Corporate governance affects the way we direct our company and the relationship we have with interested parties. We believe that the highest standards of corporate governance are essential to our business integrity and performance.
The Companies (Miscellaneous Reporting) Regulations 2018
In accordance with the Companies (Miscellaneous Reporting) Regulations 2018, directors are required to explain how they have considered the interests of companies’ key stakeholders and broader matters set out in section 172(1) (A) to (F) of the UK Companies Act 2006 (‘S172’) (‘Section 172 Statement’), when performing their duty to promote the success of companies to which they are appointed, under S172.This includes considering the interest of stakeholders which will have an impact on the long-term success of companies. Certain UK subsidiaries in the Shell group are required to produce and publish a S172 statement and these are available below:
NYSE governance standards
The Corporate Governance Standards of the New York Stock Exchange (NYSE) allow foreign private issuers, like Royal Dutch Shell, to follow home country practices on most corporate governance matters, but require them to disclose any significant ways in which their corporate governance standards differ from those followed by US companies.
Royal Dutch Shell is an English company listed on the London Stock Exchange and is subject to the authority of the Financial Services Authority (FSA) in the United Kingdom. Consequently, Royal Dutch Shell follows the corporate governance principles set out in the UK Corporate Governance Code (the Code). Set forth below is a summary of the significant ways in which our corporate governance practices differ from US companies under the NYSE listing standards.
Non-executive Director Independence
The Board follows the provisions of the Code in respect of Non-executive Director independence. The Code states that at least half the Board, excluding the Chairman, should comprise Non-executive Directors determined by the Board to be independent. In the case of the Company, the Board has determined that a majority of Non-executive Directors are wholly independent.
Nominating/Corporate Governance Committee and Compensation Committee
The NYSE listing standards require that a listed company maintain a Nominating/Corporate Governance Committee and a Compensation Committee, both composed entirely of independent directors and with certain specific responsibilities. The Company’s Nomination and Succession Committee and Remuneration Committee, respectively, comply with these requirements, except that the terms of reference of the Nomination and Succession Committee require only a majority of the committee members to be independent.
As required by NYSE listing standards, the Company maintains an Audit Committee for the purpose of assisting the Board’s oversight of the financial statements, its internal audit function and its independent auditors. The Company’s Audit Committee is in full compliance with the US Securities and Exchange Commission’s Rule 10A-3 and Section 303A.06 of the NYSE Listed Company Manual.
However, in accordance with English law, the Company’s Audit Committee makes recommendations to the Board, for it to put to shareholders for approval in General Meeting, regarding the appointment, re-appointment and removal of independent auditors. Consequently, the Company’s Audit Committee is not directly responsible for the appointment of independent auditors.
Shareholder Approval of share-based compensation plans
The Company complies with the listing rules of the UK Listing Authority (UKLA) which require shareholder approval for the adoption of share-based compensation plans which are either long-term incentive schemes in which Directors can participate or schemes which may involve the issue of new shares.
Under the UKLA rules, such plans cannot be changed to the advantage of participants without shareholder approval, except for certain minor amendments, for example to benefit the administration of the plan or to take account of tax benefits. The rules on the requirements to seek shareholder approval for share-based compensation plans, including those in respect of material revisions to such plans, may deviate from the NYSE listing standards.
Code of Ethics
The NYSE listing standards require that listed companies adopt a code of business conduct and ethics for all directors, officers and employees and promptly disclose any waivers of the code for directors or executive officers. The Company has adopted the Shell General Business Principles which satisfy the NYSE requirements. The Company also has internal procedures in place by which any employee can raise in confidence accounting, internal accounting controls and auditing concerns. Additionally, any employee can report irregularities to management through a worldwide dedicated telephone line and website without jeopardising his or her position.
Articles of Association
Articles of Association
The Articles of Association is available in pdf format.
Special Resolutions and certain other business passed at the Royal Dutch Shell plc Annual General Meeting held on May 22, 2018, in pdf format.
The Certificate of incorporation on change of name and re-registration of a private company as a public company, available in pdf format.
The Davies Report
The Board has issued a statement in response to the report by Lord Davies of Abersoch (the ‘Davies Report’) published in February 2011.
In response to the report by Lord Davies of Abersoch published in February 2011 entitled ‘Women on Boards’ (the ‘Davies Report’), the Board of Royal Dutch Shell plc has issued the following statement:
“The Board welcomed the Davies Report on Women on Boards and its recommendations. The Board and the senior succession planning of the Company in general takes into consideration a number of factors including gender and other diversity criteria: by 2015 it is expected that at least 25% of the Directors will be women, as recommended by the Report.”