ESG Corporate Governance
GRI 2-9, 2-12, 2-13, 2-17, 2-18, 2-19, 2-20
CEZ Group is committed to transparent and effective sustainability and ESG governance. In July 2021, we established an ESG Office led by the Chief Sustainability Officer (CSO), Kateřina Bohuslavová. The CSO reports directly to the CEO, Daniel Beneš. They are both sustainability leaders in CEZ Group. ESG Office is responsible for everyday sustainability agenda, non-financial reporting, coordination of ESG initiatives, and management of ESG working groups. ESG management uses the Centralized-coordination-decentralized-implementation model.
Chief Executive Officer and Chairman of the Board of Directors of ČEZ, a. s.
Chief Sustainability Officer and the Head of ESG Office of CEZ Group
ESG Strategic Steering Committee
Board of Directors, CSO
selected top management
ESG Executive Steering Committee
CSO, division representatives, managers of ESG Initiatives
and ESG Working Groups
ESG
Initiatives
ESG
Working Groups
ESG Strategic Steering Committee (SSC)
The SSC is the highest level of ESG management. The rights and responsibilities of the SSC are set out in the ESG Strategic Steering Committee Charter. The SSC determines CEZ Group’s sustainability strategy and monitors the progress of ESG initiatives and working groups. The SSC also monitors the fulfilment of targets set in VISION 2030—Clean Energy of Tomorrow.
The ESG Sponsor and the Chairman of the SSC is the CEO and Chairman of the Board of Directors, Daniel Beneš. The ESG Executive Sponsor and the Vice-Chairwoman of the SSC is the CSO, Kateřina Bohuslavová. Other members of the SSC are the members of the Board of Directors, the Strategy Director, the Communication and Marketing Director, the Legal Affairs Director, and the Audit and Compliance Director.
ESG Executive Steering Committee (ESC)
The ESC is the managerial and operational level of governance and coordination of the ESG agenda. The Chairwoman of the ESC is the CSO, Kateřina Bohuslavová. Its members are representatives of all Divisions and key departments in terms of ESG management.
ESG Initiatives
ESG Initiatives are projects led by teams managed within one division to implement ESG objectives approved by the SSC across the CEZ Group. The ESG initiatives are headed by managers appointed by the initiative sponsors.
ESG Working Groups
ESG Working Groups are cross-divisional management teams that implement ESG objectives approved by the SSC across the CEZ Group. The ESG Working Groups are headed by leaders appointed by the Chairwoman of the ESC.
ESG Education
CEZ Group is committed to the highest quality of sustainable management. Each member of the Board of Directors, the CSO, and other top management have received ESG-related certifications. The programs are offered by higher education institutions in the United States of America and Czechia:
- Berkeley Law: ESG: Navigating the Board’s Role
- Berkeley Law: Sustainable Capitalism & ESG
- Diligent Institute: Diligent Climate Leadership Certification
- Prague University of Economics and Business: Academy of Corporate Sustainability Management
Policy Matrix
CEZ Group developed a policy matrix to strengthen the managerial responsibility for ESG issues. The matrix illustrates both board-level oversight and executive managerial responsibility for each area. Responsibilities are linked to designated positions regardless of the individuals holding them. Currently, we are systematically reviewing all policies under the Policy Matrix ESG Initiative, which will expand the matrix with specific measures and targets.
| Sustainable Strategy Oversight |
Pillar Oversight | Policy | Policy Oversight |
|---|---|---|---|
| CEO | E Chief of the Renewable and Traditional Energy Division |
Emissions & Waste | Chief of the Renewable and Traditional Energy Division, Chief of the Nuclear Energy Division |
| Water Stress & Water Use | Chief of the Renewable and Traditional Energy Division, Chief of the Nuclear Energy Division | ||
| Climate-Related Issues | Chief of the Renewable and Traditional Energy Division, Chief of the Nuclear Energy Division, CEO | ||
| Climate-Related Issues: Suppliers | Chief of the Renewable and Traditional Energy Division, Chief of the Administration Division * | ||
| Environmental Risks | Chief of the Finance Division | ||
| Biodiversity | Chief of the Renewable and Traditional Energy Division | ||
| Site Closure | Chief of the Sales and Strategy Division | ||
| Renewable Energy | Chief of the Renewable and Traditional Energy Division | ||
| S Chief of the Administration Division |
Community Engagement | CEO | |
| Health & Safety | CEO | ||
| Human Capital | Chief of the Administration Division | ||
| Human Rights | Chief of the Administration Division | ||
| Diversity | Chief of the Administration Division | ||
| Customer Engagement | Chief of the Sales and Strategy Division | ||
| Purchasing Practices | Chief of the Administration Division * | ||
| G CEO |
Public Engagement (lobbying) | CEO | |
| Remuneration, Clawback & Malus | Chief of the Administration Division | ||
| Business Ethics | CEO | ||
| Whistleblower | CEO | ||
| Bribery and Anti-Corruption | CEO, Chief of the Administration Division * | ||
| Anti-Corruption: Suppliers | Chief of the Administration Divisio * | ||
| Anti-Money Laundering | Chief of the Finance Division | ||
| Cybersecurity | CEO | ||
| Business Travel | Chief of the Administration Division |
* The policy falls under the responsibility of the CEO of ČEZ, a. s.; the policy is supervised by the Director of the Administration Division.
| POLICY | DIVISION | Manager | Coordination (ESG Office) |
ESG Oversight |
|---|---|---|---|---|
| Emissions & Waste | Renewable and Traditional Energy | Head of Generation and Operation | ESG specialist for environmental | CSO |
| Nuclear Energy | Head of Safety | |||
| Water Stress & Water Use | Renewable and Traditional Energy | Head of Generation and Operation | ||
| Nuclear Energy | Head of Safety | |||
| Climate-Related Issues | Renewable and Traditional Energy | Head of Generation and Operation | ||
| Nuclear Energy | Head of Safety | |||
| Climate-Related Issues: Suppliers | Renewable and Traditional Energy | Head of Technical Management | ||
| CEO | Head of Procurement for Generation | |||
| Environmental Risks | Finance | Head of Risk Management | ||
| Biodiversity | Renewable and Traditional Energy | Chairman of the BoD of Severoceske doly, a.s. | ||
| Site Closure | Sales and Strategy | Strategy Director | ||
| Renewable Energy | Renewable and Traditional Energy | CEO of CEZ Obnovitelne zdroje, s.r.o. | ||
| Community Engagement | CEO | Head of Public Affairs | ESG specialist for social | |
| Health & Safety | CEO | Head of Management System | ||
| Human Capital | Administration | Head of HR | ||
| Human Rights | Administration | Head of HR | ||
| Diversity | Administration | Manager of Diversity and Inclusion | ||
| Customer Engagement | Sales and Strategy | CEO CEZ Prodej, a.s. | ||
| Purchasing Practices | CEO | Head of Procurement | ||
| Public Engagement (lobbying) | CEO | Head of Public Affairs | ESG specialist for governance | |
| Remuneration, Clawback & Malus | Administration | Head of HR | ||
| Business Ethics | CEO | Head of Audit and Compliance | ||
| Whistleblower | CEO | Head of Audit and Compliance | ||
| Bribery and Anti-Corruption | CEO | Head of Procurement for Generation | ||
| CEO | Head of Procurement | |||
| CEO | Head of Audit and Compliance | |||
| Anti-Corruption: Suppliers | CEO | Head of Procurement for Generation | ||
| CEO | Head of Procurement | |||
| Anti-Money Laundering | Finance | Head of Accounting | ||
| Cybersecurity | CEO | Head of CEZ Group Security | ||
| Business Travel | Administration | Head of HR |
Remuneration Policy
The Remuneration Policy clearly and transparently defines all fixed and variable remuneration components of the Board of Directors and Supervisory Board members. Remuneration is based on the Say-on-Pay principle: shareholders can comment on the remuneration policy through voting at the Shareholders’ Meeting. The Remuneration Policy specifies any bonuses, other benefits, maluses, a clawback provision, conditions for office termination, severance pay, and a non-competition clause. It also defines key financial and non-financial performance indicators. Each year, the Board of Directors submits a public Remuneration Report of ČEZ, a. s., to the Shareholders’ Meeting for approval.
The Supervisory Board defines and evaluates performance indicators related to any variable component of remuneration of members of the Board of Directors. Each Member of the Board of Directors has a specific KPI linked to ESG incorporated among the top 5 KPIs, which are assessed annually. All Board members individually have a unified ESG task with a weight of at least 15% for 2023. This task requires reaching a target level of international ESG rating of ČEZ, a. s., fulfilling our public commitments, implementing ESG initiatives, and taking measures in line with the accelerated strategy of VISION 2030. Thus, the Supervisory Board also fulfills its role of the Remuneration Committee.