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2023-12-26
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Responsible

energy

#PoweringProgress

Shell plc

Sustainability

Report

2022

Contents

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Sustainability at Shell

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Our core values

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01 Shell Sustainability Report 2022

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ResponsibleShellplcenergySustainabilityReport2022#PoweringProgressContentsPoweringlives46OurapproachtopoweringlivesSustainabilityatShell46Costoflivingcrisis02LetterfromtheCEO46Providingaccesstoenergy04PoweringProgress47Workingwithoursuppliers05Ourapproachtosustainability49Contributingtocommunities09Aboutthisreport52Diversity,equityandinclusion53WorkerwelfareOurcorevalues54Respectinghumanrights12Businessethicsandtransparency55Managingourimpactonpeople14OurresponsetothewarinUkraine15SafetyGeneratingshareholdervalue59OurbusinessactivitiesAchievingnet-zeroemissions60Producingoilandnaturalgas22Energytransition61Embeddingsustainabilityintoouractivities25Managinggreenhousegasemissions62Non-operatedventures32Providinglower-carbonelectricity62Acquisitionsanddivestments34Fuellingmobility36DrivinginnovationOurperformancedata64AboutourdataRespectingnature65Ourstandardsandpolicies38Ourapproachtorespectingnature66OurPoweringProgresstargets38Environmentalcollaborations68Safetydata39Protectingbiodiversity71Greenhousegasandenergydata40Circulareconomyandwaste78Otherenvironmentaldata42Conservingwaterresources82Socialdata44AirqualityReadtheShellSustainabilityReportonlineDigitalDesignandproduction:atwww.shell.com/sustainabilityreportTheSustainabilityReportispublishedinanFriendwww.friendstudio.comordownloadourapp:onlineversionatwww.shell.com/sustainabilityreport.TheonlineversionImplementation:nexxarwww.nexxar.comincludesadditionalinformation,suchasaninteractiveGRIindextoenhanceusabilityforthereader.Intheeventofanydiscrepancybetweentheonlineandhardcopyversions,theinformationcontainedintheonlinereportprevails.Thishardcopyversionisprovidedforthereader’sconvenienceonly.SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesSustainabilityatShellWelcometotheShellSustainabilityReport,whichcoversoursocial,safetyandenvironmentalperformancein2022.Italsosetsoutourstrategytotransitionourbusinesstonet-zeroemissions.02LetterfromtheCEO04PoweringProgress05Ourapproachtosustainability09Aboutthisreport01ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesLetterfromtheCEOWaelSawanChiefExecutiveOfficerRussia’sinvasionofUkrainehascausedhugesuffering.Ithasalsotriggeredinstabilityinglobalenergymarketsandothersectors.Energyandfoodpriceshaverisen,causinginflationtospiralinmanycountries.OurfirstresponsetotheinvasionwastosafeguardourstaffinUkraineandsupportourpeopleinRussia.WealsoannouncedourintentiontowithdrawfromourRussianoilandgasactivitiesinaphasedmanner,alignedwithgovernmentguidance.WeworkedwithorganisationsinUkraineandneighbouringcountriestoprovidehumanitarianaid.Bytheendof2022,wehaddonated$74milliontohelpthepeopleofUkraine.Asthewarcauseddisruptiontoenergysupplies,weworkedtoensurethatpeoplereceivedtheenergytheyneedtokeepeconomiesrunningandelectricityflowing.Thisincludeddeliveringarecord194cargoesofliquefiednaturalgas(LNG)toEuropein2022–almostfivetimesourusualaverage.IamproudofthewayShellstaffintheUKandNorway,amongmanyothers,alsosteppeduptoproducetheoilandgasEuropeneeds.Weprovidedhelpforthosestrugglingwiththerisingcostofliving.IntheUK,forexample,weannounceda£50millionpackagetosupportvulnerableenergyconsumers,anddonatedmillionsofpoundstocharitiestohelphouseholdspaytheirenergybills.AndintheNetherlands,wearecontributingtoagovernment-backedemergencyfundforthesamepurpose.TherecentdevastatingearthquakesinTurkeyandSyriaaffectedmanyShellpeopleandtheirfamilies,althoughmercifullynostaffwereinjured.Shellhassupportedreliefeffortswiththeprovisionoffuel,andchemicalstomakefoammattressesandhandsanitiser.Wehavealsomadeaiddonationsworthseveralmilliondollars,includingmatchingdonationsmadebyourstaffaroundtheworld.BalancedtransitionTheenergyandcostoflivingcriseshavehighlightedtheneedforabalancedenergytransition:oneinwhichtheworldachievesnet-zeroemissions,whilestillprovidingasecureandaffordablesupplyofenergy.WeexpectthatLNGwillplayanimportantroleinsuchatransition.Itprovidesacriticalsupplyofenergytoday,anditproducesfewergreenhousegasemissionsthancoalwhenusedtogenerateelectricity.In2022,wemadesignificantinvestmentstoincreaseproductionofLNGandreduceemissionsfromtheprocess.WejoinedtwomajorprojectsinQatar,forexample.Bothwillusecarboncaptureandstorage,helpingustooffercustomersLNGwithalowercarbonfootprint.WealsotookafinalinvestmentdecisiontodeveloptheRosmari-MarjoramgasprojectinMalaysia,whichwillbemainlypoweredbyrenewableenergy.Net-zeroemissionsAsweinvestintheenergyneededtoday,ourtargettobecomeanet-zeroemissionsenergybusinessby2050remainsattheheartofourstrategy.Wearemakinggoodprogress.Bytheendof2022,wehadreducedcarbonemissionsfromouroperationsby30%comparedwith2016onanetbasis,morethanhalfwaytowardsourtargetofa50%reductionby2030.Wehavealsomadeprogressinsupportingourcustomersinreducingtheirownemissions,withfurtherinvestmentsinwind,solar,biofuels,hydrogen,electricvehiclecharging,carboncaptureandstorageandnature-basedsolutions.Forexample,wewonbidswithourpartnerstobuildfouroffshorewindfarmsinEuropeandtheUSA,whichtogetherhavethepotentialtogenerate7.3gigawattsofpower.WeacquiredIndiansolardeveloperSprngEnergy.Andin2023,wecompletedtheacquisitionofNatureEnergyofDenmark,whichisEurope’sbiggestproducerofrenewablenaturalgasmadefromagricultural,industrialandhouseholdwaste.InNigeria,weacquiredsolarproviderDaystarPower,whichprovidesreliablepowertocommercialandindustrialcustomers.Intotal,around41%ofourannualspendingonresearchanddevelopmentgoesonprojectsthatcontributetodecarbonisation.02ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesRespectingnaturePoweringProgressisalsoaboutrespectingnature–thelossofournaturalenvironmentandclimatechangeareinterconnectedandneedtobetackledtogether.ThiswasreinforcedbybothUnitedNationsconferencesonclimatechange(COP27)andbiodiversity(COP15)in2022.Biodiversity,water,circulareconomyandwaste,andairquality:thesearethefourareaswefocusoninourcommitmentstorespectnature.Forinstance,weareworkingtohelpendplasticwasteintheenvironment.Bytheendof2022,morethan30%ofShell-ownedservicestationshadeliminatedunnecessarysingle-useplasticandalmost40%hadcompletelyremovedsingle-useplasticbags.In2022,weannouncedplanstoincreaseourglobalproductionofpyrolysisoil,madefromhard-to-recycleplasticsotherwisedestinedforlandfillorincineration,bybuildinganewpyrolysisoilupgraderintheNetherlands.Pyrolysisoilcanreplacetraditionalfeedstockinourchemicalplants.PoweringlivesShellprovidesvitalenergyforhomes,businessesandtransport.Everyyearwegeneratejobs,revenuesandtaxesinthecountrieswhereweoperate.In2022,weemployedaround93,000peopleinmorethan70countriesandspentabout$41.5billionongoodsandservices,83%ofwhichwepurchasedlocallyinthecountryofoperation.Globally,wepaidmorethan$13billiontogovernmentsintaxes.Ourenterprisedevelopmentprogrammespromoteentrepreneurship,innovationandmeaningfulemploymentinourhostcountries.In2022,ShellLiveWIREtrainedaround2,685peopleandhelpedcreatemorethan2,170jobsin20countries,whileShellStartUpEnginesupported50start-upsinareassuchasrenewableenergyandelectricmobility.Whileweknowthereisstillmuchmoretodo,weareworkingtobecomeoneofthemostdiverseandinclusiveorganisationsintheworld.Forexample,almostone-thirdofourseniorleadershipandjustunderhalfofourgraduatehiresarewomen.Werespecthumanrightsinourbusinessandworkhardtoensurethatourjoint-venturepartnersandsupplychainsfollowthesameprinciples.WealsocontinuetosupporttheUNGlobalCompact’scorporategovernanceprinciplesonhumanrights,environmentalprotection,anti-corruptionandbetterlabourpractices.SafetyandourcorevaluesAlthoughwecontinuetomakeprogressinsafetyacrossouroperationsandwithinourindustry,wehavenotbeenabletoeliminatefatalaccidentsinvolvingShellemployeesandcontractors.Iamsaddenedtoreportthattwoofourcontractorcolleaguesdiedin2022,oneinNigeriaandoneinPakistan.Finally,onapersonalnote,Iamproudtobesharingwithyouthis,myfirstShellSustainabilityReportasCEO.Thisreportshowswhatwehaveachievedsofarinourworktobeasustainablebusiness.Weaimtodothisworkresponsibly,withdisciplineandatpacetomakeapositivedifference.WaelSawanChiefExecutiveOfficerMoreinthisreportSustainabilityatShellOurjourneytoachievingnetzeroOurapproachtorespectingnatureProvidingaccesstoenergyMoreonShellwebsitesOurstrategy:PoweringProgress03ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesPoweringProgressOurpurposeTopowerprogresstogetherbyprovidingmoreandcleanerenergysolutions.MoreinthisreportLetterfromtheCEOSustainabilityatShellSustainabilitygovernancePerformanceoverviewMoreonShellwebsitesOurstrategy:PoweringProgress04ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesOurapproachtosustainabilitySustainabilityatShellPoweringProgressisourstrategytobecomeanet-zeroemissionsenergybusinessby2050,purposefullyandprofitably,whilemaintainingasecuresupplyofenergy.Itcomprises:generatingshareholdervalue,achievingnet-zeroemissions,poweringlives,andrespectingnature.Itisastrategythatintegratessustainabilitywithourpursuitofvaluethroughhighperformance.Ourpurposeistopowerprogresstogetherbyprovidingmoreandcleanerenergysolutions.WealsoexpectouremployeesandcontractorstomaintainShell’sfocusonsafetyandabidebyourcorevaluesofhonesty,integrityandrespectforpeople.PoweringProgressisastrategythatcombinesourfinancialstrengthanddisciplinewithadynamicapproachtoourportfolioofassetsandproducts,sowecanseizetheopportunitiesoftheenergytransition.Shelltransformsitsportfoliocontinuouslytobettermeetthecleanenergyneedsofitscustomerstodayandinthefuture.ReadmoreaboutwhatsustainabilitymeansatShellatwww.shell.com/sustainability/our-approach/sustainability-at-shellandmoreaboutourstrategyatwww.shell.com/powering-progress.UNSustainableDevelopmentGoalsWestrivetoplayourpartinhelpinggovernmentsandsocietiesachievetheUN’s17SustainableDevelopmentGoals(SDGs).ThegoalswereoneoftheconsiderationsinthedevelopmentofourPoweringProgressstrategy.WebelievetheactionswetakeaspartofourPoweringProgressstrategycanhelpdirectlycontributeto13oftheSDGs,whileindirectlycontributingtoothers.InformationonhowwearecontributingtotheseSDGscanbefoundthroughoutthisreportandatwww.shell.com/sdgs.MoreinthisreportOurjourneytoachievingnetzeroOurPoweringProgresstargetsSustainabilitygovernancePerformanceoverviewMoreonShellwebsitesOurstrategy:PoweringProgressWhatsustainabilitymeansatShellCommitments,policiesandstandardsUNSustainableDevelopmentGoalsSustainabilitygovernanceWehavecomprehensivegovernancestructuresthroughoutShell,alongwithperformancestandardsandothercontrols.TheseincludetheShellGeneralBusinessPrinciples,ourCodeofConductandourHealth,Safety,Security,EnvironmentandSocialPerformance(HSSE&SP)ControlFramework.TheyinfluencethedecisionsmadeandactionstakenacrossShell.TheSafety,EnvironmentandSustainabilityCommittee(SESCo)isoneoffourstandingcommitteesoftheBoardofDirectorsofShellplc.TheoverallroleofSESCoistoassisttheBoardinreviewingthepolicies,practices,targetsandperformanceofShell,primarilywithrespecttosafety,environmentincludingclimatechange,andbroadersustainability.In2022,SESCoheldfivemeetings.ThetopicsdiscussedindepthbytheCommitteeincludedpersonalandprocesssafety,environmentalissues,Shell’senergytransitiontargets,remunerationmetricsandthechallengesfacedbyShellcompaniesinNigeria.TheCommitteealsoreviewedwidermattersofpublicconcernsuchasplasticwaste,methaneemissions,theflaringofnaturalgas,waterscarcity,justtransition,humanrights,diversityandinclusion,andaccesstoenergyinlow-andmiddle-incomecountries.TheCommitteeengagedwithexternalstakeholdersonthetopicofnature-basedsolutionsandgainedvaluableinsightsonhowShell’sapproachisperceived.SESCocontinuedtomonitorShell’sapproachtothehealthofitsemployeesandcontractors,intermsofmentalwell-beinginparticular.TheCommitteealsocontinuedtoreviewthesecurityrisksfacedbyShellandhowtheserisksarebeingproactivelymanaged.ReadmoreaboutSESCoandhowShellmanagessustainabilityatwww.shell.com/sustainability/our-approach/governanceandinour2022AnnualReport.MoreinthisreportOurjourneytoachievingnetzeroOurapproachtosafetyEnergytransitionOurapproachtorespectingnatureMoreonShellwebsitesOurstrategy:PoweringProgressBoardofDirectorsSustainabilitygovernance05ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesPerformanceoverview76gCO2e/MJ30%2021:18%Performancein20222021:77gCO2e/MJreductioninourtotalnetcarbonintensity,combinedScope1and21.7whichmeasuresthelife-absolutegreenhousegas2021:6.9cycleemissionsintensityemissionscomparedwithseriousinjuriesandoftheportfolioofenergy2016,thebaseyear.[A]fatalitiesper100millionproductssold.SeeSeeDeliveringourclimateworkinghours.SeeOurDeliveringourclimatetargetsapproachtosafetytargets139,000669.5billion2021:87,000publicandprivateelectric2021:1032021:9.1billionvehiclechargepointsoperationalprocesslitresofbiofuelswentintooperatedbyShell.SeesafetyTier1and2events.Shell’spetrolanddieselElectricvehiclechargingSeeProcesssafetyworldwide.[B]SeeBiofuels33%decrease2021:18%increase1,79032%increaseinflaring.Overallflaringdecreasedto3million2021:1,4792021:40%decreasetonnesofcarbondioxidereportstotheShellinthenumberofequivalentcomparedwithGlobalHelpline,whereoperationalspillsofmore4.5milliontonnesinpeoplecanreportthan100kilograms.There2021.SeeFlaringpotentialbreachesofthewere54in2022CodeofConduct.Seecomparedwith41in$182millionEthicalleadership2021.SeeSpills2021:$94millionspentonvoluntarysocial$41.5billion30.4%investment.SeeSocialinvestment2021:$37.5billion2021:29.5%spentongoodsandwomeninsenior78,300servicesfromaroundleadershippositions.See2021:60,00024,000suppliersDiversity,equityandstudentsparticipatedinglobally.SeeSupplyinclusionNXplorers,ourflagshipchainSTEMprogramme.SeeSTEMeducation$5billion266,0002021:$4.2billion2021:271,000spentincountrieswhereformaltrainingdaysforgrossnationalincomeisemployeesandjoint-lessthan$15,000ayearventurepartners.Seeperperson.[C]SeeLocalDiversity,equityandcontentinclusion[A]Fromassetsandactivitiesunderouroperationalcontrol.[B]Includingaround3billionlitresthroughourjointventureRaízen.[C]AccordingtotheUNDevelopmentProgramme'sHumanDevelopmentIndex2021.MoreinthisreportOurjourneytoachievingnetzeroLetterfromtheCEOOurPoweringProgresstargetsMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissions06ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesRemunerationPOWERINGPROGRESSIn2022,welinkedthepayofmorethan16,500stafftoourtargettoreducethecarbonintensityofourenergyproductsby9-12%by2024,comparedwith2016.PerformanceindicatorsrelatedtoShell’sjourneyintheenergytransitionwerepartofthe2022annualbonusscorecard(15%weighting),whichappliestoalmostallofShell’semployees.Energytransitionperformanceindicatorswerealsopartofthe2022PerformanceSharePlanawards(10%weighting)foraround16,500employeesandthe2022Long-termIncentivePlanawards(20%weighting)forseniorexecutives.From2022,thescopeofthe"Shell’sjourneyintheenergytransition"measureintheannualbonusscorecardhasbeenbroadenedtoequallymeasure:sellinglower-carbonproducts:theproportionofadjustedearningsinourMarketingsegmentcomingfromlower-carbonenergyproducts,aswellasnon-energyproductsandconvenienceretail;reducingouroperationalemissions:greenhousegasabatementprojectsthatreduceourScope1and2operationalemissions;andpartneringtodecarbonise:progressinrollingoutelectricvehiclechargepoints.Wealsointroducedacustomerexcellencemeasureontheannualbonusscorecardtoemphasisetheimportanceofbuildingstrongercustomerrelationshipsintheenergytransition.Theannualbonusscorecardalsoincludesa15%weightingbasedonsafetyperformance.OurLong-termIncentivePlan(LTIP)andPerformanceSharePlantiepayforaround16,500employeesdirectlytoachievingourstrategicambitionsfortheenergytransition.Thiselement,vestedat180%oftargetbasedonperformancetotheendof2022,reflectsourprogressintransitioningtowardsalower-carbonfuture.Theweightofthismetricwillbeincreasedfrom20%to25%forthemostsenioremployeesfortheupcomingLTIPcycle(2023-25).Readmoreaboutremunerationinour2022AnnualReport.07ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesAnnualbonusscorecardarchitecture2023Long-termIncentivePlanperformanceconditions2023PercentagePercentage15%d35%25%25%15%adaccbb25%25%35%aCashflowfromoperationsaRelativecashgeneration(cashflow(weighted35%)fromoperations/averagecapitalemployed)(weighted25%)bOperationalexcellence(Assetmanagementexcellence15%,bRelativetotalshareholderreturns(25%)projectdeliveryexcellence10%,cAbsoluteorganicfreecashflow(25%)customerexcellence10%)dAbsoluteenergytransition(25%)cShell’sjourneyintheenergytransitionPerformanceagainsttherelativemetricsis(Sellinglower-carbonproducts5%,assessedagainstotherenergymajors(BP,reducingoperationalemissions5%,Chevron,ExxonMobilandTotalEnergies).partneringtodecarbonise5%)dSafety(Seriousinjuriesandfatalitiesfrequency7.5%,Tier1and2processsafety7.5%)MoreinthisreportOurjourneytoachievingnetzeroEnergytransitionDeliveringourclimatetargetsMoreonShellwebsitesOurstrategy:PoweringProgressLeadershipCorporategovernance08ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesAboutthisreportSelectingthetopicsThe2022SustainabilityReport,publishedonMarch28,2023,isour26thsuchreport.Itdetailsoursocial,safetyandenvironmentalperformancein2022.Eachyearweuseastructuredprocesstoselectthereport’scontent.Weengagewithvariousgroupsandindividualstounderstandspecificconcernsaboutourbusinessanditsimpact,particularlyrelatingtotheenvironmentandsociety.Weconsidertheviewsofotherssuchasnon-governmentalorganisations,customers,themedia,academics,investorsandemployees.InputfromourReportReviewPanelofindependentexpertshelpstoensurethatcoverageisbalanced,relevantandcomplete.Readmoreaboutourtopicselectionprocessatwww.shell.com/sustainability/transparency-and-sustainability-reporting/sustainability-reports.ReportingguidelinesOurreportingisinformedbytheguidelinesdevelopedbyIpieca,theglobaloilandgasindustryassociationforadvancingenvironmentalandsocialperformanceacrosstheenergytransition,andinaccordancewiththeGlobalReportingInitiative(GRI)Standards(seetheGRIcontentindexforfulldetails).AsamemberoftheWorldBusinessCouncilforSustainableDevelopment,wesupporttheorganisation’supdatedcriteriaformembershipfrom2022,whichincludesrequirementsforcorporatetransparency.TherecommendationsoftheTaskForceonClimate-relatedFinancialDisclosures(TCFD)guideourreportinginourAnnualReport.Ourclimate-relatedfinancialdisclosuresareconsistentwithalloftheTCFDrecommendationsandrecommendeddisclosures.Werecognisethevaluethattherecommendationsbring.Moredetailedinformationabouthowwereportisavailableatwww.shell.com/sustainability/transparency-and-sustainability-reporting.html.MoreinthisreportSustainabilityatShellAboutourdataOurstandardsandpoliciesGRIcontentindexMoreonShellwebsitesOurstrategy:PoweringProgressVoluntaryreportingstandardsandESGratingsReportReviewPanelWeuseanexternalreviewpaneltostrengthenoursustainabilityreporting.ThepanelhelpsevaluateandimprovethequalityandcredibilityofourSustainabilityReport.The2022ReportReviewPanelcomprisedfivesustainabilityandcorporatereportingexperts:HilaryParsons,UK,formerlyHeadofCreatingSharedValueEngagement,Nestlé(ChairoftheReportReviewPanel);VanessaZimmerman,Australia,ChiefExecutiveOfficer,PillarTwo;RenardSiew,Malaysia,AdviseronClimateChange,CentreforGovernanceandPoliticalStudies;ElizabethWhite,USA,PrincipalStrategistandGlobalHeadSustainabilityandDevelopmentImpact,SectorEconomicsandImpactMeasurement,IFCWorldBankGroup;andMariaPontes,UK,DirectorofProgrammesandPartnerships,EarthwatchEurope.Thepanelprovidedinputintoour2022topicselectionprocess.Panelmembersreviewedthereport,discussedShell’sreportingandspoketorelevantShellemployeesbeforepreparingtheirstatement.Thepanel’smandatefocusedonthequalityofShell’sreporting,includingcredibility,completenessandresponsiveness.ThepanelisnotaccountableforreviewingthedatainthereportormaterialonShell.comoutsidetheboundsofthisreport.Panelmembersareofferedanhonorariumfortheirinput.Findoutmoreaboutthepanelatwww.shell.com/sustainability-report-review-panel.09ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceshareholdervaluedataShellOurcorevaluesemissionsRespectingnaturePoweringlivesReportReviewPanelrecommendations"Shellhasprovidedthepanelwiththeopportunitytoreviewtwodraftsofthe2022SustainabilityReportandtoprovidewrittenandverbalfeedback.ThisfeedbackhasbeenconsideredbyShellinproducingthefinalversionofthereport.In2021,Shellsignificantlychangeditsapproachtosustainabilityreportinginordertofocusmoreonthedataandlessonqualitativeandcontextualinformation,whichisnowreferencedonitswebsite.ThishasresultedinafarmoreconciseandlogicalreportwithlinkstofurtherinformationlocatedonShell.com.Thepanelhasnotreviewedthisadditionalinformationasitisnotwithinourremit.Thepanelwelcomesthismoreconciseapproachwhichrecognisestheneedtoprovidesuccinct,digestibleinformationtostakeholderswhilegivingthemabriefexplanationofcontextandlinkstofurtherdetails.Followingthepanel’sfeedbacklastyearthatthe2021reportcouldhaveincludedmorecontext,thepanelnotedanimprovementinthebalancebetweendataandcontextoverthepreviousyear.WeencourageShelltocontinuetofindwaysofachievingthis,asqualitativeinformationhelpsshinelightonthesignificanceofthefigures.WenotethatShellalsopresentssomedataingraphicforminordertoillustrateprogressonstrategicprioritiesovertime.ThepanelwelcomedtheinclusionofsectionsontopicalissuessuchasthewarinUkraineandthecostofliving.ItalsonotedthatthesectiononRespectingnaturewasmoreinformativeandspecific–atrendthepanelhopeswillcontinue.Thepanelfeltthatmorecouldbedonetosuccinctlysummariseprogressontargetsovertheyearaswellasanychangestosignificantissues.Thiswouldassistinidentifyingwhatprogresshadbeenmadesincethepreviousyear.Inaddition,morecross-referencingoftopics,suchashowhumanrightsrelatetosupplychain,climatechangeandbiodiversity,wouldhelpstakeholdersbetterunderstandlinkagesandwhatShellisdoingtomanagethesetopics.InformationrelatedtotheTaskForceonClimate-relatedDisclosurescouldbeleveragedinthereport.ThepanelrecommendsthatShelllooktoprovidefurtherinformationanddataonthefollowing:energyaffordabilityandaccessibility;theenvironmental,socialandgovernancerisksinvolvedinthetransitiontorenewablesolutions(includingsolar)andinconnectionwithbiodiversity;offsets,includingabreakdownandhowthisrelatestotheoverallstrategy;stakeholderengagements,particularlythoserelatedtoachievingajusttransition;involvementwiththeScienceBasedTargetsinitiative’ssocialaspects,includinginclusiononthesocialreturnoninvestmentcreated;andhowShellhasreviewedandprioritiseditssalienthumanrightsrisks."ReportReviewPanelJanuary31,2023MoreinthisreportSustainabilityatShellAboutourdataOurstandardsandpoliciesGRIcontentindexMoreonShellwebsitesOurstrategy:PoweringProgressVoluntaryreportingstandardsandESGratings10ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesLivingbyourcorevaluesOurPoweringProgressstrategyisunderpinnedbyourcorevaluesofhonesty,integrityandrespectforpeople,andourfocusonsafety.Thisincludesourcommitmenttodoingbusinessinanethicalandtransparentway.12Businessethicsandtransparency14OurresponsetothewarinUkraine15Safety11ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesBusinessethicsandtransparencyEthicalleadershipPOWERINGPROGRESSPoweringProgressisunderpinnedbyourcorevaluesofhonesty,integrityandrespectforpeople,andourfocusonsafety.Thisincludesourcommitmenttodoingbusinessinanethicalandtransparentway.Ourcorevaluesofhonesty,integrityandrespectforpeopleunderpinourworkwithemployees,customers,investors,contractors,suppliers,non-governmentalorganisations,thecommunitieswhereweoperateandothers.TheShellGeneralBusinessPrinciplessetoutourcorevalues,ourresponsibilitiesandtheprinciplesandbehavioursthatguidehowwedobusiness.Whenenteringajointventureoperatedbyapartner,weexpectthemtoapplystandardsandprocesses,orprinciples,thataresubstantiallyequivalenttoourown.CodeofConductTheShellCodeofConductexplainshowemployees,contractorsandanyoneelseactingonbehalfofShellmustbehavetoliveuptoourbusinessprinciples.TheCodeofConductcoverssafety,anti-briberyandcorruption,faircompetition,humanrightsandotherimportantareas.Shellemployees,contractorsandthirdpartiescanreportanypotentialbreachesoftheCodeofConductconfidentiallythroughseveralchannels,includinganonymouslythroughaglobalhelpline,operatedbyanindependentprovider.ThethreemostfrequentcategoriesofallegedCodeofConductbreachesraisedviatheShellGlobalHelplinein2022relatedtoharassment,conflictofinterestandprotectionofassets.Wemaintainastringentnoretaliationpolicytoprotectanypersonmakinganallegationingoodfaith.InNovember2022,weissuedtheDotheRightThingguidelines,whichbringclarityandconsistencytohowwemanageseriousviolationsofourCodeofConduct.TheguidelineshelpstafftoknowwhentoreportbreachesoftheCodeofConductandfeelsafeandprotectedaboutdoingso.In2022therewere:1,790183reportstotheShellGlobalHelplineconfirmedbreachesoftheCodeofConduct21653peopledismissedemployeesorcontractorstaffsubjecttodisciplinaryactionAnti-briberyandcorruptionShellhasrulesonanti-briberyandcorruptioninitsCodeofConductandEthicsandComplianceManual.ContractorsandconsultantsarealsorequiredtoactconsistentlywithourCodeofConductwhenworkingonourbehalf.Shellhasaround24,000suppliersworldwide(seeSupplychain).Althoughourlargestsuppliersoftenhavetheirownanti-briberyandcorruptiontrainingprogrammes,smallercompaniesmaylacktheresources.Weofferfreetraininginanti-briberyandanti-corruptionpracticestoselectedsuppliersandcontractors.Thistrainingisavailablein14languages.In2022,weofferedtrainingto503third-partycompaniesin23countries.Readmoreatwww.shell.com/sustainability/transparency-and-sustainability-reporting/transparency-and-anti-corruption.ProtectingpersonaldataShellrespectstheprivacyofindividualsandrecognisesthatpersonaldatabelongtotheindividual.Wemaintainadataprivacyprogramme,acomprehensivegovernancestructureandestablishedreportinglinestoensureconsistentlevelsofdataprotectionacrosstheGroup.Ourstaffandcontractorsreceiveclearguidanceandtrainingontheimportanceofmanagingdataprivacyrisks.12ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesWheneverweacquireacompany,weworktoensuretheyfollowourprivacycomplianceframeworkandinformationmanagementstandards.SomeofouracquiredcompaniesinnewbusinesssectorsarenotyetinfullcompliancewiththeShellControlFramework.Weassesseachcompanyandputinplaceprojectsforthemtoachievecompliance,andprovideregularupdatesontheirprogress.In2021,Shell’slargefiletransfersystem,suppliedbyathirdparty,washackedbycybercriminals.TheincidentresultedinShellTurkeypayinganadministrativepenaltyin2022ofaround€13,000totheTurkishdataprotectionauthority.ReadmoreaboutShelldataprivacyrulesinourAnnualReportandatwww.shell.com/privacy.CybersecurityShellissubjectedtofrequentcyberattacks.Wecontinuallymeasureandimproveourcyber-securitycapabilitiestoreducethelikelihoodofsuccessfulbreaches.OuremployeesandcontractstaffreceiveregularmandatorytrainingtoprotectourITsystemsfromthreats.Readmoreaboutinformationtechnologyandcybersecurityinour2022AnnualReport.MoreinthisreportLetterfromtheCEOWorkingwithoursuppliersCollaborationsandstakeholderengagementTaxtransparencyMoreonShellwebsitesOurstrategy:PoweringProgressCodeofEthicsOurvaluesCollaborationsandstakeholderengagementShellcontinuestovalueandrecognisetheimportanceofengagementandco-operationwithitsstakeholders.Weworkwithgovernments,non-governmentalorganisations(NGOs),coalitions,industrybodies,academicinstitutions,nationaloilandgascompaniesandotherbusinesses.Wedothisincompliancewithantitrustrulesandregulations.Thesecollaborationsincludeindividualconversations,workingtogetheronaprojectorareasofadvocacy,orsponsoringaparticulargrouporevent.Theseeffortshelpustolearn,sharebestpractice,achievespecificobjectives,setfuturegoalsandbuildtrustwithourstakeholders.TheChair,certainBoardcommitteesandNon-executiveDirectorstraditionallyvisitanumberofShelloperationsandoverseasoffices.ThevisitsaredesignedtoprovideDirectorswithfirst-handinsightsintoportfoliopositionsandopportunitiestoengagedirectlywithstakeholdersincludingemployees,partners,communitiesandNGOs.Ourbroaderbusinessesregularlyengagewithstakeholdersthroughouttheyearandinthebuild-uptoorduringmanyShellprojectsoractivities.Readmoreaboutoureffortstounderstandandengagewithourstakeholdersinour2022AnnualReport.Readmoreaboutcollaborationsandstakeholderengagementatwww.shell.com/sustainability/our-approach/working-in-partnership.MoreinthisreportManagingourimpactonpeopleLetterfromtheCEOProtectingbiodiversitySocialinvestmentMoreonShellwebsitesOurstrategy:PoweringProgressExternalvoluntarycodesHumanrightsPoliticalengagementShellengageswithgovernments,regulatorsandpolicymakerstohelpshapecomprehensivepolicy,legislationandregulation.Weadvocateourpositionsonmatterswhichaffectus,ouremployees,customers,shareholdersorlocalcommunities,inaccordancewithourvaluesandtheShellGeneralBusinessPrinciples.IntheEuropeanUnion(EU)andtheUSA,wereportexpenditureassociatedwithourlobbyingactivities,whichincludesestimatedpercentagesofindustryassociationcosts,inlinewiththerequirementsandguidelinessetoutintheEUTransparencyRegisterandtheUSLobbyingDisclosureActrespectively.Therearedifferentrulesforwhichcostsshouldbereportedinthesetwosubmissionsandwearerequiredtocomplywiththeappropriaterequirementsforeachjurisdiction.Thesesubmissionsarepubliclyavailable:IntheEU,Shell’sreportedestimatedannualcostsrelatedtoactivitiescoveredbytheregisterwere€5,500,000to€5,999,999in2022.IntheUSA,Shell’sreportedexpensesrelatedtolobbyingpracticeswere$6,660,000in2022.In2022,wecontinuedtoadvocateourpolicypositionsonclimateandtheenergytransitionandprovidedupdatesaboutouradvocacyonourwebsite.Forexample,wesupportedarangeofpolicymeasureswithintheEU’sFitfor55package,andsupportedtheUSInflationReductionActthatcontainsvariouscleanenergyprovisions.Aswellasmanyotherevents,weattendedtheUNClimateChangeConference(COP27)andUNBiodiversityConference(COP15)asobservers,tolistenandlearn.OurClimateandEnergyTransitionLobbyingReportprovidesanoverviewofourlobbyingin2022andthatofsomeofourkeyindustryassociations.Readthereportandfurtherinformationaboutouradvocacyandpoliticalengagementapproachatwww.shell.com/advocacy.MoreinthisreportLetterfromtheCEOTaxtransparencyMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsAdvocacyandpoliticalactivityPaymentstogovernments13ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesTaxtransparencyOurtaxstrategyisdesignedtosupportPoweringProgressthroughourcommitmenttotransparency,complianceandopendialoguewithourstakeholders,fromgovernmentstocivilsociety.Ourstrategyandactionsreflectourvaluesandprinciples.Taxrevenuesenablegovernmentstopayforpublicservices,suchaseducation,healthcareandtransport.In2022,Shellpaid$68.2billiontogovernments:wepaid$13.4billionincorporateincometaxesand$8.2billioningovernmentroyalties,andcollected$46.6billioninexciseduties,salestaxesandsimilarleviesonourfuelandotherproductsonbehalfofgovernments.Wealsomadeotherpaymentstogovernments,including$15.1billioninproductionentitlements,$2.6billioninfeesand$221millioninbonuses.Newtaxes,suchastheEUsolidaritycontributionandtheUKEnergy(OilandGas)ProfitsLevy,wereintroducedin2022.ShellpublishesaTaxContributionReportannuallywhichsetsoutthecorporateincometaxthatShellcompaniespaidincountriesandlocationswheretheyhaveataxablepresence.OurlatestTaxContributionReportincludesabreakdownofourtotaltaxcontributionin21countrieswherewehavekeybusinessactivities,anincreasefromfiveinthepreviousyear.Wehopetoexpandthisdisclosuretoincludeourothertaxjurisdictionsinthefuture.Weregularlyengagewithpolicymakerstosupportthedevelopmentoftaxrulesandregulationsbasedonsoundtaxpolicyprinciples.Inthisway,wehopetocontributetothedevelopmentoffair,effectiveandstabletaxsystems.Wealsoprovideconstructiveinputtoindustrygroupsandinternationalorganisations,suchastheExtractiveIndustriesTransparencyInitiative,theBTeamResponsibleTaxWorkingGroupandtheinternationalbusinessnetworkBusinessatOECD.Forinstance,Shellhasworkedwiththelargestemployers’organisationintheNetherlands,VNO-NCW,onaninitiativetoimprovetaxgovernanceandtransparencyforcompanieswhosesecuritiesarelistedinthatcountry.InMay2022,VNO-NCWpublishedtheTaxGovernanceCode(TGC),whichShellhelpedinitiateanddevelop.GiventhescaleofouractivitiesintheNetherlands,wehavevoluntarilysigneduptotheTGC.Readmoreaboutourapproachtotaxatwww.shell.com/sustainability/transparency-and-sustainability-reporting/shells-approach-to-tax.html.ReadourlatestTaxContributionReportatwww.shell.com/tax-contribution-reportandourPaymentstoGovernmentsreportatwww.shell.com/payments.MoreinthisreportPoliticalengagementMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsTaxContributionReport2021Shell’sapproachtotaxPaymentstogovernmentsOurresponsetothewarinUkraineOnMarch8,2022,ShellannounceditsintentiontowithdrawfromitsinvolvementinallRussianhydrocarbonsincludingcrudeoil,petroleumproducts,gasandliquefiednaturalgas,inaphasedmanner,alignedwithgovernmentguidance,andincompliancewithsanctions,applicablelawsandregulationsofthecountriesinwhichitoperates(seewww.shell.com/media-statements).InMay2022,ShellsoldShellNeftLLCtoPJSCLUKOILand,indoingso,hasexitedallitsdownstreambusiness(includingservicesstations,fuelssupplyandlubricants)inRussia.AlsoinMay2022,Shell’sshareintheGydanenergyexplorationventurewastransferredtoourjoint-venturepartner,GazpromNeft.Gydanisintheexplorationphasewithnoproduction.InSeptember2021,ShellsignedabindingnovationagreementtotakeoveraGasTerragassupplycontractwithGazpromExportLLC(Gazprom),withthetransfertotakeeffectfromOctober1,2022.Upontransfer,apayabletoGazpromwasrecordedwithacorrespondingreceivablefromGasTerra.ThegassupplycontractterminatedinDecember2022.OnMarch3,2023,ShellannouncedthatithadcompletedthesaleofitsinterestinSalymPetroleumDevelopmentLimitedLiabilityCompanytoasubsidiaryofGazpromNeftforwhichanagreementwassignedonDecember22,2022.Shellholdsa27.5%interest(minusoneshare)inSakhalinEnergyInvestmentCompanyLtd(SEIC).OnJune30,2022,aRussianPresidentialDecreewaspassedrequiringthetransferofalllicences,rightsandobligationsofSEICintoanewlycreatedRussiancompany(LLC)thatwouldassumetherightsandobligationsofSEIC.ThedecreestatedthattheforeignshareholderswouldbeinvitedtoapplyforsharesinthatentityequivalenttotheirshareholdinginSEIC.ShellformallyadvisedtheRussianFederationthatitwouldnotapplyforsharesintheLLC,thatitobjectedtothepurportedtransfersfromSEICtotheLLCandthatitreservedallrightsandremedies.ReadmoreaboutourwithdrawalfromRussianoilandgasactivitiesinNote6inour2022AnnualReport.14ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesHelpingourstaffandthepeopleofUkraineOuraimistoensurethesafetyofourstaffandcontractorsinUkraineandtosupportreliefefforts.WeofferedassistancetoourstaffinUkrainefleeingthewarandcontinuetopaythesalariesofthosemobilisedformilitaryservice.WeworktokeepourretailsitesopeninUkraineandvitalenergysuppliesmoving.ShellonlyoperatesinterritoriescontrolledbytheUkrainianauthorities.WehavealsoprovidedsupporttoourstaffinRussiaastheyfacedtheuncertaintyofShell’swithdrawalby,forinstance,transferringemployeesofShellNefttothenewowner.Bythestartof2023,theoverallamountofourhumanitariandonationsfortheUkrainewarhadreached$74million.OurfocushasbeentosupportthepeopleofUkrainebyworkingwithaidorganisationsinUkraineandinborderingcountries,whererefugeeshaveheadedintheirmillions.AspartofourinitialeffortsinUkraineandPolandaftertheinvasion,wepledgednearly$11milliontoseveralhumanitarianandaidorganisationsinUkraineandPoland,ofwhich$3millionwashumanitarianaidtoourglobaldisasterreliefpartner,MercyCorps,tohelpmeettheimmediateneedsofthoseaffectedbythewarinUkraine.Inaddition,ShellhasmatchedemployeedonationstoMercyCorps.InMarch2022,wepurchasedacargoofRussiancrudeoiltoberefinedintoproductslikepetrolanddiesel.Despitebeingmadewithsecurityofsuppliesattheforefrontofourthinkingandbeingincompliancewithapplicablelaws,wequicklyrecognisedthatitwasnottherightdecisionandapologised.TheprofitsfromthecrudeoilboughtonthespotmarketaftertheconflictstartedweredonatedtotheEmbassyofUkraineintheUKforitsWithUkrainehumanitarianaidprogramme($30million),whileanother$30millionwasdonatedtotheUNWorldFoodProgrammetosupportthepeopleimpactedbytheconflictinUkraine.ReadmoreaboutourresponsetothewarinUkraineatwww.shell.com/war-in-ukraine-shell-responseandinour2022AnnualReport.OurbusinessactivitiesinbothRussiaandUkraineintermsoffinancialdatabeforetheinvasionaredisclosedinourTaxContributionReport2021.SafetyOurapproachtosafetyPOWERINGPROGRESSPoweringProgressisunderpinnedbyourcorevaluesofhonesty,integrityandrespectforpeople,andourfocusonsafety.SafetyiscentraltoourPoweringProgressstrategy.Weaimtodonoharmtopeopleandtohavenoleaksacrossouroperations.WecallthisourGoalZeroambition.Weseektoimprovesafetybyfocusingonthethreeareaswherethesafetyrisksassociatedwithouractivitiesarehighest:personal,processandtransport.Westrivetoreducerisksandtominimisethepotentialimpactofanyincident,withaparticularemphasisontheriskswiththemostseriousconsequencesifsomethinggoeswrong.In2020,westartedamulti-yearprocessofrefreshingourapproachtosafetyforallemployeesandcontractors.In2022,aspartofthisapproach,wefocusedonconductingdetailedchangeimpactassessmentsacrosstheShellGrouptoassesstheextenttowhichournewsafetyprinciplesarebeingintegrated.Wecompleted49of52assessmentsofassets,projects,functionsandbusinesseswithinShell(weaimtocompletetheremainingassessmentsin2023).Inaddition,sevennon-operatedventureselectedtoembedelementsofourrefreshedapproachtosafetyintheirimprovementplans.Weworkcloselywithourcontractorstobuildastrongsafetycultureatthefrontline.In2022,wecompletedconstructionoftheShellPolymersMonacapolyethyleneproductionfacilityinPennsylvania,USA,withmorethan67millionexposurehourswithoutfatalityorseriousinjury.DuringthebuildingofafloatingproductionstorageandoffloadingvesselforourShell-operatedPenguinsfield(Shellinterest50%)intheUKNorthSea,theChinaOffshoreOilEngineeringCompany’sfabricationyardinChinaachievedmorethan16millionhourswithoutfatalityorseriousinjury.AsofJanuary1,2022,wehaveadoptedtheindustryLife-SavingRulesoftheInternationalAssociationofOil&GasProducers.Duringtheyear,mandatorye-learningonthenewruleswascompletedbyaround126,000staffandcontractors.Readmoreaboutourapproachtosafetyandhowweworkwithourcontractorsatwww.shell.com/sustainability/safety/our-approach.MoreinthisreportPreparingforemergenciesLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsSafetyHSSEmaterialsforcontractors15ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesPersonalsafetyFatalaccidentrateFatalaccidentrate(FAR)Numberper100millionhours21013141516171819202122SeriousinjuriesandfatalitiesThenumberofseriousinjuriesandfatalitiesdecreasedtoeightin2022from32in2021.Regrettably,however,twoofourcontractorcolleaguesinShell-operatedventureslosttheirlivesin2022duringthecourseoftheirworkforShell.OnecontractorcolleagueinNigeriadiedfrominjuriessustainedduringafire.InPakistan,acontractorcolleaguediedduringroadtransportactivitiesundertheoperationalcontrolofShell.TheShellorganisationfeelstheselossesdeeply.Wearedeterminedtolearnfromtheseincidentsanddoeverythingpossibletopreventanythingsimilarfromhappeningagain.Wecontinuetoworkcloselywithourcontractorstohelpbuildastrongsafetycultureatthefrontline.Seriousinjuryandfatalityfrequency(SIF-F)[A][B]Numberper100millionhours105013141516171819202122[A]Definedasaseriouswork-relatedinjuryorillness,includingthosethatresultedinfatalityoralife-alteringevent.Life-alteringeventisdefinedasalong-termorpermanentinjuryorillnesswithsignificantimpactondailyactivities.ExamplesofSIFinclude,butarenotlimitedto,permanenttotaldisability,amputationofabodypart(fullorpartial),reducedbodilymobility(fullorpartial),third-degreeburns,impairedvision,hearing,senseoftasteorsmell.[B]Databefore2019arenotavailable.ThenumberofSIFcasesfor2019and2020reflectsthebestestimate.CombinedworkforceSIFfrequencyfor2019-20wasadjustedtoaccountforsomeuncertaintyinthenumberofSIFcases.Tostrengthenoureffortstoprotectpeoplefromharm,wemeasurethenumberofseriousinjuriesandfatalitiesper100millionworkinghours.Thisallowsustofocusoureffortstopreventseriousinjuriesandfatalitiesonthemostcriticalevents.In2022,thenumberofseriousinjuriesandfatalitiesper100millionworkinghours(SIF-F)was1.7,comparedwith6.9in2021.In2022,theInternationalAssociationofOil&GasProducersadoptedtheSIFclassificationcriteriawithminimalchangestodefinetheindustry"fatalityandpermanentimpairment"injuryclassification,whichShellalsofollows.TotalrecordablecasefrequencyTotalrecordablecasefrequency(TRCF)Numberpermillionhours2101314151617181920212216ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesIn2022,thenumberofinjuriespermillionworkinghours–thetotalrecordablecasefrequency–was1.0,anincreasefrom0.9in2021.TheincreasewasrelatedtolosttimeinjuriesatanewlyacquiredcompanyintheUSA.LosttimeinjuryfrequencyLosttimeinjuryfrequency(LTIF)Numberpermillionhours0.500.250.0013141516171819202122Thelevelofinjuriesthatledtotimeoffworkin2022increasedto0.4casespermillionhourscomparedwith0.3in2021.TheincreasewasrelatedtolosttimeinjuriesatanewlyacquiredcompanyintheUSA.Readmoreaboutourapproachtopersonalsafetyatwww.shell.com/sustainability/safety/personal-safety.ReadmoreabouthowShell’s2022safetyperformanceimpactedremunerationintheDirectors’RemunerationReportinour2022AnnualReport.MoreinthisreportPreparingforemergenciesLetterfromtheCEOMoreonShellwebsitesDriversafetyCommunityroadsafetyLife-savingrulesProcesssafetyProcesssafetymanagementisaboutkeepinghazardoussubstancesinpipes,tanksandvesselssotheydonotcauseharmtopeopleortheenvironment.Itstartswithdesigningandbuildingprojectsandisimplementedthroughoutthelifecycleofthefacilitiestoensuretheyareoperatedsafely,wellmaintainedandregularlyinspected.Inlinewithindustrystandards,wemeasureandreportprocesssafetyincidentsaccordingtosignificance,withTier1asthemostsignificantcategory.Tier1+2operationalprocesssafetyevents,excludingsabotage[A]500400300b2002461941691001101178689696551354134382022150a6557514149201820192020202120132014201520162017aTier1bTier2[A]ProcesssafetyeventsareclassifiedaccordingtoguidancefromtheInternationalAssociationofOil&GasProducersandtheAmericanPetroleumInstitute.In2022,therewerethreeTier1sabotage-relatedevents.Theclassificationofsabotage-relatedprocesssafetyeventsismadeonthebest-endeavoursbasis.ThenumberofTier1and2operationalprocesssafetyeventsin2022decreasedsignificantlycomparedwith2021.Therewere66eventsreportedduringtheyearcomparedwith103in2021.Thedecreasewaspartlyduetodivestments,aswellasimprovementsinworkprocessesandusingdatatoenhancesafetyplanning.ProcesssafetyeventsrelatedtosabotageandtheftinNigeriaarerecordedseparately.InNigeria,therewerethreesabotageTier1eventsin2022,comparedwithsevensabotageeventsin2021.Readmoreaboutprocesssafetyatwww.shell.com/process-safety.MoreinthisreportOurapproachtosafetyLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsProcesssafety17ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesPreparingforemergenciesHavingthenecessaryresourcestodealwithspills,leaks,firesandexplosions,bothoffshoreandonshore,isessentialtomeetouraimtodonoharmtopeopleortheenvironment.Weroutinelyprepareandpractiseouremergencyresponsetopotentialincidentssuchasaspillorafire.Thisinvolvesworkingcloselywithlocalemergencyservicesandregulatoryagenciestojointlytestourplansandprocedures.In2022,weheldfourlarge-scaleemergencyresponseexercisestoensurewehavetherequiredpreparednessatassetsweoperateinBrazil,Nigeria,thePhilippinesandtheUSGulfofMexico.Westrivetolearnnotonlyfromeventsthathavehappened,butalsofrompotentialeventsthatwerepreventedbyoursafetybarriers.SpillsWehaveprogrammesinplaceacrossouroperationstoreducethenumberofoperationalspills.Thevolumeofoperationalspillsofoilandoilproductsofmorethan100kilogramstotheenvironment(landorwater)in2022was0.06thousandtonnes,anincreasefrom0.05thousandtonnesreportedfor2021.In2022,thelargestoperationalspillwasaspillofaround19.5tonnesintheNetherlands.Spills-operational[A]1025051250131415161718192021220Volumeinthousandtonnes(leftaxis)Numberofspills(rightaxis)[A]Allspillvolumesandnumbersareforhydrocarbonspillsofmorethan100kilogramstotheenvironment(landorwater).Wehaveupdatedsomeofourhistoricalfiguresfollowingareviewofthedata.Therewere54operationalspillsofmorethan100kilogramsin2022,comparedwith42in2021.Spills-sabotage[A][B]1025051250131415161718192021220Volumeinthousandtonnes(leftaxis)Numberofspills(rightaxis)[A]Allspillvolumesandnumbersareforhydrocarbonspillsofmorethan100kilogramsintotheenvironment(landorwater).Wehaveupdatedsomeofourhistoricalfiguresfollowingareviewofthedata.[B]Allsabotage-andtheft-relatedspillsoccurredinNigeriaexceptin2015(0.005thousandtonnes)and2016(0.001thousandtonnes).In2022,allofthespillscausedbysabotageandtheftwereinNigeria.Thenumberofthesespillsdecreasedto75in2022from106in2021,whilethevolumeofthesespillsdeclinedto0.6thousandtonnesfrom3.3thousandtonnesin2021(seeSpillresponseandpreventioninNigeria).Readaboutouremergencyresponseproceduresatwww.shell.com/process-safety.MoreinthisreportSpillresponseandpreventioninNigeriaOurapproachtosafetyLetterfromtheCEOMoreonShellwebsitesOurstrategy:PoweringProgressOurapproachProcesssafety18ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesSpillresponseandpreventioninNigeriaIntheNigerDelta,overthelast12years,thetotalnumberofoperationalhydrocarbonspillsandthevolumeofoilspilledfromthemintotheenvironmenthavebeensignificantlyreduced.MostoilspillsintheNigerDeltaregioncontinuetobecausedbycrudeoiltheft,thesabotageofoilandgasproductionfacilities,illegaloilrefining,andthedistributionofillegallyrefinedproducts.In2022,theShellPetroleumDevelopmentCompanyofNigeriaLimited(SPDC),asoperatoroftheSPDCjointventure(SPDCJV,Shellinterest30%)[A],reported10operationalspillincidentsofmorethan100kilogramsofcrudeoil,morethanthe9reportedin2021.Thevolumeofaround0.01thousandtonneswaslessthanthe0.03thousandtonnesrecordedin2021.[A]Unlessotherwisestated,allactivitiesreportedfororasrelatingtoSPDCinthissectionshouldbeunderstoodasSPDCactingastheoperatoroftheSPDCJV.SPDC,asthecorporateentity,owns30%oftheJV.In2022,about88%oftheoilspillsofmorethan100kilogramsfromtheSPDC-operatedfacilitieswerecausedbytheillegalactivitiesofthirdparties.In2022,thevolumeofcrudeoilspillsofmorethan100kilogramscausedbysabotagewasaround0.6thousandtonnes(75incidents),comparedwitharound3.3thousandtonnes(106incidents)in2021.Thedecreasednumberofincidentsin2022correlateswithashutdownofproductionforaboutsixmonthsbecauseofanunprecedentedincreaseofcrudeoiltheftfromtheTransNigerPipeline,whichisoperatedbySPDConbehalfoftheSPDCJV.SPDCcontinuestoworkwiththegovernmentsecurityagenciestomaintainsurveillanceandaddressillegalactivitiesofthirdparties,primarilyalongtheSPDCJVpipelineanditsoperationalareas.Bytheendof2022,atotalof311steelcageshadbeeninstalledtoprotectwellheads,including38thathadbeenupgradedwithCCTV.Thiscomparedwithatotalof283installedcagesattheendof2021.In2022,of732registeredattemptstobreachthem,47weresuccessful.SpillresponseandpreventioninNigeriaClean-upPreventionSpillsin2022AveragedaysbeforejointinvestigationsIllegaltheftpointsremoved:468in2022,commence:twodaysin2022,improved1,390intotalsince2016Numberofoperationalspills:10fromsixdaysin2016Volumeofoperationalspills:10tonnesSteelcagesinstalledtoprotectwellheads:Averagedaystocompletetherecoveryof311Numberofspillscausedbythird-partysurfaceoil:aroundoneweekin2022,interferenceandotherillegalactivities:75,improvedfrom13daysin2016Breachesofsteelcagesin2022:47outof88%ofthetotal732attemptsNumberofsitesremediated:230in2022,Volumeofspillscausedbythird-party776intotalsince2016interferenceandotherillegalactivities:lessthan600tonnes,99%ofthetotalvolumeSPDChasanongoingprogrammetoappraise,maintainandreplacekeysectionsofpipelinesandflowlinestoreducethenumberofoperationalspills.In2022,around27kilometresofpipelinesandflowlineswerereplaced.Regardlessofthecauseofaspill,SPDCcleansupandremediatesareasaffectedbyspillsoriginatingfromitsfacilities.Withoperationalspills,itpayscompensationtoaffectedpeopleandcommunities.In2022,thetimeneededtocompletetherecoveryoffree-phaseoil–oilthatformsaseparatelayerandisnotmixedwithwaterorsoil–remainedataroundoneweek.SPDCcontinuestoreviewitsportfoliooptionsforonshoreoilinNigeriaandhasreduceditslicencesinthisareabyhalfinthepastdecade.FormoredetailedinformationonspillsinNigeriain2022andourresponseseewww.shell.com.ng/oil-spills.ReadmoreonspillpreventionandresponseinNigeriaatwww.shell.com.ng/environment.MoreinthisreportContributingtoNigeria'seconomyPreparingforemergenciesOurapproachtosafetyMoreonShellwebsitesOurstrategy:PoweringProgressOilspilldataShellNigeriaShellNigeriaNigeriaBriefingNotes19ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesTransportsafetyTransportinglargenumbersofpeople,productsandequipmentbyroad,rail,seaandairposessafetyrisks.Weseektoreducetheserisksbydevelopingbest-practicestandardswithinShell.Wealsoworkwithspecialistcontractors,industrybodies,non-governmentalorganisationsandgovernmentstofindwaysofreducingtransportsafetyrisks.SafetyatseaWeoperateaglobalfleetof25tankers,liquefiednaturalgascarriersandtheworld’sfirstliquefiedhydrogencarrier,theSuisoFrontier.Weareoneoftheworld’slargestcharterersofoilandgasvessels.Wealsorunsafetychecks(assurance)formorethan70,000voyageproposalsannually,enablingShell’sbusinessestoplayavitalroleinprovidingenergysecuritysafely.ThelastseriousinjuryorfatalityonaShell-operatedvesselwasin2015.AirsafetyIn2022,ourownedandcontractedaircraftflewmorethan35,000hoursandsafelycarriedaround266,000Shellemployeesandcontractorstodestinationsallovertheworld.Inaddition,remotelypilotedaircraft,alsocalleddrones,safelycompletedaround1,000hoursofsurveyandinspectionflights.RoadtransportsafetyperformanceIn2022,Shellemployeesandcontractorsdrovearoundhalfabillionkilometresonbusinessinmorethan50countries,whichisbroadlyinlinewith2021.TherewasonefatalityinPakistanwhenacontractorcolleaguediedduringroadtransportactivitiesundertheoperationalcontrolofShell.Thenumberofseveremotorvehicleincidentsincreasedfrom8in2021to14in2022.Datashowthataround75%ofvehicleincidentsarerelatedtofatigueordistraction.In2022,weinstalledfatigueanddistractiondetectiondevicesinaround2,400vehiclesoperatedbyShelloritscontractorsincountrieswhereroadtransportrisksarehighest.Thedevicesalertdriversiftheydetectfatigueordistraction.Readmoreabouttransportsafetyatwww.shell.com/sustainability/safety/transport-safety.MoreinthisreportProcesssafetyOurapproachtosafetyLetterfromtheCEOMoreonShellwebsitesOurstrategy:PoweringProgressTransportsafetyCommunityroadsafetyProductstewardshipWeworktoensureourproducts–suchasfuels,lubricantsandchemicals–aresafethroughouttheirlifecycle.In2022,wecarriedoutmorethan500riskassessmentsforproductsandadditives.Wealsopublishedanddistributedaround110,000safetydatasheetstocustomersinabout180countries.Readmoreaboutproductstewardshipatwww.shell.com/product-stewardship.MoreinthisreportCirculareconomyandwasteDrivinginnovationLetterfromtheCEOMoreonShellwebsitesOurstrategy:PoweringProgressProductstewardship20ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataAchievingnet-zeroemissionsOurPoweringProgressstrategyfocusesonworkingwithourcustomersandacrosssectorstoacceleratethetransitiontonet-zeroemissions.22Energytransition25Managinggreenhousegasemissions32Providinglower-carbonelectricity34Fuellingmobility36Drivinginnovation21ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataEnergytransitionOurjourneytoachievingnetzeroPOWERINGPROGRESSWorkingwithourcustomersandacrosssectorstohelpacceleratethetransitiontonet-zeroemissions.Shell’sclimatetargetistobecomeanet-zeroemissionsenergybusinessby2050.OurtargetsincludereducingourabsoluteScope1and2emissionsby50%by2030comparedto2016levels,onanetbasis,andreducingthecarbonintensityoftheenergyproductswesellby6-8%by2023,9-12%by2024,9-13%by2025,20%by2030,45%by2035and100%by2050.ShellsupportsthemoreambitiousgoaloftheParisAgreement,whichistolimittheriseinglobalaveragetemperaturethiscenturyto1.5degreesCelsiusabovepre-industriallevels.Ourtargetistobecomeanet-zeroemissionsenergybusinessby2050.Wealsohaveshort-,medium-andlong-termtargetstoreduceourcarbonintensity,measuredusingournetcarbonintensitymetric.Webelievethesetargetsarealignedwitha1.5°CpathwayderivedfromthescenariosusedintheIPCCSpecialReportonGlobalWarmingof1.5°C,mostofwhichshowtheglobalenergysystemreachingnetzerobetween2040and2060.Becominganet-zeroemissionsenergybusinessmeansthatwearereducingemissionsfromouroperationsandfromthefuelsandotherenergyproducts,suchaselectricity,thatweselltoourcustomers.Italsomeanscapturingandstoringanyremainingemissionsusingtechnology,protectingnaturalcarbonsinksandprovidinghigh-qualitycarboncreditstoourcustomerstocompensateforhard-to-abateemissions.WefollowtheGreenhouseGasProtocol’sCorporateAccountingandReportingStandard,whichdefinesthreescopesofgreenhousegasemissions:Scope1:directgreenhousegasemissionsfromsourcesunderShell’soperationalcontrol.Scope2:indirectgreenhousegasemissionsfromthegenerationofpurchasedenergyconsumedbyShellassetsunderoperationalcontrol.Scope3:otherindirectgreenhousegasemissions,includingemissionsassociatedwiththeuseofenergyproductssoldbyShell.Scope3emissionsfromtheenergyproductswesellaccountformostofthetotalemissionswereport.InOctober2021,insupportofour2050net-zeroemissionstarget,wesetatargettoreduceScope1and2absoluteemissionsfromassetsandactivitiesunderouroperationalcontrol(includingdivestments)by50%by2030,comparedwith2016levelsonanetbasis(includingcarboncredits).Wehavealsoestablishedremunerationpolicieswhicharedesignedtosupportusinachievingourshort-termclimatetargets.Readmoreaboutourclimatetargetsatwww.shell.com/energy-and-innovation/the-energy-future/what-is-shells-net-carbon-footprint-ambition/faq.htmlandinour2022AnnualReportand2022EnergyTransitionProgressReport.Assessingclimate-relatedrisksShellhasidentifiedclimatechangeandtheassociatedenergytransitionasamaterialrisk.Theriskcouldpotentiallyresultinchangestothedemandforourproducts,ouroperationalcosts,supplychains,markets,theregulatoryenvironment,ourlicencetooperateandlitigation.AsShellhasoperationsbothonshoreandoffshore,thepotentialphysicalimpactsofclimatechangeareimportantforustomanage.Wetakeclimatevariabilityintoconsiderationinthedesignandoperationofourassetsandinfrastructuretominimisetheriskofadverseincidentstoouremployeesandcontractors,thecommunitieswhereweoperate,ourequipmentandinfrastructure.Projectsunderdevelopmentthatareexpectedtohaveamaterialgreenhousegasimpactmustmeetourinternalcarbonperformancestandardsorindustrybenchmarks.Ourperformancestandardsareusedformeasuringaproject’saveragelifetimegreenhousegasintensityorenergyefficiencyperassettype.Applyingthesecriteriaensuresthatourprojectscancompeteandprosperintheenergytransition.Anexceptionprocessisinplacetomanagespecificincidentalcases.ReadmoreaboutShell’smaterialclimate-relatedrisksandopportunitiesinour2022AnnualReport.MoreinthisreportOurPoweringProgresstargetsManaginggreenhousegasemissionsLetterfromtheCEOPerformanceoverviewMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsOurclimatetargetOurclimatetarget:frequentlyaskedquestions22ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataEnergytransitionAmericasEuropeAsia-PacificinactionMiddleEastAselectionof2022developments[A]AfricaAmericasCarbonextEuropeNatureEnergyMiddleEastNorthFieldEastandSouthRaízensolar-konzeptItaliaBrazilChemicalsParkScotfordDenmarkSBRSQatarCanadaItalyHollandseKustwestTrinidadColibriGermanyHollandHydrogenIAsia-PacificPowershopandShellEnergyRetailWestWindTobagoNewYorkBightNetherlandsNorthernLightsAustraliaKondininEnergyShellPolymersMonacaGreenTieCapitalElectrolyserUSAAeraEnergyNorwayWebattEnergiaChinaSprngEnergyDeerParkRefinerySpainScotWindIndiaBaramDeltaMobileRefineryFoursolarprojectsMalaysiaRosmari-MarjoramShellEnergyUnitedPhilippinesMalampayaSavion(acquiredDec.2021)KingdomDaystarPowerRussiaSalymSingaporeEcoOilsAfricaNigeriaKeyElectricityBiofuelsHydrogenLiquefiedDivestmentsnaturalgasCarboncaptureCarboncredits(includingandstoragenature-basedsolutions)Chemicals[A]Thesedevelopmentsincludeacquisitions,investments,projectsanddivestments/withdrawals,atvariousstagesofmaturityandwithdifferentlevelsofShellinterest,fromminorityinvestmenttofullownership.MoreinthisreportOurjourneytoachievingnetzeroProvidinglower-carbonelectricityCarboncaptureandstorageMoreonShellwebsitesNaturebasedsolutionsCarboncaptureandstorage23ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataDeliveringourclimatetargetsInvestinginnetzeroIn2022,weinvested$8.2billioninlow-carbonenergyandnon-energyproducts,aroundathirdofourtotalcashcapitalexpenditure[A]of$25billion.Ofthat,weinvested$4.3billioninlow-carbonenergysolutions,anincreaseof89%comparedwiththepreviousyear.Thisincludescapitalspendingonbiofuels,hydrogenandchargingforelectricvehicles,aswellaswindandsolarpower[B].Theremaining$3.9billionwasinvestedinnon-energyproductssuchaschemicals,lubricantsandconvenienceretail,whichdonotproduceemissionswhentheyareusedbyourcustomers.Ourinvestmentinnon-energyproductsdecreasedby9%comparedwith2021.Theseinvestmentsadvanceacentralpartofourstrategy,whichistosellmoreproductswithlow-carbonemissionstohelpbothShellandourcustomersmeettheirclimatetargets.Seeour2022EnergyTransitionProgressReportand2022AnnualReporttolearnmoreaboutourinvestmentsinenergyin2022.