By Chris Logan and Robert Stiphout

In his nine years as CEO, Ben van Beurden has dealt with some of the biggest challenges any business could face: COVID-19, Russia’s invasion of Ukraine, setting Shell on a path to net-zero carbon emissions. As he prepares to step down at the end of the year, he reflects on his career, and offers some parting thoughts.

How do you feel about your 39-year career at Shell as it comes to a close?

I feel pride, but I also feel very lucky. I became an engineer because I thought it was wonderful to work on big, important stuff. Then you get to do that in your career: to work on very large projects, to travel around the world and later on, to do business deals that really matter. Then to figure out how you respond to challenges like climate change and energy transition. All of this is so big and important. I have so enjoyed working in this industry and feel it a huge privilege to have led Shell. 

What are your proudest achievements as CEO?

That this large, complex organisation has more strategic clarity than we’ve had ever before. In the end, it’s the role of a leader to try to achieve that.

Also, when it comes to the safety of our operations, we have had a reduction in process safety incidents over my tenure of nearly 80%, an amazing amount of progress.

And we have made progress in other areas as well, such as gender diversity. There’s always more work to do on this, but in my time we have come from 17% women in our top 1,200 to around 30% women at that senior level. 

What have been the defining moments in your career?

I loved every job that I did: working on the design of a liquefied natural gas plant, the chemicals operations in Pernis, a very challenging refining operation in Sudan, then going to Malaysia to be Operations Manager.

But what was really defining for me was my first commercial job. I had worked for 17 years for Shell in technical, design and operational jobs. All of a sudden, the company gave me the opportunity to work in a commercial area, selling LNG in Mexico, the Altamira project. This was an eye-opener, an incredible learning opportunity. Without it I don't think I would ever have made it anywhere near this office.

Before moving to that role I had been called into an assessment centre for the development of leadership skills, which was a total train wreck. In my very first job interview at Shell, after I had graduated from Delft University, I had said I wanted to go to the very top. But now it became clear that I had some gaping holes in my CV and my skillset, so the feedback was: “This is the end of the road for you, my friend. In fact, we don't quite understand how you made it to here in the first place.”

That was a massive reset moment. I knew I had to take charge of my career. So I went into the commercial role and I found another path, strategic rather than operational. 

Getting the opportunity to run Chemicals was another big highlight. I remember in 2006 when Jeroen van der Veer, who was then CEO, said: “Ben, Chemicals is important and strategic for Shell. It's not doing well, you are probably the last person to be given the chance to turn it around.” Again, it was one of these defining moments where you think, I either make something of this or I shall exit Shell together with Chemicals.

It teaches you a number of lessons in ownership. Just doing your best is not enough, it's a must-win and there is only one person who can do it and that is you. The acquisition of BG was another example, probably the biggest business achievement, if you like. It had similar characteristics in that, if you succeed, it's great and if not, it may well be game over.

Are there things that you would do differently, with hindsight?

Did I get a few really big things wrong? Not in the sense that I thought, I should not have done that. It’s more that I should have done it earlier. In the end, and this is probably a little bit the story of Shell in general: we try to do the right thing as a thoughtful, committed, honest company, but sometimes we just take too long. That also applies to me. If I look back on certain decisions, it took a bit too long for the head to catch up with the heart. 

The lesson is, if you know what the right outcome is then just go for it. There are some things I look back on where I could have made a decision earlier, such as pulling out of the Arctic in 2015. We could have done that earlier and faster. 

The Board’s decision to cut the dividend in 2020 was painful. Moving the headquarters out of my home country, The Netherlands, is not exactly something you do with pleasure, but it was a positive move to simplify our share structure and allow us to make investment decisions faster. In both those cases I didn't see an alternative. 

In early 2021 you launched Shell’s strategy, Powering Progress, to transform Shell for the future. Are we transforming fast enough? Is the world transforming fast enough?

The progress society is making in cutting carbon emissions is not fast enough. And to a very large degree, of course, we are beholden to society. Shell has set a target to halve our absolute emissions from our operations by 2030, we have a strategy to become a net-zero emissions energy business by 2050 and I am totally convinced that we can do this. So I do believe we are in step and aligned with everything that the Paris Agreement could expect from companies like us.

