Catalyst, a nonprofit organisation seeking to expand opportunities for women and business, asked one of its board members, Peter Voser, Shell’s Chief Executive Officer, to close a European symposium. In his remarks Peter describes Shell’s efforts to promote diversity for the sake of its businesses throughout the world.

He points out that diversity is a necessary condition for commercial success, but it’s not sufficient. A diverse workforce must also feel involved, respected and connected to the company. Engendering that feeling of inclusion is difficult. Shell has made some progress, but further personal commitments – including from Peter himself – are needed.

Remarks at Catalyst Europe Symposium “Engaging & Retaining Women”

I’m delighted to join you here today. I understand that you’ve spent the day discussing what companies should do to gain the full benefit of having more women in their workforces.

I hope to hear your thoughts on this important subject. But first let me share with you some of my own thoughts on the matter.

Arguments for workforce diversity

Shortly after I became CEO, I asked all Shell people to focus on certain key behaviours that I thought were urgently needed for us to become the most competitive and innovative energy company.

One of them was external focus. That means understanding what our customers want and then delivering it – preferably in an original and compelling manner.

There’s no better way for a company to put itself into the customer’s shoes than to have a workforce that reflects the customer base. And we know our customer base is ever changing, with a growing number of women in decision-making positions.

Having a diverse workforce also enhances our “brand” appeal – the reputation we have not only among potential business partners but also among potential recruits.

There’s an additional bonus to having a diverse workforce. I believe a team of employees cutting across multiple dimensions of diversity ultimately yield better solutions to problems.

A recent issue of the Harvard Business Review highlights a study that showed that groups with around a 50-50 mix of genders achieved better scores in problem-solving assignments than either male-dominated or female-dominated groups.

By that measure, the Board of Directors of Royal Dutch Shell is in need of some adjustment. We’re working on it. Our shareholders approved the appointment of Linda Stunz as our second woman to the Board at our Annual General Meeting a few weeks ago.

At the executive level, we keep a close eye on the percentage of women in senior leadership positions. At the end of last year, the proportion of women in such positions was over 15% – up from 10% in 2005, but still short of the 20% target we set ourselves.

Why should Shell be concerned about the percentage of women it has in senior positions? Well, I’ve already indicated that a higher percentage aligns our corporate thinking with that of our customers and key stakeholders,  and stimulates better decision-making. But there’s another reason: employee attraction and retention.

Women in senior positions serve as role models for women in junior levels of the organisation. They inspire women to reach for ever-higher levels over a long-lived career.

Think what women in the Middle East will make of Intisaar Kindy, an Omani mother and professional geologist who, for the last two years or so, has been the Shell Country Chair in Jordan. She has just been appointed as Exploration Director of Petroleum Development Oman, one of Shell’s largest oil and gas joint ventures in the Middle East. There, she will be joining two other women on the venture’s top executive committee.

We’re actively trying to identify female talent like Intisaar early in the pipeline and prepare them for future leadership roles in Shell. That’s not something the oil and gas industry has always got right. We want to make this a competitive advantage and attract and retain more than our fair share of the top talent.

Promoting diversity

To help women articulate their professional and personal goals, we encourage women throughout Shell to attend our women’s career development programme. In addition to the skills acquired to become more effective leaders, it offers women the chance to network with other Shell women – including senior leaders. More than 2,000 have already attended.

We’ve taken other proactive steps to accelerate progress. We have made sure to build in “reality checks” in all our talent reviews and resourcing decisions. For example we’ve set an expectation for diversity in the short lists of candidates prior to selection for senior positions. Our HR organisation sees to it that these shortlists include at least one qualified woman.

Of course, gender isn’t the only diversity target that Shell has. We aim to have local people fill more than half the senior management positions in every country in which Shell operates. That’s more than 90 countries. But we’ve also made some progress there too. Currently, over 35% of the countries in which we operate have a majority of local nationals in the leadership positions.

These global targets – and our year-by-year results on our way to reach them – are published in our annual report. Our female talent pipeline – the percentages of women in supervisory and managerial positions – is also there for anyone to see in our sustainability report.

We are transparent about these numbers, because they back up our commitment to make progress in these areas for the sake of our business. They also reflect our global approach to the issue of diversity.

Working inclusively

Some people think that you’re being inclusive as long as you’re aware of the diversity of your workforce. I don’t think it’s as simple as that. It’s not just a matter of acknowledging that differences exist. It’s a matter of making everyone feel involved, respected and connected to the company.

Our capacity for leveraging diversity depends on our capability to work inclusively. One without the other won’t yield the commercial success we’re looking for.

But you don’t find inclusion in numbers; you find it in behaviours. And that makes it tricky to implement.

Inclusion at work is a theme that elicits different responses around the world. Can an international company adopt a single global approach to an issue that varies from country to country?

I believe it can. At Shell, we accommodate cultural variances in our approach by adhering firmly to more fundamental principles: our core values of honesty, integrity and respect for people.

But what about measuring it? How does a company know that its employees feel as though they are an integral part of the company?

At Shell, an annual survey measures employees’ perception of their inclusion in company affairs. The measurement is an average of the strength of their agreement with five statements in the survey. For example: “Where I work, we are treated with respect”. Or: “I believe my organisation has a working environment in which different views and perspectives are valued.”

In 2010, a solid two-thirds majority felt positive about their inclusion. What’s more, there was virtually no difference between male and female responses.

Learning to engage

I’m encouraged by such results. But we can do better. So we’ve been focusing on teaching people – particularly our leaders and potential leaders – how to create a work environment in which all employees feel engaged. By “engaged” I mean proud to work for Shell; aligned with Shell’s core values and business goals; and willing to commit extra time and effort to the sustained success of Shell.

There’s probably no perfect way to guarantee inclusion of women in a company’s workforce. It’s something we must continually work at and pay attention to. 

I personally am committed to making a contribution to inclusion at Shell, and so I certainly am conscious of the need to align my behaviours with my message. 

During my many travels visiting Shell companies around the world I make a point of having informal meetings with selected staff. They let me know how well our policies with respect to gender, ethnicity and local hires are being put into practice.

I also have formal discussion about these topics with my fellow directors and senior managers. By making my expectations clear, I hope that they will move Shell forward in the right direction – and at a faster speed.

We’ve made some progress over the last few years, so clearly some of the talk has led to action. But I’m also sure that we can do more.

Thank you for listening to my views on our journey to date, and I welcome any reactions or questions you may have with the time we have remaining.