[A]PleaserefertotheShellAnnualReportandAccounts2022forthedefinitionofcashcapitalexpenditure.[B]The$4.3billioninvestmentdoesnotincludetheacquisitionofNatureEnergyforaround$2billion,whichclosedatthebeginningof2023.NetcarbonintensityShell’snetcarbonintensityistheaverageintensity,weightedbysalesvolume,oftheenergyproductssoldbyShell.Itistracked,measuredandreportedusingtheNetCarbonFootprintmethodology.WeexpressournetcarbonintensityasthegramsofCO2equivalentpermegajoule(gCO2e/MJ)producedforeachunitofenergydeliveredto,andusedby,aconsumer.In2022,Shell’snetcarbonintensitywas76gCO2e/MJ,a1.3%decreasefromthepreviousyearanda3.8%reductioncomparedwith2016,thereferenceyear.Thedecreaseinournetcarbonintensityin2022wasprimarilyduetoanincreasedproportionofrenewablepowerandcorrespondingreductioninthecarbonintensityofourpowersales.Our2022netcarbonintensityincludes4.1milliontonnesofemissionsoffsetthroughtheuseofcarboncredits,comparedwith5.1milliontonnesthatwereincludedinour2021netcarbonintensity.Thenetcarbonintensityonlyincludescarboncreditsthatareretiredagainstenergyproducts.Thebiggestdriverforreducingournetcarbonintensityisincreasingthesalesof,anddemandfor,low-carbonenergy.Weundertakeexternalverificationofournetcarbonintensityannually,andwehavereceivedthird-partylimitedassuranceonournetcarbonintensityfortheperiod2016to2022byLRQA.Limitedassurancemeansnothinghascometotheverifier’sattentionthatwouldindicatethenetcarbonintensitydataandinformation,aspresentedintheNetCarbonIntensityAssertion,werenotmateriallycorrect.ReadmoreaboutourNetCarbonFootprintmethodologyinour2022AnnualReportandatwww.shell.com/ncf.Netcarbonintensity[A][B]GramsofCO2equivalentpermegajoule(gCO2e/MJ)85807570656013141516171819202122[A]ThenetcarbonintensitycalculationusesShell’senergyproductsalesvolumedata,asdisclosedintheAnnualReportandSustainabilityReport.Thisexcludescertaincontractsheldfortradingpurposesandisreportednetratherthangross.Business-specificmethodologiesfornetvolumeshavebeenappliedtooilproducts,pipelinegasandpower.Papertradesthatdonotresultinphysicalproductdeliveryareexcluded.RetailsalesvolumesfrommarketswhereShelloperatesundertrademarklicensingagreementsarealsoexcludedfromthescopeofShell’scarbonintensitymetric.[B]Acquisitionsanddivestmentsareincludedintheactualperformancetracking,withthetargetandreferenceyearunchanged.Notethatacquisitionsanddivestmentscouldhaveamaterialimpactonmeetingthetargets.AbsoluteemissionsreductionperformanceIn2022,ourtotalcombinedScope1and2absolutegreenhousegasemissions(fromassetsandactivitiesunderouroperationalcontrol)were58milliontonnesonaCO2equivalentbasis,a15%reductioncomparedwith2021,anda30%reductioncomparedwith2016,thebaseyear.OurScope3emissionsfromenergyproductsincludedinournetcarbonintensitywere1,174milliontonnesofCO2equivalent.24ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataScope1and2emissionsunderoperationalcontrolMilliontonnesCO2e1001211108880b1173716060201720187063740a722021512020192020202202016aScope1emissions-directGHGemissions[A][B][C]bScope2emissions-market-basedmethod[D][A]Greenhousegasemissions(GHG)comprisecarbondioxide,methane,nitrousoxide,hydrofluorocarbons,perfluorocarbons,sulphurhexafluorideandnitrogentrifluoride.Thedataarecalculatedusinglocallyregulatedmethodswheretheyexist.Wherethereisnolocallyregulatedmethod,thedataarecalculatedusingthe2009APICompendium,whichistherecognisedindustrystandardundertheGHGProtocolCorporateAccountingandReportingStandard.Thereareinherentlimitationsontheaccuracyofsuchdata.Oilandgasindustryguidelines(Ipieca,APIandIOGP)indicatethatseveralsourcesofuncertaintycancontributetotheoveralluncertaintyofacorporateemissionsinventory.WehaveestimatedtheoveralluncertaintyforourdirectGHGemissionstobearound3%for2022.[B]GHGemissionswerecalculatedusingglobalwarmingpotential(GWP)factorsfromtheIPCC’sFourthAssessmentReport.Forcomparison,ourScope1emissionswouldhavebeen51milliontonnesin2022ifweweretouseGWPsfromtheIPCC'sFifthAssessmentReport.[C]GHGemissionsinthistabledonotincludecarboncredits.[D]Weestimatedtheuncertaintyofour2022Scope2GHGemissionstobearound7%.MoreinthisreportManaginggreenhousegasemissionsOurPoweringProgresstargetsLetterfromtheCEOPerformanceoverviewMoreonShellwebsitesOurstrategy:PoweringProgressOurclimatetargetOurclimatetarget:frequentlyaskedquestionsManaginggreenhousegasemissionsGreenhousegasemissionsGreenhousegasemissionsperformanceIn2022,ourtotalcombinedScope1and2absolutegreenhousegasemissions(fromassetsandactivitiesunderouroperationalcontrol)were58milliontonnesonaCO2equivalentbasis,a15%reductioncomparedwith2021anda30%reductioncomparedwith2016,thebaseyear.OurScope3emissionsfromenergyproductsincludedinournetcarbonintensitywere1,174milliontonnesofCO2equivalent.Ourdirect(Scope1)greenhousegasemissionsdecreasedfrom60milliontonnesofCO2equivalentin2021to51milliontonnesofCO2equivalentin2022.DirectgreenhousegasemissionsMilliontonnesCO2equivalent10050013141516171819202122Thereductionwasachievedbydivestmentsin2021and2022(includingtheDeerParkandPugetSoundrefineriesintheUSA);thehandoverofoperationsinOML11inNigeriain2022;theshutdownorconversionofexistingassets,includingtheshutdownofsomeunitsattheShellEnergyandChemicalsParkSingapore;andgreenhousegasabatementprojectsandthepurchaseofrenewableelectricity.ThesedecreaseswerepartlyoffsetbythecommissioningofShellPolymersMonaca,ournewpolyethyleneproductionfacility,intheUSA.In2022,weimplementedavarietyofmeasurestoreducetheenergyuseandincreasetheenergyefficiencyofouroperations.Examplesofsomeoftheprincipalmeasurestakenin2022arelistedinour2022AnnualReport.25ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataScope1andScope2greenhousegasemissionschangesfrom2016to2021andfrom2021to2022Milliontonnescarbondioxideequivalent(CO2e)905.08583b8075c(9.2)6.6f68b0.070(15.4)de(2.3)aac(2.0)(0.9)f0.45865(7.5)dea6020225520212016aEmissions[A]dReductionactivitiesandpurchasedrenewableelectricity[B][C][D][E]bAcquisitionseChangeinoutput[F]cDivestmentsfOther[A]TotalScope1andScope2emissions,roundedtotheclosestmilliontonnes.Scope2emissionswerecalculatedusingthemarket-basedmethod.[B]InadditiontoreductionsfromGHGabatementandenergyefficiencyprojects,thiscategoryalsoincludesreductionsfromthepermanentshutdownoftheConventandTabangaorefineriesandtheimpactoftransformationalactivitiesatourShellEnergyandChemicalsParkinSingapore.[C]Excludes5.80milliontonnesofCO2capturedandsequesteredbytheShell-operatedQuestCCSfacilityinCanadain2016-2021.Scope1and2GHGemissionsfromoperatingQuestareincludedinourtotalemissions.[D]Excludes0.97milliontonnesofCO2capturedandsequesteredbytheShell-operatedQuestCCSfacilityinCanadain2022.Scope1and2GHGemissionsfromoperatingQuestareincludedinourtotalemissions.[E]Ofthe2,010thousandtonnesofreductionactivitiesandpurchasedrenewableelectricityin2022,around80thousandtonnesrelatedtopurchasedrenewableelectricity.[F]Changeinoutputrelatestochangesinproductionlevels,includingthoseresultingfromshutdownsandturnaroundsaswellasproductionfromnewfacilities.Ourindirectgreenhousegasemissionsassociatedwithimportedenergy(Scope2,consolidatedusingtheoperationalcontrolboundary)decreasedfrom8milliontonnesofCO2equivalentin2021to7milliontonnesofCO2equivalentin2022(usingthemarket-basedmethod),inpart,duetodivestments.WeundertakeexternalverificationofourgreenhousegasemissionsannuallybyLRQA.OurScope1and2greenhousegasemissionsfromassetsandactivitiesunderouroperationalcontrolandtheemissionsassociatedwiththeuseofourenergyproducts(Scope3)includedinournetcarbonintensityhavebeenverifiedtoaleveloflimitedassurance.Limitedassurancemeansnothinghascometotheverifier’sattentionthatwouldindicatethegreenhousegasdataandinformation,aspresentedintheGreenhouseGasStatement/Assertion,werenotmateriallycorrect.Readourmostrecentassurancestatementsatwww.shell.com/ghg.MoreinthisreportOurjourneytoachievingnetzeroDeliveringourclimatetargetsMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsEnergyefficiencyinouroperationsOneofthemetricsweusetomeasureourperformanceisenergyintensity:theamountofenergyconsumedforeveryunitofoutput.Energyintensity–refiningRefineryEnergyIndex[A]1101009013141516171819202122[A]Dataareindexedto2002,basedonSolomonAssociatesEnergyIntensityIndexmethodology.Therefineryenergyintensityindexdecreasedfrom96.9in2021to95.6in2022,inpartduetohigherutilisationrates,notablyattheShellEnergyandChemicalsParkSingaporeandNorcorefineryintheUSA.26ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataEnergyintensity–chemicalplantsChemicalenergyintensity–gigajoulespertonneofproduction3015013141516171819202122Chemicalsteamcrackerenergyintensityin2022was19.3gigajoulespertonne(GJ/tonne)ofhigh-valuechemical(HVC)production,upfrom18.1GJ/tonneHVCin2021.Theincreasewasinpartduetoeconomicunder-utilisationandlessdemandacrossoursites.Energyintensity–upstream(Excl.liquefiednaturalgasandgas-to-liquids)-gigajoulespertonneofproduction21013141516171819202122In2022,theoverallenergyintensityfortheproductionofoilandgasinourUpstreamandIntegratedGasbusinesses(excludingliquefiednaturalgasandgas-to-liquids)increasedfrom1.14in2021to1.19.MoreinthisreportOurjourneytoachievingnetzeroSustainabilityatShellOurstandardsandpoliciesMoreonShellwebsitesOurstrategy:PoweringProgressReducingmethaneemissionsinshaleoilandgasGreenhousegasemissionsMethaneemissionsPOWERINGPROGRESSWehavesetatargettokeepourmethaneemissionsintensityforoperatedoilandgasassets(includingliquefiednaturalgas)below0.2%by2025.Methaneisapotentgreenhousegas.Whenitisreleasedintotheatmosphereithasamuchhigherglobalwarmingimpactthancarbondioxide.Naturalgasconsistsmainlyofmethane.MethaneemissionsperformanceShell’smethaneemissionsintensitytargetcoversalloilandgasassets(includingliquefiednaturalgas)forwhichShellistheoperator.In2022,wemetourtargettokeepmethaneemissionsintensitybelow0.2%.Ourmethaneemissionsintensityaveraged0.05%forassetswithmarketedgasand0.01%forassetswithoutmarketedgas.Itrangedfrombelow0.01%to0.7%in2022,comparedwithbelow0.01%to1.5%in2021.MethaneemissionsThousandtonnes1501005001314151617181920212227ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataMethaneemissionsbysourcein2022Percentage15%14%d41%aVentingandprocesscabFlaringbcFugitivedCombustion30%In2022,Shell’stotalmethaneemissionswere40thousandtonnescomparedwith55thousandtonnesin2021.Thedecreasewas,inpart,duetoashutdownoftheTransNigerPipeline,thehandoverofoperationsinOML11andreducedflaringatSNEPCo(allinNigeria),aswellasthedivestmentofourPermianassetsintheUSA.Methaneemissionswerelessthan2%ofShell’sgreenhousegasemissionsonaCO2equivalentbasisin2022.Around65%ofourreportedmethaneemissionsin2022camefromflaringandventinginourupstreamandmidstreamoperations.Overthelastfewyears,wehaveimplementedmoreaccuratemethodsforcalculatingfugitiveemissions.Wealsoencourageindustry-wideactiononmethaneemissionsreductionbyparticipatinginvoluntaryinitiatives.Forexample,weco-developedthevoluntaryUN-ledOil&GasMethanePartnership(OGMP)2.0reportingframeworkandcontinuetoimplementenhancedmethaneemissionsmeasurementandreporting.UnderOGMP2.0,ShellachievedGoldStandardstatusforthe2022reportingyear.Weparticipateinothermulti-stakeholdergroups,suchastheMethaneGuidingPrinciples(MGP)coalition,whichweinitiatedin2017,theOilandGasClimateInitiative(OGCI)andtheWorldBank’sZeroRoutineFlaringby2030initiative.In2022,membersofMGP,includingShell,developedanoilandgassectortoolkit,whichconnectspolicymakersandregulatorswithresourcesandinstitutionstosupportmethanepolicyandregulationdevelopmentincountriesthatjoinedtheGlobalMethanePledge.In2022,OGCIlaunchedtheAimingforZeroMethaneEmissionsby2030initiative,whichShelljoined.WecontinuetoreducemethaneemissionsourcesacrossShell-operatedassets.Forinstance,wehavereducedreportedmethaneemissionsatourQGCnaturalgasprojectinAustraliabyusingmultipleapproachestodetectandpreventemissions,includingreducedflaringandventing,aswellasimplementingmoreaccuratemethodsforcalculatingfugitiveemissions.Wealsoworkwithourjointventurestohelpthemdevelopemissionmonitoringprogrammes.Forexample,in2022,weheldsessionswithseveraljoint-venturepartnerstodiscusstheimportanceofmethaneemissionsmanagementandthebenefitsoftheOGMP2.0reportingframework.ReadmoreaboutShellandmethaneemissionsatwww.shell.com/energy-and-innovation/natural-gas/methane-emissions.MoreinthisreportOurjourneytoachievingnetzeroManaginggreenhousegasemissionsProducingoilandnaturalgasMoreonShellwebsitesOurstrategy:PoweringProgressMethaneemissionsReducingmethaneemissionsinshaleoilandgasGreenhousegasemissionsAirqualityFlaringPOWERINGPROGRESSWehavecommittedtoeliminateroutinegasflaringfromourUpstream-operatedassetsby2025.Weareworkingtoreduceflaring,whichisinefficientandcontributestoclimatechange.Routineflaringofgasoccursduringnormaloilproductionifitisnotpossibletousethegasorreinjectitintothewell.In2021,webroughtforwardourtargettoeliminateroutineflaringfromourUpstreamoperationsto2025from2030.Thisacceleratesourcommitmentof2015toendroutineflaringasasignatorytotheWorldBank’sZeroRoutineFlaringby2030initiative.FlaringperformanceFlaringofgasinourUpstreamandIntegratedGasbusinessescontributedaround6%toouroveralldirectgreenhousegasemissionsin2022.28ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataFlaring–upstreamhydrocarbonsflared[A]Milliontonnes63013141516171819202122[A]IncludestheUpstreamandIntegratedGasbusinesses.In2022,0.8milliontonnesofhydrocarbonswereflared,whichisdownfrom1.3milliontonnesin2021.Alsoin2022,routinehydrocarbonflaringwas0.1milliontonnes,adecreasefrom0.2milliontonnesin2021.Flaring–upstreamCO2equivalent[A]MilliontonnesCO2e2010013141516171819202122[A]IncludestheUpstreamandIntegratedGasbusinesses.In2022,around10%ofgreenhousegasemissionsfromflaringoccurredatfacilitieswheretherewasnoinfrastructuretocapturethegas,downfromaround17%in2021.Overallflaringdecreasedto3.0milliontonnesofcarbondioxideequivalent(CO2e)in2022from4.5milliontonnesofCO2ein2021.Around50%offlaringinourUpstreamandIntegratedGasfacilitiesin2022occurredinassetsoperatedbytheShellPetroleumDevelopmentCompanyofNigeriaLimited(SPDC)andShellNigeriaExplorationandProductionCompanyLimited(SNEPCo).TherewerereductionsinflaringfromSPDC-operatedfacilitiesofaround45%in2022comparedwith2021.Thiswasdue,inpart,toashutdownoftheTransNigerPipelineandthehandoverofoperationsinOML11.Inaddition,flaringatSNEPCo-operatedfacilitiesdecreasedbyaround60%in2022comparedwith2021.Thisreductionwasbecausealargeamountofgaswasflaredin2021attheBongaoffshoreproductionfacility,asthefacilitycontinuedtoproduceoilwhilerepairswerebeingmadeonthegasexportline.Readmoreaboutourflaringreductioncommitmentatwww.shell.com/inside-energy/zero-routine-flaring-by-2025.MoreinthisreportOurjourneytoachievingnetzeroEnergytransitionManaginggreenhousegasemissionsMoreonShellwebsitesOurstrategy:PoweringProgressReducingflaringinshaleoilandgasExternalvoluntarycodesAirqualitySectoraldecarbonisationPOWERINGPROGRESSWorkingwithourcustomersandacrosssectorstoacceleratethetransitiontonet-zeroemissions.Helpingtotransformenergydemandisthefocusofourapproachtodecarbonisation.Tohelptransformdemand,weareworkingwithcustomerssector-by-sectoracrosstheenergysystem.Wewillchangethemixofenergyproductsweselltoourcustomersastheirneedsforenergychange.ThisisreflectedinShell’sstrategytodevelopaportfoliothatseeksto:providemoreelectricitytocustomers,whilealsodrivingashifttorenewableelectricity;developlow-andzero-carbonalternativestotraditionalfuels,includingbiofuels,hydrogen,andotherlow-andzero-carbongases;workwithourcustomersacrossdifferentsectorstodecarbonisetheiruseofenergy;andaddressanyremainingemissionsfromconventionalfuelswithsolutionssuchascarboncaptureandstorageandcarboncredits.Becauseemissionsresultingfromcustomeruseofourenergyproductsmakeupmostofthecarbonemissionswereport,webelievewecanmakethegreatestcontributiontotheenergytransitionbyincreasingsalesoflow-carbonenergyproductsandservices.29ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataReadmoreaboutsectoraldecarbonisationatwww.shell.com/energy-and-innovation/the-energy-future/cutting-carbon-together-sector-by-sectorandinour2022EnergyTransitionProgressReport.MoreinthisreportOurjourneytoachievingnetzeroMoreonShellwebsitesOurstrategy:PoweringProgressReducingmethaneemissionsinshaleoilandgasGreenhousegasemissionsCarboncreditsincludingnature-basedsolutionsPOWERINGPROGRESSOurnature-basedsolutionprojects,whichprotect,transformorrestoreland,willhaveanetpositiveimpactonbiodiversity,startingimplementationin2021.Inordertobecomeanet-zeroemissionsenergybusinessby2050,weareworkingtoreduceemissionsfromourownoperationsandfromthefuelsandotherenergyproducts,suchaselectricity,weselltoourcustomers.Forremainingemissions,weofferandusehigh-qualitycarboncredits,includingfromnature-basedsolutions.Tohelpusdothat,weinvestdirectlyinnaturalecosystemprojectstoincreasethesupplyofcarboncreditsandhelpmeetgrowingdemand.Wealsobuycarboncreditsgeneratedbyothernature-basedprojectsandbytechnologiessuchasfuel-efficientcookstoves.Nature-basedsolutionsprotectandenhancenaturalecosystems–suchasforests,grasslands,wetlandsandcoastalzones–orimproveagriculturalsustainabilitybyabsorbingorpreventingthereleaseofgreenhousegases.Aspartofourselectioncriteriafornature-basedsolutions,welookforprojectsthatwillhaveanetpositiveimpactonbiodiversity(seeRespectingnature).Projectsneeddifferentlevelsoffundingatdifferentstagesofdevelopment.In2022,wedeployed$92million:$69millionfornature-basedprojectsand$23millionfortechnology-basedprojectsthatgeneratecarboncredits.For2022,weretiredaround5.8millioncarboncreditsonbehalfofourcustomers,ofwhich4.1millioncreditsareincludedinournetcarbonintensityand1.7millioncreditsareassociatedmainlywiththesaleofnon-energyproductsandShell’sbusinesstravel(onecarboncreditrepresentstheavoidanceorremovalof1tonneofCO2).Thesenumbersexcludedirectcarbontradingactivities.Wecarefullysourceandscreenthecreditswepurchaseandretirefromthemarket,andworkwithcertificationstandardsandratingagenciestocheckthatourrequirementsaremet.In2022,weacquiredaminoritystakeinCarbonext,Brazil’slargestdeveloperofREDD+projects(REDD+isaframeworkcreatedbytheUNFCCCConferenceofthePartiestoguideactivitiesthatreduceemissionsfromdeforestationandforestdegradation).CarbonextiscurrentlyworkingontheprotectionoftwomillionhectaresofAmazonrainforest.WearealsosupportingaforestconservationprojectinthePhilippines,whereweareworkingwithuniversitiesandlocalorganisationstorestoremorethan10,000hectaresofdeforestedland.Weoffercustomerstheopportunitytopurchasehigh-qualitycarboncreditswiththeShellfueltheybuytohelpcompensatefortheCO2emissionsgeneratedbytheextraction,refining,distributionanduseoftheproduct.Thisofferisavailabletoourfleetcustomersin21countriesandtoretailcustomersatmorethan4,000servicestationsinninecountries.In2022,wedelivered11carbon-compensatedliquefiednaturalgas(LNG)cargoestocustomersacrosstheglobe,andforthefirsttime,agreenhousegas--neutralLNGcargoinlinewiththeframeworkoftheInternationalGroupofLiquefiedNaturalGasImporters(GIIGNL).Readmoreaboutnature-basedsolutionsatwww.shell.com/energy-and-innovation/new-energies/nature-based-solutions.MoreinthisreportOurjourneytoachievingnetzeroCarboncaptureandstorageManaginggreenhousegasemissionsEnergytransitionMoreonShellwebsitesOurstrategy:PoweringProgressNature-basedsolutionsCarboncaptureandstorageShell’sambitionistoworkwithgovernments,customersandpartnerstounlockthepotentialforCCStoreduceemissionswheretherearecurrentlynoscalablelow-carbonalternatives.In2022,Shell’soperatingcostsfor,andinvestmentin,CCSopportunitiesamountedtoaround$220million,anincreaseof51%on2021.Bytheendof2022,ourQuestCCSprojectatScotfordinCanada(Shellinterest10%)hadcapturedandsafelystoredmorethan7.5milliontonnesofCO2sinceitbeganoperatingin2015.WeareexploringthepossibilityofincreasingCCScapacityatScotford,initiallyby750,000tonnesperyear,throughourproposedPolarisprojectandAtlasCarbonSequestrationHub.InAustralia,theGorgonCCSproject(Shellinterest25%,operatedbyChevron),reportedithadstoredmorethan7milliontonnesofCO2bytheendofOctober2022.Despitethesesignificantemissionreductions,GorgonhascapturedandstoredlessCO2thanrequiredtofulfilitsregulatoryobligations.In2022,Chevronconfirmedithadpurchasedcarboncreditstoaddresstheshortfall.Inaddition,thejointventureaimstoinvestAUD40millioninlower-carbonprojectsinWesternAustralia.Gorgonstartedoperatingin2019andisthelargestCCSoperationintheworld.30ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataIn2022,ourNorthernLightsCCSjointventure(Shellinterest33.3%)inNorwaysignedaletterofintenttoprovideYara,thecropnutritioncompany,withCO2transportandstorageservices.Asof2024,some800,000tonnesofCO2peryearareexpectedtobecaptured,compressedandliquefiedataYaraammoniaandfertiliserplantintheNetherlands.TheCO2willthenbetransportedtoNorwayforpermanentstorage2,600metresbelowtheseabedintheNorthSea.Duringtheyear,wesignedagreementswithvariouscompaniesandgovernmentstojointlyexploredevelopingCCSprojectsinBrunei,China,Japan,Malaysia,SouthKorea,theUSAandWesternAustralia.ReadmoreaboutourCCSprojectsatwww.shell.com/ccs.CCSprojectsProjectCO2sourceCountryShellShellTotalcapacityShell-operatedinvolvementinterest(100%),millionCCSfacilitiesinoperationAlberta,tonnesperannumYesCanadaTechnicalNoQuestBitumenupgradingAustraliadeveloper,10%1mtpaNoNorwayoperator,25%Upto4mtpaGorgonCO2ingasNorwayJVpartnerNoJVpartner8.7%TestsiteTechnologyCentreMongstadGas-firedpower,refiningScotland,UKNotestandresearchfacilityandchemicalproductionJVpartnerNo–transportYes–storageCCSprojectsunderconstructionJVpartnerYesYesNorthernLights(Phase1)IndustrialsourcesTechnical33.3%1.5mtpaYesdeveloper,Yes–captureCCSprojectspre-FIDoptionsJVpartnerNo–transportandstorageAcorn(initial)Industrialsources30%Around6mtpaTBCAramis(initial)IndustrialsourcesNetherlandsJVpartner25%5mtpaPolarisAlberta,YesAtlasRefiningandchemicalCanadaOperatorTBC0.75mtpaTBCproductionCanadaTBCWales,UKOperatorTBC10mtpaTBCRefining,chemicalsandOperatorindustrialsourcesNetherlandsJVpartnerSouthWalesIndustrialClusterIndustrialsourcesCO2TBC1.5mtpacapture100%PernisCO2capture(forRefiningandchemical100%1.15mtpatransportandstoragebytheproduction(Shellthird-partyPorthosproject)capacity)PernisSPeCCSRefiningandchemicalNetherlandsCO2CO2captureexpansionproductioncapture0.5mtpaAsia-Pacific(ShellAsia-PacificCCShubRefiningandchemicalUSAOperatorproductionandindustrialUSATBCcapacity)USGulfCoast(Phase1)sourcesChinaJVpartnerLiberty(Phase1)AustraliaJVpartnerTBC2mtpaRefiningandchemical1.7mtpaDayaBayproduction100%NorthernCarnarvon(Angel)100%10mtpaChemicalproduction5mtpaTBCRefiningandchemical20%productionNote:JV=jointventure;FID=finalinvestmentdecision;TBC=tobeconfirmed.MoreinthisreportOurjourneytoachievingnetzeroCarboncreditsincludingnature-basedsolutionsEnergytransitionMoreonShellwebsitesOurstrategy:PoweringProgressCarboncapture:thetechnologywecannotaffordtoignore31ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataProvidinglower-carbonelectricityIntegratedpowerWearebuildinganintegratedpowerbusinessspanninggeneration,trading,storageandsupplytopowerhomes,businessesandvehicles.Weservemorethan2millioncustomerswithrenewableelectricity,gasandsmarthometechnologyinAustralia,Germany,theNetherlands,theUKandtheUSA.In2022,wesold243terawatt-hoursofelectricity,whichisenoughtomeettheannualneedsofAustraliaorSpain.In2022,weinvested$3.5billioncashcapitalexpenditureinourRenewablesandEnergySolutionsbusiness,whichexceededouraimof$3billion.Lower-carbonelectricityhasabigroletoplayinreducinggreenhousegasemissions.WewonbidswithourpartnerstobuildfouroffshorewindfarmsintheNetherlands,theUKandtheUSA,andweextendedouronshorewindactivitiesintoAustraliaandthePhilippines.WealsoacquiredsolarpowerbusinessesinIndia,ItalyandSpain,energyretailinterestsinAustralia,andexpandedourelectricvehicleoperationsglobally.FindoutmoreaboutourRenewablesandEnergySolutionsbusinessinour2022AnnualReport.Readmoreaboutlower-carbonandrenewablepoweratwww.shell.com/res.MoreinthisreportProvidingaccesstoenergyEnergytransitionMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsElectricityWindpowerSolarWindWehavewindpowerinterestsinoperation,underconstructionorunderdevelopmentinseveralcountries,includingonshoreintheNetherlandsandtheUSAandoffthecoastsoftheNetherlands,Norway,SouthKoreaandtheUSA.In2022,weextendedouronshorewindpoweractivitiesintoAustraliaandthePhilippines.WealsowonbidswithourpartnerstobuildfouroffshorewindfarmsintheNetherlands,theUKandtheUSA,whichtogetherhavethepotentialtogeneratearound7.3gigawattsofpower(Shell’sshare3.75gigawatts).Attheendof2022,Shell’sshareoftotalinstalledcapacityfromonshoreandoffshorewindwas307megawattsalternatingcurrent(MWac),withafurtherShellshareof789MWacunderconstruction.Thisis160MWaclessthanin2021duetothetemporaryshutdownofourBrazosonshorewindfarminTexasforrefurbishmentandtoincreaseitsgeneratingcapacityto182MWac.Readmoreaboutwindpoweratwww.shell.com/wind.Windprojectsattheendof2022ProjectTypeCountryShellTotalcapacityShell-operatedPlannedinterest(100%),MWacstartupYesWindprojectsinoperationYesTBCNo2023Mulanur,TamilNaduOnshoreIndia100%300No2025+India100%197.5JV-operated2025+Khageshree,GujaratOnshoreUSA50%JV-operated2023USA50%62JV-operated2026WhitewaterHill,CAOnshoreNetherlands20%41Netherlands100%732YesCabazonPass,CAOnshoreNorway46%108Yes4JV-operatedBlauwwindOffshoreUSA100%JV-operatedNetherlands100%182JV-operatedNoordzeeWindOffshoreUSA50%50JV-operatedUSA50%1,509TetraSparFloatingwindNetherlands80%1,200Netherlands60%759Windprojectsunderconstruction760BrazosRepower[A]OnshorePottendijk(wind)OnshoreAtlanticShores-Project1OffshoreSouthCoastWindOffshoreCrossWindOffshoreEcowendeOffshore[A]BrazosRepowerrepresentsthecompletereplacementoftheBrazosturbines,increasingcapacityfrom160MWto182MW.32ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataMoreinthisreportProvidingaccesstoenergyEnergytransitionMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsElectricityWindpowerSolarSolarWeareexpandingoursolarphotovoltaicpowergenerationcapabilitybyinvestinginthedevelopmentandoperationofsolarprojects,includingatourownsites.In2022,weincreasedoursolarpoweractivitiessignificantlythroughacquisitionsinIndia,Italy,SpainandtheUK.Westartedproductionatthreenewsolarpowerplants:oneinQueensland,AustraliaandtwointheNetherlands,whichcangenerateupto144megawattsdirectcurrent(MWdc)and80MWdcrespectively.Wealsostartedtobuilda50MWdcsolarpowerplantintheNetherlandsaspartofourfirsthybridsolarandwindproject.In2022,ourshareofinstalledsolarpowercapacitywas1,914MWac,with340MWacunderconstruction.FiguresexcludeSiliconRanch(Shellinterest44.3%asattheendof2022,non-operated),theUSsolarpowerdeveloper.Readmoreaboutsolarpoweratwww.shell.com/energy-and-innovation/new-energies/solar.html.Solarprojectsattheendof2022CountryShellTotalcapacityShell-operatedPlannedinterest(100%),MWacstartupProjectYesNo2024Solarprojectsinoperation[A]Yes2023Yes2023-24SprngEnergyIndia100%1,192Yes202324%450Yes2023CleantechSolarAsia100%Yes2023100%252024SoharSolarQuabasOman100%24Yes2026100%20Yes2025SasvanGentNetherlands100%10No2028Yes2028MoerdijkNetherlands100%9Yes100%YesHeerenveenNetherlands25/49%575Yes100%120YesEmmenNetherlands100%106Yes100%30YesSolarprojectsunderconstructionandcommittedforsale[A]100%23Yes100%42SprngEnergyAsia100%180100%200GangarriAustralia100%100125CleantechSolarAUCAsia-Pacific100KoegorspolderTractaatwegNetherlandsSluiskilNetherlandsPottendijk(solar)NetherlandsMadisonFields[B]USAMartinCounty[B]USAMarionCounty[B]USACalhounCounty[B]USAKiowaCounty[B]USA[A]FiguresexcludeSiliconRanch(Shellinterest44.3%asattheendof2022,non-operated),theUSsolarpowerdeveloper.