Tuesday, January 06, 2009

Big Oil, Big Promises, the Environment and the Recession

George Monbiot, our favourite environmental journalist, interviews Jeroen van der Veer from Shell about advertising policy and alternative energy.

This article is typical of George and he goes for the jugular. There is a broader issue on "greenwashing" which is important. How much of CSR and "company greening" is merely window dressing? This is something I have covered in a couple of academic papers.

I have also often been amazed at the number of "green" adverts the oil companies put out on TV and in magazines. Given alternative energy is such a small percentage of what Shell actually does why is it given such prominence in the media. We know the answer but George drags it out to fill an excellent comment piece.

Over to Monbiot. I have included the full text as it is all worth reading.

It will take more than goodwill and greenwash to save the biosphere [Guardian]

For a while it seemed that Shell had stopped pretending. The advertisements that filled the newspapers in 2006, featuring technicians with perfect teeth and open-necked shirts explaining how they were saving the world, vanished. After being slated by environmentalists for greenwash, after two adverse rulings by the Advertising Standards Authority, Shell appeared to have accepted the inescapable truth that it was an oil company with a minor sideline in alternative energy, and that there was no point in trying to persuade people otherwise.

The interview I conducted with its chief executive, Jeroen van der Veer, broadcast on the Guardian's website today, contains what appears to be an interesting admission. I asked him whether Shell had stopped producing ads extolling its investments in renewable energy. Van der Veer does not express himself clearly at this point, but he seems to admit that his company's previous advertising was not honest.

"If we are very big in oil and gas and we are so far relatively small in alternative energies, if you then every day only make adverts about your alternative energies and not about 90% of your other activities I don't think that - then I say transparency, honesty to the market, that's nonsense." So, I asked, Shell did not intend to return to that kind of advertising? "Probably not," he told me. "I'm very much: keep your feet on the ground, tell them who you are and explain why you are who you are."

But since the interview was filmed, Shell's messianic tendencies appear to have resurfaced. In December the company ran a series of ads in the Guardian suggesting again that it had come to save the world. "Tackling climate change and providing fuel for a growing population seems like an impossible problem, but at Shell we try to think creatively," one boasted. It features a diagram of a human brain, divided into sections labelled "fuel from algae", "fuel from straw", "fuel from woodchips", "hydrogen fuels", "windfarm", "gas to liquids" and "coal gasification". This suggests progress of a kind, in that the company is acknowledging that it sometimes dabbles in fossil fuels, but its core business - oil - and its massive investments in tar sands extraction are missing from the corporate mind. Could Shell be having a senior moment?

The confusion deepens when you watch its latest publicity film. It's called Clearing the Air, and it does just the opposite. It is supposed to tell an inspirational tale of discovery, but the script and the acting are so gobsmackingly bad that it inspires you only to rip your clothes off and run screaming down the street. The lasting impression it leaves is that Shell's staff are chaotic and incompetent. Perhaps the clean-cut corporate clones featured in the ads of 2006 put people off.

Jeroen van der Veer is neither an incompetent nor an automaton. He is charming, friendly and smart. But he refused to answer some of the questions I had prepared.

Reading Shell's reports and publicity material, I kept stumbling on an absence. In 2000, the company boasted that it would be investing $1bn in renewable energy between 2001 and 2005. But since then it appears to have produced no figures for its renewables budget. The company now claims that it is "investing significantly in wind energy", but it doesn't say what "significantly" means. Of the 10 windfarms listed on its website, only one appears to be in the planning or development stage: the others are already in operation. Where is the evidence of new money? When Shell pulled out of Britain's biggest windfarm, the London Array, last year, did this represent the end of its major investments?

I asked Van der Veer a simple question - 15 times. (Only a few of these attempts feature in the edited film.) "What is the value of your annual investments in renewable energy?" He waffled, changed the subject, admitted that he knew the figure, then flatly refused to reveal it. Nor could he give me a convincing explanation of why he wouldn't tell me, claiming only that "those figures are misused and people say it is too small", and it "is not the right message to give to the people". It strikes me that there is only one likely reason for these evasions: that Shell's spending on renewables has fallen sharply from the figure it announced in 2000. It's a fair guess that the current investment would look microscopic by comparison to its spending on the Canadian tar sands, and would make a mockery of its new round of advertising. I challenge Shell - for the 16th time - to prove me wrong.

Nor would Van der Veer give me a straight answer to another straight question: "Is there any investment you would not make on ethical grounds?" I asked this six times. He was unable to furnish me with an example. It's not hard to see why. As well as exploiting the tar sands, which means destroying forest and wetlands, polluting great quantities of water and producing more CO2 than conventional petroleum production, Shell is still flaring gas in Nigeria, at great cost to both local people and the global climate. It has been fiercely criticised for its secret negotiations with the Iraqi government, which led last year to the first major access for a western company to Iraq's gas reserves. It is prospecting for oil in some of the Arctic's most sensitive habitats.

All this makes my question difficult to answer. Aside from the greenwash, it is not easy to spot the practical difference between this civilised, progressive company and the Neanderthals at Exxon.

Like all oil companies, Shell simply follows the opportunities. Shut out of the richest fields by state companies, struggling to extract the dregs from its declining reserves, it has been turning to ever more difficult oil extraction, some of which lies beneath rare and fragile ecosystems. When the price of oil was high, it announced massive investments in the tar sands. Now the price has dropped again, it has cancelled further spending. It has even less of an incentive to invest in renewables. Shell does what the market demands.

I don't blame Shell or Van der Veer for this: they are discharging their duty to their shareholders. I do blame them for creating the impression that the company has a different agenda, and I blame governments for allowing them to drift into whatever fields they find profitable, regardless of the consequences for people or the environment.

On this issue Jeroen van der Veer and I agree. Oil companies, he says, should not seek to determine a country's energy mix: that is for the government to decide.

Saving the biosphere, in other words, cannot be left to goodwill and greenwash: the humanity of pleasant men like Van der Veer will always be swept aside by the imperative to maximise returns. Good people in these circumstances do terrible things. Companies like Shell will pour big money into alternative energy only when more lucrative or immediate opportunities are blocked. Where is the government that is brave enough to block them?


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