The concept of environmental, social and corporate governance (ESG) encourages companies to think strategically and plan for the long term. The key stakeholders are the company’s employees and the local population, customers, investors, public organizations, and the state as a whole. This is the simplest and clearest explanation of what ESG is for a modern company interested in the long-term and sustainable development.
This concept came from Europe and for Russian companies, it is a new vision of the development. The study of this issue showed that the ESG concept brings a lot of benefits to the company and the appearance of the ESG concept is determined integrally both by time and the state of the economy. The value of major manufacturing companies on the global economic map is enhanced due to the transition to an integrated perception of tasks and a holistic vision when companies are in harmony with the outside world. The ESG concept is based on the principles of ethics observed by large-scale companies in Europe and the world. Russian companies are also in line with them thanks to the observance and implementation of the ESG criteria in their governance and development.
Companies compare their development indicators with those of their competitors, comply with the requirements of international standards and increase their status on the global economic map in this way. Areas of potential improvements are identified and implemented and long-term goals for ten, twenty years ahead are set. These plans take into account environmental and climate change issues in six areas like climate change, air, water, tailings and waste, soil, and biodiversity. The plans to achieve goals are specified and the transparency of reporting increases. The results begin to exist not only on paper, but also in reality.
Every year, companies hold discussions on the implementation of the ESG activities specified in corporate policies and policy statements.
These include the climate change policy, biodiversity policy statement, water management policy statement, tailings management policy, human rights policy, updated responsible sourcing policy and supplier code of conduct, as well as the stakeholder engagement policy.
The purpose of discussing these conceptual documents in the regions where companies operate and at the federal level is to collect comments and suggestions from various stakeholder groups to take into account the public expectations and to effectively plan the implementation of new policies with their subsequent introduction in the corporate culture and practice.
Such discussions contribute to optimizing the companies’ activities in the implementation of the ESG policy and in their sustainable development and also prevent adverse impacts on the environment and society.
Norilsk Nickel is a Russian mining and metallurgical company and the world’s largest producer of nickel and palladium. The value of the Nornickel’s activities for the Russian economy is undeniable. Everyone understands that these metals are not only rare and valuable, but are used in various areas of industry.
The conscious transition to the use and implementation of the ESG concept in its management and production policy indicates that Norilsk Nickel is interested in the company’s long-term development. Any changes, restructuring efforts, transformations can cause turbulence at the stage of the initial changes and can lead to a slight decline in its performance, but in the long run, they will strengthen the company and allow it to thrive for many years. It is important to understand these processes and treat them calmly and without emotions, as stages of the entire process.
Norilsk Nickel has set strategic development goals for the period up to 2030. It is expected that the achievement of these goals will ensure Norilsk Nickel’s global leadership.
The policy in ecology and climate change provides for the application of best practices in compliance with the company’s environmental responsibility. As part of the strategy development, promising programs for detailed study were identified including the waste balance and disposal, options for the use of gypsum.
Changes have also taken place in the corporate governance: the organizational structure has been changed to support processes, and a system of long-term motivation for 2021-2023 has been introduced. New governance processes are introduced, reporting is changed, the changed requirements of ICMM, IRMA are implemented, the TCFD’s reporting standards and GHG Protocol are observed.
Norilsk Nickel holds open public hearings on the company’s policy in ESG with the representatives of public, ecological and environmental organizations, as well as regional nature reserves.
At such meetings, the company presents its work plan in the environmental, social and corporate governance spheres. Thus, Nornickel receives feedback and can respond to the information received to save the company from unjustified criticism and show that it operates openly.
Thanks to such discussions, the trust in the company increases when the residents and the representatives of public organizations understand that any issue can be discussed openly. The public also sees that Norilsk Nickel is interested in maintaining environmental health in the regions of its operation.
During the event, the participants are given various documents like the Nornickel’s corporate strategy on ecology and climate change until 2031, a prevention program or a draft corporate grievance mechanism and handling complaints. Questionnaires are always provided.
The company draws the listeners’ attention to the fact that all the regions of the company’s presence are important for Norilsk Nickel and the company guarantees the preservation of pure water and air, as well as the diversity of flora and fauna. “Our goal is the peaceful coexistence of nature and humans. Of course, any human industrial activity has an impact on the environment, but our task is to make sure that the impact is not negative,” said Stanislav Seleznyov, Vice President of Norilsk Nickel for Environment, at one of the public hearings in June 2022.
Public discussion of the company’s policy is the first in the list of key events in the ESG agenda. Similar meetings took place in Murmansk and are planned to be held in Norilsk and Chita.
“Public discussions are a set of measures aimed at informing the public about the company’s planned economic and other activities, and its possible impact on the environment to identify public preferences and take them into account in the impact assessment process. The final versions of the assessment data are used in the preparation of supporting documentation and are submitted as part of it for the state environmental review,” explained Anna Popovich, Acting Chief Manager of the Medvezhy Ruchey (Bears’ Creek) Engineering Department.
