Glossary: an A to Z of terms

The following contains an alphabetical list of terms, acronyms and abbreviations used on this website. Each term, acronym or abbreviation is followed by a brief explanation. If you think the list needs expanding to include other terms and have suggestions in that respect, please contact us by e-mail at pensioenfonds@shell.com.

The formula for calculating the retirement pension. Pension years, salary and accrual percentage are components of this formula.
Accrual percentage
The percentage of the salary that you accrue each pension year in the form of pension entitlements.
Actual contribution
The contribution established to finance the costs of the pension scheme. These are annual costs required to finance pension entitlements accrued during the year in question.
Actuarial and Operating Memorandum (ABTN)
The Actuarial and Operating Memorandum (Actuariële en BedrijfsTechnische Nota, ABTN). A document produced by the Board establishing the financial principles and the investment policy of the Pension Fund.

AFM

Authority of Financial Markets (Autoriteit Financiële Markten). One of AFM's tasks is supervising the provision of information by pension administrators. This supervision is laid down in the Pensions Act.

AOW

See: General Old Age Pensions Act

Anw

See: Survivor's Benefits Act
Assets
The resources (the financial capital and the value of the investments) that the Pension Fund has available to meet its liabilities.

An objective criterion, e.g. a stock exchange index, that the Pension Fund can use to compare the performance of its investments.

A certificate stating that you are alive.

Company pension fund

A pension fund associated with an individual company and not with a sector of trade and industry.

Consumer Price Index (CPI)

Also referred to as the price index for all households. Figure that represents the average price movement of a package of goods and services purchased by households for consumption. Expenditure relating to healthcare insurance, income tax or social security contributions
does not form part of this package.

Conversion
On your retirement date you can exchange some or all of your partner’s pension for a higher retirement pension, or vice versa; this is known as exchange or conversion.
Corporate Governance
Sound management practice. In the Netherlands, rules have been laid down for this in the Netherlands Corporate Governance Code, also referred to as the ‘Code Tabaksblat’.

Corporate pension funds industry organization (Opf)

(Stichting voor Ondernemingspensioenfondsen, Opf). Organization promoting the interests of corporate pension funds in the Netherlands and Europe.
Cost of living increase
See: indexation.
Credit years
Extra pension years to which employees who had joined the Pension Fund prior to 1st January 1985 may have been entitled on their NRD (Normal Retirement Date) under the former pension scheme. These credit years were granted as part of the transfer of the pension entitlements of those participants when transferred on 31st December 2005 and were added to their accrued pension years.

Currency hedging
By hedging against the risks associated with foreign-currency exchange rates, the Pension Fund ensures that fluctuations in the values of these currencies against the Euro have no effect on the value of the Pension Fund’s investments.

See: Former Participant.

Deferred (pension)entitlements

See: Non-contributory entitlements
Derived consumer price index
The Consumer Price Index (CPI) reflects the price development  of a package of goods and services, as they are generally purchased by households in The Netherlands. Not all cost components are included in the package, e.g. income tax, social security contributions and healthcare expenses. The Derived CPI reflects the regular CPI, without the developments indirect taxation (e.g. VAT and excise on alcohol and tobacco) and subsidies. Statistics Netherlands calculates and publishes the Derived CPI on a monthly basis.
Disability pension
The pension that you as a participant receive if you become disabled.
Disability
You are deemed to be disabled if, in the opinion of the Pension Fund, you are unable, due to sickness, deficiency, pregnancy or confinement, with little likelihood of recovery, to earn more than 20 per cent of the salary that healthy persons with similar qualifications and experience generally earn.

Disablement Benefits Act (WAO)
The Disablement Benefits Act (Wet op de ArbeidsOngeschiktheidsverzekering, WAO). Replaced by the Work and Income according to Labour Capacity Act (Wet Werk en Inkomen naar Arbeidsvermogen, WIA) with effect from 1st January 2006.
DNB
De Nederlandsche Bank (the Netherlands National Bank). One of DNB’s tasks is supervising the operations of pension funds in line with the provisions as laid down in the Pensions Act.

This is you if you are in the service of or associated with the organization of an employing company.
Employing Company
This is a company that has joined the Pension Fund.
Enrolled partner
The partner with whom you live together, and with whom you have concluded a cohabitation agreement before a civil-law notary and who you have enrolled in the Pension Fund as your partner’s pension beneficiary.
Exchange
On your retirement date you can exchange some or all of your partner’s pension for a higher retirement pension, this is known as exchange or conversion.

The Financial Assessment Framework (Financieel Toetsingskader, FTK). Several basic principles for the financial structure and position of pension funds as applied by De Nederlandsche Bank.
Fixed-interest securities
Investments with a fixed yield, such as bonds.
Former Participant
You are a Former Participant when you, as a former employee, are no longer accruing any pension entitlements and have a right to non-contributory pension entitlements that are not yet in payment.
Full-time employment
Employment in which the employee works the standard number of hours designated for his position. This is usually a 40-hour working week during the daytime. Other standards apply to the 24-hour shift system.
Funding ratio
The ratio between the assets and the pension liabilities at a point in time.

