Board engagement day - Royal Dutch Shell...While we believe our portfolio is resilient under a wide...
Transcript of Board engagement day - Royal Dutch Shell...While we believe our portfolio is resilient under a wide...
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Board Engagement Day
Royal Dutch Shell plcDecember 13, 2018
#makethefuture
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Chad HollidayChair of the Board
Royal Dutch Shell plc
Royal Dutch Shell 2December 13, 2018
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Definitions & cautionary note
Capital investment comprises capital expenditure, exploration expense excluding well write-offs, new investments in joint ventures and associates, new finance leases and investments in Integrated Gas, Upstream and Downstream equity securities, all of which on
an accruals basis. This presentation contains the following forward-looking Non-GAAP measures: Capital Investment. We are unable to provide a reconciliation of the above forward-looking Non-GAAP measure to the most comparable GAAP financial
measures because certain information needed to reconcile the above Non-GAAP measure to the most comparable GAAP financial measure is dependent on future events some which are outside the control of the company, such as oil and gas prices, interest
rates and exchange rates. Moreover, estimating such GAAP measures with the required precision necessary to provide a meaningful reconciliation is extremely difficult and could not be accomplished without unreasonable effort. Non-GAAP measures in respect
of future periods which cannot be reconciled to the most comparable GAAP financial measure are calculated in a manner which is consistent with the accounting policies applied in Royal Dutch Shell plc’s financial statements.
This presentation contains data and analysis from Shell’s new Sky Scenario. Unlike Shell’s previously published Mountains and Oceans exploratory scenarios, the Sky Scenario is targeted through the assumption that society reaches the Paris Agreement’s goal of
holding global average temperatures to well below 2°C. Unlike Shell’s Mountains and Oceans scenarios which unfolded in an open-ended way based upon plausible assumptions and quantifications, the Sky Scenario was specifically designed to reach the Paris
Agreement’s goal in a technically possible manner. These scenarios are a part of an ongoing process used in Shell for over 40 years to challenge executives’ perspectives on the future business environment. They are designed to stretch management to consider
even events that may only be remotely possible. Scenarios, therefore, are not intended to be predictions of likely future events or outcomes and investors should not rely on them when making an investment decision with regard to Royal Dutch Shell plc securities.
Additionally, it is important to note that Shell’s existing portfolio has been decades in development. While we believe our portfolio is resilient under a wide range of outlooks, including the IEA’s 450 scenario (World Energy Outlook 2016), it includes assets
across a spectrum of energy intensities including some with above-average intensity. While we seek to enhance our operations’ average energy intensity through both the development of new projects and divestments, we have no immediate plans to move to a
net-zero emissions portfolio over our investment horizon of 10-20 years. Although we have no immediate plans to move to a net-zero emissions portfolio, in November of 2017, we announced our ambition to reduce our net carbon footprint in accordance with
society’s implementation of the Paris Agreement’s goal of holding global average temperature to well below 2°C above pre-industrial levels. Accordingly, assuming society aligns itself with the Paris Agreement’s goals, we aim to reduce our Net Carbon
Footprint, which includes not only our direct and indirect carbon emissions, associated with producing the energy products which we sell, but also our customers’ emissions from their use of the energy products that we sell, by around 20% in 2035 and by around
50% in 2050.
Also, in this presentation we may refer to “Shell’s Net Carbon Footprint”, which includes Shell’s carbon emissions from the production of our energy products, our suppliers’ carbon emissions in supplying energy for that production and our customers’ carbon
emissions associated with their use of the energy products we sell. Shell only controls its own emissions but, to support society in achieving the Paris Agreement goals, we aim to help and influence such suppliers and consumers to likewise lower their emissions.
The use of the terminology “Shell’s Net Carbon Footprint” is for convenience only and not intended to suggest these emissions are those of Shell or its subsidiaries.
The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate legal entities. In this presentation “Shell”, “Shell group” and “Royal Dutch Shell” are sometimes used for convenience where references are made to Royal Dutch
Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to Royal Dutch Shell plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by
identifying the particular entity or entities. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this presentation refer to entities over which Royal Dutch Shell plc either directly or indirectly has control. Entities and unincorporated arrangements
over which Shell has joint control are generally referred to as “joint ventures” and “joint operations”, respectively. Entities over which Shell has significant influence but neither control nor joint control are referred to as “associates”. The term “Shell interest” is
used for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest.
