About the report

Gazprom Neft is pleased to present its report on sustainable development activities (hereinafter – the Sustainable Development Report or Report) for 2016. The Report highlights the Company’s approach to sustainable development and social responsibility as well as the focuses and results of its work to meet production, economic, social and environmental objectives.

This is the Company’s ninth Sustainable Development Report. Gazprom Neft publishes its non-financial reports at the same time as its annual reports so it can present comprehensive coverage of its activities to solve economic, environmental and social problems in a strategic context.

For Gazprom Neft, preparing sustainable development reports is a tool of corporate governance and a significant component for stakeholder engagement. The Company believes it is essential to regularly provide stakeholders with comprehensive information about aspects of its activities that are significant for them and obtain feedback about the Report.

The 2016 Report is prepared in accordance with the basic version of Sustainability Reporting Guidelines – GRI-G4 – and taking into account the provisions of ISO 26000:2010 Adopted in the Russian Federation as GOST R ISO 26000-2012. (Guidance on Social Responsibility). The GRI index of standard disclosures and ISO 6000:2010 indicators are presented in Appendix 2.

The Report presents information about Gazprom Neft PJSC and its subsidiaries and affiliates (hereinafter referred to as Gazprom Neft or the Company) for the 2016 calendar year. The Company’s financial position and operating results are presented using consolidated data from Gazprom Neft PJSC. The Report draws on the management and audited financial accounts of Gazprom Neft PJSC drafted in accordance with International Financial Reporting Standards (IFRS). Unless otherwise indicated in the text, data on the Company’s social and labour relations and its environmental performance include figures for Gazprom Neft PJSC and its subsidiaries and affiliates based in the Russian Federation and the Commonwealth of Independent States (CIS).

The Report details the Company's medium- and long-term plans. This information is forward-looking in nature. The feasibility of the declared intentions depends on factors (economic, social, and legal) that are beyond the Company’s control or influence. The actual results may therefore differ from those indicated in the plans.

The Company employs the external assurance procedure for its Report to enhance the credibility of the presented information and to verify whether the approaches selected to highlight sustainable development matters are consistent with the principles of responsible business practices. In 201 6, the Report underwent independent public assurance by the Non-Financial Reporting Board of the Russian Union of Industrialists and Entrepreneurs (RUIE). Appendix 1.

The Report is published in Russian and in English.

Key themes and aspects of information disclosure

When managing sustainable development activities and reporting in this area, Gazprom Neft focuses on aspects that are the most significant for the Company and its stakeholders. The list of these significant aspects and themes defines the content of the Report.

When determining significant themes and the corresponding indicators, the Company took into consideration the provisions of the UN Global Compact, the Social Charter of Russian Business as well as the following standards and studies:

  • international and Russian standards in corporate social responsibility (CSR) and sustainable development and non-financial report standards (ISO 26000, GRI–G4, G4 Sector Supplement);
  • studies on the industry-wide practice for the management of sustainable development and reporting in this area;
  • an analysis of the scope of the Company’s stakeholder engagement.

Principles used to determine the content of the Sustainable Development Report:

  • materiality;
  • coverage of stakeholders;
  • context;
  • completeness;
  • balance;
  • comparability;
  • accuracy;
  • timeliness;
  • clarity;
  • reliability.

An analysis of the Company’s engagement with stakeholders was used to determine the themes and aspects that are significant for them as well as their materiality. The following was analysed in the process of identifying significant themes:

  • materials from a survey of employees (managers and specialists) as part of the preparation of this Report;
  • the results of employee feedback;
  • the results of an annual study of the Company’s social and psychological climate, minutes of meetings between employees and management, and team meetings;
  • materials from Gazprom Neft’s regular interaction with investors, the federal and regional authorities, business partners, non-profit and public organisations, experts and local communities;
  • materials from roundtables and public hearings in the regions;
  • recommendations and comments received by the Company as part of the public assurance of its 2016 Sustainability Report by the Non-Financial Reporting Board of the RUIE.
  • Dialogues with stakeholders in the regions where the Company operates are an important feedback channel for highlighting significant aspects and themes of the Report. The Company held such dialogues in Orenburg and Khanty-Mansiysk in 2016.
  • The roundtable ‘Sustainable Development of Gazprom Neft and Contribution to the Development of the Orenburg Region’ was attended by representatives of the subsidiary Gazpromneft-Orenburg, the Company’s corporate headquarters, the legislative and executive authorities, big and medium-sized business, the Russian Union of Industrialists and Entrepreneurs, the Chamber of Commerce and Industry, universities, public organisations and the media. The event focused on the following themes: the Company’s approach to doing business in the Orenburg Region, the main problems and results of activities in industrial and occupational safety and the implementation of the ‘Native Towns’ social investment programme in the region.
  • The roundtable held in Khanty-Mansiysk, titled ‘Activities of Gazprom Neft and Sustainable Development in the Company’s Regions of Operations’, was attended by representatives of the subsidiary Gazpromneft-Khantos, the Company’s corporate headquarters, the legislative and executive authorities of the Khanty-Mansi Autonomous District-Yugra, the Russian Union of Industrialists and Entrepreneurs, public and municipal organisations, Yugra State University and the media. The participants discussed the Company’s approach to doing business, the establishment of lean production and the implementation of the social investment programme in the Khanty-Mansi Autonomous District-Yugra.
  • The roundtables also included a discussion of the Company’s Sustainable Development Report for 2015 and the significant themes and aspects of the 2016 Report. The discussion revealed that the current structure of the Report takes into account the interests of various stakeholdersA list of issues that are significant for internal and external stakeholders is presented in the ‘Significant Themes and Aspects of the Report’ table. in a sufficiently balanced manner . At the same time, a number of the participants expressed wishes that were taken into account when preparing the Report for 2016. In particular, this Report provides wide-ranging information about the Company’s large-scale investment projects, its social policy in the regions as part of socioeconomic cooperation agreements and the development of the ‘Native Towns’ social investments program.
Significant Themes and Aspects of the Report The list includes themes that are significant for all subsidiaries.
Themes and aspects Priorities of internal stakeholders Priorities of external stakeholders Justification
Economic performance
Company’s strategy
Developing and implementing a flexible and competitive strategy taking into account internal and external stakeholders is key to the Company’s business stability and sustainability.
Investment programme
Large-scale investment projects in oil production and refining are among the Company’s key priorities and an important factor in achieving its strategic goals.
Financial stability
The Company’s financial stability enables it to meet its obligations to key stakeholders.
Production efficiency
Boosting production efficiency is a major factor in the Company’s competitiveness.
Product quality
Improving product quality helps to meet the growing demand among customers for enhanced attributes and strengthen the Company’s market positions.
Innovative activities
Developing and introducing innovations is an important factor for preserving the Company’s technological leadership and improving its competitiveness.
Industrial and occupational safety
Safety of production processes and emergency preparedness
The Company’s production activities are fraught with potential safety risks. Safe production and absolutely no harm to people, facilities and machinery is a key priority for Gazprom Neft.
Occupational health and care for employee health
Environmental safety
Industrial environmental monitoring
Industrial environmental monitoring and compliance with environmental legislation requirements are on the list of the Company’s environmental safety priorities.
Compliance with environmental legislation requirements
Environmental impact of the Company’s activities at the Prirazlomnoye field
The Company’s production activities in the Arctic region and, in particular, on the Prirazlomnaya offshore platform could potentially impact the Arctic environment, flora and fauna.
Utilising energy and energy efficiency
The production growth rates are due to the Company’s increased consumption of energy resources. To minimise the effect of this process, Gazprom Neft is working on improving energy efficiency and optimising the use of energy resources.
Sustainable use of natural resources
The Company’s activities impact the environment and natural resources: water, air and soil. The Company is committed to their sustainable use, restoration and protection.
Greenhouse gas emissions
Hydrocarbon production is fraught with the emission of harmful substances, in particular greenhouse gases.
Human capital
Equitable remuneration and social support for personnel
A competitive system of remuneration and social support is a highly important factor in attracting and retaining employees.
Employee training and development
Staff training and development provides the Company with skilled personnel in the present and future.
Labour relations and employment
Meeting obligations to employees and attracting and retaining the best specialists ensure stability in the Company’s work and is a key factor in achieving its strategic goals.
Company’s impact on the regions where it operates
Local community development programme
Gazprom Neft contributes to the socioeconomic development of the regions in which it operates as a participant in economic activities, employer, taxpayer and social investor.
Import substitution programme
The Company is actively working on import substitution and supporting domestic manufacturers, thus contributing to the development of the Russian and regional economies.
Local supplier development programme
Cooperation with local suppliers contributes significantly to developing the competitiveness of the economy and labour market in the regions where the Company operates.
Rights of indigenous peoples
The Company engages in activities in the territory of indigenous peoples of northern Russia.

The Company hopes to further develop a dialogue with stakeholders on matters concerning corporate social responsibility and sustainable development. We would appreciate feedback on these issues. You can contact us in any way you prefer using the information in the Contact Information and Feedback section.