Functioning in a global environment PKN ORLEN is affected by various factors, mainly macroeconomic ones, such as oil prices or refinery and petrochemical margins fluctuations across the world, exchange rate changes, and regional and global economic growth.
There are also certain factors typical of the industry in which the Company operates:
Considering the specific (strategic) character of our business, and the nature of the industry in which we operate, PKN ORLEN’s situation is also determined by trends in the institutional and regulatory environment (e.g. environmental standards or compulsory fuel reserves).
Aware of the fact that in the long term, the above factors may pose a threat to the proper, sustainable development of the Company and that their intensification is currently taking place in a situation of global slowdown, we are taking numerous measures to ensure stable growth for PKN ORLEN and to change some of those risks into significant opportunities.
In order to achieve this we intend to:
Risk is inherent in business. Each business involves risks which sometimes may be very serious and not easily predicted. This is why PKN ORLEN has implemented a risk management system which guarantees that business decisions are taken in full awareness of current risks. The company is well prepared to respond to materialised risks so as to minimise their possible impact on the continuity and possibilities of achieving the business goals we have set.
Risk management is based on procedures which enable identification of respective risks, risk allocation to respective owners, risk analysis in the Company’s key areas and recommending preventive measures. To support the system, we have internal reviews (both with respect to internal procedures and the external environment) relating to the Company’s most important business areas from the point of view of its current operations. By integrating the risk management system, we will be able to implement a uniform approach to risk management, which will translate into a uniform approach to the strategic planning of business operations and internal inspections. The risk management system responds to the needs of a broad circle of the Company’s stakeholders who want to better understand the wide range of risks facing the Company, so as to be certain that those risks are properly managed.
The quality of communication with the outside environment is extremely important here. Communicating reliable information in a precise and unambiguous way significantly helps reduce risk. PKN ORLEN pays great attention to transparent and pro-active communication with all groups of stakeholders. The Press Office plays a special role in conducting dialogue with external partners. It is responsible for contacts with the media, which for PKN ORLEN are not merely another stakeholder group but also an important representative of social interests.
In 2008, the Press Office issued 186 press releases, through which public opinion was informed of the most important events and decisions concerning the Company and the corporate projects it implemented. Journalists and public opinion were informed of financial results, investment projects, production projects, decisions of General Meetings or the Supervisory Board, sponsorship involvement, charitable activities, projects of the ORLEN Gift from the Heart Foundation or employee volunteering. A standard formula was introduced to notify of initiated and completed tender procedures in categories of particular image sensitivity, such as purchasing biofuel or advisory services. Moreover, in 2008, the Press Office gave over 1,500 individual answers to journalists on various issues of interest to them.
The result of the Press Office’s work in 2008 was a measureable growth in media interest in the Company’s activities. The number of media releases relating to PKN ORLEN almost quadrupled compared to the previous year and amounted to 39,301*, compared to 10,845 in 2007. Positive and neutral news represented over 98.7% of all releases.
Moreover, the Company’s press services organised 9 press conferences and briefings.
The ratio of negative releases on PKN ORLEN in the reported period was only 1.3%. The vast majority of negative media releases last year belonged to the “energy security” category (58 releases) and “personal changes in the Company” (113 releases). Interrupted oil supplies via the Druzhba (Friendship) Pipeline to the Czech Republic, record fuel prices (259 releases) and changes in the composition of the Management Board were the main reasons for negative comments in the media. It should be emphasised that the vast majority of negative releases were caused by factors outside the control of PKN ORLEN and not related to its direct operations. Meanwhile, the number of arguable releases or required corrections significantly dropped. This usually meant that the Company’s position was already presented in a text. Approximately 20 corrections and disagreements were published over the year.
Moreover, the Company gave 16 answers to enquiries from the Office for Competition and Consumer Protection (all under explanatory procedure). There was also one answer to a question from the Municipal Consumer Ombudsman in Gorzów Wielkopolski and one from the Mayor of the City of Rzeszów. In 2008, one antitrust procedure against PKN ORLEN was instituted (with two more pending for several years).
*All data quoted after: Instytut Monitorowania Mediów (Media Monitoring Institute): Evaluation of media releases monitored for PKN ORLEN, Warsaw 2009
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