The Observer: Axe hangs over more Shell directors
Sunday April 18, 2004
The futures of several Shell directors are in the balance this weekend as the board meets in The Hague to discuss an internal report into the company's admission that it over-stated its oil reserves. Shell later cut its estimates by 20 per cent.
A draft copy of a report into the affair, commissioned by Shell's audit committee, will be published shortly amid increased speculation that more directors could be axed in the wake of the scandal.
Finance director Judy Boynton is regarded as particularly vulnerable. Even the new chairman, Jeroen van der Veer, could face criticism if the report finds he was warned the reserves were lower than Shell claimed in its regular updates to the City.
Filings made in 2002 with the SEC, America's stock market regulator, suggest that Boynton and van der Veer were briefed about the situation.
The overstating has prompted the biggest crisis in the history of the Anglo-Dutch company. It is the subject of two separate investigations by the SEC and the UK's Financial Services Authority.
Van der Veer replaced Sir Philip Watts, who resigned last month, along with Walter van de Vijver, the company's former head of exploration and production. It is understood that the report says Watts and van de Vijver were at fault.
Boynton has hired a former SEC lawyer to represent her as the investigation into the affair continues.
In a statement issued through his lawyer last week, van der Vijver criticised Shell for firing him 'without credible explanation' and claimed that he had talked to Shell's board about the extent of overstated reserves once he had uncovered the problem last year. 'I communicated my findings to the committee of managing directors without delay,' he said.