The Company recognizes the importance of its impact on the economy, the environment and society and, while striving to increase longterm value, ensures its sustainable development in the long term, balances interests of stakeholders.
The principles of sustainable development are implemented in the context of three levels:
- Strategic integration – the principles of sustainable development are incorporated into the Strategy (for more details, see the "Company’s development strategy" section);
- Operational integration – all corporate decisions are made by the Company's management based on the criteria of compliance with the principles and goals of sustainable development;
- Cultural integration is implemented as part of conducting training at the Company, posting articles on the corporate portal of the Company, as well as within the Code of Conduct (for more details, see the section "Social Aspect").
“Samruk-Energy” JSC updated the Development Strategy in, according to which the Company plans to accomplish the mission and vision from the perspective of ESG principles, by сhosing Sustainable Development as one of the key priorities of the Strategy.
The key factors of sustainable development for the Company are the well-being of people, ecological balance and, at the same time, ensuring the long-term financial stability of the company. Accordingly, the Company’s operations determined for 2022–2031, are based on the consistency of environmental (E), social (S) and management (G) principles, while maintaining a balance of interests of all stakeholders.
The company, applying a risk-based approach in its operations, strives to achieve a stable increase in value and enhance competitiveness in the long term.
To this end, a comprehensive risk assessment is conducted regularly, using risk management tools and a systematic approach to sustainable development:
- assessment of current and future risks associated with the effect of global factors of sustainable development;
- forecasting economic, socio-demographic and environmental trends;
- analysis of social, environmental and economic aspects of current impact of the Company on the region where it operates;
- development of measures aimed at managing the Company's impacts on the region where it operates, mitigate risks and realize opportunities;
- enhancing the risk culture in general, analyzing the effectiveness of risk management actions, identifying opportunities associated with current and future risks.
Key trends and risks in sustainable development for the Company
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Economic aspect |
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Trends |
Risks |
Opportunities |
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Slowdown in electricity consumption growth rate |
Deterioration of the macroeconomic environment, slowdown in growth in demand for electricity; high planned rates of commissioning of new facilities that exceed the actual growth in demand |
Efficient use of the existing portfolio of assets |
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Growing instability of the economic system due to the susceptibility of resource-extracting industries to crises because of global price volatility |
Increasing the likelihood of crises that hinder access to financing for new projects |
Improvement of production efficiency, upgrading of existing assets |
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Increasing energy conservation and increasing the energy efficiency of the economy |
Lowering of demand for electricity from conventional generation |
Use of coal combined with advanced clean coal technologies |
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Environmental aspect |
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Trends |
Risks |
Opportunities |
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The trend towards decarbonization of the economy |
Deterioration of competitive position of coal generation in comparison to gas, HPP, NPP, RES. |
Receipt of loans under favorable terms for the development of new projects (clean coal, underground coal gasification, methane production, development of renewable energy generation); improving the quality of the fuel used |
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Tightening of environmental legislation |
Tightening of environmental regulations and standards; increase in payment rates for emissions; tightening requirements for water consumption – transition to recycling water supply, tightening regulation of greenhouse gas emissions; waste disposal costs |
Increasing the use of green technologies |
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Growth of environmental requirements of local communities |
Media activity in sharing environmental information while there is no sufficient professional analysis, creation of a negative image of the Company |
PR as a "green" leader and responsible nature management entity, increasing the loyalty of the society |
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Social aspect |
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Trends |
Risks |
Opportunities |
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Slowdown in population growth rate |
Slowdown in electricity demand growth rate |
Development of export capacity, if feasible |
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Increasing demand for highly qualified personnel |
Lack of qualified specialists needed, “outrunning” an increase in the cost of labor and growth in the share of payroll in costs |
Performance improvement; enhancing the quality of production; improving the quality of education and training of specialists |
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Decreased attractiveness of work in the industrial sector |
Growing challenges in filling company’s job openings |
Development of a personnel reserve, succession of positions within the Company |
Based on these principles, external and internal assessment of the Company's operations, risks in sustainable development, in order to effectively and successfully manage economic, environmental and social aspects, the Company implements sustainable development initiatives in the following areas:
- introducing high ethical standards and building a corporate culture based on trust;
- the introduction of the principles of sustainable development and the application of a risk-based approach to the practice of project management at all investment stages: assessment and management of the impact on social, environmental and economic environment (involuntary resettlement, biodiversity, cultural heritage, etc.) in accordance with the Company’s Guide in sustainable development;
- enhancing financial stability;
- promoting responsible procurement based on the principles of fair and free competition, mutual benefit, transparency and full responsibility for the obligations assumed, as well as introducing a requirement for suppliers to comply with ethical standards and Guiding principles for the Company's suppliers, set out in the Company’s sustainable development guidelines;
- improving the safety culture through the involvement of employees in the occupational safety management system and improving the efficiency of control over OHS management system using international standards;
- increasing of social responsibility, following the principles of the UN Global Compact, investing in human capital;
- ensuring environmental sustainability, including the search for and implementation of the best technologies from an environmental and economic perspective, streamlining of production processes, implementation of projects using renewable energy sources, identification and prevention of potential emergencies.
