The remuneration policy of SSPF meets all requirements of the Pensions Act and the Pension Funds Code and Regulation (EU) 2019/2088. These prescribe that pension funds pursue a controlled and sustainable remuneration policy that does not encourage them to take more risks (including sustainability risks) than are acceptable. The pension fund lays down the policy on remuneration in writing and makes it publicly available on the SSPF website.
Target Group of the SSPF Remuneration Policy
For SSPF, the rules surrounding the remuneration policy in the pensions sector apply to board members who do not work or no longer work for Shell. In practical terms, this specifically concerns members of the Board who have retired. The remuneration policy also applies to the members of the Supervisory Board (SB). Members of the Accountability Body (AB) statutorily do not receive remuneration. Members of the AB who no longer work for Shell are eligible for an untaxed expense allowance, which is capped by tax legislation.
Board members who are actively employed by Shell are bound by Shell's general employment conditions policy and do not receive any remuneration from SSPF. They are deemed to combine their board membership with their regular job. Therefore, there are no remuneration components that are used to take more risks (including sustainability risks) than are acceptable to the pension fund.
SSPF has fully outsourced the execution of the pension scheme and the asset management. This means the pension fund does not employ any staff. Shell Pensioenbureau Nederland (SPN) provides the administrative support for SSPF. SPN is a subsidiary of Shell and thus falls under Shell’s employment conditions policy. SSPF also ensures that the remuneration policy of parties to which tasks have been outsourced does not encourage them to take more risks than is acceptable for SSPF. The remuneration policy is an integral part of contract agreements when entering into or renewing an outsourcing contract. The outsourcing agreement between SSPF and Achmea Pensioenservices (APS) and between SSPF and Shell Asset Management Company (SAMCo) stipulates that both APS and SAMCo apply a remuneration policy to their employees that meets the rules for a controlled remuneration policy laid down by the Financial Markets Authority / Central Bank of the Netherlands (Autoriteit Financiële Markten / De Nederlandsche Bank).
Context for the SSPF Remuneration Policy
SSPF deals with remuneration responsibly, carefully and conservatively. All members of the Board within SSPF are in active employment at Shell, receive a Shell pension or (as former members) have the right to receive deferred pension entitlements. As such, SSPF does not compete with other pension funds (or with external financial service providers) when filling board positions. Members of the Board do not perform their work based on financial motivations, but rather on the basis of an intrinsic motivation such as broadening their own personal development, contributing to the retirement provision of (former) colleagues at Shell, etc.
The remuneration from SSPF for board members who are no longer in active Shell service is moderate. Furthermore, the Board stimulates that the board membership of persons in active Shell service is included in the annual assessment by the line manager of the staff member concerned. Matters such as personal development through their administrative role and positive cross-fertilisation with their daily job within Shell can play a role in this assessment.
For members of the Supervisory Board, market conformity is the starting point when determining the remuneration policy. After all, members of the SB are external pension professionals who (possibly) fulfil a role at various pension funds and financial institutions.
Criteria for remuneration of SSPF Board members and Supervisory Board
Within the framework of the statutory requirements for a controlled remuneration policy, the Board of SSPF has established the following criteria regarding the members of the Board and the Supervisory Board to whom the remuneration policy for pension funds applies:
Board members not (or no longer) employed by Shell
- The remuneration policy is in line with the objectives of SSPF and is appropriate considering the scale and organisation of the fund and the nature, complexity and reputation of the Shell company for which the fund administers the scheme. Remuneration policy does not include any remuneration components that encourage (increased) risk-taking – in areas including sustainability. A market study is used to determine the remuneration.
- The remuneration and/or any (expense) allowance is in reasonable proportion to the responsibility borne, the (suitability) requirements set for the position and the time commitment. The statutory FTE score is used as the starting point for determining the time commitment.
- In the event of premature dismissal, no redundancy payment will be provided by SSPF.
- There will be no remuneration and/or (expense) allowance that are related to SSPF's financial results. This also means that there is no negative incentive effect involved.
Member of the SB
- The above criteria for board members who are not (or no longer) employed by Shell apply by analogy to members of the Supervisory Board. Furthermore, the following additional criteria apply to members of the Supervisory Board:
- The level of remuneration is such that a financial interest in no way impedes taking a critical stance.
- There is no question of performance-related remuneration.
- The remuneration is in line with the market.
As regards parties to which SSPF has outsourced activities, the following applies:
- SSPF involves the remuneration policy in the choice of third parties to which the pension fund has outsourced activities. The remuneration policy of these parties at least meets the criteria of SSPF's own remuneration policy.
- In the event that the general principles of SSPF's remuneration policy do not apply to the outsourcing partner due to legal exceptions, the outsourcing partner in question shall provide SSPF with insight into the remuneration policy so that the pension fund can establish that the policy does not encourage unacceptable risks to be taken.
Every three years, the Board evaluates the remuneration policy to determine whether it still meets the formulated objectives and principles. The Board periodically reviews the individual remuneration determined according to this remuneration policy.
Based on an evaluation, the Board has updated the remuneration policy and has adopted it again on 4 March 2021.