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Centrica Responsibility Report 2006

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Centrica Responsibility Report 2006 Centrica responsibilityCorporate responsibility report 2006 Contents 2 About this report 116 Environment 118 Climate change 4 CEO introduction 22 Renewable energy 25 Biodiversity 5 Our approach 26 Gas production and storage 27 Power generation 6 Key impact areas 40 Operational footprint 8 Climate change 4 Environmental management 9 Customer service system 0 Health, safety and security 42 Involving employees 11 Energy pricing 43 Performance 2 Energy security 46 Future commitments 4 Gas exploration in Nigeria 147 Communities 14 Performance indicators 49 Our impact 50 Offices and call centres 18 CR highlights 55 Engineering workforce 59 Power generation and gas 21 Business overview production 23 British Gas Residential 66 Supporting customers 23 British Gas Business 67 Involving employees 24 British Gas Services 69 Performance 24 Centrica Energy 74 Future commitments 25 Centrica Storage 25 Centrica North America 175 Investors 26 Europe 176 Suppliers 27 Business case for CR 78 Selection 79 Payment 28 Business principles 180 Governments 31 CR governance 33 CR Committee 185 Economic impacts 35 Risk management 87 Value added statement 36 ABI guidelines 38 Quality management 188 Performance summary 95 Global reporting initiative 39 Dialogue 205 United Nations Global Compact 4 Stakeholder map Communication on progress 50 Dialogue in 2006 5 Memberships 206 Commitments 208 Customers 53 Customers 20 Employees 55 Pricing 211 Environment 56 Customer experience 22 Community 60 Vulnerable customers 67 Energy efficiency 214 Case studies 72 Green electricity 25 Customers 75 Customer safety 225 Employees 77 Sales and marketing 235 Environment 79 Customer diversity 24 Community 8 Performance data 82 Future commitments 245 Assurance 84 Employees 86 Human capital management 88 Health, safety and security 9 Workplace diversity 98 Management development 05 Employee relations 112 Reward and remuneration 114 Future commitments Corporate responsibility report 2006 www.centrica.co.uk/cr06 About this report This report covers our corporate responsibility activity and performance from 1 January 2006 to 31 December 2006. It updates our last corporate responsibility report, which was published in May 2005. For the fourth consecutive year, our report is externally assured by The Corporate Citizenship Company. 2 Corporate responsibility report 2006 www.centrica.co.uk/cr06 About this report This report covers our corporate responsibility activity and performance from January 2006 to 3 December 2006. It updates our last corporate responsibility report, which was published in May 2005. For the fourth consecutive year, our report is externally assured by The Corporate Citizenship Company. Read our assurance statement. The scope of the report covers our global operations. Our main operations are in the UK and North America and as a result, the content of this report focuses on these activities. In future reports, as our international businesses continue to evolve and grow, we will report our activity and performance accordingly. We use external guidelines and frameworks to inform our reporting where relevant. Although we do not explicitly base our report on the Global Reporting Initiative (GRI) guidelines, we have included a GRI index to show which elements of the guidelines we cover and to enable comparison with other companies’ reports. We have also indexed the report against our Group business principles and the principles of the United Nations Global Compact, to which we are a signatory. In response to stakeholder feedback received during 2006 we have introduced a number of changes to our approach this year. We have: • Broadened our focus on our most significant areas of impact to include customer service, energy pricing and energy security • Increased coverage on the CR activities and approach of Direct Energy, our North American subsidiary • Tried to be clearer about how our activities go beyond regulatory compliance to address key areas of social and environmental impact • Included more detailed information on our government affairs and lobbying activity including our responses to consultations We believe we have made good progress in 2006 but recognise the need for continual improvement. Feedback from our stakeholders will help us to do this. We encourage you to contact us with your views. We will publish our next corporate responsibility report in May 2008. 3 Corporate responsibility report 2006 www.centrica.co.uk/cr06 Introduction from Sam Laidlaw Welcome to Centrica’s Corporate Responsibility Report for 2006. It describes our approach to managing the social, ethical and environmental impact of our business activities, highlights our performance this year and outlines our future plans. The impact of our operations is wide ranging and our engagement with stakeholders continues to be fundamentally important to our success. Since I joined the company in July 2006, I have been impressed by the level of commitment and creativity we apply to both the challenges and the opportunities created by corporate responsibility (CR). Sam Laidlaw Chief Executive I am encouraged by the progress we made in 2006 under the direction of Mary Francis CBE, chair of our Corporate Responsibility Committee. But I believe there is more we can do. Rather than outline my detailed thoughts in this statement I have given an interview, in which I describe why I believe CR is critical to Centrica, comment on our performance last year and outline what we need to do in the future. I would encourage you to access the video, read our report and provide feedback on how you think we’re doing. Your comments – positive and negative – are valuable to us and will help us to develop and shape our future approach. 4 Corporate responsibility report 2006 www.centrica.co.uk/cr06 Our approach Corporate responsibility is integral to a business that is managed in the long-term interests of its shareholders Understanding the impact of our business activities on society as a whole, and responding accordingly, is fundamental to Centrica’s strategy. We must be attuned and responsive to the needs and opinions of our customers, employees, suppliers and wider stakeholder groups, and to emerging changes in society and government. Our ability to maintain continuous and dynamic engagement with our stakeholders around the world will help us to effectively manage the social, ethical and environmental impact of our operations, and protect and enhance our reputation. Through this process we seek to minimise risks and identify opportunities, so that we can create sustainable value for our shareholders and contribute positively to wider economic development in the regions in which we operate. 5 Corporate responsibility report 2006 www.centrica.co.uk/cr06 Key impact areas Climate change Customer service Health, safety and security Energy pricing Energy security Gas exploration 6 Corporate responsibility report 2006 www.centrica.co.uk/cr06 Key impact areas Responsible business. Centrica’s vision is to be a leading supplier of energy and related services in our chosen markets, in order to maximise value to shareholders. Understanding the impact of our business activities on society as a whole, and responding accordingly is fundamental to our strategy. Climate change Customer service Health, safety and security By managing our environmental Our aim is to earn the trust and respect The health, safety and welfare of our impact we seek to contribute to the of our customers by understanding employees in the workplace, and creation of a sustainable low carbon their evolving needs and consistently others who may be affected by our economy whilst ensuring security delivering high standards of service. activities, are top priorities for Centrica. of energy supply. Energy pricing Energy security Gas exploration Following a period of volatility in We are ensuring security of energy To ensure diversity of supply Centrica wholesale energy markets we are supplies for our customers by investing is exploring for new sources of gas working hard to ensure that our in long-term contracts, constructing in Norway, Egypt, Trinidad and Nigeria. customers receive affordable assets and exploring for gas. and reliable energy supplies. 7 Corporate responsibility report 2006 www.centrica.co.uk/cr06 Key impact areas Climate change Climate change is the greatest What we are doing environmental challenge facing society • We have launched a new business, today. The world is warming up, largely called British Gas New Energy, because of emissions of greenhouse to lead our drive to offer a range gases, particularly carbon dioxide of low carbon products and services (CO2). About 6.5 billion tonnes of CO2 to UK customers is emitted globally each year, mostly through burning coal, oil and gas • The electricity British Gas provides for energy. to its customers has the lowest carbon intensity of any of the major The earth’s surface temperature UK suppliers Climate change has risen over the past 40 years, By managing our environmental with the largest increases occurring • We are committed to investing impact we seek to contribute in the second half of the last century. £750 million in renewable generation to the creation of a sustainable low Globally, the 9 hottest years on and now have three operational wind carbon economy whilst ensuring record have all been since 980, farms. We are also building the UK’s security of energy supply. with 11 of those occurring in the largest offshore wind farm at our last 2 years. Lynn and Inner Dowsing sites in the Greater
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