The British and Dutch parent companies of Royal Dutch/Shell are to merge. The twin board structure will be scrapped as part of an effort to restore investor confidence. That was dented when it was discovered that Shell’s oil and gas reserves had been hugely overestimated. In an arrangement going back 100 years, currently 60% is owned by the Royal Dutch Petroleum Company and 40% by the Shell Transport and Trading Company.The new unified company will have its primary share listing in London and its headquarters in the Netherlands. The decision to merge follows pressure from investors who had criticised the old structure as lacking transparency and accountability. The former chairman of the twin-headed group, Jeroen van der Veer, will be the chief executive. He addressed that concern when he said: “The words clarity, simplicity, efficiency and accountability.. I think they should be embedded in our culture of ‘Enterprise First’.” As it announced the new structure Royal Dutch/Shell unveiled a 70% jump in third quarter profits. But the company also said another 900 million barrels of reserves might have to be removed from its 2003 accounts. This follows the revelation in January that it had overstated its oil and gas reserves by 20%.
Royal Dutch and Shell to become one