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The closing off and lack of a diversified approach to solving energy problems also reveals the incapability or unwillingness of the CEO to think of the long ter

The closing off and lack of a diversified approach to solving energy problems also reveals the incapability or unwillingness of the CEO to think of the long term success of a corporation now singularly focused on the exploitation of a non-renewable, finite resource. They are now more focused and perhaps more profitable these quarters, but next FYs they will be more vulnerable to other competitors in the energy sector. Short-termism seems to be an unavoidable condition when markets demand higher efficiencies.

akho 3y ago
As an investor, I would very much prefer them to focus on what's profitable. I can invest my dividends/buyback cash into long-term successful renewable energy businesses, if that's what I want to be in. There's no need to have Shell make those decisions for me. Now, if there's a synergy in there — somewhere where an oil company is uniquely positioned to implement renewables — that would be nice. I'm not sure if any such thing exists.
- datavirtue 3y ago
  I'm starting to realize that wind farms are not profitable at all. GE has a good bit of that industry buttoned up but they are not pursuing it. There are other examples of companies walking away from it or avoiding it. It's not out of ideology, corporations scramble for profit.
- ShrimpHawk 3y ago
  If there were a company that turned literal murder into stock prices people would invest in it.
  - akho 3y ago
    There are hundreds of such companies, and some are quite hot. Your point?
  - akho 3y ago
    Also, oil/energy companies provide the foundation of modern technological civilization. We now see some downsides to that particular method, but “murder” is a jump of Olympic proportions.
  - angra_mainyu 3y ago
    Raytheon? Lockheed Martin?
- linsomniac 3y ago
  As a fellow investor, I started investing in RDS a couple years ago because I liked the opportunity for them using their oil war chest to springboard into renewables. Being an "energy company" rather than an "oil company". It's been doing pretty good, up 20%, but if they're just going to be another oil company, I'll probably put my money elsewhere.
  - akho 3y ago
    Why not ask them for the war chest money, and decide on your renewables allocation yourself? This whole “we're green now” approach is a very transparent plan of the management to remain in control of the “war chest”.
cinntaile 3y ago
Who is going to threaten them in the energy sector? Their main competitors are other fossil fuel giants with a similar strategy.
RetroTechie 3y ago
"Short-termism seems to be an unavoidable condition when markets demand higher efficiencies." That's not a market failure, but poorly chosen bonus / reward structure (from society's point of view). What if the bulk of CEO / board members' salaries & bonusses where structured as company share value, cashable no earlier than say, 20y from now? 'Pocket money' now for living expenses, a rich pension later if company does well long term. That would surely change the incentives. As opposed to "add short-term share value, cash cheque, jump ship" as seems usual for CEOs these days. Also it depends on whether Shell defines itself as oil company, or energy company. "Oil company"? Ok. No need to expect much from them concerning the energy transition. 1.5% of overall expenditure didn't match with "Shell continues its path as a leader in the energy transition" anyway. Personally I think oil companies have a shrinking time window in which they'll continue to be profitable. After which market conditions & politics have changed, assets will be restructured, and (mostly small) shareholders + society at large will be left holding the bag. If you happen to be one of them: get out before the big boys do! Your funds are better used elsewhere.
- A_non_e-moose 3y ago
  > What if the bulk of CEO / board members' salaries & bonusses where structured as company share value, cashable no earlier than say, 20y from now? 'Pocket money' now for living expenses, a rich pension later if company does well long term. Pretty interesting concept actually! Much like stock as a golden cage retainer for tech workers. Who would have to be lobbied for that to go ahead?

akho 3y ago

As an investor, I would very much prefer them to focus on what's profitable. I can invest my dividends/buyback cash into long-term successful renewable energy businesses, if that's what I want to be in. There's no need to have Shell make those decisions for me. Now, if there's a synergy in there — somewhere where an oil company is uniquely positioned to implement renewables — that would be nice. I'm not sure if any such thing exists.

datavirtue 3y ago
I'm starting to realize that wind farms are not profitable at all. GE has a good bit of that industry buttoned up but they are not pursuing it. There are other examples of companies walking away from it or avoiding it. It's not out of ideology, corporations scramble for profit.
ShrimpHawk 3y ago
If there were a company that turned literal murder into stock prices people would invest in it.
- akho 3y ago
  There are hundreds of such companies, and some are quite hot. Your point?
- akho 3y ago
  Also, oil/energy companies provide the foundation of modern technological civilization. We now see some downsides to that particular method, but “murder” is a jump of Olympic proportions.
- angra_mainyu 3y ago
  Raytheon? Lockheed Martin?
linsomniac 3y ago
As a fellow investor, I started investing in RDS a couple years ago because I liked the opportunity for them using their oil war chest to springboard into renewables. Being an "energy company" rather than an "oil company". It's been doing pretty good, up 20%, but if they're just going to be another oil company, I'll probably put my money elsewhere.
- akho 3y ago
  Why not ask them for the war chest money, and decide on your renewables allocation yourself? This whole “we're green now” approach is a very transparent plan of the management to remain in control of the “war chest”.

cinntaile 3y ago

Who is going to threaten them in the energy sector? Their main competitors are other fossil fuel giants with a similar strategy.

RetroTechie 3y ago

"Short-termism seems to be an unavoidable condition when markets demand higher efficiencies." That's not a market failure, but poorly chosen bonus / reward structure (from society's point of view). What if the bulk of CEO / board members' salaries & bonusses where structured as company share value, cashable no earlier than say, 20y from now? 'Pocket money' now for living expenses, a rich pension later if company does well long term. That would surely change the incentives. As opposed to "add short-term share value, cash cheque, jump ship" as seems usual for CEOs these days. Also it depends on whether Shell defines itself as oil company, or energy company. "Oil company"? Ok. No need to expect much from them concerning the energy transition. 1.5% of overall expenditure didn't match with "Shell continues its path as a leader in the energy transition" anyway. Personally I think oil companies have a shrinking time window in which they'll continue to be profitable. After which market conditions & politics have changed, assets will be restructured, and (mostly small) shareholders + society at large will be left holding the bag. If you happen to be one of them: get out before the big boys do! Your funds are better used elsewhere.

A_non_e-moose 3y ago
> What if the bulk of CEO / board members' salaries & bonusses where structured as company share value, cashable no earlier than say, 20y from now? 'Pocket money' now for living expenses, a rich pension later if company does well long term. Pretty interesting concept actually! Much like stock as a golden cage retainer for tech workers. Who would have to be lobbied for that to go ahead?