The Moment Environmentalists Forced A 'Sea Change' At Oil Giant Shell

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In this DeSmog UK epic history article we tell the inside story of how the rising tide of environmentalism in the 1990s caused a โ€œsea changeโ€ at oil behomethย Shell.ย 

The environment movement in 1997 appeared at its most confident and confrontational.ย In Britain, Greenpeace launched an audacious and effective international media campaign against Shell after the oil company was given permission by the British Government to sink a huge North Sea storage bouy into the depths of the Atlantic Ocean off the west coast ofย Scotland.

Green activists sailed out and occupied the buoy for more than three weeks, creating a live media story that captured the hearts of the nation’sย viewers.

Seaย Change

While the environmentalists overestimated the amount of oil pollution that would have been caused, the campaign was nonetheless successful. Shell decided to reuse much of the steel in constructing a new facility at Stavanger inย Norway.

โ€œThere was a sea change in Shell in 1997 after Brent Spar,โ€ a senior Shell executive me. โ€œIt was, โ€˜oh God, we’re just making a complete mess of the way we managed externalย issuesโ€™.โ€

He added: โ€œThe group hadn’t thought it necessary to consult or to discuss, you know, see what people thought about it, that sort of whole process of engagement wasย missing.โ€

The oil company had come to realise that it could no longer ignore the concerns of the public, even where the company genuinely felt it was doing the rightย thing.

Shareholderย Pressure

This revolution in thinking inside one of the six major global oil companies coincided with a concerted campaign by British environmental groups, including Greenpeace and Friends of the Earth, to exert pressure on Shell and BP shareholders so they would, in turn, force the oil companies to abandon the Global Climate Coalition.

The Coalition was a corporate lobby group set up to oppose immediate action to reduce greenhouse gas emissions. It was formed in response to the creation of the UN Intergovernmental Panel on Climate Change inย 1989.

Sir Martin Jacomb was chairman of the Prudentialโ€”an international financial services groupโ€”in March 1997 when the insurer held 3.8 percent of Shellโ€™s shares. This made it Shellโ€™s largest singleย investor.

Environmentalists turned up at the Prudential shareholders’ meeting, demanding the company support a resolution to the Shell annual generalย meeting.

This resolution would force the oil executives to produce a fully audited environmental report, and also conduct a detailed investigation into the companyโ€™s suspected involvement with the murders and human rights abuses that had taken place around the Ogoni oil fields in Nigeria.

โ€˜Mankind Depends on Fossilย Fuelsโ€™

Sir Martin, a British American Tobacco banker, told the campaigners he was well aware of the dangers of climate change. โ€œWe are absolutely committed to sustainable development. There is no difficulty about that,โ€ Sir Martinย said.

โ€œBut the idea that one can stop global warming by stopping consumption of fossil fuels, when mankind depends on it, is unrealistic,โ€ he continued. โ€œWe have got to find economic and sustainable ways of using suchย fuels.โ€

Contemporary news reports suggest that Prudential managers have met senior Shell executives โ€œseveral times since controversy erupted over the Brent Spar oil platform and the Nigerian Ogoni oilย fieldsโ€.

Sir Martin refused to bow to the pressure from the campaigners. โ€œWe will not be voting for the resolution. It implies interference with the board in the management of the company. We think it is very, very important not to dilute the responsibility of the board for conducting businessย seriously.โ€

But a remarkable victory was about to be delivered by the environmentalistsโ€™ offensive, which was designed to tear apart the powerful union of international oil monopolies within the Global Climate Coalition. And two decades later, Sir Martin would reappear in our story as a founding trustee of Lawsonโ€™s Global Warming Policyย Foundation.

Up next on DeSmog UKโ€™s epic history series is a look at what happened when former BP boss Lord Browne called for government regulation to reduce carbonย emissions.

@brendanmontague

Photo: Lee Jordan viaย Flickr

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