Workforce engagement
As with all the Code's provisions, boards must consider the size and structure of their business, including its international scope, and select an approach to engaging with the workforce that most practically delivers the underlying spirit and ambition of the Code.
The Code states that its use of the term "workforce" is not meant to align with legal definitions of workforce, employee, worker or similar terms. But for a global organisation bound by the laws of more than 70 countries, blurring the clearly prescribed legal definitions that affect complex issues (such as local health, safety, security and environment (HSSE) requirements, work contract terms, legal accountability, employment rights) or merging two definitions of the same term could have a notable impact on the business, its operations and its stakeholder relationships (including with suppliers). As a result, Shell considers its workforce to be employees of companies in the Shell Group. The Board also engages with others outside this group (for example, on site visits), and some of this engagement is shared in section "Understanding and engaging with our stakeholders".
Although our reporting and formal engagement focuses predominantly on our employees, all individuals working on Shell sites (including Shell offices) are required to undertake certain Shell training (for example, on matters relating to HSSE and the Code of Conduct). Adhering to the Life-Saving Rules and the Code of Conduct compliance obligations is included within our contracts with suppliers. The Shell Global Helpline is available for all workers to report matters of concern.
For many years, Shell has recognised the importance of engaging with its workforce. Engagement is especially important in maintaining strong business delivery in volatile times of change. We strive to maintain a dialogue between management and our workforce – both directly and, where appropriate, through employee representative bodies. Management regularly engages with the workforce through a range of formal and informal channels, including via webcasts and emails from the Chief Executive Officer (CEO) and other senior executives, webcasts, town halls, team meetings, face-to-face gatherings, interviews with Senior Management, internal social platforms and online publications via our intranet.
The Board considers effective engagement a key element of its understanding of the Company's ability to create value, because it recognises that our people are our greatest asset. Workforce views can help inform the Board on matters such as operational effectiveness, Shell culture, diversity, equity and inclusion, identifying risk and opportunity, and developing and delivering strategy.
The Board considers the current workforce engagement approach effective, and feedback from employees indicates that they too find the interactions valuable and worthwhile. The information provided in the following table gives examples of various methods of Board engagement.
Board's direct engagements with the workforce
Informal engagement – Board
NOMCO members met with various senior leaders and high-potential individuals throughout the year.
Off-site visits
Workforce engagements during Board and/or meetings off site.
Meeting talent/leadership teams.
The Chair undertaking staff engagement sessions.
Through these more formal engagements, the Chair and other Non-executive Directors (either individually or in groups) have deepened their understanding of how the Company's purpose, strategy and values are embedded in particular businesses, sites and countries. This continues to give insight into progress made, risks and opportunities. The benefits are mutual. The Board obtains direct insight into local business operations and projects, and local strengths and challenges. Our people have a chance to better understand the Board and to provide direct feedback on topics of importance to them, their business or function and their location.
Shell Netherlands
n June 2023, the Chair met with a cross section of employees representing different businesses, locations, tenture, and job groups at Shell sites in the Netherlands (NAM, Pernis, and Moerdijk). The purpose of the meetings was to see and hear about operations and their perspectives, including the implementation of Powering Progress in the Netherlands.
The two-way dialogue offered participants the opportunity to ask questions and provide feedback. The Chair also had dinner with approximately 20 members of the leadership of Shell Netherlands to hear their views on the longer-term opportunities for the Company strategy in the country.
Shell Canada
The Board and Executive Committee (EC) visited Canada in June for their annual off-site visit and Board meeting. The visit provided significant opportunities for workforce engagement over three days.
On the first day, the Board and EC met several Shell Canada leaders and staff during business-focused discussions covering each of the core businesses in Shell Canada. On the second day, the Board and EC visited LNG Canada in Kitimat BC where they met with a cross section of 50 Shell staff during a site tour and a lunch. The site tour provided opportunity to engage frontline employees in the field. Feedback received after the event suggested that employees enjoyed the opportunity to engage informally with the Board and EC members. On the third day, over lunch, the Board and EC met a cross section of 50 Shell Canada leaders representing different businesses, locations, tenure, and job groups.
