LONDON—BP PLC’s chief executive Bob Dudley received a 20% bump in his total compensation package last year, bringing it to $ 19.6 million despite an ongoing slump in oil prices that has battered the energy giant’s earnings.
Mr. Dudley got a boost in 2015 from a $ 1.4 million cash bonus—up from about $ 1 million in 2014—and a doubling of his retirement savings from 2014 to $ 6.5 million, the company said in its annual report released on Friday.
Overall, the company continued a freeze on its executives’ salaries and said they would remain static in 2016 given the low oil prices. Mr. Dudley’s actual salary of about $ 1.9 million was little changed from 2014.
BP is the first of the so-called oil majors to release details of executive pay in 2015—a year defined by a near 50% drop in oil prices that hammered the entire sector.
Mr. Dudley’s compensation increase reflects a year in which BP lost $ 5.2 billion. The company announced plans this year to cut 7,000 jobs by the end of 2017 and has slashed spending to help managed the slump.
Mr. Dudley should be accustomed to operating under such pressure. The 60-year-old executive’s time at the head of the company has been defined by crises—BP’s disastrous 2010 blowout in the Gulf of Mexico followed by one of the biggest oil slumps in the markets history.
Though sizable, Mr. Dudley’s pay package is still much smaller when compared with the heads of America’s largest oil companies. In 2014, ExxonMobil Corp. CEO Rex Tillerson received compensation valued at $ 33 million and Chevron Corp.’s head John Watson got a $ 26 million package.
Such massive payouts have in the past led to tensions with investors. For instance, last year, shareholder advisory group Glass Lewis recommended investors vote down Mr. Dudley’s proposed pay for 2014, though ultimately the package received approval at the company’s annual meeting.
BP said its compensation committee focused on Mr. Dudley’s success in bringing down costs and spending, a strong safety record for the year and operating cash flow and underlying profits that beat internal targets. Mr. Dudley was one of the first oil executives to warn that the era of low prices would last longer than many expected.
“The company’s decision in late 2014 to plan for a ‘lower for longer’ oil price meant that the leadership acted early and decisively to respond to the low oil price environment,” BP said in the annual report, filed with the Securities and Exchange Commission on Friday. “Overall, management delivered very well in terms of what they could control.”
BP said Mr. Dudley’s pay package isn’t as large as it looks because U.K. reporting requirements have inflated the increase in Mr. Dudley’s pension. The company said their top executive’s pension savings increased by $ 309,000 last year. That number has been multiplied by 20 in the report to comply with U.K. regulations, but the company said a U.S. plan like Mr. Dudley’s would more typically have an annuity factor of around 14.
Excluding pension and retirement savings the executives’ pay slipped to $ 13.1 million in 2015, compared with $ 13.4 million a year earlier. He received $ 9.7 million from a deferred bonus and performance-linked shares, down from $ 10.4 million in 2014.
Along with his salary and cash bonus, he received $ 119,000 for a car, security and other benefits.
Write to Sarah Kent at [email protected]