Shake-up at Shell may lead to job cuts as new chief takes the helm

Wael Sawan announces restructuring of energy company’s core business units in effort to boost shareholder returns

Shell’s new chief executive has announced a restructuring of the energy company’s core business units just a month after taking the helm, a move that could result in job cuts.

Shell will combine its integrated gas and upstream divisions, and merge its downstream and renewables units, it said on Monday. It is the second significant announcement in a week after chief executive Wael Sawan launched a strategic review of the company’s struggling European home-energy retail unit.

Mr Sawan is under pressure to boost shareholder returns, which have lagged behind those of key competitors. There had been speculation that a shake-up was on the cards after activist investor Dan Loeb called on the company to break off its liquefied natural gas, renewables and marketing divisions into a stand-alone business.

The restructuring plan could lead to job cuts, Reuters reported on Monday.


Shell is now choosing to fold clean energy into the refining segment. It will also discontinue its strategy, sustainability and corporate relations directorate. Strategy and sustainability units will report directly to chief financial officer Sinead Gorman.

“Fewer interfaces mean greater co-operation, discipline and speed, enabling us to focus on strengthening performance across the businesses and generating strong returns for our investors,” Mr Sawan said in a statement. “We’re changing to ensure we become a great investment.”

Under the changes, expected to take effect from July 1st, Shell will reduce the size of its executive committee from nine to seven members. The move will not affect financial reporting segments, according to the statement.

“In terms of becoming more efficient and streamlining, Shell has more wood to chop,” said Christyan Malek, global head of energy strategy at JPMorgan Chase. “This is the beginning of a series of improvements to efficiencies within Shell to improve returns and drive more value for every dollar invested.”

On January 26th, Shell said it was starting a review of its domestic energy unit after the business proved a weak spot during the energy crisis. European power and gas retailers have been under stress in the past year as prices soared following Russia’s invasion of Ukraine.

– Bloomberg, Reuters