This presentation contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than
statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown
risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Royal
Dutch Shell to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as “aim”, “ambition’,
‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘goals’’, ‘‘intend’’, ‘‘may’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘plan’’, ‘‘probably’’, ‘‘project’’, ‘‘risks’’, “schedule”, ‘‘seek’’, ‘‘should’’, ‘‘target’’, ‘‘will’’ and similar terms and phrases. There are a number of factors
that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this presentation, including (without limitation): (a) price fluctuations in crude oil and
natural gas; (b) changes in demand for Shell’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the
identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and
regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts
with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous
dividend payments. All forward-looking statements contained in this presentation are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking
statements. Additional risk factors that may affect future results are contained in Royal Dutch Shell’s Form 20-F for the year ended December 31, 2017 (available at www.shell.com/investor and www.sec.gov). These risk factors also expressly qualify all forward-
looking statements contained in this presentation and should be considered by the reader. Each forward-looking statement speaks only as of the date of this presentation, December 13, 2018. Neither Royal Dutch Shell plc nor any of its subsidiaries undertake
any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking
statements contained in this presentation. We may have used certain terms, such as resources, in this presentation that the United States Securities and Exchange Commission (SEC) strictly prohibits us from including in our filings with the SEC. U.S. Investors are
urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov.
Royal Dutch Shell 3December 13, 2018
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Agenda Plenary presentations
Board overview
Nomination and Succession Committee
Audit Committee
Corporate and Social ResponsibilityCommittee
Remuneration Committee
Q&A
Drinks
Chad Holliday
Chad Holliday
Euleen Goh
Sir Nigel Sheinwald
Gerard Kleisterlee
14:00 – 15:30
15:30 – 16:00
16:00 – 17:00
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Born April 20, 1955. A Singaporean national, appointed a Non-executive Director of the Company with effect from September 2014.
Euleen Goh September 2014
Chair of the Audit Committee
Non-Executive
Born March 9, 1948. A US national, appointed Chair of the Company with effect from May 2015, having previously served as a Non-executive Director since September 2010.
Chad Holliday September 2010
Chair of the BoardChair of the Nomination and Succession Committee
Born September 28, 1946. A Dutch national, appointed a Non-executive Director of the Company with effect from November 2010 and appointed Deputy Chair and Senior Independent Director with effect from May 2018.
Gerard KleisterleeNovember 2010
Deputy Chair and Senior Independent DirectorChair of the Remuneration CommitteeNomination and Succession Committee
Royal Dutch Shell 5
Born June 26, 1953. A British national, appointed a Non-executive Director of the Company with effect from July 2012.
Sir Nigel Sheinwald GCMGJuly 2012
Chair of the CSRCRemuneration Committee
December 13, 2018
The Board of Directors
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Born September 13, 1962. A Canadian and French dual national, appointed a Non-executive Director of the Company with effect from June 2017.
Catherine J. HughesJune 2017
CSRCRemuneration Committee
Born October 13, 1954. A Brazilian national, appointed a Non-executive Director of the Company with effect from October 2017.
Roberto SetubalSeptember 2017
Audit committee
Born September 11, 1954. A US national, appointed a Non-executive Director of the Company with effect from June 2011.
Linda StuntzJune 2011
CSRC
Nomination and Succession Committee
The Board of Directors
Non-Executive
Born April 14, 1955. A Canadian and British dual national, appointed a Non-executive Director of the Company with effect from May 2018.
Ann GodbehereMay 2018
Audit Committee
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Born May 6, 1952. A Dutch national, appointed a Non-executive Director of the Company with effect from January 2013.
Gerrit ZalmJanuary 2013
Remuneration Committee
Audit Committee
The Board of Directors
Non-Executive
Born April 7, 1967. A US national, appointed General Counsel Corporate with effect from August 2016 and Company Secretary with effect from January 2017.
