The Wall Street Journal: Shell's Ex-Chairman Got Pay Raise in 2003

By CHIP CUMMINS

Staff Reporter of THE WALL STREET JOURNAL

June 1, 2004

LONDON -- Philip Watts, ousted earlier this year as chairman of Royal Dutch/Shell Group for his role in the oil company's energy-reserve accounting scandal, took home a 13% raise in base pay in 2003. Sir Philip earned £843,021 ($1.6 million or €1.3 million) in salary and fees, according to Shell's annual report.

Sir Philip and other top executives received no annual bonus for 2003, a move Shell announced earlier this year in the midst of disclosures that it had greatly overstated its reserves of oil and natural gas. Without the bonus, Sir Philip's pay for the year fell by 47%.

In addition to his base salary, Sir Philip received 1.16 million stock options that can be exercised in 2006. Sir Philip was also awarded 79,697 Shell shares as deferred bonus. The compensation for 2003 doesn't include Sir Philip's severance package, which is still being negotiated, according to a Shell spokesman.

Shell's directors removed Sir Philip in March, after the initial findings of an internal inquiry into the company's overstated reserves. Shell's board also ousted Walter van de Vijver, former head of exploration and production, and reassigned Judy Boynton, formerly the company's chief financial officer.

Write to Chip Cummins at chip.cummins@wsj.com