Approach to managing ESG issues
The adoption of the PGE Group’s strategy until 2030 with an outlook to 2050, which sets out the directions for the energy transition, the decarbonisation of generation and the path towards climate neutrality, started the process of implementing the structured management of the ESG area in the PGE Group.
Climate neutrality, responsible management, good stakeholder relations are the basis of
the PGE Group’s approach to managing ESG factors.
For the PGE Group, reporting on ESG factors is one of the elements on the way to managing the company’s sustainability area. The most important thing is to define ESG objectives and to pursue them effectively, and without a conscious approach to the reporting of non-financial information, it would not be possible to manage and improve the company’s activities in this area effectively.
Implementing ESG issues into the organisation’s operating framework required a remodelling of the governance system. For this reason, on 21 December 2021, the Management Board of PGE Polska Grupa Energetyczna S.A., by resolution, appointed the Management Board Proxy for ESG, as well as the Sustainability Committee headed by the President of the Management Board and the Vice President for Finance.
Division of roles and responsibilities in the ESG area
Sustainability Committee
The Committee’s task is to ensure the integrity of the sustainability area in the PGE Group by overseeing the implementation of processes in the ESG area. The wide range of tasks to be carried out in the Group requires the involvement of a number of organisational structures, which is reflected in the composition of the Committee, whose members are the directors of the key organisational units in the ESG area. During Committee meetings, the challenges faced by the Group, stakeholder expectations, good market practices as well as ongoing and planned ESG initiatives are discussed.
The basis for the development of the PGE Group’s ESG system is the continuous identification of key stakeholder expectations and the ongoing implementation of regulatory requirements in this area. This includes setting short- and long-term goals, consistent with the Group’s pursued strategy. In order to ensure that they are achieved, in the case of new expectations, it is necessary to develop detailed management rules, which primarily include cooperation among Group companies.
Until the end of 2023, the Sustainability Committee meetings discussed topics such as
Sustainability challenges in the coming years
Challenges for PGE from financial institutions
ESG risks
Carbon footprint management issues
CDP reporting
ESG ratings
The Committee was directly informed of the activities of the dedicated working teams. The delivered results were the starting point for planning ESG activities in the following months and years. Information on the scope of the Committee’s work was also presented at meetings of the PGE S.A. Management Board.
In order to increase the efficiency of the organisation’s environmental impact management, the Environmental Protection Department, which is also responsible for the PGE Group’s carbon footprint issues, was established at PGE S.A. in 2022. As part of social impact management and dialogue with the social partner, PGE S.A. has a Dialogue and Social Relations Department. Both these structures operate within the Operations Division, which reports to the Vice President for Operations.
The operational coordination of the ESG process is carried out by the Investor Relations and ESG Department, which is also responsible for the implementation of ESG communication, stakeholder dialogue and non-financial reporting.
Reporting of non-financial information
The basis for ESG development in the PGE Group is PGE’s long-standing experience in
communicating with stakeholders and reporting non-financial information.
In this area, the PGE Group already has almost 10 years of experience and responds to the growing expectations of the social environment on an ongoing basis.
The PGE Group’s first social report was developed for the years 2013-2014 and was based on the Global Reporting Initiative (GRI) international reporting standard at the CORE level. The following year, PGE began publishing cyclical integrated reports, also keeping in mind the expectations of investors and other financial institutions. Since 2016, one year before the Non-Financial Reporting Directive (NFRD) came into force, the PGE Group has published information in accordance with the Directive’s requirements. Since 2011, PGE S.A. has been included in the Warsaw Stock Exchange’s “Respect Index”, subsequently replaced by the WIG-ESG index, which is made up of companies mature in managing ESG factors. Participation in the Responsible Corporations Ranking has earned PGE the title of responsible business leader in the power generation sector for three consecutive years. In connection with the implementation of the Corporate Sustainability Reporting Directive (CSRD), the PGE Group has already been actively preparing for the new sustainability reporting guidelines since September 2023, with preparations covering all key areas of the Group’s operations.
A statement of non-financial information is approved by the Management Board of PGE S.A. and its content is also reviewed by the Supervisory Board.
Education for sustainable development
The PGE Group is keen to disseminate ESG knowledge among Polish enterprises and the company’s suppliers in order to create an “ESG value chain”. In its brand strategy, PGE has taken on the role of a leading company in green change: in the literal sense of the word, both as a leader of change in the Polish electricity market, but also as a guardian and advisor in the area of green energy.
For the PGE Group, a sustainable company is one that not only meets standards itself, but also consciously chooses its suppliers – enterprises that operate ethically and monitor their carbon footprint. Through its actions, the PGE Group meets the expectations of its customers, not only individual customers but also institutional ones, who expect the supply of green energy, which has a significant impact on the carbon footprint of their products and services.
As part of the dialogue and sharing of experience in the ESG area with the external environment, the Management Board Proxy for ESG actively participates in debates and conferences related to sustainable business development.
The process of educating the Group’s employees in the ESG area continued in the PGE
Group in 2023.
Advanced ESG training courses were targeted at employees directly involved in the sustainability management and reporting process, but awareness of the importance of this area in business management was being built among all PGE employees. At the executive level, more than 270 employees took part in training courses in a classroom or online format. In 2023, an e-learning training was also implemented. Participation in selected training events has been obligatory for all PGE S.A. employees since January 2024. The range of training courses is planned to be extended to cover more PGE Group companies in the coming months.
As part of building awareness of ESG among employees, internal communication activities are being undertaken. Educational articles are being developed in the in-house corporate magazine and on the company intranet. Plans also provide for the implementation of podcasts that will give employees an even better understanding of what ESG is and how sustainability measures are implemented in the PGE Group.