Understanding and engaging with our stakeholders

The Board continues to value and recognise the importance of engagement and cooperation with our stakeholders. Time is dedicated to listening to different stakeholder views and our commitment to stakeholder engagement is built upon the understanding that knowledge-sharing, widening of experiences and adopting a learner mindset will help us achieve our commercial, environmental and social objectives.

The Board remains grateful for the engagement opportunities it has had, including the 2023 AGM.

The Directors have continued to consider stakeholders' views in Board discussions and decision-making, as described in the "Section 172(1) statement" section.

Engagement with our stakeholders also goes beyond the Board and is continuous. Our broader businesses regularly engage with stakeholders throughout the year, and in the build-up to or during many Shell projects, activities, acquisitions and divestments. This engagement is often governed by formulated policies, control frameworks, regulation and legislation. It may differ by region.

Site visits

The Chair, certain Board committees and Non-executive Directors traditionally visit several Shell operations and overseas offices in a given calendar year. The objective of these visits is to provide the Directors with local context and deepen their understanding in the following ways, where relevant:

• provide insights into asset operations and portfolio positions;
• opportunity to engage directly with stakeholders, including staff, business partners, communities;
• improve the Board's oversight of top risks; and
• assess the Company's culture first-hand.

Visits provide a good opportunity for Board members to engage with each other and, in 2023 in particular, with three new Board members, the visits formed an important part of their induction.

Shareholders

The Chair, the Deputy Chair, the CEO, the CFO and the Executive Vice President Investor Relations each meet regularly with major shareholders and report the views of such shareholders to the Board. Committee chairs also seek engagement with shareholders on significant matters related to their areas of responsibility. During the year, Sir Andrew Mackenzie, in his capacity as Chair, met with more than 50 major shareholders, including during four days of roadshows. A variety of topics were discussed with the Chair, including performance, capital discipline and simplification of Shell; governance and Board priorities; and the Company's role in the energy transition. In the early part of the year, the REMCO Chair met with over 25 shareholders and discussed 2022 pay outcomes and remuneration policy changes ahead of the 2023 AGM.

Shareholders can contact Shell directly via the "Contact us" section of the Shell website. This allows investors' questions to be directed to the appropriate Shell team that can assist. Shareholders are also able to make use of our automated question response tool. Investors can also access information via the frequently asked questions section of the Shell website.

The Shell website also provides contact details for our Registrar, Equiniti, shareholder queries, our media team, requests for copies of the Annual Report, and general customer enquiries.

The Company's Registrar operates an internet access facility for registered shareholders, providing details of their shareholdings. Facilities are also provided for shareholders to lodge proxy appointments electronically. The Corporate Nominee service, facilitated by Equiniti, provides a facility for investors to hold their shares in the Company in paperless form.

Shareholder engagement on AGM resolutions

At the 2023 AGM, shareholders voted on two climate-related resolutions: (i) Resolution 25, which was an advisory vote on Shell's Energy Transition Progress – shareholders showed strong endorsement, with 80% of shareholders who voted casting votes in favour of our progress; and (ii) Resolution 26, a shareholder resolution, submitted by an organisation called Follow This on behalf of a small group of shareholders. The resolution from Follow This was broadly unchanged from their 2022 submission, which was also rejected by shareholders, as its variations have been every year since first being submitted in 2016. The resolution urged Shell to align its medium-term carbon emissions reduction targets with the Paris Climate Agreement, including emissions from fuels burnt by consumers, known as Scope 3 emissions. We remain committed to constructive engagement with our shareholders, and we believe our climate targets are aligned with the more ambitious goal of the Paris Agreement. The Board believed the proposal from Follow This was not in the best interest of the Company and its shareholders as a whole. Resolution 26 received support from 20% of shareholders who voted. Shell is aware that some shareholders voted in support of both Resolutions 25 and 26, despite their conflicting content.

In 2023, the Chair, CEO and CFO hosted meetings with some of our large shareholders. These meetings covered many topics. We recognise and value the importance of stakeholder engagement when considering our energy transition progress. The Board is grateful for the time and contribution of all those stakeholders who provided feedback, and for the overall indications of support for Shell's strategy.

Following the AGM, we engaged with our largest shareholders offering further opportunities to discuss the progress made against Shell's energy transition strategy and to understand the reasons behind various voting decisions. The Chair subsequently had an opportunity to engage directly with our large institutional shareholders during his roadshow in September 2023.

These discussions showed that our large shareholders that did not vote in line with the Board recommendation on Resolution 25 and Resolution 26 were predominantly focused on Shell's energy transition strategy and not the 2022 progress, to which Resolution 25 related. Some shareholders continue to outline societal pressure influencing media coverage and expectations from beneficial owners as reasons for not aligning with the Board recommendation. Others raised questions related to medium-term targets, including a desire for a Scope 3 absolute emissions target.

This feedback was added to the ongoing internal considerations of the Company's climate targets, along with the outcome of the Dutch court case, the Powering Progress strategy, Capital Markets Day, and the commitments that Shell had made within its energy transition strategy.

Engagements in 2023

Information on engagements the Board has held during the year is summarised below. Information on engagement with other stakeholders including the workforce is provided in section "Workforce engagement". The way in which stakeholder interests were considered in principal decision-making by the Board in 2023 (Section 172 statement) can be found in "Section 172(1) statement". Further insight into our engagement with stakeholders can be found within our Sustainability Report, scheduled for publication in March 2024.