1. SUSTAINABILITY 2. OUR CORE 3. ACHIEVING 4. RESPECTING 5. POWERING 6. GENERATING 7.

OUR
AT SHELL VALUES NET-ZERO NATURE LIVES SHAREHOLDER PERFORMANCE
EMISSIONS VALUE DATA

LIVING BY OUR
CORE VALUES
18 Business ethics and
Our Powering Progress strategy is
transparency
underpinned by our core values of
honesty, integrity and respect for 23 Safety
people, and our focus on safety. This
includes our commitment to doing
business in an ethical and transparent
way.

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BUSINESS ETHICS AND TRANSPARENCY

ETHICAL LEADERSHIP Speaking up
Our core values of honesty, integrity and respect for people underpin Shell employees, contractors and any third party can report any
our work with employees, customers, investors, contractors, suppliers, potential breaches of the Code of Conduct confidentially and
non-governmental organisations and others. The Shell General anonymously through several channels, including a global helpline,
Business Principles, introduced more than 40 years ago, describe our operated by an independent provider.
core values, our responsibilities and the principles and behaviours that
guide how we do business. Shell has specialists who investigate concerns or allegations about a
breach of our Code of Conduct. If a breach is substantiated, the
Ethical leadership during COVID-19 relevant Shell company will take appropriate action up to and
In 2020, we stepped up efforts to support our employees, contractors including a contract termination or dismissal. We maintain a stringent
and those we do business with to make the right ethical choices and no retaliation policy to protect any person making an allegation in
adhere to Shell’s compliance expectations in response to challenges good faith.
from the COVID-19 pandemic.
ANTI-BRIBERY AND CORRUPTION
We developed guidance on COVID-19 to help Shell leaders set the Shell has rules on anti-bribery and corruption in our Code of Conduct
tone for behaving ethically and to promote compliance in their and Ethics and Compliance Manual. Both are available publicly
teams. We offered additional practical advice on avoiding potential online. Contractors and consultants are also required to act
breaches of our Code of Conduct. This advice covered managing consistently with our Code of Conduct when acting on our behalf.
potential conflicts of interest while working at home, where work and
family lines may be blurred. We issued reminders to complete In 2020, we also made our Code of Conduct training publicly
mandatory training and emphasised that leaders should ensure available, with the aim to ensure contract staff working for Shell
people feel comfortable speaking up. understand their personal responsibilities. In addition, using a risk-
based approach, we started offering select third parties, such as
distributors and suppliers, an online anti-bribery and corruption
training course, free of charge and in several languages.

In March 2021, Shell and four former employees were acquitted in a

long-running trial in Milan related to a Nigerian oil block called OPL
245. Shell has always maintained that the 2011 settlement with the
Federal Government of Nigeria and Eni that was at the heart of this
trial was a legal transaction, so we welcome the ruling. This has been
a difficult learning experience for Shell. Business integrity is one of our
core values and we continue to work hard to raise standards in this
area. You can read Shell's detailed response at www.shell.com/shell-
comments-on-the-verdict-from-the-milan-tribunal-over-opl-245

PERSONAL DATA
Shell respects the privacy of individuals and recognises that personal
We work to ensure our workplace is an environment where people feel
comfortable speaking up.
data belong to the individual. We take action to manage personal
data in a professional, lawful and ethical way.

This work built on the ethical leadership expectations programme, Our privacy policies, notices and other customer agreements clearly
which was introduced in 2018 and continues to be rolled out for senior define the data we are collecting, why they are being collected, who
leaders across Shell. The programme was designed to reinforce the has access to them and for how long. We seek to process only the
level of commitment to ethics and compliance in senior leaders. minimum data required, such as when customers participate in loyalty
schemes or pay for fuel on their phones without leaving their vehicle.
In 2020, we also developed a new decision-making framework to Personal data processed in our systems are secured appropriately and
ensure that we continue to make ethical decisions in line with our treated with respect to maintain privacy for our employees, partners
Code of Conduct. The framework, which has been externally reviewed, and millions of customers around the world. The COVID-19 pandemic
will help staff to think through, in a structured way, the legal, ethical increased the need to process personal data, for example, when
and external consequences of the various decisions they face in their employees, suppliers and others visit our premises.
daily work. We are launching the framework in 2021.
Our specialists work closely with teams across Shell to maintain
Supply chain compliance with our data privacy standards and to ensure that we use
In 2020, we took steps to strengthen and simplify our approach to data in an ethical way. In 2020, we continued to evolve our
working with suppliers and contractors amid COVID-19 uncertainties. approach. For example, we analysed new data privacy regulations,
For example, we adapted our due diligence assessments to ensure such as those in Brazil and California, USA, and the advice of
partners that look to save costs do not compromise ethical conduct. regulatory and industry bodies, including the World Federation of
We also produced additional COVID-19 guidance for employees, Advertisers. We also review our marketing standards, including our
highlighting potential corruption and money laundering risks in supply apps and websites, to keep them up to date with best practices.
chain and relief donations.

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Cyber security
Shell is subjected to frequent cyber-security attacks, including attacks
LIVING BY OUR PRINCIPLES
targeting our customer database, and the COVID-19 pandemic led to
an increase in such activity. Data breaches have occurred at Shell.
SHELL GLOBAL HELPLINE Where systems, customer accounts and data have been compromised,
we have notified data privacy regulators and affected customers
where appropriate.

