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Sustainability Report/Sustainability Report/Principles and strategy/Values, principles, standards and code of conduct

Values, principles, standards and code of conduct

Our values

GRI 102-16, GRI 102-17, GRI 102-19, GRI 102-20, GRI 102-26, GRI 102-32, GRI 102-33, GRI 206-1, GRI 307-1

50Hertz defines sustainably successful corporate activities as those it performs in the interest of society. This is expressed in Elia Group’s mission statement - “For a successful energy transition in a sustainable world” - and through 50Hertz’s initiative, “100 percent by 2032: new energy for a strong economy”, which was revised in 2020. 50Hertz has tasked itself with driving the energy transition forward and, more specifically, to meeting 100% of the demand for electricity across its grid area with a stable supply of renewable energy by 2032.

Elia Group’s three pillars of growth outline how 50Hertz efficiently provides the infrastructure society needs, delivers additional societal value and supports the growing role played by its customers. The occasionally conflicting targets and interests of our different stakeholders need to be aligned with our own targets and interests. We interact with our stakeholders by approaching them with the greatest possible degree of transparency about our activities and plans.

Our commitment to corporate social responsibility is expressed in our sustainability mission statement and the Elia Group Code of Ethics. These outline our intention to comply with the ten principles of the UN Global Compact with regard to human rights, workers’ rights, environmental protection and corruption. Our employees are also provided with an extensive company handbook which contains all applicable guidelines, directives, process manuals and work agreements, each of which can be found on our Intranet. Our company handbook was revised, updated, clarified and made more accessible in 2020. The code of ethics and the company policies specify what is considered to be acceptable professional conduct and make it clear that all employees should respect the law. These principles feed into organisational measures that are binding for all employees across 50Hertz. During 2021, no significant legal fines connected to general business activities, line construction projects or grid operation were imposed on 50Hertz. Note that the reporting threshold was set at €25,000 (fines below this threshold related to administrative offences).

Under the supervision of the Executive Committee, an action roadmap was also defined to continuously improve the sustainability performance of our company and to continuously expand sustainability reporting.

Sustainability organisation

GRI 102-18, GRI 102-19, GRI 102-20

The responsibilities and governance of sustainability-related issues are clearly fixed.

The importance of continuously developing the management and reporting of sustainability-related issues is illustrated by our embedding of these into our annual business plans, which each span a period of five years. As part of our group wide sustainability strategy, targets, indicators and measures are developed, reviewed and embedded into the corporate strategy of 50Hertz. A company-wide Sustainability Board which includes C-level executives and heads of department steers this process and reports to the Chief Executive Officer and HR Officer. The Sustainability Board meets three times a year to agree on targets and processes. 

The implementation of individual measures and the setting of key performance indicators is the responsibility of each company department. The CSR core team (consisting of responsible staff from the involved departments) meets quarterly to discuss these. Employees who are responsible for data collection and management make key performance indicators available to the entire company via a central transparency management platform. As part of our risk analysis process, which involves quarterly updates and the organisation of our annual risk-related conference, sustainability-related risks are discussed and assessed with management. Furthermore, certified management systems are used in key CSR areas (such as ISO 45001 for health and safety at work, and ISO 14001 for environmental management) and internal management systems based on acknowledged standards, for instance for early public participation (VDI 7000) are in place.

Legal framework

50Hertz’s activities are carried out in line with German and European legislation and regulations. In the reporting year, the laws outlined below were of particular relevance to our business activities. These laws have a big impact on our activities, since they are related to the integration of renewable energy and, therefore, sustainability.

The amendment to the Climate Protection Act increased the greenhouse gas reduction target from 55% to at least 65% by 2030 and 88% by 2040. The target year for reaching climate neutrality was brought forward from 2050 to 2045. Concrete measures aimed at achieving this target are due to be set through individual laws and ordinances. These will also have a significant influence on 50Hertz’s business activities.

The Supply Chain Due Diligence Act describes requirements regarding the due diligence obligations of companies in Germany. The aim of the Act is to improve the protection of human rights in global supply chains, which run from a company’s own business operations through to its direct and indirect suppliers. Important components of the law include businesses being required to carry out risk analyses, implement risk management measures and introduce complaints mechanisms and transparent reporting. From 2024 onwards, the law will apply to companies with more than 1,000 employees.

Legal framework

50Hertz’s activities are carried out in line with current legislation. Our business activities are subject to numerous national and European regulations. The following important laws and European ordinances and directives provide the framework for our business activities:

• the Energy Industry Act (EnWG)
• the Renewable Energy Sources Act (EEG)
• the Grid Fee Modernisation Act (NEMog)
• the Heat and Power Cogeneration Act (KWKG)
• the Federal Immission Control Act (BImSchG)
• the Federal Nature Conservation Act (BNatSchG)
• the Act on the Digitalisation of the Energy Transition
• the European Energy Efficiency Directive
• the EU Habitats Directive and
• the EU Birds Directive.

The Group-wide Code of Ethics, our Human Rights Policy, and binding internal anti-corruption policies define what 50Hertz considers to be correct ethical conduct, and clarify that the company complies with the law and does not tolerate corruption. These principles feed into organisational measures that are binding for all employees across the company.

50Hertz guidelines that regulate a whistleblowing system and stipulate the establishment of an internal Compliance Committee and an external ombudsperson have been in place since 2010. The Compliance Committee consists of one member of staff from the Legal Department and one from the Human Resources Department, as well as the Compliance Coordinator. Once a year, the ombudsperson submits a written report to the Compliance Committee which outlines the claims they have received in the preceding 12 months. When the ombudsperson receives a justified complaint about 50Hertz, the Compliance Committee is called in to deal with the case and take further action where necessary. The Committee reports to senior management once per year at minimum (they may report to senior management on a more regular basis to if  the circumstances call for this). In addition, an electronic alert mechanism has been put in place in 2023 covering further areas, such as potential cases of discrimination and human rights abuses. 

In 2023, our ombudsperson received no complaints related to corruption. During the business year, no significant fines connected to line construction projects or line operation were imposed on 50Hertz. Note that the reporting threshold was set at €25,000 (fines below this threshold related to administrative offences).

Political influence

GRI 102-16, GRI 415-1

Since policymakers have a strong impact on 50Hertz’s business activities, the company publishes position papers which are made available to politicians in a transparent manner. The Communication, Public Affairs & Reputation Management Department is responsible for this. In the run-up to the 2021 federal elections, for example, a position paper entitled "Taking the right actions more quickly" was published, which provides an overview of the energy policy areas which urgently need to be addressed from the point of view of a transmission system operator. As part of a series of roundtables organised with the Mining, Chemical and Energy Industrial Union (IG BCE), 50Hertz held a number of discussions with stakeholders from the world of politics, business and science in 2021 about ensuring the success of the phase-out of fossil fuels and climate-neutral management. The results of these discussions are summarised in the paper entitled “With new energy for strong industrial jobs”. Further information about the paper can be found in the Stakeholder engagement section. In addition, 50Hertz launched the initiative “Together. Faster. Climate-neutral.” in 2021 and, along with other grid operators, energy and industrial companies, we developed concrete proposals for policymakers and published them in December 2021. These are aimed at accelerating the expansion of electricity grids, so that they will be able to transport the electricity generated by renewable energy sources.

The company’s interactions with political representatives are conducted in a responsible and transparent manner; 50Hertz does not make any donations to political parties. Ethical standards relating to the representation of political interests have been established; these form the basis of our interactions with political stakeholders. A detailed orientation guide, which applies to the whole company and has been approved by senior management, explicitly regulates staff conduct in political environments. It states that 50Hertz does not make any donations to politicians or political parties and maintains a fair and impartial balance when sponsoring organisations or initiatives. The responsibility for donations to party-affiliated foundations and associations is centrally coordinated by the 50Hertz Communication, Public Affairs & Reputation Management Department. Through specific training programmes, 50Hertz ensures that employees who take part in advocacy activities related to social and energy matters align their communication and actions with clearly defined principles. Beyond that, 50Hertz is listed on the EU Transparency Register and is committed to its Code of Conduct. The Lobby Register Act, which was passed on 25 March 2021 and came into force on 1 January 2022, aims to help strengthen public trust in politics and the legitimacy of decision-making processes undertaken in Parliament and by the Government. Its ultimate aim, therefore, is to create more transparency with regard to the influence of representatives throughout these processes. As soon as entries can officially be added to the German Lobbying Register, 50Hertz will add its information to it.

