Apr 4, 2017

BP ready to cut CEO Dudley’s maximum pay by $3.7m

BP is set to cut chief executive Bob Dudley's maximum pay by up to $3.7m over the next three years as it seeks to avert a fresh rebellion from investors. The move, expected to be revealed when the oil company publishes its new pay policy later this week, comes as companies try to avoid a repeat of last year's shareholder revolts, when investors rejected pay plans at seven of the biggest US companies and three of the UK's largest groups, including BP. Almost 60 per cent of BP investors voted against a 20 per cent increase to nearly $20m in Mr Dudley's pay for 2015 - a year in which he led the group to its worst ever loss. Under the terms of the new pay package, which was first reported by Sky News, Mr Dudley's maximum award under the oil company's long-term incentive plan would be reduced from seven times his basic salary, currently $1.85m, to five times. The reduction would take Mr Dudley's maximum pay package, excluding pension contributions, from $19m to $15.3m. Mr Dudley was awarded $13.1m last year, plus pension contributions of $6.5m. The average payout from these schemes over the past five years has been around 40 per cent. Last week, consumer goods group Reckitt Benckiser announced it had cut its chief executive's 2016 pay by more than a third, denying him a bonus and slashing his long-term incentives, after nearly a fifth of his investors objected to his £25.5m pay package the previous year.

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