Post on 30-Sep-2020
2010Reporting
Oil and gas industryguidance on voluntarysustainability reporting
Endorsed by:
Legal note
This voluntary guidance document is designed to serve as a resource for interested companies; the indicatorsand information referenced in this work do not establish an industry standard as to the nature of a company’spublic reporting practice. The recommendations in this Guidance on how to report on a particular issue areaddressed to those companies who choose to include that issue in their voluntary sustainability reporting, andterms such as ’the reporting company should …’ are to be understood in this sense.
The terms and definitions used in this document are not necessarily the same as terms and definitions used invarious statutes, rules, codes or other authoritative legal documents. Users and readers of this documentshould refer to relevant legal sources or consult their own legal counsel for explanations as to how the termsand definitions used in this document may differ from the legal terms and definitions (e.g. spills and hazardouswastes) used in their particular areas of operation. Anything in this document regarding voluntary reportingof indicators is not intended to imply that any of the indicators are required to be reported under any national,local or other law. Furthermore, it is not intended to serve as a substitute for existing public reportingrequirements and regulations. Any company reporter that has a question as to whether or not reports thatfollow the information contained herein will meet any specific reporting requirements applicable to theirparticular operations should consult with the reporter’s own legal counsel.
A cautionary note regarding performance indicators
Aggregated, company-level, non-financial performance data, developed using the indicators in thisGuidance, can be informative for comparing relative performance among different companies, such asbenchmarking safety incident statistics across the oil and gas industry. A company can use such comparisonsto evaluate its own performance relative to peers, and identify areas for potential improvement. However,limitations to comparability exist due to various factors including the different methods companies may use tomeasure, normalize and report specific indicators. Although efforts have been made throughout the Guidanceto improve comparability, report users are advised to exercise caution when using data from sustainabilityreports to compare performance. For example, comparing two companies that report greenhouse gasemissions on a different basis (e.g. equity share vs. operated, as described in Appendix A) could bemisleading regarding actual performance. Specific indicators from similar operations can sometimes beusefully compared to help performance management. However, the company-level, aggregate data typicallyreported in sustainability reports may not provide adequate comparability for some metrics. Where thisGuidance mentions comparability, it is not intended to imply that data in sustainability reports, and thereforecompanies’ performance, are always directly comparable.
Separate from company sustainability reporting, industry associations and others may choose to implementspecific performance benchmarking studies, which may build upon the indicators in this Guidance.
It is also recognized that some of the indicators and/or reporting elements are new, and it may take a numberof years for companies to begin to report them. This is particularly important for many of the social andeconomic indicators that are still evolving within company sustainability reports.
OGP Report Number 437
© IPIECA/API/OGP 2010 All rights reserved.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means,electronic, mechanical, photocopying, recording or otherwise, without the prior consent of IPIECA, API and OGP.
This publication is printed on paper manufactured from fibre obtained from sustainably grown softwood forests andbleached without any damage to the environment.
Oil and gas industryguidance on voluntarysustainability reporting
5th Floor, 209–215 Blackfriars Road, London SE1 8NL, United KingdomTelephone: +44 (0)20 7633 0272 Facsimile: +44 (0)20 7633 2350E-mail: reception@ogp.org.uk Internet: www.ogp.org.uk
International Association of Oil & Gas Producers
5th Floor, 209–215 Blackfriars Road, London SE1 8NL, United KingdomTelephone: +44 (0)20 7633 2388 Facsimile: +44 (0)20 7633 2389E-mail: info@ipieca.org Internet: www.ipieca.org
The global oil and gas industry association for environmental and social issues
The American Petroleum Institute
1220 L Street NW, Washington DC, 20005-4070, USATelephone: +1 202 682 8000Internet: www.api.org
2nd Edition, 2010
We are pleased to introduce the second edition ofthe Oil and Gas Industry Guidance on VoluntarySustainability Reporting (hereinafter the‘Guidance’). It is the outcome of three years ofsharing, assessing, debating and consensusbuilding for our three associations—IPIECA, theglobal oil and gas industry association forenvironmental and social issues; the AmericanPetroleum Institute (API); and the InternationalAssociation of Oil & Gas Producers (OGP). Ourmembership includes companies that are leadersin sustainability reporting, and this revision bringstogether their wealth of technical expertise. Theindustry’s commitment to this project is evidencedthrough the tremendous participation in itsReporting Task Force, as noted in theAcknowledgements on page 4.
Encouraging improvement
The oil and gas sector continues to provideessential energy for society’s development. Ourmember companies also recognize that managingsustainability impacts associated with producingfuels and other energy products is an importantresponsibility. This includes addressing thechallenges associated with climate change risks,and operating in remote and sensitive areas of the
world. IPIECA, API and OGP support the industryin addressing these and other sustainabilitychallenges. Collectively, we also promote continuousperformance improvement on environmental, healthand safety, and socio-economic topics bydeveloping and sharing good industry practices.An important practice is sustainability reporting.Clear and consistent reporting helps companiescreate a solid platform for productive engagementand performance improvement.
Increasing engagement
The second edition reflects feedback andimprovements in reporting practices from manysources within and outside the industry. A keyadditional step has been to engage a five-member Stakeholder Panel of leading experts toadvise us on both the process and the content ofthe Guidance. The Panel prompted a survey ofmember and non-member companies within andbeyond our associations for this revision. Thesurvey confirmed that sustainability reporting isa well-established practice for our multinationalmembers, and that more national oil companiesand smaller international companies are startingto report sustainability information to their keystakeholders. Across the companies surveyed,
IPIECA • API • OGP
ii
Improving our transparencyA foreword from the oil and gas industry associations
Richard Sykes, IPIECAExecutive Secretary
Jack N. Gerard,API President and CEO
Michael Engell-Jensen,OGP Executive Director
… managingsustainability impacts
associated withproducing fuels and
other energy productsis an importantresponsibility.
we noted the increasing awareness andapplication of our Guidance, and also the cross-industry guidelines from the Global ReportingInitiative (GRI).
This revision
Our revised Guidance recognizes that certainsustainability issues will be more important tosome companies than to others. The industryincludes differing types of multinational andnational companies which face specific social andenvironmental challenges in different locationsacross the globe. Therefore, we have placed moreemphasis in this revision on reporting as anengagement process and we encouragecompanies to determine which issues are mostimportant for reporting to their own stakeholders.Reflecting industry consensus, the Guidancecovers a range of issues and allows companies toselect from related indicators that offer a choiceon the depth and detail to be communicated. Byproviding flexibility and consistency, the Guidanceaims to serve both new and experienced reporterswhile avoiding the pitfalls of formulaic reporting.To support companies in communicating the issuesof most interest to their stakeholders, we haveintroduced the following three tools to help bothnew and experienced reporters: ● A six-step Reporting Process, including a
‘materiality’ step to determine the mostimportant issues for reporting.
● A set of Issues and Indicators likely to berelevant for reporting by oil and gas companies.
● Three levels of Reporting Elements within eachindicator to provide options that enableconsistent reporting across the industry:Common Reporting Elements that are well-established; Supplemental Reporting Elementsthat enable greater depth of reporting; andOther Reporting Elements that are less-established but emerging.
The Guidance is voluntary and, as such, does notset minimum requirements or predeterminestakeholder needs. Instead we encourage aconsistent ‘how-to’ approach, with companiesdetermining what to report based on a materialityprocess and stakeholder expectations.
Our hope
Over the next decade and beyond, our industrywill continue to address multiple sustainabilitychallenges as it seeks to provide the energyessential for societal development. Throughout thisjourney, communication and engagement with itsstakeholders will be essential. So it is our hopethat the Guidance will support the momentum wesee within our industry to publish sustainabilityreports. Our aim is that the Guidance will helpreporting companies across the global oil andgas industry to improve the quality andconsistency of their reports. We also hope theGuidance will provide interested stakeholders witha useful overview of reporting as an industrygood practice.
Looking ahead
IPIECA, API and OGP will continue to encourageour members and others in the industry to reporton their performance in addressing sustainabilityissues. Our associations plan to continuesupporting our member companies throughsharing good practices, and further develop ourguidance on sustainability reporting. Pleasecheck the IPIECA website for details of our plansas they evolve.
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OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
IPIECA, API and OGPwill continue toencourage our
members and othersin the industry toreport on theirperformance in
addressingsustainability issues.
OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Section 4: Environmental indicators 33
Environmental indicators: an overview 34
● Climate change and energy 35
E1: Greenhouse gas (GHG) emissions 36
E2: Energy use 40
E3: Alternative energy sources 43
E4: Flared gas 45
● Ecosystem services 47
E5: Biodiversity and ecosystem services 48
E6: Fresh water 51
● Local environmental impact 54
E7: Other air emissions 55
E8: Spills to the environment 57
E9: Discharges to water 60
E10: Waste 62
Section 5: Health and safety indicators 65
Health and safety indicators: an overview 66
● Workforce protection 67
HS1: Workforce participation 68
HS2: Workforce health 70
HS3: Occupational injury and illness incidents 72
● Product health, safety and environmental risks 75
HS4: Product stewardship 76
● Process safety and asset integrity 78
HS5: Process safety 79
Legal and cautionary notes Inside front cover
Improving our transparency: a forewordfrom the oil and gas industry associations ii
Joint Statement of the independentStakeholder Panel 2
Acknowledgements 4
Section 1: Setting the context—Why report? 5
Benefits of reporting 6
About the Guidance 7
Using the Guidance 7
Section 2: The reporting process—How to report 9
General reporting principles 10
Process overview 10
Engaging stakeholders 11
Step 1 Articulate vision and strategy 13
Step 2 Describe governance and management systems 14
Step 3 Determine material issues for reporting 16
Step 4 Select indicators and collect data 18
Step 5 Analyse data and incorporate into narrative 20
Step 6 Provide assurance 24
Section 3: Issues and indicators—What to report 25
Overview of issues and indicators 26
Reporting elements 27
Quantitative and qualitative reporting 27
Data management 29
Data normalization 30
Standard indicator format 32
Contents
iv
IPIECA • API • OGP
Section 6: Social and economic indicators 83
Social and economic indicators: an overview 84
● Community and society 85
SE1: Local community impacts and engagement 86
SE2: Indigenous peoples 88
SE3: Involuntary resettlement 90
SE4: Social investment 92
● Local content 94
SE5: Local content practices 95
SE6: Local hiring practices 97
SE7: Local procurement and supplier development 98
● Human rights 100
SE8: Human rights due diligence 101
SE9: Human rights and suppliers 103
SE10: Security and human rights 104
● Business ethics and transparency 105
SE11: Preventing corruption 106
SE12: Preventing corruption involvingbusiness partners 107
SE13: Transparency of payments to host governments 108
SE14: Public advocacy and lobbying 109
● Labour practices 110
SE15: Workforce diversity and inclusion 111
SE16: Workforce engagement 112
SE17: Workforce training and development 113
SE18: Non-retaliation and grievance system 114
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OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Appendix A: Detailed guidance ondeveloping a reporting boundary 115
Appendix B: Glossary 123
Appendix C: Summary of key changes since 2005 and relationship to GRIG3 Guidelines 131
Appendix D: Measurement units andconversion factors 137
Appendix E: General references and source materials 141
Joint Statement of the Independent Stakeholder Panel
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IPIECA • API • OGP
We appreciated and enjoyed the opportunityto engage with IPIECA, API and OGP in
updating and strengthening their 2005sustainability reporting guidance. Our goal was tohelp the Reporting Task Force drive greatertransparency and accountability within the oil andgas sector and encourage progress towardssustainable business practices.
By opening up their process and providing us withan unedited voice in this statement, IPIECA, API andOGP have taken an important and courageous stepforward. Mindful of our own limitations in terms ofthe diversity of perspectives we brought to theprocess, we commend the emphasis in the newGuidance on engaging stakeholders in thereporting process. Furthermore, we welcome thedecision made by the Task Force to undertake
further stakeholder consultation on the materialissues and indicators for sustainability reportingthrough active use of the IPIECA website. Laying outa clear cycle of continuous updates to the Guidanceprovides the much-needed opportunities forongoing dialogue with stakeholders and ultimatelyprovides greater value to member companies.
We found the engagement process for the Panel tobe highly effective, involving high-qualityparticipation by IPIECA, API and OGP membercompanies, and ample opportunity for frank andhonest exchange. The Task Force was responsive toour views, and provided clear explanations whenour suggestions were not adopted. We believe theresulting Guidance represents a majorimprovement over the 2005 edition. We especiallywant to highlight the following enhancements:
To improve external engagement as part of the Guidance revision process, the IPIECA Reporting Task Force convened
a Panel made up of independent stakeholders with expertise in sustainability reporting practices relating to the oil and
gas industry. As knowledgeable members of the reporting community, the Panel represented views of typical report
reader groups: business and industry; environmental and community-oriented NGOs; investors; and multilateral
institutions. At two face-to-face meetings—one early in the process and one towards the end—the Panel provided
candid, significant and challenging input to the Task Force for the revision. At the onset of this engagement, the Panel
was asked to assess the quality, credibility and effectiveness of the revision process and to provide ideas for
improvement. The following is the joint statement from this Independent Stakeholder Panel.
* Motoko Aizawa was the designated IFC representative for the panel but was replaced by Louise Gardiner at both panel sessionsdue to scheduling conflicts.
** Elizabeth McGeveran was the designated F&C Asset Management representative for the first panel session. Karina Litvack replacedMs. McGeveran for the second session due to availability.
Motoko Aizawa,International FinanceCorporation*
Tom Delfgaauw,Independent
Louise Gardiner,International FinanceCorporation*
Roger Hammond, Living Earth
Karina Litvack, F&C AssetManagement**
Elizabeth McGeveran,F&C AssetManagement**
Janet Ranganathan,World ResourcesInstitute
linking reporting and performance. Notwithstandingtheir limitations, targets are an effective mechanismfor driving progress, enabling benchmarkingagainst peers, and if developed with keystakeholders, ultimately building trust. This isespecially important for an industry facing levels ofpublic scrutiny and criticism unlikely to dissipateany time soon, as concerns grow about climatechange, contractor standards, and the environmentaland social impacts of spills from deepwater drilling.
Fourthly, we believe that the role and performanceof contractors deserve more attention by routinelyincluding them in the Scope of the indicators,where possible and relevant.
Finally, we would like to note that the broaderlandscape of sustainability reporting is rapidlyevolving with moves towards greaterstandardization, driven largely by the GlobalReporting Initiative and growing interest insustainability reporting by the financial community.Sustainability issues are also beginning their steadymarch into financial reports, thanks in part to theInternational Integrated Reporting Initiative. Weurge IPIECA, API and OGP to engage in theseefforts and share their considerable experience andtechnical expertise, thereby also strengtheningfuture iterations of the Guidance.
In conclusion, we are grateful to IPIECA, API andOGP for the opportunity to help strengthen theGuidance. We hope the hard work of theReporting Task Force will be put to good use bymembers and the oil and gas industry morebroadly, particularly non-reporting companies. Tothis end, we encourage IPIECA, API and OGP to seta joint target to support all member companies inpublishing sustainability reports routinely within thenext five years, using the new sustainabilityguidance. If the old adage that what gets measuredgets managed is true—and we believe it is—thiswill signal genuine progress.
● A new front section that sets the strategic contextfor reporting, including vision, strategy andprocess steps in preparing an effective report,and an expanded section on materiality andstakeholder engagement.
● Much-strengthened health and safety, socio-economic and environmental sections, includingnew indicators on ecosystem services, processintegrity and local content.
● Useful background information that linksindicators to key sustainability issues facing theindustry.
● An expanded section on climate change.
While we acknowledge the many improvements inthe Guidance, there are a few shortcomings. Inparticular, we regret that it does not provide moreemphasis on the need for the industry to report onactions taken to reconcile the twin challenges ofenergy security and climate change. One notableexample is greenhouse gas emissions related to theuse of petroleum products. Given the significance andscale of the transition that the oil and gas industrymust undergo over the next few decades, we believethat product-related emissions and strategies toreduce them should be a common reporting element.
Another key aspect where the Panel and the TaskForce regrettably had to ‘agree to disagree’ wasthe absence of any minimum reporting standards.We appreciate IPIECA’s desire to avoid setting abar so high that it discourages new reporters, butwould have preferred them to use the revisionprocess to define what constitutes minimum, goodand best reporting practice. First-time reporterscould then be accommodated by providingguidance on how to move from minimum to bestpractice within a specified timeframe.
Thirdly, we would like to have seen more on theimportance of targets. In the Panel’s view, setting,meeting and reporting on targets represents thecornerstone of corporate sustainability efforts, by
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OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
IPIECA • API • OGP
4
Acknowledgements
The information contained in this document was developed jointly under the auspices of IPIECA, APIand OGP. It represents the consensus of a Reporting Task Force (RTF), composed of more than 65representatives from 20 companies and 6 trade associations.
The document benefited significantly from the input and review of a Stakeholder Panel, which mettwice formally with the RTF and also contributed throughout the process.
The process of revising the Guidance benefited from an open dialogue with the Global ReportingInitiative (GRI) including the involvement of several RTF members working on this document andGRI’s oil and gas sector supplement.
The following companies and associations participated in the Reporting Task Force:
The IPIECA Secretariat project manager was Hannah Buckley, with support from Ruth Romer and EstellaNucci. Consultant support was provided by Judy Kuszewski and Yasmin Crowther (Stakeholder Panelfacilitators), Bill Boyle (technical editing), Lloyd Slater (style writing) and Nigel Jones (design).
Marathon (RTF and Steering Committee Chair)
API (Steering Committee Member)
ARPEL
BG Group
BP (Steering Committee Member)
Chevron (Steering Committee Member)
CNOOC
ConocoPhillips (Steering Committee Member)
Eni
EUROPIA
ExxonMobil (Steering Committee Member)
Hess
Hunt Oil
IPIECA
Nexen
OGP
Petrobras
Petronas
Repsol
Shell
Schlumberger
SNH
Statoil (Steering Committee Member)
Talisman Energy
Total (Steering Committee Member)
WPC
Photographs reproduced courtesy of the following: pages 5, 9, 25, 33, 48 (top), 54, 55 (bottom), 59, 65, 78, 83, 88, 90, 92 (top):Shutterstock.com; pages 11, 14, 16, 18, 20, 24, 37, 43, 47, 48 (bottom), 53, 55 (top), 61, 67, 71, 72, 75, 77, 91, 101, 105, 110,111: iStockphoto.com; page 13: Photos.com; pages 22, 73, 85, 86, 92 (bottom), 95 (top), 100: ExxonMobil Corporation; page 28:©Larry Lee Photography/Corbis; pages 30, 31, 35, 68, 98: Marathon Oil; page 94: BP; page 95 (bottom): Chevron.
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OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Section 1: Setting the context
Why report?
IPIECA • API • OGP
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Sect
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: Se
ttin
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he
conte
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The oil and gas sector is a fundamental part oftoday’s world, providing essential energy and rawmaterials for global development. A dynamic andinnovative business, the industry constantly seeksto adapt to new situations and challenges. Itinvests not only in the search for new oil and gas,but also in facilities infrastructure, technology,local communities, health and safety, and theenvironment. The sector continually examinesopportunities to meet growing energy demandaround the world, while seeking to mitigateadverse impacts and address the potential risks ofclimate change.
Not surprisingly, many people and organizationsworldwide want to understand the oil and gassector’s business and participate in dialogue withthe sector’s companies on the effects of theiractivities—the impacts, benefits, risks and trade-offs. In addition to annual reports on financialperformance and other communication initiatives,sustainability reporting—also known as corporatecitizenship or environmental, social andgovernance (ESG) reporting—is an importantway for individual companies in the sector toengage with stakeholders and help fosterinformed dialogue and understanding.
Oil and gas companies have been among thepioneers of sustainability reporting and haveprovided leading examples of good reportingpractices. This Guidance has been developed toshare good practice across the industry and toencourage companies, both current and newreporters, to keep their stakeholders informedabout their performance. The Guidancerepresents industry consensus on the mostprevalent sustainability issues and indicators, andaims to support continuous improvement ofsustainability reporting and performance acrossthe sector.
Benefits of reporting
Reporting can bring companies recognizablebusiness benefits. Through communication on itsmost important sustainability issues, a company’sreport becomes a reliable source of informationfor its stakeholders. By transparently describing itsbiggest challenges, reporting underpinsstakeholder engagement and represents thecompany’s values in action.
For oil and gas companies, reporting provides arobust platform for describing how strategicissues—such as climate change and energy—arebeing addressed through long-term plans andcurrent initiatives. For example, the report canexplain how the company is managing thesocio-economic impacts or environmental, healthand safety risks of operating in differentlocations. Once published, this informationenables further communication and engagementwith stakeholders. In the longer term, the benefitscan provide:● enhanced business value as investor
confidence grows in response to evidence thatthe company is managing important risks andpositioning itself to take advantage ofemerging opportunities;
● improved operations as employees develop adeeper understanding of a company’ssustainability values, and performanceindicators provide insight to supportcontinuous improvement;
● strengthened relationships as local communityleaders, civil society representatives,government officials and regulators, and otherkey stakeholders learn how the companyresponsibly manages sustainability issues; and
● enhanced trust and credibility as customers,suppliers and the wider society understand thecompany’s brand, operations and products.
… a company’sreport becomes areliable source ofinformation for its
stakeholders.
Why report?
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OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Section 1
: Setting th
e contex
t
This second edition of the Guidance replaces thefirst edition published in April 2005. This revisionis based on industry experience and feedback onthe original 2005 document, and benefited fromsignificant insights and suggestions from anindependent panel of stakeholders with expertisein the sector and in sustainability reporting (seepages 2–3).
The Guidance aims to assist oil and gascompanies in developing and enhancing thequality and consistency of their sustainabilityreports. It is designed for use by any oil and gascompany, whether it operates nationally,regionally or internationally. The Guidance isintended to cover the entire spectrum of oil andgas operations—from upstream exploration andproduction, through downstream refining,transportation and marketing, and alsopetrochemicals. The Guidance deliberatelyprovides choices, not only for the experiencedbut to enable new reporters or smallercompanies to focus on their most importantissues at a level appropriate to their businessand stakeholders. It recognizes that while somereporters are multinational public corporations,others may be state- or privately-ownedcompanies, where local reporting tailored toindividual stakeholders may be more importantthan aggregated reporting at the global level.
The Guidance is intended to help readers ofcompany reports understand the basis forreporting in the oil and gas sector.
About the Guidance
The Guidance is a reference tool aimed at helpingcompany sustainability managers, communicationsprofessionals and environmental, health andsafety or socio-economic specialists to developcorporate-level reports for internal and externalstakeholder audiences. It can be used to reportperformance to different audiences in differentways—for activities in a single country, for large
projects or for a single operation. The Guidanceis designed to offer flexibility in support of newreporters, who may initially focus on a limitednumber of key sustainability issues,geographical locations or specific audiences,and then, over time, gradually increasecoverage of their reporting.
Using the Guidance
IPIECA • API • OGP
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Sect
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: Se
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conte
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The Guidance is voluntary. It does not setminimum requirements or predeterminestakeholder needs. Instead, it encouragescompanies to make informed choices on what isimportant for their own reporting by engagingwith their stakeholders and understanding theirneeds. Then, with these choices made, reporterscan include relevant data and information thatbenefit from the consistency of industry consensuson the issues, indicators and reporting elementsdetailed in the Guidance. With effort focusedprimarily on those issues of significance to theindividual company and its stakeholders,reporting time and cost can be better managed.
The Guidance provides two types of assistance byhelping companies decide:● ‘how’ to report, by describing a process for
reporting; and ● ‘what’ to report, by providing options for
developing the content of the report.
Process
In Section 2, companies are encouraged toemploy a stepwise process for reporting by:● setting the context for the report by outlining
the company’s high-level vision and strategy,together with governance and managementsystems;
● determining the issues to include in the report,using the concept of materiality whichidentifies the complete set of issues ofrelevance to both the company and itsstakeholders; and
● selecting indicator data to be collected withinthe company’s reporting boundary andincorporated into the narrative.
The objective of each step is to build atransparent and concise report as part ofstakeholder engagement. The process helps thecompany to verify which issues and indicators arenot material and thus avoid unnecessary andtime-consuming reporting which can obscure therelevant issues.
Content
Sections 3 to 6 provide direction on the content ofa typical oil and gas industry report. TheGuidance provides a set of performanceindicators appropriate to sustainability issues inthe industry. Each indicator provides a choice ofreporting elements depending on the depth oraccuracy required (i.e. depending on themateriality of the issue for the company). Thereporting elements include measures that are‘common’, being the most established andconsistent across the industry today. Section 3provides guidance (including reportingboundaries and data normalization) on theapplication of the performance indicatorsprovided in Sections 4, 5 and 6, covering(respectively) environmental, health and safety,and social and economic issues.
Referencing the Guidance
Companies who use the process and/or thecontent sections are encouraged to reference theGuidance, acknowledging IPIECA, API and OGP,since doing so demonstrates a company’s effortsto report consistently by applying oil and gasindustry good practice. Within their reports,companies may wish to include an index of theGuidance indicators used, which would signalthat their reporting meets the intent of theindicator description and follows at least onereporting element.
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OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Section 2: The reporting process
How to report
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How to report
Sect
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: Th
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This section provides the foundation for goodpractice through sound principles and a six-stepreporting process.
General reporting principles
Five general reporting principles1, which wereincluded in the original 2005 document, areconstructive concepts for consideration ascompanies develop content for a sustainabilityreport:● Relevance: The reported information should
appropriately reflect the sustainability issues ofthe company and meet the needs ofstakeholders—both internal and external tothe company.
● Transparency: Information should be reportedin a clear, understandable, factual andcoherent manner, and should facilitateindependent review. Transparency includesdisclosure of the processes, procedures,assumptions and limitations affecting reportpreparation.
● Consistency: For reports to be credible,information-gathering processes and definitionsmust be systematically applied. Consistency inwhat is reported and how it is reported enablesmeaningful review of a company’s performanceover time, and facilitates comparison internallyand with peer companies.
● Completeness: Information should be includedin a manner that is consistent with the statedpurpose, scope and boundaries of the report.
● Accuracy: Information should be sufficientlyprecise to enable intended users to understandthe relevance of information with a suitablelevel of confidence.
Process overview
The publication of a sustainability report isgenerally the result of internal corporate processescombined with external dialogue. Although eachcompany will have its own approach, Figure 1illustrates the typical steps involved. These arediscussed in detail in the rest of this section.
1 These five principles were drawn from the reporting principles stated within The Greenhouse Gas Protocol (WRI/WBCSD, 2004) andhave evolved here to provide wider applicability for this Guidance. These principles have also been adapted for specific applicationin other IPIECA/API/OGP documents, including the Petroleum Industry Guidelines for Reporting Greenhouse Gas Emissions.
12
34
5
6Articulate vision
and strategy
Describe governanceand management
systems
Determinematerial issuesfor reporting
Select indicators andcollect data
Analyse data andincorporate into
narrative
Provide assurance
Stakeholder engagementthroughout process to assess
interests, needs and communicationpreferences, and reviewreporting effectiveness
Figure 1 The sustainability reporting process
Engaging stakeholders
Stakeholder engagement has an important rolethroughout the reporting process. Stakeholderviewpoints and dialogue can help to ensure thatthe report is relevant, accessible and credible toexternal audiences. Feedback on the completedreport can provide valuable insight to improvefuture reports and to initiate dialogue on issues.Thus, as an integral part of the reporting process,companies could consider proactively solicitingstakeholder views at different stages:● Starting out: Stakeholder opinion on the
company’s vision and strategy, governance,relevant issues and performance can begathered directly through dialogue orindirectly through media articles, publicreports and surveys.
● During production: Stakeholders can beinvited to comment on reporting expectationsor to review drafts, which may also contributeto some types of assurance.
● Post-publication: Stakeholders can be givenopportunities to review the completed report,indicating how they might make use of it, andwhat they would like to see in the future.
Many channels exist to further engagestakeholders on the report, including focusgroups, surveys, panels, web forums and socialnetworking. It is important to take care to ensureconsistency with the primary messages containedin the report.
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OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Section 2
: The rep
ortin
g p
rocess
Stakeholderviewpoints and
dialogue can help toensure that the
report is relevant,accessible and
credible to externalaudiences.
The process of reporting and related engagementis typically annual, providing a periodicopportunity for stakeholders to assess progressover time. Reported information may be providedin different formats, from stand-alone printedreports to internet-accessible formats that canallow a greater level of detail, timely updates andonline feedback.
Identifying the priority stakeholders forengagement on reporting can be a challenge forcompanies, and different approaches can beused. Figure 2 describes a simple analysistechnique known as ’stakeholder mapping‘.
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Sect
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: Th
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ss
Positive
Relationshipwith
company
Keep thesestakeholders
informed and givethem the
opportunityto input
Actively maintainand build directrelationships andunderstand how
these stakeholderscan help outreach
to others
Understandissues and
explore ways toengage
(including viathird parties)
Actively developinsight into these
stakeholders’ viewsand explore waysto engage directly(or via third parties)
Willingnessto engage
Negative
Relationshipwith
company
HighLow Willingnessto engage
Companies often find it useful to prioritize the diverse range of stakeholders, who may be interested intheir sustainability report or particular aspects of it, to ensure they have considered all importantaudiences and perspectives.
Stakeholders may be categorized into broad groups (e.g. institutional investors, campaigners,academics, businesses, politicians, thought-leaders, local communities, customers, regulators,employees) and then ‘mapped’ to guide further engagement. The mapping may consider the expressedopinions of the stakeholders, the nature of their relationship with the company and the nature ofcurrent or previous engagement activities.
Figure 2 Stakeholder mapping
1A sustainability report should set out how acompany’s sustainability priorities are integratedinto its overall vision and business strategy. Thesepriorities should cover both operational issues,such as health and safety, environmentalcompliance and labour practices, and longer-termconsiderations such as climate change risks oraccess to new energy resources.
Define sustainability
Reports generally describe a company’sunderstanding of what ‘sustainability’, ‘socialresponsibility’ or ‘corporate citizenship’ means tothe company, and indicate the main implicationsand opportunities for its core oil and gasbusinesses. For example, a company may wishto discuss how its long-term success depends onsupplying necessary products and services; butat the same time, show that it recognizes theneed to respect and contribute to thecommunities where it operates and to safeguardthe environment. Such a statement of intent helpsto set the scene for describing the company’sforward vision and strategy.
Reveal vision
A company’s vision should look to thesustainability opportunities and challenges ofsupplying energy into the future. The vision willoften be presented in the context of existingcorporate values, principles and policycommitments with reference to: ● quality of products;● safety and reliability of operations; ● care for the environment; ● respect for others and their rights; and● innovation and pioneering solutions.
Explain strategy
A company’s strategy can explain how it plans tocreate value for its shareholders by means of itscurrent performance and—in that context—describe its principal sustainability issues and itsapproach to addressing them. The high-levelvision and strategy are often set out in anexecutive management or chairman’s letter at theopening of the report, increasingly supported bymore detail on the company’s website (with a linkto how sustainability issues are being addressed).This introduction to the report serves todemonstrate top-level personal commitment tosustainability and to involvement in leading thebusiness to achieve the company’s vision andstrategy. The introduction is also an opportunity toshow how management is taking responsibility forany difficult challenges, decisions or dilemmasfaced by the company, and to set out how thesewill be addressed, for example through newinvestments, initiatives or goals.
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Step 1: Articulate vision and strategy
Having articulated the vision and strategy, it isimportant for companies to report on the role ofthe board and/or executives with regard tosustainability-related governance andmanagement systems.
Outline board governance
The report can describe how the board functions,how often it meets, and whether specific boardmembers are associated with sustainability issuesor are members of a related sub-committee,which may include independent advisers. Thereport can also discuss the role of the most seniorexecutives and their structure for managing theday-to-day business. Because the details relatedto governance and accountability do not typicallychange on an annual basis, companies may oftenreport such information on their website: the
sustainability report can then simply refer thereader to the website. However, when changesoccur related to governance, the company shouldconsider whether these have implications relevantto the sustainability report (Step 3) and thepotential need to provide prominent coverage ofthe effects of the changes.
Detail management systems
Robust management systems ensure that thecompany’s values, principles and policycommitments are consistently applied bymanagement across the company. The status,implementation and effectiveness of suchmanagement systems are usually addressed in asustainability report. Companies typically statewhich systems are established, refer to majorchanges as appropriate in their printedsustainability report, and may provide moredetails about the systems on their website. Ifrelevant, companies should explain how theyhave applied international standards or guidancewithin their management systems, for example:International Organization for Standardization(ISO) standards such as the ISO 14000 series orguidance such as ISO 26000; nationalpublications based on the Occupational Health &Safety Advisory Services (OHSAS) 18001standard; or guidance from associations such asOGP or API (see Appendix E, General references).Such systems also underpin the continuousimprovement cycle of planning, execution,monitoring and review. The monitoring step ofthis process is generally based on performanceindicators, many of which can be included in thecompany’s sustainability report. Figure 3 showshow the use of management system informationprovides a foundation that complements andunderpins the indicator information in a report.
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2 Step 2: Describe governance and management systems
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The 2005 edition of the Guidance included indicators to encourage reporting on a company’s environmentalmanagement system, and health and safety management system. This revision recognizes that managementsystems apply across all aspects of sustainability and demonstrate how companies are applying an integratedapproach to managing operational activities with the potential to impact people or the environment.
This approach also recognizes the common characteristics of many sustainability issues and their strategicintegration into business management processes. Thus, a company may not only describe its managementsystems within its report, but also refer throughout its report to risks or challenges that are being addressedthrough specific standards or practices within the system, and disclose the resulting progress and performance.The diagram below shows a typical array of sustainability topics that may be addressed through a company’smanagement system.
Figure 3 Using management systems to support reporting
Because management systems do not change frequently, companies may often describe their systems on theirwebsite and the annual sustainability report can then cross-reference such information. Details may include: • key elements of the system; • accountability and resources for its delivery;• areas of operation, activities and issues covered;• risk assessment, mitigation and management processes; • processes for achieving continuous improvement, including goal-setting, measurement, benchmarking,
training, learning and performance review; and• approaches to meeting compliance with applicable external requirements, standards or guidelines.
Specific examples or short case studies can be included to demonstrate how the company’s managementsystem is applied in practice. For instance, a company might explain how its system ensures that managers areaccountable for assessing environmental and social impacts—and communicating mitigation plans withneighbouring community stakeholders—before starting major projects in new locations.
• revenues • earnings• net cash flow • shareholder return
economicgrowth
sustainability
socio-environment
socio-economic
eco-efficiency
socialprogress
environmentalstewardship
• safety and health • local environmental impact• global climate change • resource management
• diversity• employee satisfaction• human rights• community dialogue• labour standards
• jobs created• skills enhancement• local economic impacts• social investments• business ethics• taxes/royalities
• resource efficiency• product stewardship• life-cycle analysis
• spill prevention• waste minimization• emissions reduction• regulatory compliance• ecosystem services• biodiversity
Given the array of issues that a sustainabilityreport might address, it is helpful to have a simpleand transparent process to determine what toinclude in the report. As described above (underGeneral reporting principles, on page 10), theinformation in a company’s report should berelevant to the report users and should beprovided consistently to enable comparability overtime and between companies. To ensureinformation is relevant, a useful approach is toapply a materiality process that identifies whichissues to include in a report, and their prominence.The company can then select a consistent set ofindicators that provide information on how these‘material issues’ are being addressed. Thisapproach ensures the company is being responsiveto the issues of concern to its stakeholders whileavoiding excessive or unnecessary reporting.
