BHP Billiton's chief executive, Andrew Mackenzie, who replaced Marius Kloppers in May, announces 2012 annual results on Tuesday. Photograph: David Gray/Reuters
BHP Billiton has awarded nearly £25m in bonuses to seven of its top executives, days after reporting that its pre-tax profits for 2012 slumped by almost a quarter.
Included in the windfall was Marius Kloppers who received £6.7m despite being replaced as chief executive in May after widespread concern about the way the mining business was being run.
The payouts are part of a so-called long-term incentive plan (LTIP) in which shares are awarded and vested. The £25m relates to only one 12-month period in 2008 so Kloppers, his replacement Andrew Mackenzie, and others could amass further windfalls for 2009 all the way up to 2012. These payments are in addition to annual salaries, cash bonuses and other benefits.
The company said the payments were justified in the light of its strong performance in 2008, a period when commodity prices were high owing in part to demand in fast-growing markets such as China.
But BHP Billiton also pointed out that its remuneration committee of non-executive directors had decided to cut the LTIP payout by 35% in reaction to slump in business which had hit total shareholder returns (TSR) since 2008.
"The committee took into account a range of factors, including the negative TSR over the five year performance period which shareholders have experienced," it said.
"While the committee recognised that the TSR performance was delivered in a difficult business environment, it also felt that more closely aligning the experience of shareholders and executives was important. "
A BHP spokeswoman said the committee had taken the decision unilaterally and denied it was in reaction to pressure from investors.
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