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Shell’s outgoing UK chairman has seen oil firm’s role shift in a changing climate
April 9th, 2011  admin
Chairman James Smith says Shell has had to respond to the global warming challenge
Now is a good time to be running an oil company. Prices are sky-high, energy demand is increasing at an unprecedented rate as the global economy recovers, and there are new markets to be explored. Royal Dutch Shell largely dodged the criticism heaped on the industry after BP’s catastrophic oil spill last year in the Gulf of Mexico, and is delivering golden results to shareholders. Profits for 2010 were reported as $18.6bn (about £11.4bn), nearly double the $9.8bn for the year before.
So it is not surprising that James Smith, Shell’s outgoing UK chairman, speaks with a tinge of regret. At the end of the month, he will retire from the company he has been part of for 28 years, seven of them in his current role. Like other oil industry executives, Smith has a sense of destiny; an industry once regarded as dull and boring, a mere mechanical process of mineral extraction, has in the past five years taken centre stage in the global economy. “Energy is the most exciting industry,” he says with enthusiasm, in a soft Scottish burr, in his soberly fitted 24th-floor office overlooking the London Eye and the Thames. “It represents the most invigorating challenge. Energy lifts people out of poverty, it enables development. It is a place where people can have excellent careers and great job satisfaction. I’ve always been excited to be part of it.”
Smith, who has just turned 60, has overseen Shell’s latest growth spurt, and its attempted transformation from a dirty industry into a cleaner, greener and more lucrative machine. Until recently, the company still had a link prominently displayed on its home page to its apology over the 1995 Brent Spar oil platform incident: Shell had intended to scuttle Brent Spar but it was eventually dismantled on land.
A physicist by training, Smith was born in Inverness. He qualified as a chartered accountant and while working at consultancy Accenture had a number of oil companies among his clients. The lure of the North Sea proved too much to resist and he joined Shell in 1983. Smith did his stint in a far-flung corner of the oil empire, as all ambitious Shell employees are required to do, spending four and a half years in Malaysia and Brunei along with spells in the Middle East and the US and as head of technology at Shell Chemicals.
Appointed chairman of Shell UK in 2004, Smith immediately recognised his tenure would be defined by his response to climate change. The European Union’s emissions trading scheme – the first time that the oil and gas industry had to pay for its carbon emissions – came into force on 1 January 2005.
While oil industry chiefs in the US dismisse