Business Irish

Saturday 7 December 2019

Tullow's Heavey is latest to feel 'shareholder spring' heat

Peter Flanagan

TULLOW Oil became the latest company to be hit with the so-called "shareholder spring" yesterday after more than one-fifth of investors opposed the directors' pay packets.

At its annual general meeting in London, shareholders owning 20.9pc of the shares voted against the directors' remuneration report, while another 6.6pc of votes were withheld.

Tullow chief executive Aidan Heavey is known as one of the highest paid Irish chief executives.

Last year he was awarded a total pay packet of £2.3m (€2.8m), up 41pc year on year.

The rest of the executive directors also had their total compensation increased greatly, with the aggregate compensation rising 41pc.

The company also bumped up pay for non-executive directors in response to fears that compensation for non-executives had fallen below acceptable levels. In the company's annual report for 2011, chairman Simon Thompson said executive remuneration had been "the focus of considerable comment over the past year".

"At the beginning of 2011, Tullow granted 20pc salary increases to our executive directors, to reflect the outstanding performance and growth of the company and the fact that increases in the previous two years were limited to inflation adjustments.

"In 2012, in common with all other members of staff, the executive directors will receive salary increases in line with inflation," he wrote.

The vote on pay was the only resolution that was rejected by shareholders in substantial numbers. Last year, just over 7pc of investors went against the company on executive pay.

The company declined to comment on the shareholder revolt, but pointed to strong increases in production and profits during 2011.

This year's AGM season has been marked by a series of revolts by shareholders protesting against executive pay.

Aviva boss Andrew Moss resigned after investors rejected his compensation, while there have been significant votes against the pay of a number of CEOs -- particularly in the UK.

In an interim management statement released alongside the AGM, Tullow said it had an "excellent" first half of the year.

Speaking to reporters after the meeting, Mr Heavey said the company has talked to potential buyers of its Asian assets, while its oil discovery in Kenya, the first such find in the country, could potentially be bigger than its Ugandan operation with possibly 2.5 billion barrels of oil on site.

Tullow closed the day in London flat at 1.391 pence.

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