As the UK's premier structural steel group, we know that the decisions we make can have a significant effect on the environment and people's lives and communities.

Our commitment to corporate responsibility forms part of the strategy of the Group and is essential to ensure that we deliver value to our stakeholders. We take this responsibility very seriously and are committed to good practice in all our CSR activities. We work beyond compliance to consider how we can have a positive impact on communities, minimise risk in our operations and ensure the best health and safety performance standards.

Statement of ethics

Severfield is the UK's leading structural steel company. We also operate elsewhere in the world and we pride ourselves on our reputation for acting fairly and ethically wherever we do business.

Our reputation is built on our Company values, the values of our employees and our collective commitment to acting with integrity throughout our organisation.

This commitment can be seen in our core values and mission statement which has been communicated via roadshows to all of our personnel.

Everything else comes second to ensuring everyone goes home safely every day."

SAFETY, HEALTH AND ENVIRONMENT

During the year we have continued to progress our strategy of continuous improvement to meet our vision of being recognised as world-class leaders in structural steel, known for our ability to deliver any project to the highest possible standards. Those standards include corporate social responsibility.

We have a set of defined objectives and targets for the factories which include leading indicators such as director reviews, number of leadership team and safety meetings held, number of toolbox talks delivered, safety, health and environment (SHE) training delivered and safety suggestions. Reactive indicators include accident frequency rates, near misses, health and safety audits plus safety violations.

This year we have introduced a health and safety improvement scheme whereby we have incentivised a reduction in our accident rate and an improvement in near miss reporting on-site and in our factories.

During the coming year we will be defining a full set of objectives and targets to meet our vision and conform to our core values.

Our five key focus areas are:

  • Work environment
  • Commitment
  • Leadership
  • Engagement
  • Behaviour

Progress during the year in each of these areas is discussed below.

Work environment

This year we have focused on improving the lighting levels in the factories to make them a better, safer place to work; this work will be ongoing in 2014/15. Not only does this improve the work environment for our personnel and increase lux levels but it also has a positive impact on our energy costs and greenhouse gas emissions.

We have improved the conditions of the yards in all of our factories and have undertaken a comprehensive review of welfare facilities in Lostock and Dalton with these recommendations being implemented in the next year. We are also improving our pedestrian management at Dalton over the coming year.

We have been trialling better personal protective equipment (PPE) with our site-based personnel and will very shortly issue a new standard to enhance the equipment we provide to our workforce.

Severfield UK employee (Bhogi Patel) receiving his monetary voucher after his name was pulled from a draw of hazard cards submitted in the month.

Commitment

The Group continues to maintain a healthy SHE budget together with a professional, well qualified SHE team, headed by the Group SHE director.

Our commitment to 'getting it right' is demonstrated by our Group, factory and site safety leadership team (SLT) meetings which are now held monthly and minuted, and we have representatives from the workforce at these meetings.

We are committed to achieving SHE excellence and moving into the next year, we have set goals on better communication, working towards zero harm and on a coaching ethos to enable the Group to achieve its ambitions in this arena.

We had an AFR for the year of 0.57

We carried out 1,159 man days of SHE training in 2013/14

Leadership

Everyone in our business is a leader as the success of any organisation is based on how well it is able to capture the talents of every individual. Our directors and senior managers also demonstrate their leadership by being seen doing the right thing. This can be through factory and site tours wearing the correct PPE and demonstrating adherence to our safe systems of work; it can be chairing safety and energy reduction meetings; and it can be one-minute corridor conversations with employees and others affected by our business to demonstrate awareness and action.

Engagement

We engage with our stakeholders on a daily basis. Key engagement behaviours are communication, involvement, visibility and support. We are always striving to communicate better. This year we have been actively involving the directors in SHE committees and we use the audit process as a communication tool.

We have commenced safety, health and environmental auditing of our supply chain which provides assurance that our supply chain meet legal requirements and our own standards plus, where applicable, any standards stipulated by our clients. We find these audits are a good method of initiating community involvement since a number of our supply chains are geographically close to our factory locations.

We have placed all of our SHE documentation on the Group's intranet in 2013/14 and are training our workforce to make this the port of call for all SHE systems across the Group. This makes us more efficient, enables assurance that our workforce are using the correct documentation at all times and reduces the amount of paper in our business.

Behaviour

We define behaviour as everything we say and do. This means that any culture change model needs to include an element of understanding of what drives these behaviours and how we elicit positive, safe behaviours in the workplace. We are keen to understand this and during the next year we will embark on the next phase of our behavioural safety programme, starting with training the SHE team in cognitive behaviours.

