Daily Telegraph: Investor pressure gets some answers from Shell
By Christopher Hope, Business Correspondent (Filed: 17/06/2004)
Shell, the embattled oil and gas giant, has buckled under pressure from shareholders and will release some operational information about the review of its corporate structure today or tomorrow.
Shell's dual structure - it has two boards and is 40pc owned by Shell Transport in the UK and 60pc owned by Royal Dutch in the Netherlands - was blamed for its admission in January that it had overstated "proven" oil and gas reserves by more than 20pc.
An update on the review is due to be announced by Shell's chairman of its committee of managing directors Jeroen van der Veer at the company's annual meeting on Monday week.
Shareholders have been trying without success to find out information about the review, such who is carrying it out and its terms of reference.
Yesterday, Eric Knight and Ted White, representing US funds Knight Vinke Asset Management and Calpers, which control 1pc of Shell, entered the fray with a letter to the Financial Times.
They had hoped, they said, that "this rather basic information would be disclosed to shareholders" with Shell's annual report last month.
They continued: "We believe there is a significant opportunity for the group to repair some of the confidence that has been lost by conducting this process in a manner that embraces openness and candour."
Shell said yesterday: "Shell is aware of and sensitive to these concerns and will make an announcement as soon as we are able." Company sources said an announcement would be made by tomorrow.
The statement is likely to confirm that Sir John Kerr, a non-executive director at Shell Transport, is one person carrying out the review.
Investors were surprised by Shell's reluctance. One said: "The problem is that if the company can't even tell you who is on it and what the terms of reference are, it is very difficult to have faith in the process. That is a big problem."
The news emerged as the Association of British Insurers forecast that "a number" of fund managers will attend the annual meeting. Peter Montagnon, the ABI's head of investment affairs, said: "A number of people will go. This is a somewhat unusual AGM. The quality of debate there will be more important than the actual votes."