This report, our sixth, sets out our commitment to continue to create value in a more sustainable way and to be at the forefront of sustainable practices.
What have we done so far?
In the year following Origin’s formation in 2000, we established environmental, social and economic objectives that we believed were essential to ensure the sustainability of our business. We first reported our progress against these objectives in 2002 and have reported our continued progress in each subsequent year.
We are pleased that setting these objectives has led to a number of major achievements over the past five years, including:
- An ability to measure our greenhouse gas emissions both within our business and customer supply chain.
- Significant investment in gas-fired generation which allows us to generate electricity at about half the greenhouse gas intensity of the National Electricity Market.
- An increased commitment to renewable geothermal energy through an investment in and joint venture with Geodynamics Limited.
- A successful pilot development and progress towards commercialisation of our SLIVER® solar cell technology.
- Advocating a carbon pricing regime to lower greenhouse gas emissions as a member of the Australian Business Roundtable on Climate Change.
- A customer base with the highest penetration of GreenPower at over 50 per cent greater than the national average.
- The ranking of our GreenEarth 100 per cent solar, 100 per cent wind and 100 per cent wind offset products by Green Electricity Watch as the three best products on the market for 2007, the group’s fourth consecutive report in which a selection of our products have been recognised as market-leading.
- Increased assistance to customers experiencing financial difficulty through industry-leading policies and services such as our Power On program.
- Improvement in our health and safety performance since 2003 from a Total Recordable Incident Frequency Rate of 25.9 to 16.3 in 2007.
- The delivery of quality local programs in consultation with the communities in which we operate, in turn strengthening our relationship with these communities.
- Compound total shareholder return of 32.4 per cent per annum from listing in February 2000 to 30 June 2007.
- External recognition of our commitment, progress and leadership in sustainability through various awards and acknowledgements from leading rating agencies, including Ethical Investor Magazine’s ‘Sustainable Company of the Year’ for 2007.
To further build on these achievements, we believe it is important to review our sustainability objectives and strategies in line with the ongoing growth and development of our business.
Over the past year, we conducted a formal review of our sustainability objectives and strategies. Learning from our achievements to date and setting our priorities for the future has provided the basis for this review throughout 2006/07.
Our approach to sustainability is guided by our company commitments and principles.
We know that fulfilling our commitments to key stakeholders often requires difficult decisions and choices to be made that may impact our areas of operation.
We have therefore established and communicated to all our employees a set of principles which guide the way we make these decisions and choices for the benefit of our stakeholders.
At the core of our principles is the recognition that we must create value from the resources that come under our control, and that the value we create is distributed to our key stakeholders, while being mindful of the need to ensure the sustainability of our business and its impact on the environment and the communities in which we operate.
Our application of these principles ensures we focus on those aspects of our activities that are most important to ensuring the ongoing sustainability of our business, and that we are most capable of significantly influencing through our activities.
In this report, we have set out sustainability objectives and strategies for each of our key stakeholder groups – employees, customers, communities and investors – as it is these groups who will judge our progress on our sustainability journey.
Our principles require us to be accountable to our key stakeholders by being open and transparent in our decision making. Reporting on our sustainability progress enables us to demonstrate the soundness of our decisions to all our stakeholders
Our sustainability objectives
Climate change remains one of our most significant environmental challenges. As an energy producer and retailer, we have long acknowledged that we operate in what will be an increasingly carbonconstrained environment. Origin has taken a leadership position in the climate change policy debate, and it is pleasing to note there is now a federal commitment to introduce a national emissions trading scheme to underpin the costing of carbon into the future. This is critical to ensuring the necessary shift in investment towards lower greenhouse gas-emitting energy technologies. Our objectives in this area continue to be focused on reducing the greenhouse gas intensity associated with our energy production and distribution, and reducing the carbon intensity of our customers’ energy consumption.
Origin’s operations – mainly through the extraction of oil and gas resources – also have an impact on the local environment. We are focused on improving our environmental management practices to deliver better outcomes by working with local communities to identify areas for improvement. Our objective is to take all feasible steps to eliminate or minimise any adverse impact our activities have on the environment.
We continue to attract and retain a great team in a highly competitive employment market and, at 30 June 2007, we employed 3,632 people across Australia, New Zealand and the Pacific. Our first objective is that no one will be harmed at work and we will achieve this by eliminating or managing hazards and practices in our business that could cause accident, injury or illness to people. Our objective is also to provide and maintain a satisfying and rewarding working environment for all employees.
We have a stated commitment that we will respect the rights and interests of the communities in which we operate, and this year we were able to work increasingly in partnership with these communities to deliver programs tailored to their expressed needs. This is in line with our objective to maintain community support and goodwill for the company’s activities.
Since 2002 we have reported the total value we created for our stakeholders and it is pleasing to note a 190 per cent increase over the five-year period. This means we can distribute increasing value to our stakeholders and be confident we are achieving our objective to provide sustainable returns to Origin’s key stakeholders.
These objectives have not changed dramatically over the years, however, through our review we have evolved the strategies we are pursuing to achieve our sustainability objectives. We have also established measures to assess our performance against each of our new sustainability strategies.
Our strategies and performance measures
We are faced with the considerable challenges and opportunities for creating value in an increasingly carbon-constrained environment, and ensuring we distribute the economic value we create in a way that is truly environmentally and socially sustainable. However, we are confident our business objectives, strategies and actions for improving our sustainability performance will position Origin to rise to these challenges.