INTEGRATED ESG
REPORT 2020

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Our stakeholders

Non-financial indicators:

Given the diverse activities and reach of the PGNiG Group’s operations, we interact daily with a wide range of various stakeholder groups. Each of them has their own needs and expectations regarding the information provided.

  • GRI 102-40
  • GRI 102-42
  • GRI 102-43
  • GRI 102-44

Based on our contacts with stakeholders throughout the year and the survey to identify material topics for this year’s Non-Financial Report, it should be noted that compared with the previous year’s greater importance is being attached not only to non-financial information, but also to initiatives which the Group plans to carry out in the near future. The delivery of the CSR Strategy and initiatives undertaken in the human resources, environmental and social areas are gaining in prominence among stakeholders. The growing interest in non-financial aspects is also driven by their inclusion in investors’ assessment of potential return on investment and PGNiG’s presence in the ESG index. The activity of individual stakeholder groups varies depending on economic and regulatory conditions. In 2020, stakeholders requested more non-financial information on climate-related and more broadly defined ESG initiatives, as well as the planned R&D activities.

Whatever their expectations, the PGNIG Group seeks to develop open dialogue and collaboration with each stakeholder group. Bilateral exchange of information facilitates making business decisions contributing to sustainable development of the Group and of the ecosystem in which it operates.

In order to effectively build strong and positive relations with key stakeholder groups, the PGNiG Group has created a matrix of its stakeholders along the value chain and defined the relevant activities within and outside the Group. As expectations and needs of stakeholders keep changing, the PGNiG Group updates them on an ongoing basis.

Stakeholders matrix

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In 2020, a review of the stakeholder groups was carried out, identifying the interdependencies and the main areas of interaction. The stakeholders were classified in accordance with the recognised method proposed by G. Johnson and K. Scholes, which helps identify stakeholder groups with similar expectations in terms of their interest and power. This classification and approach to the PGNiG Group’s stakeholders facilitates stakeholder management and helps better adapt to specific information needs. The result of the work is the stakeholder matrix, which shows not only the power and level of impact of a particular group on the PGNiG Group, but also the type of impact, which may be positive, neutral or negative. The graphic form allows the Group to combine those stakeholder groups which have specific information requirements.

In addition, the relationships and impact of the stakeholders, as well as their expectations and influence on the PGNiG Group were analysed. The communication methods and topics most frequently addressed as part of the interaction were also taken into account. The table below presents the diversity and scale of stakeholders’ interest, which the Group manages on a daily basis.

List of stakeholder groups with description, impact and communication

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
The PGNiG Group is an entity of strategic importance to Poland. The Group’s majority shareholder is the State Treasury, holding 71.88% of its shares. The minority shareholders include Polish and international pension and investment funds, as well as businesses and retail investors.

Banks and other financial institutions represent a significant segment of this stakeholder group, providing financing for the Group’s day-to-day operations and strategic projects.

 The State Treasury expects PGNiG to support its social and economic goals and contribute to Poland’s position on the international arena, in keeping with the strategic objectives that focus on ensuring the country’s energy security. Other shareholders and investors, in line with the Group’s strategy, expect it to deliver satisfactory economic and financial performance building its competitive position on the international market, foster the Group’s growth through innovative climate-oriented and environmental solutions, and pay dividends (dividend policy).

In addition, financial institutions expect a guarantee of repayment of the capital they provided to the Group as well as financial and legal transparency.

 The growing confidence of capital market participants in the PGNiG Group has evidently had an impact on capital mobilisation. The record-high economic and financial performance, improved competitive position of the upstream and distribution business and the share of gas as an alternative fuel on the commodity market have an influence on stakeholders wishing to participate in future profits, eliminating short-termism among those that may be expecting immediate returns.

The PGNiG Group’s efforts are also reflected in its good financial ratings, which have a positive effect on investors’ readiness to invest in PGNiG debt securities on international markets despite their lower yield, caused by the overall market situation (low interest rates), and improve the Group’s creditworthiness, which directly translates into its ability to raise cheaper capital.
  • meetings and conferences for shareholders and investors
  • current and periodic reports
  • newsletter
  • reports and information materials
  • email and telephone contact with the Investor Relations Department
  • direct email and telephone contact with the PGNiG Group’s business units
  • official contacts with governmental authorities
  • exchange of correspondence with representatives of the State Treasury
  • joint initiatives of the PGNiG Group and governmental authorities: conferences, workshops, bilateral meetings
  • the Group’s financial standing
  • transparency of operation
  • the Group’s strategy and objectives
  • development activities
  • the Group’s values.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
ESG disclosures are increasingly important in the assessment of companies’ investment risk.

