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BP chief executive Bob Dudley’s pay package fell by 40 per cent to $11.6m last year and the total amount he can earn in future has also been reduced, as the oil major seeks to avoid another damaging shareholder revolt over executive remuneration.
Mr Dudley has become a lightning rod for controversy over executive pay in the UK because his remuneration soared while BP’s profits and production plummeted in the recent years after the group’s deadly Deepwater Horizon explosion and oil spill in the Gulf of Mexico.
Criticism peaked last year when Mr Dudley received a 20 per cent pay increase for 2015 despite BP reporting a record annual loss. Almost 60 per cent of proxy votes cast at BP’s annual meeting last year went against the award in one of the biggest shows of dissent on pay by shareholders in a large UK company.
Unlike last year’s non-binding protest vote, BP’s board will be bound by the outcome of this year’s vote on its new pay policy at its annual meeting in London next month*.
Carl-Henric Svanberg, BP chairman, and other directors have been engaging intensively with investors in a bid to avoid a repeat of last year’s conflict.
*This post has been amended to correct the date of the meeting.