BG chief joins £1m pay league

The chief executive of BG, the oil and gas exploration group, joined the £1m-a-year-club last year thanks to a bumper annual bonus payment which exceeded his base salary.

Frank Chapman earned £1.12m in 2002 – a 48 per cent increase on the previous year – even though BG's profits fell 12 per cent. Mr Chapman was also granted a "notional" 611,286 shares under the company's long-term incentive scheme worth a total of £1.57m at last night's closing price. In addition to his salary, Mr Chapman received a £756,000 injection into his pension pot making it worth £2.667m.

Mr Chapman's base salary was £537,998 but this was more than doubled by a £550,000 annual bonus. Another BG director – its deputy chief executive and general counsel, William Friedrich – also earned more than £1m. He took home £1.036m, including an annual bonus of £461,120.

The pay of BG's non-executive chairman, Sir Richard Giordano, rose by 9 per cent to £490,373. Sir Richard, who is on a one-year rolling contract, has an agreement whereby his salary rises by at least the headline rate of inflation each April, although he receives no annual bonus and does not take part in any long-term incentive schemes.