Royal Dutch Shell Group was one of the first multinationals brave enough to set up a feedback facility on the Internet some years ago for its stakeholders and the public to engage in open debate about its activities: the "Tell Shell Forum".
Unfortunately Shell has more recently lost interest in the discussion forum; it has not replied to a posting since June.
The following are extracts from a posting on Tell Shell in 1999 by Claire Harris of Shell International which reveals what Shell originally had in mind for the forum and the basis on which it would be operated.
Date: November 16, 1999 02:07 PM
Author: Clare.E.Harris (Clare.E.Harris@SI.shell.com)
Subject: Our experiences with the internet dialogue
This forum is an uncensored space in which we want to hear your views about a variety of issues and about our approach to them. We created this forum so that people all over the world could have a conversation about these things and so that we could gain a better understanding of what your views are. If you see a couple of the early postings in the 'engagement and open communication' thread you'll see that a choice needs to be made about censorship - yes or no? And if yes, how much? We opted for the completely uncensored option. Our senior management have been very supportive of this forum and the openness of the debate. I believe people want to have open honest conversations with real employees and not with an anonymous helpdesk that dispenses a standard form letter.
Unfortunately the intended internet interface for open debate between Shell, its stakeholders and customers, has withered away. It is now nothing more than a Shell themed blog site dominated by three of four regular contributors (including the author of this article) who account for over 70% of all postings on the general forum.
To make matters worse, the discussion forum is no longer even accessible on individual Country websites e.g. the "Tell Shell" feature on the website of Shell Oil Company in the USA is reliant solely on email correspondence.
Shell’s attitude towards censorship on the Tell Shell Forum also seems to have changed dramatically. Glasnost has given way to censorship. Shell is also currently facing in two directions at once in regards to the issue of free speech on the Internet.
The following is a description of the Tell Shell Forum given by the Royal Dutch Shell Group in a legal document submitted by Shell International Petroleum Company Limited (The "Complainant") to the World Intellectual Property Organisation in proceedings launched by Shell in May 2005 against the author of this article: -
"Tell Shell Forum" is a facility set up in November 1998 to promote feedback from customers, shareholders or any other interested parties on topics and issues relating to Shell, and to enable the Complainant to respond to public concerns and criticism in an open and transparent way."
In fact, as already indicated, Shell is no longer responding at all.
The Tell Shell Forum has no doubt been badly undermined by the flow of negative news about Shell resulting from the reserves fraud and other scandals e.g. the staggering $16 billion cost overrun on the Sakhalin2 project in Russia (now $26 billion).
In the same document, Shell International made the following statement about the author of this article (and co-owner with his son, John Donovan of the "site" ShellNews.net): -
"The... Group... have been aware of the site since the beginning and whilst they would not endorse or agree with many of the comments made by the Respondent on the website, they have taken the view that the Respondent is entitled to express his opinions and to use the Internet as a medium for doing so."
This endorsement of the right to free speech on the Internet, even if it is critical of Shell, is supported by the following extracts from postings since 1999 by Shell on the "Tell Shell Forum. The relevant postings can be accessed in their entirety on the Tell Shell Forum archive (select 2002).
Date: April 23, 1999 11:16 AM
Author: Clare Harris (Clare.E.Harris@SI.shell.com)
Subject: Uncensored forums
I think it's very good that these forums are uncensored (as you've just proved) and I know that it's a matter of debate whether they should be uncensored or not. Your choice of words makes the argument for truly open discussion more difficult to defend. As you can probably imagine schoolchildren etc. use this site and I would find it very disappointing if we had to censor the material because of entries like this. Nevertheless thank you for your posting. I hope that you'll continue to use the forum (but in the spirit that it was intended - for open and frank discussion about issues that are relevant and using language that is suitable for all). Regards, Clare
Date: June 07, 1999 03:49 PM
Author: John Hofmeister, Director of Human Resources
Subject: Communications within Shell
However, let me say that I strongly believe the people in Shell have an enormously valuable contribution to make to the key debates, and that the Group's leadership is working very hard to promote open and honest communication within Shell, as well as with our external stakeholders. We genuinely do welcome all comments, positive and negative. We also believe that employees must be able to speak out without fear of rebuke or retribution. This website is in itself evidence that we are interested in seeking your views and willing to listen and respond.
