REFLECTING ON OUR JOURNEY SO FAR - Interserve · Employee Foundation and volunteering programmes...

Progress Update 2016

REFLECTING ON OUR JOURNEY SO FAR

3

CONTENTS INTRODUCTION 4

FOREWORD FROM TIM HAYWOOD 4

OUR STORY SO FAR 6

INTRODUCING SUSTAINABILITIES 2.0 8

PLACES THAT BENEFIT PEOPLE 9

GOAL 1: GO ABOVE AND BEYOND IN COMMUNITIES WHERE WE WORK 10

GOAL 2: EMBRACE AND PROMOTE WELLBEING 12

LOOKING FORWARD 14

PUBLIC SERVICE IN THE PUBLIC INTEREST 15

GOAL 3: UPHOLD THE HIGHEST ETHICAL STANDARDS 16

GOAL 4: ACT WITH TRANSPARENCY 18

LOOKING FORWARD 20

MORE SKILLS, MORE OPPORTUNITIES 21

GOAL 5: OFFER ‘SUSTAINABILITY AS STANDARD’ 22

GOAL 6: INSPIRE FUTURE PROFESSIONALS 24

GOAL 7: CREATE A CULTURE OF INNOVATION 26

LOOKING FORWARD 28

POSITIVE ENVIRONMENTAL IMPACT 29

GOAL 8: PROTECT THE NATURAL ENVIRONMENT 30

GOAL 9: CONSERVE AND REPLENISH WATER 32

GOAL 10: HALVE CARBON EMISSIONS 34

GOAL 11: MAKE WASTE A THING OF THE PAST 36

LOOKING FORWARD 38

SUSTAINABLE GROWTH 39

GOAL 12: BUY SUSTAINABLE PRODUCTS AND SERVICES 40

GOAL 13: IMPROVE CLIENTS’ ENERGY SECURITY 42

GOAL 14: ADAPT AND RESPOND TO ENVIRONMENTAL CHANGE 44

GOAL 15: VALUE MORE THAN JUST MONEY 46

LOOKING FORWARD 48

SUMMARYOUR PERFORMANCE 49

GET INVOLVED 51

THIS REPORT IS STRUCTURED AROUND OUR FIVE OUTCOMES. THE FOLLOWING PAGES PROVIDE AN UPDATE ON THE PROGRESS WE’VE MADE TOWARDS ACHIEVING THE GOALS AND TARGETS THAT SIT BENEATH THESE OUTCOMES, WHAT WE’VE LEARNT ALONG THE WAY AND OUR NEXT STEPS.

WHO WE ARE

OFFERING SERVICES TO CUSTOMERS AROUND THE WORLD, INCLUDING:

FACILITIES MANAGEMENT PROBATION & REHABILITATION SERVICES APPRENTICESHIPS, TRAINING AND EMPLOYMENT SUPPORTESTATE MANAGEMENT OIL AND GAS SERVICES CONSTRUCTION FIT-OUT ENGINEERING SERVICES CONSULTING FORMWORK & FALSEWORK – DESIGN & ENGINEERING GROUND SHORING

FIND OUT MORE ABOUT WHAT WE DO: interserve.com

£3,244.6M REVENUE

80,000 PEOPLE

INTERSERVE IS A LEADER IN INNOVATIVE AND SUSTAINABLE OUTCOMES FOR OUR CUSTOMERS. WE OFFER CONSTRUCTION, EQUIPMENT SERVICES, FACILITIES MANAGEMENT AND FRONTLINE PUBLIC SERVICES. HEADQUARTED IN THE UK AND FTSE LISTED WE DELIVER SERVICES ACROSS A RANGE OF SECTORS INCLUDING EDUCATION, CENTRAL GOVERNMENT, JUSTICE, HEALTH, INFRASTRUCTURE AND INDUSTRY.

SUSTAINABILITY IS AT THE HEART OF OUR VISION TO ‘REDEFINE THE FUTURE FOR PEOPLE AND PLACES’

WE BUILD GREAT RELATIONSHIPS WITH COLLEAGUES, CUSTOMERS AND COMMUNITIES TO MAKE A POSITIVE IMPACT ON PEOPLES’ LIVES. WE ARE AGENTS OF CHANGE IMPROVING THE WAY THINGS ARE DONE.

http://interserve.com

4 5Interserve SustainAbilities Progress Update 2016

Welcome to our annual SustainAbilities Progress Update. This covers a difficult period for the commercial and financial performance of the group. But it has also been a period in which we have continued to show our commitment to our vision and have repeatedly demonstrated that Interserve is an organisation that creates wider value for society. This report is full of ambition and success; there are many great stories and some outstanding achievements against our stretching targets.

We continue to embed sustainability in our mainstream operations and ensure our decision making takes a broad range of factors into consideration – wherever we operate in the world. We can see the strong business case for sustainability, including:

Winning work with customers who appreciate our commitment to the environment, to local communities, or to learning and skills

Reducing our costs by reducing our resource consumption, waste and our carbon emissions

Improving our employer brand through investments in skills, in learning, and by giving our people the opportunity to make a difference in their local communities through our thriving Employee Foundation and volunteering programmes

Raising our public profile as a force for good and for social change through our involvement in tackling some of the key challenges facing society, such as improving skills and employability, rehabilitation of offenders and promoting diversity and inclusion

Our progress, and the many case studies and statistics in this report, make us very proud to work for Interserve as we strive every day to Bring Better to Life.

Looking to the future Our SustainAbilities Plan, conceived more than 5 years ago, has stood the test of time and has served us well. We have achieved many of the targets (including some of the Big Hairy AudaciousGoals!) and have driven its principles deep within our group.But we also recognise that the group has evolved and grown inthis time, and that we needed to refresh the plan to set out thechallenges beyond 2020.

Therefore, we have undertaken a thorough review with many hundreds of our colleagues, to compile the next version, which we are launching with this Progress Update. This is an evolution, not a revolution – further developing the tools and skills we have built over the last 5 years and applying the lessons we have learned.

