ESG (Environment, Social and Governance)
Our company, our commitments and what we stand for
Our ambition is to be a world class Kiwi company.
Z Energy is New Zealand’s largest integrated transport fuel supplier, providing just under half of all New Zealand’s fuels - from jet fuel to marine fuel oil, to petrol and diesel, to bitumen for the roading industry.
Our operations span crude oil and refined fuel procurement from international markets, contracted domestic refining, national distribution via pipeline, ship and truck, and commercial and retail marketing.
Z listed on the New Zealand and Australian stock exchanges in 2013.
In 2016, Z bought the Caltex New Zealand operations from Chevron International which provided exclusive wholesale supply to the Caltex-branded network of independent retailers and the company’s commercial supply network.
Z owns 15.1 per cent of New Zealand Refining (NZR), New Zealand’s sole oil refinery, as well as 11 terminals and four joint venture terminals in nine port locations. Z also has a 50 per cent holding in the coastal shipping network, Coastal Oil Logistics Limited (COLL), that distributes;fuel from New Zealand’s refinery across New Zealand ports.
Z is a locally-managed, independent New Zealand fuels business with no upstream oil or gas interests. All decision-making and governance functions are in-country and we seek to behave as a distinctively transparent, values-based Kiwi company.
All of our directors are independent, including the Chair. The company has no cornerstone shareholders, with a diverse register of international and domestic institutional investors and many thousands of retail kiwi investors.
Z makes an important contribution to the operation of the New Zealand economy as well as to communities across the entire country. This is a responsibility every member of the Z team takes very seriously.
Our strategic focus - our effort and capabilities
Z’s strategy is to unlock more value and productivity from our core business and assets as we explore what the future looks like in a volatile and increasingly uncertain world.
We recognise that our future is more about being capability-led, rather than asset- or investment-led. We have the assets and the infrastructure we need to succeed as a result of investments in earlier strategy phases.
Now we’re investing in capability – customer experience, productivity, innovation, digitisation. These capabilities will support us in building a more productive core business and delivering the evolving products and experiences our customers want.
Improving digital, innovation and customer experience capabilities in particular will not only increase customer loyalty, but enable more distinctive strategy and product choices beyond 2021. For example, our current innovation focus is on three potential alternative or replacement revenue streams: future fuels, mobility and the ‘last mile’.
The New Zealand fuels market has become increasingly competitive over recent years and, while Z is strategically advantaged through its assets and operations, the company is focused on cost reduction.
We’re committed to recycling capital from non-core assets and elements of our business into innovation and growth. Any growth investments in our core business are funded from divestment proceeds rather than free cash flow.
Our business strategy and how we create value is captured in detail in our 2020 Integrated Report.
Our purpose: Solving what matters for a moving world
Z’s purpose that guides everything we do is simply ‘solving what matters for a moving world’. What matters to our world is changing, and we are changing with it.
Over 2020, the world became an increasingly uncertain place. The Covid-19 virus which swept the world impacted global and domestic supply chains as well as impacting fuel demand. During the Covid-19 lockdowns and response, Z has set new standards of transparency to investors, reporting weekly fuel volume sales. Find out more here.
Z has always placed the highest value on security of fuel supply. Security really matters to our customers and stakeholders and we’re committed to safely delivering it.
The other issue which increasingly matters to our customers, our stakeholders, and our own people is in the increasing risk of climate change.
Z accepts that the fuels we sell to our customers contribute to climate change. Arguably, nothing matters more than using our position to help transition New Zealand towards a low carbon future.
This is an area where Z has distinctive strategic advantage and a strong commitment to change. We will continue to innovate and find new ways and new partnerships to keep people moving while enabling our customers to continue to shift towards lower carbon transport options.
The juxtaposition in terms of what matters here is not lost on us: our customers and stakeholders want secure fuel supplies at the same time as we all acknowledge we need to be using less and finding alternatives. Our future success as a company lies in finding a solution to this inherent challenge.
We care about the planet we leave our children and grandchildren. Customers, stakeholders and investors can see the leadership we provide in seeking to deliver a more sustainable world.
Our approach to ESG – focussing on what matters most.
Z seeks to be best-in-class and to continually improve in the environmental, social and governance (ESG) field. Excellence in ESG at Z is simply about focusing on and bringing a high level of transparency to the things that matter most to our people, our stakeholders and our investors.
The technical term for this is ‘materiality’ - for us it’s about what really matters to people.
We aim to continually improve our performance and reporting in each of these areas and for some years now have been a leader in the adoption of integrated reporting <IR>. We have embraced the use of United Nations Sustainable Development Goals in how we report and the use of the Global Reporting Initiative reporting framework.
We comply with the NZX Corporate Governance Code and in 2020 started our journey towards full carbon and climate risk reporting against the Task Force on Climate-related Financial Disclosures (TCFD) reporting standards.
Our commitment to each of these frameworks reflects the value we place on transparency, understanding what is material to our stakeholders and to demonstrating how our business model will add value into the future, rather than simply looking backwards.
Our 2020 integrated annual report goes into detail on each of these matters and can be read in its entirety here.
Where we have greatest impact
Where we focus our efforts and attention, we have the greatest impact on the following 10 of the United Nations Sustainable Development Goals:
Where we take a stand
We choose to focus on four key areas that we think really matter – areas where we look to maximise our contribution, change the game and be distinctive. These areas are tightly linked to our ESG commitments, and to delivery of our strategy.
These four areas are what we choose to stand for – click on the link for more information from our 2020 integrated report:
Environmental Sustainability - Z will move from being a part of the climate change problem to the heart of the solution.
Community - A resilient and healthy Aotearoa New Zealand that empowers our youth, neighbourhoods, and Z whanau.
Diversity and inclusion - Being successful being ourselves and reflecting Aotearoa New Zealand.
Safety and wellbeing - Enhancing our people’s wellbeing and enabling their success.
We report in detail against our progress against these stands in our integrated annual report which you can read via the links.