Group Sustainability Policy

Group Sustainability Policy September 2014 1. BACKGROUND 1.1. Definition Sustainability: Sustainability and sustainable development means encour...
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Group Sustainability Policy

September 2014




Definition Sustainability: Sustainability and sustainable development means encouraging economic growth while protecting the environment and improving quality of life - all without affecting the ability of future generations to do the same. Morgan Sindall Group plc. and its five divisions (the Group) take this definition a stage further splitting it into the components of PEOPLE, PLANET and PROFIT. The combination of these three elements forms the basis of the Groups sustainability agenda and aspirations.

Terminology such as CSR (Corporate Social Responsibility), Responsible Business, Triple Bottom Line, and Sustainable Development are considered interchangeable terms with essentially the same meaning. The Group will use the term „sustainability‟ to cover all these areas. 1.2.

Driver’s towards sustainable construction Government Policy and Incentives The Government has set itself the challenge of reducing its waste, water and carbon emissions by 2015 – the Greening Government Commitments. This programme also influences the way that the Government procures its public sector services (c. 16 percent of GDP). The public sector can influence the sustainability agenda through the way it procures goods and services, with a direct impact on customers with whom the Group works through tools such as Government Buying Standards and the Flexible Framework. Government and industry has combined through the Green Construction Board, as well as through other fora, to set the longer-term aspirations concerning the Low Carbon construction strategy and green construction issues. Longer-term strategic objectives also influence policy including “Construction 2025: Industrial strategy for Construction” which sets out a number of elements of its vision including “People: an industry that is known for its talented and diverse workforce” and also “Sustainable: an industry that leads the world in low-carbon and green construction exports”. Specific targets include „Lower Emissions: 50% reduction in greenhouse gas emissions in the built environment”.


Other cross industry-government initiatives such as the Infrastructure Carbon Review, launched in November 2013 with a target of cutting 24 million tonnes of carbon will have an impact as well as presenting opportunities on the Group‟s sustainability agenda. Responding to these Government-industry objectives can present opportunities through offering reduced embodied carbon, efficient buildings and whole-life costing.

Stakeholder Pressures Our stakeholders increasingly measure our performance with regard to sustainability issues, which imposes significant influence and pressure on the Group‟s ability to demonstrate its sustainability credentials for work winning purposes. The performance of the Group and communication to its stakeholders is becoming increasingly important to enable the Group to remain successful and to retain a reputation as a leading commercially sustainable business. The regulatory regime in the United Kingdom and Europe, in particular the planning process, is taking sustainability into account affecting both design and the controls required during construction. Failure to address these issues has the potential to cause delays and additional costs to projects, cause bad publicity and client relations, and ultimately lose competitive advantage.


The Group’s approach This Policy sets out the objectives through which the Group will develop and implement their supporting policies, systems, and manage their works in a progressively responsible manner. Measures have been set out in section 3. These have been selected to both demonstrate the steps the Group is taking in respect of sustainability as well as to drive continual improvement. It should be noted that these measures might change as the Group develops, the regulatory environment within which the Group operates and customer expectations change. A flexible approach has to be followed thereby allowing uptake of the sustainability strategy by the Group‟s diverse range of projects. The Sustainability Steering Group that is comprised of members of each division will oversee this Policy and the progress of the Group. The Steering Group will be supported by a series of stakeholder panels through challenge, and by providing guidance, advice and intelligence.



Sustainability policy Morgan Sindall Group plc. is a UK construction and regeneration group, operating in the public and commercial sectors, through five divisions of construction and infrastructure, fit out, affordable housing, urban regeneration and investments (the Group). The Group‟s is committed to continual improvement and ensuring that all its construction and regeneration activities are undertaken in a sustainable manner. Our „Total Commitment to Sustainability‟ detailed this Roadmap sets out the sustainability priorities for the Group. We are therefore committed to the following Total Commitments: People  

