absolute basis
Aim 2
Scope Upstream
3 2 Absolute
reductions
oil and gas
production
9% 20% 35-40% 100%5
Net zero on an absolute basis across
the carbon in our upstream oil and gas
production
Aim 3
Lifecycle3 Carbon
(including
Scope 32)
Intensity
reduction
Marketed
sales 0.6% 5% >15% 50%
50% reduction in carbon
intensity of the products we sell
Not relying on offsets out to 2030
(1) Emissions reductions versus 2019
(2) Relates to Scope 3, category 11 (use of sold products)
(3) Lifecycle metric, of which Scope 3 , category 11 (use of sold products) is a component
(4) Net zero, gross operated Aim 1 Aim 2 Aim 3 20
(5) Net zero, bp net equity, excludes Rosneft| 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 quantification to
relevant measurement
Our aim 4 is to install methane report methane drive action
sites by end 2023 approach by 2025
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 monetised
and then drive a 50% reduction
How we will meet our aim Our performance in 2020
in methane intensity of our
• Focus on achieving reductions • Improved methane intensity in 2020 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
0.12%2
2020
reduce methane and improve our • Collaboration with peers, NGOs, third-party experts and academic
ability to measure it institutions
0.20%
2025 Targets
(Aiming to have measurement
• Continue to support Zero Routine • Working with stakeholders such as EDF and OGCI and to work under the
approach in place by end 2023) Flaring by 2030 initiative Methane Guiding Principles
• Advocating for robust methane • Active contributor to the Oil and Gas Methane Partnership (OGMP),
Timeline to achieve policies version 2 – enhancing reporting and methane emission reductions
50%
reduction to follow 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 21
(2) 2020 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 4| Environmental | Social | Governance
Investment allocation
Key investment appraisal assumptions (2020 real) 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 that
Henry Hub gas
($/mmBtu)
3.00 3.00 3.00 3.00 2.75 is exceptional or unique in nature2
RMM 10 12 12 10 10
Upstream oil, refining, fuels (mature markets) 8-10% levered
our non-oil and gas with the Paris goals.
businesses.
Low carbon investment Capital expenditure Balanced investment criteria
Each of the new material capex investments
Organic and inorganic1
$750m
2020
approved in 2020 was evaluated to be consistent
• ~$9bn, oil, gas and refining with the Paris goals
• ~$2bn, convenience and
$3-4bn
2025 Targets
mobility
• ~$2bn, low carbon
…breaks new ground by developing a profitability
and carbon intensity test for projects under
~$5bn
2030 Aims
Exploration conditions which bp believes are consistent with the
• No new country entries Paris Goals [about 2019 report]
Statement by supporters of CA100+, press release (May 2020)
(1) 2021 guidance Go deeper Annual Report page 28 22
(2) All low carbon or transition and significant inorganic acquisitions that are exceptional or unique in nature| Environmental | Social | Governance
Engagement
Example: Climate Action 100+
Further enhancements in our 2020 reporting
We value direct engagement with shareholders and
through investor collaboration initiatives • Our second year responding to the 2019 resolution
• Response continues to evolve for elements of the resolution, including
2019 resolution on climate change disclosure requestioned by CA100+ and how bp evaluates new material capex investments for consistency with
supported by the bp Board the Paris goals.
• We welcome the opportunity to provide detail on the Paris-consistency Element of the CA100+ resolution
of our strategy and on our attractiveness as an investment proposition in
Strategy that the board considers in good faith to be consistent
the energy transition, and for continued investor engagement with the Paris goals.
• Provides the right balance between having a stable framework against How bp evaluates each new material capex investment« for consistency
which to deliver, and recognizing that the world is changing with the Paris goals and other outcomes relevant to bp strategy.
Disclosure of bp’s principal metrics and relevant targets or goals over
The resolution continues to add value and the dialogue with – and
the short, medium and long term, consistent with the Paris goals.
constructive challenge from – CA100+ makes us better
Anticipated levels of investment in:
(i) Oil and gas resources and reserves.
[The CA100+ 2019] resolution will have a vital part to play in supporting (ii) Other energy sources and technologies.
the company on its path to carbon neutrality.
bp’s targets to promote operational GHG reductions.
[net zero] announcements demonstrate the power of collaborative
engagement… Oil and gas companies have an important role to play Estimated carbon intensity of bp’s energy products and progress over time.
in the energy transition.
Any linkage between above targets and executive pay remuneration.
CA100+ investor comments, press release (Feb 2020)
Go deeper Annual Report page 27 23| Environmental | Social | Governance
Helping the world get to net zero
Aim 6 Aim 7 Aim 8 Aim 9 Aim 10
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 granular 2025 targets with Houston,
• Stopped corporate environment, reliability and • Exited three and aims for 2030 and Aberdeen, Microsoft &
reputation advertising performance associations following 2050, covering GHGs Qantas
• Advocating for carbon • Reinvent bp share scheme early review and business activities
pricing in the US further aligns employees to like renewables
strategic delivery development
What we intend to do
• Continue advocating for • Increase emphasis on • Continue to promote our • Annual 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
• Progress update on
(1) Task Force on Climate-related Financial Disclosures associations due in 2Q21 Go deeper Sustainability Report pages 43-49 24
(2) Sustainability Accounting Standards Board| Environmental | Social | Governance
Disclosures
Reporting frameworks Supporting
We aim to work constructively with the
TCFD and others – such as SASB – to
develop good practices and standards
for transparency
– Expanded TCFD disclosures in 2020
Our aim 9 is to be
– Using SASB standards for oil and gas to Core Measuring Stakeholder
recognised as an industry Capitalism metrics
develop useful disclosures for investors
leader for the transparency
of our reporting. Ratings agencies
Prioritising engagement with: Plan:
We are engaging with prioritised ESG ratings agencies
to enable our strategy and approach to sustainability to
be adequately reflected (BBB) Proactively engaging on
assessment of bp’s ESG
We plan to resume our reporting to CDP on the climate Sustainalytics (37.4) performance
change questionnaire in 2021
Resume reporting in 2021
Transparency
Published new tax transparency report in 2020 and
endorse the B Team Responsible Tax Principles
Payments to governments report for upstream projects
and operations Go deeper TCFD
Tax transparency
Founding member of the Extractive Industries
Payments to governments report 25
Transparency Initiative (EITI)| Environmental | Social | 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 migration of key bp data and applications
• Joining forces with Volkswagen to expand
new team to create ultra-fast EV charging across Europe
to Amazon Web Services (AWS) to
digitize bp infrastructure and operations
integrated clean energy
and mobility systems.
Why cities and corporates?
• Cities are home to half the
world’s population but aim 10
generate 70% of emissions Replace with
mobility image
• 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
with Equinor and UK with • Plan to work with Ørsted to
• Our products, services and Heavy transport EnBW – two of the best develop green hydrogen for
capabilities can support these
regions for the world’s our Lingen refinery
energy transition journeys • bp’s first decarbonisation partnership in fastest-growing energy
heavy transport with Qantas source • Partnered with DiDi to build an
In 2020, we launched our Regions, • Collaborate on sustainable fuels, advocacy, EV charging network in China
Cities & Solutions team renewable power, carbon management and
emerging technology
Go deeper Sustainability Report page 48 2627
| Environmental | Social | Governance
Our people aims
Develop enough clean
energy to benefit more than
36 million people
Enhance the health and wellbeing
of our employees, contractors and
local communities
Support a just energy
transition which advances
human rights and education
Greater diversity, equity & inclusion
for our workforce and customers,
and to increase supplier diversity Helping more than 1 million
spend to $1 billion people build sustainable
livelihoods and resilience
28| Environmental | Social | 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
• Vulnerable groups and individuals • Communities where we operate Slavery Principles
Our aim 12 is to support a just • Working with industry
• Freedom of expression • Clear expectations for engaging
energy transition which suppliers and business partners • Targeted due diligence
• Water & sanitation
advances human rights and assessments
• Land rights
education. • Independent assessments of
• Grievance mechanisms Policy conformance for selected
Objectives
sites / businesses
1. Enable just transition for the
workforce A clear plan to enable a just transition for the And we’re in action
2. Supporting civic dialogue, workforce
• Driving labour rights and modern slavery principles into
transparency and building local
capacity • By 2023, we will develop and publish 2025 and action across bp and with higher risk contractors and
2030 metrics and targets for education & suppliers.
