Friday 15 December 2017

DNV Assurance Statement

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Titan Group CSR and Sustainability Report 2010

Introduction

Det Norske Veritas (hereafter ‘DNV’) has been engaged by the management of TITAN Cement Company S.A. (hereafter ‘TITAN’) to provide assurance services in connection with the English version of TITAN’s Corporate Social Responsibility (CSR) and Sustainability Report 2010 (hereafter ‘the Report’). This engagement focused on the information provided in the Report and the underlying management and reporting processes. It also included an assessment of the Report’s alignment with the WBCSD CSI performance measurement and reporting guidelines for CO2 and H&S. Moreover, it includes an assessment of the Report against the criteria of the Global Compact for a Communication on Progress of Advanced Level.

This Assurance Statement is aimed at the readers of the Report. The management of TITAN is responsible for all assertions and information provided in the Report, as well as the processes for collecting, analysing and reporting that information. DNV’s responsibility regarding this assurance engagement is to the management of TITAN only, in accordance with the scope of work commissioned. DNV disclaims any liability or responsibility to a third party for decisions, whether investment or otherwise, based on this Assurance Statement or the detailed Assurance Statements on the WBCSD CSI initiative or the Global Compact Communication on Progress criteria, available at http://report2010.titan.gr/en/

Scope

The scope of DNV’s assurance engagement included the verification of data management processes and reported information. This was carried out in the context of TITAN’s CSR and Sustainability strategy, management processes and performance in the 12 month period ending on 31 December 2010. The scope of work included a review of:

  • CSR and Sustainability policies, objectives, initiatives, practices and achievements in 2010, described in the Report. These were verified at Group and regional levels, and in the following countries: Greece, Serbia and the United States of America (U.S.A);
  • Extent to which Group, regional and country-level policies, practices and procedures are known, understood and implemented at the following sites: Patras (Greece), Kosjeric (Serbia), and Campostella Ready Mix Plant and Norfolk Terminal (USA);
  • Processes for identification and prioritization of material issues in the U.S.A;
  • Processes for defining the boundary, focus and content of the Report; 
  • Processes and tools for collecting, analysing, aggregating and reporting quantitative and qualitative data in the Report; 
  • Adherence to WBCSD CSI performance measurement and reporting guidelines for CO2 and H&S; 
  • Reliability of CO2 and H&S performance data for 2010, presented in the WBCSD/CSI table on page 66 of this Report, and associated assertions in the relevant sections of the Report; 
  • Adherence to the principles set out in the Global Reporting Initiative (GRI) Sustainability Reporting Guidelines (2006), as well as the application level declared by TITAN; 
  • Extent to which the Report meets the Global Compact criteria relating to an Advanced Communication on Progress; 
  • Adherence to the principles of Materiality, Inclusivity and Responsiveness established in AA1000 APS (2008); 
  • Reliability of information relating to TITAN’s management approach and achievements; 
  • Reliability of performance data presented in the Environmental and Social Footprint sections of the Report, and associated assertions.

This assurance engagement included an assessment of the quality of data, information and assertions made in the Report. It did not include a detailed assessment of the adequacy, effectiveness or efficiency of Titan’s strategy or management of CSR and Sustainability issues. It also excluded an assessment of CSR and Sustainability management, performance and reporting practices by Titan’s suppliers and other third parties mentioned in the Report.

Statement of Independence

DNV states its independence and impartiality regarding this assurance engagement. In 2010, DNV did not work with TITAN or any of its stakeholders on any engagements which could compromise the independence or impartiality of our findings, conclusions or recommendations. Moreover, DNV was not involved in the preparation of any text or data provided in the Report, with the exception of this Assurance Statement and the detailed Assurance Statements relating to the WBCSD CSI initiative, and the Global Compact Communication on Progress criteria, provided online.

Approach

This assurance engagement was carried out between December 2010 and June 2011, by a multi-disciplinary team of suitably qualified and experienced professionals. It was carried out in line with the DNV Protocol for Verification of Sustainability Reports, which is based on the Global Reporting Initiative (GRI) Sustainability Reporting Guidelines (2006), AA1000AS (2008) and AA1000APS (2008). Moreover, the Global Compact Communication on Progress criteria for ‘Advanced Level’ was also used as a basis for this engagement.

The verification of CO2 performance information was carried out in accordance with the criteria established in ISO14064 (Part 3), the verification protocol developed by the International Emissions Trading Association and the WBCSD CSI CO2 Accounting and Reporting Standard for the Cement Industry (June, 2005). The verification of H&S performance information was carried out in line with the WBCSD CSI Safety in the Cement Industry: Guidelines for Measuring and Reporting (October, 2008). All elements of this assurance engagement were carried out in accordance with the requirements of AA1000AS (2008) for Type 2, moderate level of assurance.

