B(umper) P(ay rises)

London - BP chief executive Tony Hayward has netted a 40%-plus pay rise to £4.01 million - the increase comprising a modest 5% salary hike to £1.05m, a 40% increase in his performance bonus to £2.09m and 153% more in shares, worth £852,000. Refining & marketing chief executive Iain Conn’s package, meanwhile, came in 24% higher at £2.39m, while exploration & production chief Andy Inglis had to settle for a 16% increase overall to £2.70m.

The increases were in sharp contrast to BP’s business performance last year, which are given in US currency in the group’s 2009 annual report. This showed profits (EBIT) down 33% to $26.43bn on revenues 50% lower at $239.27bn. The directors, nevertheless, scored highly in terms of ’on-target bonus’ – worth 150% of salary – and performance ’relative to financial and operational metrics’ – valued at up to 225% of salary.

According to Dr D S Julius, chair of the BP remuneration committee, the pay rises reflected the “impressive achievements” of the year and the turnaround of performance over the past three years. Nearly all targets, she said, “were exceeded, some substantially, with particularly strong performance on cost reduction, exploration success, production start-ups and refining performance.”

The ’achievements’, explained Julius, included key safety measures (15% of bonus), staff numbers and survey results to reflect the people priorities (15%) and financial and operational targets to measure performance (70%). BP shareholders, she added, recorded the highest TSR (total shareholder return) of all the oil majors for the year.