General Old Age Pensions Act (Algemene Ouderdomswet, AOW). The basic state pension for people aged 65 or older. The General Old Age Pensions Act also contains a provision for partners who are younger than 65 and who have only a low income or no income at all. The Social Insurance Bank (Sociale Verzekeringsbank, SVB) administers the General Old Age Pensions Act.
General Shareholders’ Meeting
The General Shareholders’ Meeting (Algemene vergadering van Aandeelhouders, AvA)

The insurance for medical treatment that you are required to take out pursuant to the Healthcare Insurance Act if you are living or paying wage tax in the Netherlands.

Hedge funds

Investment funds holding long positions (buying securities in the expectation that they will rise in value) and short positions (the sale of borrowed securities with the expectation that they will fall in value) at the same time. The aim is to generate stable returns that are independent of the general trend on financial markets.

High/low
High/low pension is a variation in which the retiree opts for a higher retirement pension in the years following his retirement and for a lower retirement pension in the ensuing years. Under the tax legislation, the maximum permitted variation between the highest and lowest pension level is 100:75.

Adjustment of pensions in payment and deferred pension entitlements with a supplement.

A savings scheme under which you are entitled by law to save part of your gross salary for a period of unsalaried leave. The life cycle savings scheme is unrelated to the pension scheme.
Low / high
Low / high pension is a construction in which the retiree opts for a lower retirement pension in the years following his retirement and for a higher retirement pension in the ensuing years. Under the tax legislation, the maximum permitted variation between the highest and lowest pension level is 100:75.

Value at the time of sale. In the case of investments: the value of an investment if it were to be sold.

If you leave Company service prior to your retirement date, you are eligible to receive the entitlements that you have accrued until that time. These are your non-contributory entitlements. The pension will not be paid until your retirement age. You are not required to make any more contributions until then.
NRD
Normal Retirement Date. The retirement date under the scheme in effect before 1st January 2006.

The retirement age as stated in the Regulations.

Opf
See: Corporate pension funds industry organization
Orphan
A child of a deceased Participant, Former Participant or Retiree.
Orphan’s pension
The pension to which your children are entitled up to the age of 18 in the event of your predecease. In the case of orphans pursuing academic studies, the orphan’s pension shall remain in effect until no later than the month of August following the orphan’s 24th birthday.

Your salary (12 months plus lump-sum payment in April and/or December) plus any accrued Pensionable Supplement. Your pension will be calculated on this basis.
Pension Contribution Basis
Your salary (12 months plus lump-sum payment in April and/or December) plus any Pensionable Supplement(s) to which you are entitled at that time. The pension contribution you are required to pay is calculated on this basis.
Pension contributions
You are required to make monthly pension contributions. This is calculated in relation to your Pension Contribution Basis and withheld from your monthly salary.

Pension Contribution Limit
The normal maximum of salary group 5. The pension contribution limit is adjusted each year on 1st July.

Pension entitlements / pension rights

Pension entitlements are being accrued or have not yet commenced. Pension rights are being paid. When a pension entitlement commences it becomes a  pension right, according to the Pensions Act.

Pension Fund Governance
Sound pension fund management.

Pension notification period
The number of months from the time that you announce that you plan to retire and your actual retirement date. The notification period is at least 6 months and no more than 12 months.
Pension number

The number under which your pension entitlements are administered by the Pension Fund. For participants working in The Netherlands this is the same number as the 'SP-number' (Personnel number). For participants working abroad the pension number and the SP-number are different. Your pension number is stated on the top of your pension statement.

Pension Settlement (Divorce) Act
In the case of divorce, judicial separation or termination of a registered partnership, the former partner is also entitled to part of the retirement pension. This is realized pursuant to the Pension Settlement (Divorce) Act (Wet verevening pensioen bij scheiding). Under the Act, the former partner is eligible for half the retirement pension accrued during the period of the marriage. However, partners may agree a different distribution.
Pension statement
Summary of your pension entitlements sent to you annually as a participant.
Pension years
Your number of pension years is in principle equal to the number of years in which you were in full service (100%) of Shell. If you worked part-time for a certain period, those years will count proportionately toward this. You may have extra pension years deriving from tropical or fleet service, if you have credit years, or if you have transferred pension entitlements from a previous employer.

A pension to which you are entitled in addition to your Shell pension.

