Tobolsk, Through the Prism of the Sdgs
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TOGETHER WE ARE STRONG Sustainability Report 2018 Sustainable development as a priority. SIBUR’s contribution to reaching the UN Sustainable Development Goals With every year that passes, SIBUR has been increasingly paying very close attention to various aspects of sustainable development. The Company sets great store on continuously improving the quality of its products and on strengthening the loyalty of its customers, both direct and indirect alike. We want to keep them abreast of our progress, whether it is how we perform financially, or what we do to help preserve our environment and to enhance the social fabric of our communities. To that end, the Company has been publishing, since 2016, its annual sustainability reports that aim to address those relevant trends that affect both our industry and our society at large. The focus of the 2017 Report was on industry digitalization, a very visible trend that has risen to prominence over the last several years. Digital transition is, indeed, an essential factor of the so-called “new economy”, but it is not the only one. Arguably, a general outline of today’s world and its development course were set out in the United Nations’ framework of what is traditionally perceived as the underpinnings of sustainable development – economic efficiency, social welfare, and environmental security, and concisely summarized as the 2030 Sustainable Development Goals (SDGs) . The thrust of the SDGs is to eliminate existing inequalities in various areas, while preserving the environmental and social equilibrium, and creating new opportunities for all social groups. Governments, private businesses, NGOs, and other national and international actors have been actively pursuing the SDGs since 2015. The signing and implementation of the Paris Agreement seeking to combat climate change and limit the increase in global average temperature is one notable example of such concerted international action. In addition, other international campaigns and programs are being conducted to combat poverty and famine, to preserve water resources, to eliminate gender inequality, etc. Russian companies have been getting increasingly more involved in taking ownership of the SDGs and making them a part of their own business strategies. A survey conducted in 2018 by UN Global Compact Russia involving some of Russia’s largest businesses including SIBUR, stated that “there has been, without a question, substantial progress demonstrated by Russian businesses in gaining appreciation of how they could contribute to sustainable development across a range of themes, either conceptually (prioritizing implementation of the SDGs, identifying areas of focus, managing motivation, expectations, etc.), via management structure modifications (as management systems get transformed in response to sustainability challenges with responsibility for this area getting escalated to higher tiers of management, etc.), or with regard to finance and investment policies (by acknowledging that the benefit of getting on board with the international agenda is not only in reducing risk-associated costs but also in acting as a factor that could make a business more attractive to investors and help it gain financial preferences, etc.)”. By treating the SDGs as its strategic guide, SIBUR’s management is capable of setting realistic and achievable goals with due consideration for the Company’s business interests. This report contains information on what has already been done in all relevant areas, what results were achieved in 2018, and what targets have been set for the subsequent year. On 1 January 2016, the 17 Sustainable Development Goals (SDGs) of the 2030 Agenda for Sustainable Development, adopted by world leaders in September 2015 at an historic UN Summit, officially came into force. For more information visit: https://www.un.org/sustainabledevelopment/ ru/sustainable-development-goals/ “Sustainable Development. Role of Russia” Survey: http://www.globalcompact.ru/upload/iblock/376/Itogi-oprosa_broshyura.pdf www.sibur.ru 01 02 03 04 05 06 01 CONTENTS ABOUT THIS REPORT 02 05 HUMAN CAPITAL 98 MESSAGE FROM THE CHAIRMAN 04 Contribution to Achieving SDGs 100 OF SIBUR’S MANAGEMENT BOARD 2018 Targets vs. Performance 101 01 THE COMPANY 06 Policy and Management 103 Business Strategy 08 Development of SIBUR’s Production System 105 The Company’s Structure of Business 09 in the Year under Review Location of Operations in 2018 11 Interactions with Stakeholders: Key Issues 106 The Company on the Market: Position and 12 in 2018 Competitive Advantages Workforce Structure: Key Facts 107 2018 Performance Highlights 14 Staff Costs and the Remuneration System 108 Social Support for the Personnel 109 02 