Sustainability in Enel

At Enel, sustainability is a strategic part of running and developing our business in line with our business plan. The integration of governance, the environment, and managing relationships with interest groups and communities with economic and financial factors enables us to create value both for the business and for the social contexts in which the Group operates, from the perspective of stable growth and social inclusion over the medium and long term. In 2013, in line with our in-house CSR policy, we:

  • continued developing the organization and structure of the CSR processes of planning, monitoring and reporting;
  • structured coordination by the Parent Company of the various CSR policies and activities, as well as of the guidelines established in our Strategic Sustainability Plan;
  • established the country/division CSR committees and appointed the CSR managers in the various countries in order to implement local sustainability policies and strategies and the various CSR projects and other activities called for in the Plan.

In particular in 2013, Enel Green Power began efforts to bring the culture of sustainability to its own processes so as to orient its business model to the creation of shared value and the rational use of resources. The company also established short, medium and long-term action plans in order to ensure that sustainability becomes an integrated part of its day-to-day operations.

The Enel Group’s materiality matrix

In line with the latest international innovations, Enel has continued working on the materiality analysis process, efforts which began in 2012 in order to map out and study the issues of interest and the expectations of our stakeholders, as well as to bring the Company’s processes and procedures in line with these expectations. The unification of these two perspectives will enable us to identify the issues of most importance to both the Company and our stakeholders (i.e. the “material issues”) and to verify the degree of alignment or misalignment between outside expectations and internal relevance.

Based on this assessment, we have established the objectives of the Strategic Sustainability Plan and determined the content and information to be included in the Sustainability Report.

The 2013-2017 Sustainability Plan

The sustainability plan focuses on the most relevant issues as determined by the analysis of materiality, while also specifying the goals and specific targets that Enel has set for the Group for the coming years.

  • Business and governance issues: creation of financial value, governance, fairness and transparency, development of renewable energy, energy efficiency, and ESG risk management.
  • Environmental issues: lowering emissions, making efficient use of water, biodiversity, and global environmental management.
  • Social issues: access to electricity, responsible relationships with the community, the respect of individual rights, quality for the customer, the development of people, diversity and equal opportunity, health and safety in the workplace, and a responsible supply chain.

The CSR data collection system

In order to monitor our sustainability performance and to ensure the thorough traceability of data owners, we have launched a data collection system in collaboration with the External Relations and Administration, Finance & Control departments. Beginning in 2014, after establishing a dedicated information system that is to be integrated into the current system used to collect financial data, it will be possible to collect and monitor financial and other data and related communications in an integrated, consistent manner throughout the Group and in line with international standards.

The system is also in line with the guiding principles of the One Company project and will ensure that data will be gathered at the individual company level by way of an accurate process of identifying the various data owners.

Sustainability reporting

Since 2002, Enel has, with its Sustainability Report, maintained a constant commitment to measuring and reporting on corporate responsibility, ensuring maximum transparency for all its stakeholders and continuous implementation of its sustainability strategy. The reporting process involves collecting and analyzing specific key financial, environmental and social performance indicators.

Enel’s Sustainability Report is prepared in accordance with the Global Reporting Initiative (GRI) international standard and the related Electric Utility Sector Supplement (EUSS), as well as with the United Nations Global Compact and principles of accountability.

Enel has also begun revising the structure of our Sustainability Report and the process of materiality analysis based on the new GRI (GRI-G4) guidelines published in May 2013, while also beginning the process of integrated the new G4 indicators into our CSR data collection system.

The thoroughness and reliability of the Sustainability Report are assessed by an external auditing firm, by the Control & Risk Committee and also, since 2012, by the Nomination & Corporate Governance Committee. The document is then approved by the Enel SpA Board of Directors before being presented to the shareholders.

The Enel Group in international sustainability networks

Since 2004, Enel has been an active member of the United Nations Global Compact, and since 2011 we have been a member of the steering committee of the Global Compact LEAD program, which is made up of the organizations most committed to promoting new global initiatives in sustainability.

The Global Compact is an action program being promoted by the UN Secretary General with the goal of involving the private sector in a new form of public-private partnership through adherence to the ten universal principles that concern human rights, employment, environmental protection and the fight against corruption.

In 2013 in particular, Enel’s efforts focused on our involvement in the global consultation to set the targets of sustainable development that are to replace the Millennium Development Goals that will expire in 2015.