3. Decent Work
employment initiatives and programmes with
• Working with contractors and suppliers in response to
industry partners
4. Respect and Remedy labour rights issues and modern slavery indicators
Ranked 7th of 199 major global companies by the • Rolling out human rights assessment platform
5. Responsible security
Corporate Human Rights Benchmark (CHRB)
2020 (and 2nd in our sector)
Go deeper Human rights
Human rights policy 29| Environmental | Social | Governance
Diversity and inclusion
bp’s success depends on having a talented and diverse 29
2020
workforce that represents the communities we serve 30
Our aim includes all aspects of diversity – including gender, 25
2019
race, ethnic minority, LGBTI+ and persons with disabilities. 25
Value from diverse set of expertise, views and perspectives 2018
24
24
Our aim 14 is greater diversity, Workforce by gender
2017 21
As at 31 December 2020 Female %
equity & inclusion for our 24
Board directors 45
workforce and customers, and 2016 22
Executive team 31
to increase supplier diversity 23
Group leaders 29
spend to $1 billion. Subsidiary directors 17
Women in group leadership
All employees 39 People from beyond the UK and US in group leadership
Objectives
1. Diverse workforce, inclusive 2020 performance
workplace culture and employee Next steps
experience • Percentage of women and individuals from countries
(includes all aspects of diversity – gender,
other than the UK and the US among bp’s group leaders • Publish our first annual D&I report - 2Q 2021
race, ethnic minority, LGBTI+, persons with
disabilities, etc.) increased in 2020 • We are working to reduce gender pay gap
2. Inclusive customer experience differences and recognize the long-term
(includes all aspects of diversity – gender, • Gender, ethnicity-and age diversity key metrics throughout
race, ethnic minority, LGBTI+, persons with the Reinvent selection process representation challenge we need to address
disabilities, etc.)
3. Multiply D&I impact through • Published our UK and US frameworks for action to help • Develop 2025 and 2030 D&I ambition and
ecosystem partners** and suppliers combat racial injustice targets on gender and racial diversity
• Listed in the Top Global Employers list by Stonewall - the
largest LGBT+ rights organization in the UK and Europe Go deeper Greater equity 3031
| Environmental | Social | Governance
Our planet aims
Making a positive impact through our
actions to restore, maintain and
enhance biodiversity where we work
Developing a more
sustainable supply chain
Becoming water
positive by 2035
Unlock new sources of
Championing nature-based
value through circularity
solutions and enabling certified
natural climate solutions
32| Environmental | Social | Governance
Biodiversity
We recognize the urgent need to conserve our
planet’s natural and cultural diversity
• New biodiversity position in 2020, building upon our
already robust practices across bp projects.
