Cairn Energy became the latest company to suffer the wrath of UK shareholders, with nearly 70% of investor votes rejecting the Scottish oil firm’s latest executive pay deals.
About 179.6million votes went against the remuneration report yesterday, compared with 88.35million in favour, meaning a 67.03% revolt for the Edinburgh company.
A separate ballot on the re-election of chairman Sir Bill Gammell resulted in an 11% protest vote.
Sir Bill, a former Scotland rugby international, said: “The board and I fully acknowledge the strength of the views expressed by our shareholders in some of their voting today.”
Cairn’s new remuneration committee chairwoman, Jackie Sheppard, said the company had listened to shareholders’ concerns about bosses’ pay during extensive dialogue with investors in recent weeks. She added: “Cairn has learned from the recent consultation and is committed to listening closely to shareholders’ views on governance.”
Earlier this year, Cairn ditched plans to award Sir Bill share options worth £2.5million after pressure from investors.
The firm had wanted to reward him for helping to pull off the £3.5billion-plus sale of most of its Indian operation last year.
Corporate-governance specialist Manifest highlighted wide-ranging concerns recently, including a £1.4million loss-of-office payment to Sir Bill, about Cairn’s remuneration policy. Announcing the results of votes at its AGM yesterday, the company said: “Cairn endeavours to meet the highest corporate-governance standards and is conscious of its responsibility to ensure best practice.”
The latest in a string of investor revolts dubbed the “shareholder spring” came as Cairn unveiled plans to resume drilling offshore Greenland, where it has yet to find commercial quantities of oil. It aims to drill one or more prospects on the Pitu block, which has become the main focus of its exploration, in partnership with Norway’s Statoil, since seismic, 3D and geochemical seabed sampling surveys last summer.
The drilling is targeted for 2014, although it depends on further results from last year’s surveys and approval from Greenland’s government.
Cairn is also part of an industry consortium planning to carry out deep borehole drilling in Baffin Bay later this year.
The work will be done by Shell on behalf of companies including Cairn, ConocoPhillips, Statoil, GfF and Maersk.
Cairn said the project would provide valuable information which could then be extrapolated across the undrilled Baffin basin.