Pestle analysis of Royal Dutch shell

This report provides a Pestle analysis of Royal Dutch shell, examining the political, economic, social, technological, environmental, and legal factors that impact the company's operations and growth.

SIm337 Contemporary
Developments in Business and
management Assessment (GI KE))

Table of Contents
INTRODUCTION...........................................................................................................................3
Task 1...............................................................................................................................................3
Pestle analysis of Royal Dutch shell............................................................................................3
Task 2...........................................................................................................................................5
Importances of CSR TO SHELL.................................................................................................5
Effectiveness the Shell's response...............................................................................................7
CONCLUSION..............................................................................................................................10
References......................................................................................................................................11

INTRODUCTION
Every business is highly impacted by change in external factors. These factors affect on
their growth and development in various markets (Renwick.and et.al., 2016). Also, it results in
influencing on decision making and developing polices and strategies. CSR plays significant
role for business. It enables in contributing towards society and maintaining sustainable
ecosystem and atmosphere. There are many initiatives and practices followed by companies in
CSR. This report will describe about external factors and how it impacts on business. In second
part it will be discussed about importance of CSR and sustainability in Royal Dutch shell.
Task 1
Pestle analysis of Royal Dutch shell
Pestle analysis is a crucial step for devising strategy that can be effectively maximizing
sustainability as well as profitability.
Political factors
The political factors that influences the profitability of the firm are quite diverse. The
level of the government intervention within the world regarding business had grown leading to
higher pressure on the international brands. Economic environment as well as trade can be
affected by the overall political environment of a nation. Europe is the main markets of the Royal
Dutch shell. ( Gerasimov. and Gerasimov,2015) Political stability in these nations effects sales
as well as profitability. Instability in Persian Gulf and middle east will impact on company
operations. Also, change in oil corporations with regard to climate policies also affect on Royal
Dutch shell growth and development.
Economic Factors
The demand regarding oil and gas had grown within the recent years as economic factors have
always remained at the core within context regarding international business. Thus, everything
depend upon the costumers demands as well the ability of the purchasing (Schaltegger. and
Burritt, 2017). Globally economic issues such as different economic condition across world has
enabled created negative impact o growth of Royal Dutch shell. It is leading to decrease in
profits and sales. due to economic fluctuation oil prices are increasing at rapid rate. The
pressures arises from the Brexit continuously affect the profitability of the Royal Dutch shell
within the United Kingdom. Factors like economic activity within a particular nation or region
and also as the level of the employment impacts the purchasing power of the people living

within the particular area that also affects the sales as well as profitability company. Also, the
growing competition within the world also made the economic factor's role within the field
regarding international business grow. Also, economic factors cannot be avoided within terms of
the business strategy (Schaltegger. and Burritt, 2017).
SOCIAL
The role as well as importance of social cultural factors with business is also growing as most of
the business understands the social cultural factors within the context of the business as well as
how they can affect the sales and profitability within specific regions. Changing the lifestyle of
the people and social trends affects the buying habits of the people ,also the consumption pattern
over the time and people preferences within various regions across the world have changed a
lot. Now people are becoming more environmentally friendly. They are forcing oil and gas
companies to contribute more towards social development. However, a negative perception is
developed among them about this industry. Thus, due to it their needs and demands are changed.
it has (Wilton, 2016)
Technological factors
Technology is playing a vital role in business. It has revolutionised the way of doing business.
However, in oil and gas industry AI application in battery is impacting on Royal Dutch shell
operations. Furthermore, blockchain technology is also affecting on supply chain management of
oil and gas industry. it has resulted in affecting Royal Dutch shell operations as well. Due to it,
growth and development of Royal Dutch shell is hampered. In addition, there is significant
changes occurred in other areas as well of the industry (Rosemann and vom Brocke, 2015).
Environmental
Environmental as well as sustainability haves becomes crucial areas for the businesses within
twenty-first century. Firms are investing within the reducing their carbon foot prints and also
making their business process more sustainable. While on the other hand, it is crucial for
creating an image which is socially responsible image . Governments are also implemented strict
laws that able to demotivate irresponsible practices. The oil and gas industry is highly impacted
due to change in environmental laws and regulations. Now, many country government is
focusing on sustainability. Alongside, climate change is also a concern for oil and gas industry.
so, these changes are directly impacting on Royal Dutch shell operations in various countries. it
has forced them to focus on sustainability. Therefore, this is impacting on their growth (Rees and

