Climate Change Data

Environmental Metrics

ESG Focus Areas

• Good health and wellbeing
• Clean water and sanitation
• Industry, innovation and infrastructure
• Sustainable cities and communities

Environmental Achievements

• Three-year CO2e intensity target met for the third consecutive three-year period.
• Further reduction in CO2e intensity targeted for a supplementary year while evaluating setting a science-based target.

Social Achievements

• Launched our first ever global campaign, Gift of Sight.
• Screened over 1,800 employees for sight-threatening conditions and raised more than US$100,000 for the Himalayan Cataract Project.

Governance Achievements

• Updated Code of Conduct, translated into nine languages.
• Updated Health & Safety Policy to reinforce the Board’s ‘tone from the top’.

Climate Goals & Targets

Environmental Challenges

• Reducing energy consumption and absolute CO2 emissions while growing an international business through acquisition and portfolio expansion.
• Increasing gender and ethnic diversity on all leadership teams.

Mitigation Strategies

• Set a target of reducing total carbon emissions relative to revenues by 10% over consecutive three-year periods (achieved for three consecutive periods).
• Exploring a new approach to long-term carbon targets, setting them in line with climate science.
• Prioritising increasing gender and ethnic diversity on all leadership teams.

Supply Chain Management

Responsible Procurement

• Conflict Minerals policy

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: CDP Climate Change, FTSE4Good Index, UN Sustainable Development Goals (SDGs)

Certifications: ISO 14001, BS OHSAS 18001

UN Sustainable Development Goals

• Goal 3: Good Health and Well-being
• Goal 6: Clean Water and Sanitation
• Goal 9: Industry, Innovation and Infrastructure
• Goal 11: Sustainable Cities and Communities

Halma's purpose and products align with these SDGs.

Sustainable Products & Innovation

• Water leakage detection and wireless monitoring
• Gas emissions monitoring
• Water and effluent analysis
• Ultraviolet (UV) water treatment
• Optical sensing

Awards & Recognition

• 2018 Learning Technologies Awards: Best use of social and collaborative learning technologies
• 2019 Learning Awards: Silver award for ‘External Learning Solution of the Year’

Environmental Metrics

ESG Focus Areas

• Environment
• Health and Safety
• Diversity and Inclusion
• Supply Chain Risk

Environmental Achievements

• Improved CDP rating to ‘Management B’ from ‘Awareness C’
• Met CO2e intensity target
• Entered into renewable electricity and gas contracts to reduce annualised carbon emissions by over 2,000 tonnes by the end of 2022
• Set an ambition to move all UK sites to REGO certified electricity and ‘Green’ gas over the next two years
• Commenced a group-wide review of electronic waste, aiming to reuse or recycle more than 99% of electronic waste

Social Achievements

• Completed an analysis of modern slavery risks across the global supply chain
• Completed first-ever global community campaign, Gift of Sight
• Continued the drive for diversity and inclusion across all levels of the workforce
• Maintained long-standing status as a constituent of the FTSE4Good Index
• Health and safety performance remained strong with an Accident Frequency Rate of 0.06

Governance Achievements

• Commenced preparations to disclose in line with the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) by 2022

Climate Goals & Targets

Environmental Challenges

• Reducing energy consumption and absolute CO2 emissions while growing an international business through acquisition and portfolio expansion
• Impact and disruption to businesses from the COVID-19 pandemic
• Challenges in the supply chain as a result of the COVID-19 pandemic

Mitigation Strategies

• Set a target of reducing total carbon emissions relative to revenues by 10% over consecutive three-year periods (achieved consistently)
• Extended carbon intensity reduction target for a further year ahead of adopting a new long-term carbon reduction target
• Developed a Travel Policy to reduce business travel and Scope 3 emissions
• Implemented a Company Car Policy to cap CO2 emissions for company-owned vehicles
• Deferring implementation of Science Based Target until 2021 financial year due to COVID-19 impact
• Methodology for risk identification established as part of the modern slavery risk mapping exercise

