The Royal Dutch shell: an Anglo-Dutch conglomerate

The Royal Dutch shell: an Anglo-Dutch conglomerate

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Table of Content:

• Abstract:
• History of the Royal Dutch Shell Company:
• The Operation of the Royal Dutch Shell company:
• The Origin of the Name and logo of the Royal Dutch Shell:
• The Operational structure of the Royal Dutch Shell Company:
• Social Responsibility of Shell Pertaining to Global Environmental Pollution, Safety and Human Health:
• The Shell Corporate communications and Overstatement of its Oil reserves:
• Conclusion and Recommendation:
• References:

• Abstract:

The Royal Dutch shell is an Anglo-Dutch conglomerate that was formed in 1907 after the existence of the petroleum company referred to as the Royal Dutch Petroleum Company. It resulted from the merging of the company’s operations by the British fir referred to as “Shell” therefore, changed the company’ name into the Royal Dutch Shell. The company majored in the transportation and trading businesses. The company operated as a public limited company (plc) under the legal name “Shell”. The company traded as; lse; rdsa rdsb nyse in the oil and gas industry. The head office of the Royal Dutch Shell is located in London. The regional target of the Royal Dutch Company operation is worldwide. The company has had different CEOs since it was formed in 1907 in Netherland and the present CEO is called Peter Voser. The company’s chairman is called jorma ollila. The company presently majors its operations in petroleum products and other related products. Below is an analysis of the company’s financial position:

(i) Revenue      –    upwards of $368.056 billion as of 2010

(ii) Operating income       –      $35.344billion

(iii) Total assets                –     $322.560 billion

(iv) Total equity            –       $140.013 billion

The Royal Dutch shell: an Anglo-Dutch conglomerate:

• History of the Royal Dutch Shell Company:

The Royal Dutch Shell was founded in the 20^th century when the Royal Dutch Petroleum Company was merged by a British transport and trading company (Shell) in 1907. After the merging of the two companies, they formed a vast, worldwide targeting supplier of trading and transportation services that pertain to petroleum and the related products. By the year 1935, the company had employed a total of 180,000 people worldwide. The company has been formed by the uniting of two people each with his personal interests. The two people were Henri Deterding of the Royal Dutch Company that dealt in petrol and Marcus Samuel of Shell Transport and Trading Company. Despite the fact that they were from opposite ends, they managed to arrive at a common purpose.

After the formation of the two companies, Royal Dutch Petroleum Company made a claim of 60:40 in the company’s advantages in the control over the company’s management and alliances. After all that, the Shell and the Royal Dutch Companies become the major holding companies of the three major operation companies which are; the Anglo-Saxon Petroleum Company, N.V. De Bataafsche Petroleum Maatschappij, and the Asiatic Petroleum Company. When the companies joined forces and interests, they started a project of construction of storage facilities for petroleum and other related products and construction of tankers. This project aimed at creating an easy way of storage and transportation of petroleum and other related products (Royal Dutch/Shell Group 2012).

The 21^st century found the Royal Dutch Shell Company when it had undergone a wide range of changes both structurally and operationally. The disintegration of the company’s older shell and the formation of the new shell which is considered more formal took place in the year 1995. This is when the three-way matrix that was there from 1960s was dismantled and a new matrix was formed. This new structure was formed based on the operations carried out by the Shell companies “Vis-à-vis” after the decentralization of the older structure. Despite all this, the Group was to be maintained. In addition to that, the new structure of the company created a continuous distinction between the company’s governance and the company’s executive responsibility.

In the year 2004 in November, there had been a period of turmoil that had been caused by the company’s revelation, thus the company was requested to reconstitute and operate as a capital structure that was single. Therefore, the new company that was referred to as the other company’s parent was named “The Royal Dutch Shell plc”.  The Royal Dutch Shell which is found in the London Stock Exchange (LSE) has been regularly been listed among the best performing companies. The company had its major offices in three cities which are; Netherland, Hague and London. In July 20^th 2009, the company’s unification was completed. The Royal Dutch and the Shell as the company’s original owners had a 60/40 advantage of claiming for the company’s shares towards shareholders. Shell had a magnificent operation and this made it be awarded with a contract of production in South of Iraq in December 2009. This was the Majnoon oil reserve field which contained approximately 12 billion six hundred barrels of oil that was reserved.

• The Operation of the Royal Dutch Shell company:

The Royal Dutch Shell Group is a very large company with hundreds of its branch companies. It is ranked as the third world’s largest oil and gas Production Company. Despite the many branch companies of Royal Dutch Shell, the company has its central operation office in London where all of the other companies’ operations are run from. The present CEO of the Royal Dutch Shell is Jorma Olilla who was appointed in 2009. After the formation of the Royal Dutch Shell, the company’s CEO have been either Dutch or British but Ollilla become the first non-Dutch, non- British executive of the group. This means that there is a central management for the Royal Dutch Shell Company located in London. The company’s executive management group is located in its head office in London.

It was realized that the central management system could not run the management operations of all hundreds of Shell companies all over the globe; therefore, each branch has its management team that is linked to the Shell executive management grouping London.  Therefore, under the law, the Royal Dutch Shell is registered as a single economic entity. This is why its management and organizational operation is centralized and the operations of all its branches are operated as activities of one business group. Each of the Royal Dutch Shell’s branches has a management system that constitutes the following management outline:

• The Origin of the Name and logo of the Royal Dutch Shell:

The shell logo also known as the Pecten, is named after the shell Pecten Maximus (the giant scallop) that the design  logo is based on, with the red and yellow colors thought to represent the flag of Spain, from the  company’s early Californian trade which was a Spanish colony.

• The Operational structure of the Royal Dutch Shell Company:

Shell is a very vast company with hundreds of branches worldwide and, therefore, operating as a single business body would have been cumbersome. For this reason, it reached a time when the operation and management of Shell Company was split into four interpedently operating business sectors. This division was done with the aim of easing the operation and management of the Shell business. The four main sectors of operation under Shell operational structure include:

The first operational structure is the upstream international structure which is an operational structure of the Shell Company that deals in managing the businesses outside the United States of America upstream. Its purpose is search and recovers petroleum reserve regions, liquefaction and transportation of oil and gas. This operational system operates infrastructures that are mainly located upstream and the downstream.............