Shell Plc · LSE:SHEL
Shell — Royal Dutch Shell — Non-Deal Roadshow (November 2019)
20 slides from Shell's roadshow presentation, November 2019
Slide 1: Remuneration Shareholder Engagement November 2019
DTT Za AWNUANULLUULERLLL AVLANUULLANULLUNY Remuneration i i HH it AL wu November 2019 tit Shareholder Engagement Royal Dutch Shell ple Gerard Kleisterlee Chair of the Remuneration Committee #MakeTheFuture
Slide 2: Definitions and Cautionary note
Definitions and Cautionary note For LITP purposes, ROACE ((Return on Average Capital Employed) is defined as net income for the current and previous three quarters, as a percentage of the average capital employed for the period. Capital employed consists of total equity, current debt and non-current
Slide 3: Themes for today
Themes for today = Approach to remuneration and alignment to strategy = Update on 2019 pay for performance = The Energy Transition metric = 2020 policy recommendation Royal Dutch Shell | November 20
Slide 4: Alignment with strategy
Alignment with strategy Strategy and link to 2019 remuneration policy Strong World-class Thrive in Strategy licence to investment the energy operate case transition How the strategy links to the CEO's ANNUAL BONUS eats variable pay Measures to drive focus on the financial and World class investment
Slide 5: 2017 LTIP vesting outcome
2017 LTIP - . Total shareholder return [A] Cash flow from operations growth [B] vesting outcome Shell Shell BP Chevron Total BP Chevron Total ExxonMobil ExxonMobil = 10.0% 20.0% 30.0% 0.0% 50.0% 100.0% 150.0% 200.0% Free cash flow ROACE growth [C] Absolute metric measured against Chevron cumulative
Slide 6: Pay for performance - potential pay outcome
Pay for performance - Daily total shareholder return growth: 2017 LTIP potential pay 60.0% | __ other oil majors [A] —— Shell outcome 40.0% 20.0% (20.0%) 4 £ Estimated 2019 CEO single figure at Q3 2019 [B] = Strong performance relative to oil majors || = Share price growth and dividend Fixed pay Bon
Slide 7: Historical pay outcomes
Historical pay outcomes CEO base salary €/000 1,800 % 43.2% 725% 5 9 43.3% Ben van Beurden 5 42.5% +2.0% 1,600 0% 1 640] cream ecko a) +2.1% +2.1% 1,550} er 1,557 1,500] 1,490 I 1,200 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Annual Bonus Scorecard outcome LTIP vesting outcome 2 200% — 10-ye
Slide 8: Short term
▪ ▪ ▪ ▪ Short term ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ◼ ▪ ▪ ▪ ▪ ◼ ▪ ▪
Slide 9: Operation of energy transition measure in the LTIP
Operation of energy transition measure in the LTIP Energy Transition Energy transition vesting [A] Measure 10% weighting - expect to increase over time spoaroes 7 yepgaror’ Combination of leading and lagging ’ OX measures \ \ Targets set as ranges | { < Commercially sensitive targets so will be a !
Slide 10: Managing Quantum Outcomes
Managing Quantum Outcomes = Remuneration Committee continues to reflect on quantum WD Royal Dutch Shell | November 2019, 2020 Policy Review Deliberations For the 2020 policy review the Committee has been carefully considering matters regarding quantum. As part of our thinking, we have sought the inp
Slide 11: Executive directors participate in home country pension arrangements
m Executive directors participate in home country pension arrangements on the same basis as others. = We believe this is aligned with the spirit of the recent developments in corporate governance. ) Royal Dutch Shell | Novemt 2019 (Ben van Beurden) Mr van Beurden participates in the Dutch pension ar
Slide 12: Upcoming Remuneration Committee Key Milestones
Upcoming Remuneration Committee Key Milestones Forward looking agenda = 12-13 December: Chair of Board Roadshow = December 2019 - March 2020: Remuneration Committee determines 2019 annual bonus 2020 salaries and LTIP award = February / March 2020: vesting of the conditional share awards made in 2017
Slide 13: OY & 2) SY = vn © w ¢ Od
OY & 2) SY = 0 vn © w 3 ¢ Od
Slide 14: Short term Long term
◼ Benchmarked against 4 oil majors and 15 European companies Short term ◼ Short-term operational delivery 30% 50% 50% cash targets ◼ 50% bonus in shares, subject to 12.5% Project delivery 20% 3-year holding period which 12.5% Production 12.5% LNG liquefaction 50% shares remains in force post-leaving
Slide 15: Rewards the delivery of short-term operational targets
2019 Rewards the delivery of 12.5% short-term 50% 10% 10% operational targets 12.5% 20% 12.5% 5% 30% 10% 12.5% 5% Cash flow from operating activities Operational excellence Sustainable development ◼ 10% ◼ ◼
Slide 16: Shareholder alignment and longer time horizons
Shareholder alignment + longer time horizons = 3 year bonus and LTIP holding periods WD Royal Dutch Shell | Novemb Uy Net shares held for 3 performance . years period 50% delivered in cash 50% delivered in shares Long Term 3 year Incentive Plan performance period Net shares held for 3 years 100% del
Slide 17: Energy Transition
Energy Transition m We have set a long- term ambition to reduce the Net Carbon Footprint of our energy products by around 20% by 2035 and by around 50% by 2050, in pace with society. Royal Dutch Shell | November 2019, Carbon Footprint of the energy mix (gCO2e/MJ) 80 60 50 40 30 Our Net Carbon Footpr
Slide 18: Pensions
Pensions Pensions — 2019 (Jessica Uhl) » Ms. Uhl’s base country is the US and she is seconded to work in the Netherlands. » All US employees participate in both the Shell Pension Plan (SPP) and Shell Provident Fund (SPF] = SPP provides two defined benefit pension formulas: + The 80-Point Formula is
Slide 19: Remuneration timeline
Remuneration timeline REMCO has engaged with shareholders and proxy agencies as part of the policy renewal process WD Royal Dutch Shell | November 2019, Shareholder Engagement T T Nov May 2016 2017 Shareholder engagement on remuneration policy Autumn = Autumn 2019 2019 Ongoing Shareholder remunerati
Slide 20: Slide 20
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