The post-2015 agenda was the focus of the 2013 Leaders Summit held in New York in September 2013, which brought together over 3,000 representatives from businesses, institutions and civil society from around the world in order to establish the next global architecture for corporate sustainability. In conjunction with the Leaders Summit, the United Nations selected Enel to present the Lead Board Program, which seeks to provide company boards with in-depth information prepared by leading international experts in the integration of sustainability in business strategy. Enel is one of the first corporations to have confirmed its participation in the pilot stage of this program.

Other international sustainability initiatives that Enel has undertaken include:

  • supporting the Global Reporting Initiative (GRI) in defining the new GRI-G4 guidelines, which were presented in May 2013 in Amsterdam during the Global Conference on Sustainability Reporting;
  • our active contribution, as a member of the IIRC pilot program, in developing the new international formats that will be used to certify and standardize integrated reporting;
  • our involvement – as the first utility in the world to do so – in the assessment of Ceres, the non-profit organization that is mobilizing businesses and investors to take on the challenges of sustainability as concerns its efforts to manage water-related risks. Named “Aqua Gauge”, the initiative was presented to the European Parliament in September 2013;
  • our commitment to support the domestic and international activities of Transparency International, serving as members of the Business Advisory Board of this important organization.

Enel and socially responsible investors

Eleven years ago, Enel started down the road to achieving the highest sustainability standards and has been rewarded with the interest of socially-responsible investment funds, which continue to expand despite the challenging international economic climate: at December 31, 2013, Enel shares were held by 117 (108 in 2012) socially-responsible investors (SRIs), representing about 15.6% of our identified institutional shareholders (14.6% in 2012).

This figure refers to SRIs that include Environmental, Social, Governance (ESG) standards among the criteria used in making investment decisions. At December 31, 2013, these investors held around 5.5% of Enel’s total shares outstanding (5.0% in 2012), equal to about 8% of the float (7.3% in 2012). These funds represent a stable shareholder base with a welldiversified geographical presence, covering continental Europe, the United Kingdom and North America.

In 2013, for the tenth straight year, Enel was included in the Dow Jones Sustainability Index, a market benchmark which includes the world’s leading companies that meet strict economic, social and environmental criteria. During the year, Enel was again included in the FTSE4Good Index, which measures environmentally sustainable corporate practices, relations with stakeholders, respect for human rights, the quality of working conditions, and the tools that companies employ to fight corruption, and we are one of the utility companies involved in the Carbon Disclosure Project (CDP).

The four pillars of corporate ethics

For over ten years, Enel has had a solid system of ethics that underlies our sustainability efforts. This system has become a dynamic set of rules constantly incorporating international best practices, a body of “common law” governing participation in the company, the rules of citizenship that everyone who works for and with Enel must respect and apply in their daily activities.

Code of Ethics

Our awareness of the social and environmental repercussions of the Group’s activities and the importance of a transparent and fair approach with stakeholders prompted Enel, in 2002, to adopt a Code of Ethics.

As such, this Code of Ethics lays the groundwork for all of our activities and expresses our commitment and ethical responsibility in doing business, while also guiding and standardizing corporate conduct based on the utmost transparency, respect and fairness towards all stakeholders.

The document applies to the entire Group, with consideration given to the cultural, social and economic diversity found in the various countries in which Enel does business. The Code is binding on the conduct of all of Enel’s employees. All of the companies in which Enel has an equity interest and the Group’s major suppliers and partners are also required to adhere to the general principles contained therein. Any stakeholder can report a violation or suspected violation of the Code of Ethics through dedicated channels.

Compliance Model (Legislative Decree 231/2001)

In 2002, the Board of Directors of Enel SpA approved a Compliance Model that meets the requirements of Legislative Decree 231 of June 8, 2001, which introduced into Italian law a system of administrative (though actually criminal) liability for companies for certain types of offences committed by its directors, executives or employees on behalf of or to the benefit of the company.

Having been approved and implemented by the Group companies in Italy, the model serves as a point of reference for all who act in the name and on behalf of Enel such that they can conduct themselves in line with the standards of transparency and responsibility in relations within the Company and with the outside world.

In 2010, Enel SpA also approved specific Guidelines aimed at extending the principles set out in the Compliance Model to the Group’s foreign subsidiaries, in order to make them more aware of the importance of ensuring the same conditions of fairness and transparency in the conduct of their business and corporate activities and to prevent situations that could result in administrative liability pursuant to Legislative Decree 231/2001 for the Parent Company, Enel SpA, and the other Italian companies of the Group.

Zero-Tolerance-of-Corruption Plan

In 2006, the Board of Directors approved the adoption of the Zero-Tolerance-of-Corruption (ZTC) Plan as a concrete move marking Enel’s participation in the Global Compact (a 2000 UN program of action) and the Partnering Against Corruption Initiative (PACI) promoted by the World Economic Forum in Davos in 2005.

The ZTC Plan does not replace or overlap the Code of Ethics or the Compliance Model, but is rather a more detailed plan for addressing the issue of corruption by following a series of recommendations for implementing principles developed by Transparency International.

Policy on Business and Human Rights

In order to give effect to the guidelines of the UN Forum on Business and Human Rights, on February 5, 2013, the Board of Directors of Enel SpA approved a Human Rights Policy, which was subsequently extended to all of the Group’s subsidiaries. In line with the Code of Ethics, the policy sets out the commitments and responsibilities in respect of human rights on the part of the employees of Enel SpA and its subsidiaries, whether they be directors or employees in any manner of those companies. Similarly, with this formal commitment, Enel explicitly becomes a promoter of the observance of such rights on the part of contractors, suppliers and business partners as part of its business relationships.

Within the scope of the due diligence in respect of human rights, in 2013 we also launched the risk-assessment process aimed at identifying the main risks in the area of human rights that the Company may encounter in the course of operations in various countries and through relations with third parties in general. The first phase of this risk assessment called for the inclusion of an ESG country-risk indicator within the Group’s risk-management process in order to quantify the risks that could have a negative impact on the Company, such as the violation of human rights and the potential involvement in the illegal conduct of others, which could expose the Company to systemic risks connected with certain institutional and environmental conditions.

Selected sustainability indicators

Net efficient capacity by primary energy source

MW     
 2013 2012 Change 
Net efficient thermal capacity         
- Coal  17,501  17,589  (88)  -0.5% 
- CCGT  16,584  15,684  900  5.7% 
- Fuel oil/gas  22,592  23,286  (694)  -3.0% 
Total  56,677  56,559  118  0.2% 
Net efficient nuclear capacity  5,370  5,351  19  0.4% 
Net efficient renewable capacity         
- Hydro  30,463  30,436  27  0.1% 
- Wind  5,200  4,394  806  18.3% 
- Geothermal  795  769  26  3.4% 
- Biomass and co-generation  134  160  (26)  -16.3% 
- Other  277  170  107  62.9% 
Total  36,869  35,929  940  2.6% 
Total net efficient capacity  98,916  97,839  1,077  1.1% 
Enel Open Data

Net efficient capacity by geographical area

MW     
 2013 2012 Change 
Italy  39,923  39,940  (17) 
Iberian peninsula  24,068  23,931  137  0.6% 
Latin America  17,155  16,794  361  2.1% 
Russia  9,107  9,052  55  0.6% 
Slovakia  5,399  5,400  (1)  -
North America  1,683  1,239  444  35.8% 
Romania  534  498  36  7.2% 
Belgium  406  406  - -
Greece  290  248  42  16.9% 
France  186  166  20  12.0% 
Morocco  123  123  - -
Bulgaria  42  42  - -
Total net efficient capacity  98,916  97,839  1,077  1.1% 
Enel Open Data

Net electricity generation by primary energy source

GWh     
 2013 2012 Change 
Net thermal electricity generation         
- Coal  82,388  91,729  (9,341)  -10.2% 
- CCGT  40,766  42,908  (2,142)  -5.0% 
- Fuel oil/gas  29,312  35,211  (5,899)  -16.8% 
Total  152,466  169,848  (17,382)  -10.2% 
Net nuclear electricity generation  40,591  41,378  (787)  -1.9% 
Net renewable generation         
- Hydro  74,344  68,139  6,205  9.1% 
- Wind  12,314  9,138  3,176  34.8% 
- Geothermal  5,581  5,492  89  1.6% 
- Biomass and co-generation  546  644  (98)  -15.2% 
- Other  304  194  110  56.7% 
Total  93,089  83,607  9,482  11.3% 
Total net electricity generation  286,146  294,833  (8,687)  -2.9% 
Enel Open Data

Net electricity generation by geographical area

GWh     
 2013 2012 Change 
Italy  72,897  74,436  (1,539)  -2.1% 
Iberian peninsula  74,614  81,727  (7,113)  -8.7% 
Latin America  65,712  65,916  (204)  -0.3% 
Russia  41,901  44,511  (2,610)  -5.9% 
Slovakia  21,343  20,720  623  3.0% 
North America  5,360  3,899  1,461  37.5% 
Romania  1,080  588  492  83.7% 
Belgium  1,373  1,183  190  16.1% 
Greece  566  476  90  18.9% 
France  362  364  (2)  -0.5% 
Morocco  852  906  (54)  -6.0% 
Bulgaria  86  83  3.1% 
Ireland  - 24  (24)  -100.0% 
Total net electricity generation  286,146  294,833  (8,687)  -2.9% 
Enel Open Data

