Industry Reporting Guidance Improves Sustainability Performance
Posted November 6, 2020
The natural gas and oil industry has advanced sector-wide guidance for sustainability reporting for over fifteen years, reinforcing its longstanding commitment to energy and environmental progress.
Earlier this year, three international natural gas and oil industry associations – API, IPIECA and IOGP – released an updated version of the “Sustainability Reporting Guidance for the Oil and Gas Industry,” which provides a common framework for assessing environmental, social and governance (ESG) issues.
In September, IPIECA released the results of its annual reporting survey, identifying widely used performance indicators and emerging trends. The findings, which include answers from 27 of the world’s largest energy companies, highlight the progress of industry leaders and partner organizations.
IPIECA’s survey found:
- 89% of respondents use the IPIECA-API-IOGP Sustainability Reporting Guidance to direct the development of their annual reports.
- 92% report to, or reference, the United Nations Sustainable Development Goals (SDGs).
- 75% engage with investors and ESG rating agencies to identify topics for inclusion and request feedback.
- 81% supplement their reporting with communications on specific topics, including the risks of climate change.
- 92% say climate change mitigation will be the most important sustainability topic in the next three to five years.
The results indicate increasing industry stewardship of ESG, including climate, issues as well as an interest in sharing best practices and elevating the industry’s performance and its contributions to sustainable development. Comprehensive reporting strengthens business transparency and corporate citizenship, supporting broader industry-led efforts to reduce emissions and develop climate solutions.
On the release of the updated reporting guidance in March, API President and CEO Mike Sommers said:
“This guidance helps provide detailed reporting on environmental, health, safety, social and economic performance – critical information that helps to foster collaboration with a wide range of stakeholders focused on creating a significant turning point in meeting the challenge of climate change head on.”
A unified perspective on ESG issues among the natural gas and oil industry is valuable, since the term represents a wide range of programs that energy businesses have been managing for decades. The bottom line is that companies have processes in place to manage the risks and opportunities associated with climate change, safety and sustainability, which enhance community relationships and partnerships with the financial sector.
As API’s Manager of Climate and ESG Policy Dr. Aaron Padilla explained, API and its member companies are taking action to reduce greenhouse gas emissions by coordinating private-sector initiatives, engaging on government climate policymaking and investing in advanced technologies – like carbon capture, utilization and storage (CCUS).
Dr. Padilla added:
“There’s widespread recognition [by] the natural gas and oil industry that we need to do our part to reduce greenhouse gas emissions associated with our operations. There are many opportunities and activities that individual companies highlight in their own reporting on this.”
The natural gas and oil industry is essential to our energy future, and robust reporting efforts support continuous performance improvements and the ongoing delivery of affordable, reliable and ever-cleaner energy – in the U.S. and around the world.
For more stories showcasing industry leadership on environmental and social performance, see here.
About The Author
Sam Winstel is a writer for the American Petroleum Institute. He comes to API from Edelman, where he supported communications marketing strategies for clients across the firm’s energy and federal government practices. Originally from Dallas, Texas, Sam graduated from Davidson College in North Carolina, and he currently resides in Washington, D.C.