Schlumberger Limited (SLB) DEF 14ADefinitive proxy

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES

EXCHANGE ACT OF 1934

(Amendment No.     )

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SCHLUMBERGER N.V. (SCHLUMBERGER LIMITED)

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Notice of 2021 Annual General Meeting of Stockholders

 

 

ITEMS OF BUSINESS

 

	1.	Election of the eight director nominees named in this proxy statement.
	2.	Approval of an advisory resolution regarding our executive compensation.
	3.	Report on the course of business during the year ended December 31, 2020; approval of our consolidated balance sheet as at December 31, 2020; our consolidated statement of income for the year ended December 31, 2020; and our Board of Directors’ declarations of dividends in 2020, as reflected in our 2020 Annual Report to Stockholders.
	4.	Ratification of the appointment of PricewaterhouseCoopers LLP as our independent auditors for 2021.
	5.	Approval of an amendment and restatement of the 2017 Schlumberger Omnibus Stock Incentive Plan.
	6.	Approval of an amendment and restatement of the Schlumberger Discounted Stock Purchase Plan.
	7.	Approval of an amendment and restatement of the 2004 Stock and Deferral Plan for Non-Employee Directors.

 

Such other matters as may properly be brought before the meeting.

 

By order of the Board of Directors,

 

Alexander C. Juden Secretary	Dianne B. Ralston Chief Legal Officer

 

February 25, 2021

Wednesday, April 7, 2021

 

10:00 a.m. Curaçao time

 

Johan van Walbeeckplein 11, Willemstad, Curaçao

 

PROXY 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 cannot vote for Items 1, 2, 5, 6 or 7 without your instructions.

 

RECORD DATE

 

February 17, 2021

 

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 see which voting methods are available to you. Stockholders with shares registered in their names with Schlumberger’s transfer agent may authorize a proxy:

 

		BY INTERNET www.proxypush.com/SLB
		BY TELEPHONE (866) 240-5191
		BY MAIL Sign, date, and mail your proxy card

 

If you are a beneficial holder of Schlumberger common stock, you should follow any instructions provided by your bank, broker or other nominee. See “General Information” in this proxy statement.

Table of Contents

 

Proxy Summary

 

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information that you should consider, and you should read the entire proxy statement carefully before voting. In addition, we are providing our 2020 Annual Report to Stockholders concurrently with this proxy statement. You should refer to its contents in considering agenda Item 3.

 

All references in this proxy statement to “the Company,” “Schlumberger,” “we” or “our” are to Schlumberger Limited (Schlumberger N.V.) and its subsidiaries.

 

Voting at the 2021 Annual General Meeting (pages 85-86)

 

Schlumberger’s 2021 annual general meeting of stockholders will be held at Johan van Walbeeckplein 11, Willemstad, Curaçao, on Wednesday, April 7, 2021 beginning at 10:00 a.m., Curaçao time.

 

Each stockholder of record at the close of business on February 17, 2021 (the “record date”) 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’s name. Stockholders with shares registered in their names with Schlumberger’s transfer agent may authorize a proxy:

 

		BY INTERNET www.proxypush.com/SLB
		BY TELEPHONE (866) 240-5191
		BY MAIL Sign, date, and mail your proxy card

 

Persons who held shares on the record date through a broker, bank or other nominee are referred to as beneficial owners. If you are a beneficial holder of Schlumberger common stock, you should follow the voting instructions provided by your bank, broker or other nominee.

 

If you plan to attend the annual general meeting in person, please refer to “General Information—General” on page 85 for the requirements for admission to the meeting. 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.

 

The mailing date of this proxy statement is February 25, 2021. Business at the meeting will be conducted in accordance with the procedures determined by the Chairman of the meeting and will be limited to matters properly brought before the meeting by or at the direction of our Board or by a stockholder.

 

Voting Matters

 

	Item			Our Board’s Recommendation		Page Reference (for more detail)
	1	Election of the eight director nominees named in this proxy statement.		FOR each nominee		8
	2	Approval of an advisory resolution regarding our executive compensation.		FOR		27
	3	Approval of our consolidated balance sheet as at December 31, 2020, our consolidated statement of income for the year ended December 31, 2020, and the declarations of dividends by our Board in 2020.		FOR		66
	4	Ratification of the appointment of PricewaterhouseCoopers LLP as our independent auditors for 2021.		FOR		67
	5	Approval of an amendment and restatement of the 2017 Schlumberger Omnibus Stock Incentive Plan.		FOR		69
	6	Approval of an amendment and restatement of the Schlumberger Discounted Stock Purchase Plan.		FOR		77
	7	Approval of an amendment and restatement of the 2004 Stock and Deferral Plan for Non-Employee Directors.		FOR		81

 

 

Our Board Nominees (pages 8-12)

 

Below is summary information about the nominees to our Board of Directors (the “Board”).

 

Patrick de La Chevardière Former Chief Financial Officer Total S.A. Director since 2019 Age: 63 Committees: Audit, Finance INDEPENDENT		Miguel M. Galuccio Chairman and CEO Vista Oil & Gas Director since 2017 Age: 52 Committees: Finance, Science and Technology NON-EXECUTIVE		Olivier Le Peuch Chief Executive Officer Schlumberger Limited Director since 2019 Age: 57 Committees: None EXECUTIVE		Tatiana A. Mitrova Director of the Energy Centre Moscow School of Management SKOLKOVO Director since 2018 Age: 46 Committees: Audit, Finance INDEPENDENT
Maria Moræus Hanssen Former Deputy CEO & COO Wintershall Dea GmbH Director since 2020 Age: 56 Committees: Compensation, Nominating and Governance INDEPENDENT		Mark G. Papa Former Chairman and CEO Centennial Resource Development Director since 2018 Age: 74 Committees: Compensation, Science and Technology INDEPENDENT BOARD CHAIR		Henri Seydoux Chairman and CEO Parrot S.A. Director since 2009 Age: 60 Committees: Nominating and Governance, Science and Technology, Compensation INDEPENDENT		Jeff. W. Sheets Former EVP and CFO ConocoPhillips Director since 2019 Age: 63 Committees: Audit, Compensation INDEPENDENT

 

Board Highlights (pages 16-18)

 

 

 

ITEM 1. Election of Directors

All of our directors are elected annually at our annual general meeting of stockholders. Our stockholders are requested to elect eight nominees to the Board, each to hold office until the next annual general meeting of stockholders and until a director’s successor is elected and qualified or until a director’s death, resignation or removal. Each of the nominees is now a director and was previously elected by our stockholders at the 2020 annual general meeting of stockholders, except for Maria Moræus Hanssen, who was appointed by the Board to serve as a director effective October 15, 2020, based upon the recommendation of the Nominating and Governance Committee of the Board.

Having exceeded the normal retirement age of 70 under our Corporate Governance Guidelines, Leo Rafael Reif will not stand for re-election at our annual general meeting of stockholders. Lubna S. Olayan also will not stand for re-election at our annual general meeting of stockholders. Our Board extends gratitude to Dr. Reif and Ms. Olayan for 14 years of service and 10 years of service, respectively.

All of the nominees for election have consented to being named in this proxy statement and to serve if elected. If any nominee is unable or unwilling to serve, the Board may 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 this annual general meeting, 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 will be voted, if authority to do so is not withheld, for the election of each of the eight nominees named below.

In 2016, our stockholders voted to fix the number of directors constituting the Board at 12, as permitted under our Articles of Incorporation. However, only eight directors have been nominated for election at the 2021 annual general meeting of stockholders. The Board believes that it is advisable and in the best interests of our stockholders for the authorized number of directors constituting the Board to remain at 12. This will allow the Board to conduct a search for, and add, up to four additional directors prior to the 2022 annual general meeting.

Required Vote

Each director nominee must receive a majority of the votes cast to be elected.

Brokers do not have discretion to vote on this proposal without your instruction. If you do not instruct your broker how to vote on this proposal, your broker will deliver a non-vote on this proposal.

The Board of Directors Recommends a Vote FOR All Director Nominees.

Director Nominees

The Board believes that each director nominee possesses the qualities and experience that the Nominating and Governance Committee has determined that nominees should possess, as described in detail below under “Corporate Governance—Identifying Candidates for Director Nominations” beginning on page 17. The Board seeks out, and the Board consists of, individuals whose background, experience and skills complement those of other Board members. In the judgment of the Board, each director nominee is able to execute his or her duties as a member of the Board and to devote the necessary time and attention to the Company, as required by our Corporate Governance Guidelines. There are no family relationships among any executive officers and directors of the Company.

The nominees for election to the Board, together with biographical information furnished by each of them and information regarding each nominee’s director qualifications, are set forth on the following pages.

Patrick de La Chevardière, Independent Director
		Former Chief Financial Officer, Total S.A.   Director since 2019   Age: 63   Other Current Public Boards • Michelin (Compagnie Générale des Établissements Michelin SCA)   Former Public Directorships Held During the Past 5 Years • None Citizenship France   Board Committees • Audit • Finance   Other Experience and Education • Former CFO of public multinational oil and gas company • 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 significant financial and energy industry experience as a former chief financial officer of a large multinational oil and gas company. The Board benefits greatly from his customer-focused perspective on the oilfield services industry, as well as from his experience across the entire oil and gas value chain, from exploration, operations, production, trading and marketing to refining and new energies.

Miguel M. Galuccio, Non-Executive Director
		Chairman and Chief Executive Officer, Vista Oil & Gas   Director since 2017   Age: 52   Other Current Public Boards • Vista Oil & Gas   Former Public Directorships Held During the Past 5 Years • YPF S.A. Citizenship Argentina and United Kingdom   Board Committees • Finance, Chair • Science and Technology   Other Experience and Education • Current chief executive officer of public oil and gas company • Bachelor of Science in Petroleum Engineering, Instituto Tecnológico de Buenos Aires • Schlumberger training and expertise • Latin America energy policy expertise
MIGUEL GALUCCIO is the Chairman and Chief Executive Officer of Vista Oil & Gas, an oil and gas company incorporated in Mexico, and has held that position since July 2017. From 2012 to March 2016, he was the Chairman and Chief Executive Officer of YPF, Argentina’s national oil company. From 1999 to 2012, he was an employee of Schlumberger and held a number of international positions, his last being President, Schlumberger Production Management. Prior to his employment at Schlumberger, 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 strong leadership and operational expertise from his experience as former chairman and chief executive officer of Argentina’s national oil 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, Ecuador and other countries that are strategically important to Schlumberger. He has extensive experience negotiating with Schlumberger customers in Latin America, Russia and China, including global energy companies and national oil companies, and remains active in the oil and gas exploration and production industry as a chief executive officer of an oil and gas company.

