We are committed to responsible and transparent reporting and have been recognised for the quality of our work in this area: in 2014 and 2015, we were nominated by the Investor Relations Society in the Best Annual Report category among FTSE 250 companies, and in 2015 we were shortlisted for Best Audit and Risk disclosure in the FTSE 250 at the Institute of Chartered Secretaries and Administrators (CSA) Excellence in Governance Awards.
In 2016, our 2015 Annual Report was highly commended in the PwC Building Trust in Corporate Reporting Awards for ‘excellence in reporting’ in the FTSE 250. We apply global standards to ensure our reporting is of the highest quality. We use the Global Reporting Initiative (GRI)* Sustainability Reporting Standards at a ‘Core’ level. We follow the content principles of materiality, stakeholder inclusiveness, sustainability context and completeness; and its quality principles of balance, comparability, accuracy, timeliness, clarity and reliability.
We received a series of questions from the Financial Reporting Council (FRC) in response to the ClientEarth complaint in late 2016 alleging we had failed to adequately disclose climate change risks to our investors, along with routine questions in other areas. We responded in full to all FRC questions in January 2017.
In terms of transparency on climate change risk, in 2015 we judged the risk to Cairn business as ”medium”, based on exposures across the portfolio. This included consideration of the absence of production, the fully funded nature of non-operated developments, and the economic and social benefits to our countries of operation, such as Senegal, in combination with the status of external developments on climate change. We also acknowledged the rising importance of climate change to our stakeholders as “significant” and rising given the outcome of COP21. Our position was ground-truthed with a cohort of stakeholders, as reported in 2015, and the overall assessment of climate change in terms of CR materiality was rated as “medium” based on our assessment criteria. Consequently, we believe that at the close of 2015, the potential impact of climate change on the Company was fairly considered and appropriately represented in our 2015 Annual Report.
We normally report on climate change in the Working responsibly section of our Annual Report and on our website. This year is no exception and assessment of risk and CR materiality in 2016 is reported in the section on Climate change, emissions and discharges.
*GRI is an international independent organisation that helps businesses, governments and other organisations understand and communicate the impact of business on critical sustainability issues, such as climate change, human rights, corruption and many others.