BHP Billiton cuts bonuses, CEO forgoes $1.5 million in shares

BHP cut bonus payouts as total returns to shareholders were negative rather than positive over the five years to June

Reuters
First Published23 Aug 2013, 12:05 PM IST
BHP cut bonus payouts largely because TSR were negative rather than positive over the five years to June 2013, although at negative 9.4%, BHP&#8217;s return looked far better than the negative 44% return suffered by its peers. Photo: AFP <br />
BHP cut bonus payouts largely because TSR were negative rather than positive over the five years to June 2013, although at negative 9.4%, BHP&#8217;s return looked far better than the negative 44% return suffered by its peers. Photo: AFP (AFP )

Melbourne: BHP Billiton Ltd has cut bonus payouts to its top executives, as total returns to shareholders fell over five years, even though the top global miner beat its target for outperforming its peers over that period.

add_main_imageNew chief executive Andrew Mackenzie, who was first poached from rival Rio Tinto Plc in 2008, also gave up shares worth £941,000 ($1.47 million) at Thursday’s close that were due to him from his sign-on bonus.

In total, Mackenzie was awarded shares worth £4.6 million, after the company decided to pay out only 65% of long-term share bonuses. That left him £3.9 million short of the total he could have earned.NextMAds

BHP cut bonus payouts largely because total returns to shareholders (TSR) were negative rather than positive over the five years to June 2013, although at negative 9.4%, BHP’s return looked far better than the negative 44% return suffered by its peers.

That was above the company’s target to outperform peers by at least 31%.

“While the Committee recognised that the TSR performance was delivered in a difficult business environment, it also felt that more closely aligning the experience of shareholders and executives was important,” the company said in a statement to the Australian stock exchange.

It also took into account factors such as fatality trends and capital project performance.

Former CEO Marius Kloppers was awarded shares worth A$11.5 million ($10.4 million) at Thursday’s close, which was A$6.2 million short of what he could have earned.

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First Published:23 Aug 2013, 12:05 PM IST
HomecompaniesnewsBHP Billiton cuts bonuses, CEO forgoes $1.5 million in shares

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