Climate Change Data

Environmental Metrics

ESG Focus Areas

• Energy management and environmental impact
• Employee health, safety, engagement, diversity, and inclusion
• Supplier and customer relationships
• Impact on local communities

Environmental Achievements

• Leased 17 vehicles, 71% of which were hybrid (bringing the Group's hybrid vehicle total to 56%)
• Introduced a warehouse robot designed to reduce travel time of warehouse operatives
• New Engineering Modification Centre implementing product lifecycle inspection to reduce waste disposal

Social Achievements

• Guaranteed full salary for all employees during furlough in April 2020
• Introduced an Employee Assistance Programme in February 2021
• Appointed Mental Health Ambassadors in April 2021
• Employee Engagement Score increased from 64% to 69%

Governance Achievements

• Established improved processes for health and safety at work
• Enhanced the functioning of various Board subcommittees
• Completed a full strategy review to create focus and provide a framework for the future

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic significantly impacting revenue and profitability
• Supply chain disruptions due to global events and Brexit
• Extended lead times as world's supply lines recover from COVID-19 disruption

Mitigation Strategies

• Took advantage of government furlough schemes, guaranteeing full salary in April 2020
• Adapted to video communications technology for remote work
• Invested in building inventory levels to mitigate supply chain challenges
• Worked closely with logistics partners to minimize supply chain disruption
• Retained a degree of stockholding in Ireland to avoid cross-Irish Sea delivery issues

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GHG Protocol Corporate Reporting & Accounting Standard

Sustainable Products & Innovation

• Warehouse Robot

Environmental Metrics

ESG Focus Areas

• Environment
• People
• Communities
• Governance

Environmental Achievements

• Increased hybrid and electric vehicle total to 72% (2020: 56%) across the Group.
• Reduced owned vehicle emissions by 83%.
• Sourcing packaging from Forest Stewardship Council (FRC) certified sources.
• Reduced CO2e per £100,000 of Revenue from 1.52 to 1.37 tonnes.
• On a like-for-like basis, a 46% reduction in emissions primarily driven by a significant fall in fuel consumption.

Social Achievements

• Appointed 15 Mental health champions across the Group.
• Introduced an Employee assistance programme (EAP) providing 24/7 mental health support.
• Completed the '5 to 1' project integrating four UK businesses into a single entity.
• Employs fourteen apprentices across the Group, with fourteen more planned for 2022.
• Set up an industrial placement scheme for university students.

Governance Achievements

• Established a Risk Committee.
• Enhanced Business Continuity planning.
• Revisited identified risks and formulated action plans.
• Appointed a Group Head of Health, Safety and Environment.
• Introduced a 'balanced scorecard' approach to the reward scheme.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions.
• Inflationary pressures.
• Brexit related challenges (specifically impacting sales to Ireland).
• COVID-19 pandemic impacts (site disruption, systems disruption, health & safety, people issues).
• Competition.
• Supply chain disruption due to the conflict in Ukraine.

Mitigation Strategies

• Built stocks to mitigate supply chain uncertainties.
• Cost base restructuring activities.
• Investment in inventory levels.
• Reviewing Irish sales strategy.
• Established a COVID working group.
• Off-site disaster recovery provision for IT systems.
• Investment in people, including HR and Operations Development.
• Developing e-business capabilities.
• Refining Health and Safety policies.

Supply Chain Management

Responsible Procurement

• Regular meetings with key suppliers.
• Focus on sourcing from respected UK and European brands.

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environment
• People
• Communities

Environmental Achievements

• Reduced average miles per delivery from 209 to 138 through delivery process remodeling.
• Increased hybrid and electric company vehicles to 79% (2021: 72%).
• Over 80% of power at Gloucester site generated by solar panels.
• Implemented product lifecycle inspections to reduce waste.
• Reduced Scope 1 emissions by 2.5% and Scope 2 emissions by 18%.

Social Achievements

• Established a new Learning & Development plan with technical training and leadership programs.
• Appointed 19 mental health champions across the group.
• Expanded share options to key operational and managerial staff.
• Implemented a refreshed Group Health, Safety and Well-being policy.
• Significant reduction in gender pay gap (both hourly rate and bonuses).

Governance Achievements

• Continued compliance with the Quoted Companies Alliance Corporate Governance Code 2018.
• Regular engagement with shareholders and stakeholders.
• Strengthened risk management processes and controls.

Climate Goals & Targets

Environmental Challenges

• Significant inflationary pressures impacting all aspects of the business.
• Lengthy and inconsistent supply chains.
• Reduced performance in Flowtech division.
• Goodwill impairment charge of £10.1m.
• Increased inventory levels to mitigate supply chain uncertainties.

Mitigation Strategies

• Measures taken to manage cost base, including headcount reduction.
• Improved inventory management strategies.
• Consolidation of warehouse activities and creation of Engineering Modification Centre.
• Passing on price increases to customers.
• Continued focus on cost reduction and improved customer service.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Working closely with key suppliers to develop strong mutually beneficial partnerships.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Electrification gaining traction in mobile markets, potential replacement of hydraulics with electromechanical solutions.

Opportunities

• Development of energy-efficient products and services.

Reporting Standards

Frameworks Used: Null

Certifications: ISO 9001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• 23% reduction in like for like carbon emissions
• Recycled 53,000kg of non-hazardous waste
• 13,000 litres of hazardous waste diverted from landfill
• Increased electric or hybrid vehicles in fleet to over 50%

Social Achievements

• Implemented a new senior leadership team with a 50/50 gender split
• Increased female leadership population by 50% at the next tier
• Zero RIDDOR reported incidents
• Increased near miss reporting by over 100%
• Launched and embedded vision, mission, values, and behaviours throughout the business
• Completed Talent Acceleration Programme (TAP) with ESG focused project
• Increased number of apprentices by 11
• Increased H&S training provision (IOSH & MHFA)
• Achieved Safe Contractor certification

Governance Achievements

• Initiated strategic review of all policies and processes across the organisation
• Adopting a 'One Flowtech' approach

Climate Goals & Targets

Environmental Challenges

• Weaker than expected revenue due to service disruption from 2022 business integration and market headwinds
• Higher than expected net debt due to investment in high-running products to recover service levels
• Ongoing customer service issues within product distribution (legacy from 2022 integration)

Mitigation Strategies

• Implemented Performance Improvement Plan to fix core basics and build a customer-centric platform for growth
• Simplified operating model and established a new Group Leadership Team
• Restructured GB sales organisation and introduced professional sales processes
• Improved fulfilment centre efficiency, increasing stock availability and reducing complaints
• Implemented digital strategy roadmap

Supply Chain Management

Responsible Procurement

• Strategic supplier partnerships

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD

Certifications: Safe Contractor