In an interview with the BBC, Chris O’Shea, the CEO of British Gas owner Centrica, expressed his acknowledgement that his pay package of £4.5 million for the previous year is “impossible to justify.”

O’Shea, who discussed various issues on BBC Breakfast, including concerns about fixed standing charges and the rising costs of gas and electricity, admitted that with customers grappling with overdue bills amounting to nearly £3 billion, a salary of such magnitude cannot be justified.

While emphasising that he does not determine his own pay, O’Shea recognised the disparity between his earnings and the financial challenges faced by consumers. “You can’t justify a salary of that size. It’s a huge amount of money to anyone looking at it,” he remarked during the interview.

Despite acknowledging the financial struggles of many customers, O’Shea highlighted that the interviewers, like himself, earned well above the average wage and did not set their own salaries.

He drew attention to the broader issue of executive compensation and the difficulties in justifying such high figures in the context of economic challenges faced by the public.

O’Shea turned down a £1m bonus

In a notable move, O’Shea disclosed that he had turned down a £1.1 million bonus in 2021 due to the “hardships” experienced by customers. This decision followed the refusal of bonuses in 2020 and 2019 due to the impact of the pandemic. The CEO defended these actions during the interview, stating that his pay was determined by the remuneration committee, and he had made personal choices to forgo additional compensation.

The revelation of O’Shea’s bonuses in March sparked criticism, especially in light of an investigation by The Times, which exposed debt agents associated with British Gas breaking into the homes of vulnerable individuals to install prepayment meters. Consequently, a temporary sector-wide ban was imposed on such installations, with British Gas still unable to resume under stricter regulations.

The debate surrounding executive pay

Despite the controversies surrounding executive compensation, Centrica reported profits of £3.3 billion for 2022, attributing the boost to increased oil and gas prices following Russia’s invasion of Ukraine. O’Shea noted that the retail arm of British Gas contributed £150 million to this figure.

The interview sheds light on the ongoing debate surrounding executive pay, particularly in industries that play a critical role in the daily lives of consumers. As discussions on the cost of living continue, O’Shea’s candid admission brings attention to the need for transparency and accountability in determining executive salaries.

 

 

 

 

Amelia Brand
Amelia Brand

Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.