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Sustainability Report NON-FINANCIAL REPORT for 2017 / ZAGREB HOLDING GROUP

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Sustainability Report NON-FINANCIAL REPORT for 2017 / ZAGREB HOLDING GROUP Sustainability at the Heart of the Company Sustainability at the Heart Sustainability at the Heart of the Company Sustainability Report NON-FINANCIAL REPORT FOR 2017 / ZAGREB HOLDING GROUP Sustainability Report NON-FINANCIAL REPORT FOR 2017 ZAGREB HOLDING GROUP Publishing Sustainability at the Heart Details of the Company Publisher Zagreb Holding Ltd. Ulica grada Vukovara 41, 10000 Zagreb www.zgh.hr For the Publisher Management Board Assistance Department This Report was compiled with the participation of work teams from professional services of the Head Office and all members of Zagreb Holding Group. Reporting Advisors Hauska & Partner Graphic Design Bestias Print Institution for Vocational Rehabilitation and Employment of Persons with Disabilities - URIHO Zagreb Contact person for inquiries about the Report Ksenija Pešl Management Board Assistance Department E-mail: [email protected] This Report may be found at www.zgh.hr Sustainability Report NON-FINANCIAL REPORT FOR 2017 ZAGREB HOLDING GROUP Zagreb Holding Group Sustainability Report for 2017 4 Table of Contents 5 Table of Contents 1. 2. 3. 2017 in Letter by the President Zagreb Holding Review of the Management Board Profile >10 >14 >18 4. 5. 6. 7. 8. 9. 10. Governance Strategy and Relevant Value Challenges of Urban Inside Zagreb Projects and Objectives Issues Creation Environmental Holding Innovations Protection for Zagreb >32 >46 >54 >64 >88 >108 >124 Ethical Conduct and Analysis of Material Issues Main Financial Identified Environmental Collective Bargaining Partnerships and Socially Transparency Sustainability in >56 Indicators for 2017 Risks >110 Relevant Projects >37 the Foundation of Stakeholders of >65 >90 Employment Policy >125 Anti-corruption Efforts Business Strategy Zagreb Holding Project Planning, Financing Sustainable Waste and Equal Rights Culture and Urban >40 >47 >57 and Management Management >111 Development Governance Systems in >66 >91 Salaries and >130 Subsidiaries and Affiliates Capital Projects Water Pumping Remunerations >41 >66 and Discharge >114 Projects We Participate in, Financial Sustainability >97 Employees’ Health Follow and Support... >67 Energy Consumption and Safety >41 and Initiatives for Energy >115 11. Co-funded Projects Voluntary External and Activities Consumption Reduction Professional Development Report Profile and Initiatives >67 >101 and Education List of Indicators >42 Other Subsidised Activities Fuel Consumption >118 Memberships >68 and Emissions Zagreb Holding Group >104 >43 Competition in Numbers >69 >120 >136 Modern Infrastructure and Services >69 Projects Implemented by Subsidiaries >71 Cooperation with Suppliers >75 Development of Services and Communication with Customers >78 Customer Satisfaction >83 Zagreb Holding Group Sustainability Report for 2017 6 Chapter 5 Strategy and Objectives 7 Daily Analyses of Sustainability Requirements Zagreb Holding recognises continuity and acceptable prices and aims to provide as many additional advantages to service users as possible, as those are some of the key issues for achieving positive and eliminating negative influence. Value creation is analysed not only in the financial, but also in the environmental and social dimension. Zagreb Holding Group Sustainability Report for 2017 8 Chapter 5 Strategy and Objectives 9 1 / 2017 in Review Zagreb Holding Group Sustainability Report for 2017 10 Chapter 1 2017 in Review 11 2017 in Review Quantity of water distributed 57,885,402 Number of sold m3 ride tickets Structure Number of containers 31,180,587 1.1 million for separate waste collection Number 16 of service 85,515 subsidiaries users Number of “recycling islands” 683 Number of recycling centres 8 1 15 companies institution Kilometres of maintained roads 2,500 Number of maintained playgrounds Surface area of 735 maintained park 2017 areas 11,705,855 Surface area of 2 cleaned public m 11,286 traffic areas Number 1,106,869,100 Quantity of 2 distributed of employees m natural gas (ZGH Group) 3,904,146,274 kWh Zagreb Holding Group Sustainability Report for 2017 12 Chapter 5 Strategy and Objectives 13 2 / Letter by the President of the Management Board Zagreb Holding Group Sustainability Report for 2017 14 Chapter 2 Letter by the President of the Management Board 15 Business strategy of Zagreb Holding Group is based on the three following pillars: high-quality and reliable public services for citizens of Zagreb; growth and development, be it financial, non-financial, 2 / Dear readers, technological or investment-related, including strengthening of human potential; and corporate sustainability and management, which, besides the “health” of the organization’s balance sheet, also includes sound natural resource management and a positive impact on the community. We are a company that primarily provides services of public interest. Thus, we have a great Sustainability Report of Zagreb Holding Group represents responsibility towards the community, but to us, such responsibility is also of great importance. a comprehensive insight into our company, its influences Therefore, this Report comprises information about visible components of our operations, such as daily potable water supply and drainage, natural gas distribution and supply, organisation and practices, business challenges, objectives and results, of public transportation, waste collection and management, infrastructure maintenance and je usmjerenaas well as potential areas loremfor further advancements. This numerous other services important for the lives of our fellow citizens. However, this Report also Strategija is our second non-financial report and it includes a larger reflects the context in which we operate and areas of our operations that may invisible to our number of GRI Standard indicators, which we have chosen service users, but that are of equal importance for understanding our business processes and ipsum dolor sumum...based on a significantly improved process for identifying governance practices. material issues that was carried out prior to compiling this Our aim was to show that Zagreb Holding Group analyses value creation in each of the three Report. We have described it in detail so that readers could following dimensions: financial, environmental and social, which also includes risk identification. assess the extent to which this Report reflects key influences Some of the Group’s components have also identified climate change risks, which indicates their of our business on society and environment. increasing impact on business. Also, it is visible that management of the environmental impact of our activities significantly affects the sustainability of the City of Zagreb and Zagreb Holding Group. However, we do not see this only as a great challenge, but also as an opportunity to address several significant environmental protection issues in the City of Zagreb, such as waste management. Although many activities were carried out in 2017, especially in relation to the improvement of the quality of infrastructure for separate waste collection, we are aware of the major changes in work organization and technology ahead of us. These changes will allow us to successfully respond not only to new regulations, but also to the growing expectations of the citizens of Zagreb. We have been extremely dedicated in carrying out activities related to systematic energy and water management in all of the Group’s components. Results of these activities, among which is the introduction of the energy management system in accordance with the HR EN ISO 50001 standard, will be presented in more detail in the next report. Everything that we do revolves around people - our fellow citizens (service users) and our employees. This Report offers a wealth of information about all activities carried out by Zagreb Holding Group with the aim of improving the quality of communication with the citizens of Zagreb. For those purposes, we use all available communication channels, especially social media and digital applications which allow a prompt reaction in any situation that may arise. We have also described numerous projects and investments aimed at increasing the quality of public services, aware that the City is a complex mechanism, with high demands that may not all be fulfilled over the course of only one year. We would like to point out that this Report itself constitutes a governance tool, one that has raised many questions in relation to the quality of current processes and thus put an entirely different perspective on potential and continuous future improvements. To widen this new perspective even further, we invite you to read and comment on this Report. Sincerely, Ana Stojić Deban Zagreb Holding Group Sustainability Report for 2017 16 Chapter 5 Strategy and Objectives 17 3 / Zagreb Holding Profile Zagreb Holding Group Sustainability Report for 2017 18 Chapter 3 Zagreb Holding Profile 19 3 / Zagreb Holding Profile Zagreb Holding Group consists of the company Zagreb Holding Ltd., which performs its Zagreb Holding as we know it primary operations through 16 subsidiaries, 8 affiliates and 1 institution. The Group operates in the territory and on the market of the Republic of Croatia. Its head office is located in today was founded in 2006, after Zagreb. The history of Zagreb Holding dates back to 1862 and the foundation of the first municipal service company in Zagreb - Gasworks. At that point, Zagreb started the process of 21 companies owned by the City of modernising municipal services which has continued to the present day, albeit to a
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