Transneft is fully aware of the importance of consistent work and improving information disclosure in the field of sustainable development.
To mitigate the risks of the Company's activities in the field of environmental, social, and corporate governance aspects, the management carries out active work to develop and improve existing sustainability practices and information disclosure.
For quick search for reports, policies and indicators, we recommend using “Quick Reference ESG Databook for Transneft Group” with built-in links:
To mitigate the risks of the Company's activities in the field of environmental, social, and corporate governance aspects, the management carries out active work to develop and improve existing sustainability practices and information disclosure.
For quick search for reports, policies and indicators, we recommend using “Quick Reference ESG Databook for Transneft Group” with built-in links:
- corporate governance improvement;
- energy saving;
- environmental impact reduction;
- enhancing social responsibility.
Reducing the Risks of Adverse Climate Change and Environmental Pollution
In the medium term, the main contribution to mitigating the risks of climate change and reducing environmental pollution will be achieved through:
- lower specific energy consumption in oil and petroleum products pumping by 0.5% a year within the period of 2022-2026, as a result of energy saving measures;
- maintaining the normal quality level of wastewater treatment as a result of implementation of a set of water conservation actions to ensure the technical condition of treatment facilities in full compliance with the requirements of environmental legislation.
Key ESG developments in 2021
As part of the ESG risk management and improvement efforts for sustainability information disclosure, the following actions were implemented in 2021:
- approval of key environmental performance targets:
- reduction of per-unit air pollutant emissions during oil and petroleum products transportation by 0.7%;
- ensuring zero dumping of insufficiently treated wastewater;
- at the same time, no incidents that caused significant environmental damage or fatalities were registered at the facilities of Transneft in 2021,
- in order to enhance the level of social responsibility and promote long-term and effective labour relations, the Company improves personnel management policy and implements measures, aimed at ensuring:
- stable, fair and decent salary level;
- social protection of employees, as well as corporate retirees (social benefits and compensation, housing provision, non-government pension plans);
- development, training and professional retraining of personnel;
- health protection and personal insurances of employees;
- workplace safety and reducing the risks of occupational injuries to employees;
- promotion of physical culture, mass sports, and encouraging healthy lifestyle within work communities.
- in terms of supporting the interests and values of broad social groups and communities, the Company completed in 2021, 37 projects under the targeted charity program, including:
- overhaul of the Neftyanik sports facility in Ukhta and the improvement of the Torpedo stadium in Saratov; construction of a cultural and leisure center in the village Sharkan (Udmurt Republic), construction of the Cathedral of St. Alexander Nevsky in Volgograd;
- modernizing the infrastructure of 12 small-sized schools in rural areas;
- renovating premises of the Therapeutic Building of the Samara State Medical University prepared for the reception of patients with COVID-19 in Samara;
- 9 projects have been completed (8 projects in the field of school education and 1 project in the field of healthcare) in the Far East region in 2021, in order to improve the living conditions of local communities under the corporate charitable program for the development of the social infrastructure;
- the Company continued to develop sustainability dialogue with the members of the investor community. Key trends in this area and the investors' proposals to improve sustainability information disclosure and practices were discussed with Transneft representatives and management,
- sustainability presentation materials and additional presentation on reducing environmental impact were published on the Company's website.
Dialogue with Specialised ESG Rating Agencies
We maintain a dialogue with the rating agencies specialising in analysis of companies' activities in the field of sustainable development. Key areas of discussion with ESG Rating agencies:
- disclosure of ESG indicators, answers to analysts’ questions;
- discussion of indicators calculation methods;
- analysis and comments on agencies publications;
- comments to agencies on events covered by the media.
In the reporting year, Transneft Group activities were analysed in detail by the largest and most reputable ESG rating agencies.
Transneft Sustainability Ratings
| Item No. | Agency | Transneft ESG Rating |
|---|---|---|
| 1 | Sustainalytics | Risk score 32.8 (high risk) (methodology change by ≈65% in 2021) |
| 2 | ISS | C-(raised in January 2021) |
| 3 | S&P CSA (previously – SAM) | 28 (raised in November 2021) |
| 4 | FTSE | 2.7 |
| 5 | Bloomberg | 40.1 |
| 6 | Refinitiv | С+ (see “ESG score” in terminal) (revision of scale limits in 2021) |
| 7 | RAEX-Europe | B - rating band |
In recognition of successful application of the best sustainability practices complying with internationally accepted standards, Transneft preferred shares in 2019 were included in the FTSE4Good index, calculated by the FTSE agency and which is used as a benchmark for composition of investment portfolios by ESG investors.