Olivier Le Peuch, Schlumberger Chief Executive Officer
		Chief Executive Officer, Schlumberger Limited   Director since 2019   Age: 57   Other Current Public Boards • None   Former Public Directorships Held During the Past 5 Years • None Citizenship France   Board Committees • None   Other Experience and Education • Master’s Degree in Microelectronics, Bordeaux University of Science • Schlumberger training and expertise
OLIVIER LE PEUCH has been the Chief Executive Officer and a director of Schlumberger since August 2019. He was the Company’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 product lines from February 2017 to May 2018, President of Schlumberger 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 Company 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’s operational activities worldwide as a result of his service in various global leadership positions in the Company. The Board believes that Mr. Le Peuch’s service as Chief Executive Officer 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’s business and operations.

Tatiana A. Mitrova, Independent Director
		Director of the Energy Centre, Moscow School of Management SKOLKOVO   Director since 2018   Age: 46   Other Current Public Boards • PAO Novatek   Former Public Directorships Held During the Past 5 Years • Unipro PJSC Citizenship Russia and Israel   Board Committees • Audit • Finance   Other Experience and Education • PhD in Economics, Moscow State University • Senior Visiting Research Fellow at Oxford Institute for Energy Studies • Fellow at SIPA Center on Global Energy Policy at Columbia University
TATIANA A. MITROVA has been the Director of the Energy Centre of the Moscow School of Management SKOLKOVO, a graduate business school, since February 2017. 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 (PSIA), part of the Paris Institute of Political Studies, since 2014; 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 April 2016 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. She was previously a member of the board of directors of Unipro PJSC from 2014 to December 2017 and was a member of its appointment and remuneration committees.
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’s products and services, as well as expertise relating to sustainability, decarbonization and the new energy economy. The Board values Dr. Mitrova’s connections to the Russia market and 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’s business strategy. She provides additional ties to universities worldwide, assisting Schlumberger in its effort to attract talented new employees.

Mark G. Papa, Independent Chairman of the Schlumberger Board
		Former Chairman and CEO, Centennial Resource Development, Inc.   Director since 2018   Age: 74   Other Current Public Boards • None   Former Public Directorships Held During the Past 5 Years • • Centennial Resource Development, Inc. • Oil States International Citizenship United States of America   Board Committees • Compensation, Chair • Science and Technology   Other Experience and Education • Former chairman and CEO of two public oil and natural gas companies • MBA, University of Houston • Bachelor of Science in Petroleum Engineering, University of Pittsburgh • • North American energy industry pioneer
MARK G. 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 October 2016 until his retirement in March 2020. Mr. Papa served as Chief Executive Officer and Chairman of the Board of Silver Run Acquisition Corp. from 2015 until its business combination with Centennial Resource Production, LLC in October 2016. From 2015 to December 2019, Mr. Papa served as an advisor to Riverstone Holdings, LLC, 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, Inc., an international field services company, from 2001 to August 2018 and was a member of its compensation and nominating and corporate governance committees. From 2006 to 2020, he served on the board of Casa de Esperanza, a non-profit organization serving children in crisis situations.
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’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 Schlumberger in these areas.

Henri Seydoux, Independent Director
		Chairman and Chief Executive Officer, Parrot S.A.   Director since 2009   Age: 60   Other Current Public Boards • Parrot S.A.   Former Public Directorships Held During the Past 5 Years • None Citizenship France   Board Committees • Compensation • Nominating and Governance • Science and Technology   Other Experience and Education • Current chief executive officer • Technology leadership • Entrepreneurial and management expertise
HENRI SEYDOUX has been Chairman and Chief Executive Officer of Parrot S.A., a global wireless products manufacturer, since 1994. Mr. Seydoux is an entrepreneur with great initiative. He founded Parrot S.A. in 1994 as a private company and took it public in 2006. From 2014 to June 2020, he also served on the board of directors of Sigfox, a privately-held global communications service provider.
Relevant Skills and Expertise Mr. Seydoux, as the chief executive of a dynamic and innovative technology company, brings to the Board entrepreneurial drive and management skills. He also has family ties to the founding Schlumberger brothers. Having grown up in the Schlumberger family culture, Mr. Seydoux is well placed to see that the Company continues its historical commitment to Schlumberger’s core values. His service on the Board addresses the Company’s need to preserve the Company’s unique culture and history while helping to foster innovation.

Jeff W. Sheets, Independent Director
		Former EVP and Chief Financial Officer, ConocoPhillips   Director since 2019   Age: 63   Other Current Public Boards • Enerplus Corporation • Westlake Chemical Corporation   Former Public Directorships Held During the Past 5 Years • None Citizenship United States of America   Board Committees • Audit, Chair • Compensation   Other Experience and Education • Former CFO of public international oil and gas company • MBA, University of Houston • Bachelor of Science in Chemical Engineering, Missouri University of Science and Technology
JEFF W. SHEETS is the former Executive Vice President 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 February 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, Sheets has served on the board of directors of Enerplus Corporation, a Canadian oil and gas company, where he chairs the safety and social responsibility committee and is a member of the audit and risk management and reserves committees. 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. 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 strong financial and operational expertise as a former chief financial officer of a large upstream oil and gas company. The Board benefits greatly from Mr. Sheets’ expertise in developing and implementing corporate strategy in the oil and gas industry, his significant finance and mergers and acquisitions experience, and his experience as an independent director of two other public companies.

Corporate Governance

We are committed to adhering to sound principles of corporate governance and 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.

We have also adopted a code of conduct entitled The Blue Print and The Blue Print in Action (together, our “Code of Conduct”), which applies to all of our 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.

Our governance practices, as detailed in our Bylaws, Corporate Governance Guidelines, Code of Conduct, policies and other business practices, include:

Board Leadership Structure

One of the Board’s key responsibilities is to evaluate and determine an appropriate board leadership structure to provide for independent oversight of 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 vary for a single company as circumstances change.As such, our independent directors consider the Board’s leadership structure at least annually.

The independent members of the Board have determined that the appointment of an independent Chairman of the Board is an appropriate Board leadership structure at this time because it allows our CEO to focus on leading the Company’s complex international business operations, while providing the Board experienced and independent leadership. The independent members of the Board appointed Mark Papa as the Chairman of the Board in August 2019. As independent Chairman, Mr. Papa sets the agenda for, and leads, all Board meetings and all executive sessions of the non-executive directors.

In light of Mr. Papa’s appointment as the independent Chairman of the Board, the Board does not currently have a designated lead independent director. The Board may modify this structure to best address the Company’s unique circumstances and advance the best interests of all stockholders, as and when appropriate. In the event that the Company modifies this leadership structure in the future and appoints a lead independent director, that director’s responsibilities would be expected to include setting the agenda for all Board meetings (together with the Chairman), setting the agenda for and leading all executive meetings of the non-executive directors, and providing consolidated feedback, as appropriate, from those meetings to the Chairman. It is expected that the lead independent director would also have authority to call meetings of the Board in executive session; facilitate discussions, outside of scheduled Board meetings, among the independent directors on key issues as appropriate; and serve as a non-exclusive liaison with the Chairman and CEO, in consultation with the other independent directors.

Schlumberger’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. These governance practices are reflected in our Corporate Governance Guidelines and our committee charters, which are available on our website. The Board believes that its risk oversight programs, discussed on the following page, would be effective under a variety of board leadership frameworks and therefore do not materially affect the Board’s choice of leadership structure.

The Board’s Role in Risk Oversight

As set forth in our Corporate Governance Guidelines, the Board routinely assesses major risks facing the Company and options for their mitigation, in order to promote the Company’s stockholders’ and other stakeholders’ interests in the long-term health, financial strength, and overall success of the Company.

The Board is actively involved in overseeing risk management for the Company. We believe that our Board composition provides the Company with robust experience in several areas of risk oversight. Several of our Board members, including Dr. Mitrova, Ms. Moræus Hanssen, and Messrs. Galuccio, Le Peuch and Papa, have valuable experience in the regulatory, economic and commodity risks that are specific to the energy industry. Mr. Seydoux has expertise in science and technology issues, and Dr. Mitrova and Ms. Moræus Hanssen have valuable experience addressing risks related to the energy transition and sustainability. In addition, many members of our Board provide expertise in general business governance, capital allocation, management and economic trends relevant to our business.

Each of our Board committees considers the risks within its areas of responsibility. The Board and its committees exercise their risk oversight responsibilities in a variety of ways, including as set forth in the chart below.

For additional details, see “—Board Responsibilities, Committees and Attendance” below.

The Board also manages risk, in part, through its oversight of the Company’s Executive Risk Committee (the “ERC”). The ERC is not a committee of the Board; rather, it comprises top Company executives from various functions, each of whom supervises day-to-day risk management throughout the Company. The ERC’s purpose is to identify those risks that have the potential to significantly affect our business over the short-, medium- and long terms — and therefore to impact our strategic objectives — and to implement appropriate mitigation measures.

The Company’s risk identification is performed annually at two levels. The ERC performs a corporate-level risk mapping exercise, which involves the CEO and several other members of senior management, and while maintaining oversight, delegates operational (field-level) risk assessment and management to the Company’s various geographies, businesses and functions. To the extent that the ERC identifies recurring themes from the operational risk mapping exercises, they are acted on at the corporate level. Members of the ERC meet formally at least once a year, and more frequently on an ad hoc basis, to define and improve the risk mapping process, and to review and monitor the results of those exercises and those that have been delegated. The ERC reports directly to our CEO and to the Board, and annually presents to the Board a comprehensive report as to its risk mapping efforts for that year.

Our Commitment to Sustainability

Our vision is to define and drive high performance, sustainably. We are committed 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. We are reducing our own environmental footprint, and we believe we are uniquely positioned to help our customers reach their own sustainability goals.

At Schlumberger, responsible environmental and social sustainability is an integral part of our culture and the way we operate. Our approach to sustainability, which we refer to as “Global Stewardship,” addresses opportunities and risks associated with the energy transition and climate change; protecting the environment; investing in and engaging with our workforce and the communities where we and our customers live and work; and promoting diversity and inclusion and respect for human rights.

For additional details about our sustainability programs and initiatives, see our annual Global Stewardship Report, which is available at www.slb.com/sustainability.

Stockholder Engagement

Our relationship and on-going dialogue with our stockholders are important parts of our Board’s corporate governance commitment. Our investor relations, sustainability, legal and human resources teams engage with stockholders to seek their views on key matters and to inform our management and our Board about the issues and emerging governance trends that our stockholders 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 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 more detail on our 2020 engagement with our stockholders, see “Compensation Discussion and Analysis—Framework for Setting Executive Compensation in 2020—Stockholder Engagement; 2020 Say-On-Pay Vote” on page 33 of this proxy statement.

Director Independence

Our Corporate Governance Guidelines provide that at least a majority of the Board must consist of independent directors. This minimum standard reflects the New York Stock Exchange (“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” is “independent” under the listing standards of the NYSE and our director independence standards, except for Mr. Le Peuch, who is our CEO and therefore does not qualify as independent, and Mr. Galuccio. Additionally, Ms. Olayan and Dr. Reif are independent, and Peter Currie, Nikolay Kudryavtsev and Indra Nooyi were independent throughout the period in 2020 that each of them served on the Board. In addition to the Board-level standards for director independence, the Board has determined that each current member of the Audit Committee meets the heightened independence standards required for audit committee members under the NYSE’s listing standards and the rules of the Securities and Exchange Commission (“SEC”), and each member of the Compensation Committee meets the heightened independence standards for compensation committee members under NYSE listing standards.

