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Our strategy

Our Powering Progress strategy is to generate more value for our shareholders, customers and wider society as we work to become a net-zero emissions energy business by 2050. Our purpose – to provide more and cleaner energy solutions – drives our strategy.

Our strategy is built upon: generating shareholder value, achieving net-zero emissions, powering lives and respecting nature. At our Capital Markets Day in June 2023, we announced how we will put our strategy into action with a relentless focus on performance, discipline and simplification as we aim to deliver more value with less emissions.

We are building on our strengths in Integrated Gas, Upstream and Marketing. We will invest around $40 billion in leading Integrated Gas and advantaged Upstream assets over 2023-2025. This will help drive significant and resilient cash delivery, while helping to provide energy security. Over the same period, investment in Downstream and Renewables and Energy Solutions will be around $35 billion, of which $10-15 billion will be in low-carbon energy solutions, as we help to enable the energy transition.

Achieving net zero

The Paris Agreement aims to strengthen the global response to the threat of climate change by "holding the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels". Shell supports the Paris Agreement goal to limit the rise in global average temperature this century to 1.5°C above pre-industrial levels. To achieve this, urgent action is needed to reduce emissions across all sectors.

We are working to become a net-zero emissions energy business. This means net-zero carbon emissions from our operations. It also means net-zero carbon emissions from the energy products we sell (including those produced by others), which currently account for over 90% of the total emissions we report. We support a balanced energy transition where the world maintains a secure and affordable supply of energy, while building the clean energy system of the future. We want to play our part in the energy transition, purposefully and profitably.

We aim to partner with our customers, suppliers and governments to help decarbonise the energy system. Our integrated assets and supply chains are designed to provide a secure supply of energy for our customers, while also delivering low- and zero-carbon alternatives.

Our purpose

To power progress together by providing more and cleaner energy solutions

  • 1 of 4

    Generating Shareholder Value

    Growing value through a dynamic portfolio and disciplined capital allocation

  • 2 of 4

    Achieving Net-Zero Emissions

    Working with our customers and sectors to accelerate the energy transition to net-zero emissions

  • 3 of 4

    Respecting Nature

    Protecting the environment, reducing waste and making a positive contribution to biodiversity

  • 4 of 4

    Powering Lives

    Improving people’s lives through our products and activities, and supporting an inclusive society

Underpinned by our core values
of honesty, integrity, respect for people,
and our focus on safety

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Generating shareholder value

We aim to generate more value for shareholders through disciplined capital allocation and a focus on performance.

We aim to generate more value for shareholders through disciplined capital allocation and a focus on delivering strong performance. We seek to provide enhanced distributions through our progressive dividend policy and share buyback programmes, which together target shareholder distributions* of 30-40% of cash flow from operations through the cycle.

In 2023, total shareholder distributions* amounted to $23 billion, comprising $8 billion in cash dividends and $15 billion in share buybacks, and we generated $54 billion in cash flow from operating activities. This resulted in total shareholder distributions*of 42% of cash flow from operating activities*, around the upper end of our target range. Our capital expenditure was $23 billion and our cash capital expenditure* was $24 billion. We reduced our total debt to $82 billion and our net debt* to $44 billion as of December 31, 2023.

We aim to grow our price-normalised free cash flow* by more than 6% per year through 2030 and grow price-normalised free cash flow per share* by 10% per year through 2025. In 2023, we increased our dividend to $0.344 per share in the fourth quarter of 2023.

We are focusing on operational, financial and carbon performance, while maintaining our balance sheet strength. We take a disciplined approach to our portfolio and capital spending, aiming to invest where we have an enduring competitive advantage.

In 2023, we announced capital expenditure targets of $22-25 billion per year in 2024 and 2025 and targeted structural cost reductions* of $2-3 billion by end-2025. By the end of 2023, we had made $1 billion in structural cost reductions*.

* Non-GAAP measure (see Non-GAAP measures reconciliations).

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Achieving net-zero emissions

We aim to become a net-zero emissions energy business by 2050 and will work with customers to help them decarbonise.

We have a target to become a net-zero emissions energy business by 2050, purposefully and profitably. Our net-zero target covers emissions from our operations (Scope 1), emissions from the energy we buy to run our operations (Scope 2) and emissions from our customers' use of the energy products we sell (Scope 3). We have a target to halve Scope 1 and 2 absolute emissions from assets and activities under our operational control by 2030, compared with 2016 levels on a net basis. By the end of 2023 we had reduced our absolute emissions by 31% [A].

Our energy transition update includes an ambition to reduce customer emissions from the use of our oil products by 15-20% by 2030, compared with 2021 (Scope 3, Category 11) [B]. Our net carbon intensity reduction targets are: 9-12% by 2024, 9-13% by 2025, 15-20% by 2030, 100% by 2050 compared with a 2016 baseline.

