SNAM Annual Report 2016 - Information about this Report

Value creation and sustainability (Photo)

Information about this report

The content of the integrated Report is presented in accordance with the indications of the Framework recommended by the IIRC (International Integrated Reporting Council). The objective of the document is to represent, in addition to annual operating results, Snam’s model for the creation of value and the sustainability of the business over the medium and long term, thereby indicating and demonstrating the interconnections between strategy, governance, business and financial performance, and the social, environmental and economic environment in which the enterprise operates.

The aspects covered by the Report represent the principal factors that have a potential impact on business and financial performance and material sustainability issues.

The following schedules facilitate reconciliation of the various keys to reading and interpretation recommended by the IIRC Framework and the content of the Report.

References in the integrated report to the iirc framework disclosure points
Report headings	IRC Framework disclosure points
Snam today Creation of value and sustainability	Presentation of the enterprise and the external environment: What does the enterprise do and what are the circumstances in which it operates?
Creation of value and sustainability	Business Model: what activities are performed by the organisation and how do they relate to the capitals used by the organisation to create value?
Snam today Creation of value and sustainability	Governance: how does the organisation’s governance structure support its ability to create value in the short, medium and long term?
Creation of value and sustainability Summary data and information	Resource allocation and strategy: where does the organisation want to go and how does it intend to get there?
Summary data and information Business segment operating performance Other operating information and results Financial review	Performance: to what extent has the organisation achieved its strategic objectives for the period and what are the outcomes in terms of effects on the capitals?
Elements of risk management and uncertainty	Risks and Opportunities: what are the specific risks and opportunities that affect the organisation’s ability to create value over the short, medium and long term?
Creation of value and sustainability Outlook	Prospects: what challenges and uncertainties is the organisation likely to encounter in pursuing its strategy, and what are the potential implications for its business model and future performance?

References in the integrated report to value creation
Time frames and dynamics	Value-creation methods	Main operating activities	Report headings
In the short term, value creation is tied to the ordinary performance of corporate activities in accordance with the methods prescribed by rules and procedures, particularly in relation to risk management. The main point of reference is the annual budget
	Maintaining the efficiency and availability of the network	Executing the scheduled works
		Maintenance
		Controls and inspections


	Service quality and continuity	Compliance with the network codes
	Service quality and continuity

In the medium term, the ability to carry out investment programmes, thereby ensuring a flow of resources and that favourable economic conditions are maintained, is also important. The main point of reference is the Business Plan, which covers a period of five years	Preventing and mitigating risks and detrimental outside forces	Managing financial risks
		Managing operating risks
		Managing partnership portfolios
		Managing crises
		Preventing accidents
		Mitigating environmental impact


	Consistent information flows	Planning infrastructure development
		Obtaining financial resources on the market
		Permissions


In the long term, it is vital that the investment decisions and strategic choices made have interpreted trends in the best way possible. The main point of reference is the infrastructure development plan submitted to the Authority, which covers a period of 10 years	Maintaining and developing human and relationship capital	Relationships with the authorities
		Managing the supply chain in relation to the development of construction sites
		Developing roles and capabilities
		Managing relations with local communities
		Development of partnerships in order to increase alternative uses of gas


	Ensuring that strategic guidelines and development plans are consistent with the environment in the reference sector	Planning infrastructure development
		Snam’s strategy
		Gas advocacy


Legend
Summary data and information
Snam and the financial markets
Business segment operating performance
Uncertainty and risk management
Other operating information and results
Value creation and sustainability

References in the integrated report to capital management
Type of capital	Description and specific reference to the Snam model	Report headings
Financial	The fundamental input for making investments in gas system infrastructure. We fund these investments using our own resources and debt capital obtained either on the financial markets or through our own operating income
Manufactured	The network of infrastructure for transporting, storing and regasifying LNG, required to perform services for operators and users
Intellectual	Unique to Snam, this consists mainly of the IT systems, procedures and good operating practices developed over time by managing the business
Human	This includes the specific skills and experience acquired by our staff, primarily by way of internal development programmes (this is essentially a self-made capital), and the business culture with its distinctive values, above all a culture of safety
Social and relationship	This is the licence to operate, sustained by relations with these stakeholders at European and national levels, as well as by Snam’s presence in the areas that host its infrastructure In perspective, Snam’s ability to be recognised as a pillar for the development of Sistema Gas shall become increasingly more important
Natural	The land, air and biodiversity that Snam is committed to preserving through efficient and responsible environmental management, mitigating the environmental impacts and consequences generated predominantly during the construction of infrastructure

Legend
Summary data and information
Snam and the financial markets
Business segment operating performance
Elements of uncertainty and risk management
Other operating information and results