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Values Matter
Sustainability Report
Values Matter
2016 Sustainability Report
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Our Approach to Governance

As a responsible energy producer, Vermilion believes that we can best deliver long-term shareholder value by operating in an economically, environmentally and socially sustainable manner that recognizes the importance of all our stakeholders. The integration of sustainability principles into our business is not only the right thing to do: we believe it increases shareholder returns, enhances our business development opportunities and reduces long-term risks to our business model.

The information in the Energy Transition section of our sustainability report reflects our alignment with the Task Force on Climate-related Financial Disclosures (TCFD).

Board Oversight: 

Vermilion is committed to a high standard of corporate governance practice, as strong governance is in the best interest of our shareholders and promotes effective decision-making at the Board level and throughout the company. The members of our Board of Directors, Vermilion’s highest governing body, are proven leaders   who guide our management, ensure the continued integrity of our people and processes, oversee risk management, and position our company to deliver on our purpose: to responsibly produce essential energy while delivering long-term value to our people, shareholders, customers, partners and communities.

Complete Board governance details can be found in our regulatory filings, particularly our Information Circular  and Board Operating Guidelines, including independence of directors, skills and experience, elections, tenure, diversity, evaluation and compensation. As a publicly traded company, we believe compensation transparency strengthens trust, including our link between sustainability performance and long-term compensation for all employees and executives. 

We monitor corporate governance development on an ongoing basis, engage with key governance and proxy advisory services, and adjust our practices where we determine it’s beneficial for the company and our shareholders. We have been consistently recognized for excellence in governance practices by a wide range of organizations, including the Globe and Mail Board Games report, the Canadian Coalition for Good Governance, and MSCI. For details, please see our Awards page.

The Board has responsibility for oversight of Vermilion’s sustainability and climate-related performance, with Board committees providing additional sustainability-related expertise in their areas of focus.


EESG Factor Overview


Financial information

Risk management

Internal control systems 

Audit processes

 Governance and Human Resources

 Board effectiveness and compensation risk

Compensation philosophy and practices

Corporate governance and performance

People practices, including succession and development

 Health, Safety and Environment (HSE)

 Occupational, process and asset safety

Environmental stewardship

Risk management

HSE-related sustainability initiatives

 Independent Reserves

 Reserves and resources


Finding, developing and acquisition costs


 Energy transition

Social impacts, including human rights, community investment, and government and other stakeholder relations


We maintain two skills matrices to evaluate the skill set of the Board. Each Director rates their expertise in each area annually, on a scale from limited to expert. The results are then evaluated for individuals and for the Board as a whole. In addition to the Board skills matrix, we highlight the skills and experience that our Board members bring to managing ESG factors in our Sustainability Skills Matrix. This aligns with recommendations from the TCFD, but extends beyond climate-related impacts such as emissions reduction programs, to recognize the importance of social impacts, including safety and strategic community investment. Following our most recent assessment, it was determined that the majority of directors are skilled, or at expert/mastery levels.102-28

The Board’s Sustainability Committee, comprised of independent directors, provides additional advice for the oversight of Vermilion’s approach, including the long-range strategic plan, sustainability performance including key performance indicators, and methods of communicating sustainability policies and performance. The committee’s role also encompasses identifying and reviewing emerging risks and opportunities associated with sustainability issues, including significant matters such as the energy transition and social impacts, including human   rights, community investment, and government and other stakeholder relations, along with the integration of those risks and opportunities into Vermilion’s Enterprise Risk Management framework..

The Board receives sustainability performance reports quarterly, which include ESG  performance, sustainability activities, briefings on sustainability from business unit leaders, environmental and social trends, and strategic community investment activities. These are augmented with continuing education from third parties in fields such as climate change and the energy sector, the energy transition, and ESG factors in institutional investment. The Board and its Sustainability Committee use this information to ensure the integration of sustainability and climate-related risks within our enterprise risk management system, to better inform decisions on business strategy and risk mitigation, and to provide direction on policy and strategy.

A full list of Board sustainability-related activities can be found here.

Management Role

Organizational responsibility for sustainability and climate-related issues flows from the Board and its Sustainability Committee throughout the Company via our Executive Committee. This comprises the Executive Chair, President, Chief Financial Officer, VP Business Development, VP International & HSE, VP North America, and VP European Operations.

Our VP Sustainability, who reports directly to the President and presents on progress every six weeks to the Executive Committee, develops and implements sustainability strategy, working in partnership with corporate teams and business units to ensure that our strategy and reporting reflect Vermilion’s goals as a company overall and for each region.

Our VP, North America and our VP, International & HSE lead the operationalization of sustainability, with the leaders of each business unit responsible for sustainability activities, including managing climate-related risks and opportunities within their organizations. Each of our business units has also identified a Sustainability Lead, to support sustainability-related work.

Our corporate sustainability team provides a centre of excellence approach, advising the business on all aspects of sustainability, including environmental, climate and social  trends, and reporting quarterly to the Board and/or the Sustainability Committee regarding progress. The corporate team is also responsible for external sustainability reporting.

Various departments within the Company report sustainability-related priorities and progress quarterly to either the full Board or Board committees, including governance updates, HSE targets and performance, People and Culture policies, and public and government relations.

We believe this approach clearly communicates, both externally and internally, our commitment to sustainability as a priority throughout the company and positions us to recognize the opportunities it presents. It also supports the proactive manner in which we address external risks that have potential impacts on short and longer-term company performance. For more detail, view our Risk Management page.

Values Matter
Vermilion Energy