BP CEO Shouldn't Get 20% Raise After $5.2B Loss: Investors

But vote's nonbinding, so looks like Bob Dudley will get his full bonus
By Jenn Gidman,  Newser Staff
Posted Apr 14, 2016 1:51 PM CDT
BP CEO Shouldn't Get 20% Raise After $5.2B Loss: Investors
In this March 6, 2013, file photo, BP CEO Bob Dudley speaks at the IHS CERAWeek energy conference in Houston.   (AP Photo/Pat Sullivan, File)

Oil giant BP lost $5.2 billion last year, but the company somehow saw fit to propose maximum bonuses for 2015 for its top executives, including a 20% pay increase for CEO Bob Dudley—a proposal that 59% of shareholders roundly rejected by proxy vote at Thursday's annual meeting, MarketWatch reports. The company had indicated earlier in the day that it may also have to reduce its dividend, the Wall Street Journal reports. Dudley is set to receive the full bonus he was eligible for, which comes to $4.2 million (including $1.4 million in cash and a portion in deferred BP shares), per an earlier MarketWatch report. This amount was bumped up from the $3 million ($1 million in cash) he received in 2014. BP's CFO was also on the list to rake in his full bonus. "We think it sends the wrong message," a rep for shareholder Royal London Asset Management tells the BBC. "It shows that the board is out of touch."

Not only did BP suffer straight-up monetary losses as the price of oil fell, it also announced it will be getting rid of about 7,000 jobs and taking other belt-tightening measures. And the Financial Times notes that other energy company execs saw their pay slashed in 2015. But a BP spokesman says "executives performed strongly in a difficult environment in 2015, managing the things they could control and for which they were accountable." Andy Critchlow, writing for the Reuters Breakingviews blog, agrees. "Dudley has to work harder than his predecessors," he writes, noting the CEO has helped the company recover from the 2010 Deepwater Horizon disaster and improved safety protocol. "The mild-mannered American has had possibly the toughest job in the oil industry. His rewards look in line with that task." Carl-Henric Svanberg, chairman of BP's board, says the nonbinding shareholder vote won't alter the payouts they've already decided on, but that the board will take investors' concerns into account when coming up with next year's compensation packages. (More British Petroleum stories.)

Get the news faster.
Tap to install our app.
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.