[B]Notyetunderconstruction.MoreinthisreportProvidingaccesstoenergyEnergytransitionMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsElectricityWindpowerSolar33ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataFuellingmobilityBiofuelsShellaimstobeamaterialandprofitablesupplierofsustainablelow-carbonfuelstohelpdecarboniseharder-to-abatesectorsincludingaviation,marineandcommercialroadtransport.Weproduceandsupplylow-carbonfuelssuchasbiodiesel,bioethanol,renewablenaturalgas(alsoknownasRNG,biogasorbiomethane),renewablediesel(alsoknownashydro-treatedvegetableoilorHVO)andsustainableaviationfuel(SAF)tohelplowerthecarbonemissionsfromtransport.Thesefuelscanbeblendedwithexistingfuels,suchasdiesel,petrolandaviationfuel,anddonotrequirecostlyinvestmentinnewinfrastructure,whichmeanstheyareapracticaloptionforreducingtransportemissions.Shellisoneoftheworld'slargesttradersandblendersofbiofuels.In2022,around9.5billionlitresofbiofuelswentintoShell’spetrolanddieselworldwide,comparedwith9.1billionlitresin2021.Thisincludedaround3billionlitresthroughourjointventureRaízen(Shellinterest44%,notShell-operated)inBrazil,comparedwith3.2billionlitresin2021.Raízenisoneoftheworld’slargestbiofuelproducers,withoneofthelowestCO2biofuelsavailabletoday.In2022,Raízenproducedaround3billionlitresofethanolfromsugarcaneandabout26millionlitresofsecond-generationcellulosicethanolmadefrominedibleagriculturalwaste.In2022,wesignedalong-termagreementtobuy3.25billionlitresofsugar-canecellulosicethanolfromRaízen,whichwillbeproducedatfivenewplantsthatRaízenintendstobuild.Oneofourprioritiesistoincreaseourlow-carbonfuelsproductioncapacity.IntheNetherlands,wearebuildingoneofEurope’slargestbiofuelproductionfacilities,whichwillproduceupto820,000tonnesperyearoflow-carbonfuelsfrompredominantlywastefeedstocks.Thefacilityisexpectedtocomeonlinein2025.Tosupportourbiofuelproductioncapacity,wearealsoinvestinginnewfeedstocks.In2022,weacquiredEcoOils,whichusesitsrecyclingtechnologytoturnwasteintospentbleachingearthoil,anadvancedbiofuelfeedstockthatcanbeusedtoproducesustainablelow-carbonfuels.Globalbiocomponentpurchasebyfeedstock[A][B]Percentage3.1%1.5%aCorn6.7%0.6%bWaste0.5%MolassescPalmoil7.1%fghijRapeseeddSoybean7.1%deeSugarcaneaOtherc44.1%fgWheatBlendedfeedstock8.1%bhij21.3%[A]DoesnotincludepurchasesbyRaízen.[B]Percentagemaynotaddupto100%becauseofrounding.SustainabilityofbiofuelsWepurchasebiocomponentstoproducebiofuels,blendintofuelsand/ortotrade.Certainbiofuelfeedstocksareconsideredhigherriskwithregardtohumanrights,biodiversityorthereleaseofcarbonintotheatmosphere.Tohelpmitigatetheserisks,allthepalmoil,sugarcaneandSouthAmericansoyfeedstockwepurchaseiscertifiedassustainableundercrediblesustainabilitystandardsliketheRoundTableonResponsibleSoyAssociation,theRoundtableonSustainablePalmOilandBonsucro.Wehavealsocommittednottousecrudepalmoiloritsderivativesinanyofourbiofuelrefineries.Readmoreaboutbiofuelsandalsoourapproachtothesustainablesourcingofbiocomponentsatwww.shell.com/biofuels.SustainableaviationfuelWecontinuetotakestepstoexpandourproductioncapacity,investinpromisingtechnologiesandincreasedemandforSAF.In2022wesignedanon-bindingmemorandumofunderstandingwithLufthansatosupplySAFforitsaircraftatairportsworldwide;westartedsupplyingSAFin34ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataSingapore,thefirstcompanytodoso,forcustomersinSouth-eastAsia;andtogetherwithAccentureandAmericanExpressGlobalBusinessTravel,welaunchedoneoftheworld’sfirstblockchainsolutionsforSAFtohelpcompaniesdecarbonisetheirbusinessairtravel.ReadmoreaboutSAFatwww.shell.com/business-customers/aviation/the-future-of-energy/sustainable-aviation-fuel.RenewablenaturalgasandbioLNGWeproducerenewablenaturalgasfromagriculturalresiduesandmanure.Itcanbeusedinsteadofnaturalgas(asrenewablecompressednaturalgasorbioLNG)invehiclesandshippingtoreduceCO2emissionsby50-100%overthelifecycleofthefuel,comparedwithfossilfuels.IntheUSA,wealreadyoperateonerenewablenaturalgas(RNG)productionfacilityinOregonandarebuildingthreemoreinIdahoandKansas.Inearly2023,wecompletedtheacquisitionofEurope’slargestRNGproducer,NatureEnergyofDenmark,whichproducesRNGfromagricultural,industrialandhouseholdwaste.ReadaboutLNGandbioLNGatwww.shell.com/energy-and-innovation/natural-gas/lng-for-transport/lng-for-road.Readaboutrenewablenaturalgasatwww.shell.com/energy-and-innovation/new-energies/low-carbon-fuels.MoreinthisreportOurjourneytoachievingnetzeroDrivinginnovationMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsLowcarbonfuelsHydrogenElectricvehiclechargingShellaimstobecomeagloballeaderinelectricvehiclecharging,meetingcustomerneedsathome,atworkorontheroad.Attheendof2022,weoperatedaround139,000publicandprivateelectricvehiclechargepoints,includingmorethan27,000publicchargepointsatShellforecourts,on-streetlocationsandatdestinationslikesupermarkets.Thisisaconsiderableincreaseonlastyear’sfiguresofaround86,000and8,000respectively.Duringtheyear,weofferedelectricvehiclechargingundertheShellRechargebrandinmorethan25countriesinAsia,Europe,theMiddleEastandtheAmericas.Wealsoformedorexpandedcollaborationswitharangeofpartners,includingelectricvehiclemanufacturers,retaildestinations,realestateowners,citiesandmunicipalities.AndweextendedourcapabilitiesinelectricvehiclechargingthroughtheacquisitionsofCableEnergía,aproviderofdestinationcharginginSpainandPortugal,andSBRS,aproviderofchargingsolutionsforcommercialelectricvehicles,includinge-buses,e-trucksande-vans.Readaboutelectricvehiclechargingatwww.shell.com/electric-vehicle-charging.MoreinthisreportOurjourneytoachievingnetzeroDrivinginnovationMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsLowcarbonfuelsHydrogenHydrogenHydrogenisaversatileenergycarrierthatcanplayasignificantroleinthetransitiontoalower-carbonworld.Weareinvestinginproducingdecarbonisedhydrogenforourownfacilitiesand,inthefuture,forcustomersinindustryandmobilitywheredirectelectrificationischallenging.In2022,wetookthefinalinvestmentdecisiontobuildHollandHydrogenIintheNetherlands,whichwillbeEurope’slargestrenewablehydrogenplantonceoperationalin2025.The200megawattelectrolyserwillproduceupto80tonnesofrenewablehydrogenperdayfortheShellEnergyandChemicalsParkRotterdam,whereitwillpartiallydecarboniseourproductionofenergyproductslikepetrol,dieselandjetfuel.TheplantwillbepoweredbyrenewableenergyfromtheHollandseKust(noord)offshorewindfarm,whichis80%ownedbyShell.Shellownsandoperatesa10megawattelectrolyserinGermanyandisajoint-venturepartnerina20megawattelectrolyser(Shellinterest47.5%)inChina.Theycanproduce1,300tonnesand3,000tonnesofhydrogenperyearrespectivelyfromrenewableelectricity.Wearealsoexpandingournetworkofhydrogenrefuellingstations.Bytheendof2022,therewerearound50hydrogenrefuellingstationsatShell-brandedoutletsintheUSA(California),Canada,GermanyandtheNetherlands.Readabouthydrogenatwww.shell.com/energy-and-innovation/new-energies/hydrogen.html.MoreinthisreportOurjourneytoachievingnetzeroDrivinginnovationMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsLowcarbonfuelsHydrogen35ShellSustainabilityReport2022SustainabilityatOurcorevaluesAchievingnet-RespectingnaturePoweringlivesGeneratingOurperformanceShellzeroemissionsshareholdervaluedataDrivinginnovationIn2022,wespent$1,067milliononresearchanddevelopment(R&D),comparedwith$815millionin2021.Wealsostartedworkonmorethan250R&Dprojectswithuniversities,comparedwithmorethan180in2021.OurR&Dactivitiesarekeytoachievingournet-zeroemissionstarget.In2022,ourR&Dexpenditureonprojectsthatcontributedtodecarbonisationwasaround$440million,representingabout41%ofourtotalR&Dspend,comparedwitharound40%in2021.Thisincludesexpenditureonreducinggreenhousegasemissions:forourcustomersthroughrenewablepowergeneration,storage,e-mobilityandotherelectrificationsolutions;fromourownoperations,forexample,byimprovingenergyefficiencyandelectrification;fromthefuelsandotherproductsweselltoourcustomers–forexample,biofuels,syntheticfuelsandproductsmadefromlow-carbonelectricity,andhydrogenproducedusingrenewablesources;bycarboncapture,utilisationandstorageappliedtohydrogenproductionfromnaturalgasandothercarbonemissions;andbyresearchingnature-basedsolutionstooffsetemissions.ExamplesofR&Dactivitiesotherthandecarbonisationincludesafety,performanceproductssuchaslubricantsandpolymers,robotics,automationandartificialintelligence.In2022,weopenedourEnergyTransitionCampusAmsterdam,formerlyoneofoursixShellTechnologyCentres.Thecampusprovidesoffices,laboratoriesandtestingfacilitiesforstart-ups,researchinstitutions,academiaandcompaniestoworktogetheronsolutionsforlower-carbonenergy.Around1,000peoplefrom50countriesarecurrentlyworkingonprojectsatthecampus.OnesuchprojectisacollaborationbetweenShellandDowtoelectrifysteamcrackingfurnaceswithrenewableenergy.Steamcrackingisoneofthemostcarbon-intensiveprocessesinpetrochemicalproduction.TheprojectcouldreduceScope1emissionsassociatedwithcrackingfurnacesby90%comparedwithconventionalcrackers.Readmoreabouttechnologyandinnovationatwww.shell.com/energy-and-innovation/the-role-technology-plays/technology-for-a-sustainable-energy-industry.MoreinthisreportSectoraldecarbonisationFuellingmobilityMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissions36ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroRespectingGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsnaturePoweringlivesRespectingnatureOurPoweringProgressstrategymeansrespectingnaturebyprotectingtheenvironment,reducingwasteandmakingapositivecontributiontobiodiversity.38Ourapproachtorespectingnature38Environmentalcollaborations39Protectingbiodiversity40Circulareconomyandwaste42Conservingwaterresources44Airquality37ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroRespectingGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsnaturePoweringlivesOurapproachtorespectingnatureWerealisethereisgrowingurgencytoprotectandenhancebiodiversity,preservewaterqualityandavailability,improveairqualityanduseresourcesmoreefficiently.Naturelossandclimatechangeareinterconnectedandneedtobetackledtogether.Thiswasrecognisedin2022attheUNClimateChangeConference(COP27),andalsoattheUNBiodiversityConference(COP15)wherealandmarkGlobalBiodiversityFrameworkwasagreed.Asabusiness,werelyonnatureforresourcessuchasland,waterandmaterialsforouroperations.Werecognisethatouractivitiescanhaveanimpactonnaturethroughdischargesandemissionstotheenvironment,andthroughchangestotheuseofland,waterandoceans.Respectingtheenvironmentandlocalcommunitieshasbeenanintegralpartofthewaywedobusinessformanyyears,assetoutintheShellGeneralBusinessPrinciplesandShellCommitmentandPolicyonHealth,Security,Safety,theEnvironmentandSocialPerformance.RespectingNatureispartofourPoweringProgressstrategy.Ourcommitmentsfocusonfourpriorityareas:biodiversity(landandmarineenvironments),water,circulareconomyandwaste,andairquality.Theysetoutourambitionsfor2030andlater,aswellasourshorter-termgoals.Wehaveincludedthesecommitmentsinourperformancemanagementandreportingsystemsandhavebeenworkingtodefinebaselinesandtrackprogress.OurExecutiveCommitteeisaccountablefordeliveryofourRespectingNaturegoals.Ourpurchasingpoliciesincluderequirementsthatreflectourenvironmentalframeworkandtaketheenergyefficiency,materialefficiencyandsustainabilityofproductsintoconsiderationinourpurchases(seeSupplychain).Wewillcontinuetoseekopportunitiestogofurther.Ourenvironmentalambitionswillbeunderpinnedbycollaborationwithoursupplychainandtransparentreporting.Readmoreaboutourapproachatwww.shell.com/sustainability/environment.MoreinthisreportSustainabilityatShellProtectingbiodiversitySocialinvestmentMoreonShellwebsitesOurstrategy:PoweringProgressRespectingnatureEnvironmentalcollaborationsPOWERINGPROGRESSOurambitionistostrengthenexternalpartnershipsandimprovetransparencyonperformance.Wewillensurethatexternalpartnershipsinformkeyareasofdevelopmentanddeliveryofourambitions.Weworkwithexternalpartiestoenableapositiveimpactontheenvironment.Collaborationcanhelpustoreducewaste,improvecircularityofmaterialsandhelpensurelocalcommunitiesbenefitfromourpresence.ExistingcollaborationsandnewpartnershipsarekeytoimplementingourRespectingNatureambitionsandcommitments.Formorethan20years,wehaveworkedwithourglobalenvironmentalpartnerstheInternationalUnionforConservationofNatureandEarthwatch.TheyprovidedinputonthedevelopmentofourRespectingNaturecommitmentsandcontinuetosupporttheirimplementation.WeworkwithEarthwatchtohelpShellstaffdeveloptheirsustainabilityleadershipskillsanddeepentheirunderstandingofourRespectingNatureambitions.In2022,morethan3,500staffweretrainedin20countries.WeareafoundingmemberoftheWorldBusinessCouncilforSustainableDevelopment,haveaseatontheexecutivecommittee,co-chairtheEnergyprogrammeandparticipateinseveralgroupsrelatedtonatureincludingbiodiversity,plasticwaste,circulareconomyandnature-basedsolutions.ShellisaViceChairofIpieca,theglobaloilandgasindustryassociationforadvancingenvironmentalandsocialperformanceacrosstheenergytransition.ShellchairsIpieca’soverallEnvironmentalWorkingGroupandisactiveinallworkstreamsonclimate,nature,peopleandsustainability.WeareasignatoryoftheBusinessforNatureCalltoAction.38ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroRespectingGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsnaturePoweringlivesTransparencyandstandardsWeareamemberoftheTaskforceonNature-relatedFinancialDisclosuresForum,whichaimstodevelopariskmanagementanddisclosureframeworkfororganisationstoreportandactonevolvingnature-relatedrisks.In2022,wejoinedtheScienceBasedTargetsNetworkCorporateEngagementProgramandarehelpingtomakeitsguidanceforsettingscience-basedtargetseasytouseandimplement.Ourmajorinstallationsarecertifiedtoindependentenvironmentalmanagementsystemstandards,suchasISO14001orequivalentsystemsrequiredbylocalregulations.Majorinstallationsincludecrudeoilandnaturalgasterminals,gasplants,mannedoffshoreproductionplatforms,refineriesandchemicalmanufacturingfacilities.Ofthese,100%werecertifiedattheendof2022.Readmoreaboutthecertificationofourmajorinstallationsinour2022AnnualReport.Morethan45%ofourofficesandlaboratoriesinourrealestateportfoliohavebeencertifiedassustainablebyLeadershipinEnergyandEnvironmentalDesign(LEED),aleadinggreenbuildingratingsystem.Readmoreaboutourenvironmentalpartnersatwww.shell.com/sustainability/our-approach/environmental-and-community-partners.MoreinthisreportSustainabilityatShellProtectingbiodiversitySocialinvestmentMoreonShellwebsitesWorkinginpartnershipProtectingbiodiversityPOWERINGPROGRESSOurambitionistohaveapositiveimpactonbiodiversity.Ournewprojectsinareasrichinbiodiversity–criticalhabitats–willhaveanetpositiveimpactonbiodiversity,startingimplementationin2021.Ournature-basedsolutionprojects,whichprotect,transformorrestoreland,willhaveanetpositiveimpactonbiodiversity,startingimplementationin2021.Wewillreplantforests,achievingnet-zerodeforestationfromnewactivities,whilemaintainingbiodiversityandconservationvalue,startingimplementationin2022.OurapproachOurambitiontohaveapositiveimpactonbiodiversitybuildsonourearliercommitmentnottoexploreforordevelopoilandgasresourcesinnaturalandmixedWorldHeritageSites.Wecontinuetodevelopnewwaystomeasurehowweareimprovingbiodiversity.Thesearebeingincorporatedintoourprocessesandsystems,includingthosefornature-basedsolutionsandreforestation.Weareworkingwithexternalexperts,suchastheInternationalUnionfortheConservationofNature(IUCN)andEarthwatch,tohelpdevelopanddefineourapproachandthewaywemeasureourprogress.WearealsousingcontemporarytechniquessuchasenvironmentalDNAinoursurveys.Weaimtominimisetheimpactofouronshoreandoffshoreprojectsonbiodiversityandecosystems,whetherlifeonlandorlifebelowwater.Weapplythemitigationhierarchy,adecision-makingframeworkthatinvolvesasequenceoffourkeyactions:avoid,minimise,restoreandoffset.Weassessthepotentialimpactofprojectsonbiodiversityandlocalcommunitiesaspartofourimpactassessmentprocess(seeRespectinghumanrightsandEmbeddingsustainabilityintoouractivities).Allpotentialnewprojectsarescreenedtodetermineiftheyarelocatedinacriticalhabitat.Ifwedecidetoprogressaprojectthatisinacriticalhabitat,wedevelopabiodiversityactionplan.Thissetsoutactionsneededtofollowthemitigationhierarchyand,wherethereisimpact,theactionsneededtoachievenetpositiveimpact.Buildinganetpositiveimpactisachievedovertime,forexample,astreesgroworspeciesmultiply.InAustraliain2022,wepartneredwithMonashUniversityonafour-yearrestorationprogrammeforBrowseIsland.Theprojectaimstoimprovethepopulationandresilienceofseabirds,thehatchlingsurvivalrateofthegreenturtleandthehealthofthereef.In2022,wecontinuedtocollaboratewiththeIUCN,non-governmentalorganisationsandotherenergycompaniestodevelopguidelinesformitigatingtheimpactofsolarandwindprojectsonbiodiversity.Formoreonourenvironmentalstewardshipseewww.shell.com/powering-progress/powering-progress-in-action.39ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroRespectingGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsnaturePoweringlivesCriticalhabitatsAttheendof2022,eightofournewprojects,whichcommencedafterwemadeourPoweringProgresscommitmentsinFebruary2021,werewhollyorpartlylocatedincriticalhabitats.Ofthese,fouralreadyhaveabiodiversityactionplaninplaceorunderwaytoworktowardsanetpositiveimpact.Plansareunderdevelopmentfortheremainingprojects.Nature-basedsolutionsNature-basedsolutionprojectsthatweinvestinfollowtherequirementsoftheClimate,CommunityandBiodiversityStandards(CCB)ortheirequivalent.ThevoluntaryCCBstandardssetoutcriteriaforhavingapositiveimpactonclimatechange,localcommunitiesandbiodiversity.Theprojectsareauditedbyindependentthirdparties.Attheendof2022,ourprojectswerestillinthedevelopmentphase;wecontinuetoworktowardscertification.InAustralia,SelectCarbon,awhollyownedShellcompany,operatesprojectsthatareregisteredunderAustraliancarbonmarketregulations.(SeeCarboncredits,includingnature-basedsolutions).DeforestationDeforestationoccurswhenforestsareconvertedtonon-forestuses.WeusethedefinitionofforestusedbytheFoodandAgricultureOrganizationoftheUnitedNations.In2022,around145hectaresweredeforestedasaresultofournewactivities.Weworkwithpartnersandstakeholderstodeveloprobustandcredibleplansuniquetoeachreforestationproject.Readmoreaboutbiodiversityatwww.shell.com/sustainability/environment/biodiversity.MoreinthisreportSustainabilityatShellMoreonShellwebsitesOurstrategy:PoweringProgressBiodiversityCirculareconomyandwasteManagingwastePOWERINGPROGRESSOurambitionistouseresourcesandmaterialsefficientlyandtoincreasereuseandrecycling.Weareaimingforzerowastebyreducingwastegeneratedandincreasingreuseandrecyclinginourbusinessesandsupplychains.Weaimedtosetgoalsforwastereduction,reuseandrecyclingbytheendof2022.Attheendof2022,wehadcompleted24wasteassessmentsatmajorproductionfacilitiesacrossShellinordertoidentifythelargestwastestreams,sharelearningsanddevelopplanstoreducethequantityofwastedisposed.Weaimtodothisbyreducingwastegenerationandincreasingreuse,recyclingandrecovery.Aswecontinuetodeveloptheseplans,wewillupdateourgoalsforwastereduction,reuseandrecycling.WastedisposalThousandtonnes3,0001,500013141516171819202122Non-hazardousHazardous40ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroRespectingGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsnaturePoweringlivesIn2022,wedisposedof1,982thousandtonnesofhazardousandnon-hazardouswaste,whichisrelativelyflatcomparedwith1,993thousandtonnesin2021.Wealsosent457thousandtonnesofresidualmaterialsforreuse,recyclingorbeneficialuseasarawmaterialinanotherprocess.Forexample,wastethatmightotherwisegotolandfillcanbeincineratedtogenerateenergy.Findoutmoreaboutwasteandourcirculareconomyapproachatwww.shell.com/sustainability/environment/circular-economy-and-waste.MoreinthisreportSustainabilityatShellOurapproachtorespectingnatureMoreonShellwebsitesOurstrategy:PoweringProgressCirculareconomyandwastePlasticsPOWERINGPROGRESSWewillworkwithoursuppliersandcontractorstohelpendplasticwasteintheenvironment:By2030,wewillincreasetheamountofrecycledplasticinShell-brandedpackagingto30%andensurethatthepackagingweuseforourproductsisreusableorrecyclable.Wewillincreasetheamountofrecycledmaterialsusedtomakeourproducts,startingwithplastics.Shellsupportstheneedforimprovedcircularityofglobalplasticsmarketsandencouragesreduction,reuseandrecyclingofplastics.WeareafoundingmemberoftheAlliancetoEndPlasticWaste,whichhelpsgovernmentstoassessandimprovewastecollectionandwastemanagement.In2021,wesetacommitmenttoworkwithoursuppliersandcontractorstohelpendplasticwasteintheenvironment.Duetomarketfactors,suchaslackofavailablefeedstockandprogressintechnologydevelopment,Shell’sabilitytoprofitablymeetits1milliontonneplasticwasteambitionby2025isunfeasible.Consequently,weexpecttoprovidefurtherinsightslaterin2023.Reducing,reusingandrecyclingourpackagingWecontinuetoexplorewaystoreduce,reuseandrecyclepackagingacrossoursupplychainsandintroducesustainablepackaging.In2022,morethan30%ofShell-ownedservicestationshadeliminatedunnecessarysingle-useplasticincludingcutlery,strawsandstirrers;andalmost40%hadcompletelyremovedsingle-useplasticbags.InChinaandNorthAmerica,ourbag-in-boxlubricantsuse89%lessplasticthan1-litreplasticbottles;andinEurope,aroundtwo-thirdsofthepackagingusedforourShellCarCareproducts(screenwash,wax,shampoo,coolantandothers)isrecyclable.RecyclingplasticwasteaschemicalfeedstockWearefocusingonchemicalrecyclingwherewebreakdownhard-to-recycleplasticsintorawmaterialsthroughatechniquecalledpyrolysis.Thepyrolysisoilcanthenbeusedasfeedstockinourchemicalplants,replacingtraditionalhydrocarbonfeedstock.Thiscontributestoourcirculareconomyambitionandpreventswastethatwouldotherwisehavegonetolandfillorincineration.In2022,weannouncedplanstobuildanewpyrolysisoilupgraderattheShellChemicalsParkMoerdijkintheNetherlands.Theplant,whichisexpectedtostartoperatingin2024,willhavethecapacitytoproduceupto50,000tonnesofpyrolysisoilperyear.Wearealsobuildingapyrolysisoilupgrader,withaproductioncapacityof50,000tonnesperyear,atourShellEnergyandChemicalsParkSingapore.Alongwithourjoint-venturepartnerBlueAlp,wearebuildingtwohard-to-recycleplasticwasteconversionunitsintheNetherlands,whicharedesignedtoconvertmorethan30,000tonnesofplasticwasteayearintopyrolysisoil.Allthreefacilitiesareexpectedtostartproductionin2024.ShellcompaniesalsohavepyrolysisoilagreementswithcompaniesinEurope,SingaporeandtheUSA.FindoutmoreabouthowwetransformplasticwasteintochemicalfeedstockatChemicalrecycling:tacklingplasticwasteShellGlobal.Discovermoreaboutwasteandourcirculareconomyapproachatwww.shell.com/sustainability/environment/circular-economy-and-waste.MoreinthisreportSustainabilityatShellProductstewardshipDrivinginnovationMoreonShellwebsitesOurstrategy:PoweringProgressPlasticwaste41ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroRespectingGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsnaturePoweringlivesConservingwaterresourcesPOWERINGPROGRESSOurambitionistoconservefreshwaterbyreducingconsumptionandincreasingreuseandrecycling.Wewillreducetheamountoffreshwaterconsumedinourfacilities,startingbyreducingfresh-waterconsumptionby15%by2025,comparedwith2018levels,inareaswherethereishighpressureonfresh-waterresources.Wearemakingsteadyprogressinreducingourfresh-waterconsumptioninwater-stressedareas.Attheendof2022,fourofourmajorfacilitieswerelocatedinareaswherethereisahighlevelofwaterstressbasedonanalysisusingwaterstresstools,includingtheWorldResourcesInstitute’sAqueductWaterRiskAtlasandlocalassessments.Thefacilitiesare:thePearlGTL(gas-to-liquids)plantinQatar,theShellEnergyandChemicalsParkSingapore,theShellJurongIslandchemicalplantinSingaporeandtheTabangaoImportTerminalinthePhilippines.In2022,thesefourfacilitiesconsumed18millioncubicmetresoffreshwater,comparedwith22millioncubicmetresin2021andour2018baselineof25millioncubicmetres.ThisreductionwasmainlytheresultofdecreasedwateruseattheShellEnergyandChemicalsParkSingapore,followingthedecommissioningofsomeprocessingunits,andtheconversionoftheTabangaorefineryinthePhilippinestoaterminal.Freshwaterwithdrawnandconsumed[A]Millioncubicmetres25020015010013141516171819202122FreshwaterwithdrawnFreshwaterconsumed[A]Freshwaterfiguresdonotincludeonce-throughcoolingwater.In2022,ouroverallintakeoffreshwaterdecreasedto156millioncubicmetres,comparedwith166millioncubicmetresin2021.ThisreductionwasmainlytheresultofdivestmentsandtheshutdownofsomeunitsattheShellEnergyandChemicalsParkSingaporeandJurongIslandSingapore.Around85%ofourfresh-waterintakein2022wasusedformanufacturingoilproductsandchemicals,withtherestmainlyusedforoilandgasproduction.In2022,wecontinuedtoreviewourwateruseandstewardship.Weareapplyingproceduresacrossourbusinessestoimprovewaterefficiencyandreducefresh-wateruse.ThishasinvolveddetailedwatercircularityassessmentsatsixShellsitesinAustralia,Germany,India,MalaysiaandtheNetherlands.Theassessmentstaughtusthatwaterstewardshipprinciplescanbeappliedatouronshorefacilities.Weexpecttoupdateourapproachin2023.42ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroRespectingGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsnaturePoweringlivesFreshwaterwithdrawnbybusinessMillioncubicmetres200d233315023151134100c185182177159445091620212022b644630a111182017201820192020aUpstreamcDownstreambIntegratedGasdOtherFreshwaterwithdrawnbysourcePercentage31%aSurfaceca54%bGroundcPublicutilitiesb15%Ofourfresh-waterintakein2022,31%wasfrompublicutilities,suchasmunicipalwatersupplies.Therestwastakenfromsurfacewater,suchasriversandlakes(54%)andgroundwater(around15%).WastewaterandproducedwaterWetracklow-levelconcentrationsofoil,greaseandotherhydrocarbonsinwaterreturnedtotheenvironmentfromtheday-to-dayrunningofourfacilities(referredtoas“dischargestosurfacewater”).Weworktominimisethesedischargesaccordingtolocalregulatoryrequirementsandourownstandards.Wherepossible,welookforwaystotreatwaterfromouroperationsusingnaturalsolutions,suchasconstructedwetlands.In2022,thecombinedtotalofhydrocarbonsdischargedtosurfacewateracrossallourfacilitiesdecreasedto0.9thousandtonnes,comparedwith1.0thousandtonnesin2021.MostofthereductionwastheresultofshutdownsofsomeunitsattheShellEnergyandChemicalsParkSingaporeandshutdownsorimprovingwaterqualityissuesatoffshoreproductionplatformsintheUKandtheUSGulfofMexico.In2022,wedisposedof58millioncubicmetresofproducedwater,whichrepresentsadecreaseof28%from81millioncubicmetresin2021.ThisreductionwasmainlyduetothedivestmentofPermianassetsintheUSAandtheshutdownoffacilities,includingoffshoreproductionplatformsintheUK.Findoutmoreaboutwateruseatwww.shell.com/sustainability/environment/water.MoreinthisreportSustainabilityatShellOurapproachtorespectingnatureMoreonShellwebsitesOurstrategy:PoweringProgressWater43ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroRespectingGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsnaturePoweringlivesAirqualityPOWERINGPROGRESSWearehelpingtoimproveairqualitybyreducingemissionsfromouroperationsandprovidingcleanerwaystopowertransportandindustry.CleanertransportoptionsWearedevelopingarangeoflower-emissionchoicesforcustomers–fromelectricvehiclechargingpointstohydrogen–tohelppeopleandcompaniesuselower-emissionmodesoftransport.Forheavy-dutyroadtransport,weofferliquefiednaturalgasasafuelandgas-to-liquidsproducts,whichhelpreducesulphuremissions,particulatesandnitrogenoxidecomparedwithoil-basedproducts.Sulphuroxide,nitrogenoxideandvolatileorganiccompoundemissionsWefollowourownstandardsandthoseoflocalregulatorstomanageairbornepollutantsinouroilandgasproductionandprocessing,includingemissionsofnitrogenoxides,sulphuroxidesandvolatileorganiccompounds.Oursulphuroxide(SOx)emissionsin2022increasedto36thousandtonnes,comparedwith32thousandtonnesin2021.Theincreasewasmainlybecauseofturnarounds(restartingproductionafterscheduledserviceshutdowns)attheShellEnergyandChemicalsParkSingaporeandSarniarefineryinCanada.Ournitrogenoxide(NOx)emissionsdecreasedfrom105thousandtonnesin2021to93thousandtonnesin2022,becauseof,inpart,thehandoverofoperationsinOML11inNigeria,thedivestmentofPermianassetsintheUSAandfewershipsoperatedbyShell.Ouremissionsofvolatileorganiccompoundsdecreasedto38thousandtonnesin2022from45thousandtonnesin2021.Thereductionswere,inpart,duetothedivestmentofPermianassetsintheUSA,theshutdownoftheTransNigerPipelineandhandoverofoperationsinOML11inNigeria,andreducedflaringinupstreamassetsintheUK.Tofindoutmoreaboutairquality,visitwww.shell.com/sustainability/environment/air-quality.AcidgasesandvolatileorganiccompoundsThousandtonnes150120906030013141516171819202122Sulphuroxides(SOx)Nitrogenoxides(NOx)Volatileorganiccompounds(VOCs)MoreinthisreportSustainabilityatShellOurapproachtorespectingnatureMoreonShellwebsitesOurstrategy:PoweringProgressMethaneemissionsGreenhousegasemissionsReducingmethaneemissionsinshaleoilandgasAirquality44ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesPoweringlivesOurPoweringProgressstrategymeansimprovingpeople'slivesthroughourproductsandactivities,contributingtolocalcommunitiesandchampioninginclusion.46Ourapproachtopoweringlives46Costoflivingcrisis46Providingaccesstoenergy47Workingwithoursuppliers49Contributingtocommunities52Diversity,equityandinclusion53Workerwelfare54Respectinghumanrights55Managingourimpactonpeople45ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesOurapproachtopoweringlivesShellisdedicatedtomakingapositiveimpactonpeoplearoundtheworld,andPoweringLivesexplainshowwedothat.People’slivesarebetterwithenergy.Itprovidesthingslikewarmthandlight,cookedfoodandtransport.Wedeliverthisformillionsofpeoplearoundtheworldeverydayandareworkingtoprovideenergytothosewhodon’tyethaveit.Wealsowanttohelpcommunitiesbenefitfromhavingusastheirneighbour.Wegeneratemillionsofjobs,paybillionsintaxeachyearandsupportstart-ups,localbusinessesandeducationprogrammes.Andwechampionhumanrightsincommunities,companiesandorganisationsweworkwith.Thisincludesactivitiessuchasadvancingworkerwelfareandshapinganinclusiveworldsothateveryonecanbethemselves.MoreinthisreportProvidinglower-carbonelectricityLetterfromtheCEOOurPoweringProgresstargetsMoreonShellwebsitesAccesstoenergyCostoflivingcrisisThecostoffood,energyandothereverydayessentialshasbeenrisingacrosstheworldsince2021,causinghardshipformanypeople.Althoughcombatinginflationistheresponsibilityofgovernment,notcompanies,werealisethatmillionsoffamiliesarestrugglingtomakeendsmeet.Thatiswhyinsomecountries,wherewesupplyelectricityandgastohomes,weareworkingwithgovernmentandsocialpartnerstohelphouseholdsindistresspayorreducetheirenergybills.IntheUK,forinstance,weannounceda£50millionpackagetosupportsomeoftheUK’smostvulnerableenergyconsumers.Thisincludesa£20millionhardshipfundforShellEnergyRetailcustomersthatneedhelptoclearenergydebts,and£150forcustomerswhoalreadyreceiveagovernmenthomeheatinggrantduringthewinter.WealsoprovideShellshopvouchersforfueland/orgroceryitemsforthosemostinneed,andaredonatingmillionsofpoundstoUKcharitiesthatarehelpingthoseatthesharpestendofthecrisis.IntheNetherlands,wearecontributingtoagovernment-backedemergencyfundforpeoplewhocannotpaytheirenergybills.Wearealsoworkingwithseveralenergyrelieforganisationstohelplow-incomehouseholdsandsmallbusinesseslowertheirenergyuse.Globally,weareworkingwithgovernmentstoensurethereisenoughenergytomeetdemandafterRussia’sinvasionofUkraine.Thisincludesdeliveringarecord194cargoesofliquefiednaturalgastoEuropein2022–almostfivetimesourusualaverage–tohelpmaintainsupply,andinvestinginnewnaturalgasproductionandlower-carbonenergies.MoreinthisreportLetterfromtheCEOProvidingaccesstoenergyPOWERINGPROGRESSInlinewithourPoweringProgressstrategy,Shellisstrivingtobringreliableelectricitytopeopleinemergingmarketswhodonotyethaveit.Around775millionpeopleintheworldhavenoelectricity,accordingtotheInternationalEnergyAgency,andmillionsmorehaveunreliablepowersupply.InvestinginenergyaccessShellisstrivingtobringreliableelectricitytopeopleinemergingmarketswhodonotyethaveit.Weareworkingtoimprovethereliabilityofexistingpowersupplytoon-gridcustomersandtoprovidefirstpowertooff-gridcustomersandcommunities.Weareseekingstrategicpartnershipswithgovernments,utilities,developers,banksandinvestorstoaddresslocalchallengesandopportunities,andprogresstowardsachievingourambitiontopoweremergingmarkets.46ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesIn2022,weacquiredDaystarPower,aproviderofsolarpowertobusinessesinWestAfrica.TheinvestmenthelpsexpandourenergybusinessintodevelopingmarketslikethoseinAfricawheremorelower-carbonelectricityisneeded.Readmoreaboutourcommercialenergyaccessbusinessatwww.shell.com/emerging-markets-power.SocialprogrammesSeparatetoourcommercialambition,weinvestinsocialprogrammesthatbenefitcommunitieswherewework.Throughthesevoluntaryinitiatives,weworkwithpartnerorganisationstohelpindividualsandcommunitiesaccessreliableelectricity.In2022,wecontinuedtodevelopprogrammestoimproveaccesstoenergyinEthiopia,Mozambique,Nigeria,PakistanandSouthAfrica.Readmoreabouthowoursocialinvestmentprogrammeshelptoincreaseaccesstoenergyatwww.shell.com/sustainability/communities/access-to-energy.MoreinthisreportProvidinglower-carbonelectricityLetterfromtheCEOOurPoweringProgresstargetsMoreonShellwebsitesBuildinganenergyaccessbusinessAccesstoenergyWorkingwithoursuppliersSupplychainPOWERINGPROGRESSSupplychain:Wewillincluderequirementsinourpurchasingpoliciestoreflectourenvironmentalframework,andtaketheenergyefficiency,materialefficiencyandsustainabilityofproductsintoconsiderationinourpurchases.Shellaimstoworkwithsuppliers,includingcontractors,thatbehaveinaneconomically,environmentallyandsociallyresponsiblemanner,assetoutinourShellGeneralBusinessPrinciplesandShellSupplierPrinciples.In2022,wespentaround$41.5billionongoodsandservicesfromaround24,000suppliersglobally.Wecontinuallyworkwithoursupplierstofindwaystoreducegreenhousegasemissionsacrossoursupplychains.In2021,werolledoutanewdigitalplatform,ShellSupplierEnergyTransitionHub,freeofchargetooursupplychainandanyotherinterestedcompany.Theplatformenablesthemtosetemissionambitionsandtrackperformance,sharebestpracticeandexchangeemissionsdatawiththeirownsupplychains.Bytheendof2022,1,039ofoursuppliershadjoinedtheplatform,460ofwhichhavealreadysetemissionreductiontargets.Thisismorethanafourfoldincreaseon2021inbothinstances.Readmoreabouthowweworkwithcontractorsandsuppliersatwww.shell.com/business-customers/shell-for-suppliers.MoreinthisreportRespectinghumanrightsPreparingforemergenciesEnergytransitionMoreonShellwebsitesOurstrategy:PoweringProgressShellforsuppliersSupplierPrinciples47ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesLocalcontentWewanttomakeapositivedifferencetocountriesandlocalcommunitieswhereweoperate.Wedothisbycreatingjobs,trainingpeople,supportinglocalbusinessesandbuyinggoodsandservicesfromlocalsuppliers–collectivelyreferredtoaslocalcontent.Shelllocalcontentactivitiesin202261%$41.5billionspentinCanada,Germany,theNetherlands,spentgloballyongoodsandservicestheUKandtheUSA$5billion89.8%spentincountrieswheregrossnationalspentintheselow-incomecountrieswithlocalincomeislessthan$15,000ayearpersuppliersperson[A][A]AccordingtotheUNDevelopmentProgramme'sHumanDevelopmentIndex2021.In2022,83.3%ofthe$41.5billionwespentongoodsandserviceswaspurchasedfromsuppliersbasedinthesamecountryofoperation,alsocalledlocalprocurement.About61%ofourprocurementwasinCanada,Germany,theNetherlands,theUKandtheUSA,ofwhich81.9%wasspentwithlocalsuppliersinthesecountries.Weestimatethataround$5billionwasspentincountriesthat,accordingtotheUNDevelopmentProgramme’sHumanDevelopmentIndex2021,haveagrossnationalincomeoflessthan$15,000ayearperperson.Inthesecountries,Shellcompaniesspentaround89.8%,orabout$4.6billion,withlocalsuppliers.In2022,weinitiatedandcompletedalocalcontentmeasurementandreportingprojectwithIpieca,theglobaloilandgasindustryassociation,thatprovidesguidanceforoperators,contractorsandgovernmentsonhowtobestmeasuretheimpactsandoutcomesoflocalcontentpractices.Theguidelineswillberolledoutthroughouttheindustryin2023.Wehavealsodevelopedanewself-assessmentguidethatenablesustoemploybestlocalcontentpracticethroughoutthedurationofnewprojects.Webeganapplyingtheguidein2022ontheHollandHydrogenIprojectintheNetherlands,whichwillbeEurope’slargestrenewablehydrogenplantwhenproductionstartsin2025.DiscovermoreabouthowweworktosupportthecountriesinwhichweoperateintheCommunityskillsandentrepreneurshipsectionandatwww.shell.com/sustainability/communities/local-employment-and-enterprise.MoreinthisreportRespectinghumanrightsPreparingforemergenciesMoreonShellwebsitesOurstrategy:PoweringProgressShellforsuppliersSupplierPrinciples48ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesContributingtocommunitiesSocialinvestmentOuractivitiescontributetoeconomiesthroughtaxes,jobsandbusinessopportunities.Wealsomakesocialinvestmentsinareasdeterminedbylocalcommunityneedsandpriorities.Theseinvestmentsaresometimesvoluntary,sometimesrequiredbygovernments,orpartofacontractualagreement.In2022,wespentalmost$260milliononsocialinvestment,ofwhich30%wasrequiredbygovernmentregulationsorcontractualagreements.Wespenttheremaining$182million(70%)onvoluntarysocialinvestment.Socialinvestment–bythemePercentage2%2%6%1%1%6%33%aDisasterreliefbRequiredsocialinvestmentfghijcEducation7%eadCommunityskillsanddenterprisedevelopmentceEnergyaccessfCommunitydevelopment12%bgOtherhHealthiBiodiversityjRoadsafety30%Around$92millionofourtotalsocialinvestmentspendin2022wasincountriesthat,accordingtotheUNDevelopmentProgramme’sHumanDevelopmentIndex2021,haveagrossnationalincomeoflessthan$15,000ayearperperson.Socialinvestment–byregionPercentage2%33%g32%aAfricafabMiddleEastandNorthAfricacUSAandCanadaebdAsia-PacificeEuropeandCISdcfGlobalgLatinAmerica7%6%13%7%Findoutmoreaboutoursocialinvestmentatwww.shell.com/sustainability/communities.MoreinthisreportProvidingaccesstoenergyCommunityskillsandentrepreneurshipMoreonShellwebsitesOurstrategy:PoweringProgressPeopleandcommunitiesWorkingwithcommunitiesGeneratingprosperityforcountriesandcommunitiesCommunityskillsandentrepreneurshipOurcommunityskillsandentrepreneurshipprogrammesbenefitlocalcommunitieswhereweoperatebycreatingemploymentopportunitiesandcontributingtoeconomicdevelopment,whileaddingvaluetooursupplychain.In2022,around32,000peopleparticipatedin,andmorethan4,000businessesweresupportedby,ourskillsdevelopmentprogrammes,whichhelpedmorethan2,300peoplegainemploymentand/orimprovetheirlivelihoodsafterthetraining.Shellhastwoglobalentrepreneurshipprogrammes–ShellLiveWIREandShellStartUpEngine.49ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesShellLiveWIREhelpsentrepreneursin20countriesstartand/orgrowtheirbusinesses.In2022,ShellLiveWIREtrainedabout2,685peoplearoundtheworldandhelpedcreatemorethan2,170jobs.Theprogrammesupported892existingbusinessesandsome145newbusinesses,with123ShellLiveWIRE-supportedbusinessesenteringoursupplychainin2022.Theprogrammecelebratedits40thanniversaryin2022.ShellStartUpEngineisaglobalinnovationprogrammeforentrepreneursintheenergyindustry.Itsupportsearly-stagestart-upsinareassuchasrenewables,energystorage,smartgridsandelectricmobility.In2022,theprogrammesupported39start-upsinBrazil,France,theNetherlands(asNewEnergyChallenge),Singapore,theUAEandtheUK.WealsocollaboratedwithMicrosoftandAVLtodelivertheShellStartUpEngineSocialImpactProgramme,whichsupported11mobility-relatedstart-upsacrossEurope.FindoutmoreaboutcommunityskillsandentrepreneurshipintheLocalcontentsectionandatwww.shell.com/sustainability/communities/local-employment-and-enterprise.MoreinthisreportSocialinvestmentProvidingaccesstoenergyMoreonShellwebsitesOurstrategy:PoweringProgressSupportingenterprisedevelopmentandentrepreneursLocalemploymentandenterpriseBuyinglocallyandencouraginglocalsuppliersAjusttransitionShellsupportstheParisAgreementonclimatechange,whichrecognisestheimportanceofajusttransition.Ajusttransitionmeansafairerdistributionofthecostsandbenefitsoftheworld’stransitiontoanet-zeroemissionsenergysystem.Ourambitionistocontributetoajusttransitionbymakingapositiveimpactonourworkforce,thecommunitieswhereweoperateandourcustomers.Thisispartofourstrategicgoalofpoweringlives.In2022,ShellUKpledged£100milliontohelpcommunitiesintheUKdevelopskillsandfindjobslinkedtotheenergytransition.Thisincludesestablishingeducationalskillcentreswiththeaimofhelping15,000peoplefindemploymentby2030.Wecontinuetohelpourownstafflearnnewskillsneededfortheenergytransition.In2022,around4,000Shellemployees–upfrom1,700in2021–completedcoursesonarangeofsubjects,includinghydrogenproduction,carboncaptureandstorage,andgreenhousegasandenergymanagement.Wecontinuetoworkwithgovernmentsandpartners,suchasEnergyforaJustTransition,facilitatedbyBusinessforSocialResponsibility,andIpieca’sJustTransitionTaskForce.Wealsoremaincommittedtorespectinghumanrights,assetoutintheUnitedNationsUniversalDeclarationofHumanRightsandtheInternationalLabourOrganization'sDeclarationonFundamentalPrinciplesandRightsatWork(seeOurapproachtohumanrights).Youcanreadmoreaboutourapproachatshell.com/justtransition.Educationinscience,technology,engineeringandmathsWeactivelysupportscience,technology,engineeringandmaths(STEM)througharangeofprogrammesinmorethan20countries.NXplorers,ourflagshipSTEMprogramme,aimstohelpyoungpeopledevelopcreativethinkingtobridgetheskillsgap.NXplorersisnowactivein19countries,andengagedmorethan78,000studentsin2022.In2022,weextendedourSTEMprogrammeinIndiatocoverallagegroupsfromgrade7touniversityleveltohelpstudentsgaintheskillsandconfidencetoengageinworldissues.IntheUK,ouryear-longGirlsinEnergycoursetaughtsome300youngwomenaboutenergyandcareeropportunitiesintheenergyindustry.AndinMalaysiaweworkedwiththeMinistryofEducationtomakeourSTEMprogrammeavailabletostudentsacrossthecountry.ReadmoreaboutourcontributiontoSTEMatwww.shell.com/sustainability/communities/education.MoreinthisreportCommunityskillsandentrepreneurshipProvidingaccesstoenergyMoreonShellwebsitesOurstrategy:PoweringProgressEducation50ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesContributingtoNigeria'seconomyShell’sNigerianbusinessessupportthedevelopmentoflocalcommunitiesandcompanies.ThebusinessesinwhichShellhasinterestsemployedmorethan2,500peopledirectlyin2022andprovidedjobsformanyothersinsuppliernetworks.In2022,theShellPetroleumDevelopmentCompanyjointventure(SPDCJV),ShellNigeriaExplorationandProductionCompany(SNEPCo)andShellNigeriaGas(SNG)awardedcontractsworth$1.9billiontoNigerian-registeredcompanies.SocialandeconomiccontributionofShellcompaniesinNigeria2,50097%$1.36billionpeopleemployedbyemployeesinNigeriaroyaltiesandcorporateShell,plusmorethanwhoareNigeriantaxespaidtothe10,000contractorsNigeriangovernmentin2022(SPDC$450millionandSNEPCo$907million)$1.9billion173,500+worthofcontractswerehealth-careprojectsuniversitygrantsawardedtoNigerian-supportedbytheSPDCawardedbytheSPDCregisteredcompanies[A]JVandSNEPCo[B]JVandSNEPCosince2016[A]TheShellPetroleumDevelopmentCompanyofNigeriaLimited(SPDC),whichhasa30%interestintheSPDCjointventure(SPDCJV)andproducesoilandgasintheNigerDelta.[B]TheShellNigeriaExplorationandProductionCompanyLimited(SNEPCo),whichoperatesinthedeepwatersoftheGulfofGuinea.In2022,theSPDCJV,SNEPCoandSNGinvested$5.6millionineducationprogrammes.Morethan3,000secondaryschoolgrants,3,500universitygrantsand990cradle-to-careerscholarshipgrantshavebeenawardedsince2016.In2022,ShellPetroleumDevelopmentCompanyLimited(SPDC)andSNEPCopaid$1.36billioninroyaltiesandcorporatetaxestotheNigeriangovernment(SPDC$450million,SNEPCo$907million).Betweenthem,theSPDCJV,SNEPCoandSNGalsocontributed$34.29millionindirectsocialinvestment.Socialinvestmentwasmainlyinprojectsrelatedtocommunity,health,education,roadsafetyandenterpriseprogrammes.Theseprojectsareoftenimplementedinpartnershipwithlocalauthorities.Inaddition,$56.13millionhasbeenearmarkedtobepaidin2023bytheSPDCJVandSNEPCoforastatutorycontributiontoHostCommunitiesDevelopmentTrusts(HCDTs),whichwillbenefitNigeriancommunities.TheSPDCJVistransitioningfromitsexistingglobalmemorandumofunderstanding(GMoU)agreementstotheHCDTsincompliancewiththePetroleumIndustryActof2021.OutstandingtranchepaymentsduetocommunitiesundertheGMoUagreementswillbetransferredtotheHCDTs.TheSPDCJVhasengagedextensivelywithinitscommunities,withregulatorsandacrosstheindustry,tosupportthistransition.In2021,welaunchedShellEnergyNigeria,whichaimstosupplygasandreliableenergyforpowergenerationandindustrialuseacrossthecountry.In2022,weacquiredDaystarPower,aproviderofsolarpowertobusinessesinWestAfrica.ReadmoreaboutShell’seconomiccontributioninNigeriaatwww.shell.com.ng/nigeria-briefing-notes.MoreinthisreportSpillresponseandpreventioninNigeriaOurapproachtosafetyProvidingaccesstoenergyMoreonShellwebsitesOurstrategy:PoweringProgressShellNigeriaNigeriaBriefingNotesBuyinglocallyandencouraginglocalsuppliers51ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesDiversity,equityandinclusionPOWERINGPROGRESSWearefocusingonremovingbarriersandcreatingequalityofopportunityinfourstrategicpriorityareas:gender;raceandethnicity;lesbian,gay,bisexualandtransgender(LGBT+);anddisabilityinclusionandenABLEment,assetoutinourPoweringLivescommitmentstodiversityandinclusion.Shellisworkingtowardsachieving35%representationofwomeninourseniorleadershippositionsby2025and40%by2030.Weaimtoincreaseracialandethnicrepresentationacrossourworkforcesothatwebetterreflectthecommunitiesinwhichweworkandlive.AtShell,weseektoprovideasafe,caringandinclusiveenvironmentforLGBT+andPWD(peoplewithdisabilities)staffsothattheycanbethemselvesandreachtheirfullpotential.By2030,wewillmakeourglobalnetworkofservicestationsmoreinclusiveandaccessibletocustomerswithphysicaldisabilities.EmployeeengagementanddialogueWewanttomakeShellanattractiveemployer.Weseektodosobyofferingcareerprogressiontools,suchasindividualdevelopmentplans;flexibleworkingoptions;globalminimummaternityleaveof16weeksand,fromJanuary2023,atleast8weekspaidparentalleavefornon-birthingparents;initiativesandprogrammestohelpcreateasupportiveworkingenvironmentforemployeewell-being;andengagementwithemployeesthroughmultipleforumsandchannels.TheShellPeopleSurveyisoneofthekeytoolsweusetomeasureemployeeengagement,motivation,affiliationandcommitmenttoShell.In2022,thesurveyattaineditshighesteverresponserateof87%(up3.4percentagepointsfrom2021).Theaverageemployeeengagementscorerosethreepointsto78outof100.Shellemployeeshaveaccesstoseniorleaders,localemployeeforumsandemployeeresourcegroups.TheShellGlobalHelplineisavailableforemployeestoraiseconcernsordilemmas,anonymouslyiftheywish.Readmoreaboutemployeeengagementinour2022AnnualReport.Diversity,equityandinclusionOurambitionistobecomeoneoftheworld’smostdiverseandinclusiveorganisations,aplacewhereeveryone–includingemployees,customers,partnersandsuppliers–feelsvalued,respectedandhasastrongsenseofbelonging.Thisambitionunderpinsourstrategyandmakesusastrongerorganisation.Wearefocusingonremovingbarriersandcreatingequalityofopportunityinfourstrategicpriorityareas:GenderAttheendof2022,55%ofourBoardofDirectorsand22%ofourExecutiveCommitteewerewomen.Weareworkingtowardsachieving35%womeninourseniorleadershippositionsby2025andatleast40%by2030.Attheendof2022,30.4%ofseniorleadershipwerewomen,upfrom29.5%in2021.In2022,40%ofexperiencedhireswerewomencomparedwith44%in2021.Ourgraduatehireshaveconsistentlybeen48%or49%womensince2019,againstour50%ambition.In2022,49%ofourgraduatehireswerewomen,comparedwith55%in2021.OuroverallrepresentationofwomeninShellwas33%attheendof2022.RaceandethnicityWeaimtoincreaseracialandethnicrepresentationacrossourworkforcesothatwebetterreflect,andsupportequityin,thecommunitieswherewework.WearefocusingontheNetherlands,theUKandtheUSA,asthesearetheShellhubswhereweseethemostsignificantopportunitiesforrepresentationandinclusionofminorityemployees(seeshell.com/deifordetails).Attheendof2022,ShellhadonedirectorfromaminorityethnicgrouponitsBoardofDirectors.Atthetimeofpublicationofthisreport,Shellplc’sBoardhasthreemembersfromaminorityethnicbackground,whichexceedstheUK’sParkerReviewrecommendationofatleastone.Inaddition,oneofourExecutiveCommitteemembersidentifiesasbeingfromaminorityethnicgroup.LGBT+Weareworkingtoadvancelesbian,gay,bisexualandtransgenderplus(LGBT+)inclusionwithinShellandthecommunitieswherewework.Wepromoteequalopportunityandcreateanenvironmentwherepeoplefeelincluded,regardlessofsexualorientation.52ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesWebenchmarkourinitiativesexternally.In2022,wewererecognisedaswelladvancedinLGBT+workplaceinclusionintheWorkplacePrideGlobal2022Benchmark.Wealsoreceiveda100%scorefromtheHumanRightsCampaignCorporateEquality2022Indexandhavebeenawardedtopscoreeveryyearsince2016.DisabilityinclusionandenABLEmentWeaimtocreateaninclusive,psychologicallysafeandaccessibleenvironmentwherepeoplewithdisabilitiescanexcel.WeprovidesupportandmakeadjustmentsforpeoplewithdisabilitiesduringtherecruitmentprocessandthroughouttheircareerswithShell.Thisincludesequalaccesstovaluableeducationalresources,trainingprogrammesandemphasisonpersonalandprofessionaldevelopment.OurGlobalenABLEmentCoalition,madeupofleadersfromourEmployeeResourceGroups,helpstoshapeanddrivetheenABLEmentstrategyacrossShell.Wenowhave15enABLEemployeeresourcegroupsaroundtheworld.Ourworkplaceaccessibilityservicecovers81locationsworldwidetoensurethatallemployeeshaveaccesstoreasonableworkplaceadjustmentssothattheycanworkeffectively.Wearealsoprovidingabetterexperienceforourcustomerswithphysicaldisabilitiesthroughanapp,deliveredbyfuelService,thatallowsanycustomerwithadisabilitytoalertstationsinadvanceandrequestassistance.AsofDecember2022,Shellofferedtheserviceatalmost7,800stationsin10countries.Readmoreaboutdiversity,equityandinclusioninourAnnualReportandatwww.shell.com/DEI.Ourpeoplein2022>7055%93,000countriesandterritorieswomenontheBoardofemployeesatinwhichweoperateDirectorsDecember31,202222%30%33%womenemployeeswomenonthewomeninseniorExecutiveCommitteeleadershippositions266,00010,076332formaltrainingdaysforexperiencedpeoplegraduatehiresjoinedemployees,jointventurejoinedShell(40%Shell(49%women,partnersandwomen,60%men)51%men)contractorsMoreinthisreportRespectinghumanrightsEthicalleadershipOurPoweringProgresstargetsMoreonShellwebsitesOurstrategy:PoweringProgressContributingtoadiverse,equitableandinclusiveworldShellUKDiversityPayGapReport2022WorkerwelfareOurapproachisinformedbythe10BuildingResponsiblyWorkerWelfarePrinciples.Wealsoworkwithourpartnersandindustrypeerstoincludeworkerwelfareinindustrystandards,guidanceandbestpractice.Thishelpsraiseexpectationsandlevelsofconsistencyacrosstheindustry.In2022,wecontinuedtotakestepstoimproveourapproachtoworkerwelfare.Weco-createdaworkerwelfareworkstreamwithintheIpiecasupplychainworkinggrouptoimproveworkerwelfareinourindustry.Ourseniorleadershipconductedsitevisitsinmultiplecountriestoencourageworkerstospeakfreelyandtoprovideremediesandcreateacultureoftrustandcare.InMalaysia,forexample,wevisited17onshoreandoffshoresitesin2022andconductedananonymoussurveyofhowourlogisticsandsupplycrewsexperiencetheirworkingconditions.Wereceivedmorethan300responses.Thisresulted,amongotherthings,inimprovedlivingquartersforashippingcrewbythevesseloperator.Wealsocontinuedtoworkactivelywithournon-operatedventuresandcontractorstohelpimproveworkerwelfareandlabourrightsacrosstheenergyindustry.InChina,forinstance,thefabricationyardconstructingproductionmodulesforLNGCanada(Shellinterest40%)achieved53ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlives20millionworkinghourswithoutsafetyincident.ThecontractorworkedwithShelltoadopttheBuildingResponsiblyprinciples,whichhasmadeadifferenceinworkerwell-being.Oureffortstoimproveworkerwelfareareundercontinuousdevelopment.Weknowthataswedriveforhigherstandardsandconsistency,wemayidentifysituationswhereourexpectationsarenotmet.Ouraimistobetransparentaboutourprogressaswellasthechallengeswefaceinouroperationsandsupplychain.Readmoreaboutworkerwelfareatwww.shell.com/sustainability/communities/worker-welfare.MoreinthisreportWorkingwithoursuppliersDiversity,equityandinclusionOurPoweringProgresstargetsMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsHumanrightsRespectinghumanrightsOurapproachtohumanrightsHumanrightsarefundamentaltoShell’scorevaluesofhonesty,integrityandrespectforpeople.RespectforhumanrightsisembeddedintheShellGeneralBusinessPrinciplesandourCodeofConduct.OurapproachisinformedbytheUNGuidingPrinciplesonBusinessandHumanRights.WeworkcloselywithothercompaniesandorganisationstoimprovehowweapplytheseUNguidingprinciples.Wefocusonfourpriorityareaswhererespectforhumanrightsiscriticaltohowweoperate:communities,security,labourrightsandsupplychains.In2021and2022,wereviewedoursalienthumanrightsissueswiththesupportofBusinessforSocialResponsibility(salienthumanrightsarethosethataremostatriskfromouroperations).Weassessedpotentialimpactsonthehumanrightsofourstakeholdersaccordingtotheirpotentialseverity,followingthewidelyusedcriteriaofscale,scopeandirremediability.Theresultinglistofoursalientissuesisgroupedintofourfocusareas:labourrights,supplychains,communitiesandsecurity.Foreachoftheseareas,wehavesystemstoidentifypotentialimpactsandtoavoidandmitigatethem.Forexample,Shell’sHSSE&SPControlFrameworkcontainsrequirementsthatsetouthowweidentify,assessandmanageourimpactsoncommunitieswhereweoperate,includinganyimpactonhumanrights.TheShellSupplierPrinciplesoutlinehowweexpectourcontractorsandsupplierstorespectthehumanrightsoftheirworkforce,andtomanagethesocialimpactsoftheiractivitiesonShell’sneighbouringcommunities.Whenprocuringsolarpanelsandmodulesforourprojects,forexample,weengageextensivelywithoursupplierstoensuremaximumtransparencyofoursupplychain.Bytheendof2022,about460Shellstaffhadcompletedthehumanrightstrainingcourselaunchedin2021,whichismandatoryforselectedstaffworkinginhigh-riskfocusareas,suchassocialperformance,humanresourcesandcontractingandprocurement.Weencourageallstafftodothecourse,regardlessoftheirrole,tobuildgreaterunderstandingofhumanrightsacrossShell.ReadmoreaboutourhumanrightspoliciesandfocusareasinourbookletShell'sapproachtohumanrightsandatwww.shell.com/human-rights.ModernslaveryShellisopposedtoallformsofmodernslavery.SuchexploitationisagainstourcommitmenttorespecthumanrightsassetoutintheUNUniversalDeclarationofHumanRightsandtheInternationalLabourOrganization’sDeclarationonFundamentalPrinciplesandRightsatWork.OurapproachisinformedbytheUNGuidingPrinciplesonBusinessandHumanRights.ReadmoreaboutourapproachinourstatementundertheUKModernSlaveryActatwww.shell.com/uk-modern-slavery-act.ReadShellAustralia’sJointModernSlaveryStatement,preparedunderAustralia’sModernSlaveryAct2018,atwww.shell.com.au/sustainability/reporting.54ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesSecuritypracticesWeworktomaintainthesafety,securityandhumanrightsofouremployees,contractstaffandlocalcommunities.ShellGroupcompanieshaveimplementedtheVoluntaryPrinciplesonSecurityandHumanRights(VPSHR)sincetheirdevelopmentin2000.WeincorporatetheVPSHRintoourcoresecurity-relatedprocessesandcontracts.Wecarryoutannualriskassessmentsanddevelopimplementationplanstomanagetheidentifiedrisks.Aspartoftheseplans,wecarryouttrainingandawarenessbriefingswiththesecurityforcesthatwerelyoninourimplementationcountries.WealsoscreenprivatesecurityprovidersonVPSHRandmonitortheirperformanceagainstarangeofcriteria.Readmoreaboutourapproachtohumanrightsandsecurityatwww.shell.com/sustainability/transparency/human-rightsandmoreaboutourimplementationoftheVPSHRatwww.shell.com/vpshr.MoreinthisreportWorkingwithoursuppliersDiversity,equityandinclusionOurPoweringProgresstargetsMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsHumanrightsManagingourimpactonpeopleEngagingwithcommunitiesEngagingwithcommunitiesispartofourapproachtomanaginghumanrightsandprovidingaccesstoremedy.Shell’sHSSE&SPControlFrameworkhelpstoensurethatweoperateresponsiblyandavoidorminimisethenegativesocialimpactsofouroperations.Therequirementssetoutintheframeworkalsohelpustomaximisebenefitsarisingfromourpresence,suchaslocalemploymentandcontractualopportunities.Weuseouronlinecommunityfeedbacktoolatmanyofoursitestotrackandrespondtoquestions,complaintsandfeedbackthatwereceive.Itallowsournetworkof121communityengagementpractitioners(CEPs)todocumentfeedbackandoutcomes.TheCEPsactasabridgebetweenlocalcommunitiesandourbusinesses.In2022,mostissueswereresolveddirectlybytheCEPs,andtheremainderwereresolvedbysitemanagement.In2022,weincreasedthenumberofsiteswithcommunityfeedbackmechanismsalignedwiththeeffectivenesscriteriaoftheUNGuidingPrinciplesto16.Severalmoresiteshavedifferentproceduresinplace.Wereceivedfeedbackfrom108sitesin30countriesin2022.55ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesCommunityfeedbackbytypeComplaintsreceivedgloballybycategoryPercentagePercentage11%4%2%5%1%9%cdef31%adcba29%51%b57%aComplaintsaSocialeHealthbRequestsbEnvironmentfSecuritycQuestionsdPositivefeedbackcBusinessintegrity,contractualandcommercialdSafetyEnvironmentalcomplaintsbysubcategorySocialcomplaintsbysubcategoryPercentagePercentage3%2%1%1%1%16%3%22%11%efghij31%5%a21%agdfecb11%dcb20%27%6%19%aOdourgEcosystemaLandandresettlementeEngagementbNoiseandhabitatbLocalcontentfSocialinvestmentcLightcLabourgImpactdFlaringhSpillsdOthereAirqualityiSoilandwaterfDustcontaminationjOtherReadmoreaboutourworkwithcommunitiesatwww.shell.com/sustainability/communities/working-with-communities.56ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesIndigenousPeoplesOuractivitiescanaffectIndigenousPeopleswhoholdspecificrightsfortheprotectionoftheircultures,traditionalwaysoflifeandspecialconnectionstolandandwater.WeseekthesupportandagreementofIndigenousPeoplespotentiallyaffectedbyouractivitiesthroughdialogue,culturallyappropriategrievancemechanismsandimpactmanagementprocesses.ShellhasapublicpositionstatementonFreePriorandInformedConsent(FPIC),aprinciplerecognisedintheUNDeclarationontheRightsofIndigenousPeoples.Itentailsopendialogue,good-faithnegotiationsand,whereappropriate,thedevelopmentofagreementsthataddresstheneedsofIndigenousPeoples.In2022,wecontinuedtoworkwithIndigenousPeoplesatseveralofourprojects.AtourQGCnaturalgasprojectinAustralia,wearehelpingTraditionalOwnersdevelopacentraliseddatabasethatenablesthemtodocumentandmanagetheirrichculturalheritageandincreaseunderstandingofitsdepthandsensitivities.WealsopartneredwiththeWaalitjFoundationtolaunchascholarshipprogramme,whichinitsfirstyearfunded47scholarshipsforindigenousstudentstopursuetertiarystudiesandvocationaltraining.InIndia,weareworkingwithsmallholderfarmers,includingthoseintribalcommunities,toimplementnature-basedsolutionprojectsthathelptoabsorborpreventthereleaseofgreenhousegases(seeNature-basedsolutions).Theseprojectsalsoaimtohelpfarmersdiversifytheirincomethroughagroforestryandimproveagriculturalproductivitythroughsustainablepractices.MoreinthisreportCommunityskillsandentrepreneurshipRespectinghumanrightsOurPoweringProgresstargetsMoreonShellwebsitesOurstrategy:PoweringProgressWorkingwithcommunitiesCulturalheritagePreservingculturalheritageisanimportantpartofoureffortstomanageoursocialimpact.Culturalheritagereferstoplacesofarchaeological,historical,cultural,artisticandreligioussignificance.Italsoincludesthepreservationofuniqueenvironmentalfeatures,culturalknowledgeandtraditionallifestyles.Ourapproachstartswithconsideringhowtoavoidorminimiseourimpactonculturalheritage.Thiscaninvolvecarryingoutarchaeologicalassessmentstoinform,amongotherthings,projectdesignandsiteselection.Wethendevelopchance-findprocedurestodealwithpreviouslyunknownheritageresourcesthatmaybediscoveredduringconstruction.Wetrainstaffandcontractorstomakethemfullyawareoftheseresourcestogivethemtheauthoritytohaltworkifnecessary.Insomeinstances,oureffortstoprotectculturalheritageinvolvedistinctsocialandculturalgroupsthatshareancestraltiestotheland.InBrazil,wecompletedin2022amulti-yearprojecttohelp21Quilombolacommunitiesrecordandreclaimtheirancestralhistoryandculturalheritageintheirtraditionalterritories.Theselandswereimpactedbythediscoveryofoilandresultantworkermigrationinthe1970sandafter.Readmoreaboutourapproachtoculturalheritageatwww.shell.com/sustainability/communities/working-with-communities.MoreinthisreportCommunityskillsandentrepreneurshipRespectinghumanrightsOurPoweringProgresstargetsMoreonShellwebsitesOurstrategy:PoweringProgressWorkingwithcommunitiesInvoluntaryresettlementWesometimesrequiretemporaryorpermanentaccesstoareasoflandorseawherepeoplearelivingorworking.Weaimtoavoidresettlementwhereverpossible.Whereresettlementisunavoidable,weworkwithlocalcommunitiestohelpthemresettleandmaintain,orimprove,theirstandardoflivinginaccordancewithinternationalstandardsforresettlement(notablytheInternationalFinanceCorporation’sPerformanceStandard5onlandacquisitionandinvoluntaryresettlement).Oursupportmayalsoincludehelpingthesecommunitiestoestablishalternativelivelihoods.Readmoreaboutourapproachtoinvoluntaryresettlementatwww.shell.com/sustainability/communities/working-with-communities.MoreinthisreportCommunityskillsandentrepreneurshipRespectinghumanrightsOurPoweringProgresstargetsMoreonShellwebsitesOurstrategy:PoweringProgressWorkingwithcommunities57ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholderdataOurcorevaluesemissionsRespectingnaturePoweringlivesvalueGeneratingshareholdervalueOurPoweringProgressstrategygeneratesvalueforourshareholders.Itprovidesthefinancialstrengthtotransformourcompanyastheworldmakesthetransitiontocleanerenergy.59Ourbusinessactivities60Producingoilandnaturalgas61Embeddingsustainabilityintoouractivities62Non-operatedventures62Acquisitionsanddivestments58ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholderdataOurcorevaluesemissionsRespectingnaturePoweringlivesvalueOurbusinessactivitiesEnergyuseEnergyuseCustomersectorsMobilityResidentialMarineAviationAgricultureCommercialIndustrialCommercialandforestryroadtransportSUPPORTINGTHEDELIVERYOFINTEGRATEDENERGYSOLUTIONSEnergysolutionsFuelsLubricantsChemicalsBiofuelsElectricityHydrogenNaturalgasGas-to-liquidsValueenhancedbytradingandoptimisationPeopleCarbonoffsetsEnergyandchemicalsparksLNGandGTLTransportPowerBiomassAssetsandcapabilitiesRenewablesOilGasTechnologyandoperationalexcellenceMoreinthisreportOurPoweringProgresstargetsLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissions59ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholderdataOurcorevaluesemissionsRespectingnaturePoweringlivesvalueProducingoilandnaturalgasConventionaloilandgasThemostambitiousscenariosshowthatastheenergysystemtransitions,theworldwillcontinuetoneedoilandgasfordecades.Fromexplorationtorefininganddistribution,traditionalfuelscontinuetoplayakeyroleintheenergysystem.In2022,ourcrudeoilandnaturalgasliquidsproductionavailableforsalewas13%lowerthaninthepreviousyear.Thislargerthanusualdeclinewasmainlydrivenbyportfoliochanges,includingthesaleofourPermianbusinessintheUSAinlate2021andderecognitionofSakhalin-relatedvolumesinRussia.Aswetransformourbusiness,wewillcontinuetodelivertheenergytheworldneedstodayandinthedecadesahead.Atthesametime,weareacceleratingthetransitiontolow-andzero-carbonenergy,whichisattheheartofourstrategy.Readmoreaboutourapproachatwww.shell.com/sustainability/integrating-sustainability-into-our-activities/producing-oil-and-gas-responsibly-and-efficiently.LiquefiednaturalgasAsoneoftheworld’slargestsuppliersofliquefiednaturalgas(LNG),wecanshipnaturalgastowhereitisneeded.Forinstance,in2022wedeliveredarecord194cargoesofLNGtoEurope–almostfivetimesourusualaverage–tohelpreplaceRussiangasandmaintainsupplyforpeopleandbusinesses.LNGalsoplaysanimportantroleinenablingcountriestoreplacecoal-firedpowergenerationwithalesscarbon-intensivealternative.In2022,ourColibriproject(Shellinterest87%)inTrinidadandTobagostartedproduction.ColibrideliversnaturalgasdomesticallyandinternationallythroughAtlanticLNG,oneoftheworld’slargestLNGplants(Shell’sinterestrangesfrom46%to57.5%ineachofthefourtrainsatthefacility).WearealsopartoftheNorthFieldEastandNorthFieldSouthexpansionprojectsinQatar,thelargestLNGprojectever,whichwillsupplymarketsworldwideandincludecarboncaptureandstoragetoreduceemissions.And,wemadefinalinvestmentdecisionstodevelopoffshoregasprojectsintheUKNorthSeaand,withourpartners,inAustraliaandMalaysia.Firstgasisexpectedfromtheseprojectsinthemid-2020s.Readmoreaboutnaturalgasatwww.shell.com/energy-and-innovation/natural-gas.ShaleoilandgasFollowingthedivestmentofourPermianbusinessintheUSAin2021,wehavelimitedinvolvementinshaleoilandgasproduction.WeworktounlockourremainingshaleresourcessafelyandresponsiblythroughstrictadherencetoourOnshoreOperatingPrinciplesforsafety,air,water,footprintandcommunity.Weconductouroperationsinamannerthataimstoprotectairqualityandreduceemissions.Forexample,weareimplementinggreenhousegasabatementprojectsforourfacilities,suchasusingrenewablepowersupplyandenergyefficiencyimprovementinitiatives.Readmoreaboutshaleoilandgasproductionatwww.shell.com/energy-and-innovation/shale-oil-and-gas.ArcticWedonotplantopursuenewoilexplorationleasesoffshoreintheArcticCircle.ShellendedoffshoreexplorationdrillingoperationsinAlaskain2015.WeholdonelicenceinterestintheNorthSlopeareaofAlaska.In2020,wereceivedregulatoryapprovaltocombineournear-shoreleasesinWestHarrisonBayintoasingleunitandwearecurrentlyseekingaco-ownertooperatetheunit.TheNikaitchuqNorthprospect,inwhichShellhelda50%interest,wasrelinquishedbybothShellandENIin2022.InNorway,Shellisa10%partnerinIrpa,anoffshorenaturalgasdiscoverylocatedinanareaofexistinggasproductionwithintheArcticCircle.Irpaisplannedasatie-intotheexistingAastaHansteenplatform(operatedbyEquinor),whichalreadysuppliesnaturalgastotheNyhamnaprocessingplant,whereShellisresponsibleforprovidingsignificantexportsofgastoEurope.WealsoholdseverallicencesfromourpreviousactivitiesintheCanadianArctic,althoughwedonotplantodeveloptheselicences.Shellexitedits50%interestintheGydanenergyventureinRussiain2022.Atthetimeofexit,Gydanhadnoproductionandhadyettomakeacommercialdiscovery.Readmoreaboutourapproachatwww.shell.com/sustainability/integrating-sustainability-into-our-activities/producing-oil-and-gas-responsibly-and-efficiently.MoreinthisreportOurPoweringProgresstargetsLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsIntegratingsustainabilityintoouractivities60ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholderdataOurcorevaluesemissionsRespectingnaturePoweringlivesvalueEmbeddingsustainabilityintoouractivitiesProjectsSafetyandtheimpactofouractivitiesontheenvironmentandcommunitiesarevitalconsiderationswhenweplan,designandoperateourprojectsandfacilities.ThemandatoryrequirementsinourHealth,Safety,Security,EnvironmentandSocialPerformance(HSSE&SP)ControlFrameworkhelptoensureprojectsandfacilitiesaredesignedandconstructedsafely,responsiblyandinaconsistentway.Ataprojectlevel,assessingclimate-relatedrisksisanimportantpartofmakinginitialinvestmentdecisions.Projectsunderdevelopmentthatareexpectedtohaveamaterialgreenhousegasimpactmustmeetourinternalcarbonperformancestandardsorindustrybenchmarks.Thishelpstoensurethatourprojectscancompeteandprosperintheenergytransition.In2022,wetookafinalinvestmentdecisiontostartbuildingEurope’slargestrenewablehydrogenplantintheNetherlands.Onceoperationalin2025,theplantwillproduceupto80tonnesofrenewablehydrogenperdayusingcleanenergyfromanoffshorewindfarmpartlyownedbyShell.ThehydrogenwillsupplytheShellEnergyandChemicalsParkRotterdam.Alsoin2022,wetookafinalinvestmentdecisiontodeveloptheRosmari-Marjoramgasproject(Shellinterest80%),whichliesoffMalaysia’scoast.Theoffshoreproductionplatformwillbepoweredmainlybysolarpanelsandtheonshoregasplantprimarilybyhydroelectricityfromthemainlandpowergrid.Readmoreabouthowweembedsustainabilityintothelifeofaprojectatwww.shell.com/sustainability/embedding-sustainability-into-projects.Readaboutourmajorprojectsatwww.shell.com/about-us/major-projects.DecommissioningandrestorationDecommissioningispartofthenormallifecycleofeveryoilandgasstructure.Weworkhardtocloseanddisposeofinstallationsinasafe,efficient,cost-effectiveandenvironmentallyresponsiblemanner.Thisincludesrestoringthesurroundingsofplatformsandfacilitiesinlinewithrelevantlegislation,whiletakingourownenvironmentalstandardsintoaccount.WehavedecommissioningandrestorationactivitiesunderwayinBrazil,Brunei,India,theNetherlands,theUKandtheUSA.Weseektoreuse,repurposeandrecyclematerialsindecommissioning.Attheendof2022,wereported$20billiononourbalancesheetforcurrentandnon-currentdecommissioningandotherprovisions,whichishowweaccountforfuturedecommissioningexpenses(seeour2022AnnualReport).Shellinvestsininnovativedecommissioningandrestorationtechnologies,bothin-houseandbyfundingthirdparties.Forinstance,ourLocalExpandertechnologyisusedthroughouttheindustrytoplugunusedwellsandstopmethaneandliquidsfromescapingovertime.Theexpanderiseasytodeployandtypicallyreducesgreenhousegasemissionsbyatleasthalfcomparedwiththealternativemethodofplugging.ReadmoreaboutShell’sapproachtodecommissioningatwww.shell.com/sustainability/decommissioning-and-restoration.MoreinthisreportOurPoweringProgresstargetsLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsIntegratingsustainabilityintoouractivities61ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholderdataOurcorevaluesemissionsRespectingnaturePoweringlivesvalueNon-operatedventuresMorethanhalfofShell’sjointventuresarenotoperatedbyShell.Wedonothavedirectcontroloverhowtheseventuresembedsustainabilityintheiroperations,butseekinsteadtoofferoursupportandexertapositiveinfluenceontheiroperations.Weexpectajointventureoperatedbyapartnertoapplystandardsandprocesses,orprinciples,thataremateriallyequivalenttoourown,specificallyour:ShellGeneralBusinessPrinciples;ShellCommitmentandPolicyonHealth,Safety,Security,theEnvironmentandSocialPerformance;andStatementonRiskManagement(oramateriallyequivalentapproachtoriskandinternalcontrol).Aspartofoureffortstoenhancetransparencyandtherobustnessofourmethaneemissionsdatareporting,weheldsessionsin2022withseveraljoint-venturepartnerstodiscusstheimportanceofmethaneemissionsmanagementandthebenefitsoftheOil&GasMethanePartnership(OGMP)2.0reportingframework,ofwhichweareafoundingsignatory.Duringtheyear,wewereawardedGoldStandardstatusforourOGMP2.0reportingforthesecondconsecutiveyear.Formoreinformationabouthowweworkwithourjointventures,seewww.shell.com/sustainability/integrating-sustainability-into-our-activities/working-with-nonoperated-ventures.MoreinthisreportSustainabilityatShellOurstandardsandpoliciesLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsIntegratingsustainabilityintoouractivitiesAcquisitionsanddivestmentsPoweringProgresssetsoutourstrategytoacceleratethetransitionofourbusinesstonet-zeroemissions,purposefullyandprofitably,by2050.Wetakecaretoinvestresponsiblyintheenergytransitionandscreenourinvestmentsagainstmultiplecriteria.Beforeacquiringordivestingabusiness,weassessthecounterparty’sfinancialstrength;operatingculture;policiesgoverninghealth,safety,securityandenvironmentalperformance;ethicsandcompliance;andtheeffectivenessofitssocialperformanceprogrammes.Whererelevant,wealsoshareouremissionreductionplans,includinghowweseektocomplywithregulationsandimplementourcommitments,forthebuyer’sconsiderationastheypreparetotakeoverownership.Readmoreabouthowwedivestatwww.shell.com/sustainability/integrating-sustainability-into-our-activities/divesting-responsibly.MoreinthisreportSustainabilityatShellOurstandardsandpoliciesLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissionsIntegratingsustainabilityintoouractivities62ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataOurperformancedataEachyear,wemeasureourESGperformanceandreportonthesafetyofouroperations,ourimpactontheenvironmentandourcontributiontocommunities.64Aboutourdata65Ourstandardsandpolicies66OurPoweringProgresstargets68Safetydata71Greenhousegasandenergydata78Otherenvironmentaldata82Socialdata63ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataAboutourdataWebeganreportingvoluntarilyonourenvironmental,safetyandsocialperformancewiththefirstShellReportfor1997.Wesupporttransparencyandshareinformationanddatainthisreportandonwww.shell.com.Thereareinherentlimitationstotheaccuracyofenvironmental,safetyandsocialperformancedata.Werecognisethatourdatawillbeaffectedbytheselimitations,sowecontinuetoimprovedataintegritybystrengtheningourinternalcontrols.Weprovideallnon-financialdatainthisreportona100%basisforcompaniesandjointventureswherewearetheoperatorunlessotherwisestated,inlinewithindustrypractice.Webelievethattheoperationalcontrolboundarybestreflectsexistingregulatoryrequirements,aswellasinternalpolicies,forthemanagementofpotentialhealth,safety,environmentalandsocialimpacts.OurScope1and2greenhousegasemissionsarecalculatedusingtwoboundaries:operationalcontrolandequity.Undertheoperationalcontrolboundary,wereport100%ofgreenhousegasemissionsfromtheassetsthatweoperate,regardlessofhowmuchequitywehaveinthoseassets.Undertheequityboundary,wereportthegreenhousegasemissionsthatcorrespondtoourproportionofequityinbothoperatedandnon-operatedassets.Scope1and2greenhousegasemissionsundertheequityboundaryfor2022areexpectedtobepublishedlaterintheyearasanupdatetothisreportandonourcorporatewebsite.Operationsthatweacquiredordivestedduring2022areincludedonlyfortheperiodinwhichweoperatedthoseassets.Werefertothenumberofpeopleemployedonafull-andpart-timebasis.ThisincludespeopleworkinginShellsubsidiaries,Shell-operatedjointventuresandthosesecondedtonon-Shell-operatedjointoperations,orventuresandassociates.Employeemetricsexcludetheemployeesinportfoliocompanies,exceptforthemetricsreflectingtotalemployeenumbers,actualnumberofemployeesbygeography,percentageofwomenemployees,andmandatorytrainingcourses.Otherdataarecollectedfromexternalsources,employeesurveysandotherinternalsourcesasindicated.SomedatainthesocialperformancedatatablecomefromaninternalsurveycompletedbytheseniorShellrepresentativeineachcountry.Theaccuracyofenvironmentalandsocialdatamaybelowerthanthatofdataobtainedthroughourfinancialsystems.Weonlyincludedatainthisreportfor2022thatwereconfirmedbytheendofFebruary2023.Ifincidentsarereclassifiedorconfirmed,orifsignificantdatachangesoccurafterpreparationofthisreport,theywillbeupdatedinthefollowingyear’spublication.AssuranceWehaveclearstandardsandreportingrequirementsforourhealth,safety,security,environmentandsocialperformance(HSSE&SP)data.Shellcompaniesarerequiredtoadoptthesestandards,whichdefinemanagementrolesandresponsibilities,thescopeofdataatfacilitiesandhowdataarecalculatedandcollected.ThesestandardsarepartofourHSSE&SPControlFramework.Toensureweprovideaccurateinformation,ourassuranceprocessforHSSE&SPdataisalsoakeyelementoftheHSSE&SPControlFramework.Someexamplesoftheassurancemechanismsinthisprocessare:self-assessmentsatthefacilitylevel;internalauditsatalllevelsofShell;quarterlyreviewsandassessmentsofthedataatalllevels;anannualseriesofmeetingsbetweenleadersatGrouplevelandseniorbusinessmanagerstodiscussoutcomesandreportingparameters;andformalsign-offbyShell’sseniorcountryleaders.SomeacquiredcompaniesinnewbusinesssectorsarenotyetinfullcompliancewiththeShellControlFramework.Followingspecificassessmentsforeachofthesecompanies,dedicatedprojectswereputinplacetoachievecompliance,withregularupdatesonprogress.TheCarbonReportingCommittee,whichwasformedin2021,istaskedwithensuringthatgreenhousegasemissionmeasures–absoluteemissionsandcarbonintensity,andassociatedmetrics–complywithallregulatoryandlegalrequirements.TheReportReviewPanelofindependentexpertshelpsensureourreportingisbalanced,relevantandresponsivetostakeholderinterests.LRQAhasprovidedlimitedassuranceofournetcarbonintensity(measuredandreportedusingtheNetCarbonFootprintmethodology),Scope1andScope2greenhousegasemissionsdataunderoperationalcontrolfor2022,andScope3greenhousegasemissionsfromenergyproductsincludedinournetcarbonintensity.Limitedassurancemeansnothinghascometotheverifier’sattentionthatwouldindicatethegreenhousegasdataandinformation,aspresentedintheNetCarbonIntensityAssertionandtheGreenhouseGasStatement/Assertion,werenotmateriallycorrect.Themostrecentassurancestatementsareavailableatwww.shell.com/ghg.ConversionsintoUSandCanadiandollarsarebasedontheaverageexchangeratesfor2022.MoreinthisreportOurPoweringProgresstargetsOurstandardsandpoliciesLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissions64ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataOurstandardsandpoliciesSelectedcommitments,policiesandframeworksWehaveanumberofcodes,policiesandassuranceprocessesthatdefinehowweaimtooperateinsociallyandenvironmentallyresponsibleways.Theseinclude:ShellGeneralBusinessPrinciplesShellCodeofConductShellEthicsandComplianceManualShellCodeofEthicsforExecutiveDirectorsandSeniorFinancialOfficersShellSupplierPrinciplesShellHealth,Safety,Security,Environment&SocialPerformanceCommitmentandPolicyShellHealth,Safety,Security,Environment&SocialPerformanceControlFrameworkHealth,Safety,Security,Environment&SocialPerformanceassuranceShell’shumanrightsapproachVoluntaryPrinciplesonSecurityandHumanRightsShell’sambitiontobeanet-zeroemissionsenergybusinessEnvironmentalframeworkBiodiversitycommitmentsPurchasingPolicyStatement:SustainableSourcingofBiocomponentsCorporatepoliticalengagement(PDF)Shell’sprinciplesforproducingtight/shaleoilandgasWealsosupportanumberofexternalvoluntarycodes.ReportingstandardsandframeworksOurreportingisinformedbyanumberofstandardssuchastheIpiecaSustainabilityReportingGuidanceandtheGlobalReportingInitiative(GRI).Inaddition,wemapourdisclosuresagainsttheSustainabilityAccountingStandardsBoard’sOilandGasExplorationandProductionStandard,theWorldEconomicForum’sStakeholderCapitalismMetrics(core)andareafoundingmemberofandasignatorytotheUnitedNationsGlobalCompact.InourAnnualReport,wesetoutourclimate-relatedfinancialdisclosuresconsistentwithalloftheTaskForceonClimate-relatedFinancialDisclosures’RecommendationsandRecommendedDisclosures.Guidancewetakeintoaccountincludes:GlobalReportingInitiativeTaskForceonClimate-relatedFinancialDisclosuresSustainabilityAccountingStandardsBoardCDPIpiecaUnitedNationsGlobalCompactUnitedNationsSustainableDevelopmentGoalsMoreinthisreportOurPoweringProgresstargetsLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissions65ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataOurPoweringProgresstargetsInFebruary2021,ShelllaunchedPoweringProgress,whichsetsoutourstrategytoacceleratethetransitionofourbusinesstonet-zeroemissions,purposefullyandprofitably.Itisdesignedtointegratesustainabilitywithourbusinessstrategy,insupportofourpurpose–topowerprogresstogetherbyprovidingmoreandcleanerenergysolutions.Socio-economic,politicalandmarketfactorssometimesaffectourportfoliochoices.Whilenodecisionshavebeenmade,existingglobalbusinesstargetsarecurrentlyunderreview,aspartofnormalstrategyevolution.WeexpecttoprovidefurtherinsightsduringourCapitalMarketsDayinJune2023.Readmoreinthecautionarynote.SelectedtargetsandcommitmentsunderPoweringProgressinclude:Achievingnet-zeroemissionsWorkingwithourcustomersandacrosssectorstoacceleratethetransitiontonet-zeroemissions.Shell’sclimatetargetistobecomeanet-zeroemissionsenergybusinessby2050.OurtargetsincludereducingourabsoluteScope1and2emissionsby50%by2030comparedto2016levels,onanetbasis,andreducingthecarbonintensityoftheenergyproductswesellby6-8%by2023,9-12%by2024,9-13%by2025,20%by2030,45%by2035and100%by2050.In2022,welinkedthepayofmorethan16,500stafftoourtargettoreducethecarbonintensityofourenergyproductsby9-12%by2024,comparedwith2016.WehavecommittedtoeliminateroutinegasflaringfromourUpstream-operatedassetsby2025.Wehavesetatargettokeepourmethaneemissionsintensityforoperatedoilandgasassets(includingliquefiednaturalgas)below0.2%by2025.RespectingnatureProtectingtheenvironment,reducingwasteandmakingapositivecontributiontobiodiversity.BiodiversityOurambitionistohaveapositiveimpactonbiodiversity.Ournewprojectsinareasrichinbiodiversity–criticalhabitats–willhaveanetpositiveimpactonbiodiversity,startingimplementationin2021.Ournature-basedsolutionprojects,whichprotect,transformorrestoreland,willhaveanetpositiveimpactonbiodiversity,startingimplementationin2021.Wewillreplantforests,achievingnet-zerodeforestationfromnewactivities,whilemaintainingbiodiversityandconservationvalue,startingimplementationin2022.WaterOurambitionistoconservefreshwaterbyreducingconsumptionandincreasingreuseandrecycling.Wewillreducetheamountoffreshwaterconsumedinourfacilities,startingbyreducingfresh-waterconsumptionby15%by2025,comparedwith2018levels,inareaswherethereishighpressureonfresh-waterresources.CirculareconomyandwasteOurambitionistouseresourcesandmaterialsefficientlyandtoincreasereuseandrecycling.Weareaimingforzerowastebyreducingwastegeneratedandincreasingreuseandrecyclinginourbusinessesandsupplychains.Weaimedtosetgoalsforwastereduction,reuseandrecyclingbytheendof2022.Wewillworkwithoursuppliersandcontractorstohelpendplasticwasteintheenvironment:By2030,wewillincreasetheamountofrecycledplasticinShell-brandedpackagingto30%andensurethatthepackagingweuseforourproductsisreusableorrecyclable.Wewillincreasetheamountofrecycledmaterialsusedtomakeourproducts,startingwithplastics.AirqualityWearehelpingtoimproveairqualitybyreducingemissionsfromouroperationsandprovidingcleanerwaystopowertransportandindustry.CollaborationandreportingWearestrengtheningexternalpartnershipsandimprovingtransparencyonperformance.Supplychain:Wewillincluderequirementsinourpurchasingpoliciestoreflectourenvironmentalframework,andtaketheenergyefficiency,materialefficiencyandsustainabilityofproductsintoconsiderationinourpurchases.Externalpartnerships:Wewillensureexternalpartnershipsinformkeyareasofdevelopmentanddeliveryofourambitions.Externalreporting:WewilltransparentlyreportperformanceinourannualSustainabilityReport.66ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataPoweringlivesImprovingpeople'slivesthroughourproductsandactivities,contributingtolocalcommunitiesandchampioninginclusion.InlinewithourPoweringProgressstrategy,Shellisstrivingtobringreliableelectricitytopeopleinemergingmarketswhodonotyethaveit.Shellisworkingtowardsachieving35%representationofwomeninourseniorleadershippositionsby2025and40%by2030.Weaimtoincreaseracialandethnicrepresentationacrossourworkforcesothatwebetterreflectthecommunitiesinwhichweworkandlive.AtShell,weseektoprovideasafe,caringandinclusiveenvironmentforLGBT+andPWD(peoplewithdisabilities)staffsothattheycanbethemselvesandreachtheirfullpotential.By2030,wewillmakeourglobalnetworkofservicestationsmoreinclusiveandaccessibletocustomerswithphysicaldisabilities.MoreinthisreportSustainabilityatShellOurjourneytoachievingnetzeroLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissions67ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataSafetyperformancedataPersonalsafety[A]Unit20222021202020192018IpiecaSASBGRIFatalities[B]Number28072SHS-3EM-EP-320a.1403-9Employees00030SHS-3EM-EP-320a.1403-9ContractorsNumber28042SHS-3EM-EP-320a.1403-9FatalaccidentrateNumber0.41.70.01.40.4SHS-3EM-EP-320a.1403-9EmployeesNumberper1000.00.00.01.60.0SHS-3EM-EP-320a.1403-9millionhoursContractors0.72.90.01.20.6SHS-3EM-EP-320a.1403-9Seriousinjury,illnessandfatality(SIF)[C][D]Numberper1008322335––––Employeesmillionhours055–––Contractors827189––––Seriousinjury,illnessandfatalityNumberper10026–frequency(SIF-F)[C][D]millionhours1.76.96.07.5––––EmployeesNumber0.02.72.74.9––––ContractorsNumber2.89.86.87.8––––Totalrecordablecasefrequency(TRCF)Number1.00.90.70.90.9SHS-3EM-EP-320a.1403-9EmployeesNumberper100millionhours0.70.50.40.60.7SHS-3EM-EP-320a.1403-9ContractorsNumberper1001.11.10.91.11.0SHS-3EM-EP-320a.1403-9Losttimeinjuryfrequency(LTIF)millionhours0.40.30.20.30.3SHS-3EM-EP-320a.1403-9EmployeesNumberper100millionhours0.40.30.20.30.2SHS-3EM-EP-320a.1403-9ContractorsNumberpermillion0.40.40.30.30.3SHS-3EM-EP-320a.1403-9hoursNumberpermillionhoursNumberpermillionhoursNumberpermillionhoursNumberpermillionhoursNumberpermillionhours[A]Inlinewithindustrystandards,wedistinguishthreecontractmodes.Mode1:contractor/supplierperformsworkunderShell’sHSSEManagementSystem(HSSEMS);Mode2:contractor/supplierperformsworkunderitsownHSSEMS,whichismateriallyequivalenttoShell’sHSSEMS;Mode3:contractor/supplierperformsworkunderitsownHSSEMS.Alsoinlinewithindustrystandards,wereportonsafetyperformanceonlyforcontractmodes1and2.Wehaveupdatedsomeofourhistoricalfiguresfollowingareviewofthedata.[B]IncludesfataloccupationalinjuriesandillnessesexceptforthoserelatedtoCOVID-19.ThereweretwoCOVID-19-relatedoccupationalillnessesin2020thatresultedindeath(0employees,2contractors)andoneCOVID-19-relatedfatalityin2021(0employees,1contractor).[C]Definedasaseriouswork-relatedinjuryorillness,includingthosethatresultedinfatalityoralife-alteringevent.Life-alteringeventisdefinedasalong-termorpermanentinjuryorillnesswithsignificantimpactondailyactivities.ExamplesofSIFinclude,butarenotlimitedto,permanenttotaldisability,amputationofabodypart(fullorpartial),reducedbodilymobility(fullorpartial),third-degreeburns,impairedvision,hearing,senseoftasteorsmell.[D]Databefore2019arenotavailable.ThenumberofSIFcasesfor2019and2020reflectsthebestestimate.CombinedworkforceSIFfrequencyfor2019-20wasadjustedtoaccountforsomeuncertaintyinthenumberofSIFcases.68ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataRoadtransportsafety[A]Unit20222021202020192018IpiecaSASBGRIRoadtransportsafetyperformanceSHS-4––Numberofseveremotorvehicleincidentsper100millionSeveremotorvehicleincidentfrequencyrate[B]kilometresdriven3.11.72.13.53.1SHS-4––Numberofseveremotorvehicleincidents[B]Number148102019SHS-4––Numberofroad-transport-relatedfatalitiesNumber10020SHS-4––(employeesandcontractors)KilometresdrivenMillionkm456473471579605SHS-4––[A]Inlinewithindustrystandards,wedistinguishthreecontractmodes.Mode1:contractor/supplierperformsworkunderShell’sHSSEManagementSystem(HSSEMS);Mode2:contractor/supplierperformsworkunderitsownHSSEMS,whichismateriallyequivalenttoShell’sHSSEMS;Mode3:contractor/supplierperformsworkunderitsownHSSEMS.Alsoinlinewithindustrystandards,wereportonsafetyperformanceonlyforcontractmodes1and2.[B]Severemotorvehicleincidentisdefinedasamotorvehicleincidentresultinginafatality,seriousinjuryorarolloverofavehicle.Processsafety[A]Unit20222021202020192018IpiecaSASBGRIOperationalprocesssafetyevents[B][C]Number66103103130121SHS-6EM-EP-540a.1–Tier1Number1538344135UpstreamNumber371076SHS-6EM-EP-540a.1–IntegratedGas,RenewablesandEnergySolutionsNumberSHS-6EM-EP-540a.1–DownstreamNumberOtherNumber22310SHS-6EM-EP-540a.1–Tier2NumberUpstreamNumber929203228SHS-6EM-EP-540a.1–IntegratedGas,RenewablesandEnergySolutionsNumber10111SHS-6EM-EP-540a.1–DownstreamNumberOtherNumber5165698986SHS-6EM-EP-540a.1–113142223SHS-6EM-EP-540a.1–104376SHS-6EM-EP-540a.1–3846495954SHS-6EM-EP-540a.1–22313SHS-6EM-EP-540a.1–[A]Wehaveupdatedsomeofourhistoricalfiguresfollowingareviewofthedata.[B]ProcesssafetyeventsareclassifiedaccordingtoguidancefromtheInternationalAssociationofOil&GasProducersandtheAmericanPetroleumInstitute.[C]In2022,therewerethreeTier1sabotage-relatedevents(notincludedintheabovedata).Theclassificationofsabotage-relatedprocesssafetyeventsismadeonthebest-endeavoursbasis.HealthUnit20222021202020192018IpiecaSASBGRITotalrecordableoccupationalillnessfrequencyNumberpermillion0.20.40.20.50.4SHS-3EM-EP-320a.1403-10(TROIF)(employeesonly)[A]hours[A]DoesnotincludeCOVID-19-relatedoccupationalillnesses.Therewere122COVID-19-relatedemployeeoccupationalillnessesin2022.69ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataSecurity[A]Unit20222021202020192018IpiecaSASBGRISHS-7Usingarmedsecurity%ofcountries1614142021SHS-7––Usingarmedcompanysecurity%ofcountriesSHS-7Usingarmedcontractorsecurity%ofcountries13113––9881110––[A]DataobtainedfromaninternalsurveycompletedbytheseniorShellrepresentativeineachcountry.MoreinthisreportOurPoweringProgresstargetsGreenhousegasandenergydataLetterfromtheCEOMoreonShellwebsitesOurstrategy:PoweringProgressOurapproachTransportsafetyCommunityroadsafety70ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataGreenhousegasandenergydataNetcarbonintensity(NCI)20222021202020192018IpiecaSASBGRIUnitNETCARBONINTENSITY[A][B]gCO2e/MJ7677757879–––NetcarbonintensityTrillion(10^12)MJ16.2917.8918.4021.0522.00EstimatedtotalenergydeliveredbyShell–––Shareofenergydeliveredperenergyproducttype[C][D][E]%4445475655–––Oilproductsandgas-to-liquidsGas%2225211721–––LiquefiednaturalgasBiofuels%2018191816–––PowerTotalestimatedgreenhousegasemissions%11111–––coveredbythenetcarbonintensitycalculation[F][G]%12121297–––Carbonintensityofenergyproductstype[H][I]MilliontonnesCO2e1,2401,3751,3841,6461,731–––Oilproductsandgas-to-liquidsGasgCO2e/MJ9191898988–––LiquefiednaturalgasgCO2e/MJBiofuelsgCO2e/MJ6566676667–––PowergCO2e/MJgCO2e/MJ7070707171–––3941383937–––5866485762–––[A]ThenetcarbonintensitycalculationusesShell’senergyproductsalesvolumedata,asdisclosedintheAnnualReportandSustainabilityReport.Thisexcludescertaincontractsheldfortradingpurposesandisreportednetratherthangross.Business-specificmethodologiesfornetvolumeshavebeenappliedtooilproducts,pipelinegasandpower.Papertradesthatdonotresultinphysicalproductdeliveryareexcluded.RetailsalesvolumesfrommarketswhereShelloperatesundertrademarklicensingagreementsarealsoexcludedfromthescopeofShell’snetcarbonintensitymetric.[B]Acquisitionsanddivestmentsareincludedintheactualperformancetrackingwiththetargetandbaselineyearunchanged.Notethatacquisitionsanddivestmentscouldhaveamaterialimpactonmeetingthetargets.[C]Percentageofdeliveredenergymaynotaddupto100%becauseofrounding.[D]TotalvolumeofenergyproductssoldbyShell,aggregatedonanenergybasis,withelectricityrepresentedasfossilequivalents.ThisvalueisderivedfromenergyproductsalesfiguresdisclosedbyShellintheAnnualReportandtheSustainabilityReport.[E]Lowerheatingvaluesareusedfortheenergycontentofthedifferentproducts.Afossil-equivalenceapproachisusedtoaccountforelectricalenergy,inordertoassesselectricalenergyonthesamebasisasourotherenergyproducts.[F]TotalCO2eemissionsestimatedusingShell'sNetCarbonFootprintvalueandtheestimateoftotaldeliveredenergy.Note,thisestimatedvalueiscalculatedfromtheportfolioaverageintensityvalue,whichisdeterminedinShell'sNetCarbonFootprintcalculation.TotalCO2eemissionsareonlyintendedtogiveanindicationofthescopeoftheemissionsincludedwithinShell'sNetCarbonFootprintanddonotrepresentaninventoryofemissions.CarbonoffsetswereincludedinthetotalestimatedGHGemissionscoveredbytheNetCarbonFootprintcalculation.[G]Thesenumbersincludewell-to-wheelemissionsassociatedwithenergyproductssoldbyShell,onanequityboundarybasis;theyalsoincludethewell-to-tankemissionsassociatedwiththemanufacturingofenergyproductsbyothersthataresoldbyShell.Emissionsassociatedwiththemanufacturinganduseofnon-energyproductsareexcluded.[H]Emissionsincludedinthecarbonintensityofpowerhavebeencalculatedusingthemarket-basedmethod.[I]ThecarbonintensityofbiofuelsreflectstheglobalaverageforbiofuelssoldbyShellfor2022.Salesofgasandpower[A][B]2022202120202019[A]2018IpiecaSASBGRIUnitGasTBtu2,8763,6303,0092,7203,246–––PowerTWh243247252207179–––Incertaincases,priorto2019,itwasnotpossibletodisaggregatesalesofShellandthird-partygasvolumes.Toavoiddouble-countingthesesalesvolumeswerenotincludedintheabovefigures.[A]From2019,gasandpowersalesvolumesarereportedbasedonarevisedmethodology.Salesvolumesreportedexcludethoserelatedtopuretradingactivities.[B]For2018-2021,tableshowssalesofgasandpowerproducedbythird-parties.From2022,Shell’sownpowergenerationisalsoincluded.71ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataScope1GHGemissions(operationalcontrol)[A][B][C][D]20222021202020192018IpiecaSASBGRICCE-4EM-EP-110a.1305-1Unit516063CCE-4EM-EP-110a.1305-1495861CCE-4EM-EP-110a.1305-1DirectGHGemissions(Scope1)MilliontonnesCO2e4055677071CCE-4EM-EP-110a.1305-1Carbondioxide(CO2)MilliontonnesCCE-4EM-EP-110a.1305-1Methane(CH4)Thousandtonnes1116769CCE-4EM-EP-110a.1305-1Nitrousoxide(N2O)Thousandtonnes262530CCE-4EM-EP-110a.1305-1Hydrofluorocarbons(HFCs)Tonnes0.010.010.019192CCE-4EM-EP-110a.1305-1Sulphurhexafluoride(SF6)TonnesPerfluorocarbons(PFC)Tonnes00011Nitrogentrifluoride(NF3)Tonnes000Scope1emissionsbybusiness2931UpstreamMilliontonnesCO2eIntegratedGasMilliontonnesCO2e0.010.03DownstreamMilliontonnesCO2eRefining[E]MilliontonnesCO2e00ChemicalsMilliontonnesCO2eOtherDownstream[F]MilliontonnesCO2e00Other[G]MilliontonnesCO2eScope1emissionsbycountry8.311.712.812.914.8CCE-4EM-EP-110a.1305-1USAMilliontonnesCO2e14.715.514.116.313.0CCE-4EM-EP-110a.1305-1MiddleEastMilliontonnesCO2e27.332.635.840.242.7CCE-4EM-EP-110a.1305-1NetherlandsMilliontonnesCO2e14.620.123.428.029.1CCE-4EM-EP-110a.1305-1SingaporeMilliontonnesCO2e11.511.010.810.511.6CCE-4EM-EP-110a.1305-1AustraliaMilliontonnesCO2e1.6CCE-4EM-EP-110a.1305-1CanadaMilliontonnesCO2e1.21.40.21.82.1CCE-4EM-EP-110a.1305-1NigeriaMilliontonnesCO2e0.20.20.20.8GermanyMilliontonnesCO2eMalaysiaMilliontonnesCO2e1013161920CCE-4EM-EP-110a.1305-1UnitedKingdomMilliontonnesCO2eCCE-4EM-EP-110a.1305-1InternationalwatersMilliontonnesCO2e899910CCE-4EM-EP-110a.1305-1RestoftheworldMilliontonnesCO2eCCE-4EM-EP-110a.1305-177777CCE-4EM-EP-110a.1305-1CCE-4EM-EP-110a.1305-145667CCE-4EM-EP-110a.1305-1CCE-4EM-EP-110a.1305-155474CCE-4EM-EP-110a.1305-1CCE-4EM-EP-110a.1305-145566CCE-4EM-EP-110a.1305-1CCE-4EM-EP-110a.1305-135544333342232322222111221233472ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataUnit20222021202020192018IpiecaSASBGRIScope1emissionsbysourceMilliontonnes4958616769CCE-4EM-EP-110a.2305-1CO2emissionsMilliontonnesCCE-4EM-EP-110a.2305-1CombustionMilliontonnes4147505354CCE-4EM-EP-110a.2305-1FlaringMilliontonnesCCE-4EM-EP-110a.2305-1VentingandprocessMilliontonnes45476CCE-4EM-EP-110a.2305-1FugitivesThousandtonnesCCE-4EM-EP-110a.2305-1CH4emissionsThousandtonnes46689CCE-4EM-EP-110a.2305-1CombustionThousandtonnesCCE-4EM-EP-110a.2305-1FlaringThousandtonnes00000CCE-4EM-EP-110a.2305-1VentingandprocessThousandtonnesCCE-4EM-EP-110a.2305-1FugitivesMilliontonnesCO2e4055679192CCE-4EM-EP-110a.2305-1OthergreenhousegasesMethane(CH4)emissions67111313MethaneemissionsinCO2equivalent[H]Methaneemissionsintensity-assetswith1219151918marketedgasMethaneemissionsintensity-assetswithout1622294445marketedgasUpstreamflaring[I]67121516GHGemissionsfromflaringTotalhydrocarbonsflared0.20.20.30.30.3NigeriaRestoftheworldMilliontonnesCO2e1.01.41.72.32.3CCE-4EM-EP-110a.1305-1Totalhydrocarbonsflared-routineTotalhydrocarbonsflared-non-routine%0.050.060.060.080.08CCE-4EM-EP-110a.1305-1Upstreamflaringintensity[J]GHGemissionsfromexportedenergy[K]%0.010.010.010.010.01CCE-4EM-EP-110a.1305-1MilliontonnesCO2e3.04.53.85.95.2CCE-4EM-EP-110a.2305-1MilliontonnesCCE-4EM-EP-110a.2305-1Milliontonnes0.81.31.11.81.5CCE-4EM-EP-110a.2305-1MilliontonnesCCE-4EM-EP-110a.2305-1Milliontonnes0.40.80.60.70.6Milliontonnes–––%0.40.40.51.21.0–––MilliontonnesCO2e–––0.10.20.30.50.6CCE-4EM-EP-110a.2305-10.71.00.81.40.90.60.80.60.90.823333[A]Greenhousegasemissions(GHG)comprisecarbondioxide,methane,nitrousoxide,hydrofluorocarbons,perfluorocarbons,sulphurhexafluorideandnitrogentrifluoride.Thedataarecalculatedusinglocallyregulatedmethodswheretheyexist.Wherethereisnolocallyregulatedmethod,thedataarecalculatedusingthe2009APICompendium,whichistherecognisedindustrystandardundertheGHGProtocolCorporateAccountingandReportingStandard.Thereareinherentlimitationstotheaccuracyofsuchdata.Oilandgasindustryguidelines(Ipieca/API/IOGP)indicatethatseveralsourcesofuncertaintycancontributetotheoveralluncertaintyofacorporateemissionsinventory.WehaveestimatedtheoveralluncertaintyforourdirectGHGemissionstobearound3%for2022.[B]GHGemissionswerecalculatedusingglobalwarmingpotential(GWP)factorsfromtheIPCC’sFourthAssessmentReport.Forcomparison,ourScope1emissionswouldhavebeen51milliontonnesin2022ifweweretouseGWPsfromIPCC'sFifthAssessmentReport.[C]GHGemissionsinthistabledonotincludecarboncredits.[D]Splitbybusinessorcountrymaynotadduptothetotalduetorounding.[E]IncludesScotfordUpgraderandQuestCarbonCaptureandStorage.ExcludesCO2capturedandsequesteredbyQuest,butScope1and2GHGemissionsfromoperatingQuestareincluded.[F]IncludesemissionsfromotherDownstreamassetsandactivities(e.g.shipping,lubricantsandtrading&supply).[G]IncludesemissionsfromassetsandactivitiesreportedbytheProjects&TechnologybusinessandGlobalFunctions.[H]MethaneemissionswereconvertedtoCO2equivalentsusingGWPsfromtheIPCC'sFourthAssessmentReport.Forcomparison,ourmethaneemissionswouldhavebeen1.1milliontonnesinCO2equivalentsin2022ifweweretouseGWPsfromIPCC'sFifthAssessmentReport.[I]IncludesUpstreamandIntegratedGasbusinesses.[J]Calculatedastotalhydrocarbonsflareddividedbysumoftotaloilandgaswellheadproduction,LNGandGTLproductionx100%.[K]GHGemissionsrelatedtoenergyproduction(intheformofelectricity,heatorsteam)thatwasexportedtoanotherfacilityorpublicgrid.ThisisasubsetofourScope1GHGemissions.73ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataScope2GHGemissions(operationalcontrol)[A][B]20222021202020192018IpiecaSASBGRI–305-2Unit–305-2Scope2emissions-market-basedmethodMilliontonnesCO2e7881011CCE-4Scope2emissions-location-basedmethodMilliontonnesCO2e89101111CCE-4Scope2emissionsbybusiness(market-basedmethod)UpstreamMilliontonnesCO2e0.50.60.61.11.4CCE-4–305-2–305-2IntegratedGasMilliontonnesCO2e1.41.41.51.62.4CCE-4–305-2–305-2DownstreamMilliontonnesCO2e5.25.66.06.96.8CCE-4OtherMilliontonnesCO2e0.10.10.10.20.2CCE-4Scope2emissionsbycountry(market-basedmethod)USAMilliontonnesCO2e2.32.63.03.13.2CCE-4–305-2–305-2NetherlandsMilliontonnesCO2e1.51.51.41.71.8CCE-4–305-2–305-2AustraliaMilliontonnesCO2e1.41.31.41.62.4CCE-4–305-2–305-2CanadaMilliontonnesCO2e1.01.21.32.32.0CCE-4–305-2SingaporeMilliontonnesCO2e0.60.50.50.50.5CCE-4GermanyMilliontonnesCO2e0.20.20.30.30.4CCE-4RestoftheworldMilliontonnesCO2e0.20.20.20.30.4CCE-4Scope2emissionsbybusiness(location-basedmethod)UpstreamMilliontonnesCO2e0.40.60.61.11.2CCE-4–305-2–305-2IntegratedGasMilliontonnesCO2e2.42.62.72.72.4CCE-4–305-2–305-2DownstreamMilliontonnesCO2e5.25.56.17.16.8CCE-4OtherMilliontonnesCO2e0.20.10.20.20.2CCE-4Scope2emissionsbycountry(location-basedmethod)USAMilliontonnesCO2e2.32.63.13.23.4CCE-4–305-2–305-2AustraliaMilliontonnesCO2e2.32.52.62.62.4CCE-4–305-2–305-2NetherlandsMilliontonnesCO2e1.31.41.31.61.7CCE-4–305-2–305-2CanadaMilliontonnesCO2e1.01.21.42.32.0CCE-4–305-2SingaporeMilliontonnesCO2e0.60.50.50.50.5CCE-4GermanyMilliontonnesCO2e0.20.20.30.40.3CCE-4RestoftheworldMilliontonnesCO2e0.30.30.40.40.4CCE-4[A]Splitbybusinessorcountrymaynotadduptothetotalduetorounding.[B]Weestimatedtheuncertaintyofour2022Scope2GHGemissionstobearound7%forthemarket-basedmethodand6%forthelocation-basedmethod.74ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataGHGintensities(operationalcontrol)20222021202020192018IpiecaSASBGRIUnitUpstreamandIntegratedGasGHGTonneCO2e/tonneintensity[A]production0.1790.1720.1590.1680.158UpstreamandIntegratedGasGHGCCE-4–305-4intensity[B]–305-4kgCO2e/boe2322212221CCE-4–305-4RefineryGHGintensity[C]–305-4TonneCO2e/0.981.051.051.061.05CCE-4ChemicalGHGintensity[D]UEDCTMTonneCO2e/tonneproduction1.000.950.981.040.96CCE-4[A]IntonnesofScope1andScope2GHGemissionspertonneofoilandgasavailableforsale,liquefiednaturalgasandgas-to-liquidsproductioninIntegratedGasandUpstream.2021figuredoesnotincludePreludeFloatingLiquefiedNaturalGas(FLNG).[B]InkilogramsofScope1andScope2GHGemissionsperboeofoilandgasavailableforsale,liquefiednaturalgasandgas-to-liquidsproductioninIntegratedGasandUpstream.2021figuredoesnotincludePreludeFloatingLiquefiedNaturalGas(FLNG).[C]UEDC(UtilisedEquivalentDistillationCapacity)isaproprietarymetricofSolomonAssociates.Itisacomplexity-weightednormalisationparameterthatreflectstheoperatingcostintensityofarefinerybasedonsizeandconfigurationofitsparticularmixofprocessandnon-processfacilities.[D]ChemicalGHGintensityreferstohigh-valuechemicals,whichincludeolefinproducts(ethyleneandpropylene)plusthecontainedbutadiene,benzene,acetylene,andhigh-purityhydrogenproduction.Scope1and2GHGemissions(equityboundary)[A]20222021202020192018IpiecaSASBGRICCE-4EM-EP-110a.1305-1UnitCCE-4EM-EP-110a.1305-1CCE-4EM-EP-110a.1305-1DirectGHGemissions(Scope1)MilliontonnesCO2e829198105102CCE-4EM-EP-110a.1305-1UpstreamMilliontonnesCO2e16.318.520.121.722.2CCE-4EM-EP-110a.1305-1IntegratedGasMilliontonnesCO2e26.924.524.225.925.2CCE-4305-2DownstreamMilliontonnesCO2e38.747.653.257.353.8CCE-4–305-2OtherMilliontonnesCO2e0.20.20.20.2CCE-4–305-2Scope2emissions(market-basedmethod)MilliontonnesCO2e0.8CCE-4–305-2UpstreamMilliontonnesCO2e8991111CCE-4–305-2IntegratedGasMilliontonnesCO2e0.50.70.71.21.3–DownstreamMilliontonnesCO2e1.21.11.01.11.8OtherMilliontonnesCO2e6.26.77.18.0Scope2emissions(location-based0.10.10.10.27.7method)MilliontonnesCO2e0.2UpstreamMilliontonnesCO2eIntegratedGasMilliontonnesCO2e910101211–––DownstreamMilliontonnesCO2e0.50.70.81.21.2CCE-4OtherMilliontonnesCO2e1.81.81.71.81.8CCE-4–305-26.57.07.58.37.6CCE-40.20.10.20.20.3CCE-4–305-2–305-2–305-2[A]Splitbybusinessmaynotadduptothetotalduetorounding.75ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataScope3GHGemissions[A][B]20222021202020192018IpiecaSASBGRIUnitPurchasedgoodsandservices(Category1)Third-partyproducts[C]MilliontonnesCO2e144147147178190CCE-4–305-3Fuelandenergy-relatedactivities(notincludedinScope1orScope2)(Category3)Third-partypower[D]MilliontonnesCO2e11513610310296CCE-4–305-3Downstreamtransportanddistribution(Category9)Soldownenergyproducts[E]MilliontonnesCO2e56–––––305-3Useofsoldproducts(Category11)Useofsoldproducts[F]MilliontonnesCO2e9101,0101,0541,2711,351CCE-4–305-3Ownproduction[G]MilliontonnesCO2e332380452564594CCE-4–305-3Third-partyproducts[H]MilliontonnesCO2e578630602708757CCE-4–305-3[A]ThevaluesinthistablereflectestimatedScope3emissionsincludedinournetcarbonintensity.Thisexcludescertaincontractsheldfortradingpurposesandreportednetratherthangross.Business-specificmethodologiesfornetvolumeshavebeenappliedtooilproducts,pipelinegasandpower.Papertradesthatdonotresultinphysicalproductdeliveryareexcluded.RetailsalesvolumesfrommarketswhereShelloperatesundertrademarklicensingagreementsarealsoexcludedfromthescopeofShell’scarbonintensitymetric.[B]EstimatedemissionsfromotherScope3categoriesarepublishedonwww.shell.com/ghg.2022datawillbeavailablearoundJune2023.[C]Thiscategoryincludesestimatedwell-to-tankemissionsfrompurchasedthird-partyrefinedoilproducts,naturalgas,liquefiednaturalgas,crudeoilandbiofuels.[D]Thiscategoryincludesestimatedwell-to-wireemissionsfromthegenerationofpurchasedpowerincludedinournetcarbonintensity.[E]Estimatedemissionsfromthetransportanddistributionofsoldownoilproducts,crudeoil,liquefiednaturalgas,gas-to-liquids,naturalgasandbiofuels.[F]Thiscategoryincludesestimatedemissionsfromthesalesvolumesofoilproducts,naturalgas,liquefiednaturalgas,gas-to-liquidsandbiofuels.[G]Thiscategoryincludesestimatedemissionsfromourrefineryproduction,naturalgas,liquefiednaturalgas,gas-to-liquidsandbiofuelproducts.[H]Estimatedasthedifferencebetweenownproductionandtotalsoldproducts.Othergreenhousegasdata(operationalcontrol)[A]20222021202020192018IpiecaSASBGRIUnitCarboncaptureandstorageandCO2Milliontonnes0.971.050.941.131.07CCE-3EM-EP-530a.1305-5transferoutMilliontonnes0.350.390.300.430.46CCE-3EM-EP-530a.1305-5CO2capturedandstoredCO2transferredout[B]Thousandtonnes7.943.600.270.000.00–––BiogenicCO2BiogenicCO2[C][A]Wehaveupdatedsomeofourhistoricalfiguresfollowingareviewofthedata.[B]CO2capturedandtransferredtoanotherorganisation(forexample,soldorgivenforfree)asproductorfeedstock,whichisnotincludedinourScope1emissions.[C]DirectbiogenicCO2,whichisnotincludedinourScope1emissions.CarboncreditsUnit[B]20222021202020192018IpiecaSASBGRITotalcarboncreditsretired[A]Millioncarboncredits4.15.13.92.20.0–EM-EP-530a.1305-5IncludedinShell’snetcarbonintensitytargetMillioncarboncredits1.71.30.40.5n/cExcludedfromShell’snetcarbonintensitytarget–EM-EP-530a.1305-5[A]CarboncreditsretiredincludeswhatShellretiresforcustomersolutionslinkedwithourenergyandnon-energyproducts,Shell’scorporatetravel,andShellGroupandassetretirements.[B]OnecarboncreditrepresentstheavoidanceorremovalofonemetrictonneofCO2equivalent.n/c=notcollected76ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataEnergyuse(operationalcontrol)[A]20222021202020192018IpiecaSASBGRICCE-6–302-1UnitCCE-6–302-1CCE-6–302-1TotalenergyuseMillionMWh199223241264268CCE-6–302-1OwnenergygeneratedMillionMWhCCE-6–302-1ImportedelectricityMillionMWh177202219236240CCE-6–302-1ImportedsteamandheatMillionMWhExportedelectricityMillionMWh1920222726ExportedsteamandheatMillionMWhConsumptionofenergyfromrenewable1214141715sourcesRenewablesources-onsiteenergy711121010generationconsumedRenewablesources-purchasedelectricity22263Renewablesources-purchasedsteamRenewablesources-electricityexportedtoMillionMWh0.0170.0050.005n/cn/cCCE-6–302-1gridMillionMWh2.22.21.81.50.03CCE-6–302-1EnergyintensityMillionMWhn/cn/cCCE-6–302-1Upstreamexcl.oilsands,LNGandGTL0.000.000.00Refineries:RefineryEnergyIndex[B]MillionMWhCCE-6–302-1Chemicalplants:ChemicalsEnergyIntensity0.30.40.40.4n/cCCE-6–302-3GJ/tonneproduction1.191.141.151.071.06CCE-6–302-3Index95.696.996.194.294.3CCE-6–302-3GJ/tonneproduction19.318.118.719.418.3n/c=notcollected[A]Wehaveupdatedsomeofourhistoricalfiguresfollowingareviewofthedata.[B]Dataareindexedto2002,basedonSolomonAssociatesEnergyIntensityIndexmethodology.MoreinthisreportOurPoweringProgresstargetsSafetydataLetterfromtheCEOMoreonShellwebsitesOurstrategy:PoweringProgressGreenhousegasemissions77ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataOtherenvironmentaldataAiremissions[A]20222021202020192018IpiecaSASBGRIUnitAcidgasesandvolatileorganiccompoundsThousandtonnes3632366574ENV-5EM-EP-120a.1305-7Sulphuroxides(SOx)ThousandtonnesENV-5EM-EP-120a.1305-7UpstreamThousandtonnes3441519ENV-5EM-EP-120a.1305-7IntegratedGasThousandtonnesENV-5EM-EP-120a.1305-7DownstreamThousandtonnes22344ENV-5EM-EP-120a.1305-7OtherThousandtonnesENV-5EM-EP-120a.1305-7Nitrogenoxides(NOx)Thousandtonnes3026294751ENV-5EM-EP-120a.1305-7UpstreamThousandtonnesENV-5EM-EP-120a.1305-7IntegratedGasThousandtonnes00000ENV-5EM-EP-120a.1305-7DownstreamThousandtonnesENV-5EM-EP-120a.1305-7OtherThousandtonnes93105118108111ENV-5EM-EP-120a.1305-7Volatileorganiccompounds(VOCs)ThousandtonnesENV-5EM-EP-120a.1305-7UpstreamThousandtonnes4855604041ENV-5EM-EP-120a.1305-7IntegratedGasThousandtonnesENV-5EM-EP-120a.1305-7DownstreamThousandtonnes1314121310ENV-5EM-EP-120a.1305-7OtherOzone-depletingemissionsTonnes3136465558CFCs/halons/trichloroethaneTonnesHydrochlorofluorocarbons(HCFCs)11012384547555910171717257881562021222329000000.00.00.00.00.0ENV-5–305-622689ENV-5–305-6[A]Splitbybusinessmaynotadduptothetotalduetorounding.78ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataSpillsofmorethan100kgtotheenvironment20222021202020192018IpiecaSASBGRIUnitSpills[A]Number75106122156109ENV-6EM-EP-160a.2306-3Sabotagespills–number[B]ThousandtonnesENV-6EM-EP-160a.2306-3Sabotagespills–totalvolume[B]Thousandtonnes0.63.31.52.31.8ENV-6EM-EP-160a.2306-3Sabotagespills-recoveredvolumeNumberENV-6EM-EP-160a.2306-3Operationalspills–numberNumber0.33.01.0n/cn/cENV-6EM-EP-160a.2306-3Nigeria[C][D]NumberENV-6EM-EP-160a.2306-3RestoftheworldThousandtonnes5442706893ENV-6EM-EP-160a.2306-3Operationalspills-totalvolume[E]ThousandtonnesENV-6EM-EP-160a.2306-3Nigeria[C]Thousandtonnes10912815ENV-6EM-EP-160a.2306-3RestoftheworldThousandtonnesENV-6EM-EP-160a.2306-3Operationalspills-recoveredvolumeThousandtonnes4433586078ENV-6EM-EP-160a.2306-3ThousandtonnesENV-6EM-EP-160a.2306-3Nigeria[C]Number0.060.050.40.20.9ENV-6EM-EP-160a.2306-3RestoftheworldThousandtonnesENV-6EM-EP-160a.2306-3Hurricanespills–number[F]Thousandtonnes0.010.030.030.030.4ENV-6EM-EP-160a.2306-3Hurricanespills–totalvolume[F]Hurricanespills-recoveredvolume0.060.020.40.20.50.040.030.1n/cn/c0.000.020.01n/cn/c0.040.010.1n/cn/c020000.000.030000.000.010n/cn/cn/c-notcollected[A]Allspillvolumesandnumbersareforhydrocarbonspillsofmorethan100kilogramstotheenvironment(landorwater).Wehaveupdatedsomeofourhistoricalfiguresfollowingareviewofthedata.[B]Allsabotage-andtheft-relatedspillsin2018-22occurredinNigeria.[C]NigeriaincludesSPDConshoreoperationsandSNEPCooffshoreoperations.[D]NigeriaincludesSPDConshoreoperations(10operationalspillsin2022)andSNEPCooffshoreoperations(zerooperationalspillsin2022).[E]SplitbetweenNigeriaandtherestoftheworldmaynotadduptothetotalduetorounding.[F]Thiscategoryreflectsthespillscausedbyexceptionalnaturalevents,suchashurricanesandearthquakes.2021datareflecttheimpactofHurricaneIda.79ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataWateruseanddischargeUnit20222021202020192018IpiecaSASBGRIWateruseanddischarge[A]Millioncubicmetres156166171192199ENV-1EM-EP-140a.1303-3FreshwaterwithdrawnMillioncubicmetres111122127145147ENV-1EM-EP-140a.1303-5FreshwaterconsumedFreshwaterconsumedinhighwaterstressMillioncubicmetres1822222525ENV-1EM-EP-140a.1303-3areas[B]Millioncubicmetres4544454653Freshwaterreturned[C]ENV-1EM-EP-140a.1303-3FreshwaterwithdrawnbybusinessMillioncubicmetres1696811ENV-1EM-EP-140a.1303-3UpstreamMillioncubicmetres44344ENV-1EM-EP-140a.1303-3IntegratedGasMillioncubicmetres134151159177182ENV-1EM-EP-140a.1303-3DownstreamMillioncubicmetres32333OtherENV-1EM-EP-140a.1303-3FreshwaterwithdrawnbycountryMillioncubicmetres718492108109ENV-1EM-EP-140a.1303-3USAMillioncubicmetres2021212324ENV-1EM-EP-140a.1303-3CanadaMillioncubicmetres1720192222ENV-1EM-EP-140a.1303-3SingaporeMillioncubicmetres1516161716ENV-1EM-EP-140a.1303-3NetherlandsMillioncubicmetres1313131214ENV-1EM-EP-140a.1303-3GermanyMillioncubicmetres2012101115RestoftheworldENV-1EM-EP-140a.1303-3FreshwaterwithdrawnbysourceMillioncubicmetres84919498102ENV-1EM-EP-140a.1303-3SurfaceMillioncubicmetres2418181821ENV-1EM-EP-140a.1303-3GroundMillioncubicmetres4957607677ENV-1EM-EP-140a.1303-3Publicutilities[D]MillioncubicmetresENV-1EM-EP-140a.2Other[E]Millioncubicmetres00000ENV-1EM-EP-140a.2–ProducedwaterdisposedMillioncubicmetres5881889296ENV-1EM-EP-140a.2–ProducedwaterreinjectedMillioncubicmetresENV-1EM-EP-140a.2–ProducedwaterdischargedMillioncubicmetres217212122ENV-2EM-EP-140a.2–ProducedwaterexportedfordisposalorreuseThousandtonnes4047515149ENV-2EM-EP-140a.2–OilineffluentstosurfaceenvironmentThousandtonnes1616161925–Oilinproducedwater0.91.01.41.31.40.60.70.90.90.9[A]Freshwaterfiguresdonotincludeonce-throughcoolingwater.Breakdownmaynotadduptothetotalduetorounding.[B]Attheendof2022,fourofourmajorfacilitieswerelocatedinareaswherethereisahighlevelofwaterstressbasedonanalysisusingwaterstresstools,includingtheWorldResourcesInstitute’sAqueductWaterRiskAtlasandalocalassessment.Thefacilitiesare:Pearlgas-to-liquids(GTL)plantinQatar,ShellEnergyandChemicalsParkandtheJurongIslandchemicalplantinSingaporeandtheTabangaoimportterminalinthePhilippines.[C]Definedasfreshwaterreturnedtoafresh-watersource.[D]Includesimportedsteam.[E]Includesharvestedrainwaterandsurfacerun-offcollectedforuse.80ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataWastemanagement[A]20222021202020192018IpiecaSASBGRIUnitWasteThousandtonnes1,9821,9932,0492,1131,999ENV-7–306-5TotalwastedisposedThousandtonnes8681,025558698592ENV-7–306-5HazardouswastedisposedThousandtonnes11212236ENV-7–306-5Thousandtonnes19345269015ENV-7–306-5UpstreamThousandtonnes646940352537ENV-7–306-5IntegratedGasThousandtonnes9175524ENV-7–306-5DownstreamThousandtonnes1,114650ENV-7–306-5OtherThousandtonnes128201,49141,407ENV-7–306-5Non-hazardouswastedisposedThousandtonnes262141,414278ENV-7–306-5UpstreamThousandtonnes8869691825217ENV-7–306-5IntegratedGasThousandtonnes74193ENV-7–306-5Downstream961,235231,095OtherThousandtonnes607241,11617ENV-7–306-4Wastebeneficiallyreused,recycledorThousandtonnes73ENV-7–306-4recovered[B]Thousandtonnes24ENV-7–306-4UpstreamThousandtonnesENV-7–306-4IntegratedGasThousandtonnes457399448441419ENV-7–306-4DownstreamOther598197585783615251238427633235432867443[A]Splitbybusiness:maynotadduptothetotalduetorounding.[B]Notincludedinthetotalwastedisposed.MoreinthisreportOurPoweringProgresstargetsGreenhousegasandenergydataLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissions81ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataSocialperformancedataToensurethatthedataarereadandinterpretedincontext,thedatabelowshouldbereadinconjunctionwiththerelevantnarrativesinourSustainabilityReports,AnnualReports,DiversityPayGapReports,Shell.comandanyothersourcesreferenced.Ourpeople20222021202020192018IpiecaSASBGRIEmployees(thousand)[A]9383888782––2-7Ourpeoplebygeographicalarea[A]Africa4444–––2-7AsiaEurope32303131–––2-7NorthAmericaOceania30272827–––2-7SouthAmericaStaffforumsandgrievanceprocedures23182021–––2-7%countrieswithstaffaccesstostaffforum,grievanceprocedureorothersupportsystem3232–––2-7IntegrityCodeofConductviolations[B]1122–––2-7100100100100100SOC-12EM-EP-210a.3103-2183181216263370GOV-1EM-EP-540a.2102-17[A]Allmetricsthroughoutthissectionexcludetheemployeesinportfoliocompanies,exceptforthemetricsreflectingtotalemployeenumbersandactualnumberofemployeesbygeography.Theemployeenumbersfor2021and2020reflectheadcountintheShellHRsystemandfull-timeequivalentnumbersforportfoliocompanies,whichmaintaintheirownHRsystems.[B]CodeofConductviolationsrepresentthenumberofreportedincidentsintheShellGlobalHelpline(excludingqueriesorcustomerservicequeries)thathavebeeninvestigatedandclosedduringtherelevantperiodandwheretheallegationwasfoundtobe(atleastpartially)true.DataobtainedfromaninternalsurveycompletedbytheseniorShellrepresentativeineachcountry.Training20222021202020192018IpiecaSASBGRITrainingdaysforemployeesandjoint-venturepartners(thousand)[A]266271234373315SOC-7–404-1RespectintheWorkplacetrainingcompletionrate%[B]99.097.7––––ConsciousInclusiontrainingcompletionrate%[B]98.0––[A]Trainingdaysmetricexcludestheemployeesinportfoliocompanies,whichmaintaintheirownHRsystems.[B]ThesearetheDE&Imandatorytrainingthatmustbetakenannuallyfortwoyearsbyallemployeesincludingportfoliocompaniesandcontractors.Completionraterefersto100%ofnominatedlearnersminusthe%ofnominatedlearnersthatdidnotcompletetheirtrainingwithinthedesignatedperiodasatDecember3182ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdataDiversity,equityandinclusion[A]20222021202020192018IpiecaSASBGRIGender55.050.038.042.045.0SOC-5–405-1BoardofDirectors(%women)45.050.062.058.055.0SOC-5BoardofDirectors(%men)22.225.012.512.512.5SOC-5–405-1ExecutiveCommittee(%women)77.875.087.587.587.5SOC-5ExecutiveCommittee(%men)–405-1Inseniorexecutiveleadershippositions(%women)[B]SOC-5(Ambition:30%,thengenderequality)SOC-5–405-1Inseniorexecutiveleadershippositions(%men)Inseniorleadershippositions(%women)[C](Ambition:35%25.427.3–––SOC-5–405-1by2025;40%by2030)SOC-5Inseniorleadershippositions(%men)74.672.7–––SOC-5–405-1Inmanagementpositions(%women)SOC-5Inmanagementpositions(%men)30.429.527.826.424.0SOC-5–405-1Inprofessionalpositions(%women)69.670.572.273.676.0SOC-5Inprofessionalpositions(%men)27.927.225.524.523.7SOC-5–405-1Employeesoverall(%women)[A]72.172.874.575.576.3SOC-5Employeesoverall(%men)[A]35.134.333.130.829.9SOC-5–405-1Graduatehires(%women)(Ambition:50%everyyear)[D]64.865.766.969.270.1SOC-5Graduatehires(%men)[D]33.033.032.031.031.0SOC-5–405-1Experiencedhires(%women)[E]67.067.068.069.069.0SOC-5Experiencedhires(%men)[E]49.155.151.344.845.8SOC-5–405-1Promotions(%women)50.944.948.755.253.9SOC-5Promotions(%men)40.343.539.438.940.9SOC-6–405-1Turnover(%voluntaryresignation)59.656.560.661.159.1Turnover(%womenvoluntaryresignationoftotalwomen40.143.738.639.8SOC-6–405-1employees)59.956.361.460.2–SOC-6Turnover(%menvoluntaryresignationoftotalmenemployees)––405-1Race/ethnicity[F]5.04.42.63.53.6BoardofDirectors(Ambition:MaintainorexceedParker–401-1;405-1Reviewrecommendationofonedirectorby2021)ExecutiveCommittee(numberofethnicminority)[G]–401-1;405-1Employees(USAonly)[H]Asian%–401-1;405-1BlackorAfricanAmerican%HispanicLatino%–401-1;405-1White%Otherracialandethnicgroups%[I]–––––401-16.25.73.44.74.6–401-14.53.82.33.03.2–401-111–––––405-1113.713.0–––SOC-5–405-1SOC-58.78.4–––SOC-5–405-1SOC-511.911.8–––SOC-5–405-163.565.0––––405-12.21.8––––405-183ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdata20222021202020192018IpiecaSASBGRISOC-5–405-1Inseniorleadershippositions(USAonly)[C]10.110.5–––SOC-5–405-1Asian%SOC-5–405-1BlackorAfricanAmerican%8.87.9–––SOC-5–405-1HispanicLatino%SOC-5–405-1White%5.77.5–––SOC-5–405-1Otherracialandethnicgroups%[I]Employees(UKonly)%ofthosewhoself-identified[J][K]74.073.2–––Asian%Black%1.30.8–––Mixed%White%14.513.1–––SOC-5–405-1Otherethnicminoritybackground%SOC-5Inseniorleadershippositions(UKonly)%ofthosewhoself-3.73.4–––SOC-5–405-1identified[C][L]SOC-5Asian%2.42.4–––SOC-5–405-1Black%Mixed%76.578.5––––405-1White%Otherethnicminoritybackground%3.02.6––––405-1LGBT+12.310.8–––SOC-5–405-1GlobalWorkplacePrideBenchmark-measuresLGBTIQ+SOC-5inclusionpracticesofinternationallyactiveemployers1.51.1–––SOC-5–405-1HumanRightsCampaignFoundation’sCorporateEqualitySOC-5Index2022-RatingWorkplacesonequalityandinclusionfor2.01.7–––SOC-5–405-1LGBTQ+employees(USAonly)(%of100)DisabilityinclusionandenABLEment81.883.5––––405-1Workplaceaccessibility(numberoflocations)Agegroup(employees)2.52.8––––405-1Under30yearsold%Between30-50yearsold%Am-Above50yearsold%bas-Advo-Advo-Advo-sadorcatecatecate[M][N][N][N]––––100100100100100–––81868383––––14.013.014.014.0–SOC-5–405-1SOC-564.065.064.071.0–SOC-5–405-122.022.022.015.0––405-184ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurShellshareholdervalueperformanceOurcorevaluesemissionsRespectingnaturePoweringlivesdata20222021202020192018IpiecaSASBGRIAveragepaygap-genderandethnicityfrom17.81818.7–SOC-5–405-211.7%Averagegenderpaygap(UK)[O]21.98.5––SOC-5––toYesSOC-5Averageethnicitypaygap(UK)[P]20.7%YesYesYes–401-3Parentalleave80/Globalminimumstandardformaternityleaveof16weeksfrom84––––––Employeesentiment-diversity,equityandinclusion-1.3%(DE&I)indicator[Q]ShellPeopleSurveyDE&IIndex(outof100points)/comparedtototop-quartilebenchmarkfortherelevantyear18.7%Yes82/84[A]Allmetricsthroughoutthissectionexcludetheemployeesinportfoliocompaniesexceptforthepercentageofemployeesbygender.[B]Thetotalnumberofseniorexecutiveleadershippositionsmaychangefromyeartoyear,andourfocusisonrepresentationasa%ofthistotalgroup.SeniorexecutiveleadershippositionsincludetheExecutiveCommittee.[C]Thetotalnumberofseniorleadershippositionsmaychangefromyeartoyear,andourfocusisonrepresentationasa%ofthistotalgroup.SeniorleadershipisaShellmeasurebasedonsalarygrouplevels.[D]Allgraduatehiresprovideddataordeclaredtheirgenderin2022.[E]0.1%ofexperiencedhiresdidnotprovidedataorchosenottodeclarein2022.Experiencedhiresincludealltypesofhiringexceptgraduatehires.[F]InadditiontoBoardrepresentation,wehaveincludedraceandethnicitydatafortheUSAandUKinlinewithourPoweringLivescommitments.[G]Asethnicdeclarationisvoluntary,eightoutofnineExecutiveCommitteemembersdeclaredtheirraceandethnicity.[H]EmployeesintheUSAatCompensationGrade10andabove.[I]“Otherracialandethnicgroups”includesthefollowing:AmericanIndianorAlaskanNative;NativeHawaiianorotherPacificIslander;twoormoreraces.[J]EmployeesintheUKatCompensationGrade10andabove.[K]Asethnicdeclarationisvoluntary,ethnicitydeclarationrateisnot100%andallcalculationsarebasedonadeclarationrateof82.7%intheUKasofDecember2022.The17.3%ofourworkforcewhohavenotprovideddataorhavechosennottodeclaretheirethnicitywerenotincludedinourcalculations.[L]Asethnicdeclarationisvoluntary,ethnicitydeclarationrateisnot100%andallcalculationsarebasedonadeclarationrateof71.5%foremployeesinseniorleadershippositionsintheUKasofDecember2022.The28.5%ofourseniorleadershipworkforcewhohavenotprovideddataorhavechosennottodeclaretheirethnicitywerenotincludedinourcalculations.[M]"Ambassador"organisationsaredefinedbyWorkplacePrideaswelladvancedintheirLGBTIQ+WorkplaceInclusionjourneys.[N]"Advocate"organisationsaredefinedbyWorkplacePrideasbreakingnewgroundforLGBTIQ+inclusionintheiractivitiesaroundtheworldandsettingthetoneforchangebeyondtheworkplaceinsocietyatlarge.[O]Theaveragepayofallmenandallwomenfor"ShellintheUK",whichincludesShellEnergyRetailLimited,isdefinedintheShellUK2022DiversityPayGapreport.ItexcludesbonusesusingmethodologyconsistentwiththeUK'sAdvisory,ConciliationandArbitrationServicemanaginggenderpayreportingguidance.TheguidancewasupdatedinFebruary2019,andthedatasnapshotwastakenonApril5,2022.Thisisdifferenttoequalpaywhichmeanspayingmenandwomenthesamesalaryforperformingequivalentwork.ShellintheUKhashadequalpayformanyyears,andweconductregularpayequityanalysistomonitorthisonanongoingbasis.PleasereadtheShellUK2022DiversityPayGapforfullcontext.For2022separatefiguresforeachemployingcompanyinscopearereported,ratherthanasingleaggregatedfigure.[P]Thedifferenceinaveragepaybetween"EthnicMinority"and"non-EthnicMinority"employeesisexpressedasapercentageofaverage"non-EthnicMinority"payfor"ShellintheUK",whichincludesShellEnergyRetailLimited.ItexcludesbonusesfollowingthesamemethodologyasourUKgenderpaygapreporting.PleasereadtheShellUK2022DiversityPayGapforfullcontext.For2022separatefiguresforeachemployingcompanyinscopearereported,ratherthanasingleaggregatedfigure.[Q]ResponserateforShellPeopleSurveywas87%in2022;83%in2021;86%in2020;85%in2019.Humanrights20222021202020192018IpiecaSASBGRIChildlabour(%countrieswithproceduresinplace)100100100100100SOC-4EM-EP-210a.3.408-1Ownoperations100100100100100SOC-4EM-EP-210a.3.408-1ContractorsandsuppliersForcedlabour(%countrieswithproceduresinplace)100100100100100SOC-2EM-EP-210a.3409-1Ownoperations100100100100100SOC-2EM-EP-210a.3409-1ContractorsandsuppliersDataobtainedfromaninternalsurveycompletedbytheseniorShellrepresentativeineachcountry.85ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesContractingandprocurement20222021202020192018IpiecaSASBGRIEstimatedexpenditureongoodsandservicesinlower-incomecountries5.04.24.55.74.1SOC-14–204-1($billion)[A][B][A]Estimatedexpenditureincountrieswheregrossnationalincomeamountstolessthan$15,000ayearperperson(source:UNDevelopmentProgramme'sHumanDevelopmentIndex2021).[B]ThisfigureonlyincludestheamountspentongoodsandservicesbyShellGroupcompanies.Socialinvestment[A]20222021202020192018IpiecaSASBGRIEstimatedvoluntarysocialinvestment(equityshare)($million)18294156116113SOC-13–203-192728784102SOC-13–203-1Estimatedsocialinvestmentspend(equityshare)inlower-incomecountries($million)[B][A]Socialinvestmentspendingvariesfromyeartoyeardependingonbusinessclimate,locationsandtypesofactivitiesunderway.Thisisvoluntarysocialinvestmentanddoesnotincludesocialinvestmentsmadethroughcontractualagreementswithhostgovernments,voluntaryworkbyShellemployeesordonationsofequipment.[B]Estimatedvoluntarysocialinvestmentspendingincountrieswheregrossnationalincomeamountstolessthan$15,000ayearperperson(source:UNDevelopmentProgramme'sHumanDevelopmentIndex2021).Socialinvestmentandcontractingandprocurementdatacollectedviaourfinancialsystem.Taxandotherpaymentstogovernments20222021202020192018IpiecaSASBGRIGOV-4–201-1Totaltaxespaidandcollected($billion)68.258.747.361.364.1GOV-4–201-1Corporateincometaxes13.46.03.47.810.1GOV-4–201-1Royalties8.26.63.55.95.8GOV-4–201-1Exciseduties,salestaxesandsimilarlevies46.246.147.648.2GOV-4–201-1Totalotherpaymentstogovernments($billion)17.912.840.412.517.9GOV-4–201-1Productionentitlements15.110.58.210.314.3GOV-4–201-1Bonuses0.220.1570.30.9GOV-4–201-1Fees2.62.11.92.70.021.2MoreinthisreportOurPoweringProgresstargetsSafetydataLetterfromtheCEOMoreonShellwebsitesPoweringProgress–transitioningtonet-zeroemissions86ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesCautionarynoteThecompaniesinwhichShellplcdirectlyandindirectlyownsinvestmentsareseparatelegalentities.Inthisreport"Shell","ShellGroup"and"Group"aresometimesusedforconveniencewherereferencesaremadetoShellplcanditssubsidiariesingeneral.Likewise,thewords"we","us"and"our"arealsousedtorefertoShellplcanditssubsidiariesingeneralortothosewhoworkforthem.Thesetermsarealsousedwherenousefulpurposeisservedbyidentifyingtheparticularentityorentities."Subsidiaries","Shellsubsidiaries"and"Shellcompanies"asusedinthisreportrefertoentitiesoverwhichShellplceitherdirectlyorindirectlyhascontrol.EntitiesandunincorporatedarrangementsoverwhichShellhasjointcontrolaregenerallyreferredtoas"jointventures"and"jointoperations",respectively."Jointventures"and"jointoperations"arecollectivelyreferredtoas"jointarrangements".EntitiesoverwhichShellhassignificantinfluencebutneithercontrolnorjointcontrolarereferredtoas"associates".Theterm"Shellinterest"isusedforconveniencetoindicatethedirectand/orindirectownershipinterestheldbyShellinanentityorunincorporatedjointarrangement,afterexclusionofallthird-partyinterest.Forward-lookingstatementsThisreportcontainsforward-lookingstatements(withinthemeaningoftheU.S.PrivateSecuritiesLitigationReformActof1995)concerningthefinancialcondition,resultsofoperationsandbusinessesofShell.Allstatementsotherthanstatementsofhistoricalfactare,ormaybedeemedtobe,forward-lookingstatements.Forward-lookingstatementsarestatementsoffutureexpectationsthatarebasedonmanagement’scurrentexpectationsandassumptionsandinvolveknownandunknownrisksanduncertaintiesthatcouldcauseactualresults,performanceoreventstodiffermateriallyfromthoseexpressedorimpliedinthesestatements.Forward-lookingstatementsinclude,amongotherthings,statementsconcerningthepotentialexposureofShelltomarketrisksandstatementsexpressingmanagement’sexpectations,beliefs,estimates,forecasts,projectionsandassumptions.Theseforward-lookingstatementsareidentifiedbytheiruseoftermsandphrasessuchas"aim","ambition","anticipate","believe","could","estimate","expect","goals","intend","may","milestones","objectives","outlook","plan","probably","project","risks","schedule","seek","should","target","will"andsimilartermsandphrases.ThereareanumberoffactorsthatcouldaffectthefutureoperationsofShellandcouldcausethoseresultstodiffermateriallyfromthoseexpressedintheforward-lookingstatementsincludedinthisreport,including(withoutlimitation):(a)pricefluctuationsincrudeoilandnaturalgas;(b)changesindemandforShell’sproducts;(c)currencyfluctuations;(d)drillingandproductionresults;(e)reservesestimates;(f)lossofmarketshareandindustrycompetition;(g)environmentalandphysicalrisks;(h)risksassociatedwiththeidentificationofsuitablepotentialacquisitionpropertiesandtargets,andsuccessfulnegotiationandcompletionofsuchtransactions;(i)theriskofdoingbusinessindevelopingcountriesandcountriessubjecttointernationalsanctions;(j)legislative,judicial,fiscalandregulatorydevelopmentsincludingregulatorymeasuresaddressingclimatechange;(k)economicandfinancialmarketconditionsinvariouscountriesandregions;(l)politicalrisks,includingtherisksofexpropriationandrenegotiationofthetermsofcontractswithgovernmentalentities,delaysoradvancementsintheapprovalofprojectsanddelaysinthereimbursementforsharedcosts;(m)risksassociatedwiththeimpactofpandemics,suchastheCOVID-19(coronavirus)outbreak;and(n)changesintradingconditions.Noassuranceisprovidedthatfuturedividendpaymentswillmatchorexceedpreviousdividendpayments.Allforward-lookingstatementscontainedinthisreportareexpresslyqualifiedintheirentiretybythecautionarystatementscontainedorreferredtointhissection.Readersshouldnotplaceunduerelianceonforward-lookingstatements.AdditionalriskfactorsthatmayaffectfutureresultsarecontainedinShellplc’sForm20-FfortheyearendedDecember31,2022(availableatwww.shell.com/investorandwww.sec.gov).Theseriskfactorsalsoexpresslyqualifyallforward-lookingstatementscontainedinthisreportandshouldbeconsideredbythereader.Eachforward-lookingstatementspeaksonlyasofthedateofthisreport,March28,2023.NeitherShellplcnoranyofitssubsidiariesundertakeanyobligationtopubliclyupdateorreviseanyforward-lookingstatementasaresultofnewinformation,futureeventsorotherinformation.Inlightoftheserisks,resultscoulddiffermateriallyfromthosestated,impliedorinferredfromtheforward-lookingstatementscontainedinthisreport.Shell’sNetCarbonIntensityAlso,inthisreportwemayrefertoShell’s"NetCarbonIntensity",whichincludesShell’scarbonemissionsfromtheproductionofourenergyproducts,oursuppliers’carbonemissionsinsupplyingenergyforthatproductionandourcustomers’carbonemissionsassociatedwiththeiruseoftheenergyproductswesell.Shellonlycontrolsitsownemissions.TheuseofthetermShell’s"NetCarbonIntensity"isforconvenienceonlyandnotintendedtosuggesttheseemissionsarethoseofShellplcoritssubsidiaries.Shell’snet-zeroemissionstargetShell’soperatingplan,outlookandbudgetsareforecastedforaten-yearperiodandareupdatedeveryyear.Theyreflectthecurrenteconomicenvironmentandwhatwecanreasonablyexpecttoseeoverthenexttenyears.Accordingly,theyreflectourScope1,Scope2andNCItargetsoverthenexttenyears.However,Shell’soperatingplanscannotreflectour2050net-zeroemissionstargetand2035NCItarget,asthesetargetsarecurrentlyoutsideourplanningperiod.Inthefuture,associetymovestowardsnet-zeroemissions,weexpectShell’soperatingplanstoreflectthismovement.However,ifsocietyisnotnetzeroin2050,asoftoday,therewouldbesignificantriskthatShellmaynotmeetthistarget.OtherbusinesstargetsPortfolioallocationaffectsourabilitytodeliverontargetswehavemade,andsocio-economic,politicalandmarketfactorssometimeschangeouroutlooks.Existingglobaltargetsarecurrentlyunderreview.Whilenodecisionshavebeenmade,toensureourtransitiontoanet-zeroenergybusinessisprofitable,itislikelysomebusinessKPItargetsmayberetired,aspartofnormalstrategyevolutionandmindfulofexistingcapitalallocationinthelatestOperatingPlan.WeexpecttoprovidefurtherinsightsduringourCapitalMarketsDayinJune2023.AlltargetspresentedatCapitalMarketsDayinJunewillbefiledwiththeSEC.Forward-lookingnon-GAAPmeasuresThisreportmaycontaincertainforward-lookingnon-GAAPmeasuressuchascashcapitalexpenditureanddivestments.Weareunabletoprovideareconciliationoftheseforward-lookingNon-GAAPmeasurestothemostcomparableGAAPfinancialmeasuresbecausecertain87ShellSustainabilityReport2022SustainabilityatAchievingnet-zeroGeneratingOurperformanceShellshareholdervaluedataOurcorevaluesemissionsRespectingnaturePoweringlivesinformationneededtoreconcilethoseNon-GAAPmeasurestothemostcomparableGAAPfinancialmeasuresisdependentonfutureeventssomeofwhichareoutsidethecontrolofShell,suchasoilandgasprices,interestratesandexchangerates.Moreover,estimatingsuchGAAPmeasureswiththerequiredprecisionnecessarytoprovideameaningfulreconciliationisextremelydifficultandcouldnotbeaccomplishedwithoutunreasonableeffort.Non-GAAPmeasuresinrespectoffutureperiodswhichcannotbereconciledtothemostcomparableGAAPfinancialmeasurearecalculatedinamannerwhichisconsistentwiththeaccountingpoliciesappliedinShellplc’sconsolidatedfinancialstatements.Thecontentsofwebsitesreferredtointhisreportdonotformpartofthisreport.Wemayhaveusedcertainterms,suchasresources,inthisreportthattheUnitedStatesSecuritiesandExchangeCommission(SEC)strictlyprohibitsusfromincludinginourfilingswiththeSEC.InvestorsareurgedtoconsidercloselythedisclosureinourForm20-F,FileNo1-32575,availableontheSECwebsitewww.sec.gov.AdditionalinformationAsusedinthisReport,"Accountable"isintendedtomean:requiredorexpectedtojustifyactionsordecisions.TheAccountablepersondoesnotnecessarilyimplementtheactionordecision(implementationisusuallycarriedoutbythepersonwhoisResponsible)butmustorganisetheimplementationandverifythattheactionhasbeencarriedoutasrequired.ThisincludesobtainingrequisiteassurancefromShellcompaniesthattheframeworkisoperatingeffectively."Responsible"isintendedtomean:requiredorexpectedtoimplementactionsordecisions.EachShellcompanyandShell-operatedventureisresponsibleforitsoperationalperformanceandcompliancewiththeShellGeneralBusinessPrinciples,CodeofConduct,StatementonRiskManagementandRiskManual,andStandardsandManuals.ThisincludesresponsibilityfortheoperationalisationandimplementationofShellGroupstrategiesandpolicies.CO2compensationdoesnotimplythatthereisnoenvironmentalimpactfromtheproductionanduseoftheproductasassociatedemissionsremainintheatmosphere.CO2compensationisnotasubstituteforswitchingtolower-emissionenergysolutionsorreducingtheuseoffossilfuels.Shellbusinessesfocusfirstonemissionsthatcanbeavoidedorreducedandonlythen,compensatetheremainingemissions."Carbonneutral"or"CO2compensated"indicatesthatShellwillengageinatransactionwhereanamountofCO2equivalenttothevalueoftheremainingCO2eemissionsassociatedwiththerawmaterialextraction,transport,production,distributionandusage/end-of-life(ifLubricantsorothernon-energyproduct)oftheproductarecompensatedthroughthepurchaseandretirementofcarboncreditsgeneratedfromCO2compensationprojects.Althoughthesecarboncreditshavebeengeneratedinaccordancewithinternationalcarbonstandards,thecompensationmaynotbeexact.CO2e(CO2equivalent)referstoCO2,CH4,N2O.88ShellSustainabilityReport2022Checkourlatestnews@ShellFollow@ShellonTwitterwww.facebook.com/shelllinkedin.com/company/shellAllourreportsareavailableonlineatShell.com/annual-publications■Comprehensivefinancialinformationonouractivitiesthroughout2022■DetailedinformationonShell’staxes■Updateonourclimateandenergytransitionlobbying■ReportonhowShellhasprogressedwithitsenergytransition

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