Sustainability indicators

This Report contains the indicators covered in accordance with the ‘Sustainability Reporting Guidelines’ of the Global Reporting Initiative (GRI). All documents cited herein are available at www.saipem.com. The document below has been arranged into sections, each of which discusses a specific topic in detail. The references to the GRI Guideline in question are indicated beside the title of each section.

Economic indicators

Economic performance (EC1, 3-4)

(€ million)2011 2012 2013 
Employee payroll and benefits 1,750  2,041  2,320 
Research and development costs 12  15  14 
Dividend distribution 319  330  375 
Operating expenses 9,388  9,832  9,775 
Net sales from operations 12,593  13,369  12,011 
Income taxes 392  393  106 
Seniority bonus schemes 3.867  5.456 (*)  5.871 

(*) On June 16, 2011 the merger by incorporation of the subsidiary Saipem Energy Services SpA was approved. The accounting and tax effects started at January 1, 2012.

Saipem Group companies implement and manage the supplementary pension plans based on the legal and social system of the state in which the Company operates. Despite the fact that laws in some countries such as the United States and the United Kingdom do not require that the employer pay into employee pension funds, Saipem has decided to support the employee’s supplementary pension plan with its own contribution.

Risk Management (EC2)

On the basis of the ‘Principles of Integrated Risk Management’ approved by the Board of Directors in July 2013, Saipem developed and implemented a model for the integrated management of Company risks. This is now an integral part of the Risk and Internal Control Management System. The new model underscores the Company’s commitment to a more organic and concise vision of the risks to which it is exposed, greater consistency of methodologies and tools to support risk management, and strengthening of awareness at all levels to the effect that an appropriate assessment and management of risks of various types can have a positive impact on the achievement of objectives and on the Company’s value.

In compliance with the Integrated Risk Management process, and following completion of the first cycle of risk assessment which analysed a four-year time frame, on December 23, 2013 the CEO submitted details of the main risks Saipem faces to the Board of Directors.

Although climate change has not been identified as a significant risk in the short term, it may nevertheless affect Saipem’s activities in the long term in those countries characterised by extreme and unpredictable weather conditions which in turn may affect operating costs and the integrity of corporate assets, in addition to the risks involved for employees.

Furthermore, Saipem operates in a variety of countries, and its activities are subject to prior authorisation and/or to the acquisition of permits which require compliance with local HSE legislation. They are further subject to national laws that implement protocols and international conventions on climate change. These can impose restrictions on emissions into the atmosphere, the water and the soil and may provide for the application of very stringent operating standards that have an impact on the overall costs of the project.

Conversely, since climate change has become an issue of international importance, it can also represent an opportunity for business, particularly in the development of new technologies based on efficiency, low environmental impact and the promotion of renewable energy. A business sector within Saipem named ‘Renewables and Environment’ deals with the development and construction of facilities and services for renewables. Saipem is also working on research projects for the development of Carbon Capture & Storage (CCS).

More detailed information on the internal controls and risk management system can be found in the Corporate Governance and Shareholding Structure Report and in the Directors’ Report 2013.

Market presence (EC6-7)

Policy, practices, and proportion of spending on locally-based vendors at significant locations of operations.

  201120122013
Project-based orders placed with local vendors (%)  56 52 51
Local employees (No.)  33,688 37,285 40,379
 (%) 76 77 77
Local managers (%)  46 42 43

One of the pillars of Saipem’s sustainability strategy is to maximise Local Content, which involves both local procurement and local personnel. Saipem helps create growth opportunities for people and businesses in the communities in which it operates.

In 2013, out of a total of €9,066,450,601 of orders, excluding €1,598,637,932 for investments in corporate assets and staff expenses, €3,818,735,211 were ordered from local suppliers. An order is only considered local when the supplier is from the same State as the project for which the order is made. The number of local staff amounted to 40,379 (77.42%) in 2013 compared to 37,285 (76.94%) in 2012, and the percentage of local managers grew by 1%. Further details on initiatives implemented in 2013 are available in ‘Saipem Sustainability 2013’, in the chapter dedicated to Human Resources in the Annual Report 2013, and in the ‘Sustainability’ section of the Company website.

Indirect Economic Impacts (EC8-9)

(€ million)201120122013
Expenses for initiatives targeting local communities 1.898 2.126 2.066

In 2013, Saipem worked through its operating companies to strengthen relations with local stakeholders, both through direct involvement as well as through studies and analyses designed to provide an understanding of the needs of local areas, and to enable planning of interventions. The focus on training (at a cost of €713,000), socio-economic development and promotion of Local Content (at a cost of €757,000) was thus reaffirmed.

Saipem has adopted a tool for assessing the positive effects of externalities generated on local areas by its strategy of maximising Local Content. Known as ‘Saipem Externalities Local Content Evaluation’ (SELCE), the model takes into account the indirect positive effects on the supply chain and the induced effects generated on society. In 2013, the model was updated for Angola and Nigeria to take current operating activities into account. It was also expanded in Indonesia and implemented in Saudi Arabia, and the results of this have been presented to and discussed with several key local stakeholders. Further information and details on the initiatives implemented in the local communities and the SELCE model are available in the document ‘Saipem Sustainability 2013’.

Environment

Raw Materials (EN1)

As a contractor operating in the Oil&Gas industry, the use Saipem makes of the main raw materials in its operating contexts is dictated by the contract conditions set out by the Client (when the materials are not supplied directly by the Client itself, even as semi-finished products). Therefore, from both an economic and environmentally responsible perspective, raw materials fall under the scope of work.

In order to ensure the identification and evaluation of the environmental aspects of offices, since January 2013 the collection of environmental data has also included the paper consumed.

