UPDATE 2-Occidental CEO to step down next May; exec pay cut

* COO to take over from Irani, who will be exec chairman

* Under investor pressure, to bring pay in line with peers

* Names Wells Fargo CFO to board; two members to retire

* CalSTRS and Relational Investors endorse actions
(Rewrites with comments from board member; adds byline,
dateline; updates shares)

By Braden Reddall

SAN FRANCISCO, Oct 14 (BestGrowthStock) – Occidental Petroleum Corp
(OXY.N: ), facing shareholder pressure over management pay and
succession plans, is bringing on a new CEO next May and cutting
executive salaries to bring them more in line with peers.

The pay of Ray Irani, the chief executive for two decades,
and other top executives will be “substantially” cut and, in a
much-anticipated move, Chief Operating Officer Stephen Chazen,
64, will take over from Irani, Occidental said on Thursday.

Irani, who is 75 and was born in Lebanon, will stay on as
executive chairman until the end of 2014. His ties to the
Middle East will be valuable as Occidental expands production
in Iraq in the next half decade. [ID:nN19243152]

“We have had a succession plan that we have worked on for
some time and this is just one more step along that pathway,
with more steps to follow,” Spencer Abraham, the Oxy board
member who chairs the compensation committee, told Reuters.

Media attention has long focused on the compensation for
Irani, which grew 40 percent in 2009 to $31.4 million, and
Abraham said an advisory shareholder vote in May that went
against the pay structure was the main catalyst for change.

“We sort of anticipated that that would be either very
close one way or the other, or that very likely that would be a
negative vote,” Abraham said. “There were other issues raised
by some of the investors, but maybe that say-on-pay vote was
the point that it took on a little bit more activity.”

The company said that, under the new pay program,
compensation for the chairman and CEO was expected to be lower
than at one or more peer companies, at all performance levels.

The moves on pay and succession won the endorsement of two
funds that own more than 1 percent of Occidental’s shares and
had pushed for changes.

The California State Teachers’ Retirement System and
Relational Investors LLC had said in August they aimed to take
at least four of the 13 board seats at the annual general
meeting next year because of their concerns.

Occidental also said two board members, John Chalsty and
Irvin Maloney, would not stand for reelection. The company
named Wells Fargo & Co’s (WFC.N: ) CFO, Howard Atkins, to its
board and said it would name a second nominee later.

The company’s shares rose 0.3 percent to $84.59.
(Reporting by Braden Reddall in San Francisco and Adveith Nair
and Anand Basu in Bangalore; editing by Savio D’Souza and Andre
Grenon)

UPDATE 2-Occidental CEO to step down next May; exec pay cut