FEATURE: SHELL WHISTLEBLOWER No 2: Shell Geologist/insider Dr John Huong, fires a broadside at Shell
Dr. John Huong Yiu Tuong
Miri, Sarawak, East Malaysia
10 June 2004
Dear Mr Alfred Donovan.
I will appreciate very much if you can help me to post my initial article at your
This article is only the appetiser...
I will supply for publication further informed comment and revelations in the run up to Shell's AGM on 28 June. It will include examples of the toxic combination of arrogance, greed. dishonesty, and blatant disregard for all ethical norms by Shell Management, that has culminated in the current shame heaped upon the once proud Shell name.
Dr. John Huong
SUBJECT: WHY I AM GOING INTERNATIONAL?
Along the profound story lines (italics bold) by eminent Mr. Alfred Ernest Donovan representing Shell Shareholders, I have integrated my personal insights as seen from the perspective of a former Shell employee – a Shell geologist for almost 30 years - who was unfairly axed by Shell management. I was punished because I insisted on working within the ethical boundaries of Shell’s “Statement of General Business Principles” (SGBP) which is supposed to protect shareholder, national and other stakeholder interests.
"In my experience Shell directors” and Shell managers, “believe that truth is a precious commodity to be used as a last resort. It has to be squeezed out of them. They prefer to deceive, make empty pledges (Shell's code of ethics), intimidate,” ostracize, “hide information from their own shareholders”, employees, the government who gave them the license to operate and, and finally “retreating behind their army of lawyers” for shelter “whenever there is a prospect that management misdeeds will be exposed."
I was not the only member of staff at Shell who was fired for up-holding Shell’s SGBP. That document had caused untold damage and suffering to many Shell employees. I strongly suggest that Shell suspends the SGBP until such time as Shell management is prepared to honour the noble pledges proclaimed therein. In other words, until the written pledges of integrity and transparency are matched by the actions of Shell management. In this connection, it was reported by Al-Jazeera (“Shell Oil Lies - A tip of the iceberg as World Oil crisis looms?”) that “The Oman estimates were based on assessments made in May 2000 by a senior Shell executive who was subsequently fired. He was among several executives who were said to have known about the unrealistic estimates of reserves and to have done nothing about it.”
It stated in the same article, “Geologists and analysts have been saying for some time that estimates of global oil reserves may be dangerously exaggerated.”
Correspondence between Sir Mark Moody Stuart and Mr. Richard Wiseman below shows the actual mentality of Shell Management in high places. This behavior was inevitably imitated by executives in operating companies who followed and adopted the example of a ruthless and deceitful corporate culture practiced by those at the very top of the Royal Dutch Shell Group. Shell’s ethical code was and is not worth listening to unless top management becomes a role model for integrity and transparency. Under current circumstances what is the point of having an annual ritual performed for the CEO at operating companies, where it is a mandatory requirement for staff to sign off their ethical health forms (ie Conflict of Interest) irrespective of compliance with Shell’s Statement of General Business Principles”.
For examples read the Shell Shareholder.org section of the website.
“No amount of spin and hype can hide the fact that Shell’s claimed core principle of truth and honesty in all of its dealings is unadulterated propaganda. Like Enron and WorldCom executives, Shell senior management obviously feels that it is okay to hide the truth from its shareholders and the public. This has been proven time and time again in our dealings with them - as the gagging agreements drafted by Shell lawyers at the insistence of Shell senior management prove”.
Below is a letter I last wrote on 3rd June 2004 to Shell Malaysian Management, hoping that if both sides entered into a constructive dialogue on a “without prejudice” basis, the matter could be resolved amicably despite the threats I had received on 17th May 2004 from their legal Manager Mr. Thavakumar Kandiahpillai. It is significant that legitimate questions (“Confidentiality versus Shareholder’s interests”-25th May 2004) I posed to him about Shell’s ethical practices have remained unanswered.
I am still waiting for a reply to both of my letters from you Thavakumar and/or those in authority above you!
Date: 3rd June 2004
Dear Mr. Kandiahpillai and et.al. (including Jeroen Van der Veer, Malcolm Brinded, Jon Chadwick, etc.)
