If you watch closely, you just might see Royal Dutch Shell (NYSE:RDS-A) go from an also-ran among Big Oil to a company that manages its assets and its shareholder relations more effectively than it has in the past.

In fact, we may be on the verge of a major transformation. Back in 2004, the company was involved in a scandal regarding its reserves and faced a series of class action lawsuits. Shell ultimately paid hundreds of millions of dollars in fines and settlements.

With that blot pretty much behind it, Shell now appears to be taking a number of steps to get its house in order, and ultimately become a company capable of competing with the likes of ExxonMobil (NYSE:XOM) and BP (NYSE:BP). For example, the company has announced significant changes in the way it compensates top executives. For starters, CEO Peter Voser and CFO Simon Henry will take 20% salary cuts compared to their predecessors. And the salaries for the company's three top executives -- including Malcolm Brinded, who heads up global upstream operations -- will be frozen until early next year.

The company's board will also be precluded from awarding performance-based shares to the three men unless they are able to meet or exceed targets. In the past, the company has doled out bonuses even when goals were not met. All this comes within a year of a shareholder protest against Shell's executive pay policies. The protest was set off largely by existing bonus policies.

You shouldn't get the idea that Shell is alone in the energy industry in overpaying its executives. Chesapeake Energy (NYSE:CHK), Nabors Industries (NYSE:NBR), and XTO Energy (NYSE:XTO) all ranked among the top 10 companies in CEO pay for 2008.

In addition to the pay issue, unconfirmed rumors have been circulating that Shell intends to unload as much as $10 billion of its assets. Mentioned among the possible sales are oil fields in the North Sea and Nigeria, its African gas station network, and a trio of refineries in Europe.

I'll need to see Shell make more progress before I get excited. While you almost certainly should have an integrated company or two in your portfolio, I'm still far more attracted to the likes of ExxonMobil and BP.

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Fool contributor David Lee Smith doesn't own shares in any of the companies mentioned. He does welcome your questions, or concerns. Chesapeake Energy is a Motley Fool Inside Value recommendation. The Fool owns shares of Chesapeake Energy and XTO Energy. The Motley Fool has an unstoppable disclosure policy.