Case Study: Incorporating ESG Metrics into Executive Compensation

November 2020

Discussions on environmental, social, and governance ("ESG") topics are not new to companies in the energy sector. In December 2018, Royal Dutch Shell PLC ("Shell"), the British-Dutch oil and gas company, went a step beyond health and safety compliance when it announced it would incorporate carbon reduction metrics into its executive incentive plan.

This article examines the process Shell undertook in implementing these metrics, and the role shareholders played throughout.