Good morning. I'm Chad Holliday. I'm delighted to welcome you each to this 2021 annual general meeting of Royal Dutch Shell PLC. I hope you enjoyed that opening video. Our last AGM was limited due to COVID, and we are all sadly still managing the challenges of the ongoing coronavirus pandemic. On behalf of the board, we sincerely hope that you and your loved ones are staying safe, healthy, and for those of you who have lost loved ones, our deepest condolences. Due to the coronavirus restrictions, unfortunately, it's still not possible to return to our normal AGM format, where we welcome the physical presence of our shareholders and enjoy engaging face-to-face. In what we hope is the next best alternative, we have embraced technology and introduced a hybrid meeting this year, providing a platform for shareholders to both vote and ask questions. The clear benefit of this is being able to welcome the participation of those shareholders who normally haven't been able to attend our AGMs in person. With that introduction, I confirm that we have a quorum present. Now I declare the annual general meeting formally open and suggest that, with your permission, the notice of convening the meeting is taken as read. In accordance with the company's articles of association, and as stated in the notice of meeting, will be held in English. For those watching via the Lumi platform, voting will be open throughout the meeting and will remain open 15 minutes following the conclusion of the meeting. Once you have voted, you can change your vote, but when the voting closes, your last choice will be submitted. </edited_transcript In accordance with the company's articles of association, as contemplated by the notice of meeting, I hereby call for a poll to be taken on each resolution, and I'm appointing the company's registrars, Equiniti, to act as scrutineers. I hereby propose each of the resolutions 1 to 21 set out in full in the meeting notice. Resolutions 1 to 17 and 20 are proposed as ordinary resolutions, therefore each requires a simple majority of the votes cast in favor in order to be passed. Resolutions 18, 19, and 21 are proposed as special resolutions, therefore, each of these resolutions requires at least a 75% majority of votes cast in favor in order to be passed. The poll is now open. Before I introduce the board and those shareholders that want to ask questions, please refer to the guide on the Lumi platform. To allow sufficient time for other shareholders wanting to ask questions, please keep your questions and comments short, to the point, and relevant to the business of today's meeting. For those who choose to ask their questions via the teleconference facility, if I believe your question or statement is excessively long, please note that I may ask you to bring it to a close. I intend, where possible, all questions or comments of a similar nature are grouped together. Grouping questions and comments in this way will help avoid repetition, ensure we address as many issues as possible. I also request your patience if there's a lot of interest in any one particular issue. As chair of the meeting, I have a duty to ensure that today's proceedings are conducted in a proper and orderly manner, and I will do my utmost to ensure that all shades of opinion are given a fair hearing. To help me fulfill these responsibilities, I would ask that you respect our procedures and order of the meeting. Let me start by introducing the members of our board who are seeking re-election today. Their biographies are provided within the notice of meeting, which is duly circulated to shareholders on April 15th and added to our website on the same day. For those watching the meeting via the Lumi platform, a copy of the notice of meeting can be found under Documents tab on your screen. For those watching on the webcast, it can be found on the AGM section of our website. As you can see, two of our directors, our Chief Executive, our Chief Financial Officer, are here with me today, as well as our Company Secretary. The other directors are joining us remotely and should appear on the screen when I introduce them. It's also a pleasure to see we have a good number of shareholders joining us online. Starting with my right, Ben van Beurden, our Chief Executive Officer. Jessica Uhl, our Chief Financial Officer. On my left, Company Secretary, Linda Coulter. Moving to those joining us online, we have Euleen Goh, our Deputy Chair and Senior Independent Non-executive Director and Member of the Nomination and Succession and Remuneration Committee. Dick Boer, who is a Member of the Audit Committee, and following this meeting, subject to his re-election, Dick will become a Member of our Nomination and Succession Committee. Neil Carson, Chair of our Remuneration Committee and a Member of the Safety, Environment, and Sustainability Committee. Ann Godbehere, Chairman of the Audit Committee and a Member of the Safety, Environment, and Sustainability Committee. Catherine Hughes, a Member of the Safety, Environment, and Sustainability Committee. Subject to her re-election, she will chair the Committee from tomorrow. Catherine is also a Member of our Remuneration Committee. Martina Hund-Mejean. Martina Hund-Mejean joined the Board following last year's AGM and is a Member of our Audit Committee. Sir Andrew Mackenzie, who joined the Board in October of 2020 and is a Member of our Nomination and Succession Committee. A couple of years back, we announced that I would be retiring from the Board following this AGM. In March of this year, we announced Andrew will be my successor. Andrew will become chair subject to his re-election after this completion of this meeting and will likewise chair the Nomination and Succession Committee. Sir Andrew has extensive leadership experience in our sector. He has a PhD in organic chemistry, a member of the Royal Society, and is considered one of the world's most influential earth scientists. I am honored to turn over my Shell duties to such a talented leader. Ram Shriram, who also joined our board in October of last year, is a member of the Safety, Environment, and Sustainability Committee. Gerrit Zalm, a member of the Audit Committee and a member of the Remuneration Committee. We also have Jane Lute joining us today, who will be a new addition to our board if shareholders approve her election. If approved, Jane will join the board starting tomorrow. Her biography is also in the notice of meeting, which outlines her skills and experience gained from her years of public service in military and private sector. We hope you support her election. Last but far from least, I'd also like to introduce Sir Nigel Sheinwald, who is not seeking re-election today. Nigel is Chair of the Safety, Environment, and Sustainability Committee and a member of our Nomination and Succession Committee. This is Sir Nigel's last AGM with Shell, and he will retire from the Board following this meeting. Sir Nigel has been on the Shell Board for nine years and leaves behind a strong leadership track record. The Board is deeply grateful for his many years of dedicated service. Nigel, on a personal basis, I will miss you. I will miss your broad questions and observations that take full into account our stakeholders as well as our shareholders. We also appreciate your strong leadership of Safety, Environment, and Sustainability Committee at a critical time in our company. You have read in the notice of meeting that not only is this meeting open to shareholders, but it's also a webcast meeting open to the forum to the public for any of your interested stakeholders to join. Therefore, we also warmly welcome those that are watching the meeting in that way. We will now transition to the two prepared presentations for today's meeting. The first one will come from myself, and then I'll turn it over to our Chief Executive Officer. Today is my last day at Shell. I want to thank every one of our shareholders for allowing me the opportunity to serve you for the past 10 years. It has been one of the honors of my professional life. Six years ago, when the board asked me to take on the additional duties of chairing, I took out three months to visit Shell facilities. I wanted to see the real Shell. I wanted to see our people in action, the issues they're facing, their challenges for the future, and what was important to them. In Singapore on one of these trips, I was having dinner, a very informal dinner around picnic tables, and I was moving around to different tables to get to talk to more people and listen to them. I sat down next to this man. I asked him the very simple question, "In three weeks, I'll become chair of the board of Shell. What would you like me to do?" He looked me right back in the eye and said, "My 13-year-old daughter is embarrassed to tell her friends at school that her dad works for Shell. I want you to fix that." That's what I call a real conversation. I took that very seriously. I considered his request because I knew it wasn't because he was unhappy with Shell. He's an engineer working on a project, liked what he was doing. He's very proud of his company. This was the perception his daughter had. I considered hundreds of things that came from that three months of visits, but this one kind of stood out on top, and I took as a personal goal. I was going to make sure every day I continued to serve Shell, I was going to do my best to be able to answer to that 13-year-old daughter that I could be proud of everything Shell's doing, and everyone else is doing the same thing. My report to you today will be on progress. I will use three examples to say how are we doing at gaining the respect of everyone. The first one is about a time of crisis. Obviously, I'm talking about the COVID-19 pandemic, a real crisis. The crisis is still with us today. You can tell a lot about a company and its people and how they hold up in this kind of a period. You've seen our retail in action. You've seen our people show up to work to provide fuel for the community. It's so vital in a pandemic time like this. Yet you've also seen us modify our shops, we provided what people need when the other supply chains were breaking down, maybe fresh fruit, maybe produce, even toilet paper. I am proud of our retail people that showed up that you could see. What you couldn't see as well is the people in our plants and facilities and processing units that showed up every day to make sure the world had energy, which is so critical during this pandemic period of time. If you read my letter in the annual report, I talked about one such facility. I talked about a shift superintendent at a regasification plant in India who had a conversation with his 11-year-old son about why he needed to go to work because the gas his plant produced allowed for electricity and allowed for heat for people's homes. I checked in with him last week, recognizing how much more difficult the pandemic has become in India. I can report to you he's doing well. He's still showing up for every one of his shifts, and his family is healthy too. Shell people showed up in the pandemic, and we all should be proud of them. Example two is one of my proudest moments in my time with Shell. It occurred 18 months ago, and even though we had made steady progress for years, under the leadership of Ben, the management of the company, and the board of directors, we concluded we just were not moving fast enough, and we had to accelerate the transformation of Shell. Now, I remind you, 18 months ago was before COVID-19 was on our screen. We continued through that process, and I could not be more proud of our board and our management team to keep searching for how do we accelerate. In February of this year, Ben and his team presented to the world our plan going forward. We present to you, our shareholders today, for an advisory vote, that plan for our transition. We hope you will consider it very seriously and focus on a yes vote because we believe it is the right plan for our company at this point in time. We are in no way trying to get you to take over responsibility for our duties in asking for this vote. We do want you with us, and we do want to understand your ideas. We'll come back to you every year with a progress report and give you a chance to give us feedback or vote on that. Every 3 years, we'll update the plan because we think that will be necessary. I am very proud of this plan. What's critical now, though, is implementing. I started off by telling you we have people doing the job every day in a pandemic. We have a great plan that I'm very proud of. What about the people of Shell that will spend the next several decades implementing that plan and taking us all the way to net zero? I had to talk to them before I could report back to you today. I chose people with about eight years of service. They knew Shell, they knew the jobs, they knew what we were doing, but they have decades left to work. They will be the ones that can see us through to net-zero. I picked eight people from five different countries, four men, four women. They work in our upstream businesses, our transition business, and also growth. They range from hydrogen to wind power to exploration to chemicals production, even nanotechnology. This is an important time for us to get a feel for those individuals and how they see this plan. If they don't believe in this plan and can't implement it won't happen. I can report to you today, those eight people, which were selected not by me, and I never met them before, absolutely support this plan. They pushed me. They said, "Can we move faster? Can we be bolder?" When I talked to them about priorities, we weren't in full agreement on what the priorities are yet. I think that's very natural at this time, and it's encompassed in the fact that we want to give you progress reviews and updates as we go through the process. Let me just give a couple quotes. "This is an audacious plan. It has unlocked passion in our people. It's something like we have never done before. if we don't do this now, we will lose the opportunity." If we don't do this now, we will lose the opportunity. The woman that said that was looking right through that video screen into my eyes. as I looked at her eyes, I was hearing her say, "If we don't do this now, you're going to lose me because I'm going to make a difference in the world. I want to do it at Shell, but Shell must move forward now." That's why your vote for this resolution is so important. It will send a message not just to the eight people I talked to, but it'll send a message to the tens of thousands of Shell people that have to deliver this plan over the decades ahead. In summary, I believe we have demonstrated that 13-year-old daughter should be proud to tell her friends her dad works for Shell. Reality is that 13-year-old is now a 19-year-old young woman thinking about what additional education she might want and where she might want to work. If I could have her here today, I could report on the last six years to say, "You can respect this company. I will give you my word on it from everything I've seen." I would hand her a copy of our energy transition report. I would say, "Read this and consider perhaps this is a company you can be so proud of that you will follow in your dad's footsteps." Thank you very much for hearing my report today. Before I turn it over to Ben, our Chief Executive Officer, I want to, Ben, publicly thank you for your leadership. It's been admiring to see the strength you've had through these challenging times, taking tough decisions. As I believe the history book will be written on Shell, they're going to look back at those tough decisions and say, "These are some of the brightest times our company's ever had." It's been an absolute joy working with you, Ben. I wish you the very best in the years to come. The floor is yours, Ben. Well, thanks very much, Chad Holliday. I think you have served for 10 years on this board. You've shown not just commitment to this company, passion in this company, but absolute love for this company as well. I think it showed in the speech that you just gave. I think the progress that we made under your leadership, six years as chair of this board, has been tremendous and would not have been possible had it not been for your empowering leadership, for your encouragement, for your optimism, for your curiosity, by instilling the best in the people of Shell and being such a fantastic coach to me and such a good friend with which I could discuss everything. I also thank you for your amazing contribution and may our friendship last for many more years to come. It's not yet the end of the road. We still have an AGM ahead of us, so let's turn to the business of the day, and we'll say our goodbyes a little bit later. Ladies and gentlemen, thank you very much for joining us today at our AGM, and I'm really glad that technology means that we can all be together again today. I just want to say really one thing, and that one thing is that I'm truly excited for the future of your company. Today, I can tell you about the direction we have set, some first steps that we have taken, the strategy that will guide us in the years to come. The future, the future is all about the progress we make, the projects we undertake, the targets we hit. That is why I am excited about it, and why I think you should be excited too. Our eyes are on that future for Shell, and we are already making confident strides toward it. Now, of course, even as we do so, safety remains our first priority. That is why I am so pleased that 2020 was Shell's safest year ever. Today, it has been 658 days since anyone died during our operations. We also achieved the strongest ever process safety performance at Shell operated ventures last year. Hard-earned achievements. However, they can be easily undone, and we must always look for further improvement. That is why we are now using a new approach on safety. This has a more complete focus on the way people, culture, equipment, work systems, and processes all interact. This means a close look at how we expect where work will be carried out, but also what happens in reality, because people make mistakes and processes fail. Our new approach is designed to accept that mistakes will happen and allow us still to operate safely. Part of this is creating a psychologically safe environment in which staff can speak up. Another part is building a learner mindset, which allows us to do even better with the lessons that we take from both our successes, but also our failures. There will be failures, and we will be tested, so our vigilance must and will remain. It is through being tested that we know ourselves, through being tested that we can hope to improve. This is not just true of HSE performance. Without testing it, you cannot truly know the resilience of anything, from the strength of steel to a person's courage. In the same way, without testing, you cannot know the core of a company. Make no mistake, we were tested in 