UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. )___)
Filed by the Registrant | Filed by a Party other than the Registrant |
Check the appropriate box: | |
Preliminary Proxy Statement | |
Confidential, for Use of the Commission Only (as permitted by Rule | |
Definitive Proxy Statement | |
Definitive Additional Materials | |
Soliciting Material under §240.14a-12 |
SCHLUMBERGER N.V. (SCHLUMBERGER LIMITED)
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check | ||
No fee | ||
Fee paid previously with preliminary materials | ||
Fee computed on table | ||
Notice of 2023 Annual General Meeting of Shareholders |
Notice of 2022 Annual General Meeting of Stockholders
1. | Election of 11 director nominees. | |||
2. | Advisory vote on the frequency of future advisory votes on executive compensation. | |||
3. | Advisory “say-on-pay” approval of our executive compensation. | |||
Approval of certain annual financial statements for the year ended December 31, | ||||
Ratification of the appointment of our independent auditor, PricewaterhouseCoopers LLP. | ||||
Such other matters as may properly be brought before the meeting. | ||||
By order of the Board of Directors, | ||||
Dianne B. Ralston | ||||
Chief Legal Officer and Secretary | ||||
February |
Wednesday, April 6, 20225, 2023
10:00 a.m. Curaçao time
Curaçao Marriott Beach Resort, John F Kennedy Boulevard, 3 Piscadera Bay, Willemstad, Curaçao
RECORD DATERecord Date
February 8, 2023
February 9, 2022
HOW TO CAST YOUR VOTE
How to Cast Your Vote
Please refer to the enclosed proxy materials or to the information forwarded by your bank, broker, or other nominee to seedetermine which voting methods are available to you. StockholdersShareholders with shares registered in their names with Schlumberger’sSLB’s transfer agent may authorize a proxy:
By Internet |
By Telephone | |||
By Mail |
If you are a beneficial holder of SchlumbergerSLB common stock, you should follow any instructions provided by your bank, broker, or other nominee. See “Meeting Information” in this proxy statement.
PROXY VOTINGProxy Voting
Your vote is very important. Whether or not you plan to attend the annual general meeting in person, please (i) sign, date, and promptly return the enclosed proxy card in the enclosed envelope, or (ii) grant a proxy and give voting instructions by telephone or internet, so that you may be represented at the meeting. Voting instructions are provided on your proxy card or on the voting instruction form provided by your broker.
Brokers cannotare not permitted to vote on Items 1certain proposals and 2 withoutmay elect not to vote on any of the proposals unless you provide voting instructions. Voting your instructions.shares will help to ensure that your interests are represented at the meeting.
IMPORTANT INFORMATION REGARDING MEETING ATTENDANCEImportant Information About Meeting Attendance
Depending on the level of COVID-19 protocols in effect at the time, your ability to attend the 20222023 Annual General Meeting of Stockholders (“Shareholders (the 20222023 AGM”) in person may be restricted or may require additional safeguards, which could include face coverings, proof of vaccination, proof of a negative COVID-19 test result within a specified number of days, and maintaining appropriate social distancing. Please review www.proxydocs.com/SLBfor any updates to the “Meeting Information” section of this proxy statement prior to traveling.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL GENERAL MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 6, 2022:Important Notice Regarding the Availability of Proxy Materials
for the Annual General Meeting of Shareholders to be Held on April 5, 2023
This Notice and Proxy Statement, our Annual Report on Form 10-K for the fiscal year ended December 31, 2021,2022, and our 20212022 Annual Report to StockholdersShareholders are each available free of charge at https://investorcenter.slb.com and www.proxydocs.com/SLB.
3 |
This summary highlights information contained elsewhere in this proxy statement, but it does not contain all of the information thatis provided for your reference. However, before voting, you should consider. You should readcarefully review this entire proxy statement carefully before voting. In addition, we are providingand, particularly with respect to agenda Item 4, our 20212022 Annual Report to Stockholders concurrently with this proxy statement. You should refer to its contents in considering agenda Item 3.Shareholders.
All references in this proxy statement to “SLB,” “the Company,” “Schlumberger,” “we,” or “our” are to Schlumberger Limited (Schlumberger N.V.) and its subsidiaries.
Website references throughout this document are provided for convenience only, and the content on the referenced websites is not incorporated by reference into this document.
This proxy statement is first being made available to our stockholdersshareholders on or about February 24, 2022.23, 2023.
The 20222023 AGM will be held at the Curaçao Marriott Beach Resort, John F Kennedy Boulevard, 3, Piscadera Bay, Willemstad, Curaçao, on Wednesday, April 6, 2022 beginning at 10:00 a.m., Curaçao time.at:
Meeting Date: | Wednesday, April 5, 2023 |
Place: | Curaçao Marriott Beach Resort John F Kennedy Boulevard, 3, Piscadera Bay Willemstad, Curaçao |
Time: | 10:00 a.m. Curaçao time |
Record Date: | February 8, 2023 |
Each stockholdershareholder of record at the close of business on February 9, 20228, 2023 (the “record date”) is entitled to one vote for each share registered in such stockholder’sshareholder’s name. If your shares are registered in your name with Schlumberger’sSLB’s transfer agent, you may vote in person at the 20222023 AGM, or you may authorize a proxy to vote your shares by one of the following methods:
By Internet |
| By Telephone (866) 240-5191 |
| By Mail Sign, date, and mail your proxy card |
If you are a beneficial owner of SchlumbergerSLB common stock (i.e.i.e., you hold your shares on the record date through a broker, bank, or other nominee), you should follow the voting instructions provided by your bank, broker, or other nominee.
If you plan to attend the 20222023 AGM in person, see “Meeting Information” beginning on page 6867 for the requirements for admission to the meeting. Whether or not you plan to attend the 20222023 AGM in person, please (i) sign, date, and promptly return the enclosed proxy card in the enclosed envelope, or (ii) grant a proxy and give voting instructions by telephone or internet, so that you may be represented at the meeting.
Item | Our Board’s Recommendation | Vote Required for Election / Approval | Page Reference (for more detail) | |||
1 | Election of 11 director nominees. | FOR each nominee | Majority of votes cast for the nominee | 11 | ||
2 | Advisory “say-on-pay” approval of our executive compensation. | FOR | Majority of votes cast | 30 | ||
3 | Approval of our consolidated balance sheet at December 31, 2021, our consolidated statement of income for the year ended December 31, 2021, and the declarations of dividends by our Board in 2021. | FOR | Majority of votes cast | 65 | ||
4 | Ratification of the appointment of PricewaterhouseCoopers LLP (“PwC”) as our independent auditor for 2022. | FOR | Majority of votes cast | 66 | ||
Item | Our Board’s Recommendation | Vote Required for Election / Approval | Page Reference (for more detail) | |
1 | Election of 11 director nominees to our Board of Directors (the Board). | FOR each nominee | Majority of votes cast for the nominee | 10 |
2 | Advisory vote on the frequency of future advisory votes on executive compensation. | ONE YEAR | Majority of votes cast | 29 |
3 | Advisory “say-on-pay” approval of our executive compensation. | FOR | Majority of votes cast | 30 |
4 | Approval of our consolidated balance sheet at December 31, 2022, our consolidated statement of income for the year ended December 31, 2022, and the declarations of dividends by our Board in 2022. | FOR | Majority of votes cast | 64 |
5 | Ratification of the appointment of PricewaterhouseCoopers LLP (PwC) as our independent auditor for 2023. | FOR | Majority of votes cast | 65 |
2023 Proxy Statement |
2021 was an exceptional year for Schlumberger, in which we demonstrated the strength and agility of our emergent strategy—rooted in operational execution, superior returns, and capital discipline. After two years of extraordinary industry, market, and social uncertainty, the Schlumberger team delivered a year of remarkable financial results, surpassing all of our 2021 financial targets and closing the year with excellent momentum.
Highlights of our 2021 financial performance, reflecting the success of our returns-focused strategy and execution, include:
Peter Coleman Former CEO and Managing Director Woodside Petroleum Ltd. | Patrick de La Chevardière Former Chief Financial Officer Total S.A. | Miguel Galuccio Chairman and CEO Vista | Olivier Le Peuch Chief Executive Officer SLB | |
Samuel Leupold Former Chief Executive Officer Ørsted Wind Power A/S | Tatiana Mitrova Research Fellow SIPA Center on Global Energy Policy Columbia University | Maria Moræus Hanssen Former Deputy CEO and COO Wintershall Dea GmbH | Vanitha Narayanan Former Chairman and Managing Director IBM India | |
Mark Papa Former Chairman and CEO Centennial Resource Development | Jeff Sheets Former EVP and CFO ConocoPhillips | |||
|
|
| ||
|
|
| ||
CEO ABB Ltd. |
On the strength of these financial results, driven by excellent operational leverage as a result of our Performance Strategy and strong working capital management, we were able to reduce our net debt to adjusted EBITDA ratio from 3.2x to 2.2x year-on-year. At the same time, we achieved double-digit pretax operating margins in North America—the highest levels since 2014—and we expanded our international pretax operating margins to the highest levels since 2018.
The success of 2021 was built upon the continued growth of our strategic business pillars—strengthening our core, digital, and new energy—to deliver high performance sustainably.
In our Core business, we fully operationalized our returns-focused strategy through our new Division and Basin organization and high-graded business portfolio, which have significantly increased our operating leverage. As a result of our differentiated capabilities, exceptional execution, and technology performance, we enhanced our market positions and won significant project awards during the year. With increased operating leverage and our outstanding customer performance, we ended the year marking six consecutive quarters of pretax segment operating margin expansion.
In Digital, we expanded market access and accelerated the adoption of our platform, which brings our customers AI capabilities and powerful digital tools to reduce cycle time, improve performance, and lower carbon intensity. We built partnerships to achieve comprehensive cloud access globally, collaborated with AI innovators to deploy machine-learning and AI solutions, and enabled digital operations through the automation of key workflows in well construction and production operations.
In Schlumberger New Energy, we continued to advance the development of clean energy technologies and low-carbon projects. In 2021, we invested in stationary energy storage—expanding our total addressable market—and progressed our ventures in hydrogen, lithium, geoenergy, and a suite of carbon capture, utilization, and storage (“CCUS”) opportunities, including our bioenergy carbon capture and storage (“BECCS”) project.
2021 also saw continued excellence in Safety and Service Quality, as we successfully navigated the challenges of the ongoing pandemic to ensure continued execution and performance for our customers. Our total recordable injury frequency showed a 31% improvement since 2019, and we also improved our automotive accident rate by 30% compared to 2019. Furthermore, our service quality performance was the best on record, despite increasing activity coupled with ongoing pandemic and supply chain challenges.
This was also a pivotal year for Schlumberger’s commitment to Sustainability. We announced our comprehensive 2050 net-zero commitment inclusive of Scope 3 emissions—a first for the energy services sector—and we launched our Transition Technology* portfolio to focus on the decarbonization of oil and gas operations. In addition, Schlumberger earned an upgraded AA rating from MSCI, and won an ESG Top Performer award from Hart Energy, recognizing our sustainability efforts, our enhanced disclosures, and our commitment to apply our technologies and capabilities toward helping the world sustainably meet future energy demand.
In summary, 2021 was a defining and transformative year for Schlumberger. We continued to strengthen our core portfolio, while also enhancing our sustainability leadership, advancing our digital journey, and expanding our new energy portfolio.
As we enter 2022, Schlumberger is well prepared to seize the multiyear growth cycle ahead of us. We have entered this cycle in a position of strength, having reset our operating leverage, expanded peer-leading margins across multiple quarters, and aligned our technology and business portfolio with the new industry imperatives. We are truly excited about the outlook for Schlumberger—for continued financial outperformance, technology leadership, and growth opportunities in digital and clean energy innovation—to enable the world to unlock access to energy for the benefit of all.
|
|
|
| |||
|
|
|
| |||
|
|
|
Comprehensive risk assessment process designed to identify and manage enterprise-wide risks Proactive shareholder engagement |
Non-employee director tenure limits of 75 years of age or 10 years of service—whichever comes first
|
5 |
Our BoardA global technology company that drives energy innovation for a balanced planet
2022 was transformative for SLB. We launched our bold new SLB brand identity—reinforcing our leadership position in technology, digital, and sustainability in the energy industry—and we demonstrated our ability to deliver superior earnings in this early phase of Directors (the “Board”) is committed to thoughtful board refreshmenta structural upcycle in energy. We set new safety, operational, and ongoing board succession planning. Allperformance benchmarks for our customers and strengthened our market position both internationally and in North America.
Highlights of our director nominees joined2022 financial performance(1) include:
Grew revenue 23% year on year | Grew GAAP earnings per share (EPS) by 81% year on year | Expanded income before taxes margin to 15.2% | Strengthened balance sheet by reducing both gross and net debt by $1.7 billion | |||||
Increased dividend 40% in April 2022 43% in January 2023 | Grew EPS, excluding charges & credits, by 70% year on year | Expanded adjusted EBITDA margin to 23.0% | Ended 2022 with1.4x net debt to adjusted EBITDA ratio—lowest level since 2016 | |||||
In 2022, we executed our strategy across our Three Engines of Growth—our Core, Digital, and New Energy—and successfully leveraged the Board withinbreadth of our portfolio and our competitive strengths to deliver peer-leading outcomes for our customers and shareholders.
In our Core Divisions, we expanded pretax segment operating margins and launched new products, services, and solutions that increase efficiency and lower operational emissions. Our fit-for-basin, technology access and Transition Technologies* portfolios fueled growth and margin expansion in every Division in 2022. And we continue to strengthen our Core portfolio for growth and position for future resilience and shareholder returns through strategic initiatives such as the announced subsea joint venture with Aker Solutions and Subsea 7. | In Digital, we had strong growth in exploration data, Innovation Factori* and artificial intelligence solution sales, and the adoption of our new digital technologies is accelerating. We ended the year with more than 70% growth in Delfi* users, and our software-as-a-service (SaaS) revenue more than doubled. We continue to build adjacent expansion opportunities for our digital business, both in the operations data space and beyond oil and gas, such as carbon management. | In New Energy, we progressed technology development milestones, established new partnerships, and made new investments to develop a focused, yet comprehensive portfolio that offers promising growth opportunities for the future. Today, this portfolio comprises five business areas: carbon solutions, hydrogen, geothermal and geoenergy, critical minerals, and stationary energy storage. We are also accelerating our R&D efforts to develop technology solutions that address hard-to-abate industrial and power generation emissions. | ||
In Sustainability, we reduced our Scope 1 and 2 carbon emissions intensity as compared to 2021. We also launched several new Transition Technologies to support the last five years, bringing diversedecarbonization of oil and evolving experiencegas, as well as our SLB End-to-end Emissions Solutions (SEES) methane elimination business.
We also advanced our technology leadership, safety and leadership skillsoperations integrity performance, and service quality differentiation, leading to more contract awards, higher technology adoption, and increased pricing premiums.
Finally, we demonstrated our commitment to Superior Shareholder Returns. We increased our dividend by 40% in areas thatApril 2022, followed by a further 43% increase in January 2023, and we resumed our share buyback program in January 2023.
Looking to 2023, we believe the market fundamentals are strategically important toaligned with what we do best—innovating and outperforming for our customers. With our bold new brand and identity founded on technology and innovation, our strategy with sustainability at its heart, and our strong financial and operational results through the Company. The chart below reflects someearly phase of the key skillscurrent upcycle, we believe we have set a very solid foundation for strong performance and experience ofshareholder value creation in 2023 and into the non-employee directors who joined the Board over the past three years, offering continuing expertise in our core industry and operations, while enhancing expertise in financial and capital management, sustainability, new energy, and digital technologies and transformation. For further information on each director nominee, see “Election of Directors” beginning on page 11 of this proxy statement.next decade.
(1) | For definitions of adjusted EBITDA, adjusted EBITDA margin, free cash flow, free cash flow margin, EPS excluding charges and credits, and net debt, as well as reconciliations of these non-GAAP measures to their most comparable GAAP measures, see Appendix A. |
* | Mark of SLB |
6 | 2023 Proxy Statement |
Global Perspectives. The
As a leading global technology company, with a workforce consisting of approximately 99,000 people in more than 100 countries, one of SLB’s greatest strengths is the diversity of our people. We believe that our ability to attract, develop, motivate, and retain a highly competent and diverse workforce has long been one of Schlumberger’s greatest strengths. Our employees represent more than 160 nationalities and have experience in more than 120 countries.paramount to our success for many decades. We recognize that cultivating diversity and promoting inclusion are not just the right thing to do—they are essential to attracting the best talent from around the world and enabling creativity and innovation to drive business success.
As a global company focused on creating value forOur national and cultural diversity is based in our customers, we believe it is critical for ourphilosophy to recruit and develop people to communicate with our customers in their native languages and to sharefrom the values of the people in the countriescommunities where we work. Furthermore, our diverse workforce positions us to effectively deliver services and products that meet the unique expectations and requirements of our stakeholders, including our customers, suppliers and stockholders. We have continued toAs a result, we maintain a workforce nationality mix aligned to the revenue derived from the countries in which we work, as reflected in the charts below. Our long-standing commitment to national and cultural diversity, which is seen throughout every layer of SLB—including our executive team and the Board—fosters a culture that is global in outlook, yet local in practice. Our nationally and culturally diverse Board and 10-member executive leadership team collectively represent 14 nationalities across six continents.
In addition our geographically diverse Boardto nationality and 10-member executive team (as of December 31, 2021) collectively represented 15 nationalities across six continents, as reflected on the map below.
Gender. Gendercultural diversity, gender balance is anotheran important pillarpart of our diversity, equity, and inclusion strategy. We are committed to leadleading our industry in gender diversity, and we are on track to reach our interim milestone of having women compriserepresent 25% of our salaried employee populationemployees by 2025. In 2021, we set ourOur next milestone to continue our progress—is for women to comprise 30% of our salaried employee populationemployees by 2030. This target includesOur 2025 and 2030 targets include executive roles and all other salaried positions.
As of December 31, 2021, women made upWomen represent 30% of our executive team and approximately 22%as of management-level roles. Approximately 18% of our total workforceJanuary 31, 2023, and 23% of our salaried employee population were women at year-end 2021. Women also represented approximately 48% of our 2021 new hires for salaried roles with science, technology, engineering and mathematics (STEM) backgrounds. For the 2022 AGM, women represent 27% of our director nominees.nominees for the 2023 AGM. Approximately 19.5% of our company (excluding contractors) and 23.8% of our salaried employees were women as of December 31, 2022.
2021 WOMEN IN LEADERSHIP | |
27% | 30% |
Director Nominees | Executive Team |
22% | 48% |
Management-Level Roles | New STEM Hires |
Race and Ethnicity. As a truly global company with a rich legacy of national and cultural diversity, it is important that we do not limit our definitions of racial and ethnic diversity to the common classifications used in the United States, both for our executive team and for the Board. For further discussion regarding the racial and ethnic diversity of our Board, see “Election of Directors—Director Qualifications and Diversity” beginning on page 1110 of this proxy statement.
7 |
In November, we held our 2022 Investors Conference in New York City, USA as a platform to demonstrate SLB’s potential to deliver differentiated growth and returns over the next few years. The conference was focused on SLB’s strategies to advance Energy Innovation, Lower Carbon and Higher Value within the context of today’s global energy dynamics, which require bold new technologies and ideas, digital transformation and a deep commitment to sustainability. The conference also included a series of technology immersion sessions showcasing our leadership and key offerings in our Core, Digital and New Energy.
From left to right: SLB executive leadership team members Gavin Rennick, Dianne Ralston, Demosthenis Pafitis, Olivier Le Peuch, Rajeev Sonthalia, Stephane Biguet, Katharina Beumelburg, Khaled Al Mogharbel, Carmen Rando Bejar, and Abdellah Merad.
As more fully discussed in the “Compensation Discussion and Analysis” section of this proxy statement:
• | Diversified LTI Program Structure — Our NEOs continued to receive a mix of long-term incentive (LTI) grants in 2022, with 75% of their target LTI opportunity awarded in the form of performance share units (PSUs), and 25% | |
• | Rigorous PSU Performance Targets — In setting LTI performance targets for 2022, the Compensation Committee emphasized and encouraged ambitious outperformance by increasing the maximum performance goal for the FCF margin PSUs as compared to 2021, and continuing to set an above-median target performance goal for the TSR PSUs. In addition, based on shareholder feedback, the Committee adjusted the comparator group for our TSR PSUs to include our direct competitors and the S&P Global 1200 Energy Index, to focus on TSR outperformance relative to our direct competitors while expanding the group to include the broader energy market. |
• | Performance-Aligned Incentive Payouts — Our NEOs’ short-term incentive (STI) payouts were based on strong 2022 adjusted EBITDA results, partially offset by below-target 2022 free cash flow results, and their LTI payouts were based on exceptional multi-year ROCE and free cash flow conversion results. |
Short-Term Incentive Results | Long-Term Incentive Results | |
• Average NEO Payout — 80% — Our NEOs earned an average 2022 cash incentive payout of 80%. • Adjusted EBITDA Payout — 157% — Our 2022 adjusted EBITDA(1) was $6.462 billion, representing a • Zero FCF Payout — Our 2022 free cash flow(1) of |
• Our CEO did not receive an LTI award in 2020 and therefore did not earn any 2020 PSUs. • For our other NEOs, the 2020 LTI payout was based on: (i) SLB’s average annual ROCE for the three-year performance period, which was 407 basis points (bps) above the average ROCE of the comparator group, (ii) SLB’s absolute 2022 ROCE of 13%, and (iii) SLB’s cumulative FCF conversion rate of 192% from 2020 to • As a result, our NEOs, other than our CEO, earned 250% of the target shares of SLB stock under the 2020 PSUs. |
(1) | For reconciliations of adjusted EBITDA and free cash flow |
8 | 2023 Proxy Statement |
• | CEO and CFO Compensation |
• | ESG Objectives for All NEOs |
Below is a summary of some of our executive compensation best practices and policies.
At Risk Pay Performance-Based Cash Incentive Awards
Robust Stock Holding Requirements Mandatory Retention of Shares Annual Peer Compensation Review | No gross-ups on excise taxes. No repricing or exchanging options without No hedging or pledging of No LTI or annual cash incentive payouts if we fail to achieve No excessive perquisites to our executive officers. No executive pension or insurance plans exclusively for No change-in-control agreements, and no automatic acceleration of equity awards upon a change in control. PSUs and RSUs do not accrue or pay dividends or dividend equivalents or have voting rights prior to vesting. We do not dilute our |
This proxy statement includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical or current facts made in this document are forward-looking. We use words such as anticipates, believes, expects, future, intends, and similar expressions to identify forward-looking statements. Forward-looking statements reflect management’s current expectations and are inherently uncertain, and actual results or outcomes could differ materially for a variety of reasons. Risks and uncertainties that could cause our actual results to differ significantly from management’s expectations are described in our 20212022 Annual Report on Form 10-K.
Forward-looking and other statements in this proxy statement regarding our environmental, social, governance (“(ESG”) and other sustainability plans and goals are not an indication that these statements are necessarily material to investors or required to be disclosed in our filings with the Securities and Exchange Commission (“(SEC”). In addition, historical, current, and forward-looking ESG and sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future.
9 |
All of our directors are elected annually at our annual general meeting of stockholders.shareholders. We recommend that you vote “FOR” each of the 11 director nominees, to be elected to serve until our 20232024 AGM (or until their death, resignation or removal). Each of the nominees is currently a director.
Henri Seydoux will not stand for re-electiondirector and was previously elected by our shareholders at our annual general meeting of stockholders. Our Board extends gratitude to Mr. Seydoux for his 13 years of service as a member of the Board.2022 AGM.
If any nominee is unable or unwilling to serve, the Board may decrease the size of the Board or designate a substitute nominee. If the Board designates a substitute nominee, proxies may be voted for that substitute nominee. The Board knows of no reason why any nominee would be unable or unwilling to serve if elected.
At the 20222023 AGM, votes may not be cast for a greater number of persons than the number of director nominees named in this proxy statement. Shares represented by properly executed proxies and not revoked will be voted if authority to do so isin accordance with the instructions indicated on those proxy cards. If you have properly executed your proxy card and you have not withheld, for the election of each of the 11 nominees named under “—Our Director Nominees” below.given specific voting instructions, your shares will be voted in accordance with our Board’s recommendations.
The Board of Directors | each director nominee. |
The Nominating and Governance Committee believes that SLB director nominees should have the following characteristics:
• be persons of integrity and honesty,
• | be persons of integrity and honesty, | |
• | be able to exercise sound, mature and independent business judgment in the best interests of our shareholders as a whole, | |
• | be recognized leaders in business or professional activity, | |
• | have background and experience that will complement those of other Board members, | |
• | be willing and able to actively participate in Board and committee meetings and related activities, | |
• | be able to work professionally and effectively with other Board members and SLB management, | |
• | be available to remain on the Board long enough to make an effective contribution, and | |
• | have no material relationship with competitors, customers or other third parties that could present realistic possibilities of conflicts of interest or legal issues. |
• be able to exercise sound, mature and independent business judgment in the best interests of our stockholders as a whole,
• be recognized leaders in business or professional activity,
• have background and experience that will complement those of other Board members,
• be willing and able to actively participate in Board and committee meetings and related activities,
• be able to work professionally and effectively with other Board members and Schlumberger management,
• be available to remain on the Board long enough to make an effective contribution, and
• have no material relationship with competitors, customers or other third parties that could present realistic possibilities of conflicts of interest or legal issues.
In the judgment of the Board, all director nominees are able to execute their duties as members of the Board and to devote the necessary time and attention to the Company,SLB, as required by our Corporate Governance Guidelines. In addition, there are no family relationships among any SLB executive officers and directors of the Company.directors.
The Nominating and Governance Committee also supports the Company’sSLB’s diversity ambitions that its Board should reflect the gender, racial and ethnic, cultural and geographical diversity of our global operations. The Board seeks out women and nationally, racially and ethnically diverse candidates to include in the pool of qualified candidates from which potential director nominees are chosen. As reflected in the summary chart on page 13,11, our 11 director nominees represent ten nationalities across five continents, and three directors are women.
Race and Ethnicity
Given our multinational footprint and culture, we endeavor to have a global perspective on diversity, including racial and ethnic diversity. This perspective includes respecting local legal requirements regarding the tracking and use of personal data pertaining to under-represented populations. Certain countries have data privacy laws prohibiting the collection or disclosure of race and ethnicity classification data, reflecting historical concerns that such data could be used to foster, rather than eliminate, discrimination. In addition, local definitions of race and ethnicity and related classifications, as well as the definition of under-represented groups, vary from country to country.
As a result, U.S.-centric racial and ethnic classifications as used for EEO-1 data collection purposes are applicable only to our three directors who are U.S. citizens. For our U.S. directors, we provide in the summary chart on page 1311 race and ethnicity disclosures based on classifications commonly used in the United States. For all other directors, we asked if they wished to voluntarily disclose their ethnic or racial background and, if so, how they self-identify based on the classifications most relevant to their home countries. We provide self-identifications for non-U.S. directors in the summary chart on page 13.11. In keeping with international data privacy laws, we have not included racial or ethnic information for director nominees who did not authorize disclosure.
2023 Proxy Statement |
Retirement Age
Under our Corporate Governance Guidelines, non-employee directors are eligible to be nominated or renominated to the Board up to their 70th birthday, and executive directors are eligible to be nominated or renominated up to their 65th birthday, after which directors may no longer be nominated or renominated to the Board. Our Board may waive this policy on a case-by-case basis on the recommendation of the Nominating and Governance Committee if it deems a waiver to be in the best interests of the Company.
Under the leadership of Mr. Papa, the Board’s independent Chairman, the Board has undergone significant refreshment and transition over the past several years. As discussed above under “Proxy Executive Summary—Board Refreshment,” five new directors joined the Board in 2020 and 2021, expanding our Board’s overall expertise in the areas of sustainability, new energy, and digital technologies and transformation. In addition, the average tenure of our director nominees is approximately two years. In light of these circumstances, and in order to allow for effective onboarding of the Board’s newest members, the Board waived the retirement age policy for Mr. Papa upon the recommendation of the Nominating and Governance Committee, because the Board believes that having Mr. Papa continue to serve as independent Chairman is in the best interests of our Company and our stockholders.
We believe our director nominees provide a well-rounded set of expertise to assist in effective oversight of SLB management.
The chart on the following pagechart summarizes the qualifications of our director nominees, including knowledge, skills, experiences and other attributes that the Board believes are relevant to their Board and committee service. Each director nominee possesses numerous other skills and experience not identified in the following chart, as further detailed in their biographies beginning on page 1412 of this proxy statement. We believe our director nominees provide a well-rounded set of expertise to assist in effective oversight of Schlumberger management.
Substantial Knowledge, Skills and Experience | ||||||||||||
Current or former chief executive officer | ||||||||||||
Energy industry and operations | ||||||||||||
Finance and accounting | ||||||||||||
Science, technology and engineering | ||||||||||||
Energy transition and sustainability | ||||||||||||
Digital innovation | ||||||||||||
Digital transformation | ||||||||||||
Information security | ||||||||||||
Strategy development & implementation | ||||||||||||
International business | ||||||||||||
Risk management | ||||||||||||
Economic modeling | ||||||||||||
Health, safety and environmental | ||||||||||||
Mergers and acquisitions | ||||||||||||
Academic relations | ||||||||||||
Government, regulatory & public policy | ||||||||||||
Demographics | ||||||||||||
Nationality | ||||||||||||
Argentina | ||||||||||||
Australia | ||||||||||||
France | ||||||||||||
Germany | ||||||||||||
Israel | ||||||||||||
Norway | ||||||||||||
Russia | ||||||||||||
Switzerland | ||||||||||||
United Kingdom | ||||||||||||
United States | ||||||||||||
Racial and Ethnicity Characteristics for U.S. Directors | ||||||||||||
Asian or Indian | ||||||||||||
White or Caucasian | ||||||||||||
Non-U.S. Directors Electing to Self-Identify Racial or Ethnicity Characteristics | ||||||||||||
Two or More Ethnicities | ||||||||||||
White or Caucasian | ||||||||||||
Gender | M | M | M | M | M | F | F | F | M | M | M | |
Other Attributes | ||||||||||||
Independence | ||||||||||||
Tenure | 2 | 4 | 6 | 4 | 2 | 5 | 3 | 2 | 5 | 4 | 2 |
11 |
Summary of Director Nominee Skills and Characteristics
Substantial Knowledge, Skills and Experience | ||||||||||||
Current or former chief executive officer | ||||||||||||
Energy industry and operations | ||||||||||||
Finance and accounting | ||||||||||||
Science, technology and engineering | ||||||||||||
Energy transition and sustainability | ||||||||||||
Digital innovation | ||||||||||||
Digital transformation | ||||||||||||
Information security | ||||||||||||
Strategy development & implementation | ||||||||||||
International business | ||||||||||||
Risk management | ||||||||||||
Economic modeling | ||||||||||||
Health, safety and environmental | ||||||||||||
Mergers and acquisitions | ||||||||||||
Academic relations | ||||||||||||
Government, regulatory & public policy | ||||||||||||
Demographics | ||||||||||||
Nationality | ||||||||||||
Argentina | ||||||||||||
Australia | ||||||||||||
France | ||||||||||||
Germany | ||||||||||||
Israel | ||||||||||||
Norway | ||||||||||||
Russia | ||||||||||||
Switzerland | ||||||||||||
United Kingdom | ||||||||||||
United States | ||||||||||||
Racial and Ethnicity Characteristics for U.S. Directors | ||||||||||||
Asian or Indian | ||||||||||||
Black or African American | ||||||||||||
Hispanic or Latino | ||||||||||||
Native American | ||||||||||||
White or Caucasian | ||||||||||||
Non-U.S. Directors Electing to Self-Identify Racial or Ethnicity Characteristics | ||||||||||||
White or Caucasian | ||||||||||||
Two or More Races or Ethnicities | ||||||||||||
Gender | M | M | M | M | M | F | F | F | M | M | M | |
Other Attributes | ||||||||||||
Independence | ||||||||||||
Tenure (in ~ years as of 2022 AGM) | <1 | 2 | 5 | 2 | 1 | 3 | 1 | <1 | 3 | 2 | <1 |
The nominees for election to the Board, together with information regarding each nominee’s qualifications, are set forth below.
