Research Project: Royal Dutch Shell's Acquisition of BG Group Analysis

This research project analyzes the Royal Dutch Shell's acquisition of BG Group, focusing on business aims, corporate responsibilities, and ethical considerations. The study examines the importance of business ethics, the benefits of strategic acquisitions from political, economic, and ethical perspectives, and strategies for managing corporate responsibilities. The research utilizes both primary and secondary data, employing a deductive approach, interpretivism philosophy, and a quantitative method. The methodology includes questionnaires, literature reviews, and interviews with managers. The project's action plan, presented in a Gantt chart, outlines the research activities and timelines. The report also includes a literature review discussing business ethics, corporate social responsibility, and the benefits of acquisitions. The project concludes with data analysis, interpretation, and recommendations for future research.

RESEARCH PROJECT
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Table of Contents
Task 1 Research Proposal ....................................................................................................................3
Rationale of the research .....................................................................................................................3
Literature Review.................................................................................................................................3
Research Methodology ........................................................................................................................4
Resources required to conduct the research.........................................................................................4
Action Plan (Gantt Chart).....................................................................................................................5
Task 2 Project Implementation and Presentation.................................................................................7
2.2 Literature Review......................................................................................................................7
2.3 Conduct the research planned in the proposal and collate the data to address research
question and objectives....................................................................................................................8
3.1 Describe and evaluate factors that affected the achievement of the project............................10
3.2 Interpret and analyze the results in terms of the original research specification.....................10
Data Interpretation .............................................................................................................................11
3.3 Propose recommendations based on the findings and justify areas for future research..........15
References..........................................................................................................................................17
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TASK 1 RESEARCH PROPOSAL
Aim of the research: The present research study has been made with the aim of analyzing
business aims and corporate responsibilities of Royal Dutch Shell: A case study on acquisition of
Royal Dutch Shell of BG Group.
Objectives: Research objectives have been developed for the purpose of identifying the
aspects that are important under research study.
 To analyze the importance of business ethics and corporate responsibilities.
 To identify the benefits of takeover from political, economic and ethical point of view.
 To determine the ways through which corporate responsibilities and ethical aspects are
maintained.
Research questions: Research questions for the present study has been made so as to give
adequate directions to the study and this will also assist the researcher to reach towards all the
specified aims and objectives.
 What is the impact of ethical aspects on business performance?
 What are the benefits of strategic acquisitions for business entities?
 What strategies can be recommended to business for managing all the corporate
responsibilities?
RATIONALE OF THE RESEARCH
The present topic has been selected because in contemporary scenario, business entities are
getting pressurized to adhere all the corporate, social and ethical responsibilities for long term
sustainability. Researcher had variety of topics to be selected such as importance of ethical
practices, contribution of social responsibilities in economic development and many more.
However, this particular topic has been selected because data is available in huge amount; hence
this could increase the scope of research for future prospects. Further, the subject is also selected
because mergers and acquisitions are increasing in UK which is also contributing in economic
development of the country.
LITERATURE REVIEW
An organization that is believed to be driven by moral values is respected in the society even
by those who do have any information about the working and the businesses practices of that
organization. Business ethics and corporate responsibilities are the major aspects which every
business should follow so that to remain at market place for longer span (Environmental Impacts of
the Oil and Gas Industries, 2015). Organizations are required to be perceived as entities for good
corporate governance and social responsibilities and this perception is held far and wide even by
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those who have no idea about the operations of the organization. Business ethics typically depicts
moral values and beliefs which further influences internal functions of the organization (Tan,
Plowman and Hancock, 2007). Corporate social responsibility reflects the ways through which an
organization considers preferences of clients and social values. Ethical behavior of the business
entity brings significant benefits to the business and it also attracts the customers which boosts the
sales and profitability factor of the business. Moreover, it is also useful in terms of retaining the
employees and other stakeholders (Business Ethics and Corporate Social Responsibility in the e-
Economy: A Commentary, 2007).
Further, takeover is one such aspect that provides numerous benefits to the organization and
that also assists the business to get more sources for managing business funds. From political point
of view, acquisition is crucial since it aids the organizations to enhance the opportunities of
expansion and diversification in diverse market places and at the same time, it also reduces political
difference. Strategic acquisition can be one of the most important means of growth for the business
entity and the key to growth through acquisitions is to take advantage of the synergies for more
development (BG shareholders give Shell's $52 billion acquisition final nod, 2016). Hence,
strategic acquisition is vital in terms of facilitating innovation in the business practices.