The results will be taken into account by Saipem in order to set goals for each site that has provided this information. In 2013, a total of 212.83 tonnes of paper were purchased. The data was monitored in Paris, San Donato Milanese, Fano, the Saipem SpA Office and Welding Workshop of the Croatian Branch at Rijeka, two office buildings in Rome, Vibo Valentia, the Arbatax Yard and the office of Saipem Contracting Algérie SpA. In 2014, the number of monitored sites will increase with the addition of offices in the UK, Indonesia, the United Arab Emirates and India.

It should be noted that Saipem SA rolled out an initiative to reduce waste from office printing, drafting a ‘Copying and Printing Charter’ available in both English and French. This was sent to all employees of Saipem SA to increase their awareness of waste minimisation. Saipem SA also uses a specific software called ‘Watchdoc’ to monitor the consumption of paper, by paper and print type, for each printer. With this information as its basis, a report was drawn up to show the costs sustained and the savings achieved.

Energy and Emissions (EN3-6, 16, 18, 20)

  201120122013
Direct energy consumption        
Natural Gas  (ktep)  1.2 1.4 0.95
Heavy Fuel Oil (HFO)  (ktep)  6.0 3.2 -
Intermediate Fuel Oil (IFO)  (ktep)  21.9 8.6 28.27
Light Fuel Oil (LFO)  (ktep)  7.0 24.3 32.354
Diesel  (ktep)  320.4 386 368.16
Diesel Marine Oil  (ktep)  102.6 129.1 158.79
Gasoline  (ktep)  5.8 5.6 6.05
Indirect energy consumption        
Electricity consumed (GWh)  242.8 155.9 121.24
Renewable energy        
Electricity produced from renewable sources (MWh)  297.3 271.7 266.31 (*) 
Total direct and indirect greenhouse gas emissions      
Direct GHG emissions (kt CO2 eq)  1320.9 1542.6 1538.7
Indirect GHG emissions (scope 2) (kt CO2 eq)  120.1 69.7 54.0
Other significant emissions        
SO2 emissions (kt)  4.0 4.2 4.4
NOx emissions (kt)  22.4 26.2 25.8
CO emissions (kt)  9.0 10.7 11.1
PM emissions (kt)  - 0.7 0.7
NMVOC emissions (kt)  - 1.0 1.0

(*) This energy is produced by photovoltaics in Italy and Portugal. A photovoltaic system, consisting of 100 modules and occupying a total area of 165 m2, was installed on the roof of the offices of Madeira in 2013. April 2013 saw the first production of energy by this method, which is fed into the grid and not used in the Saipem office. It is important to note that the production levels of this type of energy are  strongly influenced by weather conditions.

Gasoline consumption in 2013 increased by 8%, mainly due to the consumption levels of the ‘Etihad Railway’ project, which, on account of the specificities of the activities, requires several cars to be travelling constantly along the railway line. The long voyages of some vessels (including the Normand Cutter, from Brazil to China) explain why Marine Diesel Oil consumption increased by 23%. In addition, the Scarabeo 8 and 9, the two new offshore drilling rigs, started activities at full capacity and this also influenced the increase. It should be noted that Heavy Fuel Oil (HFO) was not used in 2013, since the characteristics of certain geographical areas meant that some offshore vessels used other types of fuel. In the year of reporting, the Saipem 7000, the vessel which in 2012 was the largest user of HFO, was deployed in the North Sea and, therefore, has only used Light Fuel Oil (LFO), in accordance with local regulations. Consumption of electricity was down in the three-year period 2011-2013 from 242.8 to 121.24 GWh. The main explanation for this is the conclusion of the Qafco V project, which had required considerable quantities of energy.

Saipem has developed a number of initiatives with the aim of increasing energy efficiency. The strategy consists of analysing the assets and, subsequently, implementing technical solutions together with training and awareness-raising initiatives.

As regards activities on the vessels, Saipem is continuing its plan to create an SEEMP (Ship Energy Efficiency Management Plan), a tool for managing the environmental performance of the Company’s fleet (excluding drilling rigs), by 2015. This plan, provided by the International Convention for the Prevention of Pollution from Ships (MARPOL - annex VI), is specific to each vessel. To date, the SEEMP has been implemented on 17 vessels. The main actions proposed include the use of more energy-efficient lighting, maximisation of the efficiency of air conditioning, the adoption of higher capacity engines (which should lead to the use of a smaller number of engines), and improvements in voyage planning. The goal for 2014 is to reduce fuel consumption by 3-4% for these assets.

2013 also saw the continuation of the voyage optimisation initiative, which began in 2012. Route optimisation consists of identifying the optimal route for the voyage, through satellite evaluation performed with specially designed software, in order to reduce navigation time and, consequently, fuel consumption. The best route is detected each day, taking into consideration the weather conditions and currents. During 2013, the software was applied to Castorone, FDS, FDS 2, Castoro Sei and Castoro Otto. Total savings amounted to 233 tonnes of fuel, with a total of 732 tonnes of CO2 also saved.

Moreover, for the purposes of increasing the energy efficiency of vessels, an energy assessment of the Saipem 7000 was conducted in 2013. The measures proposed are the installation of economisers to recover heat from the flue gases of the 12 diesel generators, voyage optimisation, the use of electric heaters for preheating the engine (instead of heating through the steam), the use of software to optimise the energy consumption of PCs, the use of additives in fuels and, finally, replacement of transformers. The main energy consumption reduction initiatives for offices are as follows:

  1. energy assessments of 3 office buildings in Italy were carried out in 2013 in order to identify critical areas and propose corrective actions. These fall into two different categories, the first relating to the insulation of buildings and the second covering the introduction of technological systems. At present, management is in the process of evaluating different initiatives proposed downstream of the energy assessment;
  2. temperature regulation in the offices: programmable timers were installed in the Saipem Croatian Branch offices beginning July 2013 to adjust the air conditioning and heating. Compared to 2012, the monthly saving is about 8,500 kWh;
  3. Green PC: 2013 has seen the continuation of the initiative to reduce power consumption when computers are not in use. To date, the ‘PowerMan’ software has been installed on around 7,000 PCs, enabling a saving of about 300 MWh.

