Woodside Energy chairman Richard Goyder asks shareholders to look past proxy recommendations
The oil and gas giant will again put its climate change strategy to a vote of shareholders in 2024, after coming perilously close to a rejection last year.
Woodside Energy will put its climate change strategy to a vote of shareholders in 2024, asking shareholders back former federal resources minister Ian Macfarlane’s re-election to its board and to ignore a proxy adviser recommendation they vote against the Woodside pay report.
In a letter to CGI Glass Lewis clients on Monday, Woodside chairman Richard Goyder asked them to ignore the proxy adviser’s recommendations to vote against the company’s pay report and Mr Macfarlane’s re-election to its board as a protest against Woodside’s ““continued lack of appropriate response” to a shareholder pushback on its 2021 climate change report.
“Woodside has engaged extensively with shareholders and proxy advisers on our climate strategy and remuneration matters over the past 12 months – and continues to do so,” he said.
Glass Lewis made the recommendations last week, criticising Woodside for failing to justify a pay bump handed to chief executive Meg O’Neill in the wake of Woodside’s acquisition of BHP’s oil and gas assets, as well as the company’s response to the near-rejection of its 2021 climate report by shareholders at last year’s annual meeting.
The advisory vote 2021 climate report passed only narrowly, after being backed by only 51 per cent of shareholders.
The Woodside board reviewed Ms O’Neill’s salary package in mid-2022, after the close of blockbuster merger of its oil and gas assets with those of BHP, bumping her fixed pay package up $200,000 a year to $2.4m, and boosting her total possible incentive rewards to 420 per cent of Ms O’Neill’s fixed pay packet – from 300 per cent when she was appointed to the company’s top job in 2021.
In its review of the motions to be put to Woodside’s next annual meeting, on April 28, Glass Lewis said that Ms O’Neill could now earn a total of $12.48m in fixed and discretionary payments – 40 per cent above those of Fortescue Metals Group, which has a similar market capitalisation as Woodside.
Its recommendation that shareholders vote against Mr Macfarlane’s return to the Woodside board partially backed a campaign run by climate activist group Australasian Centre for Corporate Responsibility (ACCR) to unseat Woodside directors to hold the board its “repeated failure” to present a credible strategy to address climate change.
Glass Lewis picked Mr Macfarlane as its recommended target for any protest vote as the former federal resources minister is the longest serving Woodside director.
In its response, which will be distributed to Glass Lewis clients, Woodside said it did not believe the Glass Lewis recommendations were a fair reflection of the company’s efforts over the last year.
Woodside said it had conducted “extensive” consultation with shareholders and their advisers in the lead up to the April 28 meeting, including more than 60 meetings involving chairman Richard Goyder or other senior executives responsible for its strategy and response to climate change.
“We have also improved and enhanced Woodside’s financial disclosures on climate impacts through additional notes to the financial statements and basis of preparation section in the 2022 Annual Report. Woodside has considered the impact of the climate and the energy transition in assessing the carrying value of its assets and liabilities,” Mr Goyder’s letter said.
“In recognition of the keen interest shown by shareholders regarding Woodside’s climate strategy, the board intends to put its climate reporting to a non-binding, advisory vote of shareholders at its 2024 Annual General Meeting. Subsequent shareholder votes will be held at three-year intervals, except in exceptional circumstances.”
Woodside also defended its remuneration report, telling Glass Lewis clients it had a good track record of reflecting the company’s performance in its pay and bonuses to senior executives, having cut bonus payments in 2020 after a poor year for the company in financial terms.
The company said its revised incentive package for Ms O’Neill was a reflection that the previous package was beneath the levels offered by local and international competitors such as Santos, ConocoPhillips, Equinor and Hess Corp.
“The board strongly believes that the MD/CEO’s total remuneration package is not excessive and brings the total remuneration to a competitive position in the selected peer group,” Mr Goyder said.
Woodside shares closed up 1c to $34.79 on Monday.
To join the conversation, please log in. Don't have an account? Register
Join the conversation, you are commenting as Logout