Pestle analysis of Royal Dutch shell

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