Saipem is very committed to increasing the energy efficiency of its offices, because:

  • in most cases, the Company has operational control of these assets;
  • total energy consumption in offices is significant, representing 2.6% of toe consumed by the Company and, more specifically, 53% of the electricity supplied by the national grid and about 98% of the natural gas used altogether.

As regards the search for innovative solutions, Saipem has been studying a number of techniques to increase the energy efficiency of its facilities. At the moment, the Company is focusing on the reduction of energy waste, improving the efficiency of air cooling equipment in particular.

More details on these issues can be found in the chapter ‘Minimising environmental impacts’ of ‘Saipem Sustainability 2013’.

Water (EN8, 10)

  2011 2012 2013 
Total water withdrawal by source        
Total withdrawal of water. of which: (103 m3) 7,234.8  8,245.1  8,740.1 
- fresh water/from waterworks (103 m3) 2,570.8  4,056.8  5,683.4 
- groundwater (103 m3) 3,938.8  3,251.8  1,997.8 
- surface water (103 m3) 86.6  221.3  218.4 
- sea water (103 m3) 638.5  715.1  840.43 
Recycled and reused water        
Reused and/or recycled water (103 m3) 303.9 1,024.8 1,788.2
(%) 4 12 20

In 2013, water consumption reached 8,740.1 103 m3 compared to 8,245.1 103 m3 in 2012. Moreover, the percentage of reused water increased to 20% compared to 12% the previous year. There are two reasons for this:

  • consumption levels on the Castorone, the Scarabeo 8 and the Scarabeo 9, which were fully operative in 2013;
  • the requirements of the ‘Shah Plant Project’, which is one of the largest ever carried out by Saipem, and which had a significant impact on overall environmental performance (in 2013, the project totalled about 60 million hours worked compared to 40 million in 2012). Saipem promotes the implementation of initiatives to achieve water savings both at project level and on operational sites. Initiatives to encourage reuse of treated waste water are considered particularly important.

In an effort to identify areas at high water risk, Saipem carries out a two-step assessment. In the first, once all operational sites have been identified, Saipem uses the Global Water Tool, Aqueduct and Maplecroft instruments to assess the water risk. The second step involves assessing the water withdrawal, use, discharge and the systems present. In this way, the critical areas in which improvement projects will be implemented are identified.

Downstream of the water risk assessment, Saipem will carry out a case study in 2014 on the management of the Company’s water resources in which greater detail will be sought on the most affected water sources and the measures needed to reduce these impacts.

Biodiversity (EN11-12, 14)

Saipem considers biodiversity to be a significant issue and monitors its own potential effects within its Environment Management System implemented in all operating contexts. Management of potential effects and related mitigation measures is therefore practiced at the level of individual projects and operating conditions.

As a contractor, Saipem works on projects and in areas for which the Client normally provides an Environmental Impact Assessment. If this is not the case, or when conditions so require, Saipem carries out the environmental impact studies itself. These include systematic evaluation of the effects on biodiversity in the areas in which the Company operates, in order to evaluate and implement compensatory solutions with a view to maintaining the original environment. In the case of its own property, which consists mainly of manufacturing yards, Saipem is equipped with a system for monitoring the impacts of its activities, including any possible effects on the biodiversity of the surrounding areas. In this regard, a Corporate Standard Procedure will be drafted in 2014 to govern the biodiversity and define activities and responsibilities in relation to it.

The chapter ‘Minimising environmental impacts’ of ‘Saipem Sustainability 2013’ describes the process of identifying and managing any type of environmental impact and provides a concrete example with the ‘Shah-Habshan-Ruwais’ project for the construction of a railroad in the UAE.

Discharges (EN21)

(103 m) 2011 2012 2013 
Total water discharge      
Total waste water produced. of which: 1,642.0  3,696.3  5,319.4 
- water discharged into the sewer systems - 400.4  616.1 
- water discharged into bodies of surface water - 572.8  1,543.7 
- water discharged into the sea - 480.3  750.7 
- water discharged to other destinations - 2,242.6  2,408.9 

The increase in the total amount of water discharged has a twofold explanation: (i) the operational needs of the ‘Shah Plan Project’ and (ii) greater accuracy in the environmental reporting system.

Waste (EN22, 24)

(kt) 2011 2012 2013 
Total weight of waste by type and disposal method      
Total waste produced. of which: 199.9  257.9  387.4 
- hazardous waste disposed of in landfill sites 22.3  31.9  50.9 
- incinerated hazardous waste 4.3  5.3  3.4 
- recycled hazardous waste 4.3  13.9  7.8 
- non-hazardous waste disposed of in landfill sites 134.6  171.5  282.8 
- incinerated non-hazardous waste 11.2  4.0  6.0 
- recycled non-hazardous waste 23.2  31.3  36.5 

The Shah project has significantly influenced the production of non-hazardous waste.

It is important to note that hazardous waste is mainly disposed of locally through a third party company, with the exception of some waste incinerated onboard some of the main vessels. Saipem has implemented a number of initiatives at site level for the optimisation of waste management. One of these is the project to improve the division of waste and recovery of waste water, implemented in Saudi Arabia at the Dhahran base.