We place a high priority on combatting methane emissions. Our target is to maintain methane emissions intensity below 0.2% for operated oil and gas assets (including liquefied natural gas) and to reach near-zero methane emissions by 2030. In 2023, we achieved this with methane emissions intensity at 0.05%. We have a target to end routine flaring from upstream operations by 2025, subject to the completion of the sale of The Shell Petroleum Development Company of Nigeria Limited (SPDC) [C].

We are transforming our business and selling more low-carbon products and services, and will work with our customers across sectors to accelerate the energy transition. We engage with governments and other stakeholders, including international organisations and industry associations, and participate in global events, such as COP28. Through this engagement we seek to support robust policies, legislation and regulations designed to generate the demand for investment in the low-carbon energy system.

[A] Reduced from 83 million tonnes of CO2e in 2016 to 57 million tonnes of CO2e in 2023.
[B] Customer emissions from the use of our oil products (Scope 3, Category 11) were 517 million tonnes CO2e in 2023 and 569 million tonnes CO2e in 2021.
[C] In January 2024, Shell announced an agreement to sell SPDC. Completion of the transaction is subject to approvals by the Nigerian government and other conditions.

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Powering lives

We work to power lives through our products and activities, and by supporting an inclusive society.

We seek to make a positive impact on the lives of people around the world. We help to power lives and livelihoods by providing vital energy for homes, businesses, and transport.

We support livelihoods by providing employment and training in the communities where we operate, and buying goods and services from local suppliers, contributing to a more inclusive economy. In 2023, we spent around $49 billion on goods and services from suppliers* around the world. Our activities generate revenues for governments through the taxes and royalties we pay, and the taxes we collect on their behalf. In 2023, taxes paid and collected* were $67 billion. This helps governments fund health care, education and other essential services.

Around 760 million people [A] in the world have no electricity and over half the world population has insufficient energy to lead a good life [B]. We deliver energy commercially, by investing in businesses that supply energy access in emerging markets; and socially, by investing funds, expertise and resources in access to energy programmes.

Shell aims to become one of the most diverse and inclusive organisations in the world. Our focus is on gender; race and ethnicity; lesbian, gay, bisexual and transgender (LGBT+); and disability. In 2023, representation of women in senior leadership [C] grew to 32%. Our 2023 Shell People Survey showed a result of 83 points out of 100 for all questions relating to diversity, equity and inclusion (DE&I). This suggests that overall our people feel ours is a workplace in which they belong, feel safe and respected, and have equal opportunities to progress and grow. We seek to respect human rights in all parts of our business. Since 2022, we have implemented practices to improve and maintain worker welfare for employees and contractors.

[A] International Energy Agency, SDG7: Data and Projections, 2023.
[B] UN Human Development Index, Approximately 75 GJ final energy per capita is the threshold where populations reach 0.8 on the UN Human Development Index which can be considered a good life.
[C] Senior Leadership is a Shell measure based on compensation grade levels. This measure is distinct from "senior manager" as per statutory disclosure requirements. See "Our people".
* Non-GAAP measure (see Non-GAAP measures reconciliations).

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Respecting nature

We aim for a positive impact on biodiversity, zero waste and using water, other resources and materials efficiently.

In 2023, we reviewed our progress and performance on respecting nature. We consolidated our respecting nature ambitions announced as part of our Powering Progress strategy in 2021 into the following themes: having a positive impact on biodiversity, aiming for zero waste and using water, other resources and materials efficiently.

We have already achieved some of the respecting nature commitments we set when we launched Powering Progress. Our commitment to reduce fresh-water consumption in highly water-stressed areas by 15% was achieved ahead of the target date of 2025. We have also conducted detailed assessments to inform our approach to fresh water and waste, which will be tailored to local conditions. We have concluded that our ambition to use 1 million tonnes of plastic waste a year in our global chemical plants by 2025 is unfeasible due to lack of available plastic waste feedstock, slow technology development and regulatory uncertainty.

The remaining commitments announced in 2021 have either been incorporated into our new Safety, Environment and Asset Management (SEAM) Standards, which take effect from mid-2024, or are included in the relevant business objectives and processes.

When planning new major projects, we conduct detailed environmental, social and health impact assessments. At the end of 2023, 89% of major installations operated by Shell were certified against the ISO 14001:2015 Environmental Management System, or were in compliance with equivalent environmental frameworks required by local regulations. We are pursuing certification for the remainder.

Air quality continues to be embedded in our environmental standards. We are developing a range of lower-emission choices for customers, from electric vehicle charge points to biofuels, to help people and companies use lower-emission modes of transport. We continue to explore how we can source responsibly in our supply chain.

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