Corporate Governance, Sustainable

Development and Value Creation

Alex Almici – University of Brescia (Italy)

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

CORPORATEGOVERNANCE

SUSTAINABLEDEVELOPMENT

COMPANY’S VALUE CREATION(economic, social, competitive

and environmental success)

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

COMPANIESSELECTED

PUBLICUTILITIES

LISTED ON ITALIAN STOCKEXCHANGE BY

THE 31 JANUARY 2011(17 COMPANIES)

INFORMATIONANALYSED

SUSTAINABILITYREPORT

2007-2009

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

1. DO COMPANIES IMPLEMENT CORPORATE GOVERNANCE SYSTEMS

PROMOTING SUSTAINABLE DEVELOPMENT?

CORPORATE GOVERNANCE

SUSTAINABLE DEVELOPMENT

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

1. DO COMPANIES IMPLEMENT CORPORATE GOVERNANCE SYSTEMS

PROMOTING SUSTAINABLE DEVELOPMENT?

1. DO PUBLIC UTILITIES COMMUNICATE(DO THEY ARRANGE A SUSTAINABILITY REPORT)?

2. HOW DO PUBLIC UTILITIES COMMUNICATE(HOW IS THE QUALITY OF THE SUSTAINABILITYREPORT)?

3. WHAT DO PUBLIC UTILITIES COMMUNICATE(WHAT’S THE CONTENT OF THE SUSTAINABILITY REPORT)?

GRIguidelines

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

1. DO PUBLIC UTILITIES COMMUNICATE(DO THEY ARRANGE A SUSTAINABILITY REPORT)?

6 PUBLIC UTILITIES OUT OF 17 (35%)

Public utilities that draw

up the sustainability report

Listing First sustainability report

A2A 2008 2008

ACEA 1999 2002

EDISON 2002 2004

ENEL 1999 2002

HERA 2003 2003

IREN - IRIDE 2000 2006

First sustainability report and Italian Stock Exchange listing

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

2. HOW DO PUBLIC UTILITIES COMMUNICATE(HOW IS THE QUALITY OF THE

SUSTAINABILITY REPORT)?6 PUBLIC UTILITIES OUT OF 6

No. of companies

2007

No. of companies 2008

No. of companies

2009

Reference to the

GRI Guidelines 5* 6 6

Model adopted for carrying out the sustainability report

*With regard to 2007, the number of companies considered is 5 instead of 6 because A2A was founded in 2008

Corporate Governance, Sustainable Development and Value Creation

2. HOW DO PUBLIC UTILITIES COMMUNICATE(HOW IS THE QUALITY OF THE

SUSTAINABILITY REPORT)?Compliance degree as regards the GRI Guidelines

Compliance degree

No. of companies

2007

No. of companies

2008

No. of companies

2009

C

C+

B

B+ 2 1 1

A

A+ 3 4 5

not declared 1

Corporate Governance, Sustainable Development and Value Creation

2. HOW DO PUBLIC UTILITIES COMMUNICATE(HOW IS THE QUALITY OF THE

SUSTAINABILITY REPORT)?

Revision by an external subject

4 companies out of 5 in 2007

4 companies out of 6 in 2008

5 companies out of 6 in 2009

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

3. WHAT DO PUBLIC UTILITIES COMMUNICATE (WHAT’S THE CONTENT OF THE

SUSTAINABILITY REPORT)?

Alex Almici – University of Brescia (Italy)

ECONOMIC RESPONSIBILITY

ENVIRONMENTAL RESPONSIBILITY

SOCIAL RESPONSIBILITY

Shared value added, amount of investments aimed at fighting

the problem of climatic change, expense percentage that can be ascribed to

local suppliers

Raw materials used, consumption of directenergy, greenhouse effect gas emission,

waste material produced, total water collecting

Staff turnover rate, accidents at thework place, average training hours,

etc.

