NET IMPACT VALUATION FOR OIL AND GAS EXPLORATION AND PRODUCTION INDUSTRY.

Abstract

Net Impact Valuation is a new practice to quantify the business impacts and value them in the monetary unit. It demonstrates a comprehensive of the business’s impact values, covering the economic, environmental, and social dimensions. This practice could help the organizations to have a better understanding of their impacts and guide them in strategic decision making. This research aims to study the concept and process of the Net Impact Valuation methodology and find the most applicable model to oil and gas exploration and production (E&P) industry, which is one of the vital global sectors with high impact potential. It is designed as applied research by mainly studying and analyzing the existing methodologies from (1) Ernst & Young Global Limited (EY), (2) KPMG International Cooperative (KPMG), and (3) PricewaterhouseCoopers International Limited (PWC), altogether with the principle and framework of World Business Council for Sustainable Development (WBCSD), and Social and Human Capital Coalition. Consequently, “the conceptual model of Net Impact Valuation” and the “Integrated model of Integrated Reporting framework and Monetization” are proposed to apply to the business, including oil and gas upstream. However, the key findings reveal that the monetization approach is not yet standardized and needs further study for the most efficient methodology application.