Defining materiality
In the world of financial auditing, the concept of‘materiality’ refers to a threshold—such as apercentage of revenue—to determine whether anissue merits inclusion in a financial report. When itcomes to sustainability reporting, no such simplerule exists for determining which issues should be
included. In brief, material issues for sustainabilityreporting are those that, in the view of both thecompany‘s management and its externalstakeholders, have the potential to significantlyaffect sustainability performance. Managementcan then articulate in the report how these issuesare integral to its business including its vision andstrategy (Step 1). However, what is ‘material’ forsustainability reporting will often differ from whatis ‘material’ for financial or other reporting.
Use a simple process
Companies should establish a simple process toidentify those material issues that warrantinclusion in their report. In practice, a regular(typically annual) review is linked to thecompany’s sustainability reporting cycle. Tools forjudging materiality for sustainability reportingvary and a company needs to determine its ownprocess. Figure 4 provides one option, based ona simple matrix method, that takes into accountboth stakeholder and company viewpoints.
The output of the process can be a list of ‘materialissues for reporting’ that the company mightaddress, with varying levels of prominence,through its communication channels—typicallyprinted annual reports and/or web pages.Certain long-term material issues are likely tohave prominence every year in the sustainabilityreport, with trends over time documented using agroup of consistent indicators. The process mayalso identify new short-term issues, such as majorevents or changes, or specific aspects of long-term issues that may be more significant in aparticular year. The list of material issues forreporting is also a primary input to a company’sdecisions on which indicators to select forreporting, as described in Step 4.
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Material issues forsustainability
reporting are thosethat, in the view ofboth the company‘smanagement and
its externalstakeholders, have
the potential tosignificantly affect
sustainabilityperformance.
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The matrix method starts by gathering information for review from:• external sources that reflect stakeholder opinion, obtained from inputs such as engagement, studies, media,
surveys and compliance; and,• internal knowledge from sources such as strategic plans, risk assessments and performance reports.
The content and form of the inputs will vary from company to company, but the information is typicallyorganized within a spreadsheet. The review consists of classifying the inputs (e.g. activities, topics, events) into‘issues’ that can be assessed to determine whether each is material for reporting. Different approaches exist toassess what is material for a particular company, and organizations may have developed their own. In someinstances, companies may seek stakeholder feedback to test their assessments.
Figure 4 Matrix method for assessing issue materiality
The issues are then mapped onto the quadrants of a simple matrix: • The axis ‘significance to stakeholders’ can be underpinned by identification of principal stakeholders (see
Figure 2, Stakeholder mapping) and defining how to rank their importance (e.g. based on level of influenceon local, national or international fora or media).
• The axis ‘significance to company’ is likely to be drawn from existing internal sustainability-relatedinformation concerning strategic planning and management system processes which are risk based andtherefore differ from company to company. Examples may include uncertainty about the company’s ability todeliver on stated commitments, and associated risks to its reputation, brand value and licence to operate.
The matrix helps to prioritize issues based on relative importance to both the company and its stakeholders.A materiality process allows a company to demonstrate objective reporting criteria that are aligned with thegeneral reporting principles of relevance, transparency and completeness. The process itself can also bereviewed as part of the company’s assurance to increase confidence in the reporting process (Step 6).
High
Medium materiality withexternal concern:Address issue in annual reports withadditional content in corporatewebsites, or by using targetedstakeholder communications
Low materiality:Consider local/regional reportingneeds and monitor the issue butexclude from corporate reporting
Medium materiality withinternal concern:Address issue in corporate websites,with less prominence in annualsustainability reports, or by usingtargeted stakeholder communications
High materiality:Address issue prominently inannual sustainability reportsand corporate websites
Low
High
significance to company
sign
ifica
nce
to s
take
hold
ers
Indicator selection
Identification of a company’s material issues forreporting should inform the selection of indicators.Section 3 of the Guidance introduces 11 issuecategories that are likely to be relevant to manyoil and gas companies for reporting, along with33 performance indicators for use by companies,as appropriate, to demonstrate how the issues arebeing addressed. Companies may choose tocustomize indicators or develop additionalmeasures to report on key issues. Focusedengagement with internal and externalstakeholders prior to reporting may provide usefulearly feedback on indicator selection.
Some factors to consider when selectingindicators: ● Indicators for long-term issues need to be
reported consistently every year, particularly totrack trends in performance against continuousimprovement objectives and to providecomparability within and between companies.
● Other issues may have emerged or increasedin importance over a short period. Thecompany may choose to supplement previouslyused indicators with new measures to improvedisclosures on its associated performance.
● In some instances, a significant or complexissue may relate to more than one of the issuecategories, for instance with social, economic,health, safety and environmental dimensions,and involve reporting against a variety ofdifferent indicators. Step 5 provides twoexamples of reporting on these types ofissues—climate change and energy; andimpacts on communities.
Data collection
Having selected indicators, the next stage is todetermine what quantitative data and qualitativeinformation will be collected within the company.The prominence that the company decides to givea material issue in its report will help to guide thedepth and breadth of data or informationcollected. For each indicator provided inSections 4–6, a choice of ‘reporting elements’ isprovided that may be applicable to the company’soperations, and which define the types ofinformation or data that can be collected: ● Common reporting elements provide
performance measures that are wellestablished across the industry and are a goodstarting point for new reporters or for thoseseeking comparability.
● Supplemental reporting elements providealternate or additional choices of measuresthat provide more depth or differentapproaches.
● Other reporting elements provide furtherreporting options through less-establishedcomplementary measures, or emergingpractices.
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4 Step 4: Select indicators and collect data
Having defined and determined the quantitativedata and qualitative information to be collected,the next step is requesting the data internally,supported by appropriate guidance anddefinitions. Requests for information should betimely: business and operational organizations andfunctions need a reasonable opportunity to collectdata and verify its accuracy. Once received,
corporate data can be consolidated and reviewedfor completeness within the ‘reporting boundary’.(For detailed guidance on the reporting boundaryand on data management, such as establishingbaselines, see Section 3 and Appendix A.)
Figure 5 illustrates the practical application ofSteps 3 and 4.
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A
B
C
D
E
F
List issues that are relevant to the company(e.g. based on management interviews, planning documents, corporate risk processes).
List issues of stakeholder concern(e.g. from engagement, report feedback, media attention or insight via IPIECA and other associations).
Develop materiality matrix, using the two lists from A and B,to determine the material issues for reporting and their relative prominence.
For each material issue, where appropriate, select indicators* suitable for reporting the company’simplementation, progress and performance in addressing the issue.
For each indicator selected, choose common, supplemental or other reporting elements to provideappropriate levels of depth and comparability of reporting, depending on the prominence required.
Collect appropriate quantitative data and qualitative information within the company reporting boundaryfor each selected reporting element, and review accuracy and completeness.
The selection of issues and indicators for reporting is informed by Steps 3 and 4 of the reportingprocess. This example flow chart provides a practical illustration of applying these two steps.
Figure 5 Issue materiality and selection of reporting indicators
* If the indicator choice within the Guidance is not suitable, use other recognized guidance or developin-house measures.
A sustainability report aims to demonstrate,through quantitative and qualitative evidence, thata company is systematically appraising andresponsibly managing its sustainability performance.A major step in the reporting process is to analysethe indicator data and incorporate the results intoa narrative that describes performance progresswithin the context of the sustainability issues.
Putting results into context
Providing context through narrative requires acompany to think strategically about how itcommunicates material issues and relevantindicator data. A report can help to explain thesignificance of a company’s performance byclarifying: ● how the results are relevant to the company’s
operations;● their significance in the context of historic or
recent trends and/or in relation to priorexpectations of performance, such ascontinuous improvement objectives;
● the nature of impacts on relevant stakeholders; ● the opinions of stakeholders or other credible
third parties on those impacts; ● the effect of existing strategy and management
on results; ● how the results may compare to relevant
industry benchmarks or averages; and● strategic responses, goals or lessons learned.
The example on Climate change and energy, onthe following page, illustrates incorporation ofindicator data into narrative where it is importantto provide context for a strategic issue.
Explain progress against goals
Supported by the indicator information and data,the narrative can plot progress against thecompany’s plans to achieve it’s goals, togetherwith explanations for variations in relatedperformance. Continuous improvement is acornerstone of management systems and isgenerally based on a cycle of planning,implementing, measurement (using indicators)and assessment, which results in regularlyupdated improvement plans at the local level.Objectives or targets can be useful indemonstrating progress against plans, andexamples may include:● quantitative targets based on outcomes, such
as reduction of emissions or incidents;● quantitative or qualitative objectives in terms of
inputs, such as completion of managementsystem initiatives by a planned date;
● annual progress measured against acommitment to continuous improvement; or
● case studies providing evidence ofprogrammes planned across a specifiedperiod.
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5 Step 5: Analyse data and incorporate into narrative
Reporting on shortfalls, problems and challengesneed not result in a wholly negative impressionfor readers, if the company also demonstrateshow it is learning and adapting to improveperformance in the future. Indeed, a report thattends to tell just ‘good news’ is unlikely to be seenas providing a credible and complete picture.
Recognize complex issues
In some instances, a material issue may reflectseveral social, environmental or other dimensionsand involve reporting against a variety ofdifferent indicators. These multi-faceted topics areoften associated with specific events or activities,such as an exploration project in anenvironmentally and socially vulnerable location.The example on Impact on communities (overleaf)illustrates the types of narrative and indicatorsthat may be reported for such a complex issue.
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to articulate a clear position on their appraisal ofthe significance of climate change for theirbusiness and how this may relate to thechallenges of meeting growing energy demand.Although it is for each company to develop itsown approach to these issues, the followingnarrative and Guidance indicators may beincluded in a sustainability report: • Corporate policies or statements on climate
change and/or energy and intentions withregard to the carbon intensity of the company’soperations and products.
• Particular strategies, programmes, initiatives andactivities within this area, including commentaryon current and planned performance.
• An explanation of where managementresponsibilities and accountabilities lie for thedelivery of the company’s approach to climatechange.
• An analysis of the outlook for energy supply anddemand and its implications for sustainability,highlighting the opportunities and challenges ofmeeting energy needs while managinggreenhouse gas (GHG) emissions.
• A review of performance over time tomanage GHG emissions (Section 4, E1) andenergy use (Section 4, E2), which couldinclude examples of actions to improveenergy efficiency, reduce flaring, increase useof cogeneration, sequester carbon and/orimprove product use efficiency.
• Discussion of production and investments inother energy sources (Section 4, E3) such asrenewable and alternative energy.
• Communication initiatives or stakeholderengagement on these matters, for example,through public advocacy and lobbying(Section 6, SE14) with regulators, politicians,consumers, public policy forums and tradeassociations.
• Commentary on existing or proposed climatechange laws and regulations, and associateduncertainties and effects on the business.
Example: Climate change and energy
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Employ case studies
Case studies can be a particularly powerful wayto communicate how a company approachessustainability challenges in the everyday conductof its business. Putting indicator data in thecontext of real-world operational challengesillustrates how a company can work effectively to
manage and integrate sustainability performanceinto its operations. The example on Working inremote locations (opposite) shows how casestudies can be built on specific indicatorinformation to link a company’s global approachto addressing issues at the local level.
Oil and gas company activities can be very largeundertakings in physical and economic terms.They may bring many benefits for hostcommunities. They may also involve a range ofimpacts relating to health and safety, economic,social and/or environmental concerns. Reportingcompanies need to balance reporting at acorporate level with attention to particular localsituations. (See Working in remote locations,opposite). A company’s materiality appraisal(Step 3) will usually identify the specific locationsthat warrant detailed coverage. Some aspectsthat reporters may wish to consider include:
• corporate policies or programmes with respectto communities, including specific objectivesand engagement activities (Section 6,SE1–SE4);
• descriptions of local context and particularimpacts regarding the local environment,community health and safety and local socio-economic circumstances; supported byindicators such as:- local hiring practices, local procurement
and supplier development (Section 6,SE6, SE7);
- preventing corruption (Section 6, SE11); - human rights (Section 6, SE8–SE10);- biodiversity and ecosystem services, and
fresh water (Section 4, E5, E6); and- other air emissions, spills to the
environment, discharges to water and waste(Section 4, E7–E10);
• local engagement, concerns and expectations,and strategies to address them; and
• independent reviews or lessons learnedregarding community impacts.
Example: Impact on communities
Table 1 Typical financial and operatinginformation data
Incorporating financial data
Another useful approach is to incorporateselected financial and operating information toprovide business context when reporting onsustainability issues. Typically these data arealready publicly available and should be drawnfrom a company’s annual financial report toensure consistency. In a sustainability report,basic financial and operating information—seeTable 1 for suggested items—can appear ashighlights or in a summary data table. Althoughfinancial data are generally reported at theglobal level, it may help to report selectedinformation at a national or regional level.Companies may also consider reporting anylarge acquisitions or divestments in the reportingyear if the changes materially affect the size andscale of the company.
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Example: Working in remote locations
The oil industry increasingly works in remote locations,often in developing countries or in sensitive environments.In such areas of the world, sustainability issues can beparticularly acute and care must be taken to respectecosystem services and the rights of local communitiesor indigenous people. The materiality of issues in suchcircumstances can be significant for stakeholders at alocal level. In such cases it is more appropriate todevelop narrative using a case study that demonstrateshow corporate strategy and values are applied to thespecific circumstances in the remote location. Forexample, a case study to describe activities in a locationwhere there are risks of impacting freshwater availabilityand affecting community relationships might provide:• the strategy behind the company’s activities and an
overview of the sustainability risks for the remotelocation;
• the high-level corporate strategy for operating inwater-stressed regions; and company approaches tomanaging community impacts and engagement,supported by indicators (Section 4, E6 andSection 6, SE1);
• an explanation of the local water-stress risks,management plans and progress to minimize theenvironmental impact of freshwater used by theoperations;
• a description of the successes, challenges andoutcomes of the local community engagement(Section 6, SE1), stating any future commitmentsmade by the company; and
• stakeholder or expert third-party opinion and/ordata that provides additional perspective.
• Total revenues
• Operating expenses
• Total taxes paid
• Profit after tax
• Capital expenditure
• Number of employees
• Number of countries of operation
• Total production (upstream)
• Total throughput (downstream)
Inclusion of information to provide assurance onthe content of sustainability reports is a commonpractice. Assurance processes provide an opinionregarding the quality of reported information andcan emphasize application of the Generalreporting principles (page 10). Companiesgenerally have their own internal assurancemechanisms, but external assurance, in addition,may enhance the perceived credibility of asustainability report. External assurance tends totake the form of audit-based verification or third-party commentary. Both methods may co-exist ina single report, but they are distinct processes.
● Audit-based verification typically focuses onquantitative information, including datasystems and interpretation. These audits arecommonly undertaken by accountancy andconsulting firms, and are typically seen as a‘formal’ approach. Audit-based verificationmay also seek to test materiality processes orassess qualitative statements or claims relatedto commitments, vision and strategy, orgovernance and management systems. Thisapproach may include assurance againstspecific standards, such as:
• The International Standard on AssuranceEngagements (ISAE 3000), which isprovided by the International Audit andAssurance Standards Board (IAASB), part ofthe International Federation of Accountants(IFAC). This standard covers the professionalprocedures undertaken by an assuranceprovider and is binding on IFAC members,including major accounting and consultingfirms. A choice of two levels of assurance isprovided—‘limited’ is a high-level review,while ‘reasonable’ is a more rigorous, in-depth process in which the auditors providean opinion that the data are reliable.
• The AA1000 Assurance Standard, whichwas developed by the Institute for Social andEthical AccountAbility, evaluates andprovides conclusions on the nature andextent of adherence to the AA1000Accountability Principles of Inclusivity,Materiality and Responsiveness and, ifdesired, the quality of publicly disclosedinformation on sustainability performance.
Both ISAE 3000 and AA1000 provide severaloptions for the type and level of assurance thatmay be obtained under the standard.
● Third-party commentary ranges fromstatements by reputable experts in particularareas, to the use of a stakeholder panel orinclusion of academic, non-governmentalorganization (NGO) or community comments.The statements may include views onmanagement performance, progress andrecommendations. They may also provide anopinion on whether the report includes themost relevant and material issues, butgenerally do not comment on the reliability oraccuracy of information or data.
It is important for companies to explain in theirsustainability report how they achieve assurance,e.g. through internal or external audits, orthrough third-party review and any othersupplementary approaches.
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Section 3: Issues and indicators
What to report
The six-step process outlined in the previous sectionadvised companies on developing the content of asustainability report. This section provides genericadvice on data management and normalization,and introduces the detailed guidance on issues andindicators for reporting, which is set out in thefollowing three sections of the Guidance.
Overview of issues and indicators
Sections 4, 5 and 6 introduce sustainabilityindicator and issue ‘categories’ important to theoil and gas industry—environmental; health andsafety; and social and economic—as shown inTable 2. Each category was represented by atechnical working group of industry experts (i.e.representatives from oil and gas companies andassociations). These individuals brought togetheryears of experience on development ofsustainability-related metrics. The selection ofissues and indicators was a consensus processusing the knowledge of the working groups andinput from stakeholders inside and outside theindustry, including the Stakeholder Panel.
Collectively, the three categories cover 11sustainability issues that are prevalent for the oiland gas industry and are therefore likely to bematerial for reporting by many oil and gascompanies. Section 2 outlined a materialityprocess that helps determine which issues arerelevant to an individual company and itsstakeholders. A company may decide that severalor all of the issues in Table 2 are material forreporting, and may also identify additionalmaterial issues or sub-issues which are notcovered in this Guidance but are specific to thecompany’s activities or operational locations.
Sections 4, 5 and 6 also introduce the 33performance indicators, using definitions that are
specific to this Guidance and the oil and gasindustry. Table 2 shows how the indicators havebeen grouped within the 11 issues. For ease ofuse, each indicator is associated with an issue,and is presented using a standard indicatortemplate which is provided at the end of thissection. Any one performance indicator mayprovide information relevant to several issues, andsome indicators may relate to all three categories.Users of the Guidance should keep in mind thepotential for any indicator to be relevant toseveral issues simultaneously.
Within the subsequent sections, the Guidanceprovides an introduction to each issue that mayhelp companies construct their report narrative.Where overlaps exist between the issues,companies may choose to combine aspects undera single inclusive narrative.
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Table 2 Indicators and issue categories
Environmental issues (Section 4):
• Climate change and energy (4 indicators)
• Ecosystem services (2 indicators)
• Local environmental impacts (4 indicators)
Health and safety issues (Section 5):
• Workforce protection (3 indicators)
• Product health, safety and environmental risks (1 indicator)
• Process safety and asset integrity (1 indicator)
Social and economic issues (Section 6):
• Community and society (4 indicators)
• Local content (3 indicators)
• Human rights (3 indicators)
• Business ethics and transparency (4 indicators)
• Labour practices (4 indicators)
Reporting elements
A key opportunity in undertaking this revision wasthe introduction of steps to help new reporters getstarted while providing enhanced comparabilityfor existing reporters. This Guidance introducescommon, supplemental and other reportingelements for all indicators, to provide a strongerfoundation for defining reporting options (Table 3).
When using reporting elements, reporters areencouraged to follow the General reportingprinciples of completeness and accuracy byincorporating information consistent with theindicator scope and reporting boundary, and bydescribing the reported information with as muchspecificity as possible. When reporting oncomplex issues, an external view may provideadditional insight and support explanations.
Quantitative and qualitative reporting
Reporting elements can be either quantitative orqualitative, which provides further options forreporting. Quantitative information is reported asa number with a dimensional unit or numericalindex that can be used to show performancetrends over time against a baseline. Qualitativeinformation reporting uses narrative descriptionsabout a company’s approach to address aspectsof an issue, often by describing a company’spolicies, procedures or actions, evidenced byexamples or case studies.
Many indicators are well suited to quantitativemeasurement—environmental emissions ordischarges, or numbers of safety incidents—andthey typically have common reporting elementswith numeric outcomes. However, social andeconomic indicators do not always lendthemselves to quantification and the common
reporting elements are generally qualitative.Where indicators have both quantitative andqualitative elements, they offer greater reportingflexibility. This can be useful when informationmay be more meaningful at a local or nationallevel (rather than at the global, corporate-widelevel on which most reports are constructed). Theexample on Spills to the environment andProcess safety (overleaf) illustrates oneapplication of the reporting elements.
Cases may exist where a company applies aquantitative indicator in a more qualitativefashion, based on the maturity of the company’sdata collection process. For instance, companiesmay start out by describing operationalperformance through the use of anecdotalexamples, local case studies or limited datagathered for a subset of operations. In time, theseanecdotal descriptions may converge into a morecomplete, objective and quantitative index formeasuring performance or assessing impacts.
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Section 3
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nd in
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Table 3 Definitions of reporting element terms
Common reporting elements:
Measures for tracking performance progress that are wellestablished across the industry and offer a starting pointfor new reporters, as well as greater comparability forexisting reporters and report readers.
Supplemental reporting elements:
Alternate or additional measures that have been appliedsuccessfully by some reporters and provide more depth ordifferent approaches to describe how an issue is beingaddressed.
Other reporting elements:
Less-established complementary measures, or emergingpractices, that provide further options to develop acompany’s report.
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This example demonstrates the applicability ofcommon, supplemental, and other reporting elements,through two indicators—Spills to the environment (E8)and Process safety (HS5). These indicators are alsoexamples that provide primarily quantitative, but alsoqualitative, information for reporting.
‘Loss of containment’ is one of the most critical risks forthe industry to manage due to the potential forinadvertent environmental impacts or harm to people.Release of hydrocarbon liquids to land or water—anoil spill—can result in significant pollution orcontamination. Release of light hydrocarbon gases orliquids, if ignited, may cause a fire or explosionresulting in serious injuries, fatalities, damage toproperty and/or emissions to the atmosphere. Theindustry is aware of these risks and ensuring the safetyof operations is frequently stated as the highest priorityfor companies. Although mitigation of these risks isbetter today than decades ago, risk is always present.In recent years, severe accidents have drawn attentionto the potential consequences of major incidents.
For oil and gas companies and their stakeholders, theindicators E8 on Spills to the environment and HS5 onProcess safety are very likely to be materialenvironmental and safety issues for reporting, and aresupported by primarily quantitative reporting elements.While E8 is well established, HS5 is a new addition tothe Guidance that has been recently introduced acrossthe industry to track process safety (asset integrity)events resulting from gas or liquid loss of containment.
The common reporting elements of E8 reflectestablished practice in the industry to report thenumber and total volume spilled of all hydrocarbonspills (greater than one barrel) that reach theenvironment. A second common element encouragesqualitative discussion of impacts and response actionsfor significant spills, as determined by the company. A
third common element seeks a description of companyemergency preparedness and response programmes,plans, organizational structures and affiliations for aneffective response to spills and other emergencies.Some companies, having assessed the materiality of oilspill risks (Section 2), may use one or more of thesupplemental reporting elements to report in moredetail. This could include reporting the hydrocarbonrecovered from spills, separate reporting for spills tosoil and to water, or reporting hydrocarbons spills bybusiness activity (e.g. refining, production, etc.).
The common reporting elements of HS5 are based on arecommended practice published by API, which defineshow to record the number and frequency of significantprocess safety events resulting from loss of primarycontainment. Companies may choose to extend theirreporting by also including less significant processsafety events using the supplemental reporting element.
Companies with extensive operations transporting highvolumes or a wide range of products may considergiving even greater emphasis in their reporting to oilspills or process safety. For both indicators, companiescan consider a range of options suggested under otherreporting elements, such as more qualitative or leadingmeasures of performance.
Example: Spills to the environment and Process safety
Data management
In selecting relevant indicators, companies shouldpay attention to the following challenges in datacollection and management:
● Reporting boundaries: Having selected anappropriate set of indicators and reportingelements, consistency in collecting quantitativeor qualitative data for inclusion in the report isimportant. Clear definitions of what is in, andwhat is out, of the data collection need to beestablished. These definitions are normallyreferred to as the company’s ‘reportingboundaries’. These may differ for differentindicators but should be consistent from year toyear and between the organizational units ofthe company. Defining the reporting boundaryis an important consideration. An indicator’sscope may often require data from a complexrange of organizational entities engaged indifferent commercial arrangements, such asjoint ventures. Normalization of quantitativedata requires consistency between theindicator data and normalization factor toachieve comparability over time. (See Datanormalization, overleaf.)
In Sections 4, 5 and 6 of the Guidance,boundary-related information is included in theScope section for each indicator. However,companies are encouraged to define anddocument an overall boundary for collectingsustainability data.
A number of protocols exist for settingboundaries. For example, both IPIECA and GRIhave protocols for GHG emissions, and OGPhas specific practices for upstream reporting ofsafety and environmental data. Appendix Asets out a three-step process intended to helpcompanies define practical boundaries fortheir sustainability reporting. This processpromotes consistency within reports, supports
comparability between companies andfacilitates inter-company benchmarking(although benchmarking of performance willusually require more explicit and detailedstandardization of boundaries for individualindicators).
● Establishing baselines: Many companiesestablish baselines to maintain dataconsistency and to track performance overtime. This facilitates internal performancemonitoring and decision-making and helpsdemonstrate progress towards goals from adesignated starting point or base year. Theselection of a reference year should take intoaccount the quality of historical data and thefrequency and/or significance of unusualevents. When a company acquires or divestsassets, resulting discontinuities in data canmake performance trends difficult to interpret.In such cases, incorporating baselineadjustments would help the report reader inunderstanding the data. Such adjustmentsneed to be clearly documented andcommunicated to ensure transparency.
● Consistent reporting periods: Reportingcompanies are encouraged to publish reportson a regular schedule. Typically, reporting inthe oil and gas sector is annual, or everysecond year, with annual data reflectingcalendar years.
● Information quality: Reporting companies areencouraged to describe how quantitative dataand/or qualitative information are producedusing management protocols for collection andreview of information. Companies shouldprovide appropriate information on dataquality in terms of its source, how it wasassessed and the degree of confidence in itsaccuracy.
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● Data consolidation: companies can reportperformance data at varying levels ofaggregation, ranging from individual sites orfacilities to national/regional locations and toglobal coverage for the entire corporation.Companies should determine aggregationlevels for reporting on issues and, ifappropriate, these levels should also allow fornormalization based on categories of businessactivity, such as those provided in Table 4. It isoften useful, for example, to separate upstream(i.e. exploration and production) activities fromdownstream activities. Exploration andproduction activities can be defined byreference to the annual updated OGPguidance on collection of safety andenvironmental data. Downstream activities maybe considered to encompass all other activitiesof the company; however, for normalized datato enable meaningful interpretation ofperformance, it is often necessary to separatespecific downstream activities. (See Datanormalization, below.) Regional breakdownsof data can also provide important insights onoperating performance and differencesbetween companies. Appendix A providesguidance on approaches to data consolidationwith respect to reporting boundaries.
Data normalization
Internal and external users of sustainabilityperformance results are generally interested intwo types of indicator data presentation: ● Absolute quantities are values presented to
reflect the full magnitude or size of an output,input, value or result. Such values can typicallybe expressed using a physical unit ofmeasurement related to weight, volume,energy or financial value. In general, absolutequantities can be expressed in units ofmeasurement that are readily convertible. (SeeAppendix D, Measurement units andconversion factors.)
● Normalized quantities are relative valuespresented as ratios between two absolutequantities of the same or different kind.Typically, indicator data are the numerators ofthe ratio, and a suitable normalization factoris selected as the denominator. Normalizedquantities allow comparisons of indicator databetween operations of different size, andfacilitate comparisons of similar products orprocesses. These ratios help compare theperformance of one company, business unit ororganization to those of another. Normalizedindicators can provide information on theefficiency of an activity, on the relative intensityof an output (e.g. energy intensity) or on therelative quality of a value or achievement.
Companies report normalized performanceindicators for a number of reasons, including:● tracking performance over time;● comparing performance between similar
business operations within the company; and● benchmarking performance with other
companies.
Reporting performance based on both absoluteand normalized quantities is good practice and
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can provide a more complete and balancedrepresentation of sustainability performance andprogress.
However, it is not always appropriate tonormalize data, especially where there is no well-defined relationship of scale between the absolutequantities and the normalization factors. Thus,reporting normalized data can present achallenge because different normalization factorsare needed for different activities and for differentpurposes. In general, companies shouldnormalize performance indicators in ways that
align with business decision-making and in waysthat allow clearer communication of performanceto stakeholders; for example by reportingnormalized data separately for oil and gasproduction activities versus refining orpetrochemical operations.
Normalization factors vary based on specificindicators. For example, for safety and healthindicators the absolute quantity of workforceoccupational injuries and illnesses can also bereported as the normalized rates of injuries orillnesses by using the number of hours worked bythe workforce as a normalization factor.
Environmental performance indicators aretypically normalized using absolute quantities ofrelated outputs (e.g. emissions per unit productionfrom a process). Since the relative magnitude ofthese outputs can vary substantially for differentoil and gas processes or products, it is generallynecessary for companies to report normalizedenvironmental data for each business activityseparately, so that performance can bemeaningfully evaluated. Recommendednormalization factors are provided in Table 4.
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Table 4 Recommended normalization factors for environmental performance data
Oil and gas industry activity
Exploration and production (upstream)
Refining
Transportation and terminals
Pipeline
Marketing (retail)
Marine
Petrochemicals
Normalization factor
Wellhead production of crude oil, condensates, natural gas liquids and drygas (including flared gas and gas used for fuel but excluding gas reinjectedinto the reservoir) on an operated basisNote: equity share GHG emissions may be normalized using net exportproduction on an equity share basis, as in financial reporting.
Refining throughput of crude oil and other feedstock
Product delivered or terminal throughput
Pipeline throughput
Motor fuel sales
Cargo volume transported
Petrochemicals production
Standard indicator format
For ease of reference, each indicator described in Sections 4, 5 and 6 is organized using the templatebelow.
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Number and name of indicator
Description: briefly conveys the overall intent of the indicator, in particular for the common
reporting elements.
Purpose: provides the reasoning behind the use of the indicator, including its potential relevance to
a company in the oil and gas industry.
Scope: describes the indicator and reporting elements in terms of applicability with any relevant
qualifying information; a separate list of aspects that are ‘out of scope’ or ‘not included’ may also
be provided.
Reporting basis: defines measurement units (if applicable), and data consolidation/boundary
considerations.
Definition of terms: offers a short specific glossary that clarifies terms specific to the indicator.
Reporting elements: summarized in a table:
References: help with sourcing and compiling data
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Measures for tracking performance progressthat are well established across the industryand offer a starting point for new reporters,as well as greater comparability for existingreporters and report readers.
● Alternate or additional measures that havebeen applied successfully by somereporters and provide options for moredepth or different approaches to describehow a material issue is being addressed.
● Less-established complementary measures, or emerging practices, that provide further optionsto develop a company’s report.
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Section 4:
Environmentalindicators
Environmental indicators
The oil and gas industry recognizes that itsoperations have potential impacts on theenvironment. Some of the environmental impactsmay also have health, safety, social and/oreconomic implications. Companies in the industrygenerally have systematic processes in place tomanage and reduce environmental impacts. Theten indicators in this section, grouped in three issuecategories, describe the environmental systems,progress and performance of company operations.
Consolidation and normalization ofenvironmental data
For environmental indicators, a company generallyconsolidates performance data for operated assetsby applying the reporting boundary ‘operationalapproach’, except for GHG emissions where boththe ‘operational approach’ and the ‘equity shareapproach’ may be applied (Appendix A).
Indicators for spills, emissions and wastes can beexpressed as absolute and/or normalized
quantities. Absolute measures provide informationon the scale of releases at the corporate, regionalor local level. Normalized quantities facilitatecomparisons among similar operations ofdifferent sizes (Section 3). Because of the varyingprices of oil and gas, normalization based on themonetary value of outputs is not recommended.Instead, environmental data should be normalizedbased on physical outputs such as production orthroughput (Table 4, Section 3). Care is requiredto account for the differing nature of specificoperations. Emissions from oil production, forexample, vary depending on the need forenhanced oil recovery techniques and whetherassociated gas produced with the oil is flared orcaptured for sale. Similarly, refining emissionsdepend on the type of crude oil processed andthe mix of products produced. One approach todealing with process and/or feedstock differencesis to normalize data using a weighted measure ofproduction or throughput. A good example isSolomon Associates’ Utilized EquivalentDistillation Capacity, which factors in thecomplexity of a refinery’s processes.
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Summary of environmental indicators
Issue category Indicator Page number
Climate change and energy E1: Greenhouse gas emissions 36 E2: Energy use 40 E3: Alternative energy sources 43 E4: Flared gas 45
Ecosystem services E5: Biodiversity and ecosystem services 48 E6: Fresh water 51
Local environmental impact E7: Other air emissions 55 E8: Spills to the environment 57 E9: Discharges to water 60 E10: Waste 62
Environmental indicators Climate change and energy
Addressing the challenges and risks posed byclimate change requires sustained efforts todevelop understanding and effective responsewhile meeting growing global needs for energy.Oil and gas will probably continue to account fora high proportion of primary energy demandglobally for decades to come. Companies in theoil and gas industry endeavour to meet theseenergy supply needs. At the same time, theycontinue to take action to improve theiroperations and products, to promote and improveenergy efficiency and to minimize greenhousegas emissions. As a result, climate change is likelyto be a material issue for the oil and gas industryfor years to come. As illustrated by example inSection 2, climate change and energy is acomplex issue with implications for otherenvironmental, social, health and economicissues. As such, a company may decide that other
aspects of this issue, beyond the four indicatorssuggested in this Guidance, may be material forinclusion in its sustainability report.
The four indicators recommended are common tomany companies. Of these, greenhouse gas(GHG) emissions metrics are well established andthis indicator is only part of the extensivereporting protocols available to oil and gascompanies from IPIECA, API, OGP and others.Energy use and flared gas are indicators ofnatural resource use, and are directly associatedwith GHG emissions; they are also related to localenvironmental impacts, and affect otherenvironmental issue areas. Alternative energysources is an indicator that enables reporting oncompany investments in identifying and providingalternative and/or new renewable solutions.
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Introducing the issue:Climate change and energy
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Environmental indicators Climate change and energy E1: Greenhouse gas emissions
Description
Report quantity of greenhouse gas emissions,including carbon dioxide and methane, fromcombustion and other processes.
Purpose
Greenhouse gases are generated by mostpetroleum industry operations and contribute toaggregate global atmospheric GHG concentrations.This indicator demonstrates how companies trackand manage their GHG emissions.
Scope
The following scope summarizes key aspects ofthe IPIECA/API/OGP Petroleum IndustryGuidelines for Reporting Greenhouse GasEmissions which is recommended for accountingand voluntary reporting of GHG emissions in thepetroleum industry and should be referred to fordetailed guidance on this indicator.
Oil and gas companies should includesignificant GHG emissions to the atmosphere ofsix greenhouse gases covered under the KyotoProtocol:● carbon dioxide (CO2)● methane (CH4) ● nitrous oxide (N2O)● hydrofluorocarbons (HFCs) ● perfluorocarbons (PFCs) ● sulphur hexafluoride (SF6)
For oil and natural gas operations, CO2 and CH4
are usually the most significant components ofGHG emissions. N2O is emitted in very smallquantities from the combustion of fossil fuels andits GHG contribution may be insignificantcompared to CO2. Depending on the company’soperations, the other greenhouse gases—HFCs
and PFCs used in refrigeration, and SF6 used inelectrical equipment and sometimes as a tracer inpipelines—may or may not make a substantialcontribution relative to the total GHG emissionsfrom a company’s operations. For each listedGHG determined to be a significant contributor tototal emissions, it is good practice to reportannual emissions in metric tonnes and/or theCO2 equivalent (CO2e) of each GHG, where theCO2e is calculated in accordance with publishedglobal warming potential (GWP) factors. Todate, the preferred source for global warmingpotential factors is the IPCC’s Second AssessmentReport (1995).