But our new plan is somewhat different: It is more reflective of our current business activities,

recognising the growing importance of the frontline services we deliver

It is simpler, with fewer, more focused, targets It is more orientated towards the needs of our customers,

our colleagues and the communities we serve It is therefore even more personal to Interserve than the

original plan

It also marks the further integration of our core business activities with the outcomes and goals we seek to achieve through our plan.

Sustainable business is good businessOur activities all help redefine the future for people and places – whether that’s through providing infrastructure, supporting people into employment or making environments safe and secure. Everything we do aims to be consistent with this overarching purpose. The targets we set through our SustainAbilities plan are increasingly aligned to the services we offer to our customers and the value they bring for society, as well as efforts that help improve our operations.

There is an important role for business in helping address societal challenges and we are committed to playing a practical role in providing solutions to these.

This year I will be handing over the reins of the SustainAbilities Plan when I leave the Interserve business. It’s been incredibly rewarding to see the results of all of our efforts over the years and we are very proud of what has been achieved. I hope you are as excited as I am about our new plan and its role in helping ensure Interserve continues to be a leading example of sustainable business.

Tim HaywoodGroup Finance Director and Head of Sustainability

FOREWORD

600+ GRADUATES, TRAINEES AND APPRENTICESON PROGRAMME

100,000TRAINING

DAYS AROUND THE WORLD

14%REDUCTIONIN WATER INTENSITY

18% REDUCTION IN CARBON INTENSITY

25% REDUCTION IN CONSTRUCTION WASTE

TARGET ACHIEVED

52% SUPPLIERS COVERED BY SUSTAINABILITY CODE OF CONDUCT

LAUNCHED SOCIAL MAPPING TOOL

VOLUNTEERING DAYS

£2.5 MILLION INVESTED IN LOCAL COMMUNITIES

ACHIEVED THE NATIONALEQUALITYSTANDARD

WORK-RELATED

OPPORTUNITIES FOR PEOPLE FACING BARRIERS TO WORK

76 Interserve SustainAbilities Progress Update 2016

OUR STORY SO FAR...

SUSTAINABILITIES IS AN IMPORTANT PART OF HOW WE DO BUSINESS. THIS YEAR WE’RE SHARING THE PROGRESS WE’VE MADE AND WHERE WE’RE HEADING NEXT.

WE HOPE YOU’LL WANT BE A PART OF IT.

IN 2013 WE SET OURSELVES SOME CHALLENGING TARGETS AROUND SUSTAINABILITY.

IN 2017 WE’VE REVIEWED AND REFINED THIS, TO BE MORE FOCUSED ON WHAT MATTERS TO US.

OUR CUSTOMERS, OUR COLLEAGUES, OUR COMMUNITIES.

IN 2013 WE INTRODUCED OUR SUSTAINABILITIES PLAN.

IT HAD 5 OUTCOMES, 15 GOALS, AND 48 TARGETS. IT PUT SUSTAINABILITY AT THE FOREFRONT OF OUR DECISION MAKING.

WE’RE HALF-WAY THROUGH THAT PLAN. AND WE’RE MAKING GOOD PROGRESS.

BUT OUR BUSINESS HAS CHANGED – WITH MORE PEOPLE AND SERVICES THAN EVER BEFORE. THE WORLD HAS MOVED ON.

SO THIS YEAR, WE’VE TAKEN A MOMENT TO STOP AND THINK.

IS IT STILL FIT FOR PURPOSE?DOES IT ALIGN TO A CHANGING WORLD? DOES IT STILL SUPPORT OUR BUSINESS GOALS?

AND WE REALISED IT’S TIME TO CHANGE. SO WE’VE TAKEN A LONG HARD LOOK AT THE PLAN, AND MADE SOME CHANGES.

WE’VE SIMPLIFIED IT.WE’VE SET OURSELVES SOME NEW AND CHALLENGING TARGETS.AND WE’RE CHANGING HOW WE ENGAGE OUR PEOPLE TO HELP DELIVER IT.

WE WANTED A GREATER FOCUS ON OUR SOCIAL IMPACT. WITH PEOPLE AT THE HEART OF OUR PLAN.


PLACES THAT BENEFIT PEOPLE

WHAT DOES THIS MEAN?Whatever the place, we put people at its heart. We create environments where people want to be, and can feel their best. We support communities, job creation and local supply chains. We improve quality of life for people and the communities where we live and work.

OUR INTERSERVE EMPLOYEE FOUNDATION NOW HAS OVER 200 AMBASSADORS WORLDWIDE

OUTCOME 1

VOLUNTEERING DAYS

12% REDUCTION IN ACCIDENT INCIDENT RATE

20% OF OUR MEALS DEFINED AS HEALTHIER OPTIONS


INTRODUCING SUSTAINABILITIES 2.0Our updated SustainAbilities Plan touches our people, customers and the communities where we operate, helping us to achieve our vision to redefine the future for people and places. It sets our actions that shape our operations and are embedded deep into our business.


