ShellNews.net: ALMOST 2 YRS AFTER THE RESERVES FRAUD, SHELL’S REPUTATION IS STILL RANKED IN THE CORPORATE GUTTER ALONGSIDE ENRON: "Sir Philip must qualify as the worlds greatest conman having pulled off a multi-billion dollar scam while retaining an $18 million dollar payoff/pension pot"
Friday 9 December 2005: 05.25am EST

By Alfred Donovan

SHELL RANKED 54 OUT OF 60 COMPANIES IN HARRIS INTERACTIVE REPUTATION STUDY PUBLISHED IN THE WALL STREET JOURNAL

The New York Times published a report today under the headline: “New Surveys Show That Big Business Has a P.R. Problem”.  John D. Hofmeister, who runs the United States operations of Shell Oil Company, is quoted as saying: "This is a challenging time for big corporations". The modern feeling, he said, is "big is bad."  That certainly appears to be the overwhelming public and stakeholder perception of Royal Dutch Shell.

This incidentally is the same John Hofmeister who posted a message on the “Tell Shell Forum” a few years ago applauding and encouraging its policy of open uncensored debate. I wonder what his thinking is now, after the facility has been suspended following exposure by me and other Tell Shell contributors of Shell’s secret censorship of postings by Shell employees? An innovative medium to encourage feedback has been ruined because Shell senior management does not want to hear the truth. Shell General Counsel Richard Wiseman confirmed to me by email last month that Shell has been censoring postings on the site.

How and why Shell’s reputation (and employee morale) has sunk so low

In 9 January 2004 the bombshell news about the reserves fraud broke and negative news about the scandal inundated the media on a continuing basis with the sackings of senior executives, regulatory and criminal investigations, class action law suits, followed eventually by multimillion dollar fines and settlements.

On 4 July 2004, The Sunday Observer published a company reputation assessment carried out by Thomson Intermedia. The survey and article (see link below) were based on monitoring company news in every UK national newspaper on a daily basis. It ranked the top ten brands/companies with the highest reputation and at the other extreme, the 10 “Worst”. No prizes for guessing Shell’s ranking; the Worst of the Worst.

The Observer: Bad publicity - not goodbye, but good buy: “Shell illustrates how a steady barrage of negative publicity can bring a company to its knees”: “The company's reputation is now in tatters”: "We list the latest batch of leaders and laggards in the corporate publicity league in the accompanying table. These rankings are based upon news reports in the last three months. The current '10 worst' list is led by Shell."

The publication of the Thomas Intermedia survey happened to coincide, almost to the day, with the launch by Shell of a defamation suit against Shell whistleblower Dr John Huong, a Shell geologist who had worked diligently for the company for 29 years. Dr Huong’s falling out with Shell management stemmed back to his decision to place on record, in a Shell internal document, his conscience drive concern about safety issues and the fabrication of reserves volume for the Kinabalu oil field where he was the production geologist. Dr Huong blew the whistle internally at Shell at a time when such deceit in regards to reserves reporting had only just started. That was in 1997. History might have been very different if Shell management had listened.

On 6 December 2005, The Wall Street Journal published the results of a corporate reputation study of 60 major companies by Harris Interactive. They confirm that Shell’s reputation remains in the corporate gutter literally ranked alongside the likes of Enron.

A BLIND EYE CULTURE

Instead of dealing properly with the reserves volume, Asset integrity and safety issues exposed by Dr Huong, Shell management preferred to turn a blind eye. Shell did the same in respect of other misdeeds happening elsewhere, including the theft of intellectual property, health and safety shortcuts which put lives at risk and a rigged tendering process. In the latter case, companies were deliberately cheated by Shell in accordance with a cunning premeditated plan to deceive participants who thought they had reached a final short list stage in a major contract tender.    

Small Shell shareholders and Shell dealers have also been adversely affected by Shell management misdeeds. The same applies to North American consumers who purchased tainted Shell gasoline and people living in many locations in the world which have been polluted by Shell’s operations e.g. Port Arthur in Texas and the Nigerian Delta.

