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Financial Times: BP top executives outstrip their Shell counterparts on pay

Mar 15th, 2006
by admin.

By Thomas Catan
Published: March 15 2006 02:00 | Last updated: March 15 2006 02:00
Senior executives at Royal Dutch Shell saw their pay generally lag behind their counterparts at BP.
That was in spite of a year of record profits at both companies, according to annual reports published by both oil majors yesterday.
Shell executives in general received lower pay than their BP equivalents after missing out on pay-outs from their long-term incentive plan, which are linked to total shareholder return.
The company is still suffering the after-effects of the reserves accounting scandal in 2004, when it admitted to having overstated its oil and gas reserve estimates. However, Jeroen van der Veer, Shell's chief executive- appointed following the scandal, was paid £2.4m in salary, fees, bonus and benefits, up from £1.8m the year before.
Mr Van der Veer's base pay rose 3.3 per cent, broadly in line with inflation.
However, Peter Voser, chief financial officer, received a 7.6 per cent pay raise to bring him into line with his peers at other companies, Shell said.
BP cut Lord John Browne's bonus from £2.3m to £1.8m following an explosion at the company's Texas City refinery, production losses during the hurricanes in the Gulf of Mexico and expensive repairs to its Thunder Horse platform.
Even so, Lord Browne's total compensation rose by nearly 14 per cent to £6.5m.
BP's remuneration committee said it had considered the performance of its executives in the light of “significant events during the year, both positive and negative”.
It cited the sale of BP's petrochemical unit, Innovene, the Texas City blast and repairs to the Thunder Horse platform in the Gulf of Mexico, which listed badly after an accident.
Both Shell and BP reported record profits last month, driven by higher oil and gas prices.
However, the two companies' production was hit by the hurricanes in the Gulf of Mexico.
Shares in Shell closed down 5p at £18.50, while BP rose 1½p to 651p.

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