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BUSINESS REVIEW > Environmental, Social and Governance |
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environmental, social and governance |
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At SEGRO corporate responsibility is fundamental to the way in which we do business. Our strategy is to embrace our company policies and focus on our relevant financial, economic, social and environmental risks and opportunities. We continuously strive to enhance our relationships with stakeholders, treat our employees, suppliers and the communities where we operate as long-term partners, and achieve the highest possible safety standards whilst considering the sustainability impacts of what we do.
How we manage corporate responsibility
SEGRO has a corporate responsibility policy statement, and continuous improvement lies at the heart of our corporate responsibility management strategy. Our Group Risk and Responsibility Committee constantly reviews what we can do better to help our key stakeholders and maintain our competitive advantage. The components of our corporate responsibility management system are:
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Ian Coull, Chief Executive is the Board member with overall responsibility for corporate responsibility. The committee consists of senior executives who are responsible for corporate responsibility management within their areas of responsibility.
SEGRO’s commitment to corporate responsibility is to ensure that all business processes, procedures and reporting reflect current best practice wherever possible.
Each year we identify a number of targets to track our corporate responsibility progress, evaluate our success in managing material issues and, where possible, compare performance against industry peers.
Our performance against these targets will be disclosed in our forthcoming corporate responsibility report, both in print and on the SEGRO website. A full list of our targets for 2008 will also be available on our website.
SEGRO participates in several benchmarking indices such as FTSE4Good, Dow Jones and the Business in the Community (BITC) Environmental index.
We aim to behave ethically and strategically manage risk. We have a Business Ethics Code in place to strengthen our commitment to integrity and responsible business practice.
We are constantly working to improve corporate responsibility-related activities across the Group and, as SEGRO continues to expand, we seek to address challenges by further embedding our corporate responsibility commitments across the business. We have recently appointed a Head of Sustainability to lead a new, dedicated function. The aim of this function is to raise sustainability to a new level, embedding it in all aspects of the way we do business – Environmental, Health & Safety, Corporate and Social Responsibility and beyond.
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Sustainability and Environment
The Group takes a considered approach to the important issue of sustainability and the management of our environmental impacts. We have implemented an Environmental Management System across our Continental European operations to ensure a uniform approach in the management of our environmental impacts such as energy use, waste management, use of natural resources and bio-diversity.
In collaboration with the Carbon Trust we have produced a measurement tool to evaluate the carbon footprint of our industrial estates with a view to setting ongoing improvement targets. We also participated in the Carbon Disclosure Project, disclosing our Group-wide carbon emissions.
With the implementation of the new European Energy Performance of Buildings Directive, we continue to look at innovative technologies to improve the energy performance on our new developments and also our existing properties. We will do this by measuring and recording the energy performance of all our buildings, which is over and above that required by the European Energy Performance of Buildings Directive.
Incorporating technologies such as photovoltaic panels, the use of ground source heat pumps and green roofs, we are working to ensure our buildings are both sustainable and energy efficient in the future.
Together with our customers we are ensuring that our buildings are used in the most energy efficient manner. With the Carbon Trust, we will arrange energy audits for our high energy dependent customers’ with advice on how to make improvements.
We also engage with our frontline suppliers (consultants and contractors) to raise awareness of our approach to environmental issues. We do this by holding environmental workshops annually and agreeing a consistent approach with our suppliers throughout our development programme.
Our most significant sustainability and environmental impacts arise from the built environment. We therefore give particular emphasis to the following aspects of our projects: |
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Improving the energy efficiency of our new and existing buildings by cost effective and innovative design solutions |
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Integrating flexibility and adaptability into design, thereby ensuring our developments meet or exceed planned life expectancy |
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Minimising pollution to air, land and water throughout the construction process |
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Improving natural resource efficiency by reducing the use of non-renewable natural resources, both in construction and in use |
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Throughout our construction activities, we have committed to reduce waste to landfill by 50 per cent by 2012 |
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More details are available in our separate Corporate Responsibility Report. |
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SEGRO's Annual Accident Incident Rate
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Health and Safety
Health and Safety remains one of our highest priorities. We focus on continuous improvement by ensuring that safety performance is reported and recognised across the Group. Our policies, procedures and standards are under constant review to ensure that our employees and visitors operate in a safe and healthy environment.
2007 saw a complete review of our Health and Safety policy. As part of this review we introduced a Health and Safety management system, which can be audited to ISO 18001 standards, across our UK operations. A SEGRO Health and Safety policy booklet was issued to all employees. A computer-based Health and Safety awareness training system was introduced to the UK and all employees completed the training (see graph). We continue to ensure a positive Health and Safety culture by auditing our performance and sharing information and best practice across the Group, focusing on communication and by active involvement of our senior executives. Ian Coull is the appointed main Board Director with responsibility for Health and Safety.
In 2007 there was a considerable focus on Health and Safety standards throughout our Continental European operations. This required a detailed review of European Health and Safety legislation and how it should be applied across countries. We undertook a Health and Safety audit across all Continental European operations and the results of this have helped us to set Health and Safety targets and priorities for 2008. A Health and Safety representative has been appointed for each country. This has enabled a local focus for Health and Safety whilst allowing improved communication between Continental Europe and the UK. |
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UK Health and Safety Awareness Training 2007
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| Sustainability Targets |
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Improve energy ratings of existing stock during major refurbishments |
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Reduce construction waste to landfill by 50 per cent by 2012 (with an interim target of 25 per cent by 2010) |
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Trial the use of photovoltaic panels on two SEGRO properties across Continental Europe |
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Ensure zero pollution incidents during construction activities |
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We continue to measure ourselves against targets for work related fatalities, reportable incidents, and instances of non-compliance with Health and Safety legislation.
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People
2007 has been a busy year in terms of our people agenda. It has seen significant progress in terms of our learning and development programme, the expansion of Human Resources best practice across our Continental European operations and also some significant business changes, which has resulted in a reduction in the number of employees within the Group.
As we have previously reported, during 2007 we disposed of our business in the USA and sold our interest in the Slough power station. In the USA, all of our employees transferred to the new owner HCPI. At the end of December we completed the sale of Slough Heat & Power to Scottish and Southern Energy plc (SSE). Whilst we have always offered personal and development opportunities to Slough Heat & Power employees, in SSE they have joined a key player in the energy industry who can offer them a far wider range of opportunities.
As a result of the sale of Slough Heat & Power, in the UK employee numbers reduced by more than a third.
Across our operations in Continental Europe we have made significant progress with our people agenda in 2007. We have now established a Human Resources function based in our Continental European head office in Paris. This function is responsible for providing specialist human resources advice and support to those countries where we have a presence. We believe this is a key development given the expansion we have planned for Continental Europe in the coming years.
We now have a Group-wide approach to how we reward our employees having successfully extended our remuneration policy to our European operations during 2007. In previous years’ bonuses were paid to Continental European employees on a discretionary basis. Most of our Continental European employees now participate in our Group bonus arrangements. Bonuses are only paid to employees on achievement of a number of performance based targets. We consider this to be a key step forward in continuing to develop a performance driven culture across our business which helps to keep employees focused on achieving targets as well as managing costs.
During 2007 we started to benchmark the salaries paid to our Continental European employees against market and country specific data. This is consistent with the arrangements we have had in place in the UK for a number of years. In order to ensure that this data is robust we participate in an annual survey which captures the salary data for employees working in property development roles in countries across Continental Europe.
Leadership development continued to be a significant theme for us during 2007. In 2006 we introduced our new Leadership Development programme. This bespoke programme focuses on the development of leaders rather than managers and provides our leaders with the necessary skills to drive our business forward. We feel this is fundamental to the overall success and profitability of our business. In 2007 we continued to run this programme and further courses are scheduled for 2008.
At SEGRO we take succession planning very seriously and seek to identify individuals who we believe have the skills and aptitude to develop further within the organisation. We help to identify their development needs and through mentoring and coaching we provide them with the opportunities to develop their career paths.
In our business we commit to measuring employee engagement at least every two years. We conducted our last employee engagement survey in autumn 2006 when the overall employee engagement was 57 per cent – this is against a benchmark figure of 37 per cent for UK companies (Source: Hewitts). We have focused on taking forward the results of the 2006 survey and used these results to actively inform our people agenda.
As a result of the survey we are now much more active in helping employees to plan and manage their career development. This is supported by our annual performance review process, attendance on the leadership programme and the recent restructure in the UK business has created a number of opportunities for career progression.
The engagement survey also identified that employees would like more information about the business with regards to its organisational goals, direction and performance. To address this, Ian Coull hosts an all-employee briefing four times a year. These presentations have been well received and will continue to form a key part of our employee communications in 2008.
2007 was a year of significant progress for our business which would not have been achieved without the drive, commitment, loyalty and energy of our employees.
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Suppliers
SEGRO works with a broad number of suppliers ranging from property managers to building contractors. Our relationships with our suppliers are built on honesty, fairness and mutual trust.
We are currently undertaking a review of our approach to procurement. It is a key business activity and a key enabler to helping us deliver even greater efficiency and productivity within the business.
We have developed a Code of Business Ethics which extends to our relationship with suppliers. We are committed to strengthening our relationships with our suppliers. In 2008 we plan to introduce electronic procurement technologies and modernise the way in which we purchase goods and services from suppliers. These changes should improve efficiency and effectiveness for both SEGRO and our suppliers’ business operations, as well as demonstrating how much we value our relationships with them.
At all times we respect the confidentiality between the Group and its suppliers. We actively promote and encourage developing relationships with suppliers who demonstrate a commitment to meeting socially and environmentally responsible behaviours.
Several times a year we hold workshops with our suppliers to explain the standards we expect them to meet in terms of our commitment to the environment. These workshops have proved exceptionally popular and help to generate a better understanding between all parties.
Additionally we expect our suppliers to ensure they uphold high standards of corporate and ethical behaviours at all times.
In 2008 we will continue to develop our capabilities to verify that our suppliers are commercially sound, legally compliant, and maintain appropriate health and safety certification to minimise Group supply risks. Compliance and delivery of a consistent quality of goods and services are important to ensure that we maintain our reputation and are able to meet our business requirements. Our aim in 2008 is to collaboratively agree targets with our suppliers to embed sustainability and continuous improvement in our supply base as much as is practical.
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Community
The Group continues to recognise its responsibilities towards the communities in which it operates in the UK and Continental Europe. Although historically we have concentrated our community support in the Slough area, we began in 2007 to reallocate resources further afield. The Charitable budget for 2007 was £400,000.
Our community programme includes building long-term relationships with local partners to deliver a shared objective; establishing strong, safe and healthy communities by investing time and resources into projects that directly address local needs. Amongst the programmes we have supported were the Kings Norton Restoration Project in Birmingham, PITSTOP in Slough and Young Enterprise in Hampshire. The Group was a major sponsor and helped organise the Slough Skills Summit part of the Skills Strategy for Slough campaign; the keynote speaker was Rt Hon John Denham MP, Secretary of State for Innovation, Universities and Skills.
During the year Business in the Community facilitated a ‘Seeing is Believing’ programme in Slough for our senior executives. Amongst the organisations visited were Herschel Grammar with whom the Group has been working for many years, PITSTOP an intervention project based on the Slough Trading Estate and SHOC (Slough Homeless Our Concern) a homeless centre in Slough. As a result of the visit the Group is now committed to support these organisations both financially and in kind.
Many of our employees take part in a number of our Employee Volunteering Schemes. These included work on a Willow Garden at Thames Valley Adventure Playground- a project for children with special needs, help at the Rainbow Centre at Fareham-a specialist centre for children with cerebral palsy and a project with Groundwork to renovate a garden at a residential home in Slough for adults with learning disabilities.
The Group continued to support programmes that help young people such as The Prince’s Trust and the Outward Bound Trust and through our support for the Construction Youth Trust the disadvantaged who wish to enter the construction and built environment sectors. Towards the end of 2007, we launched with Creative Junction the SEGRO Young Artists programme for schools in the Thames Valley. Five schools have been picked to be paired with a professional artist who will work with teachers and students to develop art work with a ‘world of work’ theme. Our aim is to widen our partnership nationally over the next two years.
In 2007 we distributed £24,000 to four charities: the Slough & London Run, Padstones, Slough District Scouts and the Acorns Children’s Hospice in the Midlands.
In 2008 the Group will continue with its community programme with an increased emphasis in areas away from Slough and in Continental Europe. Much of the community programme will be devolved to Regional Directors and Country Managers in Continental Europe. We have redrafted our policy for charitable giving that is now more focussed on a smaller number projects and encourages a more active participation from our employees. The 2008 Charity of the Year will be Dogs for the Disabled. |
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