IMPROVE QUALITYOF LIFE FOR ALL

500 LONG-TERM COMMUNITY RELATIONSHIPS, 20%

EMPLOYEE VOLUNTEERING

OUR GOALS

OUR ACTIONS BY OUR ACTIONS BY

OUR OUTCOMES

DELIVER £1BN OF SOCIALVALUE THROUGH OUR WORK

EVIDENCE LEADING PRACTICE AGAINST A CORPORATE

HUMAN RIGHTS STANDARD

ACHIEVE A FUTURE PROOF WORKFORCE FIT FOR 2030

REDUCE OUR CARBONEMISSIONS BY 60%

ALL KEY SUPPLIERSACTIVELY PARTICIPATE IN

OUR 'FORWARD THINKING' PROGRAMME

ACHIEVE A SCORE OF 80%ON OUR WELLBEING INDEX

CHAMPION DIVERSITY AND INCLUSION THROUGH THE

NATIONAL EQUALITY STANDARD (UK), AND UN GLOBAL COMPACT

WORK TOGETHER ON 250PROJECTS THAT DELIVER SUSTAINABLE OUTCOMES

IMPROVE THE LIVES OF 25,000 DISADVANTAGED PEOPLE

90% OF OPERATIONSWITH ROBUST

ENVIRONMENTAL PLANS

SUPPORT 15,000 APPRENTICES, CREATE 1,000 APPRENTICESHIPS

REDUCE USE OF RESOURCESAND WASTE BY 40%

95% RESPONSIBLY SOURCED,80% KEY PRODUCTS TRACEABLE

TO SOURCE

BUILD INDUSTRY LEADING TOOLSTO MEASURE SOCIAL VALUE

UPHOLD THE HIGHEST ETHICAL STANDARDS

ENABLE SOCIALINCLUSION

PROTECT AND IMPROVE THE NATURAL ENVIRONMENT

BUY SUSTAINABLE PRODUCTS AND SERVICES

PROMOTE WORKPLACE HEALTH AND WELLBEING

DELIVER OUTSTANDING SERVICE

DEVELOP ANDINSPIRE PEOPLE

IMPROVE RESOURCE EFFICIENCY

VALUE MORE THANJUST MONEY

SERVICES IN THE PUBLIC INTEREST

MORE SKILLS, MORE OPPORTUNITIES

POSITIVE ENVIRONMENTAL

IMPACT

SUSTAINABLE GROWTH

10 11Interserve SustainAbilities Progress Update 201610 11

GO ABOVE AND BEYOND IN COMMUNITIES WHERE WE WORK

The Interserve Employee Foundation (IEF) provided a grant to reconstruct Shree Chandeswori School in Nepal following the devastating 2015 earthquake. The new building accommodates over 500 young people, providing education in a region where 10% of employees in our Middle East operations are from.

We launched our innovative Social Mapping Tool which enables us to better understand the communities we serve. The interactive tool combines publicly available UK data on employment, age, ethnicity, health and crime statistics, with Interserve’s data on employment and supply chains to help inform our decision making. As one of the UK’s biggest employers, the tool helps us to identify how and where we can best contribute to tackling some of today’s biggest social issues in a way that creates better value for all!

OUR CHALLENGES Changing mindsets to consider how we can deliver services

and generate social value Balancing operational drivers with social benefits - our

aims to consolidate our supply chain and use SMEs can be difficult to reconcile

Building a picture of the different relationships we have with different communities across our business

MAJOR ACHIEVEMENTS LAUNCHED ARC YORKSHIRE TO OFFER SOCIAL ENTERPRISES

FREE BUSINESS MENTORING LAUNCHED ‘CAPACITY’ THE PUBLIC SERVICES LAB, TO SUPPORT THE VOLUNTARY, COMMUNITY

AND SOCIAL ENTERPRISE SECTOR TO COMPETE SUCCESSFULLY FOR PUBLIC SECTOR CONTRACTS RECOGNISED BY ARABIA CSR NETWORK FOR SUSTAINABILITY ACHIEVEMENTS INCLUDING

OUR SUSTAINABILITIES PLAN AND EMPLOYEE VOLUNTEERING SIGNED UP TO THE ‘BUY SOCIAL’ CORPORATE CHALLENGE PLEDGING TO BUY SERVICES FROM

SOCIAL ENTERPRISES IN OUR SUPPLY CHAIN

WHAT HAVE WE DONE?Building social valueOur business has a significant opportunity to promote and generate social value. This includes employing local people and sub-contractors, using local businesses, small and medium-sized enterprises (SMEs) and social enterprises (SEs) in our supply chain and working in partnership with community groups. These activities help to stimulate local economies, and build relationships based on trust and goodwill in the communities where we live and work.

In 2016 we developed a practical Guide to Social Value to help increase awareness and understanding of how our people can create social value through all stages of contract delivery.

Watch our animation on social value: goo.gl/UOJ3Eq

Working with communities Our community investments help us establish long-term relationships to drive positive change – providing new facilities, training to develop new skills and supporting disadvantaged groups around the world. This year, we’ve made a step change in employee volunteering with double the number of people using their 2 days of paid volunteering time compared to 2015.

We’ve also developed new projects in partnership with community groups, to tackle challenges such as homelessness and substance misuse. Our combined community investments through direct donations, employee time and funds raised reached £2.5million, putting us on track to fulfil our 2020 target to invest 3% of our pre-tax profit in communities.

Adding value through the supply chain We’ve continued to support businesses of all sizes - SMEs make up 65% of our supply chain spend worth £856m, whilst our spend with social enterprises increased to £7.6m. We’ve also continued to support local supply chains with 54% of construction contracts awarded to companies based within 50 miles of each site.

Additionally, we joined with 8 other leading businesses in Downing Street to launch the ‘Buy Social’ Corporate Challenge and together aim to spend £1 billion with social enterprises by 2020. Led by Social Enterprise UK in partnership with the Department for Culture, Media and Sport and Business in the Community (BITC), the challenge will ensure we maximise the social benefits our spend has. We also continued our partnership with BITC on arc Yorkshire with 10 volunteers mentoring 6 Social Enterprises, leading to the creation of 20 new jobs in the region.

VOLUNTEERING DAYS

SPEND WITH SMALL MEDIUM ENTERPRISES

£7.6 MILLION SPEND WITH SOCIAL ENTERPRISES

OUR INTERSERVE EMPLOYEE FOUNDATION HAS

200+ AMBASSADORS WORLDWIDE

OUR SHOWCASE

Our RMD Kwikform team stepped in to volunteer 24 days of time, money and equipment to ensure Hong Kong’s Big Picnic went ahead, enabling hundreds of bands, performers and craftspeople to raise funds for charity.

A HELPING HAND FOR A BIG PICNIC

MAKING DECISIONS BASED ON LOCAL COMMUNITY NEEDS

Our 2016 IEF Ambassador of the Year Emma Phillips organised over 60 volunteers funded by the IEF to refurbish Grimm & Co’s ‘Apothecary to the Magical’ in Rotherham. Volunteers helped to create a magical space for innovative storytelling and creative writing workshops to help inspire children’s imaginations, build confidence and communications skills.

A MAGICAL IMPACT ON YOUNG PEOPLE

Building two new schools in Monmouthshire, an area of high unemployment, gave us the opportunity to support local businesses and provide new jobs. 63% of the workforce come from Wales and 39% of project spend contributed to the local economy with 52% of Welsh materials used. We also used 100% British steel from local plants.

