What were the reasons for the strategic decision to merge the two companies? Our strategy in action: Creating the culture and organization to deliver We have made significant progress in changing our culture and organization to ensure that we can deliver our strategy. The unification of the parent companies under Royal Dutch Shell plc in 2005 has provided us with a clearer, simpler, more efficient and accountable form of governance.

The chief executive now reports to a single board comprising 10 non-executive directors and five executive directors and a key advantage of this single, smaller board is that it provides a very clear and direct line of accountability to shareholders. Royal Dutch Shell now has a single headquarters in The Hague

(the Netherlands). The centralization of a number of activities in the headquarters is helping to reduce duplication and helping us to operate in a more streamlined and efficient way.

The structural changes are also helping to reinforce our work to simplify and standardize many of our business processes. In particular, the integration of the oil products and chemicals businesses into one downstream organization has so far been very successful in creating a more dynamic, responsive and effective organization. We have seen particular benefits at sites which contain both refineries and chemicals manufacturing plants.

By sharing services and integrating their activities we can operate much more efficiently. It also means we have been able to share and adopt best practice more quickly and so improve operational performance