Royal Dutch Shell Group .com
The Times: Veteran of Shell learns to
float above many a boardroom crisis: Maarten van den Bergh has survived
troubled times at the top of some of Britain's leading companies: "Royal
Dutch Shell, where he now sits as a non-executive director, where he was
president until 2000 and where he began his career in the late 1960s, was
forced to admit almost two years ago that it did not have as much oil as it
thought it had. The subsequent revisions showed that its system of auditing
reserves, for which the board had ultimate responsibility, was in complete
disarray.":
Wednesday 9 November 2005
By Suzy Jagger
Maarten van den Bergh
BY
THE the law of averages, if you hang around at a company long enough you’ll
have to deal with a crisis sooner or later, according to Maarten van den
Bergh. Even with his economics degree, however, the Dutchman’s understanding
of probability has led to an underestimate.
All four of the British companies where he holds a board position have
suffered crises — although not all within his control.
Royal Dutch Shell, where he now sits as a non-executive director, where he
was president until 2000 and where he began his career in the late 1960s,
was forced to admit almost two years ago that it did not have as much oil as
it thought it had. The subsequent revisions showed that its system of
auditing reserves, for which the board had ultimate responsibility, was in
complete disarray.
BT was hardly plain sailing. Mr Van den Bergh had the unenviable task of
ascertaining whether to beg existing (and grumpy) shareholders for another
£5.9 billion — the biggest rights issue in history — at a time when BT was
in turmoil. To its credit, in 2001 the company pulled it off. But while half
the plan proved to be a great success, that is demerging the mobile phones
arm, BT’s own share price has continued to struggle.
To add to his litany of woes Mr Van den Bergh took a non- executive seat on
the British Airways board in 2002 just as it had emerged from the impact of
foot-and-mouth, the suspension of Concorde and the September 11 terrorist
attacks. While the stock has performed adequately, difficult, unresolved
relations with unions and the oil price are likely to inhibit any strong
recovery in the future.
Mr Van den Bergh is also on the board of Lloyds TSB, arguably the weakest of
Britain’s high street clearing banks, where he was promoted from deputy
chairman to chairman in 2001. While Lloyds TSB shares enjoy the highest
yield in the FTSE 100, since 2000, when he joined, the stock has fallen from
774½p to 471p yesterday, dogged by the group’s failure to compete with HBOS.
Lloyds TSB finally took the view that the cut-throat market in the UK was a
good place to be. The jury’s still out on this. Meanwhile, international
banks, such as HSBC and Royal Bank of Scotland, are thriving. The
precipice-bond mis-selling scandal, for which the bank had to pay out £200
million in fines and compensation, was hardly his finest hour.
Mr Van den Bergh, though, is philosophical about corporate crises. “No
company is always on a winning streak. There are always difficult times.
Problems are not unique to any company,” he says. “I have enjoyed all four
of them fantastically. They have been full of challenges. You just have to
try and do the job as best you can, and get the best advice.”
So what type of chairman is Mr Van den Bergh? “I am very hands-off. I have
an open-door policy. I see between 25 and 40 top people within each firm on
a monthly basis. I try to be a strong leader of the board. I don’t try to
interfere.”
While investors in Shell may wish that he had interfered a bit more, to be
fair the business environment in which directors operate in the UK has
become much more demanding. As Mr Van den Bergh sees it: “The pressure on
boards has really increased. The amount of interference has really
increased, from all kinds of people — the government, consumer groups,
regulators. What’s important is to find a balance, to not overreact.”
Alongside the increasing visibility and accountability, Mr Van den Bergh has
another burden to bear: sitting on the BT pension scheme performance review
group. As a function of sliding equity returns and increased life
expectancy, BT, like many corporate pension schemes, is nursing a scary
deficit: £4.8 billion (on an FRS 17 basis) and the biggest in the UK.
“The problems of pension schemes, their funding, their investments, used to
be just an issue for actuaries. Now that companies are taking the deficits
on to their balance sheets means that companies which may have been very
lightly geared suddenly find themselves in a very different financial
position. The pension scheme can change a company’s whole risk profile. You
just have to be very careful to take a mature view.”
At the age of 63, it will not be long before Mr Van den Bergh will be
looking towards retirement, but he will not be returning to the Netherlands.
“I have many friends here,” he says fondly.
CURRICULUM VITAE
Born in New York in 1942, but retained Dutch nationality. Grandson of a
margarine magnate, whose company was sold to Unilever in 1927. Joined Royal
Dutch Shell in 1968
Learnt to speak Japanese in Sheffield and was sent to Japan by Shell for two
years. Sent to Venezuela, and into the oil company’s treasury department,
before going to Indonesia. In 1979 became vice-president of the Pilipinas
Shell Petroleum Corporation
Held a variety of posts in Thailand and Africa before becoming group
managing director of Royal Dutch Shell Group in 1992
From 1998 to 2000, vice-chairman of the committee of managing directors. He
insists he is an international businessman, but holds a degree of scepticism
for Europe, where there are so many commissioners with “agendas”
Adviser to Hong Kong Government after it was handed back to the Chinese
In 2000 joins boards of BT and Lloyds TSB. Joins BA board in 2002.
Currently, non-executive director of Royal Dutch Shell
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