The consequences of such a blatantly unscrupulous corporate culture brought about by a Shell management famed for its arrogance and denial has inflicted incalculable lasting damage to Shell’s reputation as the reputation surveys confirm.

Is there any real prospect of a turnaround when many of the same management figures tainted by the reserves fraud and other scandals and debacles, such as the massive Sakhalin II cost overrun, are still at the helm of Royal Dutch Shell Plc?

With regards to Sakhalin, we have on the one hand President Putin slamming Shell for letting the costs spiral out of control and on the other, an eminent scientist, Professor Richard Steiner from the University of Alaska marine advisory programme, resigning from the mega-project after branding Shell management as “clever, stubborn rascals”

Unfortunately Shell management still appears to exist in a fantasy land where logic, fact and basic human decency are perverted. It prefers hype, spin, deceit, intimidation, victimization and turning a blind eye to wrongdoing which suits Shell’s profitability and purposes i.e. safety shortcuts.

There is no better example of this type of unscrupulous corporate culture than the disgraceful conduct of Shell management in Malaysia under its ruthlessly ambitious Country Chairman, “Datuk” Jon Chadwick, ultimately responsible for the persecution of Dr Huong.  

SHELL'S FLAWED DEFAMATION CASE AGAINST DR HUONG

Shell’s case against Dr Huong is based mainly on his “postings” on “the website known as Whistleblower No2”. Shell allegations were in fact about information published on my website by me (and my son John) under the name of Dr Huong. The court papers submitted by Shell alleged that: "These posting were done on the website known as “Shell Whistleblower No. 2” which is accessible from the Internet anywhere, including Malaysia."

These are the facts, as opposed to the way Shell lawyers have deliberately twisted the truth:

1. The “Postings”:

No one, other than my son, John and me has ever posted anything on our website: www.shell2004.com.  Unlike Shell’s “Tell Shell Forum” (now suspended as mentioned above in the face of criticism of its censorship policies) we have never had a “blog” facility on our site. Hence it was impossible for Dr Huong to make any posting on our site as Shell’s court papers falsely allege. 

Consequently Dr Huong, a Malaysian national, had to supply drafts by email which John and I translated into readable English. Perhaps "translated" is too strong a term - readers can find at the foot of this article an example (from our archives) of an email  sent by Dr Huong to Sir Philip Watts and other Shell managers in July 2003. Some of the content is ironic e.g. Dr Huong seeking an assurance about compliance with Shell's ethical code at a time when Sir Philip was busy filing Form F-20 returns to the US Securities & Exchange Commission containing inflated reserves figures. (Sir Philip must qualify as the worlds greatest conman having pulled off a multi-billion dollar scam while retaining an $18 million dollar payoff/pension pot).

It is clear from his email that Dr Huong is a highly intelligent individual. However he accepted our invitation (insistence) on rewriting the draft material he submitted. Dr Huong relied on our judgment of what was suitable for publication on our website in terms of legality and otherwise. 

After speaking to him for hours by telephone we inserted into the articles our interpretation of the themes and conclusions that we believed he wished to convey. We were the sole editors and publishers of the relevant articles. Thus although the finished articles were very much a collaborative effort involving three individuals, my son and me, not Dr Huong, were responsible for the final published versions.

With the greatest respect to Dr Huong, we note that most of the comments cited in the Shell legal documents as being defamatory were originated by us, not by Dr Huong. They were either quotes taken from articles previously authored and published by us (without any legal action from Shell) or were original commentaries written by us arising from the discussions with Dr Huong.

Dr Huong relied on us as the publishers to post whatever we deemed to be legal and proper. It was entirely our decision, not his, on what was published on our site – a website over which he had no control or responsibility.

2. There has never been any website with the URL: Shell “Whistleblower No. 2”.

Shell lawyers were well aware of the various Shell related domain names used by our website, as became evident when they filed proceedings against me via the World Intellectual Property Organization in May 2005. They never cited the domain name “Shell Whistleblower No. 2” because no such domain name or website has ever existed. Far from complaining about the above alleged defamatory statements STILL published on the SAME website despite the Malaysian High Court Injunction and Restraining Order, Shell stated in writing in its submission to the WIPO that I am entitled to express my opinions and criticize Shell:“The... Group... have been aware of the site since the beginning and whilst they would not endorse or agree with many of the comments made by the Respondent on the website, they have taken the view that the Respondent is entitled to express his opinions and to use the Internet as a medium for doing so."

Shell deliberately misled the Malaysian High Court by pretending that it was possible for Dr Huong to post his articles on a website called "Whistleblower No. 2" which has never existed.  All because it does not wish to face my son and I in the libel courts. The following is an extract from a press statement released by Shell over 10 years ago (17 March 1995): -

During the past few months Mr John Donovan, the Managing Director of Don Marketing Limited, and his father, Mr Alfred Donovan, have conducted a publicity campaign connected with legal actions which Don Marketing has initiated against Shell U.K. Limited.

Don Marketing and the so called pressure group have repeatedly attempted to goad Shell into issuing proceedings against them for what they are doing. Shell has to date declined to do so.

Any regular reader visitor to this website will probably be astonished at our candid commentary about Shell and perhaps wonder why Shell management has not taken action against us in the libel courts, but instead has preferred to apply pressure by proxy i.e. Dr John Huong. The reason is that we have a mass of documentary evidence which confirms the deeply ingrained culture of cover-up and deceit which resulted in the reserves fraud and  other scandals which have destroyed Shell reputation. There is no libel if what is stated is the truth.

DOUBLE STANDARDS

Even after over 18 months have past, Shell has taken no action against the English owners (my son and I) of the website responsible for co-authoring, editing and publishing the alleged defamatory comments. Indeed, the above statement by Shell to the WIPO must include the comments which are the subject of the litigation against Dr Huong. So apparently it is one rule for Englishman (my son and I) and another for former colonials, such as a Malaysian national.

In view of the facts, as opposed to the twisting of the truth by a Shell Malaysian management determined on pursuing a vendetta against Dr Huong, Shell should bring an action against my son and I in the appropriate jurisdiction. If the published commentary is defamatory, which is denied -then we are far more responsible than Dr Huong. Without our extensive involvement on the basis described above the relevant articles would not have been published. We have a volume of evidence gathered over nearly a decade to support the comments made about Shell. In any event, our testimony in the form of witness statements and our documentary evidence will be made available to Dr Huong.

STATUS OF SHELL’S LIBEL LAWSUIT AGAINST DR HUONG

Court hearings regarding Shell’s case against Dr Huong were held on 2nd & 6th December 2005 in Kuala Lumpur. Shell launched proceedings against him in the High Court of Malaya, Kuala Lumpur, despite knowing that he lives 1300 kilometers away in Miri. In fact Dr Huong has lived in Miri for his entire life and worked at Shell’s offices in Miri. It is only a 5 kilometer journey from his home to the Miri High Court.

Dr Huong was understandably unable to attend the hearings in Kuala Lumpur because of the considerable costs involved– plane flights, hotels etc. Money is short because he has been unable to obtain alternative employment in his area of expertise while the Shell litigation hangs over his head. Shell has no problem with money. It is rolling in cash from record high oil prices and is apparently prepared to spend as much as it takes of shareholder money to destroy Dr Huong irrespective of ethical considerations. Shell has used the same unprincipled tactics against my son and me. 

Shell could have initiated the court proceedings in the Miri High Court but did so in Kuala Lumpur to put Dr Huong at a major disadvantage. That is morally wrong, unreasonable, and incompatible with true justice.

The outcome of the hearings is that Dr Huong must file his detailed response to the Defamation Writ before the question of an appropriate Court location can be reconsidered by the courts.  

Does not Shell management realize how devastatingly bad it looks when EIGHT Royal Dutch Shell companies have ganged up against a former employee. I have read Dr Huong’s correspondence with his senior colleagues before he was dismissed. My perception is that this was a case of an employee being stressed out by his work and what he considered to be grossly unfair treatment. Instead of giving him the help, support and reassurance he needed, Shell management did the exact opposite.  

