Energy giant BP just raised CEO Bob Dudley’s total pay package by a huge 20% to
This is despite BP losing $5.2 billion in 2015 due to the oil price crash that saw oil falling from triple digits in the summer of 2014 to around $35 per barrel right now.
In BP’s annual report, the company’s board stressed that no executives had a salary increase in 2015 and wouldn’t in 2016 either.
However, while his base salary remains at $1.8 million, the rest of the $19.6 million for his total pay package is made out of bonuses, share awards, and pension investments.
In other words — his salary stayed the same but his bonus and other elements of his pay deal increased.
The company defended the move in its annual report by saying that the pay package was because of Dudley’s improvements to the company’s safety, project management and cost-cutting.
“Despite the very challenging environment, BP delivered strong operating and safety performance throughout 2015 and responded early and decisively to the steep fall in oil price” said Ann Dowling, chair of BP’s remuneration committee.
BP has been hit hard by the collapse in oil prices. It cut almost 5,000 jobs in 2015 and announced another 4,000 in January. Over last the last year, BP shares have fallen by over 18%:
Despite shareholder concern over stock prices and bonus remunerations, BP was adamant that it had to pay executives a competitive pay package in order to remain competitive and that it was still less than US oil companies.