GHG emissions from all company businessactivities should be included: ● combustion emissions (e.g. fuel use in gas
compression, power generation, heating, cokeburn);
● flaring and venting;● process emissions (e.g. vessel loading, tank
storage and flushing, glycol dehydration,sulphur recovery units, hydrogen production);
● fugitive emissions of GHG gases (includingpiping and equipment leaks); and
● non-routine events (e.g. pipeline maintenance,gas releases, equipment maintenance).
GHG emissions estimates should includesignificant stationary and mobile sources.Stationary sources may include equipment at wellsites, production facilities, refineries, chemicalplants, terminals, fixed site drilling rigs and officebuildings. Mobile sources may include marinevessels transporting products, tank truck fleets,mobile drilling rigs, and moveable equipment atdrilling and production facilities.
Direct GHG emissions result from equipment orother sources owned (partly or wholly) and/oroperated by the company. These correspond to
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Environmental indicators Climate change and energy E1: Greenhouse gas emissions
Scope 1 emissions as defined by the WorldResources Institute and the World Business Councilon Sustainable Development (WRI/WBCSD)Greenhouse Gas Protocol. Where an operationpurchases energy already transformed intoelectricity, heat or steam, the GHGs emitted toproduce this energy should be reported as IndirectGHG emissions from imported energy (Scope 2emissions per the WRI/WBCSD Greenhouse GasProtocol). Some companies choose to report Otherindirect emissions (Scope 3 emissions per theWRI/WBCSD Greenhouse Gas Protocol) whichrepresent the indirect emissions that result from acompany’s activities that are not Scope 2 emissions.
The common reporting elements (see page 39)are based on direct GHG emission reporting; oneof the supplemental reporting elements providesfor reporting indirect GHG emissions. Where partof an asset’s direct emission relates to exportedenergy, it can be separately accounted for inother reporting elements.
Based on current practice, the following are nottypically included by companies in their GHGemissions reporting: ● ozone-depleting gases such as
chlorofluorocarbons (CFCs) andhydrochlorofluorocarbons (HCFCs), since theseare not among the six Kyoto gases; and
● CO2 sold as product, used for enhanced oilrecovery, or sequestered (e.g. via carboncapture and sequestration).
Reporting basis
Total emissions are reported quantitatively at thecompany level as CO2e (reflecting the globalwarming potential of all of the GHG species) andas emissions of the individual gases expressed inmass and/or CO2e. Measurement units are:● Total GHG (direct, indirect from imported
energy, direct GHG for exported energy):metric tonnes CO2 equivalent (whereCO2e = the sum of the products of each GHG
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Environmental indicators Climate change and energy E1: Greenhouse gas emissions
gas multiplied by its respective GWP relative toCO2, in metric tonnes); and
● GHG species (i.e. when reporting individualgases): metric tonnes and/or metric tonnesCO2 equivalent (where CO2e = the product ofmetric tonnes of the GHG species of interest byits GWP relative to CO2).
Companies should clearly identify the specificGHG species included in their emission estimates.
Data should be consolidated within the company’sreporting boundary using either the ‘operational’or the ‘equity share’ approach, or bothapproaches (Appendix A), and can consider thealternative ‘financial’ approach. Reportingboundaries and these data consolidationapproaches are defined and discussed in detail inChapter 3 of the IPIECA/API/OGP PetroleumIndustry Guidelines for Reporting GreenhouseGas Emissions. Companies should clearly statethe consolidation approaches used.
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Definition of terms
• Direct GHG emissions: total GHG emitted from sources at a facility owned (partly or wholly)and/or operated by the company. Direct GHG emissions correspond to Scope 1 emissions asdefined by WRI/WBCSD.
• Indirect GHG emissions from imported energy: GHG emissions that occur at the point of energygeneration (owned or operated by a third party) for electricity, heat or steam imported (i.e.purchased) for use on site by the reporting entity. Indirect GHG emissions from imported energycorrespond to Scope 2 emissions as defined by WRI/WBCSD.
• Direct GHG emissions from exported energy: GHG emissions related to production of energy inthe form of electricity, heat or steam exported (i.e. sold) by the reporting entity to a facility ownedor operated by a third party. This is a subset of direct GHG emissions.
• GHG intensity: GHG emissions divided by the appropriate normalization factor for the businesssegment. This metric can be useful in comparing performance within a company’s businesssegments (e.g. within production or within refining). See Section 3 for additional information onnormalization.
• Direct GHG emissions from cogeneration: GHG emissions related to production of electricity andsteam in cogeneration (simultaneous production of power and useful heat). This subset of directGHG emissions typically results in a reduction of GHG emissions from a public utility.
• Other indirect emissions: Correspond to Scope 3 emissions as defined by the WRI/WBCSD GHGProtocol, and as described in detail in the IPIECA/API/OGP Petroleum Industry Guidelines forReporting Greenhouse Gas Emissions. They represent indirect emissions that result from acompany’s activities that are not Scope 2 emissions. Examples include emissions from themanufacture of purchased raw materials (such as hydrogen or steel), emissions from third-partyvessels or vehicles transporting company products or employees, or emissions from customer use ofthe company’s fuel products.
Environmental indicators Climate change and energy E1: Greenhouse gas emissions
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References
1. API. 2009. Compendium of Greenhouse Gas Emission Estimation Methodologies for the Oil and Natural Gas Industry.www.api.org/ehs/climate/new/upload/2009_GHG_COMPENDIUM.pdf
2. IPCC. 1995. Second Assessment Report—Climate Change 1995: The Science of Climate Change.www.ipcc.ch/ipccreports/sar/wg_I/ipcc_sar_wg_I_full_report.pdf
3. IPCC. 2007. ’Changes in Atmospheric Constituents and in Radiative Forcing‘ (Chapter 2), in Climate Change 2007: The PhysicalScience Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on ClimateChange (2007) [Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M.Tignor and H.L. Miller (eds.)].Cambridge University Press. www.ipcc.ch/pdf/assessment-report/ar4/wg1/ar4-wg1-chapter2.pdf
4. IPIECA/API/OGP. 2011. Petroleum Industry Guidelines for Reporting Greenhouse Gas Emissions. Scheduled for publication in2011. www.ipieca.org
5. WRI/WBCSD. 2004. The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (Revised Edition, March,2004). www.wri.org/publication/greenhouse-gas-protocol-corporate-accounting-and-reporting-standard-revised-edition
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Direct GHG emissions (Scope 1),consolidated using either the operationalor equity share approach, to include:• direct CO2
• direct CH4
● Direct GHG emissions (Scope 1), consolidatedusing both operational and equity shareapproaches.
● Indirect GHG emissions related to purchasedenergy (report separately from direct emissions)(Scope 2).
● Separately report GHG species which contributesignificantly to total direct GHG emissions(Scope 1).
● GHG emissions and/or intensity, by businessactivity (e.g. oil and gas production, refining).
● Breakdown of major source categories for GHG emissions (e.g. combustion [stationary], flaring,venting, process, product transport). Companies should discuss their approach to managing GHGemissions overall or within the source categories. For example, describe strategies to improve energyefficiency, reduce flaring, increase use of cogeneration, sequester carbon and improve the efficiencyof the use of the company’s products.
● Emissions related to activities of special interest (e.g. oil sands) can be noted separately if theserepresent a substantial portion of the company’s GHG profile.
● Separately report substantial direct GHG emissions associated with the cogeneration of heat andpower.
● Separately report substantial direct GHG emissions related to generation of energy exported. ● Companies may choose to separately report other indirect GHG emissions (WRI/WBCSD Scope 3),
for example those related to use of petroleum products: see also the IPIECA/API/OGP PetroleumIndustry Guidelines for Reporting Greenhouse Gas Emissions.
Reporting elements
Environmental indicators Climate change and energy E2: Energy use
Description
Report total quantity of energy consumed in oiland gas operations or other business activities.
Purpose
Energy use is an indicator of resource use and isassociated with the generation of GHGs andother air emissions. Energy-related emissions tothe atmosphere are aggregated within indicatorsE1, GHG emissions and E7, Other air emissions.
Scope
Reporters should state the total energy consumedto operate their facilities and equipment. Thisincludes the direct energy produced by operations(less any energy exported), as well as energyassociated with the import of electricity, heat andsteam. To reflect resource use, energy is reportedas primary energy (i.e. the energy content of thehydrocarbon fuels or other sources used toproduce the energy ultimately consumed by thecompany’s operations).
Direct energy results from self-generation ofmechanical power, electricity, heat or steam onthe company‘s operating sites, as well as in officebuildings, marine vessels, trucks, or otherstationary or mobile equipment under theoperational control of the reporting company.Examples of energy-consuming equipmentinclude boilers, fired heaters, waste incinerators,gas turbines, gas engines and diesel engines.Direct energy use is a measure of the energycontent of the fuels or other energy sources usedto produce the power or heat generated directlyat the facility.
Direct energy should reflect combustion of fuels,whether produced by the company or purchased.
Energy from fuel combustion should bedetermined as follows:● Preferred: calculated based on the fuel volume
consumed and the fuel energy content of thefuels used to generate the required energy.Calculation may be carried out by total fuelconsumed if the same fuel is used by allenergy sources, or by source if fuel types vary.Use of ‘lower heating value’ is recommendedbecause this reflects the amount of useableenergy consumed and its use will promote aconsistent reporting basis. Use of ‘upperheating value’ in place of ‘lower heating value’will increase the reported energy consumptionby up to 10%.
● Alternative: estimate based on the designenergy consumption specifications associatedwith various processing equipment, augmentedwith run time or throughput information ifavailable.
On-site generation of solar or wind electric poweror other non-combustion energy sources shouldbe included and calculated simply from theelectricity generated by these sources.
Exported energy is the subset of the directprimary energy sold or otherwise exported fromthe facility for use by others. It includes energylosses from the company‘s own power generationequipment.
This indicator quantifies energy use related to oiland gas operations and, therefore, excludesexported energy not available to support on-siteoperations. As a consequence, companies withmaterial export contributions from power plantsor cogeneration plants may choose to reportenergy use related to generation of exportedpower separately to provide a clearer picture ofoverall resource use.
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Environmental indicators Climate change and energy E2: Energy use
Imported energy should reflect the energy contentof the fuels that the supplier uses to produceelectricity, heat or steam imported by thecompany. This approach is used to reflect the useof primary energy resources. For example,imported energy derived from a thermal powergeneration plant would be the energy content ofthe fuel combusted by the provider to produce theelectrical power received by the company‘sfacility. Imported energy accounts for theefficiency loss during the transformation of fuelcombusted at the power plant into electricity, heator steam.
Imported energy is calculated by using thepurchased records of electricity, heat or steam,and then using efficiency factors to convert back tothe energy content of the fuels or energy sources.For purchased electricity, the imported electricity isconverted to an estimate of the energy actuallyused by applying a local ‘grid factor’ that reflectsthe average thermal efficiency (i.e. energy contentof the fuel versus energy produced) for the mix ofelectrical generation facilities providing electricityto the local electrical grid. For purchased heat orsteam, efficiency factors can typically be obtainedfrom the supplier.
In the absence of efficiency or grid factors,including specific information from the energyprovider, it is possible to use published gridfactors such as those provided by the APICompendium, the US EPA E-GRID factors or othersources available in the country of operation.Alternatively, it may be necessary to usepublished conversion factors and information onthe type of generating unit supplying the energy.In the absence of local or regional information,the following efficiency factors can be used forcombustion-based energy sources:
● energy content of the fuel used to generate theelectricity = electricity purchased/received ingigajoules (GJ) divided by 0.38
● energy content of the fuel used to generate thesteam = steam purchased/received in GJdivided by 0.8
The factors provided are conservative values toaccount for efficiency losses during generationand transportation of power but do not reflect theefficiency of the most recent power generationtechnology. If electricity imported comes solelyfrom non-combustion and non-nuclear generation(e.g. wind, hydroelectric, wave, tidal power) thereis no need to apply a grid factor; simply reportthe imported energy purchased.
Total energy use reported should include directenergy and imported energy but excludeexported energy to quantify energy consumed bya company’s oil and gas operations.
Out of scope
The energy content of flared or vented gas shouldbe excluded from total energy use estimates.Although these do reflect loss of energy resources,they do not reflect energy use required forproduction or manufacturing of products. Theseresource losses are covered by a separate metric,E4, Flared gas.
Reporting basis
Report in gigajoules (one British Thermal Unit[BTU] = 1055 joules; 1 kilowatt-hour (kWh) =0.0036 gigajoules). Energy data should beconsolidated within the company’s reportingboundary using the ‘operational approach’(Appendix A).
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Definition of terms
• Total energy use: direct energy + indirect energy – exported energy• Direct energy: energy resource consumption by the facility or its equipment expressed as the primary
energy needed to produce the power or heat required. This includes the energy content of self-generated and purchased fuel consumed, as well as the energy from other renewable (e.g. wind,solar) and non-renewable sources, but excludes the energy content of flared or vented gas.
• Imported energy: amount of primary energy required to produce purchased power, most typicallyas electricity, heat or steam.
• Exported energy: amount of direct primary energy exported for use by others, most typically aselectricity, heat or steam.
• Energy intensity: total energy use divided by the appropriate normalization factor for the businesssegment (e.g. production volume, refinery throughput). See Section 3 for guidance on normalization.
References
1. API. 2009. Compendium of Greenhouse Gas Emission Estimation Methodologies for the Oil and Natural Gas Industry.www.api.org/ehs/climate/new/upload/2009_GHG_COMPENDIUM.pdf
2. IPIECA/API/OGP. 2011. Petroleum Industry Guidelines for Reporting Greenhouse Gas Emissions. Scheduled for publication in2011. www.ipieca.org
3. North American Manufacturing. 1986. North American Combustion Handbook, Volume I: Combustion, Fuels, Stoichiometry, HeatTransfer, Fluid Flow. ISBN 0-9601596-2-2 (Third Edition, Cleveland, Ohio, 1986).
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Total energy use. ● Exported energy (if power generation for exportrepresents a material contribution to energy profile).
● Energy intensity by business activity (e.g. oil andgas production, refining).
● Initiatives and progress towards improving energy efficiency and consuming less energy. Forexample, many companies are producing energy on site and using combined heat and power (CHP,also known as cogeneration) plants to improve energy efficiency.
● Progress in managing energy consumption through use of energy-use indices, comparing currentenergy use per unit product produced to a historical reference point.
● For refineries and chemical plants, indices that account for facility-specific infrastructure andoperation conditions can be used to provide comparability of energy efficiency performance.Solomon Associates’ Energy Intensity Index, for example, is used for facility-specific analysis ofrefinery energy performance. Companies may wish to report on trends in these or other indices totrack progress of energy-use management.
● Report on what a company does to promote efficient customer use of energy.
Reporting elements
Environmental indicators Climate change and energy E3: Alternative energy sources
Description
Report qualitatively on company research, plansor current initiatives related to alternative orrenewable energy sources.
Purpose
To meet growing global demand, a wide varietyof energy sources, including low-carbon energysources, will be needed. This indicator facilitatesreporting of company activities in developing,supplying and/or using non-fossil fuel energy,particularly alternative and renewable energyresources. It helps to communicate a company’sapproach to sustaining energy supplies throughuse and development of innovative technologiesto conserve non-renewable energy sources, orthrough development, marketing and use ofenergy that is less carbon intensive.
Scope
Reporting of a company’s strategy with regard toits production of alternative/renewable energy forsale and/or for internal use may includequantitative or qualitative information such as:● production of alternative/renewable energy,
either for internal use or sale; ● if producing alternative energy from multiple
sources, provide a breakdown by source; and● if producing biomass or biofuel energy, discuss
associated material issues such as emissions,indirect land-use changes, water use, socialissues and lifecycle assessment of carbonreductions.
Companies should discuss their efforts to developtechnologies that support renewable or alternativeenergy sources as well as expand energy supplies.
They should describe plans and projects thatdrive renewable energy development, productionand use.
Reporting basis
This indicator is largely qualitative and caninclude examples to illustrate application of theindicator at the local level. When reportingalternative/renewable energy production, thepreferred unit is gigajoules and data should beconsolidated within the company’s reportingboundary using the ‘operational approach’(Appendix A).
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Discuss approach to alternative/renewable energy, including descriptionsof relevant operations activities,investment plans or research anddevelopment projects and activities.
● Discuss management of environmental and socialissues surrounding any production of biofuelenergy.
● Amount of alternative/renewable energy producedfor sale.
● Amount of alternative/renewable energy producedfor internal company use.
● Companies are encouraged to discuss their outlook on the supply and demand for energy, itsimplications for sustainability and their related investments in reducing the carbon footprint of fossilfuels as well as developing renewable/alternative energy supplies.
● Report on significant use of alternative/renewable energy sourced from third parties, such asrenewable energy purchased from a utility supplier.
● Although nuclear energy is not typically considered to be an alternative fuel, companies withsignificant activities in nuclear energy production may describe their activities and separately reportnuclear energy produced or used.
Reporting elements
References
1. IPIECA. 2007. Climate Change: A Glossary of Terms (Fourth edition, April 2007)www.ipieca.org/publication/climate-change-glossary-terms-4th-edition
Definition of terms
• Alternative energy: energy derived from non-fossil fuel sources. Nuclear energy, while it is a non-fossil fuel, is typically not included as an alternative fuel.
• Renewable energy: energy sources that are constantly renewed by natural processes. Theseinclude non-carbon technologies such as solar energy, hydropower and wind, as well astechnologies based on biomass. Lifecycle analyses are required to assess the extent to which suchbiomass-based technologies may limit net carbon emissions.
• Biofuel: fuel produced from organic matter produced by plants. Examples of biofuels includealcohol (from fermented sugar), black liquor from the paper manufacturing process, wood, andpalm and soybean oil.
• Biomass: Total dry organic matter or stored energy content of living organisms. Biomass can beused for fuel directly by burning it (e.g. wood), indirectly by fermentation to an alcohol (e.g. sugar)or extraction of combustible oils (e.g. soybeans).
Environmental indicators Climate change and energy E4: Flared gas
Description
Report the quantity of hydrocarbon gas flared tothe atmosphere from operations.
Purpose
The Flared gas indicator is a measure of naturalgas resource consumption and an importantcontributor, in some locations, to GHG emissionsand to other gases that may impact the localenvironment.
Scope
Gas flare systems are an essential safetymechanism in many petroleum operations. Flarescan, for example, safely combust gas releasedfrom pressure relief valves and other safetysystems during plant upsets, gas released fromvarious process or storage equipment, and non-marketable or unusable gas. Sources andsituations that may feed gas into flare systems caninclude but are not limited to:● pressure relief valve systems used to prevent
overpressure of equipment;● emergency depressurizing systems used for
safe plant management;● operations during plant start-ups and shut-downs;● tank storage overhead vapours (e.g. filling and
breathing losses);● glycol dehydrators;● solution gas from separators or flash tanks at
crude oil batteries, terminals or otherproduction facilities;
● well testing, especially at newly-drilled wells infrontier areas;
● well completion and clean-up operations whereflaring is necessary for well-bore and reservoirclean-up;
● blow-down and pigging operations on gasgathering or other pipeline systems;
● blow-downs of vessels, piping, gascompressors, or other equipment duringmaintenance; and
● vessel and tank truck loading emissions (e.g.vapours displaced during loading of tankers ortrucks).
Companies should report as flared gas the totalmass of hydrocarbon gas sent to operational flaresystems at a facility. This should include routineflaring operations as well as any non-routineflaring events. Reported flared gas should includethe hydrocarbon mass of purge gas, pilot lightfuel and assist gas, if these are substantial relativeto the total mass flared. Data on insignificantquantities of flared gases are not generallycollected or reported.
Calculation of flared gas should be based on thecomposition of the gas stream involved andshould exclude the mass of non-hydrocarbons,such as CO2, water, H2 and N2. In the absence ofmeasured gas composition data, engineeringestimates should be applied.
For most petroleum industry operations, venting ofhydrocarbons represents a minor resource useand related emissions are effectively covered byindicator E1, GHG emissions, and by the volatileorganic compounds (VOC) metric under indicatorE7, Other air emissions. If gas venting issubstantial, companies may separately report themass of vented hydrocarbon gas.
Reporting basis
Report quantitatively using units of metric tonnesof hydrocarbons flared. Reporting in units of massis encouraged because this provides a moreconsistent and comparable measure of productloss. Flare volumes may be reported in standardcubic metres (Sm3) or standard cubic feet (Scf) if
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Environmental indicators Climate change and energy E4: Flared gas
reporting on a volume basis, which is commonlyused in industry operations and may be betterunderstood by some audiences. When reportingvolume, specify units used and the temperature/pressure bases for the standardization.
Flared gas data should be consolidated within thecompany’s reporting boundary using the‘operational approach’ (Appendix A).
Data should be consolidated for all operationalactivities which contribute materially to thecompany’s total flared gas.
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Quantity of hydrocarbon gas flared fromoperations.
● Separately report hydrocarbon gas flared for eachrelevant business activity (e.g. oil and gasproduction, refining).
● Contribution of flaring to the company’s total GHG emissions in CO2e.● Reporting flaring by type can convey the causes of flaring and indicate areas for operational
improvement. For example, flaring can be split between routine causes (e.g. normal operations, welltesting) and non-routine causes (e.g. plant start-ups and shut-downs, pressure safety valve releases,emergency depressurization).
● Describe flare reduction activities including sustainable reduction improvements versus short-termoperational fluctuations.
● Separately report vented gas if hydrocarbon venting represents a substantial portion of a company’sresource use.
Reporting elements
References
1. API. 2009. Compendium of Greenhouse Gas Emission Estimation Methodologies for the Oil and Natural Gas Industry.www.api.org/ehs/climate/new/upload/2009_GHG_COMPENDIUM.pdf
2. IPIECA/API/OGP. 2011. Petroleum Industry Guidelines for Reporting Greenhouse Gas Emissions. Scheduled for publication in2011. www.ipieca.org
3. US EPA. Compilation of Air Pollutant Emission Factors, Volume I: Stationary Point and Areas Sources, AP-42 (GPO 055-000-005-001). US EPA Office of Air Quality Planning and Standards (Fifth Edition, January 1995, with Supplements A, B and C, October1996, and Supplement D, 1998). www.epa.gov/ttnchie1/ap42
Definition of terms
• Flared gas: total mass (or volume) of hydrocarbon directed to operational flare systems, whereinthe hydrocarbons are consumed through combustion.
Environmental indicators Ecosystem services
Ecosystems generate benefits ranging from freshwater and timber to pollination and climateregulation. Ecosystem services are fundamental toenvironmental sustainability, societal well-beingand economic prosperity. Ecosystem services aredistinguished from natural resources, such asminerals and fossil fuels, by the timeframe. Thequantity and quality of ecosystem servicesdepend on the living component of existingecosystems; natural resources such as fossil fuelsderive from organic material that was alivemillions of years ago.
Companies depend on, and affect, ecosystemservices and the underlying biodiversity. Pressuressuch as climate change and population growth maycause sufficient degradation that some ecosystemsmay require conservation measures if their benefitsare to continue. Companies can incorporateecosystem services into their management systemsand identify strategies for dealing with risks andopportunities for both ecosystems and business.
In developing reporting related to ecosystems, theindicators focus on biodiversity and on theecosystem service of fresh water, as both can be
impacted by oil and gas industry operations. Theycan also be enhanced by good stewardship. Giventhe breadth of concern for ecosystems, the categoryof indicators will most likely continue to expand inthe future.
Biodiversity and some ecosystem services are noteasy to quantify and aggregate. The choice of acompany’s reporting elements will depend on theparticular challenges faced in any given area. Thismay suggest that qualitative information, such ascase studies, will be more appropriate in somecases, whereas in others, location-specificquantitative data may be provided so that aspectsrelated to local ecosystems can be taken into account.
With an ecosystem service such as fresh water, forexample, challenges are likely to vary across acompany’s operating areas. Fresh water is amenableto quantitative, and therefore aggregated,measurement. However the associated potentialimpacts may be highly localized—for instance,related to operations in areas of fresh waterscarcity—so case studies can be beneficial whenreporting on this indicator. (See the example onWorking in remote locations in Section 2.)
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Environmental indicators Ecosystem services E5: Biodiversity and ecosystem services
Description
Qualitatively describe how the companyaddresses management of risks and opportunitiesrelated to biodiversity and/or ecosystem services.
Purpose
Oil industry activities can impact biodiversity andecosystem services. They can also depend onecosystem services such as fresh water. Thisindicator encourages companies to describe theirapproach to assessing and managing suchimpacts and dependencies. The associated risksand opportunities vary geographically and withthe type of activity/operation being conducted.Consequently, the materiality of issues andaspects associated with reporting of this indicatorvaries significantly between companies.
Scope
Using narrative based on policy statements,commitments, practices and case studies,companies should describe their goals, effortsand outcomes with regard to conservation ofbiodiversity and/or ecosystem services.
Because reporting of this indicator varies widelyacross the industry depending on activities andtheir locations, the majority of reporting elementsare supplemental, and provide coverage on: ● How biodiversity and/or ecosystem service
considerations are incorporated intoenvironmental management systems (EMS) orhealth, safety and environment integratedmanagement systems (HSE IMS). Examples atbusiness unit or asset level may be useful toillustrate how the company addressesassessment and management of biodiversityand ecosystem services risks and opportunitiesrelated to the terrestrial, fresh water and marineenvironment and local communities.
● The percentage of operations where actionplans—stand-alone or integrated into otheraction plans—have been implemented in areasdetermined by the company to have biodiversityor ecosystem service risks. The basis or criteriafor the associated sensitivity determinationshould be included, and should considerprimary, secondary and/or cumulative impacts.Companies can describe the results of the plans,including successful outcomes and howcontinuing challenges are being addressed.
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Environmental indicators Ecosystem services E5: Biodiversity and ecosystem services
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● Report on local engagement by explaininghow community and stakeholder concerns areassessed, evaluated as a measure ofenvironmental sensitivity, documented andaddressed in biodiversity conservation/actionplanning.
● Provide examples or case studies of operatingareas where adaptive management ofimpacts on biodiversity and/or ecosystemservices is in place. Such examples maydemonstrate the application of company-wideadaptive management processes or policies atthe site level.
● Companies may demonstrate or presenteffectiveness verification processes and/oractions based on assessment of ongoing results.
Reporting basis
Qualitative information including examples toillustrate application of the indicator at the locallevel. This may be supported by some quantitativedata, which should be consolidated within thecompany’s reporting boundary using the‘operational approach’ (Appendix A).
Definition of terms
• Adaptive management: the process of measuring, monitoring and reporting the results of currentmanagement practices and using those results to modify management and operational practices toimprove future biodiversity performance.
• Biodiversity: the variability among living organisms within species, between species and betweenecosystems.
• Ecosystem services: the Millennium Ecosystem Assessment [Millennium Ecosystem Assessment,2005 Ecosystems and Human Well-being. World Resources Institute, Island Press, Washington DC.]defines ecosystem services as the benefits (direct and indirect) that people obtain from ecosystems.The Assessment defines four categories of ecosystem services: provisioning services (productsobtained from ecosystems such as fresh water or timber); regulating services (ecosystems’ control ofnatural processes such as climate, disease, water flows and pollination); cultural services(recreation, aesthetic enjoyment); and supporting services (natural processes such as nutrientcycling that maintain other services).
• Ecosystems: complexes of plant, animal, and micro-organism communities and their non-livingenvironment, interacting as a functional unit. They include, but are not limited to, wetlands,rainforests, grasslands and farmlands.
• Operating area: an area where business activities take place with potential to interact with theadjacent environment. Geographically, the term ’operating area‘ may encompass an area of anysize with a unifying environmental and/or operating feature (e.g. platform, field, watershed,habitat).
Environmental indicators Ecosystem services E5: Biodiversity and ecosystem services
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References
1. Energy and Biodiversity Initiative (EBI) guidelines and products (2003). www.theebi.org
2. IPIECA. 2007. An Ecosystem Approach to Oil and Gas Industry Biodiversity Conservation.www.ipieca.org/publication/ecosystem-approach-oil-and-gas-industry-biodiversity-conservation
3. IPIECA/OGP. 2005. A Guide to Developing Biodiversity Action Plans for the Oil and Gas Sector.www.ipieca.org/publication/guide-developing-biodiversity-action-plans-oil-and-gas-sector
4. ISO. Environmental Management Systems (ISO 14001 2004), especially section 4.3.1. www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=31807
5. WBCSD, Meridian Institute, World Resources Institute. 2008. Corporate Ecosystem Services Review: Guidelines for IdentifyingBusiness Risks and Opportunities Arising from Ecosystem Change Version 1.0 (March 2008).www.wbcsd.org/Plugins/DocSearch/details.asp?DocTypeId=25&ObjectId=Mjg5NjQ
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe the company’s goalsand efforts in addressingconservation of biodiversityand/or ecosystem services.
● Describe how management of risks and opportunities relatedto biodiversity and/or ecosystem services is integrated intothe company’s management systems (EMS or HSE IMS).
● The percentage of biodiversity-sensitive operating areas (asdetermined by the company) where biodiversity action planshave been implemented. Include the criteria used todetermine sensitivity.
● Explanation of how community and stakeholder concerns areassessed, evaluated and addressed.
● Examples or case studies of operating areas where adaptivemanagement of impacts on biodiversity and/or ecosystems isin place.
● Effectiveness verification processes and/or actions based onassessment of ongoing results (by description or example).
● Companies applying an ecosystem services approach may include a description of the company’sapproach to and implementation of broader issues related to resources and processes that aresupplied by natural ecosystems.
Reporting elements
Environmental indicators Ecosystem services E6: Fresh water
Description
Report quantity of fresh water withdrawn orconsumed by oil and gas operations.
Purpose
Fresh water management is important whereverfresh water resources are constrained due tolimited supplies or extensive use. Watermanagement can influence water availability forthe local environment, socio-economicdevelopment and future demands.
Scope
The common reporting element recommendsreporting the total volume of fresh waterwithdrawn by a company either directly fromfresh water sources (e.g. lakes, ponds,groundwater aquifers, streams and rivers) ortaken from municipal fresh water supplies or otherwater utilities. Some business operations mayreturn significant amounts of fresh water, treatedas necessary to the appropriate fresh waterstandards, back to the same, or to a different,fresh water source. The common element alsoprovides the option of reporting fresh water
consumed (Figure 6), which is the amount of freshwater withdrawn less fresh water returned. Thecommon reporting element recognizes thatcompanies may initially collect and report freshwater withdrawn data and encourages companiesto extend the data collection to enable calculationof fresh water consumption. Companies areencouraged to report both fresh water withdrawnand consumed, subject to the availability of therequired data, as this gives a more completepicture of sustainability performance trends.
The following types of water should be excludedfrom the reported quantities:● fresh water, used for once-through cooling
water, returned unchanged (excluding thermaleffects) to a fresh water source. (The largevolumes often used in cooling would otherwisedistort fresh water withdrawal data and suchuse does not represent consumption as thewater is returned. Fresh water used for once-through cooling water is addressed in otherreporting elements.);
● water provided from another facility within thecompany, which has already been counted bythat facility;
● storm water; and
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Figure 6 Calculation of fresh water consumption
Fresh water withdrawn (Q1) *• Purchased potable water• Purchased raw water• Groundwater• Surface water• Purchased steam• Purchased other• Harvested rainwater• Recycle from external source
Fresh water returned (Q2)Fresh wastewater returned to afresh water source directly bythe company or indirectly viaa third-party treatment facility
Operational useincluding
internal recycle
Fresh water consumed = Q1 – Q2
* Note exclusions in the main text, above
Environmental indicators Ecosystem services E6: Fresh water
● fresh groundwater extracted solely forremediation or to control the migration ofcontaminated groundwater.
For upstream operations, produced water is alsogenerally excluded except where the water meetsregulatory standards for fresh water.
As potential impacts are likely to be localized andmore significant in areas where water is scarce, asupplemental reporting element encouragescompanies to provide additional information onoperations in such locations. Case studies, orother forms of local reporting, can be used to
illustrate the company’s approach to impactassessment and conservation of fresh waterresources (see the example on Working in remotelocations in Section 2).
Reporting basis
Volume of fresh water in cubic metres (m3). Freshwater data should be consolidated within thecompany’s reporting boundary using the‘operational approach’ (Appendix A) and includeexamples to illustrate application of the indicatorat the local level.
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Definition of terms
• Fresh water: the definition varies in accordance with local statutes and regulations. Where it is notdefined by local regulations, fresh water is defined for reporting purposes as non-brackish waterand may include drinking water, potable water, water used in agriculture, etc. The total dissolvedsolids (TDS) concentration of this water type is up to 2000 mg/l.
• Fresh water withdrawn: the volume of fresh water removed from sources (including surface water,groundwater, harvested rainwater and municipal water supplies) and taken into the boundaries ofthe reporting company for use.
• Fresh water returned: the amount of fresh water discharged from a facility (directly or via a thirdparty) into a fresh water supply, body or aquifer. Care must be taken to correct the discharge valueby subtracting the amount of water which was not originally part of the fresh water withdrawn.Examples include collected storm water, or any groundwater from remediation activities (unlessused in the facility as a source of fresh water). Fresh water that is discharged to a non-fresh watersupply, body or aquifer should not be considered fresh water returned.
• Fresh water consumption: the difference between fresh water withdrawn and fresh water returned. • Water reuse/recycle: the volume of water used in more than one process, or reused more than one
time in a single process, that reduces the total amount of fresh water withdrawal required at thesite. This volume is the difference between the total quantity of fresh water required in all processes(excluding once-through cooling) and the quantity of fresh water withdrawn.
Environmental indicators Ecosystem services E6: Fresh water
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Report total fresh waterwithdrawn or consumed.
● Identify operations in water-scarce areas and discuss watermanagement practices.
● Information in water-scarce areas including volumes of water withdrawn and/or consumed fromsources such as:• municipal water supplies or other water utilities;• surface water, including water from lakes, ponds, streams and rivers; and• groundwater.
● Examples where companies have avoided or minimized their fresh water withdrawal and/orconsumption in water-scarce areas (e.g. by applying lower water-use technologies, using alternatelower-quality sources, or recycle, re-use, reclaim and/or treatment processes).
● Fresh water use for once-through cooling water.● Information on company use of reused/recycled water.● Information on company use of fresh groundwater extracted for remediation or to control the
migration of contaminated groundwater.
Reporting elements
References
1. FAO (Food and Agriculture Organization of the United Nations). www.fao.org/nr/water/index.html
2. US Geological Survey. water.usgs.gov
3. WHO (World Health Organization). www.who.int/topics/water/en
4. WRI/WBCSD. Global Water Tool.www.wbcsd.org/templates/TemplateWBCSD5/layout.asp?type=p&MenuId=MTc1Mg&doOpen=1&ClickMenu=LeftMenu
Environmental indicators Local environmental impact
The operations of the industry—exploration,production, refining, marketing and transport ofoil and gas—can result in impacts on the localenvironment. As a result, companies applysystematic tools to: ● assess environmental impacts; ● mitigate risks of pollution or contamination
through control technologies; ● continuously reduce the impact of emissions,
discharges and waste streams; and ● respond effectively to incidents, such as marine
spills.
This has also resulted in improved and moreconsistent indicators, which have benefited fromindustry benchmarking. The application of arobust environmental management system (EMS)and performance indicators enables the industryto demonstrate continuous improvement inreducing its impacts on the environment.
