Hess’s commitment to transparency is clearly the mark of a mature reporter, although the energy company would benefit from a more human voice weaved into its narrative

Hess Corporation is a leading energy company with assets across the globe. You might recognise the name from seeing it on toy trucks or from brand advertising in New York’s Yankee Stadium. It has recently transformed itself from an integrated energy company, with downstream retail and marketing businesses, to a pure-play oil and gas exploration and production (E&P) company. Thankfully the toy truck remains.

Hess’s 18th annual Corporate Sustainability Report is produced in accordance with the Global Reporting Initiative’s (GRI) G3.1 guidelines. The report is available as a downloadable PDF and an easily navigable collection of pages on the Hess website. Structured around Hess’s performance and programmes in environmental, health, safety and social responsibility (EHS&SR), the PDF and web follow a similar layout.

At around 60 pages, the report is long enough to provide a comprehensive look at Hess’s sustainability programmes and key achievements without being too long-winded. It is evident that Hess takes its commitment to corporate sustainability seriously and has outlined a clear vision for the future, especially in light of its recent business transformation. The report openly lays out Hess’s plan to realign its EHS&SR strategy with the company’s new direction. It goes into great detail to describe the implementation and roll out of enterprise-wide EHS&SR risk management standards.

While not visually groundbreaking, the report’s strength lies in its discussion of key issues in a transparent and compelling manner. Hess does not shy away from disclosure and does a commendable job of identifying and reporting on those sustainability indicators most important to its business. Corporate responsibility is clearly embedded in Hess’s management approach, and this comes across in its report as well as its performance in green rankings. Among US energy companies, Hess was ranked first in the 2015 Newsweek Green Rankings and was the top ranked oil and gas company in Corporate Responsibility Magazine’s 2015 100 Best Corporate Citizens.

Hess is committed to improving employee safety and has made significant progress in this area. In 2014, Total Recordable Incident Rate and Lost Time Incident Rate (for both employees and contractors) decreased by 23% and 14% respectively from 2013. Hess has set ambitious goals to further reduce its recordable incident rate in 2015 and appears determined to achieve an ultimate goal of zero incidents. The company has also made significant investments in community programmes, contributing more than $42m in 2014, up from $18m in 2010.

Hess is not shy about climate change and on page 35 says the company “acknowledges that rising greenhouse gas (GHG) emissions and global temperatures pose risks to society and ecosystems”. Hess is taking steps to reduce flaring (burning off waste gas from oil wells) and understand fugitive methane emissions from gas production. Occasionally, however, the devil is in the detail. Although Hess has decreased net equity greenhouse gas emissions by around 30% since 2010, much of this comes as a result of asset sales and closures.

Meanwhile, operated direct emissions (Scope 1) have increased by more than 20% over that same period to roughly 4.8m tonnes CO2e in 2014. And while CEO John Hess envisions the company as “a trusted energy partner that helps meet the world’s growing energy needs in a safe, environmentally responsible, socially sensitive and profitable way”, the relegation of environmental topics to the back of the report is somewhat curious. Intentional or not, Hess is downplaying what are clearly some of its most significant issues.

To be fair, Hess is an oil and gas company, and its bread and butter will continue to be, for the foreseeable future at least, the extraction and production of fossil fuels. And while Hess appears to be doing more from an environmental sustainability perspective than many of its fossil peers, the approach is still unlikely to win the hearts of environmentalists any time soon.

Hess is earnest in its approach to reporting and sustainability, and how this ultimately impacts its business. Transparency is also central to its approach, which is laudable. But the report lacks a human element. While its employees and community programmes are undoubtedly vital to Hess, the company could showcase this in a more compelling way by weaving a greater number of case studies and first person narratives into its the report.

Maybe it could learn about storytelling from the fabled baseball team it supports with such enthusiasm. 

Snapshot
- Follows GRI? Yes
- Assured? Yes
- Materiality analysis? Yes
- Goals? Yes
- Targets? Yes
- Stakeholder input? Yes
- Seeks feedback? Yes
- Key strengths? Strong metrics and transparency
- Chief weakness? Lack of case studies and a strong human voice
- Pleasant surprise? Clear prioritisation of Sustainability on the Hess website.

Daniel Liswood is a consultant at Context America

sustainability report  CSR  corporate citizenship  emissions  case studies 

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