BP Plc (NYSE: BP) has agreed to cut about 5 million pounds (US$6.24 million) from CEO Bob Dudley's maximum pay for the next three years in a bid to avoid a shareholder revolt, Sky News said on April 3, citing people briefed on the matter.
Sky News said that Dudley's maximum annual pay over the next three years will now be about 12.2 million pounds (US$15.22 million) including his salary, an annual bonus of 3.3 million pounds and a long-term share incentive plan award worth up to 7.4 million pounds. The previous package was worth up to 17.4 million pounds including the matching share awards.
The report said the company had decided to reduce Dudley's maximum long-term incentive plan award from seven times his 1.48 million pounds basic salary to five times.
According to the report, Dudley's annual bonus will remain constant at a maximum of 225% of his salary. The framework will also apply to other top BP directors between 2017 and 2019.
BP has seen shareholder opposition to high executive pay since last April, when a majority of investors in BP voted down the oil company's plan to pay Dudley a US$19.6 million remuneration package, reflecting outrage over the proposed remuneration after the oil company posted losses.
According to an analysis by the Equality Trust in March, BP is among the British companies with the biggest pay gap between a worker on the minimum wage and the company heads.
A BP spokesperson was not immediately available for comment.