Parental leave

Unpaid leave intended specifically for the care of children younger than 8 years of age.
Participant
You are a Participant if you are in the service of a Shell company and are accruing pension entitlements with the Pension Fund.
Partner
Your spouse, the person with whom you have concluded a legally registered partnership or your enrolled partner.
Partner’s pension
The pension to which your partner is entitled in the event of your predecease.
Part-time employment / Part-time percentage
Employment in which you work fewer hours than the standard number of hours designated for your position. Your part-time percentage is an indication of your working hours as a percentage of the standard number of hours per week.
Part-time retirement / Part-time pension
You can take out part-time retirement. In that case a part-time pension can be drawn while you remain in employment for 80%, 60% or 50% of your original working hours.
Pensionable Supplement
Any salary supplement that is taken into account when calculating your pension entitlements. A Pensionable Supplement is expressed as a percentage of your Pension Base Salary and is included in your pension basis according to the number of years (or: pro rata). The employer decides which supplements are pensionable.
Pensions Act
The Pensions Act (Pensioenwet). The objective of this Act is to safeguard pensions granted to employees.

Private equity
Investments in funds or enterprises not listed on the stock exchange.
Proportional supplement
The number of pension years that you were entitled to a pensionable supplement in relation to your total number of pension years, multiplied by the percentage of your supplement. In other words: if you were entitled to a pensionable supplement for a period of 15 years and you have accrued 30 pension years at the time you retire, your proportional supplement is 15/30 x your supplement percentage.

Provision for pension liabilities
Value of the accrued pension entitlements and pension rights.

You are a Retiree when you are receiving a retirement pension from the Pension Fund.
Retirement age
The age at which you retire, in principle 65 years of age. You may opt for a different age however: between 55 and 65. In consultation with your employer, you may also opt for an age between 65 and 70.
Retirement date
The date on which you retire; this is the last day of the month in which you reach the retirement age.
Retirement pension
The pension that you receive from your retirement date.
Risk coverage
Insurance has been taken out in respect of the risk of your predecease or your becoming disabled during a period of leave and the employer pays the relevant contribution for this. This ‘risk coverage’ ensures that, in the event of your predecease during a period of leave (or your becoming disabled), the pension years that you would otherwise continue to accrue until your official retirement age will be factored into the calculation of the partner’s pension (or the disability pension).

Twelve times your monthly salary plus the lump-sum payments in April and/or December (the 13th and 14th months).
SAMCo
Shell Asset Management Company B.V. Responsible for implementing the investment policy of the Pension Fund and managing the invested capital. Advises the Board in respect of investment policy.

Social Insurance Bank (SVB)

The Social Insurance Bank (Sociale Verzekeringsbank, SVB) is responsible for administering various pension and insurance schemes, including benefits granted under the General Old Age Pensions Act for people from the age of 65.

Solvency
An indication of the Pension Fund’s capability to make payments.
Special partner’s pension
The partner’s pension accrued until the divorce date that your former partner receives in the event of your predecease. This is deducted from the partner’s pension that your new partner, if you have one, would otherwise be entitled to.
SPN
Shell Pensioenbureau Nederland B.V. Is appointed Director of the Pension Fund and administers the pension scheme. Advises the Board in respect of pension policy.
SSPF
Stichting Shell Pensioenfonds (Shell Pension Fund Foundation). The official name of the Pension Fund.
Supplementary partner’s pension
Supplement to the pension to which your partner is entitled up to the age of 65, in the event of your predecease.

Survivor's Benefits Act (Anw)
Benefit received under the Dutch National Survivor's Benefits Act (Algemene nabestaandenwet, Nabestaandenuitkering Anw) is a government benefit that is granted following the predecease of a partner or parents. Eligibility for this benefit depends on a number of conditions. The Social Insurance Bank (Sociale Verzekeringsbank, SVB) administers the Survivor's Benefits Act on behalf of the government.

Transitional pension and Under-65 allowance.
Temporary pension
The pension that may be paid on top of your retirement pension until you turn 65. Under the fiscal rules, a temporary pension may not exceed the benefit for a married couple as awarded under the General Old Age Pensions Act.
The Pension Fund
The Shell Pension Fund Foundation (Stichting Shell Pensioenfonds, SSPF).
Transitional pension
Temporary payment from the retirement date up to the age of 65 to replace the benefit under the General Old Age Pensions Act (AOW).

Temporary payment from the retirement date until the age of 65 in order to compensate for the higher level of taxation and social security contributions up to the age of 65.
Unpaid leave
A defined period during which, with your employer’s approval, you do not carry out any work and during which you do not receive any salary.

UWV

Uitvoeringsinstituut Werknemersverzekeringen. Administration of, amongst others, unemployment benefits (WW) and disability benefits (WIA).

Transfer of pension rights accrued with a former employer to the pensions administrator of a new employer, with the aim of minimising pension discontinuity wherever possible. A new employer may be one outside Shell. It is of course possible that Shell will be your new employer. In other words, value transfer can work in both directions: joining the Pension Fund or leaving the Pension Fund.

See: Disablement Benefits Act

WM

World Markets Company. Compares the return on inverstments of pension funds in the Netherlands.
Work and Income according to Labour Capacity Act (WIA)
The Work and Income according to Labour Capacity Act (Wet Werk en Inkomen naar Arbeidsvermogen, WIA). This Act replaced the Disablement Benefits Act (Wet op de ArbeidsOngeschiktheidsverzekering, WAO) with effect from 1 January 2006.