The FINANCIAL — Lukoil Georgia, a leading local oil company, organizer of the Media Rafting contest, claims to be developing a healthy lifestyle in business. The FINANCIAL interviewed Maia Chikvanaia, Director, Unigroup Ltd, regarding the company’s commitment to promoting healthy lifestyle in the country.
Q. As Lukoil stated, the company’s priority objectives are health protection and safety of personnel and communities in the areas where Lukoil operates and natural resources management. What is the strategy for Georgia developed by Lukoil Georgia?
A. Lukoil Georgia, being the subsidiary of the Lukoil, does its best to develop corporate directions to the maximum. Health promotion is not an exception either; lots of events and projects are planned in this direction both at the head office and in Georgia.
Q. Media Rafting by Lukoil Georgia is one of the best loved summer competitions in the country. How did you first come to the idea of launching the project and what are the core values Media Rafting stands for?
A. The idea of launching the Media Rafting contest was developed in 2006 and turned out to be quite an interesting venture as it quickly became a much praised event.
Media Rafting was aimed at turning journalists from side observers into direct participants. Media representatives are very popular in Georgia and a healthy lifestyle promotion by these people has a great influence on the population.
The mission of Media Rafting is to support the promotion of healthy lifestyle.
Q. How much does Lukoil spend on organizing Media Rafting annually and how much has the company allocated for healthy lifestyle promotion in the current year?
A. The Media Rafting budget increases every year, which is in the first place conditioned by the growth of interest towards the event. On the other hand we’re committed to making the contest better organized and truly one to remember.
Q. Do you think healthy lifestyle is essential for successful business?
A. Indeed, it’s very important to follow a healthy lifestyle. Though it should also coincide with correct life principles and not only be a promotion of successful business.
Q. Is it easy to engage companies in sports events? Which companies are the most active in this regard?
A. Interest towards organizing various sports events from various private companies in Georgia is definitely increasing.
Q. Is there any other sport which you think could be as successful as Media Rafting if handled properly?
A. Any type of sport could be interesting and attractive if organized properly. In the case of Media Rafting, we chose this sport due to its common features with our company – team spirit, dynamic, direct connection with nature and constant strive for leadership.
Q. How actively are you yourself engaged in sports and which direction does Lukoil sponsor the most frequently?
A. I myself prefer swimming.
Lukoil head office is actively engaged in supporting various sports events: football, volley ball, formula 1 racing.
In Georgia we’re active supporters of football and figure skating. Certainly rafting is also at the top of the list, where we have a women’s team and strongly believe they will be successful.
Q. As for the company’s healthy image promotion, what’s the beauty of its advertising campaign?
A. The fuel of the LUKOIL is of the Euro IV standard, which means that our production has minimum negative impact on the environment and human beings. In addition, our principles are based on healthy life promotion.
We are trying to show ourselves as a healthy company, which takes care not only of its customers but of the whole population.
Q. Recently Lukoil joined the United Nations Global Compact, a voluntary initiative to facilitate sustainable development and encourage businesses to adopt socially responsible policies. Back in 2006, Lukoil joined the Russian Businesses Social Charter, which is in connection with the UN Global Compact. What is the activity of Lukoil Georgia in this regard?
A. We have become actively engaged in social responsibility issues. Furthermore Lukoil is motivated to give a hand to entrepreneurship in the country, which is the next best step forward as far as Georgia’s economic welfare is concerned.
It should also be mentioned that the majority of the gas stations operating under the LUKOIL Brand name are local franchisees.
Q. What’s your annual budget for CSR activities and how do you see the role of big companies in making the lives of the needy healthier?
A. Lukoil spends solid finances on its CSR campaign including various social projects and charity events. Only a few of them get into the press though.
Lukoil has contributed to the improvement of the social environment in Georgia. It’s essential to be involved in various social projects in order to have an instant response to any challenges occurring in any direction.
At the same time long-term benefit derives from creating new jobs and investing in the less developed regions in Georgia.
Q. In terms of CSR inside the company, do you provide your staff with special insurance guarantees? Which insurance company do you cooperate with? How much does Lukoil spend in insuring the health of its staff annually?
A. All staff at the LUKOIL has medical insurance. We choose our partners according to terms and types of services they offer and their reliability. Safety and security standards are quite strict at the LUKOIL.
Q. In terms of environmental pollution how secure is the fuel sold at Lukoil filling stations, and how would you advise local drivers on how to reduce the risk of pollution?