Our Board’s independence determinations included a review of transactions that occurred since the beginning of 2018 with entities associated with our directors or members of their immediate family. In making its independence determinations, the Board considered that Dr. Kudryavtsev, Dr. Mitrova, Ms. Moræus Hanssen, Ms. Nooyi, Ms. Olayan, Mr. Papa, Dr. Reif and Mr. Sheets each serve, or have served, as directors, executive officers, 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 involving significantly less than the greater of $1 million or 1% of the other entity’s annual revenues during 2020, 2019 and 2018; except that one entity for which Mr. Sheets currently serves as a director, and one entity for which Mr. Papa previously served as an executive officer, had ordinary course commercial transactions with the Company involving less than 2% of each such entity’s 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 of less than $120,000 per year to certain institutions with which some of the directors are affiliated, as well as the following charitable contributions:

No director received any personal benefit from any such charitable contributions.

Board Refreshment

We believe that tenure diversity and Board refreshment are important, as directors with many years of service provide the Board with a deep knowledge of our Company, while newer directors lend fresh perspectives. The following charts reflect the balanced tenure and ages of our director nominees.

Under our Corporate Governance Guidelines, non-executive directors are eligible to be nominated or renominated to the Board up to their 70^th birthday, and executive directors are eligible to be nominated or renominated up to their 65^th 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. The Board waived this policy for Mr. Papa upon the recommendation of the Nominating and Governance Committee because it believes that having Mr. Papa serve as the Board’s independent Chairman is in the best interests of our Company and our stockholders.

Identifying Candidates for Director Nominations

The Nominating and Governance Committee believes that director nominees should, in the judgment of the Board, be persons of integrity and honesty, 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 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 conflict of interest or legal issues.

The Nominating and Governance Committee also promotes our diversity policy that the Board should ensure that qualified candidates reflecting the gender, cultural and geographical diversity of the Company are considered as potential director nominees. With our diverse workforce representing over 160 nationalities, we value gender, cultural and geographical diversity, and our culture of recruiting, hiring and training where we operate influences the composition of our Board.

Directors who are dual citizens are represented by the geographic region in which they currently reside.

Two of our eight director nominees are women. Of our eight director nominees, three are citizens of France, two are citizens of the United States of America, one is a citizen of Norway, one is a dual citizen of both Russia and Israel, and one is a dual citizen of both Argentina and the United Kingdom. Our geographically diverse Board evidences our commitment to have directors who represent countries where we operate. In addition, the exceptionally broad and diverse experience of our Board nominees is in keeping with our goal of having directors whose backgrounds and experience complement those of other directors. The Nominating and Governance Committee’s evaluation of director nominees takes into account their ability to contribute to the Board’s diversity. The Nominating and Governance Committee annually reviews its effectiveness in balancing these considerations in the context of its consideration of director nominees.

Another goal of the Nominating and Governance Committee is to seek out nominees having experience, skills and other attributes that complement the whole Board as a governing body. We believe that our director nominees are able to provide a well-rounded set of expertise that will assist in effective oversight of management at Schlumberger. The matrix below identifies the primary skills, core competencies and other attributes that each director nominee brings to bear in their service to our Board and committees. Each director nominee possesses numerous other skills and competencies not identified below. We believe identifying primary skills is a more meaningful presentation of the key contributions and value that each director nominee brings to their service on the Board and to our stockholders. Further information on each director nominee, including some of their specific experiences, skills and other attributes, is set forth in the biographies beginning on page 9 of this proxy statement.

	Summary of Director Primary Skills and Experience
	Current or former CEO or president
	Energy industry expertise
	Risk management experience
	Corporate finance/capital management expertise
	Academic relations
	Scientific and technological innovation experience
	M&A experience
	Experience in key Schlumberger markets
	Government, public policy and regulatory insights

Applying the criteria above, the Nominating and Governance Committee recommends to the Board the number and names of persons to be proposed by the Board for election as directors at our annual general meeting of stockholders. In obtaining the names of possible 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 concerning candidates, and interviews with selected candidates.

From time to time, the 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 ethnically diverse candidates in the proposals they present to us. During 2020, the Committee used the services of Spencer Stuart, a third-party executive search firm, for this purpose. Spencer Stuart suggested Ms. Moræus Hanssen as a prospective Board candidate.

The Nominating and Governance Committee will consider nominees recommended by stockholders who meet the eligibility requirements for submitting stockholder proposals for inclusion in the next proxy statement and submit their recommendations in writing to:

Chair, Nominating and Governance Committee
c/o Secretary, Schlumberger Limited
5599 San Felipe, 17^th Floor
Houston, Texas 77056.

Such recommendations must be submitted by the deadline for stockholder proposals referred to under “Other Information—Stockholder Proposals for Our 2022 Annual General Meeting” on page 87. 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.

Board Responsibilities, Committees and Attendance

Board Responsibilities

The Board oversees and counsels the Company’s CEO and other members of the senior management team in managing in the long-term interests of the Company and our stockholders. The Board’s responsibilities include:

Committees

The following table reflects the membership of the Board’s five standing committees as of February 1, 2021:

Name of Director	Audit Committee	Compensation Committee	Nominating and Governance Committee	Finance Committee	Science and Technology Committee
Patrick de La Chevardière
Miguel M. Galuccio				Chair
Tatiana A. Mitrova
Maria Moræus Hanssen
Lubna S. Olayan(1)			Chair
Mark G. Papa*		Chair
Leo Rafael Reif(1)					Chair
Henri Seydoux
Jeff W. Sheets	Chair

Audit Committee

The Audit Committee consists of three directors, each of whom meets the independence and other requirements of the NYSE’s listing standards and SEC rules (including the heightened requirements that apply to audit committee members). The Audit Committee assists the Board in its oversight of the accounting and financial reporting process of the Company, including: the audit of the Company’s financial statements; the integrity of the Company’s financial statements; legal and regulatory compliance; the independent auditor’s qualifications, independence and performance; and the performance of the Company’s internal audit function.

The authority and responsibilities of the Audit Committee include the following:

The Company’s independent auditor is accountable to the Audit Committee. The Audit Committee pre-approves all engagements, including the fees and terms for the integrated audit of the Company’s consolidated financial statements.

The Board has determined that each Committee member has sufficient knowledge in financial and auditing matters to serve on the Committee. In addition, the Board has determined that each of Messrs. de La Chevardière and Sheets qualifies as an “audit committee financial expert” under applicable SEC rules. The Audit Committee operates pursuant to a written charter, which describes its authority and responsibilities in detail, and is available on the Company’s website at https://www.slb.com/who-we-are/corporate-governance/audit-committee.

Compensation Committee

The Compensation Committee consists of five directors, each of whom meets the independence requirements of the NYSE’s listing standards (including the heightened requirements that apply to compensation committee members). The Compensation Committee assists our Board in discharging its responsibilities with regard to executive compensation; periodically reviews non-executive directors’ compensation; oversees the Company’s general compensation philosophy, policy and programs; serves as the administrative committee under the Company’s stock plans; and prepares the annual compensation committee report required by the rules of the SEC.

The authority and responsibilities of the Compensation Committee include the following:

The Compensation Committee may delegate specific responsibilities to one or more individual committee members to the extent permitted by law, regulation, NYSE listing standards and Schlumberger’s governing documents. The design and day-to-day administration of all compensation and benefits plans and related policies, as applicable to executive officers and other salaried employees, are handled by the Company’s human resources, finance and legal departments. The Compensation Committee operates pursuant to a written charter, which describes its authority and responsibilities in detail, and is available on the Company’s website at https://www.slb.com/who-we-are/corporate-governance/compensation-committee.

Nominating and Governance Committee

The Nominating and Governance Committee consists of four directors, each of whom meets the independence requirements of the NYSE’s listing standards. The Nominating and Governance Committee assists the Board in identifying qualified individuals to become directors; nominates directors to serve on, and chair, committees; reviews corporate governance trends; develops and recommends to the Board a set of Corporate Governance Guidelines and any amendments; monitors and reviews the effectiveness of the Company’s Ethics and Compliance Program; oversees the Company’s corporate reputation, sustainability and social responsibility strategies; and oversees the Board and its committees’ annual performance review.

The authority and responsibilities of the Nominating and Governance Committee include the following:

The Nominating and Governance Committee operates pursuant to a written charter, which describes its authority and responsibilities in detail, and is available on the Company’s website at https://www.slb.com/who-we-are/corporate-governance/nominating-and-governance-committee.

Finance Committee

The Finance Committee consists of four directors. The Finance Committee advises the Board and management of the Company on various capital allocation and capital structure matters, including dividends, stock repurchases, acquisitions and divestitures, financial risk management policies and the investment of funds. The Finance Committee operates pursuant to a written charter, which describes its authority and responsibilities in detail, and is available on the Company’s website at https://www.slb.com/who-we-are/corporate-governance/finance-committee.

Science and Technology Committee

The Science and Technology Committee consists of four directors. The Science and Technology Committee advises the Board and management on matters involving the Company’s research and development programs. The Science and Technology Committee operates pursuant to a written charter, which describes its authority and responsibilities in detail, and is available on the Company’s website at https://www.slb.com/who-we-are/corporate-governance/science-and-technology-committee.

Board Meetings and Attendance

The Board and its committees met throughout 2020 on a set schedule, held special meetings, and acted by written consent from time to time, as appropriate, as reflected in the following table:

At each Board meeting, time is reserved for the independent directors to meet in executive session without the CEO present. Officers regularly attend Board meetings to present information on our business and strategy, and Board members 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 such consultants on behalf of the relevant committee.

Each of our current directors attended at least 75% of the meetings of the Board and the committees on which he or she served in 2020 (held during the period he or she served).

The Board’s policy regarding director attendance at annual general meetings of stockholders is that directors are welcome, but not required, to attend, and that the Company will make all appropriate arrangements for directors who choose to attend. No director attended our annual general meeting of stockholders in 2020.

Other Key Governance Policies and Practices

Prohibition on Hedging or Pledging of Schlumberger Stock

Our directors and executive officers are prohibited from using any strategies or products (such as derivative securities or short-selling techniques) to hedge, directly or indirectly, against the potential changes in the value of Schlumberger common stock. In addition, our directors and executive officers, and 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.

Policy Against Lobbying and Political Contributions

We have a strong culture of being politically neutral, and have a long-standing policy against lobbying or making financial or in-kind contributions to political parties or candidates, even when permitted by law. This policy, as set forth in our Code of Conduct, prohibits the use of Company funds or assets for political purposes, including for contributions to any political party, candidate or committee, whether federal, state or local. In addition, the Company does not lobby. As a result of our policy of political neutrality, Schlumberger does not have a political action committee, nor does it contribute to any third-party political action committees or other political entities organized under Section 527 of the U.S. Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”).