Spills (EN23)

  2011 2012 2013 
Number of spills        
Total (n.)  94  144  77 
Spills of chemical substances (n.)  - 19  21 
Spills of oily substances into fresh water (n.)  - 125  56 
Volume of spills        
Total (m3 656.45  5.4  67.2 
Spills of chemical substances (m3 - 1.6  62.7 
Spills of oily substances (m3 - 3.8  4.5 

Saipem has changed its methodology for monitoring spills by separating the reporting of ‘near misses’ and spills under 10 litres from other spills for better analysis and classification of the incidents. These types of incident are, however, included in the environmental reporting system for optimal management of incidents.

In 2013 there were 7 spills larger than one m3, including a 35.5 m3 spill that happened on the Saipem 10000 drillship. Due to the emergency situation, the Master ordered a disconnection from the well and activated the Emergency Shut Down (ESD) procedure as well as the Emergency Quick Disconnect (EQD) for the Lower Marine Riser Package (LMRP). The consequence of the emergency disconnection of the LMRP was the leakage into the sea of 35.5 m3 of oil based mud contained in the marine riser. Bad weather and a strong current contributed to the accident.

All incidents are reported and investigated appropriately in order to establish the causes and identify corrective actions to prevent such events from happening in the future. Each quarter, environmental bulletins and reports are disseminated throughout the Group in order to share the ‘lessons learned’.

Impacts, costs and investments (EN27-30)

As a contractor in the Oil&Gas industry, from the contractual point of view it is not possible for Saipem to account for the products and services provided, as these are defined and managed by the Client. However, Saipem implements all measures necessary to ensure the protection of the environment when carrying out its work, both in activities managed directly by its own personnel and vessels, and in all operations subject to operational control. Saipem considers it of extreme importance to manage properly the significant environmental aspects and impacts that derive from these. Indeed, Saipem has long adopted a certified Environmental Management System according to the international standard ISO 14001, a tool for monitoring the environmental impacts of its activities, but also for systematically striving for continuous improvement.

In 2013, Saipem did not receive any significant fine and/or monetary sanction for non-compliance with environmental laws and regulations. As a contractor, Saipem accounts for expenses and investments solely in relation to its own activities and assets, and not for those related to commissioned projects, which form part of the overall project costs and are reimbursed by the Client.

(€ million) 2011 2012 2013 
HSE investments 19.4  35.4  36.97 
Expenses for integrated HSE management 31.7  39.7  38.55 
Expenses for the environment 2.7  6.7  7.1 

Working conditions and practices

Employment (LA1-3, 15)

(number)2011 2012 2013 
Total employees at year end, of which: 44,232  48,455  52,157 
- Senior Managers 441  436  431 
- Manager  4,696  4,857  4,954 
- White Collar  20,382  22,148  22,849 
- Blue Collar  18,713  21,014  23,923 
Employees in countries outside Europe 33,822  37,322  41,793 
Female employees 5,068  5,331  5,701 
Employees with a stable work contract 17,679  18,025  18,662 
Employees with full-time open-ended contracts - 48,227  51,903 
Termination of employment of key resources 2,918  3,541  4,581 

In 2013 there was further growth in the workforce due to the needs of some onshore E&C projects, particularly with regard to activities carried out in Mexico and Canada.

There was an increase of 370 female employees (7%) and 3,332 male employees (8%). As regards employees who play what is considered a key professional role, these now account for 36% of the workforce, an increase of 3% compared to 2012.

Saipem provides its employees with different benefits and methods of allocating these, in accordance with local conditions. These include: complementary pension plans, supplementary healthcare funds, mobility support services and policy, welfare initiatives and family support policies, catering (lunch tickets) and training courses aimed at ensuring more effective integration within the social-cultural context in question. The benefits, where applicable, have been offered to the entirety of the specific target population to date, regardless of contract type (temporary/permanent), except for those specific services that may be incompatible in terms of the timing of the service with the duration of the contract itself.

Further details relating to employment are provided in the chapter ‘Competency as a business driver’ of the document ‘Saipem Sustainability 2013’.

Industrial Relations (LA4-5)

  2011 2012 2013 
Employees covered by collective bargaining (%) 55 48 50
Strikes (hours) - - 61,477

The industrial relations model adopted has the primary objective of ensuring a fair and transparent Company/union relationship based on compliance with international conventions and the transnational agreements to which Saipem adheres. It also ensures optimal management of relations with the employers’ associations of the sector, institutions and public bodies. Whenever a major organisational change is expected, it is the practice of the Saipem Group to communicate the development to the trade union representative. In Italy, due to a specific provision for collective bargaining, meetings with the unions are regularly convened to enable illustration of/exposure to the change in place.

Out of the 43,418 employees monitored, 21,628 are covered by collective bargaining agreements. It is important to bear in mind that Saipem operates in countries where there are no provisions for these types of agreement. In cases of divergence between local and international standards, the Company seeks solutions that facilitate behaviour based on international standards whilst considering the local principles. In 2013, there were 61,477 hours of strikes of which 43,200 were in Algeria. In view of the impending conclusion of drilling operations in Algeria, in 2013 a detailed meeting was held with the union to define methods for handling redundancies. In May, a strike involving 243 employees lasted a total of 16 days. However, negotiations led to an agreement with the union covering the drilling sector.

More information is available in the Human Resources section of the management report of the ‘Annual Report 2013’ and in the chapter ‘Competency as a business driver’ of ‘Saipem Sustainability 2013’.

Health and Safety (LA6-9)

In Saipem, the culture of health and safety of workers is guaranteed and backed by a strong internal campaign. This, in turn, is facilitated by the external regulatory environment, mainly characterised by laws and agreements at national and Company level, and by the internal environment characterised by specific policies on health and safety that define particularly stringent criteria when compared to the local contexts, which today are characterised by the presence of a regulatory system still in the process of development.