Peter Coleman,
Independent Director
Former CEO and Managing Director,
Director since 2021 Age:
Other Current Public Boards •
Former Public Directorships • Woodside Petroleum Ltd. | Nationality Australia
SLB Board Committees • Nominating and Governance • Finance
Other Experience and Education • MBA, Deakin University •Bachelor of Engineering, Monash University • Chair of the Australia-Korea Foundation |
PETER COLEMAN is the former Chief Executive Officer, Executive Director and Managing Director of Woodside Petroleum Ltd., Australia’s largest independent gas producer, having served in that role from 2011 until his retirement in June 2021. Prior to joining Woodside, Mr. Coleman spent 27 years with the ExxonMobil group in a variety of roles, including Vice President Asia Pacific from 2010 to 2011 and Vice President Americas from 2008 to 2010. Since 2012, he has been an adjunct professor of corporate strategy at the University of Western Australia Business School. Since November 2022, he has served as chair of Allkem Limited, a global lithium chemicals company, having served as a director since October 2022. He has also served as chairman of the board of Infinite Blue Energy, an Australian green hydrogen renewable energy company, since August 2021.2021, as chair of H2EX, an Australian hydrogen exploration start-up, since April 2022, and as chair of DIRECT Infrastructure, an Australian-based offshore wind developer, since June 2022.
Relevant Skills and Expertise
Mr. Coleman brings to the Board decades of experience in the oil and gas industry, including as the former CEO and Chairman of Australia’s largest independent gas producer. The Board benefits from his expertise in strategic planning, as well as his extensive business experience in Australia and Asia, regions that are strategically important to the Company’sSLB’s operations.
12 | 2023 Proxy Statement |
Patrick de La Chevardière,
Independent Director
Former Chief Financial Officer,
Director since 2019 Age:
Other Current Public Boards •Michelin (Compagnie Générale des
Former Public Directorships • None | Nationality France
SLB Board Committees • Audit, Chair • Finance
Other Experience and Education •Experienced director of several French-based public companies •Diplôme d’Ingénieur, an engineering degree, École Centrale de Paris |
PATRICK DE LA CHEVARDIÈRE is the former Chief Financial Officer of Total S.A., a French multinational integrated oil and gas company. He served as Total’s CFO and as a member of its executive committee from 2008 until his retirement in August 2019. Prior to that, he served in a variety of finance and operational roles with Total over his 37-year career, including as Deputy Chief Financial Officer from 2003 to 2008, Vice President, Asia for Refining & Marketing from 2000 to 2003, and Vice President, Operations and Subsidiaries from 1995 to 2000. Since June 2020, Mr. de La Chevardière has also served as a member and chairman of the audit committee of the supervisory board of Michelin, a French multinational tire manufacturer. He also previously served on the boards of directors of two other French-based public companies, Sanofi-Aventis and Compagnie Générale de Géophysique.
Relevant Skills and Expertise
Mr. de La Chevardière brings to the Board financial and industry experience as a former CFO of a large multinational oil and gas company. The Board benefits from his customer-focused perspective on the oilfield services industry, and from his experience across the entire oil and gas value chain, from exploration, operations, production, trading and marketing to refining and new energies.
Miguel Galuccio,
Non-Executive Director
Chairman and Chief Executive Officer,
Director since 2017 Age:
Other Current Public Boards • Vista
Former Public Directorships • None | Nationality Argentina and United Kingdom
SLB Board Committees • Finance, Chair
Other Experience and Education •Bachelor of Science in Petroleum Engineering, Instituto Tecnológico de Buenos Aires • • Latin America energy policy expertise |
MIGUEL GALUCCIO founded and is the Chairman and Chief Executive Officer of Vista, Oil & Gas, an oilthe first listed independent energy company to operate and gas company incorporatedproduce in Mexico, and hasthe Vaca Muerta formation in Argentina, having held that position since July 2017. FromIn 2016, he co-founded GRIDX, a science-based company builder that creates and invests in biotech startups in Latin America, where he currently acts as chairman. Prior to that, from 2012 to 2016, he was theserved as Chairman and Chief Executive Officer of YPF, Argentina’s national oillargest energy company. From 1999 to 2012, he was an employee of SchlumbergerSLB and held a number ofseveral international positions, his last being President, SchlumbergerSLB Production Management. Prior to his employment at Schlumberger,SLB, he served in various executive positions at YPF and its subsidiaries from 1994 to 1999, including YPF International.
Relevant Skills and Expertise
Mr. Galuccio brings to the Board leadership and operational expertise from his experience as former chairman and chief executive officer of Argentina’s national oillargest energy company, which under his leadership became the world’s largest producer of shale oil outside of North America. He has valuable insight into the domestic and international energy policies of Argentina, Mexico, Venezuela and Ecuador, as well as extensive experience negotiating with SchlumbergerSLB customers in Latin America, Russia and China. He also remains active in the oil and gas exploration and production industry as a chief executive officer of an oil and gas company.
2023 Proxy Statement | 13 |
Olivier Le Peuch,Schlumberger
SLB Chief Executive Officer
Chief Executive Officer,
Director since 2019 Age:
Other Current Public Boards • None
Former Public Directorships • None | Nationality France
SLB Board Committees • None
Other Experience and Education •Master’s Degree in Microelectronics, Bordeaux University of Science • |
OLIVIER LE PEUCH has been theSLB’s Chief Executive Officer and a directormember of Schlumbergerthe Board since August 2019. He was the Company’sSLB’s Chief Operating Officer from February 2019 to July 2019. Prior to that, he served in a variety of global management positions, including Executive Vice President, Reservoir and Infrastructure from May 2018 to February 2019, President of the Cameron Group from February 2017 to May 2018, President of SchlumbergerSLB Completions from 2014 to January 2017, and Vice President of Engineering, Manufacturing and Sustaining from 2010 to 2014. Earlier in his career, Mr. Le Peuch was GeoMarket Manager for the North Sea and President of Software Integrated Solutions. He has been with the CompanySLB since 1987 and began his career as an electrical engineer.
Relevant Skills and Expertise
Mr. Le Peuch brings to the Board a unique operational perspective and thorough knowledge of the Company’sSLB’s operational activities worldwide as a result of his service in various global leadership positions in the Company.at SLB. The Board believes that Mr. Le Peuch’s service as the Company’s Chief Executive Officerour CEO is an important link between management and the Board, enabling the Board to perform its oversight function with the benefit of his perspectives on the Company’sSLB’s business and operations.
Samuel Leupold,
Independent Director
Former Chief Executive Officer,
Director since 2021 Age:
Other Current Public Boards • Enel SpA
Former Public Directorships • None | Nationality Switzerland
SLB Board Committees • Audit •Finance • New Energy and Innovation
Other Experience and Education • Master’s Degree in Mechanical Engineering, Swiss Federal Institute of Technology (Zurich) • MBA, INSEAD (Fontainebleau) •Energy transition and sustainability expertise |
SAMUEL LEUPOLD is the former chief executive officer of Ørsted Wind Power A/S, the principal subsidiary of Ørsted AS, a Danish renewable energy company, where he led Ørsted Wind Power to become the world’s leading developer, operator and owner of offshore wind assets during his tenure from 2013 to March 2018. Since May 2019, Mr. Leupold has served as an independent senior advisor supporting international clients in the energy and infrastructure sectors through his consultancy firm, Leupold Advisory. In addition, since May 2020, Leupold has been an independent non-executive member of the board at Enel SpA, one of Europe’s largest utilities focused on sustainability and the energy transition. He has also served as chair of Corio Generation, a specialist offshore wind business and Macquarie Green Investment Group portfolio company, since March 2022.
Relevant Skills and Expertise
Mr. Leupold brings to the Board operational experience as the former chief executive officer of a renewable energy company, as well as significant experience in energy transition and sustainability. The Board benefits from his expertise on these issues as the CompanySLB seeks to implement itsour net-zero ambition and itsour strategy to deploy sustainable technologies to provide access to energy for the benefit of all.
14 | 2023 Proxy Statement |
Tatiana Mitrova,
Independent Director
Research Fellow,
Director since 2018 Age:
Other Current Public Boards •
Former Public Directorships • | Nationality
SLB Board Committees • Audit • Finance • New Energy and Innovation
Other Experience and Education •PhD in Economics, Moscow State University • Senior Visiting Research Fellow at Oxford Institute for Energy Studies |
TATIANA MITROVA has served asbeen a research fellow at the Center on Global Energy Policy at the School of International and Public Affairs at Columbia University since May 2016. From February 2017 to December 2020, she served as Executive Director of the Energy Centre of the Moscow School of Management SKOLKOVO, a graduate business school, where she continues to serve as a professor. She has also been the Head of Research in the Oil and Gas Department in the Energy Research Institute of the Russian Academy of Sciences since 2011; a visiting professor at the Paris School of International Affairs, part of the Paris Institute of Political Studies, since 2014;2014. From 2017 to December 2020, she served as executive director of the Energy Centre of the Moscow School of Management SKOLKOVO, a graduate business school, where she also served as a professor until February 2022. She was also the head of research in the Oil and Gas Department in the Energy Research Institute of the Russian Academy of Sciences from 2011 to February 2022, and an assistant professor at the Gubkin Russian State University of Oil and Gas since 2008. Dr. Mitrova was a Visiting Researcher at the King Abdullah Petroleum Studies and Research Center from 20162008 to April 2017. Dr. Mitrova has been a member of the board of directors of PAO Novatek, a Russian independent natural gas producer, since April 2020, and is chairman of its strategy committee and a member of its audit and compensation and nomination committees.February 2022. She was previously a member of the board of directors of PAO Novatek from April 2020 to September 2022 and Unipro PJSC from 2014 to December 2017.
Relevant Skills and Expertise
Dr. Mitrova brings to the Board valuable expertise regarding energy market dynamics and the various factors affecting supply and demand for Schlumberger’sSLB’s products and services, as well as expertise relating to sustainability, decarbonization and the new energy economy. The Board values Dr. Mitrova’s knowledge of Russian and Central Asian energy markets and related risks, as well as her ties to the academic community. Her global economic perspective provides insight into emerging markets and trends, and is useful for the development of the Company’sSLB’s global business strategy.
Maria Moræus Hanssen,
Independent Director
Former Deputy Chief Executive Officer
Director since 2020 Age:
Other Current Public Boards • Alfa Laval AB • Scatec Solar ASA
Former Public Directorships • Yara International ASA | Nationality Norway
SLB Board Committees • New Energy and Innovation, Chair • Compensation • Nominating and Governance
Other Experience and Education • Former CEO of multiple E&P companies •Master’s Degrees in Petroleum Engineering, Norwegian University of Science and Technology, and Petroleum Economics and Management, IFP School • Corporate director certificate from Harvard Business School (2021) |
MARIA MORÆUS HANSSEN is the former Deputy CEO and Chief Operating Officer of Wintershall Dea GmbH, a German-based oil and gas producer, having served in that role from May 2019 to December 2019 following the merger between DEA Deutsche Erdoel AG (DEA) and Wintershall Holding GmbH. Prior to that, she served as CEO of DEA and chair of its management board from January 2018 until April 2019. Before joining DEA, she served as CEO of ENGIE E&P International SA and Head of the E&P Business Unit for the ENGIE Group in Paris from 2015 to December 2017. Ms. Moræus Hanssen served in various management and operations roles at Aker from 2008 to 2013, Statoil (now Equinor) from 2007 to 2008, and Norsk Hydro from 1992 to 2007. She has served on the boards of Scandinavian public companies Alfa Laval AB since April 2019 and Scatec Solar ASA since April 2020, and also serves in director and chair roles on various private company municipal and non-profit boards. She previously served as deputy chairman and audit committee chair of Yara International from 2015 to May 2019.
Relevant Skills and Expertise
Ms. Moræus Hanssen brings to the Board leadership and operational expertise as the former CEO of several European E&P companies. The Board values her insight into the domestic and international energy policies of Norway, Germany, France and other countries that are strategically important to Schlumberger,SLB, as well as her experience addressing risks related to the energy transition.
2023 Proxy Statement | 15 |
Vanitha Narayanan,
Independent Director
Former Chairman and Managing Director,
Director since 2021 Age:
Other Current Public Boards • ReNew Power • HCL Technologies
Former Public Directorships • None | Nationality United States of America
SLB Board Committees •Compensation • Nominating and Governance
Other Experience and Education • MBA, University of Houston •First woman chairperson of American Chamber of Commerce in India (AMCHAM India) |
VANITHA NARAYANAN is the former Chairman and Managing Director of IBM India, a subsidiary of IBM, a multinational technology corporation. Over her career spanning three decades at IBM, she held senior executive positions with responsibility for digital businesses in the United States, Asia-Pacific and India regions, including as Chairman of IBM India from January 2017 to March 2018 and Managing Director from 2013 to 2016. During her tenure, IBM India was one of IBM’s fastest-growing growth markets. Most recently, Ms. Narayanan served as Managing Director for a strategic telecommunications client of IBM’s from April 2018 until her retirement in 2020, leading a strategic 5G business partnership. Since August 2020, she has served as a director of ReNew Power, one of the largest renewable power companies in India, where she serves as a member of the audit committee.and ESG committees. She has also been a director of HCL Technologies since July 2021, where she serves as a member of the nominating and remuneration committee.
Relevant Skills and Expertise
Ms. Narayanan brings to the Board a wealth of global leadership and technology experience, particularly in the Asia-Pacific and India geographies. The Board values Ms. Narayanan’s digital expertise leading global technology businesses, as the CompanySLB continues to implement its digital strategy.
Mark Papa,
Independent Chairman of the SchlumbergerSLB Board of Directors
Former Chairman and CEO,
Director since 2018 Age:
Other Current Public Boards •None
Former Public Directorships •Centennial Resource Development • Oil States International | Nationality United States of America
SLB Board Committees • Nominating and Governance, Chair
Other Experience and Education •Former chairman and CEO of two public oil and gas companies •MBA, University of Houston •Bachelor of Science in Petroleum Engineering, University of Pittsburgh •North American energy industry pioneer |
MARK PAPA is the former Chief Executive Officer and Chairman of the Board of Centennial Resource Development, Inc., an independent oil and natural gas producer, having served in that role from 2016 until his retirement in March 2020. From 2015 to December 2019, Mr. Papa served as an advisor to Riverstone Holdings, a private equity firm specializing in energy investments. Prior to that, Mr. Papa was Chairman and CEO of EOG Resources, an independent oil and gas company, from 1999 to 2013, and he served as a member of EOG’s board of directors from 1999 until 2014. He worked at EOG for 32 years in various management positions. Mr. Papa also served on the board of Oil States International, an international field services company, from 2001 to August 2018.
Relevant Skills and Expertise
Mr. Papa brings decades of experience in the oil and gas industry and a unique insight into the North American market. He is a pioneer in the U.S. shale oil industry and built EOG Resources into one of the most profitable U.S. shale companies. He provides the Board with key insights on the U.S. shale market and Schlumberger’sSLB’s customers in North America. He also brings extensive leadership experience to the Board through his experience as CEO and chairman of multiple public companies. Mr. Papa has been involved in succession planning, compensation, employee management and the evaluation of acquisition opportunities, and provides the Board with valuable insight regarding the challenges and opportunities facing SchlumbergerSLB in these areas.
16 | 2023 Proxy Statement |
Jeff Sheets,
Independent Director
Former EVP and Chief Financial Officer,
Director since 2019 Age:
Other Current Public Boards •Enerplus Corporation •Westlake
Former Public Directorships • None | Nationality United States of America
SLB Board Committees •Compensation, Chair •Audit
Other Experience and Education •MBA, University of Houston •Bachelor of Science in Chemical Engineering, Missouri University of Science and Technology |
JEFF SHEETS is the former EVP and Chief Financial Officer of ConocoPhillips Company, a public international oil and gas company, having served in that role from 2010 until his retirement in 2016. Prior to that, Mr. Sheets served at ConocoPhillips and its predecessor companies for more than 36 years in a variety of finance, engineering and strategic planning roles. Since December 2017, Mr. Sheets has served on the board of directors of Enerplus Corporation, a Canadian oil and gas company, where he chairs the audit and risk management committee and is a member of the compensation committee. He also has served since January 2018 on the board of directors of Westlake Chemical Corporation, an international manufacturer and supplier of petrochemicals and related products, where he chairs the nominating and governance committee and is a member of the audit, compensation and corporate risk committees. Mr. Sheets is a member of the Board of Trustees at the Missouri University of Science and Technology.
Relevant Skills and Expertise
Mr. Sheets brings to the Board financial and operational expertise as a former chief financial officer of a large upstream oil and gas company. The Board benefits from Mr. Sheets’ expertise in developing and implementing corporate strategy in the oil and gas industry, as well as his significant finance, capital management and allocation, and mergers and acquisitions experience.
Ulrich Spiesshofer,
Independent Director
Former President and CEO,
Director since 2021 Age:
Other Current Public Boards •Infineon Technologies
Former Public Directorships •None | Nationality
SLB Board Committees •Compensation •New Energy and Innovation
Other Experience and Education •PhD in Economics, Universität Stuttgart •Master’s Degree in Management and Engineering, Universität Stuttgart •Digital transformation, restructuring and portfolio management expertise |
ULRICH SPIESSHOFER is the former president and Chief Executive Officer of ABB Ltd., a multinational technology-focused corporation, having served in that role from 2013 to April 2019 and as an ABB executive committee member of ABB from 2005 to April 2019. Under Dr. Spiesshofer’s leadership, ABB transformed into a global leader in digital industries and a respected technology company at the nexus of industrial products and services, robotics and software. Since June 2020, he has served as a senior advisor at The Blackstone Group L.P. (Blackstone), and in this capacity he has chaired the advisory boardboards of Sabre Industries since January 2021 and Schenck Process since May 2021, and has served as a director of TDI-USA Holdings LLC since December 2021, and has been named chair of the advisory board of Sabre Industries, all Blackstone portfolio companies. He has also served as a director of Infineon Technologies since February 2020, where he chairs the strategy and technology committee.
Relevant Skills and Expertise
Dr. Spiesshofer brings to the Board more than 30 years of global leadership experience in industries ranging from oil and gas to power and electrification to automation and digitalization. The Board values his industrial sector expertise and his business transformation experience leveraging digital technologies, products and services.
17 |
We are committed to strong corporate governance, which we believe is critical to achieving our performance goals and to maintainingretaining the trust and confidence of our stakeholders. Our governance practices include:
| Independent Chairman of the Board, separate from CEO
|
No staggered board; all directors are elected annually
| |
Fully independent Audit, Compensation, and Nominating and Governance committees
| |
Regular executive sessions of non-employee directors
| |
Majority vote standard for uncontested director elections
| |
Annual performance evaluations of Board, its committees, and individual directors
| |
100% Board attendance in | |
| Comprehensive risk assessment process designed to identify and manage enterprise-wide risks |
Proactive shareholder engagement | |
Director nominees reflect the gender, racial and ethnic, cultural and geographical diversity of our global operations, as well as diverse experience, skills, and tenure
| |
Demonstrated commitment to Board refreshment,
| |
Non-employee director tenure limits of 75 years of age or 10 years of service—whichever comes first | |
No hedging or pledging of our stock by executives or directors
| |
Robust
| |
No lobbying or making financial or in-kind contributions to political parties or candidates
|
Our relationship and on-going dialogue with our stockholdersshareholders are important parts of our Board’s corporate governance commitment. Our investor relations, sustainability, legal, and human resources teams engage with stockholdersshareholders throughout the year to seek their views on key matters, and then inform our Board and management about the issues and emerging governance trends that our stockholdersshareholders tell us matter most to them. The chairs of our Compensation and Nominating and Governance committees also participate in our engagement efforts when requested. These engagements routinely cover executive compensation, corporate governance, company strategy and performance, sustainability, human rights and other current and emerging issues.
We typically reach out to For details about our largest institutional stockholders at least annually. We then report the feedback we receive to our Board and its relevant committees, allowing the Board to better understand our stockholders’ priorities and perspectives. In addition, we may engage with our large institutional stockholders at other times in the year when we believe that there are appropriate topics to discuss. For detail on our engagement with our stockholders in advance of the 2021 AGM,2022 Investors Conference, see “Compensation Discussion and Analysis—Framework for Setting 2021 Executive Compensation—Responsiveness to Stockholder Feedback” beginning“Spotlight on: 2022 Investor Day” on page 368 of this proxy statement.
|
One of the Board’s key responsibilities is to evaluate and determine an appropriate board leadership structure to provide for independent oversight of SLB management. The Board believes that there is no single, generally accepted board leadership structure that is appropriate for all companies, and that the right structure may even vary for a single company as circumstances change. As a result, our independent directors, upon the recommendation of the Nominating and Governance Committee, consider the Board’s leadership structure at least annually. The Board welcomes and takes under consideration any input received from our shareholders regarding the Board’s leadership structure, and informs shareholders of any change in the Board’s leadership structure in any amended Corporate Governance Guidelines that we publish on our website and describe in our annual proxy statements.
Since 2019, our independent directors have separated the roles of CEO and Chairman of the Board, to allow our CEO to focus on leading the Company’sSLB’s complex international business operations, while the Chairman provides the Board experienced and independent leadership. Mr. Papa currently serves as independent Chairman of the Board, and in that role, sets the agenda for and leads all Board meetings and all executive sessions of the non-employeenon-executive directors.
The Board is currently conducting a search for a director to succeed Mr. Papa as independent chair of the Board. We expect the chair search process to be concluded in 2023 and expect Mr. Papa to retire after an appropriate handover with his successor. We do not expect Mr. Papa to stand for re-election at the Company’s 2024 annual general meeting of shareholders.
In considering its leadership structure, the Board also took into account that Schlumberger’sSLB’s current governance practices provide for strong independent leadership, active participation by our independent directors and independent evaluation of, and communication with, many members of senior management. The Board believes that its risk oversight programs would be effective under a variety of board leadership frameworks and therefore do not materially affect the Board’s choice of leadership structure.
2023 Proxy Statement |
The Board and its committees are actively involved in overseeing SLB’s risk management for Schlumberger.management. The full Board routinely assesses the Company’sSLB’s major risks and options for mitigation measures, in order to promote our stockholders’shareholders’ and other stakeholders’ interests in Schlumberger’sSLB’s business continuity, long-term health,resilience, financial strength, and overall success. We believe that our Board composition provides the CompanySLB with robust and well-rounded experience to assist in effective oversight of SchlumbergerSLB management, as discussedreflected on pages 12-13the chart on page 11 of this proxy statement. In addition, the Board delegates to its committees responsibility for overseeing certain types of risk, as reflected in the chart below, and the committees in turn report regularly to the Board on activities in their respective areas of oversight.
Board of Directors • The full Board oversees assessment of major risks facing • The full Board oversees risk management by the CEO and our senior management team, by reviewing major financial objectives, critical strategies, and long-term plans, including | ||||||||||||||||||
Audit • Financial reporting and internal controls • Major financial risk exposures • Cybersecurity risks • Finance-related compliance allegations • Independent audit and internal audit | Compensation • Compensation philosophy and policy, including addressing: • Pay-for-performance linkage and alignment to • Retention risk • Management succession | Nominating and • Ethics and compliance risks, including trade compliance, anti-bribery, anti-money laundering, and human rights, and related significant allegations • Related person transactions • Board refreshment and Board and CEO succession • Sustainability program, including acute and chronic climate risks • Progress toward our net-zero ambition | Finance • • Currency management, including non-U.S. currency fluctuation • Financial risks related to M&A and strategic transactions • | New Energy and • • Targeted new energy • Critical innovation initiatives | ||||||||||||||
SLB Senior Management | ||||||||||||||||||
Day-to-day responsibility for: | ||||||||||||||||||
• | • | • | ||||||||||||||||
Our senior management team has developed a comprehensive strategic planning and enterprise risk management (“ERM”) process for identifying, assessing, and managing risk. Through this process, we identify key risks through an annuala bi-annual corporate-level risk mapping exercise, which involves the CEO and other members of SLB senior management, along with a bottom-up operational (field-level) risk assessment by the Company’sSLB’s various geographies, businesses, and functions. In 2021,From time to time, the process also included aincludes third-party assessment by an internationally recognized accounting firm,assessments, external risk surveys, and facilitated workshops with SchlumbergerSLB executives. Our executive leadership team and its ERM and Disclosure Committee report directlyhas established an enterprise risk management committee to our CEOoversee this risk identification process and to monitor the implementation of mitigation processes. Our executive leadership team updates the Board andat least annually present toas risks that could impact the Board a comprehensive report on risk identification, response and mitigation strategies.implementation of the Company’s strategy are identified or evolve.
19 |
AsToday, the world faces the trilemma of providing secure and affordable energy to meet growing demand, while rapidly decarbonizing for a leadingsustainable future. With nearly a century of market and technology leadership, SLB is well positioned to be a leader in the energy services company, we are committedtransition. The evolving marketplace will require bold new technologies and ideas, digital transformation, and a deep commitment to being at the forefront of our industry’s shift toward more sustainable energy production—challenging not only ourselves, but also our customers, suppliers, and peers to partner on delivering measurable social and environmental progress. This translates into making measurable strides to accelerate innovation in energy transition and achieving these goals in a way that contributes to energy access and economic development with both a global and local lens.sustainability.
As part of this commitment, the Board and its committees oversee the performance and management of various environmental, social and other sustainability issues, including our energy transition strategy, emissions reduction targets, climate change, sustainability reporting, workforce health and safety, human rights, diversity, equity and inclusion in our workforce, and ethics and compliance. For example:
• | The Board oversees | |
• | The Board also oversees | |
• | The Nominating and Governance Committee oversees our sustainability programs, initiatives, and activities, and receives | |
• | The New Energy and Innovation | |
• | The Board’s other committees oversee sustainability-related topics within their respective areas of responsibility, such as the incorporation of sustainability and diversity metrics into our short-term incentive compensation programs (Compensation) |
Our line management is directly responsible for the management and mitigation of the environmental impact of our operations, withoperations. Our Vice President of HSE is responsible for our environmental management systems, and standards being the responsibility of our Vice President of HSE, andSustainability is responsible for our global sustainability strategy being the responsibility of our Vice President of Sustainability.and programs. For details about our environmental management standard and how we manage environmental risk, see our annual Sustainability Report, available at https://www.slb.com/sustainability/reports.html.
OurThe Board is committed to thoughtful board refreshment and ongoing board succession planning. All of our director nominees joined the Board within the last six years, bringing diverse and evolving experience and leadership skills in areas that are strategically important to SLB. The chart below reflects some of the key skills and experience of the non-employee directors who joined the Board since 2019, offering continuing expertise in our core industry and operations, while enhancing expertise in financial and capital management, sustainability, new energy, and digital technologies and transformation. For further information on each of our director nominees, see “Election of Directors” beginning on page 10 of this proxy statement.
20 | 2023 Proxy Statement |
Under our Corporate Governance Guidelines, provide that at least a majority ofnon-executive directors are eligible to serve on the Board must consist of independent directors, in accordance with the New York Stock Exchange (“NYSE”) listing standards. In addition, ouruntil age 75 or for a maximum ten-year term, whichever occurs first. Our Board has adopted director independence standards that meet or exceed the independence requirements in the NYSE listing standards, and which can be found in our Corporate Governance Guidelines.
Basedmay waive this policy on a case-by-case basis on the review and recommendation byof the Nominating and Governance Committee if a waiver is in SLB’s best interests.
Business Continuity Waiver for Mr. Papa — Under the leadership of Mr. Papa, the Board’s independent Chairman, the Board has determined that each director nominee listed above under “Election of Directors—Our Director Nominees” is “independent” under NYSE listing standardsundergone significant refreshment and our director independence standards, excepttransition in recent years. In addition, an active search process for a successor to Mr. Le Peuch, who is our CEO and therefore does not qualifyPapa as independent and Mr. Galuccio. The Board has also determined that each memberchair is ongoing. In light of the Audit Committee meets the heightened independence standards required for audit committee members under NYSE listing standardsthese circumstances, and the rules of the SEC and that each member of the Compensation Committee meets the heightened independence standards for compensation committee members under NYSE listing standards. Additionally, Mr. Seydoux, who is not standing for reelection, is independent, and former directors Lubna Olayan and Leo Rafael Reif, who served on the board until April 2021, were independent during the period they served on our Board.
Our Board’s independence determinations included a review of transactions that occurred since the beginning of 2019 with entities associated with our directors or members of their immediate family. In making its independence determinations, the Board considered that all our independent directors serve as directors, trustees, outside consultants or advisory board members at companies and universities that have had commercial business relationships with the Company. All such relationships involved ordinary course commercial transactions with the Company that were less than the greater of $1 million or 1% of the other entity’s annual revenues during 2021, 2020 and 2019; except for transactions with Enerplus, where Mr. Sheets serves as a director, which involved ordinary course commercial transactions with the Company that were less than 2% of Enerplus’ annual revenues during those three years.
The Board also considered that the Company made charitable contributions in the form of educational grants and sponsored research to certain academic and other institutions with which some of our directors are affiliated. Except for contributions to the Moscow School of Management SKOLKOVO, these charitable contributions were less than $120,000 per year. Our contributions to the Moscow School of Management SKOLKOVO, where Dr. Mitrova serves as a professor, were $500,000 annually for 2021, 2020 and 2019. No director received any personal benefit from any such charitable contributions.
Each year, the Board and its committees conduct rigorous self-evaluations in order to assess the overall functioning, performance and effectiveness offacilitate a smooth Board leadership transition process, the Board its committees, andwaived the individual non-employee directors. Theretirement age policy for Mr. Papa upon the recommendation of the Nominating and Governance Committee, oversees thisbecause the Board believes that having Mr. Papa continue to serve as independent Chairman is in the best interests of SLB and its shareholders. We expect the chair search process to be concluded in 2023, and do not expect Mr. Papa to stand for re-election at the Company’s 2024 annual evaluation process. From time to time, these evaluations may be conducted using a third-party facilitator.general meeting of shareholders.
|
|
|
|
Some examples of feedback implemented based on past Board evaluations processes include:
Our director orientation and continuing education programs are designed to support our directors in fulfilling their responsibilities as members of the Board. First, all new directors participate in Schlumberger’s director orientation program, to familiarize themselves with our business and operations, financial and performance strategies, controls and compliance systems, sustainability and HSE commitments, and industry dynamics. New directors also attend trainings with members of senior management focused on financial, industry- and committee-specific topics, as well as facility and well-site visits. For new and incumbent directors, regular continuing education programs help our Board stay current on industry, corporate governance, risk management, cybersecurity, and other developments relevant to their work as directors. These programs may include presentations from Schlumberger management or in-depth trainings developed by outside experts, as appropriate.
