consolidated non-financial statement...materiality analysis and contents definition 72 company...

consolidated non-financialstatement

in accordance with Italian Legislative Decree No. 254 of December 30, 2016

Extract of the Directors’ Reportof the Annual Report 2018

ExtractDNF18.qxd 17-04-2019 10:13 Pagina I

consolidated Non-financial Statement

Reporting methodologies, principles and criteria 71Reporting boundary 71Materiality analysis and contents definition 72

Company management and organisation model 74Saipem SpA Organisation, Management and Control Model - ‘Model 231’ (which includes the Code of Ethics) 74Corporate Governance 75Stakeholder relations 75

Protecting the environment and minimising environmental impacts 76Environmental management system and policies 76

Environmental management and results 78Spill prevention and response 78Energy efficiency and GHG emissions 79Water resource management 80Waste management 81

Social aspects 82Social policies and management 82

Social aspect management activities and results 84Relations with the local context 84Local presence 84Management of an ethical supply chain 84

Saipem people 86People policies and management 86Risks associated with human resource management 87People management and results 87Skills and knowledge development 88Industrial relations 91Diversity and equal opportunities 91Innovation in people management 93Health 94Safety 95Asset integrity 98

Fighting corruption 98Human rights 99

Security practices 100Reporting suspected violations 101

Limited assurance 103

GRI content index 104

ExtractDNF18.qxd 17-04-2019 11:38 Pagina II

SAIPEM Annual Report 2018 / Consolidated Non-Financial Statement

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Reporting methodologies,principles and criteriaThis document is the ‘ConsolidatedNon-Financial Statement’ (hereinafter NFS) ofthe Saipem Group as at December 31, 2018,in accordance with Italian Legislative DecreeNo. 254/2016 and subsequent amendmentsand additions.This report has been prepared in accordancewith the GRI Standards: Core option (see the‘GRI Content Index’ section). The Core optionrequires that all the 33 disclosures in theOrganisational profile, Strategy, Ethics andintegrity, Governance, Stakeholderengagement and Reporting practice areas areincluded and that all the requirementscontained in the ‘Management Approach’ GRIstandard 103 and all reporting requirementsfor at least one indicator foreseen by therelevant ‘topic-specific’ standard are met.The NFS refers to the ‘Director’s Report’ andthe ‘Corporate Governance and ShareholdingStructure Report’ with regard to the contenttreated in detail in the above-mentioneddocuments and in turn it contains informationthat fulfils the obligations referred to in thefirst and second subparagraphs of Article2428 of the Italian Civil Code, limited to theanalysis of non-financial information.In addition to the provisions outlined bylegislation, the content of the document hasbeen defined, as established by the provisionsof the GRI Standards, taking intoconsideration the principles of materiality,stakeholder inclusiveness, sustainabilitycontext, transparency and completeness.The principles of balance, comparability,accuracy, timeliness, clarity and reliability havebeen followed to guarantee the quality of theinformation contained in the document.The performance indicators, selected on thebasis of the issues identified as material forSaipem (see the ‘Materiality analysis andcontent definition’ section), have been collectedon an annual basis. The information andquantitative data collection process has beenorganised in such a way as to guaranteecomparability of the data and analysis of thetrends in the three-year period, in order toenable correct interpretation of the informationand a full overview for all the stakeholdersinterested in the evolution of Saipem’sperformance. Any changes in the collectionmethods are suitably indicated in the document.During 2018, Saipem has developed an

internal control system over non-financialinformation to further strengthen the reliabilityof the overall non-financial reporting system.Saipem has defined a series of securitymeasures in addition to those already in place,that will have effects on the security of the dataand information managed by the company forthe purposes, albeit non-exclusive, of thisdocument. These also apply to the reportingsystems used so that all technologicalinfrastructures and software are fully integratedin the security systems to protect them againstcyber attacks. These measures, under currentor future implementation, specifically concernsupply chain management and employeehealth management systems.

Reporting boundary

The NFS contains the information andperformance indicators for Saipem SpA andthe fully consolidated subsidiaries in the‘Annual Report’, as prescribed by ItalianLegislative Decree No. 254/2016. Anychanges in the reporting boundary from theprevious year are described in the ‘Principlesof consolidation’ section of the ‘Annual Report’.In some contexts there are deviations on theconsolidation boundary previously defined, inany case guaranteeing the criterion ofsignificant impact. As of this year, safety datawere reported separately for Saipem andsubcontractors. Indicators concerningenvironmental impacts also includes the datafor subcontractors operating on Saipem andpartner sites in activities where Saipem isresponsible for HSE management.Furthermore, the significance limits for theinclusion of operating sites in the boundary(No. of people on site or, in the case of officesnot belonging to Saipem, the type of leasecontract) are also defined for these indicators.Companies that do not have significantactivities are excluded from the description onrelations with local stakeholders.In order to guarantee the significant impactcriterion set forth by Legislative Decree No.254/2016, meaning the provision ofinformation required to ensure thecomprehension of all Saipem Group activities,its performance, its results and impactsgenerated, and to guarantee the comparabilityof the performance with the informationpublished in other corporate documents, inaddition to the integrated boundary (called the‘Group consolidated’), indicators are also

CONSOLIDATED NON-FINANCIALSTATEMENTIn accordance with Italian Legislative Decree No. 254 of December 30, 2016

The ‘Consolidated Non-Financial Statement’, which is the reporting document on the management of non-financialaspects describing Group policies, the main activities, results and impact generated in the year in terms of indicators and trend analysis.

ExtractDNF18.qxd 17-04-2019 10:13 Pagina 71


72

reported with a more extended reportingboundary, including non-consolidatedcompanies and joint operations, joint venturesor associates, over which Saipem controlsoperations1. These indicators are marked bythe wording ‘Group total’ boundary. For somematerial issues, the impact of Saipem’sactivities is manifested beyond the boundary ofthe organisation. As foreseen by the principleof information completeness defined by GRIStandard 101: Foundation, the organisation isrequired to report the boundary for each

material aspect including both impacts directlycaused by its activities and impacts to which itcontributes and that are directly associatedthrough business relations to its activities,products and services. For this purpose andconcerning the most significant issues,Saipem reports some significant indicatorsand information also referred to activities itdoes not directly manage. The following tableidentifies the external boundary by category ofstakeholders concerned, also indicating anylimitations that impact each material issue.

Material issues External boundary LimitationsPeople safety Vendors and subcontractors Partial, for vendorsSafe operations, asset integrity and process safety Vendors and subcontractors Partial, for vendorsAnti-corruption and ethical business practices Business partners, vendors and subcontractors -Human and labour rights - -Technology, operational innovation and research - -Training and development Subcontractors (HSE training) -Spill prevention and response Vendors and subcontractors VendorsEthical supply chain Vendors and subcontractors Partial, for vendorsHealth and well-being Some local communities -Energy efficiency Vendors and subcontractors VendorsPrevent climate changes and GHG emissions Vendors and subcontractors VendorsSecurity practices Security service providers -Talent attraction and retention - -

Identification ofsignificant themes bysector concerningSaipem businesssustainability

Analysis of significantthemes for Saipemstakeholders

Analysis of prioritythemes for corporatemanagement

Material themeselection for theCompany

• Analysis of thesustainability contextof Saipem’s business,sustainability ratingagencies, means ofcommunication andcustomer andcompetitorbenchmarks to mapsignificantsustainability themesby reference industry

• Survey of all (morethan 4,400 individualswho responded to thesurvey) corporatestakeholder categoryrepresentatives(clients, businesspartners, businessassociations, investors,insurance companies,NGOs, representativesof local communities,authorityrepresentatives,vendors and Saipememployees)

• Consulting, via survey,of Saipem seniormanagement

• Identification of the 13most significantthemes for theCompany andstakeholders, on whichthe non-financial andsustainabilitystatements are basedand which theCompany takes intoaccount to define itsfuture objectives

(1) The ‘Group total’ boundary includes the following companies for environmental, health and safety aspects (including HSE training): SAGIO - CompanhiaAngolana de Gestão de Instalaçao Offshore Ltda, Petromar Lda, Saipem Taqa Al Rushaid Fabricators Co Ltd and S.C. TCPI Romania - TecnoprojectoInternacional Srl is only included for health and safety aspects but not for environmental aspects. The boundary concerning personnel and human rightswas extended to include the following companies: Petromar Lda, Saipem Taqa Al Rushaid Fabricators Co Ltd, Charville - Consultores e Serviços Lda,SaiPar Drilling Co BV, TSGI Mühendislik Insaat Ltd Sirketi, ASG Scarl, CEPAV (Consorzio Eni per l’Alta Velocità) Due, KWANDA Suporte Logistico Lda.Regarding the aspects related to anti-corruption, the extension of the boundary concerns the following companies: TSGI Mühendislik Insaat Ltd Sirketi.

Materiality analysis and contents definition

The NFS reports those aspects foreseen byLegislative Decree No. 254/2016 concerningthe fight against active and passivecorruption, the environment, personnelmanagement, social aspects andprotection of human rights assessed assignificant and material according to aprocess that takes Saipem’s specific activitiesand the interest of all corporate stakeholdercategories into account, as described below.As provided for by the GRI Standards and in

line with Saipem procedures, the companyimplements a materiality analysis processevery year. This is aimed at identifying thesustainability aspects of its business thatcould substantially influence the assessmentsand decisions of its stakeholders and areconsidered significant for the Company itself.The analysis is carried out with theinvolvement of representatives from allmain stakeholder categories and from thecorporate management.Following is a representation of the processfor subsequent work phases.



73

The respondents (external stakeholders,Saipem employees and senior management)identified the most important issues, assessingthem in accordance with the responsibilityprinciple (issues that the respondent considersmust be managed by Saipem as a responsiblecompany) and the value created (economic,social, cultural, reputational, environmental, etc.)for Saipem itself, in favour of its stakeholders,and for civil society in the broadest sense.The final materiality analysis results werevalidated by the Sustainability Committee,

that is chaired by the CEO and made up ofcorporate top management, shared with theSustainability, Scenarios and GovernanceBoard Committee and with the Board ofDirectors.The issues that emerged from the materialityanalysis become the basis for the definition ofthe Saipem Sustainability Plan,across-the-board for all business lines, that islater taken into consideration for the definitionof the four-year strategic plan and specificmanagerial targets.

Topics required byItalian LegislativeDecree No. 254/2016Company managementand organisation modelArticle 3.1, subsection a

PoliciesArticle 3.1, subsection b

Environmental topics:- environmental impacts

Article 3.2, subsection c- energy and emissions

Article 3.2, subsection a;Article 3.2, subsection b

- water resources Article3.2, subsection a

Personnel managementArticle 3.2, subsection dHealth and safetyimpacts Article 3.2,subsection c

Social aspects Article3.2, subsection d

Respect for humanrights Article 3.2,subsection e

Fighting corruptionArticle 3.2, subsection f

Saipem material topics

Energy efficiency.Prevent climate changes andGHG emissions.Spill prevention and response.Technological and operatinginnovation.

People safety.Health and well-being.Training and development.Attract and retain talent.Safe operations, assetintegrity and process safety.

Security practices. Ethical supply chainmanagement.

Human and labour rights.

Anti-corruption and ethicalbusiness practices.

GRI Standard

GRI 102: GeneralDisclosures 2016

GRI 302: Energy 2016GRI 305: Emissions 2016GRI 306: Effluents andWaste 2016

GRI 202: Market presence2016GRI 401: Employment 2016GRI 403: OccupationalHealth and Safety 2018GRI 404: Training andEducation 2016GRI 405: Diversity and equalopportunity 2016

GRI 410: Security Practices2016GRI 414: Supplier SocialAssessment 2016

GRI 406: Non-discrimination2016GRI 407: Freedom ofAssociation and CollectiveBargaining 2016GRI 408: Child Labour 2016GRI 409: Forced OrCompulsory Labour 2016

GRI 205: Anti-corruption2016

Saipem 2018NFS sections

Companymanagement andorganisation model.

In the specific‘Managementpolicies and system’sections of eachissue discussed.

Energy efficiencyand GHG emissions.Spill prevention andresponse.

Safety, Health,Skill and knowledgedevelopment.

Ethical supply chainmanagement.Security practices.

Saipem people andall subsections.Respect for humanrights.

Fighting corruption.

Detailed in otherdocuments

• Directors’ Report‘Human resources,quality’ and‘Governance’ chapters.

• CorporateGovernance andShareholdingStructure Report2018.

Corporate policies areavailable in theDocumentation sectionon websitewww.saipem.com.

Sustainable Saipem2018 ‘On the side ofprogress againstClimate Change’ and‘Guaranteeing safeoperations’ sections.

Sustainable Saipem2018 ‘Guaranteeingsafe operations’ and‘Valuing People’ sections.

Sustainable Saipem2018 ‘Perform as aresponsible player’section.



LEGISLATIVE DECREE no. 254/MATERIAL TOPIC/GRI/NFS CONTENT CORRESPONDENCE



74

A description of the risks identified for the fiveareas of Legislative Decree No. 254/2016 andtopics defined as material for the Company, inaddition to that indicated in the specific NFS

sections, is included in the ‘Risk management’section of the ‘Directors’ Report’, for a fulldescription integrated into the overall SaipemEnterprise Risk Management system.

Material topics/Risks DESCRIBED IN THE ‘RISK MANAGEMENT’ SECTION OF THE ‘DIRECTORS’ REPORT’

Cl imat e change prevent ion and GHG emissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Ener gy efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Peopl e safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Safe operat ions, asset int egrit y and process safet y . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Spil l prevent ion and response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Technol ogy, operat ional innovat ion and research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Ant i-corrupt ion and et hical business pract ices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Human and l abour r ight s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Securit y pract ices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Et hical suppl y chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Training and devel opment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Tal ent attract ion and retent ion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Heal t h and wel l -being . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Company managementand organisation modelThe consolidation process of the divisionalorganisation model, adopted by Saipem inMay 2017, continued in 2018 focusing on anincreased divisional autonomy in thecontinuous pursuit of maximum businessflexibility, improved performance andcorporate governance processes andconstant adherence to compliance andgovernance principals.The ‘towards a new organisational structure’was launched in the second half of 2018 topursue the full autonomy of the Divisionsthrough a redefinition of the Saipem systemof powers and proxies and the update of theDivision executive powers, operating modelsand work processes to avoid the directinvolvement of the CEO while strengtheningthe steering and control role.The following main organisational changeshave taken place during the year:- allocation of the Strategies and M&A

departments to directly report to the CEOto support the definition of strategicscenarios and M&A initiatives;

- reorganisation of the Offshore E&C Division,with a strengthening of the role ofcoordination on the worldwide network andidentification of a supervisory boarddedicated to Offshore E&C Italy operationsmanagement;

- redefinition of the Onshore E&C Division to

improve Project organisation andstrengthen the sales force;

- fine tuning of the Offshore Drilling, OnshoreDrilling and XSIGHT Divisions to maximisethe efficiency and effectiveness of projectacquisition and execution activities.

Furthermore, the process of aligning theentire Regulatory Framework to the divisionalbusiness model and organisational changesthat occurred during the year continued alongwith the worldwide deployment of theorganisational structure adopted by eachDivision to subsidiaries and branches.

Saipem SpA Organisation, Managementand Control Model - ‘Model 231’ (whichincludes the Code of Ethics)

At the meeting held on March 22, 2004, theSaipem SpA Board of Directors resolved toadopt its own organisational, managementand control model pursuant to ItalianLegislative Decree No. 231 dated 2001(hereinafter, ‘Model 231’), aimed at preventingthe crimes set out by Italian LegislativeDecree No. 231 dated 2001.Subsequently, by means of specific projects,the updates to Model 231 were approved toincorporate the legislative innovations and thechanges in the corporate organisation SaipemSpA.In particular, the subsequent updates toModel 231 took into account:



75

- the changes in the corporate organisationof Saipem SpA;

- the changes in case law and jurisprudence;- the considerations arising from the

implementation of Model 231, includingindications in case law;

- practices of Italian and foreign companieswith regard to the models;

- results of supervision activities and thefindings of internal audit activities;

- the evolution of the legislative frameworkand Confidustria Guidelines.