• “No go” commitment for oil and gas exploration
in the most sensitive protected areas1
• Three new objectives;
Our aim 16 is making a
positive impact through our – Net positive impact (NPI) from new projects
– Enhance biodiversity around existing major operating Partnering with Fauna & Flora International (FFI) to
actions to restore, maintain sites help support the delivery of our new position
and enhance biodiversity – Support biodiversity restoration and the sustainable
• NPI methodology expected by end 2021
use of natural resources projects in countries where
where we work. we operate • Working with FFI on nature-based solutions to help
Objectives
restore and protect existing forests
A clear plan to deliver with interim targets
1. bp projects:
• Expect that from 2022 all new bp projects in scope Actively involved in industry and cross-industry
Aim to achieve net positive impact (NPI)
will have plans in place aiming to achieve net initiatives to support biodiversity, including;
2. bp operations:
positive impact • Business for Nature call to action
Aim to enhance biodiversity
3. bp countries: • All major operating sites (MOS) in sensitive areas • UK Business & Biodiversity Forum
Support biodiversity restoration and the implementing enhancement plans by 2025; all MOS
sustainable use of natural resources by 2030 • Nature Action Project at World Business Council for
Sustainable Development (WBCSD)
• 5 projects involving local communities in progress
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 33
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 Our performance in 2020
consume in our operations
• 2% fall in freshwater withdrawals and a 17% fall in
We will do this by: freshwater consumption in 2020 vs. 2019
• improving the efficiency of operational freshwater1 • 4% of our total freshwater withdrawals were from
use and effluent management regions of high or extremely high water stress
• collaborating on projects, targeting opportunities to • 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 effluent – Vs. 2020 baseline, adjusting for portfolio change
management between 2020 and 2025
• Plan and set targets by 2025 for improved
2. Collaborate on the most impactful
operational efficiencies and collaboration
opportunities to replenish freshwater
in stressed and scarce catchments opportunities out to 2030
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 2021 and 2022
Go deeper Water positive 34
(1) Consistent of IPIECA definition of freshwater| 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-
solutions to address engineering, environmental and quality, certified natural climate solutions
social challenges in the areas where we work
• Active in policy advocacy and participation in groups,
• We will work with our partners, including Fauna & including Natural Climate Solutions Alliance
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 – >50 Mte of US forestry offsets
climate solutions. • These are focused on actions to reduce or remove – Originated projects in 6 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 intend to use offsets to meet our net Finite Carbon
2. To enable emission reductions zero targets or aims out to 2030 • Largest developer of forest carbon offsets in the
through investments in certified
US
natural climate solutions.
• Acquired a majority stake in 2020, bringing into
our in-house business accelerator Launchpad
• Invested to bolster expansion in new and
existing markets
Go deeper Sustainability Report page 71 3536
| Environmental | Social | 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
‒ Will define approach in 2022 programme for employees and families
• By 2023, set targets / aims that foster a culture of care and
encourage discussion of mental health issues
Offering support to employees leaving bp
• We used our relationships with external companies to
identify opportunities and facilitate introductions.
• Created a comprehensive programme offering the option to
retain a bp laptop, and provides coaching, wellbeing and
learning resources
• LinkedIn alumni base and regular newsletter
Go deeper Sustainability Report pages 63 & 80 37| Environmental | Social | 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
Developing a culture in which continuous skilling,
‒ Develop initiatives and just transition plans for the areas most
reskilling and upskilling is the norm
impacted by the energy transition
• 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 52 & 80 38| Environmental | Social | Governance
Remuneration
Incorporates environment and safety measures and reflects strategy
Safety Environment Operational performance Financial performance
Annual bonus
Applicable to over half of our global workforce, 15% 15% 20% 50%
including executive directors ‒ Tier 1/2 process ‒ Sustainable ‒ bp operated plant ‒ Free cash flow (25%)
safety emissions reductions reliability and refining
‒ Cumulative cash
Tied to a balanced scorecard consisting of safety availability (10%)
costs reductions (25)
and sustainability, operations and financial measures ‒ Margin share from
convenience and
‒ No annual bonus paid in 2020 electrification (10%)
Performance shares
Relative TSR ROACE Growth (EBIDA CGAR) Strategic progress
For executive directors’ (CEO & CFO) long term
incentive plans, commencing in 2021
20% 20% 20% 40%
Modifications for 2021-23 performance share
awards, in keeping with;
Low carbon electricity Convenience and mobility Resilient and focused
• The 2020 remuneration policy and energy hydrocarbons
• bp’s new strategy Gigawatts of developed Castrol performance Total cash costs relative
renewable energy to Final Convenience sites in to 2019
• Commitment to financial performance Investment Decision growth markets Plant reliability
Clear decisions on other Margin share from Refining availability
Qualitative assessment of strategic progress with energy platforms convenience and
