Strategic Report 01 Strategy 02 03 04 Compliance with the Group’s standards is ensured by centralised The standards are already issued and introduced to each hospital’s control exercised by the respective business lines in their day-to-day management team. For 2019, preliminary surveys are planned activities. In addition, the Internal Audit department, the recently in hospitals to assess the current level of compliance and define created Internal Security department and the Risk Management Team directions for improvement. Afterwards, an annual survey will periodically carry out direct control reviews, which includes undertaking be carried out by a group of experts (in each business area) surveys, due diligence, monitoring and other internal control system as part of performance assessment system. tools and methods. iii. Restructuring of the existing performance assessment system In 2018, our newly-developed Risk Management department conducts The Group has introduced a modified annual performance due diligence on components of environmental and social policy, while monitoring system, which puts increased emphasis on and Internal Security department monitors adherence to anti-bribery and provides additional encouragement for adherence to Group anti-corruption policy in day-to-day activities. policies. This is achieved by incorporating internal standards fulfilment as a significant KPI for all referral hospitals starting As the Group remains dedicated to improving implementation of its from 1 January 2019. policies, it took significant steps in this respect in 2018 as well; specifically, the referral hospitals launched the Delegation Project to strengthen and Annex 1 improve existing management systems. The project intends to delegate GHG emissions calculation methodology significant part of functions currently performed by the headquarters to We have reported on all the emission sources required under the business unit managers. This gives increased flexibility to hospitals the Companies Act 2006 (Strategic Report and Directors’ Reports) and enables headquarters to focus on policy implementation, monitoring Regulations 2013 (Scope 1 and 2) and additionally reported on some and control. The project consists of three major phases: emissions under Scope 3. These sources fall within our consolidated Financial Statements. We are not responsible for any emission i.Delegation of responsibilities and the decision-making processsources that are not included in our consolidated statements. The hospitals have defined the scope of delegated functions, which are as follows: We have used the World Resources Institute/World Business Council • Full independence in daily routine management across the full for Sustainable Development (“WRI”/”WBCSD”) Greenhouse Gas range of hospital operations. (“GHG”) Protocol: A Corporate Accounting and Reporting Standard • Operational expenses are fully delegated within the approved (revised edition) and the UK Government Conversion Factors for GHG. budget, while for capital expenditures only 30% of the approved budget is delegated. Factors for Company reporting 2018 • HR decisions – hiring and firing, rotation – are fully delegated, The data are collected and reported for three of our except for the hospital’s top management positions. Group’s businesses: • Since November 2018, hospitals have carried out the functions healthcare services, including its head office, hospitals • within the scope of delegation. and other entities, where GHG has operational control; ii.Strengthening of the supervision function • pharma, including its head office and pharmacies; and The project aims to change the headquarters day-to-day • medical insurance, including its head office. involvement and move to a more decentralised management The data on emissions resulting from travel are reported for business system, by only keeping support, policy-making and educational related travel only and exclude commuting travel. Data from joint role and in turn strengthening supervision and control functions. ventures, investments or sub-leased properties have not been In order to implement a unique, efficient and risk-based system included in the reported figures. of hospital management, headquarters issues internal standards defining performance expectations, rules, structures and functions The data for 2018 are provided by on-site delegates, invoices for hospitals. These standards are in line with the Group’s policies and meter readings. described above. Compliance with internal standards will be one of the major hospital performance valuation indicators. Internal standards set performance requirements for the following business areas of the hospital: • Clinical quality and patient service. • Operations. • Customer Service. • HR. Scope 1 Scope 2 Scope 3 Combustion of fuel and facilities operation Electricity, heat, steam and cooling purchased Includes emissions from: includes emissions from: for own use includes emissions from: • air business travel (short-haul and • combustion of natural gas, diesel and • electricity spent at owned and long-haul); information on the class petrol in stationary equipment at owned controlled sites; to calculate the of travel is unavailable, hence we used and controlled sites; and emissions, we used the conversion an “average passenger” conversion • combustion of petrol and diesel in factor for Non-OECD Europe and factor; and owned vehicles (cars and buses). Eurasia (average) from the UK • ground transport, including taxis, Government GHG Conversion Factors vans and cars hired. for Company Reporting 2018; and • used heat and steam. 47