A safe work environment Developing talented employees

Planet  

Reducing energy consumption and carbon emissions Reducing waste

Profit  

Improving sustainable procurement Supporting local economic growth

As a minimum, the Group will adhere with all applicable legislation and standards relevant to its operations. It will manage its occupational, health and safety risks whilst seeking to minimise its impact on the environment, enhancing it where possible. The Group will actively seek to present a cutting edge differentiator position on sustainability issues. The Groups Sustainability Steering Group will manage the development and implementation of this policy, in conjunction with the divisions. We believe that maximising shareholder value over the long term is best achieved through an intelligent regard for all our stakeholders, and by acting with integrity and responsibility. Therefore, the Group will regularly consult through stakeholder panels and other appropriate mechanisms on its policy, strategy and performance. We will review this policy in response to changing material priorities and at least annually, and will publicly report our performance, in line with the Global Reporting Initiative guidelines. Every employee of the Group is expected to give their full cooperation to the successful implementation of their relevant division‟s detailed policies and procedures. Together we can drive our construction and operational practices towards a sustainable and responsible future.

Graham Edgell Morgan Sindall Group plc. April, 2014





Purpose To set out the Group‟s policy in relation to sustainability and for adoption by the Group‟s divisions.


Introduction This section sets out the background to our objectives, the targets and measures that we wish to monitor. Additional objectives and targets may be set in the future as the Group develops and its priorities change. The following sections will form the basis of the Group Roadmap to sustainability.



3.3.1. A safe work environment We will make sure, through proper training and education, that our employees are fully engaged and involved in improving safety in the workplace, at home, and on their journeys to and from work. In addition the goal is to minimise impact on the environment. We will also ensure that everyone understands the part they play in their own safety and that of their co-workers, as well as the wider community and the environment where we work. Objective: No lost time, or RIDDOR incidents or major environmental incidents Measures Total number of RIDDOR incidents (Number) Total number of major environmental incidents (Number) TARGET: zero incidents

3.3.2. Developing talented employees To help develop talent, we undertake to provide all employees with clear induction, appraisal and appropriate development programmes. Objective: Attract and retain talented people within the Group and to be the employer of choice in the construction sector. Measures Average number of training days per employee (Training days) TARGET: above median training days compared with industry/sector benchmark 3.4.


3.4.1. Reducing energy consumption and carbon emissions We will play our part in reducing emissions by targeting, as a minimum, a 5% year-on-year reduction in energy consumption. By building more efficiently, we will create more resource and energy efficient workplaces, housing, schools and offices and we will help clients to reduce their own emissions. Objective: Demonstrate a net reduction in operational carbon emissions across the Group Measures: Annual Group carbon emissions (tCO2e)


TARGET: as a minimum, a 5% year-on-year reduction in carbon emissions vs. baseline of 2010, and a 26% reduction by 2020 on 2010 baseline

3.4.2. Reducing waste We will improve resource efficiency, reduce the total amount of waste sent to landfill by 10% year-onyear and undertake to commit to recognised waste reduction schemes, as well as encouraging individual initiatives Objective Minimising waste generated throughout the Group with an aspiration of 100% waste recovery Measures Total amount of waste produced Total amount of waste produced that was diverted from landfill Percentage diverted and fate per waste stream of Construction, Demolition and Excavation TARGET: Reduce the absolute volume of waste sent to landfill by 10% year on year 3.5.


3.5.1. Improving sustainable procurement We aim to procure goods and services that minimise risks associated with procuring from vulnerable groups or sources and to implement best practice procurement standards. Objective Implement demonstrable sustainable procurement practices across our supply chain and in line with customer expectations Measures Percentage of total spend that is covered by Group-wide agreements. (% spend) Participation of the Group supply chain in the Supply Chain Sustainability School Number of materials of which sustainability screening assessments have been conducted of our direct-spend high-risk suppliers and goods where there is a perceived strategic exposure to the Group. TARGET: 25% of high risk materials assessed and sustainably sourced in 2014

3.5.2. Supporting local economic growth We aim to provide sustainable opportunities for local communities through engaging with local supply chain partners, employees and apprentices, and appropriate local and national not for profit organisations in order to contribute to local economic improvement Objective Through commercially sustainable construction activities, positively contribute to economic growth of the communities where we work Measures Measurement of local multiplier effect on applicable projects (£‟s), using the LM3 tool. TARGET: benchmarking of economic contribution



Materiality Supplementary Action Plan Following a stakeholder engagement exercise, based on the principles of the G4 standard of the Global Reporting Initiative, a series of supplemental material issues have been identified for action. These are set out in the following section.


