ARX:

Our Approach to ESG

Global energy needs are evolving, with overall demand expected to increase amid a transition to a lower carbon economy. ARC has both the responsibility and opportunity to successfully meet these energy needs both today and into the future by safeguarding its ESG strategies and practices and generating strong returns.

ARC has developed a strong reputation among its stakeholders that is built on trust; ARC’s energy speaks to the passion and commitment to doing what is right through the choices we make, how employees act as individuals, and how they engage with one another. What ARC creates are results, through work and through action. ARC strives to contribute to a better world and everything we do is to promote a thriving environment, prosperous community, and a better quality of life for all.

ARC strives to deliver industry-leading performance in all aspects of its business. ARC has built a culture that fosters responsible resource development to deliver strong financial and operational results by prioritizing environmental and social responsibility efforts. Strong governance practices and an ongoing commitment from employees is critical in ARC delivering on this purpose.

To guide the Company’s efforts, ARC has developed an ESG framework that examines the key risks and opportunities to the organization, as well as contemplates the larger purpose that the Company serves in creating a better world for everyone. The framework outlines guiding principles, core commitments, and measurable, ESG-specific goals and targets.

ESG Framework

  • Environment

    ARC is committed to carrying out its operations in a manner that reduces harmful impacts to the environment, and believes that the most effective response for ARC to combat climate change is to produce energy that generates the least GHG emissions possible. ARC is committed to continue reducing its corporate GHG emissions intensity and upholding its commitment to use fresh water in a responsible manner, protect biodiversity, and reclaim sites back to their original state at the end of their productive phase.

    Guiding Principles: 

    • Provide low-carbon energy for the future
    • Protect ARC’s water resources – “Secure, Reduce, Recycle”
    • Restore land

    Goals & Targets: 

    • Reduce GHG emissions intensity by 20 per cent by 2025, relative to our 2019 baseline
    • Implement a minimum of 70,000 metric tonnes of CO2e of emission reduction projects by 2025
    • Reinvest up to 100 per cent of carbon offset revenues into clean technology development and application to further reduce ARC’s corporate emissions
    • Ensure a minimum of 90 per cent of the water ARC produces is recycled
    • Invest from $50 to $100 million in asset retirement activities by 2025 to further reduce ARC’s corporate environmental liability

    Key Performance Highlights:

    • ARC has the lowest GHG emissions intensity in its peer group
    • Achieved 47% reduction in GHG emissions intensity since 2017
    • 89% of produced water is recycled
    • $34 million invested in asset retirement activities in the last two years
    • Pipeline incident rate is 1.02 incidents per 1,000 kilometres
  • Social

    ARC is committed to providing opportunities to society, including meaningful employment, a safe workplace, prosperous communities, and a healthy environment that respects tradition and local culture.

    Central to ARC’s operations is the health, safety, and wellbeing of its employees, contractors, and the communities in which ARC operates. Through strong ESG practices, ARC has always been committed to building strong and lasting relationships with Indigenous Peoples, improving the quality of lives in local communities, and developing its assets in the most responsible manner possible. ARC adheres to the highest employment standards, which has made ARC an employer of choice. Delivering on these commitments requires a diverse and inclusive workforce. ARC is committed to equitable treatment of its staff and values all employees for their unique contributions.

    Guiding Principles:

    • Be an industry leader in both health, safety, and environment practices and performance
    • Form strong relationships with Indigenous communities
    • Create shared value for society
    • Develop a diverse and inclusive workforce

    Goals & Targets:

    • Deliver industry-leading safety performance in total recordable injury frequency and lost-time incident frequency
    • Make concerted efforts to sign Impact Benefit Agreements with Indigenous Peoples in ARC’s primary areas of development
    • Continue to demonstrate leadership through active engagement with stakeholders on subjects such as a noise mitigation, induced seismicity, etc.
    • Create a formal recruitment strategy to build an inclusive workforce with a focus on increasing gender, race, and Indigenous heritage diversity in roles currently underrepresented, including management and field operations

     Key Performance Highlights:

    • 6 years without an employee lost-time incident
    • 37% decrease in contractor recordable injuries since 2017
    • Over $3 million donated to charitable organizations over the last two years

    Health and Safety

    The health and safety of all employees, contractors, stakeholders and members of the public is at the core of ARC’s values. Our focus on health and safety is a part of all areas of our day-to-day operations. In addition to our commitment to operational excellence, which prevents incidents from occurring, our team is well-trained in hazard recognition, proper follow-up on corrective actions and addressing emerging trends.

    To learn more about our approach to health and safety, including documentation for the Company's Operational Excellence Policy and Emergency Management Program, click here.

  • Governance

    ARC is committed to maintaining the highest standards of corporate governance and risk management through its adherence to regulatory standards and industry-leading practices in ESG oversight. ARC believes that its sound corporate governance practices are foundational in realizing the Company’s organizational purpose; in building trust with stakeholders and Indigenous partners; and in ensuring that ARC and its employees adhere to the highest standards of ethical conduct.

    Guiding Principles:

    • Ensure appropriate focus and oversight on ESG strategies and practices
    • Continually improve governance structure and processes
    • Ensure strong link between executive compensation and performance, including incorporating ESG metrics into determination of compensation levels

    Goals and Targets:

    • Ensure appropriate Board oversight on ESG matters through sub-committees.
    • Promote gender diversity by establishing a minimum of 30 per cent female representation at the Board level within the next three years
    • Expand scope of third-party assurance of key ESG performance metrics.
    • Incorporate key performance metrics, including several ESG-related metrics, into corporate performance scorecard to determine executive compensation levels.

    Key Performance Highlights:

    • 8 of 9 directors are independent
    • 22% of directors are female
    • 100% meeting attendance
    • 97% shareholder approval for approach to executive compensation

To learn more about ESG at ARC and our performance, visit our 2020 ESG Report which can be accessed here.