Supply Chain Management

Responsible Procurement

• Code of Conduct
• Anti-corruption and anti-bribery laws compliance
• Conflict Minerals policy

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: CDP Climate Change, FTSE4Good Index, Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, GHG Protocol Corporate Accounting and Reporting Standard, Environmental Reporting Guidelines (March 2019), TCFD

Certifications: ISO 14001, BS OHSAS 18001 (some companies), ISO 45001 (future target)

UN Sustainable Development Goals

• SDG 3: Good health and well-being
• SDG 6: Clean water and sanitation
• SDG 9: Industry, innovation and infrastructure
• SDG 11: Sustainable cities and communities

Over two-thirds of Halma's revenue supports these SDGs; acquisitions made in the year are even more highly aligned, with over 90% of acquired revenue contributing directly.

Sustainable Products & Innovation

• Water leakage detection and wireless monitoring
• Gas emissions monitoring and detection of leakage from natural gas pipelines
• Water and effluent analysis
• Ultraviolet (UV) water treatment and optical sensing

Environmental Metrics

ESG Focus Areas

• Climate Change
• Circular Economy
• Diversity, Equity and Inclusion

Environmental Achievements

• Increased renewable energy from 8% to 15% of electricity consumed.
• Set a 1.5 degree aligned Scope 1 & 2 2030 GHG emissions reduction target and commitment to net zero Scope 1 & 2 emissions by 2040.

Social Achievements

• Committing to paying the Real Living Wage in UK operations from 1 June 2022.
• Global implementation of an equal parental leave policy.
• Continued progress on gender diversity within our workforce.
• Extremely strong Health and Safety performance, alongside mental health and employee wellbeing initiatives.

Governance Achievements

• Launching our Sustainability Framework.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to climate events
• Short leases on the majority of buildings
• Decentralised nature of operations where contracts are managed at the individual company level
• Lack of appropriate knowledge and skills required to identify, evaluate, pursue and deliver on low-carbon opportunities.

Mitigation Strategies

• Agility within the business model to respond quickly to changes in supply chains.
• Active M&A strategy to access new markets and technologies for the low-carbon transition.
• Energy efficiency measures, self-generated renewables, purchased renewables, transitioning vehicle fleet towards electric vehicles and low-carbon heating sources.
• Focus on growing and attracting talent to identify and rectify gaps in strategic knowledge.
• Utilizing partnerships and investments to explore new and adjacent technology and markets.

Supply Chain Management

Supplier Audits: Varying approaches depending on company and supplier, including on-site visits and remote auditing.

Responsible Procurement

• Procuring materials in line with ethos, Code of Conduct, and Conflict Minerals policy.
• Identifying potential risks with direct and indirect suppliers.
• Assessing material environmental impacts within the supply chain.

Climate-Related Risks & Opportunities

Physical Risks

• Business and supply chain interruption or costs

Transition Risks

• Regulatory landscape changes
• Skills and information gaps

Opportunities

• M&A strategy to access new markets and technologies
• New products and markets
• Increased regulation driving growth

Reporting Standards

Frameworks Used: TCFD, SASB

Certifications: ISO 14001, ISO 9001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 3
• SDG 6
• SDG 9
• SDG 11
• SDG 7
• SDG 13
• SDG 5
• SDG 8
• SDG 10
• SDG 12

Halma's technologies and business practices contribute to these goals through various initiatives described in the report.

Sustainable Products & Innovation

• Products that detect refrigerant and SF6 leaks; rupture disc products for industrial customers transitioning away from SF6; remote sensing calibration systems; safety and interlock solutions for clean energy projects; solutions that make chemical processes safer; testing and calibration products for hydrogen fuel cell applications; recycling solution for aluminium; infrared sensors for predicting and extending shelf-life of fresh produce.

