Table of contents
- Introduction
- Climate strategy
- Shale gas
- Biodiversity
- Air pollution
- Water pollution
- Human rights
- Value sharing
- Business conduct
Introduction
Climate change is one of the biggest challenges facing society in general – and ENGIE in particular. To rise to this challenge, the Group has implemented a greenhouse gas (GHG) reduction program, a climate vigilance plan, a natural resources savings program and, lastly, a business model adjustment program to build its resilience to climate change while taking into account the imperatives of a just transition.
Unanimously adopted by our shareholders in May 2020, the Group’s purpose statement offers a clear framework for our strategic decisions in this field.
Building on its purpose statement, the Group has also set itself ambitious non-financial targets for 2030 in order to meet its Environment, Social and Governance (ESG) commitments within this timeframe. These targets are part of a continuous improvement approach designed to meet a growing demand from its stakeholders. They not only require the company to meet its legal and regulatory obligations in various fields of ESG, but also primarily to adopt best practices to optimize its ability to anticipate and control the impact of its activities on its sphere of influence, and vice versa. The Group’s ESG commitments and policies aim to satisfy the demands of all stakeholders.
ENGIE is also committed to carrying out its activities in full respect of internationally recognized human rights wherever the Group operates. The Group’s commitments reflect the risk of human rights violations potentially caused by the Group’s activities – either directly or as a result of its business relationships.
Despite these efforts, the Group’s activities and projects may give rise to questions from its stakeholders.
ENGIE has decided to take the initiative and respond publicly to these questions. The examples cited below demonstrate the importance given to ESG-related issues and implemented action plans, and the Group’s transparency on these topics.
Climate strategy
Group strategy
Besides its plan to exit coal by 2025 for Continental Europe and 2027 for the rest of the world, which is currently being carried out, the Group was one of the first energy companies, in February 2020, to have its 2020-2030 development plan certified compliant with the Paris Agreement by the global Sciences Based Targets initiative (SBTi), in line with 2°C warming.
Since then, ENGIE has raised the bar by committing, in May 2021, to the "Net Zero Carbon" objective by 2045, for all its direct and indirect emissions, which is extremely ambitious. This objective will be achieved by following a “well below 2°C” trajectory, certified by SBTi in 2023, till 2030. ENGIE’s decarbonization trajectory till 2045 was given an NZ-2 assessment by Moody’s, consistent with a 1.5°C ambition and with a solid implementation assessment.
Questions raised by some stakeholders
Questioning by the NGO “Notre Affaire à Tous”
Since 2020, the NGO “Notre Affaire à Tous” has been publishing a climate vigilance benchmark of 25 French multinationals, and has called out ENGIE’s climate strategy. In 2025, ENGIE was given a score of 35/100.
ENGIE’s Net Zero Assessment, an independent report by the rating agency Moody’s published in February 2024, details and analyzes all of ENGIE’s climate objectives. As such, it provides an answer to the main points raised by the NGO, confirming the alignment of ENGIE’s climate strategy with a +1.5°C trajectory, and assessing ENGIE’s implementation as “solid” and its governance as “Tier 1” (best possible score).
Exchange with the NGO “Ember Climate”
In March 2020, the British NGO “Ember Climate” published a critique of ENGIE's decarbonization plan, alleging a lack of ambition from the Group towards the Paris Agreement and an absence of a decarbonization strategy. Ember Climate also highlighted the lack of precision in the Group's strategy to close coal-fired power plants and its bias towards gas.
In its Climate Notebook, the latest version of which was published in 2024, ENGIE details its strategy and action plan to achieve its Net Zero Carbon target by 2045. In line with all its publications since 2021, ENGIE confirms its intention to phase out coal by 2025 in continental Europe and by 2027 in the rest of the world; the Group is prioritizing first the closure of these sites, then their conversion, and finally their sale to an energy player selected on the basis of its social responsibility.
Questioning by the NGO “Reclaim Finance”
In February 2024, the French NGO “Reclaim Finance” denounced the Nijmegen gas power plant project in the Netherlands, presented as incompatible with the Group's Net Zero Carbon trajectory.
As a reminder, ENGIE closed a coal-fired power plant near the Meuse-Waal canal in Nijmegen in 2015. As part of the Waal Energy rehabilitation project, a hydrogen charging station and a 250 MW battery storage system could be installed. The possibility of building a progressively decarbonized thermal power plant has been considered, which would enable the Netherlands to ensure the country's security of electricity supply. ENGIE presented these projects with its three main partners (Industry park TPN West, ZES and Energy Hub Nijmegen) to the Nijmegen city council, as well as to two associations (Extinction Rebellion and Milieudefensie) opposed to the project.
On January 31, 2024, the city council voted in favor of amending the zoning to allow for such projects in the future. However, ENGIE points out that these projects are currently at the preliminary study stage and that no investment decision has been taken yet; ENGIE will remain attentive to keeping the dialogue going with all of the project’s stakeholders.
Shale gas
Group policy
ENGIE is not a gas producer. As an actor in the gas value chain, the Group is a network operator and an energy supplier that transports and distributes gas for direct use by its clients or to be transformed into electricity in its thermal power plants. ENGIE therefore plays a key role in the security of energy supply in the areas where it operates.
As a result, the Group must diversify its sources of supply in order to guarantee a resilience of gas supply. Tensions in energy markets as early as December 2021, which continued into 2022 and 2023 with Russia's war in Ukraine, made our strategy to diversify sources of supply all the more relevant. Historically, Russian gas accounted for around 40% of European supplies (half as much in France which, for historical and geographical reasons, has a more diversified energy mix, with Norwegian, Dutch and Algerian contracts). This diversification strategy is based on a portfolio of long-term contracts including liquefied natural gas (LNG). In this regard, like all the main players in Europe and France in particular, ENGIE acquires US gas from local players.
Since the 2022-2023 winter, these new sources of supply, combined with an expected reduction in demand, have allowed us to fully replace pipeline gas from Russia and reach the required storage levels at the start of winter. Long-term US LNG contracts are signed with producers which made commitments in terms of traceability of emissions and environmental monitoring of their activities. In 2024, ENGIE joined the Gas Programme of the international organization RECOSI (Responsible Commodities Sourcing Initiative).
Based on internal data available to date and related to the entire lifecycle from extraction to combustion, the emissions surplus between LNG from the United States and natural gas from Russia is estimated at around 10%. The methodology used by the Group for the calculation of GHG emissions of the upstream value chain of natural gas was validated by Bureau Veritas in February 2025, based on the ISO 14067:2018 standard.
These contracts are compatible with the Group's carbon trajectory. They do not call into question the Group's ability to achieve its Net Zero target by 2045, nor its greenhouse gas emission objectives for 2030, and will expire before 2045.
A closer look at the Cheniere contract
ENGIE signed a contract for the supply of LNG with US company Cheniere Energy, Inc. ("Cheniere") which began in September 2021. Given current security of supply challenges, ENGIE decided to extend the term of the contract. ENGIE increased the volumes and extended the contract by agreeing to purchase approximately 0.9 million tons per annum of LNG for a term of approximately 20 years.
Cheniere has made a clear commitment to transparency, the traceability of the carbon content of its gas supply chain and continuous improvement of its management of methane and carbon dioxide emissions. Cheniere’s annual CSR report includes more than 70 environmental performance indicators based on the best international standards, including the Global Reporting Initiative (GRI), the Sustainability Accounting Standards Board (SASB), and the Task Force on Climate-Related Financial Disclosures (TCFD).
Cheniere brings transparency to its gas supplies by providing ENGIE with data on the greenhouse gas ("GHG") emissions of each LNG shipment produced in the company’s liquefaction facilities in Sabine Pass and Corpus Christi.
A closer look at the NextDecade contract
ENGIE and US company NextDecade Corporation ("NextDecade”) signed a 15-year agreement for the sale and purchase of 1.75 million tonnes per annum of LNG from its Rio Grande LNG export project in Brownsville, Texas (USA).
The agreement, with the first train expected to start commercial operations as early as 2026, was signed after lengthy discussions with NextDecade focusing on its social and environmental performance.
NextDecade plans to use carbon capture and storage (CCS) technology to reduce greenhouse gas emissions by about 90% at its liquefied natural gas (LNG) export project. NextDecade also plans to use net-zero energy at its Rio Grande project to minimize its Scope 2 emissions.
In addition, NextDecade intends to use ESG certified gas sourced from the Permian Basin and Eagle Ford Shale. This gas is a natural gas that has been certified by a third party which ensures it is sourced through environmentally responsible procurement practices, based on standards covering air emissions, water stewardship, land use and community impacts. In particular, ESG certified gas is produced with lower methane emissions.
Lastly, NextDecade has announced plans for a pilot project for monitoring, reporting and certification of the GHG intensity of the LNG to be sold from its Rio Grande LNG export facility.
With regard to our commitments, these contracts do not call into question the Group's ability to achieve its Net Zero target by 2045, nor its greenhouse gas emission objectives for 2030. These contracts expire before 2045. In the meantime, they offer the Group the flexibility to reroute these volumes.
Based on available data, our best view to date is that the average level of emissions from LNG transported to France from the USA is comparable (about 10% difference in emissions from extraction to combustion) to the average level of emissions from gas transported from Russia by land.
These contracts are part of a broader strategy of renewing the natural gas supply portfolio, which is compatible with a decreasing demand for natural gas in Europe by 2045 (the extent of the decrease remaining subject to uncertainty given the context). This strategy also includes the mobilization of additional volumes from the North Sea, which are efficient in terms of greenhouse gas emissions.
A closer look at the Sempra contract
ENGIE has signed a contract with Port Arthur LNG Phase 1, an affiliate of Sempra Infrastructure, for the delivery of LNG for 15 years which contemplates procuring natural gas certified by an independent third party in accordance with applicable ESG performance criteria.
The agreement also provides a framework to explore ways to reduce the carbon intensity of LNG produced from Port Arthur LNG Phase 1 through greenhouse gas emission reduction and mitigation strategies and a continuous improvement approach
Biodiversity
Group strategy
Biodiversity (fauna and flora) constitutes a natural heritage essential to human well-being and health. ENGIE also depends on biodiversity for its use of biomass resources and for water and climate regulation.
Biodiversity is at risk from climate change, pollution, habitat alteration, the invasion of alien species and the overexploitation of resources. The fragmentation and disruption of habitats caused by the footprint of our facilities and soil sealing are the principal ways ENGIE’s activities impact on biodiversity.
Aware of its responsibilities and the challenges it faces, ENGIE has developed, in consultation with leading experts, the International Union for Conservation of Nature (IUCN) and FNE (France Nature Environnement), a biodiversity policy which includes the follow-up of a site-by-site status report on the impact of activities at monitored industrial facilities and the development of action plans produced in consultation with stakeholders for priority sites. In February 2020, the Group set itself a more ambitious target: the implementation of an environmental management objective by 2030 – in other words, a biodiversity plan for all the Group’s industrial sites.
ENGIE is committed to biodiversity within the framework of act4nature international, a voluntary biodiversity initiative launched by the Association Française des Entreprises pour l’Environnement (EpE) and multiple other partners in 2018. it encourages companies to take action on their direct and indirect impacts, their dependencies, and their potential to make a positive contribution to nature. This alliance between businesses, public authorities, scientists and environmental organizations aims to build a global and collective momentum to protect, promote and restore biodiversity, including by involving CEOs from every sector in their initiative. The hope is that their interest legitimizes biodiversity in the eyes of all their employees and partners, as well as actors in their value chains, and as a result incentivizes local “bottom-up” actions.
Unlike climate change, biodiversity is essentially a local issue requiring systematic vigilance in the field for each site in operation and each project under development. It also calls for specific skills from outside the company and a strong ability to engage in dialogue with civil society. This occasionally gives rise to local problems which the Group endeavors to resolve using its extensive expertise in the field.
Learn more about the Group’s environmental policy.
Questions raised by our stakeholders
Discussion on the construction of a transmission line in Brazil (Gralha Azul project)
On October 16, 2020, a Brazilian court suspended the environmental licenses and construction works of a section of an electric power transmission line over a stretch of 1000 km in the State of Paraná for failing to respect the vegetation of an Atlantic forest in a protected area, and ordered their review.
On December 9, 2020, the Brazilian Supreme Court of Appeal revoked the injunction of the federal court, allowing the works to resume. In June 2022, the Superior Court of Justice ruled that the suspension of the environmental licenses and construction works had no legal basis. The line was brought into commercial operation in August 2021, 18 months before the date set out in the concession agreement.
Drone technology was used on the Gralha Azul transmission line to lay cables for over 1000 kilometers of electric power lines, which reduced its environmental impact, optimized costs and increased the safety of workers. This initiative prevented the clearance of service areas at least four meters wide through large swathes of vegetation for cable-dragging by heavy machinery. The use of drones to lay electric cables also reduced the impact on fauna by limiting vegetation clearance between towers, thereby protecting the indigenous forest. The large-scale use of this technology is a pioneering initiative in Brazil, and should be replicated on other similar projects that the Group develops elsewhere.
Other measures were taken to minimize the environmental impact of the project, such as an in-depth study to determine the route of the transmission line: some 70% of this route runs through areas already disturbed by human activity, in other words, pastureland and farmland; access to the towers was designed to coincide with the internal accessways of properties impacted by the route; wherever possible, higher towers were used, further reducing the need to clear vegetation.