In 2020, the Center for Political Accountability, a non-profit, non-partisan organization, assessed our disclosure for its annual CPA-Zicklin Index of Corporate Political Disclosure and Accountability. The CPA-Zicklin Index measures the transparency, policies and practices of the Standard & Poor’s 500. We achieved a perfect score of 100% in the 2020 CPA-Zicklin Index.

Proxy Access Bylaw

We proactively adopted proxy access bylaw provisions in 2017. These provisions permit a stockholder, or a group of up to 20 stockholders, owning at least 3% of our outstanding common stock, for at least three years, to include two director nominees, or 20% of the current Board, whichever is greater, in our proxy statement for the annual general meeting.

Policies and Procedures for Approval of Related Person Transactions

The Board has a written policy with respect to “related person transactions” to document procedures by which such transactions are reviewed, approved or ratified. Under SEC rules, “related persons” include any director, executive officer, director nominee, or greater than 5% stockholder of the Company since the beginning of the previous fiscal year, and their immediate family members. The policy applies to any transaction in which:

The Nominating and Governance Committee, with assistance from the Company’s Chief Legal Officer, is responsible for reviewing and, where appropriate, approving or ratifying any related person transaction involving Schlumberger or its subsidiaries and 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 Company and its stockholders.

Since the beginning of 2020, there were no related person transactions under the relevant standards.

Communication with Board

The Board recommends that stockholders and other interested parties initiate communications with the Board, the Chairman or any Board committee by writing to our Corporate Secretary. This process assists the Board in reviewing and responding to communications by stockholders and other interested parties. The Board has instructed our Corporate 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 he or she deems appropriate for the Board’s consideration. Communications can be sent to the following address:

Director Compensation in Fiscal Year 2020

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. Directors who are employees of Schlumberger do not receive compensation for serving on the Board.

Annual payments are made after our non-employee directors are elected by our stockholders. Non-employee directors who begin their Board, Board Chair, committee or committee chair service other than immediately following the annual general meeting of stockholders receive a prorated amount of annual compensation.

Director Pay Components

Non-employee directors receive an annual cash retainer of $115,000 plus an additional annual fee of $10,000 for each committee membership. The chair of each committee receives an additional annual fee of $20,000 in lieu of the fee for committee membership. Mr. Papa earns an additional $100,000 cash fee annually, reflecting his additional responsibilities as the Board’s independent Chairman.

In April 2020, in response to the COVID-19 pandemic and global economic downturn, all non-employee directors voluntarily agreed to forgo 100% of their cash compensation for the second quarter of 2020. The Compensation Committee made no other changes to our non-employee director compensation program in 2020.

Additionally, Schlumberger’s practice is to annually grant to each non-employee director shares of Schlumberger common stock valued at approximately $190,000, or $290,000 for the independent Chairman of the Board, each April after our annual general meeting. Although the Schlumberger 2004 Stock and Deferral Plan for Non-Employee Directors (the “Directors Stock Plan”) provides that annual stock awards to non-employee directors may be in the form of shares of common stock, shares of restricted stock or restricted stock units (“RSUs”), our practice has been to only issue shares of common stock. Our directors have never received restricted stock or RSUs as director compensation.

The following table provides information on the compensation paid to our non-employee directors in 2020.

Director Stock Ownership Guidelines

The Board believes that ownership of Schlumberger stock by Board members aligns their interests with the interests of our stockholders. Accordingly, the Board has established a guideline that each non-employee Board member must, within five years of joining the Board, own at least 10,000 shares of Schlumberger common stock. As of December 31, 2020, each of our non-employee director nominees who has been a Board member for at least five years was in compliance with these stock ownership guidelines.

Director Deferral Plan

Non-employee directors may elect to defer all or a portion of their annual stock or cash awards through 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) Schlumberger 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.

Stock Ownership Information

Security Ownership by Management and Our Board

The following table sets forth information known to us with respect to beneficial ownership of our common stock as of January 31, 2021 by (i) each director and director nominee, (ii) each of the named executive officers and (iii) all directors and executive officers as a group.

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 footnotes to the table below and subject to applicable community property laws, to our knowledge the persons named in the table below have sole voting and investment power with respect to the securities listed. None of the shares are subject to any pledge.

The number of shares beneficially owned by each person or group as of January 31, 2021 includes shares of common stock that such person or group has the right to acquire within 60 days of January 31, 2021, including upon the exercise of options to purchase common stock or the vesting of RSUs or PSUs. References to options in the footnotes to the table below include only options outstanding as of January 31, 2021 that are currently exercisable or that become exercisable within 60 days of January 31, 2021. The table below excludes the number of shares that have been earned under our 2018 ROCE PSUs but not yet finally determined, as described under “Compensation Discussion and Analysis—Payouts Under PSU Awards—2021 Payouts Under 2018 ROCE PSUs,” on page 43.

For each individual and group included in the table below, percentage ownership is calculated by dividing the number of shares beneficially owned by such person or group by the sum of the 1,398,264,586 shares of common stock outstanding on January 31, 2021, plus the number of shares of common stock that such person or group had the right to acquire on or within 60 days of January 31, 2021.

As of January 31, 2021, no director, director nominee or named executive officer owned more than 1% of the outstanding shares of Schlumberger’s common stock. All directors and executive officers as a group owned less than 1% of the outstanding shares of our common stock as of January 31, 2021.

Security Ownership by Certain Beneficial Owners

The following table sets forth information as of December 31, 2020 (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 1,398,264,586 shares of our common stock outstanding on January 31, 2021.

Delinquent Section 16(a) Reports

Section 16(a) of the Securities Exchange Act of 1934, as amended (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, 2020 or prior fiscal years. One Form 4 required to be filed in 2017 by Mr. Kevin Fyfe relating to a grant of RSUs was not timely filed, but was filed on October 20, 2020, and one Form 4 required to be filed in 2019 by Mr. Belani relating to tax withholding was not timely filed, but was filed on January 26, 2021.

We are asking our stockholders to approve, on an advisory basis, our executive compensation as reported in this proxy statement. As described below in the “Compensation Discussion and Analysis” section of this proxy statement, the Compensation Committee has structured our executive compensation program to achieve the following key objectives:

We urge stockholders to read the “Compensation Discussion and Analysis” beginning on page 28 of this proxy statement, which describes in more detail how our executive compensation policies and procedures operate and are designed to achieve our compensation objectives. We also urge stockholders to read the Summary Compensation Table and other related compensation tables and narrative, appearing on pages 52-65, which provide detailed information on the compensation of our named executive officers. The 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 named executive officers reported in this proxy statement has contributed to the Company’s long-term success.

In accordance with Section 14A of the Exchange Act, and as a matter of good corporate governance, we are asking stockholders to approve the following advisory resolution at the 2021 annual general meeting of stockholders:

RESOLVED, that the stockholders of Schlumberger Limited (the “Company”) approve, on an advisory basis, the compensation of the Company’s named executive officers disclosed in the Compensation Discussion and Analysis, the Summary Compensation Table and the related compensation tables, notes and narrative in the Proxy Statement for the Company’s 2021 annual general meeting of stockholders.

This advisory resolution, commonly referred to as a “say-on-pay” resolution, is non-binding on our Board. Although non-binding, our Board and the Compensation Committee will review and consider the voting results when making future decisions regarding our executive compensation program.

The Board has adopted a policy providing for an annual “say-on-pay” advisory vote. Unless the Board modifies its policy on the frequency of holding “say-on-pay” advisory votes, the next “say-on-pay” advisory vote will occur in 2022.

Required Vote

A majority of the votes cast is required to approve this Item 2.

Brokers do not have discretion to vote on this proposal without your instruction. If you do not instruct your broker how to vote on this proposal, your broker will deliver a non-vote on this proposal.

The Board of Directors Recommends a Vote FOR Item 2.

Compensation Discussion and Analysis

This Compensation Discussion and Analysis (“CD&A”) describes our compensation policies and practices as they relate to our six named executive officers (“NEOs”) listed below:

The purpose of the CD&A is to explain the elements of our NEOs’ 2020 compensation; the criteria for selecting these elements; the relative size of each compensation element; the decisions our Compensation Committee made with respect to the 2020 compensation of our NEOs; and the reasons for those decisions.

2020 — Executive Overview

The unprecedented global health and economic crisis caused by the COVID-19 pandemic in 2020 resulted in the most challenging environment that we and our industry have ever experienced. For the first time ever, West Texas Intermediate crude oil briefly traded below $0, one of the many devastating effects of COVID-19. The profound global economic shock caused by the pandemic resulted in both a swift collapse in oil demand and in oversupply, which together caused a dramatic decline in demand for our services and products.

Against this historic backdrop, we took swift and decisive actions to execute on our performance strategy, cut operating costs, and reinvent ourselves to adapt to an evolving industry landscape shaped by capital discipline, increased efficiency, operational resilience through industry cycles, sustainability and a reduced carbon footprint.

Highlights of our 2020 financial, strategic and operational performance include:

Highlights of our 2020 sustainability performance include:

As a result of our actions in 2020, we increased our earnings power and improved our margin profile, which position us to capitalize on growth drivers for the future of our industry and the next recovery cycle. We enter 2021 with positive momentum and a clear path to achieving double-digit margins in North America and further improving international margins in 2021. We believe that, given the depth, diversity and executional capability of our international business, we are uniquely positioned to benefit as international spending accelerates in the near- and midterm.

We came through the turbulence of 2020 with drive and purpose and reinvented ourselves for the future. We believe that we are poised to deliver superior results for our shareholders, informed by our vision of a more efficient, sustainable industry.

Overview of Compensation Decisions for 2020

The 2020 compensation of our named executive officers appropriately reflects and rewards their strong contributions to the Company’s performance as they successfully navigated, and responded to, unprecedented challenges to our industry. Our Compensation Committee also continued to focus on strengthening the link between pay and performance; appropriately compensating our executives for effectively deploying capital and generating cash flow; motivating our top executives through a year of tremendous worldwide economic volatility and uncertainty; and promoting long-term stockholder value despite challenging industry conditions.

In this context, and as more fully discussed elsewhere in this CD&A, below are some key actions that our Compensation Committee took with respect to our NEOs’ 2020 compensation:

For reconciliations of cash flow generated and adjusted EBITDA to their most comparable GAAP measures, see Appendix A.

 

Some Key Facts About Our 2020 Executive Compensation

 

	We made no changes to the performance goals in our 2020 LTI program despite the pandemic
	100% of our named executive officers’ 2020 LTI compensation was performance-based
	All of our current executive officers agreed to a 20% temporary reduction in their base salaries during the second quarter of 2020, in response to the COVID-19 pandemic and the global economic downturn

	100% of our NEOs’ outstanding stock options were “under water” as of January 31, 2021 (see page 64)
	Our CEO and CFO’s 2020 target direct compensation places them at approximately the 50th percentile among CEOs and CFOs, respectively, in our main peer groups
	Our CEO and certain other NEOs’ 2020 key personal objectives included sustainability and/or gender balance targets (see pages 38-39)

 

Changes to Our 2021 Long-Term Incentive Program

In response to stockholder feedback and based on a review of peer company practices, our Compensation Committee in January 2021 approved several changes to our LTI program for 2021 executive compensation, as described in the chart below. The full impact of these changes will be reflected in our 2021 executive compensation program, and will be presented more fully in our proxy statement for our 2022 annual general meeting.

Framework for Setting Executive Compensation in 2020

Program Design and Pay-for-Performance Philosophy

Our 2020 executive compensation program consisted of three primary elements, comprising our executives’ total direct compensation: base salary, annual cash incentive awards, and LTI equity awards. These elements have allowed us to remain competitive and attract, retain and motivate top executive talent.

The table below sets out the primary elements of our NEOs’ 2020 total direct compensation, certain key features of each element, how we determined their respective amounts, and how each of these compensation elements supports our strategy.

TYPE			ELEMENT		KEY FEATURES		HOW WE DETERMINE		HOW ELEMENT SUPPORTS OUR STRATEGY
			Return on Capital Employed (ROCE) Performance Share Units		•  Relative performance metric, which compares our average annual ROCE to that of major oilfield service competitors over a 3-year performance period   •  Relative TSR modifier may reduce, but not increase, PSU payouts to executives		•  See ROCE payout and performance matrix on page 41   •  See also “TSR Modifier” on page 40		•  Measures the efficiency of our capital employed relative to key competitors, consistent with our strategic priorities in a capital-constrained environment   •  Motivates and rewards executives for relative outperformance on a key financial metric   •  TSR modifier reduces payouts if we underperform relative to the companies comprising the OSX Index
			Free Cash Flow (FCF) Conversion Performance Share Units		•  Absolute performance metric   •  Based on the percentage of our cumulative net income, excluding charges and credits, that we are able to convert into free cash flow, over a 2-year performance period   •  Three-year relative TSR modifier may reduce, but not increase, PSU payouts to executives		•  See free cash flow conversion payout and performance chart on page 42   •  See also “TSR Modifier” on page 40		•  Aligns the interests of our executives with long-term stockholder value by tying payouts to our profitability and ability to convert cumulative net income into free cash flow   •  TSR modifier enhances stockholder alignment by extending the vesting period to three years. Also reduces payouts if we underperform relative to the companies comprising the OSX Index
			Annual Cash Incentive Award		•  70% based on achievement of quantitative, absolute dollar value Company financial goals:   •  40% based on cash flow generation targets   •  30% based on adjusted EBITDA targets   •  30% based on achievement of pre-established key personal objectives, aligned with our 2020 strategic priorities		•  See cash flow generation payout and performance chart on page 37   •  See adjusted EBITDA payout and performance chart on page 37   •  See each NEO’s objectives on pages 38-39		•  Fosters a results-driven, pay-for-performance culture   •  Our cash flow generation goal aligns our capital stewardship priority with stockholder interests by tying executive payouts directly to the generation of cash necessary to fund our dividend, invest in future growth areas, and execute on other strategic initiatives   •  Adjusted EBITDA reflects quality Company earnings driven by operational performance
			Base Salary		•  Only fixed compensation component   •  Reviewed annually in January, and adjusted when appropriate		•  Job scope and responsibilities; experience; market data; individual performance		•  Provides a base level of competitive cash compensation when all other pay elements are variable

In setting our executives’ compensation, we believe that:

Performance-Weighted Pay Mix

Our executive compensation program is designed so that the higher an executive’s position in the Company, the greater the percentage of his or her compensation that is “at risk” — that is, contingent on our financial performance and his or her individual performance. We believe that having a significant portion of our executives’ compensation at risk more closely aligns their interests with our long-term interests and those of our stockholders.

As shown in the charts below, approximately 90% of our CEO’s 2020 target total direct compensation was at risk, and approximately 83% of our other NEOs’ 2020 target total direct compensation was at risk.

CEO 2020 Target Pay Mix(1)		Other NEO 2020 Target Pay Mix(2)

Our Compensation Committee seeks to achieve an appropriate balance between LTI awards, which emphasize long-term shareholder value creation and which encourage effective deployment of capital and conversion of net income to free cash flow, and annual cash rewards, which encourage achievement of annual 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 generally aligned with that of the companies in our two main executive compensation peer groups. For additional details about our comparative pay-for-performance assessments against our peer companies, see “Other Aspects of Our Executive Compensation Framework—Pay-for-Performance Relative to Our Peers” beginning on page 44 below.

In January 2020, our Compensation Committee concluded that, based on its review of 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.

Our Compensation Committee also reviewed internal pay equity at its October 2020 meeting. Because our executive officers operate as a team, our Compensation Committee considers internal pay equity to be an important factor in its executive compensation decisions. Our Compensation Committee noted that the ratio of target total direct compensation between the CEO and the second-highest paid executive officer was largely in line with prior years. Our Compensation Committee also noted that the levels of target total direct compensation for the third- to the fifth-highest paid officers were appropriately clustered together, consistent with their relative positions within the Company. As a result, our Compensation Committee concluded that internal pay equity was appropriate.

Stockholder Engagement; 2020 Say-On-Pay Vote

Our Compensation Committee is committed to seeking and considering stockholder feedback in designing and managing our executive compensation program. We proactively engage with our stockholders regarding executive compensation and other corporate governance matters throughout the year, as discussed further in “Corporate Governance—Stockholder Engagement” on page 16. Our compensation program design for 2020 was largely developed and implemented in response to, and as a product of, past discussions with our stockholders. For example, in response to stockholder feedback, in recent years we reduced the weighting of our NEOs’ key personal objectives under our annual cash incentive plan, correspondingly increased the weighting of quantitative Company financial goals under that plan, and incorporated a three-year relative TSR modifier into our PSU awards. Also in response to stockholder feedback, all PSUs issued to our executives in 2021 are subject to three-year performance periods.

In 2020, 87.6% of the votes cast at our annual general meeting of stockholders voted in favor of our executive compensation program. Prior to our 2020 annual meeting, we reached out to 31 of our largest stockholders, representing 53% of our outstanding common stock, and met with 17 of them, representing 34% of our outstanding common stock, to seek their views on our executive compensation program. Our management team then reported on these discussions to our Compensation Committee and our Board as appropriate.

Elements of Total Direct Compensation; 2020 Decisions

Base Salary

Base salary is the fixed portion of an executive’s annual compensation, which provides some stability of income since the other compensation elements are at risk. On appointment to an executive officer position, base salary is set at a level that is competitive with base salaries in the applicable peer compensation groups for that position, and takes into account other factors described below.

Base salaries for each executive officer are compared annually with similar positions in the applicable compensation peer groups. Base salary changes for executive officers, except the CEO, are recommended by the CEO and subject to approval by our Compensation Committee, taking into account:

Our Compensation Committee reviews the base salary of the CEO in executive session and recommends his base salary to the non-executive members of our Board for approval, based on the criteria described above. In addition to periodic reviews based on the factors described above, our Compensation Committee may adjust an executive officer’s base salary during the year if he or she is promoted or if there is a significant change in his or her responsibilities. In this situation, the CEO (in the case of executive officers other than himself) and our Compensation Committee carefully consider these new responsibilities, external pay practices, retention considerations and internal pay equity, as well as past performance and experience. Alternatively, an executive’s base salary can be frozen for a number of years until it falls in line with comparable positions in the applicable compensation peer groups.

Base Salary Decisions in 2020

Our Compensation Committee reviewed the compensation of each of our NEOs in January 2020. Upon review of comparative market data (including data of the oil industry peer group, which showed lower base compensation growth) and other relevant factors, our Compensation Committee determined to maintain the base salaries of each of our NEOs, except:

In April 2020, in response to the COVID-19 pandemic and the global economic downturn, all of our current executive officers agreed to a 20% temporary reduction in their base salaries during the second quarter of 2020. These reductions affected all of our NEOs except Mr. Ayat, who was not serving as an executive officer at that time.

Annual Cash Incentive Awards

We pay annual performance-based cash incentives to our executives to foster a results-driven, pay-for-performance culture and to align their interests with those of our stockholders. Annual cash incentive awards are earned according to the achievement of financial, strategic, operational and personal objectives, as described below. Our Compensation Committee reviews and approves the financial and other objectives applicable to our NEOs (and, in the case of our CEO, recommends to the non-executive directors of the Board the objectives applicable to the CEO).

For 2020 compensation, 70% of our NEOs’ annual cash incentive opportunity was based on achievement of quantitative Company financial goals—cash flow generation (40%) and adjusted EBITDA (30%)—with the remaining 30% being based achievement of pre-established key personal objectives, as reflected in the following chart:

Our Compensation Committee selects performance-based measures that it believes strike a balance between motivating an executive to increase near-term operating and financial results and driving profitable long-term Company growth and value for stockholders. The Committee believes that, with regard to Company financial targets or performance goals, as well as our NEOs’ key personal objectives, it is important to establish criteria that are realistic, while still being challenging to achieve in an uncertain global economy.

In establishing cash flow generation goals for our executives’ 2020 cash incentive plan, the Compensation Committee considered that these goals differ substantially from the free cash flow conversion goals contained in the LTI portion of our NEOs’ compensation program. This is because the annual cash incentive portion focuses solely on the absolute amount of cash we generate over a one-year period, and takes into account 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 conversion metric contained in our LTI awards). Our free cash flow conversion PSU payout is based on the percentage of cumulative net income, excluding charges and credits, converted into free cash flow over a two-year period. Because this metric measures how much of our earnings we are able to convert into cash, it is a good indicator of the quality of our earnings and, therefore, is a complementary metric to cash flow generated.

Financial Objectives

The 70% quantitative financial component of our NEOs’ 2020 annual cash incentive opportunity comprised two different metrics, with 40% being based on achievement of cash flow generation targets and 30% on achievement of adjusted EBITDA targets. Our Compensation Committee selected cash flow generation and adjusted EBITDA as the two financial metrics for our 2020 cash incentive plan for the reasons detailed in the chart on the following page. In addition, the Committee selected these two metrics as the absolute measures upon which to base the financial portion of our NEOs’ annual cash incentive opportunity because they are key metrics on which we set our performance expectations for the year, and because the Committee believes that consistent cash flow generation and adjusted EBITDA growth lead to long-term stockholder value.

As previously disclosed in July 2020, our Compensation Committee approved certain modifications to our 2020 cash incentive plan in response to the effects of the COVID-19 pandemic and other factors that severely and negatively affected our industry, including the precipitous collapse in global oil demand and the resulting decline in demand for our services and products. Put simply, our Compensation Committee determined that the range of Company financial results possible as a result of the pandemic and its effects had changed so dramatically that it was necessary to reassess the 2020 financial performance metrics and targets under our 2020 cash incentive plan that the Committee had approved earlier in the year. Our Compensation Committee believes the changes that it approved, which are described in the chart on the next page, align our executives’ performance and the Company’s strategy with aggressive performance goals and metrics to better drive stockholder value.

Key Personal Objectives

Early each fiscal year, our Compensation Committee reviews and approves the key personal objectives of the CEO for that year, subject to approval by the non-executive members of the Board. The Committee also annually assesses the CEO’s performance against his key personal objectives established for the prior year, to determine a 30% portion of his annual cash incentive opportunity. The CEO reviews and approves the key personal objectives of the other NEOs, and assesses their performance against their pre-approved objectives in a similar way.

Each NEO’s annual cash incentive opportunity is tied to achievement of quantitative and qualitative goals that are specific to that NEO’s position, and may relate to:

2020 Annual Cash Incentive Results

Upon review of market data, and taking into consideration internal pay equity and that the target annual cash incentive opportunity of our NEOs was already competitively positioned from a market perspective, our Compensation Committee determined in January 2020 to leave the target annual cash incentive opportunity for all NEOs unchanged from 2019, except with respect to Mr. Biguet. The Committee had previously approved, in December 2019, an increase to Mr. Biguet’s target annual cash incentive opportunity from 75% to 100% in connection with his promotion in January 2020 to the role of EVP and CFO. As a result, the 2020 target annual cash incentive for our CEO was 150% of his base salary and 100% of base salary for our other NEOs.

The following chart reflects our NEOs’ full-year 2020 annual cash incentive results, together with relevant weightings of the different components and payouts under each component.

In reviewing our 2020 annual cash incentive results, our Compensation Committee considered the significant efforts of our executive team in delivering strong cash generation and adjusted EBITDA results in a year of unprecedented challenges. In addition, the Committee considered that our stock price increased by more than 34% between the date on which the Committee approved full-year 2020 adjusted EBITDA targets (July 16, 2020) and the date on which the Committee approved 2020 annual cash incentive payouts (January 21, 2021), demonstrating alignment between the Company’s significant above-target adjusted EBITDA performance and stockholder returns. In light of the foregoing considerations, the Committee determined that no downward adjustments to the payouts would be made. Accordingly, our Compensation Committee approved the annual cash incentive payouts for each of our named executive officers as set forth above.

2020 Cash Flow Generation Targets and Results

The process used to set annual cash flow generation targets starts with a review of plans and projections following bottom-up planning from the field. 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, and commodity prices.

The following chart reflects our NEOs’ full-year 2020 cash flow generation targets, as approved by our Compensation Committee in July 2020, together with comparisons to the 2019 cash flow generation targets.

For cash flow generation results between any two targets, payout is prorated. No cash incentive is earned if we do not achieve the minimum cash flow generation target.

Our 2020 cash flow generated was $2.67 billion. Based on these results, and applying the payout matrix above, our Compensation Committee approved a payout of 94% of target for the cash flow generation component of our NEOs’ annual cash incentive opportunity.

As discussed above under “—Financial Objectives,” our Compensation Committee did not modify the target and maximum performance goals for the cash flow generation portion of our annual cash incentive opportunity. The minimum performance goal that the Committee originally approved in January 2020 was $2.52 billion, and would have resulted in a payout of 74% of target had the goal not been adjusted in July 2020.

In approving cash flow generation as a performance metric, our Compensation Committee believed that it should encourage management to pursue its strategy of divesting certain non-core or low-margin businesses and assets while at the same time holding management accountable for investment and acquisition opportunities that it chose to pursue. The Committee also 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 from our cash flow generation goals. 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 2020 annual cash incentive payouts, the Committee approved the following formulation for measuring our cash flow generation:

For a reconciliation of cash flow generation to cash flow from operations, see Appendix A.

2020 Adjusted EBITDA Targets and Results

As discussed above under “—Financial Objectives,” in July 2020 our Compensation Committee modified the Company’s 2020 cash incentive plan by replacing the previously-approved adjusted EPS performance metric with a 2020 adjusted EBITDA performance metric. The Committee approved a minimum performance goal informed by EBITDA consensus and a target performance goal set 12% above EBITDA consensus based on our then-current internal forecast. The Committee believed that setting the target performance goal above EBITDA consensus would incentivize our executives to outperform market expectations.

The following chart reflects our NEOs’ full-year 2020 adjusted EBITDA targets.

For adjusted EBITDA results between any two targets, payout is prorated. No cash incentive is earned if we do not achieve the minimum adjusted EBITDA target.

Schlumberger’s 2020 adjusted EBITDA was $4.31 billion, while 2020 loss before taxes on a GAAP basis was $11.298 billion. For a reconciliation of adjusted EBITDA to loss before taxes on a GAAP basis, see Appendix A. Based on these adjusted EBITDA results, our Compensation Committee approved a payout of 162% of target for the adjusted EBITDA component of our NEOs’ annual cash incentive opportunity. Had our Compensation Committee not replaced the adjusted EPS performance goals with adjusted performance EBITDA goals, our NEOs would have earned no payout under the adjusted EPS component of their 2020 cash incentive opportunity.

Our Compensation Committee evaluated our performance based on adjusted EBITDA consistent with the manner in which we presented our adjusted EBITDA results in our third- and fourth-quarter 2020 earnings announcements and in presentations to investors. It is also consistent with how analysts calculate their estimates. In approving the payout for 2020 adjusted EBITDA performance, the Committee reaffirmed its decision to exclude the charges and credits set forth in Appendix A from the calculation of adjusted EBITDA, on the grounds that a significant portion of the charges were non-cash in nature, and were also driven primarily by external market conditions and outside of management’s control.

2020 Key Personal Objectives and Results

Long-Term Equity Incentive Awards

LTI awards are designed to give NEOs and other high-value employees a long-term stake in the Company, incentivize the creation of sustained stockholder value, act as long-term retention and motivation tools, and directly tie employee and stockholder interests over the long term. In January 2020, our NEOs and other executives received 100% of their LTI awards in the form of PSUs, with payouts contingent on achievement of both absolute and relative Company financial performance goals.

Our Compensation Committee believes that our current LTI program serves the following objectives:

No shares will vest under the PSUs awarded to our NEOs if we do not achieve pre-established minimum performance levels. No dividends will accrue or be paid on any unvested PSUs during the applicable performance periods.

In January 2020, our NEOs earned 141% of the target shares of our common stock upon vesting of the three-year PSUs that were granted to our NEOs in 2017, and 250% of the target shares of our common stock upon vesting of the two-year PSUs that were granted in 2018. In January 2021, our NEOs earned 134% of the target shares of our common stock upon vesting of the three-year PSUs that were granted to our NEOs in 2018. See “—Payouts Under PSU Awards” on page 43.

How We Determined the Value of 2020 LTI Equity Awards

The value of an executive’s LTI grant increases with the level of an executive’s responsibility at the Company. For the CEO and our other NEOs, it is the largest element of their compensation. In determining the value of LTI awards granted to NEOs, our Compensation Committee (in recommending approval by the Board of 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 executive compensation peer groups, as well as several other factors, which may include:

LTI Grants to Our NEOs in 2020

Based on its review of comparator peer group data and the market environment, our Compensation Committee determined in January 2020 to maintain the 2020 target LTI grant values at the same level awarded in 2019 for all our NEOs, except that Mr. Biguet’s target LTI grant value was increased in connection with his promotion to EVP and CFO. In addition, our CEO was not granted a 2020 LTI award in light of his August 2019 PSU Awards, as discussed above under “—Overview of Compensation Decisions for 2020.”

Our Compensation Committee approved:

A three-year relative TSR modifier applies to all PSUs granted in 2020. As a result, all PSUs granted in 2020 will vest, if at all, only after a three-year TSR performance period.

The following table details the target number of ROCE PSUs and FCF Conversion PSUs granted to our NEOs in 2020 and the estimated target values of our NEOs’ 2020 and 2019 annual LTI awards, as well as the year-over-year percentage change between the two amounts.

TSR Modifier

We will determine the effect of the TSR modifier on the 2020 PSUs in early 2023. First, we will calculate the three-year, cumulative TSR results for each company that was included in the Philadelphia Oil Services Sector index (the “OSX Index”) as of January 2020. Then, we will rank Schlumberger’s three-year, cumulative TSR against each of those peer companies. Our TSR modifier does not use, and is not affected by, the OSX Index’s internal weighting methodology. If our three-year, cumulative TSR is in the bottom 33^rd percentile rank as compared to each of those companies’ individual TSR results, then our TSR modifier will cause the payouts on the 2020 PSUs to be reduced by 25 percentage points (e.g. from 100% of target to 75% of target). This modifier will only reduce the number of shares earned under a PSU award, but will never increase the number of shares earned.

2020 ROCE PSUs: Performance Measures and Goals

In January 2020, our Compensation Committee set goals for the 2020 ROCE PSUs based on our average annual ROCE over a three-year performance period as compared to the average annual ROCE of the following oilfield services competitors, taken together over the same period: Halliburton, Baker Hughes, TechnipFMC, Weatherford International and NOV Inc. (formerly National Oilwell Varco) (collectively, the “ROCE comparator group”).

The ROCE performance period for the 2020 ROCE PSUs began on January 1, 2020 and ends on December 31, 2022. These PSUs are also subject to a three-year TSR performance period under the relative TSR modifier, over the same period.

Vesting of these PSUs will depend on our performance compared to the average ROCE of the ROCE comparator group. The number of PSUs that will vest and convert to shares as of the vesting date can range from 0% to 250%, but in no event will payout exceed 250%. As illustrated in the graph below:

At the end of the ROCE and TSR performance periods, our Compensation Committee will certify our average ROCE and that of the ROCE comparator group as a whole. The Committee will then determine the percentage of shares earned based on the graph below, as adjusted for the three-year relative TSR modifier.

2020 ROCE PSU Payout Matrix

ROCE is a measure of the efficiency of our capital employed and is a comprehensive indicator of long-term Company and management performance. We selected a relative ROCE metric because it allows us to directly compare how we deploy our capital against key comparator companies in oilfield services. Furthermore, ROCE measures performance in a way that is tracked and understood by many of our investors. This is also the metric that our Compensation Committee approved for the PSUs issued to our NEOs in 2019.

Our selection of ROCE as a performance metric for our 2020 PSUs is also consistent with our strategic priorities. Our Compensation Committee believes that tying a part of our executives’ LTI pay to achieving our capital efficiency goals and comparing these results to that of our key oilfield services competitors will motivate our executives to continue to innovate. Our Compensation Committee also believes that improvements in efficiency through innovation will increase revenue and improve margins through our continued focus on pricing and cost control.

We calculate ROCE as a ratio, the numerator of which is (a) 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 may adjust the Company’s income from continuing operations to take into account the effect of significant impacts or activities that are not representative of underlying business operations, such as acquisitions, divestitures, asset impairments and restructurings.

2020 FCF Conversion PSUs: Performance Measures and Goals

In January 2020, our Compensation Committee set goals for the 2020 FCF Conversion PSUs based on the percentage of our cumulative net income, excluding charges and credits, that we are able to convert to free cash flow over a two-year performance period. Our Compensation Committee set the 2020 target free cash flow conversion goal at 95%, a 36% increase from the 2019 goal, and also increased the 2020 minimum and maximum goals as compared to 2019. The Committee also lowered by 50% the payout that our NEOs would receive upon achievement of 100% free cash flow conversion.

The free cash flow conversion performance period for these PSUs began on January 1, 2020 and ends on December 31, 2021. The Committee believed it was appropriate to set two-year free cash flow conversion performance goals due to the difficulty in setting meaningful cash flow performance targets over longer time periods in our cyclical industry. These PSUs are also subject to a three-year TSR performance period under the relative TSR modifier, from January 1, 2020 to December 31, 2022.

Vesting of the 2020 FCF Conversion PSUs requires us to convert at least 75% of our cumulative net income to free cash flow over the two-year performance period. As illustrated in the table above, no shares of our common stock will be earned if our free cash flow conversion percentage is less than or equal to 75%. The number of PSUs that will convert to shares at the end of the three-year TSR performance period can range from 0% to 250%, but in no event will payout exceed 250%. At the end of the TSR performance period, our Compensation Committee will certify the cumulative free cash flow and net income generated by the Company over the two-year free cash flow conversion performance period, and then determine the number of shares earned based on the table above, as adjusted for the three-year relative TSR modifier.

Free cash flow is an important liquidity measure for the Company and is useful to investors and to management as a measure of the Company’s profitability and ability to generate cash. Selecting as a performance metric the percentage of cumulative net income converted to free cash flow for these PSUs is also part of our goal to better align executive compensation with stockholder returns and encourage our executives to maintain capital discipline through business cycles. Once business needs and obligations are met, this cash can be used to reinvest in the Company for future growth or to return to stockholders through dividend payments or share repurchases. Our Compensation Committee believes that tying a part of our NEO’s LTI payout to our efficiency in converting cumulative net income to free cash flow incentivizes our executives to increase the liquidity of the Company.

For purposes of the 2020 FCF Conversion PSUs, net income is defined as income from continuing operations before non-controlling interests, excluding charges and credits; and free cash flow represents cash flow from operations, less capital expenditures, investments in APS projects, and multiclient seismic data costs capitalized. See Appendix A for a description of the charges and credits that are excluded from net income. The terms of these PSUs allow for cash payments made in the acquisition of baseline production and investments up to first production for APS projects to be excluded from the calculation of free cash flow. The purpose of these exclusions was to avoid creating a potential disincentive to appropriately invest in the APS business. However, in 2019, as part of our change in corporate strategy, we announced that we would not take equity positions in oil and gas assets or use cash to pay upfront costs of new projects. As a result, we do not anticipate any such exclusions to our free cash flow under our 2020 FCF Conversion PSUs.

Our Compensation Committee has the discretion to adjust the Company’s income from continuing operations before noncontrolling interests to take into account the effect of significant impacts or activities that are not representative of underlying business operations, such as acquisitions, divestitures, asset impairments and restructurings.

Payouts Under PSU Awards

2020 Payouts Under 2017 ROCE PSUs

In January 2017, our Compensation Committee granted PSUs to our NEOs and conditioned payout based on our average annual ROCE achieved over a three-year performance period as compared to the average annual ROCE of the ROCE comparator companies (the “2017 ROCE PSUs”).

In January 2020, our Compensation Committee approved the results for the 2017 ROCE PSUs using the performance criteria that the Committee had previously approved. Specifically, our Compensation Committee determined that, based on the then-available reported results of the ROCE comparator companies, the 2017 ROCE PSUs had been earned at 141% of target, based on Schlumberger’s annual average ROCE of 200 basis points above the average of the ROCE comparator group through September 30, 2019, which was at the time the most recent fiscal period end reported by all of the companies comprising the ROCE comparator group. Because not all ROCE comparator companies had reported their audited 2019 results as of January 2020, our Compensation Committee approved a preliminary issuance of 90% of the shares earned under the 2017 ROCE PSUs. In April 2020, once all ROCE comparator companies had released their 2019 audited financial results, the Company issued the number of additional shares determined to have been earned based on achievement of 141% of target.

2020 Payouts Under 2018 FCF Conversion PSUs

In January 2018, our Compensation Committee granted PSUs to our NEOs and conditioned payout based on the cumulative free cash flow generated from January 1, 2018 to December 31, 2019, as a percentage of cumulative net income generated over that same period, excluding charges and credits (the “2018 FCF Conversion PSUs”).

In January 2020, our Compensation Committee determined that we achieved cumulative free cash flow conversion of 129% for the two-year performance period, representing achievement of 250% of target, based on the Committee’s previously-approved performance criteria. As a result, our NEOs earned 250% of target under the 2018 FCF Conversion PSUs. These shares were subject to a mandatory one-year hold period, and converted to non-restricted shares in January 2021.

2021 Payouts Under 2018 ROCE PSUs

In January 2018, our Compensation Committee granted PSUs to our NEOs and conditioned payout based on our average annual ROCE achieved over a three-year performance period as compared to the average annual ROCE of the ROCE comparator companies (the “2018 ROCE PSUs”).

In January 2021, our Compensation Committee approved the results for the 2018 ROCE PSUs using the performance criteria that the Committee had previously approved. Specifically, our Compensation Committee determined that, based on the then-available reported results of the ROCE comparator companies, the 2018 ROCE PSUs had been earned at 134% of target, based on Schlumberger’s annual average ROCE of 173 basis points above the average of the ROCE comparator group through September 30, 2020, which was at the time the most recent fiscal period end reported by all of the companies comprising the ROCE comparator group. Because not all ROCE comparator companies had reported their audited 2020 results as of January 2021, our Compensation Committee approved a preliminary issuance of 90% of the shares earned under the 2018 ROCE PSUs. Any additional shares finally determined to have been earned will be issued after all of the ROCE comparator companies disclose their full-year 2020 audited results.

Unvested 2019 FCF Conversion PSUs

In January 2019, our Compensation Committee granted PSUs to our NEOs and conditioned payout based on the cumulative free cash flow generated from January 1, 2019 to December 31, 2020, as a percentage of cumulative net income generated over that same period, excluding charges and credits (the “2019 FCF Conversion PSUs”). These PSUs remain subject to a three-year TSR performance period ending December 31, 2021, and as such remain unvested. At the end of the TSR performance period, our Compensation Committee will determine the number of shares ultimately earned under the 2019 FCF Conversion PSUs.

Other Aspects of Our Executive Compensation Framework

Best Practices in Executive Compensation Governance

The following is a summary of some of our executive compensation best practices and policies.

Pay-for-Performance Relative to Our Peers

As part of our Compensation Committee’s annual review of our executive compensation program, in July 2020 the Committee directed Pay Governance to prepare a comparative pay-for-performance assessment against two sets of peer group companies:

The purpose of the comparative assessment was to determine the degree of alignment between our NEOs’ realizable total direct compensation and our performance relative to these peer companies as measured by return on capital, free cash flow growth and TSR. We selected these metrics for their effectiveness in assessing long-term Company performance, and because our PSU awards incorporate them as key performance metrics or modifiers. Return on capital and free cash flow growth are key inputs to shareholder value, and TSR is a primary output measure of shareholder value creation.

We assessed performance on a three- and five-year basis ending on December 31, 2019, because our Compensation Committee believes that alignment of pay and performance is more effectively assessed over the mid- and long-term. Our Compensation Committee reviewed the realizable total direct compensation of our CEO against that of other CEOs in our core competitor peer group and in our oil industry peer group. It then separately reviewed the realizable total direct compensation of our NEOs as a group against that of named executive officers at other companies comprising these two peer groups.

As a result of the assessment, the Committee determined that the realizable total direct compensation of our CEO and the other NEOs was generally aligned with performance relative to our core competitor peer group. Relative to our oil industry peer group, the Committee determined that the realizable total direct compensation of our CEO and the other NEOs was strongly aligned with return on capital performance over the five-year period. It was less aligned with free cash flow growth over the three- and five-year period and return on capital performance over the three-year period. It was also less aligned with TSR, due to the Company’s share price performance over the two periods relative to several of the integrated and E&P companies in our oil industry peer group, because upstream and integrated E&P companies generally outperformed oilfield services companies during those periods.

“Realizable total direct compensation” for each period consisted of the following:

Our Peer Group Companies

Our Compensation Committee considers formal executive compensation survey data prepared by Pay Governance when it reviews and determines executive compensation. The Committee also reviews information on the executive compensation practices at various peer group companies when considering changes to the Company’s executive compensation program. In addition, the relative performance metrics incorporated in our 2020 PSU awards are based on oilfield services industry-specific peer groups.

Our 2020 executive compensation program used several distinct peer groups, as summarized in the table below.

As shown in the table on the previous page, we have two main executive compensation peer groups: our oil industry peer group and our general industry peer group (our “main executive compensation peer groups”). Our Compensation Committee’s selection criteria for companies comprising the main executive compensation peer groups include:

Our Compensation Committee, with the assistance of Pay Governance, annually reviews specific criteria and recommendations regarding companies to add to or remove from these peer groups. As a general matter, our Compensation Committee selects suitable comparator companies such that companies in each of our two main executive compensation peer groups, at the median, approximate Schlumberger’s estimated revenue in the then-current year and its then-current market capitalization. Our Compensation Committee modifies the peer group criteria as appropriate while seeking a satisfactory degree of stability, to provide a consistent basis for comparison.

In July 2019, our Compensation Committee reviewed and approved the companies constituting our two main executive compensation peer groups effective for 2020 executive compensation decisions, based on the criteria set forth in this section. At the time of the Committee’s review, Schlumberger’s full-year 2019 revenue was forecast to be approximately $33.8 billion. The companies comprising the oil industry peer group and the general industry peer group effective for relevant 2020 compensation decisions are set forth below.

Oil Industry Peer Group

The oil industry peer group comprises oil services companies with annual revenues greater than $8.4 billion, as well as upstream E&P companies and integrated oil and gas companies with annual revenues between $10.4 billion and $158.9 billion. The broad revenue range is due to the limited number of peer companies in Schlumberger’s immediate revenue range, and the fact that all other oilfield service companies have lower revenue than Schlumberger. Some members of this peer group frequently seek to recruit Schlumberger executives for their senior executive roles. See “—The Competition for Our Executive Talent” beginning on page 47.

Our Compensation Committee decided to include E&P companies in this peer group based on a number of factors. First, because Schlumberger was significantly larger than all of its direct competitors in the oilfield services industry in terms of revenue and market capitalization, our Compensation Committee believed that the addition of E&P companies provided a more appropriate and complete comparator group. In addition, our Compensation Committee believed that the inclusion of E&P companies is appropriate because our executives have been hired by E&P companies in the past, and market consolidation has reduced the number of direct competitors in the oilfield services industry, thus increasing the prominence of E&P companies as competitors for our executive talent.

In July 2019, our Compensation Committee, applying the selection criteria set forth above, approved the removal of Petrofac from the oil industry peer group because it did not meet the revenue criterion described above. As a result of the foregoing, Schlumberger was in the 60^th percentile of the oil industry peer group in terms of revenue, and in the 78^th percentile of the oil industry peer group in terms of market capitalization.