The Nominating and Governance Committee assists the Board in identifying qualified individuals to join as new members. The Board seeks out individuals whose background, experience and skills complement those of other Board members. As a result, in evaluating potential nominees, the Committee takes into consideration the Board’s current composition, the potential nominee’s ability to contribute to the Board’s diversity, the Company’sSLB’s existing and anticipated business needs, and the general qualifications of the potential nominees, as discussed above under “Election of Directors—Director Qualifications and Diversity.”
The Nominating and Governance Committee also recommends to the Board the number and names of persons to be proposed by the Board for election as directors at our AGM. In obtaining the names of possible director nominees, the Nominating and Governance Committee makes its own inquiries and receives suggestions from other directors and management. Consideration of new Board candidates typically involves a series of internal discussions, review of information regarding potential candidates, and interviews with selected candidates.
From time to time, the Nominating and Governance Committee retains executive search and board advisory consulting firms to assist in identifying and evaluating potential nominees. To further our diversity policy, we request that any such firms retained by us include women and nationally, racially and ethnically diverse candidates in the proposals they present to us. During 2021, the Nominating and Governance Committee, with the assistance of an executive search firm, evaluated a number of potential candidates and recommended each of Ms. Narayanan, Messrs. Coleman and Leupold, and Dr. Spiesshofer as Board members.
The Nominating and Governance Committee will also consider nominees recommended by stockholdersshareholders who meet the eligibility requirements for submitting stockholdershareholder proposals for inclusion in the next proxy statement and submit their recommendations in writing to: Chair, Nominating and Governance Committee Chair, c/o SLB Chief Legal Officer and Secretary, Schlumberger Limited, 5599 San Felipe, 17th 17th Floor, Houston, Texas 77056. Such recommendations must be submitted by the deadline for stockholdershareholder proposals referred to under “Other Information—20232024 Annual General Meeting of Stockholders”Shareholders” on page 7069 of this proxy statement. Unsolicited recommendations must contain all of the information that would be required in a proxy statement soliciting proxies for the election of the candidate as a director, a description of all direct or indirect arrangements or understandings between the recommending security holder and the candidate, all other companies to which the candidate is being recommended as a nominee for director, and a signed consent of the candidate to cooperate with reasonable background checks and personal interviews, and to serve as a member of our Board, if elected.
2023 Proxy Statement | 21 |
Each year, the Board and its committees conduct rigorous self-evaluations in order to assess the overall functioning, performance and effectiveness of the Board, its committees, and the individual non-employee directors. The Nominating and Governance Committee oversees this annual evaluation process. From time to time, these evaluations may be conducted using a third-party facilitator. The methodology for conducting Board and Committee self-evaluations is outlined in the chart below.
Initiate Evaluation Process | Collect Evaluation Data | Discuss Findings | Implement Feedback | |||
Upon the instruction of the Nominating and Governance Committee, written self-assessment questionnaires are distributed to each member of the Board. These questionnaires seek anonymous, candid feedback from our directors on a variety of topics, including board composition and culture, committee effectiveness, strategic planning, risk management, peer evaluation, and succession planning. | Directors’ responses to the questionnaires are then aggregated into summary reports for the Board, each of its committees, and the chair of the Nominating and Governance Committee. In 2022, the Nominating and Governance Committee engaged a third-party facilitator to conduct one-on-one interviews with our directors as part of this annual self-evaluation process. | Each October, findings from the evaluation process are reviewed and discussed in executive session at each committee meeting and the full Board meeting. Based on these discussions, the directors may recommend improvements to the Board’s structure, processes, policies, or composition, or other changes. In addition, the chair of the Nominating and Governance Committee may provide one-on-one feedback to individual directors as appropriate. | Finally, the Board, its committees, and (where appropriate) management work to implement the feedback from this evaluation process to improve Board performance and effectiveness. Following this process, the Nominating and Governance Committee annually reviews—and makes recommendations to the Board regarding—its process for evaluating the effectiveness of the Board, its committees and individual directors. |
Our director orientation and continuing education programs are designed to support our directors in fulfilling their responsibilities as members of the Board. First, all new directors participate in SLB’s director orientation program, to familiarize themselves with our business and operations, financial and performance strategies, controls and compliance systems, sustainability and HSE commitments, and industry dynamics. New directors also attend trainings with members of senior management focused on financial, industry- and committee-specific topics, as well as facility and well-site visits.
For new and incumbent directors, regular continuing education programs help our Board stay current on industry, corporate governance, risk management, cybersecurity, and other developments relevant to their work as directors. These programs may include presentations from SLB management or in-depth trainings developed by outside experts, as appropriate. For example, in 2022, the Audit Committee attended cybersecurity training sessions with SLB experts and external consultants.
From left to right: Vanitha Narayanan and Tatiana Mitrova, SLB independent directors, and Mark Papa, independent Chairman of the SLB Board, together with the other members of the Board, visited SLB’s OneSubsea* facility in Horsøy, Norway during 2022.
22 | 2023 Proxy Statement |
The Board has five standing committees: Audit, Compensation, Nominating and Governance, Finance, and New Energy and Innovation. Each member of the Audit, Compensation and Nominating and Governance committees meets the independence and other requirements of the New York Stock Exchange (NYSE) listing standards and SEC rules (including the heightened requirements that apply to audit or compensation committee members, as applicable). In addition, each member of the Audit Committee is financially literate, and each of Messrs.Mr. de La Chevardière and Mr. Sheets qualifies as an “audit committee financial expert” under applicable SEC rules.
The Nominating and Governance Committee nominates for Board approval directors to serve on and chair the Board’s committees. The following table reflects the membership of the Board’s standing committees as of February 1, 2022.2023.
Name of Director | Audit Committee | Compensation Committee | Nominating and Governance Committee | Finance Committee | New Energy and Innovation Committee | ||||||
Peter Coleman | ● | ● | |||||||||
Patrick de La Chevardière | Chair | ● | |||||||||
Miguel Galuccio | |||||||||||
Chair | |||||||||||
● | ● | ● | |||||||||
Tatiana Mitrova | ● | ● | ● | ||||||||
Maria Moræus Hanssen | ● | ● | Chair | ||||||||
Vanitha Narayanan | ● | ● | |||||||||
Mark Papa(1) | Chair | ||||||||||
Jeff Sheets | ● | Chair | |||||||||
Ulrich Spiesshofer | ● | ● |
Independent Chairman of the | |
Each standing committee operates under a written charter that sets forth the purposes, responsibilities and membership requirements of that committee. Each committee reviews the adequacy of its charter at least annually and recommends changes to the Board for approval. All committees also report regularly to the Board with respect to their activities. Committee charters are available on the Company’sSLB’s website at https://www.slb.com/who-we-are/corporate-governance/.
During 2021,2022, the Board held four regular meetings, each including an executive session of non-employee directors led by the Board’s independent Chairman. In addition, theChairman, as well as one special meeting. The Board’s standing committees held 2318 meetings in 2021,2022, which included five Audit Committee, four Compensation Committee, sixfour Nominating and Governance Committee, one Science and Technology Committee, one New Energy and Innovation Committee, and sixfive Finance Committee meetings. Officers regularly attend Board meetings to present information on our business and strategy, and directors have worldwide access to our employees outside of Board meetings. From time to time between meetings, Board and committee members confer with each other and with management and independent consultants regarding relevant issues, and representatives of management may meet with these consultants on behalf of the relevant committee.
In 2021,2022, our directors attended 100% of the meetings of the Board and its committees on which they served.
The Board’s policy regarding director attendance at our AGM is that directors are welcome, but not required, to attend. No director attended our 20212022 AGM.
We have adopted a Code of Conduct that applies to all SLB directors, officers, and employees. Our Code of Conduct is available on our website at https://www.slb.com/who-we-are/guiding-principles/our-code-of-conduct.
2023 Proxy Statement | 23 |
We have adopted Corporate Governance Guidelines that our Board believes are consistent with our values, and that promote the effective functioning of our Board, its committees and the Company. At least annually, our Board reviews and, if appropriate, revises our Corporate Governance Guidelines to reflect the Board’s corporate governance objectives and commitments. Our Corporate Governance Guidelines are available on our website at https://www.slb.com/who-we-are/corporate-governance/guidelines.
WeOur Corporate Governance Guidelines provide that at least a majority of the Board must consist of independent directors, in accordance with the NYSE listing standards. In addition, our Board has adopted director independence standards that meet or exceed the independence requirements in the NYSE listing standards, and which can be found in our Corporate Governance Guidelines.
Based on the review and recommendation by the Nominating and Governance Committee, the Board has determined that each director nominee listed above under “Election of Directors—Our Director Nominees” is “independent” under NYSE listing standards and our director independence standards, except for our CEO and Mr. Galuccio. The Board has also determined that each member of the Audit Committee meets the heightened independence standards required for audit committee members under NYSE listing standards and the rules of the SEC, and that each member of the Compensation Committee meets the heightened independence standards for compensation committee members under NYSE listing standards. Additionally, former director Henri Seydoux, who served on the board until April 2022, was independent during the period he served on our Board.
Our Board’s independence determinations included a review of transactions that occurred since the beginning of 2020 with entities associated with our directors or members of their immediate family. In making its independence determinations, the Board considered that our independent directors serve as directors, trustees, outside consultants, or advisory board members at companies and universities that have adopted a codehad commercial business relationships with SLB. These relationships all involved ordinary course commercial transactions with SLB, which were less than the greater of conduct entitled $1 million or 1% of the other entity’s annual revenues during 2022, 2021 and 2020.
The Blue PrintBoard also considered that SLB made charitable contributions to certain academic and The Blue Print in Action (together, our “Code of Conduct”),other institutions with which applies to allsome of our directors officersare currently affiliated, in each case involving less than $120,000 per year in 2022, 2021 and employees. Our Code of Conduct is available on our website at https://www.slb.com/who-we-are/guiding-principles/our-code-of-conduct.2020. No director received any personal benefit from any such charitable contributions.
The Board has a written policy governing the review, approval and ratification of “related person transactions.” Under SEC rules, as applied by the Board, “related persons” include any director, executive officer, director nominee, or greater than 5% stockholdershareholder of the CompanySLB since the beginning of the previous fiscal year, and their immediate family members. The policy applies to any transaction in which:
which SLB is a participant and any related person has a direct or indirect material interest, where the amount involved exceeds $120,000, unless excluded under Item 404(a) of SEC Regulation S-K.
The Nominating and Governance Committee is responsible for reviewing and, where appropriate, approving or ratifying any related person transaction involving SchlumbergerSLB and any related persons. The Nominating and Governance Committee approves only those related person transactions that are in, or are not inconsistent with, the best interests of the CompanySLB and its stockholders.shareholders.
SchlumbergerSLB has an ongoing commercial relationship with Vista Oil and GasEnergy (Vista), where Mr. Galuccio serves as chairman of the board and chief executive officer. In 2021, Schlumberger2022, SLB contracted with Vista to deliver ordinary course oilfield services and products, and Vista paid Schlumberger $133SLB approximately $156 million.
The Board recommends that stockholdersshareholders and other interested parties initiate communications with the Board, the Chairman or any Board committee by writing to our Chief Legal Officer and Secretary. This process assists the Board in reviewing and responding to communications by stockholdersshareholders and other interested parties. The Board has instructed our Chief Legal Officer and Secretary to review correspondence directed to the Board (including to the Chairman and any Board committee) and, at the Secretary’s discretion, to forward those items that she deems appropriate for the Board’s consideration. Communications can be sent to the following address: Schlumberger Limited, Attention:SLB Board of Directors c/o SLB Chief Legal Officer and Secretary, 5599 San Felipe, 17thFloor, Houston, Texas 77056.
2023 Proxy Statement |
Our director compensation philosophy is to appropriately compensate our non-employee directors for the time, expertise and effort required to serve as a director of a large and complex global company, and to align the interests of our directors with those of our long-term stockholders.shareholders. Directors who are SLB employees of Schlumberger do not receive compensation for serving on the Board.
Non-employee directors receive the following cash compensation:
• | an annual cash retainer of $115,000; | |
• | an annual fee of $10,000 for each committee membership; | |
• | if the director is the chair of a committee, an annual fee of $20,000 in lieu of the fee for committee membership; and | |
• | if the director is the independent Board Chairman, an additional $100,000 annual cash fee. |
SchlumbergerSLB annually grants shares of our common stock valued at approximately $190,000 for each non-employee director, or $290,000 for the independent Board Chairman. The shares are valued based on our closing stock price on the last business day of April of the grant year.
For 2021,2022, our non-employee directors received the following grants of our common stock effective May 3, 2021:2, 2022:
• | ||
• |
The following table provides information on the compensation paid to our non-employee directors in 2021.2022.
Name | Fees Earned or Paid in Cash ($) | (1) | Stock Awards ($) | (2) | Total ($) | |
Peter Coleman(3) | 87,842 | 153,756 | 241,598 | |||
Patrick de La Chevardière | 142,500 | 198,217 | 340,717 | |||
Miguel Galuccio | 137,500 | 198,217 | 335,717 | |||
Samuel Leupold(4) | 119,949 | 204,960 | 324,909 | |||
Tatiana Mitrova | 140,000 | 198,217 | 338,217 | |||
Maria Moræus Hanssen(5) | 150,000 | 347,802 | 497,802 | |||
Vanitha Narayanan(6) | 48,914 | 105,197 | 154,111 | |||
Lubna Olayan(7) | 14,973 | — | 14,973 | |||
Mark Papa | 237,500 | 302,547 | 540,047 | |||
Leo Rafael Reif(7) | 16,005 | — | 16,005 | |||
Henri Seydoux | 142,500 | 198,217 | 340,717 | |||
Jeff Sheets | 145,000 | 198,217 | 343,217 | |||
Ulrich Spiesshofer(6) | 48,914 | 105,197 | 154,111 |
Name | Fees Earned or Paid in Cash ($) | (1) | Stock Awards ($) | (2) | Total ($) | |||
Peter Coleman | 135,000 | 190,505 | 325,505 | |||||
Patrick de La Chevardière | 145,000 | 190,505 | 335,505 | |||||
Miguel Galuccio | 135,000 | 190,505 | 325,505 | |||||
Samuel Leupold | 145,000 | 190,505 | 335,505 | |||||
Tatiana Mitrova | 145,000 | 190,505 | 335,505 | |||||
Maria Moræus Hanssen | 155,000 | 190,505 | 345,505 | |||||
Vanitha Narayanan | 135,000 | 190,505 | 325,505 | |||||
Mark Papa | 235,000 | 290,744 | 525,744 | |||||
Henri Seydoux(3) | 14,579 | — | 14,579 | |||||
Jeff Sheets | 145,000 | 190,505 | 335,505 | |||||
Ulrich Spiesshofer | 135,000 | 190,505 | 325,505 |
(1) | The amounts reported reflect cash fees actually paid in |
(2) | The amounts reported reflect the aggregate grant date fair value of the stock awards computed in accordance with applicable accounting standards, based on the closing stock price on the applicable grant date. Amounts rounded to nearest dollar. A non-employee director may elect to defer the receipt of all or part of a stock award under the SLB 2004 Stock and Deferral Plan for Non-Employee Directors. In 2022, Ms. Narayanan deferred receipt of 100% of her annual stock award until the date she ceases to be an SLB director. |
(3) | |
Did not stand for re-election at our |
Non-employee directors who begin their Board, Board Chair, committee or committee chair service after the AGM receive a prorated amount of annual compensation. SchlumbergerSLB also reimburses non-employee directors for travel and other business expenses incurred in the performance of their services for Schlumberger.us.
2023 Proxy Statement | 25 |
Our Compensation Committee annually reviews our non-employee director compensation, and periodically recommends that the Board approve updates to director pay. In 2021,2022, the Committee’s director pay review took into account multiple factors including our director compensation philosophy, changes in market practices, the continued expansion of director and committee chair responsibilities, consultations with the Committee’s independent compensation consultant, Pay Governance, and feedback received during our shareholder engagements. Based on that review, the Committee determined that no changes in non-employee director compensation were necessary for 2021.2022. The Committee has not increased the directors’ annual cash retainer, committee chair or membership fees, or annual stock grant value since 2017 (except in connection with separating the Chairman and CEO roles in 2019).
While the Committee is aware that other jurisdictions may have differing director compensation practices, the Committee believes it is in the best interests of the CompanySLB and our stockholdersshareholders as a whole to align to market practice among NYSE-listed companies and companies with a large U.S. shareholder base. The Committee also believes that the interests of our non-employee directors are most aligned with the interests of our stockholdersshareholders when a significant portion of director compensation is paid through stock grants.
The Board believes that ownership of SchlumbergerSLB stock by our directors aligns their interests with the interests of our stockholders, and as a result,shareholders. Accordingly, the Board has maintained stock ownership guidelines for its directors. In 2021, upon recommendation of the Nominating and Governance Committee and the Compensation Committee, our Board revised our director stock ownership guidelines to requireestablished a guideline that each non-employee director to holdmust, within five years of joining the Board, own a minimum dollar value of shares of SchlumbergerSLB common stock equal to five times (5x) that director’s annual cash retainer. The director has five years from appointment to meet this holding requirement. As of January 31, 2022,2023, each of our non-employee directors who has been a Board member for at least five years was in compliance with these stock ownership guidelines.
Non-employee directors may elect to defer all or a portion of their annual stock or cash awards through the SchlumbergerSLB 2004 Stock and Deferral Plan for Non-Employee Directors (the “Directors Stock Plan”). When directors elect to defer their stock award, their deferred compensation account is credited with a number of “stock units.” Each stock unit is equal in value to a share of our common stock, but because it is not an actual share of our common stock it does not have any voting rights. When directors elect to defer their cash award, they may choose to invest such deferred cash compensation into either (i) SchlumbergerSLB common stock, (ii) money market equivalents, or (iii) an S&P 500 equivalent. Deferrals into a stock account are credited with dividend equivalents in the form of cash to be paid at the time of vesting and deferrals into the cash account are credited with gains or losses based on the monthly performance of the various investment options described above. Following retirement from our Board and depending on the director’s election, a non-employee director may receive the deferred compensation on the date of the director’s retirement or a date that is one year following the date of the director’s retirement.
2023 Proxy Statement |
The following table sets forth information known to us with respect to beneficial ownership of our common stock as of January 31, 20222023 by (i) each director and director nominee, (ii) each of the named executive officersofficer, and (iii) all executive officers (as defined in Rule 3b-7 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), and directors as a group (the “D&O Group”).
The number of shares beneficially owned as of January 31, 20222023 includes shares of SLB common stock that the individual has the right to acquire within 60 days of January 31, 2022,2023, including exercisable options to purchase our common stock, as well as RSUs and PSUs that will vest within 60 days. The table below does not include (i) shares of SLB common stock deferred under the Directors Stock Plan, or (ii) the number of shares earned but not yet issued under our 20192020 ROCE PSUs, because the CompanySLB will finally determine the number of shares earned after the applicable comparator companies disclose their full-year audited 20212022 results, as described under “Compensation Discussion and Analysis—Elements of 20212022 Total Direct Compensation—Long-Term Equity Incentive Awards—Payouts Under Prior LTI Awards—PSUs Vesting in 2022”2023” beginning on page 4743 of this proxy statement. These same policies apply to the aggregate calculation for the D&O Group.
Beneficial Ownership of SLB Common Stock | ||||||||
Name | Number of Shares | (1) | Percentage of Class | |||||
Khaled Al Mogharbel (NEO) | 645,725 | <1% | ||||||
Ashok Belani (NEO) | 707,357 | (3) | <1% | |||||
(4) | <1% | |||||||
Peter Coleman | 10,606 | <1% | ||||||
Patrick de La Chevardière | 25,460 | <1% | ||||||
Miguel Galuccio | 34,660 | <1% | ||||||
Olivier Le Peuch (NEO) | <1% | |||||||
Samuel Leupold | 12,143 | <1% | ||||||
Abdellah Merad (NEO) | 268,357 | (6) | <1% | |||||
Tatiana Mitrova | 29,144 | <1% | ||||||
Maria Moræus Hanssen | 13,152 | <1% | ||||||
Vanitha Narayanan | 3,695 | <1% | ||||||
Mark Papa | 68,286 | <1% | ||||||
86,948 | <1% | |||||||
Jeff Sheets | 25,460 | <1% | ||||||
Ulrich Spiesshofer | 8,566 | <1% | ||||||
All directors and executive officers as a group | <1% |
(1) | Beneficial ownership is determined under the rules of the SEC and generally includes voting or investment power with respect to securities. Except as indicated in the below footnotes and subject to applicable community property laws, to our knowledge the persons named in this table have sole voting and investment power with respect to the securities listed. None of the shares are subject to any pledge. |
(2) | |
(3) | Includes options to purchase |
(4) | Includes options to purchase |
(5) | Includes options to purchase 129,000 SLB shares. |
(6) | Includes options to purchase |
(7) | Includes options to purchase |
27 |
The following table sets forth information as of December 31, 20212022 (except as otherwise noted) with respect to persons known by us to be the beneficial owners of more than 5% of our common stock, based solely on the information reported by such persons in their Schedule 13D and 13G filings with the SEC.
For each entity included in the table below, percentage ownership is calculated by dividing the number of shares reported as beneficially owned by such entity by the 1,413,019,3161,428,189,537 shares of our common stock outstanding on January 31, 2022.2023.
Beneficial Ownership of Common Stock | ||||||||
Name and Address | Number of Shares | Percentage of Class | ||||||
The Vanguard Group(1) | 119,850,812 | 8.5 | % | |||||
100 Vanguard Blvd. | ||||||||
Malvern, PA 19355 | ||||||||
BlackRock, Inc.(2) | 111,487,119 | 7.9 | % | |||||
55 East 52nd Street | ||||||||
New York, NY 10055 | ||||||||
State Street Corporation(3) | 92,164,506 | 6.5 | % | |||||
State Street Financial Center | ||||||||
One Lincoln Street | ||||||||
Boston, MA 02111 |
Beneficial Ownership of SLB Common Stock | ||||
Name and Address | Number of Shares | Percentage of Class | ||
The Vanguard Group(1) 100 Vanguard Blvd. Malvern, PA 19355 | 125,139,611 | 8.8% | ||
BlackRock, Inc.(2) 55 East 52nd Street New York, NY 10055 | 107,803,887 | 7.5% | ||
State Street Corporation(3) State Street Financial Center One Lincoln Street Boston, MA 02111 | 86,680,330 | 6.1% |
(1) | Based solely on a Statement on Schedule 13G/A filed on February |
(2) | Based solely on a Statement on Schedule 13G/A filed on |
(3) | Based solely on a Statement on Schedule 13G/A filed on February |
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires our executive officers and directors, among others, to file an initial report of ownership of Schlumberger common stock on Form 3 and reports of changes in ownership on Form 4 or Form 5. Persons subject to Section 16 are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms that they file. The Company believes, based solely on a review of the copies of such forms in its possession and on written representations from reporting persons, that two transactions required to be reported under Section 16(a) were not timely reported during the fiscal year ended December 31, 2021. Two Form 4s required to be filed by Mr. Le Peuch in 2021 relating to shares acquired pursuant to a brokerage dividend reinvestment plan were not timely filed, but were filed on January 21, 2022.
2023 Proxy Statement |
Our Board is asking you to vote, on an advisory basis, on whether future advisory votes on executive compensation (as reflected in Item 3 below) should occur every year, every two years or every three years. This item, which is provided pursuant to Section 14A of the Exchange Act, is commonly referred to as a “say-on-frequency” resolution.
After careful consideration, our Board recommends that future advisory votes on executive compensation occur every year. We believe that an annual advisory vote on executive compensation will allow our shareholders to provide frequent, direct input on our compensation policies and practices and the resulting compensation for our named executive officers. Shareholders will have the opportunity to consider our most recent compensation decisions and focus on increasing long-term shareholder value, and to provide feedback to us in a timely way.
In making this recommendation, the Board considered that a majority of the votes cast at our 2017 AGM voted in favor of holding annual advisory votes on executive compensation. In addition, we are aware of the significant interest in executive compensation matters by investors and the general public, and value and encourage constructive dialogue with our shareholders on these matters.
This advisory resolution is non-binding on the Board. Although we currently believe that holding an advisory vote on executive compensation every year will reflect the right balance of considerations in the normal course, we will continue to periodically reassess that view and may provide for an advisory vote on executive compensation on a less frequent basis if long-term stability in our compensation program or other circumstances suggest that such a vote frequency would be more appropriate.
The Board of Directors recommends a vote to conduct future advisory votes on executive compensation every ONE YEAR. |
2023 Proxy Statement | 29 |
Our Board is asking you to approve, on an advisory basis, the compensation of our NEOs as disclosed in this proxy statement. This item, which is provided pursuant to Section 14A of the Exchange Act, is commonly referred to as a “say-on-pay” resolution.
The Compensation Committee has structured our executive compensation program to achieve the following key objectives:
• | to attract, motivate and retain talented executive |
• | to motivate the achievement of |
• | to align the interests of our executive officers with those of our |
each as described in the “Compensation Discussion and Analysis” section of this proxy statement.
Our Compensation Committee and the Board believe that the policies and procedures articulated in the “Compensation Discussion and Analysis” are effective in achieving our goals, and that the compensation of our NEOs as reported in this proxy statement has contributed to the Company’sSLB’s short-term and long-term success. Therefore, we are asking our stockholdersshareholders to approve the compensation of our NEOs by voting “FOR” the following resolution on an advisory basis:
RESOLVED, that the compensation paid to the Company’sSchlumberger Limited’s named executive officers, as disclosed in this proxy statement, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby APPROVED on an advisory basis.
Although thisThis vote is non-binding, but our Board and the Compensation Committee will review and consider the voting results when making future decisions regarding our executive compensation program.
Although annual “say-on-pay” advisory votes are not required by our bylaws, the Board currently believes that having our stockholdersshareholders provide annual feedback on our compensation practices provides forsupports effective governance. As a result, the next “say-on-pay” advisory vote will occur in 2023,2024, unless the Board modifies its policy on the frequency of holding “say-on-pay” advisory votes.
The Board of Directors | 3. |
The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with the Company’sSLB’s management. Based on that review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.
SUBMITTED BY THE COMPENSATION COMMITTEE OF THE SCHLUMBERGER BOARD OF DIRECTORS
Submitted by the Compensation Committee of the SLB Board of Directors | ||||
Jeff Sheets, Chair | Maria Moræus Hanssen | Vanitha Narayanan | Ulrich Spiesshofer |
2023 Proxy Statement |
This Compensation Discussion and Analysis (“(CD&A”) describes our compensation policies and practices as they relate to our fivesix named executive officers (“(NEOs”) listed below:identified below.
Named Executive Officers | Title |
Olivier Le Peuch | Chief Executive Officer |
Stephane Biguet | Executive Vice President and Chief Financial Officer |
Khaled Al Mogharbel | Executive Vice President, Geographies |
Executive Vice President, Core Services and Equipment | |
Dianne Ralston | Chief Legal Officer and Secretary |
Ashok Belani | Senior Strategic Advisor to the CEO; Former Executive Vice President, |
The purpose of the CD&A is to explain the elements of our NEOs’ 2021 compensation;2022 compensation, the criteria for selecting these elements;elements, the decisions our Compensation Committee made with respect to the 20212022 compensation of our NEOs;NEOs, and the reasons for those decisions.
31 |
2021We are SLB—a global technology company that drives energy innovation for a balanced planet
2022 was an exceptional yeartransformative for Schlumberger,SLB. We launched our bold new SLB brand identity—reinforcing our leadership position in whichtechnology, digital, and sustainability in the energy industry—and we demonstrated the strengthour ability to deliver superior earnings in this early phase of a structural upcycle in energy. We set new safety, operational, and agility ofperformance benchmarks for our emergent strategy—rootedcustomers and strengthened our market position both internationally and in operational execution, superior returns, and capital discipline. After two years of extraordinary industry, market, and social uncertainty, the Schlumberger team delivered a year of remarkable financial results, surpassing all of our 2021 financial targets and closing the year with excellent momentum.North America.
Highlights of our 20212022 financial performance reflecting(1) include:
Grew revenue 23% year on year | Grew GAAP EPS by 81% year on year | Expanded income before taxes margin to 15.2% | Strengthened balance sheet by reducing both gross and net debt by $1.7 billion | |||
Increased dividend 40%in April 2022 43%in January 2023 | Grew EPS, excluding charges & credits, by 70% year on year | Expanded adjusted EBITDA margin to 23.0% | Ended 2022 with 1.4x net debt to adjusted EBITDA ratio—lowest level since 2016 |
In 2022, we executed our strategy across our Three Engines of Growth—our Core, Digital, and New Energy—and successfully leveraged the successbreadth of our returns-focused strategyportfolio and execution, include:our competitive strengths to deliver peer-leading outcomes for our customers and shareholders.
In our Core Divisions, we expanded pretax segment operating margins and launched new products, services, and solutions that increase efficiency and lower operational emissions. Our fit-for-basin, technology access and Transition Technologies portfolios fueled growth and margin expansion in every Division in 2022. And we continue to strengthen our Core portfolio for growth and position for future resilience and shareholder returns through strategic initiatives such as the announced subsea joint venture with Aker Solutions and Subsea 7. | In Digital, we had strong growth in exploration data, Innovation Factori and artificial intelligence solution sales, and the adoption of our new digital technologies is accelerating. We ended the year with more than 70% growth in Delfi users, and our SaaS revenue more than doubled. We continue to build adjacent expansion opportunities for our digital business, both in the operations data space and beyond oil and gas, such as carbon management. | |||
In | ||||
geoenergy, critical minerals, and stationary energy storage. We are also accelerating our R&D efforts to develop technology solutions that address hard-to-abate industrial and power generation emissions. | ||||
On the strength of these financial results, driven by excellent operational leverage as a result of our Performance Strategy and strong working capital management, we were able to reduce our net debt to adjusted EBITDA ratio from 3.2x to 2.2x year-on-year. At the same time, we achieved double-digit pretax operating margins in North America—the highest levels since 2014—and we expanded our international pretax operating margins to the highest levels since 2018.
The success of 2021 was built upon the continued growth of our strategic business pillars—strengthening our core, digital, and new energy—to deliver high performance sustainably.
In our Core business, we fully operationalized our returns-focused strategy through our new Division and Basin organization and high-graded business portfolio, which have significantly increased our operating leverage. As a result of our differentiated capabilities, exceptional execution, and technology performance, we enhanced our market positions and won significant project awards during the year. With increased operating leverage and our outstanding customer performance, we ended the year marking six consecutive quarters of pretax segment operating margin expansion.
In DigitalSustainability, we expanded market accessreduced our Scope 1 and accelerated the adoption of our platform, which brings our customers AI capabilities and powerful digital tools to reduce cycle time, improve performance, and lower2 carbon intensity. We built partnerships to achieve comprehensive cloud access globally, collaborated with AI innovators to deploy machine-learning and AI solutions, and enabled digital operations through the automation of key workflows in well construction and production operations.
In Schlumberger New Energy, we continued to advance the development of clean energy technologies and low-carbon projects. In 2021, we invested in stationary energy storage—expanding our total addressable market—and progressed our ventures in hydrogen, lithium, geoenergy, and a suite of CCUS opportunities, including our BECCS project.
2021 also saw continued excellence in Safety and Service Quality,emissions intensity as we successfully navigated the challenges of the ongoing pandemic to ensure continued execution and performance for our customers. Our total recordable injury frequency showed a 31% improvement since 2019, and we also improved our automotive accident rate by 30% compared to 2019. Furthermore, our service quality performance was the best on record, despite increasing activity coupled with ongoing pandemic and supply chain challenges.