SUPPORTING LOCAL JOBS IN WALES

REBUILDING A SCHOOL FOR THE NEXT GENERATION

WE WON CSR INITIATIVE OF THE YEAR AT THE fmME AWARDS FOR OUR WORK IN NEPAL

WE ARE WORKING WITH REACH OUT TO ASIA (ROTA) TO SUPPORT LOCAL FAMILIES IN NEED BY RENOVATING HOMES

We are passionate about creating social value and making a positive contribution to the communities where we operate. This means sharing our expertise, providing jobs, supporting the local economy and our supply chain partners – helping communities grow and thrive.

Empowering our people with tools and knowledge to understand local context and make relevant decisions

WHAT’S NEXT?

Implementing new targets that encourage long-lasting community relationships and encourage greater employee volunteering

Building on our ‘Buy Social’ Challenge ambitions

12% EMPLOYEE VOLUNTEERING

GOAL 1

65%

Watch a short clip bringing the map to life: goo.gl/v2vaJO


http://goo.gl/UOJ3Eq

http://goo.gl/v2vaJO


EMBRACE AND PROMOTE WELLBEING

MAJOR ACHIEVEMENTS LAUNCHED TWO NEW CATERING OFFERINGS; ALLERGENIC MEAL CHOICES AND TRULY GOOD,

MEALS WITH FEWER THAN 500 CALORIES PILOTED A STANDARD FOR HEALTH AND WELLBEING AND ROLLED THIS OUT ACROSS OUR

INTERNATIONAL OPERATIONS RECOGNISED BY THE ROYAL SOCIETY FOR THE PREVENTION OF ACCIDENTS WITH 23 AWARDS.

TWO EMPLOYEES RECEIVED GUARDIAN ANGEL AWARDS INGENUITY HOUSE, OUR NEW MIDLANDS OFFICE HUB, WAS ONE OF 10 SITES IN THE COUNTRY

SELECTED TO PILOT CONSIDERATE CONSTRUCTOR’S ULTRA-SITE SCHEME

WHAT HAVE WE DONE?Promoting employee wellbeingWellbeing is influenced by a range of factors both at work and home. Our Health and Wellbeing programme covers physical, psychological, social and cultural wellbeing, helping us respond to the changing needs of the workforce and create productive working environments, to support employee engagement and job satisfaction. Enabling healthy lifestyles is particularly important in our international operations where we provide accommodation, catering and leisure facilities for our workforce.

We’ve introduced stress management training and retirement transition workshops, provided wellbeing kiosks in our main offices, increased our Employee Assistance Programme (EAP) provision, as well as continuing our health assessment and surveillance programme. In our International businesses we have also developed a wellbeing standard, implemented suggestions from our welfare committees, and expanded our focus on health and wellbeing to our supply chain.

During 2016, we conducted a review of our programme to identify what’s worked and where there’s room for improvement. Next year, we’ll be developing a new Wellbeing Index to understand wellbeing better and to target improvement.

Managing safetyWe adopt a proactive approach to the management of safety, focusing on behaviour change and management culture as well as formal management systems and policies. During 2016 90% of site managers and supervisors received training on health & safety and our leadership teams completed 4900 safety tours. This focus on safety helped us achieve a 10% reduction in lost time incidents and 12% reduction in our overall reportable accident incident rate.

However, despite the progress we’ve made, during 2016 two of our people in Oman and a contractor working for us in Qatar suffered fatal injuries in two separate incidents. We have conducted thorough investigations of these incidents to identify lessons learned and inform a detailed review of our health and safety culture. We are more dedicated than ever in 2017 to ensuring that safety is treated with the utmost importance by everyone.

MANAGEMENT SAFETY TOURS

53%OF CONSTRUCTION PROJECTS SCORED 40+ ON THE CONSIDERATE CONSTRUCTOR SCHEME

12% REDUCTION IN THE ACCIDENT INCIDENT RATE

COMPARED TO 2015

20%

OUR GROUP-WIDE EMPLOYEE ENGAGEMENT SCORE INCREASED +7% TO 75%

In 2016 Interserve received a total of 21 awards from Considerate Constructors, and won ‘Most Considerate Site’ in our category for Noah’s Ark Children’s Hospital in Wales. Our site was recognised for high levels of communication and engagement with our neighbours at the hospital, sensitivity to vulnerable patients and our activities to keep staff and visitors up to date on progress, as well as measures in place to promote physical and mental health awareness.

GOING ABOVE AND BEYOND AS CONSIDERATE CONSTRUCTORS

Across our middle east operations we developed a standard for health and wellbeing that includes health surveillance and screening for our people, alongside health education and life skills sessions. These interventions have led to a measurable improvement in employees assessed as having a reasonable bill of health from 79% to 90%, and a reduction in people suffering critical health conditions in our Khasaheb business.

IMPROVING EMPLOYEE HEALTH AND WELLBEING

We’ve looked at the age profile of our workforce to understand how we can best support our people. With the average age of an Interserve employee being 45 years, and with 40% of our workforce aged 50+, we are investing in up-skilling, job redesign, and succession planning. We’ve used this to inform our recruitment to ensure we have the skills within the business to replace those set to retire. We offer our people pre-retirement planning workshops covering financial planning, how to stay fit and healthy, and adjust to the future to help them transition to a new life.

SUPPORTING HEALTH AND WELLBEING OF OUR OLDER WORKFORCE

Together with workplace change experts Advanced Workplace Associates (AWA) we undertook a pioneering research project, ‘Workplace Experiences’, to understand the science behind designing effective workplaces. Today, science and design are commonly combined to create emotional responses such as delight at amusement parks, or desire to buy at retail outlets. We wanted to apply these principles to the office to create environments that inspire knowledge and creativity leading to better organisational performance.

UNDERSTANDING HOW WORKPLACEEXPERIENCE IMPACTS PRODUCTIVITY

WE’VE INTRODUCED PRE-QUALIFICATION ASSESSMENTS FOR OUR SUPPLY CHAIN EMPLOYEE VILLAGES TO ENSURE THAT ALL PEOPLE WORKING ON OUR SITES RECEIVE A GOOD STANDARD OF CARE.