Issues relating to the local environment can bematerial for corporate reporting. The fourindicators in this section focus on impacts to air,water and land, while recognizing that otherindicators previously covered, such as flared gas,biodiversity and fresh water, can also be significantin terms of impact to the local environment.
Because these environmental impacts arelocalized, the challenges will not be the sameacross a company’s operating areas. Regulation ofthe local environment is fairly mature in some localand national jurisdictions, but is less so in others.Therefore, companies should select reportingelements through which they can describe theirresponses to the challenges they face in differentareas. Qualitative information can be useful here,such as case studies, other forms of localreporting, or quantitative data that reflects aspectsor sensitivities related to specific locations.
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Environmental indicators Local environmental impact E7: Other air emissions
Description
Report quantities of emissions to the atmospherefrom oil and gas operations.
Purpose
Air emissions from oil and natural gas operationsmay contribute to local or regional impacts—suchas regional haze or acid rain—that can affecthuman health or damage flora and fauna.Reduction in air emissions by industry cancontribute to improvements in air quality.
Scope
Significant emissions released to the atmospherefrom oil and natural gas operations should bereported by emissions type. The specific substancesincluded in each emission type are detailed in thedefinition of terms or as specified by the localregulatory agency. Substances include:● volatile organic compounds (VOCs);● oxides of sulphur (SOx);● oxides of nitrogen (NOx), excluding N2O;● particulate matter (PM);● ozone-depleting substances (ODS); and● other regulated air emissions.
This scope does not include CO2 and methane,which are reported within indicator E1, GHGemissions.
Approved or required methods of estimation andcalculation of air emissions vary by localregulatory standards and by facility permitrequirements. The performance data for thisindicator should reflect the approved localmethodologies under which the company’sfacilities are operating.
Reporting basis
Report quantitative emission data in metric tonnes(SOx reported as SO2 and NOx reported asNO2). Air emissions data should be consolidatedwithin the company’s reporting boundary usingthe ‘operational approach’ (Appendix A) andinclude examples to illustrate application of theindicator at the local level.
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Indicator:E7: Other air emissions
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Environmental indicators Local environmental impact E7: Other air emissions
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Definition of terms
Due to air pollution regulations at national, regional and local levels, the specific compoundsregulated in each emission type may vary slightly between jurisdictions. Therefore, the followingdefinitions are provided as a guide for reporting:• Oxides of nitrogen (NOx): includes nitric oxide (NO) and nitrogen dioxide (NO2). • Oxides of sulphur (SOx): includes sulphur dioxide (SO2) and sulphur trioxide (SO3).• Volatile organic compounds (VOCs): organic compounds, excluding methane, which vaporize in
the atmosphere and may participate in photochemical reactions. VOCs should be defined inaccordance with regulatory requirements where a local regulatory agency has defined measuresfor specific compounds. The company should specify which species are included in the reporting(e.g. non-methane VOC, non-methane-ethane VOC) and qualify if there are locations where alocal regulatory agency has defined specific compounds.
• Particulate matter (PM): a complex mixture of extremely small particles and liquid droplets. PM ismade up of a number of components, including acids (such as nitrates and sulphates), organicchemicals, metals, and soil or dust particles. Definitions depend on local regulations and arefrequently based on particle size (e.g. PM10 or PM2.5). Companies should specify which PM metricthey are reporting.
• Ozone-depleting substances: includes halons, CFCs, HCFCs and methyl bromide (reportingsuggested where quantities emitted may be of interest).
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Report total emissions, by type:• volatile organic compounds (VOCs);• oxides of sulphur (SOx); and/or• oxides of nitrogen (NOx).
● Total emissions, by type, if significant:• particulate matter (PM);• ozone-depleting substances (ODS); and/or• other air emissions with a company-wide impact.
● Regional and/or business activity breakdown,where relevant.
● Companies are encouraged to report case studies, or other forms of local reporting or data thataddress significant impacts at regional, national and/or local levels.
● Identify operations in areas of poor air quality and discuss air management practices.
Reporting elements
References
1. CONCAWE. 2009. Air Pollutant Emission Estimating Methods for E-PRTR Reporting by Refineries. Report 1/09.www.concawe.be/content/default.asp?PageID=569
2. US EPA AP-42 standards, www.epa.gov/ttn/chief/ap42/index.html; or the EMEP/EEA Emission Inventory Guidebook.www.eea.europa.eu/publications/emep-eea-emission-inventory-guidebook-2009
Environmental indicators Local environmental impact E8: Spills to the environment
Description
Quantify spills to the environment fromoperations, and describe major spills andresponse measures.
Purpose
The oil industry transports oil and gas usingpipelines and marine or road tankers. Theseoperations, together with other upstream anddownstream activities, pose a risk of accidentalspills of oil or other materials that have the potentialto pollute water, contaminate soil, harm speciesand affect livelihoods. This indicator measures thenumber and volume of spills (unintended releases)of materials that could impact the environment.
Scope
The most established industry measure is to reportthe number and volume of hydrocarbon spillsgreater than one barrel (bbl) that reach theenvironment. (For reference, 1 bbl = 42 USgallons or 159 litres; for solids, convert mass tovolume in barrels, for example, using 159 kg orsimilar default value for weight of material.) Thevolume reported should represent the totalestimated amount spilled that reached theenvironment. It should not be reduced by theamount of such hydrocarbon subsequentlyrecovered, evaporated or otherwise lost.
In addition to reporting spills that reach theenvironment, companies may choose to reportseparately the number and volume of spills,whether or not the spill reached the environment.Thus, total spills would include releases—hydrocarbon and/or chemicals—from primarycontainment (i.e. spills that reach the environment,plus spills that are contained within impermeablesecondary containment). This indicator provides
further reporting on operational performance andreliability.
Companies should include releases fromoperations and events including:● above-ground and below-ground facilities;● sabotage, earthquakes or other events outside
operational control; and● company-owned and operated transport.
Leakage over time, above ground or underground,is counted once at the time it is identified.
Companies may report spills to soil and waterseparately. A spill that qualifies as a spill to bothsoil and water should be reported as a single spillto water, with the volume properly apportioned tosoil and water.
The following should be excluded from thereported data:● once previously reported, spilled materials in
the environment from historical losses (i.e.historical or past leakage/spills that reachedthe environment from tanks, pipes or othervessels, but not associated with a currentrelease); and
● hydrocarbons in produced water discharges orotherwise permitted discharges (i.e.wastewater effluents etc.), which are includedin indicator E9, Discharges to water.
In the absence of analytical data, reportingcompanies may choose to estimate thehydrocarbon content of spills of oil/watermixtures (e.g. oil–water emulsions, tank bottoms),stating the scope or basis of the estimate. Ifreporting spills with both hydrocarbon and non-hydrocarbon components, companies may wishto report a single hydrocarbon spill with thevolumes properly apportioned.
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Indicator:E8: Spills to the environment
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Environmental indicators Local environmental impact E8: Spills to the environment
If relevant, companies may choose to reportseparately spills of other materials, includingchemicals. For chemical spills involving: ● miscible solutions, the spill volume is based on
the total volume of material spilled; and● insoluble mixtures, the spill volume is based on
the volume of the chemical constituent.
Reporting basis
Number of spills greater than one barrel (or0.159 cubic metres) and the volume of these spillsin barrels (bbl) or cubic metres of material spilled.
Oil spill data should be consolidated within thecompany’s reporting boundary using the‘operational approach’ (Appendix A) and includeexamples to illustrate application of the indicatorat the local level.
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Definition of terms
• Spill to the environment: any unintended release of liquids or solids associated with current operations, from primaryor secondary containment, into the environment.
• Environment: surface water, soil and groundwater in soil whereby:- ’soil‘ is surfaces (e.g. soil, sand, silts, shells, gravel) not designated as impermeable secondary containment;- ‘surface water’ includes creeks, rivers, ponds, seas, oceans, etc. but excludes ponds, pits, basins, etc. in place on
company property for purposes of hydrocarbon containment/treatment;- spills to ice-covered surfaces are classified based on the surface below the ice; and- spills to standing rainwater are classified as a spill to soil.
• Hydrocarbon liquids: crude oil, condensate and petroleum-related products containing hydrocarbons that are used ormanufactured, such as: gasoline, residuals, distillates, asphalt, jet fuel, lubricants, naphthas, light ends, bilge oil,kerosene, aromatics, refinery petroleum-derivatives. Includes: - biofuels, regardless of percentage mixture with petroleum-based materials (if 100% methanol or ethanol it would be
a chemical spill); and- the oil fraction of oil/water mixtures (e.g. emulsions, non-aqueous drilling fluids (NADFs)).
• Non-hydrocarbon materials: materials such as chemicals, aqueous-based drilling fluids, produced water and otherprocess-related non-hydrocarbons. Examples of chemicals include methanol, ethanol, ketones, methyl tertiary butyl ether(MTBE), sulphuric acid, caustic, molten sulphur, stimulation acid, brine, dry salts, uncured or powdered cement.Excluded are spills of inert solid materials such as plastic pellets, solid sulphur, barium sulphate, bentonite or cured solidconcrete as well as treated or untreated wastewater.
• Containment: primary containment is the vessel, pipe, barrel etc. designed to keep a material within it; secondarycontainment is an impermeable, non-leaking physical barrier specifically designed and maintained to keep spilledmaterials from contacting the soil or water (e.g. HDPE liners, engineered clay liners, asphalt, concrete). Earthen bermsdo not count as secondary containment unless they are engineered to be sufficiently impermeable to prevent spilled oilfrom contaminating underlying soil and/or groundwater.
• Recovered hydrocarbons: the spilled hydrocarbons removed from the environment through short-term spill responseactivities. This does not include longer-term remediation of the spill site. Oil which evaporates or burns should not be includedin recovered volumes. This volume provides an indication of the effectiveness of immediate oil spill response measures.
Environmental indicators Local environmental impact E8: Spills to the environment
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Report the number and total volume spilled ofhydrocarbon spills > 1 bbl reaching theenvironment.
● For spills of significance, determined by thecompany, describe impacts and response actions.
● Describe emergency preparedness and responseprogrammes, plans, organizational structuresand affiliations for an effective response to spillsand other emergencies.
● Volume of hydrocarbon recovered.● Total number and volume spilled (bbls) of
hydrocarbon spills > 1 bbl from primarycontainment.
● Separately report hydrocarbon spills to soiland to water (number and volume spilled).
● Separately report hydrocarbon spills bybusiness activity (e.g. exploration andproduction, refining, chemicals).
● Report spills of chemicals or other materials (non-hydrocarbon) that could have an impact on theenvironment.
● Separately report land and water spill data for spills that reach the environment.● Report spills with lower thresholds (<1 bbl) where smaller spills are significant to certain activities or
locations. For example, marketing and transportation may have more small spills than otheroperations.
● For significant spills, companies may report both the causes of the spills and the lessons learned frominvestigations.
● Discuss significant impacts on the environment, as a result of spills, in qualitative terms, particularlyfrom larger releases or from a small release into a sensitive environment.
● Describe policies, programmes and initiatives undertaken to prevent accidental releases ofhydrocarbons/other materials to the environment.
● Separately report significant hydrocarbon spills from product transportation by third parties.
Reporting elements
Environmental indicators Local environmental impact E9: Discharges to water
Description
Quantify hydrocarbon discharges to a waterenvironment from oil and gas operations.
Purpose
Discharges to water are controlled industry-wideto reduce environmental impacts. The oil and gasindustry handles large quantities of producedwater, process wastewater and storm waterwhich, in compliance with regulatoryrequirements, are normally treated to removecontaminants before being discharged. Actualenvironmental risk or impact is subject to localenvironmental conditions: larger discharges insome environments may have lower risk thansmaller discharges in other environments.
Scope
For exploration and production operations, thisindicator refers to the quantity of hydrocarbonsdischarged in produced water, processwastewater and storm water. For refining andother oil and gas processing facilities, it refers tothe quantity of hydrocarbons in dischargedprocess wastewater and storm water. Inlanddischarges to drainage structures that connectwaterways are included and quantities of othersubstances, in process wastewater and stormwater, discharged to water may be reported.
This indicator excludes:● spills, including hydrocarbons, chemicals
and/or oil-based drilling fluids and cuttings(included under E8, Spills to the environment);
● spills of drilling and production chemicals(included under E8, Spills to the environment);
● quantities of hydrocarbon discharged to third-party treatment facilities; and
● quantities of hydrocarbon associated with aonce-through cooling water withdrawalreturned unchanged, excluding thermal effects.
Reporting basis
Report discharge data in metric tonnes ofhydrocarbons (oil and grease) or othersubstances reported. Quantities may also beexpressed in terms of average concentrations(in mg/l or ppm).
Water discharge data should be consolidatedusing the reporting boundary ‘operationalapproach’ (Appendix A) and include examplesto illustrate application of the indicator at thelocal level.
Measurements should be made using test methodsrequired or approved by local regulatoryauthorities (or equivalent applicable standards).
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Definition of terms
• Produced water: water that is brought to the surface during the production of hydrocarbons.• Process wastewater: water associated with operations that comes into contact with hydrocarbons
and other chemicals. • Storm water: rainwater falling on a site that is collected and discharged to the water environment
from point source outlets (e.g. pipes, collection ditches). • Discharges to the environment: includes both inland waterways and the sea.
Environmental indicators Local environmental impact E9: Discharges to water
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● For upstream facilities, report quantity ofhydrocarbons (in metric tonnes) in producedwater, process wastewater and storm waterdischarged to surface water.
● For refineries and other oil and gasprocessing facilities, report quantity ofhydrocarbons (in metric tonnes) dischargedto surface water from treated processwastewater and storm water.
● Report separately the quantity of substancesother than hydrocarbons (in metric tonnes)discharged to surface water from oil and gasprocessing facilities. Other measures mayinclude chemical oxygen demand (COD),sulphides, ammonia, phenols, and totalsuspended solids (TSS), as well as non-aqueousdrilling fluids discharged (i.e. in associationwith drilling mud and drill cuttings).
● Report separately the quantities of substances in storm water or other non-process wastewaterdischarges.
● Indicate volumes of produced water, process wastewater and storm water discharged, and detail thetreatment method, place of discharge and volumes reused by others.
● Explain trends in discharged volumes with respect to operating conditions affected by field age, etc.● Discuss efforts to reduce discharges into environments where they have greater potential for causing
environmental impacts.● Discuss discharges to unlined evaporation ponds that may affect groundwater, if material.
Reporting elements
Environmental indicators Local environmental impact E10: Waste
Description
Report quantities of waste disposed of, resultingfrom oil and gas operations.
Purpose
Effective waste management practices areimportant throughout operations to reduce theenvironmental, social or economic impacts.Waste is not defined consistently worldwide andits management often varies with localconditions. This indicator recognizes that animportant way of reducing waste impacts is tominimize the generation of waste, and thateffective waste management is an aspect ofoperational efficiency.
Scope
Report the quantity of operational hazardouswaste disposed of, including both on-site and off-site disposal. Companies may wish to reportseparately the quantities of operational non-hazardous waste disposed of, and of wastereused, recycled or recovered. The companyshould clearly state the basis for its reported data.Sources that should be included are:● wastes from operational activities;● wastes from spill response/clean-up; and ● wastes from replacement or upgrade of
existing facilities (e.g. during the rebuilding ofa retail service station).
Excluded from the scope are:● wastes from the remediation of historical
contamination at active sites;● wastes from the remediation of inactive or
abandoned properties; ● wastes from the construction of new facilities
upon greenfield sites; ● wastes generated by contractors during
maintenance of their own equipment, or anymaterials brought onto site and eventuallydisposed of as surplus by the contractor;
● drilling mud and cuttings; ● mine tailings; and● produced water and waste water.
If a regulatory authority defines any of these out-of-scope materials as hazardous—or someequivalent term—and they are disposed of asdefined above, they should be reportedaccordingly as operational hazardous waste.
Different types of business or operational activitycan have different regulated hazardous wastestreams, with different treatment and managementoptions available depending upon the regions inthe world in which the reporting companyoperates.
In downstream operations, major shutdowns andperiodic maintenance activities can result in short-term increases in waste generated. For upstreamoperations, high-volume, short-term aqueouswastes (such as those associated with drilling) canresult in large variations in waste generated.Reporting these waste streams separately mayenable companies to better understand andexplain year-to-year fluctuations. The scope ofwaste streams included should be clearly stated.
In areas of the world where no wasteinfrastructure exists, waste may need to be safelystored on site for a significant period of timebefore final disposal or a recovery option cantake place. Companies should report separatelythe quantity of waste in such storage if theamount is material to the overall company total.Similarly, they should explain the inclusion oflarge one-off disposals of stored waste in theirreported numbers.
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Reporting basis
Report mass of waste in metric tonnes. Wastedata should be consolidated within thecompany’s reporting boundary using the‘operational approach’ (Appendix A) andinclude examples to illustrate application of theindicator at the local level.
It may not be practical to account for all wastefrom operations. If a company has adopted aninternal de minimis reporting threshold, by whicha facility does not track waste information, it isgood practice to disclose the de minimis thresholdand indicate the significance to the company’sdata—indicating if, for example, routine wastefrom marketing operations is below anestablished de minimis level.
Quantities of wastes (both hazardous and non-hazardous) should be measured using methodsrequired or recommended by regulatory agenciesor authorities. The method of measurement andestimation selected should be stated.Recommended methods include: ● direct measurement on site;● direct measurement by transporters at the point
of shipping or loading (consistent withshipping papers);
● direct measurement by waste disposalcontractor at the point of waste disposal; and
● engineering estimates or process knowledge.
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Definition of terms
• Waste: material (solid or liquid) intended to be disposed of, reused, recycled or recovered either onsite or off site that is the result of company operations. Includes domestic trash and other discardedmaterial from offices and commercial (e.g. retail) activity. It does not include regulated or authorizedwater discharges such as effluent from water treatment plants or produced water from oil and gasproduction.
• Operational hazardous waste: waste that is defined as hazardous, toxic, dangerous, listed, priority,special—or similar term—per applicable country, regulatory agency or authority.
• Operational non-hazardous waste: industrial wastes resulting from company operations, includingprocess and oil field wastes (solid and liquid) disposed of either on site or off site. Includes trash andother office, commercial (e.g. retail) or packaging-related wastes. Excludes hazardous waste asdefined above.
• Disposal: any waste management option, either on-site or off-site, classified as ’disposal‘ by anappropriate regulatory agency or authority, or in cases where such classification is absent, any wastemanagement that does not meet the definition of ‘reused, recycled and recovered’ wastes (e.g. landfilling or burning without energy recovery). Temporary storage is not considered disposal.
• Reused, recycled or recovered wastes: wastes from an industrial or commercial (e.g. retail) processthat are not disposed of, but are reused (e.g. used as a raw material for another process) orrecovered for beneficial use. Examples may include: catalysts sent for reclamation; sludge used forfuel; reused construction materials; recovered used oil and solvents; recycled scrap metal; drums andpallets returned or reused; plastic, glass, or paper reused or reprocessed and uncontaminatedearthen materials used as fill.
Environmental indicators Local environmental impact E10: Waste
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● The total quantity, in metric tonnes, ofoperational hazardous waste disposed of.
● The total quantity of operational non-hazardouswaste disposed of.
● Waste recycled, reused or recovered.
● Report separately quantities of waste by waste streams and by business or operational activities.● Report separately significant quantities of waste stored on operational sites. ● In addition to reporting operational waste disposed of, companies may wish to also report waste
generated, prior to recycle, reuse or recovery measures.● Report separately wastes excluded from routine reporting: from remediation activities from either
active and/or inactive sites, waste associated with unusual activities such as large one-timeconstruction projects, or large-volume wastes such as drill mud and cuttings, or mine tailings.
● Report on efforts to minimize the generation of hazardous wastes and on processes used to verifythat company hazardous waste management practices adhere to regulations and are conducted in asafe manner.
Reporting elements
References
1. European Parliament. Directive 2008/98/EC on Waste. (19 November 2008). eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2008:312:0003:0003:EN:PDF
2. OGP. 2008. Guidelines for waste management with special focus on areas with limited infrastructure. OGP Report No. 413.(Rev. 1.1 September 2008; updated March 2009). www.ogp.org.uk/pubs/413.pdf
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Section 5:
Health and safetyindicators
Health and safety indicators
The presence of flammable hydrocarbons is anintrinsic hazard in the oil and gas industry, inoperational locations and wherever products aretransported or used. The related health and safetyrisks have to be addressed across the industry’sactivities, which include seismic and drillingprojects, facility operations, maintenance,construction, and marine and road transport.
Management systems (see Section 2) have beensuccessful in mitigating health and safety risksand reducing the number of incidents. Animportant aspect of these systems is continuousimprovement that is assessed by monitoringperformance using indicators.
The most common types of heath and safetyincidents occur in the workplace; therefore, threeof the five indicators focus on protection of the
workforce, including measurement of incidentsthat can provide lessons for the future. Lessfrequent, but potentially more severe, are failuresof plant integrity or product-related hazards tothird parties. Process safety is a new indicatorreflecting the potential for major incidents or nearmisses that have the potential for seriousconsequences. Incidents can have multipleconnections to environmental, social andeconomic issues and indicators, which arecovered in Sections 4 and 6 of the Guidance.
The five indicators strike a balance betweenproviding quantitative ‘lagging’ data, on theoutcomes and consequences of health and safetyrisks, and qualitative ‘leading’ information thatfocus on the systems in place to continuouslyimprove performance and reduce risk.
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Summary of health and safety indicators
Issue category Indicator Page number
Workforce protection HS1: Workforce participation 68 HS2: Workforce health 70 HS3: Occupational injury and illness incidents 72
Product health, safety and HS4: Product stewardship 76environmental risks
Process safety and asset integrity HS5: Process safety 79
Health and safety indicators Workforce protection
Although the industry has long experience indealing with health and safety risks, and seriousincidents have been reduced, accidents orinadvertent exposures still occur. These may resultin fatalities, severe injuries or illnesses. The primaryimpact is on employee or contractor members ofthe workforce engaged in routine or non-routinetasks (although third parties can be affected, forexample, through road-traffic accidents).
Providing adequate protection to all members ofthe workforce continues to be an importantpriority for the management of oil and gascompanies. Even though significant progress hasbeen made, workforce protection will remain amaterial issue for reporting in the long term. Acompany’s record on this issue is often used as a‘barometer’ of how well a company is managingits operations.
The most established indicator across the industryis the record of injuries and illnesses that areinvestigated to provide systematic learning on howto prevent incidents from recurring. The indicatorson workforce participation and workforce healthreflect longer-term inputs to ensure that people areaware of risks and take steps with management toimprove controls to prevent injury and illness.
In this section, three indicators recognize the needfor inclusion of employees as well as contractorsand others that form the workforce of a company.When discussing the workforce, particularly inquantitative terms, companies should clarify theextent to which employees, contractors and othersare included in the information or data reportedfor each indicator. The guidance in Appendix A,on developing a reporting boundary, can help toclarify reporting.
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Health and safety indicators Workforce protection HS1: Workforce participation
Description
Describe joint management, and workforce healthand safety programmes and processes, tofacilitate participation of the workforce at alllevels in health and safety dialogues.
Purpose
Workforce participation programmes canenhance cooperative attitudes and culture in theworkforce, which in turn contributes towardsidentifying and addressing potential health andsafety problems and ensuring managementsystem effectiveness.
Scope
Describe the structure of joint management andworkforce health and safety programmes andprocesses to facilitate active workforceinvolvement in health, working environment andsafety improvements, and in consultations. Includein the discussion how these programmes orprocesses are integrated into the overall healthand safety management system, and howparticipation of the workforce at all levels isencouraged.
Contractors within the workforce often have theirown joint worker and management programmesthat are the responsibility of their directcompany’s management. Consideration should begiven to describing the interactions betweencompany participation programmes and those ofthe contractors and business partners operatingon company sites.
Companies are encouraged to report on thoseprogrammes and processes that supportinvolvement of the workforce in continuousimprovement of health and safety performance.
Description of the workforce participationprogrammes and processes typically include someof the following:● policy and programme development,
deployment and improvement; ● health and safety orientations and training;● management and leadership interfaces
outlining how senior managementencourages the workforce to identifyconcerns and participate in health and safetyinitiatives;
● review of health and safety performance at theasset level; this may include discussions onprogress towards continuous improvementobjectives as part of the asset’s managementsystem approach;
● facilitation of management system effectivenessby consulting with the workforce on health andsafety matters, including feedback mechanisms(e.g. workforce health and safety steeringcommittees, management of changeconsultation, promotion of a goodpsychosocial working environment, health andsafety surveys);
● risk assessments participation andrepresentation, including Hazard andOperability (HAZOP) and project hazardsanalyses; and
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● regular joint participation of workers andmanagers in company health and safetyprogramme (e.g. behaviour-based safetyprogrammes, site and activity observations,job safety analysis meetings, andresponsibilities for all to identify and respondto workplace risks); this should include steps toensure workforce inclusion (i.e. preventingsegmentation, discrimination or exclusions).
Reporting basis
The leading indicator is qualitative and reportableat a global level, and may be supported byquantitative data on the extent of programmes,where available, and local case studies. Theworkforce includes both company employees andcontractors. Quantitative workforce data shouldbe consolidated within the company’s reportingboundary using the workforce approach(Appendix A).
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe the company’s approach tomanaging workforce participation in healthand safety dialogues.
● Report specific activities at the facility level thatillustrate the application of the managementapproach (e.g. local workforce participationprogrammes, verification processes, outcomesor actions based on assessment of results).
● Case studies providing evidence of the company’s approach at the facility level.● Discuss coverage of programmes and the extent to which contractors are included.
Reporting elements
References
1. ILO. 1999. Report of the Director General: Decent Work. International Labour Organization 87th session, Geneva, June 1999.www.ilo.org/public/english/standards/relm/ilc/ilc87/rep-i.htm
2. ILO. 2002. Tripartite Meeting on the Promotion of Good Industrial Relations in Oil and Gas Production and Oil Refining.International Labour Organization, Geneva, 25 February–3 March 2002.www.ilo.org/public/english/dialogue/sector/techmeet/tmor02/conclude.htm
Health and safety indicators Workforce protection HS2: Workforce health
Description
Describe programmes and processes foridentifying and addressing significant workforcehealth issues, especially at the community andcountry level.
Purpose
Understanding the workforce health profile helpsidentify opportunities for improving workforcehealth and the company’s business performancethrough an effective health programme.
Scope
This leading indicator provides a group ofmeasures that focus on the potential health risks inthe workplace but can also include health issuesin the communities where businesses are located.Sources of information may include local publichealth officials, absenteeism, benefit claims, andclinic and incident data. Workforce health issuesvary widely by location. Dialogue with workforceis an effective method for obtaining anunderstanding of opportunities for improvement(see HS1, Workforce participation).
Occupational health programmes and processesto support a Health Management System (HMS),and health performance indicators, are describedin Health Performance Indicators, A Guide for theOil and Gas Industry (OGP-IPIECA, 2007). Keyelements of a HMS may include:● Health risk assessment: provides workplace
tools such as Health Risk Assessment (HRA) forhealth protection planning during the design ofnew projects, products and operations ormodifications to existing processes, products oroperations. This includes gender-based profileissues (e.g. cardiovascular data, chemicalexposure levels, reproductive heath, etc.).
● Industrial hygiene and control of workplaceexposures: focuses on potential health hazardsin the workplace, such as benzene, hearingconservation, confined space entry, food andwater safety, repetitive stress injury preventionprogrammes, etc.
● Medical emergency management: describesprocesses such as emergency response,emergency evacuation, communication andbusiness continuity plans.
● Management of ill health in the workplace:includes medical and psychological illness orinjury, and capability to deliver an appropriatelevel of routine and emergency care.
● Fitness for task assessment and healthsurveillance: provides methodology todetermine whether employees are safely ableto meet the essential physical, psychologicaland cognitive requirements of their job withoutrisk to self, others or the environment, and arenot impaired by fatigue, drugs, alcohol ordisabling medical conditions.
● Health impact assessment (HIA): detailsprocesses that support environmental andsocial impact assessments for new projects andthe reassessment of existing operations.
● Health reporting and record management:outlines steps that ensure documents,procedures, records and other information arecurrent, accessible and controlled for quality,confidentiality, legal compliance and retentionstandards.
● Public health interface and promotion ofgood health: describes programmes, based onrisk and epidemiological information, topromote personal health awareness in areassuch as obesity, smoking, nutrition, exercise,mental health, hygiene, and infectious andcommunicable diseases (e.g. tuberculosis,malaria, HIV/AIDS, food/water-borne illness,dengue, substance abuse, etc.).
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Health and safety indicators Workforce protection HS2: Workforce health
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by quantitativeillness incident rates as detailed in HS3,Occupational injury and illness incidents, and localcase studies. The workforce includes both companyemployees and contractors. Quantitative workforcedata should be consolidated within the company’sreporting boundary using the workforce approach(Appendix A).
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe processes and programmes thecompany has established for identifying andaddressing significant workforce health issuesat the local, regional and global level,together with resulting outcomes and plans.
● Describe health management system elements inplace and recent improvements to the system.
● Provide case study examples of health impactassessments (HIAs).
● Describe workforce health measures to prevent,reduce and manage communicable diseases,including voluntary testing, treatment,counselling and return to work.
● Describe workplace health training programmes for managers and workers, including programmes tomitigate impact on diversity, cultural and personal beliefs.
● Discuss the main health challenges at different operating locations, including approaches to addresslocal health issues.
Reporting elements
References
1. API. 2004. Five-point Approach to Addressing Workplace Ergonomics. (August 2004)
2. CDC (Centers for Disease Control and Prevention). Guidance documents on diseases (including SARS, HIV/AIDS, etc.) as well asworkplace health and safety, emergency preparedness and environmental health. www.cdc.gov
3. ILO. 2005. An ILO Code of Practice on HIV/AIDS and the World of Work. www.ilo.org/aids/lang--en/index.htm
4. OGP-IPIECA. Health ‘Good Practices’ series. Available at www.ipieca.org/library and at www.ogp.org.uk.
5. OGP-IPIECA. 2007. Health Performance Indicators: A guide for the oil and gas industry. www.ipieca.org/publication/health-performance-indicators
6. United Nations Programme on HIV/AIDS / Global Business Council / Prince of Wales Business Leaders’ Forum. 2000.The Business Response to HIV/AIDS: Impact and lessons learned. http://data.unaids.org/publications/IRC-pub05/jc445-businessresp_en.pdf
Health and safety indicators Workforce protection HS3: Occupational injury and illness incidents
Description
Report health and safety data on workforceinjuries or illnesses resulting from occupationalincidents.
Purpose
The reporting and analysis of workforceoccupational injury and illness incident ratesprovides trend and causation information onhealth and safety performance and assessment ofcontinuous improvement objectives. Incidentreporting and investigation supports consistencyof health and safety management standards, andfacilitates performance benchmarking among oiland gas companies.
Scope
The workforce includes both company employeesand contractors, whose data may be reportedseparately and/or as a total for the entireworkforce.
Guidelines for reporting injuries and illnesses havebeen published by a number of organizations,including the US Occupational Safety and HealthAdministration (OSHA), OGP and the EuropeanChemical Industry Council (CEFIC). There is broadalignment between them, but there are somedifferences in definitions and exemptions, thereforethe basis used should be clearly stated. Thepreferred basis is the OGP guidance, due towidespread adoption within the oil and gasindustry; however it is recognized that this may notbe appropriate for some companies in some areas.
The different guidelines all provide details on thedetermination of whether an event is a recordableoccupational incident. An occupational incident(i.e. a work-related event or exposure) in the
work environment may be recordable if it eithercaused or contributed (in any amount) to:● a new injury or illness;● an exacerbation of a pre-existing non-
occupational injury or illness; or● an exacerbation of a pre-existing occupational
injury or illness.
The guidelines provide details of exceptions toexclude incidents that have occurred in the workenvironment but are not occupational (i.e. notwork-related).
The guidelines also provide definitions forrecordability and the different categories ofrecordable incident severity including fatalities,lost time (days away from work) as well asrestricted duty and other recordable injuries orillnesses including medical treatment beyond firstaid. It is important for overall reporting integritythat injury or illness classifications are made onan accurate and consistent basis.
Reporting of total recordable injury and illness,lost time injury and illness, and fatality ratesshould include separate and combined rates forboth company employees and contracted
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Health and safety indicators Workforce protection HS3: Occupational injury and illness incidents
workers. Injury and illness counts and ratesshould be reported separately.
Data should be set into the appropriate contextthat can include interpretation of incident trends,or progress and plans aimed at achievingmanagement system objectives.
Companies should describe impacts, actions andlessons learned from major incidents. Companiesare encouraged to share High Learning ValueEvents (HLVE), defined as ‘events causing, orhaving the potential to cause, multiple seriousinjuries and/or fatalities’. The sharing of sufficientHLVE details and learnings can provide theindustry with recommendations and guidance toprevent recurrence.
The reporting of incidents provides ‘lagging’measures of safety performance. Companiesshould consider establishing and reportingappropriate ‘leading’ safety measures that relateto activities and behaviours. Such measures aremost effective when tailored to the specifics of theoperation and location (leading health measuresare provided in HS2, Workforce health). Leadingmeasures include near-miss events that did not
result in injury or illness; the reporting andinvestigation of near-misses can yield similarinsights to reporting and investigation of HLVEand other occupational incidents.
Reporting basis
The indicator is quantitative and reportable at aglobal level, and may be supported by qualitativedescriptions of incidents, responses and plans.Quantitative workforce injury and illness datashould be consolidated within the company’sreporting boundary using the workforceapproach (Appendix A). The workforce includesboth company employees and contractors.
The calculation method for determining ratesshould be clearly stated by indicating the numberof work-hours employed as the normalizationfactor. The recommended factors are thosedefined by OGP; these are per 1 million hoursworked for injury or illness rates, and per 100million hours worked for fatality rates. Companiesmay also use the factors commonly applied forOSHA incident reporting, which is per 200,000hours worked for injury or illness rates, and per1 million hours worked for fatality rates.
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Health and safety indicators Workforce protection HS3: Occupational injury and illness incidents
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References
1. CEFIC. 2001. Reporting of Occupational Illness Frequency Rate. www.cefic.be/Files/Publications/CEFIC1012-109.PDF
2. OGP. Health and Safety Data Reporting System Users’ Guide. This ‘User’s Guide’ for reporting health and safety data is typicallyupdated annually in December. Use of the most recent guide is recommended. www.ogp.org.uk
3. OGP-IPIECA. 2007. Health Performance Indicators: A guide for the oil and gas industry.www.ipieca.org/publication/health-performance-indicators
4. OSHA (U.S. Department of Labor, Occupational Safety and Health Administration). 2001. Recording and Reporting OccupationalInjuries and Illnesses. 29 CFR Part 1904. (January 2001).www.osha.gov/pls/oshaweb/owastand.display_standard_group?p_toc_level=1&p_part_number=1904
5. OSHA. Handbook on Injury and Illness Recordkeeping. www.osha.gov/recordkeeping/index.html
6. Step Change in Safety. 2006. Leading Performance Indicators—Guidance for Effective Use.http://stepchangeinsafety.net/stepchange/News/StreamContentPart.aspx?ID=1517
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Report occupational injuries separately foremployees and contractors:• Total Recordable Injury Rate;• Lost Time Injury Rate;• Number of fatalities (excluding illness fatalities);• Fatal Accident Rate (excluding illness fatalities);• Fatal Incident Rate.
● Describe incidents of major consequence,determined by the company, together with impactsand response actions.