Health and safety performance

 

In 2013/14 we had 22 RIDDORs compared to 24 in 2012/13. The Group's accident frequency rate (AFR) for the year was 0.57. Whilst this was only marginally worse than the level of 0.55 for the previous period, it fell short of the targets that the board had set for improvement. We believe that our strategy of the five key focus areas above will deliver the performance we desire. In addition to our systems and engineering controls, we believe our behavioural safety programme will deliver a quantum change in our performance over the next year.

Our health and safety management system is fully compliant with OHSAS 18001 and has been externally audited to demonstrate compliance.

We attended a number of client meetings during the year and our SHE director liaises directly with the SHE teams within our client organisations to ensure that we are meeting their expectations as well as our own, together with legal requirements. With respect to our employees and supply chain; they are represented at our SLTs and committees and our visible leadership means that we frequently have workplace-based conversations with our employees and supply chain alike.

It is our intention to involve our supply chain in our behavioural safety strategy since they frequently represent the Group on the sites upon which we work and hence they are as much at risk of an incident as a member of our own workforce.

We reflected upon our Golden Rules in our last annual report: suffice to say these are now embedded in our corporate psychology and these are having an impact on the behaviour of anyone we 'touch' in our working environment (see below).

We are in the process of undertaking a third-party driver audit and following on from this we are introducing mandatory documentation checks and our higher risk drivers will be undertaking additional driver training.

We have undertaken 1,159 man-days of training in the year. This includes more than 40 different courses; examples are: site manager safety training scheme, overhead crane use, portable magnet use, lifejacket use and reversing vehicles.

In terms of health, we have undertaken occupational health assessments of 845 personnel in the year. These personnel undertook tests and checks on their audiometric performance, visual and acuity field, lung function, blood pressure, hand arm vibration syndrome, urinalysis and musculoskeletal disorders. These checks enable us to quickly spot any work-related issues which may have a deleterious effect on our employees and address this to ensure we are not harming our employees in the course of their work.

By way of example on communication of health issues, skin cancer kills seven construction workers a year and we have distributed awareness documentation on this issue across our factories and construction sites:

In addition, we also deliver toolbox talks on men's health and an example is shown below:

PEOPLE

We're very proud of our 1,200-strong workforce and recognise that to be the best, we need the best people and we work with every single employee to develop, grow and nurture their individual talents.

Change

In 2013/14, our people were called upon to embrace change and in particular Severfield (UK) completed its reorganisation, resulting in a strong, talented and aligned team. By continuing to invest in the capabilities and leadership of our people, we continue to enhance the quality of services we deliver to our clients and communities and attract and retain the best people within our sector.

Leadership, management and development

Our success is driven by our people so we want to ensure that we have capable leaders and managers to deliver our strategy and build teams with the right skills and capability to deliver now and in the future.

During 2013/14, we have invested in building our leadership teams and individual leadership capability, ensuring that our leaders understand our strategy, the associated business challenges and their roles in leading and engaging their teams. We undertook the first two stages of a leadership development programme with our directors and associates and will continue this programme in 2014/15.

Talent and succession

In order to protect the long-term success of our business we want to ensure that we understand our talent pipeline and support their development so that our people can be the best that they can be. Our aim is to be an employer of choice for current and future talent within the structural steel industry and the wider business community.

In 2014/15 we will conduct a Group-wide review of emerging talent to ensure consistency and visibility of talent, succession planning and career opportunity. Our agility in deploying talent and experience to maximise opportunities through sharing knowledge across the Group is a key differentiator and one which we will continue to develop.

We are passionate about helping young people take their first step onto the construction career ladder, from school leavers experiencing the world of work for the first time, to graduates qualified in disciplines relevant to the construction sector. We believe that the recruitment and training of apprentices is fundamental to business development; another means of ensuring that we have all the desired skill bases available in the future.

We have 48 apprentices within the Group, having taken on at least ten apprentices each year since our dedicated apprenticeship programme launched in 2010. Among the opportunities available, we have provided placements for welders, platers, maintenance engineers and steel erectors. We are also committed to providing opportunities for graduates across a number of functions, including business support, quantity surveying, design engineering and site and project management.

Diversity

We believe that equal opportunity means hiring and retaining the best people, developing them to their full potential and using their talents and resources to the full. Diversity of people, skills and abilities is a strength which will help us to achieve our best. This is not only about treating our people with dignity and respect; it also makes sound business sense.

At 31 March 2014, the Group workforce consisted of 1,203 employees of whom 80 (seven per cent) were female. The Group's executive committee consisted of ten directors, of whom one was female (ten per cent). The Group board of directors did not have any female representation.

Communications

Maintaining a strong dialogue with our people can be challenging in such a geographically diverse Group, with a mix of factory, office and site-based employees. Our internal communications draw on a wide variety of media, including our workspace document sharing system, Company newsletters, consultative groups, factory committees, suggestion schemes and employee roadshows. In 2014/15, the Group has appointed a communications manager to develop more effective internal and external communication strategies.

High performance culture

We set ourselves stretching goals and we want our people to understand the key part that they play in our strategy and our success. We want them to feel accountable for their delivery and rewarded for their success. In light of this, during 2014/15 we will redefine our performance management tools and processes.

In 2014, we also plan to focus on employee engagement as there are proven links between an engaged workforce and excellence in customer service and business delivery. We are in the process of defining our approach to an employee survey that will enable us to prioritise actions that mean the most to our people. Subsequently, we plan to implement a number of initiatives across our business to help strengthen employee connection to our goals and ambitions.

Reward

We recognise that our approach to reward is critical to our ability to both attract and retain the best people and drive a performance culture. Each of our divisions offers a competitive reward package appropriate to the labour market in which they operate and reviews salaries annually in line with market rates. Our focus is on cash and variable pay rather than fixed benefits and each division's reward package includes an annual Group profit performance related bonus which encourages the achievement of our strategic objectives.

Over 65 per cent of our employees are shareholders in the Company via our share incentive plan and in 2014/15, we intend to set up a save as you earn share scheme to provide our employees with an improved choice in the way that they participate.

Our people are also eligible to participate in a Group defined contribution pension scheme towards which we contribute as well as having the option to make their own contributions through salary sacrifice. We have also been able to facilitate a number of flexible benefits that enable our people to access programmes and savings that would not be available to them on an individual basis without additional cost to the Group. These include cycle to work and childcare voucher schemes. During 2014/15, we will look to widen the range of flexible benefits that we offer to our people.

COMMUNITIES

We recognise the importance of our local communities in building strong links and relationships that will enable us to attract and employ local people and improve the world in which we all live and work.

In terms of engagement with the wider community in which we work, we typically work for a main contractor who consults the local community affected by each project we work on. Main contractor initiatives include maximising opportunities to employ local people from disadvantaged groups, for example the long-term unemployed. The Group seeks to share in these opportunities and further develop the support it can offer to disadvantaged groups.

Our companies take a leadership role within the industry by providing employees, customers, suppliers and potential employees with opportunities for seminars, field trips and site visits.

Staff throughout the Group maintain close contact with local schools, colleges and universities to share best practice and provide examples of leading-edge structural engineering. For example, our Severfield (Design & Build) business sponsored and presented at the Scarborough Engineering week where over 2,000 students attended to get an understanding of career opportunities within the engineering sector.

In 2013/14, the Group's factory committees have considered how best each facility can support local communities and charitable organisations. During the year, our people have donated their time to raise funds for a wide variety of charities which the Group has supported, including the Yorkshire Air Ambulance and local hospices. In 2014/15, the Group will set up the Severfield foundation to champion charitable work and organise donations.

Despite the difficult economic conditions that have existed for everyone over recent years, we are enormously proud of the way our employees have continued to engage with their local communities and with our charitable activities.

ENVIRONMENTAL PERFORMANCE

The Group maintains its environmental management system which is certified to ISO 14001 and has been since 2007.

Information on our environmental impact is collated monthly and is reported to the board. This includes impacts such as waste, factory energy, VOC emissions and fuels. With respect to waste, 98 per cent is recovered or recycled.

All our works and project sites operate in accordance with our sustainability policies. We track our sustainability performance on a project by project basis and, where required, report information to our clients.

Greenhouse gas emissions reporting

In accordance with the Companies Act 2006 (Strategic Report and Directors' Reports) Regulations 2013, we report our emissions as described below.

Reporting boundaries

To the best of our knowledge, we have included all material emission sources which fall within the boundaries of our consolidated accounts.

All direct (scope 1) and indirect (scope 2) emissions are reported in absolute tonnes equivalent CO2 (CO2e). Greenhouse gases ('GHG') included are carbon dioxide, methane and nitrous oxide emissions from the combustion of fuels disclosed below, and carbon dioxide emissions from the consumption of purchased electricity.

  • Scope 1 GHG emissions are from: natural gas, gas oil, propane, kerosene, welding gases, diesel and petrol.
  • Scope 2 GHG emissions are from: electricity purchased and consumed.

Methodology

The Group's GHG emissions have been calculated using an operational control approach in accordance with WRI/WBCSD GHG reporting protocols (revised edition) and emission factors from UK Government GHG conversion factors for company reporting 2013. This is the first year that our GHG emissions have been reported.

Results

For the year ended 31 March 2014, the Group's global GHG emissions were as follows:

Emissions from:Tonnes of C02e
Scope 1 – combustion of fuel and operation of facilities6,340
Scope 2 – electricity, heat, steam and cooling purchased for own use6,179
Total12,519
Intensity measurement:Tonnes of C02e
Absolute tonnes equivalent CO2 per £m of revenue54

We also met our monthly average VOC concentration limit targets for every factory during the year ended 31 March 2014.