Case study: How Parex promotes ethical business conduct
Parex Resources Inc. (Parex) is a publicly traded company that focuses on oil exploration, development and production. Building and maintaining the trust of stakeholders is a priority for Parex, and it is only possible through the ethical and transparent behaviours of the company’s employees and value chain.
This case study is based on the 2019 Sustainability Report by Parex published on the Global Reporting Initiative Sustainability Disclosure Database that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
Abstract
Parex seeks to make sure that all its business objectives are achieved in compliance with the law Tweet This!, while ensuring ethical and transparent conducts. In order to promote ethical business conduct Parex took action to:
- implement a Code of Conduct and Ethics
- apply a Complaint Policy
- combat money laundering
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With this case study you will see:
- Which are the most important impacts (material issues) Parex has identified;
- How Parex proceeded with stakeholder engagement, and
- What actions were taken by Parex to promote ethical business conduct
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What are the material issues the company has identified?
In its 2019 Sustainability Report Parex identified a range of material issues, such as economic performance, community investment, health and safety, greenhouse gas emissions, human rights. Among these, promoting ethical business conduct stands out as a key material issue for Parex.
Stakeholder engagement in accordance with the GRI Standards
The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:
Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.
Key stakeholder groups Parex engages with:
| Stakeholder Group |
| Community |
| Contractors and suppliers |
| Authorities |
| Civil society |
| Employees |
| Customers |
| Partners |
| Investors |
| Shareholders |
| Media |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics Parex engaged with its stakeholders through surveys and interviews of stakeholder groups’ representatives.
What actions were taken by Parex to promote ethical business conduct?
In its 2019 Sustainability Report Parex reports that it took the following actions for promoting ethical business conduct:
- Implementing a Code of Conduct and Ethics
- In its Code of Conduct and Ethics Parex sets the values, general principles and corporate guidelines to ensure honest, upright and responsible behaviours by its employees and all of those who are part of its value chain. The Code of Conduct and Ethics addresses key issues such as conflict of interest, confidentiality, protection of personal information, entertainment, gifts and favours, bribery and anti-corruption, compliance with laws, norms and regulations.
- Applying a Complaint Policy
- Parex has a Complaint Policy (Whistleblower) to ensure the effective management of reports, complaints and concerns regarding compliance with the Code of Conduct and Ethics, internal controls, auditing and accounting of the company. This policy also manages the possible violation of the Disclosure Policy, Confidentiality, Privileged Information & Policy of the Blackout Period and Procedures, the Environment Policy, Health and Safety, the Anti-Bribery and Anti-Corruption Policy, or any law or regulation of the jurisdiction where Parex Complaints can be made anonymously, if the reporter so prefers.
- Combating money laundering
- Parex has a System for the Self-Monitoring and Risk Management of Money Laundering and Financing of Terrorism and a Financing of the Propagation of Weapons of Mass Destruction Manual (ML/FT), which has been distributed to all employees. This manual conforms to international standards and complies with the regulations of the Superintendence of Companies in Colombia, where Parex develops 100% of its operations. In 2019, virtual training in ML/TF prevention was provided to 285 people, among which were direct and temporary employees of the different areas in Parex. During the year Parex used a compliance tool to perform queries on ML/TF lists. The number of user queries increased by 44% between 2018 and 2019 as new areas of monitoring were included and counterpart creation and update processes were increased. The results of the audits, auditor due diligence of third parties, as well as monitoring of PEP (Politically Exposed Persons) and cash operations, are presented quarterly to Parex’ Risk Committee.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standards addressed in this case are:
1) Disclosure 205-1 Operations assessed for risks related to corruption
2) Disclosure 205-2 Communication and training about anti-corruption policies and procedures
3) Disclosure 205-3 Confirmed incidents of corruption and actions taken
Disclosure 205-1 Operations assessed for risks related to corruption corresponds to:
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.5
Disclosure 205-2 Communication and training about anti-corruption policies and procedures corresponds to:
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.5
Disclosure 205-3 Confirmed incidents of corruption and actions taken corresponds to:
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.5
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References:
1) This case study is based on published information by Parex, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:
http://database.globalreporting.org/
2) https://www.globalreporting.org/standards/gri-standards-download-center/
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