Shell is not going to forget lightly its misadventures with the Brent Spar. The Oil Major was taken by complete surprise when the Greenpeace campaign against sinking that former drill platform achieved its goals. What happened to Shell can in fact happen to any corporation. Loosing control of the situation as result of the activities of a pressure group has become a nightmare scenario for the modern multinational enterprise.
Shell did too little too late. The Oil Major's first reactive measures have meanwhile become the
perfect example of how not to do it. But Shell has learned a lot as well. A
comprehensive review of what has become known as the PR disaster of the
century indicates that Shell had it all wrong about its own influence on
the media. There was a new factor in the game, which had been completely
missed out: the role of the Internet. That would not be allowed to happen a
second time. From July 1996, Shell International sports an Internet
manager. His name is Simon May, he is 29, and responsible for Shell
International's various presences on the Internet, and for monitoring and
reacting to what is being written and said about Shell in cyberspace. He
also helps formulating the Shell group's strategy for how the Internet
should be used.
May's career began in journalism, and more recently he did a four-year
stint in the Sultanate of Oman in charge of the English-language
communications for the state-owned oil-company. With him Shell's got a
premium catch: May is young and eager, smart and fast, open-minded and
nice, everything the image of the Company ought to be.
And he understands like no other the internet's potential--also what
it could mean for a company like Shell. Simon May openly admits that Shell
was beaten in the new-media war. The Brent Spar affair was one, but the
Nigeria situation has also prompted a "massive on-line bombardment" of
criticism. To quote May: "There has been a shift in the balance of power,
activists are no longer entirely dependent of the existing media. Shell
learned it the hard way with the Brent Spar, when a lot of information was
disseminated outside the regular channels."
The Brent Spar affair has brought quite some change of attitude to
Shell. Ten years ago the Multinational could afford to blatantly ignore
campaigns against the South African Apartheid regime. Although concerns
were brewing in-house, to the outside world Shell maintained that the
campaigns against Apartheid were not significantly damaging the Company.
And for the rest Shell kept haughtily mum. Then came the Brent Spar
incident and car owners were taking en masse to boycotting Shell's petrol
pumps, and such an attitude no longer paid off. Shell came to feel the
might of the mass market, and bowed down. An alternative would be worked
out for the platform's fate.
But developments did not stop there. A few month later opposition
leaders were executed in Nigeria as result of their attacks on the
environmental disaster Shell was causing in Ogoni-land, and this caused a
renewed storm of protest against Shell. The intimate links between Shell
and the military regime came under severe criticism. The Oil Major then
went for a new tactic and opened a PR offensive. CEO Cor Herstroter took
the initiative in a debate on politically correct entrepreneurship. At the
shareholders meeting in 1996 the new chart of business principles at Shell
was unveiled, a comprehensive code of conduct with due allowance for human
rights.
Does this all point out to a major shift in policies? Or are we
witnessing a smart public relation exercise intent on taking some steam
from the pressure groups' momentum?
In the beginning of June 1998, Brussels saw a conference devoted to
pressure groups' growing influence, organized by the PR agency, Entente
International Communication. Entente did research about the way
corporations were interacting with pressure groups and vice versa. The
findings, presented in a report titled "Putting the Pressure on" are harsh:
"Modern day pressure groups have become a major political force in their
own right, and are here to stay. They manifest themselves in the use of
powerful communication techniques, and they succeed in attracting wide
attention and sympathy, projecting their case with great skill via the mass
media--they understand the power of PR and of the media "sound-bite." And
now increasingly, they do so over the global telecommunication networks.
Their power and influence is bound to grow inexorably over the next years.
Pressure groups are small, loosely structured and operate without
overhead or other bureaucratic limitations, they move lightly and
creatively. They pursue their aims with single-minded and remorseless
dedication. To be on the receiving end of a modern pressure group can be a
very uncomfortable experience indeed, sometimes even a very damaging one.
Multinational companies are ill prepared to face this challenge, their
responses are often slow and clumsy. There is a "bunker" mentality, and a
reluctance to call in experienced help from outside which is surprising--
and potentially dangerous. This failure could cost such companies dearly in
the future.
At the conference in the SAS Radison Hotel in Brussels, attended by some seventy participants from the corporate world and the PR industry, fear for the unknown prevails. The unpredictable power of pressure groups, consumers, or even normal citizens can take the shape of boycott campaigns, but also of commuters on the (newly privatized) British Railways to move out from a train that has been canceled on short notice. The biggest question remains unanswered: whose turn will it be next? The Brent Spar affair has left its mark here.
By way of illustration the story of Felix Rudolph, an Austrian
national who worked himself up from farm hand on his father's estate to
manager of a factory producing genetically modified grain. Pioneer Saaten
("Pioneer Grain," the company's name) was not aware of doing anything
wrong. The company produces for a small market niche in Central Europe and
strives for optimal quality, so as to enable farmers to obtain better
yields. All products have been tested extensively, and all test results
have been duly registered.
So nothing to worry about, that is until the
company became the focus of a protest campaign, triggered by an impending
referendum in Austria on genetically manipulated foodstuffs. "We suddenly
had to engage in debate with the public, something we never had done
before. Who's interested in grains anyway?" Felix Rudolph, as he holds his
presentation at the Brussels conference, still looks dumbfounded about what
overcame him. "Your products are unhealthy and dangerous asserted the
pressure groups, and we had no clue what we had to say in return. As soon
as you try to explain the extent of a risk, you admit that such a risk
exists. In that referendum, 90 percent of the people turned out to be
against gene technology, the majority of whom did not know what they were
talking about."
It is only later that Herr Rudolph understood that his
company merely served as an example for the pressure groups. "By engaging
in a dialogue, we provided them with a platform to put forward their case.
The discussion itself went nowhere." This realization came too late,
however. The campaign so much impressed the government that it enacted laws
regulating genetically manipulated foodstuffs. An embittered Herr Rudolph:
"Now the farmers may foot the bill, and the pressure groups have vanished
into thin air!" Pioneer Saaten had to temporarily suspend the production of
modified grain. "We will try to explain things better next time we apply
for a license."
According to Peter Verhille from the Entente PR agency, the greatest
threat to the corporate world's reputation comes from the Internet, the
pressure groups newest weapon. "A growing number of multinational
companies--such as McDonalds and Microsoft--have been viciously attacked on
the Internet by unidentifiable opponents which leave their victims in a
desperate search for adequate countermeasures."
The danger emanating from the new telecommunication media cannot be
over-emphasized, says Mr. Verhille. "One of the major strengths of pressure
groups -in fact the leveling factor in their confrontation with powerful
companies- is their ability to exploit the instruments of the
telecommunication revolution. Their agile use of global tools such as the
Internet reduces the advantage that corporate budgets once provided." His
conclusions made a hard impact on the participants of the conference. In
fact most companies appear slow to incorporate such tools into their own
communication strategies. When asked what steps they planned to take to
match pressure groups mastery of these channels, most respondents simply
repeated their intention to expand into this area or admitted that their
preparations were still in a preparatory stage.
As came to light in Brussels, there is one exception to this picture
however: Shell international. Internet manager Simon May gave a smashing
presentation, which showed very well what Shell had come to learn about the
new media. Simon May was also very open in an interview we held with him
(befittingly, by email), even though he could understandably not answer all
of our questions.
Pressure on the Internet, Threat or Opportunity was the core issue at
his presentation. Internet may be a threat to companies, it also offers big
opportunities. Simon May states that the fact that anyone can be a
publisher cheaply, can be seen, or at least searched and looked at
worldwide, and can present his/her viewpoints on homepages or in discussion
groups is not merely a menace, but also an unique challenge. "Why are
pressure groups so active on the Internet? Because they can!"
Companies should do the same, he argues, but must do it
professionally. "On-line activities must be an integral part an overall
communication strategy, and should not be simply left to the care of the
computer department."
The basic tenet of the The Shell Internet site
(launched early 1996) was a
new strategy based on openness and honesty. Dialogue was the core concept,
and sensitive issues were not side-stepped. May is quite satisfied with the
results of this approach and illustrates this with some facts and
statistics.
The Shell Internet site receives over 1,100 emails a month, a full-time
staff member answers all these mails personally and within forty-eight
hours; there is no such thing as a standard reply. There are links to the
sites of Shell's competitors and detractors, and also to progressive social
organizations (nothing there more radical than Friends of the Earth or
Greenpeace, but this aside). Shell also allows opponents to air their views
in forums- those are uncensored. Not without pride, Simon May states that
Shell is still the only multinational to do this. There is no predetermined
Internet strategy at Shell, flexibility is the name of the game. "It's all
about being able to react, listen and learn." His advice to the Brussels
conference-goers: "Be careful, technology changes fast, and your audience
changes and develops even faster. And think before acting: anything you're
putting up on an Internet site you make globally available."
Taking care of Shell's presence on the web is only one of the Internet
manager's tasks. He must also monitor and react to what is being written
and said about Shell. "The on-line community should not be ignored" was
part of his advice in Brussels. "Pressure groups were aware of the
potential of the Internet far earlier than the corporate world. There are
pressure groups that exist only on the Internet, they're difficult to
monitor and to control, you can't easily enroll as member of these closed
groups."
Listening to the Internet community can be an effective barometer of
public opinion about your company. The Shell Headquarters in London are
making a thorough job of it. Specialized, external consultants have been
hired who scout the web daily, inventorying all possible ways Shell is
being mentioned on the net, and in which context. Things are not made
easier by the fact that search engines will assign forty-eight different
well-known uses of the word "shell"...
Simon May gladly explains how the work is done. "We use a service
which operates from the US, E:Watch, who scan the Web world-wide for
references to certain key words and phrases we supply to them. In the UK we
use a company called Infonic, who does the same thing from a European
perspective. The results they come up with can be completely different,
although they have been given the same search criteria, and the search has
been done at the same period of time. This can be for a number of reasons,
including the methods which they use to search, and the times of day they
enter a site to index it."
