Sustainability

Society

At Karoon we believe that people are the key to a successful business. We make the safety and wellbeing of our people, and those in the communities where we operate, a priority. We understand the importance of clear communication with key stakeholders and that the way to conduct a successful operation is by engaging with local communities early to build a relationship based on understanding and trust.

Our People

Karoon recognises the importance of attracting and retaining high quality staff.

Karoon is proud of our outstanding exploration success rate and we understand that this is due in no small way to the calibre of the technical and operational personnel we have recruited and retained. Similarly, our success in developing and implementing our commercial strategies reflects the commitment of our corporate staff.

As Karoon moves toward production we will continue to build on our already experienced team of development and production personnel.

Karoon aims to ensure employees are engaged in their work, motivated to improve their performance and empowered to communicate openly at all levels. This is achieved through the various internal and external human resources policies and procedures that have been developed, as well as offering staff the opportunity for training or further study, and ensuring staff are kept informed through both formal and informal briefing sessions.

The Health and Safety of our people is of upmost importance to Karoon and is carefully managed through our global Operating Management System, click here for further information, and the Occupational, Health and Safety Policy in each office. Karoon also seeks to assist staff in maintaining general good health and wellbeing through sponsoring programs such as gym memberships, first aid courses and defensive driving courses.

Diversity

Karoon considers that its diverse workforce is a key factor in keeping our business competitive and successful. We are committed to recognising the diverse capabilities that reside within our workforce such as differences in ethnicity, gender, language, age, religion, sexual orientation, socio-economic status, experience and education. We believe that diversity makes Karoon more creative and productive in its decision making.

Karoon supports diversity through our Diversity Policy. Our diversity profile is demonstrated by the following statistics which have been calculated across our global workforce*.

  1. Overall 40% of Karoon employees are female, 60 % male.
  2. 19% of employees in an Executive (including Directors) or Senior Professional role are female, while females make up 43% of those in Professional roles.
  3. Within our Technical departments (Geologists, Engineers, etc) 33% of employees are female.
  4. Females make up approximately 48% of those employed in corporate roles (Finance, Legal, etc) compared to 52% males.
  5. Approximately 62% of employees in an Executive (including Directors) or Senior Professional role are aged over 50, while 87% of those in a Professional role are aged under 50
  6. Approximately 61% of the total Karoon workforce is aged between 30 and 49 years.

*As at 30 June 2019

 

Karoon has been working toward an increasingly diverse global workforce and the Board of Directors has recently updated our measurable objectives for achieving greater gender diversity. Karoon will report against our performance in achieving these objectives annually in our Corporate Governance Statement. Our objectives, from the 2021 financial year, are:

  1. aim to achieve at least a 30% participation of each gender on the Board, in the Senior Executive and across the Karoon Group by 2025;
  2. aim to ensure the percentage turnover of female employees is equal to or less than the overall Karoon Group percentage turnover;
  3. provide unconscious bias training to the Board and Key Management Personnel (KMP);
  4. update Flexible Working Practice Guidelines;
  5. monitor Karoon’s recruitment and remuneration processes for unintended gender bias;
  6. maintain a zero-tolerance approach to gender pay gap; and
  7. ensure at least one female candidate is considered when the Board is appointing a new director or member of the KMP.

Corporate Social Responsibility

Social Responsibility Declaration

Karoon operates in a range of socially diverse environments including the northwest coast of Australia, northern coast of Peru, and southern coast of Brazil.

At Karoon we believe that the only way to conduct a successful operation is by engaging with local communities early to ascertain their culture and history and to fully understand their concerns about natural resource extraction activities, therefore building dialogue and trust from the start of an operated project. Karoon recognizes the importance of establishing transparent relationships thus fostering respect and increasing the positive impact on Karoon’s operations.

Karoon’s approach to enabling a relationship of trust with the local communities is based on our commitment to:

  • Respect local culture and customs
  • Respect the environment in which we operate
  • Comply with local agreements and adhere to the laws and regulations of the countries where we operate, as well as respond to expectations from government and regulatory authorities
  • Build our knowledge of local communities, by collating real social data, in order to respect diversity and identify different ways to contribute to the communities’ quality of life where possible
  • Promote and support the participation of communities and their representatives in Karoon projects to enable them to gain greater understanding of the hydrocarbon sector
  • Coordinate with local institutions and social organisations in the areas where Karoon operates
  • Communicate, with full transparency, all aspects of Karoon’s operations with local communities, government and regulatory authorities
  • Use innovative tools and methods to develop communication strategies to reach entire communities in the areas in which we operate
  • Implement processes to educate employees and contractors to ensure they fully understand and appreciate the diverse cultural values and traditional beliefs of local communities.
Brazil Social Commitment Statement

Developing a relationship of trust with the neighbouring communities is part of Karoon’s business strategy. Karoon is aware of the need to engage and inform the local people who live within the Company´s areas of influence about the company and its projects. Karoon has implemented strategies to promote a relationship of trust and to maintain good relationships with local stakeholders in order to carry out safe, transparent and responsible operations.