Smith, 2017). Also, the firm also assist its consumers to maximize the efficiency by having the
minimum influences regarding environment.
Legal
Legal factors has also acquires crucial role within the world regarding business. As all over the
world , government laws as well as enforcement agencies have enhanced the oversight and the
level of control of businesses. With the enhancing growth of legal and regulatory pressures can
makes growth more difficult regarding the international businesses. The change in laws such as
compliance and trade laws between nations, etc. is highly impacting on Royal Dutch shell
operations. The organisation is not able to do trade with other countries. From antitrust to
competition laws as well as businesses practices within other areas involving
environment ,business have the mindful compliance within each area (Vom Brocke,Petry. and
Gonser,2016).
Task 2
Corporate Social responsibility and Sustainability (CSR)
It is a responsibility when a firm operates within sustainable and ethical way as well as
deals within its social and environmental impacts. Thus it means that careful consideration
regarding human rights ,environment, the community, and society in which it operates.
Importances of CSR TO SHELL
It is incredible crucial for Royal Dutch Shell plc, operates within a way that can demonstrates
the social responsibility. As it is not a legal requirement that can see as good practice to take
account environment and social issues.
HSSE and SP commitment as well as policy
The commitment of the shell regarding policy on health, safety ,security ,social performances
and Environment applies all over the shell (Vinichenko.and et.al., 2016). It can be designed to
protect people as well as their communities and also the environment where they can operate.
Some mandatory standards and manual supports came under the HSSE and SP Control. It has
covers around 11 areas such as Health, environment, process safety, transport, personal safety,
Contractor HSSE management, projects, security as well as social performance. All the
employees of the shell, people working within the joint ventures, contractors that they can
operate should work as per with the Shell HSSE and SP commitment as well as policy. They

also have need regarding special parts of the business as it involves shipping standards as well as
sustainable sources regarding biofuels (Collings, Wood, and Szamosi, 2018).
Quality of Ship assurance standard
Shell firm has wide ship quality assurance stander goals to reduce accidents, safety incidents or
oil spills from reducing risk and bulk quantity transport ships. The risks such as Harm to
environment, people, reputation of shell damage and also the claims of shell regarding financial
claims (Vinichenko.and et.al., 2016).
Sustainable sourcing regarding biofuels
Shell firm is consider as a major buyer of the biofuels regarding blending into the fuel.
To assure the biofuels come from various sustainable sources they support rigorous
sustainability standards. To governs the way they work regarding the suppliers on sustainability
in 2007 they introduced a policy as the needed to comply with regulatory needed such as by
internal certification schemes. When such kinds are not (available) than they can introduce their
own environmental as well as social sustainability causes into new as well as renewed supplier
contracts. As per their clauses they require suppliers able to respect human rights within
production regarding biofuels as well as not cultivate biofuels within the areas that are rich in
biodiversity. As under this policy they (firm) can closely work with their suppliers within
developing a supply chain that is sustainable supply chain and also able to review their progress
on a regular basis (Rees and Smith, 2017).
HSSE & Assurance
It is vital that their frameworks as well as control that involves their process safety
standards that can be suitably ensured. This is known as the responsibility of SP & HSSE and
also the process assurance team ,as which can be independent of their business as well as
mandated regarding at the Board level by their corporate social responsibility committee. Here
the team can develops as well as carries out audits that may be covers the broad variety
regarding possible risks within assets as well as projects. Consequences of all audits as well as
responses regarding shell's management that can be shared within relevant parts of the firm as
well as CSRC (Rosemann. and vom Brocke, 2015).
Ethical practices and Social responsibility are crucial for the success of a firm. The
strategies of the Royal Dutch shell involves a number of activities, that ranges from promotable
scientific skills and marketable technical skills of the young people regarding promotion.

Firm also launches the Live Wire international programme to conflict the high level regarding
youth unemployment. This projects also supports thousands of young entrepreneurs who want to
start the new businesses with the more businesses' knowledge. It also offers tailored support to
transform from their enterprising ideas into a possible as well as sustainable business.
The programs can recognizes the requirements exists within various nations as well as its uses
a broad range of activities to interact especially with the young people as they involves
training, workshop as well as mentoring each other (Sadgrove, 2016).
Online businesses gives an information and also a wealth of guidance to the people who
want to start up a company. Guidance involves advice on intellectual property works ,dealing
with taxes, sourcing funding , proper research so that there is easy to define the services or
product, determining price as well as planning ,developing and marketing communication skills.
It also provides guidance to the public who might not have the clarity about the various kinds of
the business that might be set up as well as brainstorming sessions to promote the generation of
the original businesses ideas that can takes place. Here additional information is also offered
regarding legal issues such as sales skills ,networking skills as well as sales skills ,exporting,
doing accounts as well as finances as well as employing people. Persons get the benefits from
the livewire projects can share their experiences on a blog as well as other stories that can be
great aid to those who thoughts of setting up a business. Apart from who fears the involved
challenges (Welford, 2016).
To begin to develop as well as nurture a passion regarding scientific disciplines for
children as well as their families within the north-east Scotland ,firm organizes family Science
Days. To invest within science within at early stage is considered as the best way to raise their
interest within science that can boosts them to pursue university degrees within discipline.
CSR strategy is beneficial regarding their business as well as for the employment regarding
young people. Practical sciences activities can be arranged through the shell that involves
activities about the forces, motion, energy transfer and also the materials for example making
kites, creating jumping beans and building straw towers (Johnson, 2018).
Effectiveness the Shell's response
In order to maintain CSR and sustainability the company has launched and developed
many programs to maintain effectiveness the company have responded in a very good way they
have initiated programs such as Shell foundation was established within the year 2000. It was

initially funding of around $ 250 million and also the Annual donations around $ 15 million per
year. The Foundation has six main programmes such as environmental challenges and Tackling
global development.
The six programmes are given below
Aspire
It is a small and medium enterprises within Africa, It is considered as the integrated Business
development and also Businesses capital (Geisler. and Wickramasinghe, 2015).
Breathing space
It can improve the cooking stoves as it is considered as the involuntary programme regarding
activities that disseminates energy efficient cook stoves basically to the households within
India. In the country like India as cooking is more responsible for the 90 % regarding
households energy consumption. It can design to accomplish the reducing within fuel
consumption as well as improvement within the level of the indoor air pollution.
It able to tackles the ''Indoor Air pollution” (Welford, 2016).
EMBARQ
It can catalyses as well as helps implement socially, environmentally and financial sustainable
urban mobile solutions so that it can improve the life's within the cities. With the help of Shell
foundation it can be founded in 2002 ,it is now considered as a part of the WRI ross centre
regarding sustainable cities. It has public private partnership such as Mexico city.
EXCELERATE
It is considered as the modern energy services to the poor such as India as well as Bangladesh.
TRADING UP
It can provide the Business Mentoring, seed capital and in addition to this business partnership
regarding the sustainable supply chain. It connects major retailers with small businesses and
developing world producer (Collings, Wood, and Szamosi, 2018).
CLIMATE CHANGE
It involves the BREATHING SPACE,EMBARQ ,EXCELERATE .It is also used to reduce
green houses gases.
GACC ( Global Alliance regarding clean cook stoves)
It is considered as the Public private initiative as it was set up within 2010 as it tackles harmful
smokes that can be caused through open fires as well as inefficient stoves. The Global