Finally, also following the removal of themanagement and coordination of Eni SpA asof January 22, 2016, the Chief ExecutiveOfficer-CEO, on July 28, 2016, initiated theprogramme for implementing the innovationsfor a review of the structure of the Model 231and Code of Ethics, which is an integral andsubstantial part of Model 231, and a generalRisk Assessment regarding the crimes set outby Italian Legislative Decree No. 231/2001.The purpose of the activity was to reviewModel 231 and the document ‘Sensitiveactivities and specific control standards forthe Model 231 of Saipem SpA’ renamed (inline with best practices) ‘Special Part of Model231 - Sensitive Activities and Specific ControlStandards’ with the purpose of aligning themwith:- the regulatory updates;- the organisational changes that have taken

place;- trends in case law and legal theory;- best practices.At the end of these updates, on January 15,2018, the Saipem SpA Board of Directorsapproved the Saipem SpA ‘Model 231(including the Code of Ethics)’ and ‘SpecialSection of Model 231 - Sensitive activitiesand specific control standards’.After the various timely updates made overthe years, Model 231 of Saipem SpA was alsoupdated, inter alia, in accordance with thefollowing regulations:- Italian Legislative Decree No. 24 of March 4,

2014, which intervened in the context of thetrafficking of human beings and theprotection of the victims amending Article600 of the Italian Penal Code (reduction toor maintenance in slavery or servitude) andArticle 601 Italian Penal Code (trafficking ofpersons);

- Italian Legislative Decree No. 39 of March 4,2014, which introduced the crime of‘grooming minors’ into the crimes set out inItalian Legislative Decree No. 231/2001;

- Law No. 68 of May 22, 2015, ‘Provisionsrelated to crimes against the environment’(so-called ‘Ecoreati’, ‘Eco-crimes Act’),which introduces new cases ofenvironmental crime;

- Law No. 167 of November 20, 2017,‘Provisions for fulfilling the obligationsarising from Italy being part of the EuropeanUnion - European Law 2017’. The provision

aims to bring domestic regulations in linewith EU regulations, also intervening on theliability of legal entities. In regulating thefight ‘against some forms and expression ofxenophobic racism by means of criminallaw’, the new Article 25-terdecies ‘Racismand xenophobia’ provides for this as a crimewithin Italian Legislative Decree No.231/2001;

- Law No. 179 of November 30, 2017 on‘Provisions for the protection of thosereporting crimes or irregularities that theymay have become aware of in the contextof their public or private employment’.

Corporate Governance

Saipem adopts a system of CorporateGovernance that is based on the general andspecial regulations applicable to the Articlesof Association, the Code of Ethics, therecommendations contained in the CorporateGovernance Code of the Italian StockExchange and best practices on the subject.Saipem’s system of Corporate Governance isbased on the central role of the Board ofDirectors, transparency and theeffectiveness of the internal audit system.It should be noted that the Sustainability,Governance and Scenarios Committee’s isresponsible for reviewing the ‘Non-financialstatement’ set forth by Italian LegislativeDecree No. 254 dated December 30, 2016,and to provide a preliminary assessment tothe Board of Directors to approve thisdocument. For a more detailed description ofthe governance for the aspects required byItalian Legislative Decree No. 254/2016, referto the ‘Corporate Governance andShareholding Structure Report’, in particularthe section ‘Sustainability’ and the sectionsregarding the Board of Directors, internalcommittees and risk management.The above-mentioned document is present inthe ‘Governance’ section of the Company’swebsite.

Stakeholder relations

The Company strives to continuously involveall bearers of legitimate interests in Saipem asa fundamental aspect of its sustainablebusiness. Pursuing a constant dialogue andsharing objectives with all stakeholdersare the means through which it is possible tocreate reciprocal value. The approachdeveloped by Saipem over time is designed toensure open and transparent relations withthe parties involved and promote positive andmutually advantageous interactions.The principles and responsibilities at the basisof Saipem’s stakeholder engagement processare defined in the ‘Stakeholder Engagement’Management System Guideline, a corporate



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governance tool applied to the entire Group,designed to uniquely define the SaipemSustainability Model in line with thecornerstones of the Company’s SustainabilityPolicy.The main issues that have arisen over the yearfrom the stakeholder engagement processconsist of the topics considered material.The priorities among these are: people

safety, anti-corruption and ethical businesspractices, human and labour rights, spillprevention and response, climate change andGHG emission prevention. In order to meetthe stakeholders’ expectations on theseissues in terms of transparency and thedefinition of concrete commitments, Saipemprovides detailed reporting in this statementand the ‘Sustainable Saipem 2018’ document.

APPROach to STAKEHOLDER engagement

FinancialStakehol ders

Continuousdialogue with the

financialcommunity.

Commitment toensuring the

utmosttransparency and

fair access toconfidentialinformation.

Periodicpublication of

informationthrough press

releases andpresentations.

Periodicmeetings with

institutionalinvestors and

financial analysts.

Individualshareholders caninterface directlywith the Company

Secretary.

Cl ients

Constantreporting and

frequentmeetings on

operatingprojects.

Meetingsorganised with

clients andpotential clients

also includesustainability

aspects.

Proactiveengagement inHSE initiatives

such asenvironmental

awarenesscampaigns or

LiHS (Leadershipin Health and

Safety)programmes.

Empl oyees

Commitment torecruiting and

retainingtalented

personnel andpromoting their

development,motivation and

skills.

Guarantee asafe, healthy

workenvironment and

stable relationswith the trade

unions to ensurean open dialogue

based oncooperation.

Localgovernments

and authorities

Customisedengagement with

localgovernments

and authorities.

Institutional andofficial relationswith authorities,

as well ascollaboration

with publicbodies to launch

initiatives infavour of local

developmentprojects.

Localcommunit ies

Contribution toprogress in local

communities interms of socialand economic

development andimprovement in

living conditions.Each operating

company orproject has a

specificapproach that

takes theCompany’s role

and the specificcontext into

account.

Activeinvolvement of

localcommunities in

theimplementation

of localdevelopment

projects.

Localorganisations

and NGOs

Regularpublication of

information,objectives and

results throughSaipem’s

institutionalchannels.

Identification oforganisations

with provenexperience and

integrity withwhich to

establish shortand

medium-termrelations in

order tofacilitate the

implementationof specific

projects.

Vendors

Commitment todeveloping and

maintaininglong-term

relations withvendors. The

process ofvendor

managementmakes it possible

to assess theirreliability from

technical,financial and

organisationalcapabilities.

Proactivecommitment inHSE initiatives

such asenvironmental

awarenesscampaigns or

LiHS (Leadershipin Health and

Safety)programmes.

Businessassociations

Activeparticipation and

support fornumerous

international andlocal

associations,contributing to

sharing ‘bestpractices’ within

Saipem’sbusinesssectors.

Contributions tostrengthening

Saipem’s role inits industries

and its relationswith other

stakeholders (i.e.clients, local

stakeholders,etc.).

Protecting the environmentand minimising environmentalimpacts

Environmental management system and policies

Saipem is aware that all its activities, from theplanning and engineering stages toconstruction and operation, may potentiallyhave an impact on the environment, bothdirectly and along its business value chain.In identifying, assessing and managingenvironmental and social impacts tied tobusiness management, both potential andreal, Saipem is guided by international

regulations, principles, shared approachesand internationally recognisedrecommendations adopted in the industryincluding UN Global Compact principles(especially, principles 7, 8 and 9 that refer tothe environment), the principles expressed inthe International Finance CorporationPerformance Standards on Environmental andSocial Sustainability, Organisation forEconomic Co-operation and Development(OECD) guidelines for multinationals and theEquator Principles.As described in the Saipem SpA HSE Policy,the Company is committed to preventing thepotential impacts caused by its activities andusing energy and other natural resourcesefficiently.



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This is why Saipem takes all necessarymeasures to ensure environmentalprotection when carrying out its works, bothfor activities managed directly by its ownpersonnel and using its own equipment andthose operations over which it has operationalcontrol (customers, subcontractors, etc.) tominimise and correctly manage the significantenvironmental aspects and impacts that mayarise from them. Moreover, Saipem pays theutmost attention to the constantimprovement of its environmentalperformance. In order to ensure these results,Saipem has implemented a ManagementSystem certified in accordance with theISO 14001 international standard.All significant Saipem Group businessdivisions are ISO 14001:2015 certified tosupport and guarantee the environmental

management system adopted by theCompany. Saipem is aware of the real andpotential impacts of its activities and definesspecific actions and tools required to managethese impacts for each operating context.Furthermore, the Company invests inresearch and development programmes tocreate technologies that minimise theenvironmental impact of its operations,and as service to the relevant industry, andorganises specific initiatives designed topromote environmental awareness and thedissemination of best practices, also involvingexternal entities as potential addressees ofthem. Further information can be found in the‘Research and development’ section of the‘Director’s Report’ and the document‘Sustainable Saipem 2018’.

SAIPEM OPERATIONSENVIRONMENTAL ASPECTS

SPILLCONTINGENCIES

ENERGYCONSUMPTION

WATERWITHDRAWAL/

DISCHARGE

AIR AND DUSTEMISSIONS

WASTEPRODUCTION

NOISE AND VIBRATIONS

MAIN OUTPUTS AND POTENTIALIMPACTS ON THE ENVIRONMENT

• Soil, groundwater and waterpollution

• Degradation and loss of naturalhabitats and ecosystems

• Flora/fauna disturbance• Biodiversity depletion• Damage to public safety

• GHG emissions and globalwarming

• Air pollution• Wildlife and flora damages• Loss of natural habitats

• Groundwater pollution• Groundwater use• Degradation and loss of aquatic

habitats and ecosystems• Flora/fauna disturbance• Biodiversity depletion

• Air pollution• Degradation and loss of natural

habitats and ecosystems• Flora/fauna disturbance• Biodiversity depletion

• Soil overuse• Decreased landfill space• Modification of landscape• Damage to public safety• Direct and indirect impacts

connected with impropermanagement

• Human/wildlife disturbance• Degradation and loss of natural

habitats and ecosystems• Biodiversity depletion

POTENTIAL MITIGATION MEASURES

• Spill management hierarchy: prevention;preparedness; response

• Suitable storage areas for oils andchemicals

• Hazardous substances inventory• Spill mapping and Risk Assessment• Spill kit availability• Use of environmentally friendly

substances• Training and drills

• Energy saving and efficiency practices• Use of renewable sources• Energy assessments on critical assets• Periodic maintenance and replacement of

equipment and machines• Use of less pollutant fuels

• Water reuse and saving practices• Efficient treatment plants• Periodic maintenance

• Periodic maintenance and replacement ofequipment and machines

• Dust control programmes• Pollutant abatement systems• Use of less pollutant fuels• Energy saving and efficiency practices

• Waste management hierarchy: reuse;reduce; recycle

• Waste valorisation practices• Recycling programmes• Suitable waste storage areas• Efficient waste management equipment• Training of waste management personnel

• Periodic maintenance and replacement ofequipment and machines

• Enclosing noise sources• Noise barriers/screens• Proper planning of noisy activities• Use or quieter working

methods/technologies

INPUTAND

NATURALRESOURCES

Flora andFauna

Biodiversity

Watertable

Soil andgroundwater

Air

Habitat,natural

ecosystemsand landscape



78

Environmental managementand results

Spill prevention and response

Pollutant spills are one of the most significantenvironmental issues for the industry in whichSaipem operates. Spill prevention andresponse actions are an absolute priority forthe Company. Saipem operates byminimising the risk of spills and adoptsadvanced equipment and procedures toimplement actions that reduce and manageemergencies. The Saipem managementsystem is based on the following hierarchy ofactions:- Prevention: actions have been implemented

to identify specific areas of risk and improveprocesses and operational control of thosesites and vessels which are most at risk.

- Training and preparedness: specific trainingpackages are delivered on spill prevention,and spill drills are periodically organised.They are designed to strengthen

emergency management skills. The drillsare carried out both on land and at sea,involving, if necessary, clients or thirdparties designated for emergency responseactivities.

- Emergency response: all Saipem sites havethe necessary equipment for tackling anyemergency which may arise and specificSpill Response Teams have been set up.The sites implement a spill managementplan, which identifies the accident scenariosand response modes and can also includethe intervention of designated third parties.

- Reporting: the data concerning spills and‘near misses’ (events linked to operatingactivities that could have causedenvironmental damage) are monitored by aspecific software and subsequentlyanalysed to assess the causes, preventrecurrence and the ‘lessons learned’ areshared within the Company.

Further information on the actions taken bySaipem to reduce the risk of spills can befound in the ‘Safety for the environment’section of ‘Sustainable Saipem 2018’.

RISKS CONCERNING ISSUES COVERED BY ITALIAN LEGISLATIVE DECREE NO. 254/2016: ENVIRONMENTAL ASPECTS

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Risks identified by the Company* Summary of the adopted risk mitigation measuresS

pill

prev

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d re

spon

se Environmentalpollution

To prevent and mitigate this risk, Saipem has adopted an ISO 14001 certified environmentalmanagement system that applies to the Group’s most significant divisions from the operationalstandpoint. Furthermore, the Company employs environmental risk assessment techniques andtools and conducts audits and training and awareness courses for its personnel and maincontractors. Finally, the Group has put response plans in place to manage any environmentalemergencies.

Tech

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Failure to exploitof technologiesapplicable to theEngineering& Construction business(including digitisation)

Saipem is committed to developing and diversifying its portfolio of technologies and patentsthrough significant investment in research and development and to monitor technologicaldevelopments in the pertinent industries also performing benchmark analyses. A key element ofthe risk mitigation and prevention strategy is the initiative concerning its incubator of ideas andprototyping laboratory, ‘Factory of Innovation’, designed to test solutions that respond to thechallenges of the industry in which Saipem operates through new technologies (digital first andforemost) and new methods.

Failure to expandthe technologyportfolio linked to thede-carbonisation ofenergy

The mitigation and prevention of this risk is performed by focusing on the development oftechnologies and patents in the field of the energy de-carbonisation of energy (for example,renewable energy and CO2 management) through research and development. Moreover, Saipemis committed to continually monitor and further technological developments related to thede-carbonization of energy supplies.

Increase in operatingcosts due to extendedapplicability oflegislation onemissions ofgreenhouse gases(Carbon Tax or EmissionTrading Scheme)

Saipem is committed to constantly monitor the evolution of laws and regulations in the field ofgreenhouse gas emissions at the international level, in order to mitigate and prevent such risk.In addition, the Group has defined a four-year strategic plan with quantitative targets for thereduction of greenhouse gas emissions, which were applied at both the level of the division andcorporate levels.

(*) The water risk is not currently analysed, as does not appear to be a material topic.



79

The number of spills compared to theprevious year decreased in 2018.Taking into account the Group consolidatedperimeter, the total spill volume equalled 3.25m3 over 6.07 in 2017.The main event was a bitumen spill (1.7 m3) inthe soil from two tanks during liftingoperations in the scope of the Tangguh LNGExpansion project (Indonesia). The area waspromptly isolated and confined by twocontainment tanks. A recovery plan wasorganised.Considering the more extensive Group totalperimeter, the total spill volume for the yearequalled 7.22 m3 due to an oil spill (3.97 m3) atsea when unloading the FPSO Gimboa cargoship. The cause was due to a leak from a pipethat was clogged and bent. An emergencystop was promptly implemented and thecontaminated zone was subsequently cleanedwith a dispersing substance. Further testswere conducted, and passed, on the pipeafter this event and the ship was equippedwith new pipe for faster and preventive futurereplacements.

Energy efficiency and GHG emissions

Reducing its emissions, also through theimprovement of energy efficiency, is one ofthe company’s environmental priorities.In 2018, Saipem decided to further organiseits policy of reducing GHG emissions bydrafting a specific four-year plan to outlinea corporate vision on the issue of improvingthe efficiency of its activities and the resultingreduction of emissions.During the same year the Company also

reviewed the emission estimate method,expanding its boundaries, achieving itscertification from a third-party inaccordance with UNI EN ISO 14064-3:2012standards.The main changes to the methods concerned:- review of the emission factors used to

estimate emissions;- inclusion of new gas in the estimate

method;- inclusion in this method, of scope 2: indirect

emissions arising from electricitypurchases;

- inclusion of scope 3 field of application:indirect emissions related to air travel forbusiness.

