Knowledge

BP Boss Faces Backlash Over 20% Pay Rise

The loss-making firm's AGM today will signal a revolt on its pay structure following Bob Dudley's £13.8m award.

BP's chief executive is expected to face anger from shareholders today as they vote on a 20% rise in his pay package for a year that saw the firm record its worst financial loss for 20 years.

Bob Dudley goes into the oil firm's AGM with criticism over a $19.6m (£13.8m) total remuneration from major shareholders and advisory bodies ringing in his ears.

The company, which has defended the increase as being in line with pay policies agreed by investors in 2014, argues it was justified following an "excellent" operating performance.

While shareholders will vote on the pay hike today - on the back of a 5% rise for Mr Dudley in 2014 - the result will not be binding but will set the scene for the next full pay policy vote due next year.

Mr Dudley, who has led BP since the aftermath of the Gulf of Mexico oil spill in 2010, was awarded a $1.4m (£990,000) bonus for 2015, while the value of his pension pot increased by $6.5m (£4.6m).

His enhanced pay package came in the same year that BP cut about 5000 jobs, including hundreds at its North Sea operations, and reported its biggest-ever annual loss - $5.2bn (£3.7bn) on a replacement cost basis, a measure used widely across the oil industry.

It blamed the collapse in world oil prices.

BP's shares fell 13% in 2015, while they are down by more than 23% over the last 12 months.

Shareholder group Sharesoc has branded Mr Dudley's pay deal as "simply too high"

The Institute of Directors said it feared an endorsement "could send the wrong message to other companies".

A spokesman for BP said: "Despite the very challenging environment, BP's safety and operating performance was excellent throughout 2015 and management also responded early and decisively to the steep fall in the oil price.

"BP's performance surpassed the board's expectations on almost all of the measures that determine remuneration - and the outcome therefore reflects this.

"And these clear measures derive directly from BP's remuneration policy which was approved by shareholders at the 2014 AGM with over 96% of the vote."

Case Studies Background Image

More Knowledge

The Benefit of Using Norms Based Estimation

By embracing norms-based estimation and utilising iPlan software, organisations can optimise their STO events, reduce risks of cost overruns and delays, and drive continuous improvement. This approach provides a solid foundation for effective planning and execution, ultimately leading to increased STO efficiency and profitability for the asset owner operator by increasing the likelihood of successfully meeting the plant startup.
The origin of Permit-To-Work (PTW) systems

In the 1970s, the UK's Health and Safety Executive (HSE) introduced a permit to work system as part of its guidance on the Control of Major Accident Hazards (COMAH) regulations. This system required companies to obtain permits before carrying out certain types of work, and included detailed procedures for hazard identification, risk assessment, and permit issuance.
How iPlanSTO can help you streamline your STO events and achieve optimal performance

STO (Shutdown – Turnaround – Outage) events can be extremely challenging for companies, often resulting in significant downtime (planned & unplanned), lost revenue from loss of production (planned & unplanned), and an increase in safety risks. Here at IAMTech, we've developed a software solution that simplifies the planning and execution of STO events and helps you minimise downtime, reduce costs, and ensure compliance. With iPlanSTO, we're confident that we can help you streamline your STO events and improve your events performance.