1,425 We regularly monitor our IT systems for possible vulnerabilities to

cyber attacks. Our incident-handling process helps to ensure that we
Reports to the helpline deal effectively with an issue. The process also helps us to meet the
most stringent regulatory reporting timelines, for example, the 72-hour
requirement under the General Data Protection Regulation.
CODE OF CONDUCT
Read more about our values at www.shell.com/values and our
requirements for our businesses and functions to comply with at
www.shell.com/shell-ethics-and-compliance-manual
216 COLLABORATIONS AND STAKEHOLDER ENGAGEMENT
Confirmed breaches of the Code of We work with governments, non-governmental organisations, industry
Conduct bodies, national oil and gas companies and many other businesses.
These collaborations range from working together on a project to
sponsoring a particular group. These efforts help us learn, share best
TAKING ACTION practice, achieve specific objectives, set future goals and build trust
with our stakeholders.

For example, we work with Building Responsibly, a group of

252 companies that collaborate to promote the rights and welfare of
workers across the engineering and construction industries (see
Employees or contractor staff subject to Respecting human rights).
disciplinary action
Working together to lower emissions
TAKING ACTION We are a founding member of the Energy Transitions Commission,
which brings together leaders from other energy companies, financial
institutions, wider industry partners and civil society groups. The
commission aims to achieve net-zero emissions by mid-century, in line
54 with the Paris Agreement climate goal of limiting global warming to
well below two degrees Celsius and ideally to 1.5°C.
People dismissed
In 2020, the commission released the Making Mission Possible: Delivering
A Net-Zero Economy report. Shell welcomes the report, which sets out the
milestones in the 2020s to put the commission’s 2050 targets within reach.
CONTINUOUS SCREENING
Shell also worked with the UN Environment Programme, Environmental
Defense Fund, energy businesses and others to develop an updated Oil

5.1 million
& Gas Methane Partnership 2.0 reporting framework for tracking
methane emissions. The framework agreement was signed in 2020, and
makes it easier for officials, investors and the public to accurately track
Counterparties screened for trade and compare performance across companies. European Union
compliance, anti-bribery, anti-corruption policymakers are considering using it as a basis for legislation. Shell was
and anti-money laundering on an ongoing also part of a group of energy companies and environmental
organisations which shared recommendations with the European
basis
Commission on how to reduce methane emissions.
ENHANCED COMPLIANCE REVIEWS
We also work with the Oil and Gas Climate Initiative, a voluntary
CEO-led group that focuses on carbon capture, utilisation and storage,
methane detection and reduction, as well as energy efficiency. In 2020,

8,246 the group announced a new target to reduce the collective average
carbon intensity of member companies’ aggregated upstream oil and
gas operations to between 20 kilograms and 21 kilograms of carbon
Enhanced pre-screenings for higher-risk
dioxide equivalent per barrel of oil equivalent by 2025. This target is
contracts consistent with the reduction needed across the oil and gas industry by
2025 to support the goals of the Paris Agreement.

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COLLABORATIONS OVERVIEW
The table shows some of the organisations that we collaborate with globally on topics such as environmental sustainability and technology. Shell
also works with many community-based organisations.

Environmental Human rights Safety and Technology Transparency

sustainability and and social technical and and
climate change responsibility standards innovation governance

Alliance to End Plastic Waste

B Team Responsible Tax Principles

Bonsucro

Building Responsibly

Business for Social Responsibility

Clean Cooking Alliance

Clean Skies for Tomorrow Coalition

Earthwatch

Employment and Skills for Eastern Africa E4D / SOGA

Energy Institute (EI)

Energy Transitions Commission (ETC)

Extractive Industries Transparency Initiative (EITI)

GIZ

Global Road Safety Partnership (GRSP)

HeliOffshore

Hydrogen Council

International Association of Oil & Gas Producers (IOGP)

International Sustainability and Carbon Certification (ISCC)

International Union for Conservation of Nature (IUCN)

IPIECA (industry association for environmental and social issues)

Jet Zero Council

Mercy Corps

Methane Guiding Principles Coalition

Mission Possible Partnership

Oil and Gas Climate Initiative (OGCI)

Roundtable for Responsible Soy (RTRS)

Roundtable for Sustainable Biomaterials (RSB)

Roundtable for Sustainable Palm Oil (RSPO)

The Nature Conservancy (TNC)

The Valuable 500

Transparency International UK Business Integrity Forum

UN Environment Programme (UNEP)

UN Global Compact

UN World Food Programme (WFP)

Voluntary Principles Initiative

World Business Council for Sustainable Development (WBCSD)

World Economic Forum (WEF)

