Fingrids operations have a direct impact on the well-being of Finns. We understand how significant our work is for society and how important it is to ensure the responsibility of our business practices. For us, corporate responsibility means that in securing a reliable supply of electricity for society, we are also taking care of people and the environmental impacts of our operations, and complying with good governance practices.
Fingrids strategy and its various perspectives form the starting point for our corporate responsibility work. Corporate responsibility is a key element in the implementation of our strategy and in our business expertise. By operating responsibly in all areas of sustainability we can best bring value to our stakeholders and ensure the acceptance of our projects by society.
We manage corporate responsibility as an integrated part of Fingrids management system. Corporate responsibility is a systematic, targeted component of our basic operations and annual cycle of management. Corporate responsibility is part of our planning of operations and an integral, strategy-based component when we assess development opportunities and risks and devise measures for the subsequent year. Corporate responsibility risks are part of our risk management.
Fingrids Board of Directors approves the companys Code of Conduct and monitors the companys compliance in operating responsibly. The Board is responsible for the CSR management systems and their integration into business operations. The CEO and the heads of functions are each responsible for corporate responsibility issues within their area of responsibility. Alongside profitability issues, social issues and environmental impacts are taken into account in a well-balanced way in all decision-making and when assessing operations. Corporate responsibility is co-ordinated at the company level by the steering group for Fingrids finance and business development perspective, which is headed by the Chief Financial Officer. The steering group is supported by the companys business development working group, which is composed of development managers. A development manager is appointed to co-ordinate corporate responsibility work.
Each Fingrid employee commits to abiding by our common values and our Code of Conduct, which we have updated taking into account the renewal of our corporate culture. Our Code of Conduct is based on the United Nations Global Compact initiative and the principles guiding business operations and human rights. Our managers and the entire work community ensure that behaviour is in line with the Code of Conduct. A whistle-blower system managed by an independent third party is also available to personnel for reporting possible misconduct etc. We help new employees assimilate the Code of Conduct through online orientation.
Fingrid committed in 2016 to the United Nations Global Compact initiative. Our Code of Conduct is in line with the principles of this leading corporate responsibility initiative on human rights, labour, environment and anti-corruption. Our commitment to a voluntary global initiative further strengthens the strategic and operational integration of corporate social responsibility in our operating methods and supports the co-operation with agreement partners in promoting CSR. We require our contract partners to commit to our corporate responsibility requirements, and we monitor their fulfilment through a risk-based approach. We are likewise prepared to commit to the corporate responsibility requirements set for Fingrid by our contractual partners.
Responsible procurement practices play a key role in our business model based on outsourcing. We ensure that we meet our obligations to investigate and our responsibility when using external workforce. Grid infrastructure construction and maintenance is subject to competitive bidding, and our work sites around Finland employ competent workforce also from abroad. We audit our work sites to verify compliance with contractor obligations, occupational safety and environmental management. The audits carried out during 2016 proved that the operations at our work sites are generally at a high level and that use of the electronic reporting system is extensive. The development areas identified in the altogether 15 audits performed were typically related to risk assessment and documentation. The progress made in rectifying them was monitored in work site meetings.
We performed seven corporate responsibility audits related to our international procurements. In three of these, our experts audited our direct contractual partners and the other audits were conducted by a third party. In addition, we performed one sub-supplier audit jointly with our direct contractual partner. The most important non-conformities identified during the audits were related to the working hours and pay of subcontractors, chemicals storage and the use of personal protective equipment, identification of environmental risks and proactive measures. We addressed the shortcomings in accordance with the action plans drawn up by the suppliers and achieved concrete improvements in the responsibility of our supply chain.
In order to ensure the transparency and comparability of our operations, we have reported on our corporate responsibility in accordance with the international Global Reporting Initiative (GRI) framework since 2011. We apply the GRI G4 reporting framework using the Core in accordance option. The matters we have prioritised are presented in the figure, and our reported data is compiled in a GRI Content Index .
Human rights and the tax footprint continued to be current corporate responsibility topics in 2016. To ensure we understand our impacts on human rights, we made an assessment in compliance with the due diligence process recommended in the UNs Guiding Principles on Business and Human Rights. Based on the assessment, we updated our Code of Conduct and corporate responsibility requirements and made Fingrids human rights commitment a part of our Code of Conduct. We ensured that our personnel practices meet the human rights responsibility and developed further our operating models for informing and engaging landowners in power line projects. We also published a new brochure where we answer landowners frequently asked questions concerning power line construction.
As regards tax footprint reporting, Fingrid only operated in Finland and did not make any special arrangements to minimise its taxes. Our tax footprint is presented in the annual reports Corporate finances, financing and risk management section. Dividends are mainly paid to the State of Finland and to Finnish pension and insurance companies. The Social Enterprise Mark granted to Fingrid by the Association for Finnish Work bears testimony to Fingrids responsibility in handling its socially important task.
Key events of 2016
Impact of Fingrid’s operations on the UN Sustainable Development Goals
In 2016, we defined how Fingrids operations are linked to the UN Sustainable Development Goals published in 2015. Of the 17 goals, we contribute especially to the following:
- Affordable and clean energy. We secure reliable electricity and affordable grid transmission pricing for society. Societys demands for a reliable electricity supply are increasing and serious disturbances in electricity supply are the greatest safety threats. Our investment programme improves the reliability of electricity transmission. We also secure a well-functioning electricity market and we are forerunner in electricity market services.
- Industry, innovations and infrastructure. We maintain and develop vital electricity transmission infrastructure for the needs of our customers and society. The extensive investments included in our grid development programme create jobs worth hundreds of man-years of labour for our service providers. We are actively engaged in international co-operation and innovation, developing future technologies for our sector.
- Climate action. The transformation in the structure of electricity generation due to the efforts to mitigate climate change results in changes in the electricity system. We make it possible to connect new forms of energy production to the grid. We ensure the sufficiency of system reserves also in the future and prepare for a decline in flexible production capacity while at the same time developing the electricity market to meet the needs of a carbon-neutral electricity system. We minimise power losses that have a climate impact in our electricity transmission.
Our business also supports the following UN Sustainable Development Goals:
- Gender equality. We treat everyone with respect and fairness in accordance with Fingrids Code of Conduct and we ensure equal ways of operating for both genders.
- Decent work and economic growth. We do our part to promote technology renewal, innovation and resource efficiency. We want to be one of Finlands greatest workplaces, with a thriving work community as our pillar. We promote responsible business practices throughout our supply chain.
- Responsible consumption and production. We ensure sustainable consumption and practices in our own operations and strive to set an example for others. In our power line projects, we primarily utilise existing right-of-ways. We recycle the waste of our work sites almost to 100%.
- Life on land. We want to reduce the harmful effects of our power line projects on biodiversity, landscape and land use. We encourage our service providers and suppliers to commit to environmentally responsible practices.
- Partnerships for the goals. As a transmission system operator, our operations impact many stakeholders and interaction for the benefit of customers and society is important. We combine our core competence with the best players and promote sustainable development and responsible practices globally through our procurements. We engage in international co-operation networks and sectoral co-operation as well as in research and development and school partnerships. We promote public-private partnerships. Fingrid is a member of the Ministry of Economic Affairs and Employments smart grid working group, whose mission is to look into the opportunities smart grids can offer the electricity markets.