Shell Sustainability Report

08 May 2009 | News story

Shell released its 2008 Sustainability Report today. IUCN has worked with Shell on various biodiversity related projects over the past ten years and notes positively that Shell’s reporting on sustainability in general has steadily improved over recent years, with increasing detail and transparency.

IUCN hopes that this trend will continue, although we will actively encourage Shell to include more on biodiversity related activities and results across their businesses in future sustainability reports.

Protected areas

IUCN is pleased that Shell has abided by, and reaffirmed, its commitment not to explore or develop oil or gas fields in natural World Heritage sites. IUCN will continue holding Shell to this commitment, originally brokered by IUCN in 2003, and investigate expanding it to other types of protected areas, as called for by our member organizations.

Renewable energy investments

The report affirms Shell’s decision, as primarily an oil and gas company, to focus investment on biofuels and to halt future investment increases in wind and solar energy, as announced earlier this year. It should be noted that Shell expects to maintain its current (admittedly small) investment levels in renewable energy and to not reduce them in the current economic recession.

Focusing on biofuels for transport may well be a good business decision for Shell in the short term. However, societies around the world must move to energy sources and consumption patterns with radically reduced carbon footprints. Moreover they must be more equitable, have little or no impact on biodiversity, and value goods and services from nature – in particular those used to make energy. For example, we are already seeing developments to supply energy for transport based on electricity rather than liquid forms.

Making difficult business decisions in tough economic times is understandable, but leading oil and gas companies such as Shell should be taking a broader, long-term leadership role in the development of renewable and sustainable energy sources. IUCN hopes that the company re-assesses its energy investment portfolio in the near future.

See also the last update about this on the IUCN website.

Biofuels

IUCN encourages prudence in biofuel development. Well managed biofuel cultivation and production can provide incentives for biodiversity conservation, promote rural development, reduce dependency on fossil fuels, and provide lower carbon energy alternatives.

However many types of biofuels, particularly based on current generation technologies, pose risks to biodiversity, ecosystems and livelihoods – through deforestation, soil erosion, water pollution and heightened risk of invasive species, as well as through indirect impacts such as effects on land use and food security, and increased greenhouse gases.

Hence Shell’s focus on biofuels makes it even more important that IUCN continues its work with the company on making biofuels more sustainable through the development of robust standards, regulatory frameworks and practical tools. This applies to biofuel sources developed by Shell, and the wider biofuel sector.

In particular, the Roundtable on Sustainable Biofuels is a multi-stakeholder initiative in which both Shell and IUCN are active members. The Roundtable has recently released draft principles and guidelines for more sustainable biofuel developments. IUCN and Shell are hosting a joint workshop at the end of May to identify practical tools and approaches for implementing such principles and good practices along a biofuel value chain.

Oil sands

IUCN, and many of our member organizations, would prefer that oil not be extracted from oil sands because of the high amounts of energy, carbon and water used in extraction, and the relative inexperience with ecosystem rehabilitation following mining.

IUCN works with Shell in various places and operations around the world. The choice is primarily dependent on the level of impact IUCN can have in changing Shell’s operations to enhance positive, or reduce negative, impacts on biodiversity, and how this can ultimately drive change in the wider sector. IUCN does not work with Shell on any oil sands related projects.

Nigeria

The environmental and social impacts of Shell’s operations in Nigeria continue to be of concern to IUCN and many of our member organizations. We are however working with Shell on biodiversity issues in relation to their operations in Nigeria, with the aim of reducing its environmental footprint in that country.

The IUCN-Shell relationship

IUCN’s mission is to influence, encourage and assist societies throughout the world to conserve the integrity and diversity of nature and to ensure that any use of natural resources is equitable and ecologically sustainable.

Most societies include public, civil society and private sectors. Billions of people around the world work in the private sector, business is a key driver of social and economic growth, and business has enormous impacts on biodiversity. If IUCN is to influence societies, we must influence business.

The same principle applies to the oil and gas sector. Almost all societies have developed over the past century on the foundation of readily available and relatively cheap oil and gas. Despite the urgent need to address climate change, humankind is not going to stop using this type of energy tomorrow. IUCN therefore should try and influence the oil and gas sector in places where we can effect change.

As for almost all of IUCN’s business partnerships, we work with sector leaders who have demonstrated that they are open to, and will, change operations to reduce their impact on, or benefit, biodiversity.

While IUCN does not agree with everything Shell does, the company has shown a willingness to change its operations in order to reduce potential impacts on biodiversity, and to be relatively open and transparent about its sustainability engagements.

IUCN continuously assesses its relationship with Shell, the results we achieve, and the change we effect. If we do not continue to produce results, then the relationship will end.

IUCN and Shell do not agree on everything. But while there is some overlap in how both organizations see the future, and some overlap in how to get there, IUCN should work with Shell in places and on projects where biodiversity, and the humans that depend on it, will benefit.

For more information about the IUCN-Shell relationship, please visit www.iucn.org/business