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Former Shell Executive Paddy Briggs comments on WSJ forecast of Exxon-Chevron BP-Shell supermergers

September 24th, 2007

THE RELEVANT WALL STREET JOURNAL ARTICLE:

The Wall Street Journal: Big Oil’s Latest Roadblock (*WSJ forecasts Exxon-Chevron and BP-Shell mega-mergers)

PADDY’S COMMENTS

The bigger and the more international a corporation becomes the less vulnerable it is to governmental and supra-governmental regulation. ExxonMobil, ChevronTexaco, BP and Shell are arguably already big enough and geographically diverse enough to be almost beyond the reach of the regulators. I say “almost” because, as Shell has found to its cost, if you operate in the US you can be vulnerable in the US courts even for offences committed elsewhere. But Shell will have learned from the reserves fiasco and no doubt the lawyers have been busy reducing the company’s vulnerability to controls and regulations. The oil companies are amongst businesses most vocal advocates of free enterprise and self-regulation. Indeed Shell’s “Corporate Social Responsibility” initiatives need to be seen in this light. The premise is that if you demonstrate your corporate rectitude and your strong internal controls and rules then the external regulators will leave you alone. This was the route followed for years by the tobacco giants and it worked – although in the end their hands were eventually tied in civilised countries by the application of anti-advertising laws.

One of the key advantages to the oil giants of further consolidation (aside from the opportunity to exercise monopoly power) is to make it even more difficult for regulators to control them. But imagine the scenario if not only did Shell and BP (or Exxon and Chevron) merge but they brought Saudi Aramco into the family as well! How would anyone be able to regulate an energy giant of this size – especially if their Head Office was in Riyadh rather than Houston, London or The Hague!

Paddy Briggs

Paddy is the managing partner and founder of BrandAware™

He retired from the Royal Dutch/Shell Group of Companies in 2002 after 37 years service. Over the last twenty years of his career he specialised in Marketing and Corporate Communications and worked for Shell companies in a variety of primarily Communications assignments in The Netherlands, Scotland, Hong Kong, London and Dubai. He has travelled widely and during his time in Shell International in London he was the Project manager for the world’s largest brand re-imaging undertaking – Shell’s “Retail Visual Identity” (RVI) project. Paddy visited Shell companies in more than 50 countries during the development and implementation of RVI.

Between 1996 and 2002 Paddy Briggs was based in Dubai in the United Arab Emirates and from here he managed key aspects of Shell’s brand management across the Middle East region. This included the launch of the magazine “Shell in the Middle East”, as well as extensive Corporate and marketing Communications campaigns. In short, Paddy Briggs is an expert in Marketing and Corporate Communications on a global scale.  

http://brandaware.co.uk/

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