By John Donovan
Geneva-based Covalence recently published its ethical rankings for 2008 covering 541 multinationals.
It says on its website:
“Covalence’ s ethical quotation system is a reputation index based on quantifying qualitative data, which is classified according to 45 criteria such as Labour standards, Waste management, Product social utility or Human rights policy. It is a barometer of how multinationals are perceived in the ethical field.”
Out of 541 multinationals surveyed, Royal Dutch Shell has an overall ranking of 510, alongside the likes of the tobacco companies and Halliburton.
The entire rankings can be viewed on the Convalence website:
By comparison, Shell’s oil giant rival BP, has a much more respectable overall ranking of 145. This is despite all of BP’s travails, including the adverse publicity arising from the pipeline problems in Alaska, the Texas City Refinery disaster and the sudden departure of Lord Browne as a result of an unsavory scandal.
So why is Shell’s ethical ranking almost at rock bottom?
The company has been caught up in many controversies and scandals including a multi-billion dollar securities fraud; multiple greenwashing offences; price-fixing cartels; an oil-for-arms corruption scandal; a level of employee fatalities higher than any of its peers, and a track record of deadly pollution e.g. continued gas flaring in Nigeria Shell had promised to end years ago.
Information can be found on Wikipedia.
The company has also been hit with a series of embarrassing leaked internal emails reported by many global news organisations:
Last week, Reuters published an article about a Shell confidential high level email revealing senior managements chilling vow to “ruthlessly review 3rd parties costs”.
The definition of “ruthless” is: “Without pity or compassion; cruel, pitiless.”
It is difficult to reconcile the ruthless nature of Shell’s business plans, as set out in the confidential email, compared with its claimed business principles of treating people with respect.
Richard Wiseman, Chief Ethics & Compliance Officer of Royal Dutch Shell Plc, did not take up my invitation to comment on the shamefully low rating.
If Shell management does not start behaving in accordance with its own ethical code pledging honesty, integrity and transparency, instead of acting like a ruthless robber oil baron, its ethical ranking will remain toxic.