Social Intangibles of Shell Operations - Case Study Example

Social Intangibles of Shell Operations Student’s Name: Instructor’s Name: Course Code: Date of Submission: Introduction Shell Company is one of the leading global companies in energy sector having been established over 100 years ago as a small shop in London. Currently, the company has opened up many retail branches in different parts of the world. The company objective is to engage positively and in an efficient manner in developing energy related products like oil and gas and also engage in developing other sources of energy. After making important strides in the energy sector, like many other corporations, Shell Company has also an obligation to check and make sure that it’s responsible in its social activities. While the company is geared towards supporting economic growth and development, at the core of the company, it remains that social concerns are addressed in order to help the communities involved benefit and remain protected. This is to the ensure sustainability of the business a time like this when the consumer is becoming very cautious on the activities of corporate bodies (Castka and Bamber 2004). It is therefore important to note that this analysis will tackle the various behaviours, actions and communications of the company in reference to social development. The ultimate aim is to help unfold the impact of the company to the social environment in which it’s operating. Social intangibles The environment is a very important aspect of any given company and this is because it is in the environment that the business is being run and all resources both raw materials and labor are fetched from. It therefore becomes absolutely very necessary for any company that wants to remain profitable and sustain itself into the future. This is especially important in an environment where the resources are becoming very scarce and need to be used for to benefit the current generations and the future ones. While different companies are seeking different means to increase efficiency and productivity, technology is now playing a central role in helping in that aspect. For instance, new and highly advanced technology is used alongside other new ways of doing business and partnerships to help manage the environment by reducing the negative impact on it while trying to meet the energy needs of the community (Grayson and Hodges 2002). While the demand for energy is expected to double by 2050, the challenge that is likely to persist and pose a great risks to the environment, CO2 emissions which are likely to cause serious effect to the climate. Because high carbon emissions are likely to pose a very big threat to the climate, Shell Company has been on the verge to help reduce the risk. It is estimated that one-third of the CO2 discharged to the environment from the energy systems, originate from the process of generating electricity and therefore it has remained very critical to manage the emissions that take place in the sector as one way of helping averting serious damage that can be caused to the climate. The company is anticipating that by replacing coal with natural gas, the CO2 emissions could easily be reduced by 50% and this is a process that needs to start immediately. It is on this ground that the company has engaged more than ever before in the production of natural gas as opposed to electricity as one way of unlocking new resources (Shell Global 2013a). Protecting the biodiversity is one of the many social responsibilities that corporate bodies are obligated to do. While apply this approach Shell has continued to work with different conservation experts and appropriate technologies in order to lessen the impact of the company activities to the lives of many living organizations including human beings. While protecting biodiversity remains a critical activity for any corporate body, the challenge that has continued to persist for many, is the approach to use in lessening the impact of companies’ activities. However, Shell has never remained reluctant in dealing with this challenge. Biodiversity is treated as a very important factor that will always affect the company production activities especially when the company wants to expand. The protection of biodiversity according to Castka and Bamber (2004) is part of the corporate social activities and should always be anchored in the company governance policy. It is this reference that Shell has chose to integrate biodiversity protection into its operations and this is founded on the industry-standard of 2001 and now has been incorporated into the company’s biodiversity manual. The company’s biodiversity program is wide and it tends to include new projects, action plans and also collaborating with experts to work towards protecting rich and very delicate eco-systems. This kind of approach by the company has been very positive in the sense that it has helped reduce the decline of about 200,000 plant and animal species that are considered vulnerable in the IUCN Red List of the threatened species of 2012. For the company, this initiative is important since it helps the company contribute positively to the society as it’s seeks to get regulatory and acceptance approvals by other stakeholders and business partners (Porter and Kramer 2004). The company has also been working hard to make available energy as a very important commodity for enhancing economic growth development. This is to say that the company is taking very seriously the social concerns of the company operations and how do they improve the lives of local communities while protecting the company reputation and building support for the business. The company projects geared towards facilitating both economic and social growth to the affected