Shell is a vertically integrated company where in upstream, it is engaged in exploration of crude oil and natural gas reserves, and development of projects through new technology. In downstream, it is engaged in refining, supplying, trading and transportation of crude oil worldwide…
It manufactures and markets a range of petrochemical products for industrial customers. The company is also engaged in delivery of technology solutions through research and innovation. Shell operates in 90 countries, employs approximately 93,000 people worldwide, 43,000 service stations, and has more than 30 refineries and chemical plants including 3.3 million barrels of gas and oil production per day. In 2010, the company spent $2.1 billion in development of alternate energy sources and carbon emission controls, $13 billion on purchases from companies from lower income countries, and more than $21 million on voluntary social investments (Shell, 2010). Shell Group is involved in the on-shore production of oil and gas in the Niger Delta. It is also involved in the offshore production of oil and gas in Gulf of Guinea and Nigeria’s first ever deep-water project. The energy from the Shell-operated Nigerian ventures is used for the country’s industrial and domestic use. The remaining is exported to Europe, US and Asia. Shell Petroleum Development Co. under the Shell Group employs about 90% of Nigerians in the region and provides 95% of the profits from on-shore production in the Delta to the Nigerian Government. The company also employs around 35,000 third party contractor staff (Shell-a, n.d.).
The Niger Delta is considered one of the most polluted regions in the world with around 6,800 recorded oil spill incidents in the last 50 years since the beginning of oil production in the region (Purefoy, 2010). In 2009, Shell’s Nigerian subsidy spilled around 14,000 tons of crude oil in Niger Delta, which were twice the 2008 figures and four times the 2007 data. The major reason is that many pipelines of Shell are corroded and old. The company has taken the responsibility of the clean-ups but blames the thieves and militants for majority of the environmental damages (Guardian, 2010). Since 1999, when Nigeria became a democracy, Shell has been trying to improve its image in the country by issuing the environmental reports every year. 1.2 Aims & Objectives of the Paper In the light of Shell’s operations in Nigeria and environmental issues associated with it, the aim of the paper is to: Identify and discuss the effects of the environmental issue on the major stakeholders of Shell in Nigeria, and the way each of the stakeholders responds to the problem. Compare and contrast the different approaches to leadership in bringing resolution to the problem based on several perspectives. From the discussion on the stakeholders’ perspectives and leadership perspective, it is expected to arrive at a practical solution to the environmental issues faced by Shell and Nigeria. 1.3 Scope of the Paper This paper has explored various stakeholder theories and models related to the case of Shell. Extensive analysis in stakeholder theory through numerous publications has been devoted to the understanding of the impact of Shell’ ...
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