While merging with any of the entity, business firms have to make sure that they are
integrating with all the practices especially those which are concerned with social welfare activities.
Merger can be appropriately managed if business resources are properly used and if profits are
shared adequately among all the organizational members (Tilt, 2007). At the same time, mergers
should be linked to corporate social responsibilities of the business entity so that overall growth and
success can be facilitated. The business should always merge with those entity which is engaged
actively in to CSR practices so that social responsibilities can be fulfilled. This will also assist the
business entity to share profits in adequate manner and interest of all the stakeholders can be
retained through the same aspect.
The businesses should always engaged themselves in managing social roles and
responsibilities so that overall contribution can be made to society. At the same time, profits should
be shared among the employees so that they can be retained with the company. The entity which are
merging from each other should contribute in environmental protection by formulating numerous
strategies (Sapsford and Jupp, 2006). Hence, all the activities and practices should be socially
concerned. However, at the time of merging with any entity, business firms have to ensure that other
organization is also socially concerned. Hence, in such respect both will be able to contribute in
social roles and responsibilities.
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RESEARCH METHODOLOGY
Research methodology is an important part of the research study and it also assists the
researcher to reach towards the determined aims and objectives through using specific tools and
techniques. For the present case, researcher will be using primary and secondary both the sources
for collecting data about acquisitions and business ethics. Sampling for the current study will be
done on the basis of random sampling and sample size will be 15 managers of both the acquired
organizations (Kuada, 2012). Deductive approach will be used in the subsequent study as it is
concerned with developing a hypothesis based on existing theory. It will be selected because it
begins with an expected pattern that is tested from observation. Further, Interpretivism philosophy
will be selected since it involves researcher to interpret the elements of the study. It is also based on
the critique of positivism in social sciences. Quantitative method will be used for the purpose of
analyzing the responses and findings. Graphs, charts and pictures will be made to interpret the
findings. Questionnaire will be made for the purpose of acquiring responses from the respondents.
Newspaper, internet sources, articles, books and journals will be reviewed so as to acquire data on
the same topic (Randall, 2000).
RESOURCES REQUIRED TO CONDUCT THE RESEARCH
Human, financial and time resources will be required to conduct the research study in
prominent manner and all the resources will be utilized optimally for the purpose of reducing the
amount of resource wastage. Human resources will be conducting all the practices and they will be
entitled to implement the plan to action. Financial resources are also required for the purpose of
managing the research study in optimum manner and the department will ensure that properly
resources are allocated to each and every step (Olsen, 2011). Researcher will also make sure that the
study will be submitted within the time limit and for that every activity will be conducted as per the
schedule determined in Gantt chart. Hence, all such resources are vital because they play diversified
roles in managing the research study as per the research objectives.
ACTION PLAN (GANTT CHART)
As per the schedule, researcher will be conducting all the activities and dates for meetings
and interviews will also be decided prior implementing the study practically. Researcher will also
analyze and monitor all the activities prior submitting the study to tutor.
Activity Week1 Week2 Week3 Week4 Week5 Week6 Week7 Week8 Week9
Writing
Research
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Proposal
Reading
various
literature
Finalizing
the aims
and
objectives
Draft
literature
review
Collect
secondary
data
Analyze
secondary
data
Develop
research
approach
Draft
research
methodolog
y
Develop
questionnair
e
Arrange the
interview
Conduct the
interview
Accumulate
the data
6

Draft
Findings
Analyze
data
Complete
remaining
chapters
Submit it to
tutor and
await for
feedback
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TASK 2 PROJECT IMPLEMENTATION AND PRESENTATION
2.2 Literature Review
Importance of business ethics and corporate responsibilities
Both the terms business ethics and social responsibility are often used interchangeably by
the business members, although each of the concept has a divergent meaning. In contemporary
scenario, businesses are required to identify requisite resources and that should be adequately
interpreted so that its impact on environment can be found out (Ethical Issues in Community
Interventions, 2013). The business in such respect are also required to control and coordinate
internal activities so that issues related to environmental disturbances and uncertainty can be
minimized. It is an apparent fact that business organizations use open systems by which they can
acquire profits and revenue for the purpose of getting survival opportunities. Nonetheless, business
entity must balance own desire for profit against the needs and desires of the society within which
they operate.
