Material topics and stakeholders engagement

Success of sustainable development depends on effective dialogue between business and its stakeholders. We are bound with our stakeholders by multiple ties and are interested to hear their opinions. The Sustainability report is the main tool for regularly informing stakeholders about our activities, including addressing key issues and related changes that impact one way or another both the Company and its stakeholders during the reporting period. In addition, the report presents the large number of indicators that allow us to analyze KPO’s impact on the development of the region as a whole. In working on this Report, we draw on the extensive experience of our Parent Companies and follow the requirements of internationally recognized non-financial reporting practices.

It is important for us to maintain a constructive dialogue with our stakeholders and implement mutually beneficial solutions. Decisions are usually made through the engagement process of the two. Our interaction with stakeholders is an integral part of the Company`s activities. It is planned, documented and carried out in accordance with the legislation and internal policies. KPO departments determine their stakeholders based on the analysis of risks and material topics, and share their experience of engagement in this Report. Given the scale of the KPO’s activities, our stakeholders are a large number of diverse groups and organizations. The most significant groups of stakeholders and ways of interaction in 2021 are presented on the figure 1.

The process of compiling our Sustainability report involves exchanging information and collecting data through interaction between various departments within the Company, as well as with stakeholders outside the Company. Over the years of reporting, we have identified a number of topics material for us, which are reviewed annually to highlight those that are most relevant and critical to our operations. In this issue, we continue to highlight their dynamics.

To define boundaries of our material topics, we are guided by the Standards of the Global Reporting Initiative (GRI) and their Standards for Oil and Gas sector. The most critical Key Performance Indicators are disclosed compared to those of the International Association of Oil and Gas Producers (IOGP). We report on the applicable GRI standards taking into account management approaches and Key Performance Indicators of the Company. At the same time, risk and opportunities are assessed, as well as set goals are quantified in comparison with achievements of previous periods.

Regardless of various standards` requirements, we do our best to provide more detailed information about the Company`s activities and material topics in sustainable development. Therefore, the information presented in the Report goes far beyond the GRI indicators alone.

Considered in the Report material topics tend to address issues related to the economic, environmental and social impacts of the KPO’s activities in general, as well as separately in the process of implementation of particular production operations.

The topics disclosed for the reporting period are tracked regularly in the process of multilateral interaction with our Parent Companies, the PSA LLP Authority, various regulatory bodies, contractors, industry partners, employees, trade unions, local communities and the media. The stakeholders raise their issues at various sessions, from meetings of the Village Councils to forums, conferences, public hearings, social surveys, audits, and by addressing them directly to the Company. (See Fig. 1) 

Fig. 1. KPO engagement with stakeholders in 2022

Fig. 2. Material topics of KPO Sustainable development

At the end of 2022, in order to identify the most material topics for disclosing in this issue, we have conducted a survey amongst the key stakeholders. The survey was answered by 83 % of respondents. This survey has helped us to analyze our reporting process and to prioritize our list of material topics.

In 2022, all of the topics listed in Figure 2 remained material to KPO and its stakeholders. The importance of the topics is shown in a ranking from 0 to 4, from the centre to the outer edge of the diagram. The most significant topics are outside of the red circle, indicating a threshold value of three, and include those listed in Table 1.

Tab. 1. Comparison of the most material topics according to the Key stakeholders' opinion surveys for 2021 – 2022

Based on the results of the surveys and the knowledge gained by the reporting team at the certified training on the updated 2021 GRI Standards, we conducted another analysis of the material topics list. Compared to 2021, the list of material topics decreased from 35 to 32. Of these, two topics: corporate governance and ISO 14001, 45001 and 50001, 9001 certification, which we separately identified as material, are compulsory for disclosure according to GRI among general disclosures on organization activities and will be covered in subsequent reports by default. One topic – COVID 19 – has ceased to have a major impact on the company’s operations.

The degree of relevance of certain issues disclosed in this Report can be traced in figure 2.

At the end of 2022, we also conducted an internal survey among our employees to assess the relevance of the information covered in the report for their work. 7 % of the Company’s staff took part in the survey. Based on the survey results, we identified six most-read chapters.

The result of this survey also confirms the importance of HSE, asset integrity and personnel development topics. At the same time, environmental protection topics continue to be important for KPO staff, unlike the results of the external stakeholder’s survey.

As part of the Report’s preparation, we aim to continuously raise public awareness of the material topics disclosed in the Report, both internal and external. Inside the printed copies of our Sustainability Reports there are loose-leaf feedback forms for readers to fill in. We have also placed an online feedback form on our website and we are always open for the feedback on the Report in any form via Sustainability@kpo.kz. The comments and suggestions received are taken into account in the preparation of the next Report.

Graph 1. The most popular chapters of the report