It is obvious that I posed some difficult questions as I have not received any response. I was not trying to be awkward.
I simply want Shell to deal with me sympathetically as a long-term employee who was very deeply hurt by the unfortunate way my employment with Shell ended. It was terribly distressing for me after so many decades.
Frankly it would be much preferable for this matter to be resolved directly with Shell if that is at all possible, rather than continuing to be embroiled in acrimony.
On my part, I am very willing to make in good faith attempt to resolve the matter amicably if Shell is willing to do likewise. As they say, it takes two to tango.
If we could find a solution from discussions held on a “without prejudice” basis, it would save further Shell management time and avoid potentially substantial lawyers’ fees. It would also bring me some peace of mind.
I therefore believe that this is a sensible proposal which could produce a mutually beneficial result.
I am making this proposal to demonstrate that I am a reasonable person seeking a reasonable solution.
Dr. John Huong Yiu Tuong
It seems that my letters including the above were not good enough for Shell management to take steps in resolving the conflicts. I have not even received the courtesy of a response to the above proposal made in good faith. As a loyal and faithful employee of nearly 30 years standing I was unreasonably axed while protecting the shareholder, national and stakeholders interests. I am now taking steps to reveal to my extended family, the international audience, the predicaments and nightmares I have to go through in trying to abide with Shell’s SGBP. At the end of the story you will understand the pervasive nature of Shell’s corporate culture which has unfortunately escalated to appalling gigantic proportions, resulting in the repeated downgrades of Shell oil and gas volumes which have made headlines around the globe.
If a company loses the trust and respect of its shareholders, employees, and customers, as Shell Management has done on a truly spectacular basis, then there's only going to be a rather empty shell left. It will obviously be a very long time before Shell could ever again use the famous advertising slogan "you can be sure of Shell".
It seems that Mr. Jeroen van der Veer and Mr. Malcolm Brinded could not command any effective solutions to Shell management in the Operating companies in resolving my case. I am just wondering how Jeroen and Malcolm can have the time to consider the well-being of an individual axed-employee when they have to think around the clock for ways and means in undoing and/or hiding their own personal and professional wrong-doing? If only they could institute discipline and fair-minded management at the workplace, then Shell’s reputation will be given a breathing place to recover from being torn to pieces by the immoral self-serving attitude of Shell top management who appear to place their fat cat remuneration/pension packages above all other considerations, moral and legal.
Mail on Sunday: Chairman Jeroen van der Veer in frame over Shell scandal – could lead to 20 years in jail
6 June 2004
SHELL chairman Jeroen van der Veer could face criminal prosecution in the US after signing accounts that massively overstated oil and gas reserves.
The revelation is another blow to Shell. Throughout the reserves fiasco, it has presented van der Veer as Mr Clean.
Van der Veer is bound to be questioned again about his role in the scandal when he meets leading shareholders this week.
Financial Mail has established that van de Veer, ex-chairman Sir Philip Watts and former finance director Judy Boynton put their names to statements required by the Sarbanes-Oxley Act. The Act came into force in 2002 after the WorldCom and Enron scandals.
Under it, chief executives and finance directors must certify the accuracy of financial statements and other disclosures. Miscertifying can lead to 20 years in jail and a $5 million (£2.7 million) fine.
Crucially, van der Veer, Watts and Boynton certified that the 2002 reports of Shell and sister company Royal Dutch did not contain 'any untrue statement'.
Shell stunned investors this year by admitting that its oil and gas reserves had been overestimated by a fifth. Watts, Boynton and exploration chief Walter van de Vijver were sacked, but van der Veer survived.
A report into the scandal by US law firm Davis Polk & Wardwell appeared to pin the blame on Watts, Boynton and van de Vijver, but left van der Veer in the clear.
At the request of the US authorities, Shell has not published the full report. But even the executive summary reveals van der Veer knew early in 2002 of Shell's precarious position over guidelines on reserves set out by the US stock market regulator, the Securities and Exchange Commission.
In March last year, van der Veer, Watts and van de Vijver signed Shell's 2002 report and accounts for the SEC - without any adjustment for five billion barrels of overbooked oil and gas reserves.
In addition, van der Veer, Watts and Boynton separately signed the Sarbanes-Oxley statement.
Van der Veer later said he was aware that reserves were low two years before Shell admitted it, but insisted he did not know the extent of the overbooking.
A Shell spokesman said: 'We can't comment on matters under investigation in the US.'
It is again very prophetic what Mr. Donovan had written to HM Queen Beatrix of the Netherlands in March 1999 and again on 21st April 2004.
More recently, I have also written numerous times to Mr. Jeroen van der Veer and Mr. Malcolm Brinded, of the Shell Group and other senior management under the umbrella of the Royal Dutch Shell Group. All of these letters were ignored. How could Shell management treat me so despicably, so shabbily, after I had worked for Shell so loyally and with such diligence for almost three decades?
Not too long ago, I provided to Shell Management insights of my extensive knowledge of what actually goes on behind the wall of secrecy and intimidation imposed on Shell employees. This was in a letter entitled - "The Truth Behind the Royal Dutch Shell Group icon”. The full story will appear in the next News posting!
SOME ADVICE FROM A SHELL INSIDER OF ALMOST 30 YEARS…
Investors - “You cannot be sure of Shell” growing your funds. Potential employees – do not trust your career and aspirations to Shell until you understand the true inside story. If Shell is unwilling to undergo radical change at every level in the organization for the better, Shell’s negative and evil ingrained cultures will ultimately destroy the little which remains of its former reputation.
Just consider the recent appalling headlines as follows.
The Independent: “Lies, cover-ups, fat cats and an oil giant in crisis”
The Guardian: “Trail of emails reveals depths of deceit at the heart of Shell”
The Scotsman: “Shell admits reserve 'lies'”
Daily Telegraph: “Memos expose Shell's years of lying”
London Evening Standard: “Shell bosses lied to the City”
Minneapolis Star Tribune: “Dutch/Shell Group exec was 'sick and tired' of lying”
When I started with Shell all those years ago I was proud to be an employee of what I considered to be nothing less than the best company in the world; an internationally respected brand and an equally highly respected management. It is a matter of the deepest regret to me that the company has sunk so low with its management acquiring global notoriety for participating in a disgraceful scandal which ranks alongside the likes of Enron and WorldCom.
It is ironic: If only Shell management had abided by its own ethical code – the SGBP, the humiliating reserves scandal, the results of which will inevitably drag on for many years with the investigations and ruinous class action law suits, could never have occurred. As God is my witness, that is the truth.
I am finding it hard to come to terms with the con-artist mentality of a management which thought it could say one thing in speeches and advertising – pledging “Profits and Principles” - honesty, openness, integrity etc and actually get away and rewarded with doing the exact opposite.
My recipe for recovery: Every single member of Shell senior management who is implicated in or tainted to the least extent by the reserves debacle should do the honorable thing and resign immediately. That includes Mr van der Veer and Mr Malcolm Brinded. Royal Dutch Petroleum and Shell Transport and Trading should be merged into one unified company – Shell with a single management structure. It needs to have an entirely new management team and that will certainly have to think about EXCLUDING Mr. Jon Chadwick – consisting of individuals who have NO possible connection with past misdeeds and who possess the integrity and dedication essential to the considerable task of restoring Shell’s reputation; all of these ingredients are needed for a genuinely fresh start.
Only then would I be prepared to invest in Shell or to recommend anyone else to so.
All human beings are born free and equal in dignity and rights. They are endowed with reason and conscience and should act towards one another in a spirit of brotherhood.
No one shall be subjected to torture or to cruel, inhuman or degrading treatment or punishment.
No one shall be subjected to arbitrary interference with his privacy, family, home or correspondence, nor to attacks upon his honour and reputation. Everyone has the right to the protection of the law against such interference or attacks.
Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers.
(1) Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.
This article is published under the universally recognised basic human rights of freedom of expression and freedom of speech.Dr. John Huong Yiu Tuong 10 June 2004