FURIOUS investors are reportedly calling for Royal Dutch Shell bosses to hand back their bonuses amid an escalating row over the oil giant’s pay awards.
Shareholders are also said to be demanding the resignation of Sir Peter Job, the chairman of Shell’s remuneration committee and the figure at the centre of the controversial decision to pay big bonuses despite missing targets.
Shell suffered a humiliating defeat at its annual shareholder meeting last week, when investors voted down its remuneration report in protest at the decision to side-step performance criteria under its long-term incentive plan.
More than 59% of shareholders voted against the report but Shell said it would only take the result into consideration, indicating that there would be no climb-down on its recent bonus payouts.
According to Shell’s annual report, chief executive Jeroen van der Veer, who got a total package worth £8.2million in 2008, was awarded 77,518 shares – worth almost £1.3million at current prices.
Institutional investors are now said to be calling for the head of Sir Peter, who waved through the payments, and for the directors to return their windfalls.
It is widely thought a wider boardroom shake-up is also being urged as fears mount that Shell’s management line-up is becoming increasingly out of touch.
Shell said after last week’s vote that it would “reflect carefully” on the result and had “introduced additional performance measures for future awards”.
The Anglo-Dutch firm maintained that it had used its discretion under previously agreed rules when deciding on the bonuses.
Its incentive award targets are largely based on its performance against peers BP, US firms Chevron and ExxonMobil, and France’s Total.
Despite record £22billion profits last year on soaring oil prices, Shell was ranked fourth out of five.
This should have meant no share awards were made but the remuneration committee decided that the difference between third and fourth place was “marginal” and therefore allowed payouts of 50% of the maximum entitlement.
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