Centrica: FTSE 100 British Gas owner suffers huge backlash over CEO pay rise plans
Centrica, the FTSE 100 parent company of British Gas, has suffered a huge backlash to plans to hand its chief executive a hefty pay rise.
City PM reported in March that the CEO took home £4.3m for Centrica’s latest financial period, down from the £8.2m he received in the prior year.
Chris O’Shea, who has been CEO of the FTSE 100 company since 2020, had previously received £4.49m in 2022.
His latest pay packet included a base salary of £845,000, £1.4m from the annual incentive plan and £2m from the long-term incentive plan.
Last year’s package consisted of £810,000 in salary, a £1.4m annual bonus and £5.9m in long-term bonus, and some pension and benefits.
However, the owner of British Gas added that O’Shea’s “remuneration is no longer sufficiently aligned with our peers, and his performance and experience warrants positioning his pay between the median and upper quartile of the FTSE 100”.
As a result, the group confirmed it will increase the CEO’s salary from £855,000 to £1.1m from 1 April.
Centrica also confirmed that O’Shea’s maximum RSP (Restricted Share Plan) award would be increased from 150 per cent of salary to 200 per cent.
At Centrica’s annual general meeting today, almost 40 per cent of votes were cast against the remuneration report.
British Gas owner to ‘engage with shareholders’ following vote
In a statement issued to the London Stock Exchange, the owner of British Gas said: “The board appreciates the support shown by shareholders for the resolutions at today’s AGM.
“We acknowledge the outcome of the vote on resolution two relating to the directors remuneration report.
“While we welcome the backing of the majority of our shareholders for that resolution following extensive engagement on remuneration, we will continue to engage with shareholders in constructive and open dialogue.
“The company will provide an update to shareholders within six months of today’s meeting.”
Centrica’s annual report came after the owner of British Gas beat earnings estimates for its latest financial year and hiked its dividend.
The group posted earnings before interest, taxation, depreciation and amortisation (EBITDA) of £2.3bn for the 12 months ended 31 December.
While this was down from last year’s £3.5bn, it was well ahead of analyst expectations of £1.6bn.