A. The fact that Lukoil fuel meets Euro IV standards and has a minimum damage effect on the environment and people, speaks for the corporate strategy of the company.
Efforts made by separate companies in order to minimize environment pollution are not enough. Each and every member of the society must feel responsible in this aspect. I think health of our generation matters more than funds and finances.
Q. How negative could low quality oil be for automobiles and have Georgian drivers realised that yet?
A. High quality fuel and oil extend the exploitation period of vehicles while low quality products can have negative impact on an engine.
That is why I advise drivers not to save money on fuel, as the results may cost them more.
Q. Lately the price on oil has significantly increased worldwide, has the fact influenced the local population’s choice to switch to lower quality fuel?
A. Indeed, the increased prices on fuel have reflected sales figures, though our loyal customers stay devoted to the high quality our products have.
Q. A number of drivers have switched to gas consumption in order to save expenses. How safe do you regard gas-driven vehicles and could the fact influence Lukoil’s sales statistics as you’re targeted at fuel sales?
A. While speaking of safety measures I would mention a very interesting fact – no one from big auto manufacturer has launched vehicles working on gas so far. So I would say it is up to drivers themselves to make decisions.
Gas does have the ultimate advantage when it comes to the price, though it is far behind petrol and diesel in every other competitive feature.
According to our analysis, gas has no potential of replacing petrol in the near future and teh competition between them has been quite an insignificant so far.
Q. Recently Lukoil was named the best European oil and gas company in investor relations by buy-side analysts as a result of a survey carried out by the Institutional Investor journal among analysts from 500 companies. What’s Lukoil Georgia’s investor relations policy? What are the basic factors you stick to in this direction?
A. Our investment policy is in full coordination with the Head Office. Projects are prepared here and then sent to the head office for review and final decision.
Q. As we know women are present in the Board of Directors at LUKOIL. They also hold key managing positions such as Heads of HR and Financial Departments. Do you think women managers produce better results?
A. Women are women and they do what they believe they have to do. We live in a society where a person is free to make their own decisions.
Women are very talented and creative by nature. There are many examples of women bringing fresh and innovative ideas when it comes to decision-making and problem solving. Women have very well developed intuition, a so-called sixth sense that guides them and those around them.
Q. Who was the very first female employee at Lukoil and how was the idea of attracting beautiful representatives at the company greeted by Lukoil management from the very beginning?
A. Since the very first days of its development Lukoil Georgia had female staff members and it would not be easy to single out the first employee.
Q. Do you give any special surprises to the company’s female representatives on women’s day – March 8? What do you consider first in this case?
A. We take constant care of our staff regardless of gender and so we do not find it necessary to set certain days to please and comfort them specifically.
Q. Are there any special demands women drivers tend to have? How reasonable would it be to issue special Lukoil cards for women?
A. Women differ from men by their excessive attention to safety details and environmental issues.
It is quite possible to issue special cards for women, though we’ve not seen that demand yet from our female customers.
Q. What is the number of TBC Lukoil cards issued and what is the overall value paid by the cardholders thus far?
A. Following the project framework 7,000 TBC Lukoil VISA cards were issued. According to the data provided by our partner, the turnover of the project has made 1.4 million at the end of the 2007.
Q. Miss Georgia Irina Onashvili is the face of Lukoil Georgia. Who will be next?
A. We have not discussed any changes concerning Miss Onashvili yet.
Everything depends on the marketing strategy of the company.
Q. Lukoil is one of the leaders in regards to the number of filling stations. How professional are the staff you hire for construction works and how secure are your filling stations for the surrounding area?
A. The LUKOIL standards in regards to safety and environment protection are extremely strict. The same goes for our personnel. The selection of employees is conducted based on precise internal procedures.
The staff at the LUKOIL filling stations are regularly offered training courses on safety and service standards, in order for them to improve their skills and knowledge.
Q. As for healthy competition, what do you think are the advantages of Lukoil as far as healthy lifestyle is concerned?
A. Once again – our fuel does not pollute the environment. The style of our business, which is oriented on teamwork and social activities, is a prerequisite to our future success.
Q. How did you first get engaged in the oil business and what were and remain the major challenges in the sector to deal with?
A. I joined the LUKOIL in 2005 after having passed several interviews.
Managers are faced with the same dilemmas when it comes to complying with internationally recognized rules and regulations, tax regimes, lack of qualified personnel, modern technologies and access to information, and in none of those are oil companies an exception.
Written by Kate Tabatadze
