Definition of contents

The Hera Group introduced a new strategic approach to CSR and sustainability based on the theory of Shared Value (CSV, “Creating Shared Value”), which highlights how a company can enhance its business while generating at the same time a positive impact on society. For this reason, the 2017 sustainability report has adopted a new content structure which is focused on this approach.

In addition to quantifying shared value EBITDA, introduced for the first time in the 2016 sustainability report and whose calculation criteria were further improved during 2017, the report also focuses on the activities, results, case studies and investments related to shared value.

The CSV approach was defined starting from the analysis of the global and local scenario, which led to identifying 3 drivers and 9 impact areas of interest for the Hera Group. Each driver was associated with the main Sustainable Development Goals, which the Group intends responding to.

The report is divided into 3 main sections: Sustainability, strategy and shared value – Shared value – The bases and the organisational levers

The “Sustainability, Strategy and Shared Value” section contains the letter to the stakeholders (A year of sustainable development), the introduction (About us) and references with regard to sustainability management and shared value (Sustainability for the Hera Group – Shared value).

The “Shared value” section contains for each defined impact area, the present and future scenario (status indicators, policies and targets) and the Group’s responses: improvement objectives, performance indicators and case studies.

The “bases and the organisational levers” section contains all relevant corporate social responsibility aspects which were not included in the shared value section (Governance and creation of value – Service quality, cost and safety for customers – People – Suppliers). These must be considered as the basis for generating shared value and, at the same time, as organisational levers through which value be increased over time.

Reporting actions

In addition to the previously listed guidelines, the report was drawn up in compliance with a specific Group internal procedure issued in 2012 and updated in 2015 which describes the activities required for planning, achieving, approving, disclosing and presenting the report and the associated roles and responsibilities.

The social and environmental sustainability objectives set out in this report were defined with reference to the planning and control instruments used by the Group: Business Plan 2017-2021, budget 2018 and balanced scorecard 2018. These interconnected instruments contain sustainability objectives which have an impact on stakeholders. In particular, the Business Plan includes sustainability-related indicators for which quantitative targets have been defined. The collection and consolidation of the information and data detailed in the report were performed through forms, in which the technical indications used to detect the indicators were defined.

Any changes in calculations compared to previous years are suitably indicated in a note within the text.

Definition of contents

Sustainability reporting is preceded annually by the analysis and identification of  material topics for the stakeholders and for the Hera Group.

The process for defining the material topics is based on the analysis of internal and external documents which brings to light the most relevant sustainability topics related to the company’s activities which sustainability reporting must focus on.

The work of 6 HeraLABs, area laboratories or Local Advisory Boards in the areas of Bologna, Modena, Ferrara Imola-Faenza, Ravenna and Rimini, set up by the Group were analysed as well as the press review and the Group’s presence in social media, the annual customer satisfaction survey, and the biennial internal climate survey. The 2017 report also took into account risk analysis and analysis of the shared value scenario.

HeraLABs have the task of proposing initiatives to involve stakeholders and improve the sustainability of the services offered in the local areas, while verifying their efficacy periodically. In the first meeting, the Lab identifies the topics of relevance for the local areas by using the method set out in HeraLAB’s regulations. Initiatives are proposed on these relevant topics during the next meetings in order to improve their related impacts.

The topics set out in the report include those considered significant by the Sustainability Accounting Standards Board (SASB) for companies operating in the water, waste and gas sector (energy management, water consumption, distributed water quality, cost of water service, water network efficiency, climate change, greenhouse gas emissions, atmospheric emissions, fleet management, waste management, safety at work, industrial relations, waste recycling, energy efficiency and safety of gas service). The SASB is an independent US organisation that has developed standards for reporting significant sustainability information for single industrial sectors.

The topics that had a high relevance assessment (defined in terms of interest and conflict) in a widespread manner by the 6 HeraLABs (in which 69 stakeholder representatives took part) were:

  • attention to vulnerable users (across all areas);
  • waste treatment plant environmental impact;
  • efficiency and energy savings (with a growing trend especially in Ravenna);
  • area development (local suppliers);
  • separate waste collection (and reuse);
  • Solid Urban Waste collection: quality and costs;
  • district heating (reduction in Ferrara and increase in Imola-Faenza);
  • urban décor.

Regarding the press review analysis, the presence of information regarding the Hera Group was analysed on leading local and national newspapers by highlighting the topics that showed greater visibility (whether positive or negative) in more than one area (overall negative visibility index above 1,000 points or positive visibility index above 5,000 points). Regarding the study of blogs and social networks, the posts published on forums, blogs and social networks were analysed, in this case by highlighting visibility (weighted positive or negative visibility index above 10,000 points). The topics identified were: financial results and governance, environmental services (especially in Ferrara with introduction of the Quantity-Based Tariff), plants and water services.

The annual customer satisfaction survey assesses the quality of services offered and customers’ satisfaction with the Group. The survey also highlights the topics that are of particular importance in determining customers’ overall satisfaction. These topics area: the presence and level of branch services, online services and gas service safety and reliability.

The biennial employee satisfaction survey also draws attention, at Group level, to matters of major importance in determining employees’ overall satisfaction. The analysis conducted in 2017 highlighted the following important topics: remuneration, internal communication, relations with colleagues and coherence with values.

The following table summarises the aspects regarded as material by the overall analysis, the reason for their inclusion, the stakeholders on which they have an impact and company involvement (direct or indirect).

Hera Group Material Topics
Material Topics Why it is material Who it is material for Boundary of impact Type of impact
Sustainable management of water resources The Group manages water services Customers
Local community
Press review
Hera Lab
Risk analysis
CSV Scenario
Regulatory compliance
Group Direct
Transition towards a circular economy The Group manages waste management services and owns waste selection and recovery plants Local community
Press review
Hera Lab
Risk analysis
CSV Scenario
Regulatory compliance
Group companies that manage environmental services and waste treatment plants

Citizens residing in the territories served

Direct
Indirect
Promotion of energy efficiency and spreading renewable energy The Group manages energy services, owns energy production plants and some Group companies operate in the energy efficiency sector Customers
Local community
Press review
Hera Lab
Risk analysis
CSV Scenario
Regulatory compliance
Group

Customer of energy services

Direct

Indirect

Sustainability in the supply chain The Group outsources some activities to external suppliers, also assessing their social performance Local community
Press review
Hera Lab
Regulatory compliance
Group

Suppliers

Direct
Indirect
Local development and indirect economic impacts The activities managed by the Group (water, environmental and energy) generate significant indirect impacts. Furthermore, the Group has a widespread presence throughout the area. Local community
Press review
Hera Lab
CSV Scenario
Group

Suppliers

Direct
Indirect
Compliance with environmental and social regulations The Group manages waste management, water and energy services and owns waste disposal plants Furthermore, the Group companies employ over 8,500 workers and some activities are outsourced to external suppliers Local community
Hera Lab
Risk analysis
Regulatory compliance
Group Direct
Indirect
Quality, costs of waste collection and city integrity service This topic was considered relevant by the Hera Lab committees Local community
Press review
Hera Lab
Group Direct
Reduction of GHG emissions (climate change) The Group owns plants that generate atmospheric emissions Local community
Hera Lab
Risk analysis
CSV Scenario
Regulatory compliance
Group

Customers, suppliers

Direct
Indirect
Attention to users suffering economic difficulties The topic regarding users suffering economic difficulties was considered relevant during the Hera Lab committees Hera Lab
CSV Scenario
Group Direct
Safety and continuity of the service provided to customers This topic was considered relevant by customers, especially as regards safety of the gas service Customers
Hera Lab
Risk analysis
Regulatory compliance
Group Direct
Environmental impact of waste treatment plants (NIMBY syndrome) The Group owns waste treatment plants that generate atmospheric emissions Local community
Hera Lab
Risk analysis
CSV Scenario
Regulatory compliance
Group companies that manage waste treatment plants Direct
Indirect
Local community The Hera Group has a widespread presence throughout the area Local community
Hera Lab
Group Direct
Workplace health and safety This topic was considered relevant because Group companies employ over 8,500 workers Workforce
Hera Lab
Regulatory compliance
Workers Direct
Diversity, Welfare and internal climate This topic was considered relevant because Group companies employ over 8,500 workers Workforce
Regulatory compliance
Group Direct
Anti-corruption activities The presence of calls for tender, contracts and significant supply contracts is associated with anti-corruption issues Shareholders and financial institutions
Regulatory compliance
Group Direct
Economic value for the stakeholders Economic performance is essential for performing present and future activities Shareholders and financial institutions
Hera Lab
Group Direct
Commercial relations with customers through branch offices, call centres and the internet This topic is relevant for customers Customers
Hera Lab
Group

Commercial companies and call center service providers

Direct
Training and professional development, salaries and incentives This topic is relevant for employees Workforce
Hera Lab
Group Direct
Indirect

With respect to the issues in the 2016 sustainability report, there were no significant changes; no material topic was eliminated, but some were added or combined together. Specifically, the following issues were added: Sustainable management of water resources, Compliance with environmental and social regulations, Local community, Employment, Workplace health and safety, Anti-corruption activities, Economic value for the stakeholders.

The issue of the respect for human rights as set out in Italian Leg. Decree 254/16 is not regarded as material because the Group’s operational offices are located mainly in Italy and in any case not in countries considered to be at risk from this point of view. This evaluation also takes into account the information reported in the Suppliers chapter where the provenence of foreign supplies is detailed. It should be pointed out that four Group companies (Hera SpA, Hera Luce, Sinergie and AcegasAspAmga) were SA8000 certified in 2017, a voluntary standard that lists the requirements for ethically correct conduct towards workers and that focuses on the respect for human rights, especially the principles of decent work on the basis of ILO conventions.