Since 2005, the employees have applied the Code of Ethics developed in the course of discussions and consultations in all areas of the Company. The Code is based on specific values and it determines the principles that should guide the Company and its employees in their relations with the internal and external environment. Its provisions are taken into account in operating regulations applied in the Company’s management.
A constant process realised since the implementation of the Code are measures aimed at disseminating the document among old and new employees. In 2008, we held 18 group meetings in the form of training sessions and workshops, during which appr. 540 people were trained (6 workshops were participated by appr. 170 new employees). Participants of all educational activities are reminded of the strong relationship between the Code and the Human Rights Charter.
The general principles of the Code of Ethics and its chapter devoted to relations within the Company emphasise the need to observe the law and good habits, and the principle of respecting the dignity of each human being. In the Code, the Company declares its respect for the national origin, race, religion and political orientation of its employees, customers and business partners as well as equal and fair treatment of all irrespective of the above or of the position held by a person, his or her seniority in the Company, membership of trade unions or appearance. PKN ORLEN did not report a single case of breach of the above principles in 2008.
The democratically elected Ethics Ombudsman plays a special role in PKN ORLEN, his or her task being to ensure that all stakeholders have a possibility to freely report on any breach of the principles of PKN ORLEN’s Code of Ethics. Employees may report to him or her any irregularities, thus developing a feeling that they have a say in respecting core values. The Ethics Ombudsman is obliged to ensure the confidentiality of employees who complain. His or her role is to explain their relevance and, if need be, take or initiate remedial measures. The Ethics Ombudsman keeps the Management Board informed of any ethical problems notified by employees. It is always done in such a way as to guarantee confidentiality and prevent the identification of people making complaints or submitting motions. In special circumstances, where the welfare of the Company is at stake, the Ethics Ombudsman reports directly to a competent Member of the Management Board. He or she also presents to the Management Board annual reports of their activity to promote a corporate culture based on ethics and respect of PKN ORLEN values. The Ombudsman’s tasks also include promoting ethical values during meetings and training sessions, and via the corporate ORLEN ekspres newsletter, where he or she has a regular column.
The Ethics Ombudsman monitors the functioning of the Code of Ethics based on the issues reported to them and submits a consolidated report to the Management Board. Respondents mainly point to the organisation’s weak links related to situations and events happening in their everyday work. Another effect of growing employee awareness of standards imposed by the Code of Ethics is the fact that they comment on an increasingly broad range of problems, including moral ones, and they are getting involved in a discussion on situations posing moral dilemmas. The monitoring performed in 2006–2008 showed that the number of complaints on unprofessionalism significantly dropped at that time. Respondents mainly focused on problems relating to a lack of responsibility affecting the Company image and relations within the Company. The Ethics Ombudsman investigated each reported issue or took adequate remedial measures. The Ombudsman resolved the majority of them – as many as 60% of cases which required specific actions and solutions, to the satisfaction of those directly involved. Taking into account the long-term character of attitude change in the reported moral cases (23%), educational and communication measures were taken through corporate media which on the one hand condemned disobedience of the Code of Ethics and on the other promoted proper behaviour (47 articles and programmes in ORLEN ekspres and ORLEN Studio). For the remaining 17% cases, remedial measures are being implemented whose long-term effects are to be structured solutions on the level of the entire organisation (such as operational HR solutions in accordance with the Collective Labour Agreement implemented in 2009).
Each year, PKN ORLEN implements projects aimed at promoting both the provisions of the Code of Ethics and the Company’s core values. Every 2–3 years, surveys are performed to verify the effectiveness of those projects and to monitor the level of employee knowledge of issues important both for the Company and for its employees.
In 2008, the traditional communication audit covered, apart from PKN ORLEN itself, over 2,500 employees of 20 Capital Group Companies. An anonymous questionnaire included questions on internal communication within companies, integration and communication in the ORLEN Group and interpersonal relations. The survey revealed the information requirements of company employees, their most highly regarded communication channels and the level of knowledge of issues significant for their respective companies. The survey also helped determine what kind of information on PKN ORLEN and the ORLEN Group employees of respective companies expect and in what way they would like to receive such information, and what kind of integration activities they expect. This is similar to the case with the survey conducted at PKN ORLEN, some questions related to various aspects of corporate culture, in particular – ethics.
