|Proposed actions 2018||Planned actions 2019|
|Launching of the Conflict of Interest Policy.|
|Launching of the Compliance Communication Plan.||Development of the Compliance Communication Plan.|
|Audit the implementation of the Human Rights Policy.|
|Approval of update of the Human Rights Policy text to concepts and terminology of the United Nations Guiding Principles on Business & Human Rights.||
Update of the Human Rights Policy.
Level of fulfilment:
Finalised , Major progress, Intermediate progress, Little progress, Not started
Naturgy has a management approach
based on various policies and
procedures and specific tools, within
the framework of the company's Code
of Ethics. These mechanisms include:
the Code of Ethics management model,
the Crime Prevention Model, anti-fraud
and anti-corruption policies and plans,
tax policies and the company’s Human
These elements seek to ensure that the company's activities and those of its employees and suppliers comply with applicable standards and laws in every country in which it operates. They also seek to ensure that all the units and organisations behave impeccably in accordance with ethical values and formal commitments to conduct, and to prevent and detect any breach in the appropriate time and manner.
These programmes give rise to indicators for the management, control and supervision of the company's ethical conduct, which makes it possible to measure the effectiveness of the programmes that are in place and develop new improvement plans adapted to the specific needs of the business.
The Code of Ethics of Naturgy,
formulated and approved by the Board
of Directors, is the document that
establishes guidelines that must govern
the ethical behaviour of managers and
employees of Naturgy, in their daily
work, with regard to relationships and
interactions with all its stakeholders.
Since 2005, when it was adopted, the code has been regularly renewed to adapt it to the new situations that affect the company. The code sets out the undertakings entered into by Naturgy in the fields of good governance, corporate responsibility and questions of ethics and regulatory compliance. Naturgy also has an Anti-Corruption Policy, as an extension of chapter 4.7. on “Corruption and Bribery” of the Code of Ethics, in compliance with national and international legislation in this matter.
The company also has a Code of Ethics and an Anti-Corruption Policy management model, headed by the Compliance Unit, whose targets are to ensure the knowledge, application and fulfilment of the code.
This model also provides that the Audit Committee of the Board of Directors must receive regular reports from the Ethics and Compliance Committee on the most relevant issues related to the dissemination of and compliance with the Code of Ethics and the Anti- Corruption Policy.
|Ethics and Compliance Committee|
In 2018, the Code of Ethics Committee has ceased its activities and its functions have been assigned entirely to the Ethics and Compliance Committee, which reports its actions to the Audit and Control Committee.
Likewise, the Committee, chaired by the Chief Compliance Officer (CCO), has changed its composition in 2018, and now comprises the heads of some of the units most directly involved in the matters set out in the Code of Ethics.
The functions of the Ethics and Compliance Committee in these issues are to:
At international level, Naturgy has local committees in those countries where the company is most active, enabling us to ensure the existence of safeguard procedures in these countries.
In 2018, the Ethics and Compliance Committee held five work meetings.
Naturgy expects all its employees to render a high level of commitment to compliance with its Code of Ethics and Anti-Corruption Policy and, therefore, places an emphasis on transmitting the company’s culture of integrity. Its breach is analysed according to internal procedures, legal regulations and existing agreements.
Following the entry into force of the new Organic Law on Data Protection and Guarantee of Digital Rights, and in accordance with the provisions thereof, the Naturgy reporting channel allows for anonymous consultations and whistleblowing. In 2018:
During 2018, Naturgy managed various disciplinary situations from complaints made to the Ethics and Compliance Committee, or from situations covered in the Code of Ethics or the Anti-Corruption Policy. In total, 5 misdemeanours, 17 serious offences and 9 serious offences, of which 8 have resulted in layoffs were handled.
In 2018, it was not necessary to repair damages relating to impacts caused by human rights cases.
The company has a Crime Prevention Model which is updated annually. Thus in 2018, the model was subject to a process of adaptation to the new organisational structure in force at Naturgy.
From an organisational standpoint, the Board of Directors has assigned the functions of Autonomous Body, described in Organic Law 1/2015, to the Ethics and Compliance Committee, which is responsible for taking significant decisions in relation to the regular monitoring and oversight of the working and compliance with the Crime Prevention Model.
Each year, the model is assessed by an independent third party. In 2018 this assessment process was completed in December and the report issued on the design and effectiveness of the model was satisfactory.
Furthermore, in 2018, the model has also been subject to a gap analysis by an independent expert to identify improvement elements that allows the model to be submitted to the certification process in accordance with the UNE 19601 standards (Criminal compliance management systems) and ISO 37001 (Anti-bribery management systems). Worldwide, Naturgy has also gradually deployed crime prevention models in countries with laws governing the civil liability of legal persons.
During 2018, the online training course -mandatory for all employeescontinued on the Crime Prevention Model, Code of Ethics and Anti- Corruption Policy. The aim of the course is to emphasise the importance of compliance, ensure implementation of preventive and control activities and to inform all employees of the current status in these matters.
The Anti-Corruption Policy aims to establish the principles which must be used to guide the conduct of all employees and administrators of the companies of Naturgy with regard to the prevention, detection, investigation and correction of any corrupt practice within the organisation.
