No. 1, 2008

Ten years of productive work by the World Wildlife Fund in Russia

The World Wildlife Fund (WWF) occupies a special place among the organizations whose function is to draw the attention of the general public and the politicians in many countries of the world to problems of ecology and environmental protection. In Russia, the WWF carries out outreach activities and interacts with many large companies to help preserve Russia’s unique and extremely varied natural environment.

Approaching the 50th anniversary

The WWF was founded in 1961 to become actually the first truly independent global nongovernmental nonprofit conservation organization (NCO). Unlike many other international ecological nonprofit organizations, the WWF is a network NCO rather than a vertically centralized organization. It comprises 30 national WWF organizations and 3 associate offices.

The national organizations jointly finance the activity of the international secretariat of the WWF stationed in Gland (Switzerland), a small town not far from Geneva which used to be the headquarters of the League of Nations – the prewar predecessor of the United Nations. The WWF international secretariat organizes the Fund’s work in countries which do not have a national WWF organization of their own but which have the secretariat’s program offices. It also coordinates the work of the national WWF organizations, primarily by presenting the Fund’s agreed-upon position in international organizations and providing for the legal protection of our logo and symbol – the panda.

About five million individual members of the WWF support its activities financially. This support accounts for 55-60% of the WWF budget. About 22% of the budget are funds received by national WWF organizations from intergovernmental organizations (the Global Environment Facility, for instance) as well as from national governments and government agencies – international development agencies, as a rule. About 8% of the WWF budget are the funds received by WWF organizations from the businesses which support our work, and some 10-15% are deductions from the credit cards of our supporters who are clients of issuing banks, license fees for using our panda logo (in Russia, for instance, this also includes civil liability voluntary insurance contracts of the RESO-Garantia company) and the WWF funds invested via the investment companies officially known for the high ecological standards of their investment policies.

On the vast expanses of Russia

The WWF started its first projects in Russia in 1988 and carried them out, as a rule, in partnership with the academic community and the International Socio-Ecological Union. In 1993, with the support of the John D. and Catherine T. MacArthur Fund, a large portfolio began to be compiled of investment projects aimed at preserving the biological diversity in the Russian Federation amid the country’s arduous transition to a market economy and a collapse of the government-financed conservation sphere. Established in July 1994 on the basis of the team that had carried out the project was the Russian Programs Office of the WWF International Secretariat.

In the first few years, the WWF efforts in Russia were aimed at tackling the most pressing problems in the traditional conservation sphere and at preserving the country’s unique system of national preserves and national parks and other especially protected natural areas (EPNA) and adapting their activity and management to the new socioeconomic realities of the development of market relations and democratization of Russian society. Furthermore, we have always attached particular significance to protecting the so-called flagship species and the natural environment as a whole, so important for the global preservation of the biodiversity of the Far East, the Altai-Sayan highlands and some other areas. During the first decade of our activity we focused to such flagship species as the Amur tiger (owing in part to our efforts, its population in Russia is the largest in the world and relatively safe), the Far Eastern leopard and the European auroch. Our efforts included setting up specialized counter-poaching teams in the Russian Far East. As a result, the area of the federal EPNA in Russia has grown by about 25%, while in the Arctic their area has doubled.

During that period of our work many of our projects were of the so-called budget-substituting nature. For instance, we trained the managers of national preserves and national parks. At that time it was both understandable and justified: quite often the government budget lacked the necessary funds for carrying out many of its functions and obligations, environmental protection included. In the mid-1990s, the financing of national preserves and national parks went down to less than one-quarter of what was really needed.

Starting with 1996-1997, when it became clear that the greater was the international aid received in Russia for environmental protection, the smaller were the funds allocated by the

Russian government for this purpose, we began to reject budget-substituting projects. For, as the popular saying goes: “It is better to teach one how to use a fishing rod than to give him pieces of fish all the time.”

Oilmen’s substantial contribution

In our latest WWF Russia environmental protection strategy for 2008-2012, we have set ourselves the task of achieving by the year 2010 a situation where at least three major oil companies have plans and programs for preserving the flagship species and supporting the development of the ecological networks of especially protected natural areas as well as individual EPNA, and by 2012 – a situation where all the vertically integrated oil companies operating in high-priority ecological regions have corporate biodiversity preservation programs or special sections in their corporate policies compliance with which should be checked upon regularly by independent ecoauditors.

Our partners and supporters in Russia have donated about 1.5 million euros to the WWF Russia budget for the fiscal 2008. Within the next few years we plan to achieve a situation where over 50% of the WWF Russia’s fund are of Russian origin. Moreover, we hope to be able to start using Russian funds to finance WWF projects in Central Asia and a number of developing countries for the conservation of the wildlife of which we feel morally responsible. These are the Transcaucasus states as well as Mongolia and Vietnam, and countries where the environmental impact of the Russian tourist industry is fairly strong, such as Turkey and the Mediterranean countries.

According to a recent assessment of compliance of the official policies pursued by vertically integrated companies with the common requirements of the ecological NCO, LUKOIL is second only to TNK-BP. This shows that, on the political plane, LUKOIL is aware of and takes into account a wide range of ecological and conservation problems formulated by the nongovernmental environmental organizations. The Company’s policy contains many forward-looking provisions and commitments but at present, the WWF Russia cannot give an objective appraisal of the level and quality of its realization. In my view, the level of realization of the Company’s official environmental policy requires confirmation by an independent third party – an auditor or an environmental NGO.

In my view, over the past eight years, a positive process has been underway in the Company of shaping up an up-to-date, civilized ecological policy, although its cooperation with the environmental NCO needs to be strengthened further. The internationalization of the Company’s operations, including its access to the mass end user in the United States and a number of countries in Central and Eastern Europe, and the ecological problems and conflicts in which LUKOIL was involved in the 1990s in Russia, have helped the Company’s top management acquire a better, more objective understanding of the current ecological problems. I have the impression that the Company is formulating modern standards of ecological responsibility and transparence for its core operations. It is no accident that LUKOIL pioneered implementation of the ISO 14001 environmental management standard in the Russian oil and gas sector. As I see it, the Company’s top managers have been less affected by the “Weimar syndrome” than the management of government companies, and they understand better that the requirements of environmental responsibility reflect the demands of the consumer and are not the hostile “intrigues of Russia’s geopolitical rivals and the enemies of its economic development.”

In this connection, I am pleased to note that LUKOIL was the first vertically integrated company to provide us with information on the environmental aspects of its refining operations, information which we needed for our project of compiling an environmental rating list of oil refineries. Unquestionably, that fact testifies to a high degree of the Company’s environmental transparency.

Furthermore, meetings with LUKOIL employees in various regions that take place from time to time – as was the case during the signing of an agreement with the administration of the Nenets Autonomous Area – make it possible to note their high professional level and their commitment to dealing with the socioeconomic and ecological problems faced by residents of the regions in which the Company is active.

It would be no exaggeration to say that in the 21st century, global economic performance will largely be determined by competition in terms of the oil companies’ environmental and social responsibility to the world community.