Climate Change Data

Environmental Metrics

ESG Focus Areas

• Health & safety
• Wellbeing of employees
• Employee engagement
• Reducing energy usage
• Climate change
• Reducing waste, emissions and water usage
• Improving diversity and inclusion
• Enhancing training and career development

Environmental Achievements

• Improved CDP rating to ‘C’
• Reduced CO2 intensity from 0.105 to 0.102 tCO2e/£ revenue
• Two-year contract to buy all UK electricity from renewable sources

Social Achievements

• Introduction of a Human Resources toolkit
• Modern slavery-based audit of all temporary worker providers
• Global Health & Safety Culture Survey score of 72%, 3% above industry average
• Workforce Advisory Panels continued
• Repaid COVID-19 government support in the UK

Governance Achievements

• Redefined company purpose to “Creating sustainable infrastructure and safe transport through innovation”
• Appointment of Leigh-Ann Russell as Non-executive Director
• New senior management structure and Executive Board established
• Revised risk management methodology
• New online risk management and reporting tool implemented

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting operations and demand
• Challenges in security businesses due to COVID-19 restrictions
• Global increases in steel costs
• Reduction in Government spending plans (slightly lower trend)
• Changes in global outlook and geopolitical environment (slightly higher trend)
• Increased competitive pressure
• Supply chain failure (slightly higher trend)
• Talent, development, diversity, recruitment & retention of key employees (slightly higher trend)

Mitigation Strategies

• Swift actions to manage costs and conserve cash flows
• Cost reduction and efficiency improvements
• Cash preservation measures
• Repayment of UK Government COVID-19 support
• Diverse portfolio of businesses
• Monitoring of UK businesses and effects of Brexit
• Exposure to longer-term infrastructure investment programs
• Strong positions in niche markets
• Agile and responsive businesses
• Superior products and high service levels
• Robust due diligence of supply chain partners
• Maintenance of relationships with key suppliers
• Contingency plans
• Business Continuity and Disaster Recovery plans
• Enhancement of IT security controls
• Due diligence protocols for acquisitions
• Post-acquisition integration plans
• Active encouragement of research and development
• Intellectual Property management
• Contractual protections and retentions in employment contracts
• Training and development programs
• Appropriate remuneration and benefits
• Recruitment process improvements
• Monthly health & safety reporting
• Regular audits
• Health & Safety Forums
• Culture of zero tolerance for health & safety violations
• External health & safety accreditations
• Code of Business Conduct
• Staff training on compliance
• Program of audits to review compliance
• Software solutions for trade and export compliance
• Externally hosted whistleblowing hotline

Supply Chain Management

Responsible Procurement

• Sanctioned Countries screening protocol
• Competition Law compliance program
• Conflict minerals policy

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: UN SDGs

Certifications: ISO 45001

UN Sustainable Development Goals

• Goal 6
• Goal 7
• Goal 8
• Goal 9
• Goal 11
• Goal 13

Creating sustainable infrastructure and safe transport through innovation

Sustainable Products & Innovation

• Solar powered solutions for work zone safety products
• Hot-dip galvanizing service
• Composite products with low embedded energy

Environmental Metrics

ESG Focus Areas

• Climate Change
• Environmental Management

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Greenhouse gas emissions and energy efficiency
• Sustainable products
• Health and safety
• Talent, development and engagement
• Diversity and inclusion
• Climate risks and TCFD
• Ethical conduct

Environmental Achievements

• 4,175 tonnes of CO2e reduced vs base year, scope 1 and 2
• 97% of UK electricity requirements were sourced through renewable energy certificates in 2023
• Scope 1, 2 and 3 targets were validated by the SBTi in December 2023
• Full scope 3 greenhouse gas emissions baselined and received limited assurance validation in June 2023

Social Achievements

• Launched a UK employee discount platform
• Continued focus on senior level succession, development of high potential individuals, and manager and supervisor training and development
• 60 active apprenticeships in place as at 31 December 2023 (9% increase compared to 2022)
• Established a steering group in 2023 for a Hill & Smith Women’s Network
• 61% reduction in the Lost Time Incident Rate to 0.43 (2022:1.1)