By analysing correlations between financial and non-financial data which affect a company’s future financial performance and stock market valuation, analysts provide full information to potential investors. Their assessment determines retail and institutional investors’ readiness to invest in financial instruments issued by the PGNiG Group.

 Stock and ESG analysts want to receive reliable and concrete information that has a real impact on the future financial performance, market position and, consequently, market valuation of shares, derivatives, and debt securities. The PGNiG Group is in dialogue with analysts, informing them of its ESG implementation and monitoring. Reporting on the progress of processes involving the European Commission’s guidelines on climate neutrality, the European Green Deal, human rights, ethics and corporate governance, while ensuring that profits are earned and the leading position is maintained through a development process aligned with the current and expected market landscape, are all a part of the analysts’ assessment.
  • meetings and conferences for shareholders and investors
  • current and periodic reports
  • newsletter
  • reports and information materials
  • email and telephone contact with the Investor Relations Department
  • non-financial information of the Group
  • transparency of operation
  • the Group’s strategy and objectives
  • involvement in ESG
  • the Group’s values.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
This stakeholder group comprises a wide range of entities trading with the PGNiG Group in Poland or abroad. It includes both key suppliers, of strategic importance to Poland’s energy security, and other smaller companies that support the Group, in particular in the implementation of its technological processes. On the one hand, these are entities that work with the PGNiG Group in the supply of gas from Poland to other countries with which the Group has signed long-term contracts. On the other hand, this stakeholder group includes companies with which the PGNiG Group carries out its development and innovation projects to implement new technologies and solutions. As part of such cooperation, the PGNiG Group develops technologies to produce, distribute and store hydrogen, a clean fuel for zero-emission hydrogen vehicles. Depending on the type of suppliers, different cooperation policies are applied. The key aspects of cooperation with suppliers are the certainty of supplies, continuity of cooperation, and security of payments for the goods or services received. The PGNiG Group’s procurement policy attaches great importance to compliance with ethical, social and environmental standards by potential suppliers. Therefore, suppliers expect clear and transparent terms of cooperation from the Group – from tender procedures to transaction settlement methods. The main element of successful cooperation is to fulfil the agreed financial and non-financial terms of contracts, while maintaining confidentiality of the projects. Trading partners expect the PGNiG Group’s support in joint ventures, which is to help attract customers and open up new business areas facilitating the development of a competitive offering for customers. The fulfilment of mutual expectations is also an important aspect of such cooperation. Therefore, the PGNiG Group expects its suppliers to constantly improve their processes to deliver products of a required quality. At the same time, through certain procedures, it seeks to ensure compliance with the terms of contracts and participation in tender procedures. In addition, it expects that liquidated damages for failure to comply with the terms of contracts are respected. A key element building trust in a partner is its reputation and a portfolio confirming relevant experience. aa
  • interacting with contractors in the course of procurement processes, in keeping with the rules of fair competition and equal treatment of contractors
  • involving contractors in optimising procurement within individual product segments, e.g. through technical dialogue with contractors, RFIs, etc.
  • evaluation of working relationships
  • industry conferences
  • one-on-one meetings, interaction within business and industry organisations
  • IT platform for suppliers and trading partners
  • joint projects and business initiatives
  • terms and conditions of business
  • transparent rules of cooperation with and selection of suppliers
  • conditions of accepting and making complaints about deliveries
  • joint sectoral initiatives, including events and conferences
  • quality of offered products
  • planned product development
  • satisfaction with the relationship.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
Innovators and start-ups are a group of stakeholders that are expected to help the PGNiG Group to achieve dynamic growth by providing inspiration for innovative projects consistent with global trends. Innovators expect clear conditions for presenting their ideas and solutions as well as support in their development and implementation.

They exert a positive impact on the Group’s status quo, encouraging it to seek and invest in innovation. At the same time, the Group makes sure that the financial risk related to the project budget, and the non-financial risk (related to whether the activities undertaken are reasonable in relation to the possible implementation of the innovation on an industrial scale) are clearly defined. The ultimate purpose of such cooperation is to enhance the Group’s competitive advantages in the main areas of its business.

 The PGNiG Group is contributing to increased involvement in new innovative projects, and thus to faster research and development processes.

