Shell CEO's pay rises while profits fall significantly
- Shell's CEO Wael Sawan's compensation rose to £8.6 million in 2024, including a substantial bonus and share awards.
- The increase in pay occurred despite a 16% decrease in company profits, totaling $23.7 billion.
- The situation highlights potential concerns over corporate governance, especially amidst ongoing cost-cutting and emissions goals.
In the United Kingdom, Shell disclosed that Wael Sawan, the CEO, received a total compensation of £8.6 million for the year 2024, reflecting a 9% increase from the previous year’s £7.9 million. This rise came in spite of the company's reported profits declining by 16%, with earnings dropping to $23.7 billion from $28.3 billion in 2023. The increase in pay included an annual bonus of £2.9 million and £3.9 million in long-term share awards, indicating a level of reward that starkly contrasts with the financial setbacks faced by the company despite reducing costs and its workforce. Furthermore, Sawan's base salary itself was raised from £1.45 million in 2024 to £1.54 million in 2025, coinciding with an overall workforce pay rise of 5.5%. This scenario unfolds against a backdrop of Shell's significant efforts to enhance shareholder returns even as it publicly committed to cutting costs and improving operational efficiencies. Beyond the compensation issues, Shell aims to achieve substantial cuts in annual spending, targeting a reduction of $5 billion to $7 billion by 2028, significantly up from prior goals of only $2 billion to $3 billion by 2025. In pursuit of these savings, the company highlighted the importance of leveraging technology and artificial intelligence while maintaining strict controls over contractor costs, which had already seen a 30% reduction since 2023. Additionally, Shell is poised to invest in lowering carbon intensity, although the firm has faced criticism for diluting some of its previous climate commitments. Amidst these changes, Sawan articulated his vision for the company to become the leading integrated gas and liquefied natural gas business in the world, emphasizing a decrease in carbon intensity by 15% to 20% by 2030 in comparison to 2016 figures. As such, the juxtaposition of increased executive remuneration amid declining profits and promises of cutbacks raises questions about corporate governance and accountability in the energy sector.