The method is applied to calculate both GHGemissions and the following air pollutantemissions: NOx, CO2, CO, SO2, NMVOC, CH4,PM10 and N2O.Direct energy consumption increased by4% in 2018 over 2017 for the Groupconsolidated perimeter (3% consideringthe Group total perimeter), in line with theincrease in business on some significantoperating projects. Sites that experiencedthe most significant increases in energyconsumption over the previous year are listedbelow: Jazan Integrated GasificationCombined Cycle (Saudi Arabia), Tangguh LNGExpansion (Indonesia), Khankendi vessels(Azerbaijan), Castorone, Saipem 12000, ERSAIYard. An increase in Diesel consumption over2017 was experienced with the JazanIntegrated Gasification Combined Cycleproject which records the highestconsumption for the year and of Diesel MarineOil consumption, due to an increase ofCastorone pipelay vessel activities.

2016 2017 2018

Group Group Group Group Group Grouptotal consolidated total consolidated total consolidated

Number of spills

Total (No.) 30 28 26 23 18 17

Chemical spills (No.) 5 3 8 8 5 5

Oil spills (No.) 25 25 18 15 13 12

Volume of spills

Total (m3) 4.26 3.01 6.21 6.07 7.22 3.25

Chemical spills (m3) 0.71 0.18 3.58 3.58 0.77 0.77

Oil spills (m3) 3.54 2.83 2.63 2.49 6.46 2.49

2016 2017 2018


Indirect energy consumption

Electricity (MWh) 102,343.4 101,083.6 92,309.9 92,307.7 88,996 85,069

Renewable energy

Electricity produced from renewable sources (MWh) 305.0 305.0 352.4 352.3 297.6 297.6

It should be noted that the emission factors for the calculation of scope 1 and scope 2 have been updated in the course of 2018 and emission factors for the calculation of scope 3 were defined.



80

Water resource management

One of Saipem’s commitments expressed inthe HSE Policy comprises the protection ofnatural resources. Considering thegeographical location of the Company’simportant operating activities, water is asignificant aspect (albeit not identified as amaterial topic). In fact, Saipem is aware that iscarries out important operating activities inareas considered ‘under water stress’, wherethe implementation of a strategy to reduceconsumption and use the resourceefficiently is considered a priority.The re-use of water, after suitable treatment,is a key activity to minimise waterconsumption.The commitment to responsible managementof water resources is transmitted to allcompany levels through the issue of annualGroup HSE plans, which are then

implemented by the divisions and operatingcompanies.The reduction of water consumption recordedin 2018, compared to 2017, is mainly due tothe altered operational needs of someonshore projects such as, the CorneglianoLaudense gas storage facility (Italy) that isnearing completion, but which had recordedhigh consumption in 2017 due to aconsiderable quantity of drain water pumping.The significant increase in the percentage ofre-used water in 2018 is due to its use inactivities such as dust control, mainly in siteslocated in particular geographical areas suchas Saudi Arabia: projects which post thegreatest increases in re-used water are in factthe Jazan Integrated Gasification CombinedCycle and Khurais AFE and SATGOSPprojects. Drained water has decreased morethan proportionately to the decrease in waterconsumed.

Direct energy consumption(ktoe)

0

50

100

150

200

250

300

Grouptotal

Groupconsolidated

Grouptotal

Groupconsolidated

Grouptotal

Groupconsolidated

Gasoline

Diesel Marine Oil (DMO)

Diesel

Light Fuel Oil (LFO)

Intermediate Fuel Oil (IFO)

Heavy Fuel Oil (HFO)

Natural Gas

388.1

2016 2017 2018

424.0432.9409.5419.3370.5

1.49.5 9.5 11.5 11.4 9.2 9.2

111.8 111.8

141.8 141.8

173.2 170.8

256.6238.9 246.6

236.9230.5 224.0

1.4 1.3 4.5 4.512.3 12.3

7.5 7.512.8 12.8

7.2 7.2- - 1.0 1.0 - -

1.4 1.1 1.1 0.6 0.6

Emissions(kt CO

2 eq)

0

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700

1,050

1,400

Grouptotal

Groupconsolidated

Grouptotal

Groupconsolidated

Grouptotal

Groupconsolidated

Direct GHG emissions(scope 1)

Indirect GHG emissions(scope 2)

Induced GHG emissions(scope 3)

2016

1,242.3

2017 2018

1,203.4

38.9- - - -

58.2 58.1-

37.5 37.5 35.7 33.8

1,177.2

1,299.71,269.3

1,348.8 1,320.9

Note: Saipem began calculating scope 3 emissions as of reporting year 2018. Furthermore, it should be noted that scope 2 emissions were not calculated for the Group consolidated

perimeter in 2016 since Legislative Decree No. 254/2016 was not yet in effect.

1,412.81,442.71,306.81,337.21,177.2



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Waste management

The Company implements a responsiblewaste management system that is specific forthe type of operating activities.Waste management is tackled by applyinga hierarchy of operations mainly aimed atminimising the waste produced through theuse of appropriate procedures ortechnologies, re-using it as material andrecycling it after the most appropriatetreatment.Priority is given to hazardous waste in thecontext of action aimed at minimising wastegeneration. The company promotes andimplements measures, also through theresearch and development of new materials,which allow hazardous materials to bereplaced with non-harmful alternatives.Saipem ensures appropriate wastemanagement though waste managementprocedures/plans at both operating companylevel and individual project and site level.

The significant decrease (11% for Groupconsolidated and 12% for the Group totalperimeter) in waste production, over 2017,is mainly due to the completion of civil worksto the South Stream WP 5.1 project (Russia)for which an enormous amount of soil, rocksand dredging materials had been managedand recycled in 2017 and reported asnon-hazardous waste discarded in landfill.Thus, there was a 58% reduction ofnon-hazardous recycled waste in 2018 forthe Group consolidated perimeter (56% forthe Group total perimeter). The increase(12% for the Group consolidated and 9%for the Group total) in the production ofnon-hazardous waste disposed of inlandfills recorded in 2018 is attributable tothe Cornegliano Laudense gas storage plantproject (Italy) and the Khurais AFE andSATGOSP projects (Saudi Arabia).As regards hazardous waste disposed of inlandfills, there was an increase (67% forboth perimeters) due mainly to the activities

Water consumption2016 2017 2018


Recycled and re-used water

Re-used water(103 m3) 308.4 308.5 1,179.8 1,179.2 1,641.0 1,640.8

(%) 4 4 15 16 24 24

Sewage water discharges2016 2017 2018

Group Group Group Group Group Group(103 m3) total consolidated total consolidated total consolidated

Total dumped water, of which: 4,858.9 4,745.8 5,657.0 5,536.7 4,232.9 4,099.7

- water discharged into the sewer systems 427.7 485.4 642.8 642.8 380.4 377.6

- water discharged into bodies of surface water 2,556.3 2,504.6 3,605.4 3,605.4 2,388.6 2,388.6

- water discharged into the sea 1,142.7 1,023.6 515.4 395.1 729.3 677.3

- water discharged to other destinations 732.2 732.2 893.4 893.4 734.7 656.3

Water consumption(103 m3)

0

1,000

2,000

3,000

4,000

5,000

6,000

Grouptotal

Groupconsolidated

Grouptotal

Groupconsolidated

Grouptotal

Groupconsolidated

Sea water

Water from above-groundwaterways

Groundwater

Fresh water/fromwaterworks

6,972.9

2016 2017 2018

6,708.16,850.87,546.07,690.46,807.3

3,054.5

2,571.9

69.5

1,276.9 1,254.5

685.8 672.1

1,014.9 1,000.2

69.5188.3 188.3 266.1 222.9

2,499.6

5,441.2 5,368.1

4,532.64,451.9

2,983.6

1,375.1 1,317.5

1,037.1 1,033.2



82

carried out in the Karimun yard (Indonesia) andto some onshore projects: Al Zour NewRefinery Project, for the quantity of sludgecoming from the waste water treatment plantof the new accommodation camp, Rabigh II(Saudi Arabia) for the disposal of used oil.

Furthermore, following the world environmentday theme, in 2018 Saipem also implementedspecific campaigns with the directinvolvement of senior management, as well asfurther initiatives aimed at collecting andreducing plastic waste.

SOCIAL ASPECTSCULTUREAND LIFESTYLE

DEMOGRAPHICSWELFAREAND SOCIALINFRASTRUCTURES

ECONOMICIMPACT

MAINSOCIAL IMPACTS

- Erosion of traditional valuesand customs

- Increase in the socialproblems of some vulnerablepopulation groups

- Discrimination andmarginalisation ofindigenous people

- Risk of conflict and localunrest

- Immigration due to theattractiveness of thegeographical area of the site

- Emigration/relocation due tothe traditional use of naturalresources competing orconflicting with projectactivities

- Effect on local facilities andpublic health

- Effect on traffic and roadsafety

- Access to socialinfrastructures

- Increase in direct andindirect employment and inwage levels

- Increase in prices of goodsand inflation rate

- Purchasing of local suppliesand boost in general localeconomy

- Changes in local economicstructure

- Increase in dependency ofthe local economic systemon a specific industrialsector

POTENTIALMITIGATIONMEASURES

- Cultural Heritage protectionplan

- Proper selection of securityproviders

- Drug and alcohol testing ofthe workforce

- Cultural awareness sessionsand human rights trainingprogrammes for employees

- Transparent recruitmentstrategy

- Management of localexpectations

- Health promotion initiatives- Safe driving awareness

sessions

- Transparent recruitmentand hiring strategy

TOOLS ADOPTED Stakeholder consultation, community grievance mechanism and local community relations plan

2016 2017 2018

Group Group Group Group Group Group(kt) total consolidated total consolidated total consolidated

Total weight of waste produced, of which: 907.6 902.0 431.3 426.0 381.5 378.6

- hazardous waste disposed of in landfill sites 36.1 (*) 36.0 61.2 61.1 102.2 102.1

- incinerated hazardous waste 1.6 1.5 2.3 2.3 4.2 4.2

- recycled hazardous waste 18.7 18.3 6.9 6.9 3.5 3.4

- non-hazardous waste disposed of in landfill sites 140.0 (*) 135.6 172.4 168.6 188.3 188.2

- incinerated non-hazardous waste 3.0 3.0 3.6 2.6 2.7 2.7

- recycled non-hazardous waste 708.1 707.4 185.0 184.6 80.6 78.2

(*) These data have been modified against the previous year because of a recalculation.

Social aspects

Social policies and management

The Company operates in over 60 culturallyand geographically different and distantcountries often in contexts characterised bydifficult situations and border issues, eachcharacterised by issues that the Companytakes into account when assessing socialaspects linked to its activities.Saipem uses social-economic impactevaluations and studies supplied by its

clients or, if necessary, produced in-house.The operations where Saipem has directresponsibility for the impacts generated atlocal level concern the fabrication yards orproprietary logistic bases. In these cases,Saipem identifies and assesses the potentialeffects of its activities and actions in order toensure that they are managed appropriately,as well as any specific activities and projectsaimed at developing the local socio-economiccontext working with the identified localstakeholders.



83

Particularly in the countries where thecompany’s presence is medium/long term,Saipem has established a lasting relationshipof mutual collaboration with the localstakeholders. Some significant examples arethe collaborations with universities andschools, representatives of local institutions,non-governmental organisations active in theareas and local bodies for developmentprogrammes and the promotion of health.In addition to what is detailed in thisdocument, Saipem provides a thoroughdescription of stakeholder engagementactions in a specific section (‘Stakeholderengagement in 2018’) of the ‘SustainableSaipem 2018’ document. Saipem is alwayscommitted to minimising any negativeimpacts at the local level and contributing tomaximising positive impacts through theimplementation of strategies that supportsustainable local development. The overall

risk profile (including the social one) for everyproject is identified, analysed and monitoredfrom the commercial phase. An important toolis listening to the demands of the localstakeholders, also by means of consolidatedengagement processes. In particular, for themanagement of negative impacts, theCompany has drawn up a principle (Guidanceon Grievance Management) for structuring asystem to collect and manage the demandsof the local communities in the operatingbusinesses where it is considered necessary.This process allows potential negativeimpacts on the Company to be identified,managed or mitigated.Different geographical bases (e.g. Nigeria,Azerbaijan, Italy, Russia) and some of the moresignificant operating businesses (e.g. TangguhLNG Expansion) have implemented suchsystems to ensure effective communicationwith the communities.

Analysis of the context Identification and assessmentof potential impact

Identification and implementationof mitigation measures

Analysis of the socio-political, cultural andeconomic conditions of the areainterested by the project.

Identification and subsequent evaluation ofthe impacts occurring during the entirelife of the project.The impacts can be classified as:- direct impacts: that are a direct result of

project activities;- indirect impacts: that result from other

developments or activities that wouldonly occur as a result of the project.

The purpose of adopting mitigationmeasures is to remove, minimise and/orcompensate residual adverse effects to areasonably feasible extent.Mitigation measures could consist of theintegration of proposed actions into thedesign of the project, changing or addingtechnical or managerial aspects.Mitigation actions could include activitiesto be implemented both within the projectsite and in neighbourhood areas.

STAKEHOLDER ENGAGEMENT PROCESS

RISKS CONCERNING ISSUES COVERED BY ITALIAN LEGISLATIVE DECREE NO. 254/2016: SOCIAL ASPECTS

Man

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in Fraudulent activity,corruption, lack oftransparency, loss ofconfidentialinformation and data, and nonconformities with proceduresand regulations.

Saipem updates its organisation, management and control model pursuant to Legislative Decree No.231/2001 (hereinafter, ‘Model 231’), which is aimed at preventing the possible offences sanctioned bythis legislation; ‘Model 231’ includes the Saipem Code of Ethics, which contains the set of rights, dutiesand responsibilities addressed to Model recipients. In addition, Saipem is engaged in training activities onethical issues, including anti-corruption, and on updates to ‘Model 231’. The Company has developed ananti-corruption management system that has recently obtained certification of compliance with theinternational standard ISO 37001. Lastly, the Group has a monitoring and control system in place forvendors who may engage in fraudulent activities, possibly evaluating their suspension.

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Social aspect managementactivities and results

Relations with the local context

Saipem is committed to establishing relationswith its local stakeholders based on fairnessand transparency in order to pursue concreteshared objectives for sustainabledevelopment. This is also achieved bystrengthening mutual trust, seeking dialogueand promoting the right conditions in order toestablish lasting cooperation in the countrieswhere the Company operates.Wherever it operates, Saipem contributes tothe social and economic life of the territory,also and not only in terms of localemployment and creation of value.Saipem’s relations with local stakeholderstherefore depends on the type of operatingpresence in each particular area.This presence is divided between long-termpresence, where the Company ownsfabrication yards or other operating structuresthat allow complex relations and partnershipswith various local stakeholders to beestablished; and short/mid-term presence,where Saipem is involved in a specific projectwithin set contract deadlines in which Saipemparticipates in more targeted and short-termsustainable development initiatives.Saipem’s involvement and dialogue with localstakeholders therefore depends on the typeof presence in each particular area, contractrequirements set by clients on projects andlocal partners.Where Saipem intends to create new,long-term work sites, the Company carries outspecific assessments designed to analyse thepotential effects of its activities on the localsocio-economic context. To achieve this goal,it uses tools such as the ESIA (EnvironmentalSocial Impact Assessment), based on whichthe Company defines action plans to

manage the impacts on local communitiesand stakeholder engagement. To supportthis process, Saipem has implementedspecific tools for analysing the local contextand for the identification and analysis of themain stakeholders for the purpose of definingaction plans.In operating projects, Saipem supports theclient’s activities, in line with contract requestsand requirements the latter received and/oragreed with local authorities through specificstudies such as EIA (Environmental ImpactAssessment) or also using, in this case, ESIA(Environmental and Social ImpactAssessment).