Governance Achievements

• Continued to maintain highest standards of governance
• Compliance with the UK Corporate Governance Code 2018 (except for the requirement that the roles of Chair and Chief Executive should not be exercised by the same individual)
• Implemented governance safeguards arising from the dual role of Executive Chair
• Completed the disposal of the final part of our loss making Swedish roads business, and in October 2023 we divested the trade and certain assets of Berry Systems, a small, loss making car park solutions business

Climate Goals & Targets

Environmental Challenges

• Challenging market conditions in the UK
• Cost-of-living pressures in the UK
• Disappointing employee engagement scores
• Higher energy and labour costs
• Slowdown in UK residential new build and repair, maintenance and improvement sectors
• Downturn in the UK galvanizing market
• Inflationary and budgetary pressures across central government and local authority customers
• One-off operational costs in US Roads business
• Non-recurring charges relating to certain UK businesses
• Global economic outlook and geopolitical environment
• IT Systems failure
• Increased competitive pressure
• Supply chain failure
• Product failure
• Climate change
• Failure to attract, retain and develop an appropriately diverse, skilled and experienced workforce
• Prevention of harm or injury to people
• Violation of applicable laws and regulations
• Failure to take advantage of product development and innovation
• Portfolio Management

Mitigation Strategies

• Focus on gaining market share and further operational efficiencies
• Focus on providing employees with regular recognition
• Development of local action plans to address areas identified for improvement in the recent engagement survey
• Pricing actions taken to cover higher energy and labour costs
• Focus on building volume in niche growth sectors
• Implementation of a comprehensive business improvement plan
• Diverse portfolio of operating companies with exposure to a range of markets and geographies
• Strong balance sheet with low leverage and mix of fixed and floating rate debt
• Products tested, approved and accredited by regulatory bodies
• Quality control protocols fully implemented and continuously monitored
• Contractual controls in place to minimise economic impacts
• Product liability insurance cover maintained globally
• Sustainability Committee to oversee and govern our carbon reduction plans and initiatives
• TCFD analysis to understand our risks and opportunities arising from climate change
• Climate scenario modelling to evaluate the threat from climate hazards
• Costed plan established to set out how we will achieve net-zero by 2040
• Insurance cover, continuity planning and extreme weather protocols in place to mitigate our exposure from physical risks
• Board level review of succession planning for senior leaders
• Training and development programme in place for supervisors and line managers
• Appropriate remuneration and benefits, together with bonus opportunities and incentive plans offered to employees
• Culture of zero tolerance in respect of health and safety violations promoted by the Board
• Appointment of UK and US Heads of Health and Safety
• Group Code of Conduct sets out required approach for all staff
• Staff training provided on Modern Slavery red flags, Anti-Bribery and Corruption and Competition compliance
• Entrepreneurial culture and autonomous structure to encourage innovation
• Acquisitions strategy brings innovative products and technology to our portfolio
• All potential acquisitions are tightly evaluated to ensure they fit within our purpose and core strategic goals
• Due diligence protocols deployed in relation to assessment of target businesses

Supply Chain Management

Responsible Procurement

• Regular interaction and assessment of performance/financial status of key suppliers
• Contingency plans in place throughout the supply chain

Climate-Related Risks & Opportunities

Physical Risks

• Damage to operations from extreme weather events
• Operational downtime due to severe weather conditions
• Difficult working conditions

Transition Risks

• Increased demand for renewable energy leads to reduced supply or an increase in the cost of purchasing renewable energy
• The introduction of carbon pricing across our key geographies increases both our manufacturing costs and the costs of raw materials

Opportunities

• Increased demand for sustainable infrastructure products
• Further innovation in new products and services

Reporting Standards

Frameworks Used: TCFD, SBTi

Third-party Assurance: Bureau Veritas (limited assurance)

Sustainable Products & Innovation

• StormStrong products
• Asset BaFix track ballast shoulder retention system
• Vibration isolation roof curbs

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities