Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Net Zero Emissions
• Water and Waste Reduction
• Sustainable Transport
• Inclusion and Diversity
• Corporate Citizenship
• Stakeholder Engagement
• ESG Transparency and Disclosure

Environmental Achievements

• Saved 1,500 MWh of electricity (equivalent to the average annual electricity consumption of 400 UK homes) and reduced CO2e emissions by 350 tonnes since datacentre move in June 2020.
• 43% reduction in fossil fuel consumption and a reduction in carbon emissions from trial of solar pods to power temporary accommodation at remote sites.
• Reaccreditation to the Carbon Trust Standard for Babcock’s UK-based operations.

Social Achievements

• Improved employee diversity; set an ambitious target to increase the proportion of women in senior leadership team from 21% to 30% by March 2025.
• Evolved community outreach activities to foster take-up in STEM subjects for younger audiences and address diversity disparity.
• Launched an agile framework for flexible working arrangements.
• Increased employee communications during COVID-19 pandemic (weekly CEO vlog, ‘Ask David’ initiative, Babcock app).

Governance Achievements

• Significant changes to Group governance at Board level.
• Reworked approach to risk management.
• Changed governance of contract bids.
• Demonstrable improvement in Dow Jones Sustainability Index score (overall increase of 17 points versus last year).

Climate Goals & Targets

Environmental Challenges

• Increased energy consumption within employees’ homes due to COVID-19.
• Need to improve data capture for emissions from non-UK operations.
• Need to improve payment practices to suppliers.

Mitigation Strategies

• Assessing increased energy consumption and identifying opportunities to reduce impact.
• Implementing metering and monitoring improvements to capture data streams.
• Improving payment practices; average payment across the Group over the past six months to March is 29.6 days (improvement versus 34.5 days last year).

Supply Chain Management

Supplier Audits: Annual review of business-critical suppliers.

Responsible Procurement

• Group-wide Suppliers’ Code of Conduct.
• Aligning processes and standards to ISO 20400 (Sustainable Procurement).

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products and low-carbon enablement.

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Certifications: ISO 14001, ISO 27001, ISO 22301, Cyber Essentials Plus

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 7 (Affordable and Clean Energy)
• SDG 6 (Clean Water and Sanitation)
• SDG 12 (Responsible Consumption and Production)
• SDG 13 (Climate Action)
• SDG 14 (Life Below Water)
• SDG 15 (Life on Land)
• SDG 3 (Good Health and Well-being)
• SDG 4 (Quality Education)
• SDG 5 (Gender Equality)
• SDG 8 (Decent Work and Economic Growth)
• SDG 10 (Reduced Inequalities)
• SDG 17 (Partnerships for the Goals)

Various initiatives across the business support these SDGs.

Sustainable Products & Innovation

• Services within Cavendish Nuclear on critical nuclear power plants
• Liquid Gas Equipment’s low-carbon shipping solutions
• Fastblade turbine R&D

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate Change
• Biodiversity
• Employee Safety and Wellbeing
• Community Engagement
• Supply Chain Sustainability
• Inclusion and Diversity

Environmental Achievements

• Reduced emissions by 8.6% in 2022 and 12.9% against adjusted baseline.
• Submitted interim and Net Zero carbon reduction targets to SBTi.
• Developed detailed Carbon Reduction Plans across ten pathfinder sites.
• Developed a new Group e-training package ‘Curious about Climate’.

Social Achievements

• Reduced median gender pay gap from 11.8% to 9.6%.
• Launched a new Group Sustainability policy.
• Launched its first global and Company-wide Shadow Executive Committee.
• Improved safety performance with a reduction in serious accidents.

Governance Achievements

• Launched a new Group Sustainability policy.
• Launched its first global and Company-wide Shadow Executive Committee.
• Completed the Dow Jones Sustainability Index (DJSI) submission.
• Now compliant with 9 of the 11 TCFD disclosure requirements.

Climate Goals & Targets

Environmental Challenges

• Data limitations in accurately capturing emissions data across all operations.
• Maintaining and enhancing biodiversity across global operations.
• Reducing waste to landfill and eliminating avoidable single-use plastics.
• Attracting and retaining female talent in a male-dominated sector.

Mitigation Strategies

• Implementing metering and monitoring improvements to capture data streams.
• Conducting biodiversity assessments across significant sites.
• Developing waste management plans across significant sites.
• Implementing a Gender balance Action Plan (GAP).