(John Hofmeister is now President of Shell Oil Company in the USA)
Date: March 24, 2000 02:29 PM
Author: Shell International Ltd
Subject: Response to Joe Bloggs
Yes, indeed Shell do find their online forums of value. Also, having completely uncensored forums - which these are - increases our transparency and allows us to see what the issues are. Of course, when they are properly used, the forums allow people - both within Shell and outside - to have useful debates. It was, I have to add, never meant to be a "question and answer" tool - we have an e-mail facility for this. In saying that, however, I agree with some of the postings which say that not enough queries are responded to via the forums but this is something which we are trying - and I believe succeeding - to get better.
However, despite past rhetoric, Shell has given up the two way dialogue and has resorted to censorship and suppression. The Tell Shell Forum Terms and Conditions (which few people would ever bother to read) now reserve the right to: -
"…remove or otherwise block any material posted. In particular, Shell reserves the right to remove any comments that Shell deems as being either libellous, blasphemous, obscene, constituting racial abuse, may infringe intellectual property rights or are otherwise objectionable…"
In 2004 Shell removed postings from the Tell Shell Forum. Since they were not blasphemous or obscene, and contained no racial abuse, Shell must have objected to the strong but well founded criticism of Shell management.
In August 2005 Shell once again resorted to censorship on the Tell Shell Forum but this time in a more insidious form. Previously, Shell had at least left a message indicating that a posting had been removed for legal reasons. This time Shell censored the censorship notice: a posting made by a disgruntled former Shell manager was removed without leaving any trace that it had ever been posted on the forum. I wrote an article on the subject under the headline: "Secret Censorship on Royal Dutch Shell "Tell Shell" Internet Forum". To read the relevant article copy and paste the entire URL address below into your web browser.
There is further evidence which demonstrates Shell’s two faced approach to free speech on the Internet. In 2004 eight Royal Dutch Shell companies collectively obtained a High Court Injunction and Restraining Order against its former employee of almost 30 years standing, Dr John Huong, in respect of his whistleblower articles published on my website. Shell even threatened him with imprisonment. I refused to remove the offending articles and on 19 October 2005 posted them on the Tell Shell Forum where, at the time of publishing this article, they remain on display - probably because no one from Shell bothers to visit the Tell Shell Forum anymore.
The following are extracts from the prohibited articles of Shell whistleblower, Dr John Huong: -
"…I have integrated my personal insights as seen from the perspective of a former Shell employee – a Shell geologist for almost 30 years - who was unfairly axed by Shell management. I was punished because I insisted on working within the ethical boundaries of Shell’s "Statement of General Business Principles" (SGBP) which is supposed to protect shareholder, national and other stakeholder interests.
"I have also written numerous times to Mr. Jeroen van der Veer and Mr. Malcolm Brinded, of the Shell Group and other senior management under the umbrella of the Royal Dutch Shell Group. All of these letters were ignored. How could Shell management treat me so despicably, so shabbily, after I had worked for Shell so loyally and with such diligence for almost three decades?
When I started with Shell all those years ago I was proud to be an employee of what I considered to be nothing less than the best company in the world; an internationally respected brand and an equally highly respected management. It is a matter of the deepest regret to me that the company has sunk so low with its management acquiring global notoriety for participating in a disgraceful scandal which ranks alongside the likes of Enron and WorldCom.
It is ironic: If only Shell management had abided by its own ethical code – the SGBP, the humiliating reserves scandal, the results of which will inevitably drag on for many years with the investigations and ruinous class action law suits, could never have occurred. As God is my witness, that is the truth.
I am finding it hard to come to terms with the con-artist mentality of a management which thought it could say one thing in speeches and advertising – pledging "Profits and Principles" - honesty, openness, integrity etc and actually get away and rewarded with doing the exact opposite.
