Decoding the Environmental, Social and Governance framework: OMV's tangible Steps Towards a Sustainable Future
Reading time: 2 min
What is a good investment? While companies and their success can be assessed by economic factors, the so-called ESG ratings offer a broader perspective. Laura Engshuber-Wohnhaas, ESG expert at OMV, tells us why OMV regularly scores well in these ratings and, which tangible steps have been taken..
"ESG is all about measuring good," explains Laura Engshuber-Wohnhaas. ESG stands for Environmental, Social and Governance and the ratings offer decision-making aids for sustainable investing. These ratings are carried out by external agencies that examine various factors, such as environmental and climate protection, human rights or working conditions.
Enabling a modern sustainable lifestyle
While sustainability may not be the first thing that comes to your mind when you think of a company like OMV, it's worth taking a closer look. "We really work hard on changing our business model to be more sustainable. It can take many forms," Laura Engshuber-Wohnhaas is convinced. "Like emissions from travel: Instead of avoiding air travel, at all we can try to operate them with sustainable fuels that are made from used cooking oils. We want to enable people to continue to live their lives in a modern way but do so more sustainably."
An overall perspective
It was only last week, OMV received a AAA rating, the highest possible score, from MSCI for the 11th year in a row. An important factor is that ESG ratings look at more than products alone. Numerous companies claim to offer "sustainable" products, yet their ESG ratings fall short due to factors like labor rights violations, corporate governance concerns, or the absence of a low-carbon strategy to minimize emissions throughout their production processes. “Meanwhile OMV has very good sustainability management practices. We focus on everything from safety to reducing operational emissions to water management, community engagement, and so on. So we’re looking at sustainability in a holistic way because sustainability is more than just climate and it's more than just climate-friendly products.”
Raising the standards
"Although ESG ratings are not mandatory, they are a major driving force behind lifting standards worldwide and go hand in hand with legislation such as the Supply Chain Act. ESG ratings are a commitment to the capital market and towards the public to engage in certain standards and maintain them. Specially in Europe, we have some initiatives that prevent companies from making false claims, such as the new Green Claim Initiative. So we can't just make something up to get a good rating."
Creating a sustainable business model
"You can't just place all oil and gas companies in the same pot together. Oil companies that just stick to the same old model are not fit for the future. We, on the other hand, see ourselves as a driver for change and are working, for example, on reducing oil and gas production. We are focusing on other sustainability areas and adapting our product portfolio to include areas, such as Sustainable Aviation Fuel or renewable energy sources like geothermal and solar energy," says Laura Engshuber-Wohnhaas. "We really work hard to be part of the change."
Listen to our podcast episode of “Rethinking Resources” to get a deeper insight into the topic of ESG ratings:
