Corporate Strategy Overview
Our initiatives center around seven areas of strategic priority in four key focus areas. These strategies are reviewed at least annually with direction from Enbridge’s Board of Directors.
1. Commitment To Safety And Operational Reliability
- Focus on project management
- Preserve financing strength and flexibility
3. Secure the Long-Term Future
- Strengthen core businesses
- Develop new platforms for growth and diversification
4. Maintain The Foundation
- Uphold Enbridge values
- Maintain the Enbridge’s social license to operate
- Attract, retain and develop highly capable people
Commitment to Safety and Operational Reliability
Safety and operational reliability remains our number one priority and sets the foundation for our strategic plan. Our commitment to safety and operational reliability means achieving and maintaining industry leadership in safety (process, public and personal) and ensuring the reliability and integrity of the systems we operate in order to generate, transport and deliver the energy society counts on and to protect people and the environment.
Under the umbrella of Enbridge’s Operational Risk Management Plan (ORM Plan), which we introduced in 2010, we have undertaken extensive maintenance, integrity and inspection programs across our pipeline systems. The ORM Plan has resulted in strong improvements in the area of safety and operational risk management, bolstering incident response capabilities, employee and public safety protocols and improved communications with landowners and first responders.
In addition, an enterprise-wide safety and risk management framework has been implemented to ensure that we identify, prioritize and effectively prevent and mitigate risks across the enterprise. We strive to embed a common risk management framework within our operations and those of our partners.
Supporting these initiatives is a safety culture that strives towards a target of 100 percent safe operations, with a belief that all incidents can be prevented. To achieve the goal of industry leadership, we measure our performance as compared to standard industry performance, transparently report our results and continue to use external assessments to measure our performance.
Focus on Project Management - Our objective is to safely deliver projects on time and on budget and at the lowest practical cost while maintaining the highest standards for safety, quality, customer satisfaction and environmental and regulatory compliance. With an approximate $26-billion portfolio of commercially secured growth projects, successful project execution is critical to achieving our long-term growth plan. These projects are predominantly liquids focused, but increasingly include green energy, natural gas, offshore and gas distribution initiatives.
Through our Major Projects business unit, we continue to build upon and enhance the key elements of our rigorous project management processes including: employee and contractor safety; long-term supply chain agreements; quality design, materials and construction; extensive regulatory and public consultation; robust cost, schedule and risk controls; and efficient project transition to operating units.
Focus on Preserving Financing Strength and Flexibility - The maintenance of adequate financing strength and flexibility is crucial to our growth strategy. Our financing strategies are designed to ensure that we have sufficient financial flexibility to meet our capital requirements. To support this objective, we develop financing plans and strategies to manage credit ratings, diversify our funding sources and maintain substantial standby bank credit capacity and access to capital markets in both Canada and the U.S.
As part of our risk management policy, we mitigate the impact of fluctuations in interest rates, foreign exchange and commodity price on earnings. This economic hedging program, together with ongoing management of credit exposures to customers, suppliers and counterparties, supports one of the key tenets of our investor value proposition: a reliable business model.
We also use our sponsored vehicles, primarily through asset drop downs, to cost effectively fund a portion of our capital program. In 2015, we completed the Canadian Restructuring Plan, which transferred the majority of our Canadian Liquids Pipelines business and certain renewable energy assets to the Fund Group. We continually assesses ways to generate value for shareholders, including by reviewing opportunities that may lead to acquisitions, dispositions or other strategic transactions, some of which may be material. Opportunities are screened, analyzed and assessed using strict operating, strategic and financial criteria with the objective of ensuring the effective deployment of capital and the enduring financial strength and stability of the company.
Secure the Longer-term Future
Focus on Strengthening Core Businesses - Within our crude oil transportation business, strategies to strengthen the core business are focused on optimizing asset performance, strengthening stakeholder and customer relationships and providing access to new markets for production from western Canada and the Bakken regions, all while ensuring safe and reliable operations. Our asset optimization efforts focus on maximizing the operational and financial performance of our infrastructure assets within established risk parameters, providing competitive services and value to customers. Our assets are strategically located and well-positioned to capitalize on opportunities.
