The Guardian: Shell in row over executive bonuses
Saturday May 15, 2004
Shell, the Anglo-Dutch oil group, was hit by fresh controversy yesterday after it was accused of failing to report a long-term bonus plan for senior executives to the Dutch financial regulator.
AFM, the financial market watchdog, said it was in talks with Royal Dutch/Shell about the issue of 63,000 shares -worth €2.6m (£1.75m) at yesterday's prices - to chairman Jeroen van der Veer under a long-term incentive plan.
But the company insisted that the new chairman's bonus plan had been backed by more than 90% of shareholders at the annual meetings of both its British and Dutch arms.
The group, hit by a 25% downgrade of its oil and gas reserves and the enforced resignation of three top executives, said it only had to notify AFM when the stock changed hands - set for three years hence.
A spokesman told Reuters: "Our lawyer has confirmed that notification was unnecessary as the total value of the long-term incentive plan depends on the meeting of performance criteria. It is not fixed and could turn out to be nil."
Mr van der Veer, who with other current and former executives could face criminal charges in US courts over the reserves scandal, replaced Sir Philip Watts in early March.
In 2002 Mr van der Veer was paid €2.25m, including a basic salary of more than €1m, as president of the group's Dutch arm. Shell has delayed publication of last year's report because of the reserves issue.
Sir Philip earned £1.8m, a rise of 55%, despite presiding over a 23% drop in earnings, and faced substantial protests at last year's annual meeting when almost a quarter of shareholders voted against the group's remuneration policy.