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Royal Dutch Shell: Company Strategies for Dealing with Environmental Issues

  • Keetie Sluyterman (a1)

The intricate interplay among environmental pressure groups, oil companies, and governments is revealed from the perspective of the Anglo-Dutch company Royal Dutch Shell. An examination of three environmental issues demonstrates the company's awareness of such problems and describes its efforts to contain potential damage to the degree permitted by existing technological and economic constraints. The industry view is that government measures should create a level playing field and should be effective and economically feasible. While pressure groups are skilled at calling attention to environmental problems, industry highlights the tradeoffs between different societal aims that are entailed in tackling these problems. Governments are left to fi nd the best ways to weigh conflicting interests.

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1 Doyle Jack, Riding the Dragon: Royal Dutch Shell and the Fossil Fire (Boston, 2002).

2 Quoted in Lerner Steve, Diamond: A Struggle for Environmental Justice in Louisiana's Chemical Corridor (Cambridge, Mass., 2005), 278.

3 Lindmark and Bergquist offered this suggestion: Lindmark Magnus and Bergquist Ann Kristin, “Expansion for Pollution Reduction? Environmental Adaptation of a Swedish and a Canadian Metal Smelter, 1960–2005”, Business History 50 (2008): 530–46.

4 Rosen Christine Meisner and Sellers Christopher C., “The Nature of the Firm: Towards an Ecocultural History of Business”, Business History Review 73 (1999): 577600.

5 Jones Geoffrey and Zeitlin Jonathan, Oxford Handbook for Business History (New York, 2008), 5.

6 Gorman Hugh S., Redefining Effi ciency: Pollution Concerns, Regulatory Mechanisms, and Technological Change in the U.S. Petroleum Industry (Akron, Oh., 2001), 109.

7 Fischer Kurt and Schot Johan, “Introduction: The Greening of the Industrial Firm”, in Environmental Strategies for Industry: International Perspectives on Research Needs and Policy Implications, ed. Fischer Kurt and Schot Johan (Washington, D.C., 1993), 333.

8 Howarth Stephen and Jonker Joost, A History of Royal Dutch Shell, vol. 2: Powering the Hydrocarbon Revolution (Oxford, 2007), 401–39.9DePuis E. Melanie, “Introduction”, in Smoke and Mirrors: The Politics and Culture of Air Pollution, ed. DePuis E. Melanie (New York, 2004), 111.

10 Higher compression caused gasoline to “pre-ignite” before the piston completed its downstroke.

11 Jonker Joost and Zanden Jan Luiten van, A History of Royal Dutch Shell, vol. 1: From Challenger to Joint Industry Leader (Oxford, 2007), 340–43 ; Beaton Kendall, Enterprise in Oil: A History of Shell in the United States (New York, 1957), 412–14.

12 McCarthy Tom, Auto Mania: Cars, Consumers, and the Environment (New Haven, Conn., 2007), 48.

13 Ibid., 49.

14 Markowitz Gerald and Rosner David, Deceit and Denial: The Deadly Politics of Industrial Pollution (Berkeley, Calif., 2003), 1235.

15 McCarthy, Auto Mania, 49.

16 Jonker and Zanden van, History of Royal Dutch Shell, vol. 1, 343, 525n32 ; Beaton, Enterprise in Oil, 412–14.

17 Forbes R. J., “Technische ontwikkeling van de Koninklijke, 1914–1940” (Dec. 1944): 7081, internal report, Shell The Hague Archives, Netherlands (SHA); Forbes R. J. and O'Beirne D. R., The Technical Development of the Royal Dutch/Shell, 18901940 (Leiden, 1957), 397401 ; for more about the Asian market agreement, See Jonker and Zanden van, From Challenger to Joint Industry Leader, 443.

18 Uekoetter Frank, “The Merits of the Precautionary Principle: Controlling Automobile Exhaust in Germany and the United States before 1945”, in Smoke and Mirrors: The Politics and Culture of Air Pollution, ed. DePuis E. Melanie (New York, 2004), 119–53.

19 Rove D. J., Lead Manufacturing in Britain, a History (London, 1983), 233–35, 360–62.

20 Carson Rachel, “A Fable for Tomorrow”, in Silent Spring (Boston, 1962), ch. 1.

21 Nriagu Jerome O., “The Rise and Fall of Leaded Gasoline”, The Science of the Total Environment 92 (1990): 1328, 20–23 ; McCarthy, Auto Mania, 180–81.

22 Royal Dutch Petroleum Company, Annual Report, 1963.

23 Report by Lord Rothschild on Pollution, 5 July 1967, “Environmental Conservation, 1967–1968”, Committee of Managing Directors (CMD) fi les, S28, Shell London Archives (hereafter SLA); see also Howarth and Jonker, Powering the Hydrocarbon Revolution, 423–25.

24 Markowitz and Rosner, Deceit and Denial, 117.

25 McCarthy, Auto Mania, 178–80.

26 Royal Dutch Petroleum Company, Annual Report, 1970.

27 Pratt Joseph A., Prelude to Merger: A History of Amoco Corporation, 19731998 (Houston, 2002), 7479.

28 Report by Lord Rothschild on Pollution, 5 July 1967.

29 Shell News 4 (1979): 1216.

30 Product Safety and Environmental Conservation Report for 1975, CMD fi les, S74; and Product Safety and Environmental Conservation Report for 1978, CMD fi les S83, both SLA.