2020. Shell stood up to it. Shell was and is strong, solid, and secure. I don't need to remind you of the challenges of 2020. Yet 2020 was still a year of delivery from Shell, not just on safety performance, but in our operations and in our financial results, too. 2020 showed us that Shell has a resilient portfolio. It has steadfast people and a depth of capability that saw us through the worst of times. Now, we also made tough decisions where we had to, so spending, write-downs, and on the dividend. Despite everything that the year threw at us and a headline loss of $21.7 billion, our cash flow from operations continued to lead the industry, standing at $34 billion US. Our adjusted earnings were almost $5 billion. we not only delivered on cost reduction targets for the year, we exceeded them. our performance on organic free cash flow was excellent at around $18 billion. That was actually close to 2019 levels. we reduced net debt by almost $4 billion. Against the odds, we came out of 2020 with a stronger balance sheet. We came through it. We were and we are resilient. today, as you know, there are promising signs towards the future. Our first quarter results represent the first page of a new chapter for Shell. We generated $8 billion of cash in the quarter. We increased the dividend per share by around 4%, in line with our progressive dividend policy, and we reduced net debt in the first quarter alone by more than $4 billion, pushing towards the $65 billion milestone at which we have said we will further increase shareholder distributions. Shell, your company, has been tested. We have been tested, so we know we are strong, and that strength is on show for all to see. The work to make Shell even stronger is well underway. In February, we set out our Powering Progress strategy for you, and we explained its four goals, generating shareholder value, achieving net zero emissions, powering lives, and respecting nature. We outlined our approach on capital and on carbon, and we detailed how all of that fits with our three business pillars of growth, transition, and upstream. In essence, Powering Progress is a strategy to accelerate the transition of your company and to do so with purpose and with profit. It is how we build a yet stronger, yet more resilient company by putting customers at the center of everything we do as our customers and we move together into a low-carbon future. Overall, Powering Progress captures Shell's role in society, what we do, what we should continue to do, and ultimately the case for Shell as an investment. The four goals of Powering Progress are all critical to Shell's future, and they are founded upon our core values of honesty, integrity, and respect for people. They are secured through our determination and a focus on safety and our commitment to doing business in a transparent way. Together, the four goals weave sustainability and our purpose throughout our business strategy. There's a huge amount happening in Shell right now towards our Powering Progress goals, and I will briefly highlight three things. First, to embellish strategy throughout Shell, we are currently in the process of reshaping your company. When our reorganizations appear in the media, it is often in the context of job cuts. Indeed, reducing costs is an important part of it. We have to be competitive. It is about much more than that. It's also about putting Shell into a structure which matches our strategy, that allows us to be bold in driving forward the change that must happen, and that makes us a more customer-focused organization than we have ever been before. All of this will help maximize the advantages we already have, from our ability to innovate and bring new products to market, to our trading optimization capabilities, to our global reach, our leading brand. In a very different way, you can see the influence of our Powering Progress strategy in the stance we have taken in Nigeria, which we outlined at our ESG update last month. Of course, as you all know, in Nigeria, we have faced a consistent environmental challenge, mainly because of leaks caused by sabotage and theft in areas where security is a serious problem. We have been reviewing positions that continue to be challenged from an environmental perspective, and a particular point of attention has been onshore oil in Nigeria. Over the last 10 years, we have reduced the total number of licenses in onshore Nigeria by half. Unfortunately, our remaining onshore operations continue to be subject to sabotage and theft. Despite our best efforts to limit and respond to this illegal activity, it means that the balance of risks and rewards associated with our onshore oil portfolio in Nigeria is no longer compatible with our strategic ambitions. Because of this, we have started discussions with the Nigerian government to align on a way to move forward. Even so, Nigeria continues to be an important heartland for Shell. Our intent is to focus our investment on our deep water and our gas positions. Now, the third thing I want to highlight is our publication of the Shell Energy Transition Strategy, which is at the core of Resolution 20, and which I encourage you to support. This publication also springs from Powering Progress, because Powering Progress is ultimately about transforming Shell, and the Shell Energy Transition Strategy gives you details about how we plan to do that. It's not just our last word on how we aim to get there. Our strategy will evolve, and it will grow over time, but we are talking about a long-term transformation. It's only right that you, as our shareholders, have our detailed strategy for that transformation set down in writing. It's only right that you, our shareholders, have the chance to vote on that. The scale of the transformation involved means it is more important than ever for our shareholders to understand and we hope also support our approach. Why should you give that support? Well, let me give you three reasons for it. One, the Shell Energy Transition Strategy is comprehensive. Two, it is rigorous, and three, it is ambitious. Our target is to be a net-zero emissions energy business by 2050 and step with society's progress towards Paris. It's a comprehensive target that includes all the emissions from all our energy products. This means net zero emissions from our operations. That's our Scope 1 and two emissions, and also net zero from the end use of all the energy products that we sell. That's our Scope 3 emissions. Including Scope 3 is critical because these emissions created by the end use of our energy product, they account for over 90% of our total emissions. We are also comprehensive in how we define Scope 3. Of course, we could limit the definition to the oil and gas we produce ourselves. We believe that definition is just too narrow, so we do not use it. We sell far more energy than we produce ourselves, almost four times as much. When we talk about Scope 3, we mean all the emissions from the energy that we produce ourselves and also all the emissions from the oil and gas that others produce, which we then sell to our customers in our energy products. Finally, we are comprehensive because when we say net zero, we mean net zero. We measure our progress towards our target by using a carbon intensity metric. It is critical to note that achieving net zero on carbon intensity is exactly the same as achieving net zero on absolute emissions. As I said at Strategy Day, we believe our absolute emissions across Scopes 1, 2, and 3 reached a high point in 2018 at 1.7 gigatons, and now we are working to bring them down. That's what I mean when I say the Shell Energy Transition Strategy is comprehensive. It's also rigorous. We have carbon intensity targets for the short, for the medium, and the long term, and we believe these targets are aligned with the 1.5 degree Celsius scenarios used in the IPCC Special Report on Global Warming. We have set out on page nine of the Shell Energy Transition Strategy why we believe this is the case. We're also transparent about the accounting methods that we are using. We measure our carbon intensity using an approach that we developed ourselves. We call it our net carbon footprint methodology, and the details of how it is calculated are available on our website. Our Shell Energy Transition Strategy is both comprehensive and rigorous, but it's also ambitious. Achieving our target would mean massive change for Shell, far more than we have already achieved. I've called it a transformation, and it would be exactly that. There is a chart on page 15 of the Shell Energy Transition Strategy report, which gives you an idea of the change that would be in store for the business over nine years. Let me highlight a few points. Oil production fallen by 1%-2% a year, methane emission intensity at below 0.2%, no new frontier exploration entries after 2025, producing eight times more low-carbon fuels than today, storing away up to 25 million tons of carbon dioxide each year through CCS, with another 120 million tons mitigated each year through independently verified nature-based projects, selling double the amount of electricity compared to today, delivering the equivalent of more than 50 million households with renewable power, operating around two and a half million electric vehicle charge points. That's a lot of change in nine years. That's rapid change, and it would be only the beginning if we are to achieve our net zero target. Indeed, after 2030, Shell will be looking to accelerate even more. Now, ultimately, achieving that level of change means changing demand. Because it is demand for energy that is key, not restricting supply, which could then just come from elsewhere. Changing demand is a huge and complex task, a task that will take many years, and one that is well beyond any one company, any one industry, or even any one country. It must be done. Shell's ambition extends to doing everything we can to help get it done. We will work with others. We will work sector by sector to find and agree and implement decarbonization pathways for these hard-to-abate areas of the economy. We have already started our work on that. The Shell Energy Transition Strategy, comprehensive, rigorous, and ambitious. It is our strategy for success. It is an agenda for the transformation of Shell. It is the setting of our compass towards a bright future with Shell as a critical part of a net-zero emissions world. Your company stands as the first of its peers to put an energy transition strategy up for a shareholder advisory vote. Our decision to do so was a crucial step in making ourselves transparent to you, our shareholders. I ask you to vote for it, to vote for Resolution 20, because it is a vote for the future of your company, a future that I'm excited about, and a future I believe you should be excited about, too. Next year, when we meet again for the AGM, I hope you will be excited to hear more of all the steps that we have taken towards that bright future that is ours for the taking. Thank you. Ben, thank you very much. Fellow shareholders, I think you can understand why the people of Shell are excited about what we're doing going forward based on the presentation Ben just gave you. We now come to that part of the meeting where you have the opportunity to ask questions or make comments. You may have seen the notice of meeting that most of the resolutions are of a mainly routine nature for a listed PLC, with the exception of the two climate-related resolutions. The first of these is Resolution 20, which is proposed by the board and presents an advisory vote on Shell's energy transition strategy. The strategy follows detailed conversations with shareholders and describes Shell's energy transition strategy, including our emissions targets. We consider this publication and the strategy it summarizes to be aligned with the more ambitious goal of the Paris Agreement to limit the increase in average global temperature to 1.5 degrees Celsius above pre-industrial levels. We hope it provides a pathway for deeper and more specific dialogue on that alignment. Shell is the first energy company to submit its energy transition strategy to shareholders for an advisory vote. We will publish an update every three years until 2050, and every year starting in 2022, we'll also seek an advisory vote on our progress toward our plans and targets. The board and management also believe it's important for all shareholders to have a vehicle to express their views on whether our strategy is reasonable in the current environment. The advisory resolution is designed to make that a vehicle. For clarity, it does not shield or advocate the board or management's legal obligation under the U.K.'s Companies Act, nor does it ask shareholders to take responsibility for formally approving or objecting to Shell's energy transition strategy. The legal responsibility lies with the board and the executive committee. The other climate-related resolution is Resolution 21. It is a special resolution which has been requested by a group of shareholders represented by the organization Follow This. Your board believes that Shell's more comprehensive strategy and actions to support society in meeting the goals of the Paris Agreement, which have been summarized in the Shell Energy Transition Strategy, make this resolution redundant and recommend shareholders vote against it. We'll shortly hear from Mr. Van Baal, who will tell you more about his resolution. To ensure orderly discussion, I will take questions in this order. For all questions or comments of a general or operational nature, including those about the climate change or the energy transition, and all questions or comments about our strategy, including those about Resolution 20 and our energy transition strategy, we will take first. We will then take the questions in order of remaining resolutions. I could remind you to keep them to the point and short, preferably no longer than one to two minutes, please, so we can get through as many as possible here today. For those asking questions via the teleconference facility, I would also ask you to give your name, and if you represent an organization, the name of the organization when asking a question or making a comment. Now let's move to our question and answers, and we'll deal with the first question, please. Operator, my name is Gerard Kleisterlee. I'm the EVP Finance for Investor Relations. I would like to now start to do the Q&A. We'll start first with the Q&A on the phone. Operator, can you call for questions? Thank you. We will now begin the Q&A. We can now take our first question from Mark van Baal. Okay, go ahead. Thank you. We will now begin the Q&A. To ask a question, you need to be dialed in via the phone line. Please press star one to be added to queue. Mr. van Baal, go ahead with your question or comment. Yes, good morning to everybody. Thank you for this opportunity to speak with you again, chairman, directors, shareholders, Mr. van Beurden, and a special welcome to the incoming chair, Andrew Mackenzie. Mr. Mackenzie, congratulations on your appointment. Now that you are the chair of one of the world's largest oil majors, you are in a unique position. Together with Ben van Beurden, you are one of the few people who can make or break the Paris Agreement. The decisions you will make in your tenure will define how Shell and the world will look like in a few decades from now. By that time, your grandchildren will realize what positions their grandfathers held and will surely ask, "What did you do about the climate crisis?" Today, the fifth Follow This resolution, climate resolution, will come to a vote for the fifth time. For the fifth time, your board advises shareholders to vote against the climate resolutions. Let's make no mistake. If Shell's targets were Paris consistent, you shouldn't need to advise your shareholders to vote against Paris consistent targets. This is the only thing we ask in our resolution. This is the only thing we want shareholders to support you in. We had today, the International Energy Agency published a report where they said New oil and gas projects will be impossible to reach net zero. The International Energy Agency basically says to the oil industry, "Please stop investing in new oil and gas projects, otherwise we will never meet the Paris Climate Agreement." Therefore, we trust that shareholders, responsible shareholders, will vote for these climate targets to compel Shell to advance its climate ambitions to Paris consistent targets. To offer shareholders transparency and clarity about your climate ambition, about your climate plans, we have two crucial questions. The first one is, what reduction of net absolute emissions will Shell achieve by 2030? The second question is, what percentage of Shell investments will be in renewables, and what percentage will be in fossil fuels in the years 2022 and 2023? Let me finalize. Mr. van Beurden, Mr. Mackenzie, your shareholders and future generations count on you to take bold and brave decisions now. I'd like to conclude with how I conclude it every year and in our resolution. You have our support. Mr. Van Baal, we appreciate your comments. I'd like now to ask Ben to respond to that. Ben, my suggestion would be not just respond to the two questions, but he made a number of insinuations about our plan. If you could speak to that very comprehensively, I'd appreciate it. Yeah, thank you very much, Mr. Van Baal. I can hear a bit of an echo here, so maybe the audio team can help. Thank you very much, Mr. Van Baal, and I will indeed keep your last comment in mind when you say that we have your support. On your resolution, you asked for a number of things in here, and let me explain why we vote or recommend vote against it. First of all, in your resolution, you ask for us to set and publish targets. We've done that. You then say, can these targets please be consistent with Paris? We think they are, and we explain in great detail why we believe they are consistent with Paris. Then you say there should be long, but also short and medium-term targets. Well, we have targets for this year, next year, the year after, 2030, 2035, and 2050. I believe we've covered that one as well. You say they should cover scope one, two, and three. Well, they do. As a matter of fact, I explained what we even mean by scope three. That's comprehensiveness. You say you should report on that strategy. Well, that's resolution that we bring out, Resolution 20. You also say in your supporting comments that we can allow flexibility. We may use whatever target we think is appropriate, also an intensity target. That's indeed what we did. I'm happy to explain also that. There's nothing in your resolution that we haven't taken into account and haven't responded to. That's why we say the resolution is redundant. It is more important that shareholders also show their support for a much more detailed plan than the ones that you advocate. </edited_transcript Now, there's a few other things that you say, not