SPE 156856 Management Systems for Social Performance:

Current Status and Trends

Karen Westley, ShellOn behalf of IPIECA Social Responsibility Working Group

Presentation Overview

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156856 • MS for SP • Westley

Elements of Social Performance Management Systems (SPMS)

Leadership and

Accountability

Policy, Standards and Commitments

Organisation, Resources and

Capability

Plans and Procedures

Identification of Risks and

Opportunities

Stakeholder Engagement

Monitoring, Reporting and

Learning

Audit and Review

Integrating Social Performance (SP)Risk assessment and management

Risk Assessment Matrices

Issues identification and management

Ethics, compliance and whistle-blowing

Stakeholder engagement ESHIA

Introduction

Introduction: Social Performance Management Systems (SPMS)

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156856 • MS for SP • Westley

WHY?

• Increased focus on external

stakeholders

Need for systematic approach

Risk management

and opportunity optimisation

IPIECA is developing guidance on integration of social performance into management systems

Overview: Integrating Social Performance

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•Risk management•Opportunity optimisationDefine scope and boundary

of SP•Mandate•Company context•ApproachDetermine how

to develop SPMS

•Targeted •Inclusive •Comprehensive

Define scope of the MS

Pros and Cons of Integrating SP into MS

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• Risk assessment and management

• Risk Assessment Matrices• Issues identification and

management• Ethics, compliance and whistle-

blowing• Stakeholder engagement• Environmental, Social and Health

Impact Assessment (ESHIA) and Management

Risk Assessment and Management

• Used to assess financial, commercial, political, technical, health and safety risks

• SP may interact and feature in these systems

• Social factors may be unpredictable and hard to quantify

• Challenge of integrating opportunity identification into risk assessment

Risk Assessment Matrices (RAM)

• Tools usually applied to an incident or event, with specific/measurable

consequences• SP can be covered but often not in meaningful way

Issues Identification and Management

• Identified through stakeholder management

• Even if not directly linked to business activities, may be

regarded as significant• Reputational focus of issues management may lead to communications response, whereas SP focused on managing

impacts

Ethics, Compliance and Whistle-blowing

• Systems normally sit within compliance

• Implementation can be similar to grievance procedures

Stakeholder Engagement• Some mining companies

integrating HSSE, stakeholder engagement, commitment tracking, social investment and grievance

• Oil and gas taking incremental approach - stakeholder engagement within social performance management system

ESHIA• Management plans

stemming from ESHIA key element to SP MS.

• ESHIA may only be carried out once

Stakeholder engagement linked to risk and performance requirements

Elements of Social Performance Management System: Leadership and Accountability

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Strong leadership and a clear mandate from senior

management endorse that social performance is prioritised in

management decisions

• The board to provide managers with authority and resources

• Each manager as a champion and role model

• Commercial managers set priorities, budgets, schedule, organization and resources

• Clear messaging in sustainability reports

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Elements of SPMS: Policy, Standards and Commitments

Policies that encompass elements of

social performance

Sustainability policy

Human Rights policy

Local Content policy

Policies related to HSSE

Policies for social impact mitigation, social investment

and and/or community

engagement

Elements of SPMS Cont’d

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156856 • MS for SP • Westley

Organisation, Resources

and Capability

Develop capability

Clarify accountability

Create performance KPIs

Manage talent

Provide assurance

Define social performance competencies

Plans and Procedures

Plans include objectives, activities, KPIs,

Resources, Budget

Plans appear in range of forms: social performance,

resettlement plans, Indigenous Peoples plans

Identification of Risks and Opportunitie

sIFC Performance Standard

1 advocates for an integrated impact

assessment

Regulatory bodies vary by country on extent to which

SIA is part of permitting process

Many companies integrating human rights into due diligence, in line

with UN Guiding Principles

Elements of SPMS Cont’dImpact Assessment, Opportunity Identification and Management

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Identification of Risks and Opportunities

Social Impact Assessment•Mitigation hierarchy

•Assessment of severity of impacts•Qualitative and quantitative methods

•Application of procedures for resettlement•Stakeholder engagement and disclosure

Social Opportunity Identification

Impact Management

Local opportunities

(linked to business activities)

Social License to Operate

Elements of SPMS Cont’dStakeholder Engagement

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• Build and sustain relationship across the project cycle

• Results in improved risk management and operational performance

Purpose

• Enhancing design and inclusiveness of engagement

• Participatory approaches to impact assessment, project monitoring and social investment

Substance

• Systems to support stakeholder engagement

• Integration of grievance procedures into stakeholder engagement

Relationship to company

management system

Elements of SPMS Cont’d: Monitoring, Learning and Reporting / Audit and Review

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Internal monitorin

g

Process-focused

Ops to have relevant plans

and procedures

Public reporting

Voluntary sustainability

reports

Collecting and analysing data

complex

Involvement of external

stakeholders in validation

Learning

Communities of practice

Incorporated into training

Info from audits shared

throughout company

Audit and Review

Incorporate into HSSE audits

External stakeholder interviews

Training auditors on SP

Summary/Wrap Up

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• SPMS is an evolving practice

• Integration of SP into existing MS is preferable

• Existing systems may need some adaptations

• Active learning and development to identify appropriate approaches and practices through IPIECA

Thank You / Questions

IPIECA Social Responsibility Working Group

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