Local presence

For Saipem, being present locally meansacquiring goods and services from localvendors, creating employment at a locallevel and developing the know-how of thelocal personnel and vendors, strengtheningtheir technological and managerial skills.In this way Saipem contributes to creatingdevelopment opportunities for the people andcompanies in those communities where itoperates. Saipem’s presence is alsocharacterised by a commitment to developingand maintaining a continuous relationship withlocal communities, clients and local vendorsmaking it possible to obtain benefits also interms of reductions in overall project costsand the overall risk profile associated withoperational activities.Saipem has developed internally a model(SELCE, ‘Saipem Externalities LocalContent Evaluation’) to quantify the value ofits presence locally in economic, employmentand growth of human capital terms.The SELCE model was validated in 2015 byNomisma Energia in its application to theItalian context.

Local employment2016 2017 2018

Group Group Group Group Group Group(%) total consolidated total consolidated total consolidated

Local employees 80 78 76 74 73 71

Local managers 45 44 46 45 45 44

An employee is considered local if he/she works in the country where he/she was hired. Local manager means the total of the middle and senior managers. The percent of local managers iscalculated excluding data from France and Italy.

In 2018, local personnel stood at 71%(73% in the Group total perimeter), a figurethat saw a reduction against the previous yearmainly due to the reduction or conclusion ofthe operating activities in projects where thepersonnel was mainly local. The percentage,despite the slight reduction, remains very highand concretely demonstrates Saipem’sconstant commitment to creating value in theareas where it operates. This occurs throughthe employment of local personnel and the

strengthening of their managerial andtechnical competence and skills throughtraining and on-the job experiences.

Management of an ethical supply chain

Saipem has more than 23,000 first-tiervendors, of which approximately 7,000qualified during the year. From a numericalpoint of view, the main geographical areas



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where the Company’s vendors operate areEurope and the Americas. In 2018, thegeographical areas in which Saipem orderedthe most significant amount of goods andservices were Europe and the Middle East.Saipem selects partners that share the samevalues and makes them active participants inthe risk prevention process (ref. Policy ‘Ourpartners in the value chain’). In over 60 yearsof operating in most of the countries aroundthe world, Saipem has created a consistentand profitable network of partners andvendors; over 5,000 vendors have workedwith Saipem for more than 10 years.Saipem is committed to conducting relationswith vendors in accordance with the highest

ethical standards, in compliance with all theapplicable laws and the Code of Ethics,safeguarding its own reputation and that of itssubsidiaries.The Company has identified aspects ofsustainability that have been identified aspriorities in the management of its supplychain, which concern the ethical nature of thevendor, respect for human and labour rights,and protection of the environment and theprotection of its workers in terms of healthand safety.These aspects are integrated into the supplychain management system, which iscomposed of several interrelated phases, asoutlined and described below.

Vendor performance feedback

Supply chain management system

Vendor qualification Contractual phase Contract execution

Vendor qualificationFrom the point of view of human and labourrights, vendors operating in countriesclassified as high risk on these themes areanalysed on the basis of the information anddocuments that they submit during thequalification phase. Similarly, for certaincommodity codes considered high risk from ahealth and safety point of view, an ad hocassessment is carried out to assess thevendor’s HSE management system and itsability to manage these issues.Moreover, for specific commodity codes,vendors undergo a counterparty riskassessment process. This includes ananalysis of its capabilities in economic,financial and organisational terms, as wellas a risk assessment with regard tocorruption, illegal conduct and any otheraspect that could directly harm the vendor’sreputation and, indirectly, the reputation ofSaipem. This is ensured through in-depthchecks, which include the involvement of thevendor in any type of criminal offence orterrorist activity, the structure of its controlchain, the management and Board ofDirectors/owner in order to ensurecompliance with Saipem anti-corruptionguidelines.Based on the vendor’s critical nature, thequalification process can require verificationof its activities in loco, as well as its technical,managerial, production, quality, HSE andlogistics capabilities.If operating in high risk countries, thevendors may undergo on-site verificationregarding labour rights. The verification

concentrates on the following issues: childlabour and forced labour, freedom ofassociation and right of collective bargaining,salaries, working hours, discrimination,disciplinary measures, health and safety.

Contractual phaseThe general contract conditions negotiatedby Saipem include all the main requirementsthat cover sustainability topics.Vendors state that they have received andacknowledge the contents of the‘Sustainability Policy’ whereby Saipemundertakes to act as a sustainable Companyand contribute to the long-term growth andvalue creation through the effectiveinvolvement of all stakeholders.Moreover, vendors working with Saipem SpAare required to accept Model 231, whichincludes the Saipem Code of Ethics.Similarly, vendors working with thesubsidiaries of Saipem SpA must accept theOrganisational, Management and ControlModel (OM&C Model) and the Code of Ethics.When the value of the supply for specificactivities, services and materials exceeds apredetermined amount, the specific vendoris subject to a counterparty risk assessment.For specific commodity codes considered ashigh risk for HSE, Saipem conducts a specificassessment in terms of the vendor’s abilityand organisation to perform the contractaccording to international workers’ protectionstandards. Subsequently, specificrequirements are defined in the contractbased on the type of service the vendorprovides.



86

Contract performance and vendorfeedbackVendor performance is continuouslymonitored and Saipem’s relevant functionsare also asked to provide feedback regardingrespect for workers’ rights and theprotection of health and safety (e.g.occurrence of accidents/injuries during workexecution, compliance with applicable HSE

legislation and contractual specifications,existence of legal proceedings for seriousviolations/offences).The feedback received guarantees theassessment of the vendor’s overall reliabilityand the possibility of interrupting orsuspending the qualification in the eventof serious situations encountered.

2016 2017 2018

Active vendors (No.) 29,959 26,345 23,845

Qualified vendors (No.) 6,571 6,918 7,026

Vendors qualified in the year which operate in countriesat high risk of violating human and labour rights (%) 60 59 40 (*)

New vendors assessed on labour rights (No.) 106 94 174

Vendors qualified in the year for activities considered at HSE risk (%) 6 4 7

Vendors assessed on HSE aspects (No.) 385 278 466 (**)

Qualification audits, of which: (No.) 46 62 28

- on human and labour rights (No.) 6 14 10

It must be stated that the numbers in the table are representative both for the total perimeter of the Group total and the Group consolidated perimeters, because a qualified vendor at corporatelevel can potentially work with all the businesses in the Group.(*) For a more transparent representation of the indicator, as of 2018 it is calculated on the number of qualified vendors, rather than on the number of completed qualification processes. (**) The methodology was changed from the previous year due to a methodological refinement that allows for a more accurate representation of the indicator.

Participants in training on sustainable supply chain(number)

0

50

100

150

200

250

2016 2017 2018

147

115

237

Saipem people

People policies and management

As described in the Policy ‘Our People’ on themanagement of human capital ‘people are theindispensable and fundamental element forthe very existence of the business andcompany objectives can only be achievedwith their dedication and professionalism’.The professional knowledge of our people isfundamental for sustainable growth and anasset to be safeguarded, valorised anddeveloped. Developing a knowledge-sharingculture is a primary means to consolidatingthe wealth of acquired knowledge andexperience.



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Risks associated with human resource management

RISKS CONCERNING ISSUES COVERED BY ITALIAN LEGISLATIVE DECREE NO. 254/2016: PEOPLE MANAGEMENT

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Risks identified by the Company Summary of the adopted risk mitigation measuresP

eopl

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fety Accidents in the course

of operational activitiesthat can cause injuriesand even the death ofSaipem employees or vendorsand subcontractors’ staff.

Saipem is committed to both preventing and mitigating these risks through specialised trainingprogrammes dedicated to employees, as well as to its vendors and subcontractors, on technicaltopics and on work safety with the aim of ensuring high quality standards in training.Furthermore, the Company is involved in numerous initiatives, such as the ‘Leadership in Health& Safety’ programme (LiHS), the campaign dedicated to ‘Life Saving Rules’. Finally, the mostsignificant Group entities from the point of view of operations are OHSAS 18001 certified.

Saf

e op

erat

ions

, ass

et in

tegr

ity

and

proc

ess

safe

tyH

ealt

h an

dw

ell-

bein

g

Critical issues relatedto political, social andeconomic instabilityand terrorist threats tostaff, operations, business andassets.

The Group is involved in the constant monitoring of various critical issues (in particular political, social,economic) and terrorist threats in verifying the adequacy of the mitigation measures in place, makinguse of an intelligence network and actively cooperating with the police forces and security serviceproviders in the countries where it operates. In particular, Saipem has developed security plans and acrisis management system. Finally, the Group pursues a commercial strategy with strong projectselectivity, also taking into consideration the risks associated with the country of operations.

Significant accidentsto Saipem’s strategicassets or customerinfrastructures.

To mitigate and prevent this risk, Saipem incurs significant expenses for the maintenance of itsassets and has developed various prevention initiatives, including the application of the AssetIntegrity Management System and the development of Safety Cases, as well as the specific trainingfor technical personnel.

Damages ofexogenous andendogenous origin tostaff health (forexample, legionella, malaria,rabies, etc.).

The Group has set up a programme for defining, implementing and monitoring health facilities andphysicians responsible for managing personnel health, with the aim of avoiding and mitigating theserisks. Furthermore, Saipem carries out training and awareness-raising initiatives on health issues,continuously monitors the health situation and has developed tele-medicine programmes in thecountries where it operates. In the event of serious consequences for the health of personnel,Saipem has a system for managing medical emergencies and repatriation in the case of patients incritical conditions.

Trai

ning

and

dev

elop

men

tTa

lent

att

ract

ion

and

rete

ntio

n Loss or lack of keyskills.

Saipem periodically plans human resource needs based on business objectives, taking into accountavailable and necessary skills with a particular focus on key skills and ensuring an effectivedistribution of personnel within the Group (also on the basis of job rotation programmes).Furthermore, the Group organises various training programmes on critical business skills and hasdeveloped a structured methodology for career paths and compensation systems (e.g. long-termincentives).

People management and results

Workforce trend

2016 2017 2018


Total employees at period end (No.) 40,305 36,859 35,918 32,058 34,129 31,693

Employee categories

Senior Managers (No,) 399 396 398 393 385 380

Managers (No,) 4,276 4,149 4,190 4,089 4,187 4,091

White Collars (No,) 18,496 16,721 16,642 14,971 16,633 15,323

Blue Collars (No,) 17,134 15,593 14,688 12,605 12,924 11,899

Type of contract

Employees with full-time contracts (No,) 40,060 36,615 35,686 31,826 33,906 31,470

Employees with key professional role (No,) 14,991 14,161 14,177 13,154 14,123 13,468

Employees recruited through an employment agency (No,) 5,643 4,403 5,829 4,111 7,380 6,869

Turnover

Voluntary turnover of resourceswith key professional role (%) 8.3 - 6.6 6.2 7.3 6.6

Total turnover (%) 40 - 35 36 31 27

The total turnover is calculated as the ratio between annual exits and the average resources in the year. Voluntary turnover of resources with a key professional role is calculated as a ratiobetween all the annual voluntary exits and the average of the resources that cover a key professional role.



88

The workforce in 2018 decreased comparedto 2017 due to the conclusion of someprojects and the reduction of operationsmainly in Nigeria (Southern Swamp Project),Indonesia (Karimun Yard) and Saudi Arabia(Jazan Project). This reduction was partiallyoffset by the increase in activities related tothe development of projects in Chile, relatingto the Onshore E&C (Spence Growth Project)business, and the increase in internationalresources on board vessels with regard to theOffshore E&C business.The overall turnover rate in 2018experienced a reduction compared to2017 and was 27% (31% for the Grouptotal perimeter); a value which, althoughdecreasing, remains at a significant level dueto:(a) the extremely dynamic situation in the Oil

& Gas market, which led to a reduction inoperating activities, following a significantdecrease in investments in the sector;

(b) the nature of Saipem’s business which,being a contractor, works for large-scaleprojects that have variable durations (froma few months to years). Taking intoaccount these peculiarities, thequali-quantitative size of Saipem’s humancapital is therefore subject to a naturalfluctuation connected with the differentoperating phases of projects and thecyclical nature of customers’ investment.

The increase in agency personnel was

influenced in particular by the operatingactivities implemented in the Ersai yard, forthe EPC Khurais (Saudi Arabia) project, forMaintenance Modification and Operationprojects in Congo and for the DS6debottlenecking project of the West Qurnafield (Iraq).

Skills and knowledge development

The Company has confirmed by the way itoperates that the importance of skills is adistinct and distinctive element of Saipem anda source of competitive advantage in thereference market. In line with the evolution ofthe business scenario, a programme waslaunched in 2018, which provided for therevision of the HR strategy, considering skillsas a key driver of all processes.In line with the HR strategy aimed atsafeguarding and enhancing distinctive skills –which focuses on the Saipem resourceintended as the bearer of a set of criticalbusiness skills and extended experiencesgained over the course of their working life – aStrategic Workforce Planning process, wasdeveloped, supporting and integrating theconsolidated HR Planning process, focusedon core professional roles (defined bycorrelating the impact and severity that theseroles have on Saipem’s activities with aspectsof replacement complexity) and closely linked

Group total

Group consolidated

Group total

Group consolidated

Group total

Group consolidated2016

2017

2018

Americas CISEurope MiddleEast

NorthAfrica

Sub-SaharanAfrica

FarEast

2,477 911 10,066 4,886 10,645 2,110 3,034

2,477 911 9,590 3,713 9,859 2,109 3,034

1,849 669 10,283 5,589 11,472 2,743 3,313

1,849 669 9,621 4,554 9,571 2,481 3,313

3,083 1,268 9,962 6,637 9,219 3,169 6,967

3,083 1,261 9,249 5,197 8,177 2,925 6,967

Employees by geographical area(No.)



89

to the indications contained in the SaipemStrategic Plan. The output of the processmakes it possible to monitor the actual needsand the level of coverage of theseprofessional roles and to monitor the level ofcompany skills for the next four years in orderto be able to adequately set the mostappropriate actions to be taken to satisfy theneeds that emerged in terms of marketrecruitment or actions to develop and traininternal resources.The process has also provided for theupdating of the professional skills thatSaipem monitors and assesses, also tointegrate them with the capabilities requiredby the innovation and digital transformationthat Saipem is facing, as well as those derivingfrom the prospective businesses of interestfor Saipem. As a result, professional roleshave also been updated.The initiatives undertaken in terms ofdevelopment and growth of the youngestresources and as a transfer of skillsguarded by the most expert resources,have focused on:- attraction of new talent from the labour

market with the aim of generationalturnover;

- introduction of new ways of transferringknowledge between people of differentgenerations;

- improving managerial skills in growingresources through training and targeteddevelopment actions.

