Sustainability reporting on the rise within the Petroleum Industry - A view of the industry and experiences from an NOC, IOC and Service Company

Abstract

Abstract In 1987, the Brundtland Report, "Our Common Future", produced the widely accepted definition of sustainable development as "meeting the needs of the present without compromising the ability of future generations to meet their own needs". But what can sustainability mean for the oil and gas industry, which produces fossil fuel required to meet basic human needs today such as food, fuel and shelter? The oil and gas industry provides a fundamental energy resource while improving health, reducing poverty, and increasing productivity for the global population. Oil and gas are therefore integral to promoting economic growth and will continue to play a major role in meeting the world's energy needs for the foreseeable future. Global energy policies are promoting low-carbon energy technologies, and the use of modern renewables will almost triple by 2035 to about 14% of total supply. However, renewables cannot satisfy global demand growth, so consumption of both oil and gas will also continue to grow.1 Oil and gas companies must therefore continue to discover, produce and supply these energy resources, and it is essential that they do so in a safe, environmentally sound and socially responsible manner. This requires safeguarding the environment; respecting the rights of others; protecting the health, safety and security of workers and the public; meeting increasingly stringent laws and regulations, and yet managing a range of operational, reputational and financial risks. An additional responsibility for companies is the need to communicate openly how they conduct their operations – the vision, decisions and strategies used to pursue resource developments. Sustainability reporting is therefore both a responsible and an expected method for companies to communicate publicly on environmental and social performance. The oil and gas industry has made significant progress on these objectives but challenges remain and individual companies need to tell their own sustainability stories in a clear, transparent, and honest manner. Finally, sustainability reporting also helps to establish a basis for continuous improvement in business processes and risk management. In particular, reporting has value for reputational risk, access to capital, and strengthened customer and employee relationships. For oil and gas companies, reporting can provide a robust platform for describing how strategic issues are being addressed through long-term plans and current initiatives. Stakeholders can now find details of a company's high level vision and strategy for dealing with sustainability-related impacts, implementing action plans and assessing outcomes on company websites and in annual reports.