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Royal Dutch/Shell severance deals not agreed yet

Financial Times: Royal Dutch/Shell severance deals not agreed yet

By Clay Harris

May 24, 2004

Royal Dutch/Shell has not yet agreed the severance packages for Sir Philip Watts, the sacked chairman of its committee of managing directors, and two other executive board members who lost their jobs this year.

The delay means that the postponed 2003 annual report, to be published on Friday, will not contain the final settlements for the three executives, even though the Anglo-Dutch oil group has stretched its normal financial calendar ) by two months to deal with its reserves restatement crisis.

It appears to guarantee, moreover, that the controversy over departed directors will rumble on, in parallel with investigations by the Securities and Exchange Commission and Justice Department in the US, as well as regulators in the UK and the Netherlands.

It also emerges ahead of a two-day strategy review meeting of 400 senior Shell managers from around the world that begins today at the Woodlands Resort, a conference centre outside Houston, US.

The other executives affected are Walter van de Vijver, who lost his job as head of exploration and production in March at the same time as Sir Philip’s dismissal, and Judy Boynton, who stepped down as finance director last month after being criticised in an internal report into the company’s handling of the reserves issue.

Sir Philip was paid a total of £1.8m in 2002, including a basic salary of £745,969. Mr van de Vijver received a total of €1.66m, including a basic salary of €735,095. Both men had a notice period of three months.

Ms Boynton joined the committee of managing directors (CMD) during 2003, so her 2002 salary is not available.

Shell said in March that none of the CMD members – departed or surviving – would receive a performance-related bonus for 2003.

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