The objective of strengthening the attractionas a source of generational change was alsopursued through a Graduate Programme,which allowed Saipem to reach youngstudents from the best Italian universities byselecting undergraduate and graduatestudents to be introduced through aninternship. About 3,000 candidates wentthrough a very strict selection process at theend of which talented young people wereselected to embark on a professionalexperience in Saipem.Furthermore, in 2018 the individual Divisionssuccessfully implemented additionalrecruitment actions from the external marketin Italy and in the main foreign hubs. This wasboth for new resources to grow internally andfor critical professional roles, and with longtraining times (for example the orientationpath of 10 Vessel Equipment Engineers forthe Offshore E&C Division, and the YoungGraduate programme for the Onshore E&CDivision).In line with attraction objectives aimed atincreasing the employability of youngstudents and creating a pool of excellence forthe selection of young experts andtechnicians, the Company confirmed itscommitment to the Synergy Programme.This programme places Saipem on the frontlines as an ally of scholastic and territorialinstitutions to support the training of students

in internship programmes. In addition toconfirming the well-established commitmentswith the Volta of Lodi and Fermi high schoolsin Lecce, Saipem has expanded itsprogramme through the involvement of newinstitutes present in regions of interest to thebusiness. Starting from the 2018-2019 schoolyear, ‘teachers of the trade’ will return toschool as instructors at the ISII Marconi ofPiacenza and the IANAS and ITI institutes ofTortolì to promote skills in the fields of Drillingand Fabrication.The transfer of knowledge is an essentialprocess for Saipem that is realised not only bysupporting the motivation of the most expertresources through the tutoring of theyoungest resources, but also by creating theorganisational conditions so that the youngpeople can share their knowledge, such asthose in the digital environment.The exchange of knowledge and skillsbetween different generations was thereforestrongly encouraged through variousinitiatives, including Reverse Mentoring,which provided for the sharing of knowledgeand skills between people with differentseniority in terms of mutual exchange.The initiatives aimed at spreading theLeadership Model, the reference paradigmfor all Saipem resources, continue.The Company has developed variousinduction, monitoring and personaldevelopment programmes, also with the aimof spreading a unique message of corporateidentity and culture.In 2018, new development and assessmenttools for the behavioural skills of theLeadership Model were designed andupdated. In particular, with the objective ofassessing personal abilities and addressingtraining and development actions in the bestpossible way, the potential assessmentprocess for young talents was reviewed.The training course, completed in June 2018,dedicated to Saipem Senior Managers andcarried out together with the MIP - MilanPolytechnic, represented a further opportunityto further the Leadership Model. The courseincluded a ‘blended’ delivery method, e.g.alternating classroom sessions with lecturesprovided on-line through a dedicatedplatform.During 2018, activities were initiatedpertaining to the Managerial Academy,training initiatives, institutional and transversalwith respect to the businesses, designed withthe aim of increasing the wealth of managerialand behavioural skills of the people, thussupporting their development andprofessional career path. Each training coursewas organised with the aim of enhancing oneor more behavioural skills linked to one of thesix pillars of the Saipem Leadership Model.In this field of activity, the training initiative‘Communication skills - Be a Leader’,gained particular significance. The course



90

represented an opportunity for participants todevelop and consolidate their communicationskills, and was promoted with the desire tosupport Saipem Managers in theirresponsibilities for managing and developingpeople, and more specifically in the activitiesof communication and dissemination ofcompany guidelines.During the year, specific training projectswere also developed dedicated to thedevelopment of critical professionaltechnical skills. For example, trainingcourses dedicated to renewable energy andrelated technologies have been developedwithin the XSIGHT Division. In the samedivisional context, new training activitiesbased on the gamification methodologywere also tested.In line with the objectives of monitoring skillsand creating development opportunities foryoung people, the Succession Planmethodology was updated based on threemain drivers: generational turnover, crossfertilisation of Saipem’s businesses andmapping of the technical and managerial skillsneeded to fill target positions in the future.The annual process of updating thesuccession tables concluded with an analysisof the risk areas on which it is necessary tointervene and plan the necessary actions.The Human Resources DevelopmentCommittee was set up, with the objective ofmonitoring and guiding the development andcareer of young people, as well as assessingtheir professional and managerial paths.In particular, the Committee verifies theresponse of the resources to therequirements of the Leadership Model andpromotes career plans and inter-departmentaland inter-divisional mobility, enhancing youngtalents in order to create value for the entirecompany.With the aim of constantly investing inyounger generations, Saipem invests in the

creation of specialised skills and transfer ofknow-how also through classroom andon-the-job training programmes aimed atyoung students from schools and universitieswith which the company initiates long-termpartnerships.In 2018, the total number of training hoursprovided increased compared to theprevious year due to an increase in the hoursof HSE training and in particular of the portiondistributed to subcontractors, which totalled1,262,965 hours.The hours of employee training increasedcompared to the previous year, despite thedecrease in the workforce during the year.HSE training represents the quantitativelymost significant type of training organisedover the year. An average of 18.5 hours ofHSE training were provided for employeesin 2018 (17.7 if one considers the Group totalperimeter), an improvement on 2017.On average, every employee attended 25.4hours of training courses (24.1 at Grouplevel), an increase on the 24 (21.9 at Grouplevel) provided in 2017.There was a very positive trend in relation tomanagerial training provided in 2018; in fact,the latter rose by 85% compared to 2017following an increase in the managerial andinstitutional training offered mainly for thebenefit of the employees of Saipem SpA’sItalian offices.In 2018, there was a 38% growth in thepopulation monitored throughperformance assessment tools comparedto 2017 for the Group total perimeter.This improvement is attributable to a greaterfamiliarisation with the system that supportsthe management of the recently modifiedevaluation process. In particular, there is anincrease in the coverage of the tool in thepopulation of employees classified as BlueCollar workers.

2016 2017 2018


Training

Total hours of training, of which: (hours) 1,570,894 1,542,514 1,930,709 1,908,702 2,086,681 2,059,822

- HSE (employees and subcontractors) (hours) 1,324,853 1,297,778 1,699,674 1,677,713 1,867,401 1,840,555

- managerial potential and skills (hours) 24,446 24,385 15,090 15,090 27,934 27,934

- professional technical skills (*) (hours) 221,595 220,351 215,945 215,899 191,347 191,333

Performance assessment

Employees undergoing performance assessment, (No,) 24,144 - 9,844 - 13,568 13,130of which: (%) 60 - 27 - 40 41

Senior Managers (No,) 375 - 359 - 372 372

Managers (No,) 3,034 - 2,918 - 2,452 2,452

White Collars (No,) 10,054 - 5,781 - 7,211 6,785

Blue Collars (No,) 10,362 - 786 - 3,533 3,521

(*) Please note that in 2018 the values of the ‘IT and language’ training were aggregated under the heading ‘Professional technical skills’.



91

Industrial relations

The global context in which Saipem operates,characterised by the management of diversityof specific socio-cultural and economiccontext means that the management ofindustrial relations requires the utmost careand attention.Over the years Saipem has consolidatedindustrial relations model aimed at ensuringthe harmonisation and optimal managementof relations with trade unions (OO.SS.),employees, employers’ associations,institutions and public bodies in line withcompany policies.With reference to the commitment tostrengthen dialogue with social partnership,the first meeting of the Saipem GroupEuropean Works Council (EWC), was held inSeptember in Milan which involved CompanyManagement and a delegation of 26representatives of the workers employed byGroup entities operating in Europe, in additionto the national and general representatives ofthe Italian trade union and a representative ofindustrialists. The three days of meetingslaunched the permanent mechanism forinformation and consultation betweencompany management and the workforce, incompliance with the relevant Europeanlegislation reflected in the Saipem EWCagreement negotiated in 2017. The meetingwas an important occasion of confrontationand discussion between the company andworkers’ representatives, fully integrating itselfwithin the ‘participatory’ model of industrialrelations to which Saipem adheres.On the international industrial relations,front, bargaining agreements were renewed inPeru in 2018 for personnel employed inonshore drilling, in Nigeria for Onshore E&C

personnel and in Indonesia for Offshore E&Cpersonnel.A new bargaining agreement was signed inChile with the SINAMIND union for localworkers employed in the Spencer GrowthOption (SGO) project, while in Argentina thePetrex SA Argentina Branch companyadhered to sector agreements, to protect thestaff employed in drilling, applicable to theprovinces in which the company operates.In Norway, consultations were held with thetrade union organisations Saipem EmployeesAssociation (SEA), SAFE, DSO and Lederne, inaccordance with local legislation.With regard to industrial relations in Italy, in2018 the relationship with trade unions it hasremained constant and constructive, both atthe level of the National Secretariats and withthe union representative of the variousoffices.With regard to national sector bargainingagreement, the renewal process for theEnergy and Oil National Collective LabourAgreement, which expired at the end of 2018,was launched.In terms of company agreements, the newFramework Agreement for the ProductionBonus was signed for the three-year period2018-2020, whose system, in line with thenew organisational model, values thecontribution provided by each Division inreaching corporate objectives.A process of sharing objectives and thedevelopment of the project with trade unionswas launched which, following periodicmeetings, ended with a specific agreementaimed at defining the start of a smartworkingpilot project whose application will beprogressively deployed within the variousItalian offices as part of the FlexibilityProgramme.

2016 2017 2018


Employees covered by collective bargaining (%) 58 60 49 62 47 46

Strike hours (No.) 65,196 55,961 1,143 1,143 23,699 23,699

Of more than 25,000 employees (more than27,000, if we consider the Group total)monitored (the total includes full-time Italianemployees, French employees irrespective ofthe country they work in and local employeesfor all the other countries), 11,824 (12,404 atGroup total) workers are covered bycollective bargaining agreements.The downward trend for the Group total canbe attributed to the fact that a growingproportion of Saipem personnel work incountries where these types of agreementsare not provided for. At the same time, therehas been a reduction of personnel in areaswhere these types of agreements arewidespread (Indonesia, Kazakhstan andNigeria).

Some strikes were held in 2018 for a total of23,699 hours. Strikes were held in Nigeria(where 97% of strike hours were recorded)and in Norway. In many cases the events werein conjunction with national events.

Diversity and equal opportunities

Saipem is committed to creating a workenvironment where different characteristics orpersonal or cultural orientations areconsidered a resource and a source of mutualenrichment, as well as being an inalienableelement of business sustainability.This commitment is a founding point of thePolicy ‘Our People’.



92

As defined in the Code of Ethics, in fullcompliance with applicable legal andcontractual provisions, Saipem undertakesto offer equal opportunities to all itsemployees, making sure that each of themreceives a fair statutory and compensationexclusively based on merit and expertise,without discrimination of any kind.The functions responsible for managingpeople must:- adopt in any situation criteria of merit and

ability (and anyhow strictly professional) inall decisions concerning human resources;

- select, hire, train, compensate and managehuman resources without discrimination ofany kind;

- create a working environment wherepersonal characteristics or beliefs do notgive rise to discrimination and which allowsthe serenity of all Saipem’s people.

More specifically, the Group’s compensationpolicy is based on the principle of equality ofmerit and the local approach. In fact, Saipemdefines its policies in full accordance with theskills and performance assessment andidentifies compensation strategies through alocal approach that intercepts the specificnature of the labour market and the locallabour law context.Saipem is also committed to promotingprogrammes to guarantee generationalturnover, aiming to ensure businesscontinuity, ensure critical skills and promotechange. These initiatives on one hand providedevelopment opportunities for young peopleand, on the other, enhance the seniorresources and their know-how.Generational turnover will be achieved inSaipem by supporting the motivation of themost expert resources to foster tutoring and

the transfer of knowledge, as well as creatingthe organisational and managerial conditionsto allow young people to obtain fullempowerment.Saipem provides its employees with differentbenefits and methods of allocating these,in accordance with local conditions.These include: complementary pension plans,supplementary healthcare funds, mobilitysupport services and policy, welfare initiativesand family support policies, catering andtraining courses aimed at ensuring moreeffective integration within the social-culturalcontext in question. These benefits, whenenvisaged and based on thecountry/society/local legislation in force,today are applied to the whole specificreference population regardless of the type ofcontract (temporary/permanent), except forthose particular services where the time scaleof performance delivery may not becompatible with the duration of the contract.The protection of specific groups ofemployees is safeguarded through theapplication of local laws, and is reinforced byspecific corporate policies that emphasise theimportance of this issue. The goal is to ensureequal opportunities for all types of worker inan effort to deter the onset of prejudice,harassment and discrimination of any kind(e.g. related to sexual orientation, colour,nationality, ethnicity, culture, religion, age anddisability) in full respect of human rights.In various business operations and incompliance with specific, local legislation,Saipem guarantees the inclusion of disabledor young personnel and compliance withpre-established ratios between local andexpatriate personnel.As regards gender diversity, thepercentage of women who hold amanagerial position compared to the totalnumber of women rose from 18% in 2017 to19% in 2018 (compared to the Groupconsolidated perimeter). Saipem isequipped with precise guidelines tostandardise pay policies and reduce the paygap between men and women in all the localbases where it operates. The Companydefines the compensation policyguidelines annually. In particular, Saipemconstantly strives to affirm the ‘equal pay forequal work’ principle and reduce the pay gapbetween men and women, in all operatingsituations, even if, on a global level, the resultof the gender pay gap indicator is alsoinfluenced by the specific manpowerdynamics of the year. The indicator reaches82% for the Senior Manager category (bothfor the Group consolidated and Group totalperimeter); as for Middle Managers, the 2018indicator records a value of 87% (86% for theGroup total perimeter) and with regard to theWhite Collars a value of 89% is reached (86%for the Group total perimeter). The Blue Collarcategory experienced a significant positive

Gender pay gap(%)

0

20

40

60

80

100

8687 8682 82

89

Grouptotal

Groupconsolidated

Grouptotal

Groupconsolidated

Grouptotal

Groupconsolidated

White collars

Middle managers

Senior managers

The gender pay gap indicator is calculated as the ratio between the average salary of a woman compared to the average salary of a man by category.



93

variation, motivated also by the fact that thefemale population in this category (59 BlueCollar women for the Group consolidatedperimeter and 85 for the Group total) is mainlyemployed in countries with higher wages thanaverage.Saipem supports the work/family balance ofits personnel through company regulationsand/or local policies which guaranteeparental leave. These leaves differ only in thetime and method of abstaining from work.The growth in the average number of days ofleave taken even if there was an overallreduction in the number of beneficiaries isclear. In 2018, Saipem had 919 employees(947 if we refer to the Group total perimeter),423 men (437 considering the Group totalperimeter) and 496 women (510 consideringthe Group total perimeter), who made use ofparental leave for a total of more than 43,000days (45,000 referring to the Group totalperimeter); at the same time, one should notethe return to work from parental leave of 703employees (727 at Group total level), 385 men(399 at Group total level) and 318 women (328at Group total level), with a return rate fromparental leave of 76% (77% at Group totallevel), a slight decrease against theprevious year.

Innovation in people management

In April, Saipem launched the ‘Flexability’Smart Working Programme.The Programme has identified four specificareas of action (HR practice, digital culture,

technology, work spaces) through which it ispossible to establish an improvement pathof the work organisation model thatpasses through a cultural, technologicaland digital change which can positivelycontribute to the achievement of companyresults through increases in efficiency andeffectiveness.Work teams were created for each area ofaction that have committed resourcesbelonging to all the main Saipem professionalareas/families. In order to meet the specificoperational and organisational needs of theDivisions, ad hoc solutions have beenidentified for each of them, so that the workteams can focus on the specific needs ofeach business area.The Programme, divided into the specificfields of action, was launched with anexperimental phase applied to a pilot group ofworkers in Italy and France, with the aim ofextending the perimeter of the resources andof the countries involved in the course of2019.In order to adapt quickly to these culturalchanges, initiatives aimed atdematerialisation and digitisation areongoing. In this sense, Saipem continues in itscommitment to creating Talent Acquisitionand Talent Management processes. In thesecond half of 2018, the Millennial Generationwas analysed with the aim of betterunderstanding the approach to the labourmarket of these emerging generations thatare expected to represent more than 40% ofthe workforce in 2020. Through this study itwas possible to design a set-up of new

2016 2017 2018

Group Group Group Group Group Group(No.) total consolidated total consolidated total consolidated

Women in the workforce

Women employed, by geographical area: 4,251 4,010 3,790 3,560 3,644 3,458

Americas 495 485 348 348 350 350

CIS 478 462 461 442 420 419

Europe 2,198 2,100 2,101 1,983 1,998 1,902

Middle East 129 123 120 115 154 152

North Africa 30 30 33 33 35 35

Sub-Saharan Africa 250 249 312 224 307 220

Far East 560 560 415 415 380 380

Women in leadership

Women Senior Managers 23 23 23 23 23 23

Women Managers 600 591 612 606 643 633

Age ranges

Employees under 30 years 5,809 4,225 4,330 3,724 3,740 3,526

of which women 735 540 494 427 439 399

Employees between 30 and 50 years 28,418 26,353 25,673 22,919 24,295 22,467

of which women 2,961 2,876 2,744 2,601 2,646 2,522

Employees over 50 years 6,078 6,281 5,915 5,415 6,094 5,700

of which women 555 594 552 532 559 537

Multiculturalism

Number of nationalities represented in the employee population 120 115 115 115 123 122



94

processes (which will be launched in 2019)linked, on the one hand to the ability to attractnew candidates through innovative selectionmethods and, on the other, by the ability toretain resources by creating a workingenvironment that enhances flexibility and theuse of mobile technologies for training andperformance assessment processes.To complete these new policies aimed atmillennials, a more liberal use ofnon-monetary benefits that are increasingly indemand and sought after by the newgenerations will be promoted.As part of Saipem’s broader digitaltransformation programme, the HumanResources department has incorporated theneed to innovate systems and tools to supportthe main processes for managing anddeveloping human capital. With this in mind,efforts continued in the rationalisation of payrollproviders at a global level, with the aim ofstandardising the service level and making datamore easily available and usable centrally forconsolidation and reporting purposes. A studyand analysis project was also launched in Italyin order to further strengthen the ability tocontrol and report the main management andadministrative indicators, as well as to increasethe operability in terms of service to users.Furthermore, the initiative to develop andimprove a system of KPIs and metrics on HRprocesses continued in order to monitor theefficiency and effectiveness of the pertinentprocesses and to guarantee a more preciselevel of control both at a central and divisionallevel; the monitoring and control system istherefore a periodic reporting system able toensure the definition of improvement plans inthe management of the ‘employer life-cycle’.

