BP is ready to address its investors as its top executive prepares to receive a large special bonus of £11.4 million. The payment would be in shares, apart from his £1.38 million salary and annual bonus for 2022.
Bernard Looney is expected to receive a multimillion-pound bonus from a three-year share award plan established in 2020, as the company was in the process of laying off workers when the global lockdown was imposed, thanks to the strong growth in its share price.
Gas prices have soared as a result of the Russia-Ukraine war; as a result, BP said that its yearly profit had grown more than twice as much to $28 billion (£23 billion), which caused the share price to rise by more than £5.50.
Before the release of its annual report in early March, in which Looney’s remuneration would be confirmed, BP aggressively solicited feedback from its investors. According to some shareholders’ requests, the company will consider improving transparency on executive pay.
One of the leasing shareholders informed the Sunday Times regarding the potential bonus that rewards at the top of the range provided by the incentive program would be equivalent to “quite a blatant grab” given the surge in oil and gas prices.
BP would face pressure regarding the executives’ pay, and other players such as Shell would be facing a tougher windfall tax due to surging gas prices since the oil firms are profiting from increased prices as many people and businesses struggle with a dramatic increase in energy costs.
A senior climate campaigner at Greenpeace UK, Charlie Kronick, stated: “These bumper bonuses would be a slap in the face for millions of UK people struggling with their bills and communities around the world reeling from the climate crisis… Instead of being stuffed in the pockets of shareholders and company bosses, all this extra cash should be redirected towards public goods, whether it’s insulating UK homes or supporting communities suffering the consequences of the oil industry’s carbon pollution.”
The three-year plan evaluates several critical factors, such as progress in the reduction of carbon emissions, return on capital, and comparison with shareholder return at similar companies like BP. Looney is empowered to receive a maximum of 500% of his salary.
Looney was allowed a maximum of 2,076,677 performance shares worth just under £6.4 million, with each share worth £3.08 as per BP’s previous annual report of August 2020.
The share price of BP closed at £5.51 on Friday; thus, Looney will be paid a little over £11.4m based on the price of shares and considering the 2020–2022 share plan payout.
Looney’s total income skyrocketed to almost £4.5m in 2021, a boost of £2.4m in annual bonuses from his previous £1.3m salary based on financial performance, along with shares of performance worth £493,000 from a prior plan. As per the new three-year annual plan, the executive is bound to receive share awards every year.
When asked about Looney’s pay, the BP spokesperson refrained from commenting and stated, “The full details of directors’ pay will be included in the annual report, which will be published in the first half of March.”
- Published By Team Timeswire