My recipe for recovery: Every single member of Shell senior management who is implicated in or tainted to the least extent by the reserves debacle should do the honorable thing and resign immediately. That includes Mr van der Veer and Mr Malcolm Brinded. Royal Dutch Petroleum and Shell Transport and Trading should be merged into one unified company – Shell with a single management structure. It needs to have an entirely new management team and that will certainly have to think about EXCLUDING Mr. Jon Chadwick – consisting of individuals who have NO possible connection with past misdeeds and who possess the integrity and dedication essential to the considerable task of restoring Shell’s reputation; all of these ingredients are needed for a genuinely fresh start.
Only then would I be prepared to invest in Shell or to recommend anyone else to so.
Shell’s reputation is now an international disgrace and its credit rating has plummeted to a correspondingly all time low. Isn’t that an unbelievable departure from what we knew about the Shell Group? Have we switched to a parallel universe? Class action law suits by the bucket full; law suits by customers over tainted gasoline; revelations about Shell’s undercover agents engaging in covert operations against Greenpeace and many other worthy organizations on an international basis; Sir Philip Watts setting up a private force of 1400 police spies in Nigeria; like I said, unbelievable.
It is a surreal situation whereby Shell is publishing on its own website, the entire prohibited articles – every single word – which are the subject of Shell’s High Court Injunction and Restraining Order in respect of their publication on my website.
It was of course the height of hypocrisy for Shell to have pretended in the previously mentioned WIPO proceedings that it supports freedom of speech on the Internet without disclosing that it had already launched libel proceedings against Dr Huong for exercising his right to freely criticise Shell on the same website. (In fact the articles were published by me, not by Dr Huong.) Dr Huong will perhaps be surprised under the circumstances to read the invitation by John Hofmeister for Shell employees to "speak out without fear of rebuke or retribution". Dr Huong was dismissed for speaking out internally at Shell on a conscience driven issue.
Anti-Shell postings on the Tell Shell Forum have become so intense and profuse that nothing has been heard from the webmaster for several months. He or she is presumably hiding under a desk somewhere wearing a hard hat so as to avoid the bombardment of negative contributions, or has simply deserted the webmaster post under fire. The silence does of course completely undermine Shell’s various claims quoted above, about being able to "respond to public concerns and criticism".
The mixed signals and general disarray by Shell in relation to the Tell Shell Forum is symptomatic of the deep malaise of a Shell management in which the majority of board members of Royal Dutch Shell Plc – 11 out of 15 directors, including its Chief Executive, Jeroen van der Veer - are tainted by the reserves fraud and other scandals.
The "Tell Shell Forum" has a number of regular contributors including an articulate former Shell employee, "Richard", who believes in taking a balanced view when confronted with individuals like the author of this article who has strongly held opinions about Shell management. Richard has become to some extent a substitute webmaster in the absence of the official webmaster (if one still exists). Richard has recently appealed to another regular contributor, "Tippi", not to cease her postings on the forum as she has just threatened to do in protest at the lack of response by Shell to questions raised on Tell Shell.
In view of Shell management’s evident lack of interest in Tell Shell, why has it not closed the forum down? I can offer two explanations. Firstly, Shell is aware that I own the domain name "TellShell.org" and may set it up us a fully functioning forum if Shell closes the current one. Secondly, for legal reasons which I need not go into, if Shell ended the Tell Shell Forum it would weaken any future attempt by Shell to seize the dotcom domain name for Royal Dutch Shell Plc owned by me: royaldutchshellplc.com. Shell has already made one unsuccessful attempt via the previously mentioned WIPO proceedings.
The following recent exchange which I had with "Richard" forms the rest of this article and may provide an explanation as to why Shell has decided it best to say nothing on its own forum for "engagement and open communication". Perhaps it fears that any response by Shell to negative postings would encourage more of the same.
Reply to Alfred Donovan from Richard: 12/10/2005 12:29:25
You say: "we feel more involved and frustrated by the reserves fraud, bearing in mind that no one listened when we rang the alarm bells far and wide".
