Case study: How PPL promotes compliance and business integrity
Headquartered in Allentown, Pennsylvania, PPL is one of the largest companies in the U.S. utility sector, serving more than 10 million customers in the United States and United Kingdom and employing more than 12,000 people. To fulfill its obligation to shareowners and all others who have a stake in PPL’s business and the communities it serves, PPL must adhere to high ethical standards, work safely and responsibly, and comply with both the spirit and the letter of all laws and regulations that govern its business.
This case study is based on the 2019 Sustainability Report by PPL 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
PPL has established a compliance and ethics programme that is founded upon its Standards of Integrity Tweet This!, which, along with its Vision and Values, define the way PPL conducts its business. In order to promote compliance and business integrity PPL took action to:
- implement the Standards of Integrity
- provide an EthicsHelpline
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With this case study you will see:
- Which are the most important impacts (material issues) PPL has identified;
- How PPL proceeded with stakeholder engagement, and
- What actions were taken by PPL to promote compliance and business integrity
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What are the material issues the company has identified?
In its 2019 Sustainability Report PPL identified a range of material issues, such as economic viability, operational efficiency, emissions reduction, innovation and technology, workforce development. Among these, promoting compliance and business integrity stands out as a key material issue for PPL.
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 PPL engages with:
To identify and prioritise material topics PPL engaged with its stakeholders through the following channels:
Stakeholder Group | Method of engagement |
Communities
| · Support for events and programmes of nonprofits, chambers and associations · Support for community energy groups in the U.K. · Volunteerism (board service, events, long-term programmes) |
Customers
| · Websites · Consumer advisory panels · Customer commitment advisory forums · Market research · Demand-side management/energy efficiency advisory groups · Billing statements and messaging · Email newsletters · News releases and local media · Customer feedback (surveys, online comments, phone calls) · Account management · J.D. Power survey |
Employees | · Company intranet · Training events · Town hall meetings · Employee feedback (via surveys) · Volunteer programmes · Business resource groups · Performance reviews |
Facility neighbours
| · Plant advisory committees · Newsletters for plant neighbours |
Government (local, state, federal)
| · Continuous dialogue · Attendance at and participation in meetings and hearings with regulators and policymakers |
Industry associations
| Attendance at regular meetings and conferences and active participation in organisations such as: · Edison Electric Institute · Electric Power Research Institute · American Gas Association · Energy Networks Association (U.K.) · State chambers of commerce and industry associations |
Environmental groups
| · Ongoing discussions and partnerships around specific topics related to operational activities |
Shareowners
| · Continuous dialogue · Quarterly earnings news releases · Investor relations website · Active outreach including meetings at investor conferences, roadshows and conference calls |
Suppliers
| · Supplier meetings · Supplier networking summits |
What actions were taken by PPL to promote compliance and business integrity?
In its 2019 Sustainability Report PPL reports that it took the following actions for promoting compliance and business integrity:
- Implementing the Standards of Integrity
- PPL’s board expects its directors and all PPL officers to act ethically at all times and adhere to the policies set forth in PPL’s Standards of Integrity. Every member of the Board of Directors receives a copy of the Standards of Integrity. It is the responsibility of each director to advise the corporate secretary of any actual or potential conflict of interest and any affiliation with public or privately held enterprises, including for-profit and nonprofit entities that may create a potential conflict of interest to the company or inconsistency with applicable laws, company policies or values. Every employee is expected to read, understand and comply with the Standards of Integrity and associated company policies. In addition, employees are expected to report any compliance or ethics concerns to their immediate supervisors or via another appropriate reporting mechanism, including anonymous reporting mechanisms that are in place and publicised to employees. PPL takes any instance of noncompliance seriously. Failure to obey laws and regulations or violations of company policies may result in employee discipline to the extent permissible under applicable law, up to and including termination. Employees receive annual training on the Standards of Integrity. As part of the training, every employee is required to certify that he or she understands the expectation to report misconduct and understands that PPL will not tolerate any form of retaliation for any report made in good faith. All training is tracked, recorded and reported to executive leadership and the Audit Committee. Targeted communications on key compliance and ethics topics are also issued as needed.
- Providing an EthicsHelpline
- PPL employees are expected to ask questions or raise concerns about the application or interpretation of the Standards of Integrity. PPL does not discriminate against, or tolerate any form of retaliation toward, employees who ask questions or raise concerns in good faith, and provides an “EthicsHelpline” for confidential and, if desired, anonymous reporting of concerns. PPL’s EthicsHelpline toll-free phone number and internet site are available 24 hours a day, seven days a week. The EthicsHelpline, which is managed by an external vendor to promote confidence in confidentiality, is also accessible on the internet. In addition to employees, suppliers, customers and other external parties can use the EthicsHelpline to report concerns. Guidelines are in place for promptly responding to allegations of misconduct and include notifying the vice president and global chief compliance officer of the allegations, and this position has a dotted-line reporting relationship to the chair of the Audit Committee. Issues and trends are identified and reported to the Audit Committee. Allegations are handled and key statistics are reported to the Audit Committee each quarter, with the most serious allegations being reported on an expedited basis to the chair of the Audit Committee as soon as reasonably practicable after initial intake discussions.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standard addressed in this case is: Disclosure 205-2 Communication and training about anti-corruption policies and procedures
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
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References:
1) This case study is based on published information by PPL, 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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