All initiatives are prioritized based on the importance of a certain initiative for all key stakeholders.
The report on the implementation of the 2021 sustainable development initiatives plan has been posted on the corporate website of the Company: https://www.samruk-energy.kz/ru/sustainability
"SAMRUK-ENERGY" JSC CONTRIBUTION TO 17 SUSTAINABLE DEVELOPMENT GOALS
“Samruk-Energy” JSC, integrating the principles of sustainable development in its business, declares its commitment to the 17 Sustainable Development Goals. The company is aware that the environmental and social issues that reflect each of the SDGs are relevant and affect any organization.
“Samruk-Energy” JSC, in its operations, seeks to contribute to the achievement of the following UN sustainable development goals:
Goal 1:End poverty in all its forms everywhere
Goal 2: End hunger, achieve food security and improve nutrition, and promote sustainable agriculture
“Samruk-Energy” JSC group of companies strives to preserve jobs and index wages (according to the results of 2021, indexation averaged 5%). In 2021, the average salary of employees in the Company’s group increased in relation to the same indicator by 14%.
In 2021, the average salary of employees across the company’s group increased in relation to the same indicator from 273,628 tenge to 311,652 tenge.
The ratio of the minimum wage for women to the minimum wage for men is 100%. “Samruk-Energy” JSC, in accordance with Collective Bargaining Agreement, provides for: payment for overtime work, payment for work on holidays and days off, at night, allowances and additional payments, remuneration for labor of workers engaged in heavy work, work in hazardous (especially harmful), dangerous working environment, additional paid annual leave, financial assistance in connection with the birth of a child, financial assistance for the wedding and a one-time incentive in connection with the anniversary of employees (50, 60 and 70 years). According to Collective Bargaining Agreement, employees are paid a compensation payment in the amount of 3 wages upon termination of the employment contract, in connection with retirement (for more details, see the Social Aspect section).
The company seeks to ensure uninterrupted power supply to all regions where it operates, including in remote areas and settlements, for the possibility of sustainable farm management by local population.
“Samruk-Energy” JSC, being a socially responsible company, strives to pay attention to the social well-being of the regions where subsidiaries are located. In An active cooperation with “SK-Trust” CF on the possibility of obtaining support and implementing charity programs in the regions of subsidiaries’ location has started in 2019.
Every year the Company implements several social initiatives to help people with disabilities, the poor, retired employees, and patients suffering from cancer (for more details, see "Social aspect" section)
Goal 4: Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all
The total cost of education in 2021 was 306,428 thous. tenge. The number of trained employees is 13,873 (79% of the headcount across the Company’s group).
The average number of training hours per employee was 49.5 hours per year. Employees who combine work with study at educational organizations are also provided with additional vacations for the period of examination or orientation sessions, preparation, and defense of a graduation project (thesis), passing final exams. "Samruk-Energy" JSC cooperates with leading domestic universities, one of the priority areas in training is the certification of personnel according to internationally recognized training programs (for more details, see the "Social Aspect" section).