This is a bit rich. You imply that you foresaw the reserves fiasco (though doubtless you will argue that you were merely highlighting a culture from which it naturally flowed). Nothing in your 1999 letter to Queen Beatrix implied any foreknowledge on your part, so your "I told you so" rings hollow.
Most people by now are probably sick and tired of any discussion involving reserves recategorisation, though there is no doubt that the episode reflected really badly on those senior people who sought to bury the issue once it had emerged.
I suspect (purely intuitively) that one reason for Shell's non-compliance with the SEC's reserves reporting rules was that there was a feeling within the technical side of Shell that went "These SEC rules are archaic; we know better; seismic technology has moved on; our methods provide a better picture of reserves than those dictated by an organisation (the SEC) with a scant and antiquated grasp of petroleum engineering".
Arrogant certainly. Fraud? Well doubtless due legal process will answer that question in the fullness of time.
You also refer to the suffering of shareholders; this too is a bit rich. Over the short, medium, and long term RDS shares have performed pretty well in comparison with any normal benchmark. Those who bought just before the reserves recategorisation and then sold out just after deserve some sympathy, but all others have done just fine.
Reply from Alfred Donovan: Monday 24 October 2005:
Richard I do not think that Shell will be overly pleased with you in prolonging the debate on these sensitive matters. On my part, I am very happy to continue the discussion and respect your even-handed approach.
As to whether due legal process will ever be allowed to reach a conclusion on whether the scandal amounted to a "fraud", that is unknown at this time and unlikely based on events thus far. Shell lawyers have been able to intervene in civil and criminal proceedings by using shareholder funds to settle US class action litigation and pay $150 million (USD) in regulatory fines. Shell was able to persuade the US Justice Department that it would not be in Shell shareholder interests to pursue a criminal investigation on the basis that its shareholders have already suffered enough. Whether that decision is in the best interests of the wider shareholder community is questionable. The US Justice Department and other authorities are however still deciding on whether to bring charges or impose penalties against individual Shell directors responsible for the fraud.
Investigative reports have thus far been withheld from Shell shareholders e.g. we have only been allowed access to the Summary Report of Davis Polk & Wardell prepared for the Shell Audit Committee Executive.
Nonetheless, as you are aware, Christopher Cox, the Chairman of the US Securities and Exchange Commission which investigated the filing by Shell management (including by Jeroen van der Veer) of false hydrocarbon reserves figures, has deemed it appropriate to use the term "fraud". That is good enough for me. Added to that fact, Shell has not challenged that same blunt description used repeatedly in the BBC Money Programme broadcast in July 2004.
I had no prior inkling of the reserves debacle before the astonishing news broke in January 2004 and have never claimed or suggested otherwise.
However, for the record, Shell management was warned in 1997 by Dr John Huong, the then Shell Production Geologist for the multi-billion dollar Kinabalu Field project. He put into writing his deep moral reservations about providing information which would mislead shareholders over the reserves volume in relation to the computer reservoir engineering model for the Kinabalu Field. An internal Shell document in our possession contained the following question put to Shell by Dr Huong: -
"Do you want to tell your investors that the volume carried in the ARPR (Annual Review on Petroleum Reserves) is suspected because a change in reservoir work will be expected! How can we live a day with a free conscience by getting the money from our investors through the 502F when our depositional model work is in question?"
Like our general warnings about Shell management’s disregard of ethical norms, Dr Huong’s specific warning about the misstatement of hydrocarbon reserves was also ignored: his reward for reminding Shell about its own code of ethics was subsequent wrongful dismissal, humiliation and blatant infringement of his human rights, including his right to freedom of speech.
To say that we had merely highlighted a culture from which the fiasco flowed does an injustice to the scale of our warnings about a morally corrupt Shell management. We issued warnings via almost every known form of communication (other than drums and TV) and did so over a number of years.
On 17th March 1995, Shell circulated to the UK news media a press statement about my son and me. The following extract provides evidence from Shell about the scale of our warnings concerning Shell’s lack of business ethics.