People - supplementary

3.7.1. Community Engagement Construction activities can have a short-term negative impact on the communities where they occur. Active engagement and communications can result in a positive acceptance of the projects to the benefit of the community. Objective: Work in the community and minimise the potential negative impact of the Group‟s operations Measures Divisional Considerate Constructor Scores TARGET: 40 (2013 scoring scheme)

3.7.2. Inclusion and diversity Promoting a talented and diverse workforce to encourage new ideas, foster innovative practice and provide better services. Objective: To understand the diversity profile of the Group, and its supply chain partners, and to present opportunities to engage with the Group. Measures: Diversity profile of the Group‟s workforce (gender, age and ethnicity) as benchmarked against peer groups, e.g. UKCG TARGET: Full benchmark across all divisions Training for all employee in understanding diversity and inclusion

3.7.3. Recruitment and Retention Maintaining a stable level of employee turnover is an indicator of employee satisfaction, whilst enabling the in-flow of new talent and skills to the Group Objective: Maintain a balance in terms of attracting new talent into the Group and the satisfaction of existing employees thereby minimising recruitment costs Measures: Total number and rates of new employee hires and employee turnover by age group and gender. TARGET: employee turnover rate reducing trend toward UK industry average 3.8.

Planet - supplementary

3.8.1. Sustainable building and labelling Playing our part in developing and delivering more sustainable buildings. 6|Page

Objective: Provision of commercially sustainable buildings and assets in line with customers‟ expectations Measures: Number of projects achieving BREEAM, CEEQUAL, LEED, SKA or other industry relevant ratings TARGET: internal benchmarking of the number of projects achieving these standards versus all projects undertaken

3.8.2. Transport We will manage our vehicle fleet, where directly controlled, to minimise its impact through energy use, emissions, nuisance, etc. Objective: Reduction of environmental impact (emissions) through selection and operation of vehicles that match or exceed emissions standards Measures: Fuel consumption of vehicle fleet Emissions from directly controlled vehicle fleet TARGET: reduction of emissions in line with the Group‟s carbon targets

3.8.3. Water and Effluents Tackling the use of potable water supply and effluents will minimise our impact on the environment. Objective: Fully understand how the Group uses water and seek to minimise its use and disposal as effluent Measures: Total quantity of water consumed (potable, purchased supplies) and discharged TARGET: to quantify total consumption and discharge levels normalised against revenue, across the Group 3.9.

Profit - supplementary

3.9.1. Advocacy and leadership We will be fully transparent in any relationship with Government or political parties Objective: Ensure the highest levels of integrity and transparency in any business dealings, including with political parties, and government agencies Measures: Value of political donations (£‟s) TARGET: zero expenditure on political donations (£‟s)

3.9.2. Customer feedback and satisfaction Engaging closely with our customers is the only way that we will fully understand satisfaction levels and expectations 7|Page

Objective: Establishment of the Customer Stakeholder panel to engage and seek positive contribution to the Group‟s sustainability strategy Measures: Number of stakeholder panel meetings per year. Percentage of completed projects achieving a perfect delivery or equivalent score TARGET: as set by the divisions

3.9.3. Ethical business, bribery and corruption Our aim is to ensure that all employees are aware of their roles and responsibilities towards ethical business practices. Objective: Execution of business practices to the highest ethical and moral standards Measures: Percentage of workforce trained on anti-corruption policies and procedures Number of legal actions taken for anti-competitive practices. TARGET: 100% of workforce trained in anti-corruption and bribery act requirements TARGET: no legal actions 3.10. People – Planet - Profit - supplementary 3.10.1.

