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Royal Dutch Shell CEO Peter Voser on a Swiss roll…

Introduction by John Donovan

It seems timely, in view of recent postings on our Shell Blog, to republish an article about Shell CEO Peter Voser authored by retired Royal Dutch Shell Executive, Paddy Briggs (right). It was first published on 27 July 2009. Paddy is currently a Member Nominated Trustee of the Shell Contributory Pension Fund.

On a Swiss roll…

By Paddy Briggs

Here’s the story. You are a Swiss accountant with a proven record of ruthlessness and synthetic business acumen. You are comfortable with numbers – that’s what you do – but you know little about the minutiae of the oil business. How can you be – you are not an “oil man” you are a “dollars man”. By guile, good fortune and the Peter Principle you find yourself at the helm of one of the world’s biggest oil and gas companies. You know that you will struggle with the difficult things – like creating an organisation that finds, develops, transports, refines and markets hydrocarbons. You know nothing at all about the oil and gas chain from exploration to consumption. You’ve never really worked in it – other than seeing spreadsheets which show you how much it costs. But you are now in charge. So what you do is retreat to the familiar world of numbers. That world where there is certainty – where something that costs “$100m” is only supportable if an adequate ROACE is assured. And where, even though future earnings are always, by definition, unpredictable you find a way of getting bogus certainty where there is none. By appointing more accountants and listening to them.null

And then there is the term over which you plan to steer the business. Everyone knows that the genetics of the oil business are very long term. To find oil (which costs money) and to develop that oil (which costs more) is within the special competences of Shell – always has been. But to harvest the oil and the gas and to generate the income streams you have to be patient. But how can you be patient if you want to show how macho and “profit-focused” you are? Cut, cut, cut. It’s what I do. And immediately the bottom line benefits. Never mind that in five or ten years we won’t have any new discoveries. Never mind that in a decade or so the reserves cupboard will be bare. I’ll be on a seven figure pension by then like Mark and Phil and Jeroen before me. Ha! and its sister non-profit websites,,,,,, and are owned by John Donovan. There is also a Wikipedia feature.

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