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Materiality and stakeholder engagement

Eni’s materiality definition process

Materiality is the result of the identification, evaluation and prioritization of the relevant sustainability issues that impact significantly the company’s ability to create value in the short, medium and long-term.

The materiality process is based on the analysis of three steps:

  • CEO’s guidelines for preparation of the four-year strategic plan;
  • the potential ESG risks, identified by the internal risk assessment;
  • the evaluation of the main requests promoted by the stakeholders on sustainability issues.
Eni’s materiality definition process (graphic)

The combination of the results of the three previous assessments allowed to identify the 2016 relevant issues:

  • integrity in business management (transparency, anti-corruption);
  • safety of the people and asset integrity;
  • human rights and equal opportunities for all people;
  • combating climate change (GHG reduction, energy efficiency, renewable energies) and reduction of environmental impact (protection of water resources, biodiversity, oil spill prevention);
  • local development/local content and promotion of access to energy;
  • technological innovation.

Business model

Eni’s business model targets long-term value creation by delivering on profitability and growth, efficiency, operational excellence and handling operational risks of its businesses.

Eni identifies as main challenge of the energy industry the balance between the maximization of the access to energy and the fight against the climate change, which necessarily involves a change in the energy mix, through the reduction of carbon footprint.

The answer of Eni to this challenge is the integrated strategy that combines financial strength with social and environmental sustainability, articulated on the following critical success factors: i) the cooperation and development model relating to the Countries in which Eni operates. Eni’s commitment is addressed to the energy production for domestic market, the diffusion of the access to energy and diversification of the energy mix; ii) the operating model able to minimize risks and the social and environmental impacts of the activities; iii) a clear and defined strategy of decarbonization.

The environmental conservation and relationships with local communities, the fight against the climate change, the preservation of health and safety of people working in Eni and with Eni, the respect of human rights, ethics and transparency represent the fundamental values which address the use of Eni’s distinctive assets.

In the following page, the table provides details about our distinctive assets, analyzed on the basis of financial, operational, environmental, technological, human, social and relational dimensions, in order to identify the related quantitative parameters (KPIs). These KPIs allow a continuous monitoring of the target achievement and the identification of the intervention areas by pursuing the strategic guidelines that allow, in an increasingly complex scenario, to optimize and anticipate the value creation.

The benefits for the company and stakeholders are highlighted as result of the use of our assets and their related connections.

Business model (graphic)

Strategy 2017-2020

Scenario and Performance

An international environment characterized by oversupply and low prices, the ongoing transformations in the European mid-downstream businesses and the process of decarbonization in the energy system, represent the main challenges faced by the oil companies. The surplus in supply and the downward dynamic on prices continue to require a strategy of capex rationalization, addressed to projects with lower break-even and initiatives finalized to cost reduction.

To achieve the target of limiting global temperature increase, natural gas will play a central role as main full alternative to carbon.

Efficient and valuable growth (graphic)

Efficient and valuable growth

Transformation (graphic)


Mid-downstream restructuring (graphic)

Mid-downstream restructuring


Industrial Plan

At the end of 2016, as a result of the production cut agreement, Brent price returned to rise, recording a value of approximately 55 $/bbl. Eni’s industrial plan is incorporating a Brent scenario of 55 $/bbl in 2017 and a gradual recovery in the subsequent years, up to long-term case of 70 $/bbl in 2020, following the progressive rebalancing of the market.

The main goal of Eni’s growth strategy is to build a high-margin cash portfolio and will be pursued through the following levers:

the portfolio consolidation through high impact exploration activity on conventional basins, in proximity of existing facilities and not far from the final market

the development of projects with a “design to cost” approach, aimed to accelerate production start-ups and reduce financial exposure

the maximization of value through the integration of our portfolio with gas marketing activities (with a more relevant role played by LNG), the improvement of mid-downstream businesses and the active management of portfolio based on Dual Exploration Model

2017-2020 targets

Capex cash neutrality

In 2017 organic cash neutrality (capex and dividend) at 60 $/bbl, for 2018-20 period < 60 $/bbl

Capex down by 8% vs previous plan at constant exchange rate

€31.6 bln

in the four years

Asset disposal program

€5-7 bln

GHG emissions in upstream

down by


within 2025

Zero routine flaring by 2025

Maintenance of project portfolio with a low CO2 emission profile

Our path to long term value

Targets, risks and treatment measures

In this section, Eni’s top risks are presented with regard to the Company’s targets. For a detailed description of these risks, or, in addition, for further less relevant uncertainties factors, see the section “Risk factors and uncertainties”.


Integrity and transparency are the principles that have inspired Eni in designing its corporate governance system1, a key pillar of the Company’s business model. The governance system, flanking our business strategy, is intended to support the relationship of trust between Eni and its stakeholders and to help achieve our business goals, creating sustainable value for the long-term.

Eni is committed to building a corporate governance system founded on excellence in our open dialogue with the market and all our stakeholders.

Ongoing, transparent communication with stakeholders is an essential tool for better understanding their needs. It is part of our efforts to ensure the effective exercise of shareholder rights.

With this in mind, recognising the need for a deeper dialogue with the market, in 2016 Eni organised a new cycle of corporate governance roadshows involving the Chairman of the Board of Directors with the main institutional investors of Eni to present the Company’s governance system and main initiatives in the fields of sustainability and corporate social responsibility. The initiative was much appreciated by the investors, who welcomed the open and constructive dialogue forged with the Company. In particular, the investors applauded the composition of the Board of Directors, including its diversity, the governance measures adopted and the completeness and transparency of the information provided to shareholders and the market as a whole. In addition, during the meetings the investors displayed considerable interest in developments in the governance of risks and the control system, the associated organisational arrangements and the leading role reserved for the Board and the Chairman in the system. Additional corporate governance events were held in early 2017.

(1) For more detailed information on the Eni Corporate Governance system, please see the Report on corporate governance and ownership structure, which is published on the Company’s website in the Governance section.

The Eni Corporate Governance structure

Company's corporate governance structure (graphic)

a – Member appointed from the majority list, non-executive and independent pursuant to law.
b – Member appointed from the majority list.
c – Member appointed from the majority list and independent pursuant to law and Corporate Governance Code.
d – Member appointed from the minority list and independent pursuant to law and Corporate Governance Code.
e – He is independent pursuant to law and Corporate Governance Code, being co-opted by the Board on July 29, 2015, in the place of the Director
Luigi Zingales who had resigned from the Board on July 2, 2015, and confirmed as Director by the Shareholders’ Meeting on May 12, 2016.
f – External member.
g – Senior Executive Vice President Legal Affairs.
h – Executive Vice President Integrated Compliance.
i – Senior Executive Vice President Internal Audit.
l – Executive Vice President Labour Law and Dispute.
m – On July 28, 2016, the Eni Board of Directors approved the rotation of Director Karina Litvack out of the Control and Risk Committee with another Director selected by the Board itself on September 15, 2016 in the person of Director Diva Moriani. Moriani left the Compensation Committee effective as of December 22, 2016.
* Also Senior Executive Vice President Corporate Affairs and Governance.
** The following are Alternate Auditors:
Stefania Bettoni - Member appointed from the majority list.
Mauro Lonardo - Member appointed from the minority list.