ThisIsLondon.co.uk: US humiliation for oil giant Shell
10 June 2004
POWERFUL US investor Calpers - the California Public Employees' Retirement System - has put the Shell oil group on its hit list of companies with poor governance - a humiliation for the giant which used to pride itself on its high standards.
Calpers spotlights a series of poor practices and calls on independent directors to put them right.
Calpers is the top US campaigner for board reform and lists four big offenders, including Disney.
Among the issues it lists at Shell are underperformance, flawed accounting and 'apparent inadequacy of controls'.
Royal Dutch has a 'dominant position' in the group. Its managers have power through 'priority shares' to reject shareholders' board candidates.
Calpers says the 'mechanism is self-perpetuating' and keeps outsiders out of top jobs. It wants a clear timetable for reform.