Managing environmental risk

We consider greenhouse gases (GHGs) and other environmental issues within the context of a broader risk management framework. Our approach to risk management is to identify, monitor, and manage the key controllable risks we face, and consider appropriate actions to respond to uncontrollable risks.

We use an Enterprise Risk Management (ERM) Program to identify, evaluate, report and monitor key risks. The ERM Program aligns with the International Organization for Standardization’s standard for risk management, ISO 31000. Management is carried out at three levels, with risk assessments carried out in conjunction with core corporate processes.

Our principal risk factors – including environmental risks – are described in detail on pages 45 to 54 of our 2012 Annual Report. While each of the principal risks is discussed individually, we also make clear our view that risks should be considered as interdependent, and both understood and managed holistically.

We consider environmental risk from many perspectives: political, legislative and regulatory implications; impacts on technology; physical dimension – such as impacts from weather; and the potential for environmental matters to give rise to litigation or changes in reputation.

The Role of Governments and Regulators

Our operations are subject to extensive laws, regulations and guidelines relating to the following: generation and transmission of electricity; pollution, and protection of the environment; health and safety; air emissions; water usage; wastewater discharges; hazardous material handling and storage; treatment and disposal of waste and other materials; remediation of sites; and land-use responsibility.

We believe that a fundamental responsibility of governments and regulators is to establish policy targets and regulatory requirements that protect the physical environment and human health and reflect society’s consensus about its priorities. We look to corporations, scientists and civil society to advise decision makers about their targets and the best policies and regulations through which they can be achieved.

Once enacted, our duty as a corporation is to comply with the laws, regulations and guidelines – and, by doing so, help achieve national, provincial and state environmental and health objectives. We also can, and do, take action that goes beyond existing legal requirements, and we take into account the Precautionary Principle when appropriate.

Strategies for Managing Environmental Risk

Comply

We work to comply with all applicable laws, regulations and guidelines, and we monitor compliance by performing environmental compliance audits with corrective actions as necessary.

Consult

We consult with all levels of government regarding policy development and current and potential legislation.

Proactively identify

We proactively identify environmental risks within operations, maintenance and construction activities and we promote awareness throughout the company.

Ensure

We ensure that employees and contractors align with our environmental policies and procedures.