It covers all the actions in this area and avoid conduct that may give rise to fraud or corruption and lead to situations that are damaging for the company, its administrators and employees from a legal point of view or in relation to its reputation. These plans and measures include the investigation of the incidents, the definition of solutions and the establishment of disciplinary measures.
The Naturgy Crime Prevention Model is based on an analysis of criminal risks, including the one related to money laundering, introducing the necessary controls to prevent the perpetration of said crime.
Naturgy organises regular training initiatives based on the programme with the aim of raising awareness of the importance of fighting against corruption and ensuring that administrators, employees and suppliers are given enough and appropriate information to act accordingly.
Likewise, Naturgy has implemented a Corporate Hospitality Policy, within the framework of the Code of Ethics and Anti-corruption Policy, whose purpose is to regulate the conditions in which Naturgy administrators and employees can accept or offer courtesies to business counterparts within the framework of the performance of their professional functions. This is to ensure effective compliance with the principles set out in the Code of Ethics and Anti-Corruption Policy of Naturgy and thus avoid improperly influencing their commercial, professional or administrative relationships, both with public and private entities. In 2018, a specific disclosure campaign was carried out on this policy, aimed at all employees.
In addition, in all risk operations the company has a counterpart due diligence procedure that is applied systematically, to ensure that the analyses and evaluations of reputational risk and corruption are carried out in an efficient and uniform way whenever third parties intervene in the business relationships of the companies that make up Naturgy.
In 2018, the Board of Directors, with the favourable report from the Audit Committee, approved the Fiscal Strategy and the Fiscal Risks Control and Management Policy, which regulates the basic principles that must guide the fiscal function of Naturgy, as well as the key action lines to mitigate and guide proper control of fiscal risks. The fiscal policies of Naturgy are in line with the company’s Corporate Responsibility Policy and its Code of Ethics, the Code of Good Tax Practices (CGTP) and the guidelines of the Organisation for Economic Cooperation and Development (OECD) for multinational companies.
At the end of 2018, Naturgy does not have any company in any territory considered to be a tax haven pursuant to Spanish regulations that determine the countries that are considered tax havens (Royal Decree 1080/1991, of 5 July and Royal Decree 116/2003, of 31 January).
For the 95% stake in Buenergía Gas & Power, Ltd. (indirect holding company of a single industrial shareholding that engages in the production of electricity through a gas combined cycle in Puerto Rico (Ecoeléctrica L.P.), which was registered in the Cayman Islands, on 2 February 2018 the change of registered office to Puerto Rico was completed.
Likewise, for the 52.2% stake in Gasoducto del Pacífico (Cayman), Ltd. (a dormant company incorporated into the group as a result of the acquisition of the CGE group) that had its registered office in the Cayman Islands, on 12 January 2018, the liquidation of the company was completed and its dissolution took place with the effective removal from the public registry of companies on 12 April 2018.
Accordingly, it pays special attention to complying with its tax obligations in accordance with laws applicable in each territory. In 2018, the total fiscal contribution of Naturgy amounted to Euros 3,268 billion.
Since 2011, Naturgy has a Human Rights Policy approved by the Management Committee. In 2018, the policy was exhaustively analysed in order to ensure that it was completely in line with the UN Guiding Principles on Business and Human Rights.
The policy is particularly applicable in locations in which local legislation does not provide a sufficient level of protection for human rights. In these cases, Naturgy undertakes to guarantee a level of protection equivalent to the other areas in which it carries out its business.
Knowledge of and compliance with the policy are strengthened at the company through the communication and training plan, which includes an online course that is mandatory for all employees. Towards the end of 2018, the course had been completed by 7,508 people.
As indicated in the policy, the company is actively taking steps to include human rights matters in the process of analysing new investments, introducing this variable in any assessments of social impact.*The decrease with regard to 2017 is due to the unbundling and the sale of group subsidiaries
Training on human rights focuses on the characteristics of each of the countries in which Naturgy has contracted the services of security guards and the activities performed by the company in each of them, allowing a more specific and effective training.
In 2018, 633 security guards served in Spain, Morocco, Moldova, Argentina, Brazil, Chile, Mexico, Panama and the Dominican Republic, of which 597 (94.31%) participated in the different *The decrease with regard to 2017 is due to the unbundling and the sale of group subsidiaries refresher courses on the subject of private security, and 431 (68.09%) on courses to update knowledge and ways of acting in respect of human rights, dedicating a total of 2,941 hours.
Therefore, best practices are adopted, taking as reference initiatives such as the Voluntary Principles on Security and Human Rights, and the UN Basic Principles on the Use of Force and Firearms for staff belonging to surveillance and security companies that the company hires.
In Spain, in the area of retailers, in 2018 there has been a fine of Euros 600,000, non-appealable, for failing to comply with the Administration’s requirement that a contract be terminated.
In addition, in 2018 two fines –imposed
in 2014– on Trillo and Almaraz nuclear
power plants were confirmed, as they
did not legally adapt in time, for an amount of Euros 1,035,000 and Euros
In Chile, CGE has been subject to an administrative fine, amounting to Euros 413,681 –upheld by the Court of Appeals and pending filing with the Supreme Court– for an infraction of article 139 of the General Electric Services Law (lack of maintenance) for a fault on the 66 kV Los Peumos -Curacautín line, which affected 11,002 customers for four hours and three minutes.
There have been no fines for monopolistic practices.
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