Our Sustainability Strategy & Governance Structure

Our Sustainability and ESG Strategy

In the process following the prioritization analysis, value areas of the strategy that emerged in line with the ESG transformation were determined. After the strategic orientation was revealed, Zorlu Enerji's impact, value and target areas were defined. These have led to the definition of a sustainable organization and an organization with strong ESG management. Values ​​and strategic orientation formed the basis for setting the communication tone for the remainder of Zorlu Enerji's sustainability and ESG efforts.

Strategic Framework

Figure: Strategic Framework and Value Areas

The identified material issues were evaluated holistically and the value areas that Zorlu Enerji would focus on in its long-term value creation journey were determined.

According to this;

  • Nature Stewardship
  • Impact Driven Growth
  • People and culture

Areas in the upper headings have been revealed.

With the Nature Stewardship, what needs to be done in order for the biosphere, which is the layer that ensures the existence of life, to continue its cyclical functioning are discussed. In addition to direct planetary issues such as combating the climate crisis and improving biodiversity, the issue of green and reliable energy supply, which also contributes to the business model, is evaluated under this title.

Under Impact Driven Growth, growth paths that aim to create a positive impact and which are included in new generation business models such as digital, connected infrastructures, e-mobility and smart urbanization are discussed. Thus, under the protection of the biosphere, while trying to transform existing businesses from a regenerative framework, direct regenerative/repairing business model designs are evaluated under this field.

With the title of People and Culture, the management of talents and healthy employees, which are the main resources required to ensure the regenerative transformation of existing jobs and the design of regenerative/repairing business models, are discussed, while our ways of interacting with stakeholders in the regions where we have local socio-economic development and operations are evaluated in the context of generating social benefit.

Pioneer in Turkey's regenerative/restorative growth

Facilitator of Turkey's regenerative/restorative growth

The ecological systems that we have disrupted need to be renewed and improved. The economic and social systems we have produced have lagged behind the requirements of the age. Beyond being sustainable, it was inevitable to move to a new growth model by making a positive contribution to the systems that we destabilized.

In the face of all these realities and complex challenges, our industry and business models claim to produce the most appropriate solutions for the reality of the future. We, as Zorlu Enerji, aim to be the facilitator of Turkey's sustainable and regenerative growth. We contribute not only to our own operations, but also to the decarbonization and development of biodiversity of our country, by offering a restorative business model and value chain proposal with our strategy we have developed for this purpose. With our approach based on impact-oriented growth, we contribute to the innovation ecosystem in our country and develop the business models of the future. Thus, we produce innovative and regenerative value propositions beyond our core business model. With our work in the field of human and cultural development, we both contribute to local development and increase the well-being and welfare of our employees. Our transparent and ethical business approach and integrated perspective distract us from the risks of today and the future, while making it easier for us to create a positive impact with new opportunities.

Nature Stewardship – Environmental Renewal

Our first priority is to contribute to the renewal and restoration of the biosphere, to which humanity and all living things owe their existence. As Zorlu Enerji, we have been contributing to the reduction of greenhouse gas emissions in the atmosphere by investing only in renewable resources for a long time. By separating our core business, power generation, from fossil resources, we provide clean and reliable energy supply. Thus, we enable a regenerative transformation of our existing business.

We are committed to all our power generation coming from renewable sources by 2030. As a company that produces electricity and brings it together with consumers, we want to facilitate not only our own operations, but also the carbon-free growth of our customers. We contribute to the carbon-free growth of all sectors, starting with Zorlu Group companies, in order not to stay away from decarbonized markets led by Europe and other major economies and to contribute to the competitive power of our country. We are not satisfied with this, we continue to create long-term positive value by working to make our entire value chain carbon neutral by 2040.

We are working to contribute to preventing the loss of biodiversity, which is another issue as important as the climate crisis. We make investments and carry out projects for the protection of biodiversity in the regions where our operations and facilities are located. By 2030, we aim to invest 10 million TL in the protection and development of biodiversity and to be fully aligned with international frameworks. Thus, we not only prevent the possible negative effects of our activities, but also take concrete steps to protect the species and improve the biodiversity in our country.

Impact Driven Growth – Financial Renewal

The current crises and realities have led all companies and sectors to different searches and solutions. We do not have the opportunity to eliminate the causes of the crises with the same point of view. With our new business models and the power of our innovation, we are able to look at the areas we invest in from the perspective of sustainability. Thus, we achieve our goal of creating environmental and social benefits with profitable business models, and design the jobs of the future. Our investments in digitalization and e-mobility are growing exponentially. By 2030, we aim to increase the contribution of our innovative and impact-oriented works to our turnover by 20%. Thus, we make it easier to access clean and reliable energy both in our country and in our region, and we aim to be a pioneer in the development of electric mobility infrastructure.

While access to finance is becoming more costly every day, we increase our access to sustainable finance instruments with the advantages of our portfolio and the investments we make in innovative business models. We play a role in the evaluation of sustainability-based resources in our country by responding correctly to the investor perspective, which differs with global developments. Until 2030, we aim to meet all new project financing needs in Turkey from sustainable means. Thus, we will not only increase the rate of use of these resources in our country, but also provide access to these resources, which require meeting very different criteria, and prove the validity of our business models that generate benefits.