This was2021. We also a pivotal year for Schlumberger’s commitmentlaunched several new Transition Technologies to Sustainability. We announced our comprehensive 2050 net-zero commitment inclusive of Scope 3 emissions—a first for the energy services sector—and we launched our Transition Technology portfolio to focus onsupport the decarbonization of oil and gas, operations. In addition, Schlumberger earned an upgraded AA rating from MSCI,as well as our SLB End-to-end Emissions Solutions (SEES) methane elimination business.
We also advanced our technology leadership, safety and won an ESG Top Performer award from Hart Energy, recognizing our sustainability efforts, our enhanced disclosures,operations integrity performance, and service quality differentiation, leading to more contract awards, higher technology adoption, and increased pricing premiums.
Finally, we demonstrated our commitment to applySuperior Shareholder Returns. We increased our technologiesdividend by 40% in April 2022, followed by a further 43% increase in January 2023, and capabilities toward helpingwe resumed our share buyback program in January 2023.
Looking to 2023, we believe the world sustainably meet future energy demand.
In summary, 2021 was a definingmarket fundamentals are aligned with what we do best—innovating and transformative yearoutperforming for Schlumberger. We continued to strengthen our core portfolio, while also enhancingcustomers. With our sustainability leadership, advancing our digital journey,bold new brand and expanding our new energy portfolio.
As we enter 2022, Schlumberger is well prepared to seize the multiyear growth cycle ahead of us. We have entered this cycle in a position of strength, having reset our operating leverage, expanded peer-leading margins across multiple quarters, and aligned ouridentity founded on technology and business portfolioinnovation, our strategy with sustainability at its heart, and our strong financial and operational results leading into the new industry imperatives. We are truly excited aboutcurrent upcycle, we believe we have set a very solid foundation for strong performance and shareholder value creation in 2023 and into the outlook for Schlumberger—for continued financial outperformance, technology leadership, and growth opportunities in digital and clean energy innovation—to enable the world to unlock access to energy for the benefit of all.next decade.
(1) | |
2023 Proxy Statement |
In making decisions regarding 20212022 executive compensation, our Compensation Committee continued to focus on:
• | strengthening pay-for-performance |
• | motivating and incentivizing |
• | maintaining stability and retaining our top talent through business |
• | appropriately compensating our executives for effectively deploying capital, generating strong cash flow, and creating long-term |
In this context, and as more fully discussed elsewhere in this CD&A, below are some key actions that theour Compensation Committee took with respect to our NEOs’ 20212022 compensation.
• |
The 2021 LTI program consisted of four types of grants, equally weighted at target performance:
• | ||
• | Performance-Aligned Incentive Payouts — Our NEOs’ STI payouts were based on strong 2022 adjusted EBITDA results, partially offset by below-target 2022 free cash flow results, and their LTI payouts were based on exceptional multi-year ROCE and free cash flow conversion |
Short-Term Incentive Results |
• |
As a result of this redesign, we reduced the maximum overall payout opportunity under our 2021 LTI program from 250% to 200%, in line with market practice for a more balanced and diversified LTI grant program.
Average NEO |
• |
• Zero FCF Payout — Our 2022 free cash flow(1) of $1.418 billion was below the minimum performance target under our annual cash incentive plan. As a result, our CEO and other NEOs earned no payout under the free cash flow component of our 2022 cash incentive plan. | • Our CEO did not receive an LTI award in 2020 and therefore did not earn any 2020 PSUs. • For our other NEOs, the 2020 LTI payout was based on: (i) SLB’s average annual ROCE for the three-year performance period, which was 407 bps above the average ROCE of the comparator group, (ii) SLB’s absolute 2022 ROCE of 13%, and (iii) SLB’s cumulative FCF conversion rate of 192% from 2020 to 2021—which far exceeded the maximum performance goal for the 2020 FCF conversion PSUs. • As a result, our NEOs, other than our CEO, earned 250% of the target shares of SLB stock under the 2020 PSUs. |
• |
• | ESG Objectives for All NEOs — |
(1) |
33 |
The Board did not increase any element of the 2021 target total direct compensation of Mr. Le Peuch, our CEO, as compared to 2020. However, due to the timing of a 2019 PSU grant (in lieu of a 2020 grant) awarded to Mr. Le Peuch in connection with his CEO appointment, the Summary Compensation Table reflects an increase in his 2021 total reported compensation, as explained in the chart below.
In August 2019, in connection with Mr. Le Peuch’s promotion to CEO, he received a PSU award with a target value of $10.5 million. This award was granted in lieu of a 2020 LTI award, and, as a result, Mr. Le Peuch’s total 2019 compensation, as shown in the Summary Compensation Table, reflects his target 2020 LTI award as well, while his 2020 compensation is unusually low. This is illustrated in the chart at below left entitled “CEO Pay, Reported”.
In order to better reflect our Compensation Committee’s annual compensation mix for our CEO, the chart at below right entitled “CEO Pay, As Adjusted” reflects his three-year total direct compensation, as adjusted to show the 2019 CEO promotion LTI grant subtracted from the 2019 column and added to the 2020 column, because that award was in lieu of his 2020 LTI target award.
|
| |
Our 2022 executive compensation program consisted of three primary elements, comprising our executives’ total direct compensation: LTI equity incentive awards (PSUs and RSUs), STI (annual) cash incentive awards, and base salary. Within these elements, 75% of our executives’ 2022 target LTI equity awards and 100% of their annual cash incentive awards were performance-based. These elements have allowed us to remain competitive and attract, retain, and motivate top executive talent whose interests are aligned with those of our shareholders.
The chart below sets out the primary elements of our NEOs’ 2022 total direct compensation, certain key features of each element, and how each of these compensation elements supports our strategy.
Type | Element | Key Features | How Element Supports Our Strategy | Performance- Based? | At Risk? |
Free Cash Flow Margin PSUs (25%) | Absolute performance metric, based on our FCF margin over a three-year period | • Aligns with our publicly disclosed financial ambition of achieving double-digit FCF margin • Encourages our NEOs to generate high-quality revenue, which translates into strong free cash flow in line with our capital stewardship program | |||
Return on Capital Employed PSUs (25%) | Relative performance metric, comparing our average annual ROCE over a three-year period to that of our direct competitors | • Measures the efficiency of our capital employed relative to direct competitors, consistent with our strategic priorities • Motivates and rewards executives for relative outperformance on a key financial metric | |||
Total Shareholder Return PSUs (25%) | Relative performance metric, comparing our cumulative TSR over a three-year period to that of our direct competitors, as well as the S&P Global 1200 Energy Index | • Directly aligns executive LTI payouts with shareholder value creation • Uses a clear and objective metric to evaluate our performance against our direct competitors and against the broader energy sector | |||
Time-Based RSUs (25%) | Cliff vesting after three years, subject to continued employment | • Promotes stability and retention of our executive team through business cycles | |||
Annual Cash Incentive Award | 70% based on achieving quantitative financial objectives, evenly split between adjusted EBITDA and free cash flow targets 30% based on strategic personal objectives | • Adjusted EBITDA reflects the quality of SLB’s earnings • Free cash flow goals encourage our NEOs to continue strengthening our balance sheet, so we can sustainably return value to shareholders while making focused investments in future growth areas • Personal objectives, detailed on page 38, align to our strategic focus areas | |||
Base Salary | Only fixed compensation element | • Provides a base level of competitive cash compensation when all other pay elements are variable or contingent on performance |
34 | 2023 Proxy Statement |
In setting our executives’ compensation, our Compensation Committee believes that:
• | the pay of our NEOs and other executives should be strongly linked to performance that is evaluated against financial and strategic personal objectives, and should balance incentivizing outperformance, ensuring retention, and maximizing | |
• | our performance-based LTI and cash incentive awards should utilize clear, quantitative financial metrics that are closely aligned with our corporate strategy and stated external objectives and should be effective through all industry | |
• | LTI awards should encourage the creation of long-term | |
• | our executive compensation structure should enable us to recruit, develop, motivate, and retain top global talent, both in the | |
• | stock ownership guidelines, which require our executives to hold stock acquired through LTI awards, should further align the interests of our executives with those of our other |
Our 2021 executive compensation program consisted of three primary elements, comprising our executives’ total direct compensation:
Within these elements, 75% of our executives’ 2021 target LTI equity awards and 100% of their annual cash incentive awards were performance-based. These elements have allowed us to remain competitive and attract, retain and motivate top executive talent.
The chart below sets out the primary elements of our NEOs’ 2021 total direct compensation, certain key features of each element, and how each of these compensation elements supports our strategy.
| |||||||
| |||||||
| |||||||
|
| ||||||
Our executive compensation program is designed so that the higher an executive’s position in the Company, the greater the percentage of compensation that is “at risk”. At-risk compensation refers to an executive’s LTI awards and annual cash incentive opportunity. We believe that having a significant portion of our executives’ compensation at risk more closely aligns their interests with Company interests and with the interests of our stockholders.shareholders.
As illustrated below, approximately 90% of our CEO’s 20212022 target total direct compensation was at risk, and approximately 83%84% of our other NEOs’ 20212022 target total direct compensation was at risk.
CEO
| Other NEO
| |
(1) | Does not include pay mix for Mr. Belani, who retired from his role as EVP, New Energy effective April 1, 2022, and was appointed Senior Strategic Advisor to the CEO, a non-executive officer position. |
Our Compensation Committee seeks to achieve an appropriate balance between LTI awards, which emphasize long-term stockholder value creation through efficient conversion of revenue into cash, effective deployment of capital, and total shareholder return, and annual cash rewards, which encourage achievement of near-term financial and non-financial objectives.
Based on market data provided by Pay Governance, LLC, our Compensation Committee’s independent compensation consultant, (“Pay Governance”), the pay mix of our NEOs is well-aligned with that of the companies in our two main executive compensation peer groups.groups, as described in “Other Aspects of Our Executive Compensation Program—Our Peer Group Companies” on page 46.
In January 2021, our Compensation2022, the Committee concluded that based on the relative size of direct compensation elements of companies in our main executive compensation peer groups—as well as internal factors—the mix of base salary, target annual cash incentive, and target LTI was appropriate for each of our NEOs.NEOs, based on the relative size of direct compensation elements of companies in our main executive compensation peer groups, as well as internal factors.
Our executive compensation program design in recent years was largely developeddesigned and implemented in response to, and as a product of, past discussions with our stockholders.shareholders. For example, in recent years:2021, based on shareholder feedback, we introduced our three-year relative TSR PSUs to more directly align LTI payouts with shareholder value creation, and we set the target performance goal above median at the 60th percentile. In 2022, our Compensation Committee adjusted the comparator group for our TSR PSUs to include the S&P Global 1200 Energy Index, based on feedback that our shareholders also evaluate our TSR performance against the broader energy sector.
Following these program enhancements and our proactive engagement with stockholders,In 2022, our executive compensation program received the support of more than 95% of the votes cast at our 2021 AGM.
Our Boardannual meeting. As a result, and based on past shareholder feedback, our Compensation Committee recognize that continued, regular engagement with our stockholders is critical to maintaining the substantial support of our executive compensation program demonstrated by our stockholders at our 2021 AGM. In advance of that meeting, we reached out to stockholders representing more than 50% of our outstanding common stock, to seek their views on our executive compensation program, as well as other corporate governance and sustainability topics. Stockholders representing approximately 11% of our outstanding common stock requested meetings to discuss our executive compensation, and our management team then reported on these discussions to our Compensation Committee. The feedback from these efforts indicatedbelieves that our overall compensation program design is supportedwell-supported by our stockholders.shareholders.
35 |
Our Compensation Committee used data from several distinct peer groups in evaluating and setting 2021 executive compensation, as summarized in the table below, and as further discussed throughout this CD&A.
| ||||||||
Base salary is the fixed portion of an executive’s annual compensation, providing some stability of income since the other compensation elements are at risk. Our Compensation Committee annually reviews and approves the base salary levels for our executive officers (other than the CEO) after considering comparable salaries for executives with similar responsibilities in our main executive compensation peer groups, comparisons to internal peer positions, recent Company performance, individual performance, business experience and potential, and the CEO’s recommendations. The Committee annually reviews the base salary of our CEO in executive session and recommends his base salary amount to the independent members of the Board for approval, based on the criteria described above.
In January 2021,2022, our Compensation Committee reviewed the base salaries of each of our NEOs in line with the factors described above,above. Based on comparative market data and other factors, the Committee determined to maintain the base salaries of all NEOsMr. Al Mogharbel, Mr. Belani, Mr. Merad, and Ms. Ralston at their then-current levels for 2021.2022, and approved an increase to Mr. Biguet’s 2022 base salary from $770,000 to $800,000. In evaluating Mr. Le Peuch’s 2022 compensation, the Committee considered SLB’s strong 2021 financial results, and that Mr. Le Peuch’s 2021 total direct compensation was below the median of our general industry peer group and below his peers’ compensation at our two largest energy services competitors. In light of these factors, as well as SLB’s leading position in the energy services industry, the Committee recommended, and the independent members of the Board approved, an increase to Mr. Le Peuch’s base salary for 2022 from $1,400,000 to $1,550,000.
In April 2022, in connection with Mr. Merad’s promotion to the role of EVP, Core Services and Equipment, and in light of internal pay equity considerations, the Committee approved an increase to Mr. Merad’s base salary from $750,000 to $800,000, effective April 1, 2022.
We pay performance-based annual cash incentives to our executives to foster a results-driven, pay-for-performance culture, and to align executives’ interests with those of our stockholders.shareholders. Annual cash incentive awards are earned according to the achievement of financial and strategic personal objectives. Our Compensation Committee selects performance measures that it believes support our strategy and strike a balance between motivating our executives to increase near-term financial and operating results and driving profitable long-term Company growth and value for stockholders.shareholders.
For 2021,2022, 70% of our NEOs’ target cash incentive opportunity was based on achieving quantitative Company financial objectives, and 30% was based on pre-established strategic personal objectives, consistent with our 2020 cash incentive plan. As reflected in the following chart, the 70%objectives. The financial portion of the target plan was evenly split between goals relating to adjusted EBITDA and free cash flow generation.
2021 Cash Incentive Opportunity Mix
The Committee determined to give the two financial metrics equal weighting in the 2021 cash incentive plan, by increasing the adjusted EBITDA component to 35% (from 30%) of the target opportunity and decreasing the cash flow generation component to 35% (from 40%) of the target opportunity, in order to balance these two key financial goals as the Company enters a growth cycle.
performance goals. The total maximum cash incentive payout for 20212022 was 200% of target. Thetarget—consistent with our 2021 target cash incentive for our CEO was 150% of his base salary plan—and for our other NEOs it was 100% of base salary, consistent with 2020. Thethe weighted payout range for each metric as a percentage of target is reflected by the outer bars in the table above.2022 Cash Incentive Opportunity Mix chart.
2022 Cash Incentive Opportunity Mix
Our Compensation Committee considered the followingfactors in the table below, in selecting adjusted EBITDA and free cash flow generation as the absolutequantitative financial performance measures on which to base the 70% financial portion offor our NEOs’ annual2022 cash incentive opportunity:plan.
• The Committee considers adjusted EBITDA to • Investors and market analysts often value
• A portion of our line management’s | •
• Free cash flow has been critical to achieving our net debt reduction goals over the past several years. In line with our external commitments, by year-end 2022 we had reduced our net-debt-to-adjusted-EBITDA ratio to 1.4x. • The Committee also considers free cash flow |
36 | 2023 Proxy Statement |
In setting Company financial targets and performance goals, as well as our NEOs’ strategic personal objectives, the Committee believes it is important to establish criteria that are realistic,realistically attainable, yet still challenging in an uncertain global economy. In addition, in establishingapproving free cash flow generationperformance goals for the 20212022 cash incentive plan, the Committee considered that these goals differ substantiallyin important ways from the free cash flowFCF margin goals contained in the LTI portion of our NEOs’ compensation program. This is becauseWhereas the annual cash incentive portion focuses solely on the absolute amount of free cash flow we generate over a one-year period, and takes into account, among other things, cash paid for acquisitions and investments, as well as cash proceeds generated from divestitures, none of which are taken into account in the free cash flow margin metric contained in our LTI awards. Our free cash flowFCF margin PSU payout is calculated as free cash flow divided by our revenue over a three-year period. Because free cash flowFCF margin measures how efficiently we convert revenue into cash, it is a good indicator of the business’s ability to generate cashhigh-quality revenue over the long term and, therefore, is a complementary metric to the free cash flow generation metric in our annual cash incentive program.
In January 2021, upon review of market data indicating that our NEOs’ target annual cash incentive opportunity was competitively positioned, and taking into consideration internal pay equity, our Compensation Committee determined to leave the target annual cash incentive opportunity for all NEOs unchanged from 2020.
ConsistentThe process used to set annual adjusted EBITDA targets starts with its 2020 process,a review of plans and projections following bottom-up planning from the field. Adjusted EBITDA targets may increase or decrease year-over-year, taking into account, among other things, our cash requirements, industry cycles, anticipated customer spending, activity growth potential, pricing, the introduction of new technology, strategic M&A activity, and commodity prices.
Based on the foregoing, in January 2021 our Compensation Committee approved an adjusted EBITDA performance matrix informed by market analysts’ consensus estimates of our full-year 2021 adjusted EBITDA as reported on Bloomberg prior to2022 the Committee’s meeting (“EBITDA consensus”). The Committee set the minimum performance goal equal to then-current12% higher than SLB’s actual 2021 adjusted EBITDA consensus, aresults. The Committee set the target performance goal based on our then-current internal forecast, at 6% above EBITDA consensus,which was 11% higher than the minimum goal and a24% higher than our actual 2021 results, and set the maximum performance goal at 15% above EBITDA consensus.higher than target and 42% higher than our actual 2021 results. The Committee believed that setting the target andan aggressive maximum performance goals above EBITDA consensusgoal would incentivizemotivate our executives to significantly outperform market expectations. expectations and our internal forecast.
The following charttable reflects our NEOs’ full-year adjusted EBITDA targets and corresponding potential payouts for 2021.2022.
Performance Targets(1) | Potential Payout as a % of Target Opportunity(1) | ||||||
Less than | 0% | ||||||
$ | Minimum | 50% | |||||
$ | Target | 100% | |||||
$ | Maximum | 243% |
(1) | For adjusted EBITDA results between any two performance targets, payout is prorated. No cash incentive is earned if we do not achieve the minimum adjusted EBITDA target. |
Our 20212022 adjusted EBITDA was $4.925$6.462 billion, representing a 14%31% increase over 2020 and2021. As a 13% increase over full-year EBITDA consensus as of January 2021. Based on these results,result, and applying the payout matrix on page 39 immediately above, our Compensation Committee approved a payout of 89%157% of target—or 65% of the maximum payout opportunity opportunity—for the adjusted EBITDA component of our 20212022 cash incentive plan.
For a reconciliation of adjusted EBITDA to net income attributable to Schlumberger on a GAAP basis, see Appendix A. In approving the payout for 2021 adjusted EBITDA performance, the Committee reaffirmed its decision to calculate adjusted EBITDA results consistently with the Company’s presentation of adjusted EBITDA results in its 2021 earnings announcements and presentations to investors and with analysts’ calculation of their estimates.
The process used to set annual free cash flow generation targets starts with a review of plans and projections following bottom-up planning from the field. CashFree cash flow generation targets may increase or decrease year-over-year, taking into account among other things, our operating and non-operating cash requirements, industry cycles, anticipated customer spending, activity growth potential, pricing, the introduction of new technology, strategic M&A activity, and commodity prices.
same factors listed above for adjusted EBITDA. The following table reflects our NEOs’ full-year free cash flow generation targets and corresponding potential payouts for 2021,2022, as approved by our Compensation Committee in January 2021. The Committee believed the minimum performance goal would incentivize management to generate sufficient cash to cover the Company’s various 2021 cash commitments, including the full-year cash dividend payout amount, as well as our planned reduction of net debt. The Committee set the target performance goal using our internal full-year 2021 cash flow generation forecast, which included key investments in new energy and digital. The Committee believed the maximum performance goal—set 22% above the target goal—would incentivize management to generate additional cash to allow us to accelerate our net debt reduction.2022.
Performance Targets(1) | Potential Payout as a % of Target Opportunity(1) | ||||||
Less than | 0% | ||||||
$2.30 billion | |||||||
$ | 100% | ||||||
$3.20 billion |
(1) | For free cash flow |
The Committee recognized thatset the 2021 target performance goal based on our then-current internal free cash flow forecast for 2022, which was set below 2020’s15% higher than our target cash flow generation result; however, in settinggoal from the prior year. The Committee believed the above performance goals appropriately reflected a change in January 2021, the Committee believed this was appropriate taking into account:
industry cycle, because execution of SLB’s strategy in 2022 and outperformance through the upcycle would require increased capital investment in line with anticipated activity increases.
Given the Company’s capital discipline and working capital management performance in 2021, including exceptional cash collections from customers in the fourth quarter, full-yearOur 2022 free cash flow generation exceeded the maximum performance goal. Our 2021was $1.418 billion. Because we did not achieve our threshold free cash flow generated was $3.000 billion, representing a 12% increase over 2020. As a result,performance target, our CEO and other NEOs earned no payout under the Company was able to accelerate its deleveraging and reduce net debt by $2.8 billion during 2021. Based on the Company’s 2021free cash flow generation results, and applying the payout matrix above, our Compensation Committee approved a payout of 100% of the maximum payout opportunity for the cash flow generation component of our 20212022 cash incentive plan.
In approving cash flow generation as a performance metric, our Compensation Committee believed that it was appropriate to exclude from any cash flow generation calculations acquisitions requiring cash investments and divestitures generating proceeds in excess of $500 million. This is because the Committee considered that such transactions would be enterprise-level transactions that should be evaluated and pursued independently, and should not be tied to annual cash incentive payouts.
Based on the foregoing, and for purposes of the 2021 cash incentive payouts, the Committee approved the following formulation for measuring our cash flow generation: cash flow from operations; less capital expenditures, investments in Asset Performance Solutions (“APS”), and multiclient seismic data costs capitalized; less cash paid for business acquisitions and investments, net of cash acquired, provided that the purchase price for each of the individual transactions is less than $500 million; plus proceeds from the divestiture of businesses or assets, net of cash divested, provided that the proceeds from each of the individual transactions is less than $500 million. For a reconciliation of cash flow generation to cash flow from operations, see Appendix A.
37 |
The following table reflects our NEOs’ 2022 strategic personal objectives and their achievements against those performance goals.
Performance Goal | Achievement | ||||||
Strategic Planning and Sustainability | |||||||
Reduce SLB’s Scope 3 emissions, using a pre-established CO2e target based on “customer-avoided” emissions. These avoided emissions are driven by sales from our Transition Technologies portfolio, which helps us and our customers reduce carbon emissions while strengthening our commercial model. | Achieved | ||||||
Oversee completion and roll-out of near- and mid-term corporate strategy, in line with sustainability and New Energy priorities. | Achieved | ||||||
Launch M&A program aligned with near- and mid-term corporate portfolio strategy based on scenario planning. | Achieved | ||||||
Oversee enhancements to our carbon emissions reporting, due diligence, internal controls, and auditing processes, and meet related quantitative milestones. | Achieved | ||||||
Digital Growth and Technology Innovation | |||||||
Increase digital revenue—enabled by digital penetration—above a pre-established target. | Substantially achieved | ||||||
Secure a minimum number of technology access projects exceeding a threshold contract value. | �� | Partially achieved | |||||
Accelerate development of new technologies, Transition Technologies and fit-for-basin technologies, based on a specified revenue target. | Achieved | ||||||
Core Growth | |||||||
Increase revenue generated from fit-for-basin technologies above a pre-established target. | Achieved | ||||||
Increase total revenue year over year by a target percentage exceeding the rig count increase. | Achieved | ||||||
Achieve international revenue growth as a percentage exceeding that of direct competitors. | Achieved | ||||||
New Energy Innovation | |||||||
Oversee development of near- and mid-term New Energy growth strategy, as well as revenue and market analysis. | Achieved | ||||||
Secure a minimum number of large carbon capture and sequestration projects, and execute identified key partnerships and acquisitions. | Substantially achieved | ||||||
Achieve certain milestones in other New Energy ventures. | Substantially achieved | ||||||
HSE Performance | |||||||
Fatality-free. | Mostly not achieved | ||||||
% of 2022 payout opportunity earned under strategic personal objectives | 93% | 88% | 88% | 79% | 75% | 76% |
38 | 2023 Proxy Statement |
As discussed on page 36 above, 30% of our NEOs’ target 20212022 cash incentive opportunity was tied to achieving quantitative and qualitative performance goals specific to their roles with the Company.within SLB. These may relate to: financial goals, such as profitability, revenue growth, capital management or cost reduction; performance achievements, such as contract awards or operational reliability or HSE objectives; non-financial or sustainability-related goals that are important to SLB’s strategy and reputation, such as carbon emissions reduction, ethics and compliance, or people-related objectives including diversity and gender balance; and other business priorities, including energy transition services and technologies.
For 2021, the strategic personal objectives established for our NEOs, and their achievements against those goals, were as follows:
Each January, our Compensation Committee reviews and, subject to approval by the Board’s independent directors, approves our CEO’s strategic personal objectives for that year. The Committee also annually assesses our CEO’s performance against his strategic personal objectives established for the prior year, to determine the appropriate payout for the 30% portion of his annual cash incentive opportunity tied to his personal objectives. The CEO reviews and approves the strategic personal objectives of the other NEOs and assesses their performance against their pre-approved objectives in a similar way. The Committee annually approves the aggregate annual cash incentive payouts for all executive officers, including the payout portion related to an executive’s strategic personal objectives.
In January 2022, our Compensation Committee determined to leave the target annual cash incentive opportunity for all NEOs unchanged from 2021, following a review of market data indicating that our NEOs’ target annual cash incentive opportunity (as a percentage of base salary) was competitively positioned. As a result, the 2022 target cash incentive for our CEO was 150% of his base salary and for our other NEOs it was 100% of base salary. The following table reflects our NEOs’ full-year 2022 annual cash incentive results, together with relevant weightings of the different components and payouts under each component.
Financial Objectives | Personal Objectives | |||||||||||||||||||||||||||||||
Incentive | Adjusted EBITDA | Free Cash Flow | Total 2022 | |||||||||||||||||||||||||||||
Name | Opportunity as % of Base Salary | Weight (%) | Payout Result (%) | Weight (%) | Payout Result (%) | Weight (%) | Payout Result (%) | Incentive Paid as % of Target | (1) | |||||||||||||||||||||||
O. Le Peuch | 150 | % | 35 | 157 | 35 | 0 | 30 | 93 | 83 | % | ||||||||||||||||||||||
S. Biguet | 100 | % | 35 | 157 | 35 | 0 | 30 | 88 | 81 | % | ||||||||||||||||||||||
K. Al Mogharbel | 100 | % | 35 | 157 | 35 | 0 | 30 | 88 | 81 | % | ||||||||||||||||||||||
A. Merad | 100 | % | 35 | 157 | 35 | 0 | 30 | 79 | 79 | % | ||||||||||||||||||||||
D. Ralston | 100 | % | 35 | 157 | 35 | 0 | 30 | 75 | 78 | % | ||||||||||||||||||||||
A. Belani(2) | 100 | % | 35 | 157 | 35 | 0 | 30 | 76 | 78 | % |
(1) | Equals the sum of the financial and strategic personal portions of the annual cash incentive achieved, shown as a percentage of base salary. | |
(2) | Prorated for the three-month period that Mr. Belani served as EVP, New Energy. |
LTI awards are designed to give NEOs and other high-value employees a long-term stake in the Company,SLB, incentivize the creation of sustained stockholdershareholder value, and act as long-term retention and motivation tools, and aligntools—aligning employee and stockholdershareholder interests over the long term.
In JanuarySince 2021, our Compensation Committee approved changes to our LTI award mix. In reviewing the design of the 2021 LTI program for our executive officers, and considering feedback from our stockholders in 2019 and 2020, as well as the Committee’s previous pay-for-performance assessments, the Committee determined that the program should:
Based on these considerations, in January 2021, the Committeehas awarded to our NEOs and other executives a diversified mix of LTI grants, with 75% of their target LTI opportunity awarded in the form of PSUs—with payout contingent on achieving absolute and relative Company performance goals over three-year periods—and 25% awarded in the form of three-year, time-based RSUs. The Committee believes this diversifiedthat our current LTI grant program betterappropriately balances the various compensation objectives set forth in this section.following Committee objectives:
In considering the reduced risk of time-based RSUs as a new component of our LTI program, the Committee also set the maximum overall payout opportunity under the 2021 LTI program at 200% of target—significantly lower than the 250% maximum under the 2020 LTI program, in line with market practice.
• | closely aligning PSU performance metrics with our long-term strategy, publicly disclosed financial objectives, and total shareholder return, | |
• | aligning pay-for-performance and creating shareholder value, | |
• | maintaining a mix of absolute and relative PSU metrics, in light of the cyclicality of our industry, | |
• | motivating and incentivizing outperformance relative to our direct competitors and the broader energy sector, and | |
• | promoting the stability and retention of our executive team through business cycles with awards of time-based RSUs. |
39 |
TheAs in 2021, the 2022 LTI program consisted of four types of grants, equally weighted at target performance:
2021 LTI Program
| ||||
The maximum overall payout opportunity under the 2022 LTI program was 200% of target—consistent with 2021 and in line with market practice. The maximum payout opportunity for each type of LTI award is reflected by the outer bars in the chart above.
For details regarding LTI grants made to our NEOs in 2019 and 2020, see “—Payouts Under Prior LTI Awards” beginning on page 43.
The value of an executive’s LTI grant increases with thetheir level of responsibility at the Company.SLB. For our CEO and the other NEOs, it is the largest element of their compensation. In determining the value of LTI awards granted to our NEOs, our Compensation Committee (in recommending that the Board approve the CEO’s awards) and the CEO (in recommending awards for the other NEOs) first consider market data regarding the LTI value for the most comparable positions in our main executive compensation peer groups, as well as several other factors, such as:
• | ||
• | the | |
• | internal pay | |
• | ||
• | ||
the executive’s contribution to | ||
• | the level of competition for executives with comparable skills and | |
In January 2021,2022, our Compensation Committee approved (and inreviewed the case of Mr. Le Peuch, the independent members of the Board approved)target annual LTI awards to each of our NEOs in line with the NEOs as reflectedfactors described in the table on the following page.this section. Based on its review of comparator peer group data and internal pay equity considerations, the Committee determined to hold annual target LTI grant values flat for Messrs.Mr. Al Mogharbel, Mr. Belani, and Ms. Ralston. The Committee approved an increase in Mr. Biguet’s 2022 target LTI grant date fair value from $3.2 million to $3.5 million, after considering SLB’s strong financial performance in 2021 and that Mr. Biguet’s 2021 compensation was below his peers’ compensation at our two largest energy services competitors, as well as internal equity factors.
In evaluating Mr. Le PeuchPeuch’s target LTI award in January 2022, our Compensation Committee considered the success of the Company’s returns-focused strategy and Belani.execution in the prior year, as well as SLB’s strong 2021 financial results—which surpassed all of the Company’s annual financial targets. The Committee also considered that Mr. Le Peuch’s 2021 compensation was below his peers’ compensation at our two largest energy services competitors, and below the median of our general industry peer group. In addition, based on comparator peer group datalight of these factors, as well as SLB’s leading position in the energy services industry, the Compensation Committee recommended, and the independent members of the Board approved, an increase in Mr. Le Peuch’s 2022 target LTI grant date fair value from $10.5 million to $12 million.
