They're lining up to put the boot into BP's (BP.) remuneration committee as the controversy over chief executive Bob Dudley's proposed 20 per cent pay-package hike intensifies. Aberdeen Asset Management (AAM) has added its weight to proceedings ahead of a key shareholder vote at the annual general meeting. The FTSE 250 investment manager joins the likes of ShareSoc, Glass Lewis and Royal London Asset Management (RLAM) among the dissenters.
ShareSoc, a UK shareholder advisory group, has recommended that its members vote against the oil major's remuneration report, while Ashley Hamilton Claxton, corporate governance manager at RLAM, labelled the chief executive's settlement "both unreasonable and insensitive"; the latter charge doubtless linked to BP's decision to cut around 7,000 jobs by the end of next year.
The redundancies were explicable in terms of the prolonged slump in crude oil prices, but shareholders have taken umbrage at the magnitude of Mr Dudley's compensation; essentially whether it's commensurate with a record annual loss of $5.2bn (£3.6bn) in 2015. Naturally, BP has argued that management has met nearly all the performance criteria set out under the remuneration scheme, although ShareSoc has dismissed the determinations as "excessively complex".
A cynic might say that's the entire point. And the same cynic might also point out that BP may be in a rush to push through overly generous pay deals ahead of next year, when the shareholder vote on remuneration policies will be binding, following on from changes to corporate legislation in 2013.
BP's AGM vote will be conducted today, Thursday 14 April, but given the prevalence of private investors on the group's share register, it's likely that Bob Dudley & co. will have received a fairly prickly reception on the back of the ShareSoc stance. At least they'll be able to lick their wounds at the Institute of Directors with peers from the likes of Persimmon (PSN), Reckitt Benckiser (RB.) and AstraZeneca (AZN), all of which are facing the opprobrium of shareholders over excessive pay deals.
