BP to award executive bonuses despite threat of shareholder backlash

BP has ignored a potential shareholder rebellion and agreed to award bonuses to executives following its annual general meeting.

Nearly four in 10 shareholders voted against the group’s remuneration package, which will see four current and one former executive director receive a bonus worth 15% of their salary.

Chairman Peter Sutherland acknowledged the investors’ anger over the decision. Shareholders were also angry over his role as non-executive director at the Royal Bank of Scotland, which had to be rescued by taxpayers last year.

A BP spokesman told Personnel Today that firm’s bonus scheme was discretionary and based on company performance over a three-year period. The current scheme began in 2006 and did not pay out for the first two years.

“It was only because of the particularly good performance in the most recent of the three-year rolling plan [2008] that the remuneration committee decided to award the bonus,” he said.

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Tony Hayward, the company’s chief executive, will receive bonus shares worth £336,000 for 2008.

In February, the petrol giant announced it was freezing the salaries of virtually all senior and middle managers in the UK, although staff bonuses would still be paid for 2008.