A healthy, happy and safe workforce is very important to us. When our people feel valued they are more productive, able to embrace change and optimistic. Our aim is to champion the wellbeing of our people and the communities we touch.

GOAL 2

OUR CHALLENGES Making sure we have the right support in place for an

ageing workforce, as well as attracting the next generation into the sector

Establishing accurate, complete and consistent measures of health and wellbeing to develop clear business cases for investment

Wellbeing competes with many other management priorities meaning it doesn’t always get the focus it deserves

OUR SHOWCASE

Creating a Wellbeing Index to improve our understanding of employee wellbeing, assess progress and target future actions

Better communicate availability of wellbeing support for our people and support mental health through our Healthy Minds Network

Expand our health surveillance standard across all of our people in our Middle East operations

Focus on behaviour interventions that raise our people’s awareness of safety and safe behaviours

75%

97% OF OUR EMPLOYEES WORK UNDER SAFETY MANAGEMENT SYSTEMS TO OHSAS 18001

9%INCREASE ON 2015

OF OUR MEALS DEFINED AS HEALTHIER OPTIONS

55%

Find out more in our research series: goo.gl/c4Y0QC

WE WERE ALSO AWARDED EXCEPTIONAL SCORES FOR OUR WORK ON THE CHRISTIE PROTON BEAM THERAPY CENTRE AND SUPPORTING THE CHRISTIE CHARITY BY RAISING OVER £10,000 TO DATE.

WHAT’S NEXT?

http://goo.gl/c4Y0QC


LOOKING FORWARD

We’ve made good progress in this area, but we want to do more. That’s why we’re focusing on longer term relationships with communities where we live and work – investing in partnerships, growing them and recognising the value they bring. We’re also continuing to focus on employee volunteering and enabling our people to support the local charities and community groups that matter to them.

Through our work we provide employment and support local businesses, we aim to do this in a way that generates value for society. By supporting young people, disadvantaged groups, small and medium sized businesses and social enterprise. Our new target to generate £1 billion social value by 2025 will help drive our decision making.

Our people are our most valuable asset, we want them to return home safe and well. We’ve renewed our focus on wellbeing, wherever we operate – in the UK and overseas, with a new action to develop a Wellbeing Index and improve our performance against it.

We are still on track to achieve our previous target to invest 3% of pre-tax profit in communities. This target will continue to be a guiding principle of our SustainAbilities Plan. However, it will no longer form an explicit target within our plan.

Our target to keep voluntary employee turnover below 10% will no longer be an element of our SustainAbilities Plan, although we will continue to publish these metrics. Parameters on employee turnover are set internally based on business sector and best practice benchmarks.

Our target to include wellbeing KPIs in contracts above £25m is no longer considered a useful indicator of our success. We are continuing our commitment to enhancing workplace wellbeing and will explore alternative ways to drive progress on this issue.

Our previous target to enable projects to be jointly owned, managed or operated with community groups has been a huge success with many partnerships and alternative funding models now in place, led by our investment in PurpleFutures and Capacity – the Public Service Lab. This target will continue to inform how we operate and is complemented with our more refined 2020 action to support long-term community relationships.

PUBLIC SERVICE IN THE PUBLIC INTEREST

WHAT DOES THIS MEAN?Providing services that are the best they can be. We deliver a wide range of services, from catering to healthcare, from probation to design and construction. We act as agents of change, making a difference to peoples’ lives and acting in an ethical and responsible way.

OUTCOME 2

AWARDS FOR

LIVING THE COMPANY VALUES

OPPORTUNITIES CREATED FOR PEOPLE FACING BARRIERS TO WORK THROUGH OUR OPERATIONS

3,500 LONG-TERM UNEMPLOYED HELPED INTO WORK IN 2016

ACHIEVED THE NATIONALEQUALITYSTANDARD

52% OF SUPPLIERS COVERED BY OUR SUSTAINABILITY CODE OF CONDUCT, 8500+ SUPPLIERS

WORK-RELATED


IMPROVE QUALITYOF LIFE FOR ALL

500 LONG-TERM COMMUNITY RELATIONSHIPS, 20%

EMPLOYEE VOLUNTEERING

OUR GOALS

DELIVER £1BN OF SOCIALVALUE THROUGH OUR WORK

ACHIEVE A SCORE OF 80%ON OUR WELLBEING INDEX

PROMOTE WORKPLACE HEALTH AND WELLBEING

CREATING PLACES WHERE PEOPLE WANT TO BE. WHERE THEY FEEL THEIR BEST. AND THAT LEAVE A LASTING LEGACY.

WHATEVER THE PLACE, WE PUT PEOPLE AT ITS HEART. OUR REFRESHED GOALS AND NEW ACTIONS FOCUS ON IMPROVING QUALITY OF LIFE AND GENERATING SOCIAL VALUE.

WHAT HAPPENS TO OUR PREVIOUS TARGETS?



WHAT’S NEXT?


MAJOR ACHIEVEMENTS RECOGNISED AS ‘UK CONSTRUCTION COMPANY OF THE YEAR’ IN THE NATIONAL CENTRE FOR

DIVERSITY AWARDS PROVIDED EQUALITY, DIVERSITY AND INCLUSION TRAINING TO RECRUITING MANAGERS,

DELIVERED UNCONSCIOUS BIAS TRAINING TO 1000+ EMPLOYEES OUR INTERSERVE LEARNING & EMPLOYMENT BUSINESS ACHIEVED THE MERLIN STANDARD

WHICH RECOGNISES EXCELLENCE WITHIN SUPPLY CHAINS ACHIEVED THE NATIONAL EQUALITY STANDARD FOR OUR UK BUSINESS IN 2016

WHAT HAVE WE DONE?Respecting human rights and managing ethical risksWe’re working to ensure human rights are respected across all our operations. We’ve continued to improve recruitment and employment practices, worker welfare procedures and accommodation standards, and implemented pre-qualification questionnaires and codes of conduct for prospective suppliers across our key markets to ensure a good standard of work and living for all our people. We have also actively engaged with our supply chain, starting pre-qualification inspection and assessment of sub-contractor accommodation in the Middle East. Consequently, we stopped working with two sub-contractors who failed to comply with our Improvement Notices for their employees’ welfare facilities. More can be found on pages 18 and 40.