This assurance engagement comprised the following tasks: 

  • Interviewed over 10 management representatives at Group level, focusing on the following functional areas: CSR and Sustainability; Human Resources; Environmental Management; Health and Safety Management; Internal Audit; Research and Development; Procurement; Finance; Investor and External Relations;
  • Facilitated a half day workshop at TITAN America’s headquarters in Norfolk, Virginia, aimed at verifying TITAN’s perceptions of material issues in the country. This workshop was attended by representatives of Titan America’s senior management team and senior executives. This was followed by interviews and a half day visit to Campostella Ready Mix Plant and the Norfolk Terminal, to further discuss and verify the issues highlighted during the workshop. This enabled DNV to perform a comprehensive verification of the Report’s content, particularly regarding its materiality. It also enabled an assessment of the adequacy of materiality assessment processes and their consistent application across the Group. This reflects TITAN’s commitment to demonstrating transparency and ensuring an adequate adoption of relevant reporting principles; 
  • Carried out a three day visits to the Patras (Greece) and Kosjeric (Serbia) plants, focusing mainly on the management of Environmental, Health & Safety, Human Resources and Community Engagement/Relations. These visits also included a detailed assessment of data management processes and the verification of data relating to Health & Safety and CO2 performance. The visits also enabled an assessment of alignment of on-site practices with Titan Group’s strategy, policies and processes. They included: interviews with plant, operations and functional area managers (mainly Plant Management, H&S, Environment and Human Resources), observation of plant operations, review of documentation, records, data, data management processes and practices. These sites were selected on the basis of their significance from a CSR & Sustainability perspective and following TITAN’s programme for external assurance; 
  • Analysed corporate data management systems (for Human Resources, Social, Health & Safety, and Environmental data, including CO2 emissions), assessing the materiality, reliability and completeness of selected data reported by TITAN in accordance with the requirements of AA1000AS (2008) and AA1000APS (2008), WBCSD CSI and Global Compact Communication on Progress criteria. The assessment of reliability (including completeness and accuracy) of data and information was based on explicit assertions regarding sustainability performance on material issues. It included a review of the methods, practices and tools used in collection, management, internal quality control and reporting of data and information, as it is transferred and managed at different levels in the organisation. DNV’s assessment also included: high-level trend analysis, the identification and analysis of causes behind significant changes in performance, compared to 2009, a review of data traceability, and record checks at different stages in data flows from source to Group level; 
  • Challenged data, assertions and claims made in the Report and reviewed supporting information; 
  • Reviewed a selection of internal communications, external stakeholder engagement plans and reports, and external media reports relating to TITAN’s CSR and Sustainability management and performance.

Conclusions

In DNV’s opinion, based on the work carried out, the Report provides a reliable and fair representation of TITAN’s CSR and Sustainability-related policies, objectives, initiatives, practices and performance in 2010. DNV also believes that the Report generally meets the content and quality requirements of CSI, Global Compact, GRI (2006) and AA1000AS (2008) and AA1000APS (2008). The Report also fulfils the requirements for the GRI (2006) application level of A+ declared by Titan, and meets the criteria for a Communication on Progress of Advanced Level, according to the Global Compact.

Regarding the alignment of reported information with the WBCSD CSI guidelines and other relevant standards mentioned above, DNV concludes that, based on the work undertaken, the information provided is reliable and: 

  • CO2 - Boundary setting (at Group and Site levels) meets the mandatory requirements of the relevant performance measurement and reporting standards and guidelines. Testing of the reporting systems currently in place demonstrated a robust and well managed process for collection, management and reporting of CO2 performance data at Group level and in the countries and sites visited. No material errors or omissions were found. There was good evidence of an improved process for internal verification and revision of reported data; 
  • H&S - Robust corporate procedures and guidelines for H&S data collection, management and reporting exist at Group level. These are aligned with the principles and fulfil the requirements of relevant measurement and reporting guidelines. Corporate procedures and guidelines are generally well known and implemented in the countries and sites visited. There was good evidence of an improved process for internal verification and revision of reported data.

Further conclusions and observations on the adoption of reporting principles and specified performance information are made below.

Inclusivity and Responsiveness 

  • TITAN has continued to adopt a structured approach to stakeholder consultation and engagement, described in detail in the Report (mainly in connection with specific internal and external stakeholder consultation events);
  • The Report has been informed by the results of stakeholder consultation and feedback received in previous versions of the Report. There is strong evidence of Titan’s efforts to respond to the main concerns and interests of stakeholders and increased efforts to demonstrate how these have been addressed.

Materiality 

  • In addition to the stakeholder engagement initiatives mentioned above, TITAN has continued to engage with SRI rating agencies, WBCSD CSI groups, academia and industry working groups in order to identify and better understand the CSR and Sustainability issues which are most material to the sector, operations and regions within which the Group operates;
  • The scope of TITAN’s materiality assessment has increased, with greater focus being placed on TITAN’s operations in Eastern Europe and the U.S.A. Most of the countries where TITAN operates have now been subject to external verification of their materiality assessments (except for Turkey and Kosovo); 
  • TITAN’s materiality assessment results have been adequately used as a basis for the preparation of the Report, guiding the identification of issues and ensuring that the emphasis given to assertions and information on various topics is proportionate to their relative materiality.

