Social responsibility as a business strategy

International standards have become a major criterion, which orients many domestic companies in their development. Access to global markets and the upcoming admission of Kazakhstan into World Trade Organization means in order to progress we must comply. At the same time, running a business by international standards assumes the emergence of a corporate social responsibility concept into a manager’s vocabulary. Different researches give various definitions to this concept. However the major components remain the same. These are full and timely payment of taxes, preserving and creation of new jobs, provision of rights and protection of workers, ensuring social benefits to employees, prompt labor compensation, employment of young workers. In the case of KazTransOil Company this is also includes sponsoring the disabled, elderly people and children.

Along with production activities KazTransOil carries out significant social work, targeted at support and development of cultural and social activities, including providing help to vulnerable groups of the population in the fields of education, public health, sports, mass media and public organizations. Also our company participates in the implementation of governmental programs and organization of important public events.

The areas of social assistance from our company cover a wide range of activities. These are organization of treatment for disabled people, assistance in running contests for children and sponsoring international media forums. Special attention is paid to the children. The company carefully reviews all the requests, coming in from the young citizens of our republic. Significant financial resources are directed for aiding children. KazTransOil provided support for young friends, including the following organizations: Public Organization Center for social adaptation of children, Public Organization Society of disabled children of Astana and Atyrau children’s home. Warm attention was paid by the company to sponsorship request from the Tamdin ancillary school children, Kulynshak children’s home, children’s village of Astana, Akkol children’s home and the Beam of hope Center for disabled children’s rehabilitation.

The company organizes charity donations to children’s homes and public organizations of disabled people in all the regions, where our company has large structural units located: Atyrau, Mangistau, Western Kazakhstan, Aktobe, Pavlodar, Zhezkazgan and Southern Kazakhstan Oblasts.

It is worth highlighting the JSC KazTransOil social policy, targeted at veteran’s and pensioner’s support. The company actively cooperates with many public organizations. Thus war and labor veterans are frequent guests in the company; often JSC KazTransOil invites them to grand meetings and other important events. Victory day is specially regarded. On this day all the branches of KazTransOil congratulate war veterans and home front workers as well as offering them some financial awards.

In 2005 on Elderly People’s day the head office and the JSC KazTransOil Collective site branch employees collected money (one-day income) to provide help to the boarding school of Astana veterans and disabled people. The collected money was used to purchase TV sets and refrigerators.

Pipeline transport veterans are also given a consideration. Every month former employees of company structural units are provided with additional payments to their pensions.

One more vector in the social responsibility program is the support of events, which are of public importance. In this concern, it is worth mentioning sponsorship support to the Kazakh national music academy as well as the Eurasian media forum.

JSC KazTransOil also sponsored the participation of Chernobyl Veterans Union Republican Public Association in International Conference “Chernobyl 20 years later. The strategy of rehabilitation and sustainable development of suffered regions”.

No less important is the fact that social responsibility for the KazTransOil Company means not only charity, but also a high-level of responsibility in current production activities; at the same time, the interests of the population are given the first priority. Thus on January 1 2007 the tariffs for supplying fresh water to Atyrau and Mangistau Oblasts residents were decreased by 3-7%. This substantial help was sponsored by the KazTransOil Company, which owns the Astrahan-Mangyshlak trunk water pipeline and adopted a new tariff policy.

The company staff made an important contribution to ecological revitalization of the regions. At the end of March of this year all company branches organized “subbotniks” (volunteer clean-ups); on that day, KazTransOil workers planted nearly 3.5 thousand fine wood seedlings.

The Pipeline Company pays great deal of attention to support of socially significant regional projects. In the past years substantial financial resources were directed to the resolution of socio-economic issues of the Western Kazakhstan Oblast residents such as implementation of complex programs on improving the sanitation and ecologic condition, municipal improvements and greenery planting in Aktobe, reconstruction of the Zhana-Ozen social units and others.