Other generation ratios

 2013 2012 Change 
Generation from renewable resources (% of total)  32.5  28.4  4.1  14.4% 
Zero-emission generation (% of total) (1)  46.7  42.4  4.3  10.1% 
ISO 14001-certified net efficient capacity (% of total)  94.0  92.6  1.4  1.5% 
Average efficiency of thermal plants (%)  39.8  39.9  (0.1)  -0.3% 
Specific emissions of CO2  from net generation (gCO2/kWheq) (2)  391  418  (27)  -6.5% 
Specific water withdrawal (l/kWheq 0.64  0.62  0.02  3.2% 
Enel Open Data

(1) The 2012 figures have been restated in order to align them with the new method for recognizing energy generated in Latin America (which is measured at the point of delivery).
(2) Specific emissions have been calculated by taking account of the total emissions from simple thermal generation, combined electrical and thermal, as a ratio to the total generated by renewable sources, nuclear, simple thermal, and combined electrical and thermal generation (including the thermal contribution in MWh equivalent).

Customers by geographic area

Average no.     
 2013 2012 Change 
Electricity         
- Italy  27,819,881  28,032,500  (212,619)  -0.8% 
- Latin America  14,383,084  13,905,892  477,192  3.4% 
- Iberian peninsula  11,376,287  11,431,437  (55,150)  -0.5% 
- Romania  2,663,728  2,652,594  11,134  0.4% 
- Other countries  74,754  83,397  (8,643)  -10.4% 
Total electricity customers  56,317,734  56,105,820  211,914  0.4% 
Natural gas         
- Italy  3,245,996  3,158,532  87,464  2.8% 
- Spain  1,214,038  1,265,941  (51,903)  -4.1% 
Total natural gas customers  4,460,034  4,424,473  35,561  0.8% 
Enel Open Data

Safety rates

No.     
 2013 2012 Change 
Injury frequency rate  1.42  1.98  (0.56)  -28.3% 
Injury severity rate  0.07  0.10  (0.03)  -30.0% 
Serious and fatal injuries at Enel         
Serious injuries (1)  15  (8)  -53.3% 
Fatal injuries  - -
Total  13  15  (2)  -13.3% 
Serious and fatal injuries at contractors         
Serious injuries (1)  17  23  (6)  -26.1% 
Fatal injuries  10  11  (1)  -9.1% 
Total  27  34  (7)  -20.6% 
Enel Open Data

(1) Injuries with an initial prognosis, as reported on the medical certificate issued, of greater than 30 days, or with a confidential prognosis until the actual prognosis is released, or with an unknown prognosis that, based on an initial assessment by the company/division concerned, is expected to exceed 30 days. Once the official prognosis is released, the related injury is considered serious only if said prognosis exceeds 30 days. Should a confidential prognosis never be released or an unknown prognosis remain unknown, within 30 days of the event, the injury is to be deemed serious.

Other rates

No.     
 2013 2012 Change 
Average hours of training per employee  39.8  44.8  (5.0)  -11.2% 
Verified violations of the Code of Ethics (1)  27  41  (14)  -34.1% 
Enel Open Data

(1) In 2013, an analysis was performed of violations reported in 2012. As a result, there was a change in the number of verified violations reported for 2012 from 34 to 41

Creating value for stakeholders

Enel’s stakeholders are individuals, groups or institutions whose contribution is needed to achieve its mission or who have a stake in its pursuit.

The economic value created and shared by Enel gives a good indication of how the Group has created wealth for the following stakeholders: shareholders, lenders, employees and government.

Millions of euro   
 2013 2012 restated (1) 
Revenues  80,535  84,949 
Net income/(charges) from commodity risk management  (378)  38 
External costs  56,691  61,451 
Gross global value added from continuing operations  23,466  23,536 
Gross value added of discontinued operations  - -
Gross global value added  23,466  23,536 
distributed to:     
Shareholders  1,410  1,505 
Lenders  2,884  2,971 
Employees  4,596  5,789 
Government  4,211  3,910 
Enterprises  10,365  9,361 
Enel Open Data

(1) The 2012 consolidated income statement has been restated in order to better reflect the effects recognized in the previous year concerning the introduction of the IAS 19 Revised and the change in the method of recognizing environmental certificates.