in your resolution, but of course, you are in the press all the time saying that we have not set short-term and medium-term targets. Now, Mr. van Baal, we both know that's untrue. I just mentioned the targets that we have set. You say there's nothing concrete in the plans. Well, I just made a very long list of the things that we intend to do over the next nine years. On page 15 of our report, there's a long list of very concrete things that we are working on and delivering. You say the intensity metric is really a problem. Well, you suggested it yourself. I think it isn't a problem. It is actually the only sensible way to measure whether a company is transforming and substituting high carbon for low carbon energy. You also make an assertion that we will actually grow our absolute emissions, which is also untrue. I think your last comment that this is just a piece of evasive action is really incorrect. To be perfectly honest, the people in Shell take issue with that assertion as well. I think this is a comprehensive report, it is a serious report, it is rigorous, and it is very ambitious for all the reasons that I just mentioned. I hope you will read it, and in it, you will find many answers to the questions that you ask. For instance, the change in the capital profile. We will, of course, change the capital profile of the company over time. We also explain in the report that measuring where we invest is not a proxy to progress. If you want to measure progress, you have to look at the carbon intensity of the products that we sell. We do indeed believe that over time, the investments will change away from our upstream business to our growth businesses. If you look at page 21 of the report, we detail exactly how that shift will happen from 2020 in the period beyond 2025. You will see more than a doubling of the investment percentage-wise in our growth businesses and roughly a halving in our upstream businesses. Again, they are not the right metrics to judge us on. We haven't set an absolute emissions target for 2030. We just set 1.7 gigatons. That's what the total footprint of our company, including our customers, was in 2018. It's 1.7 that will actually come down going forward. Exactly how it will come down is a combination of all sorts of factors. To just look at absolute emissions, I think would also not tell the whole story. Reducing absolute emissions at this point in time is predominantly possible by shrinking the business. If we want to really make change in the global energy system, we have to substitute the high carbon energy that we are selling for low carbon energy. For that, unfortunately, also our customers need to substitute the appliances in which they use energy, and that is what we are going to do together. Now, I'm sure our targets will evolve over time. We will give you progress reports every year, and in three years' time, I'm sure there will be a further update to the strategy that we have set out, which will be reflective of the progress that society has made and the progress that we have made in driving that change. Thank you very much for your support, Mr. van Baal. Thank you, Ben. Next question. Operator, next question on the phone please. Second question comes from Adam Matthews. Hello. Thank you very much, Mr. Chairman, for calling me. My name is Adam Matthews, representing the Church of England Pensions Board that has co-led Climate Action 100 engagement with Royal Dutch Shell together with Sylvia van Waveren of Robeco. Climate Action 100+ is the third year of a five-year engagement that concludes in 2023. What message is being sent today to the board of the company from investors? Speaking on behalf of the pensions board, on one level, there is a recognition that Shell has taken another important step in setting out its energy transition strategy, the first in the oil and gas sector to do so and to put it to an advisory vote. It shows that Shell is accountable for delivering a genuine 2050 net zero target in both absolute and intensity terms. That this step builds upon previous announcements accepting targets covering Scope 1, 2, and crucially, Scope 3 emissions. That all activities are covered by Shell's targets. That Shell will work with its customers and in time will stop selling energy to customers that do not have commitments to be net zero themselves. That Shell will leave industry associations that are lobbying in a manner unaligned with the Paris Agreement. However, there is a clear message that whilst these steps have often been industry-leading steps, there are many companies in the sector that lag Shell. We have to be clear that the assessment of the Climate Action 100 benchmark highlights the gap from where Shell is today and where Shell needs to be by 2023 if it is to carry the confidence in future years of its shareholders. Specifically that in addition to intensity targets, that short and medium-term targets need to be expressed in absolute terms as you have done for 2050. Further disclosure is needed on capital expenditure alignment. Industry association membership needs to be consistent with achieving your strategy, not just about governance of unaligned lobbying. The proposed role of the strategy of offsets and CCUS is shown to be credible in practice, not just in theory, and that the strategy is kept under review for alignment with the new International Energy Agency 1.5 Degree Scenario that was released today. As a pensions board, we have today supported the energy transition strategy, not because we believe it's perfect, but the first phase of Shell's transition over this crucial, complex decade. We do so knowing and expecting it will change significantly as the company adjusts to what works and what needs to change. As a fund, we welcome today's vote. All carbon-intensive companies should put their climate strategies before their shareholders. We're also clear that unless there is full alignment by the conclusion of the first phase of Climate Action 100 in 2023, and in accordance with the commitments we have made to our own pension fund members, we will disinvest our holding in Shell as we have already done in other carbon-intensive companies. We believe engagement with Shell to date has delivered tangible progress from the response of the company, but still needs to go further. Mr. Chairman, today on this vote, you have our support to go further and faster in transitioning Shell. We know you're at the start of reshaping the company, but we need to continue to engage intensely to address the areas we have outlined. As a fund, we're committed to do so in advance of our 2023 deadline. Thank you very much. Thank you, Mr. Matthews. Let me respond, and I'll ask Ben to add any additional comments he has. This type of dialogue that you've just demonstrated is exactly what we're looking for. You told us what you like about our plan, and you talked to areas that you think we could make it more robust. That is exactly what we visioned by putting this strategy up for a vote, that we would start that dialogue, and then we would have the report every year on how we're doing and the update of the plan in three years. I commend you for starting this dialogue, and we look forward to working with you on it. Ben, anything else to add? Well, just to say, Mr. Chairman, that indeed, Mr. Matthews, it has been a real pleasure working with yourself and with Sylvia van Waveren and the whole of Climate Action 100+. It's fair to say we have tremendously benefited from the insights that you have provided, the challenge that you have given, and I would also like to think that between the two of us, we are in the process of advancing the debate from what is quite often maybe a little bit uninformed and simplistic to a real dialogue that we are now having. There is no doubt in my mind that our plans will have to evolve, and they will evolve, and I hope they will evolve as a result of a continuing productive dialogue that we have had. As you will note, we take the benchmark of Climate Action 100+ very serious. As a matter of fact, the way we have laid out our report is exactly as per that benchmark. You will see that in some areas, we are not perfect yet, and we know that we have work to do. In other areas, we seem to have a different view on how to, for instance, best measure progress. I am sure that as we continue the dialogue, we will get to a better and aligned way of driving progress, not just at Shell, but hopefully in society. Next question. Mr. Chair, I will read a few questions now online, and then we'll go back to the phone. I'll now go for the first two questions from Mr. John Steven Betty. His first question is, at the last AGM in London, when audiences could attend, I noticed that all those on stage were either Dutch or American. I noticed that a few years ago, Shell, SRPM and SIPC bought out Shell America, i.e., a structural change, and also that a few years ago, after a bit of a scandal concerning declarations of company assets, a result of EP filing inflated figures, I believe, that whole arrangement of Royal Dutch and Shell U.K. operating somewhat independently was streamlined between brackets. Does this mean that now Shell is predominantly a Dutch U.S. company and the British influence and control is diminished? How much were these decisions influenced by shareholder geographic locations, economic considerations, and geopolitical considerations? How does the company now consider these decisions in the light of the rise of China and the stance of being taken by America? This is his first question. He also has a second question, Mr. Chair. How does Shell see the problems of safety issues impinging on the market for hydrogen's use of both static and mobile equipment? Let me pause there. Thank you very much for your questions. Jessica, could you please address the first question and maybe put it in context for our shareholders who might not be familiar with some of the terms? Ben, could you take the second question on hydrogen safety? Jessica. Thank you, Chair, and thank you, Mr. Betty, for your question. Royal Dutch Shell PLC is a U.K. company. It was born out of the unification that happened in 2005 between Royal Dutch and Shell Transport. Previously, it was a somewhat unusual structure. It was a joint venture between two independent entities. To streamline and modernize corporate governance, the unification happened. We are a U.K. company headquartered in the Netherlands. What I would also say is that from a management perspective, we run the company from a global perspective, so we have global lines of business. Our Dutch U.K. heritage, of course, has shaped and informed the company that we are today and continues to be very relevant. Ultimately, we are a global company with leadership and employees around the globe in the seven or so companies where we operate. Thank you. Thank you, Mr. Bettai, and your question on hydrogen. It is indeed a very important question. It's not a new product, of course. We actually use hydrogen quite a bit already in our refining processes, in our chemical processes, and it is being used in other technologies around the world as well. Of course, if we are to roll out hydrogen as a much more, shall we say, commoditized product for, say, for instance, mobility or heating in homes or energy storage, for instance, we will, of course, have to pay tremendous attention to the safety standards surrounding it. That's not just Shell. That is, I think, everybody, from appliance manufacturers and vendors to indeed industrial processors. There is a lot of technology knowledge already. Shell actually started its hydrogen business in the '90s. We thought at the time that hydrogen was about to take off. We were probably 25 years too early, but that is often, of course, the story of our company. We now think that indeed that moment is there again, and this time it's real. In the 25 years, we've also had a tremendous amount of experience and understanding. How would you charge a car with hydrogen? How would you reticulate hydrogen into networks? What sort of other safety standards would surround hydrogen? Particularly also if you have to liquefy hydrogen, for instance, if you were to transport it around the globe. We think that that is also part of the future system for hydrogen, where renewable electricity converted to hydrogen, transported in a liquid form to other places in the world, is going to be potentially an important part of the energy system. It would be too much to explain to you exactly how we are going to do this and how the industry is doing this. Let me reassure you that safety standards surrounding hydrogen are of the utmost importance and have our total attention as we figure out our strategy for the product. Thank you very much for your question. Next question. I'll do two more questions online, and then we'll go back to the phone. I have a question here from a Dutch shareholder, Mrs. Wensing. What does the board think is more likely for it to ever support the Follow This proposal or to be dismantled by society? Thank you very much for your question. What we are proposing with Resolution 20 is the start of a dialogue. We believe that dialogue should be with people that agree with us and don't agree with us. On the points where Follow This or any other organization disagrees, we want to listen. We want to understand. We want to help them understand our plans better. Perhaps we're saying the same thing and just somehow aren't communicating. What we can commit to you and what your board's committed to you is not just one dialogue session. We're talking about dialogue every year. We're talking about submitting this progress report for your approval and then update the plan in three years. I think that this should be the right way to go forward. What was the next question? Mr. Chair, I have the next question from Anthony Charles Philip Allwright. Why is Shell not robustly defending the virtue of fossil fuels in enabling for the past 150 years and into the future human health, prosperity, and happiness to an extent never before seen in history? To date, no source other than nuclear is able to provide at scale the affordable, abundant, reliable, storable, transportable energy that fossil fuels provide. Moreover, fossil fuels-derived CO2 is a net good to the atmosphere as it is a wonderful plant food that over the last 40 years has regreened the planet by 30%, according to NASA satellite imagery. Please stop apologizing for Shell's primary product. We appreciate your point of view. Let me make a couple comments and see if Ben would like to add. Your board has taken extraordinary efforts to make sure we understand the science. We've had climate scientists come and meet with us and talk to us about it, and so we could ask questions, understand the trends, make sure we know the latest research. We think we're highly informed with the technical details that we need to set our strategy forward. What we're proposing to you today takes that fully into account. Ben, any additions? Thank you very much, Mr. Allwright, for the comments that you make. I agree with many aspects of it, particularly, of course, the fact that hydrocarbons, oil, and gas have been such an incredibly important component to modern life as we know it. Quite often, of course, not fully appreciated because we take energy for granted. It is just always there as a background thing on demand. Again, of course, our industry, the energy industry, has been under tremendous evolution ever since it started. We have evolved from being one form to another form to yet another form over the last hundred-plus years. I think we should continue to embrace that evolution. I think the last evolutionary trend to just see whether we can actually reduce the greenhouse gas emissions from energy demand and energy use are important trends to embrace and to do something about. In some areas, indeed, it will be much more difficult to do. We talked about the hard-to-abate sectors like aviation, deep sea shipping, some industrial processes, where actually most of the emissions actually come from. They will not be trivial to undertake. They will need a tremendous amount of collaboration between industry, government, and society. That's why we need to focus on it. Because if we don't focus on it, we have learned, we will not make too much progress. That is why we have a 32-page report that sets out how we are going to make that transition and what our role in that transition should be. Not that we are not proud of the progress that our industry has brought to society, but we're also proud of the changes that our industry bring to the benefit of the planet. Next question. Operator, next question please on the phone. Next question comes from Michiel van Esch. Please go ahead. Thank you. My name is Michiel van Esch. I work for Robeco. Today I also speak on behalf of a group of institutional investors, including Robeco, APG, BMO Global Asset Management, PGGM, NN IP, AM, and Van Lanschot Kempen. First of all, I would like to thank management and the board for their ongoing discussions with us on a variety of topics, including strategy, remuneration, and climate change. We specifically would like to thank Chairman of the Board, Mr. Holliday, for his open conversations with us over the last couple of years. We also would like to wish Mr. Mackenzie the best of luck as his successor. We look forward to continuing our constructive dialogue in the future. Over the last couple of years, I have attended Shell's AGM with the same basic message, that Shell has an important role to play in mitigating climate change, and that it is of the utmost importance that the company is clear on how it aims to achieve its energy transition targets in the long run by showing plans, actions, targets, and progress in the short run. The Energy Transition Report aims to do that, we believe that the company has shown leadership by being one of the first companies in the sector with a say on climate vote. The report allows us to better understand the steps the company is taking throughout its transition. We expect that the recurring shareholder vote is an effective way for shareholders to monitor progress and to have a more content-oriented discussion on progress. We appreciate that this is a step, a next step in terms of accountability towards shareholders. Still, most of the plans require significant action in the coming years. In that context, I have a couple of questions and comments. In recent weeks, there has been discussion around the auditor's observation that Shell's operating plan and pricing assumptions do not yet reflect the 2050 net-zero emissions targets as Shell has put it forward. We do understand that the audit procedures are primarily backward-looking and that Shell's target is forward-looking. Yet, for us, verification of progress is an important component of the credibility of climate targets. I have two questions related to this. First, what actions will Shell undertake in the coming years to