PESTLE Analysis of Royal Dutch Shell

This article provides a PESTLE analysis of Royal Dutch Shell, examining the political, economical, social, technological, legal, and environmental factors that affect the company. It discusses the threats and opportunities for the company in each factor.

Global Business
Environment CW1
External Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION................................................................................................................................2
References:.......................................................................................................................................3

INTRODUCTION
PESTLE Analysis refers to the framework to recognise the external environmental
factors that directly or indirectly affects the internal environment of an organization. It stands for
political, economical, social, technological, legal and environmental (PESTLE analysis, 2020).
Royal Dutch Shell is one of the leading international public limited company. It was founded in
2002 in UK. It deals with the natural gas, oil and manufacturing of chemicals. The following
discussion is based on PESTLE Analysis of Royal Dutch Shell.
MAIN BODY Political Factors: These are the factors which involves the resolutions that government
make which can affect the business positively as well as negatively. In context of Royal
Dutch Shell, there is the hostility, political lobbying and instability in this sector. This can
be a threat for the company for it's own stability in a market. Royal Dutch Shell has a
good brand image and revenue and can easily cope up with this threat by it's strategies to
operate business and employees (Achinas, Horjus, Achinas and Euverink, 2019). Economical Factors: This factors aims at economic conditions affecting the business. In
context of Royal Dutch Shell, there is a variations in economic conditions for the firm.
Moreover, keen variations in currency rates. So this can be a threat for the firm. But
stabilising these factors are important so that firm can grow it's revenue. Social Factors: This factors focuses on the peoples perception on oil products. In context
of Royal Dutch Shell, now-a-days people are more conscious about health. But they are
having negative perception about oil and gas industry. This is a threat for the firm. Firm
should create awareness about the products and making the customer believe that there is
minimum negative aspect with oil and gas products by company's side. Technological Factors: This factors aims at the artificial intelligence and block-chain
technology in a firm. In context of Royal Dutch Shell, this can be an opportunity for the
firm to innovate themselves in technology and digitalization for their sustainable growth.
Today, technology is at it's heights and most of the people prefer digital world so it is
important to move with the people choices to maintain stability in the market
(Christodoulou and Cullinane, 2019).
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 Legal Factors: This factor focuses on competition, trading and data protection laws. In
context of Royal Dutch Shell, this can be the opportunity for the firm. Because these laws
prevents any data leakage, trading misuse and negative competition factors. So by
according to these factors, firm is on safer side. Growth and development can be possible
for the firm by analysing the legal factors (Düerkop and Huth, 2017).
 Environmental Factors: This factor aims at the climate and the geographical concerns.
In context of Royal Dutch Shell, there is a rising issues in climate change and causing
geographical problems for the firm. So this can be the threat for the company. Although
these issues are natural and the firm cannot control these factors but avoiding such
circumstances can help firm to overcome environmental factors.
CONCLUSION
It is concluded that PESTLE analysis of Royal Dutch Shell depicts negative side more
rather than the positive side. There are more threats as compared to opportunities. So company
must work on it's threats first so that it can be on a safer side. Opportunities can give the firm a
better growth and revenue by focusing and analysing them at every perspective of these factors.
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References:
Books and Journals:
Achinas, S., Horjus, J., Achinas, V. and Euverink, G.J.W., 2019. A PESTLE Analysis of
Biofuels Energy Industry in Europe. Sustainability. 11(21). p.5981.
Christodoulou, A. and Cullinane, K., 2019. Identifying the Main Opportunities and Challenges
from the Implementation of a Port Energy Management System: A SWOT/PESTLE
Analysis. Sustainability. 11(21). p.6046.
Düerkop, S. and Huth, M., 2017. Transportation under Threat–A PESTLE Analysis for Critical
Logistical Infrastructures. ICTA2017, p.14.
Online:
PESTLE analysis. 2020. Available through
<https://www.cipd.co.uk/knowledge/strategy/organisational-development/pestle-analysis-
factsheet>./
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