BP 2009 Annual Report Download - page 94

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BP Annual Report and Accounts 2009
Directors’ remuneration report
Fee structure
The table below shows the fee structure for non-executive directors on
1 January 2010:
£ thousand
Fee level
Chairmana750
Senior independent directorb120
Board member 75
Audit committee and SEEAC chairmanship feesc30
Remuneration committee chairmanship feec20
Committee membership feed5
Transatlantic attendance allowance 5
aThe chairman remains ineligible for committee chairmanship and membership fees or transatlantic
attendance allowance.
bThe senior independent director is eligible for committee chairmanship fees and transatlantic
attendance allowance plus any committee membership fees.
cCommittee chairmen do not receive an additional membership fee for the committee they chair.
dFor members of the SEEAC, audit and remuneration committees.
Remuneration of non-executive directors in 2009a
£ thousand
2008 2009
P D Sutherland 600 600
A Burgmans 90 93
Sir William Castell 108 115
C B Carroll 93 90
G Davidb100 118
E B Davis, Jr 105 105
D J Flint 90 85
Dr D S Julius 110 105
Sir Ian Prosser 170 165
C-H Svanbergcn/a 30
Directors leaving the board in 2009
Sir Tom McKillop 95 33
aThis information has been subject to audit.
bAlso received £4,166 for serving as a member of BP’s technology advisory committee.
cAppointed on 1 September 2009.
While fees were held at 2008 levels, in 2009 actual fees paid to non-
executive directors were affected by changes in committee membership
and the number of transatlantic meetings to which an attendance
allowance was paid.
No share or share option awards were made to any non-executive
director in respect of service to the board during 2009.
Non-executive directors have letters of appointment which
recognize that, subject to the Articles of Association, their service is
at the discretion of shareholders. All directors stand for re-election at
each AGM.
Superannuation gratuities
Until 2002, BP maintained a long-standing practice whereby non-
executive directors who retired from the board after at least six years’
service were eligible for consideration for a superannuation gratuity. The
board was, and continues to be, authorized to make such payments
under the company’s Articles of Association. In 2002, the board revised
its policy so that non-executive directors appointed to the board after
1 July 2002 would not be eligible for a superannuation gratuity, and that
directors in service at that date would remain eligible but service past
1 July 2002 would not be taken into account by the board in considering
the amount of the superannuation gratuity.
The amount of the superannuation gratuity is calculated according to
the following:
• Service on the board is taken up to 1 July 2002.
• Payment is calculated as 10% of the total remuneration received in
either the year to 1 July 2002 or calendar year 2001 (whichever is the
greater) multiplied by the number of years a non-executive director
served on the board until 1 July 2002.
• There is a limit on the payment equivalent to a maximum of 10 years’
service.
Peter Sutherland, who retired on 31 December 2009, is entitled to a
superannuation gratuity of £280,000 in line with the policy arrangements
agreed in 2002 and outlined above. Mr Sutherland has asked that the full
balance of the gratuity be donated to an educational foundation.
Non-executive directors of Amoco Corporation
Non-executive directors who were formerly non-executive directors of
Amoco Corporation have residual entitlements under the Amoco Non-
Employee Directors’ Restricted Stock Plan. Directors were allocated
restricted stock in remuneration for their service on the board of Amoco
Corporation prior to its merger with BP in 1998. On merger, interests in
Amoco shares in the plan were converted into interests in BP ADSs. The
restricted stock will vest on the retirement of the non-executive director
at the age of 70 (or earlier at the discretion of the board). Since the
merger, no further entitlements have accrued to any director under the
plan. The residual interests, as interests in a long-term incentive scheme,
are set out in the table below:
Interest in BP ADSs Date on
at 1 Jan 2009 and which director
31 Dec 2009areaches age 70b
E B Davis, Jr 4,490 5 Aug 2014
aNo awards were granted and no awards lapsed during the year. The awards were granted over
Amoco stock prior to the merger but their notional weighted average market value at the date of
grant (applying the subsequent merger ratio of 0.66167 of a BP ADS for every Amoco share) was
$27.87 per BP ADS.
bFor the purposes of the regulations, the date on which the director retires from the board at or after
the age of 70 is the end of the qualifying period. If the director retires prior to this date, the board
may waive the restrictions.
Past directors
Mr Miles (who was a non-executive director of BP until April 2006)
was appointed as a director and non-executive chairman of BP Pension
Trustees Limited in October 2006. During 2009, he received £150,000
for this role.
Dr Walter Massey (who retired as a non-executive director of BP
in April 2008) was appointed to the BP America External Advisory Council
in April 2008 for a period of two years. During 2009, he received
US$93,750 for this role.
This directors’ remuneration report was approved by the board and
signed on its behalf by David J Jackson, company secretary, on
26 February 2010.