In April 2022, in connection with Mr. Merad’s promotion to the role of EVP, Core Services and Equipment, and in light of internal pay equity considerations, the Committee approved an increase in Mr. Biguet’s annualhis 2022 target LTI dollar value from $2.5 million to $3.2 million. Lastly, based on internal pay equity considerations, as well as adjusted responsibilities following the Company’s 2020 restructuring, the Committee approved a decrease in Mr. Al Mogharbel’s annual target LTI dollar value from $3.72 million to $3.5 million, and an increase in Ms. Gharbi’s annual target LTI dollargrant date fair value from $3.2 million to $3.5 million.
2023 Proxy Statement |
The following table details the number of PSUs (at target) and RSUs granted to our NEOs in 2021 and the estimated target values of our NEOs’ 2021 and 2020 LTI awards, as well as the year-over-year percentage change between the two amounts.
Name | Target Number of FCFM PSUs | Target Number of TSR PSUs | (1) | Target Number of ROCE PSUs | Number of RSUs | Target Value for 2021 LTI | (2) | Target Value for 2020 LTI | (3) | % Change | |||||||
O. Le Peuch | 110,290 | 96,440 | 110,290 | 110,290 | $10,500,000 | $10,500,000 | (4) | 0% | |||||||||
S. Biguet | 33,610 | 29,390 | 33,610 | 33,610 | $3,200,000 | $2,500,000 | 28% | ||||||||||
K. Al Mogharbel | 36,760 | 32,150 | 36,760 | 36,760 | $3,500,000 | $3,720,000 | (6)% | ||||||||||
H. Gharbi | 36,760 | 32,150 | 36,760 | 36,760 | $3,500,000 | $3,200,000 | 9% | ||||||||||
A. Belani | 37,820 | 33,060 | 37,820 | 37,820 | $3,600,000 | $3,600,000 | 0% |
2021
In January 2021,2022, our Compensation Committee set goals for the new 20212022 FCF Margin PSUs based on our absolute free cash flowFCF margin over a three-year performance period (January 1, 20212022 to December 31, 2023)2024). At the end of the performance period, the Committee will certify our three-year cumulative absolute free cash flowFCF margin and then determine the percentage of shares earned based on the graph below.
20212022 FCF Margin PSU Payout Matrix
The number of 20212022 FCF Margin PSUs that will vest and convert to shares as of the vesting date can range from 0% to 250% of target, depending on our absolute free cash flowFCF margin performance over the three-year period, but in no event will payout relating to this metric exceed 250% of target.
For 2022, the Committee increased the maximum performance goal for the FCF margin PSUs to 12.0%, to reflect SLB’s strong free cash flow performance in the prior year. In maintaining the other performance goals for these PSUs consistent with 2021, the Committee believed that the target performance goal was conservative with respect to capital consumption, while not being overly aggressive so as to disincentivize investment in growth and planned working capital increases in line with anticipated activity increases. As illustrated in the graph above, no SLB shares of our common stock will be earned if our free cash flowFCF margin over the three-year performance period is less than the minimum performance goal of 9.0%. In setting this minimum goal, the Committee considered that the Company’s three-year cumulative free cash flow margin, averaged from 2009 to 2020, was 8.6%. Therefore, the Company would need to exceed these historical margin results in order for any 2021 FCF Margin PSUs to vest.
Free cash flowFCF margin is calculated as free cash flow divided by revenue. Free cash flowFCF margin measures how efficiently we convert revenue into free cash flow, and is an indicator of capital efficiency. In selecting absolute free cash flowFCF margin as the performance metric for 25% of our NEOs’ 20212022 target LTI dollargrant date fair value, the Committee considered that this metric was aligned with our capital allocation strategy and publicly disclosed financial objective of achieving double-digit free cash flowFCF margin. The Committee also believes that tying a portion of our NEOs’ LTI payout to free cash flowFCF margin encourages our executives to:
• | ||
maintain capital discipline, | ||
• | generate sufficient cash flow to allow for increased returns to shareholders and net debt reduction, | |
• | make key investments and capital expenditures in line with our stated strategy, including our energy transition strategy, and | |
• | increase |
The Committee also sought to maintain a mix of absolute (free cash flow(FCF margin) and relative (ROCE and TSR) metrics in our NEOs’ PSU awards, to effectively manage industry cycles.
For purposes of the 2021 FCF Margin PSUs, freeFree cash flow represents cash flow from operations less capital expenditures, Asset Performance Solutions investments in APS projects, and multiclient seismicexploration data costs capitalized. For a reconciliation of free cash flow to cash flow from operations, see Appendix A.
2021
2023 Proxy Statement | 41 |
In January 2021,2022, our Compensation Committee set goals for the new 2021 TSR PSUs based on our relative TSR percentile rank, as compared to the cumulative TSR results achieved by eight companies of similar size and footprint in our industry over a three-year performance period (January 1, 2021 to December 31, 2023) (each, a “TSR comparator company”). At the end of the performance period, our Compensation Committee will certify the three-year, cumulative TSR results for us and for each TSR comparator company, based on the average of the last 20 trading days at the start and end of the performance period. The Committee will then determine our percentile rank relative to the TSR comparator companies, as well as the percentage of shares earned based on the table below.
The number of 2021 TSR PSUs that will vest and convert to shares as of the vesting date can range from 0% to 200% of target, depending on our relative TSR performance, but in no event will payout relating to this metric exceed 200% of target. In setting the maximum payout opportunity for the 2021 TSR PSUs at 200%, which is below the maximum payout for the 2021 FCF Margin PSUs and 2021 ROCE PSUs, the Committee considered that management’s efforts would more directly affect free cash flow margin and ROCE, whereas management had less control over the Company’s TSR relative to that of the TSR comparator companies, due to external market and economic influences.
As illustrated by the table in this section, the Compensation Committee set the target performance goal above median at the 60th percentile—requiring performance better than five of the eight TSR comparator companies to achieve target payout. No shares of our common stock will be earned if our three-year, cumulative TSR is in the bottom 25th percentile rank as compared to that of the individual TSR comparator companies.
In selecting the TSR comparator companies for the 2021 TSR PSUs, the Committee focused on companies in the energy sector of generally similar revenue, market capitalization and footprint to Schlumberger. This is because the Committee believes that, in evaluating our relative TSR performance, the most appropriate comparisons are against companies in the energy sector affected by the same external factors as we are. The TSR comparator companies for the 2021 TSR PSUs are: Apache Corporation, Baker Hughes, ConocoPhillips, Halliburton, Hess Corporation, NOV Inc. (NOV), Occidental Petroleum, and TechnipFMC. Four of the TSR comparator companies are included in the ROCE comparator group for the 2021 ROCE PSUs, and six are included in our oil industry peer group, as discussed further under “—Other Aspects of Our Executive Compensation Program—Our Peer Group Companies” beginning on page 49 of this proxy statement. For purposes of calculating the vesting of the 2021 TSR PSUs, any TSR comparator company that is acquired will be removed from the percentile rankings, and any company that files for bankruptcy will be deemed to have achieved the lowest ranking three-year TSR result.
2021 Relative ROCE PSUs — Performance Measures and Goals
In January 2021, our Compensation Committee set goals for the 2021 ROCE PSUs based on our average annual ROCE over a three-year performance period (January 1, 20212022 to December 31, 2023)2024), as compared to the average annual ROCE of the following oilfield servicesdirect competitors, taken together over the same period: Halliburton, Baker Hughes, TechnipFMC, and NOV (collectively,(together the “ROCE comparator group”). At the end of the performance period, the Committee will certify our average ROCE and that of the ROCE comparator group as a whole, and then determine the percentage of shares earned based on the graph below.
20212022 Relative ROCE PSU Payout Matrix
The number of 20212022 ROCE PSUs that will vest and convert to shares as of the vesting date can range from 0% to 250% of target, depending on our relative ROCE performance over the three-year period, but in no event will payout relating to this metric exceed 250% of target. As illustrated in the graph above, consistent with the ROCE PSUs granted in 2020:2021:
• | If our average annual ROCE over the three-year performance period is four percentage points or more below the average of the ROCE comparator group, then no | |
• | If our average annual ROCE over the three-year performance period is equal to that of the average of the ROCE comparator group as a whole, then the | |
• | In addition, if both (x) our absolute, single-year ROCE is greater than 10% in |
ROCE is a measure of the efficiency of our capital employed, and is a comprehensive indicator of long-term Company and management performance, measured in a way that is tracked and understood by many of our investors. Our Compensation Committee has based a portion of our NEOs’ LTI awards on a relative ROCE metric since 2016 because this metric allows us to directly compare how efficiently we deploy our capital against our key oilfield servicesdirect competitors. The Committee also believes that tying a portion of our executives’ LTI payout to achieving our capital efficiency goals and comparing these results to our competitors will motivate our executives to focus on performance,outperformance, and will result in increased revenue and improved margins. In selecting ROCE as the performance metric for 25% of our NEOs’ 20212022 target LTI dollargrant date fair value, the Committee also considered that ROCE performance goals align executives’ potential ROCE PSU payouts with the Company’sSLB’s goal of achieving absolute ROCE above the Company’sits weighted average cost of capital.
We calculate ROCE as a ratio, the numerator of which is (a) net income from continuing operations, excluding charges and credits, plus (b) after tax net interest expense, and the denominator of which is (x) stockholders’ equity, including non-controlling interests (average of beginning and end of each quarter in the year), plus (y) net debt (average of beginning and end of each quarter in the year). Our Compensation Committee has discretion to cap payouts on the 20212022 ROCE PSUs at 100% of target in the event of material asset impairments attributable to M&A transactions and other management decisions.
2023 Proxy Statement |
In January 2022, our Compensation Committee set goals for the 2022 TSR PSUs based on our relative TSR percentile rank, as compared to the cumulative TSR results achieved by the four direct competitors used for the 2022 ROCE PSUs, plus the S&P Global 1200 Energy Index as a fifth comparator (each a TSR comparator), over a three-year performance period (January 20, 2022 to December 31, 2024). At the end of the performance period, the Committee will certify the three-year, cumulative TSR results for us and for each TSR comparator, based on the average of the 20 trading days prior to the start and end of the performance period. The Committee will then determine our percentile rank relative to the five TSR comparators, as well as the percentage of shares earned based on the table below.
Relative TSR Percentile Rank | Performance Targets | % of Target Shares Earned (Payout %)(1) | ||
Below 25th percentile | 0% | |||
25th percentile | Minimum | 25% | ||
60th percentile | Target | 100% | ||
100th percentile | Maximum | 200% |
(1) | Number of shares determined by straight-line interpolation between performance levels. |
As in 2021, the number of 2022 TSR PSUs that will vest and convert to shares as of the vesting date can range from 0% to 200% of target, depending on our relative TSR performance over the three-year period, but in no event will payout relating to this metric exceed 200% of target. In maintaining the maximum payout opportunity for the 2022 TSR PSUs at 200%, which is below the maximum payout for the 2022 FCF Margin PSUs and 2022 ROCE PSUs, the Committee considered that management’s efforts would more directly affect FCF margin and ROCE, whereas management had less control over SLB’s TSR relative to that of the TSR comparator companies, due to external market and economic influences.
As illustrated by the table in this section, our Compensation Committee set the target performance goal above median at the 60th percentile, consistent with 2021. No SLB shares will be earned if our three-year, cumulative TSR is in the bottom 25th percentile rank as compared to that of the individual TSR comparator companies.
Target set above median relative TSR performance |
In January 2022, our Compensation Committee reviewed the peer companies used to assess relative TSR performance under our LTI program, based on market data and a TSR correlation analysis prepared by Pay Governance. Following this review, the Committee adjusted the TSR comparator group as compared to 2021, to better focus on outperformance relative to our direct competitors and the broader energy market. For 2022, the Committee assessed our relative performance under both our TSR PSUs and our ROCE PSUs against Halliburton, Baker Hughes, TechnipFMC, and NOV, because it believes the most appropriate TSR and ROCE comparisons are against our direct competitors in the energy services industry. The Committee included a fifth comparator for the 2022 TSR PSUs—the S&P Global 1200 Energy Index—based on shareholder feedback that our investors also evaluate our TSR performance against the broader energy sector.
Stock Options
Prior to 2017, the Company hadSLB granted a significant portion of its LTI compensation to executives in the form of stock options. Beginning in 2017, SLB ended its practice of granting stock options to executive officers. As of December 31, 2021,2022, all of our executives’NEOs’ outstanding stock options were “underwater.”
PSUs Vesting in 20212022
As previously disclosed in the proxy statement for our 20212022 AGM, in January 20212022 our Compensation Committee approved the relative ROCEpayout results for the PSUs issued to our NEOs in 2018. The2019, based on the Committee’s previously approved performance criteria. Our NEOs earned 250% of target under the free cash flow conversion PSUs issued in 2019, based on our achievement of a cumulative free cash flow conversion rate of 166% for the two-year performance period applicable to those PSUs. In addition, our NEOs earned 182% of target under the relative ROCE PSUs issued in 2018 were earned at 134% of target,2019, based on our average annual ROCE over the three-year performance period being 173327 basis points above the average annual ROCE of five key oilfield servicesof our direct competitors taken together over the same period. These competitors were Halliburton, Baker Hughes, TechnipFMC, Weatherford International, and NOV (the “prior ROCE comparator companies”). For additional details, see the Option Exercises and Stock Vested in 20212022 table on page 5854 of this proxy statement.
PSUs Vesting in 20222023
In January 2019,2020, our Compensation Committee approved PSU awards to our NEOs (other than the CEO) as follows, in each case subject to a three-year relative TSR modifier:
• | With respect to 50% of our NEOs’ | |
• | With respect to 50% of our NEOs’ |
Our CEO, Mr. Le Peuch, did not receive an LTI award in 2020 because he had received a PSU award in 2019 in connection with his promotion to CEO, in lieu of a 2020 award.
2023 Proxy Statement | 43 |
In January 2021,2022, the Committee determined that we achieved a cumulative free cash flow conversion rate of 166%192% for the two-year performance period applicable to the 20192020 FCF Conversion PSUs, representing achievement of 250% of target, based on the Committee’s previously approved performance criteria. At the time, theseThese PSUs remainedalso were subject to the relative TSR modifier, which would have caused payouts to be reduced by 25% if our three-year, cumulative TSR was in the bottom 33rd percentile rank as compared to the individual companies comprising the Philadelphia Oil Services Sector index as of January 2019.2020. In January 2022,2023, the Committee determined that the relative TSR modifier did not trigger a negative adjustment to the 20192020 PSU payouts, because Schlumberger’sSLB’s TSR ranked at the 8985th percentile. As a result, in January 2022,2023, our NEOs (other than the CEO) earned 250% of target under the 20192020 FCF Conversion PSUs.
In January 2022,2023, the Committee also approved the results for the 20192020 ROCE PSUs using the Committee’s previously approved performance criteria. Specifically, the Committee determined that in 2022, SLB had achieved absolute, single-year ROCE of 13%—as a result, the 20192020 ROCE PSUs had been earned at 182%250% of target, based on Schlumberger’sSLB’s average annual ROCE being 327407 basis points above the average of the prior ROCE comparator companies through the third quarter of 2021,2022, which was the then-most recent fiscal period end reported by all the prior ROCE comparator companies. Because not all the prior ROCE comparator companies had reported their 20212022 audited results as of January 2022,2023, the Committee approved a preliminary issuance of 90%80% of the shares earned under the 20192020 ROCE PSUs. Any additional shares finally determined to have been earned by our NEOs (other than the CEO) will be issued after all the prior ROCE comparator companies disclose their full-year 20212022 audited results.
Unvested PSU AwardsPSUs
In January 2020, our Compensation Committee approved PSU awardsAll of the PSUs granted to our NEOs (other than the CEO),since 2021 will vest, if at all, of which are subject toonly after a three-year relative TSR modifier and therefore remain unvested.performance period. At the end of allthe applicable performance periods, the Committee will determine the number of shares ultimately earned under these PSUs.unvested PSUs based on the extent of achievement of the applicable performance goals.
In 2020, ourOur Compensation Committee has approved guidelines covering, among other things, LTI vesting, salary, benefits, and other compensation matters for officers departing the Company,SLB, either because they are eligible for retirement, early retirement or special retirement, or because they are involuntarily terminated (if not eligible for retirement). These guidelines are a non-binding framework for management’s referencereferenced by management in its executive succession planning, with flexibility as required by specific situations.
Under the guidelines, we may, at our discretion, enter into agreements with outgoing officers whereby they would remain employed by the CompanySLB during the agreement term and would receive annual cash payments that would generally be less than their pre-termination annual base salary. In addition, outgoing officers would receive a prorated cash incentive award payment with respect to the year of their departure. They would also receive benefits such as medical coverage and life and disability insurance during the agreement term, and would continue to vest in previously granted LTI awards, awards—but would not receive any new LTI awards awards—during the term. In exchange, the outgoing officers must agree to non-competition, non-solicitation, and non-disparagement covenants, and generally would agree to be available to SchlumbergerSLB for 50%a portion of their business time during the term,term.
As previously disclosed in the proxy statement for our 2022 AGM, SLB entered into an agreement with Mr. Belani in connection with his decision to retire from his role as SLB’s EVP, New Energy, effective as of April 1, 2022. Under the terms of the agreement, Mr. Belani currently serves as Senior Strategic Advisor to our CEO through March 31, 2024, supporting certain technology and agreeinnovation projects. Mr. Belani has also agreed to certain restrictive covenants under the agreement, including three-year non-competition and non-solicitation undertakings, as well as confidentiality and non-disparagement covenants.undertakings and a waiver and release of claims.
In consideration for his services as Senior Strategic Advisor, the restrictive covenants, and the waiver and release, Mr. Belani will continue to receive certain benefits and payments through March 31, 2024, including a cash payment in each year of the term equal to his base salary prior to retiring from his EVP role. During the term, he will also continue to participate in our health, welfare, and insurance plans for which he is eligible as an employee, and will continue to accrue benefits under our pension and profit-sharing plans. In addition, because Mr. Belani remains an employee and qualifies for retirement treatment under the terms of our LTI award agreements, his outstanding LTI awards will continue to vest in accordance with the terms applicable to those grants.
As a global technology company driving energy innovation, we believe that our greatest competitive strengths are our people and our intellectual property. Mr. Belani led SLB New Energy from its launch in 2020 through March 2022, and prior to that, he served for over a decade as SLB’s Chief Technology Officer and EVP, Technology. He has critical knowledge about our technology and innovation strategy, important relationships with SLB New Energy’s strategic partners and joint ventures, and deep ties to the scientific community within SLB and externally. Thus, our Compensation Committee believed it to be in the best interest of SLB and our shareholders to enter into an agreement with Mr. Belani to secure his continued support on key technology and innovation projects where his expertise and significant contacts will benefit the advancement of SLB’s strategy. In addition, the agreement secures his covenant not to compete with us and prohibits him from soliciting key employees for a period of three years. If the undertakings in the agreement are breached, we may immediately stop payment of all cash amounts that would otherwise be due to Mr. Belani, all outstanding equity awards will be subject to cancellation, and we may require repayment of consideration previously paid or vested under the agreement.
2023 Proxy Statement |
We seek to provide benefit plans, such as medical coverage and life and disability insurance, on a country-by-country basis in line with market conditions. Where the local practice is considered to be less than the SchlumbergerSLB minimum standard, we generally offerenhance the Schlumberger standard.local plans to meet the SLB standard plan. Our NEOs are eligible for the same benefit plans provided to other employees, including medical coverage and life and disability insurance, as well as supplemental plans chosen and paid for by employees who wish to obtain additional coverage. There are no special insurance plans for our NEOs.
In line with Schlumberger’sour aim to encourage long-term careers with the CompanySLB and to promote retention, retirement plans are provided, where possible and according to local market practice, for all employees, including NEOs. For details regarding our pension plans and nonqualified deferred compensation plans, see “Executive Compensation Tables—Pension Benefits,” “—Nonqualified Deferred Compensation,” “—Potential Payments Upon Termination or Change in Control—Retirement Plans,” and “—Retiree Medical” and the accompanying narratives beginning on page 5854 of this proxy statement.
We provide only limited perquisites to our NEOs, which are identified in the footnotes to the Summary Compensation Table.
Schlumberger has entered into an agreement with Mr. Belani in connection with his decision to step down as Executive Vice President, Schlumberger New Energy, effective as of April 1, 2022 (the “Belani Agreement”). Under the Belani Agreement, Mr. Belani will serve as Senior Strategic Advisor to our CEO through March 31, 2024, to support certain technology and innovation projects. Mr. Belani has also agreed to certain restrictive covenants under the Belani Agreement, including three-year non-competition and non-solicitation undertakings, as well as confidentiality and non-disparagement undertakings and a waiver and release of claims.
In consideration for his services as Senior Strategic Advisor, the restrictive covenants, and the waiver and release, Mr. Belani will receive, for a two-year period: (1) an annual cash payment equal to his current base salary; (2) continued participation in our health, welfare and insurance plans for which he is eligible as an employee; (3) continued accrual of benefits under our pension and profit-sharing plans; and (4) a cash incentive award for 2022 prorated for the period worked until April 1, 2022, to be paid in early 2023 upon achievement of previously established personal and financial performance targets. In addition, because Mr. Belani is eligible for retirement under the terms of our LTI award agreements, his outstanding LTI awards will continue to vest in accordance with the terms applicable to those grants.
As a high-technology energy services company, we believe that our greatest competitive strengths are our people and our intellectual property. Mr. Belani has led Schlumberger New Energy and its portfolio of businesses in low-carbon and carbon-neutral energy technologies since its launch in 2020, and prior to that, served for over a decade as the Company’s Chief Technology Officer and Executive Vice President, Technology. He has critical knowledge about our technology and innovation strategy, important relationships with Schlumberger New Energy’s strategic partners and joint ventures, and deep ties to the scientific community within Schlumberger and externally. Thus, the Compensation Committee believed it to be in the best interest of the Company and our stockholders to enter into an agreement with Mr. Belani to secure his continued support on key technology and innovation projects where his expertise and significant contacts will benefit the advancement of the Company's strategy. In addition, the Belani Agreement secures his covenant not to compete with us and prohibits him from soliciting key employees for a period of three years. If the undertakings in the Belani Agreement are breached, we may immediately stop payment of all cash amounts that would otherwise be due to Mr. Belani, all outstanding equity awards will be subject to cancellation, and we may require repayment of consideration previously paid or vested under the agreement.
In addition, Schlumberger has entered into an agreement with Ms. Gharbi in connection with her decision to step down as Executive Vice President, Services and Equipment, effective as of May 1, 2022 (the “Gharbi Agreement”). Under the Gharbi Agreement, Ms. Gharbi agreed to certain restrictive covenants, including three-year non-competition and non-solicitation undertakings, as well as confidentiality and non-disparagement undertakings and a waiver and release of claims. Ms. Gharbi has also agreed to provide certain services to the Company during the term of the Gharbi Agreement.
In consideration for the restrictive covenants, the waiver and release, and the provision of certain services, Ms. Gharbi will receive: (1) for a three-year period, continued accrual of benefits under our pension and profit-sharing plans based on her 2022 base salary; and (2) a cash incentive award for 2022 prorated for the period worked until May 1, 2022, to be paid at target. In addition, the PSU and RSU awards previously granted to her in 2020 and 2021 will continue to vest in accordance with the terms applicable to those grants. Under the Gharbi Agreement, the PSU awards that Ms. Gharbi received in January 2022 are scheduled to vest at target in early 2025.
Ms. Gharbi has extensive strategic knowledge about Schlumberger and our industry, as well as strong relationships with key customers and partners. Thus, the Compensation Committee believed it to be in the best interest of the Company and our stockholders to enter into an agreement with Ms. Gharbi to secure her covenant not to compete with us and to prohibit her from soliciting key employees for a period of three years. If the undertakings in the Gharbi Agreement are breached, we may immediately stop payment of all cash amounts that would otherwise be due to Ms. Gharbi, all outstanding equity awards will be subject to cancellation, and we may require repayment of consideration paid or vested under the agreement.
A primary consideration of our Compensation Committee in overseeing our executive compensation program is the need to motivate and retain what it considers to bebelieves is the best executive talent in the energyour industry. We are the world’s leading provider ofa global technology to the globalcompany, driving energy industry,innovation for a balanced planet, and the Committee believes that delivering financial and operational outperformance and long-term stockholdershareholder returns depends on our ability to attract, develop, and retain the best talent globally. A highly competitive compensation package is critical to this objective.
In light of the foregoing,As a result, the Committee generally seeks to target total direct compensation for our NEOs between the 50th and 75th percentiles of our two main executive compensation peer groups; however, thegroups. The Committee may also position an NEO who is new to a position at or below the 50th percentile for a period of time. For example, the target value of our CEO’s 2021 total direct compensation places him at approximately the 50th percentile among CEOs in our general industry peer group. An NEO’s target total direct compensation depends on a variety of factors, including tenure in a particular position, individual and Company performance, and internal pay equity.
Competition for executive talent in our industry is exceptionally fierce. The Committee believes that the 50th to 75th percentile range is appropriate for us to target becausein light of Schlumberger’sSLB’s leading position in the oilfield services industry; because competition for our executive talent in the oil and gas industry, is exceptionally fierce; and because our executives are very highly sought after, both by our direct oilfield services competitors and by other leading oil and gas, advanced extractive, technology-driven manufacturing, and engineering-focused companies.companies, including companies focused on the new energy economy.
In approving this target range and when setting compensation for 2021,2022, the Committee considered that many current and former senior executives of leading companies in various industries have previously served in senior management at Schlumberger.SLB. Former members of senior SchlumbergerSLB management have either been, or are, senior executives at the following competitors, customers, and other technology- and engineering-focused companies:companies listed in the table below.
Baker Hughes* | TechnipFMC* | Weatherford | BAE Systems* | |||
(past Chairman and CEO, current CHRO and CLO, and other senior executives) | (current Chairman, CEO and CTO, and past Chairman, CEO and CHRO) | (past acting CEO and CFO, and other senior executives) | (current CEO, CFO and CHRO) | |||
Engie | CGG | BG Group | ||||
(current CEO) | (current CEO) | (current CEO and CFO) | (past Chairman and COO) | |||
ConocoPhillips* | YPF | Kuwait Airlines | Technip Energies | |||
(past CTO) | (past CEO) | (current CEO) | (current | |||
NESR | ||||||
( | (current CEO, CFO and COO) | (current | (current | |||
Expro | Nabors | Noble Corporation | NexTier Oilfield Solutions | |||
(current CEO, and past CEO and CFO) | (current CFO and other senior executives) | (current CLO) | (current CEO, CFO, COO and other senior executives) | |||
Flowserve | Borr Drilling | Archer | ||||
(past | (current CEO) | (current CEO and past CFO) | (current | |||
Seadrill | Jacobs | |||||
(past COO) | (current senior executive) |
CEO = Chief Executive Officer | CTO = Chief Technology Officer | ||||
CFO = Chief Financial Officer
|
CLO = Chief Legal Officer / General Counsel
| * | Included in | ||
COO = Chief Operating / Commercial Officer | CHRO = Chief Human Resources Officer |
2023 Proxy Statement | 45 |
Our Compensation Committee considers formal executive compensation survey data prepared by Pay Governance when it reviews and determines executive compensation, and when considering changes to our executive compensation program. The Committee considers data for the companies comprising our two “mainmain executive compensation peer groups”: groups—our oilcore industry peer group and our general industry peer group. The Committee believes these peer groups together provide the robust market data necessary to assess the current and future talent markets available to our executive officers, both in the oil and gas sector and in other global advanced extractive, technology-driven manufacturing, and industrial engineering-focused sectors. General industry peer group comparisons are particularly relevant for non-operations positions, where skills and experience may be easily transferable to other industries. In addition, the evolving energy industry environment creates challenges in maintaining a robust peer group comprising solely oilfield services and upstream companies, given decreases in individual company scope, as well as bankruptcies and consolidations in recent cycles.
The Committee annually reviews the specific selection criteria for our main executive compensation peer groups, such as competition for business or executive talent, revenue, market capitalization, and scope
of international operations. Pay Governance annually recommends for the Committee’s review the addition or removal of companies from these peer groups, based on the Committee’s selection criteria. As a general matter, the Committee selects suitable comparator companies such that the companies in these peer groups, at the median, approximate Schlumberger’sSLB’s estimated revenue in the then-current year and its then-current market capitalization. The Committee modifies its peer group criteria as appropriate while seeking a satisfactory degree of stability, to provide a consistent basis for comparison.
In July 2020,2021, our Compensation Committee directed Pay Governance to re-assessreviewed and approved the companies comprisinglisted below to comprise our two main executive compensation peer groups, in light of Schlumberger’s evolving business strategy and 2020 corporate reorganization. As a result of this assessment, the Committee reviewed and approved changes to these peer groups that it believes more appropriately reflect our strategy and address current and future executive talent markets. In selecting the companieseffective for inclusion in our main2022 executive compensation peer groups, the Committee focused on companies in countries with robust pay disclosure.decisions.
The companies comprising the oil industry peer group and the general industry peer group effective for 2021 compensation decisions are set forth below.
Our Compensation Committee made no changes to this peer group for 2022 compensation decisions, as compared to 2021. The Committee identified
| Baker Hughes BHP Group ConocoPhillips EOG Resources Halliburton Imperial Oil NOV Occidental Petroleum Suncor Energy TechnipFMC |
General Industry Peer Group | ||
In July |
|
| 3M Company ABB Air Products and Chemicals* Anglo American BAE Systems Carrier Global* Caterpillar Compagnie de Saint-Gobain Corning* Deere & Company
| Emerson Electric Freeport-McMoRan | General Dynamics Honeywell
Johnson Controls International Koninklijke Philips
LyondellBasell Industries Rio Tinto Rolls-Royce Holdings Schneider Electric
|
| 46 | 2023 Proxy Statement |
Historically, ourOur currently serving NEOs do not have not had ongoing employment, severance or severancechange-in-control agreements during their service with us as executive officers,SLB, and they serve at the will of the Board. This enables the CompanySLB to terminate their employment using judgment as to the necessity or terms of any severance arrangement and based on specific circumstances at the time they cease being executive officers. Our NEOs do not have change in control agreements, and we do not enter into employment, severance or change-in-control agreements with newly hired executive officers. For details regarding our agreementsagreement with outgoing NEOs,our former EVP New Energy, see “—Elements of 20212022 Total Direct Compensation—AgreementsOther Benefits—Agreement with Outgoing NEOs”Senior Strategic Advisor” on page 48.44.
Our Board and Compensation Committee strongly believe in linking executive long-term rewards to stockholdershareholder value. Our executive stock ownership guidelines require our executives to hold a minimum dollar value of Schlumberger commonSLB shares as set forth below:based on the table below.
Title | Stock Ownership Multiple |
Chief Executive Officer | 6x base salary |
Executive Vice Presidents | 3x base salary |
Executive officers (non-EVP) | 2x base salary |
1x base salary |
All executives subject to the guidelines must retain 50% of the net shares they acquire upon the exercise of stock options and after the vesting of PSUs and RSUs, after payment of applicable taxes, until they achieve the required ownership level.
TheUnder the guidelines, provide thatour executives have five years to satisfy the ownership requirements. After the five-year period, executives who have not met their minimum stock ownership requirement must retain 100% of the net shares they acquire upon stock option exercises and any PSUvesting of PSUs and RSU vestingRSUs until they achieve their required ownership level. Stock ownership for the purpose of these guidelines does not include shares underlying vested or unvested stock options, unvested RSUs or unvested PSUs.
