BHP freezes executive salaries as CEO Henry takes $6.1 million for first six months

FILE PHOTO: BHP Chief Executive Officer Mike Henry films results announcement in this August 14, 2020 handout picture. Courtesy of BHP/Handout via REUTERS

MELBOURNE (Reuters) - Global miner BHP Group BHP.AX said in its annual report on Tuesday that it froze salaries of key leadership personnel for the coming financial year, while Chief Executive Mike Henry received $6.1 million (4.75 million pounds) in the first six months on the job.

Henry, who became chief executive on Jan. 1 this year, was set a salary of $1.87 million a year, including a base salary of $1.7 million and a 10% pension contribution, but not including short- and long-term incentives that make up the majority of his remuneration.

The outcome reflected “an appropriate alignment between pay and performance during the year and is also fair in terms of the global context in which decisions have been made,” Chair of the remuneration committee, Susan Kilsby, said.

The coronavirus-induced pressure at companies globally is likely to feed through into lower executive salaries more broadly. At global mining companies, costs have also surged as miners have spent on safety and quarantine measures to curb the virus impact on their workforce and nearby communities.

BHP also announced that there would be no hike to salaries or total remuneration packages for the CEO or other key management personnel.

Henry’s 2021 total target remuneration is unchanged at $7.5 million, BHP said, 12% lower than that of previous Chief Executive Andrew Mackenzie. The former CEO took home $2.4 million for the first half of the 2020 financial year and another $5.3 million as his 2015 long-term incentive.

Chairman Ken MacKenzie’s fee remained at $880,000, with the level being constant for a fourth year. Base fee levels for other non-executive directors will also remain unchanged at $160,000 a year.

Reporting by Melanie Burton and Rashmi Ashok in Benguluru, Editing by Sherry Jacob-Phillips