Health

As described in ‘The integrity in ouroperations’ Policy, Saipem considers thesafeguard of health and the promotion ofthe physical and mental well-being of itspeople as a fundamental requirement.This is a fundamental condition of the modusoperandi of Saipem which is committed tobeing leader in the safeguard of health, as wellas safety and the environment (further detailscan be found in the HSE Policy of SaipemSpA). The Company pursues this commitmentin compliance with the provisions on theprotection of privacy and the national andinternational laws on the safeguard of healthand the prevention of diseases.Its implementation implies that the healthpromotion programme, for each work site,concentrates mainly on preventive measuresand considers all the activities whoseperformance could represent a health risk.Activities implemented include, for example,an assessment of the health risks, check-upsfor the issue of fitness certificates,

vaccinations and chemoprophylaxis, healthinformation, monitoring of thehygiene/sanitary conditions, programmes forthe prevention of diseases and activities topromote health and physical activity.Saipem’s operating activities require themovement of a considerable number ofpeople, even to remote locations andcontexts, sometimes unknown to the workers.For this reason, the Company ensuresworkers the best possible medical assistancewherever they work, organises regular specificmedical examinations and consequentlyprepares medical fitness certificates, as wellas delivers training programmes to assignedpersonnel before undertaking any travel orbeing assigned abroad. This is to prevent risksof contracting diseases due to the effect ofthe climate, environmental and psychosocialfactors linked to the place of destination.The Company is equipped with structuredprocesses and a chain of well-definedresponsibilities to promptly manage anymedical emergency whatsoever.Saipem has developed a continually evolvinghealth management system, which is adaptedto the work environments, integrates the mostrecent epidemiological studies and isdesigned to ensure the best health monitoringand medical services.This system observes the principlesrecognised at international level and by locallaws, the WHO (World Health Organization)Beijing Declaration, ‘Global Strategy onOccupational Health for All’ (1994), Europeanlegislation and directive 2000/54/EC on theprotection of workers from risks related toexposure to biological agents at work, itsapplication in Italy through Legislative DecreeNo. 81/2008 and its amendments(‘Consolidated Law on occupational safety’ -‘Testo Unico in materia di salute e sicurezza sullavoro’). This approach ensures effectiveness,flexibility and an adequate basis for thedevelopment of a long-term health culture inall the countries where the Company operates.For each site/project/asset, themanagement system requires that the riskslinked to the health of personnel, areidentified and assessed (taking intoconsideration the frequency and potentialimpact), after which suitable preventive andmitigation measures are identified andimplemented. These measures areperiodically monitored.The general principles for the safeguard ofhealth are based on the analysis of theactivities carried out in the work environmentand take into consideration the risks thatthose activities have on both the peopleinvolved in the operations in different rolesand the local community.The analyses carried out are specific for eachduty and destination. They include theidentification of the activities and operatingconditions in relation to normal, abnormal and



95

emergency running conditions; the analysis ofthe possible contact routes for the risk agentsand their combined action and a clearassociation of the hazards to the duties in

relation to the specific nature of the identifiedactivities. The results of the analyses allow thepersonnel to be equipped with suitableequipment and appropriately monitored.

2016 2017 2018


Occupational diseases reported (No.) 9 9 5 4 7 7

Reported occupational diseases rate (ratio) 0.08 0.08 0.05 0.04 0.03 0.03

The reported occupational diseases rate is calculated as the number of occupational diseases reported divided by the hours worked by Saipem personnel, all multiplied by a million.

Occupational Health and MedicineIn 2018, the review and consolidationprocess regarding IT security on systemsmanaging health data was concluded incompliance with legislative requirementsprotecting physical persons and theprocessing of their data, as well as the freemovement of such data (EU Regulation2016/679 which entered into effect on May25, 2018 - GDPR).In the field of Occupational Medicine andHealth Surveillance, the process of reviewingthe protocols and certifications incompliance with the sector guidelines(OGUK and OGP IPIECA) was concluded.In the field of technological innovation anddevelopment, aimed at a more secure andefficient management of personal health data,the activity of implementation and deploymentof the ‘My Health Records’ programme, tothe Saipem Divisions continues, which allowsall Saipem worldwide staff under healthsupervision to be able to consult their healthdata. The purpose of digitalising the healthrecords via ‘My Health Records’ is toguarantee:- more rapid and direct communication

between employer, medical staff andemployee;

- immediate use and transferability of thedata;

- availability of a vast quantity of healthinformation in a single space;

- reduction of costs through datadematerialisation.

The pre-travel system is consolidated andfully operational and aimed at all Saipempersonnel destined to work abroad and isavailable on an e-learning basis, thanks to theTMS3 platform in line with the developmentsand updates of international health alerts.As an integral part of the Travel Medicineinformation process, the Saipem ‘SìViaggiare’ (‘Yes Travel’) application, iscontinuously managed and updated tostreamline the content modification processto provide faster, less expensive and,consequently, more frequent updates.Important scientific and technicaldevelopments have been planned for 2018and will include an initial application in 2019,such as:- the partnership with the Scientific Society of

Travel Medicine to update contents andshare the Best Practices;

- the agreement with the Apollo Hospital inChennai and the Port Harcourt/Nigeria basefor a pilot tele-radiology project.

During the year, the Health Surveillance andVaccinoprophylaxis activity, continued, alsoas part of the employee welfare initiativeswithin the company (vaccines and healthservices in partnership with public and privatehospitals and clinics). A project called‘Corporate Health News’ was launched tocollaborate on scientific communication withan important High Specialisation Polyclinic forthe disclosure of health care information/newsto Saipem SpA employees. For the fourth consecutive year, SaipemSpA has taken part in the WHP programme,(Workplace Health Promotion), andspecifically for 2018 for issues regarding‘Fighting Smoking’ No Smoking Building andsecond-hand smoke and road safety inassociation with ACI and INAIL.

Safety

The safety of all Saipem personnel is a priorityand strategic objective of the Company.This commitment is also clearly described inthe ‘HSE’ Policy of Saipem SpA and the‘Integrity in our operations’ Policy.The safety of people is constantly monitoredand guaranteed in the management of itsactivities through an integrated health, safetyand environment management system, whichmeets international standards and currentlegislation. In 2018, the OHSAS 18001 andISO 14001 certifications of Saipem SpAwere confirmed by a third-partycertification body through a periodic auditprocess. The coverage of thesecertifications were extended in 2017 to themost significant business entities in theGroup, guaranteeing a uniform and systematicapproach in the management of theprocesses.Saipem defines a safety objectives planevery year at corporate, division andoperating company level, which is approvedby the CEO, division manager and managingdirectors, respectively. The incentive plansfor the senior managers for the areas



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under their responsibility are linked to theachievement of these objectives. Further details can be found in the ‘2019Remuneration Report’.For the year 2019, these goals include:- the identification of the hazards and the

periodic assessment of the risks associatedwith the safety of personnel, vendors andother persons involved in the company’sactivities, as well as the risks for thecompany assets;

- guarantee appropriate assessment of therisks caused by the interference betweenthe activities subcontracted to the vendorsoperating on Saipem structures or sites;

- the training of personnel. The HSE trainingprocess can be broken down into severalphases: updating the HSE training protocol(which identifies the training needs basedon professional roles), definition andstandardisation of the courses on adedicated platform, provision of thecourses, monitoring and reporting on thetraining activities;

- adoption of adequate preventive andprotective measures to guarantee theintegrity and efficiency of the assets andthe health and safety of people;

- follow-up and control activities on theeffectiveness of the prevention and theprotective measures implemented;

- reporting, registration, analysis andinvestigation activities for accidents andnear misses;

- consolidation and analysis of safetyperformance.

The Company carries out internal auditsregarding HSE on: HSE management system,compliance with the HSE legislative provisionsand audits on the processes regarding safety;these audits, 181 in 2018, involved operatingcompanies, operational sites (including thefleet) and subcontractors.At Saipem, promoting a culture of workerhealth and safety is facilitated in thecompany’s industry by both the referenceregulatory framework, characterised by lawsand agreements at national and companylevel, and by an internal environmentcharacterised by specific policies on healthand safety.These policies set particularly stringentcriteria compared to the local contexts, whichtoday still have regulatory systems in theprocess of development. Not all countries inwhich Saipem operates have trade unions atboth national and local levels.Where specific agreements are in place withtrade unions, they can including the followingon safety:- setting up workers’ safety committees

(composition and number);- specific training for safety officers

(responsible company figures andemployee representatives) and grassrootsinformation on safety matters to all

employees, with particular reference tocourses on Health and Safety at Work, FireFighting, First Aid, and mandatory ‘SpecialOperations’ (Onshore-Offshore);

- regular meetings between the company andworkers’ representatives.

In Italy, the collective agreement (CCNL)provides for the appointment of corporaterepresentatives of the workers for theirprotection in the areas of health, safety andenvironment (RLSA). The appointment is byelection, based on the provisions of law andthe bargaining agreement. There are a total of19 RLSA at the Saipem Italian offices.A specific trade union agreement signed bySaipem and the Trade Union Organisations(OO.SS) defines the duties of the RLSA andtheir full authority to carry out their activitiesalso for workers assigned temporarily toactivities at yards and work-sites other thanthose of origin.It should also be noted that abroad there areinstitutes where participation is sharedbetween management and the workforce forthe management of initiatives andprogrammes regarding health and safety inaccordance with the reference regulations indifferent national situations. Among these arethe Saipem Group entities operating inAlgeria, Angola, Bolivia, Brazil, Canada,Colombia, Congo, Croatia, Ecuador, France,Indonesia, Malaysia, Mexico, Norway, Peru,United Kingdom, Romania and Venezuela.The Company has launched severalawareness campaigns over the years with thepurpose of spreading a deeper and moreentrenched safety culture. The Leadership inHealth and Safety (LiHS) programmestands out among these. Its purpose is topromote the development of leadershipabilities and cultural change regardingsafety. The programme, which reached itseleventh year of implementation in 2018, aimsto spread safe behaviour, focusing on thedevelopment of leadership at all levels.During the years 2017 and 2018, specialworkshops were organised, with the TopManagement and the Business Divisions, tofurther reinforce the LiHS programmemessages, create an opportunity for dialogueon leadership and safety issues and build thenew Health & Safety Vision, the document thatreflects the corporate values and long-termobjectives to be achieved in terms ofcompany Safety Culture.Among the main activities carried out duringthe year by the LHS Foundation, a foundationcreated by Saipem to spread a new culture ofhealth and safety in the professional worldand to make the expertise gained by theCompany available to the industry and thesociety, the following are of note:- ‘Italy Loves Safety’, a social experiment

that groups hundreds of SafetyAmbassadors, including entrepreneurs,professionals, trainers, educators, students

SAFETY INDICATORS: DEFINITIONSAND CALCULATION METHODS

LTI (Lost Time Injury): means anywork-related injury that renders the

person temporarily unable to perform anyregular activity or restricted work during

any day/shift after the day on which theaccident occurred. The LTI include fatal

accidents, permanent total disability,permanent partial disability and temporary

total disability.WRC (Work Restricted Case): term to

define any injury at work, with theexception of fatalities or lost days, whichmakes the person unfit for performing all

his/her activities fully in the days after theinjury at work. In this case, the injured

person is temporarily assigned to otherduties or exempted from some parts of

his/her normal duties. The maximumlimitation time can be 30 days. If the

limitation exceeds 30 days, the injury mustbe classified as LTI.

MTC (Medical Treatment Case): term todefine any injury at work (infected wounds,

stitches, deep presence of foreign bodiesin the eyes, etc.) which does not entail

either lost work days or restricted workdays, but requires recurring treatment by

the doctor or in accordance with hisspecific indication or which could be

considered a case that falls within thescope of a doctor’s expertise.

TRI (Total Recordable Incidents): meansthe sum of LTI, cases of limited work and

cases of medical treatment:TRI = LTI+WRC+MTC.

TRIFR (Total Recordable IncidentFrequency Rate): it is calculated as (TRI

number on hours worked) x 1,000,000.FTLFR (Fatal Accident Frequency Rate):

calculated as (number of fatal accidentsper hour worked) x 100,000,000.LTIFR (LTI Frequency Rate): it is

calculated as (No. LTI on hours worked)x 1,000,000.

Lost days of work: the total number ofcalendar days in which the injured personwas not able to do their job as a result of

an LTI. The calculation for the lost daysstarts from the second day after an

accident until the day when the person iscapable of returning to work.

The calculation does not include fatalaccidents.

SR (Severity Rate): it is calculated as (No.of days of work lost

on hours worked) x 1,000.High-consequence work-related injury:

injury with more than 180 days lost.High-consequence work-related injuriesFrequency Rate: it is calculated as (No. of

accidents with a high impact on workhours) x 1,000,000.

Absenteeism rate of employees: it iscalculated as the ratio between the

number of total hours of absence and thenumber of total annual theoretical working

hours. The theoretical annual hours ofwork are calculated proportionately to the

number of staff at December 31.



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and ordinary citizens who believe in theneed to revolutionise the way of promotingsafety since 2015. In the first three years ofthe ‘Italy Loves Safety’ movement, theambassadors carried out more than1,000 free and safety-related eventsthroughout Italy;

- ‘Growing New Leaders in Safety’, atraining programme consisting of severalworkshops for children and youths from 3to 18 years of age. An activity is developedfor each target audience that is adequate tothe cognitive and learning abilities of theyoungsters, which can, through play,

2016 2017 2018


Man-hours worked

Total, of which: (millions of hours) 258.6 222.5 281.9 220.8 272.5 268.4

Man-hours employees (millions of hours) 93.3 89.9

Man-hours subcontractors (millions of hours) 179.1 178.5

Accidents with days lost (LTI)

Total, of which: (No.) 52 (*) 41 (*) 40 (*) 37 (*) 36 36

Employees (No.) 17 17

Subcontractors (No.) 19 19

Of which fatal accidents: (No.)

Total, of which: (No.) 1 1 3 3 4 4

Employees (No.) - -


High-consequence work-related injuries

Total, of which: (No.) 1 1

Employees (No.) 1 1

Subcontractors (No.) - -

Days lost

Total, of which: (No.) 3,106 1,705 1,857 1,380 1,280 1,280



Severity Rate

Total, of which: (ratio) 0.01 0.01 0.01 0.01 0.005 0.005

Employees (ratio) 0.006 0.006

Subcontractors (ratio) 0.004 0.004

Total Recordable Incidents (TRI)

Total, of which: (No.) 201 139 144 113 120 118



Employee absentee rate (**) (%) 4.9 4.2 4.1 4.7 4.0 3.9

Fatal Accident Frequency Rate (FTLFR)


Employees (ratio) - -


Lost Time Injuries Frequency Rate (LTIFR)




High-consequence work-related injuries Frequency Rate

Total, of which: (ratio) 0.004 0.004


Subcontractors (ratio) - -

Total Recordable Incidents Frequency Rate (TRIFR)




(*) It should be noted that starting 2018, after updating the reporting methodology, fatal accidents are included in the representation of LTIs for all reported years.(**) Group consolidated perimeter includes all companies fully consolidated with the exclusion of North Caspian Service Co, Saipem Australia Ltd, Saipem East Africa Ltd, Saipem Ingenieria yConstrucciones SLU, Saipem Misr for Petroleum Services (S.A.E.). Group perimeter includes all the companies included in the abovementioned perimeter and Petromar Lda, SaiPar Drilling Co BVand TSGI Mühendislik I·nsaat Ltd Sirketi.



