Corporate social responsibility
Highlights of 2007
Our Workplace
– 3.7% reduction in injury rate
– 28.7% reduction in severity rate
– 68 sites with safety management system
– New injury database
Our Global Footprint
– New set of environmental KPIs
– 111 sites with environmental management system
– £424,904 charitable assistance
Our Marketplace
– Supplier/customer awards
– 96 sites with quality management system
– Improved response to CSR stakeholders
Governance/management
– New CSR Committee
– Full policy compliance
– Group-wide Code of Conduct & Ethics training
– Group Chief Risk and Control Officer appointed
Introduction
Social responsibility is an integral part of our business practices and plays a key role in our success. Tomkins has in place a governance framework comprising our Code of Conduct and Ethics, specific policies, control arrangements and reporting. This framework governs how we conduct the Company’s business. Supporting this framework is a set of values that are indicative of our corporate culture. These core values include:
– Our entrepreneurial spirit;
– Our dedication to quality, innovation, and customer service;
– Our commitment to operational excellence and continuous improvement; and
– Our support of citizenship.
We seek to achieve the highest possible standards throughout the Group, consistent with our obligations to our employees, customers, suppliers, providers of capital and the communities in which we operate, all whilst providing an acceptable return to shareholders. These standards, together with our policies, are applied uniformly across the Group, irrespective of location.
A summary of our progress and performance in 2007 is set out below. Our separate in-depth Corporate Social Responsibility Report is available for download from our website, www.tomkins.co.uk.
Corporate Governance
Tomkins’ Board continues to address the demands of the changing regulatory environment and places a strong emphasis on corporate governance in all its activities. Reflecting our commitment to social responsibility, the remit of the Health, Safety and Environment (‘HSE’) Committee was broadened at the end of the year to include other Corporate Social Responsibility (‘CSR’) matters and renamed the CSR Committee. This will ensure that Tomkins adequately vets all matters related to CSR and continues to provide stakeholders assurance of board-level CSR governance. The Committee’s modified Terms of Reference are available for download from our website.
Our Workplace: Health & Safety
The importance placed on health and safety by the Board and management of Tomkins is reflective of the belief that our commercial success is tied to strong health and safety performance. We aspire to achieve the same high safety standards throughout the Group, regardless of the type of operation or its location. We introduced global heath and safety standards in 2007, which apply uniformly across all operations. We also introduced for all locations an injury-reporting database that records specific injury details. This database can be used to analyse trends and implement programmes of corrective action. Our continued focus on safety has resulted in a 3.7% reduction in the incident rate and a 28.7% fall in severity rate in 2007 versus 2006. These improvements were achieved through the continuous efforts of all employees to make safety a way of life.
Additionally, we have been pursuing many voluntary preventive healthcare programmes and initiatives at the operating level. Going forward, employee wellness has been selected as one of our CSR focus areas for 2008.
Tomkins' safety performance
Our Workplace: Employees
In the workplace, our aim is to be an employer of choice. We believe there is a strong correlation between effective people practices and business success. We can improve the performance of the business by developing our employees to their full potential, by motivating staff appropriately and through prudent succession planning. Our Human Resources function operates on a decentralised structure, mirroring the organisation of the Group. This reflects our belief that localised teams, operating under common principles, are best equipped to deal with the varying cultures, operating structures and geographic locations that exist around the Group. It also helps foster local entrepreneurship, a key element in Tomkins’ culture.
Each company in the Group is encouraged to implement comprehensive employment policies designed to motivate employees and to determine ways in which their knowledge and skills can best contribute towards the success of the business. Schemes are operated to encourage loyalty and performance. For instance, the Tomkins 2005 Sharesave Scheme provides an opportunity to purchase shares in Tomkins plc and is open to eligible employees.
Employee involvement and communication programmes continue to be developed that are designed to provide equal opportunity to all, irrespective of sex, race, religion or colour. Each company in the Group endeavours to provide equality of opportunity in recruiting, training, promoting and developing the careers of disabled persons.
Our Global Footprint: Environment and Climate Change
In 2007 our facilities began reporting energy and water usage, air emissions, waste, and recycling efforts. This data will allow us to better manage these aspects of our operations and allow us to develop meaningful indices. In the table below we have set out absolute figures for waste production, energy and water consumption and greenhouse gas emissions for 2007. Although this data does not cover 100% of our operations, we believe it provides a meaningful guide as to the impact of our operations. The number of facilities reporting data is noted in the table next to each Key Performance Indicator (‘KPI’).
Other actions taken in 2007 to progress our environmental performance include the updating of our HSE policy to reflect our focus on minimising the environmental impact of our operations and the introduction of environmental minimum standards. The revised HSE policy is available for download from our website. Another measure has been to require all of our operating facilities to implement an environmental management system. Good progress was achieved with 111 of our facilities having adopted a system by the end of 2007 and the remainder tasked to do so in 2008.
Tomkins recognises that climate change is a global business challenge. We are committed to reducing our greenhouse gas emissions through efficiency improvements and, in particular, the application of lean manufacturing techniques. We continue to make significant upgrading investments in our facilities in order to bring them towards optimal efficiency levels. Climate change and the environment are also increasingly important drivers of product and process innovation within Tomkins. Across all our business activities, the efficient use of energy is a key focus of our product development programmes, whether to improve fuel efficiency in vehicles or to reduce energy use in residential and commercial heating, ventilation and air-conditioning systems. Many new products with environmentally beneficial features have been developed and launched, further details of which can be found in our full CSR report for 2007.
Our Global Footprint: Community
We recognise our responsibilities to the wider communities in which our businesses operate. These responsibilities range from consulting with local bodies, to providing charitable assistance and supporting community and corporate citizenship projects. Total charitable donations in the year were £424,904 (2006: £560,931) of which the UK accounted for £97,979 (2006: £155,939); in the US, they totalled £241,278 (2006: £323,398), of which £93,247 (2006: £155,916) came from a Tomkins funded charitable trust; and in the remaining overseas companies, they totalled £85,647 (2006: £81,594). It is Tomkins’ practice not to use shareholders’ funds to make political donations either in the form of monetary donations or other in-kind benefits. No political donations were made during the year (2006: £nil).
Our Marketplace
We continue to value highly our relationships with our many, diverse customers. Our products are sold in highly competitive markets and so excellence in customer service, product quality and innovation are always our priority. Likewise, we continue to value relationships with our wide supplier base. We regard our suppliers as a critically important stakeholder group, especially as the quality of our supplier relationships often has a direct bearing on our customer relationships.
We maintain open communication channels with the investment community and have devoted considerable time and resources to our Investor Relations programme. Our 2006 CSR report was well-received and garnered over 2,000 hits on our website. We responded to many queries and requests for further information on our CSR programme from a variety of stakeholders, ranging from third-party survey and assessment organisations, local communities, through to the Carbon Disclosure Project.
Conclusion
Overall, we achieved much progress with our CSR programme this year, and in 2008, we will remain committed to continuous improvement in all our CSR activities as with the rest of our business.
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