In 2021, 50Hertz did not make any donations to politicians or political parties.

Prevention of Corruption

GRI 205-2, GRI 205-3

Our Corruption Prevention Guideline outlines 50Hertz’s guidance and expectations relating to correct ethical conduct and states that corruption is not tolerated. The whistleblowing guideline describes the anonymous reporting channel that employees can use to make complaints to an external ombudsperson. In addition to in-person training about compliance issues being offered to specific staff, a web-based compliance training course was made available to staff across 50Hertz in March 2021, which was completed by almost 90% of staff. The next round of regular training is scheduled for spring 2023. Since governance, risk and compliance matters are being closely integrated, internal control systems (ICS) are also being developed and linked to risk management. Thus, as regular risk assessments are undertaken, so control mechanisms are updated accordingly.

During the reporting period, no cases of corruption were reported.

Risk management

GRI 102-30, GRI 102-11

50Hertz’s systematic approach to risk management includes the regular recording and evaluation of the following risk categories:

•             protection of life and limb;

•             profit and loss;

•             liquidity;

•             reputation;

•             security of supply.

It is 50Hertz’s goal to avoid risks related to our existing operations, to reduce risk factors as much as reasonably possible and to optimise our risk profile. Our Risk Guideline defines how risks are determined, recorded, assessed and monitored on a quarterly basis. Once a year, we also hold a risk-related conference, during which each head of department (as risk owners), the risk manager and 50Hertz management discuss the most significant risks and risk-related issues. At project management level, an integrated process was introduced for the planning of timing, budget and risk management. In the context of sustainability, risks related to environmental, social and governance (ESG) domains exist; for example, these relate to risks in the areas of occupational safety, environmental damage and data security and transparency. At Elia Group level, the management of ESG risks has been developed, in turn influencing 50Hertz’s risk management. For instance, in 2021, a risk assessment exercise relating to physical and climate-related impacts was undertaken at Group level; the results were integrated into the risk management processes of Germany and Belgium.

Security

GRI industry information on disaster/emergency planning and disaster management measures

As an operator of critical infrastructure, 50Hertz is obliged by the IT Security Act and the Energy Industry Act (EnWG) to ensure that information is securely stored on systems that are necessary for maintaining security of supply. The processing, storage and communication of information must therefore be designed in such a way that the availability, confidentiality and integrity of the information and our critical systems are ensured to an appropriate degree.

Our information security management system was recertified in 2020 in accordance with ISO 27001 (“IT Security Catalogue pursuant to Section 11 (1a) EnWG”). Through an established security process, information security risks are systematically identified and dealt with. In the reporting year, no targeted cyberattacks were carried out against 50Hertz; moreover, no damage caused by information security incidents occurred. In an independent audit which evaluated and certified the operational security of data centres (based on DIN EN 56000), 50Hertz’s data centres were designated as “highly available” at Level 3.

As part of our data protection management system (DSMS), the existing e-learning programme relating to data protection was updated in XX and internal employees and subcontractors were subsequently trained in this area.

For 50Hertz, security does not stop at the company’s boundaries. For example, staff are trained in crisis management and crisis communication with internal and external stakeholders during regular crisis team exercises. Existing structures, processes and reporting channels are continuously reviewed and improved, and crisis team members and employees are trained in the skills needed to deal with unexpected and high-stress events; they are also trained to take quick and appropriate crisis management decisions. These and other measures serve to increase the resilience of 50Hertz. In addition to training being offered to all members of the crisis team, reviews are undertaken of property protection concepts and general corporate security is further developed.

50Hertz regularly rehearses so-called ‘black start’ events in order to be prepared to restore power supply within a short space of time in the event of a blackout. Such events must be regularly rehearsed with relevant partners as part of simulations and during grid restoration tests using real conditions. This ensures safety in the event of a crisis and is also required by law.

In the year under review, the grid was successfully restored for the second time using a so-called ‘start-up grid’. A start-up grid consists of an isolated grid with strategically useful transformer stations which are simultaneously electrified by a black start unit (in this case, a pumped storage power plant).

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