Hence it can be said that CSR is a multidimensional conception associated with four major
prospects such as economic, legal, ethical and voluntary philanthropic responsibilities. Under the
chief economic responsibilities of a business, they are required to produce goods and services which
do not harm the interest of society and along with that, those services should be delivered at a price
that can uphold the business and that can satisfy the needs and demands of customers (Importance
of Ethics, 2016). Ethical responsibilities are those behaviors or activities expected of business by
society; but these are not codified by the law. Therefore, this subset of corporate social
responsibilities can be interpreted as expressing the 'spirit of the law towards the society. It has been
seen that working an ethical business entity helps the organization to survive at marketplace for
longer period; moreover customers can also be attracted towards business products and services
(Zyla and Mark, 2011).
Benefits of acquisitions from political, economic and ethical perspectives
Acquisitions are considered as essential for the business entities especially at the time when
the organization is unable to survive in the competitive market place. It is apparent that acquisition
is beneficial for the business entities from economical point of view because that merging entirely
with another business firm can raise the level of profitability and success. On the other hand, long
term gains and profit shares can be increased through takeovers (Shell Shareholders Approve
Acquisition of BG Group, 2016). Political barriers and constraints can also be reduced and
minimized through acquiring new business entities. At the same time, ethical perspectives should be
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followed when entering into new markets so that new customers can be retained by the business
entities. Company's ethical approach increases when new policies and procedures are embraced into
it.
Ways through which corporate responsibilities and ethical aspects are maintained
Corporate Social Responsibilities are vital for every business entity to consider because that
aids in retaining all the stakeholders and investors for longer span. Similarly, it has been observed
that oil companies are maintaining their social and corporate responsibilities through contributing in
environmental protection practices (BG shareholders give Shell's $52 billion acquisition final nod,
2016). Hence, in such respect, CSR strategies are formulated by every business entity for the
purpose of maintaining the interest of stakeholders and other business managers. Ethical aspects are
maintained through delivering only adequate information about the company's services to the
customers (Solomon, 2011). Environment is not the only concern that lies under CSR activities but
there are several others also which are important under corporate responsibilities of the business
entity.
2.3 Conduct the research planned in the proposal and collate the data to address research question
and objectives
In order to conduct the research study, researcher has collected several tools and techniques
and this also assists in collecting relevant data for the report. In the below mentioned section, varied
techniques and methods have been discussed that have been selected by the researcher:
Research philosophy: Interpretivism philosophy has been taken into consideration in the
present study because as per the philosophy, researcher can assume that access to reality is only
through social constructions and shared meanings (Saunders and et.al. 2007). Development of the
philosophy is also based on the critique of positivism aspect. Research philosophy can be
categorized into two types such as positivism and Interpretivism where in positivism objective is
concerned and strongly believes in giving critical explanations. Thus, researcher has undertaken
Interpretivism philosophy as it is socially constructed and it also focuses on meaning by employing
multiple methods (Solomon, 2011). Therefore, use of such thing reflects different aspects of the
issue and according to the approach, reality can be subjectively differentiated based on the meaning
and comprehensive aspects. Interviews and observations are the most popular primary data
collection methods used in Interpretivism studies and secondary data research is also popular with
Interpretivism philosophy. Hence, researcher has derived multiple interpretations afterwards using
the subsequent philosophy (Sapsford and Jupp, 2006).
Research approach: Research approach has been categorized into two ways such as
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inductive and deductive and for the present research study; investigator has undertaken Deductive
approach which is concerned with developing a hypothesis. It has been selected because the
approach can be explained by the means of hypothesis which can be derived from the propositions
of different theory (Roy and Banerjee, 2012). Basically, it has been selected because deductive
approach is concerned with deducting conclusions from premises or propositions. It also begins
with an expected pattern that is tested against observations; however on the other hand, inductive
approach is focused on exploring new phenomena from different perspectives. Moreover, it can be
articulated that deductive approach is being selected because it provides reasoning from the general
inferences to particular inferences. Thus, for the present study also, researcher has formulated
hypothesis and it is also tested during research process (Randall, 2000).
Research design: It is essential for the researcher to interpret the findings and analysis and
for that specific tool and technique is required to be used. Hence, for such aspect, researcher has
selected Quantitative research design where in data has been analyzed through statistical tools and
charts have been made to represent the data in clear manner. Research design is specifically
concerned with stating findings and analysis; therefore proper consideration is required to be given
towards this aspect of the research (Olsen, 2011). Basically, research design is split into two types
such as Quantitative and Qualitative; however in the present study, researcher has used Quantitative
method for statistical representation of data. In Qualitative method, themes can be prepared so that
each and every aspect of the research study can be clearly depicted to the readers. Thus, selection of
Quantitative method has been made on the above mentioned criteria.
Data collection: Data collection is essential part of the research methodology where in
researcher collects relevant data for the present study, it is vital in terms of identifying the scope of
research topic. The categories of data collection can be split into two types such as primary and
secondary methods. In the present report, primary and secondary both the methods have been used
for collecting wide range of data (Kuada, 2012). Under primary sources, interview and survey have
been conducted so that views and opinions of managers can be taken regarding takeover of Royal
Dutch Shell with BG Group. Managers are provided questionnaire where in they have to specify
their answers regarding different aspects of acquisitions and takeovers. Further, interview has also
been conducted regarding business ethics and corporate responsibilities of both the entities. On the
other hand, secondary study is also conducted where in researcher has accessed several books,
articles, journals and different sources (Sapsford and Jupp, 2006). Information collected from all
such sources have been concluded and evaluated in data analysis section.
Ethical considerations of the study: While preparing the study, it is essential for the
researcher to consider ethical and legal aspects so that issues and constraints can be minimized. At
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the same time, it is also vital for the researcher to conduct the study within the available resources
so that remaining resources can be utilized for other purposes (Importance of Ethics, 2016). Apart
from this, researcher has also taken only relevant and authentic sources so that reliability of the
research report can be maintained. Data which have been collected from diverse resources are
utilized after identifying the date and relevant information of the author. Fake and authentic
websites have been avoided so that suitability and feasibility of research can be enhanced and this
has helped the researcher to develop authentic study. Information about the respondents has been
recorded in secured database and only authorized persons are allowed to access the data.
Sampling: Sampling is the process through which researcher can segregate the population
for the survey and interview method. In the present research study, researcher has selected random
sampling method where in managers of Royal Dutch Shell is selected on random basis. Sample size
for the current study is 15 managers of subsequent business entity (Roy and Banerjee, 2012).
3.1 Describe and evaluate factors that affected the achievement of the project
Prior selecting the subsequent topic, researcher has gone through with different topics and
subject matter; however selection has been made on the basis of availability of data (Tan, Plowman
and Hancock, 2007). Ethical approaches and corporate responsibilities are those perspectives of
business entity that should be emphasized upon so that interest of all the stakeholders can be
protected and retained. In the oil sector of UK, several acquisitions have been made; thus research
study has selected this particular topic (Tilt, 2007). Mergers and acquisitions are beneficial for the
business entities because that improves the work conditions and that also provides more
opportunities of growth and success. Besides these aspects, time and financial resources have
affected the research study because researcher had only limited number of resources to be used to
complete the study. One of the chief challenges has been faced in the area of selecting sample size
because most of the managers are new to the company and they only limited idea about the field of
research (Tilt, 2007).
3.2 Interpret and analyze the results in terms of the original research specification
Questionnaire:
Q1. Have you seen any political benefits after this acquisition (Royal Dutch Shell with BG Group)?
 Yes
 No
Q2. Do you think, political reach of the company is increased due to the subsequent merger?
 Yes
 No
Q3. Do you agree that, economic capability of the company has been increased after takeover?
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 Yes
 No
Q4. Is the company maintaining all the ethical perspectives?
 Yes
 No
 Sometimes
Questions asked during Interview:
Q1. What are the major things that are included in CSR activities of your business?
 Environment concern
 Stakeholder's concern
 Ethical consideration
 All the above
Q2. Is the company using fossil fuel for eco-friendly approach?
