Social aspects

Relevance and related risks

Material issues related to the social sphere regarding Snam’s activities are listed below:

• Reliability of infrastructures and business continuity: Snam works daily to ensure the reliability of its infrastructures and services in order to prevent and/or mitigate potential situations that could compromise the continuity of the business and public safety (e.g. emergencies, cyber attacks). For more information, please see the paragraph “Summary data and information – Maintenance of plant security and quality” of the Integrated Management Report.
• Innovation: in view of a more complex and challenging scenario, Snam has paid special attention to the search for new technologies from a perspective of increasing efficiency in conducting its business and reducing the impact on the environment. For more information, please see the paragraph “Innovation in business development” in the Integrated Management Report.
• Economic performance and creation of value: economic sustainability and business growth represent key objectives and factors that enable business activities as a whole. Promoting the creation of shared value in the medium-/long-term for all categories of stakeholders, through operational and financial efficiency and committing to the development of business activities capable of generating value for all Group stakeholders are fundamental issues for Snam.
• Relations with local communities: by creating and supporting projects for local communities, Snam intends to have a positive impact on the social fabric in the areas in which the company operates reinforcing the licence-to-operate.
• Brand reputation: Snam safeguards and values its reputation through constant communication, proactive and diversified, striving for dialogue with its reference public and seeking to expand it further. The company communicates through a multimedia, integrated strategy via traditional and digital channels, also involving its employees and partners as brand ambassadors, and through events and campaigns to confirm Snam’s centrality in the country system and as a player in energy transition, nationally and internationally, with a special focus on the areas and communities in which it operates. For more information, please see the paragraph “Stakeholders and relationship capital” in the Integrated Management Report.

The subject of the supply chain was not deemed to be material following the analysis conducted, but it is, however, monitored by Snam. The Group has, for some time, adopted policies for selecting suppliers, contractors and commercial partners based on fair and transparent processes which include the integration of sustainable criteria.

With regard to material issues concerning the social sphere, the most significant risks are linked to possible breaks in the pipes and the possible increase in the severity of extreme weather conditions as a result of climate change, which could have direct impacts on the continuity and quality of the service provided.

With reference, on the other hand, to the construction of new infrastructures, the main operational risk is related to possible delays in the progress of the construction works. As far as the Snam brand is concerned, the most significant risks are related to maintaining an adequate reputation profile vis a vis the major stakeholders and to possible violations of industry rules and regulations.

The complete list of social sphere risks is as follows⁵⁴:

• Risk related to climate change within Strategic risks;
• Risk related to maintaining an adequate reputation profile for suppliers and subcontractors within Legal and non-compliance risks;
• Possible violation of rules and regulations within Legal and non-compliance risks;
• Risk of delay in the progress of programmes for constructing infrastructures within Operational risks;
• Risk of breaks in or damage to pipes within Operational risks;
• Risk of cyber threats within Operational risks.

Policies, commitments and management model

Snam, in line with the guidelines of its Stakeholder Engagement Policy, maintains regular and frequent relations with local government bodies and with local stakeholder associations to share projects for new facilities.

Snam’s business development model is based on sustainable growth and the promotion of economic and social development and the continuous dialogue with all players in the communities and areas in which the business operates. In line with this commitment, the Company has a Social Supply Chain Policy, which facilitates the involvement of social businesses in the supply chain and promotes their inclusion as subcontractors, through reward mechanisms in the evaluation of offerings.

Through the Sustainable Development Policy and the Policy for the management of philanthropic activities and social initiatives, Snam also pledges to promote initiatives in the areas in which the Company operates to promote local development.

The initiatives in the area integrate the comparison with institutions and other stakeholders that takes place in the context of authorisation procedures and environmental impact assessment and, for some plants, also socio-economic. Relations with local areas are reported in detail in the paragraph “Stakeholders and relationship capital – Relations with local areas” of the Integrated Management Report.

These activities are also supported by the work of the Snam Foundation⁵⁵. The Foundation is involved in innovative “corporate citizenship” practices to promote civil, cultural and economic development in priority areas of public interest, encouraging partnerships and making design skills and expertise available. One example is the three-year collaboration launched with the Cariplo Foundation aimed at development urban regeneration projects and combating poverty.

Over time Snam has established an extensive network of relations with local associations, Confindustria Energia and the authorities, with which it handles issues of energy, economic and environmental policy. Locally and nationally, the Company collaborates with regulatory bodies and takes part in associations and committees making its know-how and expertise on social innovation and sustainable development available to them⁵⁶.

Performance indicators

In 2019, the gross Global Added Value produced by Snam was €2,695 million, an increase of €163 million or 6.4% compared with 2018 (€2,532 million).

The percentages distributed to the major reference stakeholders (lenders, shareholders, employees, public administration, local communities) are in line with those in 2018. The most significant change relates to the gross global added value reinvested by Snam within the Group, which rose by 3.7 percentage points compared with 2018. For more information, please refer to the paragraph “Stakeholder and relationship capital” in “Other operating information and results” of the Integrated Management Report.