Copyright Shell Upstream International

WHY COMPANIES INVEST IN GRIEVANCE MECHANISMS AND MANAGING COMPLAINTS? Shell Myanmar Energy Pte Ltd

Yangon, 28 January 2015.

Agnes McLaverty

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SYSTEM FOR MANAGING COMMUNITY FEED-BACK

Oil and gas industry operations can have a wide range of social and environmental impacts, and can therefore raise interest, concerns and complaints with communities

Grievance procedures, also termed community feed-back procedures, provide channels for affected communities or individuals to raise questions or concerns and have them addressed by the company in a prompt, fair, and consistent manner.

Grievance procedures can complement, but not replace, state-based judicial or non-judicial forms of remedy.

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CONCERNS/ISSUES OR GRIEVANCES/COMPLAINTS?

Community concerns or issues can be in the form of:

Questions;

Concerns;

Perceptions of impact or incidents; and/or

Rumours of impacts/incidents

What are considered grievances/complaints:

Allegation of specific impact or incident, damage or dissatisfaction arising from company actions (including contractors);

Concerns or issues which are not answered/resolved by the company can also become complaints or grievances.

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BENEFITS TO THE BUSINESS

Improve relationship with neighbouring community by demonstrating willingness to take concerns seriously;

Promote early identification of concerns, enable better management of impacts and minimizing harm;

Can increase efficiency by streamlining informal complaints system;

Prevent conflicts from escalating to litigation, protests etc;

Demonstrate alignment with international standards; and

Facilitate learning culture, analysis of trends and patterns can drive performance improvement.

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POSITIONING CGM WHEN MAKING A BUSINESS CASE*

A community grievance mechanism (CGM) represents a key element of overall human rights commitment and compliance;

It is an important tool in the stakeholder engagement and improvement toolbox; and

It provides a valuable perspective on impact management.

* IPIECA

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SHELL GRIEVANCE MECHANISM

A process for receiving, investigating and responding to questions or complaints from community stakeholders. A complaint is an expression of dissatisfaction with the company. Complaints may stem from real or perceived issues. Dealing with Grievances is part of our existing commitment to stakeholder engagement. Shell welcomes questions and complaints as opportunities for dialogue and improvement.

GRIEVANCE MECHANISM IS:

Confidential

Open to anyone

Responsive and professional

Anonymous if requested

GRIEVANCE MECHANISM IS NOT:

Duplicative of existing processes

For vexatious or unrelated complaints

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WHY INVEST IN GRIEVANCE MECHANISMS?

Even when our business is managed to the highest standards, concerns about our activities are inevitable from time to time. Dealing with grievances helps to:

Reduce value erosion by addressing concerns before they escalate;

Improve relationships by demonstrating responsiveness and respect;

Facilitate learning in order to improve the management of impacts;

Provide opportunity for dialogue with community and project opponents;

Provide information that can be incorporated into and used to validate project plans.

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WHY INVEST IN GRIEVANCE MECHANISMS?

In one Shell operation, community protests were causing significant disruption to drilling. The introduction of a grievance mechanism enabled concerns to be captured proactively, sharply reducing delays.

0

100

200

300

Before Grievance MechanismImplemented

After Grievance MechanismImplemented

Protecting Value - Days lost to community protest

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CORRIB PROJECT, IRELAND – LEARNINGS

Complaints management in relation to construction traffic provided an opportunity to improve performance:

Traffic complaints history was reviewed in advance of preparing and putting in place a new Transport Management Plan (also subject to regulatory approval);

Changes were made to deal with community concerns;

Traffic complaints reduced from 63 in 2012 to 5 in 2014.

Noise from the construction project was cause of concern for local residents:

Project was acting in compliance with permitted conditions including noise limits;

A review of the complaint history showed a particular geographic area from which most of the noise complaints arose;

Noise monitoring was offered to residents in this area to give them more specific information on noise at their dwelling;

Noise complaints reduced from 34 in 2012 to 8 in 2014.

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INTEGRATING GRIEVANCE MECHANISMS INTO PROJECTS

In addition to dealing with specific grievances, information gained through the mechanism can be used to:

Bring feed-back and learnings from the community into the planning of new activities;

In advance of mobilising new contractors, brief them using feed-back and complaints history to raise awareness and improve performance;

Sharing experience and learnings with colleagues and projects in other parts of the world help to provide solutions for (new) activities in other (new) locations;

Use knowledge gained through community feed-back and complaints as input to ongoing Social Impact Assessment and associated mitigation plans.

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HOW DOES THE PROCESS WORK?

QUESTION OR COMPLAINT

COMPLAINT OWNER INVESTIGATES AND

PROPOSES RESOLUTION

RESOLVE IMMEDIATELY

YES

NO

SOLUTION ACCEPTABLE?

RESOLVE AND CLOSE OUT

CONSIDER APPEAL OR CLOSE OUT

MINOR ISSUE AND READILY RESOLVABLE?

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