Shell China
In September 2023, the Chair undertook his first visit to China in his capacity as Chair of the Board of Shell. This presented an opportunity for employees to meet him, and he took part in a panel-style staff engagement session with 100 Shell China staff.
On the same day, he presented the awards to the finalists of the Shell Eco-marathon in Beijing, and attended a dinner with Shell employees involved in the Shell Eco-marathon.
Shell Energy and Chemicals Park Rheinland, Germany
In November 2023, the Chair and members of the SUSCO visited Shell Energy and Chemicals Park Rheinland in Germany. They reviewed progress against the sustainability and non-financial aspects of the Company's strategy and engaged with employees.
Formal reports and information updates to the Board
Shell People Survey (anonymous survey facilitated externally)
Through the results of the Shell People Survey, the Board was provided with an update on employee engagement levels, and the quality and resilience of leadership across Shell's workforce. The Board was informed of a broad range of subjects, including principal metrics, with particular focus on rewards, working conditions/workload and reputation.
The Board considers the Shell People Survey to be one of its principal tools for measuring employee engagement, motivation, affiliation and commitment to Shell. It provides insights into employee views and has a consistently high response rate. In 2023, the response rate reached an all-time high of 88%, (up 1% from 2022). The Board also considers this engagement to understand, for example, how Shell is using the survey outcomes in: i) data analytics, for example, to identify potential correlative relationships between employee engagement and safety or ethics and compliance incidents; and ii) strengthening Company culture and values.
Senior Succession and Resourcing Review
The annual Senior Succession and Resourcing Review focused on the strength of senior leadership and plans for its development and succession, while highlighting the breadth, depth and diversity of its pipeline, the developing profile of the leadership cadre, and recruitment and attrition levels.
The Senior Succession and Resourcing Review also highlighted the effectiveness of succession planning, the impact of its associated execution, and the data-driven, integrated approach to leadership and leadership development. The review continues to focus on proactive management of Shell's talent pipeline, and on advancing Shell's diversity agenda with increased attention on gender, race and ethnicity, LGBT+ and disabilities.
Assessment of key trends and material incidents
Presented by Chief Ethics and Compliance Officer. This is based on the established channels for staff and others to file complaints or report on suspected breaches in relation to the Shell General Business Principles (SGBP), the Code of Conduct or any breaches of laws or regulations, including accounting control and auditing concerns.
The update covers Shell employees and our wider stakeholder base. The Board (also via the ARC and the SUSCO) obtains insight into incidents and reporting levels and remediation. These provide indicators of conduct risks and, together with the related Board reports noted below, suggest the strength of embedding and awareness of the Code of Conduct and SGBP obligations and employees' comfort levels in raising incidents.
Risks
The Board reviewed reports on Shell's top risks, external and internal trends and emerging risks.
Organisational culture
The Board has continued its discussion on the Powering Progress strategy, including powering lives. The Board also focused on diversity, equity and inclusion commitments.
Chief Ethics and Compliance Officer Report
Data and insights include information from the Global Helpline, the Shell Ethics and Compliance organisation and the Shell People Survey. The SUSCO continues to strongly support the work of the Chief Ethics and Compliance Officer, including the efforts to ensure a safe working environment where staff feel confident to raise any concerns in good faith.
The ARC is kept updated when matters highlighted through the Global Helpline are investigated. The ARC is also informed about the associated remediation. For more information see "Audit and Risk Committee Report".
Assurance activities
Assurance activities, including items raised by businesses and functions (through the Group Assurance Letters process) and assurance (from Internal Audit, HSSE, Ethics and Compliance, Reserves Assurance and Reporting), provide additional evidence to the Board of the commitment to high standards of risk management and internal control. The assurance activities ensure that work can be done safely, within regulatory frameworks.
The information provided within these reports further supports the Board's annual review of the effectiveness of the Group's system of risk management and internal control, and feeds into the Group scorecard, against which staff bonuses are calculated.
The Shell Performance Framework
In 2023, the Shell Performance Framework replaced the Shell Control Framework. More information on this can be found in the section "Other regulatory and statutory information".
Significant HSSE, Ethics and Compliance, and more broadly, business control incidents are brought to the attention of Senior Management and the Board through regular reporting.
During these discussions, the Board seeks to learn more from incidents and ensure that the business continues to drive safety performance.
