Daily Express (UK) Shell execs to win big bonuses: “The group's previous bonus scheme, now scrapped, was widely discredited because it was controversially linked to increases Shell made in booking reserves.” (ShellNews.net)
1 Nov 04
JEROEN van der Veer and his fellow bosses at Royal Dutch Shell will see their pay packages surge after the merger of the oil giant's two operating companies into one UK-fisted group.
The board is thought to believe there is a need for more generous bonuses for executives in the light of Shell's new status as one of the largest members of the FTSE 100.
Although chief executive van der Veer, who was paid €1.13million (£785,000) last year, and Shell's executive directors are not expected to receive an increase to their basic salaries the board is considering putting in place substantial new performance targets worth millions of pounds.
This would bring them more into line with their rivals at BP where chief executive Lord Brown’s bonuses boosted his pay last year to £3.2 million.
Shell executives have the lowest-paid managers in the oil industry. "New performance targets for the whole management team will be laid down," said an insider
The group's previous bonus scheme, now scrapped, was widely discredited because it was controversially linked to increases Shell made in booking reserves.
Last week Shell warned it would probably miss this year's target for finding oil to replace what it has pumped because another downgrade in its reserves was likely.
Longsuffering investors will want bonuses firmly pegged to reserve replacement targets.
Van der Veer is aiming to find a replacement for 100 per cent of reserves in the next five years.