It is commonly known that one of the priorities in the state domestic policy is the support program to villages. Under its framework JSC KazTransOil has developed and implemented a unique project, the main goal of which is company-paid training and consequent employment in the oil transportation system of youth from rural areas. Today, 96 residents of rural areas already collected their professional technical degrees. For 2.5 years the youngsters were studying at professional colleges in Western Kazakhstan. In 2006 the first 50 graduates were employed in units of the Companies Eastern branch, which provides oil transportation by the new Atasu-Alashankou trunk oil pipeline. The outcome of this program should be very promising since its major goal is to improve the qualifications and educational level of the youth in rural areas, employment of the rural regions population as well as increasing the wealth of many families.

With a purpose of studying and distributing the best experience, introducing innovative technologies in servicing trunk pipelines, improving professional aptitude and the level of technical preparation as well as developing a creative approach at work the company annually organizes the Department’s best employee contest among leading professionals. This year, besides JSC KazTransOil employees, the award was contested by experts from three other CIS pipeline companies: OJSC AK Transneft, OJSC UkrTransNafta and RUP Gomeltransneft Druzhba. Representatives of eight professions competed for the award among leading experts. A joint contest committee judged the performance of contestants by the level of their knowledge of theory, practical skills, aptitude, observance of safety measures and many other criteria. It is important to mention that highly qualified workers participated in the contest and nearly all of them demonstrated high ambitions and were determined to win; they were representing not only their companies but also their home countries. As a result of the competition KazTransOil workers fairly won first prizes in all three nominations.

One of the priority goals for the company is the development of a human resource base. Thousands of highly qualified experts are employed within the enterprise; they have specific training and additional education in higher education institutions of our country and abroad, professional colleges and the KazTransOil education and training center.

In cooperation with the leading professional institutions of our republic, such as Kazakh National Technical University, named after Satpaev, KBTU, Aktau state university, named after Esenov and Atyrau institute of Oil and Gas, the company offers field internships at its structural units for students with 3-5 years of education. The results of preliminary interviews with the young specialists defined 30 students for their consequent employment with JSC KazTransOil.

Today, two company employees attend MBA programs in the leading schools of foreign countries: Georgetown University (USA) and the University of Dundee (Great Britain).

During 2006 we organized a number of corporate trainings with attendance by employees from head office management, branches and company representative offices. Overall, 514 successfully completed training programs.

We can not help noting the opportunities, provided by company, on independent educating and testing of workers. The Education and training center, which is a part of Western branch, educates about 120-150 people monthly. The classrooms have all necessary facilities for professional training of experts. In the last years the technical equipment has been substantially improved; a number of education and production units, handout material and technical means were developed. The welding training classroom has 10 stations; moreover, there are a tensile-testing machine and a pile driver, which allow carrying out the whole range of mechanical tests of weld seams when attesting electric welders. In 2006, 1,051 company employees were trained and improved their qualifications at the education center, including 862 experts of different professions and 189 engineers and technicians.

Besides providing these competitive employment terms to staff, KazTransOil offers free medical services and the opportunity to attend sports clubs. The company provides the children of employees with packages to summer health clubs. Despite the extensive geography of JSC KazTransOil structural units’ locations, all these events are accessible to every employee of the company.

KazTransOil conducted a new social project to celebrate its 10 year anniversary. The company purchased and delivered free of charge 13 reanimation machines to medical institutions, located in the regions, where the company runs its business. New ambulances were distributed in Astana, Almaty, Atyrau, Aktau, Uralsk, Aktobe, Kulsary, Pavlodar and other cities.

KazTransOil pays particular attention to the propaganda and support of a healthy life-style. Sports events are not only a method of keeping yourself in shape but also a great opportunity to develop corporate culture and team spirit. This program was a great success inside the company. There are annual competitions in different sports. The company branches are proud of their sports achievements. The Indoor soccer team of KazTransOil, 100% constituted by Western branch workers, has won the championship and Aktau cup three times in a row. Since 2000 it has been participating in the national championship among premier league teams.

Therefore, the concept of social responsibility for KazTransOil is somewhat broader than ordinary sponsorship and charity. All the efforts of this leading pipeline Company are directed both at successful business operations and a fruitful partnership which benefits our company employees and the ordinary citizens of our country and Kazakhstani society in general.