communities through the creation of jobs and investing in different projects within the community. The community in which the company operates is considered as a neighbor who deserves fair attention. It is from this perspective that Shell Company has embarked on a journey to do all it can in order to remain a good neighbor with the community. This is the reason that the company has gone a step further to invest in different projects which have been integrated into the company into the company operations (Shell Global 2013b). However, despite all these efforts some of the company operations, activities and behaviors, have continued to impact negatively on the community in many different ways. Some of the areas that the company has done little to help and is expected to intervene and sort out the negative impact it causes to the community the livelihood, lifestyle, health, security, safety and economic development of the people in the neighboring communities. For instance, in the case of the livelihood, in some occasions, the operations of the company require that there be some expansion of facilities. The effect of this to the community is that people may be forced either to relocate temporary or permanent from the places where they have either been working or living (Grayson and Hodges 2002). While such projects that demand for relocating of people takes place, it becomes absolutely necessary for the company to remain in charge and help secure a good place for the people to reside in. However, this could not be that satisfactorily as it will take some time for the people to settle down. If for example, previously some people owned businesses, it might be difficult to start and nurture business in a new environment (Porter and Kramer 2004). In essence, this is serious destabilization of the people’s lives. On the other hand, health has continued to be one of the many negative effects the company activities are causing into the environment and the people living there. For instance, while building different facilities, there is a possibility that mosquito-breeding points are likely to be created and the end result will be, endangering the community for getting infected by malaria (Shell Global 2013b). In addition, to this Shell is a global company and it’s uncommon that it will not have transfer of its work from one place to another. In a scenario, where people employees have been moved from one country to another, there is that risk of introducing some new and infectious diseases like HIV/AIDS, SARS, Ebola and many more. Even though the company for example in its major refinery and chemical plant in Louisiana has set up a facility to monitoring air contamination levels and take necessary initiatives, it still remains that people are being faced with the threat of contaminated air which could be very harmful to lives. The other areas as mentioned above and that have remained a threat to the community include safety and eroding of culture and lifestyle in the communities in which the company operates in (Castka and Bamber 2004). to start with, in the case of safety, people living close to the company refineries have continued to raise concerns over the safeness of the company facilities. For instance, the facilities given the nature of operations are vulnerable to fire outbreaks. Congestion is also likely to occur in places where the company has its facilities because of numerous tankers ferrying the commodities. Finally culture of certain communities is highly threatened and this is so because the company has been importing from different cultures with different traditions and values and the end result is the rising of a culture that is quite different from the local one. Further on this, people from different parts of the world have different abilities t standards of lives they lead and this may lead either to rise or decline in the cost of living depending on the hosting country and the country of origin. Conclusion This analysis has established major underlying issues that can be related to the effects of a corporate activities and behaviors to the community. The exercise has based its analysis on Shell Company which is one of the leading energy companies in the world. As a whole, the analysis has looked at the social intangibles of the company activities and operations to the community. What is emerged is that while the company activities have continued to pose very serious challenges to the social lives of the communities in which it operates in, the fact remains that it is contributing positively to the community through the development of infrastructure and also in the protection of biodiversity. In general what has transpired in this analysis is that it remains absolutely difficult to remain positive in every aspect and therefore a fair balance between the company operations and the effect to the society, must be struck within the company policy to sustain stable relationship between the company and the community. Reference Castka, Bamber, and Bamber, D. Sharp. “Integrating corporate social responsibility (CSR) into ISO management systems – in search of a feasible CSR management system framework.” The TQM Magazine 16, no. 3 (2004), 216-224. Grayson, D. and Hodges, A. Everybody’s business (New York: Dorling Kindersley, 2002), 34- 76. Porter, Michael and Kramer, M. “The competitive advent age of corporate philanthropy.” Harvard Business Review (2004), 57-68. Shell Global. Our impact on local communities, (2013), http://www.shell.com/global/environment-society/society/ourneighbours/impact.html (accessed April 4, 2013). Shell Global. More natural gas for electricity generation. (2013), http://www.shell.com/global/environment-society/environment/climate-change/natural-gas.html (accessed April 4, 2013). Read More