Not all countries in which Saipem operates have trade unions at both national and local level. Where specific agreements are in place, they can be broken down into three main lines pursued by the Company and shared with the trade unions:

  • setting up workers H&S committees (composition and number);
  • specific training for safety officers (responsible Company figures and employee representatives) and grassroots information on safety matters to all employees, with particular reference to courses on Health and Safety at Work, Fire Fighting, First Aid, and mandatory ‘Special Operations’ (Onshore- Offshore);
  • regular meetings between the Company and workers’ representatives.

In Italy, health, safety and environment are regulated by specific contract clauses and by the national labour contract. Specifically, the latter requires the appointment of worker representatives for the protection of the health, safety and environment of workers. This is done by election and the number of representatives is set by law and by the national labour contract. Furthermore, for some years now, Saipem has, in part, linked the provision of supplementary premiums to its safety objective indicators (for example the Safety Frequency Rate) as well as with profitability and productivity indicators.

Saipem launched the LiHS (Leadership in Health and Safety) programme in 2007 with a view to promoting the health and safety of its employees. This programme consists of several stages which, through workshops directed at all levels of the Company, aim to spark a cultural shift in the personnel so that they are more attentive to and aware of health and safety issues.

 201120122013
LiHS Programme      
Phase 1      
LiHS trained facilitators 12  24  19 
Workshops performed 105  130  113 
Number of participants in workshop phase 1 1,421  1,643  1,405 
Phase 2      
Number of cascading events 80  126  87 
Number of cascading participants 4,882  4,459  2,962 
Phase 3      
“Five Stars train the trainer” 14 
Number of Five Stars training courses 197  252  121 
Number of Five Stars participants 2,064  2,373  1,329 
Phase 4      
Number of Leading Behaviours Cascading events 757  265  86 
Number of Leading Behaviours Cascading participants 26,928  9,639  4,291 

Safety in the workplace

  2011 2012 2013 
Man-hours worked (million hours) 329,54  321,99  298,05 
Fatal accidents  (No.) 
Lost Time Injuries  (No.)  96  99  71 
Days lost  (No.)  4.447  5.625  3.611 
Total Recordable Incidents  (No.)  427  342  344 
Rate of absenteeism (%)  - - 2,2 
LTI Frequency Rate  (ratio)  0,31  0,32  0,26 
TRI Frequency Rate  (ratio)  1,30  1,06  1,15 
Tool Box Talks  (No.)  585.957  781.401  925.017 
Safety hazard observation cards  (No.)  519.768  575.611  701.329 
HSE meeting  (No.)  41.757  45.287  45.376 
Job Safety Analysis  (No.)  334.598  390.721  239.475 
HSE inspection  (No.)  189.702  258.875  301.820 

The reporting perimeter corresponds to that (not necessarily geographical) of the work area in which Saipem is responsible for defining HSE standards and for ensuring and monitoring their application.

The calculation methodology used for the main indicators is outlined as follows:

  • the man-hours worked are the total number of hours worked by employees of the Company and contractors working on the operating sites;
  • lost days of work translate into the total number of calendar days in which the injured person was not able to do their job as a result of an LTI. The calculation of days lost starts from the second day after the accident and counts up to the day on which the person is able to return to work;
  • the LTIFR and TRIFR values are calculated on the basis of 1,000,000 hours worked, in compliance with the standards applied internationally in the industry, and include injuries involving both employees and contractor staff;
  • the rate of absenteeism is calculated as the ratio between the total hours of absence and the theoretical total annual hours to be worked. The total hours of absence do not include parental leave and estimated holiday hours.

More details on the safety performance can be found in the chapter ‘A safe workplace and a healthy workforce to ensure excellence’ in ‘Saipem Sustainability 2013’.

Health

(No,) 2011 2012 2013 
Vaccines administered to employees and subcontractors 12,387  9,124  7,607 
Medical staff 529  558  545 
Medical consultations 75,464  85,361  90,923 
Medical fitness examinations 34,737  36,518  42,519 
Occupational illnesses reported 10 
Cases of repatriation of employees and subcontractors 143  170  159 
Sites where the H-Factor programme has been implemented 24  37 

Saipem considers the health and well-being of its employees to be of unquestionable value. It is constantly working to strengthen its Health Management System. The Company organises a number of health promotion initiatives for its employees, such as:

  • initiatives for the prevention of circulatory diseases;
  • initiatives and programmes for the promotion of a healthy lifestyle such as the H-Factor and Choose Life. The first has been implemented with the cooperation of Saipem’s catering companies and with the support of the Company’s medical service. The second is a programme consisting of a two-hour workshop, in which the short film ‘Choose Life’ is shown with the aim of boosting the health culture;
  • Saipem operates in a number of countries considered at risk of Malaria. ‘Malaria Awareness Lectures’ are therefore organised for employees. At year end 2013, 99.96% (5,312) of non immune employees operating in those zones had taken the course.

More details and information on these initiatives are available in the chapters ‘A safe workplace and a healthy workforce to ensure excellence’ and ‘Partnering with local communities’ of the document ‘Saipem Sustainability 2013’.

Training (LA10)

(hours)2011 2012 2013 
Training      
Total hours of training, of which: 1,809,753  2,624,610  2,592,093 
HSE  1,236,260  2,026,677  1,746,201 
Managerial behaviour and skills  70,582  72,931  77,017 
IT and languages  103,910  95,680  120,841 
Technical professional skills  312,271  336,971  604,633 
Other professional skills  86,730  92,351  43,401 

It should be noted that the 1,746,201 HSE training hours include 1,508,601 hours for foreign projects targeted at both Saipem and employees and subcontractors.