achieve the verification that plans are aligned with its climate targets, in first instance, the 2030 target? What mandate has Shell given its auditor in relation to verification of its operating plan and price assumptions in relation to its climate transition strategy and targets? We would also welcome the auditor to explain what regard to his observation, if possible, during this AGM. My next question relates to an updated target by the EU to cut emissions by 2030, with 55% compared to 1990 absolute levels. We also see recent appetite for enhanced targets in other nations. Shell's plans specify an intermediary target of 20% carbon intensity reduction by 2030. As Shell has repeatedly mentioned to align its progress with society, does management see a need already to further increase its targets in the intermediate term? Can you also explain, we understand that there's no target, but what you expect to be your absolute emissions by 2030 if you meet your current intensity targets? We appreciate that Shell has shown leadership in the sector by asking shareholders' advice and for providing further detail to its climate strategy. It is understandable that Shell's strategy will require updating and changes throughout the years to address changes in expectations, demand, and regulation. It is critical to get things done in the short term. A challenge in monitoring progress for Shell's plan is that a 20% intensity reduction target applies for 2030, but 80% of reductions still need to happen between 2030 and 2050. In coming reports, we expect Shell to explain what it has already achieved in progress with their energy transition strategy, but also to be concrete on what still needs to happen. As shareholders, we need a realistic and concrete projection of how net zero can be achieved. We expect Shell to continue to make further progress in the next years, and we are looking forward to those coming reports. I will come to my final question, which relates to Shell's operations in Nigeria and recent court filings. Can Shell guarantee shareholders, also in line with recent court rulings on Shell's duty of care, that it will do all that is necessary to ensure a satisfactory conclusion for all stakeholders in relation to its activities in Nigeria, so that the company will not be haunted by the situation in the Niger Delta for years to come? Also, can you elaborate on the lessons learned in that regard, and how these lessons will be used to further promote and respect rights of local communities across all operations? Those were my questions. Thank you. Thank you very much for your very clear, extensive list of questions. There's three basic questions. I'm going to, in just a minute, ask Allister Wilson, our external auditor, to comment on his letter, which I think maybe all shareholders might not be familiar with it. I would ask Allister to update us on what they were saying in his letter about verification and what shareholders should take from that. I'd like to turn to Ben to deal with the other questions on climate that are raised. On Nigeria, Donnie, our general counsel, I'll call on you next to update the shareholders on any ongoing litigation that you think relates to the question at hand. Ben, if you could follow up with that with the steps we're taking in Nigeria, which you included quite a bit in your speech, but to add to that. If we could go to Allister first to give comments about your report. Thank you, Mr. Chairman, and thank you for the question. Throughout our audit opinion, we have provided considerable transparency into how our audit is impacted by climate change and the energy transition. For example, in areas such as refining margin and the estimation of the recovery amounts of refineries, the impairment of upstream assets and integrated gas assets, decommissioning and restoration provisions, deferred tax assets, and so on. We've provided considerable insight into how we took climate change and energy, climate risk and the energy transition into account in auditing those amounts in the financial statements. You'll have also seen in our audit opinion that we reported to the audit committee that we did not see any evidence that Shell's balance sheet either overstated assets or understated liabilities. That's taking into account energy, climate risk, and the energy transition. There's a very big difference between pursuing an energy transition strategy that is aligned with the Paris goals, as Ben has set out. That's very different to Paris-aligned accounts. What has been referred to is our statement in the accounts that Shell has reported in Note to the Consolidated Financial Statements that their operating plan and pricing assumptions do not yet reflect Shell's 2050 net zero emissions target. We're just reporting what Shell has also reported in Note to the Financial Statements. It's for that reason why we have set out the reasons why it would not be appropriate for us to attempt to second-guess management and to set out, in our opinion, what assumptions management would have made were the accounts to have been Paris-aligned. That's the reason. It's neither, in our view, responsible or appropriate within our professional remit to do so, and that's why we haven't done so. It's also why we've provided considerable insight, in my view, into how our audits and the key judgments and estimates in Shell's accounts, we've taken account of climate change, climate risk, and the energy transition. Thank you, Astrid. Ben? Yeah. Thank you very much, Mr. van Esch, for your question. I think it's a very important question, and I'm sure there will be a few more clarifications required between on intensity targets versus absolute targets. Let me just, if you don't mind, make a few statements about what is the difference between the two and why we have chosen the intensity metric. First of all, think of it, if as a society, we have to get to net-zero, there's only a few things that we can do. We can, of course, make the economy more energy efficient and reduce the energy need to bring economic prosperity, and therefore indeed make the problem smaller, so to speak. The second action would be to have whatever energy we still use to power our lives and our economy, to have that energy as low carbon as possible. Reduce the carbon intensity of the energy mix. The third measure, which we think is needed, and don't take my word for it, but probably every reasonable climate scientist as well, we will have to offset whatever emissions are still there, either by carbon capture and storage or using nature as a tool to offset. These are the three things that society needs to do, reduce energy demand, make energy less carbon intensive, and deal with whatever emissions are still remaining. We think as a company, we cannot achieve number 1. We cannot just say, let us reduce energy demand in society. That is not within our remit. What we can do is to say, let's provide energy with a lower carbon intensity. Let's also deal with the third one, which is to mitigate emissions that may still be there. That's why we use energy intensity as a metric. Let me explain it in another way, and apologies for taking a little bit of time, but I think this is a really important issue for all our shareholders. At this point in time, if we had to indeed shrink the footprint of the company, the only sensible way you can do this fast is to just retreat from the business. Would that help society? No, because of course, the demand wouldn't go away. If you wouldn't supply it, somebody else would. Retreating is not exactly a solution for society. It would help us if we had set an absolute target, but it wouldn't necessarily help society, nor do we believe would it help our shareholders. What else can we do then? We can dilute our energy mix. We can just say, well, in addition to selling petrol and diesel and jet fuel and everything else, let's also sell renewable power. Let's also sell biofuels. Let's also sell clean hydrogen. We can do that. In doing so, we will reduce the carbon intensity of the total mix. That's what we are doing at the moment. Is that enough? No, it's also not enough. In the end, we will have to substitute. We will have to substitute high carbon-based energy for low carbon-based energy. The challenge with that is that also that we can't do alone because it takes two to tango for substitution. If we are to sell more electricity to cars rather than petrol to cars, we have to have different cars showing up. If we have to change the use of energy in industry from, say, oil and gas to hydrogen, you probably need different industrial processes. You may need different trucks to fill them up with hydrogen rather than petrol or diesel, et cetera. The substitution process that we are trying to achieve to accelerate by the sector-by-sector approach is actually still in its infancy. That's sad and difficult to hear, but it's also true. Look at the amount of electric vehicles on the road. It's growing tremendously, but as a percentage of the total fleet, it is still a fraction of a percent. We need to accelerate it. That's why we are calling also for internal combustion engine bans. We need to accelerate the change from petroleum-based kerosene to sustainable aviation fuels. The same is true for shipping and for other areas. We think it will take at least a decade for that to become such a material movement that we can see that it overtakes the dilution and the retreat part of our strategy. How fast it will go, I don't know. That's why we actually say in line with society. Where we will be at 2030 would indeed be a guess. I'm not going to hazard a guess. The only thing I'm going to say is we're going to work very hard to make it happen. In the meantime, though, we have set pretty hard targets for what it is that we want to achieve. The short-term targets, the ones for this year, next year, and the year after, are actually linked to the remuneration of 16,500 people in Shell. Now, we will update you every year on how we see not only our progress, but also how we see progress within society. I hope we can demonstrate that as a matter of fact, we are not only pushing society, but we're probably going to go a bit faster than society as well. Thank you very much for your question and apologies for explaining it extensively, but I believe it is one of the key points that needs to be clarified around our approach. Thank you. Thank you for taking time to explain completely because it was very important. Donnie, if you could update us on the major litigation in Nigeria that our shareholders could be focused on. Thank you very much for the question. Indeed, I think Nigeria is a challenging environment to operate in, and there is a lot of litigation there. In actual truth, actually, we win the vast majority of the cases that are brought against us. Last year, for example, out of the cases that were brought against us, we only paid out about $5.2 million in Nigeria. I think, a lot of the cases in Nigeria, the claims themselves are quite inflated. Actually, at the end of 2020, we had only provisions of about $150 million in the account for what represents hundreds of billions of dollars of claims. I think more importantly, I think is perhaps a reference to the litigation in Nigeria are the two cases that we've had recently, one in the Netherlands and one in the UK. We're disappointed by the decisions. They relate to spills, and we are still very convinced that actually the spills occurred as a result of sabotage. The case in the U.K. is now having to go back to the lower courts, so no liability has been found. It's too early to speculate what the quantum is there in terms of exposure. Going back to the case in the Netherlands, we are also appealing the case at the moment because we were required to install a leak detection system, and we're trying to clarify what is the specific requirements there. Again, no liability has been found in terms of quantum. Again, I think one of the things that the SPDC staff do extremely well is that they remediate all spills, regardless of whether it was caused by operations or by sabotage or theft. I think they're doing such a great job there, and I hope that actually the litigation will indeed reflect the work that they do as well. Thank you, Donny. Ben, anything else to add on future plans? Yeah. Thank you, Chair. I think Donny covered it quite comprehensively already. I would first of all say, what have you learned, Mr. van Esch? Well, one thing I've learned also from my talks to our Nigerian colleagues and visits there, we have amazing Nigerian staff that work under incredibly difficult situation, not just for their personal security, but of the challenges in the community, the challenges in keeping the infrastructure and looking after its integrity, cleaning up spills, et cetera. That is the first thing that I've learned, and I have the highest respect for our Nigerian staff in that regard. The other thing that we have learned is that this is a very difficult challenge. When law and order breaks down, when sabotage and theft is rife where you try to operate, no amount of effort that we put in can actually try to compensate for that. I think the important lesson that we have learned is that this is not anymore a risk that we feel we can be exposed to. It's not something we can solve. We cannot solve community problems in the Niger Delta. That is for the Nigerian government perhaps to solve. We can do our best, but at some point in time, we also have to conclude that this is an exposure that doesn't fit with our risk appetite anymore. We've drawn that conclusion, and we're now talking to the Nigerian government on the way forward. Thank you very much. Next question. Mr. Chair, I have another question on the line here. It's a question from David Prosser. Should Shell be rebranded as an energy company, not an oil company, i.e., to be called Royal Dutch Shell Energy PLC, to make quite clear that the generation of energy is in its business and the extraction of oil and other carbon-generating forms of energy are part of its history rather than its future? Mr. Prosser, thank you very much for your question. I'm glad you're focusing on the Shell brand because the Shell brand is very valuable. It's well perceived by consumers and thought of highly around the world. We have an outstanding branding organization here that works thoroughly to find the best way to use that and how to project it as we go forward. We will take that spirit, the naming and the focus of how we communicate our brand is very critical going forward, and we'll take it into account. Next question. Mr. Chair, I've got a question here from the Dutch Shareholder Association, the VBDO. Question one, Shell offers its customers carbon-neutral driving based on the offsetting of customers' emissions through carbon credits, fires, et cetera. Shell mentions the use of high quality and independently verified nature-based solutions. It refers to a McKinsey report which outlines the NBS benefits and business opportunities valued at $50 billion by 2030, but also acknowledges various challenges. Without consensus on an internationally acknowledged framework to measure and verify NBS carbon credits, how does Shell intend to approach risks related to carbon credits and related to natural climate solutions to ensure it's aligned with its targets? Second question from the VBDO. In the upcoming years, can Shell transparently report how it performs due diligence regarding NBS to guarantee stakeholders that carbon offsets are indeed realized? Let me pause there, Mr. Chair. Thank you. Very important questions. Ben, could you address that, please? Yes, absolutely. Thank you very much. Well, you do indeed bring up a very important point and a point that we have been raising ourselves as well. We believe, let's first of all make that point as well, that nature has a role to play in dealing with the climate challenge. There will be many emissions that are diffuse, hard to capture, and hard to avoid that will need to be offset. Our philosophy is that we would only use offsets like nature in those cases where it is a last resort, where actually avoiding the emission or capturing the emission another way is simply not possible. You can imagine, of course, they are mostly going to be the emissions of our customers, like for instance, people who drive a car still with an internal combustion engine in it. You're absolutely right that there are many challenges when it comes to nature-based solutions. It's still a very embryonic market, and therefore we have said very clearly we will only use the highest quality products that are available. It would be so much better if there was a separate body that would certify that, and that is what we are calling for as well. Now, in the meantime, we not just rely on taking credits out of the market. As a matter of fact, we do our own origination. Basically, with that I mean we are involved in our own landscape projects, reforestation projects, protection projects, so that we have a direct line of sight on the quality of the credits that we are creating ourselves. in the end, if the world indeed is going to rely on this, which is inevitable to a very large degree, we will have to have independent verification. That's exactly what we are calling for. indeed, challenges like rebaselining, challenges like forest fires, et cetera, they all have to be taken into account. to the extent that we can, we do take that into account. We do take into account that some of this carbon will leak back, and therefore, we will have an extra safety margin in how we create these individual credits. Going forward, I think your second point is an excellent point. We will have to show more transparently how we are using these credits, what sort of credits they are, and what sort of verification actually sits behind it. without it, I fully agree with the sentiment of your question, this will remain to be an issue of challenge by many people who are critical to the use of nature by companies like ourselves. Thank you. Next question. Operator, let's go to a question on the phone now, please. Next question from Doug McMurdo from PRRC. Please go ahead. Very good afternoon, Mr. Chairman. I think it's afternoon for you now, but good morning. Just to introduce myself, I'm Councilor Doug McMurdo, Chair of the Local Authority Pension Fund Forum, representing 83 fund members under further seven full companies with assets under management as asset owners, I might add, in excess of $420 billion. Mr. Holliday, I'd like to put on record our thanks for your contribution to Shell, and I do acknowledge many of your positive contributions. Thank you very much. I welcome, and of course, subject to the conclusion of this meeting, Sir Andrew Mackenzie to our company in his new role as Chair. I look forward to working with him, having already invited Sir Andrew to meet me. Just to get to the question, we have recommended to our members, and we've described why, to vote against