Little stepped down as head of Canada’s third-largest oil producer on Friday, a day after a worker was killed at Suncor’s oil sands base plant in northern Alberta.
It was the fifth fatality at a Suncor site since 2019, when Little became CEO, and the thirteenth since 2014.
“This level of events is something we have never seen in the 25 years of covering the sector,” Phil Skolnick, an analyst at investment dealer Eight Capital, wrote in a note to clients.
“This is not just the CEO’s fault… Ultimately, we believe a meaningful overhaul will be needed; and we see that taking time and money.”
Little was already under pressure from U.S. activist investment firm Elliott Management, which in April disclosed a 3.4% stake in Suncor and called for a management overhaul, new board members and improved operating performance.
Elliott also highlighted Suncor’s poor safety record and its share price underperformance versus rival oil sands producers.
Elliott did not immediately respond to a request for comment. Suncor could not immediately be reached for comment.
Daniel Loeb’s investment firm Third Point also revealed a stake in Suncor in May, acquiring 3.5 million shares.
Capital Eight and brokerage Raymond James both downgraded Suncor’s stock on Monday. The company’s shares were last down 1.9% on the Toronto Stock Exchange at $41.62.
Calgary-based Suncor, which is a also refiner and owns one of Canada’s largest retail fuel networks, named Kris Smith, executive vice president of downstream, as interim CEO while the board searches for a replacement for Little.
National Bank analyst Travis Wood said the next CEO will likely come from outside the company and needs to execute a long-term cultural shift across the 17,000-strong workforce.
“The size, scale and integrated nature of Suncor’s operations is another reason we do not believe the blame should fall on one person, leaving us to consider that additional executive changes will likely be required,” Wood said in a note.
“There is no easy fix.”