Corporate Governance Sustainable Development and Value Creation Alex

Corporate Governance, Sustainable Development and Value Creation Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation CORPORATE GOVERNANCE SUSTAINABLE DEVELOPMENT COMPANY’S VALUE CREATION (economic, social, competitive and environmental success) Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation COMPANIES SELECTED PUBLIC UTILITIES LISTED ON ITALIAN STOCK EXCHANGE BY THE 31 JANUARY 2011 (17 COMPANIES) INFORMATION ANALYSED SUSTAINABILITY REPORT 2007 -2009 Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation CORPORATE GOVERNANCE SUSTAINABLE DEVELOPMENT 1. DO COMPANIES IMPLEMENT CORPORATE GOVERNANCE SYSTEMS PROMOTING 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 SUSTAINABILITY REPORT)? 3. WHAT DO PUBLIC UTILITIES COMMUNICATE (WHAT’S THE CONTENT OF THE SUSTAINABILITY REPORT)? Alex Almici – University of Brescia (Italy) GRI guidelines

Corporate Governance, Sustainable Development and Value Creation 1. DO PUBLIC UTILITIES COMMUNICATE 2. (DO THEY ARRANGE A SUSTAINABILITY REPORT)? 3. 6 PUBLIC UTILITIES OUT OF 17 (35%) First sustainability report and Italian Stock Exchange listing Public utilities that draw up the sustainability report Listing First sustainability report A 2 A 2008 ACEA 1999 2002 EDISON 2002 2004 ENEL 1999 2002 HERA 2003 IREN - IRIDE 2000 2006 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 Model adopted for carrying out the sustainability report No. of companies 2008 2007 2009 Reference to the GRI Guidelines 5* 6 6 *With regard to 2007, the number of companies considered is 5 instead of 6 because A 2 A was founded in 2008 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)? Compliance degree as regards the GRI Guidelines Compliance degree No. of companies 2007 No. of companies 2008 No. of companies 2009 2 1 1 3 4 5 C C+ B B+ A A+ 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)? 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 direct energy, greenhouse effect gas emission, waste material produced, total water collecting Staff turnover rate, accidents at the work place, average training hours, etc. Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation ECONOMIC RESPONSIBILITY Distribution of the value added to the stakeholders above 60% Value added distributed No. of companies 2007 No. of companies 2008 No. of companies 2009 5 6 6 6 COMPANIES OUT OF 6 Investments above € 1. 000 for the management of climatic changes No. of companies 2007 2008 2009 Total investments 3 3 3 PUBLIC UTILITIES OUT OF 6 Alex Almici – University of Brescia (Italy) 3

Corporate Governance, Sustainable Development and Value Creation ECONOMIC RESPONSIBILITY Expenses percentage above 70% referable to local suppliers Expenses percentage No. of companies 2007 No. of companies 2008 No. of companies 2009 3 3 COMPANIES OUT OF 6 Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation ENVIRONMENTAL RESPONSIBILITY Environmental performance trend in 2007 -2009 No. of companiesdiminishing 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 3 COMPANIES OUT OF 6 Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation SOCIAL RESPONSIBILITY Turnover rate below 9% Employees Turnover rate No. of companies 2007 No. of companies 2008 No. of companies 2009 4 5 5 5 COMPANIES OUT OF 6 Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation SOCIAL RESPONSIBILITY Frequency of Accidents at work place below 10 Accidents on working place frequency indicator No. of companies 2007 No. of companies 2008 No. of companies 2009 3 3 COMPANIES OUT OF 6 Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation SOCIAL RESPONSIBILITY Yearly training hours above 20 Avarage training hours per year No. of companies 2007 No. of companies 2008 No. of companies 2009 4 4 COMPANIES OUT OF 6 Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation SOCIAL RESPONSIBILITY Discriminating practices episodes 0 COMPANIES OUT OF 6 Presence of sanctions 0 COMPANIES OUT OF 6 Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation ECONOMIC RESPONSIBILITY ENVIRONMENTAL RESPONSIBILITY ONLY 3 COMPANIES OUT OF 6 SOCIAL RESPONSIBILITY Alex Almici – University of Brescia (Italy)

Corporate Governance, Sustainable Development and Value Creation CORPORATE GOVERNANCE SUSTAINABLE DEVELOPMENT COMPANY’S VALUE 1. HAVE COMPANIES PROMOTING SUSTAINABLE DEVELOPMENT DISTINGUISHED THEMSELVES FOR THE VALUE THEY CREATED? 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, 00 - COMPETITIVE SUCCESS - AVERAGE EBITDA ABOVE 200. 000 – ECONOMIC SUCCESS - INCLUSION IN THE BASKET FOR THE ELABORATION OF THE ETHIC INDEX FTSE 4 GOOD EUROPE – SOCIAL AND 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 PROMOTING SUSTAINABLE 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’T CARRY OUT A SUSTAINABILITY REPORT (10 IN TOTAL) DON’T MEET ANY OF THE CONDITIONS REQUESTED IN ORDER TO CREATE VALUE IN MEDIUM-LONG TERM Alex Almici – University of Brescia (Italy)