Legal Compliance

Our aim is to ensure that all of the Group‟s operations strive towards the delivery of projects in line with current legislative requirements. Objective: Minimise reputational risks associated with nonconformance with legislation Measures: Value of monetary fines (£) and enforcement actions taken (Number) TARGET: no fines


PROGRAMMES TO ACHIEVE OBJECTIVES The Group will review the requirements of this Policy and develop achievable timescales for achieving the defined objectives. The progress and measures will be reported at each Sustainability Steering Group forum by the divisions and communicated to all employees via the Group‟s intranet.



Structure, Roles and Responsibilities

Stakeholder Panel

Group forum

Steering Group

Divisional forum

Graduate forum

Supply chain panel

Delivery of the Group‟s sustainability strategy rests with both the Director of Sustainability and Procurement and the Group Head of Sustainability. These two individuals will play a role in each of the following groupings thereby providing a consistent approach. 5.1.

Steering Group

The Steering Group, chaired by the Director of Sustainability and Procurement, brings together individuals with a variety of roles from across the Group. It will develop and drive the Group‟s strategy, establish objectives and targets and progress the Group‟s Roadmap. It will also ensure that the Group adopts a consistent approach and shares good practice across its divisions. The Steering Group will also act as the focal point and interface for the other panels and fora, acting as the common interface. 5.2.

Stakeholder Panels

The Group intends to establish two external panels – its supply chain panel and a customer stakeholder panel. The supply chain panel will comprise representatives of the Group‟s major supply chain partners and the customer stakeholder panel will comprise a selection of the Group‟s clients. Both panels will act in the capacity of „critical friends‟ to the Group, providing advice and insight on the Group‟s sustainability strategy and performance as well as guidance on developments across the wider sustainability agenda. An independent chair will be appointed to lead both these panels. Both panels will meet separately and at least twice in each calendar year. 5.3.

Group forum

This Group forum will solely comprise a senior leadership team from across the divisions as well as nonexecutive directors of the Board as appropriate. The objective of this Group forum is to reflect on and challenge the sustainability strategy in the context of the Group‟s wider business strategy and thereby ensuring alignment. The panel will meet twice per year and will be chaired by the Director for Sustainability and Procurement. 5.4.

Graduate forum


Understanding and reflecting the views of the Group‟s graduates and up-coming talent is important in providing different perspectives to the sustainability agenda, not least of all in terms of effective communication. This graduate forum will comprise nominated representatives from the divisions with the objective of challenging the Group‟s approach to sustainability. This graduate forum will also be tasked with projects to examine elements of the wider sustainability agenda and to propose new and innovative ways of working that could be adopted by the Group in the future. This forum will also meet twice per year; however, more frequent meetings may take place as projects require. The chair of this panel will be nominated from within the forum. 5.5.

Divisional Forum

Each division is expected to convene its own sustainability forum to expand upon and deliver the Group‟s sustainability strategy, as relevant to its client base and work streams. It is for each division to determine how these forums should be constituted and run; however, inclusion of the Director of Sustainability and Procurement and Group Head of Sustainability should be taken into account.




Internal Reporting

Communication of sustainability performance will be achieved through several mechanisms:      


Quarterly reporting of performance metrics from each division that will published on the Group‟s intranet, Issue of quarterly copies of the internally focussed „Today‟ newsletter, Issue of the monthly People-Planet-Profit E-newsletter, Production and sharing of sustainability case studies, Production and sharing of sustainability focussed news stories, and Use of each Group‟s intranet to promote sustainability news to all employees across the Group.

External Reporting

The focus of the Groups external reporting will be based on the following avenues:     

Production of an annual sustainability report to GRI standards, Contribution and inclusion of a sustainability review in the Group‟s annual report and accounts, The sustainability section of the Group‟s web site which will include sustainability news stories and case studies from across the divisions, Use of social media such as twitter, Linked In or other mechanism as deemed appropriate, and Presentations at conferences, industry groups, etc.

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