International Business Case Study: Royal Dutch Petroleum

The Shell/Ogoni Injustice 

Royal Dutch Petroleum, most commonly known as the world’s second largest oil company- Shell, has been pumping oil out of Nigeria since 1958 (Center, 2013). The Ogoni people are estimated to have been established as a people group in southeast Nigeria since at least 15 BC (Joshua, 2013). The human rights violations of Shell towards the Ogoni people is horrifically brutal, crookedly unfair, and very real. Some people and organizations around the world are aware of the situation between Shell and the Ogoni people and are taking action; for the uninformed-action will come when they are educated on the issue, and provided with ways to combat it.

Since 1988, The Global Exchange (TGE) is a company that defines itself as: “an international human rights organization dedicated to promoting social, economic and environmental justice around the world” (Global, 2013). A nonprofit organization composed of business people, investigators, and educated human rights activists, TGE comes highly credible: “… the group that helped put labor rights on the human rights agenda” – Washington Post “angry and effective” – The Economist “a respected human rights organization” – Boston Globe Ranked in the “Top 20 Most Trusted NGOs” – Wall Street Journal

Annually, the Global Exchange releases a list of the ‘Top 10 Corporate Criminals’ where it lists companies that are not meeting basic social, economical, or environmental standards while conducting business; alumni for the list include Hershey, Coca Cola, Bank of America, Ford, Chevron, Kellogg, Nestlé, Pfizer, and many more household names-all of which have had numerous cases of extreme human rights violations (Alumni, 2013). This year, Shell has been ranked as #1 on TGE’s Top Ten list for this reason: “Between 1990 and 1995, Shell, in collusion with the military government, financed the use of deadly force against the Ogoni people, who strongly protested Shell’s presence in the region due to the stark devastation the company had on the environment. The Delta Natural Resource Damage Assessment and Restoration Project deemed the Niger Delta as, ‘as one of the world’s most severely petroleum-impacted ecosystems.’ ” (Global, 2013).

This accusation is thoroughly supported by the case of Nigerian activist Ken Saro-Wiwa who was hanged by local authorities for heartily protesting and bringing national attention to Shells forceful and inhumane presence in the region; Shell has continued it’s stance of being uninvolved, but after a $15.5 million dollar settlement to Saro-Wiwa’s family, few are convinced (Mouawad, 2009).

Other accusations against Shell include: “Twenty seven million people call the Niger Delta home, and of that number, 75% make their livelihoods with the environment, through farming and fishing for market or subsistence living. Because of Shell’s operations in the region, the Ogoni have become impoverished, as their lands have been co-opted by big business. Additionally, Shell engages in gas flaring, a byproduct of oil drilling, which harms the environment and people living in close proximity to it by contaminating the air with toxic fumes that then contaminate waterways through precipitation. These harmful chemicals are carcinogens that can induce convulsions, chromosomal damage, and birth defects. The World Bank has also stated that gas flaring has contributed to more greenhouse gas emissions than all other sources in sub-Saharan Africa combined. The Federal High Court of Nigeria has even condemned the use of gas flaring as a violation of human rights, yet Shell, among other oil companies, have continued gas flaring behind a slew of excuses.” (Global, 2013).

It is hard to imagine that Shell CEO Peter Voser would allow such injustice to occur on his watch, but Shell has claimed little responsibility for the torture of the Ogoni people and legal action taken against them has been dismissed after timely investigations. The Alien Torte Statute (ATS), heavily utilized by human rights activists I’m legal cases, is a 1789 law that grants jurisdiction to federal courts to hear tort claims by aliens alleging violations of the law of nations. In the recent case of Kiobel vs. Royal Dutch Petroleum (an Ogoni people case), the ATS was not upheld because the Supreme Court Judge Pierre Leval concurred that ATS regulation could not be applied to corporations, but only to individuals who have done harm (Global, 2013/Samp, 2013).

Where can justice be found for this people group? TGE reports that organizations including Amnesty International and Greenpeace are working together and currently conducting thorough investigations and gathering information on Shell to present to the courts. Until then, steps can be taken by those who are informed to bring awareness to this troubling practice that so terribly impacts the Ogoni people:

1. Share: because of Web 2.0, it is virtually possible to let the entire world know of an issue. Make sure your social media friends and networking associates are informed by posting and sharing the information you have read. Information is power.

2. Give: donate your time or your resources to the existing campaigns that are working hard to combat this issue. Investigations and legal work take time and money and these teams are going up against massive corporate giants.

3. Research: conduct your own research on Shell and other companies that you are a patron for; collect facts, ask questions, demand justice, vocalize, and invest in companies that are honest and humanitarian.

REFERENCES
Center. (2013). Fact sheet: Shell’s Environmental Devastation in Nigeria. Center for Constitutional Rights. Retrieved from: http://ccrjustice.org/learn-more/faqs/shell%2526%2523039%3Bs-environmental-devastation-Nigeria 

Joshua. (2013). Ogoni People of Nigeria. The Joshua Project. Retrieved from: http://www.joshuaproject.net/people-profile.php?peo3=19639 

Global. (2013). Top Ten Corporate Criminals. The Global Exchange. Retrieved from: http://www.globalexchange.org/corporateHRviolators#Shell 

Alumni. (2013). Top Ten Corporate Criminals Alumni. The Global Exchange. Retrieved from: http://www.globalexchange.org/corporateHRviolators/alums 

Mouawad, J. (2009, June 8). Shell to Pay $15.5 Million to Settle Nigerian Case. The New York Times. Retrieved from: http://www.nytimes.com/2009/06/09/business/global/09shell.html?_r=0 

Samp, R. (2013, April 18). Supreme Court Observations: Kiobel v. Royal Dutch Petroleum & the Future of Alien Tort Litigation. Forbes. Retrieved from: http://www.forbes.com/sites/wlf/2013/04/18/supreme-court-observations-kiobel-v-royal-dutch-petroleum-the-future-of-alien-tort-litigation/

 

Written by Amy Pittman for Professor S. Phillips for International Business class on October 24, 2013.

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