Goal 1: Eradicate extreme poverty and hunger

What are we doing?

1. Core Business Activities

Producing and delivering modern energy for development: By 2050, we expect developing countries will need five times more energy than today. Exploring for, and producing oil and gas around the world will be key to meeting this demand because of their affordability, convenience and abundance. Our investment levels have more than doubled since 2000, to $32 billion (net of proceeds from divestments) in 2008 (see our Annual Report).

We are continuing to invest steadily in the big long-life projects and in the upgrades of our mature operations that together could increase our oil and natural gas production by 2-3% over the period 2009 to 2012.

Natural gas, the cleanest burning fossil fuel, could grow from 45% of our production in 2008 to more than half in 2012. In 2008 and early 2009, we increased our capacity in liquefied natural gas by nearly 25% compared to 2007.

We are delivering oil and gas to fuel growth in developing countries. The Malampaya project in the Philippines for example, supplies 30% of the electricity for the Philippines’ main island of Luzon. The Hazira LNG terminal provides clean burning gas to fuel growth in India and the North West Shelf Venture LNG (Shell 22.4%) will supply China’s first LNG terminal in Guangdong.

While our primary focus continues to be on delivering oil and natural gas responsibly, we have also made progress in developing alternative energy (see  Millennium Development Goal 7). In 2008, we increased our wind capacity by nearly a quarter to 550MW, and will focus our investments in alternative energy on biofuels because of their fit with our current business. We also supply liquid petroleum gas (LPG) and are part of The LPG Challenge – see Partnerships, policy dialogue and advocacy below.

Providing access to economic opportunities, revenues and taxes: Globally, in 2008, Shell collected over $94 billion in excise duties and sales taxes on behalf of governments on the fuel and other products we transported or sold. We paid another $26 billion in corporate taxes, and $2.3 billion in royalties on the oil and gas we extracted. We provide employment to over 32,000 people in low and medium income countries.

Promoting the use of local suppliers and contractors: In 2008, we spent an estimated $19 billion on goods and services from locally owned companies in low and medium income countries. We have programmes in place to actively promote the use of local suppliers and contractors in more than 90% of the low and medium income countries where we operate. In Nigeria, for example, Shell and the International Finance Corporation are participating in a risk-sharing credit facility to finance indigenous contractors operating in the Niger Delta.

Buying locally also helps create opportunities for minorities and women. In South Africa for example, in support of government policies, over 60% of our expenditure is with black economic empowerment companies and we continue to champion minority and female-owned businesses in the USA. Host governments sometimes set requirements for buying or hiring locally.

2. Social investment

Capacity building and micro-credit programmes: Based on an annual internal questionnaire to our senior country representatives it is estimated that we spent approximately $148 million on social investment activities in 2008. The largest programmes were in Nigeria and the USA. This amount is separate from the activities of the independent Shell Foundation (see below).

In Nigeria, a Micro-Credit and Business Development Programme promotes Micro, Small and Medium enterprises (MSMEs).

Many successful capacity programmes operate in the Philippines as part of the Malampaya project - opens in new window.

Globally, Shell LiveWIRE - opens in new window helps young entrepreneurs start and run their own businesses. Established in 1982 in the UK, the programme now operates in over 20 countries including Chile, Pakistan, South Africa, Sri Lanka.

Shell Foundation - opens in new window programmes to tackle poverty through market and enterprise based solutions: The Shell Foundation is supporting sustainable solutions to social problems arising from the links between energy, poverty and environment and from the impact of globalisation on vulnerable communities.

3. Partnerships, policy dialogue and advocacy

Combating bribery and corruption: In energy-producing countries, oil and natural gas revenues can bring widespread benefits, but managed badly, they can stimulate corruption, breed conflict and hurt the country’s competitiveness. We encourage and support host governments’ efforts to use energy revenues wisely. We support the Extractive Industries Transparency Initiative (EITI) - opens in new window that encourages energy and mining companies to publicly declare their payments to governments.

Participating in global and local partnerships to stimulate enterprise and provide access to clean energy:

• World Business Council for Sustainable Development (WBCSD) Sustainable livelihoods project: Researching the role that businesses and markets can play in improving the lives of impoverished people. Visit the WBCSD's page on Sustainable Livelihoods - opens in new window.
• The LPG Challenge: We participate in a public-private partnership between the World Liquefied Petroleum Gas Association and the United Nations Development Programme (UNDP) to expand access to cleaner LPG in rural and urban areas. Visit the UNDP website. - opens in new window
• Renewable energy and efficiency partnership: We participate in a coalition of governments, businesses and other organisations committed to accelerating the development of renewable and energy efficiency systems. Visit the REEEP website - opens in new window.

Shell Foundation enterprise solutions to poverty campaign.
Shell Foundation enterprise solutions to poverty campaign. The Shell Foundation has played a major role in promoting the role of enterprise in combating poverty through its publications on enterprise solutions to poverty. See the Shell Foundation website. - opens in new window