Shell latest oil major to be embroiled in row over exec pay

Jessica Morris
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Ben van Beurden's pay is due to fall eight per cent to €5.1bn (£4m) (Source: Getty)

Royal Dutch Shell became the latest oil major to become embroiled in a row over executive pay, after BP shareholders rejected chief executive Bob Dudley's pay deal.

Two investor advisory firms have recommended Shell shareholders oppose chief executive Ben van Beurden's 2015 remuneration. While his pay is due to fall eight per cent to €5.1bn (£4m) compared to a year ago, it comes against a sharp drop in revenue on lower oil prices.

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Proxy adviser Glass Lewis said in a report it remains "concerned by the disconnect between bonus payouts and financial performance, and the bonus scheme structure more generally".

In a separate report, adviser PIRC said: "The ratio of chief executive pay compared to average employee pay is 37:1, which is unacceptable."

A Shell spokesman said its executive compensation "reflects delivery of our strategy, measured by both short-term and long-term targets. There is a clear alignment between the company's performance and our compensation policies".

Shell shareholders will have their say on the firm's remuneration packages in a vote at its annual general meeting at The Hague next week.

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BP shareholders gave boss Dudley a bloody nose earlier this year when a majority voted against his proposed $19.6m (£13.8m) remuneration package. While the move was unprecedented, it was non-binding.

Oil majors' shareholders have become increasingly disgruntled as low oil prices have eaten into the value of their investments. Oil prices fell to a multi-year low of below $28 per barrel in January, however they've since recovered to nearly $50.

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