your resolution and would like to see another next year or, in fact, even earlier, if you were minded to hold a special general meeting. We would like to see a resolution that sets targets, putting aside the potential income from the oil and gas sector in the short term, which too often many portfolio managers will be principally concerned with income. It requires focus on the medium to long term, which I've heard already this morning, for the sustainable viability of Royal Dutch Shell as a net zero company in a market with competition from renewables and with credible plans for any use of offsets such as nature-based solutions and carbon capture and storage, but to include the financial risks. Are you prepared to work with LAPFF and better understand our asks and importantly, to bring about a clear and robust, just transition to a net zero environment in a timely manner? Thank you, Mr. Chair. Thank you. Let me comment, then Ben can add. First, thank you for doing exactly what we hoped, to have a dialogue, to understand the aspects of our strategy that you support and those aspects you'd like more clarification on or possibly consider adjustments. This is exactly what we hoped as we put this forward and look forward to working with you in maybe a better setting where you can understand more details. Ben, would you like to comment on any specific suggestions now? Well, first of all, to also thank you, Mr. McMurdo, for your comments and questions. I hope you will agree with me that we did set out quite a few detailed targets, short, medium, and long-term. We did also include, by the way, a significant amount of financial numbers in there where we expect the bulk of our investment to go to, also where we expect the cash flows to come from going forward. Of course, as you can imagine, many of the risks that we have financially are also related to the macro environment. There is indeed a lot of discussion about the risk of, for instance, stranded assets or the risks that the transition could bring to a company like us. As you may be aware, we are early supporters of the TCFD, the Task Force on Climate-related Financial Disclosures. In the report, there is actually a section dedicated to how we embrace the recommendations of the TCFD. There are many recommendations in there and a lot of also disclosures associated with it, many more than we could include in a 32-page document. If you would, for starters, go there first and indeed follow the pathways that we have in the report to the various disclosures we have, you can begin to understand how we ourselves see the risks, and hopefully you can begin to understand that these risks are not out of the ordinary. If indeed there would be the need for further dialogue, could I suggest, sir, that you reach out to our investor relations team, who can talk you through it in a bit more detail, or can bring you into contact with the right experts in our finance organization. We would be delighted to listen to you and your recommendations for how else we can improve or further the disclosures that we have in this area. Thank you. Next question. I will now take one or two questions online again, Mr. Chair. We've got a question here from Nesla Mehmet representing DWS in Germany, which is one of our shareholders. They've raised here about five, six questions. In spirit of having only a few questions by shareholder, I'll summarize it in three, and then we will go back to them on the last outstanding questions with the investor relations team. The first question from DWS is to the auditor. Could you comment on the feasibility of Shell's energy transition strategy with regards to whether the company can provide investors with visibility over how a net zero pathway could impact its financials? What risks do you see? That's a question to the auditor. Two questions now out of five for Shell, and then we'll come back on the other outstanding questions, as I said. In your ambition to achieve net zero emissions by 2050, why are Scope 3 emissions not explicitly included as a target? First question. Second question, in your scenario planning, do you refer to a 1.5 degrees Celsius scenario, and if yes, do you plan on reporting on the key risks and opportunities identified? Let me pause there, Mr. Chair. Thank you. Allister, if you could speak to the questions direct to the auditor first, and then Ben, if you'll take the other points. Thanks again, Chair, and thanks for the question. I think perhaps this is more of a question for the company to answer more than me, but I'll give you my view, and I think I've already covered many of the points. I think it's very difficult to estimate what adjustments would need to be made or what estimates need to be made, what assumptions need to be made in order to achieve Paris 2050. My personal view, it's a very, very difficult exercise just in instances like oil price assumptions, but also in terms of alternative technology, because I think a lot of the effort to achieve the 2050 targets will require the technology that we don't even have yet. I think it's a very difficult exercise to perform from my perspective, to make judgments and assumptions that would be applied to achieving something 30 years in advance. That's my view from my perspective. Thank you. Ben? </edited_transcript Yeah, thank you very much. Let me deal with the two questions. The first one puzzles me a little bit, to be perfectly honest. Why would our ambition to achieve net zero not explicitly include scope 3 emissions? As a matter of fact, it does. When we talk about our ambition to be a net zero emissions energy business, it includes scope 3. In other words, if we are going to be at net zero by 2050, or for that matter, any target that we have set as an interim target, this will take into account the emissions from our own operations, the emissions of the energy providers that service, that's scope 2, actually, and also the emissions of our customers. The ones who use our products. of course, you can imagine that the emissions of our customers are best tackled by providing them with energy that doesn't have any carbon in it. if it has to have carbon in it, then at least it should be bio-based carbon. in other words, carbon that is already inherently offset. of course, we will take into account also the actions that our customers take. of course, many of our customers will have to take actions if they have no alternative but to use carbon-based energy. there will be plenty of our customers still in 2050 that will have no access to technology or products to just have no emissions at all. Think of aviation. I think there will still be planes flying around based on petroleum-based jet fuel. Now, we have to find a solution for those, but we've also said we will not sell any oil and gas products anymore to any customer who will not deal with the emissions that it causes. in other words, our entire value chain will be net zero, either because we have done it or we have worked together with customers to do it. Now, on the scenario on a one and a half degree centigrade, yes, that is what it is. again, I will refer you back to the report where we explain how we got to it. maybe also hear a few words. This is not based on our scenario. The one and a half degree scenarios that we use are the scenarios of the IPCC special report on one and a half degrees C. There are multiple scenarios in that report that show how the world could get to one and a half degrees. Some are more likely or more plausible than others. We've removed some of the outliers, which we thought were, frankly speaking, too optimistic, too technically infeasible, or relied too much on sort of shock change. The core of these scenarios, we have used to say, within that band, we have to move as well. That's how we have set our targets. Of course, many people say, "Well, the risks are very clear. Your oil and gas won't be needed anymore." No, I think there will still be oil and gas needed, as a matter of fact, also in 2050, if only to use as a carbon base for materials that the world will still use. as a matter of fact, if you just use the projections of our production, most of the reserves that we have will be produced by 2035, definitely by 2050. the risk that we are somehow sitting on resources that can't be produced anymore is actually quite negligible. wherever we take longer-term decisions, we will make sure that they are carbon resilient, that they are first quartile in their class, so if the world is still using some oil and gas, we will be fine from a carbon intensity perspective. Now, there may be other risks. Refining. Will the world need as much refineries as it does? Maybe not. that's why we are concentrating our portfolio to six refineries from 64 that we had when I joined Shell. finally, a lot of people think that when the world will finally indeed be successful in turning its back on oil for transportation and industrial processes, surely the oil price must come down as well. Well, that correlation is not a guaranteed. As a matter of fact, many of scenarios will actually show that we can also see a very high oil price scenario because we will continue to invest in oil and gas production as a world, not as a company, as a world to still meet the shrinking demand for oil and gas. Because the way supply will shrink without investment is much faster than the world ever would have to shrink demand. I think the risks are actually well understood. Of course, we try to continuously challenge ourselves. Are we critical enough here? the more important thing is there are many opportunities, and these are the opportunities also that we have laid out in the 32-page report, how we transition the company. Thank you very much. Thank you, Ben. Next question. Mr. Chair, I'll now take the next question here online, and I'll read it. You have to bear with me because it is also a statement, and then I'll come to the question. This is a question from the Vereniging van Effectenbezitters, so the Dutch Shareholder Association, the VEB. VEB votes in favor of the Resolution 20, Shell's energy transition strategy. Getting to this point has by no means a walkover. We feel that we owe our support to Shell right now. Shell commits to being carbon neutral in 2050. With this, it's already ahead of the pack. Most importantly, albeit under the guise of an advisory vote only, we, the shareholders, now get to have a say on Shell's climate strategy. This is a groundbreaking turn from the past, and as much as it's first of its kind. Voting in favor here and now is our way to express that we take Shell up on its pledge to give due credit to its shareholders. Put differently, we believe that voting in favor is our way of saying to Shell that to us, its energy transition strategy is a binding commitment. Shell expresses that in acts in line with Paris Agreement. We will not shy away from calling Shell to account if it turns out otherwise. With that, we do wish to see clear performance measurement. This is needed from next year onwards. On the disclosed short-term, medium, and longer term emission reduction targets, but also as to whether the investments in its green propositions concretely yield the depicted financial returns trajectory. For the avoidance of doubt, we vote against the Follow This resolution. Our support for the Shell resolution expresses that we take Shell up on taking its shareholders seriously. Our voting behavior must be aligned to that. This is not to say that we don't endorse Follow This request that Shell reports on its performance towards its targets. During the strategy day, Shell mentioned that as the size of the growth pillar in its business will increase, financial performance will become less dependent on oil and gas prices. However, for the next decade, Shell's cash flows will still be highly correlated to oil and gas prices. To what extent are Shell's ambitions to lower its carbon footprint dependent on the development of oil and gas prices? i.e., in a $30-$40 oil price scenario, could Shell generate enough cash flow to stick to its capital allocation plans for the growth pillar and realize at the same time its net carbon intensity reduction targets? Here are the statements from VEB, and the last question stops, Mr. Chair. Well, we thank you very much for your statement. It is very much in the spirit of dialogue that we would hope would occur. We had this resolution forward, and we're committed to continue conversations with you to move forward. I'd like to ask Jessica to talk to oil price a bit from her perspective and how that's impacting our plans and how you deal with that in your financial planning. Thank you for the question. Indeed, our cash flows today are to a large extent impacted by the oil and gas price environment, as well as the refining downstream margin environment as well. That will impact our cash flows. However, when looking forward in terms of the energy transition, we've built a company that is fundamentally resilient to a wide range of outcomes in terms of the price environment. I think you saw that in terms of our 2020 performance, a very dramatic year in terms of the macro environment. Yet in that year, Shell generated significant cash flow and importantly reduced our net debt, which is a very good measure in terms of the resiliency of the company in a very extraordinary set of circumstances. while we would benefit in the near term because of our composition of our company, the composition of the energy system with a higher price environment, our strategy is not dependent on a higher price environment. in a lower price environment, we would still generate the cash needed to generate significant cash flow, and to invest in our growth pillar and to reshape the future of the company. while it might be constrained in the near term, I think 2020 showed that we have the resilience to take the steps necessary to reshape the company from an operational expense standpoint, to reshape it from a capital expense standpoint, to ensure that we do have the cash available to reshape the company for the energy system of the future. Thank you. Next question. Operator, can I have the next question online, please? We can now take our next question from Natasha Landell-Mills. Great. Thank you. Can you hear me? Yes. Yes. Hello. My name is Natasha Landell-Mills, and I'm representing the asset management firm Sarasin & Partners, and I actually would like to ask two questions, if I may. The first to the audit committee chair, and Ann Godbehere is here. Shell has clearly stated in its annual report that its accounts are not drawn up using assumptions consistent with the Paris goals because it does not see this as a likely scenario. However, shareholders have a legitimate interest in understanding how the world transition onto a 2050 net zero pathway could impact Shell's capital strength and performance, not least because, as we've been hearing this morning, this is the pathway that Shell has committed to. With the publication of the IEA special report on a 2050 net zero pathway this morning and projections of oil prices falling to $35 a barrel in 2030 down to $24 a barrel by 2050, this visibility becomes even more urgent. Could you please comment on whether the audit committee will look again at whether its accounts should use forward-looking assumptions consistent with the Paris Agreement or at the very least publish the results of sensitivity analysis showing how a Paris-aligned pathway could impact its financial position in its next financial statements? My next question is for- Please go ahead. Thank you. My next question is for the auditor, Allister Wilson, who's been getting a lot of attention this morning, quite rightly. I wanted to first of all state that we really welcomed EY's very detailed response to the IIGCC investor expectations for Paris-aligned accounts in Shell's annual report. We likewise very much appreciated the clear opinion that Shell's assumptions are not in line with the Paris pathway. EY, as we've also heard this morning, however, indicated that it is neither possible nor appropriate for them to provide disclosure of the financial statement consequences of such a scenario. However, I'd like to make three points, if I may. Firstly, Deloitte did provide such commentary for BP this year. Secondly, EY does undertake stress testing for critical forward-looking assumptions already, and it is unclear why scenario aligns with net zero is not appropriate or possible. Finally, in light of the publication this morning of the IEA special report that I mentioned before, which includes commodity price trajectories, this will provide an external benchmark to support such stress testing. The prices that the IEA scenario came out this morning are $35 a barrel in 2030 and $24 a barrel by 2050 underlines the importance importance of doing such a stress test. We would like to know whether EY would provide investors with the visibility they seek on the risks from the 2050 net zero pathway next year. Thank you very much. Thank you for both your questions. I will, as you suggest, turn to Ann and Alistair in just a minute. Let me first speak to the IEA report that came out this morning. We just have not had time to study that in depth, understand the assumptions, see how they compare with ours. I think it'd be very inappropriate to respond to that report at this point in time. With that set aside, we certainly will in due course as we have a chance to study it. I would like to turn to Ann now to respond to her questions. Thank you, Chad, and thank you for making that remark because it was a good first remark I was going to make. That, of course, as we take a lot of external information in, we will be studying that over time. Let me make perhaps a number of remarks this morning. Ben opened his remarks today by referring to his excitement on direction, first steps, and strategy. The board shares Ben's excitement and commitment for Shell to become a net zero emissions company by 2050 in step with society. However, as both Chad and Ben have sort of said in answering a number of questions, but also in their remarks this morning, regardless of the strength of our commitment, meeting the goals of Paris alignment requires the economy to transform in a number of complex and connected ways. To say that our accounts are Paris-aligned today would imply that a path of how to get to net zero by 2050 is already 100% mapped out, not just by us, but between governments, companies, customers, and society. As we've talked about a number of times already, that detailed path to transform across all stakeholders simply does not exist today, which is why no one company or government, I believe, can state today that its accounts are Paris-aligned. As Alistair, our auditor, has responded to an earlier question as well, we don't know what those assumptions should look like 30 years hence. Having said all that, let me make a few more comments. One is, in not responding to what's only come out this morning, but Ben