Mr Donovan appears to have little faith in his company’s claims. Since initiating legal proceedings he and his father have adopted the unusual course of mounting a publicity campaign to ventilate allegations against Shell and members of its staff. Mr Donovan’s father has recently founded what he calls a ‘Shell Corporate Conscience Pressure Group’ to promote this campaign.
Mr Donovan and his father have written to the directors of Shell UK and its parent companies stating that they plan to outline the allegations against Shell and its staff to the company’s shareholders, the President of the Board of Trade, a number of publications and to ‘Internet’ users. They have also claimed that they intend to write to media and shareholders calling for the resignation of senior Shell managers, allege that they plan to write a book, have sent publicity material to several Shell locations in the UK and have attempted to assemble negative views of Shell from some retailers. Shell believes these actions are an attempt to sully Shell’s reputation with sensationalist allegations, in the hope that the company may be coerced into settling false claims.
We sued Shell for libel in respect of the above allegations. We withdrew the action in return for a financial consideration received from Shell worth £125,000. Shell UK subsequently settled our so-called "false claims" for £200,000 plus costs. We also received a formal apology from the then Legal Director of Shell UK Limited, Mr Richard Wiseman, on behalf of its Board of Directors, followed by a letter of apology from the Chairman and CEO of the company, Dr Chris Fay.
During the aforementioned campaign which Shell management found so distasteful, leaflets were distributed at Shell HQ offices in The Hague and in London, and at the Shell Transport AGM. They were given to thousands of Shell employees, Shell shareholders and visitors to Shell HQ buildings. We had a team handing out leaflets every week day.
As I am sure you have realised, my son John and I tend to be outspoken as far as Shell management is concerned (we have been adversaries of Shell for over a decade). For example, a leaflet distributed in 1998 was headed "WARNING - DO NOT TRUST SHELL UK". In the leaflet which appropriately displayed a photograph of Shell’s London HQ buildings flying a skull and crossbones flag, we accurately described Shell management as being "masters of double talk and double-dealing".
It might assist anyone interested in this discussion to read the two relevant paragraphs below from my letter to Her Majesty Queen Beatrix of the Netherlands, dated 1st March 1999 – the entire content of which is posted on ShellNews.net - AKA royaldutchshellplc.com (there I go again, baiting Shell).
"Despite a letter of apology for past misdeeds that we received from Shell UK Chairman, Dr Chris Fay, in 1996, Shell has continued to act in ruthless and flagrant breach of its own code of business ethics requiring honesty, integrity, and openness, in all of its dealings. After being cornered, Shell has admitted its association with outright deception carried out on its behalf by a sleazy undercover operator."
"Although it is highly obnoxious for a multi-national to act oppressively against small traders, as far as I know, such conduct is not illegal. It is however even more repugnant given the false image of ethical trading projected by the Statement of General Business Principles published by the Royal Dutch/Shell Group. Regretfully, in reality (based on our horrendous experience), there appears to be a culture of deception and cover-up deeply ingrained at the highest levels of Shell."
In addition we also sent letters to financial institutions, financial regulators, to every UK MP, to UK government Ministers, including the Prime Minister, to the Lord Chief Justice, the media, NGO’s, PIRC, the Advertising Standards Authority etc.
We also wrote to every director of Shell UK, Shell Transport and Royal Dutch Petroleum Company. The following is one such example: -
Sir Peter Holmes MC
Director, Shell Transport And Trading Company plc
23 April 1998
Dear Sir Peter
You may have read the report in last week's edition of the Financial Mail On Sunday regarding the High Court Writ I have issued against Shell UK Limited.
I attach for your information a copy of the current Marketing Week magazine, plus a document entitled The Don Marketing Saga. I also enclose a selection of letters that I have sent to Mr Moody-Stuart. I would also strongly recommend that you check out our Website at: www,don-marketing.com
You will discover that strenuous efforts have been made by Shell over several months to prevent important information from reaching you and your fellow non-executive Directors. The information has been known to Mr Mark Moody-Stuart for some years - he is fully "in the loop" regarding these extraordinary matters.
Efforts are now being made to prevent the same information from reaching the people who own the company - Shell Transport shareholders.
As Mr Moody-Stuart is aware, we have documentary evidence that shareholders who attended the 1996 AGM were deliberately misled on a matter raised during the AGM.
I am sure that you will be absolutely appalled by the information supplied, as would shareholders. It is clear that Shell's most senior management does not practice what it preaches i.e. honesty, integrity and openness in all of Shell's dealings.
We complained to the late Sir Peter Holmes about Shell’s undercover activity against us (which was admitted in writing by Shell after we had caught one such agent red-handed). We later discovered that at the time, Sir Peter Holmes and another titled Shell director, Sir William Purves, were the ultimate spymasters of a commercial espionage firm, Hakluyt, engaged in precisely the type of cloak and dagger activity we were complaining about. Both were simultaneously directors and major shareholders in Hakluyt and Shell. Many MPs believe that Hakluyt is the commercial arm of MI6. The Sunday Times cornered Shell into admitting that Hakluyt had engaged in covert operations involving deception, sabotage and spying activities on an International basis against Shell’s perceived enemies. So while Shell was engaged in a multi-million dollar global PR campaign trumpeting its undying commitment to openness and honesty, it was engaged in underhand activities involving secrecy and deception.
My son and I founded the Shell Corporate Conscience Pressure Group. Our membership included Shell suppliers, fellow Shell shareholders and Shell retailers – amazingly nearly 15% of Shell UK retailers joined the pressure group. Several hundred Shell retailers participated in our "business ethic" surveys about Shell. We published the results in successive monthly whole page notices in the gasoline trade press. All responses were opened under the supervision of an independent solicitor who provided an Affidavit verifying the results which, as can be judged from the information below, were devastatingly bad for Shell.
89% of respondents said that they would not recommend any petrol retailer considering a brand change to switch to Shell.
75% of the Shell stations that participated were of the opinion that Shell was unethical, incompetent, and greedy.
Shell never did take up our challenge to commission and publish the results of independent research, using precisely the same questions and offering respondents GUARANTEED anonymity.
We also received many letters from Shell stations complaining bitterly about the business practices of Shell. Here is a selection of quotes from some of the letters: -
"Extremely bad company"
"I believe the current regime is totally immoral"
"We have serious concerns about Shell’s ethical conduct".
In view of all of the above, I believe it is safe to claim that no individuals have ever shouted warnings and rung alarm bells as loudly or for as long as my son and I did about Shell management.
The amazing aspect is that some of the same hopelessly discredited senior management are still at the helm of Shell and warnings are still being issued about their current activities which are continuing to destroy Shell’s credibility and reputation.
While the maelstrom continues to whistle around their ears, Shell executives have been distracted spending time and money ordering a fleet of luxury jets presumably to visit Shell’s projects around the globe plagued by huge costs overruns.
I will say it again. The one and only saving grace for this Shell management has been the one element over which they have no control: the high price of oil.
*ABOUT THE AUTHOR: Alfred Donovan has had business dealings with Shell stretching back almost 50 years. In the 1980’s & 90’s the sales promotion company he founded with his son, John (Don Marketing) created and supplied multimillion dollar national promotions for Shell on an international basis. He and his son probably hold the world record for suing Shell, having subsequently brought a series of court actions: five for breach of confidence or breach of contract, and two for libel. They have never lost a case against Shell. Details about the litigation are published on ShellNews.net, the unique website owned by the Donovan’s. It contains the world’s largest collection of articles, news and reports focused on Royal Dutch Shell and its activities – astonishingly, over 6,000 web pages. Mr Donovan owns and uses the registration to the dotcom domain name for Shell’s unified $200 billion (USD) company: Royal Dutch Shell Plc (royaldutchshellplc.com). Shell made an unsuccessful attempt to seize it by instituting proceedings via the World Intellectual Property Organisation in May 2005. A WIPO panel gave a unanimous verdict in favour of Mr Donovan in August.
Disclaimer: 'The author (Alfred Donovan) ShellNews.net and the web site RoyalDutchShellplc.com are not endorsed by Royal Dutch Shell plc or affiliated with them in any way.'
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