For the global energy industry, the conundrum is obvious

For the global energy industry, the conundrum is obvious
Date: Tuesday, 22 June 2021 03:31

It’s a daunting challenge and this sector alone already has an extensive and highly significant social, environmental and economic footprint.

Yet there are growing examples of best practice, with more and more companies shifting priorities by using business intelligence to not only save on costs but to also become environmentally aware.

Among the many companies becoming more eco-friendly is the oil giant LUKOIL, one of the world’s largest energy providers, employing over 100,000 people in 30 countries. LUKOIL is certainly doing its bit on the environmental sustainability front.

It publishes a sustainability report annually to give detailed data on its contribution to the UN Sustainable Development Goals and show how, each year, it is implementing the company’s strategy in this particular sector.

LUKOIL has, in fact, been publishing such reports since 2005, informing shareholders and others about its environmental, social and economic activities.

These, for example, show how the company is committed to improving industrial safety, reducing on-the-job injury rates, ensuring accident-free operation of its production facilities, and continuously reducing our environmental impacts.

The Group is also focused achieving more rational use of resources, be it natural or human.

Recognition of its efforts in this area came in 2019 when LUKOIL was voted in the top five for environmental openness rating among Eurasian oil & gas companies.

The Russian WWF and the CREON analytical group assessed the potential environmental impact and information transparency of 20 Russian companies, 14 companies from Kazakhstan, and 2 companies from Azerbaijan.

The WWF/CREON citation said that LUKOIL was one of the first Russian companies to adopt the Industrial Safety, Labour and Environment Protection Policy and that the Group had taken over 900 environmental measures, ranging from air emissions reduction to efficient use of water resources.

"The company publishes its Sustainability Report annually and demonstrates maximum openness during its interaction with civil society, local communities, and indigenous peoples when discussing future and existing projects," it said.

LUKOIL’s latest sustainability report highlights, for example, the extent it goes to pursue a responsible social policy towards its employees and their living standards in those regions where it operates. In 2019, for instance, the share of employees of LUKOIL Group covered by collective agreements equaled 88.9%; some 258,000 of its staff received training and external social support contributions amounted to some RUB 9 billion.

LUKOIL also recognizes the importance of the need for global climate change prevention measures and supports Russia’s participation in joint efforts to reduce greenhouse gas (GHG) emissions. It also sees improvement of energy efficiency as one of the main factors to reduce the environmental impact of its operations.

One of the key elements of LUKOIL’s Sustainability Development Strategy is to ensure a high level of occupational health and safety. Environmental protection is another priority, with costs in this sphere alone amounting to some RUB 36 billion in 2019.

A company spokesman said: "The company’s approach to sustainability management is based on the alignment of our interests and plans with the basic principles of sustainable development declared by the UN, universal values and national development priorities."

Further comment comes from Ravil Maganov, chairman of its board of directors, who said that LUKOIL has "continued steadily developing its business and making strong contribution to the UN Sustainable Development Goals".

The group, according to the latest sustainability report, is "fully supportive" of the United Nations 2030 Agenda for Sustainable Development and recognizes that the UN goals "are of vital importance for ensuring a prosperous future for the human society."

But it also goes on to conceded that "greater efforts are required to ensure that the positive changes being made in support of a number of goals are sustainable.

"Therefore, we continue to implement programmes aimed at both improving the operational performance of our enterprises and ensuring the wellbeing of the people living in the regions where we operate."

The report concludes: "We have identified 11 global goals and 15 targets which we consider to be the most relevant to our operations and to which we are able to contribute. We achieved good success in 2019, but much remains to be done."

New sustainability report of LUKOIL is expected to be published this July.

Aside from LUKOIL plenty of other examples of what companies are doing to foster environmental sustainability abound, including Johnson & Johnson, most recently in the headlines for its contribution to tacking the pandemic.

For more than 20 years now, it has taken the lead in manufacturing personal care products that are environmentally responsible. It also has initiatives that reduce waste in the course of manufacturing and distribution through use of sustainable products and packaging methods where possible.

Automotive companies are thought to be among the heaviest polluters. However, Ford is changing this narrative through a ten-part environmental policy that they have implemented for years. The company uses sustainable fabrics in its vehicles while 80% of both its Focus and Escape vehicles are recyclable. The company also focuses on fuel efficiency, particularly on the six-speed transmission, offering a clean diesel heavy duty pickup truck.

Disney, another example, uses zero net direct greenhouse gas emission policies within all its facilities while computer giant Hewlett-Packard is one of the first companies to have reported its greenhouse gas emissions. They have also initiated plans that are aimed at reducing emissions and cutting back on toxic substances used in manufacturing its products like cartridges.

Ebay is another company with its focus on environmental sustainability. The company has made it possible for people to exchange or reuse goods instead of throwing them away while Google has demonstrated its commitment to going green through initiatives like powering its facilities with renewable energy sources, hosting farmers’ markets as well as sustainable cooking seminars and bringing goats to trim grass.


Elsewhere, Viatris is a global healthcare company formed in November 2020 with a workforce of more than 40,000. In Europe, it is one of the leading pharmaceutical companies. Head of Europe Viatris Eric Bossan told this website: "Sustainability for us refers to the long-term durability of our overall performance.

"Viatris empowers people worldwide to live healthier at every stage of life. As part of that commitment, we are upholding sustainable and responsible operations, and work diligently to reduce our environmental impact."

Bossan added: "We have an integrated approach focused on managing our water use, air emissions, waste, climate change and energy impact; some examples of our efforts are: we grew the use of renewable energy by 485% in the past five years, and all sites from our legacy company Mylan in Ireland – a country where we have the highest number of sites in Europe — are using 100% renewable energy."