Helping People Build a Better World? Barriers to More Environmentally Friendly Energy Production in China: The Case of Shell

FNI Report 3/2008. Lysaker, FNI, 2008, 86 p.

China’s rapid industrialization and economic expansion are causing massive environmental damage, with consequences beyond the country’s borders, especially due to the use of fossil fuels’ effect on climate change. Shell China can contribute to making energy production, if not clean and sustainable, then cleaner and more sustainable by making existing energy production more environmentally friendly; by diversifying and developing alternative energy sources; and by creating precedence influencing others to follow in its footsteps. The first goal of this report is to identify and analyze changes that have happened in the Shell Group since the 1990s when energy companies started their ‘greening’ processes. These changed happened due to stricter environmental legislation, increased civil society pressure and media scrutiny. Changes on the global and headquarters level in a company do not, however, necessitate similar developments in its national and local level operations. The second goal is thus to analyze to which degree the changes in the Shell Group have had relevance for Shell China and whether barriers in the Chinese context influence its prospects to operate in a more environmentally friendly way.