People development (LA11-12)

  2011 2012 2013
Skills assessment        
Skills assessment, of which: (hour)  761  2.605  3.118 
- management skills (hour)  54  22 
- evaluation of potential (hour)  186  118  257 
- technical skills (hour)  91  2.184  2.640 
- evaluation of potential for experts (hour)  479  249  199 
Performance assessment        
Evaluation of the performance to which employees are subject, of which: (No.)  17.220  23.498  22.411 
- Senior Manager  (No.)  - 436  406 
- Manager  (No.)  - 2.965  1.905 
- White Collar  (No.)  - 10.774  10.945 
- Blue Collar  (No.)  - 9.323  9.155 

Saipem bases its business success on a strong technical capacity in both its equipment and its employees. Continuous training and skills development are key elements in the management and development of people. Saipem manages its skills assessment by basing it on a specific road map for each role within the Company in terms of objectives, responsibilities and skills, both technical and personal. In particular, professional skills are monitored and measured using a specific evaluation process, with a timeline connected to specific needs. The activity currently requires that, based on the role of the person, the manager in question carries out an evaluation of the employee’s technical skills in relation to the level of seniority, which is then accompanied by an assessment of their personal skills. During this activity, shortfalls can emerge between the level of skills and knowledge required by a specific role and that possessed by the person. If this is the case, the employee is offered the opportunity to undergo specific training, on the job, in the classroom, or in practice in order to expand their professional skills. Training therefore acts as a process over the entire professional life cycle of the person, ensuring coverage of the role they currently occupy and roles they will occupy in the future based on staff development plans designed to cover the needs of the project and the Company’s structure in terms of quality and quantity.

More information on the training and development of people can be found in the chapter ‘Competency as a business driver’ in ‘Saipem Sustainability 2013’.

Diversity and Equal Opportunities (LA13-14)

Gender diversity

  2011 2012 2013 
Female presence        
Female employment (No.)  4,911  5,331  5,701 
Female Senior Managers (No.)  - 16  19 
Female Managers (No.)  - 606  653 
Compensation         
Ratio of basic salary of women to men, by employee category:        
- Senior Manager  (%)  - 79  89 
- Manager  (%)  91  90  91 
- White Collar  (%)  92  89  92 
- Blue Collar  (%)  92  128  116 

Age diversity

(No.) 2011 2012 2013 
Age groups      
Employees under 30 years of age - 9,140  9,820 
of which women: - 1,399  1,405 
Employees aged between 30 and 50 - 31,230  33,524 
of which women: - 3,341  3,628 
Employees over 50 years of age - 8,085  8,813 
of which women: - 591  668 

Cultural diversity

(No.) 2011 2012 2013 
Multiculturalism      
Number of nationalities represented in the employee population 119  124  126 

The protection of specific groups of employees is safeguarded through the application of local laws, and is reinforced by specific corporate policies that emphasise the importance of this issue. The goal is to ensure equal opportunities for all types of worker in an effort to deter the onset of prejudice, harassment and discrimination of any kind, whilst safeguarding dignity, sexual orientation, colour, race, nationality, ethnicity, culture, religion, age and disability in full respect of human rights. In the various environments in which Saipem operates, this protection is reflected in the context of specific regulations that provide for minimum employment obligations of disabled staff, young staff or in relation to certain proportions between local and expatriate staff, for example.

With regard to gender diversity, there was a slight increase in the percentage of women in managerial positions (12.47% of the total in 2013 compared to 11.75% in 2012).

In terms of salary, the indicator has been calculated as the ratio between the average salary of a woman compared to the average salary of a man by category. The categories of foreign employees were identified using the ‘Job Evaluation System’ logic. Analysis of the average salary per country and per category shows that 78% of countries have made efforts to align wages or at least to reduce the gap between men and women in the last two years.

Saipem promotes the work/family balance of its personnel through regulations and/or local policies that guarantee parental leave. In all environments, maternity/paternity leave is regulated and only differs in timing and type of abstention from work. This is accompanied by possibilities of leave for breastfeeding, child or family member illness, and raising a child (flexible and part-time working hours). The possibility of adoption-related leave is also worth a mention. In 2013, about 800 employees of the Saipem Group had taken a total of around 41,000 days of parental leave.

Human rights

Investment and Procurement Practices (HR1-2,5-7)

Saipem is committed to operating within the law and in compliance with regulations, statutory provisions, codes of conduct and codes of ethics. All vendors involved in procurement activities with Saipem must read and accept Model 231 in full, including the Saipem Code of Ethics which draws its inspiration from the Universal Declaration of Human Rights of the United Nations, the Fundamental Principles of the International Labour Organisation (ILO) and OECD guidelines for multinational companies. This model is included as a document in all standard contracts with Saipem. In the qualification phase, the vendor fills out the Vendor Declaration in which it makes a commitment to act in strict accordance with the principles defined in the Saipem Code of Ethics and to respect human rights in accordance with Saipem’s Sustainability Policy. It also undertakes to fulfil the requirements in accordance with the national law in force on salary, social security contributions and insurance obligations in relation to its staff.

In addition, in 2011 Saipem integrated its own process for evaluating vendors with the aim of assessing the social responsibility of its supply chain. The current vendor qualification system has been supplemented with requirements for complying with social and labour rights, in line with the ‘Fundamental Principles and Rights at Work’ of the International Labour Organisation (ILO) and SA8000 standard. To achieve this, there is a particular focus on child and forced labour, freedom of association and the right to collective bargaining, remuneration, working hours, discrimination and disciplinary procedures, and health and safety. In 2013, audits were carried out on 22 new vendors in China, India, Brazil and Italy. The qualification questionnaires of 317 vendors were also analysed in detail. The questionnaires were selected according to the class of goods and nations with potential risk, with further details and additional documentation being requested where necessary. 16 vendors were identified as requiring a specific audit.

(No.)201120122013
Vendor audits on workers’ rights 17 19 24

Beginning 2013 follow-up audits were also carried out on several suppliers previously analysed. In the reporting year, 2 of the 24 audits carried out were of this type.

More details can be found in the chapter ‘Local Content approach: delivering shared value’ of ‘Saipem Sustainability 2013’ and in the Code of Ethics.

Reports (HR4)

Saipem has a corporate standard that describes the process of managing reports.

The term ‘report’ refers to any information regarding possible violations, behaviour and practices that do not conform to the provisions in the Code of Ethics and/or which may cause damage or injury to Saipem SpA (even if only to its image) or any of its subsidiaries, on the part of Saipem SpA employees, directors, officers, audit companies and its subsidiaries and third parties in a business relationship with these companies, in one or more of the following areas: the internal control system, accounting, internal accounting controls, auditing, fraud, administrative responsibilities under Legislative Decree No. 231/2001, and others (such as violations of the Code of Ethics, mobbing, theft, security, and so on).

Saipem has prepared various channels of communication in order to facilitate the sending of reports, including, but not necessarily limited to, regular post, fax numbers, voice mail and e-mail, and communication tools on the intranet/internet sites of Saipem SpA and its subsidiaries.

All reports are subject to the prior scrutiny of the Internal Audit function in order to reach a preliminary determination on whether there are any legal and practical implications of the report, and to decide whether or not to proceed with the investigation. In the circumstances so require, an audit is carried out by the Internal Audit function, taking priority over any audits performed under the annual programme. These audits are done as quickly as possible and the results are assessed by the Internal Audit function, in coordination with the Human Resources, Organisation and ICT department, the Legal function and, for issues concerning accounting, internal accounting controls, auditing and fraud, with the cooperation of the Chief Financial Officer. Top management of the entity being audited defines, in cooperation with the above functions, the contents of the ‘Action Plan’ required for the removal of any risks identified. For each finding there must also be a deadline defined for corrective actions and an indication of the organisational position and name of the person responsible for the implementation of the corrective action.

Two different reports, one quarterly and one half-yearly, are drawn up and submitted to the Chairman, the Board of Auditors, the Internal Audit Committee, the Independent Auditors, Eni’s Internal Audit function, the Chief Financial Officer (for issues regarding accounting, internal accounting controls, auditing and fraud) and the Compliance Committee (for matters concerning administrative liability under legislative decree).

(No.) 201120122013
Number of files      
Of which: 28 38 58
- unfounded 3 10 5
- infondati  25 25 16
- pending - 3 37

Details of some categories of file are provided below:

(No.) 201120122013
Files on cases of discrimination      
Of which: 3 4 4
- founded or partially founded - - -
- unfounded - - 1
- pending - - 3
Files in relation to workers’ rights      
Of which: 2 10 (*) 17
- founded or partially founded 1 1 1
- unfounded - 7 6
- pending - 2 10

(*) The figure is varied compared to 2012, because beginning 2013 the data is reported in cases/files and not in reports as per the previous year. Indeed, a case/file includes various reports.

During the course of 2013, 17 files were opened relating to workers’ rights. Of these, 10 are still open while the remaining 7 have been closed. Six reports were deemed unfounded and 1 founded. For the report deemed founded, concerning stalking behaviour against a Saipem employee, corrective actions have been implemented to protect the staff member. In addition, with reference to a report closed as unfounded concerning bullying behaviour, corrective actions have nevertheless been implemented with a view to creating a respectful and collaborative working environment.

Finally, 3 of the 5 reports that were still open in 2012 (out of a total of 10 files) were closed in 2013. All 3 were unfounded and did not result in corrective actions. In 2013, 4 files were opened in relation to reports of discrimination, of which 3 remain active, while one has been closed. With reference to the latter case, the report was set to the Compliance Committee of the company concerned. On the basis of its investigation, and having deemed that there was no evidence of any violation of the Code of Ethics with reference to the facts contained in the report, the Compliance Committee closed the file. No corrective actions were implemented. It should be noted, moreover, that the only report file still open in the 2012 reporting period with discriminatory behaviour as its subject matter was closed in 2013. The report was deemed unfounded. However, improvement measures were implemented, including the adoption of a programme of cultural induction for all expatriates and the construction of facilities for local workers.

Security (HR8, 10)

In the management of security, Saipem gives utmost importance to respecting human rights. To underscore this, in 2010 Saipem introduced clauses concerning respect for human rights into its contracts with the external security company. Any non-compliance is due grounds for cancellation of the contract. Any personnel working overseas are normally given pre-departure training. In 2013, special training was launched for the promotion of human rights involving 15 security managers and the HR managers. In 2014, this training is expected to be extended to staff in different operating environments.

For all new operational projects in which Saipem is responsible for security, a Security Risk Assessment on the country in question is made prior to any offers being tendered. If a decision is made to proceed with the offer, a Security Project Execution Plan is also prepared. The security risk related to the operating activities and context is analysed, including any issues of human rights violations. On the basis of the risks identified, the actions needed both to manage and reduce these to a minimum are decided upon.

  2011 2012 2013 
Contracts with Security suppliers with human rights clauses (%) 33 72 84
Security Risk Analysis in the commercial phase (*) (No.) 21 58 48

(*) Figures for the years 2011 and 2012 differ from 2013. This is because a new reporting system has been introduced and is still being implemented. Data for 2011 and 2012 are, therefore, underestimated.

More information can be found in the chapter ‘Competency as a business driver’ of ‘Saipem Sustainability 2013’.

Society

Local Communities (SO1)

Saipem is present in many regions, working with a decentralised structure in order to respond better to local needs and sustainability aspects. Wherever it works, Saipem plays an active role in the community, providing a contribution to the social and economic life of the area including, but not solely, in terms of local employment and the creation of value. Saipem has always strived to establish an open and transparent dialogue with all stakeholders.

