Two large pension funds were set last night to file suit in a state court in Alaska to block a retirement package for the outgoing chief executive of the oil giant BP, Lord Browne, which they estimate at about $140m (£72m), calling it over-generous and unjustified.
It is the latest aggressive move by the funds against BP. Last October, the same funds, the US union group Unite Here and the London Pensions Fund Authority, sued the company, accusing it of lax environmental controls at its operations and failure properly to protect the safety of its workers.
This new suit, which the funds were planning to file with the Alaska court yesterday, demands that any compensation package for Mr Browne, who announced plans last month to step aside at the end of July, be put in a court-managed trust pending resolution of the allegations.
"Browne is now, it appears, being pushed out of the company but taking with him upward of God knows how many millions and millions of dollars of severance and pension payments," said William Lerach, a class-action lawyer who represents the pension funds. "We don't think he should be able to walk away with that kind of money."
Once one of the world's most respected chief executives, Lord Browne has seen his legacy tarnished as BP, the world's fourth largest oil company, has struggled with damage to its image after several accidents, including oil spills in Alaska and an explosion at a Texas facility which killed 15 workers. American industry regulations have also publicly suggested that BP had put profit before workers.
Investors are increasingly questioning the size of compensation packages for corporate leaders, such as the sums promised to the ex-Home Depot chief executive Robert Nardelli and the former Pfizer chief executive Hank McKinnell, both promised pay-offs of about $200m.Reuse content