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Driving growth in sustainability
• Supporting our people (Diversity, Equity, and Inclusion)
• Protecting our environment (Sustainable product design and reducing emissions)

Environmental Achievements

• 47% reduction in Scope 1 & 2 emissions by 2023 from 2020 baseline
• 62% renewable electricity by 2023
• 10% increase in energy productivity in 2023

Social Achievements

• Progress towards 40-60% gender balance on company boards by end 2024 (29% achieved by end 2023)
• Various initiatives at SunTech Medical to increase employee diversity and improve employee experience

Governance Achievements

• Incorporation of emissions reduction and DEI progress into executive remuneration since 2023
• Continued commitment to transparency in reporting

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to extreme weather events
• Increased costs from carbon pricing and constrained material availability
• Meeting increasing stakeholder, regulatory, and reporting expectations within a decentralized business model
• Estimating and managing Scope 3 emissions (98% of total GHG footprint)

Mitigation Strategies

• Companies continue to manage their supply chains, supported by Group Growth Enablers
• Scope 3 emission measurement and target setting
• Continued commitment to transparency in reporting
• Developing reporting plan and capabilities to update Scope 3 figures regularly and setting appropriate reduction targets

Supply Chain Management

Responsible Procurement

• Code of Conduct
• EcoVadis supply chain initiative

Climate-Related Risks & Opportunities

Physical Risks

• Supply chain disruption due to extreme weather

Transition Risks

• Supply chain risks from low-carbon transition
• Business model and communication risks from changing stakeholder expectations

Opportunities

• Growth in markets for clean water leak detection, stormwater management, energy efficiency, refrigerant detection, methane detection, renewable energy, and energy storage

Reporting Standards

Frameworks Used: TCFD

UN Sustainable Development Goals

• SDG 3
• SDG 6
• SDG 7
• SDG 8
• SDG 9
• SDG 11

Products and services contribute to various SDGs, including health, clean water, clean energy, decent work, industry, innovation, and sustainable cities

Sustainable Products & Innovation

• FirePro's non-pressurized fire suppression system
• Palintest's redesigned Pooltester with recycled materials

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity, Equity, and Inclusion (DEI)
• Environmental Footprint Reduction

Environmental Achievements

• Reduced Scope 1 & 2 emissions from 18.9 ktCO2e in 2020 to 8.5 ktCO2e in 2024.
• Increased renewable electricity consumption to 71% in 2024 from 8% in 2020.
• Improved energy productivity by approximately 19% from 2022 baseline while revenue increased by approximately 19%.

Social Achievements

• Embedded metrics in leader bonus incentives: 5% based on DEI (achieving 40-60% gender balance on company boards) and 5% based on climate change (improving energy productivity).

Governance Achievements

• Requires each Halma company to create an individual Sustainability Action Plan (SAP) with goals and actions to reduce Scope 1 & 2 emissions.

Climate Goals & Targets

Environmental Challenges

• Most premises are leased, not owned.
• Decentralized business with contracts and suppliers managed at the individual company level.
• Limited influence over suppliers and customers in Scope 3 emissions reduction.
• Expected organic growth making absolute emissions reductions challenging.
• Limitations to product design changes due to high regulation and certification.

Mitigation Strategies

• Bottom-up approach to sustainability action plans, allowing companies autonomy in setting mid-term goals and near-term actions.
• Group-level target and ambition setting, providing resources, support, training, and sharing platforms.
• Multi-year approach to developing bottom-up Scope 3 decarbonisation plans.
• Development of a sustainable design toolkit for use across Halma companies.

Supply Chain Management

Responsible Procurement

• Supplier sustainability programs and commitments

Climate-Related Risks & Opportunities

Opportunities

• Growth opportunities in low-carbon transition and adaptation to changing climates

Reporting Standards

Frameworks Used: TCFD

Sustainable Products & Innovation

• Sustainable design toolkit; examples of redesigned products with recycled materials and improved energy efficiency.