The most important effect of the surveys were: a gradual improvement in the level of communication and application of the most effective measures corresponding to the needs and expectations of employees. Moreover, the audit gave an insight into interpersonal relations in respective companies and employee expectations in this respect.
We regularly have evaluation questionnaires after integration meetings, sports events and picnics from which we learn about the opinions and preferences of employees which we then take into account when organising similar events in the following years.
In 2008, corporate principles and values were promoted via a radio campaign, continued from previous years, and a series of films broadcast online. The Corporate bi-weekly, ORLEN Ekspres, published a series of satirical cartoons about the adventures of a group of employees doing their everyday chores at work and spending their time together after work. This was an original and clever way of promoting core values.
Reliable, high-quality internal communication channels in PKN ORLEN supply employees with up-to-date, top quality information and are an important factor in involvement building among employees. From among the three main communication channels, the corporate radio station, ORLEN Studio, has a large loyal audience of nearly 5,000 listeners. The corporate bi-weekly ORLEN Ekspres has been popular for years, its readers amounting to over 90% of staff. In 2008, the newsletter won the Bronze Column award in the “Column of the Year” competition organised by the Corporate Press Association.
Employees willingly use the intranet, which is an effective means of communication. It also enables quick searches for information from various areas of the Company’s activities. Other ways to disseminate information among all employee groups are meetings or information boards.
PKN ORLEN pays great attention to dialogue with employee representatives in the Trade Unions. An opportunity for such dialogue is the various events in the Company. One example is the Chemistry Days, a holiday for all employees, traditionally celebrated on the first weekend of June. Each time, the draft agenda of events is presented to and discussed with our social partners. Any suggestions made by the Trade Unions are analysed by the Company’s Management Board. The Management Board’s decision to amend the agenda after consultations with the Trade Unions is reported back to the Trade Unions. Each year, agendas are prepared initially for employees and bearing employees in mind. Apart from an open programme for the inhabitants of Płock, the Company has organised integration picnics for employees and their families for the last four years.
Corporate culture and its attendant dialogue with employees through all corporate media constitute an important element of the strategy of building goodwill towards PKN ORLEN.
PKN ORLEN’s Management Board takes all reasonable efforts to make sure that all Company business is done in accordance with the principles of corporate governance. As a public company whose securities are issued on the Warsaw Stock Exchange, PKN ORLEN observes all the principles recommended by the Code of Good Practice for Companies listed on the WSE. It also takes a number of measures to streamline communication with its environment, e.g. through modern communication technologies with representatives of the capital market. We organise live online transmissions, with simultaneous translation into English, of press conferences organised after each important event in the Company, such as the publication of quarterly reports, the announcement of strategy, or General Meetings of PKN ORLEN Shareholders. Recordings of such transmissions, in the form of multimedia fi les, are available on our website: www.orlen.pl.
In 2008, the Company applied all the principles of corporate governance laid down in the Code of Good Practice for Companies Listed on the WSE, adopted by the Supervisory Board of the Warsaw Stock Exchange on 4 July 2007.
The Supervisory Board continuously supervises the Company’s activities in all areas of its business, and in particular it has the competences determined in the Polish Code of Commercial Companies and the Company’s Statutes.
Members of PKN ORLEN’s Supervisory Board are appointed and dismissed in accordance with the Company’s Statutes by the General Meeting of Shareholders. The Supervisory Board consists of six to nine members appointed for a joint term of 3 years. In 2008, four of the nine Members of the Supervisory Board fulfilled the criteria of being independent from the Company.
The Supervisory Board acts as a body, however, it may delegate certain supervisory tasks to its individual members. The authorities of the Supervisory Board include, among others, to represent the Company in agreements with the Management Board members, including with respect to their employment and remuneration.
There are four committees within the framework of the Supervisory Board:
The Audit Committee comprises at least two independent members and at least one member qualified and experienced in accounting or financial matters.
In 2008, the Supervisory Board had 8 male and 1 female member. The age structure of the Supervisory Board members was the following:
Details of the skills and professional experience of the Supervisory Board members are available on the PKN ORLEN website.
December 2002
Less than four months after amending the provisions of the WSE Regulations relating to corporate governance, PKN ORLEN issued a statement on its intention to implement the changes proposed by the WSE with respect to the principles of corporate governance.
