Material topics and Stakeholder engagement

MATERIAL TOPICS

The KPO Sustainability Report is one of the important tools for building effective communication with stakeholders. The aim of this document is to raise awareness of stakeholders about material topics that impact both the organization and its stakeholders, and how they are resolved through engagement of the two.

KPO has been reporting to external stakeholders about its sustainable development since 2008. While working on this report we rely on extensive experience of our Parent Companies and follow the requirements of the recognized best practices in non-financial reporting.

The Sustainability reporting process involves exchange of information, collection of data and interdisciplinary communication both internally and externally.

For a number of years, we have identified a number of topics material for us and continue sharing their progress dynamics. In 2020, all the material topics previously covered in this report remained relevant. Figure 1 outlines all the topics.

We are guided by the Standards of the Global Reporting Initiative (GRI) as an instrument for defining boundaries of our material topics. 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 assessed, as well as set goals are quantified in comparison with achievements of previous periods.

Regardless of 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.

Considered in the Report material topics tend to address issues related to the economic, environmental and social impacts of KPO’s activities generally, as well as separately in the process of implementation of particular production operations. The Company’s interaction manifests both internal and external. The significance of material topics and their linkage between KPO and its stakeholders can be seen at the figure 2.

The topics disclosed for the reporting period are tracked annually in the process of multilateral interaction with the our Parent Companies, the PSA LLP Authority, various regulatory bodies, contractors, business 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, open days, audits, and social surveys and by direct addressing them to the Company.

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 for the last three years, there are loose-leaf feedback forms for readers to fill in. We have also placed an online feedback form on our website.

Fig. 1. Material topics of KPO sustainable development

Fig. 2. KPO engagement with stakeholders in 2020

STAKEHOLDER ENGAGEMENT

Success of sustainable development depends on effective dialogue of business and its stakeholders. We are bound with our stakeholders by multiple ties and are interested to hear their opinions.

The COVID-19 pandemic has significantly affected both the processes of interaction with stakeholders in terms of the dynamics of contacts and, accordingly, the volume of feedback received. In 2020, due to the limitations imposed by the COVID-19, engagement with many stakeholders was held online; some planned activities could not be implemented. Overall, the Company has successfully fulfilled all its operational plans including implementation of the expansion projects.

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 2020 are presented on the figure 2. The topics, which involved most stakeholder groups, are the COVID-19 and its impact on the KPO activities, health and safety, emergency response, asset integrity, industrial relations, environmental protection and compliance with environmental requirements.

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 on their own, and share their experience of engagement in this Report.

Feedback on the the issued Sustainability Reports is obtained using different channels, including telephone and e-mail communications through Sustainability@kpo.kz address, as well as KPO’s official website www.kpo.kz. All received comments and suggestions are reviewed in preparation of the next Report.