Championing diversity and inclusionOur continuing efforts to promote diversity and inclusion are evidenced by our award of the National Equality Standard in 2016. We’re proud to be the first company in the Support Services and Construction sectors to have been accredited, and the largest employer to achieve the standard to date.

Our employees’ perspectives on diversity and inclusion gathered during focus groups were presented at our Leadership conference. As a result, board members are championing employee support networks such as the ‘Women in Interserve Network’ and newly formed LGBT and BAME Networks.

Our SustainAbilities plan review enabled us to reflect on our target to increase diversity on our boards. Gender diversity of our main operating board has increased, however we are now focusing on how to maintain diversity in our future leadership pipeline. Our long-term action plan supports investment in future leaders, helping them step into senior roles through improved succession planning, recruitment practices and leadership programmes, as well as offering coaching and mentoring sessions for aspiring leaders.

Breaking down barriers to employment We’ve almost quadrupled work-related opportunities taken up by disadvantaged people facing barriers to work, and are working with over 80 organisations worldwide to support ex-offenders, ex-service personnel, young people not in education, employment or training (NEETs) as well as people with disabilities through employment. In addition, our specialist skills and training business, Interserve Learning and Employment (ILE), is one of the largest providers to both the UK Department for Education and Department for Work and Pensions. Contracts include providing advice and guidance for NEETs, skills support for the unemployed and individuals facing redundancy. ILE also provides apprenticeships and traineeships to Interserve’s new and existing employees.

We’ve also continued to champion Business in the Community’s Ban the Box campaign to remove the criminal conviction tickbox from early recruitment applications, actively promoting it with our supply chain. It’s crucial to us to value the uniqueness of people and how they contribute, creating better, and more cohesive teams.

Find out why we’re supporting ex-offenders: goo.gl/wxdzB7

Our goal to uphold the highest ethical standards is about ensuring a common set of behaviours and values in our own operations and in our supply chain. To enable everyone who works with us to feel safe, valued, trusted and included.

OF SUPPLIERS COVERED BY OUR SUSTAINABILITY CODE OF CONDUCT, 8500+ SUPPLIERS

GOAL 3

WORK-RELATEDOPPORTUNITIES CREATED FOR PEOPLE FACING BARRIERS TO WORK THROUGH OUR OPERATIONS

AWARDS FOR LIVING THE COMPANY VALUES

HELD 25 DIVERSITY AND INCLUSION FOCUS GROUPS

OUR SHOWCASE

The Construction industry has historically failed to attract a diverse workforce, and we want to overcome this. In 2016 we trained 15 Women in Science and Engineering (WISE) ambassadors, co-authored a Women in Engineering best practice guide, and delivered many projects supporting diverse and disadvantaged groups through our diversity champion network. We’ve also supported PhD research at Loughborough University on the link between treatment at work and perceptions of equality and inclusion.

OUR CHALLENGES Understanding of workforce diversity at different

organisational levels – needed to assess the impact of actions and identify areas for support

Reliance on suppliers to fulfil ethical commitments covered by codes of conduct, with limited capacity to audit them

Tracking all the activities supporting disadvantaged groups across our business to share learnings and inspire others

Servicemen and women can find the transition from the military to civilian life challenging. Finding the right type of work can help re-adjustment. Interserve is building the new Defence National Rehabilitation Centre (DNRC) near Loughborough, a clinical facility for servicemen and women; our dedicated Armed Services Engagement Manager on site works with agencies such as the Careers Transition Partnership, regional Resettlement Centres and local groups, to promote work placement and sustainable employment opportunities to ex-service personnel. To date, 50 positions within Interserve and its supply chain have been advertised, with 19 veterans employed on the project team.

BUILDING A BRIGHTER FUTURE

CELEBRATING DIVERSITY IN CONSTRUCTION

Purple Futures, is a partnership between Interserve, 3SC, P3 and Shelter that manages five Community Rehabilitation Companies for the Ministry of Justice. Purple Futures delivers probation and rehabilitation services to reduce reoffending. Our Charity Charter, based on the government’s market stewardship principles, governs how we work with our 60 Voluntary Charity Social Enterprise (VCSE) partners, with whom we spend over £7m per year and have supported to generate 170 new jobs since 2015.

PROVIDING PROBATION AND REHABILITATION SERVICES

On Mandela Day in South Africa our RMD Kwikform teams supported local labourers in the Centurion Industrial Area to improve their marketing skills and win more work opportunities. Labourers compete daily for adhoc work in manual trades such as brick-laying, plastering, tiling, painting and plumbing. We invited them to our offices where we produced business cards, endorsements and posters to help them market their abilities, supporting 75 labourers to win ongoing repeat work.

MANDELA DAY MARKETING MARATHON

Further reducing barriers to employment and supporting excluded groups through new targets that enable social inclusion

Continuing to champion diversity and inclusion

Build on the success of our networking groups by broadening the scope to include a Disability Network

JUSTICE INNOVATION FUND HAS OFFERED £620,000 TO SUPPORT NEW PROJECTS THAT REDUCE REOFFENDING

PURPLE FUTURES SUPPORTS 40,000 OFFENDERS, ACROSS FIVE REGIONS

£14M SPEND WITH VCSEs SINCE 2015, WORKING WITH 60 VCSEs, CREATING 170 NEW VCSE JOBS

3,500 LONG-TERM UNEMPLOYED HELPED INTO WORK IN 2016

http://goo.gl/wxdzB7


ACT WITH TRANSPARENCY

MAJOR ACHIEVEMENTS CHAIRED THE SUPPLY CHAIN SUSTAINABILITY SCHOOL MODERN SLAVERY

SPECIAL INTEREST GROUP COLLABORATED TO DEVELOP NUMEROUS RESOURCES TO SUPPORT THE

IDENTIFICATION, INVESTIGATION AND PREVENTION OF MODERN SLAVERY UPDATED OUR HUMAN RIGHTS POLICY, CODES OF CONDUCT AND

PUBLISHED OUR MODERN SLAVERY STATEMENT ON OUR WEBSITE Read it here: https://goo.gl/ZXXjom

ENGAGED WITH THE BUSINESS AND HUMAN RIGHTS RESOURCES CENTRE ON OUR APPROACH TO HUMAN RIGHTS IN OUR QATAR-BASED OPERATIONS

OPEN BOOK ACCOUNTING OFFERED TO CUSTOMERS AT TENDER STAGE

WHAT HAVE WE DONE?Our values and our culture guide us to operate ethically and transparently, which is important to build trust and confidence. Acting in a transparent way helps us make decisions that are in the best interests of customers we support and people we employ around the world.

