Independent directors of Pemex get paid US$760,000 in 15 months

By Eduardo Buendía

The five independent directors of Petróleos Mexicanos (Pemex) got paid 14.4 million pesos (US$760,000) from November 2014 to January 2016.

Experts say the amount is high and opaque.

According to data obtained by EL UNIVERSAL through requests for information, the directors receive a monthly payment of 41,667 pesos (US$2,199), plus a variable amount that depends on their participation in the Board of Directors. For each board session they get 75,000 pesos (US$3,958), and between 23,000 pesos (US$1,213) and 27,500 pesos (US$1,451) for each committee session.

The highest paid director during the period was Jorge José Borja Navarrete. In total, he participated in 26 meetings of the Board of Directors and 45 committees and received 3.7 million pesos (US$195,274).

Borja Navarrete was corporate director of engineering at Petroleos Mexicanos from January 2007 to January 2010. He also was vicepresident of Empresas ICA and ICA Industrial, and CEO of ICA Fluor Daniel S RL as well as advisor of the infrastructure division of Xignux Group.

Octavio Pastrana Pastrana received 3.42 million pesos (US$180,760). Before joining Pemex had held positions in oil and construction companies. From 1995 to 2007 he was director of British Petroleum in Mexico, Alaska, Bolivia, Chile, Peru and Venezuela. From 2009 to 2013 he was head of the Mexican division of the Spanish company Isolux, that obtained two concessions to operate Saltillo-Monterrey and Perote-Xalapa highways for 45 years.

Alberto Tiburcio Celorio received 3.35 million pesos (US$176,802). He was president of Ernst & Young Mexico from 2001 to 2013, when he retired.

Carlos Elizondo Mayer, a political scientist, was paid 2.97 million pesos (US$157,011). He participated in 23 sessions of the Board of Directors and 25 committee sessions.

In February 2015 Jaime Lomelín Guillén resigned as independent director due to possible conflict of interest, because while he worked for Pemex, he also was board member of Peñoles and director of Técnica Administrativa Bal of Bal Group, owned by businessman Alberto Baillères.

However during the four months Lomelín worked for Pemex he was paid 1.01 million pesos (US$53,656). He participated in 10 meetings of the Board of Directors and four committees.

According to data from PayScale and Careerbliss websites, the four independent directors of Pemex earned as much as Chevron consultants in 2015 and less than ExxonMobil counselors.

Opacity

Aníbal Gutiérrez, a specialist of the National Autonomous University of Mexico (UNAM), says that decisions are delegated to independent directors in order to legitimize the actions undertaken by government companies. However, "with the idea of avoiding temptations that have to do with conflicts of interest, they are generously paid." 

After the energy reform, the government gave its role of "chief administrator" to the boards of directors of companies such as Pemex and the Federal Electricity Commission (CFE) and assumed the role of "owner".

For this purpose two independent directors were named and endorsed by Congress. Their duties are to define the strategic vision of the company, issue investment and hiring policies and the business plan, as well as to monitor and evaluate the performance of the state enterprises.

Given the lack of transparency in the work of independent directors, Ana Lilia Pérez, specialist in Pemex, said: "No one is evaluating the effectiveness of independent directors and they are not subject to public scrutiny through the Federal Law of Administrative Responsibilities of Public Servants" even though Article 8 of this law states that they are "accountable for their activities and should provide all the documentation and information requested."

David Shields, private analyst and consultant in the oil industry in Mexico, says that it is very difficult to assess independent directors because there is no public information on their activities and recommendations.

"In this administration we have very little information about deliberations, proposals and agreements of independent directors. Compared with previous administrations, there is a lot of opacity. These counselors should be accountable to society and inform about their proposals, "he said.

In February Pemex reported that in 2015 it lost 521.6 billion pesos (US$27.52 billion) despite cutting its labor liabilities by 194.9 billion pesos (US$10.28 billion). In 2014 it lost 265.54 billion pesos (US$14.01 billion).