Corporate Governance, Sustainable Development and Value Creation

Alex Almici – University of Brescia (Italy)

ECONOMIC RESPONSIBILITY

No. of companies

2007

No. of companies

2008

No. of companies

2009

Value added

distributed

5 6 6

No. of companies

2007

No. of companies

2008

No. of companies

2009

Total investments 3 3 3

Distribution of the value added to the stakeholders above 60%

Investments above € 1.000.000 for the management of climatic changes

6 COMPANIES OUT OF 6

3 PUBLIC UTILITIES OUT OF 6

Corporate Governance, Sustainable Development and Value Creation

Alex Almici – University of Brescia (Italy)

ECONOMIC RESPONSIBILITY

No. of companies

2007

No. of companies

2008

No. of companies

2009

Expenses percentage

3 3 3

Expenses percentage above 70% referable to local suppliers

3 COMPANIES OUT OF 6

Corporate Governance, Sustainable Development and Value Creation

Alex Almici – University of Brescia (Italy)

ENVIRONMENTAL RESPONSIBILITY

Environmental performance trend in 2007-2009

3 COMPANIES OUT OF 6

No. of companies- diminishing trend

No. of companies –

growing trend

Raw materials consumption

3 3

Electric Energy consumption

3 3

Total water collecting 4 2

Green house effect

Gas emission

3 3

Total waste weight 3 3

Corporate Governance, Sustainable Development and Value Creation

Alex Almici – University of Brescia (Italy)

SOCIAL RESPONSIBILITY

Turnover rate below 9%

5 COMPANIES OUT OF 6

No. of companies

2007

No. of companies

2008

No. of companies

2009

Employees Turnover rate

4 5 5

Corporate Governance, Sustainable Development and Value Creation

Alex Almici – University of Brescia (Italy)

SOCIAL RESPONSIBILITY

Frequency of Accidents at work place below 10

3 COMPANIES OUT OF 6

No. of companies

2007

No. of companies

2008

No. of companies

2009

Accidents on working place

frequency indicator

3 3 3

Corporate Governance, Sustainable Development and Value Creation

Alex Almici – University of Brescia (Italy)

SOCIAL RESPONSIBILITY

Yearly training hours above 20

4 COMPANIES OUT OF 6

No. of companies

2007

No. of companies

2008

No. of companies

2009

Avarage training

hours per year

4 4 4

Corporate Governance, Sustainable Development and Value Creation

Alex Almici – University of Brescia (Italy)

SOCIAL RESPONSIBILITY

Discriminating practices episodes

0 COMPANIES OUT OF 6

Presence of sanctions

0 COMPANIES OUT OF 6

Corporate Governance, Sustainable Development and Value Creation

Alex Almici – University of Brescia (Italy)

SOCIAL RESPONSIBILITY

ECONOMIC RESPONSIBILITY

ENVIRONMENTAL RESPONSIBILITY

ONLY 3COMPANIES

OUT OF 6

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

1. HAVE COMPANIES PROMOTING SUSTAINABLE DEVELOPMENT

DISTINGUISHED THEMSELVES FOR THE VALUE THEY CREATED?

CORPORATE GOVERNANCE

SUSTAINABLE DEVELOPMENT

COMPANY’S VALUE

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

1. HAVE COMPANIES PROMOTING SUSTAINABLE DEVELOPMENT

DISTINGUISHED THEMSELVES FOR THE VALUE THEY CREATED?

- AVERAGE PROCEEDS OF SALES (2007 – 2009) NON INFERIOR TO € 1.000.000.000,00 - COMPETITIVE SUCCESS

- AVERAGE EBITDA ABOVE 200.000.000 – ECONOMIC SUCCESS

- INCLUSION IN THE BASKET FOR THE ELABORATIONOF THE ETHIC INDEX FTSE4GOOD EUROPE – SOCIALAND ENVIRONMENTAL SUCCESS INDICATOR

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

1. HAVE COMPANIES PROMOTING SUSTAINABLE DEVELOPMENT

DISTINGUISHED THEMSELVES FOR THE VALUE THEY CREATED?

ONLY ONE COMPANY, AMONG THOSE PROMOTINGSUSTAINABLE DEVELOPMENT, SATISFIES ALL

CONDITIONS (ECONOMIC, COMPETITIVE, SOCIAL AND EVIRONMENTAL)

Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation

1. DO COMPANIES PROMOTING SUSTAINABLE DEVELOPMENT

DISTINGUISHED THEMSELVES FOR THE VALUE THEY CREATED?

THOSE PUBLIC UTILITIES THAT DON’TCARRY OUT A SUSTAINABILITY REPORT(10 IN TOTAL) DON’T MEET ANY OF THE CONDITIONS REQUESTED IN ORDER TO CREATE VALUE IN MEDIUM-LONG TERM