BP: Tony Hayward may be the world's most unpopular businessman. But the mistakes that are now ending his career at the UK oil major are those of a hapless man, not a villain. So it would be both vindictive and unjustified to pay him off with less than his contractual entitlement - however much of a stink that may cause in the United States. To the extent that Hayward's mishandling of the disaster exacerbated the fall in BP's shares by souring relations with Washington, this may be alleviated by his exit.
The vast bulk of Hayward's entitlement is his pension pot, which had a transfer value of 10.9 million pounds at the end of last year. This has been accrued over 28 years of service prior to the explosion on BP's well in Gulf of Mexico in April. The other primary component would be one year’s salary, or £1.05 million taking Hayward’s pay last year. Nor is there any good reason to strip Hayward of the awards already granted under a three-year share-based plan, which will presently be under water in any case.
Arguably Hayward could also be entitled to any portion of his performance bonus paid for operational targets not affected by the oil spill, such as refining and marketing income. That might be worth another £700,000 or so. But if Hayward wants to show that he has learnt something from this fiasco and to rebuild some of his reputation, he would be well advised to turn down any performance bonus.
Finally, there is no case for giving Hayward a discretionary top-up like that received by Fred Goodwin upon stepping down as CEO of Royal Bank of Scotland after leading it to its near-collapse. Fortunately, such a payment does not seem to be part of Hayward's negotiations.
There may be outrage on Capitol Hill at Hayward receiving an eight-figure package. But the senators have got Hayward's head and should leave it at that.