The energy sector is facing complex challenges of decarbonisation, reliability, and affordability. More broadly, public trust in institutions such as business continues to decline³. Despite these challenges, we are committed to taking a leading role in issues that affect our stakeholders and society more broadly.

Affordable energy

As a provider of an essential service, we recognise that energy must be affordable for it to be sustainable. We appreciate that it is important to all our customers that we provide them with cost-effective energy and information to empower them to make informed decisions about their energy usage.

We know that for many Australian households that are impacted by increasing costs of living, energy prices can have an acute impact on their livelihoods. That’s why we’ve been taking an active role in partnership with customer advocacy groups, governments, and civil society to develop measures that will assist with energy affordability for our customers. Visit the Energy prices and affordability section for further information.

Leadership on climate action

The electricity sector has an important role to play in helping Australia meet its emission reduction targets and long-term commitments under the Paris Agreement. As Australia’s largest scope 1 (direct⁴) greenhouse gas emitting business and given that emissions from Australia’s electricity generation sector comprise around one-third of Australia’s total emissions inventory, we have a key role to play in gradually reducing greenhouse gas emissions while providing secure and affordable energy for Australian households and businesses. In FY18, we continued to demonstrate our leadership on climate action through the release of our Powering a climate resilient economy report, which was developed in accordance with the recommendations of the Financial Stability Board’s Taskforce on Climate-related Financial Disclosures (TCFD). Read more about our strategic approach to decarbonisation in our Transition to low carbon energy section.

A key aspect of decarbonisation of the energy sector is the transition from older, fossil-fuel burning power generation sources to newer, lower carbon-emitting technologies. We recognise that closure of longstanding power generation assets is likely to have concentrated impacts on those communities where those power stations and related mining activities are based. That’s why we’re working in partnership with local communities, governments and other parts of industry to plan for power station closure and repurposing to catalyse the broader social, economic and environmental transition of these regions. Visit the Power station transition and closure section for further details.

Investing for a decarbonised sector

We are proud to be Australia’s largest ASX-listed investor in renewable energy generation, having already invested over $3 billion in renewables since 2005. Key to meeting our strategic imperative of prospering in a carbon-constrained future, we are committed to continuing to play a leading role in developing a pathway to a modern, decarbonised generation sector. In December 2017, we released our NSW Generation Plan, which sets out our plan to replace our ageing Liddell Power Station with lower-carbon emitting generation sources, affordably and reliably. For further details on our renewable energy portfolio, visit the Renewable energy section.

We also continue to focus our investments on distributed generation and new technology such as batteries, smart inverters, smart appliances, as well as energy efficiency for commercial and industrial customers, assisting them to improve their energy productivity and minimise their energy costs and associated greenhouse gas emissions. For more information on the innovative products and services we are offering customers, see the Product innovation section of this report.

Leading the energy market transformation

In line with our strategic objective of becoming an orchestrator of large and small assets, we are embracing innovation in behind-the-meter technologies, partnering with government and peers in the energy sector, and driving the uptake of distributed energy resources to unlock growth in orchestration technologies. Visit the Customer-led approach and delivery and Product innovation sections for details of the range of initiatives we are investing in.

We continue to prioritise engaging with our stakeholders to address the issues raised by Australia’s energy transformation, as illustrated by our commitments to innovation and ongoing engagement with government about public policy. Visit our Energy market evolution section for full details on our vision for the transformation of the energy, and our Public policy engagement section for details on how we engage with policy-makers to deliver sensible energy policy outcomes.

Social and economic inclusion

As a provider of an essential service, we are also shining a spotlight on the increasing social and economic inequality in Australian society. As we contend in our 2017 Social and Economic Inclusion report, business and civil society must work together with government to ensure that evidence-based policy continues to deliver more equitable opportunities for all citizens to engage fully in the Australian economy and society, and address the risks of workforce transformation, inequality and disadvantage. 

Since releasing our Social and Economic Inclusion report, we have been developing our own Social and Economic Inclusion Policy. Much like the AGL Greenhouse Gas Policy it will outline both the commitments we intend to make over the long term to improve our business operations on behalf of our customers, as well as the key components of our approach to public policy advocacy on this important issue.

Leadership on other social issues

We recognise the importance of business to engage in the social issues that affect our people and our customers. We are proud that AGL has taken a leading stand on issues such as diversity and inclusion, marriage equality, and domestic violence.

Gender equality is a basic human right and forms a central part of our Diversity and Inclusion Policy. This policy underpins our belief that diversity in the backgrounds and perspectives of our people enables our company to have a better understanding of our customers and a greater ability to engage genuinely in the communities in which we work, which also leads to better business outcomes.

Consistent with our support of diversity in the workforce, in 2017 we pledged our support for changing Australia’s marriage laws to provide equal rights for all Australians. Our position was strongly endorsed by AGL’s Board, our CEO, senior management and our LGBTI employee inclusion network, ‘AGL Shine’.

In recognition that individuals, organisations and communities must play a role in supporting people impacted by family and domestic violence, in 2015 we introduced our Family and Domestic Violence Support Policy. Endorsed by our CEO and Managing Director, this policy provides affected AGL people with up to 10 days paid Domestic Violence Leave, along with flexible work arrangements and access to counselling services through AGL's Employee Assistance Program. In 2017, we also established a working group to engender a safe and supportive workplace for our people affected by family and domestic violence.

This year, AGL has been providing training to all AGL leaders and employees on this important issue, and has expanded the support available to employees through providing a dedicated Family and Domestic Violence Helpline.

In FY18 we continued on our journey towards increased employee engagement with indigenous issues. Our Indigenous Engagement Working Group is leading the way, with the aims of:

• increasing awareness and appreciation of indigenous culture across AGL
• creating a sense of inclusion and cultural safety for indigenous employees and employees interested in indigenous affairs, and
• growing employee-based support for AGL to make a public commitment to support reconciliation and resource accordingly.

Over FY19 we will continue our progress on developing an indigenous Reconciliation Action Plan (RAP) in collaboration with Reconciliation Australia.

Read more about our approach to diversity and inclusion in our Workplace culture and talent section.

FY18 Performance

Recognising the importance of good corporate conduct and leadership relating to issues that matter to our stakeholders, for FY18 we set ourselves a target to be one of the top 30 companies in Australia as listed in the RepTrak reputation survey. Disappointingly, at the end of FY18, we achieved a RepTrak ranking of 47th. However, improving our reputation score remains a focus for us over FY19, and we have retained this as one of our targets for FY19.

Related information

• Supplementary Report (FY17): Social and Economic Inclusion report
• Diversity and Inclusion Policy
• AGL Greenhouse Gas Policy
• Supplementary Report (FY18): Powering a Climate Resilient Economy report