Reliability 

  • The data measurement techniques and basis for calculations have been adequately described to DNV. No systematic or material errors have been detected for data and information verified in accordance with AA1000AS (2008),

WBCSD CSI or other relevant guidelines. When potential errors or omissions were identified in CO2 or H&S performance data, these were promptly justified or corrected by Titan; 

  • There is evidence of an improved process for internal control of the quality of data. This enabled data to be checked and corrected by TITAN, improving the reliability of the Report; 
  • A structured and robust performance monitoring and reporting system is in place for CO2, H&S, SOx, NOx and dust performance data, which is believed to be capable of providing consistent and reliable performance information; 
  • The Report covers all entities that meet the criteria of being subject to control or significant influence of the Reporting organisation; 
  • There has been an improvement in reporting on biodiversity and water use. Robust processes and tools have been adopted, which will facilitate the measurement and reporting of performance on these topics in the future; 
  • Reporting on socio-economic impact and the sustainability performance of products has improved but continues to be a challenge. However, these are areas which Titan is committed to improve on in future Reports.

Neutrality 

  • The report generally provides a fair and balanced representation of TITAN’s CSR and Sustainability management approach, performance and challenges in 2010, both in terms of content, tone and emphasis.

Comparability and Clarity 

  • Progress has been made in presenting information in a format which facilitates understanding and the comparison of performance with previous years, highlighting the key efforts and achievements over the last 10 years. Moreover, issues are increasingly been presented in a lifecycle perspective, which makes it easier for the reader to consider TITAN’s performance in the overall context of the cement industry and associated industries/activities; 
  • Ensuring the comparability of Titan’s performance over time continues to be a challenge on a number of CSR and Sustainability issues (e.g. environmental performance and employment) mainly due to changes in product output and the composition of the Group in recent years. It is not always easy to establish whether changes in reported performance are the result of changes in actual performance, the composition of the Group, or due to changes in efficiency of production activities. However, TITAN has made some improvements in this aspect of its performance reporting, and is committed to continually refine its approach to measuring and reporting on its CSR and Sustainability performance.

Overall, DNV commends Titan for its commitment and achievements in continually improving their understanding of material issues, the concerns and expectations of stakeholders, and addressing these in a constructive manner, minimising detrimental impacts from its operations and seizing opportunities to benefit its stakeholders. TITAN has also demonstrated its commitment to continually improve the quality and credibility of its Report and underlying processes, and harmonizing CSR and Sustainability management and reporting practices across the Group.

Opportunities for improvement

Based on the findings of this assurance engagement, the following recommendations are made to encourage continual improvement:

  • Undertake a detailed assessment of CSR and Sustainability management processes, practices and performance at TITAN’s operations in the more recently acquired plants (Turkey and Kosovo). Ensure the harmonisation of CSR and Sustainability management and reporting practices with TITAN Group;
  • Undertake a more detailed assessment of the materiality of CSR and Sustainability issues relating to TITAN’s aggregates and Ready Mix activities. Detailed materiality assessments are also recommended for the U.S.A (adding detail to the assessment in 2010) and Greece (revising the assessment carried out in 2007); 
  • Continue to raise awareness and internally verify compliance with Group data management processes and reporting guidelines, mainly regarding the aggregation and reporting of data at regional and country levels;
  • Better define Titan’s approach to Stakeholder Engagement at local level, identify and disseminate good practices; 
  • Develop a more structured approach to measuring and reporting performance on the following aspects: socio-economic impact of TITAN’s activities and voluntary initiatives; sustainability performance of products; and sustainability performance of TITAN’s supply chain; 
  • Continue to investigate the level of interest in the CSR and Sustainability Report of various stakeholder groups in the countries where Titan operates. This should also consider the role of the Report as part of a suite of channels and strategies for communication on CSR and Sustainability, supplementing other stakeholder or locally-appropriate communication methods.

Antonio Ribeiro
Lead Sustainability Verifier
Project Manager
  Sven JP Starckx
Lead Environmental and GHG Verifier

Det Norske Veritas, Oslo, 3 June 2011

1st prize for quality
awarded to 2009
TITAN CSR and Sustainability
Report


For the third consecutive year the Aegean University in Greece awarded TITAN Cement S.A. the first prize for the quality of its Corporate Social Responsibility and Sustainability Report. Aegean University evaluates the CSR and Sustainability Reports published in Greece by businesses and other organizations, using the international GRI/G3 standards of the Global Reporting Initiative and a methodology developed by the Business Environment Policy and University’s Management Department.

The reports are evaluated in terms of “completeness” and “relevance”, “quality” and “materiality” compared to GRI indicators.

The results were announced during the annual CSR Reporting Forum, held in Athens, in November 2010.