Two investor advisory firms have recommended Royal Dutch Shell shareholders oppose the CEO’s 2015 remuneration, in the latest sign of rising discontent over pay amid falling oil prices.
Shell Chief Executive Ben van Beurden’s 2015 remuneration fell 8 percent to 5.135 million euros ($5.63 million) last year, when the company’s revenue dropped sharply due to low oil prices.
Proxy adviser Glass Lewis said in a report it remains “concerned by the disconnect between bonus payouts and financial performance, and the bonus scheme structure more generally”.
In a separate report, adviser PIRC said “the ratio of CEO pay compared to average employee pay is 37:1, which is unacceptable”.
Both firms recommended shareholders oppose the remuneration packages in a vote at Shell’s annual general meeting in The Hague next week.
A Shell spokesman said Shell’s executive compensation “reflects delivery of our strategy, measured by both short-term and long-term targets. There is a clear alignment between the company’s performance and our compensation policies”.
Shareholders have become increasingly vocal over executive salaries and bonuses amid slumping earnings and lower commodity prices.
Last month, BP’s shareholders voted against Chief Executive Bob Dudley’s $20 million pay deal for 2015, a rare investor revolt for such a major company, after it recorded a record annual loss.
Van Beurden’s total 2015 package, including pension and tax equalization, was 5.576 million euros, down from 24.198 million euros in the previous year, mainly due to a significant fall in van Beurden’s pension which was positively affected in 2014 by promotion to chief executive.
In April last year, Shell launched a bid for smaller rival BG Group which it completed in February this year for $54 billion.
By Ron Bousso
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