Our natural gas business is focused on strategies that include leveraging the competitive advantages of its existing assets, expanding its footprint into emerging supply areas and establishing more direct linkage to growing markets. To extend this position, we are focused on expanding our Canadian Midstream footprint. In addition to our focus on developing our Western Canadian gas business, we also continue to pursue offshore natural gas and crude oil transmission opportunities in the U.S. Gulf Coast region.
Our natural gas distribution business in eastern Canada is the largest in Canada with over two million customers. Enbridge Gas Distribution (EGD) is currently focused on the execution of the Greater Toronto Area (GTA) project, which is a key component of EGD’s gas supply strategy and will provide new transmission services that will enable access to mid-continent gas supplies for the utility and its customers.
Focus on New Platforms for Growth and Diversification - The development of new platforms to diversify and sustain long-term growth is an important strategic priority. We are currently focusing our development and diversification efforts toward securing investment in additional renewable energy generation, liquefied natural gas (LNG) development, gas-fired power generation and energy marketing, as well as exploring opportunities to extend our energy delivery and generation services to select energy markets outside North America.
In 2015, we continued to expand our interests in renewable power generation with the acquisitions of the 103-MW New Creek Wind Project (New Creek) in West Virginia and a 24.9 percent interest in the 400-MW Rampion Offshore Wind Project (Rampion Project) in the United Kingdom. Including these acquisitions, we have invested approximately $5 billion in renewable power generation and transmission since 2002.
Within our existing renewables business, our goal is to take over full operational responsibility of our power generation facilities as operating contracts with key service providers expire and if the associated economics are viable. Our energy marketing business also plans to expand its business through obtaining capacity on energy delivery and storage assets in strategic locations to achieve higher earnings from location, grade and time differentials. We also invest in early-stage energy technologies that complement our core businesses.
Maintain the Foundation
Focus on Upholding Enbridge Values - We adhere to a strong set of core values that govern how we conducts our business and pursues strategic priorities, as articulated in our value statement: “Enbridge employees demonstrate Integrity, Safety and Respect in support of our communities, the environment and each other.” Employees are expected to uphold these values in their interactions with each other, customers, suppliers, landowners, community members and all others with whom the company deals, and to ensure that the company’s business decisions are consistent with these values. Employees and contractors are required, on an annual basis, to certify their compliance with our Statement on Business Conduct.
Focus on Maintaining the Company’s Social License to Operate - Earning and maintaining “social license”—the acceptance by the communities in which we operate or are proposing new projects—is critical to our ability to execute on our growth plans. To earn public acceptance of Enbridge and our projects and activities, we are increasingly focused on building long-term relationships by understanding, accommodating and resolving public concerns related to our projects and operations. We engage with key stakeholders through collaboration and by demonstrating openness and transparency in our communication. We also focus on enhancing the Government Relations function with a goal of advocating company positions on key issues and policies that are critical to its business. We also build awareness of the role energy and Enbridge play in people’s lives in order to promote better understanding of our businesses.
To earn the public’s trust, and to help protect and reinforce our reputation with our stakeholders, we have embraced sustainable development principles and practices and are integrating them into all aspects of our business, including public reporting and disclosure of our performance on key environmental, social and governance issues according to widely recognized norms.
Focus on Attracting, Retaining and Developing Highly Capable People - Investing in the attraction, retention and development of employees and future leaders is fundamental to executing our corporate strategy and creating sustainability for future success. We focus on enhancing the capability of our people to maximize the potential of the organization and undertake a variety of activities such as offering accelerated leadership development programs, enhancing career opportunities and building change management capabilities throughout the enterprise so that projects and initiatives achieve intended benefits. We also strive to maintain industry competitive compensation and retention programs that provide both short-term and long-term incentives.