Kudos to Murphy Oil and Marathon Oil for adjusting their executive compensation frameworks, in part, to better align with their environmental targets. Their willingness alone to change the paradigm is a rarity in the oil and gas industry and deserving of credit.
On Feb. 8, Murphy Oil announced it would be adjusting performance metrics under its Annual Incentive Plan (AIP) to emphasize not only its cash flow but climate goals as well by adding a greenhouse gas (GHG) emissions reduction metric, “for which aggressive goals must be achieved to earn a payout,” according to the company. This metric accompanies the company’s safety and spill rate metrics in the environmental, social, and governance (ESG) component of its AIP, Murphy Oil said.