STRATEGY OF THE COMPANY’S 16 Activities and Results 112 DEVELOPMENT Training and Development 114 Strategy of the Company’s Development 18 Building the Talent Pipeline 117 and Sustainable Development Matters Trade Union Activities 119 Corporate Governance 19 Public Recognition 120 Risk Management 21 2019 Targets 121 Ethics and Anti-corruption 24 Supply Chain 26 06 CONTRIBUTION TO THE 122 Communications Policy 27 DEVELOPMENT OF LOCAL Interactions with Stakeholders 28 COMMUNITIES 2019 Targets 31 Contribution to Achieving SDGs 124 2018 Targets vs. Performance 125 03 VALUE CREATION 32 Policy and Management 127 Contribution to Achieving SDGs 34 Interaction with Stakeholders: Key Issues 128 2018 Targets vs. Performance 35 in 2018 Generated and Distributed Economic Value 37 Actions and Results 130 Operational Sites and Implementation of the 38 Evaluation of Project Effectiveness 135 Investment Program in 2018 Public Recognition 137 Innovations 40 2019 Targets 139 The Policy of Customer Centricity and Its 43 Implementation in 2018 ANNEXES 140 Digital Transformation 45 Annex 1. Glossary of Terms 140 Public Recognition 47 Annex 2. The Matrix of Material Topics 142 2019 Targets 49 Annex 3. Additional Data on Occupational 143 Health and Safety 04 SAFE PRODUCTION 50 Annex 4. Employee Statistics 146 Health and Safety Requirements for Suppliers 53 Annex 5. Table of GRI Disclosures 154 and Contractors Annex 6. Independent Assurance Review 161 Occupational Health and Safety 55 Certificate Environmental protection 68 Contact Details 163 Energy efficiency 89 Sustainability Report 2018 02 About this Report The 2018 Sustainable Development Report of PJSC SIBUR Holding and its subsidiaries (hereinafter collectively referred to as SIBUR, or the Company) intends to provide all interested parties with information about SIBUR’s activities in the area of sustainable development. GRI 101, 102-1 The Company’s strategy, policies, of material importance. In 2018, SIBUR’s governance principles, its key areas primary focus was on entering the final of focus and achievements in the areas stage of completing its major investment of economic performance, environment project to build ZapSibNeftekhim, a state-of- and social development are presented here the-art petrochemicals complex in Tobolsk, through the prism of the SDGs. The Report on producing new types of products and was compiled giving proper consideration materials, forging reliable partnerships, to the criteria set out in Sustainable and on implementing public interest projects Reporting Standards (GRI SRS) for the Core in the regions where the Company operates. reporting option, in conformity with the Social Charter of the Russian Business, and Throughout the year, the Company in line with the requirements of enquiries maintained regular interactions with made by analytical and rating agencies. its external stakeholders using a variety of communication channels. The most All output figures and financial performance material issues raised by the stakeholders numbers provided herein are reported with respect to the economic, social and in accordance with the Company’s environmental aspects of SIBUR’s operations management reports and financial in 2018 are reflected in relevant sections statements. The scope of the Report of the Report. has not changed since 2017. For the purpose of preparing this The Company’s 2019, medium-term and Report, an ad hoc survey was conducted long-term targets quoted in relevant sections among a larger group of the Company’s of the Report are provided for projection stakeholders asking them to rate on purposes only, and as such, the likelihood a scale of 1 to 5 the importance of the of them being achieved may be affected by Company’s various efforts in the area a multitude of circumstances many of which of sustainable development. This Report are beyond the Company’s control. As a result, was prepared with due consideration the actual performance results may turn out given to the recommendations provided to be different from the projected values. by the Council on non-financial reporting at the Russian Union of Entrepreneurs and The primary content of the Report is Industrialists (the RSPP) during the process reflective of the themes and issues that of public assurance of the Company’s 2017 the Company and its stakeholders find to be Sustainability Report. The scope of this Report covers 2018 activities of See pages 28, 58, 73, 106, 128, 142.. PJSC SIBUR Holding and its subsidiaries with SIBUR’s Survey results are provided on pages 24, 26, 40, 53, stake of 50% or more, conducted within the Russian 58, 73, 93, 106, 128. Federation For further details please refer to Annex 2 to this Report, page 142. Sustainability Report 2018 www.sibur.ru/en/ 01 02 03 04 05 06 03 KEY RECOMMENDATIONS OF THE RSPP’S COUNCIL ON