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reading, watching films and theatricalperformances, stimulate them on the themeof health and safety, promoting morecorrect and positive behaviours forthemselves and for others. Each of the sixeducational courses relies on thecollaboration of professionals and the worldof childhood education such as Muba,Museo del Bambino of Milan or theemergency management sector such asthe Italian Red Cross. In 2018, the projectinvolved 3,335 students and teachers.

Unfortunately, 4 fatal accidents occurred in2018 involving subcontractor personnel inTurkey, Kazakhstan and Saudi Arabia, at twodifferent sites. Although outside the reportingscope of Saipem (it occurred outside workhours), it is considered important to mention alarge road accident which occurred during thetransport of personnel involving the vehicle ofa subcontractor with 12 passengers.The event occurred near a site operating inSaudi Arabia and caused the death of 4people and injury to others. It was establishedthat all persons transported who wore seatbelts correctly at the time of the accidentwere not injured.The fatal accidents that occurred duringoperational activities are related to a fall, acollision with a moving vehicle, a roadaccident and the dismantling of a cratecontaining a valve. In-depth investigationshave been carried out to identify the causesof these accidents and appropriate actionshave been implemented in order to minimisethe possibility of recurrence.During the year, Saipem continued to investsignificant resources in training its staff onHSE issues through campaigns and ad hocprogrammes, in order to increase workers’awareness of the risks associated with workactivities.While not diminishing the importance andunacceptability of the events described, it isworth noting the positive trend of the mainoverall safety indicators (TRI - TotalRecordable Incidents and LTI - Lost TimeInjury). TRI Frequency Rate (TRIFR) and LTIFrequency Rate (LTIFR) decreased by 14%(for both perimeters) and by 7% respectivelyfor the Group total perimeter (24% for theGroup consolidated perimeter) compared tothe previous year.The main critical issues identified by theanalysis of the incidents occurred areconfirmed, with regard to occupational risks,as ‘falls from heights’ and accidents related tomanual handling and manual operations.Although the incidents related to ‘fallingobjects’ have decreased significantly, mainlydue to the implementation of the specificDROPS campaign (Dropped ObjectsCampaign), they continue to represent animportant source of potential accidents.Road accidents and commuting accidents areissues of increasing attention.

The performance indicators for the yearconfirm the importance of a widespreadimplementation of all the programmes andcampaigns carried out by the Company on allsites, and with the maximum commitment.

Asset integrity

Saipem strongly pursues the effectiveimplementation of its asset integritymanagement system as an outcome of gooddesign, construction and operating practicesadopting the integrated management ofbarriers to reduce the risks associated withMajor Accident Events (MAE).Asset integrity refers to the prevention andcontrol of the events with low frequency andhigh/severe consequences on people, theenvironment, assets or project performance.A dedicated team has been set up to developan asset integrity management system modelin line with the best Industrial practices.The asset integrity model follows a typicalDeming cycle: planning, operations,performance monitoring and continualimprovement.Saipem undertakes to prevent risks toimprove the integrity of its operations. For thispurpose, it adopts a proactive approach in themitigation of risks as an integral part of itsmanagement and business activities.Further information is available in the‘Sustainable Saipem 2018’ section ‘Safety forour assets’.

Fighting corruption

Saipem has always conducted its businesswith openness, fairness, transparency,integrity and in full observance of laws andregulations. In this context, corruption is anintolerable impediment to the efficiency ofbusiness and to fair competition.Amongst its various initiatives, Saipem hasdesigned an ‘Anti-corruption ComplianceProgramme’, a detailed system of rules andcontrols aimed at preventing corruption in linewith best international practices and theprinciple of ‘zero tolerance’ expressed in theCode of Ethics.In particular, the Saipem Code of Ethics(including Model 231) establishes that ‘bribes,illegitimate favours, collusion, requests forpersonal or career benefits for oneself orothers, either directly or through third parties,are prohibited without any exception’.The Saipem ‘Anti-corruption ComplianceProgramme’ is characterised by its dynamismand constant attention to the evolvingnational and international regulatoryframework and best practices.Over the years, and in view of continuousimprovement, the ‘Anti-corruptionCompliance Programme’ has been constantly



99

updated in line with the applicable provisionsin force (including, inter alia, the UnitedNations Convention Against Corruption, theOrganisation for Economic Cooperation andDevelopment Convention on CombatingBribery of Foreign Public Officials inInternational Business Transactions, ItalianLegislative Decree No. 231 of June 8, 2001,the US Foreign Corrupt Practices Act and theUK Bribery Act and Sapin 2 Law).More specifically, the Board of Directors ofSaipem SpA approved the ‘Anti-CorruptionManagement System Guideline’(Anti-Corruption MSG) on April 23, 2012.This repealed and replaced the previousAnti-Corruption Compliance Guidelines inorder to optimise the compliance system inforce. All the detailed anti-corruptionprocedures for specific risk areas were thenupdated (inter alia, the procedures for jointventure agreements, sponsorship, gifts,non-profit initiatives, vendors and consultants,relations with public administration andmerger & acquisition operations).Subsequently, Saipem SpA issued the latestrevision of the ‘Anti-Corruption managementSystem Guideline’ in 2015. This representedan improvement in the regulatory context ofthe ‘Anti-corruption Compliance Programme’and the Saipem Corporate Governancesystems regarding anti-corruption.The above-mentioned MSG was examinedand approved by the Board of Directors ofSaipem SpA. Its adoption and enforcement ismandatory for Saipem SpA and all itssubsidiaries.All Saipem people are responsible forcomplying with the anti-corruptionregulations: all the documents are accessibleto them through the website and thecompany intranet portal. In this context, themanagers hold a role of primary importanceand they are called upon to promotecompliance with the anti-corruptionprocedures by their colleagues.Furthermore, Saipem was one of the firstItalian companies to achieve the internationalcertificate ISO 37001:2016 ‘Anti-corruptionmanagement systems’. This certification,awarded by an independent accredited body,identifies a management standard that helpsorganisations in the fight against corruption,establishing a culture of integrity,transparency and compliance.The certification process, which included anaudit phase that began in January 2018 andended in April 2018, took into considerationsuch factors as the organisational structure,local presence, processes and services.Aware that the primary element for developingan effective strategy to combat thephenomenon of corruption lies in developinga thorough understanding of the tools for itsprevention, Saipem regards these traininginitiatives and awareness activitiesconsiderably important. In 2018, there was an

annual increase in training hours provided inthis area above 71% for both perimeters.Moreover, the Internal Audit function ofSaipem shall independently review and assessthe internal controls in order to verifycompliance with the requirements of the MSG‘Anti-Corruption’, based on its own annualaudit programme approved by the Board ofDirectors of Saipem SpA.Any violation, suspected or known, ofanti-corruption laws or anti-corruptionprocedures must be immediately reportedthrough the channels indicated in the‘Whistleblowing reports received by Saipemand by its subsidiaries’ procedure, which isavailable on the Company website and theintranet portal. Disciplinary measures areprovided for people in Saipem who violate theanti-corruption regulations and omit to reportviolations that they are aware of.Saipem expects all of its Business Partners tocomply with all applicable laws, includinganti-corruption laws, in connection withSaipem’s business, and to undertake tocomply with the reference principles of theAnti-Corruption MSG.

Human rights

Saipem is committed to protecting andpromoting human and labour rights whenconducting its business, taking intoconsideration both the work standardsrecognised at international level and the locallegislation in the countries where Groupcompanies operate. This commitment is partof Saipem’s modus operandi and is also madeclear in the ‘Our People’ Policy.With reference to the management of relationswith personnel worldwide, Saipem adheres tothe principles of the UN Universal

Compliance training(number)

0

2,000

4,000

6,000

8,000

10,000

12,000

Group

total

Group

consolidated

Group

total

Group

consolidated

Group

total

Group

consolidated

Hours of training on issues of compliance, governance, ethics and anti-corruption

Employeestrained on issues of compliance, governance, ethics and anti-corruption

2016 2017 2018

2,813

10,59310,597

6,1786,2016,6646,713

4,3174,318

1,9541,962

2,802



100

Declaration of Human Rights and the OECDGuidelines for Multinational Companies.Furthermore, the Chief Executive Officer ofSaipem has formally committed to promotingand respecting the principles set out in theUnited Nations Global Compact, to whichSaipem adheres, including principles 1, 2, 3, 4,5 and 6 (regarding the rights of workers andthe promotion of socio-economicdevelopment of the territories).In protecting and promoting the rights ofworkers, due attention is paid to theconventions of the International LabourOrganisation (ILO) regarding protectionagainst forced labour and child labour, thefight against discrimination in employmentand the workplace, freedom of associationand collective bargaining.With specific reference to the latter, Saipemhas a sound record of relations with tradeunion organisations in a variety of geographiclocations and covering several segments ofits business. Further details can be found inthe ‘Industrial relations’ section hereto.Saipem promotes and encourages a constantopen dialogue between employer andemployees so that the interests of the partiescan be best realised in consideration of thefact that a regular and effectivecommunication flow between the two partiesappreciably reduces the probability ofmisunderstandings and conflict arising at theworkplace.Therefore, Saipem takes steps to ensure thatthere is a widespread and shared systembetween all the workers in Italy and around theworld, which permits an easy and effectiveresolution of any conflicts linked to issues thathave implications of an administrative nature.It is for this purpose that a procedural tool hasbeen drawn up. It defines the methods forresolving conflicts, the timeframe, the peopleinvolved in the process and knowledge of theoutcomes for the workers.Saipem’s attention to labour rights extendsalso to offshore personnel with full abidanceto the principles and the rights recognised toSeafarers promoted under the ILO MaritimeLabour Convention of 2006 (MLC 2006).Seafarers also have the right to submit agrievance following a structured process if aviolation of their rights arises.In order to guarantee that each person is

aware of their rights, all people working onoffshore vessels receive a copy of the relatedprocedure and all the forms necessary for thecomplaint, together with a copy of theiremployment agreement. The captain and/orthe Company examines any complaint, andany instance of harassment is managed incompliance with the Company’s disciplinaryprocedures.Finally, based on commitments made by theGroup in the context of the Global Compact,Saipem has completed a human rightstraining and awareness programme for HRpersonnel and company and branchmanagers operating in 20 countries.The initiative has reached 85% of thepersonnel initially selected. At the same time,a similar initiative was targeted atsubcontractors to seek a shared and moreeffective approach to promoting andrespecting human rights.

Security practices

In the management of security, Saipem givesutmost importance to respecting humanrights. Saipem is committed to adoptingpreventive measures aimed at minimising theneed for response by public/private securityforces in the case of any threats to the safetyof its people and the integrity of its assets.The Company manages relations with localsecurity forces in order to ensure a sharedcommitment to human rights, as well as theadoption of rules of engagement that limit theuse of force.Before signing a contract, vendors ofsecurity goods or services are subjectedto due diligence, to verify that there are nocounter-indications connected with theviolation of human rights.Saipem has introduced clauses regardingthe respect for human rights, lin itscontracts with these vendors since 2010, andfailure to observe them leads to thewithdrawal of the Company from the contract.Until now, the contractual clauses on humanrights have been included in the ‘Generalterms and conditions’.Further information can be found in the‘Human and labour rights’ section of‘Sustainable Saipem 2018’.

Hum

an a

nd la

bour

rig

hts

Sec

urit

y pr

acti

ces Human rights

violations by securityservice providers incritical geographicareas or developing countries.

Saipem periodically carries out checks on the reliability of security services, especially during thequalification and selection phase of the relevant providers. Furthermore, the inclusion of clausesconcerning the protection of human rights is envisaged in the contracts. Finally, Saipem organisesspecific training courses for personnel (both internal and external) engaged in security services.

Sai

pem

mat

eria

l top

ic

Risks identified by the Company Summary of the adopted risk mitigation measures

RISKS CONCERNING ISSUES COVERED BY ITALIAN LEGISLATIVE DECREE 254/2016: HUMAN RIGHTS



101

For new projects in which Saipem isresponsible for security, the Company carriesout a Security Risk Assessment on thecountry in question before initiating a tenderprocess. If it decides to go ahead with issuinga call for bids, Saipem prepares the ProjectSecurity Execution Plan in which thesecurity risk connected with the operatingactivities and the context is analysed,including human rights violation issues. Theactions required to manage and reducethese to a minimum are decided upon basedon the risks identified.Additionally, the security risk factors of theoperating environment are the subject ofspecific assessment by the Employer(Responsible for the Observance on healthand safety) in Saipem SpA and in thesubsidiaries. The level of exposure to theserisks depends on hygienic-environmental,socio-political factors connected to thephenomena of crimes and terrorism, andcultural, in a variable percentage dependingon the country in which one operates.The Security Risk Assessment (VRS) is thedocument that identifies the security riskspertaining to each organisationalstructure/permanent site of an operatingcompany or subsidiary and which defines themain mitigation actions to be undertaken.The census of all operating sites bothonshore and offshore (GST) and Saipememployees (and contractors) present on thevarious operating sites/management offices,both onshore (POS) and offshore (POB), isconstantly updated. As security riskprevention measures, the Company adoptsspecific measures such as:- implementation of Meet & Greet procedures

in the destination country;- local ‘security induction’ for expatriated

personnel on arrival at the destination, withindications of local threats, conduct to befollowed and precautions to be taken dailyin the specific work site/country;

- assignment of a security escort, with use ofarmoured vehicles, where necessary, basedon local security conditions.

The implementation of security plans and theprovision of evacuation plans are tools usedat all Company operational sites/offices.The synergy of different companydepartments also allows them to implementLocal Crisis Units for the management ofemergencies and crises.The corporate departments also work inoperational coordination with Embassies,Consulates, Ministry of Foreign Affairs (MAE) -Crisis Unit, Client and Third Party Security (JV).Consistently and in compliance withLegislative Decree No. 81/2008 ‘ConsolidatedLaw on occupational safety’, the TimeManagement System (TMS) computersoftware was prepared by the Group Healthand Security department to manage missionsfrom their booking/authorisation and track

staff on short trips or assignments abroad.The system made available to resourcestravelling for business, secondment or workshift rotations between Italy and a foreigncountry aims to provide Pre-travellinginduction accompanied by a series ofinformation on the Security and Healthaspects specific to the destination country, aswell as to guarantee tracking of workerstravelling abroad.

Reporting suspected violations

A fundamental part of Saipem’s structuredsystem for managing stakeholder complaintsis the reporting management process(‘whistleblowing’) governed by a specialCorporate Standard made available to allemployees (through various means, amongwhich the intranet and company noticeboards) and external stakeholders (publishedon the Company’s website).The term ‘report’ refers to any information,notice, fact or behaviour that has in any waycome to the attention of Saipem personnelregarding possible violations, behaviour andpractices that do not conform to theprovisions in the Code of Ethics and/or whichmay cause damage or injury to Saipem SpA(even if only to its image) or any of itssubsidiaries, referring to employees, directors,officers, audit companies of Saipem SpA andits subsidiaries and third parties in a businessrelationship with these companies, in one ormore of the following areas: the internalcontrol system, accounting, internalaccounting controls, auditing, fraud,administrative responsibilities underLegislative Decree No. 231/2001, and others(such as violations of the Code of Ethics,mobbing, security, etc.). Saipem has preparedvarious channels of communication in orderto facilitate the sending of reports, including,but not necessarily limited to, regular post, faxnumbers, yellow boxes, e-mail, andcommunication tools on the intranet/internetsites of Saipem SpA and its subsidiaries.The Internal Audit function ensures that allappropriate controls are in place for any factsthat have been reported, guaranteeing that:(i) these are carried out in the shortest timepossible and respecting the completenessand accuracy of the investigation; (ii) theutmost confidentiality with methods suitablefor protecting the person reporting.The inspection comprises the followingstages: (a) preliminary check; (b) assessment;(c) audit; (d) monitoring of corrective actions.The Internal Audit prepares a quarterly reporton reports received that, followingexamination by the Saipem Board of StatutoryAuditors, is sent to the relevant people forsuitable assessment.