Depending on Client requirements and instructions, Saipem makes use of the socio-economic impact assessments and studies supplied by the Clients themselves or produced in-house, where necessary, in its operational project management. The operations in which Saipem has direct responsibility for the impacts generated at a local level relate to the manufacturing yards or logistic bases that it owns. In these cases, Saipem identifies and assesses the potential effects of its activities and actions in order to ensure they are managed appropriately, as well as any specific activities and projects aimed at developing the local socio-economic context. The typical tool used is the Socio-Economic Impact Assessment (SIA) or the ESIA (Environmental Social Impact Assessment). As a result of such studies, Saipem collaborates with the stakeholders involved to prepare an Action Plan in order to define the interventions required to manage the impacts generated on the local communities. For example, PT Saipem Indonesia Karimun Branch, which operates on the island of Karimun (Indonesia), updates the analysis on the impact of Saipem’s activities on the local communities on an annual basis.

Business ethics and the prevention of bribery and corruption (SO3-4)

The Group is a party to legal proceedings still underway. Further details can be found in the section ‘Legal proceedings’ of the ‘Annual Report’.

In order to reduce the risk of exposure to sources of corruption, Saipem has issued further anti-corruption regulatory instruments relating to various topics and particularly sensitive areas. These internal procedures are subject to constant checks to ensure they are updated when and where necessary. The most significant of these include the Management System Guidelines (MSG) ‘Anti-corruption’, and ‘Legal’ and the standard procedures ‘Joint Venture agreements’, ‘Intermediary Contracts’, ‘Standard contractual clauses concerning administrative liability of the company deriving from criminal offences’, ‘Expenses for hospitality’, ‘Authorisation and control of sales or acquisitions of participations, companies or lines of business’, ‘Charity/Donations and Sponsorship’ and ‘Procurement of Consulting and Professional Services’.

Saipem’s anti-corruption procedures and Model 231 provide for corrective measures and disciplinary sanctions in the event of the violation of laws, regulations or procedures in this regard. Furthermore, specific contract clauses provide for the termination of contracts in force whenever trade partners, brokers or subcontractors violate anti-corruption laws or internal procedures. On the basis of any violations, and the manner in which they were committed, the corrective measures deemed necessary and most appropriate are taken.

Saipem organises training courses, both via e-learning and workshops, on themes such as anti-corruption, the Saipem Code of Ethics, Model 231 and other issues to raise awareness among employees in an effort to prevent cases of non-compliance with the law.

It is worth mentioning that the number of training hours has been calculated by counting the average number of hours per type of course.

(No.) 2011 2012 2013 
Employees trained on issues of compliance, governance, ethics and anti-corruption 999 1,050 1,370
Hours of training carried out on issues of compliance, governance, ethics and anti-corruption 8,400 16,800 7,957

Further details on measures to prevent corruption are available in the chapter ‘Developing long-term competitiveness’ of the document ‘Saipem Sustainability 2013’ and in the ‘Corporate Governance and Shareholding Structure Report 2013’.

Transparency and other information (SO6-8)

Compliance with the law, regulations, statutory provisions and codes of conduct, and the practice of ethical integrity and fairness, are a constant commitment and duty of all Saipem People. Indeed, they characterise the conduct of Saipem’s entire organisation.

Saipem’s business and corporate activities must be carried out in a transparent, honest and fair manner, in good faith, and in full compliance with competition protection rules.

Saipem does not make contributions, either direct or indirect, in any form, to political parties, movements, committees and political organisations and unions, their representatives and candidates, except those provided for by specific regulations. In 2013, the Company did not receive any legal notices for anti-competitive behaviour, anti-trust, and monopoly practices and their outcomes. On July 11, 2013, the Court of Milan ordered Saipem SpA (as the legal entity incorporating Snamprogetti SpA) to pay a fine of €600,000 and further ordered the confiscation of the deposit of €24.5 million in relation to the charge of international corruption in Nigeria. It should be noted that this sentence is not final and is subject to appeal and that in any case the fines have no financial impact on Saipem since, at the time of the sale of Snamprogetti SpA to Saipem, Eni undertook to indemnify Saipem for losses sustained in connection with the legal proceedings.

Product Responsibility

Product Responsibility [PR1-2 and 3-4, 6-9 (non-material)]

As a contractor, Saipem operates at all times in accordance with the Client’s requests and in compliance with international regulations. Contractual responsibility for the product remains with the Client.

Saipem supplies products that do not require labelling, and in each case reference to the technical and quality standards are the contractual conditions imposed by the Client. Therefore, the Client is responsible for the product, Saipem only for its manufacture.

Saipem promotes the protection of health and safety of all personnel engaged in its operational activities and of the host communities. The Company has implemented management procedures and processes specific to the particularly complex systems, where the highest risks are operational and safety-related (see the document ‘Saipem Sustainability 2013’).

Customer Satisfaction (PR5)

Analysing and quantifying the perception of the Client and how Saipem’s work is perceived is a fundamental factor in the approach for continuous improvement. Saipem believes that constant monitoring of Client satisfaction is vital to achieving the best results.

The Client satisfaction process is based on a questionnaire administered via the internet that asks for Client feedback on many topics, both managerial and technical, from engineering to procurement and construction. Specific sections are devoted to project management, quality, HSE and sustainability. These sections are designed to evaluate Saipem’s capacity in its relations with the local community and the promotion of Local Content.

In 2013, Saipem received 71 questionnaires from Clients of onshore and offshore drilling projects. The main results are as follows:

  201120122013
Customer Satisfaction questionnaires received (No.)  96 84 71
Average Client satisfaction score (on a scale of 1 to 10)   7.87 8.09 7.75
Average Client satisfaction score on issues of Sustainability (on a score ranging from 1 to 10)   7.72 7.74 7.52

Saipem has a Client satisfaction evaluation system in place. More information can be found in the chapter ‘Developing long-term competitiveness’ in ‘Saipem Sustainability 2013’.