As of January 31, 2022,2023, all of our NEOs were in compliance with our stock ownership guidelines.
Our executive officers and directors are prohibited from using any strategies or products (such as derivative securities or short-selling techniques) to hedge, directly or indirectly, against potential changes in the value of SLB shares. In addition, our executive officers and directors, as well as certain other key employees, are prohibited from holding SLB securities in a margin account or pledging SLB securities as collateral for a loan. Our insider trading policy strongly discourages, but does not prohibit, other employees from engaging in speculative transactions, including hedging or other financial mechanisms, holding SLB securities in a margin account or pledging SLB securities.
On November 17, 2022, Mr. Biguet entered into a 10b5-1 trading plan with his broker, to sell 75,000 shares of SLB common stock over a 12-month period beginning on March 20, 2023. The trading plan also contemplates the exercise (and subsequent sales) of up to 53,000 outstanding stock options.
Our Board has adopted a clawback policy to recoup performance-based incentive compensation, whether paid in the form of equity or cash, in the event of specified restatements of financial results. Under this policy, if financial results are restated due to fraud or other intentional misconduct, our Compensation Committee will review any performance-based or incentive compensation paid to executive officers who are found to be personally responsible for the fraud or other intentional misconduct that caused, in whole or in part, the need for the restatement. Based on that review, the Committee will take any actions it deems appropriate or necessary, including recoupment of any amounts paid in excess of the amounts that would have been paid based on the restated financial results. In addition, our PSU awards and any shares of stock issued upon the vesting of PSU awards are subject to recoupment under the terms of those awards.
Our executive officers and directors are prohibited from using any strategies or products (such as derivative securities or short-selling techniques) to hedge, directly or indirectly, against potential changes in the value of Schlumberger common stock. In addition, our executive officers and directors, as well as certain other key employees, are prohibited from holding Schlumberger securities in a margin account or pledging Schlumberger securities as collateral for a loan. Our insider trading policy strongly discourages, but does not prohibit, other employees from engaging in speculative transactions, including hedging or other financial mechanisms, holding Schlumberger securities in a margin account or pledging Schlumberger securities.
47 |
Our Compensation Committee reviews the elements of our NEOs’ total direct compensation throughout the year, to evaluate whether each element remains competitive with the companies in our two main executive compensation peer groups. In making compensation decisions, the Committee relies on its own judgment after reviewing external market data, and also considers the following factors:
• | the executive’s scope of responsibilities, as well as leadership, management and technical expertise, growth potential, and position in our reporting | |
• | overall Company and individual | |
• | retention | |
• | the recommendations of our CEO (except with respect to his own compensation) | |
• | internal pay equity. |
Each January, the Committee evaluates all elements of executive officer compensation, after reviewing the prior year’s results and the achievement of Company financial objectives and each officer’s strategic personal objectives. The purpose of this annual evaluation is to determine whether any changes in an officer’s compensation may be appropriate. The CEO does not participate in the Committee’s deliberations regarding his own compensation. At the Committee’s request, the CEO reviews with the Committee the performance of the other executive officers, but no other NEO has any input in executive compensation decisions. Our Compensation Committee gives substantial weight to the CEO’s evaluations and recommendations because he is particularly able to assess the other executive officers’ performance and contributions to Schlumberger.SLB. Our Vice President of Human ResourcesChief People Officer assists the CEO in developing the other executives’ performance reviews and reviewing external market data to determine the CEO’s executive compensation recommendations.
The following table below summarizes the approximate timing of significant annual executive compensation events:events.
Establish Company financial objectives and CEO strategic personal objectives | January of each year with respect to the current year | |
Review and approve the peer group companies used for compensation benchmarking | July of each year for compensation in the following year | |
Pay Governance provides analysis for our Compensation Committee to evaluate year-to-date compensation decisions in light of year-to-date comparative data, and to prepare for the annual executive officer compensation review in January | October of each year for compensation in the following year | |
Evaluate Company and executive performance (achievement of objectives established in previous year) and recommend annual cash incentive payout based on those results | Results approved in January of each year for annual cash incentive compensation with respect to the prior year. The annual cash incentive earned for the prior year is paid in February of the current year | |
Review and recommend executive base salaries and determine equity-based grants | January of each year for base salaries for that year and for equity-based grants |
Our Compensation Committee is responsible for granting long-term equity-based compensation under our omnibus stock incentive plans. The Committee approves a preliminary budget for equity-based grants for the following year at each October meeting. Awards for the CEO are granted by the Committee following approval by the independent members of the Board. Awards for executive officers other than the CEO are granted by the Committee and discussed with the Board. Management determines the allocation of equity-based grants for other groups within the Company and individual recommendations are made by the heads of the groups and approved by the CEO. In addition to considering the value of each equity-based award, management and the Committee also consider, as an additional factor in approving long-term equity awards, the overall potential stockholdershareholder dilution impact and “burnburn rate,” which is the rate at which awards are granted as a percentage of commonSLB shares outstanding.
The regular Board and Compensation Committee meeting schedule is set at least a year in advance, with meetings held quarterly in mid-January, mid-April, mid-July, and mid-October. Annual grants of equity-based awards to our NEOs and other executives, as well as to other eligible employees, are made at the Committee’s January meeting. Additionally, specific grants may be made at other Committee meetings to recognize an employee’s promotion, change in responsibility or specific achievement, or to achieve other key compensation objectives, such as retention. Generally, the Committee sets the grant date for equity awards as the Committee meeting date, which is usually two days in advance of the Company’s announcement of earnings. The Company does not time the release of material non-public information for the purpose of affecting the values of equity grants. At the time equity grant decisions are made, our Compensation Committee is aware of the earnings results, but it does not adjust the size or the mix of grants to reflect possible market reaction.
In addition, PSUs and RSUs do not accrue or pay dividends or dividend equivalents prior to vesting.
2023 Proxy Statement |
Our Compensation Committee has retained Pay Governance as its independent consultant with respect to executive compensation matters, as well as non-employee director compensation matters. Pay Governance works with Schlumberger’s Human Resources departmentSLB’s Total Rewards team to compile annual compensation data for each executive officer, and to compare the compensation opportunities of our executive officers with those at comparable roles at companies in our main executive compensation peer groups. Pay Governance also annually prepares an analysis of competitive non-employee director compensation levels and market trends using the same two main peer groups as are used for the annual executive officer compensation review.
Pay Governance reports only to, and acts solely at the direction of, our Compensation Committee. The Committee has assessed the independence of Pay Governance pursuant to SEC rules and has concluded that its work did not raise any conflict of interest that would prevent Pay Governance from independently representing our Compensation Committee.
Section 162(m) of the Internal Revenue Code limits the amount of compensation that may be deducted per covered employee, including each of our NEOs, to $1 million per taxable year. Thus, it is expected that compensation deductions for any covered individual will be subject to a $1 million annual deduction limitation. Although the deductibility of compensation is a consideration evaluated by our Compensation Committee, the Committee believes that the lost deduction on compensation for our NEOs is not material relative to the benefit of being able to attract and retain talented management. Accordingly, the Committee will continue to approve executive compensation that it believes is best for Schlumberger without regard to whether the compensation is fully deductible.
49 |
The following table sets forth information regarding the total compensation paid to our NEOs for fiscal years 2022, 2021 2020 and 2019.2020.
Name | Year | Salary ($) | (2) | Stock Awards ($) | (3) | Non-Equity Incentive Plan Compensation ($) | (4) | Change in Pension Value & Nonqualified Deferred Compensation Earnings ($) | (5) | All Other Compensation ($) | (6) | Total ($) | ||||||||||||||||
Olivier Le Peuch(1) | 2021 | 1,400,000 | 10,499,803 | 3,916,100 | 802,703 | 176,896 | 16,795,502 | |||||||||||||||||||||
Chief Executive Officer | 2020 | 1,383,846 | — | 2,251,200 | 1,844,619 | 170,419 | 5,650,084 | |||||||||||||||||||||
2019 | 1,147,500 | 14,515,858 | 2,360,250 | 981,058 | 112,504 | 19,117,170 | ||||||||||||||||||||||
Stephane Biguet | 2021 | 770,000 | 3,199,750 | 1,458,400 | 462,189 | 127,749 | 6,018,088 | |||||||||||||||||||||
Executive Vice President | 2020 | 755,193 | 2,499,742 | 837,000 | 767,587 | 119,081 | 4,978,603 | |||||||||||||||||||||
and Chief Financial Officer | ||||||||||||||||||||||||||||
Khaled Al Mogharbel | 2021 | 900,000 | 3,499,787 | 1,715,850 | (96,053 | ) | 244,569 | 6,264,153 | ||||||||||||||||||||
Executive Vice President, | 2020 | 889,615 | 3,719,674 | 1,045,800 | 297,898 | 262,956 | 6,215,943 | |||||||||||||||||||||
Geographies | 2019 | 895,000 | 5,770,142 | 1,423,050 | 327,754 | 211,550 | 8,627,496 | |||||||||||||||||||||
Hinda Gharbi | 2021 | 850,000 | 3,499,787 | 1,599,300 | 558,053 | 289,299 | 6,796,494 | |||||||||||||||||||||
Executive Vice President, | 2020 | 808,500 | 3,199,854 | 932,650 | 1,072,011 | 156,943 | 6,169,958 | |||||||||||||||||||||
Services and Equipment | 2019 | 764,167 | 4,729,651 | 1,176,800 | 623,734 | 186,226 | 7,480,578 | |||||||||||||||||||||
Ashok Belani | 2021 | 900,000 | 3,600,241 | 1,670,850 | 11,685 | 58,374 | 6,241,150 | |||||||||||||||||||||
Executive Vice President, | 2020 | 889,615 | 3,599,918 | 1,045,800 | 1,205,590 | 70,968 | 6,811,891 | |||||||||||||||||||||
Schlumberger New Energy | 2019 | 900,000 | 3,599,568 | 1,476,000 | 968,224 | 37,209 | 6,981,001 |
Name | Year | Salary ($) | Stock Awards ($) | (2) | Non-Equity Incentive Plan Compensation ($) | (3) | Change in Pension Value & Nonqualified Deferred Compensation Earnings ($) | (4) | All Other Compensation ($) | (5) | Total ($) | |||
Olivier Le Peuch Chief Executive Officer | 2022 | 1,550,000 | 11,999,949 | 1,929,750 | — | 234,058 | 15,713,757 | |||||||
2021 | 1,400,000 | 10,499,803 | 3,916,100 | 802,703 | 176,896 | 16,795,502 | ||||||||
2020 | 1,383,846 | — | 2,251,200 | 1,844,619 | 170,419 | 5,650,084 | ||||||||
Stephane Biguet Executive Vice President and Chief Financial Officer | 2022 | 850,000 | 3,499,993 | 690,650 | — | 139,327 | 5,179,970 | |||||||
2021 | 770,000 | 3,199,750 | 1,458,400 | 462,189 | 127,749 | 6,018,088 | ||||||||
2020 | 755,193 | 2,499,742 | 837,000 | 767,587 | 119,081 | 4,978,603 | ||||||||
Khaled Al Mogharbel Executive Vice President, Geographies | 2022 | 900,000 | 3,499,993 | 731,250 | — | 169,951 | 5,301,194 | |||||||
2021 | 900,000 | 3,499,787 | 1,715,850 | — | 244,569 | 6,360,206 | ||||||||
2020 | 889,615 | 3,719,674 | 1,045,800 | 297,898 | 262,956 | 6,215,943 | ||||||||
Abdellah Merad Executive Vice President, Core Services and Equipment | 2022 | 787,500 | 3,499,995 | 620,150 | — | 290,716 | 5,198,361 | |||||||
Dianne Ralston Chief Legal Officer and Secretary | 2022 | 750,022 | 3,199,948 | 581,250 | 361,028 | 94,160 | 4,986,408 | |||||||
Ashok Belani(1) Senior Strategic Advisor to the CEO; Former EVP, New Energy | 2022 | 900,000 | 3,600,030 | 174,950 | — | 98,544 | 4,773,524 | |||||||
2021 | 900,000 | 3,600,241 | 1,670,850 | 11,685 | 58,374 | 6,241,150 | ||||||||
2020 | 889,615 | 3,599,918 | 1,045,800 | 1,205,590 | 70,968 | 6,811,891 |
(1) | Mr. |
(2) | |
Includes the value of PSU and RSU awards. For | |
The value of each NEO’s | |
Annual cash incentive awards | |
The changes in pension value reported in this column represent the increase | |
The amount disclosed for Mr. Le Peuch consists | |
The amount disclosed for Mr. Biguet consists | |
The amount disclosed for Mr. Al Mogharbel consists | |
The amount disclosed for Ms. | |
The amount disclosed for Mr. Belani consists |
2023 Proxy Statement |
The following table provides additional information regarding cash incentive and PSU and RSU awards granted to our NEOs in 2021.2022.
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(2) | Estimated Possible Payouts Under Equity Incentive Plan Awards(3) | All Other Awards | (4) | Grant Date Awards | |||||||||||||||||||
Name | Award Type | (1) | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | (5) | |||||||||||||
O. Le Peuch | 741,300 | 1,942,500 | 4,202,100 | ||||||||||||||||||||
FCFM PSU | 1/20/21 | 55,145 | 110,290 | 275,725 | 2,624,902 | ||||||||||||||||||
ROCE PSU | 1/20/21 | 1 | 110,290 | 275,725 | 2,627,902 | ||||||||||||||||||
3-year RSU | 1/20/21 | 110,290 | 2,624,902 | ||||||||||||||||||||
TSR PSU | 2/3/21 | 24,110 | 96,440 | 192,880 | 2,625,097 | ||||||||||||||||||
S. Biguet | 271,810 | 712,250 | 1,627,010 | ||||||||||||||||||||
FCFM PSU | 1/20/21 | 16,805 | 33,610 | 84,025 | 799,918 | ||||||||||||||||||
ROCE PSU | 1/20/21 | 1 | 33,610 | 84,025 | 799,918 | ||||||||||||||||||
3-year RSU | 1/20/21 | 33,610 | 799,918 | ||||||||||||||||||||
TSR PSU | 2/3/21 | 7,348 | 29,390 | 58,780 | 799,996 | ||||||||||||||||||
K. Al Mogharbel | 317,700 | 832,500 | 1,800,900 | ||||||||||||||||||||
FCFM PSU | 1/20/21 | 18,380 | 36,760 | 91,900 | 874,888 | ||||||||||||||||||
ROCE PSU | 1/20/21 | 1 | 36,760 | 91,900 | 874,888 | ||||||||||||||||||
3-year RSU | 1/20/21 | 36,760 | 874,888 | ||||||||||||||||||||
TSR PSU | 2/3/21 | 8,038 | 32,150 | 64,300 | 875,123 | ||||||||||||||||||
H. Gharbi | 300,050 | 786,250 | 1,700,850 | ||||||||||||||||||||
FCFM PSU | 1/20/21 | 18,380 | 36,760 | 91,900 | 874,888 | ||||||||||||||||||
ROCE PSU | 1/20/21 | 1 | 36,760 | 91,900 | 874,888 | ||||||||||||||||||
3-year RSU | 1/20/21 | 36,760 | 874,888 | ||||||||||||||||||||
TSR PSU | 2/3/21 | 8,038 | 32,150 | 64,300 | 875,123 | ||||||||||||||||||
A. Belani | 317,700 | 832,500 | 1,800,900 | ||||||||||||||||||||
FCFM PSU | 1/20/21 | 18,910 | 37,820 | 94,550 | 900,116 | ||||||||||||||||||
ROCE PSU | 1/20/21 | 1 | 37,820 | 94,550 | 900,116 | ||||||||||||||||||
3-year RSU | 1/20/21 | 37,820 | 900,116 | ||||||||||||||||||||
TSR PSU | 2/3/21 | 8,265 | 33,060 | 66,120 | 899,893 |
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(2) | Estimated Possible Payouts Under Equity Incentive Plan Awards(3) | All Other Stock | Grant Date Fair Value of Stock | ||||||||||||||||||||
Name | Award Type | (1) | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | Awards (#) | (4) | Awards ($) | (5) | ||||||||||
O. Le Peuch | 820,725 | 2,150,625 | 4,652,325 | ||||||||||||||||||||
FCFM PSU | 1/19/22 | 41,853 | 83,705 | 209,263 | 2,999,987 | ||||||||||||||||||
ROCE PSU | 1/19/22 | 1 | 83,705 | 209,263 | 2,999,987 | ||||||||||||||||||
TSR PSU | 1/19/22 | 18,699 | 74,794 | 149,588 | 2,999,987 | ||||||||||||||||||
3-year RSU | 1/19/22 | 83,705 | 2,999,987 | ||||||||||||||||||||
S. Biguet | 300,050 | 786,250 | 1,796,050 | ||||||||||||||||||||
FCFM PSU | 1/19/22 | 12,207 | 24,414 | 61,035 | 874,998 | ||||||||||||||||||
ROCE PSU | 1/19/22 | 1 | 24,414 | 61,035 | 874,998 | ||||||||||||||||||
TSR PSU | 1/19/22 | 5,454 | 21,815 | 43,630 | 875,000 | ||||||||||||||||||
3-year RSU | 1/19/22 | 24,414 | 874,998 | ||||||||||||||||||||
K. Al Mogharbel | 317,700 | 832,500 | 1,800,900 | ||||||||||||||||||||
FCFM PSU | 1/19/22 | 12,207 | 24,414 | 61,035 | 874,998 | ||||||||||||||||||
ROCE PSU | 1/19/22 | 1 | 24,414 | 61,035 | 874,998 | ||||||||||||||||||
TSR PSU | 1/19/22 | 5,454 | 21,815 | 43,630 | 875,000 | ||||||||||||||||||
3-year RSU | 1/19/22 | 24,414 | 874,998 | ||||||||||||||||||||
A. Merad | 277,988 | 728,438 | 1,575,788 | ||||||||||||||||||||
FCFM PSU | 1/19/22 | 11,161 | 22,321 | 55,803 | 799,985 | ||||||||||||||||||
ROCE PSU | 1/19/22 | 1 | 22,321 | 55,803 | 799,985 | ||||||||||||||||||
TSR PSU | 1/19/22 | 4,987 | 19,945 | 39,890 | 799,994 | ||||||||||||||||||
3-year RSU | 1/19/22 | 22,321 | 799,985 | ||||||||||||||||||||
FCFM PSU | 4/19/22 | 896 | 1,792 | 4,480 | 75,013 | ||||||||||||||||||
ROCE PSU | 4/19/22 | 1 | 1,792 | 4,480 | 75,013 | ||||||||||||||||||
TSR PSU | 4/19/22 | 505 | 2,020 | 4,040 | 75,003 | ||||||||||||||||||
3-year RSU | 4/19/22 | 1,799 | 75,018 | ||||||||||||||||||||
D. Ralston | 264,758 | 693,770 | 1,500,794 | ||||||||||||||||||||
FCFM PSU | 1/19/22 | 11,161 | 22,321 | 55,803 | 799,985 | ||||||||||||||||||
ROCE PSU | 1/19/22 | 1 | 22,321 | 55,803 | 799,985 | ||||||||||||||||||
TSR PSU | 1/19/22 | 4,987 | 19,945 | 39,890 | 799,994 | ||||||||||||||||||
3-year RSU | 1/19/22 | 22,321 | 799,985 | ||||||||||||||||||||
A. Belani | 317,700 | 832,500 | 1,800,900 | ||||||||||||||||||||
FCFM PSU | 1/19/22 | 12,556 | 25,112 | 62,780 | 900,014 | ||||||||||||||||||
ROCE PSU | 1/19/22 | 1 | 25,112 | 62,780 | 900,014 | ||||||||||||||||||
TSR PSU | 1/19/22 | 5,610 | 22,438 | 44,876 | 899,988 | ||||||||||||||||||
3-year RSU | 1/19/22 | 25,112 | 900,014 |
(1) | All equity grants were awarded under the 2017 |
(2) | These columns show the possible cash incentive payouts for each NEO for fiscal year |
(3) | Relates to PSUs, all of which are subject to a three-year performance period. See “Compensation Discussion and Analysis—Elements of |
2023 Proxy Statement | 51 |
(4) | Relates to RSUs, all of which will vest on |
(5) | With respect to PSU awards, this column reflects the grant date fair value for such PSUs at target. We calculated the grant date fair value of each PSU award by multiplying the number of PSUs at target by the applicable grant date fair values for the PSUs: (i) |
The following table provides additional information regarding outstanding and unexercised stock options and outstanding PSU and RSU awards for each of our NEOs as of December 31, 2021.2022.
Option Awards | Stock Awards | |||||||||||||||||||||||||||||
Name | Option/ PSU/RSU Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | (1) | Number of Securities Underlying Unexercised Options Unexercisable (#) | (1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | (2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | (2) | |||||||||||||||||
O. Le Peuch | 1/19/2012 | 30,000 | — | 72.110 | 1/19/2022 | |||||||||||||||||||||||||
4/18/2013 | 30,000 | — | 70.925 | 4/18/2023 | ||||||||||||||||||||||||||
4/16/2014 | 30,000 | — | 100.555 | 4/16/2024 | ||||||||||||||||||||||||||
4/16/2015 | 24,000 | — | 91.740 | 4/16/2025 | ||||||||||||||||||||||||||
4/20/2016 | 30,000 | — | 80.525 | 4/20/2026 | ||||||||||||||||||||||||||
1/19/2017 | 12,000 | 3,000 | 87.380 | 1/19/2027 | ||||||||||||||||||||||||||
1/16/2019 | 89,600 | (3) | 2,683,520 | |||||||||||||||||||||||||||
4/17/2019 | 19,540 | (3) | 585,223 | |||||||||||||||||||||||||||
8/1/2019 | 309,280 | (3) | 9,262,936 | |||||||||||||||||||||||||||
1/20/2021 | 110,290 | (4) | 3,303,186 | |||||||||||||||||||||||||||
1/20/2021 | 110,290 | (5) | 3,303,186 | |||||||||||||||||||||||||||
1/20/2021 | 110,290 | (6) | 3,303,186 | |||||||||||||||||||||||||||
2/3/2021 | 96,440 | (7) | 2,888,378 | |||||||||||||||||||||||||||
S. Biguet | 1/19/2012 | 15,000 | — | 72.110 | 1/19/2022 | |||||||||||||||||||||||||
4/18/2013 | 20,000 | — | 70.925 | 4/18/2023 | ||||||||||||||||||||||||||
10/17/2013 | 20,000 | — | 91.280 | 10/17/2023 | ||||||||||||||||||||||||||
1/16/2014 | 13,000 | — | 88.765 | 1/16/2024 | ||||||||||||||||||||||||||
1/15/2015 | 18,000 | — | 77.795 | 1/15/2025 | ||||||||||||||||||||||||||
1/21/2016 | 28,000 | — | 61.920 | 1/21/2026 | ||||||||||||||||||||||||||
1/16/2019 | 42,000 | (3) | 1,257,900 | |||||||||||||||||||||||||||
1/15/2020 | 75,980 | (8) | 2,275,601 | |||||||||||||||||||||||||||
1/20/2021 | 33,610 | (4) | 1,006,620 | |||||||||||||||||||||||||||
1/20/2021 | 33,610 | (5) | 1,006,620 | |||||||||||||||||||||||||||
1/20/2021 | 33,610 | (6) | 1,006,620 | |||||||||||||||||||||||||||
2/3/2021 | 29,390 | (7) | 880,231 | |||||||||||||||||||||||||||
K. Al Mogharbel | 1/19/2012 | 15,000 | — | 72.110 | 1/19/2022 | |||||||||||||||||||||||||
4/18/2013 | 20,000 | — | 70.925 | 4/18/2023 | ||||||||||||||||||||||||||
7/18/2013 | 50,000 | — | 78.305 | 7/18/2023 | ||||||||||||||||||||||||||
1/16/2014 | 53,000 | — | 88.765 | 1/16/2024 | ||||||||||||||||||||||||||
1/15/2015 | 71,000 | — | 77.795 | 1/15/2025 | ||||||||||||||||||||||||||
1/21/2016 | 114,000 | — | 61.920 | 1/21/2026 | ||||||||||||||||||||||||||
1/16/2019 | 89,600 | (3) | 2,683,520 | |||||||||||||||||||||||||||
4/17/2019 | 12,700 | (3) | 380,365 | |||||||||||||||||||||||||||
4/17/2019 | 48,840 | (9) | 1,462,758 | |||||||||||||||||||||||||||
1/15/2020 | 113,060 | (8) | 3,386,147 | |||||||||||||||||||||||||||
1/20/2021 | 36,760 | (4) | 1,100,962 | |||||||||||||||||||||||||||
1/20/2021 | 36,760 | (5) | 1,100,962 | |||||||||||||||||||||||||||
1/20/2021 | 36,760 | (6) | 1,100,962 | |||||||||||||||||||||||||||
2/3/2021 | 32,150 | (7) | 962,893 |
Option Awards | Stock Awards | |||||||||||||||||||||||
Name | Option/ PSU/RSU Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | (1) | Number of Securities Underlying Unexercised Options Unexercisable (#) | (1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | (2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | (2) | |||||||||||
O. Le Peuch | 4/18/2013 | 30,000 | — | 70.925 | 4/18/2023 | |||||||||||||||||||
4/16/2014 | 30,000 | — | 100.555 | 4/16/2024 | ||||||||||||||||||||
4/16/2015 | 24,000 | — | 91.740 | 4/16/2025 | ||||||||||||||||||||
4/20/2016 | 30,000 | — | 80.525 | 4/20/2026 | ||||||||||||||||||||
1/19/2017 | 15,000 | — | 87.380 | 1/19/2027 | ||||||||||||||||||||
1/20/2021 | 220,580 | (3) | 11,792,207 | |||||||||||||||||||||
1/20/2021 | 110,290 | (4) | 5,896,103 | |||||||||||||||||||||
2/3/2021 | 96,440 | (5) | 5,155,682 | |||||||||||||||||||||
1/19/2022 | 242,204 | (6) | 12,948,226 | |||||||||||||||||||||
1/19/2022 | 83,705 | (7) | 4,474,869 | |||||||||||||||||||||
S. Biguet | 4/18/2013 | 20,000 | — | 70.925 | 4/18/2023 | |||||||||||||||||||
10/17/2013 | 20,000 | — | 91.280 | 10/17/2023 | ||||||||||||||||||||
1/16/2014 | 13,000 | — | 88.765 | 1/16/2024 | ||||||||||||||||||||
1/15/2015 | 18,000 | — | 77.795 | 1/15/2025 | ||||||||||||||||||||
1/21/2016 | 28,000 | — | 61.920 | 1/21/2026 | ||||||||||||||||||||
1/15/2020 | 75,980 | (8) | 4,061,891 | |||||||||||||||||||||
1/20/2021 | 67,220 | (3) | 3,593,581 | |||||||||||||||||||||
1/20/2021 | 33,610 | (4) | 1,796,791 | |||||||||||||||||||||
2/3/2021 | 29,390 | (5) | 1,571,189 | |||||||||||||||||||||
1/19/2022 | 70,643 | (6) | 3,776,575 | |||||||||||||||||||||
1/19/2022 | 24,414 | (7) | 1,305,172 | |||||||||||||||||||||
K. Al Mogharbel | 4/18/2013 | 20,000 | — | 70.925 | 4/18/2023 | |||||||||||||||||||
7/18/2013 | 50,000 | — | 78.305 | 7/18/2023 | ||||||||||||||||||||
1/16/2014 | 53,000 | — | 88.765 | 1/16/2024 | ||||||||||||||||||||
1/15/2015 | 71,000 | — | 77.795 | 1/15/2025 | ||||||||||||||||||||
1/21/2016 | 114,000 | — | 61.920 | 1/21/2026 | ||||||||||||||||||||
1/15/2020 | 113,060 | (8) | 6,044,188 | |||||||||||||||||||||
1/20/2021 | 73,520 | (3) | 3,930,379 | |||||||||||||||||||||
1/20/2021 | 36,760 | (4) | 1,965,190 | |||||||||||||||||||||
2/3/2021 | 32,150 | (5) | 1,718,739 | |||||||||||||||||||||
1/19/2022 | 70,643 | (6) | 3,776,575 | |||||||||||||||||||||
1/19/2022 | 24,414 | (7) | 1,305,172 |
2023 Proxy Statement |
Option Awards | Stock Awards | |||||||||||||||||||||||||||||
Name | Option/ PSU/RSU Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | (1) | Number of Securities Underlying Unexercised Options Unexercisable (#) | (1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | (2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | (2) | |||||||||||||||||
H. Gharbi | 1/19/2012 | 20,000 | — | 72.110 | 1/19/2022 | |||||||||||||||||||||||||
4/18/2013 | 20,000 | — | 70.925 | 4/18/2023 | ||||||||||||||||||||||||||
4/16/2014 | 24,000 | — | 100.555 | 4/16/2024 | ||||||||||||||||||||||||||
4/16/2015 | 24,000 | — | 91.740 | 4/16/2025 | ||||||||||||||||||||||||||
4/20/2016 | 30,000 | — | 80.525 | 4/20/2026 | ||||||||||||||||||||||||||
1/19/2017 | 1,500 | (10) | 44,925 | |||||||||||||||||||||||||||
1/16/2019 | 89,600 | (3) | 2,683,520 | |||||||||||||||||||||||||||
4/17/2019 | 36,630 | (9) | 1,097,069 | |||||||||||||||||||||||||||
1/15/2020 | 97,260 | (8) | 2,912,937 | |||||||||||||||||||||||||||
1/20/2021 | 36,760 | (4) | 1,100,962 | |||||||||||||||||||||||||||
1/20/2021 | 36,760 | (5) | 1,100,962 | |||||||||||||||||||||||||||
1/20/2021 | 36,760 | (6) | 1,100,962 | |||||||||||||||||||||||||||
2/3/2021 | 32,150 | (7) | 962,893 | |||||||||||||||||||||||||||
A. Belani | 1/19/2012 | 127,000 | — | 72.110 | 1/19/2022 | |||||||||||||||||||||||||
1/17/2013 | 72,000 | — | 73.250 | 1/17/2023 | ||||||||||||||||||||||||||
1/16/2014 | 60,000 | — | 88.765 | 1/16/2024 | ||||||||||||||||||||||||||
1/15/2015 | 80,000 | — | 77.795 | 1/15/2025 | ||||||||||||||||||||||||||
1/21/2016 | 128,000 | — | 61.920 | 1/21/2026 | ||||||||||||||||||||||||||
1/16/2019 | 100,800 | (3) | 3,018,960 | |||||||||||||||||||||||||||
1/15/2020 | 109,420 | (8) | 3,277,129 | |||||||||||||||||||||||||||
1/20/2021 | 37,820 | (4) | 1,132,709 | |||||||||||||||||||||||||||
1/20/2021 | 37,820 | (5) | 1,132,709 | |||||||||||||||||||||||||||
1/20/2021 | 37,820 | (6) | 1,132,709 | |||||||||||||||||||||||||||
2/3/2021 | 33,060 | (7) | 990,147 |
Option Awards | Stock Awards | |||||||||||||||||||||||
Name | Option/ PSU/RSU Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | (1) | Number of Securities Underlying Unexercised Options Unexercisable (#) | (1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | (2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | (2) | |||||||||||
A. Merad | 4/18/2013 | 4,000 | — | 70.925 | 4/18/2023 | |||||||||||||||||||
4/16/2014 | 20,000 | — | 100.555 | 4/16/2024 | ||||||||||||||||||||
4/16/2015 | 20,000 | — | 91.740 | 4/16/2025 | ||||||||||||||||||||
4/20/2016 | 20,000 | — | 80.525 | 4/20/2026 | ||||||||||||||||||||
1/15/2020 | 97,260 | (8) | 5,199,520 | |||||||||||||||||||||
1/20/2021 | 67,220 | (3) | 3,593,581 | |||||||||||||||||||||
1/20/2021 | 33,610 | (4) | 1,796,791 | |||||||||||||||||||||
2/3/2021 | 29,390 | (5) | 1,571,189 | |||||||||||||||||||||
1/19/2022 | 64,587 | (6) | 3,452,821 | |||||||||||||||||||||
1/19/2022 | 22,321 | (7) | 1,193,281 | |||||||||||||||||||||
4/19/2022 | 5,604 | (6) | 299,590 | |||||||||||||||||||||
4/19/2022 | 1,799 | (9) | 96,175 | |||||||||||||||||||||
D. Ralston | 12/1/2020 | 44,760 | (8) | 2,392,870 | ||||||||||||||||||||
12/1/2020 | 34,604 | (10) | 1,849,930 | |||||||||||||||||||||
1/20/2021 | 67,220 | (3) | 3,593,581 | |||||||||||||||||||||
1/20/2021 | 33,610 | (4) | 1,796,791 | |||||||||||||||||||||
2/3/2021 | 29,390 | (5) | 1,571,189 | |||||||||||||||||||||
1/19/2022 | 64,587 | (6) | 3,452,821 | |||||||||||||||||||||
1/19/2022 | 22,321 | (7) | 1,193,281 | |||||||||||||||||||||
A. Belani | 1/17/2013 | 72,000 | — | 73.250 | 1/17/2023 | |||||||||||||||||||
1/16/2014 | 60,000 | — | 88.765 | 1/16/2024 | ||||||||||||||||||||
1/15/2015 | 80,000 | — | 77.795 | 1/15/2025 | ||||||||||||||||||||
1/21/2016 | 128,000 | — | 61.920 | 1/21/2026 | ||||||||||||||||||||
1/15/2020 | 109,420 | (8) | 5,849,593 | |||||||||||||||||||||
1/20/2021 | 75,640 | (3) | 4,043,714 | |||||||||||||||||||||
1/20/2021 | 37,820 | (4) | 2,021,857 | |||||||||||||||||||||
2/3/2021 | 33,060 | (5) | 1,767,388 | |||||||||||||||||||||
1/19/2022 | 72,662 | (6) | 3,884,511 | |||||||||||||||||||||
1/19/2022 | 25,112 | (7) | 1,342,488 |
(1) | |
(2) | Market value |
(3) | Reflects the target number of |
Reflects the number of three-year RSUs that were issued in January 2021 and that will vest on January 20, 2024, subject to continued employment with | |
Reflects the target number of TSR PSUs that were issued in February 2021 and that will vest, if at all, in January 2024, subject to the achievement of performance conditions. | |
(6) | Reflects the target number of FCF Margin PSUs, ROCE PSUs, and TSR PSUs that were issued in January 2022 and, solely to Mr. Merad, April 2022, and that will vest, if at all, in January 2025, subject to the achievement of performance conditions. |
(7) | Reflects the number of three-year RSUs that were issued in January 2022 and that will vest on January 19, 2025, subject to continued employment with SLB through that date. |
(8) | Reflects the target number of free cash flow conversion PSUs and ROCE PSUs that were issued in January 2020 and, solely to Ms. Ralston, December 2020, and that |
(9) | Reflects the number of three-year RSUs that were issued to Mr. Merad in April |
(10) | In |
53 |
The following table provides additional information regarding stock options that were exercised and PSU and RSU awards that vested during 20212022 for our NEOs.
