Shell’s shareholders scored a victory yesterday after last year’s revolt on remuneration forced the oil titan to freeze pay and curb bonuses.
In a letter to shareholders, Hans Wijers, new head of the group’s remuneration committee, said salaries have been frozen from July 2009 to January 2011 in an effort to increase the “alignment between executive and shareholder interests” and demonstrate “appropriate restraint in the current economic environment.”
The Anglo-Dutch group suffered a blow last year after a hefty 60 per cent of shareholders voted against its pay package at its May general meeting, after it was revealed that senior management had received bonuses despite missing their profit targets.
The group failed to make the top three for shareholders returns within the oil and gas sector, but Sir Peter Job – head of the remuneration committee at the time – spurned investors with his decision to award executives a discretionary sum for their work.
However, tough times in the industry last year played a large part in stopping a repeat this year. Lower gas prices and falling demand last year wreaked havoc with Shell’s profits, which slumped 69 per cent to $9.8bn.
Chief executive Peter Voser and chief financial officer Simon Henry receive about 20 per cent less in salary than their predecessors.