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Managing HSSE 1

HSSE in shell
People who work for Shell drive nearly 1.5 billion kilometres a year to deliver
fuel and other products. They build new plants in extreme conditions, work on
remote offshore platforms, and run refineries and chemical plants.

Keeping people safe is our top priority. We aim to have zero fatalities and no
incidents that harm people. We aim to make sure our operations are safe and
reduce our impact on the environment and our neighbours.
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MANAGING HSSE

To achieve continuous performance improvement All Shell companies, contractors and joint ventures under our
Shell companies manage health, safety, security, operational control must manage HSSE and social performance
environment and social performance in a in line with the Commitment and Policy, local laws and the
systematic way. terms of relevant permits and approvals. To help our staff and
contractors to put the Commitment and Policy into practice we
At Shell, we aim to help meet the energy needs of society in launched the Shell HSSE & SP Control Framework in 2009.
ways that are economically, environmentally and socially It includes a set of mandatory standards and manuals covering
responsible. To manage the impact of our operations and areas such as managing greenhouse gas emissions, impacts on
projects on the environment and society we have a biodiversity, road safety and security.
comprehensive­set of business principles and rigorous
standards covering health, safety, security, environment (HSSE) We also include requirements for integrating environmental and
and social performance (SP). social factors into the way we plan, design and take investment
decisions on new projects.
Our business principles provide high-level guidance and the
Commitment and Policy on HSSE & SP reflects our aims on how shell.com/standards
we operate and involve communities close to our operations. shell.com/safety
Those aims include:

n do no harm to people;
n protect the environment; and
n comply with all HSSE laws and regulations.

HSSE & SP Control Framework


Managing HSSE 3

HSSE risks and assurance

We identify the HSSE risks associated with our they have applied our business principles and standards, and
business activities and work to reduce these risks the effectiveness of the controls in place. Shell Internal Audit
through mitigating controls. investigates fraud, compliance and other control incidents. We
report on our HSSE policies and performance to the Executive
We work to reduce the HSSE risks associated with our Committee and the Board of Royal Dutch Shell plc. Our process
business activities. safety specialists do conduct dedicated safety audits.

Business managers in Shell are accountable for identifying All our major plants are externally certified to international
HSSE hazards, assessing and documenting their potential environmental standards, including ISO 14001. External
impact, and reducing or eliminating risks using controls and panels and observers help us monitor environmental and
recovery measures. social performance.

We audit our businesses and seek assurance that HSSE & SP


requirements have been implemented and are effective.
The heads of our businesses and functions are required to
report to the Chief Executive at the end of each year on how

The ‘Bow Tie’ Model

The ‘Bow Tie’ Model illustrates the importance of both preventive and recovery measures in
dealing with risk. Risk is defined as the likelihood that a Top Event (hazard release) will
occur, combined with the severity of the consequences of the event:

CONSEQUENCE
H
A SCENARIO

Z Top CONSEQUENCE
A Event
R THREAT
D CONSEQUENCE
CONTROL RECOVERY
BARRIERS MEASURES

Prevention Mitigation
■ keep within control limit ■ mitigate consequences

■ reduce likelihood ■ plan for recovery/re-instate

Risk Management Responses

Hazard: Potential to cause harm.


Threat: A possible cause that will potentially release a hazard and produce
a ‘Top Event’.
Control Barriers: Measure to prevent threats from releasing a hazard.
Top Event: The ‘release’ of the hazard, i.e. the first consequence.
Recovery Measures: Limit the consequences arising from Top Event.
Consequence: Event(s) that result from the release of a hazard.
4 Managing HSSE

Complying with HSSE rules

Our mandatory 12 life-saving rules


OUR MANDATORY 12 LIFE-SAVING RULES
Obtain
Verify isolation authorisation
before work Obtain before
Work with a begins and use authorisation overriding or Protect yourself
valid work Conduct gas the specified life before entering disabling safety against a fall
permit when tests when protecting a confined critical when working
required required equipment space equipment at height

Do not walk Do not smoke No alcohol or While driving, Wear your Follow
under a outside drugs while do not use your seat belt prescribed
suspended load designated working or phone and do journey
smoking areas driving not exceed management
speed limits plan

We are building a strong safety culture. We put We launched our mandatory 12 Life-Saving Rules in 2009 as
extra focus on managing the most critical HSSE a way to increase the focus on critical safety risks within Shell.
risks. We work to mitigate these risks by The rules prescribe what employees and contractors must know
enforcing compliance with vital controls, and and do to prevent serious injury or fatality, for example: wear
effectively checking that controls are in place seat belts and do not speed or use mobile phones – even
at all times. hands-free – while driving. If rules are broken, employees face
disciplinary action up to termination of employment, while
Over the last five years Shell has significantly improved its contractors can be removed from the site and barred from future
HSSE performance. Our major construction projects have been work from Shell.
setting safety records and we saw our lowest-ever rate of
injuries across the company in 2009. To keep our employees We also simplified our safety requirements when we launched
and contractors safe we are focusing on improving compliance the Shell HSSE & SP Control Framework in 2009 (see page 2).
with HSSE rules. It is a single, mandatory source for rules covering critical risk
areas such as process and road safety, occupational health
and working at height or in confined spaces. While the Control
Injuries -Total Recordable Case Frequency Framework was launched in 2009, its standards and manuals
include all of the HSSE requirements we have followed in the
past, such as our industry-first biodiversity standard.
Managing HSSE 5

HSSE competency

We provide ongoing training to ensure that our HSSE Leadership by Shell employees and contractors at every
commitment to excellence in HSSE management is level contributes to strong HSSE performance. We measure
reflected throughout Shell. Health, safety, security HSSE leadership through the annual appraisal process and
and environmental performance are key factors assurance system.
in evaluating and in selecting contractors.
Training is provided through the Shell Open University to
Strong HSSE performance depends on a competent workforce. develop staff skills in HSSE. Comprehensive programmes are
We want individuals carrying out tasks to be trained, medically also in place tailored for specific activities, for example
fit and sufficiently rested and alert. working offshore, and for high-risk areas such as road safety.

Shell’s HSSE competence requirements are based on legislation


and industry standards, and are specified in the Shell HSSE &
SP Control Framework.

We check that everyone responsible for tasks with a significant


HSSE risk has the necessary training and skills. This includes
people responsible for frontline operational HSSE critical
activities, those planning and supervising HSSE critical
activities, HSSE professionals and those in leadership positions.
6 Managing HSSE

Peter Voser at Pernis refinery, Netherlands 2009


Managing HSSE 7

Cautionary Note Shell and could cause those results to differ materially from those expressed in the forward-
The companies in which Royal Dutch Shell plc directly and indirectly owns investments are looking statements included in this publication, including (without limitation): (a) price fluctuations
separate entities. In this publication “Shell”, “Shell group” and “Royal Dutch Shell” are sometimes in crude oil and natural gas; (b) changes in demand for the Shell’s products; (c) currency
used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries fluctuations; (d) drilling and production results; (e) reserve estimates; (f) loss of market share and
in general. Likewise, the words “we”, “us” and “our” are also used to refer to subsidiaries in industry competition; (g) environmental and physical risks; (h) risks associated with the
general or to those who work for them. These expressions are also used where no useful identification of suitable potential acquisition properties and targets, and successful negotiation
purpose is served by identifying the particular company or companies. ‘‘Subsidiaries’’, “Shell and completion of such transactions; (i) the risk of doing business in developing countries and
subsidiaries” and “Shell companies” as used in this publication refer to companies in which countries subject to international sanctions; (j) legislative, fiscal and regulatory developments
Royal Dutch Shell either directly or indirectly has control, by having either a majority of the voting including regulatory measures addressing climate change; (k) economic and financial market
rights or the right to exercise a controlling influence. The companies in which Shell has conditions in various countries and regions; (l) political risks, including the risks of expropriation
significant influence but not control are referred to as “associated companies” or “associates” and renegotiation of the terms of contracts with governmental entities, delays or advancements
and companies in which Shell has joint control are referred to as “jointly controlled entities”. in the approval of projects and delays in the reimbursement for shared costs; and (m) changes in
In this publication, associates and jointly controlled entities are also referred to as trading conditions. All forward-looking statements contained in this publication are expressly
“equity-accounted investments”. The term “Shell interest” is used for convenience to indicate qualified in their entirety by the cautionary statements contained or referred to in this section.
the direct and/or indirect (for example, through our 34% shareholding in Woodside Petroleum Readers should not place undue reliance on forward-looking statements. Additional factors that
Ltd.) ownership interest held by Shell in a venture, partnership or company, after exclusion of may affect future results are contained in Royal Dutch Shell’s 20-F for the year ended December
all third-party interest. 31, 2009 (available at shell.com/investor and www.sec.gov ). These factors also should be
considered by the reader. Each forward-looking statement speaks only as of the date of this
This publication contains forward-looking statements concerning the financial condition, results publication, June 2010. Neither Royal Dutch Shell nor any of its subsidiaries undertake any
of operations and businesses of Royal Dutch Shell. All statements other than statements of obligation to publicly update or revise any forward-looking statement as a result of new
historical fact are, or may be deemed to be, forward-looking statements. Forward-looking information, future events or other information. In light of these risks, results could differ materially
statements are statements of future expectations that are based on management’s current from those stated, implied or inferred from the forward-looking statements contained in this
expectations and assumptions and involve known and unknown risks and uncertainties that could publication.
cause actual results, performance or events to differ materially from those expressed or implied in The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in
these statements. Forward-looking statements include, among other things, statements concerning their filings with the SEC, to disclose only proved reserves that a company has demonstrated by
the potential exposure of Royal Dutch Shell to market risks and statements expressing actual production or conclusive formation tests to be economically and legally producible under
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forward-looking statements are identified by their use of terms and phrases such as ‘‘anticipate’’, publication that SEC’s guidelines strictly prohibit us from including in filings with the SEC. U.S.
‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘objectives’’, ‘‘outlook’’, Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575,
‘‘probably’’, ‘‘project’’, ‘‘will’’, ‘‘seek’’, ‘‘target’’, ‘‘risks’’, ‘‘goals’’, ‘‘should’’ and similar terms available on the SEC website www.sec.gov. You can also obtain these forms from the SEC by
and phrases. There are a number of factors that could affect the future operations of Royal Dutch calling 1-800-SEC-0330.

Published June 2010


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8 Managing HSSE