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POLITICAL ENGAGEMENT In accordance with the Shell General Business Principles, all Shell staff
Shell engages governments, regulators and policymakers to help and people working in joint ventures we operate are required to
shape comprehensive and effective policy, legislation and regulation. comply with all applicable laws and regulations of the countries in
We advocate our positions on matters which affect us, our employees, which we operate, including on lobbying. We report on our lobbying
customers, shareholders or local communities, in accordance with our activities in line with local requirements. For example, in the EU and
values and the Shell General Business Principles. the USA, we report our costs relating to lobbying activities in line with
the requirements and guidelines set out in the EU Transparency
We provide our statement on corporate political engagement and Register and the US Lobbying Disclosure Act, respectively. These
positions on key public issues on our website www.shell.com/ submissions are publicly available.
advocacy. Shell senior executives endorse our advocacy
priorities annually. TAX TRANSPARENCY
Taxes are a vital source of revenue for countries around the world and
We also advocate to political stakeholders indirectly, for example, help to fund essential services like education, health care and transport.
through industry associations or advocacy coalitions. Our Industry In times of crisis such as the COVID-19 pandemic, taxes are also central
Associations Climate Review 2021 assesses our alignment with key to government policies to support people’s lives and livelihoods.
industry associations on Shell’s climate-related policy positions.
Being transparent is about showing how developing energy resources
Examples of our advocacy in practice are support for the European responsibly provides governments with an opportunity to generate
Union’s (EU) target to achieve climate neutrality by 2050 and revenues, support economic growth and enhance social development.
advocating a return to the direct regulation of methane emissions
under the Clean Air Act in the USA. Shell publishes a Tax Contribution Report annually which sets out the
corporate income tax that Shell companies paid in countries and
Shell companies do not make payments to political parties, locations around the world where Shell companies have a taxable
organisations or their representatives. Shell employees, suppliers or presence. You can read our latest report at https://reports.shell.com/
contractors acting on behalf of Shell must not use Shell funds or tax-contribution-report/2019
resources, either directly or indirectly, to help fund political campaigns,
political parties, political candidates, or anyone associated with them. The Tax Contribution Report builds on the information we disclose in
Political payments or in-kind contributions must never be made by or our Annual Report and Accounts, Form 20-F, the Sustainability Report
on behalf of Shell companies or by industry associations with and the Payments to Governments Report.
Shell funds.
The report shows how our business activities are taxed globally. It
In the USA, Shell Oil Company administers the non-partisan Shell Oil outlines Shell’s approach to tax which is centred on compliance,
Company Employees’ Political Awareness Committee (SEPAC), a transparency and open dialogue. Compliance is embedded in our
political action committee registered with the US Federal Election Shell General Business Principles and the Code of Conduct. We do
Commission. Eligible employees may make voluntary personal not condone, encourage or support tax evasion. In the report, we
contributions to the SEPAC. All employees’ contributions comply with share information about our use of tax incentives and where we
federal and state law and are publicly reported in accordance with operate and why.
US election laws. Shell Oil Company does not exercise control over
SEPAC’s funding decisions. In 2020, Shell paid more than $47.3 billion to governments. We paid
$3.4 billion in corporate income taxes, $3.5 billion in government

OVERVIEW OF TAX AND OTHER PAYMENTS TO GOVERNMENTS

Corporate income taxes Production entitlements

$3.4 billion $7 billion

Royalties $47.3 billion $8.2 billion Bonuses

Taxes paid Other payments
$3.5 billion and collected to governments $0.02 billion

Excise duties, sales taxes

and similar levies Fees
$1.2 billion
$40.4 billion

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royalties and collected $40.4 billion in excise duties, sales taxes and for commercial reasons. We do not use these locations to avoid
similar levies on our fuel and other products on behalf of governments. taxation on activities that take place elsewhere.

Incentives and low-tax jurisdictions In 2019, we launched a review of parts of our corporate structure
Governments use tax incentives to encourage investment in their against our Shell Responsible Tax Principles, which have been
country. Shell uses available and appropriate tax incentives where we developed with the non-profit organisation, The B Team, and which
have a qualifying business activity. guide our decisions on tax matters.

For example, in Poland, the government has designated zones to We frequently review our corporate and financing structures to ensure
accelerate economic development. We created jobs in one of these these remain consistent with our policies and principles. This has led to
economic development zones in Krakow and as a result qualify for tax the liquidation and restructuring of some entities that were in low- or
incentives that partially exempt us from paying corporate income tax. zero-tax jurisdictions. For example, in 2019, we ended our financing
activities from Switzerland to some Shell operating companies and, in
Governments sometimes set low corporate income tax rates to attract 2020, we ceased our lending activities in Bermuda.
investment. When we are present in low-tax jurisdictions, we are there

SHELL RESPONSIBLE TAX PRINCIPLES

Principle 1: Accountability and Governance

Tax is a core part of corporate governance and responsibility and is overseen by Royal Dutch Shell plc’s Board of Directors.

Principle 2: Compliance
We are committed to complying with the tax legislation of the countries in which we operate and pay the right amount of tax at
the right time, in the countries where we create value.

Principle 3: Business Structure

We will only use business structures that are driven by commercial considerations, are aligned with business activity and which
have genuine substance. We do not seek abusive tax results.

Principle 4: Relationships with Authorities

We seek, wherever possible, to develop cooperative relationships with tax authorities, based on mutual respect, transparency
and trust.

Principle 5: Seeking and Accepting Tax Incentives

Where we claim tax incentives offered by governments, we seek to ensure that they are transparent and consistent with
statutory and regulatory frameworks.

Principle 6: Supporting Effective Tax Systems

We engage constructively in national and international dialogue with governments, business groups and civil society to support
the development of effective tax systems, legislation and administration.

Principle 7: Transparency
We provide regular information to our stakeholders, including investors, policymakers, employees, professional service
providers and the general public about our approach to tax and taxes paid.

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SAFETY
OUR APPROACH TO SAFETY and processes can fail. We are taking steps to help people make more
Safety is central to the responsible delivery of energy. We aim to do considered decisions about risks and prevent harm when things do not
no harm to people and to have no leaks across our operations. We go as planned. We want to get to a place where even if there is an
call this our Goal Zero ambition. incident, our people emerge unhurt.

We expect everyone working for Shell only to start work when all Embracing a “learner mindset”
required safety measures are in place and to intervene when anything Our new approach centres on people being open to learn, both from
appears unsafe or conditions change. things that went well and from their mistakes, and confidently sharing
ideas and concerns with colleagues. Being open in this way means
We investigate incidents and aim to learn from them, sharing findings mistakes are reported quickly so action can be taken. Teams that
to improve safety performance across our organisation and embrace this learner mindset can more easily identify better ways to
our industry. manage safety risks. We are also updating our various systems and
controls to enable people to more effectively identify and address
potential safety incidents. This means, for example, strengthening the
way work is planned by having more in-depth discussions before,
during and after tasks to identify and implement improvements.

In 2020, we provided training for leaders throughout Shell to help

them understand and explore the learner mindset and behaviours they
need to adopt. The training focused on systems and conditions that
influence their team decisions, as well as the effectiveness of
protective barriers.

Practical changes in 2020 under our refreshed safety

approach included:

▪ announcing plans to move from our Life-Saving Rules to the

International Association of Oil & Gas Producers Life-Saving Rules,
Shell staff in the USA practice social distancing for a briefing as part of
efforts to stay safe in response to the COVID-19 pandemic.
which include a new rule that focuses on keeping people out of the
line of fire;
▪ replacing our metric for Total Recordable Case Frequency (TRCF)
We help all Shell employees and contractors to comply with our safety with a new metric for Serious Incidents and Fatalities Frequency
standards and requirements, including our mandatory Life-Saving (SIF-F) that will take effect from 2021. This will enable us to measure
Rules. We discuss dilemmas, share ideas and learn together how rules our performance and help us better understand those instances
and procedures apply in the context of our work. where we have not been able to prevent significant harm; and
▪ launching an online portal with learning materials related to our
In response to the COVID-19 pandemic, we took additional steps to
refreshed approach to safety, which we made available to
make workplaces safe for staff and contractors, for example,
contractors and suppliers.
supporting our business partners to set up extra accommodations for
frontline contractors to allow for greater social distancing.
Personal safety performance
In 2020, Shell had the safest year it has ever experienced. It was the
Refreshing our safety approach
first year with zero fatal injuries, and also the strongest ever process
In 2020, we started what is expected to be a multi-year effort to
safety performance at ventures operated by Shell.
refresh our approach to safety for all employees and contractors. This
followed a review that considered the effectiveness of preventative
tools, such as the Life-Saving Rules, and our Goal Zero ambition.
FATAL ACCIDENT RATE (FAR) [A]
Since the early 2000s, these tools have helped strengthen our safety Number per 100 million hours
culture and performance, but we have not been able to sustainably 2
eliminate all fatal incidents involving Shell employees or contractors.

We are now implementing our new approach with a more consistent

1
focus across the organisation on the way people, culture, equipment,
work systems and processes all interact. The majority of our fatalities
over the last five years were down to the interaction between
these elements. 0
11 12 13 14 15 16 17 18 19 20

We encourage people to spend more time in teams reflecting on and

[A] We have updated some of our historical figures following a review of the data.
improving their understanding of the gap between how we anticipate
work will be safely carried out and what happens in reality. We
continue to work to prevent incidents through maintaining safety Our fatal accident rate – the number of fatalities per 100 million
barriers and training, but acknowledge that people can make mistakes working hours – decreased to 0 in 2020 compared with 1.4 in 2019.

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TOTAL RECORDABLE CASE FREQUENCY (TRCF) LOST TIME INJURY FREQUENCY (LTIF)
Number per million hours Number per million hours
2 0.5

1 0.25

0 0
11 12 13 14 15 16 17 18 19 20 11 12 13 14 15 16 17 18 19 20

In 2020, the number of injuries per million working hours – the total The level of injuries that led to time off work in 2020 decreased to 0.2
recordable case frequency (TRCF) – was 0.7, compared with a 2019 compared with 0.3 in 2019.
TRCF of 0.9.
For details of Shell’s 2020 safety performance and remuneration
The number of recordable injuries decreased by around 35% in 2020 outcomes, see the Directors’ Remuneration Report in our
compared with 2019, which was partly due to the impact of the Annual Report.
COVID-19 pandemic. COVID-19 restrictions meant that many staff
members were working from home, fewer people were able to travel
on Shell business and many of our work activities, including higher-risk
ones, were reduced or carried out differently.

HSSE & SP CONTROL FRAMEWORK

The HSSE & SP Control Framework defines mandatory standards, requirements and accountabilities.
The framework applies to Shell entities and Shell-operated ventures, including employees and contractor staff.

Mandatory manuals – Purpose of the manual – Scope

describe: – Accountabilities and responsibilities – Requirements to be met

HSSE & SP
Management System Health Personal Safety

Process Safety Environment Social Performance

Security Product Stewardship Transport

Contractor HSSE Resources

Management Projects

Shell Commitment and Policy on Health, Security, Safety,

the Environment and Social Performance

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PROCESS SAFETY clear guidelines for good operating practice to prevent unplanned
Process safety management is about keeping hazardous substances in releases of hazardous materials. We encourage employees and
pipes, tanks and vessels so they do not cause harm to people or contractors to use them in daily conversations to identify safety
the environment. dilemmas, so they can be resolved.

It starts with designing and building projects and is implemented Advances in technology
throughout the life cycle of the facilities to ensure they are operated In 2020, we increased our use of drones, robots and digital
safely, well maintained and regularly inspected. technology, such as augmented reality, as lockdowns caused by the
COVID-19 pandemic disrupted the movement of people. This
Refreshing our approach technology enabled us to carry out more remote monitoring and
Process safety management remains central to the updated approach continue to assure data to meet safety and environmental
to safety we started to deploy for all employees and contractors from performance reporting standards.
2020 (see Our approach to safety).
An example of this technology in action is at the Shell-operated
While we continue to work to prevent incidents through maintaining Ormen Lange facility where teams sent a remote-controlled vessel
safety barriers and ensuring good operating practices, we are also alone into the Norwegian Sea, 100 kilometres from land, to inspect
implementing our refreshed approach which has a more consistent the gas field. This enabled mariners based in Ireland to take the helm
focus on how people interact with these processes. We acknowledge using a computer-generated joystick without breaching COVID-19
that people can make mistakes and processes can fail. restrictions. Read the full story: How technology stepped up when
COVID-19 struck.
We are working to ensure continuous learning is a deeply embedded
habit and our workplace is an environment where people feel
comfortable to speak up, particularly on difficult issues.

We are updating the various systems and controls we have in place to

enable people to more effectively identify and address potential
safety incidents. For example, we are improving work planning by
having more in-depth discussions before, during and after tasks to
identify and implement improvements.

Increasingly, we concentrate on leading indicators of process safety to

understand the effectiveness of our barriers and work processes, rather
than focusing just on indicators of past performance, such as the
absence of safety incidents.

The X-07 vessel collected data from the Ormen Lange gas field in Norway,
RISK MANAGEMENT APPROACH while remotely operated by experts based in Ireland.

Process safety performance

In line with industry standards, we measure and report process safety
Threats
TOP
Consequences incidents according to significance, with Tier 1 as the most significant
EVENT category.

CONTROLS, BARRIERS RECOVERY MEASURES

TIER 1+2 OPERATIONAL PROCESS SAFETY EVENTS [A]

Our global standards and operating procedures define the controls and physical
* excluding sabotage
barriers we believe are necessary to prevent incidents. We refer to this system of
barriers and recovery measures as a bow-tie model, which visually represents a system 500
where process safety hazards are managed through prevention and response barriers.
400

300

We also continue to better align the various approaches to managing

200 b
facilities across our businesses to enable safer ways of working. For
example, all Shell-operated facilities and some non-operated ventures 100

have adopted a single global asset management system. The system 0

a

simplifies work processes and helps people across Shell share 12 13 14 15 16 17 18 19 20

expertise in asset equipment care, maintenance, learning from
incidents and assurance.
a Tier 1
b Tier 2
Process safety fundamentals
Our refreshed approach to safety is built on work we have carried out [A] Process safety events classified according to guidance from the IOGP and API. In 2020,
since 2016 to strengthen barriers involving critical safety tasks there was one Tier 1 sabotage-related event. The classification of sabotage-related process
performed by front-line staff. Embedding a set of 10 process safety safety events is made on the best-endeavours basis.
fundamentals across Shell has been key to this approach. They provide

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The number of Tier 1 and 2 operational process safety events practical steps to improve safety culture and achieve our Goal Zero
decreased from 130 in 2019 to 103 in 2020, of which 34 were Tier 1 ambition of no harm and no leaks. They have also worked together to
and 69 were Tier 2. For comparison, there were 41 Tier 1 and 89 Tier 2 drive standardisation and simplification. The programme has a joint
operational process safety events in 2019. This is Shell’s best annual safety vision and includes 21 companies.
performance for combined Tier 1 and Tier 2 incidents since
implementing this industry process safety performance metric. In 2020, the contractor safety leadership programme focused on
worker welfare, mental health, digital technology, and Shell’s
In 2020, there was one significant process safety incident related to a refreshed approach to safety (see Our approach to safety), including
fire and subsequent equipment damage in the Shales business in ways to strengthen its implementation in 2021. Challenges posed by
Texas. The fire was caused by mechanical failure of a pump that COVID-19 were also discussed.
caused a release of lubrication oil that caught fire and damaged
several pumps. There were no injuries associated with this event. PREPARING FOR EMERGENCIES
We work to ensure we have the necessary resources to deal with
Process safety events related to sabotage and theft in Nigeria are spills, leaks, fires and explosions, both offshore and onshore. We
recorded separately. There was one Tier 1 event in 2020 compared regularly test our response procedures and capability so we can
with nine in 2019. respond rapidly to an incident. We recognise the need for urgent and
transparent communication with relevant stakeholders, such as local
Visit www.shell.com/safety for more on Shell and safety. authorities, in response to an incident.

Visit www.shell.com/process-safety for more on our approach to In 2020, COVID-19 restrictions made it difficult to run large-scale
process safety and full details of our approach to risk management, training in person. As a result, we accelerated our drive towards virtual
including the controls and physical barriers we believe are necessary support and new ways of working to maintain our response readiness
to prevent incidents. by, for example, using online collaboration tools.

RAISING SAFETY STANDARDS

Across the industry
We learn from others and share our safety experience and standards
with other operators, contractors and professional organisations,
including the International Association of Oil & Gas Producers (IOGP),
the Energy Institute and IPIECA, the global oil and gas industry
association for advancing environmental and social performance.

Shell employees and contractors connected virtually in 2020 as COVID-19

restrictions made it difficult to run oil spill exercises in person.

We trained around 500 employees and contractors on a large-scale

virtual oil spill exercise and several smaller exercises. These involved
businesses in Brazil, Canada, Qatar, Singapore, Trinidad and Tobago,
the UK and the USA and included oil spill scenarios related to our
shipping, offshore production, and refining operations. Exercises
involved our emergency response contractors, joint-venture partners,
and regulatory authorities to test our organisational capability to
We operate and charter helicopters and planes to transport staff and
contractors to facilities. manage a worst-case spill incident.

In the UK, we carried out a two-day simulation of an oil spill from an

In 2020, we continued to work with offshore helicopter safety offshore drilling operation that required the use of specialised
association HeliOffshore and the IOGP in a number of areas to drive equipment from local suppliers and from Italy, Norway, and
safer ways of working with aircraft. Together with aviation industry Singapore. The exercise involved around 200 people and tested
groups, helicopter operators, and other energy companies, we procedures to contain the release, such as deploying floating barriers
developed a common set of industry guidelines and best practices for and applying dispersant to the oil, and required working with freight
offshore helicopter flights. These include recommended improvements contractors and customs authorities.
such as warning systems with earlier hazard alerts.
We have worked with maritime authorities and emergency response
This work is designed to deliver a more consistent approach and a partners in Scotland, UK, to train local fishermen in oil spill response
stronger safety performance across the industry. methods, such as oil sampling and dispersant effectiveness.

With our contractors You can watch the training exercise that took place in March 2020 at
Since 2014, Shell executives have collaborated in pairs with www.youtube.com/watch?v=v3RKllZPcyg
executives of major contractor companies – as part of Shell’s
contractor safety leadership programme – to identify strategies and

26 Shell Sustainability Report 2020

 1. SUSTAINABILITY 2. OUR CORE 3. ACHIEVING 4. RESPECTING 5. POWERING 6. GENERATING 7. OUR
AT SHELL VALUES NET-ZERO NATURE LIVES SHAREHOLDER PERFORMANCE
EMISSIONS VALUE DATA

We also used our incident management system to help co-ordinate the tonnes (plus or minus 30%) of light gas oil at the Rheinland refinery in
evacuation of platforms due to COVID-19 and hurricanes in the US Germany, formed at some point between 2016 and 2019, with the
Gulf of Mexico, and to help around 2,000 seafarers stranded on volume established in 2020. We have agreed to a remediation plan
vessels to get home during the pandemic. with local authorities, which is currently being implemented, and are
publishing progress reports on the refinery’s webpage.
Spills
Shell has procedures to prevent operational spills. We also have There were 69 operational spills of more than 100 kilograms in 2020
routine programmes to maintain facilities and pipelines, to improve compared with 67 in 2019. We have programmes in place to reduce
reliability and to reduce spills. the number of operational spills over the long term.

But spills still occur for reasons such as operational failure, accidents or
sabotage. We investigate and learn from spills to improve our SPILLS – SABOTAGE [A] [B]
performance and aim to clean up the areas around operations that
are affected by spills, irrespective of the cause. 10 250

Spills performance
5 125

SPILLS – OPERATIONAL [A]

10 250 0 0
11 12 13 14 15 16 17 18 19 20

Volume in thousand tonnes (left axis)

5 125 Number of spills (right axis)

[A] Sabotage- and theft-related spills of more than 100 kilograms. We have updated some of
our historical figures following a review of the data.
0 0
[B] All sabotage- and theft-related spills occurred in Nigeria except in 2016 (0.001 thousand
11 12 13 14 15 16 17 18 19 20
tonnes).

Volume in thousand tonnes (left axis)

Number of spills (right axis)
The number of spills caused by sabotage and theft decreased to 122
in 2020 from 156 in 2019. The volume of these spills decreased to 1.4
[A] All spill volumes and numbers are for hydrocarbon spills of more than 100 kilograms. We
thousand tonnes in 2020 from 2.3 thousand tonnes in 2019.
have updated some of our historical figures following a review of the data. Sabotage and oil theft remained a significant cause of spills in the
Niger Delta, Nigeria.
The volume of operational spills of oil and oil products in 2020 was
Visit www.shell.com/process-safety for more on our emergency
0.4 thousand tonnes, an increase from 0.2 thousand tonnes in 2019.
response procedures.
This was partly due to an underground leak of around 0.3 thousand

27 Shell Sustainability Report 2020

 1. SUSTAINABILITY 2. OUR CORE 3. ACHIEVING 4. RESPECTING 5. POWERING 6. GENERATING 7. OUR
AT SHELL VALUES NET-ZERO NATURE LIVES SHAREHOLDER PERFORMANCE
EMISSIONS VALUE DATA

SPECIAL REPORT

SPILL
RESPONSE AND
PREVENTION IN
NIGERIA
The Shell Petroleum Development Company of Nigeria Ltd (SPDC) pipelines and SPDC promotes alternative livelihoods through
produces oil and gas through its SPDC Joint Venture (SPDC-operated, entrepreneurship, employment and education programmes.
with Shell interest 30%). It operates a network of wells and pipelines
across the Niger Delta, a region of forest, farmland, rivers and In 2020, SPDC reduced the volume of operational spills of more than
marshes – the home to around 40 million people. 100 kilograms to about 0.02 thousand tonnes of crude oil (11
incidents) compared with about 0.03 thousand tonnes of crude oil
For decades, the region has been beset by crude oil theft, sabotage of (seven incidents) in 2019. This represents a year-on-year reduction of
pipelines and illegal oil refining. This results in oil spills, which cause around a third by weight.
harm to the environment and can damage people’s livelihoods and
Shell’s businesses. This illegal activity sometimes occurs in remote In 2020, more than 90% of oil spills of more than 100 kilograms from
areas of the Niger Delta and the SPDC JV can face challenges when it the SPDC JV’s facilities were due to third-party interference and other
comes to responding to incidents and accessing its infrastructure. illegal activities. The volume of crude oil spills of more than 100
kilograms caused by sabotage was 1.4 thousand tonnes (122
No spill is acceptable, and we work hard to prevent them. Over the incidents) in 2020 compared with 2.3 thousand tonnes (156 incidents)
last decade, the total number of operational spills in the Niger Delta in 2019.
has fallen significantly, from more than 60 in 2011 to 11 in 2020. The
SPDC JV has also made good progress in reducing spills caused by SPILL RESPONSE AND PREVENTION IN NIGERIA
third-party interference and other illegal activities. The combined
volume of third-party and operational spills in 2020 was at its lowest Spills in 2020
level in 10 years. SPDC continues to review its portfolio options for Number of operational spills 11
onshore oil in Nigeria. In the last decade, SPDC has reduced its Volume of operational spills 20 tonnes
licences in this area by half. Number of spills caused by third-party 122
interference and other illegal activities 91.7% of the total number
Frequent overflights, on-the-ground inspections and anti-theft
Volume of spills caused by third-party 1,438 tonnes
protection mechanisms, such as anti-tamper locks and steel cages with
interference and other illegal activities 98.6% of the total volume
CCTV for wellheads, all help discourage crude third-party interference.
In addition, closer community relations, the use of new surveillance Cle
Clean-up
an-up
equipment and improved collaboration with government security Two days in 2020,
Average days before joint
agencies have led to quicker, more effective interventions before improved from six days in
investigations commence
damage can be done. 2016
Five days in 2020,
Average days to complete the
improved from 13 days in
recovery of surface oil
2016
50 in 2020
Number of sites remediated
464 in total since 2016
Pr
Preevention
166 in 2020
Illegal theft points removed
689 in total since 2017
Steel cages installed to protect wellheads 364 in total
Breaches of steel cages in 2020 15 out of 1,706 attempts

SPDC operates to the same technical standards as other Shell

companies globally. Illegal activities, including third-party interference,
A team in Shell Nigeria hold one of their spill response and remediation and their legacy continue to require additional work and security but
review sessions. the SPDC JV is able to safely produce oil and gas, limit spills – in
number and size – and respond quickly if they do occur.
SPDC has also implemented several local initiatives and partnerships
to address the underlying causes and raise awareness of the damage Regardless of the cause, SPDC cleans up and remediates areas
caused by breaking pipelines and crude oil theft. For example, impacted by spills that come from its facilities. In the case of
communities are awarded contracts to monitor the company's operational spills, SPDC pays compensation to communities affected
by the spill. Once the clean-up and remediation are completed, the

28 Shell Sustainability Report 2020

 1. SUSTAINABILITY 2. OUR CORE 3. ACHIEVING 4. RESPECTING 5. POWERING 6. GENERATING 7. OUR
AT SHELL VALUES NET-ZERO NATURE LIVES SHAREHOLDER PERFORMANCE
EMISSIONS VALUE DATA

work is inspected, and, if satisfactory, approved and certified by The first phase, removal of free-phase surface oil, was completed in
Nigerian government regulators. August 2018 and the contract procurement process for phase two,
remediation of soil, was completed in 2019. Remediation activities in
For operational spills, local communities take part in the remediation the field started in November 2019 and were due to be completed by
work and, despite the restrictions of COVID-19, this collaboration mid-2021. In 2020, the project was shut down for around seven
continued in 2020, although on a smaller scale. SPDC has months due to COVID-19 restrictions. Phase two remediation is now
collaborated with the International Union for Conservation of Nature expected to be completed in 2023.
(IUCN) since 2012 to enhance remediation techniques and protect
biodiversity at sites affected by oil spills.

EXTERNAL VOICE

RACHEL ASANTE
IUCN

Rachel is a biodiversity expert at the International Union for the

Conservation of Nature (IUCN), which brings together
The SPDC remediation and oil spill response team help clean up and
government and civil society organisations interested in remediate areas impacted by spills.
conserving nature and accelerating the transition to sustainable
development.
Clean-up in Ogoniland
“A conservation organisation and an oil company are not SPDC is working with the relevant stakeholders to implement the 2011
natural bedfellows. But we have worked together to find some UN Environmental Programme (UNEP) Report on Ogoniland, where
technical solutions to a difficult issue. We’re instituting an SPDC has not produced oil and gas since 1993. The clean-up efforts
advisory group, which is made up of both Nigerian and are led by the Hydrocarbon Pollution and Remediation Project
international scientists, and which is working with the company (HYPREP), an agency established by the Federal Government of
to ensure that remediation standards are best practice. Nigeria. For more information on the activities of HYPREP go to
hyprep.gov.ng
“SPDC approached the IUCN about getting some support in
areas of remediation and biodiversity recovery. It’s been a SPDC has taken action on all of the UNEP recommendations
fruitful collaboration and we have managed to build trust. We addressed specifically to it as operator of the SPDC JV. SPDC has
have learned from SPDC and they have learned from us. We've completed most of these recommended actions.
managed to come to a common understanding which is critical.
The UNEP report recommended the creation of an Ogoni Trust Fund
“We are monitoring the spill sites but we're also monitoring with $1 billion capital, to be co-funded by the Nigerian government,
reference sites so that we can establish an environmental the SPDC JV and other operators in the area. The SPDC JV remains
baseline. This project can contribute to what needs to be done fully committed to contributing $900 million to the fund as its share
in the Niger Delta. It’s not a panacea that will solve all the over five years. Since July 2018, the SPDC JV has contributed
problems of oil spills in the Niger Delta, but I hope it can be $360 million.
part of a larger solution.”
Nigerian litigation
In March 2021, Shell and four former employees were acquitted in a
Clean-up in Bodo long-running trial in Milan related to a Nigerian oil block called OPL
In 2015, SPDC and the Bodo community signed a memorandum of 245. Shell has always maintained that the 2011 settlement with the
understanding granting SPDC access to start cleaning up areas Federal Government of Nigeria and Eni that was at the heart of this
affected by two operational spills in 2008. The clean-up process is trial was a legal transaction, so we welcome the ruling. This has been
overseen by an independent body called the Bodo Mediation a difficult learning experience for Shell. Business integrity is one of our
Initiative. Two contractors were selected to conduct the clean-up, core values and we continue to work hard to raise standards in this
overseen by an independent project director. The clean-up project area. You can read Shell's detailed response at www.shell.com/shell-
initially suffered delays due to difficulties in accessing the sites and comments-on-the-verdict-from-the-milan-tribunal-over-opl-245
disputes between communities.
More details on spill prevention and response in Nigeria can be found
at www.shell.com.ng/environment and www.shell.com.ng/oil-spills