Community Relations

Social Commitment Statement

Developing a relationship of trust with the neighbouring communities is part of Karoon’s business strategy. Karoon is aware of the need to engage and inform the local people who live within the Company´s areas of influence about the company and its projects. Karoon has implemented strategies to promote a relationship of trust and to maintain good relationships with local stakeholders in order to carry out safe, transparent and responsible operations.

Social Investment

Since its inception Karoon has had a sustainable approach to strategic planning to achieve our corporate goals in all aspects of our business. This includes social responsibility and investment where our careful and considered approach has enabled us to contribute to the local communities where we operate alongside our work program spending.

Karoon understands that a successful project should contribute to an improved quality of life for the people, families, authorities, and other stakeholders who are involved in the development of our operations.

Karoon has demonstrated our commitment to communities and stakeholders by promoting local participation in both social investment activities and the implementation of our work programs. All of our social investment activities are specially developed to provide optimum benefits for those involved.

Supporting Local Economies: Mutumbi Project

When Karoon arrived in Tumbes, the company identified a lack of work opportunities for local women. Once the Company became more familiar with the region and its culture, Karoon noticed that these women showed great talent when producing handmade jewellery and other local artisanal products however, they lacked basic skills to turn this opportunity into a small business.

Based on these findings Karoon developed a program to create a small artisanal business thus empowering those communities to generate a sustainable income.

The program began in March 2012 with training in business administration, design techniques, marketing and sales. The women who have participated to date have benefited greatly from the experience and established a solid brand called Mutumbi.

Karoon continues to mentor and assist Mutumbi to achieve the goal of a self-sustainable business for local Tumbes women.

For more information, please visit: www.facebook.com/mutumbiperu

Supporting Education: Tumpis Project

In 2013 Karoon became aware that many children from low income families in the province of Tumbes were being discouraged from finishing their schooling in favour of seeking low paid employment in the local fishing industry. To encourage these students to complete their studies and continue to tertiary level Karoon developed an educational program called Tumpis. The program is open to students from low income families who have performed well in their secondary studies, and offers them the opportunity to attend university when they may not otherwise have the financial resources to do so.

Phase 1 of the Project began in 2013 with nine students. Karoon provided financial support for each student to assist with living expenses, learning tools and transport whilst attending the University of Tumbes. Today the program, currently in phase 2, has been improved to include tutoring and workshops to improve study techniques. Importantly the program encourages parental involvement in the students’ learning process to motivate and encourage academic performance.

Education Sponsorship
University Events, Brazil

Karoon sponsored two events in different Brazilian universities during 2016, namely:

  1. Petro-Sul, the largest petroleum and gas event in the south of Brazil, bringing together approximately 300 participants. The event was organized by the Federal University of Pelotas in Rio Grande do Sul and offered technical visits, lectures and courses by renowned professionals who shared insights, advances and the latest news and technological trends from the industry.
  2. The “I SPE-UDESC Petroleum Workshop”, organized by the State University of Santa Catarina (UDESC) to discuss technological, institutional and research trends related to engineering in the Oil and Gas industry. Karoon, in partnership with Haliburton, offered a workshop by André Mendonça, a specialist in drilling fluids.

Stakeholder Engagement

Karoon values its stakeholders and actively seeks to engage with them in a number of ways. The method of engagement varies depending on the needs of the stakeholder so as to optimise consultation and communication.

In keeping with our commitment to prioritise the health and safety of our employees and those living in communities where we operate, Karoon has adopted a number of strategies to ensure information is imparted appropriately and these key stakeholders are empowered to participate fully in consultation. Examples of Karoon’s engagement with investors, suppliers and regulators are:

  1. Investor and Advisors
    1. Investor Relations Team
    2. Regular reporting (Annual Report, Quarterly Review)
    3. Roadshow
    4. ASX Announcements
    5. Website
    6. Meetings
    7. Data Rooms
  2. Suppliers
    1. Tendering processes
    2. Auditing
    3. Bridging documentation to management systems such as OMS/HSEMS
  3. Governments, Regulatory Authorities and Industry Associations
    1. Open and transparent communication with governments and regulatory authorities in all jurisdictions where Karoon operates
    2. Membership of the Australian Petroleum Production & Exploration Association (APPEA), the Australia-Latin America Business Council and the Australian-Brazil Chamber of Commerce
    3. Full and open submission of all required technical and operational documentation prior to and during operations
    4. Regular review and updates of corporate documentation in accordance with ASX Corporate Governance Guidelines
    5. Internal and external audits as required

Environment

Karoon takes its environmental responsibility very seriously with environmental factors embedded in policies and practices throughout the Company. At the corporate level environmental issues are considered through the Risk Management framework, while all operations are conducted at or above all environmental regulatory levels to at least the standards set by the Karoon Operating Management System.

