HSSE & SP Control Framework

In Shell, health, safety, security, environment, and social performance (HSSE & SP) are vitally important to generating value. They are indispensable elements of our organisation. We have internal standards and a clear governance structure to help manage HSSE & SP risks and avoid potential adverse effects. These also help us to develop mitigation strategies aimed at ensuring that if an HSSE & SP risk materialises, we avoid the worst possible consequences and have ways to remediate any environmental damage. The Shell HSSE & SP Control Framework (CF) consists of mandatory manuals, which align with the Shell Commitment and Policy on HSSE & SP. Guidance documents, assurance protocols, and training materials support the implementation of the manuals. Our standards describe how key control processes need to be implemented, for example, to help make production safer and manage the care of equipment. The HSSE & SP CF applies to every Shell entity and Shell-operated venture. It defines requirements and accountabilities at each organisational level, setting expectations for the management of HSSE & SP risks. We aim to ensure that significant HSSE & SP risks associated with our business activities are assessed and managed to minimise them as far as reasonably practicable. Our subject matter experts provide advice and support businesses to improve HSSE & SP performance. The applicability of specific HSSE & SP CF requirements to contractors depends on the defined HSSE & SP risks of the material or services procured as determined by the contracting Shell entity in the context of the HSSE & SP CF. Contractors are required, through appropriate contract provisions, to adhere to either Shell requirements and standards, or applicable industry standards.

When planning new major projects, we conduct detailed environmental, social and health impact assessments. We routinely practice implementing our emergency response plans to potential events such as spills or fire, which pose a significant risk. The Shell Internal Audit & Investigation team provides assurance on the HSSE & SP controls to the Audit and Risk Committee.

Health, Safety, Security, Environment & Social Performance Control Framework

The HSSE & SP Control Framework defines mandatory standards, requirements and accountabilities.

The framework applies to Shell entities and Shell-operated ventures, including employees and contractors.

Assurance

The Shell Internal Audit & Investigations (SIAI) team is the single independent assurance organisation within Shell. Within SIAI, the HSSE & SP and Asset Management Assurance team provides assurance to the Board's Audit and Risk Committee on the effectiveness of the HSSE & SP CF through an audit programme.

We take care to invest responsibly in the energy transition and screen investments against multiple criteria. We expect joint ventures not operated by Shell to apply standards and principles substantially equivalent to our own and support them in doing so. We offer to help them review the effectiveness of their implementation. Even if a review is not conducted, we periodically evaluate HSSE & SP risks faced by the ventures that we do not operate. If a venture does not meet our HSSE & SP expectations, we seek to improve performance by working with our partners to develop and implement remedial action plans.

Divestments

When considering divestments, we collaborate with in-house and external experts, where appropriate, to conduct checks and examine key attributes of potential buyers. These attributes may include their financial strength, operating culture, HSSE policies and approach to ethics and compliance. We also consider risk management and people management processes and standards, community liaison practices, and social performance programmes.

Applicable attributes are assessed against Shell's policies and relevant local regulations. Divestments are often subject to the approval of regulators, which may in part depend on potential buyers' HSSE capacity, compliance record and asset stewardship capabilities.

Decommissioning and restoration

Decommissioning is part of the normal life cycle of every oil and gas structure. We work hard to close and dispose of installations in a safe, efficient, cost-effective and environmentally responsible manner. This includes restoring the surroundings of platforms and facilities in line with relevant legislation, while taking our own standards into account. We have decommissioning and restoration activities under way in Brazil, Brunei, India, the Netherlands, the UK and the USA. We seek to reuse, repurpose and recycle materials in decommissioning. At the end of 2023, we reported $19 billion on our balance sheet for current and non-current decommissioning and other provisions.

Shell invests in innovative decommissioning and restoration technologies both in-house and by funding third parties. For example, in the Netherlands, we have developed technology to deep-clean hazardous contaminants from unused pipelines. This allows us to sell the pipelines for reuse, such as piping hydrogen, or recycle them as part of our ambitions on circularity.