Option Awards | Stock Awards | |||||||
Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | ||||
O. Le Peuch | — | — | 30,464 | 748,944 | ||||
S. Biguet | — | — | 14,280 | 351,066 | ||||
K. Al Mogharbel | — | — | 30,464 | 748,944 | ||||
H. Gharbi | — | — | 31,964 | 787,209 | ||||
A. Belani | — | — | 34,272 | 842,561 |
Option Awards | Stock Awards | ||||||||
Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | |||||
O. Le Peuch | — | — | 903,787 | (1) | 33,181,010 | ||||
S. Biguet | — | — | 90,720 | 3,330,631 | |||||
K. Al Mogharbel | — | — | 269,808 | 10,203,307 | |||||
A. Merad | — | — | 193,536 | 7,105,347 | |||||
D. Ralston | — | — | 34,603 | 1,802,816 | |||||
A. Belani | — | — | 217,728 | 7,993,515 |
(1) | Reflects shares acquired upon vesting in 2022 with respect to three PSU awards made to Mr. Le Peuch in January 2019, April 2019 and August 2019. In connection with Mr. Le Peuch’s promotion to CEO in August 2019, he received a PSU award with a target value of $10.5 million, which served as and was granted in lieu of any 2020 LTI award. Because Mr. Le Peuch did not receive any LTI award in 2020, he will not vest in any PSUs or RSUs in 2023. As a result, the Stock Awards columns of the “Option Exercises and Stock Vested in 2023” table in our 2024 proxy statement will reflect zero shares acquired on vesting and zero value received on vesting for Mr. Le Peuch. |
We maintain the following pension plans for our NEOs and other employees who began employment with the CompanySLB at times when new hires were eligible to participate. These plans provide for lifetime pensions upon retirement, based on years of service:
• | Schlumberger Technology Corporation Pension Plan | |
• | Schlumberger Technology Corporation Supplementary Benefit Plan | |
• | Schlumberger Limited Supplementary Benefit Plan | |
• | ||
Schlumberger International Staff Pension Plan |
The following table and the discussion below provide information regarding pension benefits payable to our NEOs.
Name | Plan Name | Number of Years of Credited Service (#) | (1) | Present Value of Accumulated Benefits ($) | (2) | Payments During Last Fiscal Year | ||||
O. Le Peuch | STC Pension Plan | 11.75 | 943,174 | — | ||||||
STC Supplementary Plan | 7.25 | 1,429,288 | — | |||||||
SLB Supplementary Plan | 3.00 | 2,799,428 | — | |||||||
International Staff Pension Plan | 6.50 | 2,749,888 | — | |||||||
S. Biguet | STC Pension Plan | 7.41 | 569,844 | — | ||||||
SLB Supplementary Plan | 5.00 | 1,650,096 | — | |||||||
International Staff Pension Plan | 3.70 | 250,113 | — | |||||||
K. Al Mogharbel | International Staff Pension Plan | 16.20 | 1,841,636 | — | ||||||
H. Gharbi | STC Pension Plan | 5.76 | 450,015 | — | ||||||
SLB Supplementary Plan | 2.50 | 1,231,438 | — | |||||||
International Staff Pension Plan | 10.30 | 1,846,298 | — | |||||||
A. Belani | STC Pension Plan | 19.33 | 1,455,742 | — | ||||||
STC Supplementary Plan | 2.58 | 130,062 | — | |||||||
SLB Supplementary Plan | 16.75 | 6,543,957 | — | |||||||
International Staff Pension Plan | 10.00 | 655,691 | — |
Name | Plan Name | Number of Years of Credited Service (#) | (1) | Present Value of Accumulated Benefits ($) | (2) | Payments During Last Fiscal Year | ||
O. Le Peuch | STC Pension Plan | 12.75 | 786,105 | — | ||||
STC Supplementary Plan | 7.25 | 1,069,300 | — | |||||
SL Supplementary Plan | 4.00 | 3,456,270 | — | |||||
International Staff Pension Plan | 6.50 | 2,014,993 | — | |||||
S. Biguet | STC Pension Plan | 8.41 | 494,481 | — | ||||
SL Supplementary Plan | 6.00 | 1,710,367 | — | |||||
International Staff Pension Plan | 3.70 | 181,607 | — | |||||
K. Al Mogharbel | International Staff Pension Plan | 16.20 | 1,273,524 | — | ||||
A. Merad | International Staff Pension Plan | 14.90 | 804,454 | — | ||||
D. Ralston | SL Supplementary Plan | 7.50 | 495,412 | — | ||||
A. Belani | STC Pension Plan | 20.33 | 1,192,840 | — | ||||
STC Supplementary Plan | 2.58 | 100,006 | — | |||||
SL Supplementary Plan | 17.75 | 5,577,768 | — | |||||
International Staff Pension Plan | 10.00 | 490,506 | — |
(1) | The “Number of Years of Credited Service” column reflects each NEO’s actual years of service as a participant in each plan. |
(2) | The present value of accumulated benefits is calculated using the Pri-2012 healthy retiree amount-weighted |
2023 Proxy Statement |
The STC Pension Plan and the SLB USAB Pension Plan areis a U.S. tax-qualified pension plans. Eligible employees may participate in either of these plans during the course of their careers with Schlumberger, in which case they become entitled to a pension from the applicable plan, based upon the benefits accrued during the years of service related to such plan. These plans are funded through cash contributions made by the CompanySLB based on actuarial valuations and regulatory requirements. Benefits under these plansthe STC Pension Plan are based on an employee’s admissible compensation (generally base salary and cash incentive) for each year in which an employee participates in the plan, and the employee’s length of service with Schlumberger.SLB.
Since 1989, the benefit earned under the STC Pension Plan has been 1.5% of admissible compensation for service prior to the employee’s completion of 15 years of active service and 2.0% of admissible compensation for service after completion of 15 years of active service. Under the SLB USAB Pension Plan, the benefit earned in 2009 is 3.2% of admissible compensation, and after 2009 the benefit earned has been equal to 3.5% of admissible compensation. Normal retirement under these plansthe plan is at age 65; however, early retirement with a reduced benefit is possible at age 55 or as early as age 50 with 20 years of service. Mr. Biguet and Ms. Gharbi areis eligible for early retirement with a reduced pension. Additionally, under the “rule of 85” applicable to the STC Pension Plan,, an employee or executive officer who terminates employment after age 55 and whose combined age and service is 85 or more, is eligible for retirement with an unreduced pension. Messrs. Le Peuch and Belani are eligible for retirement with an unreduced pension under the rule of 85. The benefits are usually paid as a lifetime annuity.
In 2004, we amended the STC Pension Plan to generally provide that employees hired on or after October 1, 2004 would not be eligible to participate. Newly hired employees are eligible to participate in an enhanced defined contribution plan, which provides a Company matching contribution depending on an employee’s 401(k) contribution, as well as a Company discretionary profit sharing contribution based on theour profitability of the Company in a given year.
The SLBSL Supplementary Plan and the STC Supplementary Plan each provide non-tax-qualified pension benefits. Each of these plans, which have substantially identical terms, provides an eligible employee with benefits equal to the benefits that the employee is unable to receive under the applicablea qualified pension plan due to the Internal Revenue Code limits on (1) annual compensation that can be taken into account under qualified plans and (2) annual benefits that can be provided under qualified plans.
The retirement eligibility rules under SLB’s nonqualified pension plans are the same as under the tax-qualified pension plans.STC Pension Plan. These benefits are subject to forfeiture if the employee leaves the CompanySLB before the age of 50 with five years of service, engages in certain dishonest acts or has violated a confidentiality arrangement involving the Company or its affiliates.with us. Reduced benefits are paid to an employee upon separation from service, provided the employee has attained the age of 55, or if earlier, age 50 with 20 years of service. Messrs. Le Peuch and Belani are eligible for retirement with an unreduced pension under the rule of 85, described above. Mr. Biguet and Ms. GharbiRalston are eligible for early retirement with a reduced pension. Payment is made as a joint and survivor annuity, if married; otherwise, payment is made as a life-only annuity. Payment to key employees is delayed six months following separation from service. These nonqualified plan benefits are payable in cash from the Company’sSLB’s general assets and are intended to qualify as “excess benefit plans” exempt from certain requirements of Title I of the Employee Retirement Income Security Act of 1974.
RecognizingWe maintain the need to maintain a high degree of mobilityInternational Staff Pension Plan for certain employees who work in many different countries over the course of the Company’s employeestheir careers, and who otherwise would be unable to accumulate any meaningful pension because they are required to work in many different countries, the Company maintains the International Staff Pension Plan for such employees. Allpension. Most of the NEOs have either been in the International Staff Pension Plan at some time during their career prior to becoming an executive officer or are in the plan because of their current assignment. This plan provides for a lifetime annuity upon retirement based on a specified number of years of service. The plan is funded through cash contributions made by the CompanySLB together with mandatory contributions by employees.
Prior to 2010, benefits under this plan were based on a participant’s admissible compensation (base salary, geographical or rotational coefficient, as applicable, and cash incentive) for each year in which the employee participated in the plan and the employee’s length of service. The benefit earned up to year-end 2009 is 2.4% of admissible compensation prior to completion of 15 years of service, and 3.2% of admissible compensation for each year of service after 15 years. Following the completion of 20 years of service, the benefit earned with respect to the first 15 years of service is increased to 3.2%. Benefits are payable upon normal retirement age, at or after age 55, or upon early retirement with a reduction, at or after age 50 with 20 years of service. With respect to pension rights accrued prior to 2010, Messrs. Le Peuch and Belani are eligible for normal retirement with no reduction, and Messrs. Biguet and Al Mogharbel and Ms. GharbiBiguet are eligible for early retirement with a reduced pension. Since January 1, 2010, the benefit earned has been equal to 3.5% of admissible compensation regardless of an employee’s years of service. Benefits earned on or after this date are payable upon normal retirement age, at or after age 60, or upon early retirement at or after age 55 with a reduced pension. With respect to pension rights accrued in 2010 or later, Messrs. Al Mogharbel, Biguet, and Al Mogharbel and Ms. GharbiMerad will become eligible for normal retirement upon reaching age 60 and early retirement upon reaching age 55.
55 |
The following table and the discussion below provide information regarding nonqualified deferred compensation payable to our NEOs.
Name | Plan Name | Executive Contributions in Last FY ($) | (1) | Company Contributions in Last FY ($) | (2) | Aggregate Earnings in Last FY ($) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last FYE ($) | (3) | ||||||
O. Le Peuch | SLB Supplementary Plan | — | — | 10,347 | — | 116,306 | |||||||||
International Staff Profit Sharing Plan | — | — | 184,658 | — | 1,697,145 | ||||||||||
SLB Restoration Savings Plan | 1,008,360 | 100,836 | 203,821 | — | 3,537,186 | ||||||||||
S. Biguet | SLB Supplementary Plan | — | — | 72 | — | 18,423 | |||||||||
International Staff Profit Sharing Plan | — | — | 54,121 | — | 497,414 | ||||||||||
SLB Restoration Savings Plan | 368,760 | 39,510 | 164,814 | — | 1,115,086 | ||||||||||
K. Al Mogharbel | SLB Supplementary Plan | — | — | 22,961 | — | 191,089 | |||||||||
International Staff Profit Sharing Plan | — | — | 92,607 | — | 851,124 | ||||||||||
SLB Restoration Savings Plan | 165,580 | 99,348 | 342,430 | — | 2,724,472 | ||||||||||
H. Gharbi | International Staff Profit Sharing Plan | — | — | 87,572 | — | 804,854 | |||||||||
SLB Restoration Savings Plan | 64,059 | 32,030 | 80,988 | — | 392,471 | ||||||||||
A. Belani | SLB Supplementary Plan | — | — | 53,725 | — | 838,459 | |||||||||
International Staff Profit Sharing Plan | — | — | 166,381 | — | 1,523,275 | ||||||||||
SLB Restoration Savings Plan | 99,348 | 49,674 | 63,376 | — | 3,565,424 |
Name | Plan Name | Executive Contributions in Last FY ($) | (1) | Company Contributions in Last FY ($) | (2) | Aggregate Earnings in Last FY ($) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last FYE ($) | (3) | |||||||||||||
O. Le Peuch | SL Supplementary Plan | — | — | (16,380) | — | 99,926 | ||||||||||||||||
International Staff Profit Sharing Plan | — | — | (261,045) | — | 1,436,099 | |||||||||||||||||
Restoration Savings Plan | 2,580,550 | 154,833 | (559,780) | — | 5,557,957 | |||||||||||||||||
S. Biguet | SL Supplementary Plan | — | — | (524) | — | 17,900 | ||||||||||||||||
International Staff Profit Sharing Plan | — | — | (73,044) | — | 424,370 | |||||||||||||||||
Restoration Savings Plan | 560,952 | 60,102 | (175,502) | — | 1,500,536 | |||||||||||||||||
K. Al Mogharbel | SL Supplementary Plan | — | — | (28,879) | — | 162,210 | ||||||||||||||||
International Staff Profit Sharing Plan | — | — | (130,915) | — | 720,209 | |||||||||||||||||
Restoration Savings Plan | 231,085 | 138,651 | (272,152) | — | 2,683,405 | |||||||||||||||||
A. Merad | SL Supplementary Plan | — | — | (528) | — | 2,965 | ||||||||||||||||
International Staff Profit Sharing Plan | — | — | (96,699) | — | 531,972 | |||||||||||||||||
Restoration Savings Plan | 111,941 | 111,941 | 29,968 | — | 643,578 | |||||||||||||||||
D. Ralston | Restoration Savings Plan | 187,492 | 56,248 | 21,880 | — | 281,625 | ||||||||||||||||
A. Belani | SL Supplementary Plan | — | — | (111,626) | — | 726,834 | ||||||||||||||||
International Staff Profit Sharing Plan | — | — | (197,662) | — | 1,325,613 | |||||||||||||||||
Restoration Savings Plan | 135,951 | 67,975 | (51,892) | — | 3,649,483 |
(1) | Represents an NEO’s elective contributions to the |
(2) | Represents |
(3) | Represents each NEO’s account balances for the |
The SLBSL Supplementary Plan provides eligible employees, including our NEOs, with certain non-tax-qualified defined contribution benefits, for eligible employees, including our NEOs. Schlumberger Technology Corporation, an indirect wholly owned subsidiary of Schlumberger Limited, maintains the STC Supplementary Plan with substantially identical terms.
The SLB Supplementary Plan and the STC Supplementary Plan provide an eligible employee with discretionary Company profit sharing contributions that are not permissible under the applicablea tax-qualified plan due to Internal Revenue Code limits on (1) annual compensation that can be taken into account under the qualified plan and (2) annual benefits that can be provided under the qualified plan. These nonqualified plan benefits are credited with earnings and losses based on employee investment elections. An employee forfeits rights under the nonqualified plans if the employee terminates employment before completing four years of service, engages in certain dishonest acts or has violated a confidentiality arrangement involving the Company or its affiliates.with us. These nonqualified plan benefits are paid in a lump-sum payment following the end of the year in which the employee terminates active service, or the employee can elect to receive payment in installments of five or ten years following the termination of service. If the employee dies before full payment of these benefits, the unpaid benefits are paid in a lump sum to the beneficiaries designated under the plan. Payment to key employees is delayed six months following separation from service.
SLB
SchlumbergerSLB maintains the SLB International Staff Profit Sharing Plan, which provides for an annual employer contribution based on admissible compensation (base salary, geographical or rotational coefficient, as applicable, and cash incentive). Amounts allocated to the participants’ accounts share in investment gains and/or losses of the trust fund and are generally distributed in a lump sum upon the satisfaction of certain conditions on termination of employment or, upon the employee’s election, may be converted to additional pension rights under the International Staff Pension Plan. Benefits earned under the SLB International Staff Profit-SharingProfit Sharing Plan will be forfeited upon a determination by the SLB International Staff Profit-SharingProfit Sharing Plan’s administrator that the employee’s separation from service was due to circumstances of fraud or misconduct detrimental to the Company, an affiliateus or any customer.
2023 Proxy Statement |
The SLB Restoration Savings Plan, a nonqualified deferred compensation plan, provides certain defined contribution benefits for our NEOs and other eligible employees. The SLB Restoration Savings Plan allows an eligible employee to defer compensation (and receive an associated employer match) that the employee cannot otherwise defer under the applicablea tax-qualified plan because of Internal Revenue Code limits on the amount of compensation that can be taken into account. Schlumberger Technology CorporationSTC maintains the STC Restoration Savings Plan with substantially identical terms.
An eligible employee may elect in advance to defer a percentage (from 1% to 50%) of admissible compensation (generally base salary and cash incentive) over the Internal Revenue Code annual compensation limits. The Company makesWe make matching contributions with respect to each employee’s deferrals. For employees who participate in a Schlumbergerany SLB tax-qualified pension plan, the amount of the matching contribution is equal toequals 50% of the first 6% deferred by the employee. For employees who do not participate in a Schlumbergerany SLB tax-qualified pension plan, the matching contribution is 100% of the first 6% deferred by the employee. The match is made each payroll period and is not contingent on profitability of the Company.SLB’s profitability. Employees’ accounts are credited with earnings based on their investment elections. If the employee is eligible for the SLBAll NEOs are 100% vested in their Restoration Savings and Profit Sharing Plan matching contributions and related earnings vest based on the employee’s years of service, as follows:earnings.
If the employee is eligible for the SLB Savings and Profit Sharing Plan for U.S. Taxpayers Employed Abroad, matching contributions and related earnings vest based on the employee’s years of service, as follows:
An employee’s account fully vests on death, the employee’s 60th birthday or plan termination. An employee’s vested account balance is paid in a single lump sum (subject to tax withholding) following the participant’s death, qualifying disability, retirement or other qualifying termination of employment or, subject to certain limitations, the employee can elect to receive payment in installments of five or ten years following the termination of employment. However, an employee forfeitsemployees forfeit all benefits under the plan if a determination is made that the employee hasthey have engaged in certain dishonest acts or violated a confidentiality arrangement involving Schlumberger or its affiliates.with us. Payment to key employees is delayed six months following separation from service.
Our NEOs generally receive the same benefits as our other employees. As is the case with our other compensation arrangements, any differences are generally due to local (country-specific) requirements. In line with this practice, our NEOs historicallydo not have not had ongoing employment or severance agreements during their service with us as executive officers. Nor do our NEOs have change in control agreements or “golden parachutes”. The Company’s executive officersOur NEOs serve at the will of the Board, which enables the CompanySLB to terminate their employment using judgment as to the necessity or terms of any severance arrangement and based on specific circumstances at the time they cease being executive officers. For details regarding our agreementsagreement with outgoing NEOs,Mr. Belani, see “Compensation Discussion and Analysis—Elements of 20212022 Total Direct Compensation—AgreementsOther Benefits—Agreement with Outgoing NEOs”Senior Strategic Advisor” on page 48.44.
All employees who receive equity awards, including our NEOs, are subject to the same terms and conditions in the event of a termination or change in control, except for certain stock options that were assumed in connection with our acquisition of Cameron International Corporation (Cameron), none of which are held by theour NEOs.
Under our 2017 Incentive Plan and the Company’s standard form ofIf a PSU andor RSU award agreements,holder’s employment with SLB terminates prior to an applicable vesting date, that holder’s PSUs and RSUs arewill be treated as follows upon the holder’s termination of employment with the Company prior to the applicable vesting date:follows:
• | If the holder’s employment terminates | |
• | If the holder’s employment terminates | |
• | If the holder’s employment terminates | |
• | If an individual terminates employment for another reason, no additional vesting is provided and the individual will automatically forfeit all outstanding PSUs and RSUs without any additional consideration |
For these purposes, “retirement,” “early retirement,” “special retirement” and “disability” have the meanings assigned to suchthose terms in the applicable PSU and RSU award agreements. The applicable date of “retirement,” “early retirement” or “special retirement” takes into consideration the completion of any active employment period, including employment pursuant to the Company’sour officer departure guidelines described on page 47 of this proxy statement.44.
2023 Proxy Statement | 57 |
This section summarizes the consequences for our NEOs and other employees under our omnibus incentive plans and standard form ofIf a stock option award agreement in the event an option holder’s employment terminates.with SLB terminates, that holder’s outstanding options will be treated as follows:
Reason for Termination of Employment | Vesting | Post-Employment Exercise Period | ||
Voluntary termination with SLB consent | No additional vesting | Exercisable (to the extent exercisable at termination) at any time within three months after termination. | ||
Termination by | None | Vested and unvested options forfeited immediately. | ||
Retirement | Continued vesting as if still employed with | Exercisable for 10 years from | ||
Special Retirement | No additional vesting | Exercisable (to the extent exercisable at termination) at any time during the 60-month period after termination due to retirement or during the remainder of the option period, whichever is shorter. | ||
Death or Disability | Full immediate vesting | Exercisable at any time during the 60-month period after termination due to death or disability or during the remainder of the option period, whichever is shorter. |
Notwithstanding the vesting and exercisability provisions described above, an option holder may forfeit the right to exercise stock options, and may have certain prior option exercises rescinded, if the option holder engages in “detrimental activity” within one year after termination of employment (or five years after termination of employment in the event of retirement or disability).
Under our omnibus incentive plans, in the event of a merger, consolidation, acquisition of property or stock, separation, spinoff, reorganization or liquidation (each a “Corporate Transaction”), our Board may, in its sole discretion, (1)(i) provide for the substitution of a new award (or other arrangement) for or assumption of any award, (2)(ii) provide for accelerated vesting of any awards, or (3)(iii) decide to cancel any awards and deliver to the holders cash in an amount that our Board determines in its sole discretion is equal to the fair market value of such awards on the date of such event. However, no current agreement with respect to our outstanding RSUs, PSUs and stock options currently provides for any definitive special treatment upon such a Corporate Transaction.
The following table sets forth the value of the unvested RSUs and PSUs (at target) and the intrinsic value of the unvested stock options held by each NEO as of December 31, 2021,2022, that would become vested upon the occurrence of a Corporate Transaction, assuming that the Board elects to accelerate the vesting of RSUs, PSUs and stock options as provided in the previous paragraph. Due to the various factors that could affect the nature and amount of any benefits provided upon these events, any amounts actually paid or distributed may be different. Factors that could affect these amounts include the time during the year of any such event, the price of SchlumbergerSLB common stock and SLB’s achievement by the Company of any relevant performance metric.
Upon Corporate Transaction | ||||||||
Name | Value of Unvested RSUs and PSUs (at Target) ($) | (1) | Intrinsic Value of Unvested Options ($) | (2) | ||||
O. Le Peuch | 40,267,088 | — | ||||||
S. Biguet | 16,105,199 | — | ||||||
K. Al Mogharbel | 18,740,243 | — | ||||||
17,202,947 | — | |||||||
D. Ralston | 15,850,462 | — | ||||||
A. Belani | 18,909,550 | — |
(1) | Calculated by multiplying the December 30, 2022 closing price of |
(2) | Reflects that the December 30, 2022 closing price of |
2023 Proxy Statement |
The Company’sOur pension plans and nonqualified deferred compensation plans include the same terms and conditions for all participating employees in the event of a termination or change in control. The SLB and STC Restoration Savings Plans providePlan provides for accelerated payment of vested account balances within 30 days following a change in control as defined under Internal Revenue Code section 409A. Other than the SLB and STC Restoration Savings Plans,Plan, none of our nonqualified plans provide for the accelerated payment of benefits upon a change in control. For more information on these plans, see the Pension Benefits table and accompanying discussion beginning on page 5854 above and the Nonqualified Deferred Compensation table and accompanying discussion beginning on page 6056 above.
The following table sets forth the amounts as of December 31, 20212022 of benefit payments that would be accelerated under the SLB Restoration Savings Plan upon a change in control.
Name | Amount ($) | ||
O. Le Peuch | 5,557,957 | ||
S. Biguet | 1,500,536 | ||
K. Al Mogharbel | 2,683,405 | ||
D. Ralston | 281,625 | ||
A. Belani | 3,649,483 |
Retiree Medical
Subject to satisfying certain age, service and contribution requirements, most U.S. employees, including NEOs in the United States, are eligible to participate in a retiree medical program. Generally, this program provides comprehensive medical, prescription drug and vision benefits for retirees and their dependents until attaining age 65, and then after reaching age 65 receive an65. The program also provides annual contributioncontributions to a health reimbursement arrangement that can be used to purchase medical coverage or Medicare supplemental coverage and pay other tax-deductible expenses.
The following table below sets forth the following information as of December 31, 20212022 for all equity compensation plans approved and not approved by our stockholders.shareholders.
Plan category | (a) Number of securities to be issued upon exercise of outstanding options, warrants and rights | (b) Weighted-average exercise price of such outstanding options, warrants and rights ($) | (1) | (c) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | |||
Equity compensation plans approved by security holders | 40,372,599 | 69.05 | 62,965,520 | (2) | |||
Equity compensation plans not approved by security holders(3) | 1,974,556 | 66.92 | — | ||||
TOTAL | 42,347,155 | 68.95 | 62,965,520 | (2) |
Plan category | (a) Number of securities to be issued upon exercise of outstanding options, warrants and rights | (b) Weighted- average exercise price of such outstanding options, warrants and rights ($) | (1) | (c) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | ||||||||
Equity compensation plans approved by security holders | 33,525,663 | 70.41 | 48,886,386 | (2) | ||||||||
Equity compensation plans not approved by security holders(3) | 1,575,266 | 68.28 | — | |||||||||
Total | 35,100,929 | 70.31 | 48,886,386 | (2) |
(1) | The weighted average price does not take into account shares issuable upon the vesting of outstanding PSUs or RSUs, which have no exercise price. |
(2) | Includes |
(3) | Consists solely of options that were assumed in connection with our 2016 acquisition of Cameron, |
Equity compensation plans approved by our stockholdersshareholders include the Directors Stock Plan, as amended and restated; the 2017 Incentive Plan; the 2013 SchlumbergerSLB Omnibus Stock Incentive Plan, as amended and restated; the 2010 SchlumbergerSLB Omnibus Stock Incentive Plan, as amended and restated (the “2010 Incentive Plan”); the French Sub Plan under the 2010, 2013 and 2017 SchlumbergerSLB Omnibus Stock Incentive Plans, as amended and restated; the SchlumbergerSLB Discounted Stock Purchase Plan, as amended and restated; the SchlumbergerSLB 2008 Stock Incentive Plan, as amended and restated (the “2008 Incentive Plan”); and the SchlumbergerSLB 2005 Stock Incentive Plan, as amended and restated (the “2005 Incentive Plan”). There are no securities issuable under the 2010 Incentive Plan, the 2008 Incentive Plan or the 2005 Incentive Plan, other than shares of our common stock issuable upon the exercise of stock options currently outstanding.
59 |
Based on the methodology described below, our CEO’s 20212022 total compensation was 254142 times that of our median employee.
For 2021,2022, we used the same median employee that we had identified as of October 2020. There have been no changes in our employee population or our compensation arrangements in 2021since October 2020 that we believe would result in a materialsignificant change in our pay ratio disclosure or our median employee. As in 2020 and 2021, our median employee was a full-time, salaried employee working in Nigeria as a technical sales professional. To calculate that employee’s total compensation, we first calculated all of the elements of the employee’s compensation for 2021,2022, and then converted this total compensation amount to U.S. dollars using a blended exchange rate representing the average exchange rate during 20212022 (i.ei.e. . 397422 Nigerian Naira to one U.S. dollar). The resulting 20212022 total compensation of our median employee was $66,138.$110,784. Our CEO’s total compensation for 20212022 was $16,795,502$15,713,757 (as reflected in the Summary Compensation Table).