On the results of the index review in June 2021, Transneft preferred shares remained in the index. However, due to the revision of the boundaries of inclusion in the index of the companies from the oil and gas sector, the agency warned about the possible exclusion of Transneft preferred shares from the index in the future.
Based on the Company’s performance in 2021, ISS and S&P CSA ESG-agencies raised Transneft ratings.
On the results of the index review in June 2021, Transneft preferred shares remained in the index. However, due to the revision of the boundaries of inclusion in the index of the companies from the oil and gas sector, the agency warned about the possible exclusion of Transneft preferred shares from the index in the future.
Based on the Company’s performance in 2021, ISS and S&P CSA ESG-agencies raised Transneft ratings.
ESG performance
ESG Development Plans
The Company plans to provide and disclose information on sustainability to investors, analysts, ESG agencies and other stakeholders considering the current Russian regulation on the disclosure of non-financial indicators amid increasing regulatory authorities’ attention to the disclosure of information on sustainable development.
The Company plans to provide the investor community and other stakeholders with detailed information about the results of activities in the field of sustainable development, and review the proposals received on the results of discussion of sustainability-related matters with the investor community members and stakeholders.
The Company plans to develop a strategy for managing greenhouse gas emissions as part of ongoing research activity, along with continual improvement of the sustainability information disclosure.
In the area of corporate governance, an external assessment of the Board of Directors will be held in 2022 (planned postponement of the event to 2022 due to the pandemic).
According to the corporate charitable program for the development of social infrastructure in 2022, it is planned to finance the repair of the Morozov Children's City Clinical Hospital, to continue the overhaul financing of the medical and obstetric station’s premises for the Seltinskaya District Hospital of the Udmurt Republic.
In addition, according to the approved Program for the Development of the Social Infrastructure of the Far East Region in 2022, funding is provided for the repair and equipping of 7 educational institutions and 1 healthcare institution.
The Company plans to provide the investor community and other stakeholders with detailed information about the results of activities in the field of sustainable development, and review the proposals received on the results of discussion of sustainability-related matters with the investor community members and stakeholders.
The Company plans to develop a strategy for managing greenhouse gas emissions as part of ongoing research activity, along with continual improvement of the sustainability information disclosure.
In the area of corporate governance, an external assessment of the Board of Directors will be held in 2022 (planned postponement of the event to 2022 due to the pandemic).
According to the corporate charitable program for the development of social infrastructure in 2022, it is planned to finance the repair of the Morozov Children's City Clinical Hospital, to continue the overhaul financing of the medical and obstetric station’s premises for the Seltinskaya District Hospital of the Udmurt Republic.
In addition, according to the approved Program for the Development of the Social Infrastructure of the Far East Region in 2022, funding is provided for the repair and equipping of 7 educational institutions and 1 healthcare institution.
Policies for Sustainable Development implemented by Transneft in business operations
| Policy Description | Link |
|---|---|
| Energy Efficiency Policy | +(reference) |
| Industrial Waste Reduction Policy | + (SDR, page 172-173) |
| Water Resources Conservation Policy | + (SDR, pages 171-172) |
| Biodiversity Conservation Policy | + (SDR, pages 173-175) |
| Occupational Health and Safety Policy | +(reference) |
| Transneft personnel management policy aimed at training and development | +(reference) |
| Equal Opportunities Policy | + (SDR, page 21) |
| Anti-Corruption Policy | +(reference |
| Code of Ethics, Conflict Resolution Policy | +(reference) |
| Intellectual Property Protection Policy | + (SDR, pages 101-102) |
Note:
Transneft declares in its 2020 Sustainable Development Report (page 21) the compliance with the basic sustainable development principles in the field of labour relations, including:
- promotes equal opportunity in hiring and setting salaries (including persons with disabilities), and seeks to prevent all forms of discrimination and pressure in the workplace regardless of race, gender, nationality, language, origin, age, religion and sexual orientation, as well as property, family and social status and position;
- prohibits and prevents child labour;
- prohibits and prevents inhumane treatment of employees, use of forced and compulsory labour, violence against employees;
- ensures compliance with occupational health and industrial safety requirements;
- guarantees benefits for socially vulnerable groups in accordance with the law;
- observes labour law in relation to working hours and rest, keeps overtime working hours records (overwork);
- creates conditions for personal and professional growth of employees;
- provides a decent salary level;
- excludes the occurrence of discrimination of labour remuneration (salary) of the personnel, ensuring compliance with the Labour Code of the Russian Federation;
- respects the rights of employees to collective bargaining;
- respects the right to create labour unions and does not prevent employees from entering thereto;
- promotes the development of volunteering movement among employees.