Mapping Our Sustainability Risks

Threat:
Loss of integrity of a pipeline due to causes like pressure control systems failing or annular gas migration as a result of poor cementing of surface casings, resulting in a major accident (explosion, major fire, major oil spill). This would lead to a major oil spill event, production stoppage, and reputational damages.

• Process safety measures and maintenance
• Emergency preparedness measures and maintenance
• Training of staff

For more information, see Process Safety and Spills.

Threat:
Property damage offshore or onshore caused by various risks outside normal operations or normal maintenance, such as fires and explosions. Risks such as integrity failure or unsafe process safety conditions would lead to business interruption, pollution, harm to employee safety, and reputational damage.

• Audits (internal and third party)
• Preventive maintenance
• Inspections
• Rejuvenation Program (plant improvement projects)
• Planned turnaround
• Qualified and trained personnel

For more information, see Process Safety.

Threat:
The impact of periods of low or no precipitation on surface or subsurface water supplies would lead to the inability to access water for normal operations (internal consumptive use) and for local communities in areas of low water availability.

• Integrity improvement through old water pipeline/facility replacement programs, preventive maintenance, water management plans, reduced water consumption, and water efficiency improvements
• Water management is a key component of our social license to operate. We engage and cooperate with local communities, and act as a responsible partner. OMV’s water management activities pursue socially equitable water use.

For more information, see Water.

Threat:
Risk of soil and water contamination due to improper waste management; this could be triggered either by the failure to comply with internal regulations by employees, suppliers, and contractors or by the failure of asset integrity.

• Improved waste management
• Training of staff

For more information, see Waste.

Threat:
Non-compliance with environmental, emissions, and water laws or internal rules and regulations caused by unexpected changes or different interpretations of the legislation. This would lead to additional OPEX or CAPEX needed to upgrade facilities or extra taxes having to be paid.

• Engagement with regulators to ensure laws are correctly interpreted and upheld
• Process safety measures and maintenance
• Training of staff
• Implementation of best available technologies

For more information, see Environmental Compliance.

Threat:
Abuse of entrusted power for individual unlawful gain/advantage, personal interest prevailing over company interest, or other forms of unethical business conduct could lead to reputational damage and pecuniary losses as well as criminal consequences in isolated cases.

• Implementation of Compliance Management System

For more information, see Business Principles and Anti-Corruption.

Opportunity:
OMV enhances local safety regulations by requiring the integration of best practice HSSE aspects in all phases of the life cycle of contracts and contractor management.

• Improving the HSSE performance of OMV contractors through, e.g., HSSE requirements in the scope of work, HSSE prequalification of contractors, HSSE requirements in annexes to contracts, audits, HSSE induction, joint HSSE trainings, joint HSSE walks, inspections, etc.

For more information, see Occupational Safety.

Threat:
Risk of poor labor practices in supply management such as the failure to pay decent wages in the supply chain (human rights). The supplier pays wages below standards established by international human rights bodies (e.g., 60% of the national net average earnings of a full-time worker).

• Human Rights Country Entry Check before launching operations in a country as well as regular human rights assessments in our countries of operations including labor rights aspects
• Training for employees (focus on high-risk countries)
• HSSE contractor management considers human rights aspects (including labor rights) in the prequalification and auditing phase
• ESG supplier assessments
• Code of Conduct including labor rights

For more information, see Human Rights and Supply Chain.

Threat:
The industry is bracing for a serious shortfall of experienced technical professionals over the next several years due to attrition and retirement. The risk is as much about the number of workers retiring as it is about those ready to replace them. The lack of professional trade schools and the limited number of universities with oil and gas programs contribute to the low number of skilled graduates to replace professionals currently working.

• Developing new projects in order to prepare young students for trade schools in various specialties in the oil and gas industry

For more information, see Skills Management and Employee Development.

Threat:
Risk of not attracting and/or failing to retain competent staff in countries where acquiring and retaining skilled mid-career staff is a challenge.

Notice periods and common practice in some countries lead to staff leaving the organization quickly.

Lack of motivation, lack of engagement, and the risk of losing talented professionals following the increasing pressure to reduce costs on learning and development projects.

• Ensuring competitive compensation and benefits by continuously monitoring market trends and international best practices. A new Group-wide recruiting standard has been implemented to ensure a high-quality recruitment process in order to attract top professionals.
• Strengthening the culture of feedback and increasing training for leaders

For more information, see Skills Management and Employee Development.

Threat:
Failure to reach the Group diversity target increases the risk of losing female top talent.

• Increasing the proportion of women in senior management positions through a range of initiatives, such as mentoring, training on unconscious bias, and maintaining a work environment that supports work-life balance and models that support balancing parenthood
• Embedding our diversity targets in succession planning, with a preference for female candidates when identifying top talent
• Gender is one of the diversity criteria we apply when selecting members of the Supervisory Board and of the Executive Board.

For more information, see Diversity and Inclusion and the Annual Report.

Threat:
Risk of failing to fulfill the expectations of local communities and local administrations with regard to economic benefits and contributions to the development of local areas by implementing community development projects as per local needs.

• Carrying out social and human rights impact assessments including baseline and community needs assessments at the planning stage in order to identify potential impact areas to be addressed in the design phase
• Development and application of local content strategy and education and skill development programs for locals, including local contractors
• Education and awareness sessions about local norms and customs for site staff, including contractors and subcontractors
• Regular stakeholder engagement including communities on site
• Establishment and effective application of community grievance mechanism
• Defining social indicators and integrating them into regular HSSE audits

For more information, see Human Rights and Local Procurement and Capacity Building.

Threat:
Plastic waste, if not collected, sorted, and disposed of properly, could end up in the environment, cause environmental pollution, harm animals, and ultimately end up as microplastics in drinking water and food.

• Plastics are too valuable to end up in the environment. As a resource, plastics should be collected, sorted, and recycled. Borealis therefore plays a key role in the transformation of the industry to a circular economy.
• Borealis has initiated Project STOP, a program that helps cities in Indonesia establish low-cost, more circular waste management systems, thus avoiding the leakage of plastics into the ocean.

For more information, see Plastics Recycling and Waste.

Opportunity:
OMV identifies opportunities that would limit emissions beyond regulatory carbon emissions requirements in various countries where we operate. Capturing CO₂ and processing it into synthetic fuels, plastics, or other chemicals are included in the opportunities identified.

• Creating cross-sectoral value chains and operating full-scale plants

Threat:
Risk of imbalance between certificates allocated and emissions volumes required for company activities, resulting in higher costs generated by the uncertainties about the allowance demand and abatement costs.

Risk of failing to improve energy efficiency followed by insufficient focus on or capability to achieve energy efficiency (to identify and implement energy efficiency projects), leading to higher energy costs, energy consumption, and GHG emissions.

Risk of inability to adapt to the rapid changes to emerging routine flaring requirements. Reputational damage could be triggered by pressure from local communities for reductions beyond the applicable legislation on flaring and emissions intensity. With the expected upcoming stricter policies and regulations requiring zero routine flaring conditions, certain field development concepts based on routine flaring might not be feasible (e.g., early production facilities in remote areas) or may only be possible with higher investments and operating costs.

• Developing and implementing a forward-looking OMV Carbon Trading Strategy
• Lowering internal hurdle rates for energy efficiency projects
• Reducing GHG emissions in OMV’s carbon-intensive facilities by implementing energy efficiency improvements and technology changes
• Boosting energy efficiency and reducing internal fuel consumption by increasing renewable energy supplies, such as the Company’s own photovoltaic plants
• ISO 50001 certifications for Refining and partly for Upstream
• Phasing out routine flaring and venting as a major contribution to reducing GHG emissions
• Carbon reduction targets integrated into the Executive Board’s Long-Term Incentive Plan

For more information, see Carbon Efficiency and Business Resilience.

Threat:
Risk arising from the organization’s inability to implement and manage new technology and products to reduce the carbon intensity impact. Emerging regulations aimed at the decarbonization of economic activities pose a substantial and wide-ranging threat to our carbon-intense value chain, thereby leading to both direct and indirect risks for OMV.

• Strong focus on natural gas sales and petrochemicals sales increase
• Developing new business opportunities based on a low-/zero-carbon product portfolio by the newly created New Energy Solutions department
• Carbon reduction targets for the product portfolio
• Carbon reduction targets integrated into the Executive Board’s Long-Term Incentive Plan

For more information, see Carbon Efficiency.

Opportunity:
As part of the clean energy transformation process to tackle the impact of climate change, OMV develops viable businesses based on hydrogen, bioenergy, carbon, and geothermal models, for instance. This would generate new revenue streams to compensate for the reduction in conventional product demand.

There is potential for substantial new business, e.g., intensifying the strategic energy cooperation with various partners in order to generate renewable energy for OMV’s own energy consumption or developing new technologies and products in order to reduce the carbon intensity of conventional oil and gas products in the Company’s portfolio.

• Identify and execute business opportunities which offer significant upscale potential, fit OMV’s capabilities, and create long-term value for OMV and its shareholders
• Increase energy efficiency and reduce internal fuel consumption by using renewable energy supplies such as our own photovoltaic plants
• Develop OMV’s long-term decarbonization targets
• Carbon reduction targets integrated into the Executive Board’s Long-Term Incentive Plan
• Scale up engagement in renewable energy sources

For more information, see Climate Strategy and Carbon Efficiency.