Shell also uses so-called intelligent agents. These are search
programs that can be trained to improve their performance over time. Simon
May: "This is particularly useful for us since our company name has so many
different meanings. We can tell the "agent" which results are useful and
which ones aren't, the next time the agent will go out and come back with
only those documents which are relevant."
This monitoring can not be for 100 percent truly effective, but has to
be carried out nonetheless, according to Simon May. "You need to keep track
of your audience all the time, since you may learn a lot from it."
Visiting the Shell web-site, the first surprise
is the measure of openness about issues previously wrapped in taboo. There
are carefully written features on human rights, the environment, and even
the devastation and exploitation of Ogoni-land in Nigeria. The somewhat
defensive character of some stories gives an indication as to which issues
are still sensitive. Speaking for instance of the massive oil spills in
Ogoni-land, for which Shell is held responsible ("totally exaggerated and
unproved accusations"), there is always the mention that 80 percent of
those have been caused by sabotage by radical resistance groups (this
percentage is contested by the groups concerned).
At the site's discussion forums arranged by subject everybody is
allowed a say about Shell's practices. It is ironic then to see Shell
collaborators from Malaysia and Nigeria reacting with dismay about what
they read in those forums about their employer.
The question is of course whether this form of openness really yields
results. The forums are not intended for people to question Shell; the
email facility is provided for that. "The forums are intended for people to
debate issues relevant to Shell among themselves, so to speak," says Simon
May. The email service is actually being used quite intensively to put
questions to Shell--these are the 1,100 emails coming in every month. What
the nature is of these questions, and the answer to these, remains between
Shell and the emailers.
All in all, one might conclude that this amounts to a fake openness, for show purposes only. After all, in public true discussions are being eschewed. But Simon May would deny that the forums are merely window-dressing: "We do believe quite firmly that people have the right to debate these issues and we provide a place where they can do that in an environment which might just lead to their view being heard in an organization that can make a difference." Of course these forums function as barometer for what certain people think, May admits, although this is not their primary aim.
At the Dutch office of Friends of the Earth these rather embellished representations of
reality do not cut much ice. "They've changed a lot in their communication,
they're far more careful about how they present themselves to the outside
world. But that is mostly addressed to their customers here, in the Western
world," says spokesperson Irene Bloemink. "Profits and principles, the
first issue of the totally overhauled Shell International Yearly Report,
has been only distributed in the Netherlands, Great Britain and the United
States. That's where the people are that Shell sees as a potential threat."
The situation in Ogoni-land has not improved in the two-and-half years
since Ken Saro-Wiwa was hanged; on the contrary, things have only gone
worse, at least till the death of the military dictator General Sani
Abacha. Scores of people have been arrested in the beginning of this year
by a special military unit, founded specially to "ensure Shell comes back
to Ogoni-land." This would at least suggest some kind of involvement. Yet
Shell has done nothing to stop the latest wave of arrests."
Adopting a code of conduct regarding human rights and the environment
is simply not enough. What counts is implementation and enforcement. Shell
has not in any way made clear how they intend to translate their good
intentions into concrete practice. There is no independent body to monitor
the implementation of the code of conduct. Shell is self-congratulating
about their first environmental Annual Report, which they claim, has been
thoroughly reviewed by KPMG Management Consultants. Shell considers this a
fully independent review. But then, KPMG"s environment CEO George Molenkamp
goes further in de Volkskrant (a Dutch daily newspaper) to say that
"accountants don't vouch as such for Shell's policies. Anything that comes
in the report is as Shell has decided." Some contradictory viewpoints, I
may say," says Irene Bloemink.
It is doubtful whether Shell has really learned anything from its
mistakes in Nigeria. There is a new Shell venture in the West African
country Tshad that looks as big as the Nigeria operation, and with the same
possible consequences. And everything seems to go wrong again. Shell joined
in a partnership with Esso and Elf (stakes are 40-40-20 respectively) and
intends to start drilling new oil fields in the unstable South of that
country. A report on the environment assessment came as an afterthought,
according to Friends of the Earth: the agreements were signed and test drillings had
already begun. The local population was informed of what was in store for
them as the invading oil-men were underway, and the operators came to the
villages to bring the news accompanied by a heavily armed military escort.
In March of this year, over a hundred civilians were killed by the army as
it tried to regain control over an area from the FARF separatist movement,
which in its turn highlights its own existence by attacking this oil
project. The FARF claims that the earnings of the oil production will
exclusively benefit the presidential coterie in the North.
Until now, Shell has been hiding itself behind Esso as the local
executive partner responsible for external relations, and has declined to
engage in public debates on the subject. Even Simon May doesn't want to
burn his fingers on the Chad issue. Not yet, that is.
[Translated by Patrice Riemens, and edited by Renee Turner.]