Occidental Petroleum Corp. (OXY) Chief Executive Officer Steve Chazen will keep his post through the end of 2014 as the company announced changes to its compensation plan and restrictions on who may serve as chairman.
The company will cut stock grants to its board and reduce the “discretionary portion” of its CEO’s bonus, Los Angeles- based Occidental said in a statement today. Former CEOs will no longer be eligible to serve as chairmen.
Shareholders including First Pacific Advisors LLC and the California State Teachers’ Retirement System had advocated for Chazen, 66, to remain after the board announced plans to find a successor in February. Investors have questioned the role current Chairman Ray Irani, 78, who served as CEO until 2011, played in the decision to replace Chazen.
“Chazen never got a chance to run the company in the short time that he was CEO,” said Tim Beranek, a money manager at Cambiar Investors LLC, which oversees about $8 billion including about 1.5 million Occidental shares. “Irani was still always in charge.”
Irani reiterated April 8 his intention to retire at the end of 2014.
Future chairmen must be independent and CEOs will have a mandatory retirement age of 68, the company said in the statement today.
The announcement was made before regular trading in New York. Occidental increased 1.3 percent to $86.66 April 26 in New York.
“Today’s announcement is consistent with my personal plans,” Chazen said in today’s statement. “I support the board and its efforts to move forward on succession and corporate governance issues.”
To contact the editor responsible for this story: Susan Warren at firstname.lastname@example.org