Shell chair faces calls to return £34m paid by BHP after dam catastrophe

Shell’s chairman is facing calls to hand back millions of pounds in bonuses he received when he was chief executive of a FTSE 100 mining giant.

Andrew Mackenzie ran BHP in 2015 when a dam burst in Brazil, killing 19 people. 

The tragedy was the worst mining disaster in the South American country’s history and sparked international condemnation after also ruining people’s livelihoods and homes.

But in a revelation that will cause further anger among victims, it has emerged that Mackenzie received $44.2 million (£34 million) in pay and bonuses from BHP after the incident. 

Payments: Andrew Mackenzie, pictured at BHP in 2018, is facing calls to return money he was paid by the company following a mining disaster 

According to investigative journalism group Finance Uncovered, a break-down of the pay and bonuses shows Mackenzie earned $19 million between 2017 and 2020 when he was chief executive at BHP. 

Some of the awards matured after he left the mining firm and as a result he has received a further $25 million while at Shell.

The High Pay Centre, which campaigns against excessive boardroom rewards, called on BHP to claw back the money.

Luke Hildyard, executive director, said: ‘Chief executives are well paid on the basis of their supposed responsibility, so when major disasters happen on their watch it is appropriate to review historic payments.

‘Clawback provisions attached to chief executive pay awards have been criticised for their lack of effectiveness and it would aid confidence in corporate governance and executive accountability to see more cases where payments to chief executives who were involved in scandals were returned.’

A lawsuit by victims of the disaster began last week in London’s High Court. Lawyers representing thousands of victims are seeking up to £36 billion in damages from BHP. 

The court heard that BHP had been accused of ‘cynically and doggedly trying to avoid’ responsibility for Brazil’s worst environmental disaster. It is the largest group lawsuit in English legal history. Separately, BHP and Vale last week signed a $23 billion settlement with authorities in Brazil.

About 65 million cubic yards of toxic waste was released when the Fundao dam was breached on November 5, 2015. The slip reached the small community of Bento Rodrigues within minutes, killing 19 people including a seven-year-old and destroying bridges, roads, houses, factories and other commercial premises as well as farmland, wildlife and historic churches containing priceless artefacts.

The dam was managed by a Brazilian company called Samarco, in which BHP and Brazilian miner Vale were joint shareholders. BHP and Vale signed a landmark $23 billion compensation deal with the Brazilian authorities on Friday.

Mackenzie boasted that his handling of the disaster ‘is acknowledged as a model for company crisis management’.

After leaving BHP, Mackenzie was awarded a knighthood for his services to business and to relations between the UK and Australia.