Occidental Petroleum says CEO to remain until 2014
(Reuters) - Occidental Petroleum Corp (OXY.N), the fourth-largest U.S. oil company, said Chief Executive Steve Chazen would continue in his role through 2014 with the full support of the board, reducing uncertainty surrounding its CEO succession plans.
The Wall Street Journal said in March there was pressure from Chairman and former CEO Ray Irani for Chazen to leave the post immediately, but the company had denied any fight at the top.
On Monday, Occidental announced cuts in director and CEO compensation among a range of governance measures that also included an upper age limit of 68 for CEOs to retire. Chazen, 66, said the measures were consistent with his personal plans.
Occidental also said former CEOs would not be eligible to serve on the board "going forward". It did not specify whether this rule would apply to 78-year-old Irani, who has said that he plans to retire as chairman at the end of 2014.
Occidental said in mid-February it was seeking a replacement for Chazen, who joined the company in 1994 and took over as CEO in mid-2011.
Morningstar analyst Allen Good called the latest move a positive for the stock as it cleared a lot of uncertainty around the CEO's tenure.
"Giving him (Chazen) more time to execute on his plans certainly should reassure investors at this point," Good said.
Occidental's shares rose 1 percent to $87.68 in morning trading on the New York Stock Exchange.
Analysts at Simmons & Co said the announcement should help resolve the "overhang" on Occidental's shares.
Occidental also said the discretionary portion of the CEO's bonus would be reduced to "no more than 20 percent" from 40 percent, and that the company's financial performance would be used to evaluate his performance.
The annual common stock grant to non-employee directors would be reduced by at least 20 percent immediately and the director-compensation program would be reviewed this year, the company added.
Occidental said Chazen himself had proposed that he would not be eligible for any bonus or earnings-based pay during his remaining tenure.
(Reporting by Thyagaraju Adinarayan and Garima Goel in Bangalore; Editing by Sreejiraj Eluvangal)
- Malaysia Airlines plane missing at sea off Vietnam, presumed crashed |
- China draws 'red line' on North Korea, says won't allow war on peninsula
- Malaysian plane crashed off Vietnam coast: state media
- No signal picked up from missing Malaysia Airlines plane-Vietnam official