Shell Plc · LSE:SHEL
Shell — Royal Dutch Shell — Non-Deal Roadshow (March 2020)
23 slides from Shell's roadshow presentation, March 2020
Slide 1: Remuneration Shareholder Engagement
DTT Za AWNUANULLUULERLLL AVLANUULLANULLUNY Remuneration Il ‘ih i Ni NAH wu Shareholder Engagement _ ’ Royal Dutch Shell ple Gerard Kleisterlee Chair of the Remuneration Committee March / April 2020 #MakeTheFuture
Slide 2: Definitions and Cautionary note
Definitions and Cautionary note ROACE [Return on Average Copital Employed) is defined os the sum of current cost of supplies (CCS) eornings attributable to shareholders excluding identified items forthe current and previous three quarters, as a percentage of the average capital employed for the some
Slide 3: Themes for today
Themes for today = Approach to remuneration and alignment to strategy = 2019 pay outcomes = 2020 proposed policy Royal Dutch Shell | Mar 3}Apr
Slide 4: Alignment with strategy
Alignment with strategy 2017 AGM - Remuneration policy support: 92.34% = 2019 AGM Remuneration report support: 89.93% WD Royal Dutch Shell | Mar 3/Apr 3, Strategy and link to 2019 remuneration Strong World-class Thrive in Strategy licence to investment the energy operate case transition How the stra
Slide 5: 2019 annual bonus outcome
2019 annual bonus outcome CEO 2019 target bonus reduced from 150% to 125% Downward discretion applied to scorecard CEO bonus: €800,000 CFO bonus: €500,000 Royal Dutch Shell | Mar 3}Apr 3, 2019 annual bonus outcome [A] Measures Weight (% of scorecard) Target set Result achieved Score (0-2) Cash flow
Slide 6: 2017 LTIP - vesting outcome
2017 LTIP - . Total shareholder return [A] Cash flow from operations growth [B] vesting outcome BP BP RDS Chevron TOTAL Shell CHEVRON Total EXXON ExxonMobil - 10% 20% = 30% 0% 50% 100% 150% Free cash flow ROACE growth [C] 100 Shell 80 Target Total $(bn) 60 $85 bn BP = Strengthening of 40 financial f
Slide 7: Delivery in 2019
Delivery Financial in 2019 Framework Delivery Portfolio & projects delivery Delivery Financial in 2017- Framework 2019 Delivery ◼ Portfolio & projects delivery
Slide 8: CEO single figure
CEO single figure CEO single figure reduced by more th 50% from 2018 Royal Dutch Shell | Mar 31 Ap CEO pay outcome Fixed . remuneration Barn enefi €1,577,387 Target b 2019 scorecard = Cx: , ety «400,001 Vesting outcome: [B] Change in share price: [C] Accrued dividends: [D) mp 198,900x 147% = 292,383
Slide 9: 2019 and historical pay outcomes
2019 and Base salary Ten year single figure history Historical pay 1,800 20,000 10year outcomes average: €12.5m +2.5% 15,000 +3.2% 1,600 433% ma 9 2.5% om en van Beurden 49 9 *21% 10,000 my ] Ya = Ton | 1,400 5,000 | om BEE eee eee 1,200 = €'000 €'000 2 2s 22 2 2 8 & gs 2010 2011 2012 2013 2014 2015
Slide 10: Managing 2020 Policy Review Deliberations
Managing 2020 Policy Review Deliberations Quantum Y Outcomes For the 2020 policy review the Committee has focussed on three objectives: Remuneration policies must support the achievement of Shell's strategic goals: this is our overriding imperative. Providing an externally competitive package to att
Slide 11: Managing Quantum and the use of discretion
Managing Quantum Quantum and the use of discretion Outcomes We understand that the quantum and variability of outcomes causes concern for some shareholders. As part of our thinking, we sought the input of major shareholders as well as the voting advisory services, testing our diagnosis of the issue
Slide 12: Proposed directors' remuneration policy 2020
Proposed directors’ remuneration policy 2020 = Focus on simplification and transparency = Maintain pay for performance and strategic alignment ) Royal Dutch Shell | Mar 3}Apr 3, 2020 Remuneration policy changes Policy element Proposed changes Rationale Annual bonus [A] Long term incentive plan Discr
Slide 13: Summary for 2020 AGM Voting
Summary for 2020 AGM Voting Royal Dutch Shell | Mar 3}Apr Annual Report on 2019 Remuneration v Annual Bonus scorecard - adjusted downwards further for fatalities. v Strong LTIP performance for 2017-2019 against four key financial metrics ¥ 2019 variable pay mainly in shares which is subject to furth
Slide 14: Upcoming Remuneration Committee Milestones
Upcoming Remuneration Committee Milestones Forward looking agenda = May 2020: AGM = November 2020: REMCO Chairman roadshows = December 2020 - March 2021: Remuneration Committee determines 2020 annual bonus 2021 salaries and LTIP award = February / March 2021: vesting of the conditional share awards
Slide 15: OY & 2) SY = vn © w ¢ Od
OY & 2) SY = 0 vn © w 3 ¢ Od
Slide 16: Short term and Long term incentives
◼ 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 17: Shareholder alignment and longer time horizons
Shareholder alignment + longer time horizons = 3 year bonus and LTIP holding periods WD Royal Dutch Shell | Mar 3}Apr 3, Uyecr 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
Slide 18: Single total figure of remuneration for Executive Directors
201 9 Si ng I e (€ Thousands) Ben van Beurden Jessica Uhl [A] total figure of 2019 2018 2019 2018 remuneration Salaries 1,557 1,527 1,015 995 for Executive Taxable benefits 20 32 51 49 Directors Total fixed remuneration 1,577 1,559 1,066 1,044 Annual bonus [B] 800 3,000 500 1,550 LTIP [C] 7/191 15,2
Slide 19: Energy Transition Measure
Transition Measure = Applies to around 150 senior managers from 2019 and to be extended to around 16,500 employees from 2020 Royal Dutch Shell | Mar 3/Apr 3, Operation of energy transition measure in the 2019 LTIP Lagging - NCF reduction target 2019 - 2021 performance period - Measured against 2016
Slide 20: Energy Transition Ambitions
Energy Transition Ambitions: Reduce Net Carbon Footprint of our energy products by ~20% by 2035 Be in line with society Net Carbon Footprint by 2050 Royal Dutch Shell | Mar 3}Apr 3, Carbon Footprint of the energy mix (gCO2e/MJ) 80 60 50 40 30 Our Net Carbon Footprint Ambition 2015 2020 2025 2030 203
Slide 21: Pensions - Ben van Beurden
= Executive directors participate in home country pension arrangements. = We believe this is aligned with the spirit of the recent developments in corporate governance. Royal Dutch Shell | Mar 3}Apr 3, 2019 (Ben van Beurden) » Mr van Beurden participates in the standard NL = ‘The current age related
Slide 22: Pensions - Jessica Uhl
Pensions = Executive directors participate in home country pension arrangements ) Royal Dutch Shell | Mai 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 Pro
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