The Group also creates new business needs, which require knowledge of the innovation management at start-ups from initial ideas through to commercialisation, increasing its business scalability through market position.
  • competitions for innovation projects
  • conferences, workshops and meetings for entrepreneurs running start-ups
  • cooperation with PGNiG Ventures, a corporate venture capital fund
  • direct email and telephone contact
  • the Group’s strategy and objectives
  • development activities
  • joint ventures
  • development plans.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
Ongoing cooperation with scientific and research institutions and universities is among the cornerstones of PGNiG, giving it access to knowledge supporting decisions on the global development trends for the Group. The key element of the Group’s growth is its intellectual capital, represented by top-class experts’ knowledge, patents and innovative solutions implemented on an industrial scale, which makes the Group a market leader. Science and educational institutions expect the Group to provide support and cooperate in the development of their activities so that their scientific and educational efforts are directed towards practical solutions for business. Vocational schools provide future employees for the industry. Cooperation in this area helps to meet businesses’ needs regarding the knowledge and skills of future employees.

Scientific and research institutions supplement the Group’s own intellectual capital. They foster development at the interface between science and business, thus providing a springboard for creating innovative solutions, which are then validated by start-ups and commercialised by the Group’s special purpose vehicles.

Universities and schools are also a special group of stakeholders that affect the Group’s decisions in the educational area. The research staff’s potential allows PGNiG to implement growth- and climate-oriented projects and to make proper use of innovative research work. The Group also engages in social outreach activities geared towards promoting education, and supports professional advancement of the Group’s employees by offering them post-graduate, MBA and other courses.

 Given its staffing needs, the PGNiG Group expects that its future employees are trained in relevant areas and gain specific competencies. By becoming a patron of schools, it can influence the education of its future technical staff and the development of skills and competencies important for future work. In addition, it provides research problems with sound business rationale, whose solution has an actual effect on economic growth.
  • joint projects
  • conferences
  • direct email and telephone contact
  • consultations and expert support for investment projects
  • joint research and development projects
  • support for vocational education at all levels
  • the PGNiG Foundation’s projects and grants
  • development plans
  • support for community education
  • joint initiatives and projects.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
As a leading integrated gas and oil group in Poland, PGNiG has a broad base of retail and business customers,

whom it supplies chiefly with natural resources (in particular gas and crude oil), as well as other products and services offered by the many companies forming part of the Group.

Its generation segment supplies heat and electricity to the market.