made an important observation to a recent response as well, and that is about our reserves and the fact that our current reserves are expected to be entirely used before 2050. Just sort of another important point. Let me say something about our accounts as well and the climate change energy transition. That is, in fact, a key consideration today across many critical accounting judgments is carbon pricing, climate change, energy transition. In fact, in our Audit Committee Report, in the annual report, we refer to some of this in our key areas of judgment. I know from time to time we get a question, well, why don't you have climate change and energy transition as a standalone area of key judgment in the report that we put into the annual report, the Audit Committee Report? I say because climate change and energy transition is not a single focus area. It cuts across many of them. Again, Allister mentioned a few of them this morning, and three of them are highlighted in the Audit Committee's report in the annual report. That's around, obviously, impairments, taxation for tax assets, the future of the refinery portfolio, and again, specifically on that one, reflecting energy transition, the company's strategy of moving from, for instance, 14 sites to six high-value chemical and industrial parks. I'd like to assure everyone that's on the call today that the Audit Committee is very focused on this, that also, as we said in the Audit Committee Report, we specifically this year have asked both our external auditors and our internal audit function that every time they report to the Audit Committee, that they specifically highlight what work they are doing on climate change and energy transition on our financial accounts. We are gathering a lot of information. We're trying to be transparent about it. We're not trying to overstate by saying we're Paris-aligned today. As I say, that pathway is still an uncertain pathway. Over time, certainly assumptions will change in the next 30 years. We believe we are taking all the information that exists today that is relevant and appropriate for making assumptions in our financial statements and are incorporating it. Thank you. Allister, I think you were going to address the question as well. Thanks, Ann, thanks, Natasha, for your question. I think a lot of it has been answered by Ann already. In terms of our commitment, I'm not sure that I can make a commitment today because we will see what happens in the end and the progress that the company makes. In terms of what we do, we'll to a large extent, be driven by what the company does. I would just make the point that assumptions need to be supportable, and that's the biggest impediment to preparing a set of accounts with assumptions, and estimates, and judgments that are supportable for something that's going to happen in 30 years' time. It's not really for me to comment on Deloitte's and BP's accounts, but I think that's why earlier I made the distinction between a company pursuing an energy transition strategy that is consistent with the Paris goals, which I think is what Deloitte says, versus Paris-aligned accounts. it's something which, as I said, we will certainly look at today and focus on this year and will be done in conjunction with the progress that the company makes. Thank you, Alistair. Next question. I'll now take two, three more questions online. First question is from Vanessa Calvache, representing Fair Share. She's asking a question on behalf of ShareAction. My question is in relation to the real living wage, as defined by the Living Wage Foundation. This is an hourly rate calculated to reflect the cost of living in the U.K. It is currently £10.85 per hour in London and £9.50 per hour throughout the rest of the U.K. Living wage employers commit to providing all direct employees and third-party subcontractor staff essential to the success of their businesses at least this rate. Momentum behind the standards has grown. There's now over 7,500 accredited employers, including 45 of the FTSE 100, and BP who accredited in 2020. Please would the board provide an update on Shell's position regarding the living wage. Additionally, would the board be willing to meet with ShareAction and Living Wage Foundation to discuss this further? Thank you. Ben, could you comment on that or should we take it offline? I can make a few short comments on it. I think the area of living wage is indeed an important area, and I know that there are definitions out there, but there is also a wide range of opinions on what exactly is a living wage and how it should be applied. We are still studying the evolving landscape there, but we are very clear that we expect to pay our employees, whether that's in the U.K. or elsewhere, a wage by which they can comfortably meet all their financial obligations. We benchmark that quite extensively, and we survey whether our people believe that they are paid fairly and appropriately, and so far, all indications are that is the case. When it comes to the indirect employees, we believe that actually is a different matter. We do not control the remuneration policy of the people that we work with, other companies. We have set in our supplier principles very clear expectations that we expect our suppliers to pay their employees, first of all, a minimum wage, but also pay them responsibly so that indeed they can meet their living requirements. We're very happy to have further dialogue with you, Ms. Calvache, and I suggest that the IR team reaches out to you and set up a further dialogue if that is needed. Thank you very much. Thank you. Next question. Next question is again online. It's from Moira Elizabeth Johnson. Greenpeace and Friends of the Earth have accused Shell of investing heavily in fossil fuel initiatives very recently, despite the escalating climate crisis. What can you offer in your defense? It must be a very difficult dilemma for a company based on oil. Let me take that question. We offer Resolution 20, and we think that comprehensive description of what we're doing is the right steps. We believe the world does need oil and gas for some period of time. We described it quite well in our work, and we think it speaks for itself. Next question. The next question is from Peter Jeffrey Conquest. Does the company have computer-controlled systems that might be susceptible to hacking by unfriendly agencies? He has another question. Does the company have any pipelines in the U.S.? What precautions does the company have in place to protect computer-controlled systems that might be susceptible to hacking by unfriendly agencies? Thank you for both your questions. Jessica, could you take both, please? Yes. Thank you, Mr. Conquest, for your questions. Unfortunately, most companies and individuals are susceptible to hacking. It is a key priority for the board as well as the executive committee. It's a topic that gets special attention in both forums, and over the years, we have built considerable defenses to protect ourselves and the entire value chain of systems from preventing and detecting issues to recovery should an issue occur. It's an area where there's a lot of coordination that happens between the private sector and the public sector with governments around the world, also between companies and industries. It's probably one of the better areas where you see collaboration happening because it is such an important issue for all companies and frankly, for society. I'd also note that should Jane Lute join our board, her expertise in the space will also be beneficial to the board. We're working hard to create essentially a zero-trust environment, investing considerably, as I said, to understand all threat vectors that may cause issues from phishing attacks to PCS control systems, et cetera. In general, I'm pleased to say we have been reasonably effective in terms of managing the threats over the last several years. We've had no material interruption to our operations and certainly none to our business-critical issue systems. However, there are issues that we have faced, and things don't always go as we would like them to, but on the whole, we've been able to manage it effectively. It's an area, though, that will require chronic unease. Those are words that we use within Shell on issues like this, given the sophistication of the unfriendly actors as referenced that show considerable persistence and professionalism at their craft, but also recognizing with digitalization, the potential of this issue will only grow throughout society. It is front of mind today, and I expect it will continue to be so. Thank you. Next question. Another question here online. It's from Sunil Kumar Paul. My question on diversity and inclusion on page 108, I assume he is talking about the annual report, and diversity of leadership on page 141. Why is it an all-white board and all-white senior management? Let me address the board, and Ben, you could speak to senior management. It's not an all-white board. We have diversity of multiple forms. We also have, with completion of this AGM, we'll have 50% women. We believe a diverse board is very important, and we believe racial diversity, which is implied by this question, is important, and we do have diversity today, and we'll seek to continue to diversify in the future. I'm quite proud of the way the board stands today and the way it acts on diversity and the way it takes into account. Ben, could you speak to management? Yeah, thank you very much, Mr. Kumar Paul. If you look at the executive committee for starters, I do believe we have a reasonably diverse management team as well. We have one member of our management team from Southeast Asian origin, and we have one member of our management team from Middle Eastern origin. more importantly, if you look at the top, say, 200 people in our company, you will also find that not only do we have reasonable diversity in terms of ethnicity, but that it is actually improving over time, and we pay specific attention to it, and we go through the organizations as we are currently doing. also on the matter of gender diversity, at this point in time in our senior staff, we have 30% of the leadership positions occupied by females, which I think is probably one of the leading percentages in our industry, something we're very proud of. Thank you very much. Next question. I've got a question here, Mr. Chair, from Dutch Shareholder Association, the VBDO. The VBDO would like to compliment Shell on the fact that it has diversity and inclusion initiatives for a wide range of diversity dimensions: gender, LGBTI, ethnicity, and ability. Shell utilizes the people survey to understand its diversity and inclusion performance. Can Shell expand on the results of this survey and what activities Shell is undertaking as a response to these results? Additionally, has Shell analyzed this survey to specific, between brackets, minority groups, for example, groups separated by gender or nationality, in order to understand the inclusion of these groups? If not, can Shell commit to start analyzing this in the future and transparently report on the matter? Those are the first two questions. There's a follow-up question. Shell is clear about its commitment to human rights, both in its own operations and its supply chain. Following this commitment, Shell indeed conducts assessments in case of high-risk suppliers. VBDO and other stakeholders are, however, unable to gain insight into several vital aspects of the systematic approach that Shell employs to guarantee human rights are upheld in its supply chain. Can Shell, similar to the information it currently reports regarding local communities in the sustainability report on page 79, provide insight into the work that it is doing in its supply chain? I think some of this question could probably be handled offline with our investor affairs group, but Ben, would you like to comment now? </edited_transcript Thank you very much. They are indeed important questions. We do take the Shell People Survey outcome very serious. We've been doing this for decades, and we continuously evolve the survey. We debate it extensively, and we do deep dives and adjustments to the survey to understand better exactly what the issues are. The matter of diversity, ethnic inclusion, or inclusion in general, are indeed very important and continuously evolving. I have to give some thought to the idea to what extent we want to put broader information out. This is not meant to be for disclosure. This is meant for us as management to manage the company with. I do believe indeed in today's day and age, it is important that we are transparent where we can. Let me give that some thought. Thank you. Next question. Operator, can we go back to the phone, please? I think there's one more question on the phone. Thank you. Yes, sir. There's one more question from Mr. Winston. Please go ahead. Please use your computer before you ask your question. Please mute your computer. I think we're having difficulty hearing you. Okay. If he comes back on, please bring him back again and give him instructions so we can properly hear him. </edited_transcript Okay, we go back to the line here. I've got a question from- Sorry. Thanks, Ben. I've got a question from Christian Donovan. The investor seeks the reassurance of the board that it will not, engage in acts of identity politics, avoid becoming involved in the toxic, divisive current identity political agenda, not giving political donations, not support groups that masquerade as civil rights or of rights groups when they are, in fact, political organizations. We thank you for your guidance, and we are sensitive to all the subjects you raise in your question. They're very important to us. I can assure you this company is very thoughtful in what we support and what we don't support. If you look at the analysis we made of trade associations, Wrenn, I think that's leading-edge work that says we are really thoughtful about what we do, and we'll assure you as a shareholder that we'll take all that into account before we think about engaging in some of the areas you're talking about that we know are a major problem in the world today. Next question. I've got a question here from Marianne Pritchard. Exploitation and development of new oil and gas fields must stop this year if the world is to stay within safe limits of global heating and meet the goal of net zero emissions by 2050. This according to the U.K. government-requested report from the IEA. How is Shell going to respond to this challenge? As I stated earlier, the IEA report has just come out today, and we have not had a chance to study it. We certainly will and take into account. I believe if you look at our energy transition strategy report, we've staked out a number of places there where we've reached key production, and in 2025, we will stop new frontier exploration. Next question. Got a question here from Francisco Stetero. Your energy transition strategy states you expect no new frontier exploration entries past 2025. Can you elaborate on this, please? Does this mean no more drilling new exploration wells? What does new frontier mean for existing exploration licenses and commitments? Will this open doors for other operators to step in? With no new exploration, how will this affect reserve replacement ratio and affect the company's financial performance? Thank you. Ben, could you address the question? Yeah. Thank you very much. What we mean by new frontier exploration is that we will not enter into new basins, new areas where we currently have no position to go and explore whether there are working hydrocarbon systems and then produce them. Which doesn't mean to say that we will not be drilling wells anymore. For instance, in the Gulf of Mexico, where we are well-established, we will continue to find ways and means to keep our production assets full. we will do that because it makes sense economically, but more importantly, it is basically fulfilling the need for oil and gas that the world still needs. Now, does it mean that, for instance, if we do not move into a certain country, that another company can still move in and develop these resources? Yes, absolutely. therefore, I reiterate a very strong conviction. If we, as a world, are going to transition away from oil and gas to other energy products, we have to do something about the demand of it, not the supply of it, because the supply will keep on coming, if not from us, we supply only 1.2% of the world basic primary energy, then it will come from somebody else. Now, will that mean that our reserves lives will reduce over time? Yeah, no doubt. It will also mean that we will find new business models to invest in. Therefore, I do believe that the viability of our company is not per se at risk simply because we move from one form of energy product to another form of energy product. Thank you. Next question. Got a question from Richard Trevithick. Would it be possible for Shell to introduce a divestment reinvestment scheme where shareholders could opt to reinvest their dividends into purely renewable energy assets, which Shell would develop, perhaps creating a new share class? This would greatly expedite Shell's transition to net zero carbon, produce future dividends derived from renewable sources, and set the lead for the other major energy companies to follow. Thank you for your suggestion. I don't think it's appropriate to go into detail of analyzing that suggestion now, but Jessica, could you speak to the subject, please? Yes. Thank you, Mr. Trevithick, for your question. I think the most effective investment in terms of transitioning the energy system and bringing low-carbon energy solutions to the world is to invest in Shell. Our strategy seeks to leverage all of the resources of this company to drive for a low-carbon, no-carbon future. That's true in our chemicals business, it's true in our marketing business, it's true in our LNG business, it's true in our upstream business, as well as our new energy business. I think in terms of our company and our strategy and our potential to have an impact on the energy transition, reinvesting in Shell is the most effective way forward. Thank you. Next question. The next question, Mr. Chair, is from Annabel. No, sorry, is from Susan Margaret King. How many transfers of domestic energy supply to Shell Energy encounter problems and remain unresolved after 30 days? What's being done to keep potential customers informed if problems are encountered? How much compensation is faced as a result of these problems? Are customers asked for feedback on how well the transfer has been handled? For all shareholders' knowledge, we believe this relates to the Shell Energy business in the U.K., and these are very specific questions. If you will contact our investor affairs, we'll be sure to align you up with the right people to answer those questions. What I can tell you, we take customer service very seriously. Members of the board have actually visited this facility and