General Industry Peer Group

The general industry peer group provides data from large companies with significant international operations, and supplements the compensation data from the oil industry peer group, whose companies are closer to Schlumberger in industry type but have widely varying revenue sizes. The general industry peer group:

Our Compensation Committee considers data from the general industry peer group as it deems necessary or advisable to the extent that data from the oil industry peer group may not exist, or may be insufficient, for some executive officer positions. The general industry peer group is also particularly relevant for non-operations positions, where the skills and experience may be easily transferable to other industries outside the oil and gas industry.

In July 2019, our Compensation Committee, applying the selection criteria set forth above, approved the removal of DowDupont from this peer group, because its annual revenue exceeded the criterion described above, as well as the addition of Accenture to this peer group. As a result of the foregoing, Schlumberger was positioned at the 53^rd percentile of the general industry peer group in terms of revenue, and the 56^th percentile of that peer group in terms of market capitalization.

The Competition for Our Executive Talent

A primary consideration of our Compensation Committee in overseeing our executive compensation program is the need to motivate and retain what it considers to be the best executive talent in the energy industry. We are the world’s largest oilfield products and services company. Our Compensation Committee believes that delivering strong long-term stockholder returns and financial and operational results 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, our Compensation Committee generally seeks to target total direct compensation for our NEOs between the 50^th and 75^th percentiles of our two main executive compensation peer groups; however, the Committee may position an NEO who is new to a position at or below the 50^th percentile for a period of time. For example, our CEO and CFO’s 2020 target direct compensation places them at approximately the 50^th percentile among CEOs and CFOs, respectively, in our main executive compensation peer groups. 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.

Our Compensation Committee believes that the 50^th to 75^th percentile range is appropriate to target because of Schlumberger’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, not only by our direct oilfield service competitors but by other leading oil and gas and technology- and engineering-focused companies.

In approving this target range and when setting compensation for 2020, the Committee considered that many current and former senior executive officers of leading companies in various industries have previously served as senior executives at Schlumberger.

Process for Determining Executive Compensation

Compensation Committee Evaluation Process; Role of Management

Our Compensation Committee reviews the elements of our NEOs’ total direct compensation throughout the year, to evaluate whether each element of direct compensation remains competitive with the companies in our two main executive compensation peer groups. In making compensation decisions, our Compensation Committee relies on its own judgment after its review of external market data, and also considers the following factors:

Each January, our Compensation Committee evaluates all elements of executive officer compensation, after a review of the prior year’s results and the achievement of Company financial objectives and each officer’s key 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 our Compensation 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 named executive officer 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 the Company. Our Vice President of Human Resources assists the CEO in developing the executive officers’ performance reviews and reviewing market compensation data to determine compensation recommendations for our executives.

The following table summarizes the approximate timing of significant annual executive compensation events:

Our Compensation Committee may, at its discretion, review and adjust officer compensation at other times during the year. For example, as discussed above under “Elements of Total Direct Compensation; 2020 Decisions—Annual Cash Incentive Awards—Financial Objectives,” in July 2020 the Committee approved certain modifications to our 2020 cash incentive plan in response to the effects of the COVID-19 pandemic and other factors that severely and negatively affected our industry, including the precipitous collapse in global oil demand and the resulting decline in demand for our services and products.

Granting Process for Long-Term Equity Awards

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. Management determines the allocation of such grants for groups within the Company and individual recommendations are made by the heads of the groups and approved by the CEO. Awards for executive officers other than the CEO are granted by our Compensation Committee and discussed with the Board. Awards for the CEO are granted by the Committee following approval by the full Board. In addition to considering the value of each equity-based award, management and our Compensation Committee also consider, as an additional factor in approving long-term equity awards, the overall potential stockholder dilution impact and “burn rate,” which is the rate at which awards are granted as a percentage of common shares outstanding.

The regular Board and Compensation Committee meeting schedule is set at least a year in advance with Board meetings held quarterly, generally in mid-January, April, July and October. The timing of these committee meetings is not determined by any of the Company’s executive officers and is usually two days in advance of the Company’s announcement of earnings. Our Compensation Committee usually sets the equity award grant date as the day of the Compensation Committee meeting. The Company does not time the release of material non-public information for the purpose of affecting the values of executive compensation. At the time equity grant decisions are made, our Compensation Committee is aware of the earnings results and takes them into account, but it does not adjust the size or the mix of grants to reflect possible market reaction.

Annual grants of equity-based awards to our NEOs, other senior executive officers and the rest of the Company’s eligible employees are made at the January meeting of our Compensation Committee. However, specific grants may be made at other regular meetings, to recognize the promotion of an employee, a change in responsibility or a specific achievement, or to achieve other key compensation objectives. Our Board and our Compensation Committee have the discretion to grant equity awards with different vesting schedules as they deem appropriate or necessary.

Role of the Independent Executive Compensation Consultant

Our Compensation Committee has retained Pay Governance as its independent consultant with respect to executive compensation matters. Pay Governance reports only to, and acts solely at the direction of, our Compensation Committee. Pay Governance prepares compensation surveys for review by our Compensation Committee at its October meeting. One of the purposes of the October meeting is to assess compensation decisions made in January of that year in light of comparative data to date; another purpose of the October meeting is to prepare for the annual executive officer compensation review the following January.

Pay Governance works with Schlumberger’s executive compensation department to compile annual compensation data for each executive officer, and to compare the compensation opportunities of our officers with those at comparable roles at companies in our main executive compensation peer groups. Our Compensation Committee has also retained Pay Governance as an independent consulting firm with respect to non-employee director compensation matters. Pay Governance 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.

Our Compensation 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.

Executive Stock Ownership Guidelines

Our Compensation Committee and management believe strongly in linking executive long-term rewards to stockholder value. In 2019, our Board, upon recommendation of our Nominating and Governance Committee and our Compensation Committee, adopted revised executive stock ownership guidelines applicable to our executive officers and other key position holders.

Senior executives are required to hold the numbers of shares equal to the multiple of base salary set forth below:

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.

The guidelines provide that 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 PSU and RSU vesting 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 December 31, 2020, all of our then-serving NEOs were in compliance with our stock ownership guidelines.

Other Executive Benefits and Policies

No Employment Agreements with Current NEOs

Historically, our named executive officers have not had employment, severance or change-in-control agreements with the Company, and serve at the will of the Board. This enables the Company to terminate their employment using judgment as to the terms of any severance arrangement and based on specific circumstances at the time they cease being executive officers. We do not enter into employment, severance or change-in-control agreements with any newly-hired executive officers.

Officer Departure Guidelines

In January 2020, our Compensation Committee approved guidelines covering, among other things, LTI vesting, salary, benefits and other compensation matters for officers departing the Company, 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 reference in its executive succession planning, with flexibility as required by specific situations.

The purpose of the officer departure framework is to incentivize outgoing Company officers to support their successors for a period of time; to provide for a smooth transition; to provide resources to the Company in particular areas of expertise; and to secure outgoing officers’ covenants not to compete with us and not to solicit key employees to leave us.

Under the guidelines, we may, at our discretion, enter into agreements with officers who are leaving the Company whereby they would receive annual cash payments that would generally be less than their pre-termination annual base salary. In addition, the officer would receive a prorated cash incentive award payment with respect to the year of his or her departure. The outgoing officer would also receive benefits such as medical and insurance during the agreement term, and would continue to vest in previously-granted LTI awards during the term. In exchange, the officer would agree to be available to Schlumberger for 50% of his or her business time during the term, and agree to non-competition, non-solicitation, and non-disparagement covenants.

Agreement with Former CFO

As previously disclosed in our definitive proxy statement for our 2020 annual general meeting of stockholders, Schlumberger and Mr. Ayat, our former CFO, entered into an agreement effective as of January 22, 2020 that provides for, among other things, certain benefits and payments through January 21, 2022, including a cash payment in each year of the term equal to his base salary prior to his retirement as CFO, in exchange for three-year non-competition and non-solicitation covenants on the part of Mr. Ayat. Under the terms of the agreement, Mr. Ayat agreed to devote 50% of his business time to Schlumberger as Senior Strategic Advisor to our CEO for a two-year period. Under the agreement, Mr. Ayat will also continue to participate during the term in Schlumberger’s health, welfare and insurance plans on a basis comparable to that of other U.S. employees. He also was granted a PSU award on January 16, 2020, as set forth in the “Grants of Plan-Based Awards for Fiscal Year 2020” table in this proxy statement.

Retirement Benefits

In line with Schlumberger’s aim to encourage long-term careers with the Company and to promote retention, retirement plans are provided, where possible, for all employees, including named executive officers, according to local market practice. We consider long-term benefit plans to be an important element of the total compensation package. Our pension plans provide for lifetime benefits for certain employees upon retirement after a specified number of years of service and take into account local practice with respect to retirement ages. They are designed to complement, but not be a substitute for, local government plans (which may vary considerably in terms of the replacement income they provide) and other Company-sponsored savings plans. Employees may participate in multiple retirement plans in the course of their Schlumberger careers, in which case they become entitled to a benefit from each plan based upon the benefits they earned during their years of service related to such plan. We fund these qualified plans through cash contributions based on actuarial valuations and/or regulatory requirements.

Some of our U.S. retirement plans are non-qualified plans that provide an eligible employee with additional retirement savings opportunities that cannot be achieved with tax-qualified plans due to limits on annual compensation that can be taken into account or annual benefits that can be provided under qualified plans.

Officers and other employees in the United States whose compensation exceeds the qualified plan limits are eligible to participate in non-qualified excess benefit programs for 401(k), profit-sharing and pension. Employees and executive officers assigned outside the United States are entitled to participate in the applicable plans of the country where they are assigned, including supplemental plans where available.

Other Benefits

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 Schlumberger minimum standard, we generally offer the Schlumberger standard. Our named executive officers 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 additional coverage. There are no special insurance plans for our named executive officers.

Limited Perquisites

We provide only limited perquisites to our named executive officers, which are identified in the narrative notes to the Summary Compensation Table.

Clawback Policy for Performance-Based Cash and Equity Awards

In 2019, our Board, upon the recommendation of our Compensation Committee, adopted a revised policy regarding recoupment of performance-based incentive compensation, whether paid in the form of equity or cash, in the event of specified restatements of financial results. Under the revised 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 such actions as 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 performance-based equity awards and any shares of stock that are issued as a result of vesting of these awards are subject to recoupment under the terms of those awards.

Impact of Tax Treatment

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 payable in excess of the $1 million limitation for our NEOs is not material relative to the benefit of being able to attract and retain talented management. Accordingly, our Compensation Committee will continue to pay compensation that is not deductible.

Compensation Committee Report

Our Compensation Committee has reviewed and discussed with the Company’s management the Compensation Discussion and Analysis included in this proxy statement. Based on that review and discussion, our Compensation Committee has recommended to our 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

Executive Compensation Tables and Accompanying Narrative

2020 Summary Compensation Table

The following table sets forth the compensation paid by the Company and its subsidiaries for the fiscal year ended December 31, 2020 to each of our NEOs.