FT.com site: Hostility to oil giant abates
By Sundeep Tucker in London
Jun 17, 2004
After weeks of mounting investor demands to reveal details of its governance review, the lid finally flew off the Shell pressure cooker on Thursday.
A series of meetings between Shell executives and investors during the past few weeks produced deadlock over the latter's key demand: that the review be transparent. Investors raised the stakes this week when Calpers, the giant US pension fund, complained in a letter to the FT about the secrecy surrounding the review.
Robert Talbut, chief investment officer of Isis Asset Management, on Thursday said: "It is a welcome move but regrettable that Shell only appears to have moved after mounting press coverage. It could have volunteered this weeks ago."
One Shell source denied it had only acted after intense public criticism from shareholders. "There's been an element of opportunism on the part of certain shareholders when they knew we had a board meeting coming up anyway."
But, after the hostility of recent weeks, the company was bathing in rare positive reviews.
Eric Knight, managing director of US-based Knight Vinke Asset Management, which co-signed the Calpers letter said: "This is an encouraging statement and the first tangible evidence to outsiders that deficiencies in Shell's governance and board structures are finally being addressed."
The company still faces awkward questioning at its annual meetings on June 28. Mr Talbut said: "I am disappointed that it looks like there will be no shareholder involvement in the review process prior to November."
One investor said: "We will attend the meeting but the hostility of the questioning is likely to have been reduced following today's revelations."