Goal 5: Achieve gender equality and empower all women and girls.
Goal 10: Reduce inequality within and among countries.
Samruk-Energy” JSC recognizes that gender equality is a basic human right, a key pillar for achievement of peace, prosperity and sustainable development. “Samruk-Energy” JSC supports 7 Principles for the Empowerment of Women developed as part of UN-Women partnership and the United Nations Global Compact. This document involves a commitment to the principles of gender equality as a key element of sustainable development, as well as a conviction that companies that provide women and men with equal opportunities are more successful and achieve better results. To achieve this goal, the Company has adopted an Action Plan.
In line with the Code of Conduct, values and principles, the Company declares that its zero tolerance to non-discrimination in daily operations, pursuit of reducing inequality and ensuring that no one is left behind, are an integral part of the process of achieving sustainable development goals (to learn more, please see section "Social Aspect").
Goal 7: Ensure access to affordable, reliable, sustainable, and modern energy for all
The company makes every effort to ensure that energy becomes more sustainable and widely available and focuses on the development of "clean" energy (RES).
As of the end of 2021, “Samruk-Energy” JSC has 5 operating renewable energy facilities. A unique 2 MW solar power plant was commissioned in Kapshagay city in 2013. The specific feature of this power plant is the use of the first tracker system in Kazakhstan for tracking the energy source. The first industrial-scale 45 MW wind power plant in Kazakhstan was put into operation in Akmola region in the vicinity of Ereymentau city in 2015. The wind farm consists of 22 turbines with a unit capacity of 2.05 MW. A 416 kW solar power plant was commissioned in Kapshagay city in 2019, where polycrystalline panels with a capacity of 245 W each produced by Astana Solar were used. In 2020, a wind power plant with a capacity of 5 MW was put into operation in the Nurly village of Almaty region. A 1 MW solar power plant was put into operation in Almaty city. These projects were implemented as part of the Agreement between the Governments of the Republic of Kazakhstan and the People's Republic of China.
At year-end 2021, the share of electricity generation by energy producing organizations of “Samruk-Energy” JSC was 7.7% of the total volume of renewable energy in the Republic of Kazakhstan
On November 25, “Samruk-Energy” JSC debut placed 18.4 bn tenge "green" bonds with a coupon rate of 11.4% per annum and a maturity of 6.5 years.
As part of the issue of green bonds, “Samruk-Energy” JSC has developed a Green Finance Policy that defines the principles in the field of green finance in order to ensure transparency in the processes of attracting investments through green finance instruments.
“Samruk-Energy” JSC energy producing organizations produced 35.6 bn kWh electricity in 2021. Generation by renewable energy facilities of “Samruk-Energy” JSC (SPP, WPP, small HPPs) in January-December 2021 amounted to 325.3 million kWh.
Goal 8: Promote sustained, inclusive, and sustainable economic growth, full and productive employment, and decent work for all
“Samruk-Energy” JSC is one of major employers in the Republic of Kazakhstan. As of December 31, 2021, the headcount of “Samruk-Energy” JSC group of companies amounted to 17,645 people.
The share of full-time employees in the reporting period was 100%. The ratio of the minimum wage for women to the minimum wage for men is 100% (to learn more about this, visit "Social Aspect" section).
Goal 9: Build resilient infrastructure, promote inclusive and sustainable industrialization, and foster innovation
One of the strategic goals of the Development Strategy of Samruk-Energy JSC for 2022–2031 is to reduce the net carbon footprint.
The Company is engaged in activities on facilitating R&D, building close relationships with the research community and increasing the practical effect of scientific developments, including with the support of research work by domestic human resources. Particular emphasis has been place on issues of commercialization of R&D in order to obtain a timely economic effect from scientific developments.
In this regard, the Company has started research and development work to study the possibility of applying carbon capture and storage technologies at coal-fired power plants, gasification, and production of synthesis gas for coal chemistry.