Every time a new facility construction is planned or an expansion of the existing one is planned and the issue is offered for public comment. For example, a project involves the construction of a new gas pipeline. The construction of several related facilities may be planned including a gas pipeline (total length of over 17 km), power transmission lines (21.5 km), two main step-down substations with a total nominal capacity of over 55 megawatts, modular gas-fired hot water boilers with a total capacity of 30 megawatts, and a mine water pumping and treatment complex. The purpose of the construction is to bring the company to a maximum ore output of nine million tons per year. Prior to work, a hearing notice is given to discuss the construction issues with the people living in the area.
Hearings are held openly, the venue is announced in advance, and all the residents of the region can take part in these public discussions of the technical solutions of the project to be implemented.
In total, nineteen public hearings have been held from 2021 to 2022. The topics discussed include, among others, as follows:
Public discussions of the object of the state environmental expert evaluation (engineering documentation): “NMZ. KS-1. Capital construction of ASU with a capacity of 40,000 cu.m/h, application of vacuum pressure swing adsorption”, including preliminary environmental impact assessment data.
Public discussions of the object of environmental expert evaluation “Enterprise ‘Unified Warehouse’, Base TMIO No. 2, TPTs-1. Construction of a facility to accommodate a shop for the processing of non-ferrous scrap, including preliminary environmental impact assessment data.
Public discussions of the object of environmental expert evaluation “Integrated development of the Oktyabrsky mine”. Surface Backfilling Complex No. 2 (PZK2)”, including preliminary environmental impact assessment data.
Public discussions on the engineering documentation of PJSC MMC Norilsk Nickel. Polar Branch. Copper Plant. Utilization of sulfur dioxide. Existing networks. Code: MZ-UDS (KP-SP), including preliminary environmental impact assessment data, and questionnaires.
Public discussions on the engineering documentation of PJSC MMC Norilsk Nickel. Polar Branch. Copper Plant. Utilization of sulfur dioxide. Railway tracks No. 14 and No. 15. Code: MZ-UDS (KP-SP), including preliminary environmental impact assessment data, and questionnaires.
Public discussions on the engineering documentation of PJSC MMC Norilsk Nickel. Polar Branch. Copper Plant. Utilization of sulfur dioxide. Heating supply systems. Code: MZ-UDS (KP-SP), including preliminary environmental impact assessment data, and questionnaires.
Public discussions on the engineering documentation of PJSC MMC Norilsk Nickel. Polar Branch. Copper Plant. Utilization of sulfur dioxide. Heat recovery systems. Code: MZ-UDS (KP-SP), including preliminary environmental impact assessment data, and questionnaires.
Public discussions on the engineering documentation of PJSC MMC Norilsk Nickel. Polar Branch. Copper Plant. Utilization of sulfur dioxide. Sulfuric acid production. Code: MZ-UDS (KP-SP), including preliminary environmental impact assessment data, and questionnaires.
Public discussions on the object of the state ecological expert evaluation: engineering documentation of PJSC MMC Norilsk Nickel. JSC Kola MMC. Construction of the complex “Roasting - Leaching -Electroextraction”. Construction Stage 2. Preparation of raw materials”, including preliminary environmental impact assessment data.
Public discussions on the object of the state ecological expert evaluation: engineering documentation of PJSC MMC Norilsk Nickel. JSC Kola MMC. Construction of the nickel matte separation department. Construction Stage 3. On-site networks”, including preliminary environmental impact assessment data.
Public discussions on the object of the state ecological expert evaluation: engineering documentation of PJSC MMC Norilsk Nickel. JSC Kola MMC. Construction of the nickel matte separation department. Construction Stage 4. Main production facilities”, including preliminary environmental impact assessment data.
Public discussions of the object of state environmental expert evaluation (engineering documentation): “MZ. Technical re-equipment of oxygen intake from Oxygen Station No. 1”, including preliminary environmental impact assessment data.
Public discussions on the object of the state ecological expert evaluation: engineering documentation of PJSC MMC Norilsk Nickel. JSC Kola MMC. Construction of the nickel matte separation department. Construction Stage 1. ABK. Container Yard”, including preliminary environmental impact assessment data.
Public discussions on the object of the state ecological expert evaluation: engineering documentation of PJSC MMC Norilsk Nickel. JSC Kola MMC. Construction of the complex “Roasting - Leaching - Electroextraction”. Construction Stage 1. Administrative building, container yard”, including preliminary environmental impact assessment data.
Before each meeting, the information about the venue and time of the discussions is published in advance.
Each hearing is held in accordance with Federal Law of the Russian Federation No. 174-FZ “On Environmental Expert Evaluation” dated November 23, 1995, and the Requirements for Environmental Impact Assessment Data approved by Order of the Ministry of Natural Resources of Russia No. 999 dated December 1, 2020.
The information provided is based on data available to PJSC MMC Norilsk Nickel (dubbed as Norilsk Nickel, or Nornickel, or NN) at the time of writing this article.
V. E. Koptev-Dvornikov, Prof., HSE University, for Rough&Polished