 Yes
 No
Q3. Up to what extent, drilling and mining exploration activities affects natural environment?
 Does not affect
 Sometimes it affects
DATA INTERPRETATION
Theme 1 Political benefits acquired after acquisition
At the time of asking this particular question, out of 15, 12 managers said that the company
has acquired numerous political advantages after the takeover of BG Group. However, on the other
hand remaining 3 managers said that the company has not acquired any political advantage even
after the acquisition because business deals have been made with limited companies only. The
managers also said that political scenario of other countries is far different with that to UK; hence
this is the reason, political barriers are not reduced even after the takeover. Hence, as per the
responses it can be said that political conditions do not change in strategic acquisitions because of
different regulations and framework adopted.
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Theme 2 Economic capability of the company has been increased after takeover
While putting up this question, 10 managers of Royal Dutch Shell said that economic
condition has been improved after takeover of BG Group. The managers as well as the company
consider this takeover as one of the first energy mergers in the era of low oil prices. Managers said
that they had expected major oil companies like Shell and ExxonMobil to take advantage of low
prices for acquiring business over rivalries. This has also strengthened company's position, but even
after that, there have been big moves so far. However, on the other hand, 5 managers said that they
have not seen any changes in economic prosperity of the company because BG Group was already
facing loss; thus the assets were of no use for Royal Dutch Shell.
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Theme 3 Company is maintaining all ethical perspectives
While asking this question, 12 managers said that the company is maintaining all the ethical
aspects and that also aids in acquiring suitable position at the market place. However, 1 manager
said that ethical aspects are not followed after the takeover and some of the employees are giving
inadequate concern towards ethical facets. Remaining 2 managers said that sometimes, ethical
aspects are followed and sometimes it gets skipped. However, the managers also said that
management of ethical perspectives aids them to get deals with numerous investors from overseas.
Hence, from the discussion, it is clear that ethical facets should be maintained so that business can
survive for longer time period.
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Theme 4 Major things included in the CSR activities of business
While asking this question during the interview, 3 managers said that environment concerns
are given more importance in CSR practices of the company; however 2 managers said that
stakeholders are considered more in CSR activities. Further, 1 manager said that ethical
considerations are given more importance because this allows the company to sustain at market
place for longer span. Majority of managers (9) said that CSR activities of the company include all
these aspects (environment, stakeholder's concern and ethical aspects). The managers also said that
concern towards these dimensions allows Royal Dutch Shell for more mergers and takeovers.
Theme 5 Drilling and mining exploration activities affects natural environment
Drilling and mining activities of subsequent company do not affect the environment because
during production, large amount of produced water are recovered with the hydrocarbons. The
managers also said that this is clean to very stringent standards and some are also re-injected to
maintain reservoir pressure. They monitor the practices; hence this shows no significantly increased
environmental risk. However, on the other hand, 6 managers said that sometimes these activities
affect the environment.
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3.3 Propose recommendations based on the findings and justify areas for future research
On the basis of above discussion, it can be said that ethical and social responsibilities of the
business plays crucial role in maintaining success and prosperity aspects. As per the data collected,
it has been predicted by the researchers that low prices of oil will remain a challenge for the
combined company in the short term. While on the other hand, prices of the oil are expected to
stage a gradual recovery (Zinkin, 2011). Social responsibility is related to the economy because it
comprises a number of specific issues related to business management in competitive scenario,
consumer retention, employee management and contribution in environmental protection.
The legal responsibilities of businesses are simply concerned with the laws and regulations
which are ought to be adhered. It is the bare minimum requirement of business organizations
towards the society to return them best output in the form of delivering appropriate goods and
services which have the capability to satisfy individual needs and wants (Zyla and Mark, 2011).
Thus, in such respect the legal dimension of corporate social responsibility refers to considering
local, national and international laws that are regulated to competition. Business entities are also
required to protect the workers through considering human rights and safety legislation. Apart from
this, businesses are also required to consider consumer protection legislation because they are the
ultimate users of business products (Dealing with Unethical Issues in an Ethical Way, 2013).
Moreover, organizations should consider the responsibility towards natural environment; hence
environmental protection laws should be considered. Thus, it is selected to the business entity to
consider ethical values and norms in all the business processes.
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