● Report occupational illnesses separatelyfor employees and/or contractors:• Total Recordable Illness Rate;• Lost Time Illness Rate;• Number of fatalities.
● Describe initiatives to reduceoccupational incidents.
● Describe High Learning Value Events (HLVE), including how lessons learned have been shared. ● Reporting approach and application of leading safety measures that may include:
• significant near-miss events (including first-aid and ‘no-treatment’ incidents);• behaviour-based safety programmes, e.g. peer-to-peer observations, feedback sessions, or to
demonstrate workforce engagement and the maturity of an organization’s safety culture;• safety management system audits and site/activity assessments of the design and effectiveness of
the system and of improvement plans;• incident investigation completion and corrective action closure (demonstrates effective investigation
processes and management oversight);• workplace job safety/hazard analysis completion by the workforce (an indicator of safety culture);
and• health, safety and environmental orientations and training (track the number and effectiveness of
activities designed to raise awareness and improve competency of the workforce).
Reporting elements
Health and safety indicators Product health, safety and environmental risks
Customers have an increasing awareness ofhealth, safety and environmental risks related tothe everyday products they purchase andencounter. There is a constant drive to introducecleaner and better performing formulations forfuels, lubricants and other refined materials.Stakeholders are interested in productcomposition, hazards and recycling/disposal.
Assessment of the health, safety andenvironmental risks of new products andmaintenance of up-to-date information on existingproducts are standard practice. The issue is likelyto be more material for companies in thedownstream parts of the industry who provideproducts to end-user customers.
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Health and safety indicators Product health, safety and environmental risks HS4: Product stewardship
Description
The company’s approach to assessing andcommunicating product health, safety andenvironmental risks.
Purpose
Proactive assessment of Health, Safety andEnvironmental (HSE) impacts and management ofpotential HSE exposures to oil and gas industryproducts reduces and mitigates potential impactsto customers, employees, communities and theenvironment. In general, understanding thepotential HSE hazards of petroleum products,arising from human and environmental exposure,is based on experience and knowledge oftoxicological and exposure information. Themanagement of HSE risks related to products isregulated differently between countries. Thispresents challenges for companies operatingacross national borders. Newly-developedproducts need to be assessed prior to marketing toensure hazards and risks are recognized andmanaged.
Systematic processes are typically in place tomanage product HSE issues. Communication ofpotential hazards and risk management measuresto stakeholders is essential; Safety Data Sheets(SDSs) are a key means for this communication tocustomers. Additionally, the companies’ product-related management systems ensure effectiveexecution and continuous improvement.
Scope
This leading indicator applies to risk managementof products across the supply chain and theproduct life cycle (manufacture, transportation,final use and recycling or disposal, if applicable).It describes the processes applied by companies
to manage product risks to customers using threeelements:
1. Product HSE risk characterization to identifyand document risks and address findings,including:
• health risks based on toxicology hazardinformation and human exposureinformation;
• safety risks, especially those related tohazards of potential major accidents; and
• environmental risks related to the impact ofreleases, both intended (permitted) andunintended (i.e. spills).
2. Communication to provide SDSs and otherproduct HSE hazard or risk managementinformation to customers and, whereappropriate, product stewardship informationto those who buy and/or handle thecompany’s products.
3. Product HSE management system includingelements that:
• identify HSE hazards, and manage risks;
• specify and communicate precautions forusing, storing, handling, transporting anddisposing of products;
• maintain knowledge of HSE risks ofproducts;
• comprehend and comply with regulationswhere products are sold, or adoptreasonable standards of care whereregulations do not exist or are inadequate;and
• track and evaluate product stewardshipincidents.
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Health and safety indicators Product health, safety and environmental risks HS4: Product stewardship
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported byquantitative data on extent of programmes.Quantitative data should be consolidated withinthe company’s reporting boundary (Appendix A).
The indicator excludes environmental impactscovered within Section 4 of the Guidance.Normalization methods are not described forthese indicators due to the extensive range ofproduct types and diversity of regulatory regimes.
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Discuss the company’s approach to productassessments and how identified findings areaddressed.
● Describe the processes to provide Safety Data Sheets(SDS) and other risk management information tocustomers and to the public, as appropriate.
● Describe the Product Health, Safety andEnvironmental Management System.
● Report on activities to monitor, track,evaluate and manage product-relatedincidents.
● Quantitative data to provide scale to the narrative on product stewardship activities, such as numberof product assessments of potential impacts undertaken or the number of new and updated SDSsissued in the year compared to the total number of applicable SDSs in place at the end of the year.
Reporting elements
References
1. ICCA (International Council of Chemical Associations). Global Product Strategy (website).www.icca-chem.org/Home/ICCA-initiatives/Global-product-strategy
2. ISO. Management Standards: Understand the Basics (website).www.iso.org/iso/iso_catalogue/management_standards/understand_the_basics.htm
3. OECD. 2000. Guidelines for Multinational Enterprises. (Revised June 2000).http://www.oecd.org/department/0,3355,en_2649_34889_1_1_1_1_1,00.html
Health and safety indicators Process safety and asset integrity
Ensuring the safety of our workforce and thecommunities in which companies operate is ofprime importance to the oil and gas industry.Assuring asset integrity is integral to maintainingsafe operations. Process safety is the discipline ofpreventing an unplanned or uncontrolled loss ofprimary containment (LOPC) of hazardousmaterial from a process due to an unintendedevent or condition (e.g. release of hydrocarbonfrom its containment, that, if ignited, couldpotentially result in a major incident due toexplosion or fire). This includes LOPC of non-toxicand non-flammable substances in circumstanceswhere harm or damage could result.
Many technical and mechanical safeguards withinfacilities help prevent hydrocarbon releases. Anumber of associations and companies haveestablished metrics that are being adopted bycompanies in the oil and gas, petrochemical andchemical sectors. Although new metrics in thisarea are continuing to be developed, there isgeneral acceptance across the oil and gasindustry of recently published metrics to recordLOPC events, which are the basis for the newprocess safety indicator.
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Health and safety indicators Process safety and asset integrity HS5: Process safety
Description
Report the number and description of Tier 1 andTier 2 process safety events based on theconsequence criteria defined by API RecommendedPractice 754—Process Safety PerformanceIndicators for the Refining and PetrochemicalIndustries and OGP’s report entitled AssetIntegrity—Key Performance Indicators.
Purpose
Across the oil and gas industry, considerableeffort has been directed at the prevention ofmajor incidents resulting from loss of primarycontainment (LOPC). Such incidents arecharacterized as unintended process safety eventswith severe consequences. These can includemultiple fatalities, widespread environmentalimpact and/or significant property damage. Theset of reporting elements provide an industry-wideindicator of process safety events for trendingpurposes, and a predictive indicator of potentialprecursors to major LOPC incidents.
Scope
The detailed definition for this process safetyindicator has been defined by API RecommendedPractice 754 (API RP 754). This practice is alignedwith other industry sources such as those publishedby the Center for Chemical Process Safety (CCPS)and the International Association of Oil and GasProducers (OGP). These documents describe fourTiers providing a range of lagging and leadingmetrics as shown in Figure 7. Tier 1 has beenadopted by many companies and is the commonreporting element. Tier 2 is the supplementalreporting element, which was introduced in 2010,and is closely related to Tier 1 and existing LOPCmetrics. The other reporting elements are basedon Tiers 3 and 4, which are less established.
API RP 754 is focused on refining andpetrochemical operations but has widerapplicability. OGP has developed requirementsfor reporting Tier 1 and 2 indicators for upstreamproduction and drilling activities, which will bepublished within its annual Health and SafetyData Reporting System Users’ Guide, togetherwith separate implementation guidance on AssetIntegrity—Key Performance Indicators, whichcovers all four Tiers of metrics.
A Tier 1 process safety event is defined by APIRP 754 as an unplanned or uncontrolled LOPCrelease of any material, including non-toxic andnon-flammable materials (e.g. steam, hotcondensate, nitrogen or compressed air) from aprocess that results in one or more of thefollowing consequences:
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Indicator:HS5: Process safety
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Tier 1LOPC eventsof greater
consequence
Tier 3Challenges to safety systems
Tier 2LOPC events
of lesser consequence
Tier 4Operating discipline and
management system performance indicators
leading indicators
lagging indicators
Figure 7 The four Tiers of lagging and leading indicators
Reproduced from API Recommended Practice 754, courtesy of API
Health and safety indicators Process safety and asset integrity HS5: Process safety
1. An employee, contractor or subcontractor‘days away from work’ injury and/or fatality.
2. Hospital admission and/or fatality of a thirdparty.
3. Community evacuation or community shelter-in-place (officially declared by a local authority).
4. Fires or explosions resulting in greater than orequal to US$25,000 of direct cost to thecompany.
5. A pressure relief device (PRD) discharge resultsin one or more of four consequences—liquidcarryover; discharge to an unsafe location;on-site shelter-in-place; or a public protectivemeasure—and is in excess of the Tier 1threshold quantities detailed in API RP 754.
6. A release of material greater than the Tier 1threshold quantities in API RP 754, in any one-hour period.
A Tier 2 process safety event is broadly definedas an order of magnitude less severe than theTier 1 criteria above. (See API RP 754 fordetailed definitions and guidance).
It should be noted that any process safety eventcausing, or having the potential to cause, multipleserious injuries and/or fatalities, is also a HighLearning Value Event (HLVE) and can provideimportant learnings for industry, as described inHS3, Occupational injury and illness incidents.
It is recommended that companies report bothTier 1 and 2 process safety events, as well ascontext and narrative to broadly describe thenature, consequences and interpretation of the data.
In addition to the Tier 1 and 2 incidentreporting, companies are encouraged todevelop, select, use and evaluate site-specificprocess safety and asset integrity leadingmetrics. A leading metric reporting programmesupports continuous improvement of the
company’s safety performance. These Tier 3and 4 metrics should be based on the riskcontrol barriers identified through past incidents,company experience with risk controls, andknowledge of their specific sites and facilities.As Tier 3 and 4 metrics will be driven by site-specific programmes and issues, these are notenvisioned to be normalized or compared.
Reporting basis
The indicator is quantitative and should bereported for Tier 1 and 2 process safety events ata global level, supported by qualitativedescriptions of incidents, responses and plans.Quantitative data should be consolidated withinthe company’s reporting boundary using theoperational approach (Appendix A).
To provide comparability between major activitiesor companies of different scale, the number ofevents can be expressed as a normalized ratebased on workforce hours. A normalization factorof per 1 million hours worked is consistent withOGP reporting and is recommended, as appliedin HS3 for calculation of Occupational injury andillness incidents (see additional notes onnormalization, below).
Normalization
Tier 1 can be normalized for comparability, but isonly valid at an industry, business activity or largeenterprise level. It is not expected to be valid at anasset level. Tier 2 should be valid for moststatistical comparisons between assets. Most Tier 3and 4 indicators are not designed for industryroll-up or even for comparisons from asset toasset. Since Tiers 3 and 4 will often be asset-specific, each location should determine if countor rates are appropriate to assist them inanalysing their data.
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Number of Tier 1 process safety events withnarrative per API RP 754 definitions andreported per business activity (refining,upstream, etc.).
● Number of Tier 2 process safety eventswith narrative per API RP 754 definitionsand reported per business activity(refining, upstream, etc.).
● Reporting process safety event frequency rates (see ‘Normalization’ on page 80).● Describe approach and application of Tier 3 and 4 leading metrics, such as:
• demand on safety systems intended to protect against LOPC events (e.g. pressure relief valverelease, safety instrumented system events);
• HSE operating envelope deviations;• effectiveness of management system execution;• training and competency;• leadership/management committee/culture;• management of change; and• permit to work.
Reporting elements
References
1. API. 2010. ANSI/API Recommended Practice 754: Process Safety Performance Indicators for the Refining and PetrochemicalIndustries (First Edition, April 2010). Available from API at: www.api.org/Standards/new/api-rp-754.cfm
2. CCPS (Center for Chemical Process Safety). 2007. Guidelines for Risk-Based Process Safety. American Institute of ChemicalEngineers, New York, 2007.
3. CCPS. 2009. Guidelines for Process Safety Metrics. American Institution of Chemical Engineers, New York, 2009.
4. CCPS. 2008. Process Safety Leading and Lagging Metrics. American Institute of Chemical Engineers, New York, 2008.
5. OECD. 2008. Guidance on Developing Safety Performance Indicators Related to Chemical Accident Prevention, Preparednessand Response for Industry (2nd Edition). OECD Environment, Health and Safety Publications, Series on Chemical Accidents. No.19, Paris, 2008. www.oecd.org/dataoecd/6/57/41269710.pdf
6. OGP. 2008. Asset Integrity—the Key to Managing Major Incident Risks. OGP Report No. 415. www.ogp.org.uk/pubs/415.pdf
7. OGP. Health and Safety Data Reporting System Users’ Guide. This ‘User’s Guide’ for reporting health and safety data is typicallyupdated annually in December. Use of the most recent guide is recommended. www.ogp.org.uk
8. OGP. 2011. Asset Integrity—Key Performance Indicators. (Provides guidance for E&P industry use of API Recommended Practice754 and will be published in 2011). www.ogp.org.uk
9. UK Health and Safety Executive (HSE). 2006. Step-By-Step Guide to Developing Process Safety Performance Indicators. HSG254, Sudbury, Suffolk, UK, 2006. www.hse.gov.uk/pubns/books/hsg254.htm
There is no uniformly applicable normalizationfactor for process safety/asset integrity indicators.As such, companies may want to develop aspecific normalized rate. However, generalconsensus prefers to use worker exposure hours
(as used for injury rates) as a convenient, easilyobtained factor for Tier 1 and 2 indicators. Thisprovides some ability for year-to-year trendingand allows for rough comparison between similarbusiness activities.
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Section 6:
Social and economicindicators
Social and economic indicators
By the very nature of the location of oil and gasreserves and their development, oil and gascompanies can face challenging social andeconomic issues. For global companies, thosechallenges vary across operating areas. Giventhis complexity and diversity, reporting in thearea of social responsibility is developing, as isthe understanding of economic factors that relateto sustainability.
This Guidance provides indicators across fivecategories likely to be material for companies:community and society; local content; humanrights; business ethics and transparency; andlabour practices. This section includes 18 socialand economic indicators within these categories
(see table below). Because of the complexity andlocal dimension of these issues, the majority ofindicators in this section are based on qualitativedescriptions of a company’s managementapproach. Each company, in line with theanalysis in Section 2 (Step 3), can determinewhich of these issue categories and indicators arematerial for reporting.
The indicators reflect the evolution of social andeconomic reporting. For this reason, the indicatorscontain a range of options for reporting, withadditional guidance in the scope sections.Companies may take a flexible approach to use ofthe indicators, and are encouraged to build on theintent and suggestions within this section.
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Summary of social and economic indicators
Issue category Indicator Page number
Community and society SE1: Local community impacts and engagement 86 SE2: Indigenous peoples 88 SE3: Involuntary resettlement 90 SE4: Social investment 92
Local content SE5: Local content practices 95 SE6: Local hiring practices 97 SE7: Local procurement and supplier development 98
Human rights SE8: Human rights due diligence 101 SE9: Human rights and suppliers 103 SE10: Security and human rights 104
Business ethics and SE11: Preventing corruption 106transparency SE12: Preventing corruption involving business partners 107 SE13: Transparency of payments to host governments 108 SE14: Public advocacy and lobbying 109
Labour practices SE15: Workforce diversity and inclusion 111 SE16: Workforce engagement 112 SE17: Workforce training and development 113 SE18: Non-retaliation and grievance system 114
Social and economic indicators Community and society
The oil and gas industry operates all over theworld, often in remote regions and diversecommunities. Understanding and addressing theinterests of societies, different social groups, andcommunities that may affect, or be affected by, oiland gas operations, is often an importantcomponent of designing and executing successfuland sustainable oil and gas projects. Stakeholderslinked to such projects, including the localworkforce, suppliers and communities, aretypically diverse and multi-layered, with a varietyof voices and representatives. Achieving commonunderstanding of interests and concerns isessential for engagement to be meaningful andcapable of contributing to mutual respect, trustand confidence.
Lack of consultation and collaboration with localcommunities can lead to project disruption,delays, costs and—in today’s networked world—apotential escalation of local issues to the globalstage. Conversely, successful engagement withhost communities may see companies accepted
for the ways in which they help to enhance thelivelihood, well-being and economic future of alocale and those who live there.
Companies should report on their systematicapproach to managing interactions with societiesand communities including, where relevant, onthe four indicators provided here.
The first of these indicators asks companies toreport on their overall systems for managingimpacts on, and engaging with, communitiesrelevant to company operations. The next twoindicators provide options for more specificreporting. These may affect, or be affected by,indigenous peoples and/or involve involuntaryresettlement. Finally, companies are encouragedto report on the use and effectiveness ofcommunity and social investments in areas inwhich they operate, as instruments forestablishing and maintaining mutually beneficialrelationships with local, regional and nationalstakeholders.
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Introducing the issue:Community and society
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Description
Describe policies, strategies and procedures forunderstanding and addressing local communityimpacts and engaging with affected stakeholders.
Purpose
Oil and gas activities are typically long term andmay have a variety of impacts on local communitiesand different social groups. Timely engagementand management of impacts on communities iscentral to the company’s ability to build trust andconfidence and to safeguard its licence to operate.
Engaging meaningfully with affected stakeholderswithin local communities at an early stage, andcontinuously throughout the lifecycle of a projector operation, is important to ensure successful andsustainable operations. In addition to being a keycomponent of assessing and addressing potentialimpacts on local communities, engagement withaffected stakeholders helps establish constructiveand long-lasting relationships and can providevaluable inputs into the decision-making processfor projects or operations.
Scope
The term ‘affected stakeholder’ is aligned withproposed definitions within the 2010 review ofthe International Finance Corporation (IFC) Policyand Performance Standards on Social andEnvironmental Sustainability. For this indicator,affected stakeholders include individuals,administrations, businesses and otherrepresentatives of civil society within a localcommunity. ‘Local community’ includes thosegroups of people who live or work sufficientlynearby to be potentially impacted by thecompany’s operations, and is not restricted to‘fence-line’ neighbours of a facility.
The reporting company should describe its overallapproach to engagement with affectedstakeholders, as well as to local communityimpact assessment and mitigation. This caninclude descriptions of: ● stakeholder engagement strategies and
processes that are appropriately targeted,timely, inclusive and representative of differentsocial groups (e.g. women, youth, minoritiesand potentially vulnerable groups);
● impact assessment processes, and how theseinform strategy, project or operation design,and implementation;
● grievance mechanisms, where relevant; and ● monitoring and follow-up procedures,
throughout the project lifecycle.
At a supplemental reporting level, in particular inrelation to major projects, case studies can beincluded to illustrate how approaches are put intopractice. The case studies may discuss evidence ofeffectiveness and outcomes from affectedstakeholder engagement plans and/ormanagement of local community impacts togetherwith examples of issues and lessons learned frommonitoring and evaluation. Case studies can
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Social and economic indicators Community and society SE1: Local community impacts and engagement
describe how the company responded to issuesraised by affected stakeholders, and the extent oflocal community support for the company’ssubsequent decisions.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by local casestudies.
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Social and economic indicators Community and society SE1: Local community impacts and engagement
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe policies, strategies and proceduresfor understanding and addressing localcommunity impacts and engaging withaffected stakeholders.
● Case studies to illustrate effectiveness andoutcomes from engagement with affectedstakeholders and/or management ofimpacts on the local community.
● Describe efforts to assess and understand community perceptions of company impacts and activities,such as self-appraisal, use of reliable and unbiased third-party or independent research and surveysdeveloped in collaboration with the affected stakeholders and local community.
● Quantitative measures include: • the number and/or percentage of sites with grievance processes or similar conflict resolution
procedures in place; and • data on the types of concerns raised via engagement or grievance mechanisms, and how concerns
have been addressed. ● Discuss the company’s approach to partnerships with relevant stakeholders, including communities,
civil society, other companies and/or governments.
Reporting elements
References
1. IFC. 2006. Policy and Performance Standards on Social and Environmental Sustainability.www.ifc.org/ifcext/sustainability.nsf/Content/EnvSocStandards
2. IFC. 2007. Stakeholder Engagement: A Good Practice Handbook for Companies Doing Business in Emerging Markets.www.ifc.org/ifcext/sustainability.nsf/Content/Publications_Handbook_StakeholderEngagement
3. IPIECA. 2006. Partnerships in the Oil and Gas Industry. Contains case studies of oil and gas companies working in multi-stakeholder partnerships to support sustainable development goals. www.ipieca.org/publication/partnerships-oil-and-gas-industry
4. IPIECA. 2008. Creating Successful, Sustainable Social Investment: Guidance Document for the Oil and Gas Industry.Contains information on social investment processes, including measuring effectiveness.www.ipieca.org/publication/guide-successful-sustainable-social-investment-oil-and-gas-industry
5. WRI. 2009. Breaking Ground: Engaging Communities in Extractive and Infrastructure Projects.www.wri.org/publication/breaking-ground-engaging-communities
6. Zandvliet, Luc and Anderson, Mary B. 2009. Getting it Right: Making Corporate-Community Relations Work. Greenleaf Publishing.www.greenleaf-publishing.com/productdetail.kmod?productid=2830
Description
Describe policies, programmes and proceduresused for engagement with indigenous peoples andfor addressing their concerns and expectations.
Purpose
This indicator demonstrates the company’sapproach to managing interactions with indigenouspeoples, when that is relevant. The InternationalFinance Corporation’s (IFC’s) PerformanceStandard 7 notes that indigenous peoples—associal groups with different identities from dominantgroups in society—are often likely to be relativelymarginalized and vulnerable. Their status in society(whether economic, social or legal) often limits theirability to defend their rights and interests in relationto lands, and natural and cultural resources. Insome countries they are afforded special rights orprotection; in others they receive little or noprotection, or protection of their rights is notenforced. Companies with operations or activitiesthat may affect, or be affected by, indigenousgroups should engage with them to understandand address their concerns and expectations.
Scope
The reporting company should describe itsapproach to engaging with indigenous peoples.This can include description of processes andmechanisms related to:● avoidance, minimization and mitigation of
potential impacts;● relocation (see also SE3, Involuntary resettlement);● information disclosure, consultation and
informed participation (including ensuringaccess to culturally appropriate and accessiblegrievance mechanisms); and
● identification and implementation ofdevelopment benefits (including access to jobsand supply opportunities).
At a supplemental level, provide case studies,examples or other evidence of how indigenouspeoples (including their traditional knowledgeand cultural resources) are taken intoconsideration in the project planning, decision-making and impact mitigation processes.
There is no universally accepted definition of‘indigenous peoples’. In this Guidance the term isused in a generic sense, as suggested by the IFC’sPerformance Standard 7, referring to:
‘A distinct social and cultural grouppossessing the following characteristics invarying degrees:
• Self-identification as members of a distinctindigenous cultural group and recognitionof this identity by others.
• Collective attachment to geographicallydistinct habitats or ancestral territories inthe project area and to the naturalresources in these habitats and territories.
• Customary cultural, economic, social andpolitical institutions separate from those ofthe dominant society or culture.
• An indigenous language, often differentfrom the official language of the countryor region.’
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Social and economic indicators Community and society SE2: Indigenous peoples
Several definitions exist for the term ‘indigenous’,including those of the United Nations and theInternational Labour Organization (ILO), and oflegislation specific to a country. The reportingcompany should take care to explain the term asused in its reporting.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by local casestudies.
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Social and economic indicators Community and society SE2: Indigenous peoples
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Descriptions of policies, programmes and/orprocedures used to engage with indigenouspeoples and address their concerns andexpectations.
● Case studies, examples or other evidenceof indigenous peoples’ participation inprojects.
● Description of perspectives and views from, and assessment of issues raised by, indigenous peoples inspecified countries, and actions taken by the company to address the issues.
Reporting elements
References
1. IFC. 2006. Performance Standard 7: Indigenous Peoples. Performance standards on social and environmental sustainability.www.ifc.org/ifcext/sustainability.nsf/Content/PerformanceStandards
2. ILO. 1989. Convention 169 on Indigenous and Tribal Peoples.www.ilo.org/ilolex/cgi-lex/convde.pl?C169
3. IPIECA. 2011. Indigenous Peoples and the oil and gas industry—Context, issues and emerging good practice. Scheduled forpublication in 2011. www.ipieca.org
4. United Nations General Assembly (UNGA). 2007. Declaration on the Rights of Indigenous Peoples. Adopted by the UNGA in 2007.www.un.org/esa/socdev/unpfii/en/drip.html
Description
Describe policies, programmes and/orprocedures related to involuntary resettlement.
Purpose
Oil and gas activities may involve involuntaryresettlement of people and/or their economicactivities. This indicator provides insight into acompany’s efforts to avoid or limit involuntaryresettlement, and to provide fair and transparentcompensation as appropriate.
Scope
The reporting company should describe itsapproach to avoiding, mitigating and/orcompensating for involuntary resettlement.Involuntary resettlement refers both to physicaldisplacement (i.e. relocation or loss of shelter)and to economic displacement (i.e. loss of assetsor access to assets that leads to loss of incomesources or means of livelihood) ofindividuals/communities as a result of project-related activities.
When describing policies, programmes and/orprocedures for involuntary resettlement,companies can include information on a numberof related processes:● project design (resettlement avoidance or
minimization);● compensation, livelihood restoration and
benefits for affected people;● capacity building and consultation
mechanisms;● grievance mechanisms;● resettlement planning and implementation; and● monitoring mechanisms to assess progress.
At a supplemental reporting level, companiesmay list and quantify cases of involuntaryresettlement during the reporting period. This caninclude the number of households resettled ineach case; and an explanation of how livelihoodswere affected and restored in the process.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by local casestudies.
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Social and economic indicators Community and society SE3: Involuntary resettlement
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of policies, programmes and/orprocedures for involuntary resettlement.
● List, quantify and/or describe cases ofinvoluntary resettlement required by thecompany’s activities (where governmentspermit disclosure).
● Qualitative case studies describing how the process was implemented in specific cases, for example: • any challenges encountered and how these were resolved;• how fair compensation was calculated and/or livelihood restoration provided;• why involuntary resettlement was unavoidable; and• the provisions for any land returned at abandonment/closure, if applicable.
● Future plans that may involve involuntary resettlement and describe how potential adverse impactswill be avoided or minimized.
Reporting elements
References
1. IFC. 2006. Performance Standard 1: Social and Environmental Assessment and Management Systems. Performance standards onsocial and environmental sustainability. www.ifc.org/ifcext/sustainability.nsf/Content/PerformanceStandards
2. IFC. 2006. Performance Standard 5: Land Acquisition and Involuntary Resettlement. Performance standards on social andenvironmental sustainability. www.ifc.org/ifcext/sustainability.nsf/Content/PerformanceStandards
Description
Describe strategies, programmes and proceduresrelating to social investment, and their effectiveness.
Purpose
This indicator demonstrates a company’sapproach to social investment. Since socialinvestment decisions are often the result ofconsultation and engagement activities aimed atunderstanding and meeting community needs andaspirations, successful social investment projectscan be an indicator of the quality of relationshipsof a company with local communities.
Scope
Companies should describe their overarchingsocial investment strategy. This may includedescriptions of corporate objectives, engagementstrategy on social investments, decision-makingcriteria, and spending to support communitydevelopment. Companies can include details onwhether initiatives are community-owned anddriven, third-party or company-facilitated.
At a supplemental reporting level, companies candiscuss the effectiveness of their social investments,including descriptions of: ● processes and methods for assessing and
evaluating social investment effectiveness;● outcomes, impacts and lessons-learned; and ● how social investments may have attracted
additional funding to the community from othersources, other long-term partnerships and/orother development activities.
Social investment generally includes company-financed investments and donations for charity,community and social development programmes.It can include contributions of expertise, access tofacilities, training or other non-financial resources.
Reporting basis
The indicator has both qualitative and quantitativeaspects, is reportable at a global level, and maybe supported by local case studies. Quantitativedata should be consolidated within the company’sreporting boundary (Appendix A).
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Indicator:SE4: Social investment
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Social and economic indicators Community and society SE4: Social investment
The company should define what it considers associal investment. In particular when reportingfinancial data, explain the basis for reportingtotal social investment spend (e.g. whether itincludes employee giving, marketing projects,
sponsorship, and leveraged funding). Socialinvestment is separate from any compensationprocedures described in SE3, Involuntaryresettlement.
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Social and economic indicators Community and society SE4: Social investment
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of the company’s socialinvestment strategies, programmesand procedures.
● Total social investment.
● Appraisal of quality and effectiveness of socialinvestment strategy, including outcomes and impacts.
● Social investment broken down by region orcountry.
● Case studies to illustrate implementation of strategy implementation and associated lessons learned,for example:• how significant segments of the local community feel they are benefiting, including the extent to
which livelihoods and economic opportunities are improving; or• whether social investments are fostering improved community relations or creating tensions.
● Report total social investment, split into voluntary and contractually obligated spend.
Reporting elements
References
1. IPIECA. 2008. Creating Successful, Sustainable Social Investment: Guidance Document for the Oil and Gas Industry. Contains information on social investment processes, including measuring effectiveness.www.ipieca.org/publication/guide-successful-sustainable-social-investment-oil-and-gas-industry
2. The London Benchmarking Group provides a model used by many companies around the world to assess and report on the valueand achievements of their social investments. www.lbg-online.net/lbg
Social and economic indicators Local content
Local content has emerged as a key aspect ofsocial performance for oil and gas companies.For purposes of this Guidance, local content isdefined as:
‘The added value brought to a host nation(national, regional and local areas in thatcountry, including communities) through theactivities of the oil and gas industry. Thismay be measured (by project, affiliateand/or country aggregate) and undertakenthrough activities such as, but not limited to:• workforce development (international and
national oil companies; contractors andsubcontractors):- employment of national, regional and
local workforce;- training of national, regional and local
workforce;• investments in contractor/supplier
development (all oil and gas industry goodsand services, including engineering andfabrication yards):
- developing supplies and services locally;- procuring supplies and services locally.’
For oil and gas companies, opportunities to addlocal value arise across operations. While much ofthe focus around local content is often directed atlow- and middle-income countries, in reality theremay be expectations as to companies’contributions and activities anywhere in the world.
Reporting companies may report on countrieswhere local content aspects may be of materialconcern to the business, and on its sustainabilityimpacts or objectives. Information on local contentmanagement and performance is typicallyreported at a national level, but in certaincircumstances may be provided at a regional,state or community level. Reporting on localcontent may be required by formal agreements orlegislation, or because of clear expectations fromhost governments or stakeholders.
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Description
Describe policies and practices related to localcontent.
Purpose
Companies in the oil and gas industry faceexternal expectations regarding sourcing ofgoods and services and hiring of people fromwithin the host countries in which they operate.Legislation or specific agreements with hostcountries may include local content requirements.Local content practices can bring a range ofbusiness benefits, including lower operating costs,increased local and national commitment, andcloser business alignment with government goalsfor development and local capacity building.
Scope
Companies should describe their approach tosourcing of goods, services and human resourcesfrom within relevant host countries at differentstages of operation. The description may includespecific objectives or plans that enable localsourcing of goods, services and labour.
At a supplemental reporting level, companies mayinclude case studies to convey their approach at alocal level, including how companies havecascaded requirements to contractors and howany issues have been addressed. Companies maydiscuss how local capacity assessments andengagement with stakeholders helped anticipatethe range of goods, services, skills andcompetencies necessary for project delivery—andhow they may best be developed and met locally.Companies may also list countries/regionswhere assessments have been conducted onlocal capacity to supply goods and services andexisting skills and competencies of the locallabour force.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by local casestudies.
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Indicator:SE5: Local content practices
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Social and economic indicators Local content SE5: Local content practices
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Company policies, strategies andapproaches to sourcing goods,services and human resources.
● Using case studies, describe how company policies,strategies and approaches are implemented locally,including results and lessons learned.
● List of countries/regions where local capacityassessments have been made.
● Quantify the number (or percentage) of its organizational entities that are covered by formalagreements or legislation within host countries regarding local content.
● Case studies may be useful for discussing the socio-economic impacts of company local contentactivities on the host country. This may be linked to reporting of indicator SE1, Local communityimpacts and engagement.
Reporting elements
References
1. IPIECA. 2011. Oil and Gas Industry Guidance on Developing a Local Content Strategy. Scheduled for publication in 2011.www.ipieca.org
Description
Describe the company’s approach to, andprogrammes for, providing employment opportunitiesto residents or nationals of host countries.
Purpose
This indicator demonstrates the reach andeffectiveness of a company’s management strategyon local employment in relevant locations. It is oneaspect of the company’s local economic impact.
Scope
Companies should describe the nature andeffectiveness of their processes and strategy aimedat providing employment opportunities to residentsor nationals of host countries, broken down bycountries, business units or other areas where
relevant. This should include descriptions of:● processes related to staff hiring, appraisal,
training, development and progression; and● specific education programmes to enhance
local employability.
At a supplemental reporting level, companies canprovide further evidence of their programmes byreporting and discussing annual statistical dataon local hiring related to key job posts in relevantlocations.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by quantitativeinformation and local case studies. If reported,quantitative data should be consolidated withinthe company’s reporting boundary (Appendix A).
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Indicator:SE6: Local hiring practices
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Social and economic indicators Local content SE6: Local hiring practices
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of nature and effectivenessof processes and strategy aimed atproviding employment opportunities toresidents or nationals of host countries.
● Number and/or percentage of local (national)versus expatriate (international) employees inmanagement and other senior roles in targetcountries or regions.
● Provide information on how local employment strategies promote diversity and inclusion (e.g. inrelation to gender, ethnicity, disability) at the local level. Include management roles. (See also SE15,Workforce diversity and inclusion.)
● Include information and/or quantitative data on local employees that are given training in other(non-local) assets of the company.
● Discussion on indirect job creation as a result of the company’s activities.
Reporting elements
References
Econometric models exist for estimating multiplier effects (creation of indirect jobs), which may be found in the following (among others):
1. EBRD (European Bank for Reconstruction and Development). Maximising the Positive Socio-Economic Impact of Mineral Extraction onRegional Development in Transition Economies: A Review of the Literature. www.ebrd.com/downloads/research/economics/auty.pdf
2. ICMM (International Council on Mining and Metals). 2008. Resource Endowment Toolkit: The Challenge of Mineral Wealth: UsingResource Endowments to Foster Sustainable Development. www.icmm.com/document/423
Description
Describe the company’s programmes andprocesses to improve the ability of local suppliersand contractors to support operations and carryout projects.
Purpose
Given the extent of activity in the industry,dependent on suppliers and contractors, companyapproaches to procurement and to working withsuppliers and potential suppliers play a pivotalrole in developing and accessing supply chains inregions of activity—and in sharing global workpractices with local companies.
Scope
Companies should describe how they help localsuppliers and contractors to competitively servicethe needs of the company and business generally,in line with business requirements. The indicatorfocuses on actions taken to improve participation
of local suppliers. This can include efforts tosimplify the procurement process for localsuppliers (e.g. unbundling, access to financing, orshorter-term contracts) and to increase suppliercapability to meet company standards (e.g. skillstraining, health, safety and environment).
At a supplemental reporting level, companies mayreport expenditure on locally sourced goods andservices within selected host countries as apercentage of total national procurement budgets.Companies may describe activities or investmentsundertaken to assist supplier development (e.g.capacity building, technical assistance ortechnology transfer, supplier network development).
Reporting basis
The indicator is primarily qualitative andreportable at a global level, and may besupported by local case studies. If reported,quantitative data should be consolidated withinthe company’s reporting boundary (Appendix A).