Air pollution
Group strategy
In addition to GHG (greenhouse gas) emissions that contribute to a global phenomenon, some gases cause air pollution that can have a potentially serious impact locally on human health and ecosystems.
As a consequence, for a number of years the Group has implemented environmental reporting audited annually by a statutory auditor, the Commissaires aux comptes, in order to monitor local regulations governing these pollutants and to produce centralized reports on the three main causes of air pollution generated by the burning of fossil fuels (gas, coal, fuel oil and alternative fuels), biogas or biomass:
- nitrogen oxides (NOx = NO + NO2) expressed as NO2 equivalents
- sulfur dioxide (SO2)
- airborne particles or particulate matter (PM)
These three pollutants are a major public health issue, particularly in towns and cities, which may occasionally put constraints on nearby production facilities.
Questions raised by our stakeholders
Conversion of the Hazelwood power station and mine in Australia
In February 2014, embers from a bushfire in the Latrobe Valley of Victoria, Australia, started a series of spot fires in a nearby open cut mine next to the Hazelwood Power Station. These fires, which were not caused by ENGIE, proved very difficult to put out in extreme conditions and continued to burn for 45 days.
Built in 1964, the Hazelwood Power Station had reached the end of its operational life-time and could not be upgraded according to appropriate standards. This situation, combined with ENGIE’s strategy of exiting coal-fired power generation, led to the decision to close the power station from March 2017.
Since then, ENGIE and its Hazelwood joint venture partner Mitsui have been carrying out a major project to dismantle and rehabilitate the open-cut mine, the power plant, and surrounding land, in order to create a safe, stable, sustainable and non-polluting landform.
With demolition of the power station and mining equipment completed in 2022, the focus of rehabilitation works is gaining the necessary regulatory and government approvals to fill the mine void, in order to help manage the long-term residual risks of ground stability and fire.
To this end, ENGIE is working through a State-based Environmental Effects Statement (EES) process in connection with this proposal, with extensive community engagement and expert technical study programs designed to identify and manage the impacts of ENGIE’s preferred approach to a final landform. This EES process runs in tandem with Australian Federal Government regulations known as Environment Protection and Biodiversity Conservation Act (EPBC). ENGIE’s technical study program takes both government processes into account.
This approach and the Rehabilitation Project generally are subject to ongoing debate and commentary on topics including water availability, management of an ash dam located in the mine void, and impact on downstream ecosystems.
Another example of ENGIE’s commitment to energy transition in the Latrobe Valley is the construction of a 150 MW Hybrid Battery Energy Storage System (HBESS) on the site of the former Hazelwood plant, which began operation in 2023. The HBESS has the capacity to store the energy equivalent of an hour of energy generation from the rooftop solar systems of 30,000 Victorian homes, playing a critical role in increasing the state’s energy capacity and delivering further grid stability.
Water pollution
Group strategy
Aware of the importance of this resource and due the very nature of its industrial processes, ENGIE pays particular attention to the management of water and marine resources. The Group pays special attention to the issues of quality and available quantities of this resource, in a context of increasing drought periods related to climate change. For more than 10 years, ENGIE has been committed to the issue of water, notably by contributing to international initiatives such as the United Nations’ CEO Water Mandate. The Group continues to make operational commitments on the matter, particularly by limiting the water used in energy production.
ENGIE is also interested in the protection of marine resources. Indeed, the oceans, key elements for carbon capture, are threatened by human activity. The Group's activities depend on climate regulation and the key role of the oceans in this matter. The Group has therefore committed to the preservation of the oceans through the United Nations’ Sustainable Ocean Principles.
To learn more about the Group's commitments and strategy on water, ENGIE updated its Water and Oceans policy in 2024.
Questions raised by our stakeholders
Flow problem related to a hydroelectric dam on the Laja River in Chile
In February 2024, the Chilean Environmental Court requested ENGIE to take measures to mitigate the potential impacts of the Laja hydroelectric power plant, operated by ENGIE’s subsidiary Eolica Monte Redondo, on local communities, their economic activities, and the quality of the water available near the river. ENGIE has complied with this decision by submitting a remedial plan within the prescribed timeframe, which is currently under validation by the public authorities.
Since the start of its operation in 2014, the power plant has complied with all the provisions of the Environmental Qualification Resolution (Resolución de Calificación Ambiental, RCA). To this end, ENGIE periodically requests water quality analyses from environmental inspectors, in the presence of representatives from the La Aguada and Puente Perales sectors, and the regional representative of the Ministry of Health for the Biobío region.