a quantitative overlay based on key performance Pipeline electrification
indicator
Go deeper Annual Report page 103 39| Environmental | Social | Governance
Board and bpLT governance
Climate-related matters and sustainability
Board level bp board
New terms of reference and roadmap of activity
Reviews investment
Safety and cases more than $3 billion for resilient hydrocarbons, People and
Remuneration
• Regular review process across purpose, strategy, culture and Board more than $1 billion for all transition
sustainability or low carbon committee
Audit committee investments and governance
committee
any significant inorganic acquisition that is exceptional or unique in nature. committee
values, while maintaining oversight of performance
• Climate matters included on the agenda at every board meeting EVP level
in 2020
bp leadership team Group Issues and Corporate Group operational
sustainability advocacy reporting steering risk committee
committee meeting group Chair: CEO
Safety and sustainability committee Chair: EVP S&S Chair: EVP S&S, Chair: CFO, EVP Oversight of the
Oversight of EVP C&A C&A, EVP S&S group’s
Updated accountabilities sustainability policy and advocacy Development and safety and
matters. issues, oversight operational risk
• Remit extended to provide oversight of the effectiveness of the including those of financial and non- management
implementation of bp’s sustainability frame, including reviewing related to financial performance,
climate matters. reporting, including safety agenda and
that appropriate progress is being made against net zero, TCFD. priorities
people and planet aims
• Committee will continue to cover existing safety and SVP level
sustainability-related activities, including the oversight of Sustainability forum Production & operations carbon table
operational safety and sustainability risks Chair: SVP sustainability Chair: SVP HSE & carbon, P&O
Focused on sustainability plans and progress. Brings Focuses on the delivery of lower carbon plans in P&O
together previously separate committees, including carbon – particularly in relation to net zero aims 1 and 4.
steering group, policy and advocacy, and human rights.
Executive level
New group sustainability committee Cross bp meetings and forums
• 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 4041
| Environmental | Social | Governance
Aims summary: Get bp to net zero
Our aim 1 is to be net Our aim 2 is to be net Our aim 3 is to cut the Our aim 4 is to install Our aim 5 is to
zero across our entire zero on an absolute carbon intensity of the methane measurement increase the proportion
operations on an basis across the products we sell by at all our existing major of investment we
absolute basis by 2050 carbon in our upstream 50% by 2050 or oil and gas processing make into our non-oil
or sooner. oil and gas production sooner. sites by 2023, publish and gas businesses.
This aim relates to Scope 1 and 2 GHG by 2050 or sooner. This is a life cycle 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).
marketing sales of energy products and
potentially, in future, certain other methane intensity of down in oil and gas.
products, for example, associated with
land carbon projects (79.3gCO2e/MJ in
our operations.
2019).
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
42
Help the world get to net zero Just transition Greater equity Nature Sustainable purchasing| Environmental | Social | Governance
Aims summary: Help the world get to net zero
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 28,000a 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 a Thisfigure was around 37,000 in February 2020.It is
low carbon. approximate and has been revised in line with
restructuring as part of reinvent bp and reflects lower
headcount overall.
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 | Social | Governance
Aims summary: Improve people’s lives
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
We have stopped corporate We support the Paris Agreement, resilience. increase supplier local communities.
reputation advertising campaigns
and this is enabling us to redirect
which recognises the importance of a
just transition – one that delivers decent We’ll support the communities where diversity spend to $1
resources to promote well designed
climate policies. In future, any
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
corporate advertising will be to We want our workforce and customers
To support a just energy transition, we support of our sustainability aims. programmes, partnerships and offers.
push for progressive climate policy; to experience greater equity – fair
communicate our net zero ambition; aim to collaborate with key stakeholders Through these actions we aim to reach
more than 1 million people. We will treatment according to everyone’s
invite ideas; or build collaborations. and other industries to support the different needs and situations – while
advancement of human rights through also support our workforce through
We will continue to run recruitment quality jobs with fair conditions. also helping our partners in the bp
the transition. We’ll do this by developing ‘ecosystem’ do the same. We’ll aim
campaigns and advertise our products,
just transition plans in priority areas and to do this by improving workforce
services and partnerships – although helping the workforce to develop skills
we aim for these to increasingly be diversity and workplace inclusion,
for the future energy system, taking a making customer experiences
low carbon. 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
44
Help the world get to net zero Just transition Greater equity Nature Sustainable purchasing| Environmental | Social | Governance
Aims summary: Care for our planet
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 life cycle. We’ll do this by using We’ll 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
45
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