The case for CSR/ Sustainability Reporting Done Responsibly


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Case study: How MPC promotes compliance and ethical business conduct

Marathon Petroleum Corporation (MPC) is a leading, integrated, downstream energy company operating the United States’ largest refining system. MPC’s commitment to integrity is embedded in every aspect of its operations  Tweet This!, reflected in its comprehensive compliance and ethics programmes and in MPC’s meaningful and honest evaluation of risks and opportunities.

This case study is based on the 2019 Sustainability Report by MPC 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.

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MPC’s Code of Business Conduct requires that all employees immediately report any suspected illegal or unethical conduct connected with the business of MPC or its affiliates. In order to promote compliance and ethical business conduct MPC took action to:

  • promote legal compliance
  • implement a Code of Business Conduct
  • apply a Human Rights Policy
  • implement a Code of Ethics for Senior Financial Officers
  • provide an anonymous Integrity Helpline

What are the material issues the company has identified?

In its 2019 Sustainability Report MPC identified a range of material issues, such as diversity and inclusion, water use and conservation, cybersecurity, spill prevention, workforce safety, air quality and emissions. Among these, promoting compliance and ethical business conduct stands out as a key material issue for MPC.

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:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

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 MPC engages with: 

To identify and prioritise material topics MPC engaged with its stakeholders through the following channels:

Stakeholder Group                Method of engagement
Employees ·      Code of Business Conduct

·      Integrity Helpline

·      Employee satisfaction survey

·      Performance management

·      Safety meetings

·      CEO communications

·      Employee Network Groups

·      Wellness programmes

Business Partners ·      Procurement process

·      Stakeholder interviews

·      Contract negotiations

·      Core contractor programme

·      Project management

Customers

 

·      Global, regional and local industry events, forums and conferences

·      Proprietary company events and meetings

·      Partnerships and working groups to advance best practices

Communities

 

·      Websites, news media and social media

·      Community investment programmes

·      Community engagement

·      Employment

·      Landowner events

·      Focus groups

·      Community surveys

·      Tours

·      Community hotlines

·      Community Advisory Panels

·      Facilitation of community events

·      Sponsorship of charity fundraising events

Governments ·      Advocacy

·      Policy development

·      Industry and trade association representation

·      Regulatory compliance

·      Permit reviews

·      Regulatory audits

·      Leadership and collaboration on community investment projects

·      Legislator engagement days

·      Tours

·      Marathon Petroleum Corporation Employees Political Action Committee

Shareholders ·      Investor presentations and conferences

·      Analyst calls

·      Annual Shareholder Meeting

·      SEC filings

What actions were taken by MPC to promote compliance and ethical business conduct?

In its 2019 Sustainability Report MPC reports that it took the following actions for promoting compliance and ethical business conduct:

  • Promoting legal compliance
  • MPC is subject to laws and regulations covering all aspects of its operations. With respect to its employees, MPC complies with legal requirements governing safety, workers’ rights and minimum wage, and equal employment opportunity. MPC’s approach to environmental stewardship goes beyond compliance, with evolving laws and regulations to include implementation of proactive initiatives to safeguard the environment and the communities where MPC lives and works. MPC not only expects its employees to be knowledgeable about applicable legal requirements and act accordingly, but also selects contractors, suppliers and other business partners that demonstrate a similar commitment to legal and regulatory compliance.
  • Implementing a Code of Business Conduct
  • MPC’s Code of Business Conduct is framed by law, but most importantly it is based on the principle that MPC does the right thing. The Code defines expectations for ethical decision-making, accountability and responsibility for every employee at all levels of MPC, including those providing services to MPLX. MPC requires Code of Business Conduct training and a new hire questionnaire for all MPC employees at hire. MPC salaried employees are required to complete an annual Code of Business Conduct certification. This includes a questionnaire and provides the opportunity for employees to disclose issues that could present a violation of the Code. MPC’s business partners, including suppliers, consultants and contract workers, are expected to comply with the Code, as well as the law, and to support effective compliance programmes in their own organisations. In 2020, MPC also announced a Supplier Code of Conduct. MPC’s Code of Business Conduct includes the following key provisions:
    • Anti-Corruption and Bribery
    • Anti-Discrimination and Anti-Harassment
    • Anti-trust and Fair Competition
    • Conflicts of Interest
    • Insider Trading
    • Money Laundering
  • Applying a Human Rights Policy
  • MPC’s and MPLX’s Human Rights Policy represents MPC’s commitment to respect the human, cultural and legal rights of all individuals and communities. MPC promotes the goals and principles of the United Nations Declaration of Human Rights and meets the expectations of the Voluntary Principles on Security and Human Rights. MPC seeks to engage and inform its stakeholders and the communities where it operates and promotes the well-being of its employees by providing competitive compensation and benefits, maintaining safe and healthy work environments, respecting their freedom to associate and collectively bargain, and promoting diversity and inclusion. MPC prohibits harassment and discrimination and the use of coerced, forced and child labour.
  • Implementing a Code of Ethics for Senior Financial Officers
  • MPC’s President and CEO, CFO (chief financial officer), controller, treasurer and other leaders performing similar roles are subject to its Code of Ethics for Senior Financial Officers. This separate Code of Ethics affirms the principles of honesty, integrity and sound judgment expected of MPC’s senior executives with responsibility for preparation and certification of its financial statements. In responding to and reporting any alleged Code of Ethics violation, MPC’s Business Integrity and Compliance organisation has direct access to the Chairman, CEO, CFO, Vice President Audit, and the chair of the Audit Committee. MPC’s Whistleblowing as to Accounting Matters Policy specifically addresses complaints received by the company regarding accounting, internal accounting controls or auditing matters. This policy establishes procedures for the receipt, retention and treatment of allegations of unethical behaviour and provides for the confidential, anonymous submission of concerns regarding questionable accounting matters.
  • Providing an anonymous Integrity Helpline
  • MPC’s Integrity Helpline serves as a resource for its employees, contractors, vendors and customers to ask questions or raise allegations related to workplace behaviour or ethics. While MPC always encourages speaking with an immediate supervisor or other designated personnel, the Integrity Helpline provides the opportunity to speak on an anonymous basis. Every allegation received through the Integrity Helpline is investigated in a manner and to the extent appropriate based on the nature of the allegation, with the goal to resolve the matter within 90 days. Investigations may result in discipline where warranted, a change in policy or procedure, or a determination that an allegation of unlawful and/or unethical behaviour could not be substantiated. MPC maintains a firm no-retaliation policy and will never permit a good-faith submission to be a cause for disciplinary action. Integrity Helpline statistics are reported to the Audit Committee of MPC’s Board of Directors, with certain allegations escalated quickly. These include certain allegations regarding financial statements and reporting and allegations of Code violations by MPC’s directors or officers.

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 

 

Disclosure 205-1 Operations assessed for risks related to corruption corresponds to:

Disclosure 205-2 Communication and training about anti-corruption policies and procedures corresponds to:

 

80% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.



FBRH GRI Standards Certified, IEMA & CIM recognised Sustainability Course | Venue: London LSE

By registering for the next 2-day FBRH GRI Standards Certified, IEMA & CIM recognised course you will be taking the first step in gaining the many benefits of sustainability reporting.

Most importantly, you will gain the knowledge to use the GRI Standards, project manage your own first-class sustainability report and:

  • Identify your most important impacts on the Environment, Economy and Society
  • Begin taking solid, focused, all-round sustainability action ASAP

 

References:

1) This case study is based on published information by MPC, 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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