London Evening Standard: SHAMED “Shell chairman Sir Philip Watts has secured a pay-off worth more than £1m in cash plus stock options potentially worth £6m more”
25 June 2004
OUSTED Shell chairman Sir Philip Watts has secured a pay-off worth more than £1m in cash plus stock options potentially worth £6m more at current share values.
The huge pay-off, just months after he admitted the oil and gas giant had vastly overstated its levels of proven reserves going back five years, has already sparked anger among shareholder and corporate governance activists.
Watts resigned on 3 March but takes home £1,057,971 in cash, equivalent to 15 months' pay up to his planned retirement date of June 2005, and is still sitting on more than 2.8m stock options. He has the right to cash in £114,237 of those options now and is in the money on more than half of the rest - worth some £6m at the current share price - which he is allowed to cash in at various points until March 2009.
Sarah Wilson, of shareholder action group Manifest, said: 'While shareholders may be outraged at the payment there is precious little they can do. However, this may well stoke the fire for anyone considering a class action.'
The US Securities and Exchange Commission and Department of Justice are investigating Shell and its directors. A Shell spokesman 'refused to speculate pending the outcome of investigations' but could not rule out future action by the company against Watts.
The National Association of Pension Funds said that, while it would back Shell's remuneration policy at the upcoming AGM, 'we will also take into account the extent of any compensation paid to Sir Philip Watts during the course of the year'.