Royal Dutch Shell’s ‘Goldilocks’ Choice

Jorma Ollila, the outgoing chief executive of Nokia, is "a good choice" to become the combined Royal Dutch Shell's first external chairman, said John Paul Rathbone at breakingviews.com.

He "many not know much about oil", but he does know a lot about corporate change, having transformed Nokia from a "maker of Wellington boots and rubber tyres" into the world's largest mobile phone maker. He should help shake up the oil giant - "which has long been hamstrung by an introspective and convoluted management structure" - when he takes on his new post in June next year.

And if Ollila succeeds in duplicating the Nokia "mindset" at Shell, investors can look forward to being "well rewarded". During his time in charge, Nokia has paid out over 33% of earnings in dividends and spent "much of the rest" on buying back shares.

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Ollila's "strategic abilities are not in question," said Lex in the FT. Importantly, he is also Finnish. The newly unified Shell is "keen for its streamlined structure to be seen as neither too English nor too Dutch". But faced with Shell's "unattractive growth profile" and project delays, even he may have difficulty guiding the group "between high-priced acquisitions and a more aggressive return of cash to shareholders".