31 Product safety, Occupational Health and Environmental Conservation Report for 1983, CMD fi les, S108, SLA.

32 Chandler Geoffrey, “Shell's Reputation”, Interchange 62 (Jan./Feb. 1972).

33 Minutes CMD, 10 June 1969, Environment and Public Health/Safety, 1969–75, CMD fi les, S63, SLA. In this role CMD nominated E. J. G. Toxopeüs, who in 1969 became chairman of the Interfunctional Contact Committee, which was renamed Environmental Conservation Committee.

34 Minutes CMD, 13 Oct. 1970, Public Affairs, 1969–1975, CMD fi les, S67, SLA.

35 Tookey Richard, “PA is Good Business”, Interchange 19 (1988).

36 Tookey Richard, “Public Opinion in the 90s: Threat or Opportunity?” Interchange (1991).

37 Interview with Braks Tony, Shell World, Oct. 1994.

38 Sluyterman Keetie, A History of Royal Dutch Shell, vol. 3: Keeping Competitive in Turbulent Markets, 1973—2007 (Oxford, 2007), 335–41.

39 “Brent Field: A Comparison of Two Field Offtake Systems”, MR 81, SLA.

40 Conference minutes, 12 July 1995, including attachments, “Shell U.K. Issues Brief: North Sea abandonment–Brent Spar disposal”, Feb. 1995 and update on 1 May 1995, SLA.

41 Zyglidopoulos Stelios C., “The Social and Environmental Responsibilities of Multinationals: Evidence from the Brent Spar Case”, Journal of Business Ethics 36 (2002): 141–51.

42 Conference minutes, 12 July 1995, including attachments, SHA.

43 Conference minutes, 14 June 1995, SHA.

44 Zyglidopoulos, “Social and Environmental Responsibilities”, 144.

45 Conference minutes, 12 July 1995, including attachments; interview by author with C. A. J. Herkströter, 14 Dec. 2004.

46 Conference minutes, 13 Sept. 1995; C. A. J. Herkströter letter, 31 July 1995, both SLA.

47 Ibid.

48 Conference minutes, 15 July 1995, SHA.

49 Financial Times, 6 Sept. 1995; Peter Melchett to Shell U.K., 4 Sept. 1995, (accessed 6 Jan. 2005).

50 Greenpeace under Fire on Brent Spar Coverage”, Nature 377 (1995): 6.

51 “Brent Spar—The Wider Perspective”, Shell Management Brief (Aug. 1995).

52 “Brent Spar: See and Hear the Solution”, Interchange (1998): 17.

53 OSPAR Decision 98/3 on the Disposal of Disused Offshore Installations, 1998,

54 Report by Lord Rothschild on Pollution, 5 July 1967.

55 Minutes CMD, 22 Aug. 1979, Environment, public health, safety, 1976–1978, CMD fi les, DCS, S74, SLA.

56 HSE review 1985, discussed 12 Aug. 1986, Environment, public health, and safety, 1986, CMD fi les, DCS, S116, SLA.

57 World Commission of Environment and Development World Commission, Our Common Future (Oxford, 1987), 43.

58 Ibid., 308–43.

59 Conference minutes, 12 Feb. 1992; PA review, “Profi t with Responsibility”, both SHA.

60 Visser Koos, “The Test of Tomorrow”, Shell Selected Papers (Sept. 1993).

61 Product Safety, Occupational Health and Environmental Conservation report for 1988, HS/1990, CMD fi les, DCS, S130, SLA.

62 Davies Ged, “Global Warming: The Role of Energy Effi cient Technologies”, Shell Selected Papers (1989).

63 “Global Climate Change”, Shell Briefi ng Service (SBS) (1990).

64 Shell World, Feb. 1995.

65 Statement of the Global Climate Coalition before the Senate Committee on Environment and Public Works Hearing on S5565, the Clean Power Act, Nov. 1, 2001:

66 Moody-Stuart Mark, “Winners and Losers—Meeting the Upstream Challenges of the 21st Century”, speech given at the AAPG/SVG Congress, 9 Sept. 1996, Caracas, Venezuela.

67 Herströter Cor, “Refl ections on Kyoto”, 2 Feb. 1998.

68 Speech by Browne John, Royal Institute of International Affairs conference, Chatham House, London, 6 Feb. 1998.

69 Kolk Ans and Levy David, “Winds of Change: Corporate Strategy, Climate Change and Oil Multinationals”, European Management Journal 19 (2001): 501–9.

70 Watts Philip, “Energy and Climate—The Role of Industry”, paper presented at the World Business Council for Sustainable Development and Eidanren seminar, Tokyo, 5 June 2003.

71 “People, Planet ”, Shell Report, 1999.

72 “Meeting the Energy Challenge”, Shell Report, 2002.

73 Sluyterman, Keeping Competitive, 426–30.

74 Gore Al, An Inconvenient Truth: The Planetary Emergency of Global Warming and What We Can Do About It (New York, 2006).

75 Climate Change 2007: Synthesis Report by the Intergovernmental Panel on Climate Change (Geneva, 2007).

76 Veer Jeroen van der, “Our Approach to Climate Change”, introduction to Shell Sustainability Report, 2006 (2006).

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Business History Review
  • ISSN: 0007-6805
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