Linda M. SzymanskiJanuary 2017
Company Secretary & General Counsel Corporate
Company Secretary
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Executive
Born April 23, 1958. A Dutch national, appointed Chief Executive Officer of the Company with effect from January 2014.
Born January 29, 1968. A US national, appointed Chief Financial Officer of the Company with effect from March 2017.
Ben Van Beurden January 2014
Chief Executive Officer
Jessica UhlMarch 2017
Chief Financial Officer
December 13, 2018
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Board Focus
Safety, Ethics & Compliance - The Goal is Zero
World class shareholder returns
Financial and operational results compared to competition and plan
Strategy development and implementation
Stakeholder engagement, including investors, employees, communities and governments
Excellent governance with a highly engaged Board
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Goal Zero on safety – TRCF1 Process safety
1 Total Recordable Cases Frequency; 2 A Tier 1 Process Safety Event is a loss of primary containment (LOPC) with the greatest consequence as defined by API and IOGP; 3 A Tier 2 Process Safety Event is a LOPC with lesser consequence as defined by API and IOGP.
Injuries per million working hours
HSSE priority Performance &
transparency
Number of incidents (excluding sabotage)
Tier 1 incidents2 Tier 2 incidents3
Royal Dutch Shell 9
HSSEPerformance
December 13, 2018
Ytd Q3Ytd Q3
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Our PurposeWe power progress together by providing more and cleaner energy solutions
#makethefuture
RDS Strategy
Winning Capabilities
Strategic Ambitions
AspiredPortfolio
World Class Investment Case
Thrive in the Energy Transition
Strong Societal Licence to Operate
Customer Centricity Commercial Value Delivery Technology Commercialisation Project Delivery Operational Excellence
CashEngines
EmergingOpportunities
GrowthPriorities
Underpinned by our Values, Goal Zero, and People
Royal Dutch Shell 10December 13, 2018
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Joint Statement
The Joint Statement is available on the Shell Investor website
Joint statement developed with institutional investors on behalf of Climate Action 100+
Royal Dutch Shell 11December 13, 2018
Public short-term Net Carbon Footprint targets
Targets linked to remuneration
Review of progress
Alignment with the TCFD recommendations
Corporate climate lobbying
3 or 5 year targets to operationalize the long-term NCF ambition (target setting will start in 2020)
Link between energy transition and long-term remuneration
Subject to a shareholder vote at the 2020 AGM
Annual update on the progress towards the NCF ambition
Initial disclosures in Sustainability Report, but with a commitment,to integrate this into the Annual Report/Form 20-F as appropriate
Disclosure of metrics and targets used to assess and manage relevant climate-related risks and opportunities, where material, at relevant intervals
Review of trade associations memberships to assess alignment with the company’s stated positions
Results of this review will be made public in Q1 2019
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Chad HollidayChair of the Nomination and Succession CommitteeRoyal Dutch Shell plc
Royal Dutch Shell 12December 13, 2018
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Responsibilities
Assessment of Board composition
Appointment process for Directors
Succession planning
Corporate governance guidance
Together with CEO recommend appointments to the Executive Committee
Annual assessment of the Board’s performance
Nomination and Succession Committee
Chad HollidayChair
Linda StuntzGerard Kleisterlee
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Our purpose as
NOMCO
We lead the process for board appointments and oversee senior management appointments
We plan well in advance for succession and review plans regularly
We spend time getting to know the candidates for Non-executive Director, Executive Director, and Executive Committee positions and we ensure the pipeline is robust, diverse and adaptive
Having the best leaders lead Shell. Today and tomorrow.
