Shell Oil Company: Strategy and Implementation

Case Overview

FSG assisted Shell Oil Company in the development of a new social investment strategy and a comprehensive implementation plan.

The Challenge

The Shell Oil Company allocated a substantial amount of charitable dollars in U.S. communities where Shell employees worked and lived. At least 50% of the annual budget was discretionary, and could be utilized more strategically to create greater social impact and corporate benefit. FSG was engaged to facilitate a strategic planning process that developed a common vision for using philanthropy to optimize both business and social benefits, and to create the processes and infrastructure necessary for Shell to pursue a vision of more effective philanthropy.

Approach & Solutions

FSG began by conducting a landscape analysis based on interviews and surveyed the entire company to determine the nature and motivation of their giving – as well as the key business constraints encountered by the business. Most social investment efforts were primarily motivated by corporate citizenship and “banking goodwill” among key stakeholders, and were not addressing business constraints. Shell’s large initiatives lacked adequate strategic planning and created limited value beyond the dollars they donated and volunteer efforts were not leveraging Shell employees’ specialized technical and professional skills. Opportunities existed to consolidate decision making and increase both business and social impact.

FSG recommended that Shell adopt a portfolio strategy to social investment that consisted of a set of national proactive initiatives and a set of responsive corporate and community social investments. The national initiatives were focused on addressing key business constraints by developing a skilled and diverse workforce, building national awareness to combat the problems of erosion in coastal Louisiana, developing the skills of potential minority and women owned suppliers, and promoting stakeholder-industry dialogue.

To facilitate implementation of this strategy, FSG created roll out plans for each initiative as well as an overarching social investment organizational plan for managing various types of social investments. Under the new plan, national initiatives were to be designed, managed, and evaluated by dedicated personnel in corporate affairs. Responsive social investments at the corporate and community level were to be managed with greater focus and discipline through a consistent screening process utilized across Shell’s U.S. business units. Finally, local external affairs managers were to fund, manage, and evaluate all of their local social investments directly.

Shell’s new investment strategy led to greater social and business value. As the company began proactively addressing business constraints, leveraging the skills of its people, leadership, and ideas, and evaluating the business and social impact created with its investments, it built its brand and reputation through social investment successes.