2024AGM – Delphine Boyer on ISPP Upgrade

[Johannes Wijsman]

I just listened to the recording of the 2024AGM, with particular interest for the Delphine Boyer presentation on ISPP and DMP. Well, different presenter but same message as given by Jane Thompson last year: we increase the DMP premiums because, you know, things have gotten more expensive. But we keep the ISPP amounts frozen because, in essence, we really don’t care about our retirees.

I decided to browse through the Employee Manuals of the four product lines that I worked for (W&T, Geco Prakla, Sedco Forex and OFS). These manuals differ when it comes to the Pension Plan. The most interesting one is the Sedco Forex International Mobile Pension Plan dated March 1997. It has a section named “Review of Pension Benefits” which reads as follows:

“Schlumberger conducts periodic reviews of the pension levels of those who have retired, and may update these pensions from time to time. Schlumberger also reviews the accrued pension benefits of active participants and may decide to adjust the accrued rights of the participants still employed by Schlumberger at the date of such revision. No automatic form of indexation is guaranteed. The cost of an adjustment cannot be predicted and the Company will not make such an open-ended commitment which would remove its ability to control its expenses. Periodic reviews and reevaluations of the pension levels are decided by the Company, whenever deemed necessary and affordable”.

Used as a conjunction “whenever” means “at any or every time that”. If ever challenged, could SLB seriously claim that, after freezing the pensions for 14 years, an increase is not necessary? And is it affordable? Most definitely a moot point for a company that spent more than $2 billion on buying back its own shares in 2023-2024.

And another question would be: if the company made adjustments every 5 years until 2010, why was it deemed necessary and affordable then and not now?

I think all of us understood the decision to not adjust in 2015. The oil price had crashed and the whole industry was in a severe downturn. Many employees lost their job and the company paid $880 million for workforce reductions. No adjustment in 2020 is also understandable. The Covid-19 pandemic almost brought the industry to a standstill. Schlumberger terminated 21,000 employees at a cost of $1.1 billion. Not a year to announce a pension increase.

But, baring another catastrophic event hitting the industry, 2025 looks to be the year for the company to do something. I do not expect an adjustment for all purchasing power lost since 2010, but a partial compensation is now long overdue. We can only hope that Management will have a change of heart and does the right thing.

[Charles Ingold]

Well said, shame on them

[El Hachemi Abdelhak]

Delphine,

Thank you for your message.

Inflation is indeed a global concern, and it’s only expected to rise. Most reputable pension providers regularly review their pensions to account for such economic changes. In the UK, for instance, there’s the triple lock mechanism which ensures the basic and new State Pension increases yearly by the highest of earnings growth, inflation, or 2.5%.

While we’re not asking for something as comprehensive as the triple lock, we believe that, given the recent performance of our pension funds, a reasonable increase in pensions would align with the values and ethics of SLB.

[Author]

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