Royal Dutch Shell December 13, 2018 14
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Our purpose as
NOMCO
4 Board appointments (3 Non-executive Directors and CFO)
Strengthened range of skillsets and diversity of Board:
Near gender parity (45% female)
Regional/National diversity expanded (SA/Brazil complementing UK, NL, NA/US/Canada and Asia/Singapore)
Skillset & Industry experience broadened
Strengthening the diversity of the Board and senior management
Continuous strategic assessment of Board composition adaptive to future needs
Board and Committee evaluations
Strengthening corporate governance
Since last governance event in 2016 and looking forward
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Engagement on topics
2018 UK Corporate Governance Code
Stakeholder engagement expectations
Workforce engagement methods
Chair tenure
‘Comply and explain’
Diversity and inclusion on the Board and in Senior Management talent pipeline
Gender parity
Hampton-Alexander review
Commitment to strengthen all areas of diversity
Any other topics – feedback requested
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Euleen GohChair of the Audit CommitteeRoyal Dutch Shell plc
Royal Dutch Shell 17December 13, 2018
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Ann Godbehere Roberto SetubalEuleen GohChair
Responsibilities
Financial reporting, disclosures and accounting policies
Effectiveness of risk management and internal control systems
Relevant legal and regulatory compliance
Oversight of internal and external auditors
Advises the Board on appointment of external auditors for shareholder vote
Report to shareholders on how responsibilities have been fulfilled
Audit Committee
Royal Dutch Shell 18December 13, 2018
Gerrit Zalm
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CSRC site visit, Nigeria
2019
Lease standard (IFRS 16) implementation
Performance assessment of external auditor
Risk culture
Regulatory developments, tax regimes and
compliance
New business models and ventures
Oversight legal proceedings
Pennsylvania Chemicals, USA
Areas of focus
Audit Committee 2018
IFRS 9, 15 & 16 implementation
Accounting estimates and judgments
Information risk management
and GDPR data privacy
Group insurance policy and arrangements
Trading & Supply visit
Retirement benefit arrangements and disclosures
Oversight legal proceedings
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Internal and external audit coverage
200+ audits per year
Audit committee sets scope in alignmentwith: risk profile and materiality
The Chief Internal Auditor is accountableto the chair of the audit committee
External quality assessment carried out in 2018
Audit committee oversight
Transitioned external auditor in 2016 following competitive tender – and EY reappointed in 2018
Comparative insights provided on key areas of accounting estimates and judgements
Internal Audit External Audit
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Sir Nigel SheinwaldChair of the CSRCRoyal Dutch Shell plc
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Linda StuntzCatherine J. Hughes
Sir Nigel SheinwaldGCMGChair
Responsibilities
Review policy and performance for Shell General Business Principles and Code ofConduct
Review management of HSSE and social impacts of projects andoperations
Review major issues of public concern such as climate change
Monitor emerging environmental, ethical, reputational, and social issues
Input into the Shell Sustainability Report
Corporate and Social Responsibility Committee
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Areas of focus
CSRC topics2018 2019
Environment & greenhouse gas Net Carbon Footprint & nature based solutions
Environmental license to operate topics
Contributions to SKY and SET report
Ethics & compliance Societal license to operate
Safety Process safety
Country focus Pakistan, Nigeria, Netherlands (Groningen)
Environment & greenhouse gas Shell’s role in the light of Paris commitments
Methane and plastics
Advice to REMCO on energy transition and remuneration
Ethics & compliance Conduct & Culture
Safety Process safety, Road transport,
Country focus Nigeria, Brazil, Canada (LNG Canada),
Netherlands (Groningen)
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Culture & Conduct
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CSRC site visit, Nigeria
2018 Nigeria & Netherlands
Nigeria
Met with local NGOs, Government bodies and senior officials, and embassies
Netherlands – Moerdijk
Discussed process safety and local site challenges
Pennsylvania Chemicals, USA
Activity examples2017-2018
CSRC
2017 Netherlands, USA & UK
Netherlands – Pernis refinery
Challenges and opportunities for the facility
UK – Bacton gas plant
Met with staff to discuss safety and community members to discuss, among other topics, how to redistribute sand and sediment to protect the coastline
USA – Chemicals project Pennsylvania
Met with local stakeholders and contractors to discuss a range of HSSE topics
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Pakistan Incident
Event and Investigation
Immediate investigations in Pakistan after the incident in 2017
Comprehensive causal investigation in 2018, insights communicated to Board, EC and management teams
Action
Detailed deep dive in CSRC in October 2018, looking at insights plus actions already taken and being implemented in Pakistan and globally, and follow-up in CSRC in 2019
Various reviews at Board and CSRC meetings
Regular updates on progress of company-wide actions
Royal Dutch Shell December 13, 2018
Note: Additionally, in October 2018 a Shell customer’s lory in route to a retail station had rolled-over killing a relief driver. Approximately 40,000 litres of fuel spilled, the fuel did not ignite and no communities appeared to have been impacted. A preliminary
investigation indicated that the driver of the lory had fallen asleep prior to the crash.