Supply Chain Management

Responsible Procurement

• Sustainable Procurement Policy and Supplier Guide
• Annual due diligence on business-critical suppliers
• AI risk resilience solution for supply chain mapping

Climate-Related Risks & Opportunities

Physical Risks

• Riverine flooding
• Forest fire
• Extreme wind
• Soil subsidence
• Surface water flooding
• Freeze thaw
• Extreme heat
• Coastal inundation

Transition Risks

• Supply chain disruption
• Demand for LGE and Civil Nuclear services
• Demand for low carbon solutions for aircraft
• Shifting energy generation markets
• Technology adaptation
• Failure to decarbonise Devonport

Opportunities

• Development of ecoFGSS-FLEX® ammonia fuel gas supply system
• Increasing demand for bulk marine transportation of hydrogen
• Growing demand for capture, transportation, and storage of CO2
• Renewable energy installation at Rosyth
• Marine R&D programmes for green propulsion
• Development of zero-emission pumping appliance (ZEPA)

Reporting Standards

Frameworks Used: GRI Standards 2021, SASB Standards, TCFD

Sustainable Products & Innovation

• ecoFGSS-FLEX® ammonia fuel gas supply system
• Zero Emission Pumping Appliance (ZEPA)

Awards & Recognition

• 2022 Apprenticeship Development of the Year
• Best Integrated Marketing Campaign for Graduate programme at ‘The Firm Awards 2022’
• 2022 Regional STEM Hub Inspirational STEM Employer award
• 2022 National STEM Employer Award

Environmental Metrics

ESG Focus Areas

• Emissions Reduction
• Safety and Wellbeing of People
• Environmental Sustainability in Programme Design
• Community Engagement
• Supply Chain Collaboration

Environmental Achievements

• Validation of science-based targets by SBTi
• 28% of Babcock fleet now made up of Ultra Low Emission Vehicles (ULEV)
• Enhanced accuracy and completeness in Babcock’s Scope 3 footprint
• Conducted biodiversity assessments and drafted Babcock’s Nature Positive Roadmap
• Commenced delivery of renewable energy installations
• Development of Babcock’s Environmental Data Management System

Social Achievements

• 83% of employees believe Babcock is committed to employee health and safety (up from 81% in 2022)
• Gender pay gap narrowed from 9.6% to 6.7%
• Launched Group-wide Project Management graduate programme
• Established a dedicated External Engagement team to engage with the Devonport community
• 582 active STEM Ambassadors visited 708 schools
• Completed the three Commitment Phases of the Progressive Aboriginal Relations (PAR) programme

Governance Achievements

• Published updated Supplier Code of Conduct aligning with ISO 20400 principles
• 27.7% of total spend with SME suppliers (compared to 24% in FY23)
• Average payment term to suppliers reduced to 16.3 days (from 21.4 days in FY23)
• CEO appointed president of ADS Group and Babcock became a founding signatory of the ADS ESG Charter
• Signed the Defence Aviation Net Zero Charter
• Became a Pankhurst Partner for Women in Defence UK

Climate Goals & Targets

Environmental Challenges

• Increased Total Recordable Injury Rate (TRIR) and Days Away Case Rate (DACR) due to increased complexity of activities and number of inexperienced workers
• Supply chain disruptions due to increased climate-related regulation
• Potential flooding at Bristol Ashton Vale facility and extreme heat at three other sites
• Potential for reduced demand for LGE services under a 1.5°C warming scenario
• Need to decarbonise Devonport to meet targets

Mitigation Strategies

• Increased supervision levels and growth of experienced workers to reduce TRIR and DACR
• Broadened supplier analysis to 1000 key suppliers to map climate-related risks
• Updated tool to map supply chain against climate change indicators
• Implemented new spend management and supplier onboarding platform
• Updated Supplier Code of Conduct to incorporate sustainable practices
• Developing Carbon Reduction Plans and investigating renewable energy installations across sites
• Occupational health assessments and training to mitigate extreme heat risks
• Developing ammonia fuel gas supply system and CO2 transportation/storage solutions
• Monitoring changes in demand and conducting feasibility planning for new opportunities

Supply Chain Management

Responsible Procurement

• Updated Supplier Code of Conduct
• Sustainable Procurement Policy and Supplier Guide
• Integration of sustainability considerations into supplier processes

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events (flooding, extreme heat, etc.)
• Coastal inundation

Transition Risks

• Increased climate-related regulation
• Changes in energy generation markets
• Increased demand for low-carbon solutions

Opportunities

• Development of low-carbon products and services (e.g., ecoCO2® cargo handling system, ammonia fuel gas supply system, CO2 transportation/storage solutions)
• Increased demand for emergency services due to extreme weather
• Opportunities in renewable energy and energy storage

Reporting Standards

Frameworks Used: GRI Standards 2021, SASB Standards (updated January 2024), TCFD

Certifications: ISO 27001, ISO 22301, Cyber Essential Plus

Sustainable Products & Innovation

• ecoCO2® cargo handling system
• Ammonia fuel supply system
• CO2 transportation/storage solutions

Awards & Recognition

• Safety and Health Excellence Awards 2024