Integrating the SDGs in Extractive Industry Company Strategies - - PowerPoint PPT Presentation

SLIDE 1

Integrating the SDGs in Extractive Industry Company Strategies

April 2018

SLIDE 2

CCSI has been working at 3 levels

Sector Corporate Project

Oil & Gas Major from Europe Gold/copper project in Chile Oil & gas operations in country

SLIDE 3

S Activities S Strategic business plan S Operational guidelines S Incentives

S

Key performance indicators (KPIs)

S

CEO sustainability guidelines

S

Management by Objectives Assessments

Framework

Corporate level: Map activities, strategy & incentives to the SDGs

MAPPING THE OIL AND GAS INDUSTRY TO THE SUSTAINABLE DEVELOPMENT GOALS L

• c

a l D e v e l

• p

m e n t Climate Change Energy Access Alignment of Activities C l i m a t e C h a n g e Shared-Use Infrastructure H e a l t h I m p a c t A s s e s s m e n t s Road Safety Worker & Community Protection Local Content Strategy Workforce Education Technology Training Gender-Sensitive Policies I n c l u s i v e D e c i s i

• n
• M

a k i n g W

• m

e n ’ s E m p l

• y

m e n t O p p

• r

t u n i t i e s Water Strategy Water Use Effjciency Water Risk Management Natural Gas Energy Effjciency A l t e r n a t i v e E n e r g i e s Skills Assessment Local Employment W

• r

k f

• r

c e & S u p p l i e r D e v e l

• p

m e n t S u s t a i n a b l e I n f r a s t r u c t u r e Shared Use Infrastructure Technology Transfer Impact Assessments Transparency Engagement C u l t u r a l & N a t u r a l H e r i t a g e P r

• t

e c t i

• n

Operational Risk Assessment S u s t a i n a b l e U r b a n i z a t i

• n

E ffj c i e n t W a s t e M a n a g e m e n t S u p p l y C h a i n S u s t a i n a b i l i t y Product Stewardship Resilience & Adaptive C a p a c i t y Emissions Mitigation Strategic Planning A c c i d e n t P r e v e n t i

• n

& R e s p

• n

s e Environmental Assessments O c e a n A c i d i fj c a t i

• n

M i n i m i z a t i

• n

Ecosystem Management M i t i g a t i

• n

H i e r a r c h y Biodiversity Ofgsets Community Engagement Anti-Corruption Human Rights D i a l

• g

u e & C

• r

d i n a t i

• n

G

• v

e r n m e n t C a p a c i t y Sustainable Energy KEY ISSUE AREAS FOR OIL AND GAS MAPPED TO THE SDGs EXECUTIVE SUMMARY | ix

Analyze and Map

Source: IPIECA, IFC, UNDP

K P I

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Corporate level: Gap analysis based on priorities for an energy company primarily operating in Africa

• 1. At the core of an energy company operating in a

world that needs to decarbonize

• 2. Managing operations: safe and decent

conditions for workers and impacted communities

• 4. Supporting host

governments, particularly in institutionally weak countries

• 3. Managing operations:

Mitigating environmental impacts

Activities, KPIs, incentive systems, corporate governance should all align with and reflect these SDG priorities

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Corporate level: Mapping according to materiality

By materiality across value-chain

! Biofuels

?

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Project level: Align to Provincial Development Priorities

S Background:

S Project to make up 60% of GDP of province S Infrastructure to run through 4 municipalities S Significant impacts on infrastructure, housing and services

expected during construction phase

S Few job opportunities during operations S Previous large-scale projects stopped due to social opposition

S Opportunity:

S Help the Municipalities to create a long-term development plan

that takes into account the impacts of the mining investment

S Localize the SDG framework in development plan S Align company’s interventions and incentive mechanisms to

development plan

S Help secure social license to operate

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Project level: Baseline assessment

Commune 1 Commune 2 Commune 3 Commune 4 Province Region Chile SDG 1 SDG 2 SDG 3 SDG 4 SDG 5 SDG 6 SDG 7 SDG 8 SDG 9 SDG 15 SDG 16

OVERALL PERFORMANCE COMPARISON WITH OTHER DEVELOPMENT METRICS SDG DASHBOARD Index score Regional average score SDG Global rank

SDG Index and Dashboards Report 2017 Global Responsibilities

82

OECD Countries

++T+

77.7

GLOBAL RANK SCORE OR VALUE REGIONAL AVERAGE

GDP per capita, PPP (2015) Subjective Wellbeing (2016) Environmental Performance Index (2016) Human Development Index (2016) Global Competitiveness Index (2016/17) Global Peace Index (2016)

CHILE

++T+

71.6 44 (OF 157)

47/153 23/133 52/155 34/157 31/134 27/149 US$ 22,197 66.0 77.7 84.7 66.3 67.3 US$ 38,362 66 84.5 88.7 71.4 67.1

100 75 50 25 SDG 1 SDG 17 SDG 16 SDG 15 SDG 14 SDG 13 SDG 12 SDG 11 SDG 10 SDG 9 SDG 8 SDG 7 SDG 6 SDG 5 SDG 4 SDG 3 SDG 2

AVERAGE PERFORMANCE BY SDG

Chile

SDG Dashboard Chile SDG performance based on available statistics in region Opportunity to help with data collection during HESIA & setting up monitoring system for development plan

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Project level: Localizing the SDGs

1.

Introduce SDGs: Inclusive and participatory process to prioritize development

• utcomes

2.

Set the local SDG agenda: Ambitious yet realistic

3.

Plan for implementation: Goal- based targets backed by resources

4.

Monitor progress: Collecting the right data is key

Example

SLIDE 9

Relevant findings for ESG investing

Sector Corporate Project

S

SDG framework is data driven, so ESG investors will have more reference points.

S

There is a tradeoff between data collection that is standardized/comparable vs. useful for context specific development planning/monitoring

S

At the corporate level the incentive structure & allocation of budget provide good insights of what companies prioritize. Not necessarily # of initiatives or what is reported

S

There is a need to account for company lobbying in ESG matrices

S

At the project level there is a big opportunity of large-scale investments to work with local authorities to localize the SDGs

S

Company interventions should align to local development

• priorities. Need to think of ways how to account for that in ESG

matrices.

S

At the local level it becomes easier to measure the impacts of a project on the SDGs