Ambassador is known as Julia Roberts . It has also committed around $6 million all over the
three years (Vinichenko and et.al., 2016).
SHELL ECO MARATHON
To design build as well as test ultra energy efficient vehicles . The marathon events was first
within the Americas and then Europe as well as Asia. Here the winners of the team also got the
furthest by using the at amount of energy that is at least amount of energy. It was occurred in
2012 in the Huston, Rotterdam, Kuala Lumpur as well as United states of the America.
HIV/AIDS programmes.
These are the significant programs that are used within the medical treatment as they can gives
the education as well as prevention programme. Their partnership is with the local as well as
global firms. They can develop the UNAIDS scenarios developments as well as global
businesses regarding on health such as GBC Health (Vom Brocke,Petry. and Gonser,2016)
To improve the Corporate Social responsibility of Shell
It is considered as the social responsibility that can mostly overlooked. Mention below there are
some factors where firm can improved.
Transparency
If shell firm can be transparent to the employees as well as external stakeholders they do not
require fancy strategies as they cannot hide the failures and also the transparency can increase
the trust.
Get involved the employees
To accomplish a fully realized strategy such as firm cannot boost their employees to draw
stronger lines between the work as well life. Boost a healthy work/life is considered as a great
way to kick start the policy of CSR. Apart from encourage as well as incentives them to do
something regarding charity. As they can already doing something where they can form into a
charity event (Sadgrove, 2016).
Talk it up
Firm can tell everyone about the CSR success as firm can use their polices as a part regarding
marketing Strategy. Communicating the success will engage consumers, motivate the
employees, illustrative competitive advantages.
Measuring success.

Finally, after that makes sure that to measures the policies as it is considered as the good as well
as improving the CSR but it is crucial to understands the influence the challenges. Also measure
the smaller success, also cut down the paper waste, in addition to this finally major financial as
well as environmental impacts. By seeing their changes can motivate to create the plies that are
bigger (Collings, Wood, and Szamosi, 2018).
CONCLUSION
From the above study it had been concluded that Pestle analysis hat influences the
profitability of the firm regarding business had grown leading to higherpressure70% decisions
made through European Union regarding communication sector.. The economies within the
United Kingdom impacts the purchasing power of the people and also affects the sales as well
as profitability of brands. Growth within the demand of the internet based is increasing and
also the role of the internet is also increasing within the life social factors is also becomes
crucial while promoting their services and brands within a particular regions. Shell firm needed
to comply with regulatory needed able to respect human rights within production regarding
biofuels closely work with their suppliers able to review their progress on a regular basis.
Ethical practices and Social responsibility are crucial to conflict the high level regarding also
supports thousands of young entrepreneurs the requirements exists within various nations with
the young people as they involve training. Transparency the employees as well as external
stakeholders the trust.

REFERENCES
Books and Journals
Collings, D.G., Wood, G.T. and Szamosi, L.T., 2018. Human resource management: A critical
approach. In Human Resource Management (pp. 1-23). Routledge.
Geisler, E. and Wickramasinghe, N., 2015. Principles of Knowledge Management: Theory,
Practice, and Cases: Theory, Practice, and Cases. Routledge.
Gerasimov, B.N. and Gerasimov, K.B., 2015. Modeling the development of organization
management system. Asian Social Science, 11(20), p.82.
Johnson, P., 2018. Fundamentals of collection development and management. American Library
Association.
Rees, G. and Smith, P. eds., 2017. Strategic human resource management: An international
perspective. Sage.
Renwick, D.W.and et.al., 2016. Contemporary developments in Green (environmental) HRM
scholarship.
Rosemann, M. and vom Brocke, J., 2015. The six core elements of business process
management. In Handbook on business process management 1 (pp. 105-122). Springer,
Berlin, Heidelberg.
Sadgrove, K., 2016. The complete guide to business risk management. Routledge.
Schaltegger, S. and Burritt, R., 2017. Contemporary environmental accounting: issues, concepts
and practice. Routledge.
Vinichenko, M.V.and et.al., 2016. Modern views on the gamification of business. Journal of
Internet Banking and Commerce, 21(S3), p.1.
Vom Brocke, J., Petry, M. and Gonser, T., 2016. Business process management. In A Handbook
of Business Transformation Management Methodology (pp. 137-172). Routledge.
Welford, R., 2016. Corporate environmental management 1: systems and strategies. Routledge.
Wilton, N., 2016. An introduction to human resource management. Sage.