 Retail customers expect the Group to ensure a continuous supply of gas at an affordable price, so that it represents a small portion of their household budgets. Businesses expect to receive gas supplies, for both heating and process purposes, that account for an optimum share of their expenses. Efforts taken by the PGNiG Group in those areas allow it to maintain or grow its market position among business customers for which gas purchases are a significant cost component. The PGNiG Group leverages cutting-edge technologies to ensure that its customers have better access to the services provided by the Group. At the same time, the Group encourages the transition to more environmentally friendly solutions, for instance by opting for e-invoices or using online customer support. In this way, the Group builds environmental awareness among its customers. The PGNiG Group has also had a direct impact on the well-being of its customers through deployment of IT systems designed to ensure their safety during the COVID-19 pandemic, by limiting face-to-face contacts and replacing them with remote customer service
  • satisfaction surveys
  • helpline
  • Group companies’ websites
  • Customer Service Offices
  • eBOK (electronic Customer Service Office)
  • dedicated business consultants
  • contact centre
  • tailored terms and conditions of business
  • development of new products and services
  • discount policy
  • working relationships
  • quality of offered products
  • customer satisfaction.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
The Group has both domestic and international strategic partners. With the State Treasury as the majority shareholder, various equity-related strategic alliance options are considered, with the overriding objective of reinforcing the Group’s competitive position and fuelling its continuing growth, especially internationally and globally. For that particular stakeholder group, generated synergies and the mutually complementary intellectual capital are of primary importance. Therefore, it is crucial to determine the scope of business and specific projects which, when delivered together, will produce tangible effects. To that end, strategic alliances require a well-structured partnership framework, involving the access to human resources which will form dedicated teams to deliver specific objectives. What lies at the very core of any strategic partnership is a joint strategy as well as a map of mutual connections and interdependencies necessary to deliver the desired objectives. At the same time, the PGNiG Group expects a realistic assessment of the project viability and potential, both before and during such partnership.
  • individual meetings with the Management Board and key personnel
  • current and periodic reports
  • reports and information materials
  • direct email and telephone contact with the PGNiG Group’s business units
  • industry conferences
  • terms and conditions of the strategic alliance
  • strategic plans
  • growth of the Group
  • satisfaction with the strategic alliance.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
Energy sector companies, including those operating on the retail market, which sell gas fuel directly to retail and business customers. To increase their market share, they offer gas fuel at competitive prices in addition to sales of natural gas or other products and services. Competition pressures the PGNiG Group to launch new or improved solutions for its customers, Which creates an opportunity to look for new markets for the Group’s products. In many cases, the competitors’ activity makes the Group negotiate gas prices with key B2B customers on an individual basis. The PGNiG Group’s market position forces its competition to explore new business areas and revamp their offerings with new selling points to attract potential customers. In the wholesale market, this includes price hedging mechanisms and bundling of gas and electricity sales. In the case of retail customers, in addition to product bundling, PGNiG’s competitors offer price discounts and ancillary services
  • industry conferences
  • one-on-one meetings, interaction within business and industry organisations
  • joint ventures under the auspices of the Ministry of State Assets
  • joint projects and business initiatives
  • net profit/(loss)
  • the Group’s strategy and objectives
  • development activities.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
Mass media is a main channel of communication with other stakeholders, through which the Group provides, locally and nationwide, information about key events, projects and achievements of strategic importance to Poland and individual communities. The media also have their role in opinion-forming in other stakeholder groups through interviews, conferences, publication of financial and non-financial reports The media expect to receive reliable information on the Group’s investment projects, financial results and plans. Their ability to form opinions on the Group’s operations make them a source of consistent and transparent information, based on which all interested parties can assess those operations against the objectives set and pursued by the Group. The PGNiG Group expects reliable information to be provided to its stakeholders based on facts and verified data, and any analyses and editing should be well-balanced so as not to mislead the audience (i.e. create positive or negative misconceptions).
  • press articles
  • interviews
  • magazine and newspaper inserts
  • the press office and press releases
  • commentaries and opinions
  • discussions, debates, consultations
  • press/earnings conferences
  • special-occasion meetings
  • net profit/(loss)
  • the Group’s strategy and objectives
  • development activities
  • the Group’s values.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
A significant group of stakeholders actively involved in social campaigns and charitable projects – a beneficiary of programmes implemented mainly by the PGNiG Foundation. PGNiG engages with this stakeholder group in social support programmes through joint initiatives that foster the needs of local communities, support cultural and industrial heritage, scientific research and environmental protection, both nationwide and locally. The PGNiG Group expects support from social organisations and NGOs to better understand the needs of communities and expects them to act as ambassadors under certain initiatives. Thanks to partnerships with local organisations that provide a better insight into the regional background, PGNiG is able to manage community relations more effectively.
  • dedicated business consultants
  • one-on-one meetings
  • conferences
  • involvement in worldwide humanitarian and charity relief efforts in Poland and globally – through the PGNiG Foundation
  • impact on local community development
  • financial support
  • joint community initiatives.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
The PGNiG Group is one of the largest employers in Poland. Its workforce is comprised of highly-qualified professionals with extensive experience. Employees are a group of stakeholders who, through their knowledge, experience and skills, create added value for PGNiG by providing high-quality products and services. Employees build PGNiG’s organisational culture, support implementation of the Group’s strategic objectives, and directly contribute to ensuring Poland’s energy security. The PGNiG Group offers the very first job to many young people and is an employer of choice among new labour market entrants. At the same time, as the Group continues to grow, it is constantly on the lookout for specialists in various professional fields, whose qualifications will contribute to building an innovative organisation. A key aspect of the Group’s operations is providing its employees with stable employment and rewarding career opportunities in a safe and friendly working environment.

The complexity of processes implemented at the PGNiG Group requires its staff to constantly broaden their knowledge and improve their skills. Employees actively participate in growth-oriented projects that enable the Group to provide top-quality services and products. On the other hand, they expect transparent rules of employment and remuneration appropriate for their roles.

Potential employees who plan on building their career at the PGNiG Group require clear and transparent rules of recruitment, compliant with the applicable laws. They also expect transparency at each stage of their employment, adherence to the agreed terms and non‑discriminatory assessment of potential job candidates based solely on their qualifications and skills.

 Thanks to the unique relationship forged between the PGNiG Group and its employees, the Group’s impact on its workforce is multifaceted: the Group expects its employees to be truly involved in their tasks and duties, motivates them to develop and hone their skills, and requires them to comply with the rules, procedures and the Group’s code of ethics and core values, thus building a responsible workplace.

