Baby Ace: Shell boss Ben Van Beurden"s plans for the company are overshadowed by former boss Peter Voser"s £22m pay deal

Thursday, March 13, 2014

Shell boss Ben Van Beurden"s plans for the company are overshadowed by former boss Peter Voser"s £22m pay deal

By

Rob Davies

Shell boss Ben van Beurden’s grand plan to spruce up the oil giant has been overshadowed by criticism of his predecessor’s £22million two-year pay deal.

The Dutchman set out a blueprint that will see Shell shrink its North American shale operations and improve efficiency by focusing on individual projects and businesses.

But some investors seized on the fact that former boss Peter Voser earned £22million over two years – including a £1.5million bonus for 2013, a year that ended with the group’s first profit warning in a decade.

Blueprint: Ben van Beurden set out plans that will see Shell shrink its North American shale operations

One veteran City fund manager said: ‘Van Beurden said the 2013 performance was not what he expects from Shell. That begs the question of why any bonus was paid at all.’

He also questioned Shell’s decision to wait until the January 1, 2015 deadline to implement new laws making pay policies binding, when even Barclays has activated the policy pre-emptively.

Waiting until next year will allow Shell to make ‘ex gratia’ payments outside of its pay policy, in what the fund manager called a ‘loophole of accountability’.

But both the fund manager and investor lobby group ShareAction welcomed van Beurden’s plan to link pay to return on capital employed, which measures a company’s profitability and efficiency.

Sources close to the company also pointed out that Voser’s total pay fell in line with Shell’s performance, more than halving to £7million last year as profits fell 38 per cent.