It is notable that Dr Huong is far from alone in being a victim of Shell’s spiteful and inhuman treatment of its employees in Malaysia. There are a number of High Court cases which have been brought against Shell by groups of former Shell employees. The litigation is in respect of alleged wrongful deductions from employee pension funds. In one such High Court Action by 399 former employees, a Judge has already ruled in a 70 page judgment that Shell acted “UNLAWFULLY” in making the deductions. Shell is however deliberately dragging out the litigation, using every legal maneuver available (just as it is with Dr Huong) despite knowing that many members of the class action groups are elderly, sick and dying.

HUMAN RIGHTS VIOLATIONS

It is ironic that we jointly decided to publish in one of the articles now the subject of the litigation against Dr Huong, extracts from the United Nations Universal Declaration of Human Rights 1948.

The High Court Writ, Injunction & Restraining Order obtained by Shell required removal of the following extracts: -  

Article 1. All human beings are born free and equal in dignity and rights. They are endowed with reason and conscience and should act towards one another in a spirit of brotherhood.

Article 5. No one shall be subjected to torture or to cruel, inhuman or degrading treatment or punishment.

Article 12. No one shall be subjected to arbitrary interference with his privacy, family, home or correspondence, nor to attacks upon his honour and reputation. Everyone has the right to the protection of the law against such interference or attacks.

Article 19. Everyone has the right to freedom of opinion and _expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers.

Article 23. (1) Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.

The lawsuit brought collectively by EIGHT Shell companies puts Shell directly in contravention of these fundamentally important human rights which it has purported to support: more blatant hypocrisy on the part of Shell management.  

My conclusion is that there in no prospect of Shell acting in an ethical humane manner while the current discredited management with discredited hard-nosed policies remains in place. It follows that Shell’s reputation is likely to remain where it belongs, in the corporate gutter.  

EXAMPLE EMAIL FROM DR HUONG TO SHELL MANAGEMENT, JULY 2003 (6 MONTHS BEFORE NEWS OF THE RESERVES FRAUD MADE GLOBAL HEADLINES).

ARTICLE ENDS:

Related articles:

Disclaimer: 'The author (Alfred Donovan) ShellNews.net and the web site RoyalDutchShellplc.com are not endorsed by Royal Dutch Shell plc or affiliated with them in any way.' Published by: ShellNews.net, 847a Second Avenue, New York City, NY 10017, USA. Telephone No: +1 (646) 502-8756. Fax: +1 (646) 349-2605. The statements expressed here, and any opinions, are those of the writers alone, and neither are opinions of nor reflect the views of Shell2004.com. Content created by the writers is the sole responsibility of the writers and its accuracy and completeness are not endorsed or guaranteed. This goes for all links, too: Shell2004.com has no control over the information you access via such links, does not endorse that information, cannot guarantee the accuracy of the information provided or any analysis based thereon, and shall not be responsible for it or for the consequences of your use of that information.
 
Alfred Donovan has had business dealings with Shell stretching back almost 50 years. In the 1980’s & 90’s the sales promotion company he founded with his son, John (Don Marketing) created and supplied multimillion dollar national promotions for Shell on an international basis. He and his son probably hold the world record for suing Shell, having subsequently brought a series of court actions: five for breach of confidence or breach of contract, and two for libel. They have never lost a case against Shell. Details about the litigation are published on ShellNews.net, the unique website owned by the Donovan’s. It contains the world’s largest collection of articles, news and reports focused on Royal Dutch Shell and its activities – astonishingly, over 6,000 web pages. Mr Donovan own and uses the registration to the dotcom domain name for Shell’s unified $200 billion (USD) company: Royal Dutch Shell Plc (royaldutchshellplc.com). Shell made an unsuccessful attempt to seize it by instituting proceedings via the World Intellectual Property Organisation in May 2005. A WIPO panel gave a unanimous verdict in favour of Mr Donovan in August.

© 2004/5 ShellNews.net

Click here to return to ShellNews.net HOME PAGE