Shell shocked by storm it should have forseen

ONE conclusion to be drawn from the Brent Spar affair is that Greenpeace is a more effective multinational than Shell. The comparison is not that far-fetched. Greenpeace operates in 30 countries, Shell in 100. Greenpeace has 3.8 million members around the world, Shell has 625,000 shareholders. Both are household names, both are managed by intelligent, committed people. But Greenpeace won and Shell was humiliated.

It's hard to disagree with the British Government view that Shell were wimps who lost their nerve. If they had gritted their teeth for another 24 hours, the oil storage platform would now probably be at the bottom of the ocean and the Greenpeace activists, helicopters, film crews and satellite link-ups would be pursuing their next target. The Brent Spar affair would be old news.

Shell picked the worst time to execute its astonishing U-turn. The company had already sustained an unprecedented bruising. Greenpeace protesters first boarded the platform on 30 April. Continental motorists had been boycotting Shell's filling stations for weeks. Chancellor Kohl's attack was more than a week old. Another day's brickbats would surely not have made much difference. And by timing the announcement of Plan B just hours after John Major had vigorously defended Plan A in the Commons, Shell made an enemy of its closest ally in the whole sorry affair.

The lack of judgement is all the more surprising from a company that prides itself on covering all the angles. Since the 1960s it has practised what it calls "scenario planning" - which means considering every eventuality, however far-fetched. It will look at the impact on the company if, say, the oil price plunged to $1 a barrel - or soared to $100. It is used to examining the potential effects of unlikely eventualities. Yet it seems to have overlooked the impact of an all-too-likely eventuality - that environmental groups would vigorously fight the first attempt to use the deep ocean as a dumping ground for oil industry hardware.

The environmental case was finely balanced. The unpalatable truth is that once you've created a 130-metre high structure of 14,000 tonnes and filled it with toxic sludge, it's an environmental hazard whatever you do with it. Dismantling it onshore could be just as polluting and dangerous as dispatching it to the ocean floor. Shell had good arguments to marshal. It signally failed to get them across.

The Brent Spar affair will doubtless become a case study pored over by MBA students and trainee spin doctors. It holds valuable lessons. One PR man last week likened the public mood of disenchantment to static electricity: the charge is constantly looking for a point to run to earth - it could be animal welfare, British Gas, the environment, anything. All corporations are vulnerable. The trick is to avoid being the next lightning conductor.