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Rewarding performance in line with delivery of strategy
GHG metrics in remuneration
The GHG metrics in the 2018 scorecard have evolved and coverage has increased to close to 90% of the Scope 1 and 2 operated emissions, compared to 60% in 2017
CEO personal performance agreement includes strategy and progress in new energies
Scorecard aligned for Directors and staff
Each year targets are set for the scorecard considering stretch and past performance
Annual bonus scorecard design
Strategy drives change
Remuneration follows and supports strategy
Cash flow from operating activities Operational excellence Sustainable development
2017 2018
5% Process safety
5% Personal safety
10% GHG management
10% Environment
10% Safety
Scope expanded2:
Upstream and Integrated Gas GHG intensity in million tonnes CO2e (4%)
Refining GHG intensity measured in tonnes CO2e per UEDC1 (3%)
Chemicals GHG intensity measured in tonnes CO2e per tonne of chemicals production (3%)
5% Process safety
5% Personal safety
10% GHG management
1 Solomon’s Utilised Equivalent Distillation Capacity; 2 Updated 15 October 2018: % reflect the weighting for 2017, the definition is for 2018. The weighting and full 2018 scorecard architecture will become available in the 2018 Annual Report
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Gerard KleisterleeChair of the Remuneration CommitteeRoyal Dutch Shell plc
Royal Dutch Shell 27December 13, 2018
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GerritZalm
Sir Nigel SheinwaldGCMG
GerardKleisterleeChair
Catherine J. Hughes
Responsibilities
Setting the Directors’ remuneration policy
Review workforce remuneration and related policies
Agreeing performance frameworks, setting targets for remuneration and reviewing performance
Determining the actual remuneration, benefits and contractual terms
Monitoring and recommending the structures and levels of remuneration for other seniorexecutives
RemunerationCommittee
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Areas of focus
REMCO
Ongoing shareholder
engagement
throughout
policy review
Royal Dutch Shell December 13, 2018
2018 2018 AGM voting Early considerations on 2020
remuneration policy review Shareholder and proxy agency dialogue Energy transition and remuneration
2019 Engage with shareholders Conclude policy review Incoming changes to governance and reporting
Nov 2016
May 2017
March2018
May 2018
Summer 2018
Nov 2018
Winter 2018
2018 -2019
May 2020
Shareholder engagement on remuneration policy
Shareholder vote on remuneration policy (92.3% support)
Remunerationreportpublished
Shareholder vote on 2017 remuneration report (74.78%)
Proxy agency engagement
Shareholder engagement
Proxy agency engagement
Ongoing remuneration policy review and shareholder/ proxy engagement
Shareholder vote on remuneration policy
Policy review
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2018 AGM voting
Directors’ Remuneration Report
2017 AGM Remuneration policy support: 92.3%
2018 AGM Remuneration report support: 74.78%
The Committee was disappointed with the voting outcome on the Directors’ Remuneration Report at the 2018 AGM given the strong shareholder support for the remuneration policy in 2017.
We respect the broad range of shareholders and other stakeholders and noted the evolution of views from ISS on remuneration structure and concerns around disclosures in respect of the Pakistan incident.
Considering circumstances outside of management control, there was no impact on the Directors’ 2017 remuneration. For further information relating to this incident, please review our detailed disclosure.
We will consider future disclosures, to ensure the thoughtful work undertaken by the Board is more appropriately reflected in the Annual Report.
Remuneration structure will be part of the policy review (to be voted on in May 2020) and we will continue engagements with shareholders in the coming months.
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Alignment with strategy
Strategy How the strategy links to the CEO’s variable pay elements
Thrive in the energy transition
World-class investment
case
Strong licence
to operate
CEO INDIVIDUAL PERFORMANCE
LONG-TERM INCENTIVE PLAN
ANNUAL BONUS
The vision for thriving in the energy transition is led by
the CEO and embedded in his individual performance targets.
World-class investment metrics such as cash generation and capital
discipline, as well as value created for shareholders, are included
in the LTIP.
