At the company's annual general meeting in London, shareholders voted in favour of the company's remuneration report.

But a call for a shareholder rebellion attracted 23% of the vote, according to provisional figures.

The National Association of Pension Funds (NAPF) described it as a shot across the bows.

We feel that Shell is conservative in its approach to remuneration Peter Job Shell remuneration committee

"Often the size of any shareholder rebellion is a good indication to the company that investors will be looking at them more closely in the future," said a spokesman.

The NAPF had advised its members to vote against the pay package because Shell had not given enough information about the performance targets directors would have to meet in return for the extra shares.

Closing the gap

The new incentive scheme is in addition to a package which saw chairman Sir Philip Watts earn �1.8 million last year at a time when both profits and the share price fell.

As far as our members are concerned, Shell executives are already well rewarded Derek Simpson Amicus joint general secretary

At the meeting, Peter Job, representing Shell's remuneration committee, defended the level of rewards for top executives.

He said Shell had to keep pace with other major oil companies in order to attract the best talent.

"We feel that Shell is conservative in its approach to remuneration," he told the meeting.

"We have felt in the last year or two that the gap between us and the others is getting a bit too large."

Takeover deal

The trade union Amicus held a demonstration to protest about the pay package, pointing out that the company had just announced 650 redundancies.

"As far as our members are concerned, Shell executives are already well rewarded," said Derek Simpson, joint general secretary of Amicus.

The vote on the new incentive plan gives shareholder backing to Shell's UK-listed arm, Shell Transport and Trading.

On Thursday, the chief executive of Barclays, Matt Barrett, is also likely to face shareholder anger at his company's AGM because of a deal that could see him pick up �4m if the bank is taken over and he is forced out.