Our pay ratio is affected by many factors, and may not be comparable to the pay ratios reported by other companies, even in the oilfield servicestechnology and energy services industries. For example, the following factors may affect the comparability of our pay ratio:
• | our large global workforce, which may have significantly lower wages than U.S.- or European-based wages; | |
• | varied methodologies for calculating total compensation for both the median employee and our CEO, which may include exclusions that | |
• | varied currency exchange rates. |
2023 Proxy Statement |
As discussed in the CD&A above, our Compensation Committee has implemented an executive compensation program designed to link a substantial portion of our NEOs’ realized compensation to the achievement of SLB’s financial, operational, and strategic objectives, and to align our executive pay with changes in the value of our shareholders’ investments. The following table sets forth additional compensation information for our NEOs, calculated in accordance with SEC regulations, for fiscal years 2022, 2021 and 2020.
Value of Initial Fixed $100 Investment Based on: | (Stated in millions) | ||||||||||||||||
Name | Summary Compensation Table Total for CEO ($) | (1) | Compensation Actually Paid to CEO ($) | (2) | Average Summary Compensation Table Total for Non-CEO NEOs ($) | (3) | Average Compensation Actually Paid to Non-CEO NEOs ($) | (2)(3) | Total Shareholder Return | Peer Group Total Shareholder Return | (4) | Net Income (Loss) ($) | Adjusted EBITDA ($) | (5) | |||
2022 | 15,713,757 | 39,478,899 | 5,087,891 | 17,341,223 | $142.09 | $146.82 | 3,492 | 6,462 | |||||||||
2021 | 16,795,502 | 32,392,156 | 6,353,971 | 13,116,171 | $78.43 | $82.83 | 1,928 | 4,925 | |||||||||
2020 | 5,650,084 | (10,610,514) | 6,081,217 | 2,190,708 | $56.19 | $63.45 | (10,486) | 4,313 |
(1) | The dollar amounts reported are the amounts of total compensation reported for our CEO, Mr. Le Peuch, in the Summary Compensation Table for fiscal years 2022, 2021 and 2020. Mr. Le Peuch served as CEO for each of the years presented. |
(2) | The dollar amounts reported represent the amount of “compensation actually paid”, as computed in accordance with SEC rules. The dollar amounts do not reflect the actual amounts of compensation paid to our CEO or other NEOs during the applicable year, but also include (i) the year-end value of equity awards granted during the reported year, (ii) the change in the value of equity awards that were unvested at the end of the prior year, measured through the date the awards vested or were forfeited, or through the end of the reported fiscal year, and (iii) certain pension-related costs. |
(3) | For 2022, reflects compensation information for our NEOs, other than our CEO, as described in the CD&A of this proxy statement. For 2021, reflects compensation information for Mr. Al Mogharbel, Mr. Belani, and Mr. Biguet, as well as Hinda Gharbi, SLB’s former EVP, Services and Equipment. For 2020, reflects compensation information for Mr. Al Mogharbel, Mr. Belani, and Mr. Biguet, as well as Ms. Gharbi and Simon Ayat, SLB’s former EVP and Chief Financial Officer. |
(4) | Reflects cumulative total shareholder return of the Philadelphia Oil Services Sector (OSX) index, as of December 31, 2022, weighted according to the constituent companies’ market capitalization at the beginning of each period for which a return is indicated. The OSX is the peer group used by SLB for purposes of Item 201(e) of Regulation S-K under the Exchange Act in SLB’s Annual Report on Form 10-K for the year ended December 31, 2022. |
(5) | Adjusted EBITDA represents income before taxes, excluding charges and credits, depreciation and amortization, interest expense, and interest income. For a reconciliation of net income attributable to SLB on a GAAP basis to adjusted EBITDA, see Appendix A. |
To calculate the amounts in the “Compensation Actually Paid to CEO” column in the table above, the following amounts were deducted from and added to (as applicable) our CEO’s “Total” compensation as reported in the Summary Compensation Table (SCT):
Year | Summary Compensation Table Total for CEO ($) | Reported Value of Equity Awards for CEO ($) | (1) | Equity Award Adjustments for CEO ($) | (2) | Reported Change in the Actuarial Present Value of Pension Benefits for CEO ($) | (3) | Pension Benefit Adjustments for CEO ($) | (4) | Compensation Actually Paid to CEO ($) | ||
2022 | 15,713,757 | (11,999,949) | 35,564,073 | — | 201,018 | 39,478,899 | ||||||
2021 | 16,795,502 | (10,499,803) | 26,690,503 | (802,703) | 208,657 | 32,392,156 | ||||||
2020 | 5,650,084 | — | (14,488,584) | (1,844,619) | 72,605 | (10,610,514) |
(1) | Represents the grant date fair value of the equity awards to our CEO, as reported in the “Stock Awards” column in the SCT for each applicable year. |
(2) | Represents the year-over-year change in the fair value of equity awards to our CEO, as itemized in the table below. No awards vested in the year they were granted. |
Fair Value of Equity Awards for CEO | 2022 ($) | 2021 ($) | 2020 ($) | ||||
As of year-end for awards granted during the year | 20,140,255 | 17,159,320 | — | ||||
Year-over-year increase (decrease) of unvested awards granted in prior years | 9,171,658 | 9,400,936 | (14,003,835) | ||||
Increase (decrease) from prior fiscal year–end for awards that vested during the year | 6,252,160 | 130,247 | (484,749) | ||||
Total Equity Award Adjustments | 35,564,073 | 26,690,503 | (14,488,584) |
(3) | Represents the change in the actuarial present value of our CEO’s accumulated benefit under all benefit and actuarial pension plans in which he participates, as reported in the “Change in Pension Value & Nonqualified Deferred Compensation Earnings” column in the SCT for each applicable year. |
(4) | Represents the actuarially determined service cost for services rendered under all benefit and actuarial pension plans in which our CEO participates during each applicable year. |
2023 Proxy Statement | 61 |
To calculate the amounts in the “Average Compensation Actually Paid to Non-CEO NEOs” column in the table above, the following amounts were deducted from and added to (as applicable) the average of the “Total” compensation of our non-CEO named executive officers for each applicable year, as reported in the SCT for that year:
Year | Average Summary Compensation Table Total for Non-CEO NEOs ($) | Average Reported Value of Equity Awards for Non-CEO NEOs ($) | (1) | Average Equity Award Adjustments for Non-CEO NEOs ($) | (2) | Average Reported Change in the Actuarial Present Value of Pension Benefits for Non- CEO NEOs ($) | (3) | Average Pension Benefit Adjustments for Non-CEO NEOs ($) | (4) | Average Compensation Actually Paid to Non-CEO NEOs ($) | ||
2022 | 5,087,891 | (3,459,992) | 15,684,764 | (72,206) | 100,764 | 17,341,223 | ||||||
2021 | 6,353,971 | (3,449,891) | 10,304,511 | (257,982) | 165,563 | 13,116,171 | ||||||
2020 | 6,081,217 | (3,403,834) | 297,042 | (889,632) | 105,915 | 2,190,708 |
(1) | Represents the average of the grant date fair value of the equity awards to our named executive officers (other than our CEO), as reported in the “Stock Awards” column in the SCT for each applicable year. |
(2) | Represents the average of the year-over-year change in the fair value of equity awards to our named executive officers (other than our CEO), as itemized in the table below. No awards vested in the year they were granted. |
Fair Value of Equity Awards for Non-CEO NEOs | 2022 ($) | 2021 ($) | 2020 ($) | |||
As of year-end for awards granted during the year | 5,797,937 | 5,637,984 | 4,258,414 | |||
Year-over-year increase (decrease) of unvested awards granted in prior years | 8,699,829 | 4,543,201 | (3,520,367) | |||
Increase (decrease) from prior fiscal year-end for awards that vested during the year | 1,186,999 | 123,326 | (441,004) | |||
Total Equity Award Adjustments | 15,684,764 | 10,304,511 | 297,042 |
(3) | Represents the average change in the actuarial present value of the accumulated benefits to our named executive officers (other than our CEO), under all benefit and actuarial pension plans in which they participate, as reported in the “Change in Pension Value & Nonqualified Deferred Compensation Earnings” column in the SCT for each applicable year. |
(4) | Represents the average of the actuarially determined service cost for services rendered under all benefit and actuarial pension plans in which our named executive officers (other than our CEO) participate during each applicable year. |
The following table identifies the five most important financial performance measures used by our Compensation Committee to link the “compensation actually paid” (CAP) to our CEO and other NEOs in 2022, calculated in accordance with SEC regulations, to company performance. The role of each of these performance measures on our NEOs’ compensation is discussed in the CD&A above.
Financial Performance Measures |
Adjusted EBITDA |
Free Cash Flow |
Free Cash Flow Margin |
Return on Capital Employed |
Total Shareholder Return |
The charts on the following page reflect that the CAP over the three-year period ended December 31, 2022 aligns to trends in SLB’s TSR, net income and adjusted EBITDA results over the same period. In addition, the chart titled “CAP vs. Total Shareholder Return (SLB and OSX)” reflects that SLB’s TSR over this three-year period aligns closely to OSX TSR over the same period. In 2020, the negative CAP for Mr. Le Peuch was primarily impacted by the fact that he did not receive an LTI award that year, as well as stock price depreciation. In 2021, CAP for our CEO and other NEOs was primarily impacted by SLB’s share price appreciation of 43%. For 2022, CAP for our CEO and other NEOs was primarily impacted by SLB’s share price appreciation of 70%, partially offset by performance of unvested PSUs.
62 | 2023 Proxy Statement |
CAP vs. Total Shareholder Return
(SLB and OSX)
CAP vs. Net Income
CAP vs. Adjusted EBITDA
2023 Proxy Statement | 63 |
Following completion of the audit procedures performed by PwC, we are asking you to approve the following financial statements that are included in our 20212022 Annual Report to Stockholders:Shareholders:
• | our consolidated balance sheet at December 31, | |
• | ||
our consolidated statement of income for the year ended December 31, | ||
• | ||
the declarations of dividends by our Board in |
StockholdersYou should refer to our 20212022 Annual Report to StockholdersShareholders in considering this agenda item.
The Board of Directors | |
2023 Proxy Statement |
PwC has been selected by theour Audit Committee as the independent registered public accounting firm to audit theSLB’s annual financial statements of the Company for the year ending December 31, 2022.2023. Although ratification is not required by our bylaws or otherwise, as a matter of good corporate governance, we are asking you to ratify, on an advisory basis, the appointment of PwC as our independent auditor for the year ending December 31, 2022.2023. If the appointment is not ratified, the Audit Committee will consider whether it is appropriate to select another independent registered public accounting firm.
A representative of PwC is expected to attend our 20222023 AGM, and will be available to respond to appropriate questions.
The Board of Directors | |
PwC has billed the Company and its subsidiariesSLB the fees set forth in the table below for:
• | the audit of | |
• | ||
the other services described below that were billed in |
Year Ended December 31, | ||||||||
(Stated in thousands) | 2021 | 2020 | ||||||
Audit Fees(1) | $ | 12,250 | $ | 12,969 | ||||
Audit-Related Fees(2) | 534 | 495 | ||||||
Tax Fees(3) | 1,560 | 2,199 | ||||||
All Other Fees(4) | — | 43 | ||||||
TOTAL | $ | 14,344 | $ | 15,706 |
Year Ended December 31, | ||||||||
(Stated in thousands) | 2022 | 2021 | ||||||
Audit Fees(1) | $ | 13,122 | $ | 12,250 | ||||
Audit-Related Fees(2) | 634 | 534 | ||||||
Tax Fees(3) | 2,993 | 1,560 | ||||||
All Other Fees(4) | 44 | — | ||||||
Total | $ | 16,793 | $ | 14,344 |
(1) | Includes fees for integrated and statutory audits. |
(2) | Consists of fees for employee benefit plan audits and other audit-related items. |
(3) | Consists of fees for tax compliance, tax planning and other tax services. |
(4) | Consists of fees for advisory services. |
The Audit Committee considers the provision of services by PwC not related to the audit of the Company’sSLB’s annual financial statements and reviews of the Company’sSLB’s interim financial statements when evaluating PwC’s independence.
The Audit Committee has a policy to pre-approve all services provided to the CompanySchlumberger Limited and its subsidiaries by Schlumberger’sSLB’s independent registered public accounting firm. The Committee has adopted a schedule for annual approval of the audit and related audit plan, as well as approval of other anticipated audit-related services; anticipated tax compliance, tax planning and tax advisory services; and other anticipated services. In addition, the Committee (or an authorized committee member acting under delegated authority of the committee) will consider any proposed services not approved as part of this annual process. For 20212022 and 2020,2021, audit and non-audit services were pre-approved by the Audit Committee.
StockholderShareholder Feedback
At our 20212022 AGM, the proposal to ratify the appointment of PwC as our independent auditor for 20212022 received the support of 95%92% of the votes cast. In selecting PwC as the Company’sSLB’s independent auditor for 2022,2023, the Audit Committee considered this substantial support of our stockholders,shareholders, as well as PwC’s substantial experience auditing the Company’sSLB’s complex global accounts and the regulatory requirement that the PwC lead engagement partner rotate every five years.
65 |
During 2021,2022, the Audit Committee periodically reviewed and discussed the Company’sSLB’s consolidated financial statements with Company management and PwC, the Company’sSLB’s independent registered public accounting firm, including matters raised by the independent registered public accounting firm pursuant to applicable Public Company Accounting Oversight Board (“(PCAOB”) requirements. The Audit Committee also discussed with Company management and PwC the evaluation of the Company’sSLB’s reporting and internal controls undertaken in connection with certifications made by the Company’sSLB’s Chief Executive Officer and Chief Financial Officer in the Company’sSLB’s periodic SEC filings pursuant to the Sarbanes-Oxley Act of 2002. The Audit Committee also reviewed and discussed such other matters as it deemed appropriate, including the Company’sSLB’s compliance with Section 404 and other relevant provisions of the Sarbanes-Oxley Act of 2002 and rules adopted or proposed to be adopted by the SEC and the NYSE. The Audit Committee also reviewed with PwC the matters required to be discussed by the independent registered public accounting firm with the Audit Committee under applicable requirements of the PCAOB and the SEC.
PwC provided the Audit Committee with the required PCAOB disclosures and letters concerning its independence with respect to the Company, and the Audit Committee discussed PwC’s independence with them.
Based on the foregoing reviews and discussions, the Audit Committee recommended that the Board include the audited consolidated financial statements in the Company’sSLB’s Annual Report on Form 10-K for the year ended December 31, 2021,2022, as filed with the SEC on January 26, 2022.25, 2023.
SUBMITTED BY THE AUDIT COMMITTEE OF THE SCHLUMBERGER BOARD OF DIRECTORSSubmitted by the Audit Committee of the SLB Board of Directors
Patrick de La Chevardière, Chair | Samuel Leupold | Tatiana Mitrova | Jeff Sheets |
2023 Proxy Statement |
This proxy statement is furnished in connection with the solicitation by the SchlumbergerSLB Board of Directors of proxies to be voted at Schlumberger’s 2022SLB’s 2023 AGM, which will be held at the Curaçao Marriott Beach Resort, John F Kennedy Boulevard, 3, Piscadera Bay, Willemstad, Curaçao, on Wednesday, April 6, 20225, 2023 beginning at 10:00 a.m., Curaçao time, and at any postponement(s) or adjournment(s) thereof.
To be admitted to the meeting, stockholdersshareholders of record and beneficial owners as of the close of business on February 9, 20228, 2023 must present a passport or other government-issued identification with a photograph and, for beneficial owners, proof of ownership as of February 9, 2022,8, 2023, such as the Notice of Internet Availability (defined below), and/or the top half of the proxy card or voting instruction card that was sent to you with this proxy statement.
In addition, depending on the level of COVID-19 protocols in effect at the time, your ability to attend the 20222023 AGM in person may be restricted or may require additional safeguards, which could include face coverings, proof of vaccination, proof of a negative COVID-19 test result within a specified number of days, and maintaining appropriate social distancing. Please review www.proxydocs.com/SLB for any updates prior to traveling.
The mailing date of thisThis proxy statement is first being made available to our shareholders on February 24, 202223, 2023. The Chairperson of the meeting will determine the procedures for conducting the meeting and will limit the meeting to those matters properly brought by or at the direction of our Board or properly presented by a stockholder.shareholder.
This year we are using the internet as the primary means of furnishing proxy materials to stockholders.shareholders. We are sending a Notice of Internet Availability of Proxy Materials (the “Notice of Internet Availability”) to our stockholdersshareholders with instructions on how to access the proxy materials online or request a printed copy of the materials. StockholdersShareholders may follow the instructions in the Notice of Internet Availability to elect to receive future proxy materials in print by mail or electronically by email. We encourage stockholdersshareholders to take advantage of the availability of the proxy materials online to help reduce the environmental impact of our AGMs. Our proxy materials are also available at https://investorcenter.slb.com,, as well as at www.proxydocs.com/SLB.
Each stockholdershareholder of record at the close of business on the record date, February 9, 20228, 2023, is entitled to one vote for each director nominee and one vote for each of the other proposals to be voted on with respect to each share registered in the stockholder’sshareholder’s name. A stockholdershareholder of record is a person or entity who held shares on the record date registered in the shareholder’s name on the records of Computershare Trust Company, N.A. (“(Computershare”), Schlumberger’sSLB’s stock transfer agent. On the record date, February 9, 2022,8, 2023, there were 1,413,133,9861,427,601,663 shares of SchlumbergerSLB common stock outstanding and entitled to vote. Persons who held shares on the record date through a broker, bank, or other nominee are referred to as beneficial owners.
Shares cannot be voted at the meeting unless the owner of record is present in person or is represented by proxy. SchlumbergerSLB is incorporated in Curaçao and, in accordance with Curaçao law, meetings of stockholdersshareholders are held in Curaçao. Because many stockholdersshareholders cannot personally attend the meeting, it is necessary that a large number be represented by proxy.
Holders of at least one-half of the outstanding shares entitled to vote at the meeting must be present in person or represented by proxy to constitute a quorum for the taking of any action at the meeting. Abstentions and proxies submitted on your behalf by brokers, banks, or other holders of record that do not indicate a vote because they do not have discretionary voting authority and have not received instructions from the beneficial owner of the shares as to how to vote on a proposal (so-called “broker non-votes”) will be considered as present for quorum purposes. If a quorum is not present at the meeting, the Board may call a second general meeting of stockholders,shareholders, at which the quorum requirement will not apply.
To be elected, director nominees must receive a majority of the votes cast, which means the number of votes cast “for” a director nominee must exceed the number of votes cast “against” that nominee. Approval of each of the other matters on the agenda also requires the affirmative vote of the majority of the votes cast.
2023 Proxy Statement | 67 |
If your SchlumbergerSLB shares are held for you in street name (i.ei.e.., you own your shares through a brokerage, bank, or other institutional account), you are considered the beneficial owner of those shares, but not the record holder. This means that you vote by providing instructions to your broker rather than directly to Schlumberger. UnlessSLB. Brokers are not permitted to vote on certain proposals and may not vote on any of the proposals unless you provide voting instructions. Therefore, unless you provide specific voting instructions, your broker isshares may not permitted to vote your shares on your behalf, except on Item 3 and Item 4.be represented or voted at the meeting.
Brokers holding shares must vote according to specific instructions they receive from the beneficial owners of those shares. If brokers do not receive specific instructions, brokers may in some cases vote the shares in their discretion. However, the NYSE precludes brokers from exercising voting discretion, but are not permitted to vote on certain proposals without specificand may elect not to vote on any of the proposals unless you provide voting instructions. If you do not provide voting instructions and the broker elects to vote your shares on some but not all matters, it will result in a “broker non-vote” for the matters on which the broker does not vote. Abstentions occur when you provide voting instructions but instruct the broker to abstain from voting on a particular matter instead of voting for or against the beneficial owner, as follows:
matter. Abstentions and broker non-votes will be considered as present for quorum purposes, but they are not considered as votes cast and will not be counted in determining the outcome of the vote on the election of directors or on any of the other proposals.
StockholdersShareholders with shares registered in their names with Computershare may authorize a proxy:
By Internet www.proxypush.com/SLB | By Telephone (866) 240-5191 | By Mail Sign, date, and mail your proxy card |
The internet and telephone voting facilities for stockholdersshareholders of record will close at 11:59 p.m. Eastern time on Tuesday, April 5, 20224, 2023. The internet and telephone voting procedures have been designed to authenticate stockholdersshareholders and to allow you to vote your SLB shares and to confirm that your instructions have been properly recorded.
Many banks and brokerage firms participate in programs that also permit beneficial owners to direct their vote by the internet or telephone. If you are a beneficial owner whose shares are held in an account at a bank or brokerage firm that participates in such a program, you may direct the vote of those shares by the internet or telephone by following the instructions on any voting instruction form or electronic voting instructions that you receive from your bank or brokerage firm.
All shares entitled to vote and represented by properly executed proxies received prior to the meeting and not revoked will be voted at the meeting in accordance with your instructions. If you are a stockholdershareholder with shares registered in your name with Computershare and you submit a properly executed proxy card but do not direct how to vote on each item, the persons named as proxies will vote as the Board recommends on each proposal.
If you are a stockholdershareholder of record, you can change your vote or revoke your proxy at any time by timely delivering a properly executed, later-dated proxy (including an internet or telephone vote by April 5, 2022)4, 2023) or by voting by ballot at the meeting. If you hold shares through a broker, bank, or other holder of record, you must follow the instructions of your broker, bank, or other holder of record to change or revoke your voting instructions.
2023 Proxy Statement |
2023
We intend to file a proxy statement and WHITE proxy card with the SEC in connection with the Board’s solicitation of proxies for our 20232024 AGM. StockholdersShareholders may obtain a copy of our 20232024 proxy statement (and any amendments and supplements thereto) and other documents as and when filed with the SEC without charge from the SEC’s website at www.sec.gov.
In order for a stockholdershareholder proposal to be considered for inclusion in the proxy statement for our 20232024 AGM pursuant to Exchange Act Rule 14a-8, or for director nominations to be included pursuant to the Company’sSLB’s proxy access bylaw provisions, such proposals or notice of nominations must be received by the Secretary of the Company, 5599 San Felipe, 17thFloor, Houston, Texas 77056, no later than October 27, 2022,26, 2023, and, in the case of a proxy access nomination, no earlier than September 27, 2022.26, 2023.
For stockholdershareholder proposals to be introduced for consideration at our 20232024 AGM other than pursuant to Rule 14a-8 and for stockholdershareholder candidates to be nominated for election as directors other than pursuant to our proxy access bylaw provisions, notice must be delivered to the Secretary of the Company at our executive offices in Houston, Texas, not later than 120 days nor earlier than 150 days before the first anniversary of the date of the 20222023 AGM. Accordingly, any such notice must be received no earlier than November 7, 2022,2023, and no later than December 7, 2022,2023, and must otherwise satisfy the requirements of our bylaws. Under the rules of the Exchange Act, we may use discretionary authority to vote with respect to any proposal not included in our proxy materials that is properly presented by a stockholdershareholder in person at the 20232024 AGM if the stockholdershareholder making the proposal hasfails to meet these deadlines and fails to satisfy the requirements of Rule 14a-4 under the Exchange Act.
Further, to comply with the SEC’s universal proxy rules, if a shareholder intends to solicit proxies in support of director nominees submitted under these advance notice provisions, then we must receive proper written notice that sets forth all information required by Rule 14a-19 under the Exchange Act, delivered to the Secretary of the Company at our executive offices in Houston, Texas, by February 5, 2024 (or, if the 2024 AGM is called for a date that is more than 30 days before or more than 30 days after such anniversary date, then notice must be provided not givenlater than the close of business on the later of the 60th day prior to the 2024 AGM or the 10th day following the date on which public announcement of the 2024 AGM is made). The notice requirement under Rule 14a-19 is in addition to us by December 7, 2022.the applicable advance notice requirements under our bylaws as described above.
StockholdersShareholders may obtain a copy of our most recent Form 10-K filed with the SEC, including financial statements and schedules, without charge by writing to our Investor Relations Department, 5599 San Felipe, 17thFloor, Houston, Texas 77056, or by calling (713) 375-3535.
The CompanySLB will pay the cost of furnishing proxy materials to all stockholdersshareholders and of soliciting proxies by mail and telephone. We have retained D.F. King & Co., Inc. and its affiliate to assist in the solicitation of proxies for a fee estimated at $20,200$17,050 plus reasonable expenses. Directors,SLB directors, officers and employees of the Company may also solicit proxies for no additional compensation. We will reimburse brokerage firms, fiduciaries, and custodians for their reasonable expenses in forwarding the solicitation material to beneficial owners.
2023 Proxy Statement | 69 |
Other Matters
As of the date of this proxy statement, we know of no other business that will be presented at the meeting other than the matters described in this proxy statement. If any additional matters are properly presented at the meeting, we intend to vote the enclosed proxy in accordance with the discretion of the persons named in the proxy.
Please sign, date, and return the accompanying proxy in the enclosed envelope at your earliest convenience.
By order of the Board of Directors,
Dianne B. Ralston
Chief Legal Officer and Secretary
Houston, Texas
February 23, 2023
February 24, 2022
2023 Proxy Statement |
Reconciliation of
This proxy statement includes non-GAAP financial measures, including free cash flow, free cash flow margin, cash flow generation, adjusted EBITDA, adjusted EBITDA margin, earnings per share, excluding charges and credits, and net income, excluding charges and credits.credits, and net debt. Certain of these measures are used by management as performance metrics when determining incentive compensation for our executive officers. Below is a reconciliation of these non-GAAP financial measures to the comparable GAAP measures.
(Stated in millions) | ||||
Periods Ended December 31, | Twelve Months 2021 | |||
Cash flow from operations | $ | 4,651 | ||
Capital expenditures | (1,141 | ) | ||
APS investments | (474 | ) | ||
Multiclient seismic data capitalized | (39 | ) | ||
Free cash flow | $ | 2,997 | ||
Business acquisitions and investments, net of cash acquired plus debt assumed | (103 | ) | ||
Proceeds from sale of Liberty shares | 109 | |||
Other, net | (3 | ) | ||
Cash flow generation | $ | 3,000 |
(Stated in millions) | |||||
Year Ended Dec. 31, 2022 | |||||
Cash flow from operations | $ | 3,720 | |||
Capital expenditures | (1,618 | ) | |||
Asset Performance Solutions investments | (587 | ) | |||
Exploration data capitalized | (97 | ) | |||
Free cash flow | $ | 1,418 |
Free cash flow represents cash flow from operations less capital expenditures, APSAsset Performance Solutions investments and multiclient seismicexploration data costs capitalized. Management believes that free cash flow is an important liquidity measure for the Company and that it is useful to investors and management as a measure of Schlumberger’sSLB’s ability to generate cash. Free cash flow does not represent the residual cash flow available for discretionary expenditures. Free cash flow is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, cash flow from operations.
(Stated in millions) | ||||
Periods Ended December 31, | Twelve Months 2021 | |||
Net income attributable to Schlumberger | $ | 1,881 | ||
Net income attributable to noncontrolling interests | 47 | |||
Tax expense | 446 | |||
Income before taxes | $ | 2,374 | ||
Charges and credits: | ||||
Gain on sale of Liberty shares | (28 | ) | ||
Early repayment of bonds | 10 | |||
Unrealized gain on marketable securities | (47 | ) | ||
Depreciation and amortization | 2,120 | |||
Interest expense | 529 | |||
Interest income | (33 | ) | ||
Adjusted EBITDA | $ | 4,925 |
Free cash flow margin is calculated as free cash flow divided by revenue. Free cash flow margin measures how efficiently SLB converts revenue into free cash flow, and is an indicator of capital efficiency.
(Stated in millions) | |||||
Year Ended Dec. 31, 2022 | |||||
Net income attributable to SLB – GAAP basis | $ | 3,441 | |||
Net income attributable to noncontrolling interests | 51 | ||||
Tax expense | 779 | ||||
Income before taxes | $ | 4,271 | |||
Charges and credits: | |||||
Gain on Arabian Drilling Company equity investment | (107 | ) | |||
Gain on sale of Liberty shares | (325 | ) | |||
Gain on repurchase of bonds | (11 | ) | |||
Loss on Blue Chip Swap transactions | 139 | ||||
Gain on sale of real estate | (43 | ) | |||
Depreciation and amortization | 2,147 | ||||
Interest expense | 490 | ||||
Interest income | (99 | ) | |||
Adjusted EBITDA | $ | 6,462 |
Adjusted EBITDA represents income before taxes, excluding charges and credits, depreciation and amortization, interest expense, and interest income. Management believes that adjusted EBITDA is an important profitability measure for SchlumbergerSLB and that it allows investors and management to more efficiently evaluate Schlumberger’sSLB’s operations period over period and to identify operating trends that could otherwise be masked. Adjusted EBITDA is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP.
Adjusted EBITDA margin is calculated as adjusted EBITDA divided by revenue. For full-year 2022, adjusted EBITDA margin of 23.0% was calculated based on adjusted EBITDA of $6.462 billion divided by revenue of $28.091 billion.
2023 Proxy Statement | | A-1 | |||
(Stated in millions, except per share amounts) | ||||||||||||||||||||
Twelve Months 2021 | ||||||||||||||||||||
Pretax | Tax | Noncont. Interests | Net | Diluted EPS | ||||||||||||||||
Schlumberger net income (GAAP basis) | $ | 2,374 | $ | 446 | $ | 47 | $ | 1,881 | $ | 1.32 | ||||||||||
Gain on sale of Liberty shares | (28 | ) | (4 | ) | — | (24 | ) | (0.02 | ) | |||||||||||
Early repayment of bonds | 10 | — | — | 10 | 0.01 | |||||||||||||||
Unrealized gain on marketable securities | (47 | ) | (11 | ) | — | (36 | ) | (0.03 | ) | |||||||||||
Schlumberger net income, excluding charges and credits | $ | 2,309 | $ | 431 | $ | 47 | $ | 1,831 | $ | 1.28 |
(Stated in millions, except per share amounts) | ||||||||||||||||||||
Year Ended Dec. 31, 2022 | ||||||||||||||||||||
Pretax | Tax | Noncont. Interests | Net | Diluted EPS(1) | ||||||||||||||||
Net income attributable to SLB – GAAP basis | $ | 4,271 | $ | 779 | $ | 51 | $ | 3,441 | $ | 2.39 | ||||||||||
Gain on Arabian Drilling Company equity investment | (107 | ) | (3 | ) | – | (104 | ) | (0.07 | ) | |||||||||||
Gain on sale of Liberty shares | (325 | ) | (37 | ) | – | (288 | ) | (0.21 | ) | |||||||||||
Gain on repurchase of bonds | (11 | ) | (2 | ) | – | (9 | ) | (0.01 | ) | |||||||||||
Loss on Blue Chip Swap transactions | 139 | - | – | 139 | 0.10 | |||||||||||||||
Gain on sale of real estate | (43 | ) | (2 | ) | – | (41 | ) | (0.03 | ) | |||||||||||
Net income attributable to SLB, excluding charges and credits | $ | 3,924 | $ | 735 | $ | 51 | $ | 3,138 | $ | 2.18 |
(1) | Does not add due to rounding. |
(Stated in millions) | |||||
At Dec. 31, 2022 | |||||
Cash | $ | 1,655 | |||
Short-term investments | 1,239 | ||||
Short-term borrowings and current portion of long-term debt | (1,632 | ) | |||
Long-term debt | (10,594 | ) | |||
Net debt | $ | (9,332 | ) |
Net debt represents gross debt less cash and short-term investments. Management believes that net debt provides useful information regarding the level of SLB’s indebtedness by reflecting cash and investments that could be used to repay debt. Net debt is a non-GAAP financial measure that should be considered in addition to, not as a substitute for or superior to, total debt.
2023 Proxy Statement |
This page intentionally left blank
This page intentionally left blank