People and Culture – Social and Organizational Renewal

Healthy people and communities are key components of a sustainable society. We have seen once again during the global epidemic that if we cannot establish healthy systems, we will always remain fragile. Under the title of People and Culture, we aim to touch all stakeholders with whom we interact, from our employees to local communities. Developing innovative business models to contribute to the restoration of the ecosystem is only possible with organizations made up of healthy individuals. On the other hand, establishing organizational structures to meet the demands of individuals is not possible with past organizational models. For this reason, we make investments for the development of our employees and the future of the business.

We take steps to protect the well-being of our employees in an environment that is inclusive and where diversity is respected. We are committed to increasing our female manager ratio to 40%. An organization with diversity in every sense, not just the balance between men and women, means the development of our innovative capacity. Therefore, we aim to establish a healthy organizational structure consisting of healthy people in order to implement our strategy based on creating regenerative benefits.

It is important to us that not only our employees but also all the communities we interact with are healthy. Therefore, we contribute to local socio-economic development in the regions where we operate. In order to facilitate the realization of the Sustainable Development Goals, we implement social investments and make the local communities with which we have neighborly relations a part of our decision-making processes.

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As Zorlu Enerji, we aim to contribute to the regenerative growth and future competitiveness of our country beyond sustainability. With green and reliable energy supply, we do not only perform clean production, but also contribute to the progress of our country by creating employment on the path of green growth. We add innovative tools to our future-proof business models and help build the mobility infrastructure of the world of the future. As a trusted business partner and supplier among all our stakeholders and our ecosystem, we take firm steps towards the future.

Targets

For priority issues under value areas, targets have been set in order to monitor performance and create long-term value. Possible indicators of how these targets will be pursued and the link between the targets and Zorlu Holding Smart Life 2030 Strategy are presented.

In particular, in order to reach medium and long-term goals, annual targets should be determined and annual performances should be revealed through scorecards. Thus, the steps to be taken towards reaching the annual targets and the responsible units/persons will be defined and annual action plans will be developed.

After the value areas and strategic framework of Zorlu Enerji were revealed and the ESG Strategy and strategic actions were defined, the best governance model was defined for the smooth and effective management of the ESG strategy. This process was carried out with the participation of Zorlu Enerji's project team to identify the best available options for management and leadership.

GOVERNANCE STRUCTURE

In the approach determined according to the model, it is recommended to establish a working group under each value area and to be responsible for the implementation of actions to achieve the goals under the relevant priority areas. At the same time, issues such as the basic governance structure, risk management and transparency required to create long-term value in these value areas will be discussed under the Governance Working Group.

Working under the coordination of the HSE Directorate, the Sustainability Committee meets on a quarterly basis and is responsible for activities such as evaluating the current work, monitoring the performance on the way to the targets, and determining the regulatory actions on the issues that are behind in terms of performance. Working Groups also provide content and support to the Sustainability Committee within the framework of their responsibilities.

The Sustainability Committee brings relevant issues to the agenda of the existing Corporate Governance Committee and ensures that they are reported to the Board of Directors.

The Sustainability Committee convened on March 21, and work on the determined actions was carried out by the relevant groups.

Working Groups 

Working groups are responsible for determining the steps for the implementation of already designed actions, conducting budget and feasibility studies, and obtaining the necessary approvals. In addition to the value areas within the Strategic Framework, a fourth working group will be included in the system that will study integrated risk management, corporate governance, ethics and transparent business under the Strategic Foundations.

In addition to being responsible for determining its own functioning, each working group should determine the frequency of meetings and job descriptions in order to be able to effectively report to the Sustainability Committee meetings that are planned to be held every quarter. In the ESG strategy development process, the working groups will be responsible for the design and implementation of the actions to achieve the determined strategic goals, as well as the implementation of the actions determined by the outputs of the Vigeo Eiris assessment and Current Situation Analysis. The Action Framework that each working group can follow is defined in the tables in the annexes of this report. Actions to be defined within this framework will facilitate the achievement of goals. Working groups will add new items to these frameworks and determine the strategic direction.

Structure of B of D (Board of Directors)

Zorlu Enerji Board members are elected every year during the General Assembly meeting. The Board of Directors is diverse in terms of independent membership and gender. The diversity development of the Board of Directors can be seen in the charts below:

Membership backgrounds of the members of the Board of Directors differ. As of 2020, 2 members of the board have been continuing their membership since 1993. While 5 members have been on the board for less than 5 years, 2 members have a membership experience of 10-20 years.

While the meetings of the board differ according to the year, the participation rates reached at the meetings also change.

In line with the Capital Markets Board's Corporate Governance Principles, a Corporate Governance Committee, an Early Detection of Risk Committee and an Audit Committee have been established to work under the Board of Directors in order to ensure that the duties and responsibilities of the Board of Directors are carried out in a healthy manner at Zorlu Enerji. The membership structures of these committees are as follows:

  • Corporate Governance Committee
Duty Title
Head of Committee Independent B of D Member 
Member Non executive B of D Member 
Member Investor Relations Manager
  • Early Detection of Risk Committee
Duty Title
Head of Committee Independent B of D Member 
Member Non executive B of D Member 
  • Audit Committee
Duty Title
Head of Committee Independent B of D Member 
Member Independent B of D Member 

At Zorlu Enerji, internal audits are carried out through periodic meetings between the Internal Audit Department and the Audit Committee. In these meetings, the planned and realized audit and consultancy activities are evaluated, the steps to be taken regarding the findings encountered are determined and the plans for the next period are reviewed.

Zorlu Enerji Internal Audit Team is in development in terms of skills and competencies. The change of the team on the basis of the number of people is shown in the chart below: