About the Report

G4-28, G4-29,
G4-3, G4-30,
G4-23, G4-32,
G4-15, G4-18,
G4-19, G4-20,
G4-21, G4-27

PJSC LUKOIL presents the seventh Sustainability Report prepared for the period from 01.01.2015 to 31.12.2016. The document comprehensively reflects economic, environmental, and social results of our activities. The Company has published Sustainability Reports since 2005. The previous Report was published in autumn 2015 (for the period from 01.01.2013 to 31.12.2014). G4-28, G4-29, G4-3

Up until the 2016 reporting year inclusive, the Company The words LUKOIL, Company, Group, the LUKOIL Group in this document mean PJSC LUKOIL and its subsidiaries and affiliates. published its reports every second year. In order to increase the relevance of the information provided and in accordance with the recommendations of the Council on Non-Financial Reporting of the Russian Union of Industrialists and Entrepreneurs following public confirmation of the previous report, the Company intends to move to an annual reporting cycle in 2017 and expand the reporting boundaries by including foreign assets in the scope of the Report. G4-30, G4-23

LUKOIL uses to the following documents and guidelines when preparing reports: G4-32

  • Sustainability Reporting Guidelines under the Global Reporting Initiative GRI G4 (the main level of compliance). General Standard Disclosures and specific standard disclosures under GRI G4 are included in GRI Conformance Table;
  • UN Global Compact; G4-15
  • Social Charter of Russian Business, Core Performance Indicators (CPI). G4-15
Download appendix on the Report Starting from 2017, the Company is moving to an annual reporting cycle and extending its boundaries
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The Company publishes its non-financial reports

to inform stakeholders of the key areas of its activity and economic, social, and environmental results from the point of sustainable development of the Company and society.

The Company is guided by АА1000 SES (2015) standard when convening dialogues (round-table discussions) with the external stakeholders. The LUKOIL Group consolidated financial statements have been drawn in accordance with IFRS since the 2015 Statement (under US GAAP previously).

A standard process of identification of material aspects in the course of preparing of non-financial reporting includes study of the following sources: G4-18

  • topics raised by the Company’s leadership and top-managers in the framework of public appearances and presentations in Russia and abroad;
  • publications about the Company in the major business, and social and political media, as well as in the Internet media;
  • reports of Russian and foreign oil and gas comparable companies;
  • analysis of significant events in the industry within the reporting period;
  • interview of the heads of LUKOIL’s key structural subdivisions (conducted from time to time);
  • the content of dialogue with stakeholders in Russian regions of the Company’s presence (1–2 dialogues annually, with an average number of participants of 30–50 per dialogue).

In 2016, the process was supplemented by conducting a survey of business partners of the Company’s subsidiaries operating in Russia.

Based on the results of a comprehensive analysis, the following themes have been identified as significant. G4-19, G4-20, G4-21, G4-27
Comparison with GRI Aspects
[G4-19]
Material aspects of the Report
[G4-27]
Significant for outside audience
[G4-20]
Significant for outside audience
[G4-21]
Report Sections

Economic category

  • Economic performance
  • Indirect economic impact

Social category

  • Product responsibility

Industrial application

  • Reserves

Environmental category

  • Energy

Economic
Capital investments, including those for the modernization of power generating facilities and oil refineries. Plans to construct new production facilities and expand current ones

About the Company (General information).

Sustainable Development of the Russian Regions and corporate responsibility practices in foreign assets

Development of fields at mature stages, as well as extraction of hard- to-reach and hard-to-recover reserves

Sustainable Development of the Russian Regions and corporate responsibility practices in foreign assets

Energy sources, including renewable

About the Company (General information. Power Engineering)

Innovative Policy

About the Company (General information. Development of Technology).

Sustainable Development of the Russian Regions and corporate responsibility practices in foreign assets

Procurement practice with Russian organizations and engagement in small entrepreneurship development programs

Community (Development of social entrepreneurship)

Fuel and Products: quality, meeting clients’ demands, customer satisfaction at filling stations

About the Company (General information. Trade and marketing)

About the Company (Interaction with Stakeholders)

Social Category Labor practices and decent work:

  • Health and on-site safety

Environmental category

  • Water
  • Emissions
  • Discharges and waste
  • Biodiversity
  • General information (Investments in Environmental Protection)

Environmental
Industrial Safety

HSE (Industrial Safety)
Personnel (Health and On-Site Safety)

Implementation of Environmental Policy. Impact on the main environmental components: air, water, and soil

HSE (Management Approach; Management System; Environmental Safety Program)

Greenhouse gas emissions and climate change

HSE (Environmental Safety Program)

Development of offshore fields

HSE (Biodiversity preservation)

The impact of industry on the environment in the territories of operation and public health

HSE. Community.

Sustainable Development of the Russian Regions and corporate responsibility practices in foreign assets

Oil spills
HSE (Emergency prevention and response)

Social Category

Labor practices and decent work:

  • Employment
  • Employee-Employer relations
  • Training and education
  • Diversity and equal opportunities
  • Equal remuneration for female and male employees
  • Grievance mechanisms in regard to labor practices

Human Rights:

  • Prevention of discrimination
  • Freedom of association and collective negotiations
  • Child labor
  • Forced or compulsory labor
  • Rights of indigenous peoples/ minorities
  • Grievance mechanisms in case of human rights violations

Community:

  • Local communities
  • Anti-corruption
  • Government Policy
  • Anti-competitive behavior
  • Compliance

Economic category

  • Market presence

Social
Personnel policy, social policy with respect to employees

Personnel (Personnel Policy; Incentives and Remuneration; Training; Youth Policy)
About the Company (Ethics)

Cooperation with universities on personnel training
Community (High quality industry-specific education)
Cooperation agreements with RF regions, improvement of social climate in the regions of presence

Community (Social Investments),

Sustainable Development of the Russian Regions and corporate responsibility practices in foreign assets

Charity Policy, Social and cultural projects contest

Community (Social Investments),

Sustainable Development of the Russian Regions and corporate responsibility practices in foreign assets

Human Rights

Personnel (Management approach; guarantees of employee labor rights and human rights)
Community (Interaction with the indigenous minorities of the North)

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