The aim of the project is to study existing and promising technologies for capturing CO2 from flue gases of thermal power plants, to analyze the possibility of their integration into existing technological schemes and disposal of captured CO2 with an assessment of the most promising technologies for the conditions of Kazakhstan, to conduct experiments to produce synthesis gas from CO2 and to produce coal chemistry products.
The project is planned to be implemented between 2022 and 2024.
Another important initiative of the Company is a project designed to improve the technical and economic performance of firing of high-ash coal at the Company's thermal power plants. As part of this project, the possibility of introducing the technology of a system of oil-free startup of boiler units (plasma-fuel system) was studied.
The project implementation was approved by the resolution taken by “Samruk-Energy” JSC Board of Directors at meeting held on May 31, 2021.
Goal 16. Promote peaceful and inclusive societies for sustainable development, provide access to justice for all, and build effective, accountable, and inclusive institutions at all levels.
The company adheres to high standards of business ethics, transparency, and legality, independent from business customs and other business practices in a particular jurisdiction. (to learn more, visit "Compliance" and "Stakeholders engagement" sections).
Goal 17: Strengthen the means of implementation and revitalize the global partnership for sustainable development
The Company, in its operations, is a member in the following national and international organizations, associations / organizations:
The CIS Electric Power Council (hereinafter – CIS EPC). Observer since 2012.Membership in the CIS EPC allows participating in the processes of integration of the CIS member states’ energy systems, including ensuring collective energy security; Provision of parallel operation of power systems; Creation of a common electric power market, involvement in preparation of international agreements in power sector; Technical regulations, unification and harmonization of laws and regulations in power industry, etc.
Kazakhstan Electricity Association (hereinafter – KEA). Membership since 2011. Membership in KEA allows exchanging information and participation in development of a regulatory legal framework in power sector, as well as conferences, seminars and other events.
KAZENERGY Association. Member of the Association since 2009. Membership in KAZENERGY Association allows participating in government initiatives and activities aimed at improving the RK investment climate, in developing and implementing measures to increase production and scientific and technical potential; as well as the Company may receive assistance in legal, economic, organizational and management matters.
The National Chamber of Entrepreneurs of the Republic of Kazakhstan (hereinafter referred to as the RK NCE). Membership in the RK NCE since 2013. Membership in the RK NCE helps to strengthen ties with business environment, effective development of electricity business, including as part of improvement of RK regulatory framework.
Membership since 2011. In the context of joining the UN Global Compact, the Company declares its commitment to following the ten principles of the Global Compact in its strategy and day-to-day operations.
ALE "Union of machine builders of Kazakhstan". “Samruk-Energy” JSC joined in 2021. Membership in the Union offers participation in import substitution activities as part of a program for promotion of new industries. Contributes to promotion of “Samruk-Energy” JSC as a company aimed at developing local content. Access to information about new and manufactured equipment, materials for the energy sector produced in the Kazakhstani market.
Coordinating Electricity Council of Central Asia. Participation in CEC CA contributes to enhancing of business ties between Central Asia countries and the discussion of problematic issues in the region.
World Energy Council (hereinafter - WEC). WEC membership is a program for a limited number of the world's leading energy companies interested in working with WEC on projects and issues of a global and regional nature. The WEC program allows to participate in exclusive events and round tables that contribute to the development of cooperation with international companies.
“Samruk-Energy” JSC has been an active participant of the UN Global Compact since 2011 and has followed the 10 principles of the UN Global Compact in its strategy and daily operations.
In view of joining to the UN Global Compact, the Company annually publishes Communication on Progress, which it posts on https://www.unglobalcompact.org/ and on the website of the Company: https://www.samruk-energy.kz/ru/sustainability/soobshchenie-o-dostignutom progresse-v-2019-godu-ao-samruk-energo.
All information about the principles, programs of the Company, reports and new projects in the social, economic and environmental areas is posted as they appear on the corporate website in the section https://www.samruk-energy.kz/ru/sustainability.
To improve the system of sustainable development and corporate governance, the Company plans to obtain an ESG rating from a global rating agency in 2022–2023.