102

Details of some categories of file are providedbelow:

The following were opened in 2018: 13 casesreporting discrimination issues, of which 6 arestill open and 7 closed, 49 cases reportingworker’s rights issues, of which 22 still openand the remaining 27 closed, 2 casesreporting local community issues, bothclosed during the year. All 64 cases weretransmitted to the pertinent company bodies(Board of Auditors of Saipem SpA,Supervisory Board of Saipem SpA and theCompliance Committees of the companiesaffected by the reports).With regard to the issues of discrimination,with reference to the closed cases, thepertinent company bodies decided to close 6on the basis of investigations carried out,considering that there were no violations ofthe Code of Ethics with reference to the factsreported. In 1 case, albeit without violations, acorrective action consisting of monitoring thereported individuals’ behaviour, was identified.The relevant disciplinary measures are appliedin the event of breach of the Code of Ethics.It should also be noted that 6 discriminationcases reported in 2017 were closed in 2018;they were still open at the time of the lastreporting. Of the 6 cases closed, 4 wereunfounded and 2 were founded. With regardto these latest cases, corrective actions werecarried out on the perpetrators of thebehaviour, which consisted of a warning letterand awareness training on company

procedures and policies, as well as on theGroup’s Code of Ethics and, for 1 case, thepertinent Compliance Committee will conductanother anonymous survey sessions toidentify any further improvements.With regard to the issues of workers’ rights,with reference to the 27 closed cases, in 19cases the competent company bodiesdecided upon closure deeming that therewere no cases of violation of the Code ofEthics with reference to the facts reported,whilst violation was confirmed in 3 cases and5 cases, though without violation, correctiveaction was taken. The actions were thefollowing: a warning letter issued to theperpetrator; a verbal warning an awarenesstraining with reference to the maintenance ofa behaviour consistent with the positions held;actions to raise awareness of compliance withthe Code of Ethics; awareness promotionactivities in order to reiterate the importanceof respecting working hours; organisation of ameeting in order to improve the managementof work-related stress and the maintenance ofan acceptable style communication;verification of the activation of specificsecurity regulations to ensure the safety ofthe employees involved in the report; carryingout, on a periodic basis, soft skills training;organisation of coordination meetingsbetween the various departments andevaluation of the opportunities to carry out

(No.) 2016 2017 2018

Files on cases of discrimination

Total, of which: 19 12 13

- founded or partially founded 2 4 -

- unfounded 17 8 7

- open - - 6

Files in relation to workers’ rights


- founded or partially founded 6 3 3

- unfounded 24 21 24

- open - 2 22

Files regarding violations of the rights of local communities


- founded or partially founded - - -

- unfounded 2 3 2

- open - - -

The data is update as of December 31, 2018.

(No.) 2016 (*) 2017 2018

Number of cases reported


- founded or partially founded 31 24 17

- unfounded 98 92 64

- open - 2 39

(*) The count for closed cases includes 4 closed cases concerning the system of internal controls and risk management and re-opened and closed also for other matters concerned.



103

organisational changes. Finally, for 1 case thepertinent Compliance Committee will conducta new anonymous survey session in order toidentify any further improvements. It shouldalso be noted that 13 workers’ rights caseswere closed in 2018 (12 from 2017 and 1from 2016); they were still open at the time ofthe last reporting. Of the 13 cases closed, 12were unfounded and for one case, despite theabsence of violations, a corrective action wasidentified consisting in sending a letter to thevendor in order to sensitize its employees torespect of the Code of Ethics.As regards issues on the relations with localcommunities, with reference to the 2 closedcases, the competent company bodiesdecided to dismiss them on the basis of theinvestigations carried out that deemed thatthere was no violation of the Code of Ethicswith reference to the facts reported.No corrective actions were implemented.Furthermore, 1 case dealing with issuesregarding the local communities from 2017was closed in 2018. This case was unfounded

and no corrective action was identified withregard to this outcome.

Limited assurance

Reporting is subject to limited assurance byan independent company (hereinafter ‘theauditor’), the auditor of the annual report.The auditor certifies, in the context of thestatutory audit, that the ‘ConsolidatedNon-Financial Statement’ have beenapproved by the Board of Directors.The auditor also expresses, with anappropriate report, the certification that,based on the work carried out, no elementsarose to indicate that ‘ConsolidatedNon-Financial Statement’ were not prepared,in all significant aspects, in compliance withthe provisions of Articles 3 and 4 of ItalianLegislative Decree No. 254/2016 and the GRIStandards. The Saipem SpA Board ofDirectors approved the ‘ConsolidatedNon-Financial Statement’ on March 11, 2019.



104

GRI content index

In accordance with GRI standards - Core option

Legend of the documentsNFS18: Consolidated Non-Financial StatementAR18: Annual Report 2018CG18: Corporate Governance and Shareholding Structure Report 2018

GRI 102: GENERAL DISCLOSURE 2016

Disclosure Section name and page number or link

102-1102-2102-3102-4102-5102-6102-7

102-8

102-9102-10102-11102-12102-13

102-14

102-16

102-18

102-40102-41102-42102-43102-44

102-45102-46102-47102-48102-49102-50102-51102-52102-53102-54102-55102-56

Cover (AR18).‘Directors’ Report’, pages 15-29 (AR18).Back cover (AR18).Inside front cover (AR18).Table ‘Shareholding structure’, page 63 (CG18).‘Directors’ Report’, pages 12-14 (AR18).‘Saipem people’, pages 86-98 (NFS18); ‘Letter to the Shareholders’, pages 2-4 (AR18); ‘Financial andeconomic results’, pages 32-37 (AR18).‘Saipem people’, pages 86-98 (NFS18). Please note that employees on permanent contract (with a keyprofessional role) number 13,468 (14,123 for the Group perimeter), of which 1,150 women (1,189 for theGroup perimeter). The geographic distribution of this staff is the following: 725 in the Americas (for bothperimeters), 1,607 in the Far East (for both perimeters), 690 in CIS (for both perimeters), 405 in NorthAfrica (for both perimeters), 1,286 in Sub-Saharan Africa (1,512 for the Group perimeter), 3,584 in theMiddle East (3,751 for the Group perimeter) and 5,171 in Europe (5,433 for the Group perimeter).Employees who do not hold a key professional role can be defined as ‘temporary’ for the GRI definition.31,470 employees have a full-time employment contract (33,906 for the Group perimeter), of which3,290 are women (3,476 for the Group perimeter).‘Social aspect management activities and results’, pages 82-86 (NFS18).‘Social aspect management activities and results’, pages 82-86 (NFS18).‘Company management and organisation model’, pages 74-76 (NFS18).‘Fighting corruption’, pages 98-99 (NFS18); ‘Human rights’, pages 99-103 (NFS18).Saipem is an active member of 121 business associations at national and international level. The groupleader is a member of 47 associations, among which ANIMP, IADC, IMCA, IPLOCA, UN Global Compact,Valore D, WEF and WEC.

‘Letter to the Shareholders’, pages 2-4 (AR18).

‘Company management and organisation model’, pages 74-76 (NFS18); inside front cover (AR18).

‘Board of Directors’, pages 17-19 (CG18); ‘Board Committees’, pages 33-39 (CG18); ‘Structure of theBoard of Directors and its Committees’, page 64 (CG18).

‘Reporting methodologies, principles and criteria’, pages 71-74 (NFS18); ‘Company management andorganisation model’, pages 74-76 (NFS18); ‘Saipem people’, pages 86-98 (NFS18).

‘Scope of consolidation at December 31, 2018’, pages 142-146 (AR18).‘Reporting methodologies, principles and criteria’, pages 71-74 (NFS18); ‘Scope of consolidation atDecember 31, 2018’, pages 142-146 (AR18); ‘Changes in the scope of consolidation’, page 147 (AR18).

‘Consolidated Non-Financial Statement’ (NFS17), approved March 5, 2018.‘Reporting methodologies, principles and criteria’, pages 71-74 (NFS18).Inside back cover (AR18).‘Reporting methodologies, principles and criteria’, pages 71-74 (NFS18).‘GRI content index’, pages 104-107 (NFS18).‘Limited assurance’, page 103 (NFS18); ‘Independent Auditors’ Report’, pages 108-110 (NFS18).

Ethics and integrity

Stakeholder engagement

Reporting practice

Corporate Governance

Organisation profile

Strategy



105

MATERIAL THEMES

SpecificStandard

Section name and page number or link Notes/Omissions

GRI 202: Market Presence 2016

103-1103-2 and103-3202-2

103-1,103-2 and103-3205-3

103-1,103-2 and103-3302-1

103-1,103-2 and103-3305-1

305-2

103-1,103-2 and103-3306-3

103-1,103-2 and103-3401-2

103-1,103-2 and103-3

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Social aspect managementactivities and results’, page 84 (NFS18).‘Social aspect management activities and results’,page 84 (NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Fighting corruption’, pages98-99 (NFS18).‘Legal proceedings’, pages 177-188 (AR18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Environmental managementand results’, pages 76-78 (NFS18).‘Environmental management and results’, pages79-80 (NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Environmental managementand results’, pages 76-78 (NFS18).‘Environmental management and results’, page 80(NFS18).

‘Environmental management and results’, page 80(NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Environmental managementand results’, pages 76-78 (NFS18).‘Environmental management and results’, page 79(NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Saipem people’, pages87-88, 91-93 (NFS18).‘Saipem people’, pages 91-93 (NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Saipem people’, pages 90,94-98 (NFS18).

People classified as ‘local personnel’ are thoseemployees residing in the country in which they areemployed.

No employee was dismissed due to corruptioncases.

The total energy consumption in 2018 wasequivalent to 18,775.16 TJ (18,987.82 TJ for theGroup perimeter). The percentage of renewableelectricity produced and consumed by the Groupdepends on the energy mix of the different countries.

The source used to define the emission factors is‘IPCC Guidelines for National Greenhouse GasInventories 2006’.The sources used to define the emission factorsare the following: International comparisons(‘Confronti Internazionali’ - Terna) and GreenhouseGas Protocol. Scope 2 market-based emissionstotal 36.3 thousand tonnes of CO2 eq (38.2thousand tonnes of CO2 eq for the Group). Using aconservative approach, the value of scope 2market-based emissions has been calculated usingthe residual mix emission factors. The Company isplanning to start collecting information on origincertificates from renewable sources in order toprovide for next reporting cycle the real value ofemissions.

GRI 205: Anti-corruption 2016

GRI 302: Energy 2016

GRI 305: Emissions 2016

GRI 306: Effluents and Waste 2016

GRI 401: Employment 2016

GRI 403: Occupational Health and Safety 2018



106

MATERIAL THEMES

SpecificStandard


403-5

403-9

103-1,103-2 and103-3404-1

404-3

103-1,103-2 and103-3405-1

103-1,103-2 and103-3406-1

103-1,103-2 and103-3

407-1

‘Saipem people’, page 90 (NFS18).


‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Saipem people’, pages 90,89-90 (NFS18).‘Saipem people’, page 90 (NFS18).


‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Saipem people’, pages 90,91-93 (NFS18).‘Saipem people’, pages 91-93 (NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Saipem people’, pages 90,91-93 (NFS18).‘Human rights’, pages 101-103 (NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Social aspect managementactivities and results’, page 85 (NFS18); ‘Humanrights’, pages 99-100 (NFS18).‘Social aspect management activities and results’,page 85 (NFS18).

During the year Saipem held 1,472,112 hours oftraining exclusively on health and safety topics(1,497,101 for the Group perimeter), of which514,437 hours for employees (531,347 for theGroup perimeter) and 957,675 for subcontractors(965,754 for the Group perimeter).

Training hours are not shown by gender andcategory because the IT systems used forreporting do not allow for differentiating the data atthis time.Out of 31,693 employees (34,129 for the Groupperimeter), 13,130 (13,568 for the Group perimeter)were subject to performance assessment, of which51% women (53% for the Group perimeter) and40% men (38% for the Group perimeter). 98% ofsenior managers (97% for the Group perimeter),60% of managers (59% for the Group perimeter),44% of white collar (43% for the Group perimeter)and 30% of blue collar (27% for the Groupperimeter) were involved in this process.

The Board of Directors is made up of 9 members ofwhich 3 women. All Directors are over 50 years old.Women represent 11% of the workforce (for bothperimeters). For age distribution, 11% of employeesare less than 30 years old (for both perimeters),71% are between 30 and 50 years old (for bothperimeters) and 18% are over 50 years old (for bothperimeters).

GRI 405: Diversity and equal opportunity 2016

GRI 406: Non Discrimination

GRI 407: Freedom of association and collective bargaining

GRI 404: Training and education 2016

GRI 403: Occupational Health and Safety 2018


103-1,103-2 and103-3

408-1

103-1,103-2 and103-3

409-1

103-1,103-2 and103-3410-1

103-1,103-2 and103-3414-1

103-1,103-2 and103-3

103-1,103-2 and103-3

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Social aspect managementactivities and results’, page 85 (NFS18); ‘Humanrights’, pages 99-100 (NFS18).‘Social aspect management activities and results’,page 85 (NFS18); ‘Human rights’, pages 99-100(NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Social aspect managementactivities and results’, page 85 (NFS18); ‘Humanrights’, pages 99-100 (NFS18).‘Social aspect management activities and results’,page 85 (NFS18); ‘Human rights’, pages 99-100(NFS18).

‘Human rights’, pages 100-101 (NFS18).

‘Human rights’, pages 100-101 (NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Social aspect managementactivities and results’, page 86 (NFS18).‘Social aspect management activities and results’,page 86 (NFS18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Directors’ Report’, pages40-43 (AR18).

‘Reporting methodologies, principles and criteria’,pages 71-74 (NFS18); ‘Saipem people’, page 98.

10% of security personnel were trained on ethicsand compliance topics in 2018.

The data on vendors are collected by means of aqualification questionnaire and then analysed.

2.5% of qualified vendors were assessed on humanrights issues in 2018. Please note that only newvendors who provide goods and servicesbelonging to the most significant commodity codesoperating in counties deemed critical wereassessed on these topics.


107

GRI 409: Forced and Compulsory Labor 2016

GRI 410: Security Practices

MATERIAL THEMES

SpecificStandard


Safe operations, asset integrity and process safety

Technological and operating innovation

GRI 414: Supplier Social assessment 2016

GRI 408: Child Labour 2016



108

independent auditors’ report

The independent auditors’ report, which concerns the Consolidated Non-Financial Statementsincluded in the dedicated section of the Annual Report, is accessible through this link.


http://www.saipem.com/en_IT/static/documents/SaipemBil18Eng.pdf#page=110

Headquarters: San Donato Milanese (Milan) - Italy

Via Martiri di Cefalonia, 67

Branches:

Cortemaggiore (Piacenza) - Italy

Via Enrico Mattei, 20

Information for Shareholders

Saipem SpA, Via Martiri di Cefalonia, 67

20097 San Donato Milanese (Milan) - Italy

Relations with institutional investors

and financial analysts

Fax +39-0244254295

e-mail: [email protected]

Publications

Relazione finanziaria annuale (in Italian)

Annual Report (in English)

Interim Consolidated Report as of June 30

(in Italian and English)

Saipem Sustainability (in English)

Also available on Saipem’s website:

www.saipem.com

Website: www.saipem.com

Operator: +39-0244231

Layout and supervision: Studio Joly Srl - Rome - Italy

Printing:

Società per Azioni

Share Capital €2,191,384,693 fully paid up

Tax identification number and Milan, Monza-Brianza, Lodi

Companies’ Register No. 00825790157

ExtractDNF18.qxd 17-04-2019 10:13 Pagina III

saipem spaVia Martiri di Cefalonia, 6720097 San Donato Milanese (MI)

saipem.com

ExtractDNF18.qxd 17-04-2019 10:13 Pagina IV

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