Relevant Issues (5 of 26)
Why are some issues greyed out?The SASB Standards vary by industry based on the different sustainability-related risks and opportunities within an industry. The issues in grey were not identified during the standard-setting process as the most likely to be useful to investors, so they are not included in the Standard. Over time, as the ISSB continues to receive market feedback, some issues may be added or removed from the Standard. Each company determines which sustainability-related risks and opportunities are relevant to its business. The Standard is designed for the typical company in an industry, but individual companies may choose to report on different sustainability-related risks and opportunities based on their unique business model.
GHG EmissionsThe category addresses direct (Scope 1) greenhouse gas (GHG) emissions that a company generates through its operations. This includes GHG emissions from stationary (e.g., factories, power plants) and mobile sources (e.g., trucks, delivery vehicles, planes), whether a result of combustion of fuel or non-combusted direct releases during activities such as natural resource extraction, power generation, land use, or biogenic processes. The category further includes management of regulatory risks, environmental compliance, and reputational risks and opportunities, as they related to direct GHG emissions. The seven GHGs covered under the Kyoto Protocol are included within the category—carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulfur hexafluoride (SF6), and nitrogen trifluoride (NF3).
Air QualityThe category addresses management of air quality impacts resulting from stationary (e.g., factories, power plants) and mobile sources (e.g., trucks, delivery vehicles, planes) as well as industrial emissions. Relevant airborne pollutants include, but are not limited to, oxides of nitrogen (NOx), oxides of sulfur (SOx), volatile organic compounds (VOCs), heavy metals, particulate matter, and chlorofluorocarbons. The category does not include GHG emissions, which are addressed in a separate category.
- Energy Management
- Water & Wastewater Management
- Waste & Hazardous Materials Management
Ecological ImpactsThe category addresses management of the company’s impacts on ecosystems and biodiversity through activities including, but not limited to, land use for exploration, natural resource extraction, and cultivation, as well as project development, construction, and siting. The impacts include, but are not limited to, biodiversity loss, habitat destruction, and deforestation at all stages – planning, land acquisition, permitting, development, operations, and site remediation. The category does not cover impacts of climate change on ecosystems and biodiversity.
- Human Rights & Community Relations
- Customer Privacy
- Data Security
- Access & Affordability
- Product Quality & Safety
- Customer Welfare
- Selling Practices & Product Labeling
- Labour Practices
- Employee Health & Safety
- Employee Engagement, Diversity & Inclusion
Business Model and Innovation
- Product Design & Lifecycle Management
- Business Model Resilience
- Supply Chain Management
- Materials Sourcing & Efficiency
- Physical Impacts of Climate Change
Leadership and Governance
- Business Ethics
Competitive BehaviourThe category covers social issues associated with existence of monopolies, which may include, but are not limited to, excessive prices, poor quality of service, and inefficiencies. It addresses a company’s management of legal and social expectation around monopolistic and anti-competitive practices, including issues related to bargaining power, collusion, price fixing or manipulation, and protection of patents and intellectual property (IP).
- Management of the Legal & Regulatory Environment
Critical Incident Risk ManagementThe category addresses the company’s use of management systems and scenario planning to identify, understand, and prevent or minimize the occurrence of low-probability, high-impact accidents and emergencies with significant potential environmental and social externalities. It relates to the culture of safety at a company, its relevant safety management systems and technological controls, the potential human, environmental, and social implications of such events occurring, and the long-term effects to an organization, its workers, and society should these events occur.
- Systemic Risk Management
Disclosure Topics (Industry specific) for: Oil & Gas – Midstream
Greenhouse Gas Emissions
The Midstream industry generates significant greenhouse gases and other air emissions from compressor engine exhausts, oil and condensate tank vents, natural gas processing, and fugitive emissions, in addition to emissions from mobile sources. GHG emissions contribute to climate change and create incremental regulatory compliance costs and risks for Midstream entities. At the same time, the management of methane fugitive emissions has emerged as a significant operational, reputational and regulatory risk. Financial effects on entities will vary depending on the specific location of operations and prevailing emissions regulations, and they include increased operating or capital expenditures and regulatory or legal penalties. Entities that capture and monetise emissions, or cost-effectively reduce emissions by implementing innovative monitoring and mitigation efforts and fuel efficiency measures, may enjoy substantial financial benefits. Entities can reduce regulatory risks and realise operational efficiencies as regulatory and public concerns about air quality and climate change increase.
Air emissions from Oil & Gas – Midstream entities include air pollutants, which can create significant and localised environmental or health risks. Of particular concern are sulphur dioxide, nitrogen dioxide and volatile organic compound (VOC) emissions. The financial consequences entities face from air emissions vary depending on the specific locations of operations and the prevailing air emissions regulations. Amid increasing regulatory and public concerns about air quality, active air quality management through technological and process improvements could allow entities to mitigate the adverse financial effects of regulations. Entities could benefit from operational efficiencies that may result in a lower cost structure over time.
The storage and transport of crude oil, natural gas and related products through a vast system of maritime transportation vehicles, pipelines, trains and trucks presents considerable risks to the environment and local communities. Leaks, accidental discharges, pipeline rights-of-way and open easements over ecologically sensitive land could negatively impact ecosystems in several ways, including natural habitat loss and changes in species movement. To protect endangered species and ecologically sensitive areas, jurisdictional legal and regulatory authorities may require development and decommissioning plans that mitigate or remediate potential ecological impacts prior to project approval. Together with regulatory compliance costs, these plans may require significant capital and operational expenditures. As concerns over ecological impacts increase, greenfield and existing developed sites may be designated as protected areas under new laws or the enforcement of existing laws. Entities that effectively manage ecological impacts may avoid project delays, remediation and litigation liabilities, and could gain easier access to new projects and sources of revenue.
Entities that own natural gas pipelines and storage facilities face numerous and constantly changing regulations in all aspects of their operations, including the rates charged, common carrier access and new facility siting and construction. Many pipelines and terminals enjoy natural monopolies, and regulations ensure that entities do not abuse this position through unfair pricing, discriminatory service or by other means. Because of concerns about the effects of oil and gas market distortions on consumers and businesses, market manipulation regulations could also affect entities in the Midstream industry. Prospective rate changes, compensation payments or regulatory penalties for violating regulations governing competitive behaviour may adversely affect entities. Midstream entities face uncertainty regarding their ability to change the rates charged, which could affect their ability to recover higher costs.
Operational Safety, Emergency Preparedness & Response
Entities in the Oil & Gas – Midstream industry operate a vast network of assets at risk of spills and accidents. Any incident that results in unintended hydrocarbon releases could have severe impacts on the environment, employees and local communities. Because of these concerns, applicable jurisdictional legal and regulatory authorities may implement new safety regulations related to pipeline and rail operations. Significant events may result in large one-time costs from fines and corrective actions, and contingent liabilities for remediation or legal damages. These factors also could impair an entity’s social licence to operate. As demonstrated by investigations of past incidents, an entity that develops a strong safety culture and establishes a thorough and systematic approach to safety and risk management may minimise such risks. This includes emergency preparedness and response and operational integrity within the entity and in its external relationships with contractors.