Modern Slavery and transparency We have a workforce of c51,000 in the UK, c9,000 in our overseas subsidiaries and c20,000 in our Middle East associate companies, delivering construction, support services, and frontline services covering a range of sectors, worldwide. In addition to our directly-employed workforce there are many people employed in our supply chain.

We are committed to ensuring that Modern Slavery does not exist in our workforce or our supply chain. The introduction of the 2015 Modern Slavery Act focused us on the need to review our existing human rights policies, improve our processes, and implement additional checks to ensure that Modern Slavery does not exist in our workforce or supply chain. During 2016 we worked with the Supply Chain Sustainability School chairing a special interest group, and collaborated with other businesses to produce resources to support the identification, investigation and prevention of Modern Slavery.

Our goal is to embed a culture of transparency and openness throughout our business. We provide a wide range of services to the public and private sectors where the need to deliver value for money is matched by the need to provide quality services that are accountable to those that use them.

GOAL 4

We also rolled out our own internal checklists which were completed by all our businesses to identify risks and preventative actions. This led to changes in recruitment processes to include additional checks and amendments to agency contracts. We also introduced our worker engagement process in our Middle East operations to help validate our supply chain recruitment and employment practices. We audit both our own employee accommodation facilities and those of our supply chain.

Acting in an ethical wayOur ethics policy ‘Conducting business with Interserve’, is publicly available and describes the standards we set for ourselves, and those we expect from our sub-contractors and suppliers who work with us.

Find out more on conducting business with Interserve: goo.gl/DiCqmS

We review policies on Anti-Bribery and Corruption, Competition Compliance and Supplier Codes of Conduct annually. These help us manage our risks and we had no incidents of bribery or corruption last year, nor any human rights violations.

We further protect against anti-bribery and corruption by providing employees with training and include statements in the terms and conditions of contracts. During 2016 115 employees took part in face-to-face Director’s duties training, while 1,352 and 1,003 managers completed mandatory annual e-learning modules on anti-bribery and competition law compliance, respectively. We continue to include anti-corruption training as part of initial inductions, and this year we developed our ‘Smart Choice Toolkit’, a mobile app that helps people to make the right choices if they find themselves in difficult circumstances.

We operate and publicise a whistleblowing procedure through which any of our employees or the employees of our supply chain can anonymously report any wrongdoing by or within the organisation. Whistleblowing notifications and investigative outcomes are reported to the Audit Committee at each of its meetings. We also report anything falling short of a whistleblowing notification, which we class as a complaint, to the Audit Committee.

OUR CHALLENGES Modern Slavery risks vary across our operations - we need

to ensure consistent good practice is adopted in engaging with employees and the supply chain

Our broad and geographically dispersed supply chain means auditing third parties is resource intensive

Getting the balance right between sharing information and commercial constraints

OUR SHOWCASE

In 2016, following our success in Big Society Capital’s ‘Business Impact Challenge’ for our concept of the ‘Public Services Lab’ (PSL), Interserve formed a limited liability company with Catch22, Big Society Capital and Club Finance. The Lab, called ‘Capacity’ supports the voluntary, community and social enterprise (VCSE) sector to compete successfully for public sector contracts by directly connecting them with commissioners and bringing transparency to the commissioning process. This helps to break down barriers to competition and create new approaches to achieve significant change.

The PSL won the ‘Innovative New Idea’ award at the 2016 Finance for the Future Awards recognising ideas with the potential to have a tangible impact on society, in line with the United Nation’s Sustainable Development Goals. So far, over 1000 VCSE organisations and 18 public sector bodies have been surveyed to understand the gaps that exist in working together, and a programme of activity will be formally launched in 2017.

HELPING SOCIAL BUSINESSES COMPETE FOR PUBLIC SECTOR WORK

Raising awareness of Modern Slavery and providing tailored training for different levels in the organisation

Identifying appropriate corporate human rights standards to benchmark our approach against

Providing greater mentoring and support for VCSE businesses to compete for contracts to deliver social benefit

WHAT’S NEXT?

https://goo.gl/ZXXjom

http://goo.gl/DiCqmS



WHAT DOES THIS MEAN?Enabling all people to learn, grow and succeed. Giving people the skills, opportunities, knowledge and space in which to be inspired, creative and do great things. We want to be a great place to work for our people and support others to fulfil their ambitions.

OUTCOME 3

8,500 PEOPLE ENGAGED THROUGH SITE VISITS, TOOLBOX TALKS AND E-LEARNING AS PART OF OUR EMPLOYEE ENGAGEMENT PLAN ON SUSTAINABILITY

14 PARTNERSHIPSWITH FURTHER EDUCATIONAL INSTITUTIONS

TO HELP DEVELOP AND DELIVER SUSTAINABLE SOLUTIONS

600+ GRADUATES, TRAINEES AND APPRENTICES

ON PROGRAMME, UP FROM 250 IN 2013

£20 MILLION INVESTED IN INNOVATION

45 PEOPLE WON AWARDS AT OUR TRAINING TRUST AWARDS

15 PARTNERSHIP PROJECTS TO DEVELOP INNOVATIVE BUSINESS SOLUTIONS

LOOKING FORWARD

We’ve updated this outcome to reflect the fact that it applies equally to our operations for private-sector customers as our public sector customers. We’ve introduced a new goal to reflect the importance of providing a great customer experience. Our existing goal to ‘Act with transparency’ becomes part of ‘Upholding the highest ethical standards’.

As well as continuing to stay on top of the ethical issues we manage day-to-day as a business and encourage the right behaviours through our company values, we’ve renewed our commitment to championing diversity, inclusion and human rights across all of our operations and to gaining independent assessment of our progress.

