Note on methodology
GRI - G4: 13, 17, 18, 20, 21, 22, 23, 28, 29, 30, 31, 32, 33

Snam Sustainability Report, now at the ninth edition of publishing, is drawn up annually, following the same timeframe of the consolidated financial statements. The report is the main channel used to communicate the Group’s values, commitments, strategies and results about the sustainable development and the corporate social responsibility.

The document completes the disclosure to the stakeholders provided in the Annual Report, with physical and economics data and environmental, social and governance (ESG) performance indicators about Snam different businesses:

• Corporate (Snam S.p.A along with the subsidiary Gasrule Insurance Limited);
• Transportation (Snam Rete Gas S.p.A.);
• Liquefied natural gas regasification (GNL Italia S.p.A.);
• Storage (Stogit S.p.A.);
• Distribution (Italgas S.p.A along with the subsidiaries Napoletanagas and A.E.S. – Azienda Energia e Servizi Torino S.p.A.).

Scope and criteria of consolidation

This Report contains data and information for the year ending on the 31 December 2014 with the exception of information on corporate governance and ownership structure, which is instead updated to the publication date of the Report.

The scope of reporting was broadened as compared to the previous year, and now includes the operations of A.E.S., a company operating in the distribution of natural gas, which has been a wholly-owned subsidiary of Italgas since 1 July 2014, and the new company Gasrule Insurance Limited.

There are no differences in the consolidation criteria used compared to what was indicated in the Annual Report.

Reporting process and procedures

The process of collecting data and information and preparing the Report was coordinated and managed by the Sustainability unit of the parent company, Snam, in cooperation with the various corporate departments and the operating companies. Publication of the document, at the same time as the publication of the Annual Report, was subject to approval by the Snam Board of Directors on 11 March 2015.

Financial, operating and governance data are reported directly in the Annual Report and Report on Corporate Governance and Ownership Structure. Data on the environment, staff and the other aspects covered in this document are collected directly from the competent departments.

The calculation methods used to determine the various figures are indicated in the specific related sections. To ensure the comparability over time of the indicators deemed most significant and to give the reader the ability to compare performance achieved, current values have been placed alongside those for the previous two years, using graphs and tables. In the report, an attempt was made to give equal weighting to positive and negative aspects by providing, when deemed appropriate, comments on results achieved, including the events and matters that affected the Group in 2014.

The content of the Report is integrated with additional information published in the sustainability section of the website www.snam.it.

Application of the GRI-G4 guidelines

The document was drafted in accordance with the most recent version (G4) of the Reporting Guidelines of the Global Reporting Initiative, published in May 2013.

The extent and the detail of reporting of the issues covered in the report reflect the results of the analysis of materiality completed on the basis of a specific methodology and updated annually as a part of the cycle to plan commitments and sustainability activities. Note that the 2014 update especially affected evaluations of the market situation and environment.

With regard to the material aspects for which reporting has not been extended to the external scope (G4- omissions), Snam undertakes to implement specific actions in the coming years to enable the reporting scope to be progressively broadened.

For the purposes of the application of the G4 standard, the results from the materiality analysis are combined with the list of material aspects listed in the standard. The result is indicated in the corresponding table above.

On the basis of the coverage of the standard disclosures and indicators associated with the material aspects, the level of adherence to the G4 standard self-declared by Snam is “In accordance – comprehensive”.

Post-balance sheet events

Pineto incident

The public prosecutor of Teramo has opened an investigation in relation to the incident that occurred on 6 March 2015 near the town of Pineto, concerning a gas leak in a section of pipeline. The reasons for the leak and subsequent fire are being examined. In the short term, the infrastructure was secured by stopping the gas leak and facilitating the extinguishment of the fire.

Snam Rete Gas is actively cooperating with the relevant authorities.

Assurance

The Report was audited by the company appointed to do the audit (Reconta Ernst & Young S.P.A.) based on the principles and guidelines of the International Standard on Assurance Engagements (ISAE 3000) issued by the International Auditing and Assurance Standards Board (IAASB). The audit results are included in the compliance certification appended to this Report.