The results of these analyses are communicated to the environmental authorities and local communities, also involved in this monitoring process. The Group has sought to maintain and facilitate a constant dialogue with local communities, and in the same spirit has organized roundtable discussions on the transparency of its operational activities in the presence of local representatives.
In this way, ENGIE contributes to local development and dialogue with stakeholders, particularly small companies and social organizations.
Human rights
Group strategy on human rights
To ensure compliance with all its human rights commitments and to meet French and international requirements, the Group relies on different policies, either transversal or specific to certain issues, and in particular on the Duty of Vigilance Policy - Human Rights. The Health and Safety, ESG and Procurement policies complement the human rights policy, covering specific commitments that fall within their particular scope.
Questions raised by our stakeholders
Supplies of photovoltaic panels from Xinjiang, China
ENGIE, leader in the energy transition, develops, installs and operates carbon-free energy production solutions, which include photovoltaic panels. China, which within the last decade has become the world’s main supplier of photovoltaic panels, sources most of its raw material (polysilicon) from Xinjiang, a region in the far west of China. In recent years, multiple investigations have highlighted the repression and grave violations of the fundamental freedoms of the Uyghurs. As the fate of the Uyghurs moves to the center of international debate and places a question mark over the import of products from the Xinjiang region of China, the solar energy industrial sector is working hard to make its supply chain more transparent.
ENGIE has pledged to monitor respect of its commitments on human rights. ENGIE endeavors to engage in a dialogue with its suppliers to promote and uphold its commitments and to improve the transparency of the supply chain.
ENGIE experts implement preventive actions to address ethical, reputational and financial risks: ENGIE continuously assesses, selects and inspects its subcontractors, including through increasingly advanced ethical risk analyses.
ENGIE is therefore committed to:
- Ensure respect for the rights of workers under international law and take an active role in ensuring our suppliers do not use forced labor, across the whole supply chain.
- Systematically implement advanced “due diligence” (inspections) with suppliers prior to signing all contracts, particularly if they are likely to have links with the Xinjiang region.
- Listen to civil society organizations to adapt as quickly as possible to the reality of the human rights situation and to continuously strengthen compliance with ethical standards.
- Require suppliers to provide information on who they work with and where, across the whole supply chain; talk directly and regularly with our suppliers about respect for human rights.
- Use independent experts to fully investigate respect for human rights by our suppliers.
- Require our suppliers to commit in writing not to use forced labor, particularly in the Xinjiang region. All our contracts also include clauses that allow us to terminate the contract if our suppliers – and their subcontractors – fail to comply with their obligations, particularly the ban on forced labor.
- Take the necessary measures – which can go as far as termination of the contract – if it turns out that there is a risk of being associated with forced labor or any violation of human rights, or in the absence of alignment with the Group Procurement's Ethics and Sustainable Development clause.
- Furthermore, as a member of Solar Power Europe, ENGIE joined the Solar Stewardship initiative launched in October 2023, which aims to develop a responsible, transparent, and sustainable solar value chain, enhancing trust in how solar products are manufactured, regardless of the location or manufacturer. This ensures that companies and consumers can be confident that their solar products comply with international ESG standards.
Procurement by GEMS of Colombian coal
In April 2023, a complaint was filed by NGOs with the OECDS’ Dutch National Contact Point against ENGIE and other companies, alleging that the companies did not meet the standards expected of them by the OECD Guidelines for Multinational Enterprises regarding serious acts that allegedly took place in certain production areas of the Group's former coal suppliers in Colombia. ENGIE fully cooperated in this investigation.
ENGIE points out that in 2012 the Group, along with other energy sector companies, initiated Bettercoal (for the continuous improvement of practices by coal producers and buyers worldwide). This initiative, coupled with field visits (notably in Colombia), has encouraged key stakeholders to work with authorities and civil society on these human rights issues.
In 2024, the complainants decided to withdraw the complaint against ENGIE.
Value sharing
Group strategy
ENGIE is particularly committed to sharing the value created by its activities among its main internal and external stakeholders. It aims to lead the energy transition in a fair manner, i.e. equitably, and has adopted a just transition policy complemented by objectives and indicators based on four axes: customers, territories, employees, and suppliers
Questions raised by our stakeholders
Exchange with the NGO “Oxfam France”
In 2023, the NGO Oxfam France published two reports criticizing ENGIE for the excessive remuneration of its executives and the prioritization of dividends over investments. These publications were followed by exchanges with this NGO.
Regarding executive remuneration, ENGIE is particularly attentive to adhering to the best market practices and has adjusted its annual variable and long-term incentive remunerations by incorporating ESG criteria for all senior executives, as illustrated below for the year 2023.
