Bharat Petroleum, BP, Caltex Australia, Calumet Specialty Products, Cepsa, Chevron, China National Petroleum, ConocoPhillips,2010 Sustainability Cosmo Reporting Oil, of the CPC, World's CVR Energy,Largest Eni, Petroleum Exxon Refining Mobil, Companies Formosa Petrochemical, Frontier Oil, Galp Energia, Pacific Sustainability Index Scores: A benchmarking tool for online sustainability reporting GS Holdings, Hess, Hindustan Petroleum, Holly, Idemitsu Kosan, Indian Oil, Israel C o r p . , L u k o i l , M a r a t h o n O i l , M o l Hungarian Oil and Gas, Murphy Oil, Neste Oil, Nippon Mining Holdings, Nippon Oil, OMV Group, PDVSA, Petrobras, Petronas, Petroplus Holdings, PKN Orlen Group, PTT, Reliance Industries, Repsol YPF, Rosneft Oil, Royal Dutch Shell, Showa Shell Sekiyu, Sinopec, SK Holdings, S-Oil, Statoil Hydro, Suncor Energy, Sunoco, Tesoro, TNK-BP Holding, Total,United Refining, J.E. Morhardt, Elgeritte Adidjaja, Gracie Beck, Shae Blood, Leah Bross, William Brown, Carolyn Campbell, Jaclyn T. D'Arcy, Whitney Ellen Dawson, V a l e r o E n e r g y , WKaren de e Wolski, s tKaren e Diaz, r Erin n Franks, R Karina e Gomez, fi nAustin i Prentice n g Hallett, Bukola Jimoh, Eric Robert King, Ryan Dean Chas Kristensen, Danielle L. Manning, Allison Scott, Ashley Scott, Aisha Shaikh, Michael Handler Shoemaker, Jennifer Katelyn Ward, and Kathleen West. Contents The Roberts Environmental Center has been the foremost Topics Page analyst of corporate sustainability reporting for over a Company Rankings 3 decade. We analyze corporate online disclosure using our Lead Analyst’s Commentary 4 Pacific Sustainability Index (PSI) and publish the results Carbon Capture and Storage Trends in the 5 online. Petroleum Industry Industrial Sector** 2 2 2 2 2 2 2 PSI Overview 7 0 0 0 0 0 0 0 PSI Scoring in a Nutshell 8 0 0 0 0 0 0 1 Environmental Intent Topics 9 4 5 6 7 8 9 0 Environmental Reporting Topics 10 Aerospace and defense X X Social Intent Topics 11 Airlines X X Banks, Insurance X Social Reporting Topics 12 Chemicals X X X Environmental Intent Element of the PSI 13 Largest Companies in China X Scores 1 Colleges/Universities X Environmental Reporting Element of the PSI 14 Computer, Office Equipment, X Scores and Services Consumer Food, Food X X Social Intent Element of the PSI Scores 15 Production, & Beverages Social Reporting Element of the PSI Scores 16 Electronics and X X X Environmental Intent Scores Ranking 17 Semiconductors * * Environmental Reporting Scores Ranking 18 Energy X X X Environmental Performance Scores Ranking 19 Entertainment X Food Services X Social Intent Scores Ranking 20 Forest and Paper Products X X X Social Reporting Scores Ranking 21 General Merchandiser X Social Performance Scores Ranking 22 Homebuilders X Human Rights Reporting Element 23 Industrial and Farm X X PSI Scores Average by Countries 24 Equipment Mail, Freight, & Shipping X Visual Cluster Analysis 25 Medical Products & X Relationship between PSI Scores and 27 Equipment Revenue and Profit * Metals X X X Company Rankings Based on the Number of 30 Mining, Crude Oil X* X X Goals Reported Motor Vehicle and Parts X X X Company Rankings Based on the Better 31 Oil and Gas Equipment X Performance Reported Petroleum and Refining X X X Companies Rankings Based on the Number of 33 Pharmaceuticals X X X X Scientific, Photo, & Control X Topics in which Performance is Better than Equipment Sector Average Telecommunications, X Analyst’s Comments, alphabetically listed by 34 Network, & Peripherals company name Utilities, Gas, and Electric X* X* X Appendix: PSI Questionnaire 88 * Multiple-sector category was separated in later years. **As of October 2010. Questions should be addressed to: 1 Top 50 Liberal Art Colleges. Dr. J. Emil Morhardt, Director ([email protected]) The goal of corporate report analysis conducted by the Roberts Roberts Environmental Center Environmental Center is to acquaint students with Claremont McKenna College environmental and social issues facing the world’s industries, 925 N. Mills Ave. Claremont, CA 91711-5916, USA and the ways in which industry approaches and resolves these Direct line: (909) 621-8190 issues. The data presented in this report were collected by student research assistants and a research fellow at the Elgeritte Adidjaja, Research Fellow: (909) 621-8698 Roberts Environmental Center. Copyright 2010 © by J. Emil ([email protected]) Morhardt. All rights reserved. Departmental secretaries: (909) 621-8298 www.roberts.cmc.edu 1 Petroleum Refining Sector Petroleum Refining Sector Corporate Environmental and Sustainability Reporting Company Rankings Overall Grade A+ MOL Group (Hungary) MOL Group 61.13 OMV Group 58.37 A OMV Group (Austria) S-Oil 53.35 A- S-Oil (South Korea) Marathon Oil 52.52 Eni 51.99 A- Marathon Oil (USA) Repsol YPF 50.56 A- Eni (Italy) Total 46.66 Exxon Mobil 45.92 A- Repsol YPF (Spain) Petrobras 44.29 B+ Total (France) CPC 43.84 Sunoco 42.52 B+ Exxon Mobil (USA) Suncor Energy 42.52 B+ Petrobras (Brazil) Idemitsu Kosan 41.81 B+ CPC (Taiwan) Bharat Petroleum 40.29 Reliance Industries 39.26 B Sunoco (USA) PKN Orlen Group 38.94 B Suncor Energy (USA) Chevron 38.55 BP 37.58 B Idemitsu Kosan (Japan) Tesoro 36.81 B Bharat Petroleum (India) Royal Dutch Shell 36.26 Cepsa 35.99 B Reliance Industries (India) Nippon Oil 34.90 B PKN Orlen Group (Poland) Cosmo Oil 34.45 Hess 34.13 B Chevron (USA) PTT 33.30 B- BP (U.K.) Rosneft Oil 32.81 Showa Shell Sekiyu 32.60 B- Tesoro (USA) ConocoPhillips 31.59 B- Royal Dutch Shell (Netherlands) Lukoil 30.41 Statoil Hydro 29.51 B- Cepsa (Spain) Neste Oil 29.44 B- Nippon Oil (Japan) Petronas 28.39 Indian Oil 28.11 B- Cosmo Oil (Japan) Nippon Mining Holdings 25.37 B- Hess (USA) Sinopec 24.77 Caltex Australia 21.06 B- PTT (Thailand) China National 19.10 C+ Rosneft Oil (Russia) Hindustan Petroleum 18.02 TNK-BP Holding 17.64 C+ Showa Shell Sekiyu (Japan) Valero Energy 17.36 C+ ConocoPhillips (USA) Murphy Oil 13.64 C+ Lukoil (Russia) PDVSA 9.67 Frontier Oil 9.08 C+ Statoil Hydro (Norway) SK Holdings 8.90 C+ Neste Oil (Finland) Formosa Petrochemical 8.14 Galp Energia 7.41 C+ Petronas (Malaysia) Petroplus Holdings 6.40 C+ Indian Oil (India) Holly 5.67 Western Refining 5.53 C Nippon Mining Holdings (Japan) Israel Corp. 4.42 C Sinopec (China) Calumet Specialty 3.97 United Refining 3.24 C- Caltex Australia (Australia) CVR Energy 3.03 C- China National Petroleum (China) GS Holdings 0.00 C- Hindustan Petroleum (India) 0 25 50 75 100 D+ TNK-BP Holding (Russia) D+ Valero Energy (USA) This report is an analysis of the voluntary environmental and social reporting D+ Murphy Oil (USA) of companies on the Petroleum and Refining Petroleum Refining sector lists. D PDVSA (Venezuela) D Frontier Oil (USA) Data were collected from corporate websites during the initial analysis D SK Holdings (South Korea) period (dates shown below). A draft sector report was then made available D Formosa Petrochemical (Taiwan) online and letters were sent to all companies inviting them to review the D- Galp Energia (Portugal) analysis, to identify anything missed by our analysts, and to post additional D- Petroplus Holdings (Switzerland) D- Holly (USA) material on their websites if they wished to improve their scores. D- Western Refining (USA) Analysis Period: 8/15/2009through 12/12/2009 D- Israel Corp. (Israel) Draft sector report available for review: 5/7/2010through 6/7/2010 D- Calumet Specialty Products (USA) D- United Refining (USA) D- CVR Energy (USA) F GS Holdings (North Korea) www.roberts.cmc.edu 2 Petroleum Refining Sector Lead Analyst’s Commentary to limit greenhouse gases, raised public ire and By Karen de Wolski, CMC ‘11 it the end, didn’t work. Why do oil companies think they have a right to increase pollution of In most sectors scored by the Roberts California air?, the public asked. Maybe this Environmental Center, there is a high correlation kind of public pressure will cause large refiners between revenue and overall score, which to divert the resources necessary to get back to makes sense considering that large companies the top of our list. have more capital available to spend on corporate sustainability reporting. Their reports The correlation between revenue and score therefore tend to be more thorough and in the petroleum refining sector is impressively professional due to the resources invested in low compared to most other sectors. For them. Because larger companies are also more example, revenue explained 59% of the likely to be under public and governmental differences in score in the paper products scrutiny than small ones, high revenue sector, 54% in the pharmaceutical sector, and corporations are often also more motivated to 45% in the chemicals sectors, but only 7% in the genuinely improve sustainability performance. petroleum refining sector. The top scoring Consequently, there is usually an authentic companies, Mol Hungarian, OMV, S-Oil, and relationship between reporting quality and Marathon, have relatively unsubstantial practice, and the added transparency reinforces revenues compared to their better-known constant performance improvement. The counterparts, yet have managed to obtain higher correlation between revenue and score is grades than the highest grossing corporations in highest in consumer-driven industries, such as the sector. How can a small Hungarian oil motor vehicles, and lowest in sectors that cater company produce better corporate sustainability to consumers with little choice of supplier, such reporting than BP or Exxon Mobil? as energy and utilities. The petroleum refining business falls somewhere in the middle. There are some key benchmarking points Consumers frequently select their petroleum that help to answer this question.