Licence to operate measures such as operational excellence and
sustainable development are included in the scorecard. The measures are
key building blocks to being a world-class investment
case and support our journey to thrive in energy transition.
Fixed pay 21% Variable pay 79%Target CEO pay mix
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Energy transition Remuneration vehicle Appropriate metric Time horizon
Attract and retain Pay mix Target levels Comparator group
Pay for performance Bonus: structure, measures and targets
(e.g. addressing bonus asymmetry) LTIP: length, vesting schedule and metrics Alternative structures
Governance Malus and clawback Shareholding requirements
Remuneration policy – May 2020
Strategy drives pay, pay supports strategy
Areas of focus
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Questions & Answers
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RDS Governance structure &board responsibilities
Finance Corporate & Human ResourcesLegal
Royal Dutch Shell 35
Executive Committee – led by CEO
Board – led by Chair
December 13, 2018
Audit CommitteeCorporate and
Social Responsibility Committee
Nomination and Succession Committee Remuneration Committee
Upstream Integrated Gas & New Energies Downstream Projects & Technology
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Risk appetite framework
Strategic Operational Conduct
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Financial Framework
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Royal Dutch Shell April 16, 2018
Oversight of climate change risk management
37
Corporate and Social Responsibility Committee (CSRC) (2)
Audit Committee(AC) (3)
Remuneration Committee(REMCO) (4)
Board of RoyalDutch Shell plc (1)
Executive CommitteeGovernance and Commitment
Quarterly reports, work issues, choose options, developing scorecard
NCF Analysis Strategic Decisions
Monitoring and Reporting
(1) Oversight of climate change risk management. (2) Non-executive Directors appointed by Board to
review and advise on sustainability policies and practices including climate change.
(3) Non-executive Directors appointed by the Board to oversee the effectiveness of the system of risk management and internal control.
(4) Non-executive Directors appointed by the Board to set the remuneration policy in alignment with strategy.
NCF Forecasting
NCF Methodology, Model and Analysis
Business Ownership
Functional Support
December 13, 2018
AspiredPortfolio Premises Business
Planning
Assurance SocietalProgress Reporting
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Royal Dutch Shell April 16, 2018
Thrive in the energy transition
Driving to resilience and ambition
Demonstrating Shell’s approach across multiple time horizons
TIME HORIZON
SHORT TERMGHG
management
Focussed on operational action
Included in annual bonus scorecard
MEDIUM TERMStrategic positioning and
portfolio resilience
Disclosures aligned to TCFD recommendations
Demonstrate financial resilience of portfolio to energy transition and climate change actions
LONG TERMNet Carbon Footprint (NCF)
NCF methodology covers lifecycle emissions from our energy products
Energy transition and remuneration being considered in current REMCO policy review
1-3 YEARS 5-10 YEARS >10 YEARS
5% Process safety
5% Personal safety
10% GHG management
Sustainable
development
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Financial framework
Capital stewardship
Excludes BG acquisition in 2016; historical BG capital investment is based on BG’s published Annual Report. 2018-2020 capital investment outlook excludes IFRS 16 impact. Definition and reconciliation can be found in the Investors’ Highlights 2013-2017.
Capital investment
$25-30 billion organic & inorganic
Board Oversight Driving cash &
returns
Strategic Themes: Today to 2020
-$12 billion
30
25
Shell
BG
Royal Dutch Shell 39December 13, 2018
SHALESNEW ENERGIES
Growth priorities
CHEMICALS DEEP WATER
Emerging opportunities
Cash engines
CONVENTIONAL OIL + GAS
OIL PRODUCTS
INTEGRATED GAS
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Board evaluation and succession planning
Performance evaluation –
confidential online questionnaire,
external facilitation
Chair Performance evaluated by anonymised
questionnaire by all Board members
External facilitator
Led by Nomination& Succession Committee
Board
Executive Director
Executive Committee
Evaluation Succession planning
Key considerations:
Effectiveness
Implementation of previous
recommendations
Major challenges past & future
Key considerations:
Senior leadership enablers
Performance history
Future role requirements
UK Corporate Governance Code
Annual process 3-yearly Longer-term, ongoing
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