As an employer enjoying recognition in the labour market, the PGNiG Group expects job candidates to become familiar with the Group’s operations and its projects, explain how they intend to contribute to building the Group’s competitive advantage, and discuss how they plan to address potential competence gaps, so as to have a hand in the PGNiG Group’s continued growth.
  • consultations with employee representatives (as needed)
  • Employee Council (meetings/consultations in accordance with statutory requirements)
  • a group of communicators (employees responsible for internal communication processes) – communicator meetings held typically several times a year
  • daily electronic newsletter, corporate intranet
  • employee surveys (a large-scale survey held every two or three years, and yearly satisfaction surveys on the quality of communication and IT services)
  • special-occasion meetings
  • current and periodic reports
  • reports and information materials
  • job postings
  • press conferences
  • remuneration and bonus scheme
  • payroll policy
  • potential for development
  • assistance and benefits
  • family-friendly policy
  • stability and certainty of employment
  • terms of employment.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
Representatives of the PGNiG Trade Unions voice the employees’ opinions and take part in important decisions with regard to the organisation’s HR policy. They communicate the employees’ opinions on the working conditions to the Group as an employer, and present the terms and conditions of agreements between the parties with respect to professional and social matters. The Trade Unions represent and defend the employees’ rights and professional and social interests, and are involved in creating regulations that govern the relations between the Group and its employees by negotiating, for instance, terms of employment, salaries and wages, and workplace health and safety conditions.
Another key aspect is labour/management relations in the key areas of the Group’s business and growth.		 Trade unions play a crucial role as employee representatives. However, the PGNiG Group also expects the trade unions to have a hand in building an atmosphere of dialogue with employees and to encourage employee engagement in the Group’s affairs and growth
  • consultations held with the PGNiG Trade Unions and Employee Council in accordance with the law and agreements in place (meetings and correspondence depending on current needs and arrangements between the Management Board and employee representatives)
  • contact with employees of individual Group companies and PGNiG Branches responsible for conducting dialogue with the employer
  • the same tools as those used to communicate with other employees: daily electronic newsletter, corporate intranet, etc.
  • development plans
  • operating strategy
  • terms of employment
    and remuneration
  • payroll policy
  • respect for human rights.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
Being one of the largest and oldest businesses in Poland, PGNiG conducts its operations in multiple locations, both domestically and abroad. Aware of its impact on the communities within the footprint of its projects, the Group has always sought to build long-lasting relations based on mutual trust. PGNiG cooperates with all stakeholders, including local residents, representatives of local governments, businesses and organisations. Local communities take an interest in investment projects carried out close to where they live. For the Group’s projects to be completed in an uninterrupted and timely manner, it is vital that all activities meet with approval from the communities in their immediate vicinity. Their launch is in each case preceded by dialogue with the local community. It is essential to provide information about the process and to gauge the community expectations in order to minimise its adverse impact on the social environment.
PGNiG engages in extensive dialogue with local communities to adapt its investment projects to their needs. Through social activities as well as informational and educational efforts, it seeks to ensure that the local community understands the role of a given project, accepts it, and joins in its implementation.
As a result, in many cases the Group engages in infrastructure development projects and supports local social organisations, science, culture and sports.		 The ability to meet halfway and find common ground is the key to healthy social relations. In its dialogue with local communities, the PGNiG Group seeks partnership and cooperation. Therefore, it expects clear and fair information from this stakeholder group regarding any potential obstacles that could get in the way of the Group’s investment project, as well as an attitude necessary to prevent escalation of problems in connection with the Group’s activities.
  • public consultations (in accordance with the law and the Company’s concept of social dialogue; other activities – as needed)
  • activities of the PGNiG Foundation
  • direct interaction with local authorities and organisations
  • dialogue relating to ongoing investment projects
  • investment plans
  • support to local communities
  • regional initiatives.

List of stakeholder groups with description, impact and communication Stakeholder relationships and impact on the PGNiG Group PGNiG’s expectations and impact on stakeholders Method of communication Communication topics
Public administration bodies, the regulator (Polish Energy Regulatory Office URE), and the European Commission provide a legal framework governing business activities. The EC works with national regulators to implement solutions introduced across the EU at the national level. Cooperation with this stakeholder group is based on mutual dialogue and respect for the law.

PGNiG Group companies operate in regulated sectors, including gas distribution and storage, so regulatory compliance is a key aspect of their business. The Group engages in an open dialogue, which involves reviewing drafts of legislative solutions at the national and EU legislation level.

On the other hand, as new legislative solutions are introduced, PGNiG adapts its operations, business model and processes to bring them into compliance.

 By voicing its position on important legal, regulatory and reporting matters, PGNiG protects the best interests of both the Company and its customers. In order to build sound relations with the regulators, the impact of any legislative changes on Poland’s competitive landscape and energy independence must be highlighted.
  • consultations
  • exchange of correspondence
  • joint initiatives – conferences, workshops, bilateral meetings.
  • adherence to standards and legal regulations
  • impact on the country’s economy
  • impact on market development.
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