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Indicator:SE7: Local procurement and supplier development
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Social and economic indicators Local content SE7: Local procurement and supplier development
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of programmes andprocesses to improve the ability of localsuppliers and contractors to supportoperations and projects.
● Proportion of money spent on goods and servicessourced locally.
● Description of further activities undertaken to assistsupplier development.
● Describe how the procurement process facilitates or encourages first-tier suppliers and contractors tobuy locally.
● Discuss pre-qualification criteria for potential suppliers, which could include:• track record of working with local firms;• strategies for developing local content in a given country; and• demonstrable experience of developing capacity of local suppliers and subcontractors.
● Evidence of local business development not directly related to meeting current company needs, but asa result of increased economic activity and opportunities made possible by the project and its localeconomic benefits.
Reporting elements
References
1. Engineers Against Poverty. Maximising the Contributions of Local Enterprises to the Supply Chain of Oil, Gas and Mining Projectsin Low Income Countries. A briefing note for supply chain managers and technical end users.www.engineersagainstpoverty.org/_db/_documents/EAP_Briefing_Note_-_Local_Enterprise_Participation.pdf
2. WBCSD. 2007. Issue brief: Promoting Small and Medium Enterprises for Sustainable Development.www.wbcsd.org/Plugins/DocSearch/details.asp?DocTypeId=25&ObjectId=MjU1MTM
Social and economic indicators Human rights
The basic values of dignity and equality ofindividuals, like many other core principles thatunderlie human rights, are embodied within theUnited Nations (UN) Universal Declaration ofHuman Rights.
In line with the Protect, Respect and Remedyframework set out by the UN Secretary-General’sSpecial Representative on Business and HumanRights, and endorsed by the UN Human RightsCouncil, it is the duty of governments to protectagainst human rights abuses. It is theresponsibility of companies to respect humanrights. The oil and gas industry operates in someof the most challenging locations in the world,and can face complex human rights-relatedissues. Companies that operate in suchchallenging areas may report on the relevance of
human rights to their operations. The indicatorsare qualitative and focus on general duediligence aspects, as well as on specific areasrelated to suppliers and security.
For the purpose of this Guidance, the definition of‘human rights’ comes from the International Bill ofRights1 and the 1998 Declaration onFundamental Principles and Rights at Work of theInternational Labour Organization, including: ● freedom of association and the effective
recognition of the right to collectivebargaining;
● elimination of all forms of forced orcompulsory labour;
● effective abolition of child labour; and ● elimination of discrimination in respect of
employment and occupation.
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1 The International Bill of Rights includes the Universal Declaration on Human Rights (UDHR), the International Covenant on Civil andPolitical Rights (ICCPR) and the International Covenant on Economic, Social and Cultural Rights (ICESCR).
Description
Describe policies, programmes and procedures thecompany has in place to respect human rights—including the rights of workers—in its operations.
Purpose
The indicator offers an overview of the duediligence carried out by the reporting company insupport of respecting human rights.
Scope
Companies should describe their due diligenceprocess related to human rights and labourstandards, including as referenced in the UNProtect, Respect and Remedy framework. This caninclude descriptions of: ● relevant policies and guidance related to
human rights, including external commitmentsor initiatives;
● procedures in place to assess and preventadverse human rights impacts; and
● efforts made to integrate relevant policies andcommitments.
At a supplemental reporting level, companiesmay describe internal monitoring and auditingprocesses undertaken to track implementation ofstandards, policies or procedures related tohuman rights. This may include outcomes ofassessments and potential challenges.
Companies can consider reporting on the scopeand content of training programmes on humanrights. This can include quantitative data on thetraining offered and a description of trainingplans, the target group for the training, and theanticipated percentage of the target group thatshould have received the training during thereporting year.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by local casestudies.
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Indicator:SE8: Human rights due diligence
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe company policies,programmes and/or procedures thatsupport respect for human rights.
● Descriptions of monitoring and auditing processesto track implementation of relevant policies,programmes and procedures.
● Scope, content and tracking of human rightstraining programmes.
● Provide additional context on the relevance of human rights and core labour standards tooperations, which may include references to external country and/or human rights risk indices orrankings.
● Case studies to illustrate how potential human rights issues related to company operations are beingaddressed at a local level.
● Qualitative and/or quantitative measures for tracking implementation and outcomes of policies andprocedures (e.g. human rights considerations in evaluating investments and/or business relationships,and results of monitoring/auditing).
● Details of targets set regarding the company’s human rights performance (e.g. qualitative and/orquantitative measures to track the effectiveness of human rights training).
Reporting elements
References
1. Danish Institute for Human Rights. 2005. Human Rights Compliance Assessment Tool. (Second edition, 2010).www.humanrightsbusiness.org/?f=compliance_assessment
2. GRI. 2009. A Resource Guide to Corporate Human Rights Reporting. (GRI Research and Development Series).www.globalreporting.org/NR/rdonlyres/4C5DB4C6-5084-4A84-BE51-0D134B3B5A2E/3583/HR_ReportFINAL_Resource_Guide.pdf
3. ICCPR (The International Covenant on Civil and Political Rights). 1966. Adopted by the United Nations General Assembly inDecember 1966. www2.ohchr.org/english/law/ccpr.htm
4. ILO. 1998. Declaration on Fundamental Principles and Rights at Work. www.ilo.org/declaration/lang--en/index.htm
5. OECD. 2000. Guidelines for Multinational Enterprises. www.oecd.org/department/0,3355,en_2649_34889_1_1_1_1_1,00.html
6. Professor John Ruggie, UN Secretary-General’s Special Representative for Business and Human Rights. 2008. Protect, Respect andRemedy: a Framework for Human Rights and Business. www.business-humanrights.org/Links/Repository/965591
7. UDHR (Universal Declaration of Human Rights). 1948. Adopted by the United Nations General Assembly in December 1948.www.un.org/en/documents/udhr/index.shtml
8. Voluntary Principles on Security and Human Rights. 2000. www.voluntaryprinciples.org
Description
Describe policies, programmes and/or proceduresin place for promoting respect for human rightsby suppliers.
Purpose
Suppliers often play a key role in the provision ofgoods and services to the oil and gas industry.Hence, the human rights performance ofsuppliers can have a significant impact on oiland gas operations.
Scope
The reporting company should describe itssystematic approach, in procurement andcontracting, to promote respect for human andlabour rights by its suppliers. This can include: ● policies, programmes and procedures in place
for promoting respect for human rights;● steps taken before entering into contracts with
suppliers and contractors; and ● processes to monitor compliance with relevant
clauses included in contracts with suppliers.
At a supplemental reporting level, companiesmay include quantitative information byestimating the expected percentage of significantcontracts that contain specific human rightsclauses. Definition of the term ‘significant’ couldbe based on the size of the contract issued tosuppliers in particular regions/countries or othercriteria set out by the reporting company.
Companies may discuss specific efforts aimed atsuppliers to develop common goals, attitudes andbehaviour related to respecting human rights.
Reporting basis
The indicator is qualitative and reportable at aglobal level and may be supported by local casestudies. The company should determine whichissues related to their supply chains are material forreporting (Section 2, Step 3). Where quantitativedata is included, the company should determinean appropriate reporting boundary, includingconsideration of the extent to which subcontractorsand further levels of the supply chain areincluded. (See Appendix A for further guidance.)
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Indicator:SE9: Human rights and suppliers
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Social and economic indicators Human rights SE9: Human rights and suppliers
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of policies, programmes and/orprocedures that the company has forpromoting respect for human rights andcore labour standards by suppliers.
● Estimated percentage of significantcontracts with relevant clauses.
● Efforts aimed at suppliers to promoterespect for human rights.
● Describe mechanisms to monitor supplier adherence to contractual agreements related to humanrights, and actions taken when findings do not meet the company’s expectations.
Reporting elements
Description
Describe policies, programmes and/orprocedures related to security and human rights.
Purpose
Maintaining safe and secure operations whilerespecting human rights is an important elementof oil and gas operations. This indicatordemonstrates how the reporting companymanages and monitors performance pertaining tosecurity and human rights.
Scope
The reporting company should describe thecompany’s approach to security and human rightspractices. This may include a description ofrelevant global level policies, procedures and/orguidelines, such as: ● risk assessment processes;● procedures to monitor, report and respond to
security-related incidents with human rightsimplications;
● procedures for entering into relations withpublic or private security providers; and
● efforts to raise awareness of security andhuman rights for relevant staff.
At a supplemental reporting level, companiesmay discuss implementation of their country-specific policies, programmes and/or procedures.This may include an overview of countries whereimplementation is taking place, such as:● descriptions of engagement with stakeholders;● criteria for the selection and contracting of
private security forces or arrangements withpublic security forces; and
● examples of support for outreach, educationand training of relevant personnel, privatesecurity, public security and civil society.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by country-level information.
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Indicator:SE10: Security and human rights
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Social and economic indicators Human rights SE10: Security and human rights
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of relevant policies,procedures, and/or guidelines pertainingto security and human rights.
● Description of how policies, programmes and/orprocedures related to security and human rightsare implemented at the country-specific level.
● Companies that are participants in the Voluntary Principles on Security and Human Rights (VPSHR)may also report on implementation of the Voluntary Principles.
● Report on specific objectives set during the reporting period, or on lessons and issues encountered atthe country level.
Reporting elements
References
1. Voluntary Principles on Security and Human Rights. 2000. www.voluntaryprinciples.org
2. The Voluntary Principles Steering Committee. 2009. Voluntary Principles on Security and Human Rights Reporting Guideline.
Social and economic indicators Business ethics and transparency
The bribing of private or public persons to obtainbusiness advantage can distort internationalcompetitive conditions and negatively affect theeconomic and political progress of societies, inaddition to being illegal in most countries. Thereare international conventions against corruption,and relevant domestic legislation exists in manycountries (though it may differ between them).The following are significant anti-corruptionprinciples and initiatives of relevance to business:● International Chamber of Commerce (ICC):
Rules of Conduct against Extortion andBribery;
● Transparency International: Business Principlesfor Countering Bribery;
● United Nations Global Compact:10th Principle;
● World Economic Forum (WEF): PartneringAgainst Corruption Initiative (PACI);
● Organisation for Economic Co-operation andDevelopment (OECD) Guidelines; and
● US Foreign Corrupt Practices Act (FCPA).
A company’s approach to ethical standards(management awareness and procedures and theability of staff to identify opportunities to meetobjectives) is relevant at all levels. Ethical
standards and practices aimed at preventingcorruption, including bribery, are the focus of thefirst two indicators in this section.
Oil and gas companies contribute large sums ofmoney to the fiscal revenue streams of hostgovernments. Revenue transparency is amechanism for disclosing information aboutrevenue flows from oil and gas activities inresource-rich countries. The best-known effortaimed at promoting and standardizing revenuetransparency is the Extractive IndustriesTransparency Initiative (EITI), under which:● companies within a country report on their
material payments to the host government;● the host government reports what it receives;
and ● a public report on company payments and
government revenues is issued.
Business can also have influence throughparticipation in public policy debates and input tolegislative developments. Engagement of this sortis both legitimate and necessary, but transparencyof political engagement and financialcontributions is an important part of maintainingtrust with a variety of stakeholders.
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Description
Describe policies, programmes and procedures toprevent bribery and corruption, and mechanismsto monitor compliance.
Purpose
This indicator demonstrates the company’s policiesand commitments to prevent employees fromviolating applicable anti-bribery/anti-corruptionlaws, and procedures in relation to parties withwhom the company does business.
Scope
Companies should describe key elements of thecompany’s approach to preventing corruptionincluding giving or receiving bribes. Companiesshould refer to mechanisms to promote anti-corruption policies and programmes, includinginformation, resources and tools for raisingemployee awareness.
The indicator includes a description of compliancemechanisms for:● reporting suspected violations, e.g. through a
company hotline (see also SE18 referring tonon-retaliation against ‘whistle-blowing’),supervisory reviews, and employee and third-party tip-offs; and
● detecting, investigating and preventing briberyand corruption, e.g. through internal controlsand audits.
At a supplemental reporting level, companiesmay report on the scope and content of anti-bribery and anti-corruption training programmesoffered for employees, including the relevanceand applicability to the employees’ specific work.Reporters can provide a description of thetraining plans and expectations for thepercentage of employees trained.
Reporting basis
The indicator is qualitative and reportable at aglobal level.
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Indicator:SE11: Preventing corruption
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Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe the company’s policy against bribery andcorruption.
● Describe employee awareness programmes. ● Describe internal mechanisms for reporting and
following up suspected violations.
● Describe the scope, content andtracking of anti-corruption trainingprogrammes provided.
● Description of risks associated with bribery and corruption which are relevant to companyoperations.
● Participation and level of involvement in voluntary initiatives or international conventions.● Disciplinary measures as a result of non-compliance.
Reporting elements
Description
Describe anti-corruption policies and proceduresapplicable to business partners, includingsuppliers and contractors.
Purpose
This indicator demonstrates a company’simplementation of policies and commitments toaddress the risk of bribery and corruptioninvolving its business partners, includingsuppliers, contractors and other intermediaries,particularly those representing a company beforegovernment officials.
Scope
Describe the company’s procurement andcontracting approach related to preventingbribery or corruption by its business partners,including suppliers and contractors. This mayinclude descriptions of anti-corruption policiesand due diligence procedures applicable tobusiness partners including:
● communication, including contractual clauses,and actions taken to encourage businesspartners, including suppliers and contractors,to implement anti-corruption programmes; and
● processes to monitor compliance with anti-corruption policies and/or compliance withprovisions set forth in contracts.
At a supplemental reporting level, companiesmay estimate the expected percentage ofsignificant contracts that contain specific languageintended to prevent corruption. A company wouldbe expected to define ‘significant’ based on, forexample, the size of the contract or other criteriaset out by the reporting company.
Reporting basis
The indicator is primarily qualitative andreportable at a global level, and may besupported by quantitative data and local casestudies.
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Indicator:SE12: Preventing corruption involving business partners
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Social and economic indicators Business ethics and transparency SE12: Preventing corruption involving business partners
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of anti-corruption policies and duediligence procedures applicable to businesspartners, including suppliers and contractors.
● Percentage of significant contracts thatcontain specific language intended toprevent corruption.
● Local case studies or examples to illustrate the implementation of policies, communication and actions. ● Disciplinary measures as a result of non-compliance.
Reporting elements
Description
Describe policies, initiatives or advocacyprogrammes for the promotion of revenuetransparency.
Purpose
Oil and gas companies contribute fiscal revenuestreams to host governments around the world.This indicator encourages companies to describetheir efforts to improve transparency of paymentsto host governments.
Scope
The reporting company should describe itspolicies, initiatives or programmes for thepromotion and achievement of transparency of oiland gas industry tax, royalty and other materialpayments to host governments.
The company should indicate participation intransparency initiatives, such as the Extractive
Industries Transparency Initiative (EITI), or itsadoption of other standards or practices on thetransparency of payments. This can be reportedat a global, regional, national or local level,consistent with contract confidentialityrequirements. Companies should list those EITI-implementing countries where upstream companyoperations are taking place, and any relevant in-country activities supported by the company.
At a supplemental reporting level, the companymay provide information on additionaltransparency efforts, split by country or region.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by country-level information. Reporters should focus primarilyon countries where revenue transparency issuesmay be of particular relevance to the businessand its sustainability objectives, or of particularinterest to stakeholders.
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Indicator:SE13: Transparency of payments to host governments
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Social and economic indicators Business ethics and transparency SE13: Transparency of payments to host governments
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of policies, initiatives or programmeson revenue transparency.
● List of relevant EITI-implementing countries.
● Information on further transparency efforts.
● Links/references to EITI reports, where relevant.● In certain contexts, such as illustrative case studies, companies may include specific information on their
transparency efforts with key governments. ● Where relevant, companies may wish to report payments on a disaggregated basis such as taxes paid,
royalties paid and bonuses (to governments that permit or require public disclosure).
Reporting elements
References
1. EITI (Extractive Industries Transparency Initiative), including the EITI Business Guide. www.eiti.org
Description
Describe the company’s approach to managingpublic advocacy, lobbying and politicalcontributions.
Purpose
This indicator demonstrates how a reportingcompany contributes to public policy debates andlegislative development, including policiescovering transparency, political engagement andfinancial contributions. It shows how a companyis working to maintain stakeholder trust regardingthe nature of its potential influence.
Scope
The reporting company should describe keyelements of its advocacy and lobbying activities.This may include:● the company’s overall approach to the
reporting of such activities;● descriptions of priority public policy issues the
company is advocating; and● quantitative indications of the amount of
money paid for public advocacy and lobbyingpurposes.
At a supplemental reporting level, the companycan explain how it reports on politicalcontributions. The company can also report on theamount of money paid to:● candidates, politicians and political parties;
and● individuals, organizations and institutions
whose prime function is to fund political partiesor their candidates.
Reporting basis
The indicator is primarily qualitative andreportable at a global level, and may besupported by quantitative data or country levelinformation. Since definitions and legislationrelated to lobbying and political contributionsvary between countries, it is helpful to explainwhich definitions or standards are applied inmanaging a company’s contributions.
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Indicator:SE14: Public advocacy and lobbying
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Social and economic indicators Business ethics and transparency SE14: Public advocacy and lobbying
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe the key elements of the company’sadvocacy and lobbying activities.
● Describe the company’s approach to thereporting of political contributions.
● Provide quantitative indications of the amountof money spent on political contributions.
● Provide examples to illustrate the implementation of the company’s approach in specific countries or onparticular issues.
Reporting elements
Social and economic indicators Labour practices
The workforce is a key stakeholder group andunderpins the success of a company. As withother stakeholders, engagement is a key tool toensure the company culture is positive, i.e.motivation is strong and workers are satisfied withtheir treatment, remuneration and conditions. It isessential that systems are in place to bringforward grievances without fear of retaliation.Fair and equitable treatment of workers is a basicexpectation of society that needs to beapproached systematically and underpinned withclear and robust policies and procedures.Indicators in this section describe characteristicsregarding recognition of the value of human
capital by provision of equal opportunities tocurrent or prospective workers through promotionof diversity and inclusion. It includes investmentthrough activities like training and development,in a manner consistent with company policy andcultural expectations.
The four indicators recognize the need forinclusion of employees as well as contractors andothers who form the workforce of a company.When discussing the workforce, particularly inquantitative terms, companies should clarify theextent to which each indicator includesemployees, contractors and others.
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Description
Describe policy and/or procedures promotingdiversity and inclusion.
Purpose
This indicator demonstrates the effectiveness of thereporting company’s policies on workforcediversity and inclusion (e.g. in relation to gender,ethnicity and disability).
Scope
The reporting company should describe itspolicies, programmes and/or procedures toaddress workforce diversity and inclusion at aglobal level, illustrated by examples ofimplementation at national levels. Non-discrimination aspects are treated separatelyunder SE8, Human rights due diligence.
At a supplemental reporting level, the companycan use local or national case studies todemonstrate how its policies and procedures areimplemented in practice. Implementationoutcomes can be evidenced through a discussion
on the composition of the workforce, particularlyat management level, or by providing quantitativedata for relevant diversity categories, such asgender.
Reporting basis
The indicator is qualitative and reportable at aglobal level, and may be supported by workforcedata and local case studies. If reported,quantitative data should be consolidated withinthe company’s reporting boundary using theworkforce approach (Appendix A).
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Indicator:SE15: Workforce diversity and inclusion
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Social and economic indicators Labour practices SE15: Workforce diversity and inclusion
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of the reporting company’spolicies, programmes and/orprocedures to promote workforcediversity and inclusion.
● Case study material to illustrate local implementationof policies, procedures and programmes.
● Discuss workforce composition particularly withreference to management positions.
● Workforce composition data for gender and/orother diversity categories.
● Provide information on other inclusion parameters such as equal pay for equal work.
Reporting elements
Description
Describe policies, programmes and/orprocedures on engagement and workforcesatisfaction.
Purpose
Worker satisfaction promotes organizationalefficiency, encourages a conscientious culture andcan affect external perception of the company.This indicator demonstrates the reportingcompany’s approach to engaging its workers todetermine their satisfaction with the company’semployment practices, general workingconditions, company culture and compliance withrights of workers.
Scope
The reporting company should describe itssystematic approach to worker engagement anddialogue. Companies can include an explanationof how it defines and measures ‘satisfaction’ andhow significant concerns or issues (e.g.
confidentiality, feedback, access to informationand survey results) raised through dialogue aretaken into account. The indicator can be reportedat a global level, with examples included todemonstrate workers’ freedom of speech anddialogue with management at national or locallevels. For the purpose of this Guidance,‘engagement’ includes a wide range of opinionbarometers, e.g. satisfaction surveys, employees’representation systems, dialogues, etc.
At a supplemental reporting level, the companycan describe dialogues with members of theworkforce, including unions, and may provideexamples or case study material to illustrateoutcomes including specific issues or themesraised and addressed.
Reporting basis
The indicator is qualitative and reportable at aglobal level. When discussing the workforce,companies should clarify the extent thatemployees, contractors and others are included.
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Indicator:SE16: Workforce engagement
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Social and economic indicators Labour practices SE16: Workforce engagement
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Description of workforce engagement such asapproach, frequency, coverage within the company,communication of the results, action plans.
● Explanation of the reporting company’s approachto handling worker concerns and issues.
● Description of formal dialogueswith workers.
● Discussion of significant issues, challenges and outcomes, arising from workforce surveys or otherengagements.
Reporting elements
Description
Describe policies and procedures for providingworkforce training and developmentopportunities.
Purpose
The development of workers is a key benefit thatthe company can offer to society in areas inwhich it operates, and is an important element ofthe company’s ability to attract and retain talent.Training and development can be part of acompany’s programme to ensure diversity andinclusion, and to encourage participation at alllevels. This indicator applies to activities thecompany engages in to improve its humancapital, through training and development toenhance competence, job skills, efficiency,knowledge, mobility and experience for meetingjob requirements and career goals.
Scope
The reporting company should describe itsprogrammes and approach related to trainingand development.
At a supplemental reporting level, the companycan provide evidence of its approach byquantifying the scale and extent of trainingprogrammes using measures such as: ● average hours of training per year per
employee and by category of worker;● average training investment per year; and ● percentage of workers receiving training in the
reporting period.
Supplemental reporting can include case studieson how the company’s approach has been locallyimplemented, and to illustrate progress, typicallyat the national level. Case study examples mayinclude the provision of international workexperience and the development of internationalemployees, support to the continued developmentof workers and managing career endings.
Reporting basis
The indicator is primarily qualitative andreportable at a global level, and may besupported by workforce data and local casestudies. If reported, quantitative data should beconsolidated within the company’s reportingboundary using the workforce approach, andbroken down by region or country (Appendix A).
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Indicator:SE17: Workforce training and development
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Social and economic indicators Labour practices SE17: Workforce training and development
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe the key elements of thecompany’s approach to trainingand development.
● Provide quantitative measures to illustrate theimplementation of training and development programmes.
● Case study material to demonstrate implementation andprogress.
None
Reporting elements
Description
Describe non-retaliation policy and confidentialworkforce grievance system.
Purpose
Non-retaliation and grievance systems promotefairness and respect for the dignity of workersand effective engagement between managementand workforce regarding worker concerns. Thisindicator applies to the company’s activities toprotect its workers’ ability to raise theirgrievances about workplace issues, and/or toidentify non-compliance and ethical incidentswithout fear of reprisal.
Scope
Issues covered by a grievance or non-compliancesystem could include human rights, ethics,environmental, safety and health-related issues,labour/employment issues, and ‘whistle-blowing’.The reporting company should describe its
policies, systems and mechanisms to address non-retaliation and grievance, including non-retaliation against ‘whistle-blowers’.
At a supplemental reporting level, the companycan demonstrate the accessibility and use of anyemployee workforce grievance systems within thecompany, by providing quantitative data such asthe approximate proportion of workers coveredby the system or the number of issues raisedthrough the system. Case studies can show howthe systems are communicated and promoted,and steps taken to build workforce confidence.
Reporting basis
The indicator is primarily qualitative andreportable at a global level, and may besupported by quantitative data and local casestudies. If reported, quantitative data should beconsolidated within the company’s reportingboundary using the workforce approach(Appendix A).
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Indicator:SE18: Non-retaliation and grievance system
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Social and economic indicators Labour practices SE18: Non-retaliation and grievance system
Common reporting elements
Other reporting elements
Supplemental reporting elements
● Describe policies, approach andsystems to address non-retaliationand grievances.
● Provide quantitative data to illustrate use of systems withinthe company.
● Case study material to describe generation of workforceconfidence in the systems, including promotion of use.
● Describe assurance of non-retaliation and grievance systems for short-term or contract workers, ifrelevant to the company’s operations.
Reporting elements
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Appendix A:
Detailed guidanceon developing areporting boundary
As noted in Section 3, detailed guidance is providedhere to encourage companies to set a clear, consistentreporting boundary. The guidance below is based onthree basic steps to determine which parts of thecompany’s organization will provide data, and how thisdata will be consolidated for each selected indicator:
1. Define the reporting boundary based on how thecompany is organized, including a list of everyreporting unit within the company from which datawill be requested related to its assets, people,processes or activities.
2. For each indicator, determine whether anoperational, equity share, workforce or corporateapproach will be applied to consolidate data withinthe reporting boundary.
3. For each indicator, collect data at the local, nationalor global level based on the scope of the indicatorand the applicable reporting elements.
The description of the reporting boundary process isdeliberately generic and aims to help any company todevelop its sustainability reporting. A company willnormally develop its reporting boundary to reflect itsown specific system and organizational nomenclature,and to ensure internal clarity on reportingrequirements. In addition, more detailed industryguidance may be available and referenced for specificindicators, particularly if the intent is to use the data forother purposes, including comparisons within orbetween companies, or to consolidate sector data.
Step 1: Define the reporting boundaryfor the company
The starting point for setting the reporting boundary isto identify and list all of the reporting units that arepart of the company for the purposes of sustainabilityreporting. Reporting units should be selected torepresent the smallest practical building blocks
reflecting the internal management of the company, andto allow data to be reported at local, country, region orglobal levels, as appropriate. A reporting unit can beall or part of a subsidiary company, joint venture,investment, facility, plant, office or business location,depending on what works best for the company giventhe way in which it is organized and managed.
Within the oil and gas industry, reporting units aregenerally grouped by types of upstream anddownstream activities, such as exploration, production,drilling, refining, chemical manufacturing and marketing.A company’s reporting units manage assets that providebenefits to stakeholders and have intrinsic financial valueto the company, but also have associated risks ofenvironmental, social or economic impact. Assets maybe operated and/or owned by the reporting company.A company will already be organized into groups ofactivities and assets for financial accounting and thisprovides a useful starting point to define the list ofreporting units for sustainability reporting.
In the oil and gas industry, ensuring that thecompany’s reporting boundary is correctly described interms of reporting units can be complex because twoor more companies are often commercially involved inan asset, such as in a joint venture, and work togetherunder a variety of legal forms. In order to facilitateconsolidation of data (Step 2), typically, each reportingunit:● represents a discrete piece of business that is
unlikely to be split during internal restructuring orportfolio change (acquisition or divestments);
● manages assets operated by a single company (i.e.the operator of the reporting unit’s assets is eitherthe reporting company itself or another company, sothat there is not a mix of different companies’operating assets within the reporting unit);
● manages assets which have the same reportingcompany ownership (i.e. try to avoid creatingreporting units that comprise assets with differentpercentage equity share); and
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● covers a narrow range of related business activitieslocated within one country.
The manager for the reporting unit is generallyresponsible for providing complete and accurateindicator data as appropriate and relevant to thereporting unit’s activities and assets. It is good practiceto check that the list of reporting units is sufficientlyinclusive to ensure that the consolidated data willadequately address the material issues to be reported.This helps to ensure that the sustainability reportprovides a complete picture of performance (seeSection 2, General Reporting Principle onCompleteness). For example, this check could confirmthat the reporting units collectively represent thecompany’s most significant emissions, employee andcontractor numbers, supply-chain expenditure, orcustomer base.
Step 2: Data consolidation within thereporting boundary
The indicators in the Guidance are generally intendedto provide consolidated data which is representative ofthe benefits and impacts of the company as a whole.There are a number of approaches to consolidating thedata within the reporting boundary depending on thepurpose and scope of each indicator. Four approachesare described which are applicable for this Guidance.
The application of the four consolidation approachescan be illustrated by considering a company thatdecides to collect the following data from eachreporting unit in its reporting boundary:a) Direct GHG emissions (E1) data from significant
stationary and mobile sources are collected andthen consolidated based on all emissions from assetsoperated by the reporting company, to demonstrateits management performance to reduce emissions—an example of the operational approach.
b) Direct GHG emissions (E1) data from significantstationary and mobile sources are collected andthen consolidated in proportion to the reportingcompany’s percentage share of emissions from itspartly or wholly owned assets (both operated and
non-operated), because the company wishes toprovide information on the significance of itsemissions in a manner more aligned with itsfinancial reporting—an example of the equity shareapproach.
c) Data on numbers of injuries, illnesses and hoursworked (HS3) are collected and consolidated foreach reporting unit’s employees and contractorsbecause the company recognizes its responsibility tomanage occupational safety and health risks—anexample of the workforce approach.
d) The company provides a description of thecompany’s corporate policies and practices for Localcontent (SE5) supported by case studies collectedfrom reporting units to illustrate how it appliesconsistent policies in host countries where itoperates—an example of the corporate approach.
Table 5 (page 121) has been provided to suggest likelydata consolidation approaches for each indicator in theGuidance. It should be noted that more than oneapproach may be applicable for any indicatordepending on the reporting elements selected.
When normalized quantities are calculated (seeSection 3), for example when reporting injury or illnessrates, or reporting emissions per unit production, it isimportant to ensure that the reporting boundary andconsolidation approach is consistent for both theindicator data and the normalization factor.
In some cases, particularly when applying thecorporate approach, a data consolidation step is notrequired. For example, if the indicator informationneeded was, ‘Describe policies, programmes and/orprocedures related to security and human rights’(SE10), there may be no need to consolidatereporting unit data as the company may have astandardized policy across the entire organization.However, a company may have an internal process tocheck policy implementation within its reporting unitsand may choose to apply the operational approachto consolidate the verification data within thereporting boundary.
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Four approaches for consolidating data within the reporting boundary
Operational approach: The most common method,especially for environmental data, is the operationalapproach (sometimes referred to as operationalcontrol), which consolidates data about the activities ofassets managed by a reporting unit. This approachreflects legal and contractual requirements, as well asinternal policies, to manage potential health, safety,environment and social impacts, and benefits. Dataare collected from each reporting unit about assetsoperated by the reporting company, including thoseassets partly owned by other companies (i.e. anoperated joint-venture). Conversely this approachexcludes data from assets which are partly owned bythe reporting unit but operated by another company(i.e. a non-operated joint venture). The operatedapproach is thus generally defined to collect andconsolidate all data or information from assets whichmeet either of the following criteria:
• the asset is operated by the company, whether foritself, or under a contractual obligation to otherowners or participants in the asset (for example, ina joint venture or other such commercialarrangement); or
• the asset is operated by a joint venture (orequivalent commercial arrangement), in respect ofwhich the company has the ability to determinemanagement and board level operational decisionsof the joint venture.
Given the complexity of the industry, sometimesuncertainty occurs at the detailed level over whichphysical assets should be included or excluded as‘operated’ when consolidating data. One area whichfrequently causes dilemmas involves mobile assets,such as vehicles or ships. Such assets are clearlyincluded in the consolidation when owned andoperated by the reporting unit, but often such assetsmay be owned by others and leased or chartered tothe reporting unit. In such cases, the followingguidance may be useful:
• Vehicles, aircraft or rail rolling stock not owned bythe company but contractually dedicated forexclusive business use by the reporting unit aregenerally included as operated assets for reporting.(This excludes ‘spot’ charters that are available forregular business use by other parties.)
• Many forms of contractual mechanisms exist formarine vessels, but a useful criterion for inclusion asoperated assets is when the reporting unit holds theInternational Safety Management Code Documentof Compliance (DOC). (This would typically excludetime chartered vessels, spot chartered vessels, orvessels that are owned but not managed by thereporting unit and where the reporting unit wouldnot hold the Document of Compliance.)
Alternative criteria to the above may apply forconsolidation of GHG emission or other data if acompany is reporting to an external regulated orvoluntary scheme.
The operational approach for consolidating datawithin the reporting boundary helps describe acompany’s performance in addressing sustainabilityissues through application of its HSE integratedmanagement system, which generally has anequivalent boundary applied to operated assets andactivities. When applying the operated approach, it isimportant that 100% of the data from the operatedassets is included. Thus, even when an operated assetis not wholly owned, all data collected by eachreporting unit should represent 100% of the impact orbenefit of its operated assets because the reporting unithas sole responsibility for management of these assets.The reported data should not be reduced in proportionto a reporting company’s share of the activity (i.e.percentage ownership).
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Equity share approach: This approach is based onasset ownership (or share of financial benefits) and inthis Guidance is primarily associated withconsolidating GHG emission data (see E1) collectedfrom reporting units. The approach is generallyapplied by consolidating data from all assets owned,or partly owned, by the reporting company inproportion to its percentage share of equity in (orbenefits from) the assets. In contrast to the operationalapproach, this means data are consolidated fromassets partially owned, but not operated by, thereporting company, as well as from operated assetsthat are wholly or partially owned—thus, irrespectiveof who the operator is, data are consolidated but onlyin proportion to the reporting company’s ownershipof each asset. The equity share approach is thereforealigned closely with financial reporting and isintended to provide a more complete picture ofpotential responsibilities. More detail is provided onthis approach in the companion IPIECA/API/OGPdocument Petroleum Industry Guidelines forReporting Greenhouse Gas Emissions, which alsoprovides information on an alternative but similarapproach known as the Financial Control Approach.
Workforce approach: This approach aims toconsolidate data related to activities that impact orbenefit employees of the reporting unit’s operatedassets. Depending on the indicator scope, theapproach may also be used to consolidate datarelated to contractors whose work is managed by thereporting unit, or third parties impacted by theactivities. The data are generally limited tooccupational (work-related) activities that take place inthe work environment and, in this regard, theworkforce approach builds on the operationalapproach but is focused on management of peoplerather than assets. The work environment may includenot only workplaces within a physical asset, such asproduction plant or offices, but any other places where
work is undertaken by the reporting unit, such as roadvehicles, aircraft, ships, survey locations, communityproperty, supplier depots or customer premises. TheScope sections of indicators in the Guidance may alsodefine specific activities of employees or contractorsthat are excluded, such as commuting from home towork, or voluntary participation in fitness programmes.This approach is commonly used for indicators thataim to measure actions, events or incidents resulting inactual or potential harm to people caused by theactivities of operated assets, and may also be appliedto other workforce measures, such as training.
Corporate approach: Processes, such asimplementation of policies, procedures, programmes,practices or systems, may be applied consistentlyacross all of a reporting unit’s assets or activities, andalso across groups of reporting units up to andincluding the corporate level of a company. Suchprocesses can apply to functional activities such asmarketing, product stewardship, research anddevelopment, lobbying, staff hiring practices, or socialinvestment. These activities may be carried out at alocal, national, regional or international level, often inpartnership with others. The corporate approach,which is commonly applied for social and economicindicators, is used to consolidate data or informationabout processes typically generated centrally at thereporting unit level or above, including the corporatelevel. The corporate approach may be supported bycase study or other local information to demonstrateprocess implementation at the asset level.
Step 3: Collect data within the indicatorscope
It is important to distinguish the company’s activitiesand assets managed by its reporting units thatconstitute the company’s reporting boundary, from theindicator scope. The ‘scope’ of each indicator in theGuidance helps limit the applicability of reportingelements to ensure that collected data are relevant andfocused on how the company has managed an issuesustainably. The scope, supported by definitions ofterms, provides guidance on the extent and limitationsof the indicator to reflect potential impacts of thecompany’s activities. The indicator scope aims toprovide specificity, applicability, consistency,comparability and relevance for each indicator, and itis therefore not necessary to detail the people, part ofthe environment or ‘value-chain’ included in acompany’s overall reporting boundary (beyond itsactivities, assets and workforce).
Depending on the materiality of an issue and the extentof any impact, a company needs to ensure that acomplete set of relevant data is collected for eachselected indicator. Relevance and completeness will varyfor different issues and, therefore, each Scope sectioncontains specific guidance for the respective indicator.Various options to report relevant data or information forthe indicator are then provided as reporting elements.
The indicator scope includes potential impacts, orbenefits, to parties not directly managed by thecompany. For example the scope of indicators may beinclusive of contractors or other suppliers, customers,local communities or governments. Examples follow onhow indicators provide options to increase the scope toreport on impacts or benefits from assets and activitiesbeyond those related to a reporting company’s directlymanaged operations and employees:● The scope of the GHG emissions (E1) indicator
provides the option for a company to report‘indirect’ emission data related to power supplied bygenerating plants owned or operated by others, aswell as reporting their own ‘direct’ emissions fromcombustion of fossil fuel within the reportingcompany’s owned or operated assets.
● As well as an indicator to report on how a companymight address Human rights due diligence (SE8), aseparate indicator provides scope to report onHuman rights and suppliers (SE9). Similarly, anotherindicator addresses Local procurement and supplierdevelopment (SE7).
● The health and safety indicator on Occupationalinjury and illness incidents (HS3) applies tocontractors as well as employees, while the Productstewardship (HS4) indicator includes scope toaddress how a company communicates product risksto customers.
Reporting beyond the defined boundary
A company may choose to extend its collection andconsolidation of data beyond its defined reportingboundary. This may apply only to certain indicators,where an issue is particularly material. This couldinclude, for example:● Large joint ventures where the company is not the
operator but has a substantial equity share. WhileGHG emissions (E1) suggests that data can beconsolidated using both equity share andoperational approaches, the company may wish tofurther describe a specific joint venture’sperformance related to other environmental, safetyor social responsibility issues, supported by anyavailable data from the joint venture.
● Some contracted activities, such as road transport,construction projects or shipping, may be partiallyexcluded from the consolidated data because certainassets are non-operated or the activities are outsidethe indicator scope. The company may wish toexpand its description of risks or incidents, or otherpotentially significant impacts, and discuss mitigationmeasures, supported by any available data.
In such cases, companies may wish to include relevantdata in their report, acknowledging the data source, asappropriate. However, such data should be reportedseparately so that base comparability is maintained forthe data consolidated within the company’s reportingboundary.
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Tabl
e 5
Typ
ical
use
of c
onso
lidat
ion
appr
oach
es w
ithin
the
repo
rting
bou
ndar
y
Clim
ate
chan
ge a
nd e
nerg
y
Issu
e ca
tego
ryIn
dica
tor
Ope
ratio
nal
Equi
ty s
hare
Wor
kfor
ceCo
rpor
ate
Dat
a co
nsol
idat
ion
appr
oach
Ecos
yste
m re
sour
ces
Loca
l env
ironm
enta
l im
pact
s
Wor
kfor
ce p
rote
ctio
n
Prod
uct h
ealth
, saf
ety
and
envi
ronm
enta
l ris
ksPr
oces
s sa
fety
and
ass
et in
tegr
ityC
omm
unity
and
soc
iety
Loca
l con
tent
Hum
an ri
ghts
Busi
ness
eth
ics
and
trans
pare
ncy
Labo
ur p
ract
ices
E1: G
reen
hous
e ga
s em
issi
ons
E2: E
nerg
y us
eE3
: Alte
rnat
ive
ener
gy s
ourc
esE4
: Fla
red
gas
E5: B
iodi
vers
ity a
nd e
cosy
stem
ser
vice
sE6
: Fre
sh w
ater
E7: O
ther
air
emis
sion
sE8
: Spi
lls to
the
envi
ronm
ent
E9: D
isch
arge
s to
wat
erE1
0: W
aste
HS1
: Wor
kfor
ce p
artic
ipat
ion
HS2
: Wor
kfor
ce h
ealth
HS3
: Occ
upat
iona
l inj
ury
and
illne
ss in
cide
nts
HS4
: Pro
duct
ste
war
dshi
pH
S5: P
roce
ss s
afet
ySE
1: L
ocal
com
mun
ity im
pact
s an
d en
gage
men
tSE
2: In
dige
nous
peo
ples
SE3:
Invo
lunt
ary
rese
ttlem
ent
SE4:
Soc
ial i
nves
tmen
tSE
5: L
ocal
con
tent
pra
ctic
esSE
6: L
ocal
hiri
ng p
ract
ices
SE7:
Loc
al p
rocu
rem
ent a
nd s
uppl
ier d
evel
opm
ent
SE8:
Hum
an ri
ghts
due
dilig
ence
SE9:
Hum
an ri
ghts
and
supp
liers
SE10
: Sec
urity
and
hum
an ri
ghts
SE11
: Pre
vent
ing
corr
uptio
nSE
12: P
reve
ntin
g co
rrup
tion
invo
lvin
g bu
sine
ss p
artn
ers
SE13
: Tra
nspa
renc
y of
pay
men
ts to
hos
t gov
ernm
ents
SE14
: Pub
lic a
dvoc
acy
and
lobb
ying
SE15
: Wor
kfor
ce d
iver
sity
and
incl
usio
nSE
16: W
orkf
orce
eng
agem
ent
SE17
: Wor
kfor
ce tr
aini
ng a
nd d
evel
opm
ent
SE18
: Non
-reta
liatio
n an
d gr
ieva
nce
syste
m
● ● ● ● ● ● ● ● ● ●
●
● ● ● ● ● ● ● ●
● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●
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OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Appendix B:
Glossary
Alternative energy: The energy derived from non-fossilfuel sources [E3].
Asset integrity: A systematic approach to ensuring thesafe containment of hazardous materials or energy byapplying good design, construction and operatingprinciples [HS5]. In this Guidance, this term is usedsynonymously with Process safety.
Barrel of oil equivalent (BOE): For liquids, one BOEequals one barrel of oil or condensate. For gases, oneBOE equals approximately 5,800 standard cubic feet(Scf) of gas.
Baseline: Dated information or data that establishes areference point against which performance trends canbe consistently assessed on a regular, usually annual,basis.
Benchmarking: The process of assessing relativeperformance against a group of peers.
Biodiversity: Biological diversity, or biodiversity, is verybroadly the variety of life on earth at the genetic, species,and ecosystem levels of biological organization [E5].
Biofuel: A fuel produced from organic matter producedby plants [E3].
Biomass: The total dry organic matter or stored energycontent of living organisms [E3].
Bribery: The payment of money or the provision ofanother benefit to someone in business or governmentto influence that person’s judgment or conduct in orderto gain commercial advantage [SE11].
Business activities: The types of oil and gas industryoperations or other commercial affairs of a company,such as Exploration, Production, Pipelines, Shipping,Refining, Marketing or Petrochemicals.
Business partners: Organization with which thereporting company has some form of commercialalliance or contract.
Carbon dioxide (CO2): A naturally occurringgreenhouse gas that is also emitted during combustionwhen burning fossil fuels and biomass [E1].
Child labour: The use of children as workers below theminimum age at which they can enter into differentkinds of work.
Climate change: Statistical variation in the distributionof weather which, at a global level, has beenassociated with increased levels of atmospheric CO2
produced largely by the increasing combustion of fossilfuels from the 20th century onwards [E1, E2].
CO2 equivalent: The mass of CO2 multiplied by itsGlobal warming potential (GWP) [E1].
Cogeneration/combined heat and power (CHP): Afacility producing electricity and steam or heatsimultaneously using the same fuel supply to achieveenergy efficiency and lower emissions [E2].
Consolidation: The process of gathering andaggregating information (usually quantitative data)from a company’s business activities within itsReporting boundary to generate Indicators of overallcompany performance [Appendix A].
Communities: A group of people who share a commonsense of identity and interact with one another on asustained basis [SE1].
Containment: See Primary containment and Secondarycontainment.
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Appendix B:
Glossary
Appen
dix
B:
Glo
ssary
Note: the references in square parentheses refer to a Section, Indicator or Appendix in the Guidance where furtherdefinitional information is provided.
Continuous improvement: A cyclic process applied bymanagement for planning, implementing, measuringand reviewing the company’s activities in order toachieve better performance.
Contractor: In the context of the Workforce, acontractor refers to a person not employed directly bythe reporting company who performs services undercontract for the company, especially at one of itsworksites.
Corruption: Any dishonest or illegal practice that resultsin loss of business integrity [SE11]. (See also Bribery.)
Cuttings: In drilling, pieces of drilled rocks brought tothe surface by the returning drilling mud stream [E9,E10]
Direct energy: The amount of Primary energy used bya facility or its equipment to generate power or heat[E2].
Direct GHG emissions: GHG emitted from sources atcompany facilities [E1].
Discharges: In this Guidance, refers to releases ofliquids (products, by-products or waste streams) intowater or land [E8, E9].
Discrimination: A prejudicial outlook, action ortreatment towards a person or a group of people.Discrimination may be based on race, colour, sex,religion, political opinion, nationality, social origin,social status, indigenous status, disability, age [SE1,SE15].
Downstream: Operations involving the refining,processing, distribution, and marketing of productsderived from oil and gas, including service stations.
Drilling mud: The fluids used in drilling to controlpressure and serve as a lubricant [E9, E10].
Ecosystem: A dynamic complex of communities ofliving organisms and their non-living environmentinteracting as a functional unit [E5].
Ecosystem services: The benefits (direct and indirect)that people obtain from ecosystems [E5, E6]
Emissions: The release of gases, vapours, fumes, mist,and particulate matter into the atmosphere [E1, E4,E7].
Employee: A person legally contracted and paiddirectly by a company to undertake work associatedwith its Business activities.
Energy efficiency: The ratio of measured output toenergy input which describes efforts to use energy in aresponsible manner such that maximum benefit isachieved for the resource consumed [E2].
Energy intensity: Energy use divided by theappropriate normalization factor for a business activity,e.g. production volume, refinery throughput [E2].
Energy use: The total Primary energy used by a facilitycalculated as the sum of Direct energy and Importedenergy less any Exported energy [E2].
Environment: An external setting comprised of itsphysical, chemical, biological and social components.In this Guidance, the term ‘environment’ refersespecially to the natural environment, which broadlyincludes all non-anthropogenic living and non-livingentities, whether solid, liquid or gas, occurring naturallyon earth.
Environmental impact: The outcome of actions orevents on the natural environment; while impacts maybe beneficial, in this Guidance, the term refers toadverse, undesirable outcomes.
Environmental management system (EMS): A set ofprocesses and procedures applied by managers toassess and implement actions or programmes tomitigate environmental impacts from operations.
Equity share: The percentage of ownership oreconomic interest in an operation [E1, Appendix A]
Event: An unplanned or uncontrolled outcome of abusiness operation or activity that has, or could have,contributed to an injury, illness, or physical damage orenvironmental damage.
Exploration: The activities of a company to findnaturally occurring fossil fuels. (See also Upstream.)
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Appen
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B: G
lossa
ry
Exported energy: The Primary energy content of a fuelor other source required to produce power (in the formof electricity, heat or steam) that is exported from thefacility [E2].
Fatality: An occurrence of death resulting from anIncident [HS3].
Fatal accident rate: The aggregate number ofEmployee or Contractor fatalities that have occurredwithin the company’s Workforce during a stated periodof time, reported as a rate (frequency) per 100 millionhours worked during the same time period [HS3].
Fatal incident rate: The aggregate number of Incidentsresulting in Employee or Contractor fatalities that haveoccurred during a stated period of time, reported as arate (frequency) per 100 million hours worked duringthe same time period [HS3].
First-tier supplier: An organization that supplies goodsand/or services directly to the company, i.e. without theuse of an intermediate organization [SE7].
Flared gas: Total mass (or volume) of hydrocarbondirected to operational flare systems, wherein thehydrocarbons are consumed through combustion [E4].
Flaring: The burning of gases in a thermal destructiondevice; includes flaring of associated gas from oilproduction [E4].
Freedom of association: The right of Employees to formand join groups for the promotion and defence of theiroccupational interests [SE8].
Fresh water: Naturally occurring above-ground andunderground non-brackish water. Typically used asdrinking water, potable water or in agriculture [E6].
Fresh water returned: The Fresh water discharged froma facility (directly or via a third party) into a freshwaterbody or aquifer [E6].
Fresh water withdrawn: The volume of Fresh waterremoved from all sources, including surface water,groundwater, harvested rainwater and municipal watersupply [E6].
Fresh water net consumption: The difference betweenFresh water withdrawn and Fresh water returned [E6].
Fugitive emissions: The mass of uncontrolled releasesof gas from pressurized process equipment, such asvalves, flanges, pump and compressor seals, and open-ended lines, as well as tanks where hydrocarbons areexposed to the atmosphere [E1].
GHG emissions from exported energy: The amount ofDirect GHG emissions related to production of power(in the form of electricity, heat or steam) that is suppliedto a third party [E1].
GHG intensity: GHG emissions divided by anappropriate output factor for a business activity such asoil and gas production or refinery throughput [E1].
Global warming: An overall increase in worldtemperatures which may be caused by additional heatbeing trapped by Greenhouse gases.
Global warming potential (GWP): A factor whichestimates the contribution to Global warming of a givenmass of a Greenhouse gas species, relative to the samemass of CO2 [E1].
Greenhouse gases (GHGs): Gases in the atmospherethat absorb and emit radiation within the thermalinfrared range and may consequently contribute toGlobal warming. For the purpose of these Guidelines,GHGs are the six gases (or families of gases) listed inthe Kyoto Protocol [E1].
Hazardous waste: Waste that is defined as hazardous,toxic, dangerous, listed, priority, special or some othersimilar term as defined by an appropriate country,regulatory agency or authority [E10].
Health impact assessment (HIA): A process to assesspotential effects of a project on the health of apopulation [HS2].
Health risk assessment (HRA): A process that aims toidentify health hazards, evaluate risks to health, anddetermine appropriate control and recovery measures[HS2].
Human rights: Basic standards of treatment to which allpeople are entitled, regardless of nationality, gender,race, economic status or religion [SE8, SE9, SE10].
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Appen
dix
B:
Glo
ssary
Imported energy: The amount of Primary energy toproduce power which has been purchased and used bythe company, in the form of electricity, heat or steam[E2].
Incident: An unplanned or uncontrolled Event or chainof Events that has resulted in Recordable injury, illness,or physical or environmental damage. [HS3].
Indicator: Information or data which provides evidenceof a company’s performance in addressingsustainability issues which are material for reporting.
Indigenous communities, peoples and nations: Socialgroups, with unique characteristics and identities, thathistorically existed before the development of thedominant societal group in a country or territory [SE2].
Indirect GHG emissions for imported energy: GHGemissions that occur at the point of generating powerthat is supplied by a third party in the form ofelectricity, heat or steam for use in the reportingcompany’s facilities [E1].
Issues: Identified sustainability aspects, benefits orimpacts of a company’s activities.
Local: The use of this term may differ in a reportdepending on the issue being described or indicatorused, and additional context is usually required forclarity. ‘Local’ can be used to narrowly referenceneighbouring communities or the natural environmentadjacent to company activities, or to provide widerreference to national or regional geographies.
Loss of primary containment (LOPC): An unplanned oruncontrolled release of any material from Primarycontainment, including non-toxic and non-flammablematerials (e.g. steam, hot condensate, nitrogen,compressed CO2 or compressed air).
Lost time illness: An Occupational illness that resultedin an Employee or Contractor fatality or Lost workday[HS3].
Lost time illness rate: The aggregate number ofEmployee or Contractor Lost time illnesses that haveoccurred within the company’s Workforce during astated period of time, reported as a rate (frequency)per million hours worked during the same time period.
Lost time injury: An Occupational injury that resultedin an Employee or Contractor fatality or Lost workday[HS3].
Lost time injury rate: The aggregate number ofEmployee or Contractor Lost time injuries that haveoccurred within the company’s Workforce during astated period of time, reported as a rate (frequency)per million hours worked during the same time period[HS3].
Lost workday: A severity classification for anOccupational injury or an Occupational illness incidentthat resulted in a person being unfit for work on anyday after the occurrence of the Incident, irrespective ofwhether work was scheduled for that day [HS3].
Marketing: The facilities and process steps to supplyproducts from refining to customers, includingdistribution terminals, transportation and retail.
Materiality: A process to determine the Issues relevantto the company and its stakeholders for inclusion in itsSustainability reporting, including the relativeimportance and prominence of each issue.
Methane (CH4): A hydrocarbon compound that is theprimary component of natural gas and designated agreenhouse gas [E1, E7].
Near miss: An unplanned on uncontrolled Event orchain of Events that has not resulted in recordableinjury, illness, or physical damage or environmentaldamage but had the potential to do so in othercircumstances.
Nitrogen oxides (NOx): A general term for nitrogenoxide gases. These are produced by combustion andcontribute to the formation of smog and acid rain [E7].
Non-financial reporting: A term synonymous withSustainability reporting. The term ‘non-financial’ isused by some companies to distinguish these reportsfrom more traditional company financial reports.
Non-governmental organization (NGO): A non profitgroup organized outside of institutionalized politicalstructures to realize particular social objectives or serveparticular constituencies.
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Appen
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Non-hazardous waste: Waste, other than Hazardouswaste, resulting from company operations, includingprocess and oil field wastes disposed of, on site or offsite, as well as office, commercial or packaging relatedwastes [E10].
Normalization: The ratio of a quantitative indicatoroutput (e.g. emissions) to an aggregated measure ofanother output (e.g. oil and gas production or refinerythroughput) [Section 3].
Occupational illness: An Employee or Contractor healthcondition or disorder requiring medical treatment dueto a workplace Incident, typically involving multipleexposures to hazardous substances or to physicalagents. Examples include noise-induced hearing loss,respiratory disease, and contact dermatitis [HS3].
Occupational injury: Harm of an Employee orContractor resulting from a single instantaneousworkplace Incident that results in medical treatment(beyond simple first aid), work restrictions, days awayfrom work (lost time) or a Fatality [HS3].
Operating area: An area where business activities takeplace with potential to interact with the adjacentenvironment [E5].
Operation: A generic term used to denote any kind ofbusiness activity.
Particulate matter: A complex mixture of smallparticles or droplets such as salts, organic chemicals,metals and soil particles [E7].
Petrochemicals: Chemical products derived from oiland gas.
Pipelines: Construction and use of facilities to transportliquid or gaseous hydrocarbons over long distances inabove-ground, below-ground or underwater pipes.
Primary containment: The vessel, pipe, barrel,equipment or other barrier that is designed to keep amaterial within it [E8, HS5].
Primary energy: The energy content of a hydrocarbonfuel or other energy source used to produce power,usually in the form of electricity, heat or steam [E2].
Process safety: A systematic approach to ensuring thesafe containment of hazardous materials or energy byapplying good design, construction and operatingprinciples [HS5]. In this Guidance, this term is usedsynonymously with Asset integrity.
Process safety event: A Recordable Loss of primarycontainment.
Process safety event rate: The number of Processsafety events per 1,000,000 (1 million) work hours(production and drilling work hours only).
Produced water: Water that is brought to the surfaceduring operations which extract hydrocarbons from oiland gas reservoirs [E9].
Product: Any material of commercial value which isextracted, processed, refined, manufactured ortransported by an oil and gas company.
Product life cycle: The various stages of a Product’sexistence—from procuring the raw materials, tomanufacture, distribution and use of the product, tohow it is disposed of or recycled at the end of itsusefulness [HS4].
Product stewardship: The process of addressing andcommunicating health, safety and environmental risksassociated with oil and gas products [HS4].
Production: the activities of a company to extractnaturally occurring fossil fuel resources.
Recordable: A type of Event, Incident, injury, illness,release or other outcome which has been determined tomeet or exceed definitions, criteria or thresholds forinclusion and classification in reported data.
Recovered hydrocarbons: The amount of spilledhydrocarbons removed from the environment throughshort-term spill response activities. It does not includelonger-term remediation or oil which evaporates orburns [E8].
Refining: Operating plant and processes to convertextracted hydrocarbons (crude oil, condensates andnatural gas) into fuel, lubricants and other products formarketing to customers.
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Appen
dix
B:
Glo
ssary
Renewable energy: Primary energy sources that areconstantly replenished by natural processes includingsolar, hydro, geothermal and wind power, as well asbiomass [E2, E3].
Reporting: Disclosing relevant information and data tointernal and external stakeholders such asmanagement, Employees, governments, regulators,shareholders, the general public, local communities orspecific interest groups.
Reporting boundary: A defined list of organizationalunits based on a company’s entities, assets andBusiness activities from which information isConsolidated for reporting an Indicator [Appendix A].
Resettlement: Voluntary or involuntary relocation ofindividuals or communities due to land userequirements associated with industry operations [SE3].
Reused, recycled or recovered waste: Waste from anindustrial or commercial process that is not disposed of,but beneficially used again in the same or anotherprocess [E10].
Risk: The combination of likelihood (frequency) andseverity (consequence) of potential adverse impacts,from actions or events, on the environment or people.
Safety Data Sheet (SDS): Information provided onhazards, risks, handling, storage and emergencymeasures for users of a chemical product [HS4].
Secondary containment: An impermeable physicalbarrier specifically designed to prevent leakage ofmaterials into the environment that have breachedprimary containment [E8].
Shipping: Transport of oil or gas by ocean, sea or riverusing specifically designed vessels.
Spill to the environment: Any unintended release ofliquids or solids associated with current operation, fromPrimary containment or Secondary containment, intothe environment.
Stakeholders: People that affect, or are affected by,company activities or operations (e.g. customers,shareholders, management, Employees, Suppliers, localcommunities, advocacy groups and government).
Subcontractors: Secondary Contractors who arecontracted by a supplier (and not by the reportingcompany directly) to perform some or all of thesupplier’s contractual obligations to the reportingcompany.
Sulphur dioxide (SO2): An emission that resultsprimarily from the combustion of sulphur inhydrocarbons and contributes to acid rain and otherair quality problems [E7].
Supplier: A third-party organization paid by thecompany under contract to provide goods and/orservices.
Supply chain: Entire network of entities, directly orindirectly interlinked and/or interdependent in servingthe same consumer or customer with goods and/orservices.
Sustainability reporting: Defined, for this Guidance, asreporting on the range of environmental, health andsafety, social, and economic issues and impacts thatrelate to oil and gas company activities. Companiesmay use a variety of other terms for this type ofreporting, such as non-financial reporting, corporateresponsibility, corporate citizenship, or environmental,social and governance.
Total recordable illness rate: The aggregate number ofEmployee or Contractor Occupational illnesses that arerecordable and have occurred within the company’sWorkforce during a stated period of time, reported asa rate or frequency per million hours worked duringthe same time period [HS3].
Total recordable injury rate: The aggregate number ofEmployee or Contractor Occupational injuries that arerecordable and have occurred within the company’sworkforce during a stated period of time, reported as arate or frequency per million hours worked during thesame time period [HS3].
Upstream: Activities and/or operations involving theexploration, development, and production of oil andgas.
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Appen
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lossa
ry
Venting: The controlled release of gases in theatmosphere. The gases might be natural gas or otherhydrocarbon vapours, water vapour and other gases,such as carbon dioxide, separated in the processing ofoil or natural gas [E4].
Volatile organic compounds (VOCs): Organiccompounds, excluding methane, which vaporize in theatmosphere and may participate in photochemicalreactions [E7].
Waste: Material (solid or liquid) intended to bedisposed of, reused, recycled or recovered eitheron site or off site, that is the result of companyoperations [E10].
Waste disposal: Final placement or destruction, on siteor off site, of Waste under proper process andauthority with no intention to retrieve [E10].
Workforce: All people undertaking work activitiesmanaged by a company, which can include Employees,Contractors and others as specified in the company’sreport.
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Appen
dix
B:
Glo
ssary
131
OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Appendix C:
Summary of keychanges since 2005 andrelationship to GRI G3 Guidelines
This second edition of the Guidance incorporates anumber of improvements to achieve our objectives andrespond to suggestions from stakeholders, including ourexternal Stakeholder Panel. In summary, the keychanges since the first edition (2005) are: ● The front section of the Guidance has been rewritten
to include guidance on strategic context and keyprocess steps for preparing sustainability reports.
● Guidance on determining materiality of issues forreporting has been introduced together with briefdescriptions of the main sustainability issues for ourindustry.
● Greater definitional content has been provided foreach revised indicator, including new ‘ReportingElements’ that offer options for both new and maturereporters, as well as improve comparability.
● A number of environmental indicators have beenconsolidated and the social and economic sectionshave been merged.
● New indicators have been added to reflect changesin reporting practices since 2005, including onehealth and safety indicator on process safety, fivesocial and economic indicators, focusing on localcontent and suppliers/business partners, andbroadening the scope of the biodiversity indicator toinclude ecosystem services.
● Individual management system indicators have beenremoved in favour of integrated guidance(Section 2).
● The guidance on reporting boundaries is moreextensive.
Overall, the Guidance is longer because it containsmore options and depth of guidance for reporters, butthere are nine fewer indicators than in the first edition.
The terms ‘Core’ and ‘Additional’ were categories usedin the 2005 edition of the Guidance and are used inthe Global Reporting Initiative G3 SustainabilityReporting Guidelines (GRI G3 Guidelines). For this
edition of the Guidance, these terms have beendropped in favour of ‘reporting elements’, whichprovide greater flexibility and put more emphasis onthe materiality process to determine report content.
Relationship to the GRI G3 Guidelines
Both this edition of the Guidance, and the first edition,have drawn on the work of GRI whose cross-industryguideline documents are used by many businesses andother organizations, including oil and gas companies.As part of the process to develop this edition of theGuidance, ongoing dialogue, meetings, coordination ofwork programmes and sharing of draft materials haveoccurred through the members in common of theIPIECA Reporting Task Force and the GRI SectorSupplement Oil & Gas Working Group. While thisGuidance is designed as a ‘stand-alone’ reference tool,it differs from the GRI G3 Guidelines in that it provides:● flexibility to meet the reporting needs of a variety of
differing organizations in the petroleum industry,including multi-national majors, smaller internationalcompanies and also national oil companies;
● industry consensus on the most materialsustainability issues and the associated choice ofconsistent indicators and reporting elements;
● sharing of oil and gas industry-specific goodpractice including greater technical depth onquantitative performance tracking, particularly onenvironmental, health and safety issues, withpractical options for qualitative reporting, especiallyon economic and social issues; and
● recommendations that are aligned with other goodpractice and guidance documents published byIPIECA, API and OGP for their members.
It is equally recognized that, for common sustainabilityissues, there is partial alignment with some of thegeneric indicators in the GRI G3 Guidelines. The
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Appendix C:
Summary of key changes since 2005 and relationship tothe GRI G3 Guidelines
Appen
dix
C:
Sum
mary
of
key
changes
sin
ce 2
005
and r
elationsh
ip t
o G
RI
G3 G
uid
elin
es
G3 Guidelines also provide broader advice on certainaspects of reporting as a process, such as reportingprinciples. While some companies will find theGuidance to be sufficient for their sustainabilityreporting, others may use a combination of theGuidance and the GRI G3 Guidelines.
As part of the GRI’s ongoing development programmes,oil and gas companies, including members of IPIECA,API and OGP, have been engaged with stakeholders indeveloping an Oil and Gas Sector Supplement for theGRI G3 Guidelines. Further information on thisSupplement will be provided on the IPIECA website,when available.
Mapping the Guidance
Within this Appendix, Table 6 (overleaf) cross-references the 2010 indicators against the 2005indicators. This mapping aims to support users of theGuidance in the transition between the two editionsand to help companies who include an indicator indexin their sustainability reports. It should be noted that thefollowing indicators have not been carried forwardfrom the 2005 edition to the 2010 edition; instead,these indicators are largely covered by Steps 2 and 5of Section 2:● H&S–1: Health and Safety Management Systems● ENV–6: Environmental Management Systems● ECO–1: Tax Expenses● ECO–2: Dividends Paid Plus Share Repurchases● ECO–A2: Payroll and Benefits● ECO–3: Capital Expenditures● ECO–A3: Interest Paid
To help those companies who reference the Guidanceand the GRI G3 Guidelines, Table 6 also mapsindicators within the 2010 edition of the Guidance tocomparable indicators in the GRI G3 Guidelines. This
mapping is only approximate as the GRI G3 Guidelinesdiffer in structure, approach and specificity of contentcompared to the Guidance. For this reason, themapping seeks only to recognize indicators withsimilar overall intent or where parts of indicatorsreference comparable data. Indicators from theGRI G3 Guidelines have been highlighted in bold typewhere there is greater similarity to the Guidanceindicators. Mapping between the Guidance and GRI’sOil and Gas Sector Supplement is planned once theSupplement is available.
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Appen
dix
C: Su
mm
ary
of k
ey ch
anges sin
ce 2005
and rela
tionsh
ip to
GRI G
3 G
uid
elines
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Appen
dix
C:
Sum
mary
of
key
changes
sin
ce 2
005
and r
elationsh
ip t
o G
RI
G3 G
uid
elin
es
Tabl
e 6
Map
ping
the
2010
Gui
danc
e ag
ains
t the
200
5 G
uida
nce
and
GRI
G3
Gui
delin
es
Gui
danc
e In
dica
tors
200
5G
uida
nce
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cato
rs 2
010
GRI
G3
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delin
es In
dica
tors
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odes
in b
old
indi
cate
gre
ater
sim
ilarit
y)
Code
Nam
eCo
deN
ame
Code
Nam
e
ENV-
3
ENV-
5
ENV-
A8
ENV-
4
ENV-
A9
ENV-
A7
ENV-
A6
ENV-
1EN
V-A
1
ENV-
2EN
V-A
2
ENV-
A3
ENV-
A4
ENV-
A5
Tota
l dire
ct a
nd in
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ct g
reen
hous
e ga
s em
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ons
by w
eigh
t.O
ther
rele
vant
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rect
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ativ
es to
redu
ce g
reen
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e ga
s em
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ons
and
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ctio
ns a
chie
ved.
Dire
ct e
nerg
y co
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n by
prim
ary
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gy s
ourc
e.In
dire
ct e
nerg
y co
nsum
ptio
n by
prim
ary
sour
ce.
Ener
gy s
aved
due
to c
onse
rvat
ion
and
effic
ienc
y im
prov
emen
ts.In
itiat
ives
to re
duce
indi
rect
ene
rgy
cons
umpt
ion
and
redu
ctio
ns a
chie
ved.
Initi
ativ
es to
pro
vide
ene
rgy-
effic
ient
or r
enew
able
ene
rgy-
base
d pr
oduc
ts an
dse
rvic
es, a
nd re
duct
ions
in e
nerg
y re
quire
men
ts as
a re
sult
of th
ese
initi
ativ
es.
Tota
l dire
ct a
nd in
dire
ct g
reen
hous
e ga
s em
issi
ons
by w
eigh
t.
Loca
tion
and
size
of l
and
owne
d, le
ased
, man
aged
in, o
r adj
acen
t to,
pro
tect
edar
eas
and
area
s of
hig
h bi
odiv
ersi
ty v
alue
out
side
pro
tect
ed a
reas
.D
escr
iptio
n of
sign
ifica
nt im
pact
s of a
ctiv
ities
, pro
duct
s, a
nd se
rvic
es o
n bi
odiv
ersit
yin
pro
tect
ed a
reas
and
are
as o
f hig
h bi
odiv
ersi
ty v
alue
out
side
pro
tect
ed a
reas
.H
abita
ts pr
otec
ted
or re
store
d.St
rate
gies
, cur
rent
act
ions
and
futu
re p
lans
for m
anag
ing
impa
cts
on b
iodi
vers
ity.
Tota
l wat
er w
ithdr
awal
by
sour
ce.
Wat
er s
ourc
es s
igni
fican
tly a
ffect
ed b
y w
ithdr
awal
of w
ater
.Pe
rcen
tage
and
tota
l vol
ume
of w
ater
recy
cled
and
reus
ed.
Emis
sion
s of
ozo
ne-d
eple
ting
subs
tanc
es b
y w
eigh
t.N
Ox,
SO
x, a
nd o
ther
sig
nific
ant a
ir em
issi
ons
by ty
pe a
nd w
eigh
t.
Tota
l num
ber a
nd v
olum
e of
sig
nific
ant s
pills
.
Tota
l wat
er d
isch
arge
by
qual
ity a
nd d
estin
atio
n.
Tota
l was
te b
y ty
pe a
nd d
ispo
sal m
etho
d.
Envi
ronm
enta
l ind
icat
ors
Gre
enho
use
gas
emis
sion
s
Ener
gy u
se
New
and
rene
wab
le e
nerg
y re
sour
ces
Flar
ed a
nd v
ente
d ga
s
Biod
iver
sity
Fres
h w
ater
Oth
er o
pera
tiona
l air
emis
sion
s
Hyd
roca
rbon
spi
lls to
the
envi
ronm
ent
Oth
er s
pills
and
acc
iden
tal r
elea
ses
Con
trolle
d di
scha
rges
to w
ater
Oth
er e
fflue
nt d
isch
arge
s
Haz
ardo
us w
aste
Non
-haz
ardo
us w
aste
Recy
cled
, reu
sed
or re
clai
med
mat
eria
l
E1 E2 E3 E4 E5 E6 E7 E8 E9 E10
Gre
enho
use
gas
emis
sion
s
Ener
gy u
se
Alte
rnat
ive
ener
gy s
ourc
es
Flar
ed g
as
Biod
iver
sity
and
eco
syste
m s
ervi
ces
Fres
h w
ater
Oth
er a
ir em
issi
ons
Spill
s to
the
envi
ronm
ent
Dis
char
ges
to w
ater
Was
te
EN16
EN17
EN18
EN3
EN4
EN5
EN7
EN6
EN16
EN11
EN12
EN13
EN14
EN8
EN9
EN10
EN19
EN20
EN23
EN21
EN22
H&
S-2
H&
S-3
H&
S-4
Empl
oyee
par
ticip
atio
n
Wor
kfor
ce h
ealth
Occ
upat
iona
l inj
ury
and
illne
ss ra
tes
HS1
HS2
HS3
Wor
kfor
ce p
artic
ipat
ion
Wor
kfor
ce h
ealth
Occ
upat
iona
l inj
ury
and
illne
ss in
cide
nts
LA6
LA8
LA7
Perc
enta
ge o
f tot
al w
orkf
orce
repr
esen
ted
in fo
rmal
join
t man
agem
ent-w
orke
rhe
alth
and
saf
ety
com
mitt
ees
that
hel
p m
onito
r and
adv
ise o
n oc
cupa
tiona
l hea
lthan
d sa
fety
pro
gram
mes
.
Educ
atio
n, tr
aini
ng, c
ouns
ellin
g, p
reve
ntio
n, a
nd ri
sk-c
ontro
l pro
gram
mes
in p
lace
to a
ssis
t wor
kfor
ce m
embe
rs, t
heir
fam
ilies
or c
omm
unity
mem
bers
rega
rdin
gse
rious
dis
ease
s.
Rate
s of
inju
ry, o
ccup
atio
nal d
isea
ses,
lost
days
and
abs
ente
eism
, and
tota
lnu
mbe
r of w
ork-
rela
ted
fata
litie
s by
regi
on.
Hea
lth a
nd s
afet
y pe
rform
ance
indi
cato
rs
135
OIL AND GAS INDUSTRY GUIDANCE ON VOLUNTARY SUSTAINABILITY REPORTING
Appen
dix
C: Su
mm
ary
of k
ey ch
anges sin
ce 2005
and rela
tionsh
ip to
GRI G
3 G
uid
elines
H&
S-5
Prod
uct-r
elat
ed h
ealth
risk
sH
S4
HS5
Prod
uct s
tew
ards
hip
Proc
ess
safe
ty
PR1
PR2
PR3
PR4
PR6
Life-
cycl
e sta
ges
in w
hich
the
heal
th a
nd s
afet
y im
pact
s of
pro
duct
s ar
e as
sess
edfo
r im
prov
emen
t, an
d pe
rcen
tage
of s
igni
fican
t pro
duct
s an
d se
rvic
es c
ateg
orie
ssu
bjec
t to
such
pro
cedu
res.
Tota
l num
ber o
f inc
iden
ts of
non
-com
plia
nce
with
regu
latio
ns a
nd v
olun
tary
cod
esco
ncer
ning
hea
lth a
nd s
afet
y im
pact
s of
pro
duct
s an
d se
rvic
es b
y ty
pe o
f out
com
e.Ty
pe o
f pro
duct
and
ser
vice
info
rmat
ion
requ
ired
by p
roce
dure
s, a
nd p
erce
ntag
eof
sig
nific
ant p
rodu
cts
and
serv
ices
sub
ject
to s
uch
info
rmat
ion
requ
irem
ents.
Tota
l num
ber o
f inc
iden
ts of
non
-com
plia
nce
with
regu
latio
ns a
nd v
olun
tary
cod
esco
ncer
ning
pro
duct
and
ser
vice
info
rmat
ion
and
labe
lling
, by
type
of o
utco
me.
Prog
ram
mes
for a
dher
ence
to la
ws,
sta
ndar
ds a
nd v
olun
tary
cod
es re
late
d to
mar
ketin
g co
mm
unic
atio
ns, i
nclu
ding
adv
ertis
ing,
pro
mot
ion
and
spon
sors
hip.
No
equi
vale
nt in
dica
tor
SOC
-8
SOC
-A6
SOC
-A7
SOC
-A4
SOC
-A5
SOC
-A3
Com
mun
ity re
latio
nshi
ps
Indi
geno
us c
omm
uniti
es
Rese
ttlem
ent a
nd la
nd ri
ghts
Soci
al in
vestm
ent
Exte
rnal
cap
acity
bui
ldin
g
Loca
l em
ploy
men
t opp
ortu
nitie
s
SE1
SE2
SE3
SE4
SE5
SE6
SE7
Loca
l com
mun
ity im
pact
s an
d en
gage
men
t
Indi
geno
us p
eopl
es
Invo
lunt
ary
rese
ttlem
ent
Soci
al in
vestm
ent
Loca
l con
tent
pra
ctic
es
Loca
l hiri
ng p
ract
ices
Loca
l pro
cure
men
t and
sup
plie
rde
velo
pmen
t
SO1
SO1
SO1
EC1
EC8
SO1
EC6
EC7
SO1
EC7
EC9
EC6
Nat
ure,
scop
e, a
nd e
ffect
iven
ess o
f any
pro
gram
mes
and
pra
ctic
es th
at a
sses
s and
man
age
impa
cts o
f ope
ratio
ns o
n co
mm
unitie
s, in
cludi
ng e
nter
ing,
ope
ratin
g an
d ex
iting.
Nat
ure,
scop
e, a
nd e
ffect
iven
ess o
f any
pro
gram
mes
and
pra
ctic
es th
at a
sses
s and
man
age
impa
cts o
f ope
ratio
ns o
n co
mm
unitie
s, in
cludi
ng e
nter
ing,
ope
ratin
g an
d ex
iting.
Nat
ure,
scop
e, a
nd e
ffect
iven
ess o
f any
pro
gram
mes
and
pra
ctic
es th
at a
sses
s and
man
age
impa
cts o
f ope
ratio
ns o
n co
mm
unitie
s, in
cludi
ng e
nter
ing,
ope
ratin
g an
d ex
iting.
Dire
ct e
cono
mic
val
ue g
ener
ated
and
dis
tribu
ted,
incl
udin
g re
venu
es, o
pera
ting
costs
, em
ploy
ee c
ompe
nsat
ion,
don
atio
ns a
nd o
ther
com
mun
ity in
vestm
ents,
reta
ined
earn
ings
, and
pay
men
ts to
cap
ital p
rovi
ders
and
gov
ernm
ents.
Dev
elop
men
t and
impa
ct o
f inf
rastr
uctu
re in
vestm
ents
and
serv
ices
pro
vide
d pr
imar
ilyfo
r pub
lic b
enef
it th
roug
h co
mm
erci
al, i
n-ki
nd, o
r pro
-bon
o en
gage
men
t.N
atur
e, s
cope
, and
effe
ctiv
enes
s of
any
pro
gram
mes
and
pra
ctic
es th
at a
sses
s an
dm
anag
e im
pact
s of
ope
ratio
ns o
n co
mm
uniti
es, i
nclu
ding
ent
erin
g, o
pera
ting
and
exiti
ng.
Polic
y, p
ract
ices
and
pro
porti
on o
f spe
ndin
g on
loca
lly-b
ased
sup
plie
rs a
t sig
nific
ant
loca
tions
of o
pera
tion.
Proc
edur
es fo
r loc
al h
iring
and
pro
porti
on o
f sen
ior m
anag
emen
t hire
d fro
m th
elo
cal c
omm
unity
at s
igni
fican
t loc
atio
ns o
f ope
ratio
n.N
atur
e, s
cope
and
effe
ctiv
enes
s of
any
pro
gram
mes
and
pra
ctic
es th
at a
sses
s an
dm
anag
e im
pact
s of
ope
ratio
ns o
n co
mm
uniti
es, i
nclu
ding
ent
erin
g, o
pera
ting
and
exiti
ng.
Proc
edur
es fo
r loc
al h
iring
and
pro
porti
on o
f sen
ior m
anag
emen
t hire
d fro
m th
elo
cal c
omm
unity
at s
igni
fican
t loc
atio
ns o
f ope
ratio
n.U
nder
stand
ing
and
desc
ribin
g si
gnifi
cant
indi
rect
eco
nom
ic im
pact
s, in
clud
ing
the
exte
nt o
f im
pact
s.
Polic
y, p
ract
ices
and
pro
porti
on o
f spe
ndin
g on
loca
lly-b
ased
sup
plie
rs a
t sig
nific
ant
loca
tions
of o
pera
tion.
Soci
al a
nd e
cono
mic
indi
cato
rs
1G
RI G
3 Su
stain
abili
ty R
epor
ting
Gui
delin
es, ©
Glo
bal R
epor
ting
Initi
ativ
e (2
006)
.Fo
r mor
e in
form
atio
n an
d fu
ll te
xt o
f the
rele
vant
Indi
cato
r Pro
toco
ls se
e w
ww
.glo
balre
porti
ng.o
rg.
Con
tinue
d on
follo
win
g pa
ge …
IPIECA • API • OGP
136
Appen
dix
C:
Sum
mary
of
key
changes
sin
ce 2
005
and r
elationsh
ip t
o G
RI
G3 G
uid
elin
es
Tabl
e 6
(con
tinue
d) M
appi
ng th
e 20
10 G
uida
nce
agai
nst t
he 2
005
Gui
danc
e an
d G
RI G
3 G
uide
lines
Gui
danc
e In
dica
tors
200
5G
uida
nce
Indi
cato
rs 2
010
GRI
G3
Gui
delin
es In
dica
tors
1 (c
odes
in b
old
indi
cate
gre
ater
sim
ilarit
y)
Code
Nam
eCo
deN
ame
Code
Nam
e
SOC
-1SO
C-7
SOC
-9
SOC
-2
ECO
-A1
SOC
-3SO
C-A
1
SOC
-4
SOC
-A2
SOC
-5
SOC
-6
Perc
enta
ge a
nd to
tal n
umbe
r of s
igni
fican
t inv
estm
ent a
gree
men
ts th
at in
clud
ehu
man
righ
ts cl
ause
s or
that
hav
e un
derg
one
hum
an ri
ghts
scre
enin
g.To
tal h
ours
of e
mpl
oyee
trai
ning
on
polic
ies
and
proc
edur
es c
once
rnin
g as
pect
sof
hum
an ri
ghts
that
are
rele
vant
to o
pera
tions
, inc
ludi
ng th
e pe
rcen
tage
of
empl
oyee
s tra
ined
.
Perc
enta
ge o
f sig
nific
ant s
uppl
iers
and
con
tract
ors
that
hav
e un
derg
one
scre
enin
gon
hum
an ri
ghts
and
actio
ns ta
ken.
Perc
enta
ge o
f sec
urity
per
sonn
el tr
aine
d in
the
orga
niza
tion’
s pol
icie
s or p
roce
dure
sco
ncer
ning
asp
ects
of h
uman
righ
ts th
at a
re re
leva
nt to
ope
ratio
ns.
Perc
enta
ge a
nd to
tal n
umbe
r of b
usin
ess
units
ana
lyse
d fo
r ris
ks re
late
d to
corr
uptio
n.Pe
rcen
tage
of e
mpl
oyee
s tra
ined
in th
e or
gani
zatio
n’s
anti-
corr
uptio
n po
licie
san
d pr
oced
ures
.A
ctio
ns ta
ken
in re
spon
se to
inci
dent
s of
cor
rupt
ion.
Perc
enta
ge a
nd to
tal n
umbe
r of b
usin
ess
units
ana
lyse
d fo
r ris
ks re
late
d to
corr
uptio
n.
Dire
ct e
cono
mic
val
ue g
ener
ated
and
dist
ribut
ed, i
nclu
ding
reve
nues
, ope
ratin
gco
sts, e
mpl
oyee
com
pens
atio
n, d
onat
ions
and
oth
er c
omm
unity
inve
stmen
ts, re
tain
edea
rnin
gs, a
nd p
aym
ents
to c
apita
l pro
vide
rs a
nd g
over
nmen
ts.
Publ
ic p
olic
y po
sitio
n an
d pa
rtici
pato
n in
pub
lic p
olic
y de
velo
pmen
t and
lobb
ying
.To
tal v
alue
of f
inan
cial
and
in-k
ind
cont
ribut
ions
to p
oliti
cal p
artie
s, p
oliti
cian
s,an
d re
late
d in
stitu
tions
by
coun
try.
Com
posi
tion
of g
over
nanc
e bo
dies
and
bre
akdo
wn
of e
mpl
oyee
s pe
r cat
egor
yac
cord
ing
to g
ende
r, ag
e gr
oup,
min
ority
gro
up m
embe
rshi
p an
d ot
her i
ndic
ator
sof
div
ersi
ty.
Perc
enta
ge o
f tot
al w
orkf
orce
repe
sent
ed in
form
al jo
int m
anag
emen
t-wor
ker
heal
th a
nd s
afet
y co
mm
ittee
s th
at h
elp
mon
itor a
nd a
dvise
on
occu
patio
nal h
ealth
and
safe
ty p
rogr
amm
es.
Hea
lth a
nd s
afet
y to
pics
cov
ered
in fo
rmal
agr
eem
ents
with
trad
e un
ions
.
Ave
rage
hou
rs o
f tra
inin
g pe
r yea
r per
em
ploy
ee b
y em
ploy
ee c
ateg
ory.
Prog
ram
mes
for s
kills
man
agem
ent a
nd li
felo
ng le
arni
ng th
at s
uppo
rt th
e co
ntin
ued
empl
oyab
ility
of e
mpl
oyee
s an
d as
sist
them
in m
anag
ing
care
er e
ndin
gs.
Perc
enta
ge o
f em
ploy
ees
rece
ivin
g re
gula
r per
form
ance
and
car
eer d
evel
opm
ent
revi
ews.
Tota
l num
ber o
f Inc
iden
ts of
dis
crim
inat
ion
and
actio
ns ta
ken.
Soci
al a
nd e
cono
mic
indi
cato
rs (c
ontin
ued)
Hum
an ri
ghts
Labo
ur p
ract
ices
Secu
rity
Brib
ery
and
corr
uptio
n
Tran
spar
ency
of p
aym
ents
Polit
ical
con
tribu
tions
Polit
ical
lobb
ying
and
adv
ocac
y
Non
-dis
crim
inat
ion
and
equa
l opp
ortu
nity
Empl
oyee
sat
isfa
ctio
n
Trai
ning
and
dev
elop
men
t
Non
-reta
liatio
n an
d gr
ieva
nce
syste
m
SE8
SE9
SE10
SE11
SE12
SE13
SE14
SE15
SE16
SE17
SE18
Hum
an ri
ghts
due
dilig
ence
Hum
an ri
ghts
and
supp
liers
Secu
rity
and
hum
an ri
ghts
Prev
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Appendix D:
Measurement unitsand conversion factors
Reporting companies are encouraged to use generallyaccepted international units and to provide standardconversion factors that enable conversions to othercommonly used measurement units. The examples belowhave been provided by OGP and are as documented inthe OGP report No 2.59/197 on Methods for EstimatingAtmospheric Emissions from E&P Operations, 1994.
These conversion factors should be used only when thedata are available with a standard which differs fromthe required one, and when the ad hoc conversionfactor is not known (for example, when data related tothe quantity of oil produced are expressed in barrels ofoil equivalent (BOE) and when the mean density of theproduction is not known).
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138
Appendix D:
Measurement units and conversion factors
Appen
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t units
and c
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act
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The assumptions underlying the conversion factors are:● density of the oil: 0.84 t m-3 (t = metric tonne)● density of the condensate: 0.75 t m-3
● density of the associated gas: 1 kg m-3
● density of the non-associated gas: 0.80 kg m-3
● density of chemicals, solvents, and all other products spilled: 1.0 t m-3
Conversion factors for hydrocarbon production:
1 bbl of oil ≈ 0.159 m3 ≈ 0.134 t 1 bbl of condensate ≈ 0.119 t1000 m3 of associated gas ≈ 1.00 t1000 m3 of non-associated gas ≈ 0.80 t1000 ft3 of associated gas ≈ 28.3 m3 ≈ 0.0283 t1000 ft3 of non-associated gas ≈ 28.3 m3 ≈ 0.0226 t1000 bbl per day ≈ 48910 t per year
Conversion factors for atmospheric emissions:
CH4: Density: 0.714 x 10-3 t m-3
SO2: Mean density: 2.89 x 10-3 t m-3 1 t SO3 ≈ 1.20 t SO2
NOx: Mean density 2.02 x 10-3 t m-3 1 t NO ≈ 0.94 t NO2
CO2: Density: 1.96 x 10-3 t m-3
Conversion factors for produced water discharges:
1 bbl ≈ 0.159 m3
1 bbl per day ≈ 58.0 m3 per annum
Conversion factors for oil spills:
1 bbl of oil ≈ 0.159 m3 ≈ 0.159 m3 or ≈ 0.134 t1 bbl of condensate ≈ 0.119 t1 bbl of chemicals and others ≈ 0.159 t
Conversion factors for energy consumption:
1 calorie = 4.1868 joule
GCV = gross calorific value (= higher heating value, HHV)NCV = net calorific value (= lower heating value, LHV)
Diesel qualities (density and heating value) may differ from one part of the world to another. In theabsence of correct (local) data, the following values may be used:
1 t of diesel oil ≈ 42.8 GJ (gigaJoules)1 m3 of diesel oil ≈ 36.0 GJ, assuming a density of 0.84 t/m3
Field specific data for net calorific values (NCV) should be used if available. If such data areunavailable, the following values can be used:
1 Sm3 of natural gas (gas fields) ≈ 38 MJ (megaJoules)1 Sm3 of associated gas (oil fields) ≈ 42 MJ1 Sm3 of gas, unspecified ≈ 40 MJ
Ratios between GCV and NCV depend on hydrocarbon composition. Field specific data should thereforebe used if available: If such data are unavailable, the following values can be used:
Gas: GCV/NCV ≈ 1.1Oil: GCV/NCV ≈ 1.05Unspecified HC (oil and gas): GCV/NCV ≈ 1.075
The following default conversion factor can be used for purchased electricity, and assumes that theefficiency of electricity produced is 38% of the primary energy content of the fuel:
1 kilowatt hour (kWh) of purchased electricity = 0.0096 gigajoules (GJ) of imported primary energy
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Appendix E:
General referencesand source materials
General reporting references
AccountAbility. 2008. AA1000 Principles Standard.London, UK and Washington D.C., USA.www.accountability.org/standards/aa1000aps.html
AccountAbility. 2008. AA1000 Assurance StandardLondon, UK and Washington D.C., USA.www.accountability.org/standards/aa1000as.html
API. 1998. Model Environmental, Health and Safety(EHS) Management Systems and Guidance Document.API Publication 9011. Order No. R9100S.Washington, D.C., USA. www.api.org
GEMI. 2004. Transparency: A Path to Public Trustwww.gemi.org/GEMIPublications.aspx
GRI. 2006. Sustainability Reporting Guidelines.The Netherlands. www.globalreporting.org
IAASB (International Audit and Assurance StandardsBoard). 2005. International Standard on AssuranceEngagements (ISAE 3000). International Federation ofAccountants. New York, USA. www.ifac.org/Members/DownLoads/ISAE_3000.pdf
IPIECA/API. 2002. Compendium of SustainabilityReporting Practices and Trends for the Oil and GasIndustry. London, UK and Washington, D.C., USA.
IPIECA/API. 2005. Oil and Gas Industry Guidance onVoluntary Sustainability Reporting. London, UK andWashington, D.C., USA.www.ipieca.org/library
ISO. 2004. Environmental Management System—Specification with Guidance for Use. ISO 14001.Geneva, Switzerland. www.iso.ch/iso/en/iso9000-14000/iso14000/iso14000index.html
OGP. 1994. Guidelines for the Development andApplication of Health, Safety and EnvironmentalManagement Systems. Report No. 6.36/210. London,UK. www.ogp.org.uk/pubs/210.pdf
Environmental section references
IPCC. 1995. Second Assessment Report—ClimateChange 1995: The Science of Climate Change.www.ipcc.ch/ipccreports/sar/wg_I/ipcc_sar_wg_I_full_report.pdf [E1]
API. 2009. Compendium of Greenhouse Gas EmissionEstimation Methodologies for the Oil and Natural GasIndustry. Washington, D.C., USA.www.api.org/ehs/climate/new/upload/2009_GHG_COMPENDIUM.pdf [E1, E2 and E4]
IPIECA/API/OGP. 2011. Petroleum Industry Guidelinesfor Reporting Greenhouse Gas Emissions. London, UK.Scheduled for publication in 2011. www.ipieca.org[E1, E2 and E4].
WRI/WBCSD. 2004. The Greenhouse Gas Protocol: ACorporate Accounting and Reporting Standard(Revised Edition). Geneva, Switzerland andWashington, D.C., USA. www.ghgprotocol.org/files/ghg-protocol-revised.pdf [E1]
IPPC. 2007. ‘Changes in Atmospheric Constituents and inRadiative Forcing‘ (Chapter 2) in: Climate Change 2007:The Physical Science Basis. Contribution of WorkingGroup I to the Fourth Assessment Report of theIntergovernmental Panel on Climate Change. Solomon,S., Qin, D., Manning, M., Chen, Z., Marquis, M., Averyt,K.B., Tignor, M. and Miller H.L. (eds.). Cambridge, UK.www.ipcc.ch/publications_and_data/publications_ipcc_fourth_assessment_report_wg1_report_the_physical_science_basis.htm [E1]
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142
Appendix E:
General references and source materials
Appen
dix
E:
Gen
eral re
fere
nce
s and s
ourc
e m
ate
rials
North American Manufacturing. 1986. NorthAmerican Combustion Handbook, Volume I:Combustion, Fuels, Stoichiometry, Heat Transfer, FluidFlow. ISBN 0-9601596-2-2. Third Edition. Cleveland,Ohio, USA. [E2]
IPIECA. 2007. Climate Change: A Glossary of Terms.4th Edition. London, UK.www.ipieca.org/publication/climate-change-glossary-terms-4th-edition [E3]
US EPA. Compilation of Air Pollutant EmissionFactors, Volume I: Stationary Point and AreasSources, AP-42 (GPO 055-000-005-001). 5thEdition. Washington, D.C., January 1995, withSupplements A, B, and C, October 1996, andSupplement D, 1998. www.epa.gov/ttnchie1/ap42[E4, E7]
EBI (Energy and Biodiversity Initiative). Guidelines andproducts, 2003. www.theebi.org/products.html [E5]
IPIECA/OGP. 2005. A Guide to DevelopingBiodiversity Action Plans for the Oil and Gas Sector.London, UK. www.ipieca.org/publication/guide-developing-biodiversity-action-plans-oil-and-gas-sector[E5]
IPIECA. 2007. An Ecosystem Approach to Oil andGas Industry Biodiversity Conservation. London, UK.www.ipieca.org/publication/ecosystem-approach-oil-and-gas-industry-biodiversity-conservation [E5]
WRI. 2008. The Corporate Ecosystem ServicesReview: Guidelines for Identifying Business Risks andOpportunities Arising from Ecosystem Change.Hanson C., Ranganathan, J., Iceland, C., Finisdore, J.(eds.). Washington, D.C., USA. www.wri.org/publication/corporate-ecosystem-services-review [E5]
ISO. 2003. Environmental Management Systems.ISO 14001, Section 4.3.www.iso14000-iso14001-environmental-management.com [E5]
WRI/WBCSD. 2009. Global Water Tool. www.wbcsd.org/templates/TemplateWBCSD5/layout.asp?type=p&MenuId=MTc1Mg&doOpen=1&ClickMenu=LeftMenu [E6]
WHO (World Health Organization).www.who.int/topics/water/en [E6]
FAO (Food and Agriculture Organization of the UnitedNations). www.fao.org/nr/water/index.html [E6]
US Geological Survey. http://water.usgs.gov [E6]
EMEP/EEA. 2009. Emission Inventory Guidebook.www.eea.europa.eu/publications/emep-eea-emission-inventory-guidebook-2009 [E7]
CONCAWE. Air Pollutant Emission Estimating Methodsfor E-PRTR Reporting by Refineries (revised). Report1/09. Brussels, Belgium.www.concawe.org/DocShareNoFrame/Common/GetFile.asp?PortalSource=1856&DocID=18068&mfd=off&pdoc=1 [E7]
Health and safety section references
ILO. 1999. Report of the Director General: DecentWork. 87th Session. Geneva, Switzerland. www.ilo.org/public/english/standards/relm/ilc/ilc87/rep-i.htm [HS1]
ILO. 2002. Tripartite Meeting on the Promotion ofGood Industrial Relations in Oil and Gas Productionand Oil Refining. Geneva, Switzerland,25 February–3 March 2002. www.ilo.org/public/english/dialogue/sector/techmeet/tmor02/index.htm [HS1]
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eral referen
ces and so
urce m
ateria
ls
API. 2004. Five-point Approach to AddressingWorkplace Ergonomics.
CDC (Centres for Diseases Control and Prevention).www.cdc.gov [HS2]
ILO. 2001. The ILO Code of Practice on HIV/AIDS andthe World of Work. Geneva, Switzerland. www.ilo.org/public/libdoc/ilo/2001/101B09_133_engl.pdf [HS2]
OGP-IPIECA Health Committee. ‘Good practice’ HealthSeries. London, UK.www.ipieca.org/library [HS2]
OGP-IPIECA. 2008. Health Performance Indicators: Aguide for the oil and gas industry. London, UK.www.ipieca.org/publication/health-performance-indicators [HS2]
United Nations Programme on HIV/AIDS / GlobalBusiness Council/Prince of Wales Business Leaders’Forum. 2000. The Business Response to HIV/AIDS:Impact and Lessons Learned. www.gbcimpact.org[HS2]
OGP. Health and Safety Data Reporting System Users’Guide. London, UK. Updated yearly.www.ogp.org.uk [HS3]
U.S. Department of Labor, Occupational Safety andHealth Administration. 2001. Occupational Injury andIllness Recording and Reporting Requirements. 29 CFRPart 1904.www.osha.gov/recordkeeping/index.html [HS3]
CEFIC. 2001. Reporting of Occupational IllnessFrequency.www.cefic.be/Files/Publications/CEFIC1012-109.PDF[HS3]
Step Change in Safety. 2006. Leading PerformanceIndicators—Guidance for Effective Use.http://stepchangeinsafety.net/stepchange//SingleItem_Resource.aspx?ID=3428 [HS3]
OECD. 2000. Guidelines for Multinational Enterprises.www.oecd.org/department/0,3355,en_2649_34889_1_1_1_1_1,00.html [HS4]
ISO. Management System Standards: Understandingthe Basics. www.iso.org/iso/iso_catalogue/management_standards/understand_the_basics.htm [HS4]
ICCA. 2008. Global Product Strategy.www.icca-chem.org/Home/ICCA-initiatives/Global-product-strategy [HS4]
API. 2010. Recommended Practice 754—ProcessSafety Performance Indicators for the Refining andPetrochemical Industries. Washington, D.C., USA.www.api.org/standards/psstandards [HS5]
OGP. 2008. Asset integrity—the key to managingmajor incident risks. Report No. 403. London, UK.www.ogp.org.uk/pubs/403.pdf [HS5]
OGP. 2011. Asset Integrity—Key PerformanceIndicators. London, UK. Scheduled for publication in2011. www.ogp.org.uk [HS5]
CCPS. 2007. Guidelines for Risk Based Process Safety.American Institution of Chemical Engineers. New York,USA. www.aiche.org/ccps [HS5]
CCPS. 2009. Guidelines for Process Safety Metrics.American Institute of Chemical Engineers. New York,USA. www.aiche.org/ccps [HS5]
CCPS. 2008. Process Safety Leading and LaggingMetrics. American Institute of Chemical Engineers. NewYork, USA. www.aiche.org/ccps [HS5]
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Gen
eral re
fere
nce
s and s
ourc
e m
ate
rials
UK Health and Safety Executive (HSE). 2006. Step-By-Step Guide to Developing Process Safety PerformanceIndicators. HSG254. Sudbury, Suffolk, UK.www.hse.gov.uk/pubns/books/hsg254.htm [HS5]
OECD. 2008. Guidance on Safety PerformanceIndicators Related to Chemical Accident Prevention,Preparedness and Response for Industry. Environment,Health and Safety Publications, Series on ChemicalAccidents No. 19. Paris, France.www.oecd.org/document/61/0,3343,en_2649_34369_2789821_1_1_1_1,00.html [HS5]
Social and economic section references
IPIECA. 2006. Partnerships in the Oil and GasIndustry. London, UK.www.ipieca.org/publication/partnerships-oil-and-gas-industry [SE1]
IPIECA. 2008. Creating Successful, Sustainable SocialInvestment: Guidance document for the oil and gasindustry. London, UK.www.ipieca.org/publication/guide-successful-sustainable-social-investment-oil-and-gas-industry[SE1, SE4]
Zandvliet, L. and Anderson M.B. 2009. Getting it Right:Making Corporate-Community Relations Work. ISBN 978-1-906093-19-8. Greenleaf Publishing. [SE1]
IFC. 2010. Good Practice Handbook on StrategicCommunity Investment. Washington, D.C., USA.www.ifc.org/ifcext/sustainability.nsf/Content/Publications_Handbook_CommunityInvestment [SE1]
IFC. 2006. Performance Standard 7: IndigenousPeoples. Performance Standards on Social andEnvironmental Sustainability. Washington, D.C., USA.www.ifc.org/ifcext/sustainability.nsf/AttachmentsByTitle/pol_PerformanceStandards2006_PS7/$FILE/PS_7_IndigenousPeoples.pdf [SE2]
ILO. 1989. Convention 169 on Indigenous and TribalPeoples. Geneva, Switzerland.www.ilo.org/indigenous/lang--en/index.htm [SE2]
UN General Assembly. June 2007. Declaration on theRights of Indigenous Peoples. www.un.org/esa/socdev/unpfii/en/declaration.html[SE2]
IFC. 2006. Performance Standard 1: Social andEnvironmental Assessment and Management Systems.Performance Standards on Social and EnvironmentalSustainability. Washington, D.C., USA.www.ifc.org/ifcext/sustainability.nsf/Content/PerformanceStandards [SE3]
IFC. 2006. Performance Standard 5: Land Acquisitionand Involuntary Resettlement. Performance Standardson Social and Environmental SustainabilityWashington, D.C., USA. www.ifc.org/ifcext/sustainability.nsf/Content/PerformanceStandards [SE3]
The London Benchmarking Group provides a modelused by many companies around the world to assessand report on the value and achievements of theirsocial investments. www.lbg-online.net/lbg [SE4]
IPIECA. 2011. Oil and Gas Industry Guidance onDeveloping a Local Content Strategy. London, UK.Scheduled for publication in 2011. www.ipieca.org[SE5]
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eral referen
ces and so
urce m
ateria
ls
ICMM. 2008. Resource Endowment Toolkit: TheChallenge of Mineral Wealth: Using ResourceEndowments to Foster Sustainable Development.www.icmm.com/page/2915/resource-endowment-initiative-toolkit [SE6]
EBRD. Maximising the Positive Socio-Economic Impactof Mineral Extraction on Regional Development inTransition Economies: A Review of the Literature.Professor R.M. Auty, Lancaster University (ed.).www.ebrd.org/downloads/research/economics/auty.pdf [SE6]
EAP. 2009. Maximising the Contributions of LocalEnterprises to the Supply Chain of Oil, Gas andMining Projects in Low Income Countries. Briefing note.www.engineersagainstpoverty.org/eaps_programme/extractive_industries.cfm [SE7]
WBCSD. 2007. Promoting Small and MediumEnterprises for Sustainable Development. Issue brief.Geneva, Switzerland.www.wbcsd.org/Plugins/DocSearch/details.asp?DocTypeId=25&ObjectId=MjU1MTM [SE7]
UN General Assembly. December 1948. UniversalDeclaration of Human Rights (UDHR).www.un.org/en/documents/udhr [SE8]
UN General Assembly. December 1966. TheInternational Covenant on Civil and Political Rights(ICCPR). www.unclef.com/millennium/law/iv-4.htm[SE8]
ILO. 1998. Declaration on Fundamental Principles andRights at Work. Geneva, Switzerland. [SE8]
IBLF (International Business Leaders Forum)/BSR(Business for Social Responsibility). 2000. VoluntaryPrinciples on Security and Human Rights.www.voluntaryprinciples.org [SE8]
UN Secretary-General’s Special Representative forBusiness and Human Rights. 2008. Protect, Respectand Remedy: a Framework for Human Rights andBusiness. Professor John Ruggie. www.business-humanrights.org/Links/Repository/965591[SE8]
OECD. 2000. Guidelines for Multinational Enterprises.www.oecd.org/department/0,3355,en_2649_34889_1_1_1_1_1,00.html [SE8]
GRI. 2009. A Resource Guide to Corporate HumanRights Reporting. GRI Research and DevelopmentSeries. Amsterdam, The Netherlands.www.globalreporting.org/NR/rdonlyres/4C5DB4C6-5084-4A84-BE51-0D134B3B5A2E/3583/HR_ReportFINAL_Resource_Guide.pdf [SE8]
DIHR. 2005. Human Rights Compliance AssessmentTool. Under revision, second edition scheduled for 2010.www.humanrightsbusiness.org/?f=country_risk_portal[SE8]
Voluntary Principles on Security and Human RightsReporting Guideline. The Voluntary Principles SteeringCommittee, 2009. [SE10]
EITI. Since 2002. Extractive Industries TransparencyInitiative, including the EITI Business Guide.www.eiti.org [SE13]
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IPIECA is the global oil and gas industry association for environmental and social issues. It develops,shares and promotes good practices and knowledge to help the industry improve its environmental andsocial performance; and is the industry’s principal channel of communication with the United Nations.Through its member-led working groups and executive leadership, IPIECA brings together the collectiveexpertise of oil and gas companies and associations. Its unique position within the industry enables itsmembers to respond effectively to key environmental and social issues.
5th Floor, 209–215 Blackfriars Road, London SE1 8NL, United KingdomTelephone: +44 (0)20 7633 2388 Facsimile: +44 (0)20 7633 2389E-mail: info@ipieca.org Internet: www.ipieca.org
Regional Association of Oil, Gas and BiofuelsSector Companies in Latin America and theCaribbean (ARPEL)
Javier de Vana 1018
11200 Montevideo
Uruguay
Telephone: +598 2410 6993
Internet: www.arpel.org
African Refiners Association (ARA)
Lot 70 Rue des Cannas
Ilot 6 B Danga Sud Cocody Danga - Abidjan
08 BP 2565 ABIDJAN 08 Côte d’Ivoire
Telephone: +225 2244 6616
Internet: www.afrra.org
Canadian Petroleum Products Institute (CPPI)
1000-275 Slater Street
Ottawa, Ontario, K1P 5H9
Canada
Telephone: +1 613 232 3709
Internet: www.cppi.ca
The American Petroleum Institute is the primary trade association in the United States representing theoil and natural gas industry, and the only one representing all segments of the industry.
Representing one of the most technologically advanced industries in the world, API’s membershipincludes more than 400 corporations involved in all aspects of the oil and gas industry, includingexploration and production, refining and marketing, marine and pipeline transportation and serviceand supply companies to the oil and natural gas industry. API is headquartered in Washington, D.C.and has offices in 27 state capitals and provides its members with representation on state issues in 33states. API provides a forum for all segments of the oil and natural gas industry to pursue public policyobjectives and advance the interests of the industry. API undertakes in-depth scientific, technical andeconomic research to assist in the development of its positions, and develops standards and qualitycertification programmes used throughout the world. As a major research institute, API supports thesepublic policy positions with scientific, technical and economic research.
1220 L Street NW, Washington DC, 20005-4070, USATelephone: +1 202 682 8000 Internet: www.api.org
OGP represents the upstream oil and gas industry before international organizations including theInternational Maritime Organization, the United Nations Environment Programme (UNEP) RegionalSeas Conventions and other groups under the UN umbrella. At the regional level, OGP is the industryrepresentative to the European Commission and Parliament and the OSPAR Commission for the NorthEast Atlantic. Equally important is OGP’s role in promulgating best practices, particularly in the areasof health, safety, the environment and social responsibility.
London office 5th Floor, 209–215 Blackfriars Road, London SE1 8NL, United KingdomTelephone: +44 (0)20 7633 0272 Facsimile: +44 (0)20 7633 2350E-mail: reception@ogp.org.uk Internet: www.ogp.org.uk
Brussels officeBoulevard du Souverain 165, 4th Floor, B-1160 Brussels, BelgiumTelephone: +32 (0)2 566 9150 Facsimile: +32 (0)2 566 9159E-mail: reception@ogp.org.uk Internet: www.ogp.org.uk
© IPIECA/API/OGP 2010 All rights reserved.
Brazilian Petroleum, Gas andBiofuels Institute (IBP)
Av. Almirante Barroso
52 - 26o Andar - Centro
Rio de Janeiro
CEP 20031-000
Telephone: +55 21 2112 9000
Internet: www.ibp.org.br
South African Petroleum Industry Association(SAPIA)
31 Norfolk Street
Claremont, 7708
South Africa
Telephone: +27 (0)11 783 7664
Internet: www.sapia.co.za
Endorsed by: