An update on pay and variable pay
For all the resilience we showed last year, it still cannot equate to the financial success we had hoped for in 2020. As you know, we were far from meeting the conditions that would allow us to deliver a Group annual bonus for 2020 of anything other than zero. And I know that is still a big disappointment.
Unlike some other companies, though, we chose not to reduce base pay as part of the short-term cash preservation measures we took in 2020. Even in the face of what were acute cost pressures, we think preserving salaries amid the uncertainty was right. Back in April, we did have to set expectations that any salary increases would be very low – if they were increased at all. I can confirm now that salaries will not be adjusted in February 2021 for the majority of Shell employees.
As disappointing as that may be, it’s important to know that Shell’s remuneration remains competitive – even without any increases this year.
Moreover, looking ahead, we want to again be able to share success with staff. Our 2021 Group Scorecard will be published later this month after Strategy Day. It will be based on the new operating plan for 2021, and provides a competitive bonus opportunity for employees. Eligibility for share awards and pay benchmarking will continue this year, to make sure we remain competitively positioned. And we know how important it will be – after we have set out our strategy later in February — that we all feel we have a shared stake in Shell’s future. I’ll share more on this later in the month.