Risk Management

As an oil and gas Exploration and Production (E&P) company Karoon recognises the inherent operational and commercial risks in the oil and gas industry. Karoon has established a robust risk management framework that is implemented, reviewed and updated regularly by the Risk Management Team. This team is responsible for maintaining the corporate Risk Registers and reports to the Audit and Risk (corporate risk) and Sustainability and Operational Risk (operational risk) Committees of the Board. Individual risk registers are prepared and assessed at the project level both commercially and operationally.

Health, Safety, Security and Environment (HSSE)

Karoon is committed to prioritising the safety of our people, the people in the communities in areas where we operate, and the local environments ahead of property and assets, as described in our HSSE Policy. Our Risk Appetite Statement further emphasises this by stating that “In relation to matters of safety, security, regulatory compliance and ethical conduct a strict and universal low risk appetite is maintained and enforced”. We achieve this through the careful application of the Karoon Operating Management System (OMS).

The Karoon OMS includes a number of global, high level, documents as well as project specific detailed documents such as a HSSE Plan, Emergency Response Plan and Incident Management Plan, which must conform to the higher level documentation.

Karoon’s leadership takes responsibility for implementing the OMS through the primary document, the OMS Standards, applying it rigorously throughout the organisation with particular emphasis in operational areas. Our OMS is regularly reviewed and updated to ensure we are working to the most recent standards, at or above legal and regulatory requirements, and continuing to find ways to improve the system.

In keeping with our Standards, Karoon has ensured that all environmental approvals are prepared to at least the regulatory standards and worked closely with both government authorities and local communities to ensure communities are fully engaged in the consultation process and to identify opportunities to go further than the regulations require.

We regularly consult with employees on HSSE issues, including HSSE meetings. We have also instigated an extensive alert card program throughout operational periods to empower and encourage all employees to focus on health and safety and identify any areas for improvement.

In accordance with the Karoon OMS, HSSE Policy and Risk Management Policy a thorough risk assessment is carried out on any project before operations commence, in response to any event and as part of our auditing processes in order to ensure identified risks can be brought to “As Low As Reasonably Practicable” (ALARP).

HSSE Metrics

Through our HSSE Policy and OMS Karoon adopts a proactive approach to all aspects of HSSE. We continually aim to minimise and mitigate risk through the education, motivation and involvement of all employees, consultants and contractors. This approach has proved very successful, with Karoon being able to achieve the following HSSE metrics during our most recent operational drilling campaign (2014/15) in Brazil.

  1. Days Away Incident Rate (DAIR) = 0
  2. Total Recordable Incident Rate (TRIR) = 0.57

Environmental Reporting

Karoon has always operated with a view to minimising environmental impacts. In recent times we have increased our public reporting and disclosure to inform and reassure stakeholders that we are acting responsibly and with genuine commitment to environmental, social and corporate sustainability.

In keeping with this commitment Karoon originally chose to voluntarily report to the Carbon Disclosure Project (CDP). Karoon scored extremely well (90) in the 2015 CDP report, outscoring larger ASX 200 oil and gas companies.

Since this time the Task Force on Climate-related Financial Disclosures (TCFD) released its findings in a report which prompted Karoon to review its disclosure. From 2017 Karoon included Climate Change disclosure in its Sustainability Report as part of the mainstream Annual Report. Climate Change disclosure is reported under the TCFD suggested headings of Governance, Strategy, Risk Management and Metrics and Targets.

Karoon’s Corporate Strategy includes the consideration of renewable energy resources as an option for future business growth. In the meantime Karoon looks to reduce current emissions in the corporate environment through the use of green power, and in the operational environment through the use of efficient systems and processes.

Environmental Stewardship: Frigatebird Project

Sustainable tourism is an important industry for local development and environmental conservation in the province of Tumbes where Karoon operates in Peru. Karoon was instrumental in implementing the Frigatebird Project in Tumbes. Located in the mangroves of Puerto Pizarro, the project provided a significant boost to ecotourism and is one of the most important tourist destinations of Tumbes.

The project was designed to protect the Magnificent Frigatebird (Fregatta magnificens) by raising awareness of the birds’ plight and through information gathering. The project included scientific research that provided information about colony behaviour, food sessions, travel and mating of the Frigatebird.

The information from the scientific study has been published in a book that Karoon officially launched in November 2015. The book is still used as a valuable tool for Peruvian Universities, Government and Tourism agencies to learn about this fascinating species and have a better understanding of its value in the region’s ecosystem.

Educational campaigns with secondary and tertiary school students as well as local tourist guide training was extremely beneficial in increasing environmental awareness about the importance of the Frigatebird and its local habitat. This also led to one of the project’s main achievements, namely the increased numbers of visitors to the mangroves of Puerto Pizzaro, resulting in a significant economic benefit for the local communities.

For more information on the project, please visit: http://avesfragatasperu.com/