As can be seen in his testimony, Simon Henry deliberately limited the amount of time that Walter van de Vijver spent with UK and US investors, almost as if there was something to hide? Wonder what current Shell investors will make of that revelation? An insight into how Mr Henry thinks shareholders can be manipulated and shielded from potential spontaneous outpourings of the truth. The Dutchman wouldn’t learn his lines.
“I am becoming sick and tired about lying,” said Walter van de Vijver (right), senior executive at Royal Dutch/Shell. Photo Credit: Chris Ratcliffe/Bloomberg News
Candid testimony of Simon Henry about the disgraced Shell Exploration And Production Chief Executive, Walter van de Vijver (shown right).
Simon Henry became Head of Shell Group Investor Relations in March 2001. His predecessor was Walter van de Vijver.
Extracts from the sworn testimony of Simon Henry to the U. S. Securities and Exchange Commission on 19 October 2004 in Washington D.C. The reference to “one on one” meetings, was in regard to Shell senior management meetings with analysts and investors.
As can be seen in the testimony, Simon Henry deliberately limited the amount of time that Walter van de Vijver spent with UK and US investors, almost as if there was something to hide? Wonder what current Shell shareholders will make of that revelation? An insight into how Mr Henry thinks shareholders can be manipulated and shielded from potential spontaneous outpourings of the truth. The Dutchman wouldn’t learn his lines.
Q: When is the first time you had discussions with Mr. Watts about the booking of Gorgon?
A: I think it was probably early January 2004.
Q: How about with Mr. van der Vijver?
A: The first discussion I had with Walter on the subject of certain bookings was in February 2003…
Q: Did he explain the nature of those reserves?
A: Not really. He shrugged his shoulders in a way that suggested if it was done by the previous chief executive of EP, what am I to do.
Walter was always rather laid back and the glass was always half empty, a natural kind of thing.
Q: After that point, at which he said, well, there were some bookings, was there any corrective action that you took with respect to Mr. Watts’ initial comments in this area?
A: The statement of the discussion with Mr. van de Vijver is correct. Was there any follow up action. My implication was — I think I probably addressed it earlier — I raised it with Walter for Walter to resolve with Phil as to what their story should be, rather than me necessarily me following up separately.
Phil and Walter, there was no secret in the company again that they were not best of friends, but the emotional edge was not really there.
Walter’s response of, you know, shrugging his shoulders, just about sums it up. Yes, I inherited an area that was under invested, and I just have to play the cards I have been dealt, and shrug your shoulders.
Walter was the least effective communicator of all the MDs.
Q: Was that a valid belief?
A: Yes, I do think it was a valid belief.
Q: Let me ask you this, Mr. Henry. After you spoke with Walter van de Vijver, when he gave you the shoulder shrug, did you think that what Mr. Watts had said regarding Gorgon and regarding Orman Langen, was potentially inconsistent with what Mr. van de Vijver said, that there was an inconsistency between those two things?
A: I guess the inconsistency was the enthusiasm with which they spoke. One would talk over the table, this is a great thing, a big project. I’m excited about it and I’m going to make sure it gets delivered. Walter would sat back and said, oh, yeah, there’s Gorgon and Orman Langen as well, a completely different approach. That can give a different perspective to the person who is in both meetings.
Q: Did he give you any specifics in terms of volumes at that point?
A: Walter was not a numbers guy.
I mentioned earlier, every two to three weeks, we would have a 15 to 30 minute meeting, usually at 8:00 in the morning, an update on market, trends, announcements by competitors, feedback we had and any interaction we had with the market. We would use that if our meeting was a suitable timing or we were doing something else.
Phil liked to prepare himself, and looked for advance preparation. Judy was similar, but less rigorous and disciplined. With Walter, it was impossible to engage him before the meeting.
Walter, we found it very, very difficult to engage in preparation.
Q: You mentioned several times now that it was difficult preparing Mr. van de Vijver for these one on one meetings.
Q: Why was that the case? Why did you feel that way?
A: I mentioned Phil was an insidious preparer. Walter was the exact opposite. He didn’t prepare for anything.
Q: Did you discuss Mr. van de Vijver’s lack of preparation with him?
A: Inasmuch as I could. He was confident that he knew his brief.
Q Did he always know his brief, in your opinion?
Q: Did you make an effort in the 2002 and 2003 time frame to limit Mr. van de Vijver’s contact with outside investors?
A: Serious U.K. and U.S. investors; yes.
Q: I asked you earlier about communications that might have been incomplete or inaccurate that Mr. van de Vijver provided to the market. Were there instances where Mr. van de Vijver provided IR or you with incomplete or inaccurate information?
A: Walter personally barely provided us anything.
Q: I’ll ask the same question, were there times when EP provided IR or you with incomplete or inaccurate information?
We will shortly publish the complete sworn testimony so that all of the extracts can be viewed in context.
THE SADISTIC SACKING OF SHELL CHIEF EXECUTIVE WALTER VAN DE VIJVER: updated Sat 17 Nov 2007 with complete van de Vijver deposition