Our views

RLAM to oppose Tullow Oil Chairman appointment

Ashley Hamilton Claxton, Corporate Governance Manager

25 April 2017

We are opposing the election of Aidan Heavey, the company’s founder and current CEO, as Chairman of Tullow Oil. This is a clear violation of an important corporate governance principle, designed to protect shareholders and ensure effective independent oversight of  the company’s management. In addition, we do not support the Remuneration Committee’s decision to continue to pay Mr Heavey his CEO salary, benefits and incentive payments for his first six months serving as non-executive Chairman.

We have also voted against the remuneration report, remuneration policy and the election of the Chairman of the Remuneration Committee at Tullow, over our ongoing concerns that pay is too focused on the short term. The company has set a performance target to return to the FTSE 100, which is an inappropriate condition, as executives should be focused on running an effective business first and foremost. We are also uncomfortable with the significant amount of discretion available to the Remuneration Committee under the new policy.

The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not get back the amount originally invested. The views expressed are the author’s own and do not constitute investment advice.