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14/03/2002
BP Chief Executive's pay rise creates "fattest cat"
BP Chief Executive Lord Browne has received a 58 per cent pay rise that has taken his salary to over £3 million, leading to criticism from unions that BP has created the "biggest fat cat" of them all.
The company's annual report revealed that Lord Browne's salary increased to over £3 million during 2001, thanks to a rise in basic pay – from £869,000 to £1.2 million – a performance bonus and expenses, in addition to shares worth over £2.5 million. When his 1.2 million share options are also factored in, the chief executive's total benefits package stands at just over £6 million.
General Secretary of the Transport and General Workers Union, slated the development, saying: "Some fat cats are bigger than others, but this one is clearly the biggest."
He added: "He has certainly set the pace for BP and other oil company workers. He was probably too busy to notice, but petrol prices went up yesterday for ordinary hard-working motorists."
Sir Ken Jackson, General Secretary of the Amicus union, echoed the sentiment, and said that he was "disappointed" to hear of the pay increase, especially in light of the recent redundancies at BP's Grangemouth site in Scotland in which 1,000 employees lost their jobs.
However, BP have defended their decision to award Lord Browne the rise in salary, with Sir Robin Nicholson, chairman of BP's remuneration committee stressing the importance of retaining Lord Browne as a figurehead for the company.
Writing in BP's annual report, he affirmed: "Rewards for our group executive and for the other executive directors must be competitive with the rewards in similar global companies."
He added that the company had sought independent advice on executive salaries, with seven other BP directors also receiving pay rises in 2001.
BP has been experiencing mixed fortunes during the past six months, after reporting a 46 per cent drop in net profits for the last three months of 2001, in comparison to the same period a year earlier.
However, speaking at the time, Lord Browne stressed that the company was aiming to balance the books during the year ahead through increasing the volumes of oil and gas production, in addition to a programme of cost reduction.
(CL)
The company's annual report revealed that Lord Browne's salary increased to over £3 million during 2001, thanks to a rise in basic pay – from £869,000 to £1.2 million – a performance bonus and expenses, in addition to shares worth over £2.5 million. When his 1.2 million share options are also factored in, the chief executive's total benefits package stands at just over £6 million.
General Secretary of the Transport and General Workers Union, slated the development, saying: "Some fat cats are bigger than others, but this one is clearly the biggest."
He added: "He has certainly set the pace for BP and other oil company workers. He was probably too busy to notice, but petrol prices went up yesterday for ordinary hard-working motorists."
Sir Ken Jackson, General Secretary of the Amicus union, echoed the sentiment, and said that he was "disappointed" to hear of the pay increase, especially in light of the recent redundancies at BP's Grangemouth site in Scotland in which 1,000 employees lost their jobs.
However, BP have defended their decision to award Lord Browne the rise in salary, with Sir Robin Nicholson, chairman of BP's remuneration committee stressing the importance of retaining Lord Browne as a figurehead for the company.
Writing in BP's annual report, he affirmed: "Rewards for our group executive and for the other executive directors must be competitive with the rewards in similar global companies."
He added that the company had sought independent advice on executive salaries, with seven other BP directors also receiving pay rises in 2001.
BP has been experiencing mixed fortunes during the past six months, after reporting a 46 per cent drop in net profits for the last three months of 2001, in comparison to the same period a year earlier.
However, speaking at the time, Lord Browne stressed that the company was aiming to balance the books during the year ahead through increasing the volumes of oil and gas production, in addition to a programme of cost reduction.
(CL)
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