BP shareholders vote to approve chief exec pay and a new remuneration policy at the firm's AGM

 
Courtney Goldsmith
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BP boss Bob Dudley said the firm made a lot of progress this year at today's AGM (Source: Getty)

Investors in BP approved an $11.6m (£9m) pay package for the company's boss after the oil major cut his pay in response to a shareholder revolt last year.

Shareholders at BP's annual general meeting (AGM) also approved a new remuneration policy that will reduce performance incentives by millions.

Chief executive Bob Dudley's pay was cut by 40 per cent after nearly 60 per cent of shareholders voted against a pay rise in 2015 amid the company's reports of record losses.

With the vast majority of votes counted, shareholders adopted BP's 2016 pay by a majority of just over 97 per cent, the highest in at least 10 years.

The new pay policy was voted in by a majority of over 97 per cent.

"At our meeting last year, you, our shareholders, sent us a very clear message on how we approached paying our executive directors," BP chairman Carl-Henric Svanberg said.

"We said we would listen and come back to you with a renewed policy for remuneration. You will have seen the steps we have taken this year and which we are proposing for the future."

Ahead of the AGM, Ashley Hamilton Claxton, corporate governance manager at Royal London Asset Management, which owns 0.73 per cent of BP's shares, said the oil major's remuneration committee did the right thing by significantly reducing pay going forward.

"Against the backdrop of a season of annual general meetings where companies have been doing the bare minimum to gain shareholder approval in 2017, BP has led the way and applied discretion to override the formulaic outcome of the pay policy."

Changes to the remuneration policy, which will affect Dudley and other executives' pay to 2019, include lowering Dudley's maximum long-term payout to five times salary from seven times, and cutting bonus payments by a quarter.

Despite the large cut, Dudley's pay is still well above that of rival European oil firms. Royal Dutch Shell's Ben van Beurden was paid €8.263m (£7m) for 2016 while Total's Patrick Pouyanne received €3.8m.

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