understand what our people are doing to give even better customer service going forward, and we'll take your questions into account. Thank you. Next question. We have a question from Annabel Rosemary Howland. In a week's time, the court will pass judgment in the lawsuit that several environmental organizations and over 17,000 people have filed against Royal Dutch Shell. In order to act in line with the Paris Agreement, Shell is required to reduce its CO2 emissions by 45% in absolute terms by 2030. In my opinion, the organizations have a strong case. What would be the consequences of the value of my shares if Shell loses the court case? What would be the consequence if Shell wins and the parties appeal? Thank you for your question. It would really be inappropriate for us to speculate on a court decision that may come out. We'll take that fully into account and respond when that comes. I would like to turn to Donnie and see if he has anything else to add in general about this arena of court cases around this that would be useful for our shareholders to hear. Thank you, Chair. As you said, I think it's not appropriate at this point in time to speculate on what the court may decide next week. I think in line with what Ben has said, we are very clear that action is needed now on climate change. I think what will accelerate the energy transition is effective policy, investment in technology, and basically changing demand or customer behavior, as Ben has said. We actually very clearly and strongly believe that actually none of this will be achieved through court action, with the case in the Netherlands and elsewhere around the world as well. Addressing climate change is a huge challenge and requires a collaborative and global approach. We really want to play our part, and we are playing our part. I don't think litigation is going to help us move the needle in this direction as well. I think that's all I have to say, Mr. Chairman. Thank you, Donnie. Next question. We have a follow-up question from Vanessa Gelfrage representing Fairshare. She is asking a question on behalf of the Union of Concerned Scientists. Two years after Shell's initial report on climate lobbying by its trade associations, Shell's 2021 review again acknowledged misalignment between the company's climate positions and those of the American Petroleum Institute, API. With your company's contributions to the group of at least $10 million, at least five times what Shell contributes to any other industry group, shareholder dollars are being used to support API's continued irresponsible and anti-climate lobbying activities. Every year of delayed action puts the goal of limiting global warming to 1.5 degrees Celsius above pre-industrial levels further out of reach. What, if any, time limit has Shell set on its engagement with the API, and at what point would Shell suspend its membership, use or discontinue its membership due to the API's failure to align with the company's climate positions? Wael, could you come in, please? Yeah. Thank you very much, Ms. Gelfrage. As you know, we issue a report regularly on our positions when it comes to industry associations or lobbying in general. As a matter of fact, also on our website, we are very clear on the positions that we ourselves take. We do indeed analyze to what extent certain associations that we are a member of are fully aligned with the principles that we adhere to. We are very clear about these principles, and we're very open about the assessment that we have. In cases where we found that there is a major misalignment and no ability to common alignment, we indeed have shown that we will have no hesitation to leave such an association. Now, the API is, of course, an iconic one. As you can imagine, the API does many more things than, of course, lobbying in Washington. It also sets standards for practical matters within the industry. It has a lot of very valuable aspects to it. Indeed, in some areas, we have seen that we have different positions than them. Also over the years, we have seen that the API has significantly moved their position when it comes to Paris, when it comes to the policies that are needed to meet the energy transition needs, et cetera. As a matter of fact, we take no small degree of credit for that, being an active voice and a force within the association. For now, we believe we're better off working with and inside the API with the progress that we have made. If at some point in time we feel that there is irreconcilable differences and we cannot make any progress anymore, we will, as for any other association, revisit our position, and we will have no hesitation to step out of any association for that matter. Thank you very much. Thank you, Ben. We're approaching the two-and-a-half-hour point, and I want to make sure we have time to get to questions on other resolutions besides the ones we've been talking about so far. Let's take another 30 minutes and see if we can move the questions along to a more general nature. I want to make sure if there are questions on other resolutions, they are fully considered. Next question. I have a question here from Hugo Anthony Mino. His question is on resolutions 20 and 21, and his question is to the board, what happens if both resolutions pass? Let me remind you that the vote requirement is different. On Resolution 20, it's a simple majority of over 50%. On 21, it's a special resolution that would require over 75%. There are clear procedures we take on both if that happens. We'll cross that bridge when we come to it. Certainly we will give full, total respect to any resolution on our ballot and handle it accordingly. Our procedures do call for if one of our proposals gets less than 80% or if the proposal from shareholders gets more than 20%, we need to respond to it. We need to dialogue with our shareholders to fully understand their point of view. If that's the case, we certainly will. Next question. Question is from Sunil Kumar Paul. My second question is that you mentioned about India's pandemic in your statement. What sort of help are you giving to India? Oh, that's a great question. I don't have the details of what we're doing to every country, but I know it's extensive. Ben, put you on the spot if you happen to know that. If not, we'll get to you with an answer. No, I think I can make a few points. Of course, we pay close attention to the pandemic in India, as I'm sure everybody does at this point in time. Bear in mind, we have a very significant number of employees in India in places like Bangalore, Chennai, and therefore we have a special duty to our own employees as well there. For our employees, we have obviously health support in place, including for their partners for telemedicine, ambulance support, hospitalization coverage, home quarantine. We have introduced new voluntary insurance policies specifically for COVID-19 that also cover not just the employees, but also their parents and their parents-in-law, because quite often, I'm sure you are aware there are extended families living under the same roof. We have COVID support circles where employees can come and share experiences. They get advice from health experts that we make available to them. We have an employee assistance scheme, and the uptake of it is very, very significant. We have wellness breaks that we introduce on certain Mondays in May, particularly because May has been, of course, a very difficult month so far, giving people the downtime that they need in the coming weeks to also look after themselves and to look after their families. Within the community, we try to do as much outreach as possible as well. We have support for migrant construction workers with access to food, a roof over their heads. We also, which is very important in India, we support truck drivers, very significant population, quite often under very challenging circumstances. We have an eyesight team that we have set up not for COVID, but we have set up to basically improve road transportation safety in India. These have now become COVID health camps, et cetera. May I add, not just specifically for India, but more generally, of course, we are also a major donator to the COVAX vaccination program at $10 million. Thank you very much. Next question. Mr. Chair, I have a question from Harry George Cracklow. While still an undergraduate in biology and chemistry, I was aware of concerns about global warming. I even wrote an assignment on the ethical reasons for pursuing solar energy and the possibility of a hydrogen economy. Forty-five years later, things are still getting worse. Having waited so long, some of us who are now getting older would like to see the transition away from carbon happen much quicker than seems to be happening at the moment. Could the board see their way to speed up things so that the older generation can see significant decreases in atmospheric carbon compounds, please? Well, thank you for your work on the subject. Thank you for your question. As we've described, what's included in Resolution 20 is significant acceleration of our plans within Shell. We're quite proud of that. What we will be looking at is every year how we can make it even faster, and particularly with the update three years out, and we'll certainly take into account your suggestion. Next question. </edited_transcript Next question is from a Dutch shareholder, and Ms. Van Earp has got two questions. Can Shell do more in the short-term perspective to make progress towards net zero? The second question from her is, in what way can CSP, concentrated solar power, help us achieve our goals? As we are starting this dialogue today with this resolution before us, we certainly will be focusing on those goals. Ben, could you comment any on concentrated solar power, any work we have there? Thank you very much, Ms. Van Earp. We don't at the moment have concentrated solar projects in our portfolio, but it doesn't mean that we couldn't have them. We very much focus on developing photovoltaic solutions, both in, well, actually in North America, we have a significant stake in a company that does that, but also in the Netherlands, as I'm sure you all have seen in news coverage. We have, of course, an investment in a Southeast Asian company that does rooftop solar as well. Whether concentrated solar will play a bigger role remains to be seen. We are technology agnostic as far as that is concerned. Thank you. Next question. I have a question, Mr. Chair, from Juliet Howland. Shell has announced ambitious plans to compensate its carbon emissions. As part of the Shell Energy Transition Strategy, it has presented extensive plans on carbon capture and storage and on nature-based solutions such as planting trees. I am concerned that Shell will not be able to achieve its goals. How much is Shell going to invest annually in these compensation programs, and how much will it rely on public funding? Thank you. Thank you for your question. Ben addressed this pretty thoroughly in his presentation, but perhaps you could answer the specific questions. Yeah. Thank you very much, Mrs. Howland. Indeed, it is, we believe, a very important component of the climate solutions toolkit, and we want it to indeed come out of its more embryonic state. We're not the only ones. Many other companies and advisory bodies believe that this is going to be a major business and a major solution space, and therefore, we are investing in it ourselves as well. In 2020, we invested about $90 million in forestation, reforestation, and forest protection projects. Going forward, we expect to invest about $100 million a year in these types of projects, basically creating the credits for ourselves that we need to grow that growing part of our portfolio. Thank you. Next question. I have a question from Adam McKibbon. The question is: With BP/Shell's interest in Australia's North West Shelf and the Browse Basin set to result in 20 trillion cubic feet of gas being drilled, processed, and burned until 2070, how does production of this new basin align with BP/Shell's target of net zero emissions by 2050? Ben, could you comment, please? Thank you very much. You refer to the Browse project that is currently still at an early development stage. It is not a Shell-operated project. It's operated by another venture, but we are indeed, at this point, a shareholder in it. When we or if we would take an investment decision in that project, we will have to make sure that it's fully aligned with the plans that we have all the way to 2050 and probably beyond. You can rest assured that we do that, otherwise we will not sanction the investment. Next question. Got a question from Mrs. Wensing, and she was the one who earlier could not get through the phone. Her question is: Can the Shell board imagine a Shell without oil, gas, and corruption? Can it see itself do justice to frontline communities, repair damage, and help Shell employees find new careers? Let me speak to the corruption part of the question, which is quite different than oil and gas. As I highlighted in my comments at the start of this meeting, I am quite proud of the ethical standards in this company. I think they're just outstanding. I think we're battling to fight corruption everywhere all the time, and I could not be more proud of my colleagues in Shell for what they're doing. We have laid out clearly that oil and gas will be decreasing over time, but to sit here and envision a point in time when that would not be a part of our company, I think is out of range at this current point. Next question. We've got a follow-up question here from the Dutch Shareholder Association, the VEB. The VEB appreciates Shell's transparency that's provided by its capital allocation framework. We have two questions. Could Shell explain why a progressive dividend policy is sensible given the fact that business performance can be very volatile depending on swings in oil and gas prices? Doesn't Shell make the same mistake twice? Second question from the VEB. Once Shell reduces its net debt as planned to $65 billion US, it is very likely the share price will be substantially higher than today. Should shareholders be concerned that by using this framework, Shell will engage in a pro-cyclical share buyback program, hence it will initiate repurchases when the share price is high, which is not very attractive for long-term shareholders? Thank you. Jessica, could you address these questions? Yes, Chair. Thank you for the question, and thank you for the acknowledgment of the transparency on the capital allocation framework. We've put a lot of effort into providing the right level of transparency, so thank you for noting that. As a company, there are three main objectives we need to achieve with our capital allocation. The first is to ensure we have sufficient capital to invest in our current business, and importantly, to reshape the company for the future. That's primarily through CapEx, but also through OpEx. The second piece is to reduce debt and ensure we have a strong and resilient balance sheet to manage swings in oil and gas prices and impacts of the macroeconomic environment or to manage things like a global pandemic. the third piece, importantly, is to reward our shareholders, the owners of the company, so that we can attract and retain capital to strengthen the company and to invest in the future. We put forward a capital allocation approach last year, and specifically with respect to shareholders laid out a return profile that we believe is the right one given the shape of the company today, the cash flows of the company today, the risk profile of the company today. There's two main elements to it. One is the progressive dividend, which you referenced, of 4% a year. We believe that is an attractive number for our shareholders. That's important, as I said, to provide a compelling return to the owners of the company. It's also a resilient one at 4%, given our dividend base. That's some $200 million-$300 million a year. We believe that is resilient through a range of scenarios. The second piece is once we get below $65 billion in terms of net debt, is to increase shareholder distributions to some 20%-30% of our cash flow from operations. We expect share buybacks will be an important part of that. We acknowledge the risk around pro-cyclicality. However, share buybacks we believe is an important tool in terms of rewarding our shareholders. One, it allows us to manage the overall dividend exposure over time, in terms of reducing the share count. It increases earnings per share as well, over time, and gives more of our cash flow available to our remaining shareholders. It also is more flexible, which comes back to one of the earlier points as well. Through cyclical moments, lows and highs, a share buyback approach can give us more flexibility in terms of the quantum of distributions to our shareholders, and help manage some of that volatility. We think on the whole, as I said, it is a compelling approach for our shareholders and a resilient one. Thank you. Thank you. Next question. Our next question on the line here is from a Dutch shareholder. "Mr. Chairman, do you believe Shell has enough support from governments around the world in order to be able to achieve the climate goals that have been set out in the transition strategy? If not, do you believe it is the responsibility of a large multinational conglomerate such as Shell to call on governments to provide clear conditions that can provide tangible guidelines for companies to act on, guiding longer-term efforts of such companies?" Question ends. Yeah, thank you for your very insightful question. We do engage extensively with governments, including making available our scenario planning information, which they found very useful in making their decisions. We stand ready to answer their specific questions about the energy system and do that frequently all around the world. We will be active in COP26 this fall with the next major United Nations gathering to focus on these topics. We'll, again, I think by supplying our information and answering their questions on what would be useful and not useful is the best way we can serve. We want to support governments in every way possible. Next question. The next question is from John Steven Betty. "Is Shell moving to enter good business relations with China to get access to and be able to mine its uniquely, as currently known, circa 250-million-year-old event, vast resources of rare earth metals, which are so valuable for modern technological trends, e.g. solar panels and batteries. What is Shell doing to develop their mining techniques to recover rare earth-containing nodules from the deep under the sea? Ben, could you talk about our plans to get in the mining business? Thank you very much, Mr. Bettai. Indeed, we believe that the future of mining is bright, and I'm not saying that to please my new boss. The truth of the matter is we have been in the mining business. At the time it was called Billiton, and it's now part of my new