June 2003
The Company announced that it was applying the principles of good and loyal corporate governance through its own corporate law, at a level corresponding to the expectations of the market and its participants, taking into account the reasonable interests of the Company and its shareholders.
June 2004
A General Meeting of PKN ORLEN adopted a resolution pursuant to which the Company undertook to observe most corporate governance principles. On this basis, the Company published a statement on its acceptance of all the general principles laid down in the “Good Practice in Public Companies in 2002” paper and the 39 best practice principles relating to general assemblies, supervisory boards, management boards and relations with third parties and external institutions.
October 2004
In October 2004, the composition of the PKN ORLEN Management Board changed. The new Management Board decided that one of its main tasks would be to make the Company adopt all the corporate governance principles as soon as possible. The Management Board position was reflected in the Letter from the President of the Management Board included in the 2004 annual report, in which the Management Board expressed its readiness to promptly implement all the corporate governance principles recommended by the WSE.
January 2005
On 21 January 2005, based on resolutions adopted by the Management Board and Supervisory Board, a statement was prepared in which PKN ORLEN undertook to observe all the corporate governance principles recommended by the WSE. An updated statement was submitted for acceptance to the Ordinary General Meeting of PKN ORLEN Shareholders on 29 June 2005.
June 2005
An Ordinary General Meeting of Shareholders approved all but one principle (principle no. 20 relating to the autonomy of supervisory board members) of corporate governance. A relevant statement by PKN ORLEN was published on 30 June 2006.
June 2006
On 28 June 2006, the Company published, in accordance with the requirements of WSE Regulations, an annual statement approved by an Ordinary General Meeting of PKN ORLEN Shareholders. The Company declared, as it had done the year before, that it applied all the corporate governance principles with the exception of principle no. 20 relating to the autonomy of at least half of supervisory board members, which principle was once again rejected by the General Meeting.
May 2007
On 31 May 2007, the Company published, in accordance with the requirements of WSE Regulations, an annual statement approved by an Ordinary General Meeting of PKN ORLEN Shareholders. The Company declared, as it had done the year before, that it applied all the corporate governance principles with the exception of principle no. 20 relating to the autonomy of at least half of the supervisory board members, which principle was once again rejected by the General Meeting.
April 2008
On 23 April 2008, the Company published, in accordance with the provisions of WSE Regulations amended on 1 January 2008, a report on the application of the corporate governance principles in PKN ORLEN in 2007. The report was published together with the Company’s 2007 annual financial statement.
April 2009
On 30 April 2009, the Company published, in accordance with the provisions of WSE Regulations amended on 1 January 2008, a report on the application of the corporate governance principles in PKN ORLEN in 2008. The report was published as an appendix to the Management Board 2008 report.
Relations with Company shareholders, potential investors in its securities and stock exchange analysts are a priority for the Management Board. The President, Vice President and Members of the Management Board are the main persons contacting the capital market. In order to provide all interested persons with equal access to information, all information communicated outside as the Company’s official position is prepared in Polish and English. All officially communicated information and data is displayed on the Company website.
The Company regularly and actively participates in meetings with investors and analysts both in Poland and abroad. During those meetings, PKN ORLEN representatives present information on the Company. It is also an opportunity to receive feedback from shareholders, investors and stock exchange analysts. In this way, knowing the information needs of its stakeholders, the Company may develop and improve its relations with the capital market.
PKN ORLEN strives to expand and diversify its investor base. To do that, the Company actively promotes its activity among potential shareholders and in new financial centres across the world.
Bearing in mind the development of new forms and improvement of the quality of communication with the capital market, we introduced the so-called “trading statement”, that consists of estimated operational data for each passing quarter and forecasts of EBIT trends taking into account the impact of macroeconomic factors and significant one-time events on EBIT. Such estimates are published several weeks before the date of publishing quarterly reports. “Trading statements” facilitate the reliable building of the Company’s financial results consensus on the capital market before they are published. Since the statements were introduced, the quality of analyst forecasts has improved significantly (average forecast deviation from the data finally published by the Company has reduced). The statement establishes new standards in the field of investor relations. Its positive reception demonstrates how much PKN ORLEN values proper and well-timed communication with the market relating to topics which are of crucial importance to investors.
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