29 Shell Sustainability Report 2020

 1. SUSTAINABILITY 2. OUR CORE 3. ACHIEVING 4. RESPECTING 5. POWERING 6. GENERATING 7. OUR
AT SHELL VALUES NET-ZERO NATURE LIVES SHAREHOLDER PERFORMANCE
EMISSIONS VALUE DATA

TRANSPORT SAFETY and moving more products by pipeline in South Africa. In India, this
Moving large numbers of people, products and equipment by road, resulted in a reduction of around 21% of the distances being driven.
rail, sea, and air poses safety risks. We develop best-practice
standards within Shell and work with others, such as specialist In Pakistan, we continued to implement learnings from a tragic roll-over
contractors, industry bodies, non-governmental organisations, and incident that occurred in 2017. Our focus has now moved from
governments, to reduce transport safety risks. technical standards to driver professionalism, including aspects such as
fitness to work, training, and coaching on the job. Shell Pakistan
At sea Limited is managing fatigue on the road through the creation of
In our maritime business, we are working with our contractors to enhanced awareness of this topic, reduced duty hours, and better
improve the quality and consistency of their safety management. This rest facilities.
includes developing more effective virtual tools to reduce physical time
spent on board carrying out vessel audits, which proved crucial in Visit www.shell.com/transport-safety for more on our approach to
2020 during COVID-19 lockdowns. transport safety.

This work involved creating a virtual programme to verify that safety PRODUCT STEWARDSHIP
initiatives implemented for vessels meet Shell’s standards. We worked We work to ensure our products – such as fuels, lubricants, and
on this programme with around 80 maritime officials and 450 chemicals – are safe throughout their life cycle. Our goal is to protect
contractor partners, and carried out more than 400 safety coaching employees, customers, communities, and the environment from
sessions with mariners. potential risks posed by these products and to comply with relevant
laws such as chemicals management laws.
In the air
We operate and charter planes, helicopters, and drones for tasks such We follow internal risk assessment processes to identify and manage
as monitoring pipelines, conducting geophysical surveys and our products’ potential health, safety, and environmental risks. In
transporting passengers and equipment. Despite the COVID-19 2020, we carried out more than 700 risk assessments for products
disruptions to commercial air travel, Shell staff and our contracted and additives. We also published and distributed around 100,000
operators continued to keep our air transport services running and to safety data sheets to customers in about 160 countries.
serve our customers across the globe. In 2020, our owned and
contracted aircraft flew around 52,000 hours and safely delivered We aim to ensure that products classified as dangerous goods are
around 554,500 Shell employees and contractors. safely packed and transported according to local and
international regulations.
Shell’s own aircraft were used to fill gaps in commercial services
globally, including evacuating families from high-risk countries and Circular economy
rotating critical workers such as our shipping crews. We are preparing for regulations and requirements that aim to create
a more circular economy, such as those arising from changes to
On the road European Union directives on waste. A circular economy is based on
In 2020, Shell employees and contractors drove around 470 million the idea that things are designed to last longer and to be reused,
kilometres on business in more than 70 countries. There were no road- repurposed, or recycled.
transport-related fatalities in activities under the operational control of
a Shell company in 2020. In 2020, we continued to strengthen our capabilities in this area; for
example, by appointing a dedicated waste adviser to our product
We take steps to continually improve our road safety performance stewardship team. We also have internal health, safety, and
such as implementing best practice, encouraging safe behaviours, and environmental standards for recycling used oil back into useful motor
calling for safe vehicle design. We run road safety programmes, oils for the market.
including our mandatory defensive driving course that teaches safe
techniques and behaviour. In 2020, around 20,000 Shell employees Plastic waste
and contractors completed some form of in-vehicle or virtual defensive Increasingly, we use plastic waste as feedstock at our chemical plants
driving training. (see Plastics). In 2020, our product stewardship team worked with
suppliers on assessing risks and assuring regulatory compliance to
Fatigue is one of the most significant risks when on the road. In 2020, enable them to enter the growing circular feedstock market.
at the Shell-operated QGC facility in Australia we worked with four
world-class universities and eight contracting companies to evaluate We engage with regulators about the safe and sustainable use of
fatigue detection devices to find the one that performed best in expert chemicals to inform and build trust in the chemicals industry. In 2020,
testing. The collaboration was the largest of its kind and involved we contributed to the American Chemistry Council sustainability
evaluating around 100 devices on long stretches of Australia’s road metrics review and the European regulatory agency’s chemicals
network. We aim to start using recommended devices in Malaysia management review. We provided information on data quality and
in 2021. completeness to the European agency in response to concerns from
regulators and wider society.
In 2020, we also continued to roll out our road transport risk
management initiative focused on countries where road transport is a Visit www.shell.com/product-stewardship for more on our approach to
high risk. We took steps to reduce driving time by constructing new product stewardship.
supply points in India, Mexico, Pakistan, the Philippines and Russia,

30 Shell Sustainability Report 2020