boss's former company. I do believe that we have to be very clear on where we focus our efforts. We believe that the energy system that we are currently participating in, particularly if you play it closer to the customer, is our best bet and closest to our existing competencies to make money and value out of the energy transition and to remain a relevant company. I fully agree with you that rare earths will have a very bright future, particularly because of the megatrends of the energy transition. Thank you. Next question. Next question is from Christian Donovan. I think that's a follow-up question as well. This investor has a serious concern that the company is being bullied between brackets by the green lobby into taking decisions that could potentially damage our company that have not been given serious thought and backed by reliable scientific data. Can the board reassure this investor that the board are simply not joining a bandwagon or are being bullied into taking actions by pressure groups? Thank you for your question, and I can assure you that we take every one of these decisions very seriously. As I described in my opening remarks, it was 18 months ago that we started the process to accelerate our strategy. It was a very thoughtful strategy based on science, based on understanding of how fast technology is developing. We will listen to many groups and hear their points of view. I can assure you, our shareholders, that we will take the steps that we think are in your best interest and society's best interest. Next question. There are three questions which have just come in from Neil Christopher Hamilton Longley. "Can you please reconsider the scrip dividend option that you ran in the recent past? You can then buy back shares to keep the share ratio constant. Will you consider reintroducing this given the fact that the loss of dividend income due to last year's massive dividend cut is unlikely to be recovered for many years at the current rate of increase?" Additionally, the current share price is still depressed after the poor absolute and relative performance over the last decade. The second question, did the cost of the acquisition of BG justify the price paid given the poor performance of the oil price between the announced and the completion of the transaction and the subsequent view taken on gas by the ESG lobby? The last question from Mr. Longley, will the board consider increasing returns of capital to shareholders given shareholder value is likely to be diminished by moves out of the areas of core competence such as E&P into electrical generation? Thank you. Thank you for your question, Jessica. I think all three of these have been addressed by you and your team. Could you comment on, please? Certainly. Thank you, Mr. Longley. In terms of the scrip dividend option, in general, I don't look favorably necessarily on scrip dividends from an overall shareholder perspective because it results in the dilution of our shareholder base. There are moments in time when it is an appropriate response given certain circumstances, but as a way of running the company, given the impact on the overall shareholder base, I would not look to scrip dividends as necessarily being a good lever for us to pull. There are other ways for shareholders to achieve those outcomes. You can choose to have your dividends reinvested. There's ways for investors to do that on their own. However, as a company, issuing equity in lieu of dividend has a dilutive effect, which I don't believe is ultimately in the interest of total shareholders and should be used as a last resort. I'd say that overall in terms of the performance of the company, which I think the last two questions speak to, I believe if you look at the performance over the last five years or so, what you see is a transformation of the company built off of the acquisition of BG. A reference point that I think is useful and helpful in this context is the total cash generated by the company. For the last three years or so, and if you just take last year, which was a pretty dramatic year for the entire sector, Shell generated some $34 billion in cash flow from operations based on the strength of its portfolio to a large extent, bolstered by the BG acquisition. That cash flow was some 50% higher than anyone else in the sector. I think that speaks to our absolute performance, which I think was impressive given the macroeconomic and societal circumstances that we're operating in. It's also a relative measure in terms of how we're doing relative to our peers who've also been investing substantially over the last several years, and yet if you look at our cash flow generation, if you look at our ROACE, we have moved to the top of the pack. Thank you. Next question. I have a question from Adam McKibbon. The UNEP 2020 production gap report shows oil and gas production must fall 4% and 3% per annum respectively from 2020 to 2030 in 1.5°C consistent scenario. Shell expects its oil production to fall by just 1%-2% per annum over that timeframe, although no firm commitment has been made, and it increases its focus on gas production. The company plans involve 65%-80% of CapEx being directed to oil, gas, and chemicals, and only 10%-15% to renewables and energy solutions, even less than marketing. Even beyond 2025, the planned CapEx breakdown is heavily weighted to hydrocarbons. This is more like business as usual than the transition strategy Shell is trying to frame as it is. What percentage of the shareholder vote would be necessary to make Shell produce a plan to reduce oil and gas production in line with the Paris climate goals? Ben, I'm going to ask you to address this overall question, but after this question is complete, I want to then turn to Andrew Mackenzie, not to answer this question. Andrew, your name's come up so many times today. I think our shareholders would like to hear a few comments from you about the new role you're taking on. I wanted to give you a heads up that question's coming. Ben, this one's over to you. Thank you very much. First of all, I think the question relates a little bit to the ongoing debate about what really should drive the energy transition. Are we going to move to a cleaner energy system by just withholding supply so that the economy customers will have no choice but to start using other products? Will it actually be the other way around where we use different types of energy and therefore companies, supply chains will have to supply a different type of energy. We believe in the fundamentals of the latter. If indeed the world is to tackle climate change, it will have to change the way it uses energy. That is not to say that we want to put the problem on the customers, but the reality is that it will only happen if indeed the appliances which use energy and make products or make convenience or make comfort or provide safety are going to be different. We will do everything we can to make sure that that transition happens and happens as fast as we can. We believe that we can be a very relevant, very profitable company serving a different type of energy system. Now, on the CapEx question, I believe that just tracking CapEx is not necessarily the best proxy to measure progress. The reason why I say that is by the way, also laid out in the report, but it is simply because the provision of oil and gas is a much more capital-intensive approach than a provision of, say for instance, renewable energy. We have to continuously work on oil and gas fields in order to keep the oil and gas coming, because they're empty all the time. We don't build wind farms where the wind dries up, and now we have to build another wind farm because there is no wind anymore. Sorry for being a little bit facetious, but that is one of the reasons why provision of energy from oil and gas is more capital-intensive than provision of renewable sources, and the operative word here is renewable. Moreover, we use different capital structures to work on these new value chains as well. In other words, while it is important that we change our investment profile as we change our business, it cannot be turned the other way around and say, "Let's track the investment as a proxy for seeing how successful we are in transitioning the business." If you want to measure progress, look at our net carbon footprint and look at where the cash flows are going to come from. That is the only way we believe you can credibly measure what we are doing. Thank you. Thank you, Ben. Andrew, the floor is yours. Okay. Thank you, Chad. Of course, I would like to say that it would be a privilege to be appointed chair of this great company when the votes come in, especially as we've seen from a lot of these debates this morning, the pivotal time that we're facing, not just as an industry, but as wider society. Clearly, I've dealt with a lot of these changes in my previous roles, and I'm looking forward very much to take on the honor, really, succeeding you, Chad. You've been a great chair of the board. I've admired you from afar and now quite close up, and I'm sure you'll be very warmly remembered. I was very fortunate to join the board really when the detail of putting together the Energy Transition Strategy, which forms the centerpiece of Resolution 20 was being put together. I was able to play, I think, my part in shaping it into such a compelling form in the way that it's come together. I do feel the company has an exceptional portfolio of future-facing opportunities that we'll have to choose from as we pull ourselves to the future that we've talked about or pull that future towards us. I'm really looking forward to being part of those choices and to working with the whole board, and causing the whole board to come together with Ben and his team so that we can accelerate Shell's transition to our net-zero emissions energy business that we believe is possible by 2050. I think in the process, we're going to continue to generate substantial value for our shareholders and for our communities and customers alike. I put customers last, not because they're least, but because I really believe that we should be driven by our customers' requirements and work from the customer back. They need to continue to enjoy many of the benefits of Shell's products and be able to flourish with them, but without anything like as much and hopefully no carbon attached. I think that's going to be an exciting journey to be on, particularly as many of the questioners have suggested in the next decade. I hope I can be part of that journey, and I look forward to it greatly. Thank you for giving me the chance to say something, Chad. Thank you, Andrew. I'd just like to reinforce one statement you made. You made major contributions to the strategy, and you got to work day one, literally day one, working on that. I've never seen more concentrated efforts to make a contribution. Thank you very much. Next question. Chad, we've got a question from Mrs. Hamstra-Pik, is a Dutch shareholder. How is Shell contributing to establish advanced recycling processes? What specific measures are taken to reduce and avoid plastic waste along the whole supply chain from suppliers into final consumer? Although I would love to take this one, I know it's so dear to our CEO's heart that I've got to let him answer the great work that's being done there. Thank you, Chairman. Thank you very much, Mrs. Hamstra-Pik. Indeed, it is close to me. That is also partly, of course, because I used to run our chemicals business. We have made quite significant progress in understanding how we can contribute to the problem of plastic waste and how we can improve recycling. First of all, let me talk about other parts of the business. We are working very hard to improve the percentage of recycled material in our own packaging products that we sell in our convenience stores or in other parts of the value chain. We aim to have 30% recycled material and in general, use just less packaging material for our products as well. At the same time, we are working very hard to also use recycled material in making petrochemicals. By 2025, we aim to have 1 million tons of feedstock made from recycled plastic going into our chemical processes to make new chemicals. We use a new process for that that will allow for that recycling of plastic. We will do that in the United States at this point in time, but also here in the Netherlands in Moerdijk. Finally, we are a member of the Alliance to End Plastic Waste, because we do believe that indeed plastic with its many benefits doesn't need to end up in our oceans. Therefore, we are working very hard with other players in the industry, where we have committed altogether $1.5 billion over the next 5 years to just deal with the problem of waste management that is causing this damage. Thank you. Next question. Mr. Chair, I have only a few questions left online, so if you allow me. This question is from Peter Jacobus Hubrecht de Pree. Is Shell interested in supporting nuclear electricity production in the Netherlands? That is so far afield from our core capabilities. We have considered it and seen that is not something we'll be pursuing. Next question. Question from Steven Derek Pullum. Can RDS guarantee that no hydrogen is extracted from RDS hydrocarbon assets? Ben, would you care to comment on hydrogen? Yeah. Thank you very much. We believe indeed the future of hydrogen is now here to take off. We believe that there are a number of forms of hydrogen that people have to use as clean hydrogen in order to deal with its demand. Of course, green hydrogen, there's a lot of talk about green hydrogen, so basically using renewable electricity to split water molecules into hydrogen and oxygen. We are already the operator of the largest electrolyzer in the world. We are aiming to build one that is 20 times as large here in Rotterdam, and we want to be a major player in the green hydrogen space. We also believe that if hydrogen, say for instance for transport, really takes off, that we probably need to have what is so-called blue hydrogen as well. That is hydrogen that is made from hydrocarbon resources, so natural gas for instance, but where the CO2 is captured and sequestered into geological formations. That blue hydrogen, I believe we cannot do without, certainly not in the near term, because if all the future hydrogen needs were to come out of green hydrogen, we would have to build an electricity system in the world almost as big as the current electricity system. That may well be the end game, but I don't think it will happen in the next few years or decades. Therefore, I do believe clean hydrogen should be green hydrogen, but also blue hydrogen. Thank you. Can you give us a feel for how many more questions are left on the line? I have online at this moment one last question from Mrs. Wensing. There are a few follow-up questions, but we will take them offline because they are very detailed. Okay. We will contact with both the VEB and the VBDO on some of those questions. That's already happening. The last question is from Ms. Wensing. She has asked a question earlier. The question is as follows: Question on behalf of Justicia Ambiental and Friends of the Earth Mozambique: In December 2020, a Shell spokesperson confirmed via email that it had canceled its gas to liquids plant in the Cabo Delgado. The spokesperson refused to provide information on Shell's other activities in the Cabo Delgado and instead referred us to Anadarko, which as you now know, no longer exists. The question is as follows: Does Shell still have any current or planned interest in Cabo Delgado and any agreements with any company in the gas industry in Cabo Delgado and/or with the Mozambican Government? If so, what are these interests and contracts for? Ben, could you take it, please? Yes. Thank you very much. Indeed, Mrs. Wensing, you're right. We have been very clear. We will not anymore invest in greenfield GTL projects, and that indeed does include Mozambique. Whereas a few years ago, we were still indeed looking at developing a gas to liquids project in the Cabo Delgado area. At this point in time, we have no interest in any activity in Cabo Delgado. We have no projects going on, and we at this point in time, also have no intention to continue to re-engage in GTL or other projects in that area. Thank you very much. There's still no further questions. There are no questions on the phone as I can see. I think we're ready to move into the next part of our meeting. We now have appeared to cover all the questions. Let me describe the voting procedure for you now. We'll move to this formal part of the meeting. Many of you have already sent in your proxy cards and do not need to vote again. As I mentioned earlier, voting has been open throughout the meeting and will remain open for 15 minutes following the conclusion of the meeting. If you are unsure how to vote, instructions are provided on page 23 of the notice of meeting. As a reminder, we took the notice as read earlier in the meeting. I will not be reading each one of the resolutions. Proxy votes submitted in advance of today's meeting amounted to 3.7 billion votes. A breakdown of the proxy results we've received will be shown on the screen. Let's see if we can show those final results now. I think on the first page are resolutions 1 through 14. Again, these are the proxy results that we saw, we had before the meeting. They do not count to the votes that are being administered at this point in time. You can see on the screen the% of votes for and% of votes against. If we can move to the second page. Again, these are resolutions 15 through 19. I'll give you a minute to take a look at the votes on those for and against. Let's move to the next page. These are the two climate-related proposals, 20 and 21, that's been discussed significantly at the meeting. I see there's 88.74% votes for the Shell Energy Transition Strategy, resolution 20. If I could comment, I thank our shareholders for what I see as a very strong showing of support for that resolution, and I'm assured your board and management team will take your show of confidence very strongly as we move forward. I also want to thank you for the tens of thousands of Shell people that will be so enlightened by this that they'll want to move forward. The final results of the polls, including the tally of the votes cast by shareholders attending online today, will be sent to Amsterdam and London stock exchanges, filed with the U.S. SEC, and shown on the Shell website tomorrow or perhaps even later tonight if time permits. Ladies and gentlemen, that brings us to the end of this meeting. I leave you and your voting. The polls will be open for 15 minutes after the close of the meeting. For clarity, if you sign off by closing the Lumi platform, please rest assured that your votes cast before the voting cutoff time will still be counted. Thank you. On that note, I formally declare the 2021 annual general meeting closed. Thank you for attending. Have a safe and great day.