But, when it comes to the emissions of our customers, it becomes more complicated because you do not control those. You have to change your customers, or your customers have to change the type of energy they use. For that, they have to change their car, their house, their factory, their lifestyle or whatever, so you cannot just say, “I'll do that for you".

The energy transition is a bigger challenge than the Industrial Revolution. You can only get it done in the timescale needed if governments intervene and put in place the right policies to encourage consumers to buy low-carbon products. It is not just that governments should put a price on carbon. That's just one thing. Governments should really help to orchestrate the transition with clear policies and mandates, especially on the demand side. 

We at Shell then have to be the innovators, we take risks and overcome challenges with new business models; these are the things that we do as a business. But we must also help advocate for the right government policies that will allow or encourage us to take these risks.

How do you feel now about the ruling of the District Court in The Hague in 2021 that Shell must reduce carbon emissions more swiftly by 2030?

I still feel the same, that we should rise to the challenge of the 45% reduction in our own emissions. In fact, we set a new target to reduce absolute emissions from our operations by 50% compared with 2016 levels.

Will it be straightforward? No, but if you want to get to net zero, having a target of 50% reduction in our own emissions by halfway, 2030, is appropriate. That’s why I said we shall rise to that challenge and we shall do our part to be a Paris-aligned business. 

As we wait for the outcome of the appeal, we’re taking steps to comply with the ruling. The part relating to emissions from the use of our products (Scope 3) is unreasonable. A 45% reduction is totally out of line with the rest of society. For the customers Shell serves, mainly in the industrial and transport sectors, we are being asked to go twice as fast as the European Union, in a shorter timeframe and worldwide. That’s while the EU has one of the most ambitious policy pathways in the world. Secondly, it’s not clear how Shell can be ordered to reduce emissions from customers who are not under a similar legal obligation to reduce their emissions. So I believe we have a duty to appeal. 

Over the weekend following the invasion of Ukraine on February 24th you decided to pull Shell out of Russia after 130 years of operations there. How did you reach that decision?

It was a very tough discussion. I have worked hard on building up our business in Russia and connecting the business with Europe, partly in the belief that energy interdependence and economic interdependence would be a geopolitical stabiliser.

That weekend it was a massive step to say to ourselves, hold on, everything now changes. Can we really continue as we are? On the Saturday, we were taking steps to make sure that people were secure and safe. On the Sunday, we were thinking we can't go on like this, because it is not as if we have some independent business in Russia. We are there in ventures mostly with Gazprom, which is a state entity, so we are deeply connected with the Russian government that is making choices with which we don’t want to be associated.

By Sunday evening, I had concluded that this was untenable and that we needed to make a break. On Monday morning, I spoke to our Chair and the Executive Committee members with the view that we had to get out of there. We announced it that afternoon. The decision was one where the head and the heart came together quite quickly. But implementing it was really difficult, and is still difficult to this day. It was a momentous decision for the company.

And then you had to worry about what was going to happen to our staff in Ukraine and Russia?

Yes, they both had their own dimensions. How can you help our Ukrainian staff if they are being confronted with military aggression, or trying to fuel convoys of refugees as they leave the country? What we ended up doing was to help people as best we could, including people who had fled to neighbouring countries, and the vast majority of our people who stayed. We could definitely help them by saying, don't worry about the financial side of things. We told them we were not walking away from this, far from it. They’ve done an outstanding job to help keep the country moving in the most desperate of circumstances.

In Russia we had to make choices to protect people, and it felt like a heavy responsibility.

Ben van Beurden with colleagues at a farewell event in Singapore

The move away from Russian oil and gas since the invasion has refocused countries on the need for secure supplies of energy, and an acceleration of the transition to renewables. What is your view of the new energy landscape?

For a long time, the only discussion that people were prepared to entertain with us was that you need to be more sustainable, you need to invest more in making clean and green, low-carbon products. And we get all of that and we are doing this. But that is not the full story. Energy is not just a matter of whether it can be cleaner. It also has to be available and affordable. Can all these things come together? Yes, but often one comes at the expense of the other. What we have seen over the last 10 years ignores that reality because of the almost exclusive focus on cleaner energy rather than also available and affordable energy.

Given the volatility of the energy industry and the need to invest for the long term, why have you been so open about the need to accept windfall taxes?

It’s just realism. The most vulnerable in society cannot afford the energy prices that we have been seeing. I don’t subscribe to the harsh view that the market will sort all of that out, that the best remedy against high energy prices is high energy prices. We should be grateful that we have governments that intervene.

We should be prepared to talk about it, which we have been doing, but we have also said it needs to be done in a way that creates incentives for investments in the energy transition and energy security.

You led the company through COVID-19. What was that like, and how did Covid affect you personally?

It was unreal, but that was the case for everybody. And unexpectedly, we seemed to have improved as a business in many areas. We discovered new ways of working and in many areas we actually did better than before Covid.

For me it was back-to-back calls all the time, so I found it a very tiring experience, both emotionally and physically. That was the professional side.

Personally, being holed up in the house helped to reset the family a little bit. Home schooling and having three meals a day together as a family was a totally new experience for all of us, and I am sure the same goes for many other colleagues. I remember three or four months into it, my wife said: “I am not so afraid any more of your retirement with you being at home all the time, I think it could work out quite well.”

You’ve said George Floyd’s killing by a police officer in Minneapolis, USA, in May 2020 and its aftermath were “a wake-up call” for you as a leader. Is Shell doing enough to be a fair, diverse and inclusive company to work for?

I do believe that we are more diverse, and ethnic diversity has also improved. But we can still do more to make sure we are totally inclusive and free of bias and bigotry.

George Floyd’s terribly sad death gave people in our company the conviction to speak up, to reach out and say this is what is going on. You find out that racism is not a societal problem only. Workplaces, like Shell, are not exempt.

In the aftermath, I realised that it is not good enough to say, “I'm not a racist” or “my organisation, my team or whatever else is not racist”. You have to be anti-racist, which means that you have to examine deeply whether you have any unconscious biases, whether there are micro-inequities in your organisation, or large inequities in your organisation. 

All these issues have become much more exposed and we are working harder to engage, talk, find out, no matter how uncomfortable this might be. We need to be really clear about our expectations, and I felt that I had to be really clear about the total intolerance of discrimination. But we have more work to do. It’s not something we can solve quickly.

If you could give your younger self advice on your life and career, what would you say to the recently graduated chemical engineer Ben van Beurden?

It comes back to the head and the heart point. If you are clear in your heart, don't wait too long before your head comes to the same conclusion.

The other thing is a bit of personal clarity. You need to be really clear at the beginning of a new role what is it that you want to achieve in that role, or what you are uniquely placed to achieve. 

I must admit that, in my first few jobs in Shell, that personal clarity wasn't there at all, it came afterwards and it quite often came when I thought, I missed a trick here. Over time, it improved, certainly when I got the CEO job, I made sure that I spent a lot of time thinking about what do I really want to achieve here. It is not that it always works out as you have planned but at least you have a plan. Have a plan is probably the advice.

So what is your plan for life after Shell?

Now I have to sin against my own principle, because I don't have a plan! This is a conscious decision. It has been quite a demanding nine years for me and the family, so I have followed the advice that many people gave me, that when you step down and all these people come to you with job offers, ideas or whatever else, say no to everything. I’ve done that so far. It's a bit scary but I quite like the prospect of having six or 12 months of enjoying life in a completely different way, rather than trying to get satisfaction out of work.

You have to work on your career, you have to maintain your family and you have to maintain your friendships. Often it felt that if you really try hard, you can do two of the three, but you can't do it all, so there is a little bit of rebalancing needed, particularly with old friends.

I want to play golf. I want to travel a bit more, have a lot more quality time with the family. I like to read books, but as CEO, in a good year, I would read perhaps two books, because the rest of the time I was reading documents, emails, appraisals or whatever. I am sure that, at some point in time, I shall get restless again, but I’ve decided I shall wait for that moment rather than pre-empt it.

In a sentence, what would you like your legacy to be at Shell?

The strategic clarity of Powering Progress is the most important thing. Today we are a company that is financially better, is organisationally better and is operationally stronger than when I became CEO. I believe the legacy is that we are a better company in all important aspects, and we know what we want to be. Perhaps that’s the one sentence. We’re a better company that knows what we want to be.

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