Our new goal, to ‘Deliver outstanding service’ means that whatever we do, we do it well. We work hard for our customers to deliver a great service. Whether this is building a school, maintaining commercial offices, cleaning a shopping centre or supporting people through apprenticeships. We work together to have a positive environmental and social impact.

We achieved our target to apply our sustainability code of conduct to 50% of suppliers by 2016. Our 2018 target to apply this to all our suppliers will continue to be a focus under our goal to ‘Buy sustainable products and services’.

We already offer public sector customers the option of open book accounting. We will continue to seek ways to improve transparency, however as this is now embedded in our processes it will no longer be part of our set of targets going forward.

We achieved our target to gain Investors in Diversity or equivalent accreditation by 2018, two years ahead of schedule with our National Equality Standard. Our commitment to diversity and inclusion continues in our new set of 2020 actions. Our target to double opportunities for disadvantaged groups has been elevated to a goal to ‘Enable social inclusion’ and replaced with a 2020 target to improve the lives of 25,000 people through the work we do.

SERVICES IN THE PUBLIC INTEREST


CHAMPION DIVERSITY AND INCLUSION THROUGH THE

NATIONAL EQUALITY STANDARD (UK), AND UN GLOBAL COMPACT

EVIDENCE LEADING PRACTICE AGAINST A CORPORATE

HUMAN RIGHTS STANDARDWORK TOGETHER ON 250PROJECTS THAT DELIVER SUSTAINABLE OUTCOMES

DELIVER OUTSTANDING SERVICE

DELIVERING SERVICES IN AN ETHICAL AND EFFECTIVE WAY. THAT GO ABOVE AND BEYOND FOR THE CUSTOMER.

IN EVERYTHING WE DO WE MAKE SURE WE’RE A RESPONSIBLE, ETHICAL ORGANISATION. AND THAT WE DELIVER A GREAT SERVICE TO OUR CUSTOMERS.


OUR GOALS



OFFER ‘SUSTAINABILITY AS STANDARD’

MAJOR ACHIEVEMENTS WON THE BUILDING INFORMATION MODELLING (BIM) EXCELLENCE AWARD AT THE

CONSTRUCTION NEWS AWARDS FINALISTS FOR THE ‘WORKPLACE IMPACT AWARD’ AT THE BRITISH INSTITUTE OF FACILITIES

MANAGEMENT (BIFM) AWARDS INTRODUCED A ‘VALUE-ADD TOOLKIT’ WITH A RANGE OF SUSTAINABLE

SOLUTIONS FOR OUR CUSTOMERS SHORTLISTED FOR EDIE ‘SUSTAINABLE BUSINESS OF THE YEAR’ 2017

WHAT HAVE WE DONE?We are constantly developing tools, processes and harnessing innovation to improve our service delivery, matching our customers’ needs to the best ideas in the marketplace. Our customers look to us for solutions beyond our core delivery of construction and facilities management, including creating local employment opportunities, offering apprenticeships or work placements for young people, or developing initiatives that save energy or resources.

Our experience finding and delivering these solutions has allowed us to build a solid base of knowledge and best practice which we can learn from, share, and use to generate ideas that help us to integrate sustainability into every part of our work.

Focusing on the customer experienceIn 2016 we brought together a team to focus on our customer experience and communicated our new customer promise which puts innovation and doing more with less at the heart of our proposition. Our ‘Voice of the customer’ programme provides a way to ensure our customers and their feedback are at the forefront of our decisions.

In our international operations, working groups have agreed standards for water, biodiversity and sustainable procurement that benefit our customer by helping our businesses take the same approach wherever they are in the world.

Harnessing technology for sustainable outcomesSustainAbilities is central to how we consider problems and design solutions, offering sustainable options at every stage - from tenders to the design of buildings to how we then manage them.

We’re using Building Information Modelling (BIM) as a key tool to help us both plan and design a building. Using digital 3D virtual models we see that BIM brings real benefits for both efficiency of design and facility operation. We were proud to be recognised for the way we’ve adopted BIM at the 2016 Construction News Awards.

Offering ‘sustainability as standard’ is part of how we do business. We want to be sustainable in the way we manage our operations, buy products and services, and help our customers to achieve their goals by bringing new ideas and ways of doing things.

GOAL 5

14 PARTNERSHIPS WITH FURTHER EDUCATIONAL INSTITUTIONS TO HELP DEVELOP AND DELIVER SUSTAINABLE SOLUTIONS

8,500 PEOPLE ENGAGED THROUGH SITE VISITS, TOOLBOX TALKS AND E-LEARNING

AS PART OF OUR EMPLOYEE ENGAGEMENT PLAN ON SUSTAINABILITY

OUR CHALLENGES Influencing sustainable design in construction is a challenge

where we are not involved in the early stages and are provided with pre-agreed specifications

A lack of demand for sustainable options in our international operations means there is a need to influence customers and regulation

A culture shift is needed to help people see re-used materials as an opportunity and not as inferior quality products

OUR SHOWCASE

Understand customers’ sustainability drivers and aligning with their ambitions

Developing a Sustainability Appraisal tool to assess proposed projects for carbon, water, biodiversity, social value, waste impacts and climate change resilience

Expanding our internal sustainability champion networks to share collective knowledge and experience and engage our people on SustainAbilities ambitions

We have cemented our position as leaders in 3D visualisation tools with the invention of LocusEye - a new 3D and augmented reality service that we’ve launched to demonstrate to customers how formwork and falsework systems will work. LocusEye converts complex 3D models into high quality almost photorealistic models, bringing our solutions to life. The tool even itemises parts and displays design measurements to aid specifications. LocusEye is fast becoming an important tool for our designers and customers alike.

In 2016 our client was looking for ways to operate their space efficiently and maximise resources, whilst continuing to look after their people. With SPICA Technologies we developed ‘Smart Building in a Bag’ - a mobile solution that uses sensors to collect data and measure almost anything ranging from air quality and humidity to occupancy and motion. Sensors transmitted data to the Cloud generating real-time dashboards and reports. The crucial data and insight generated savings of 21% per year on cleaning and security, and 3 tonnes CO2 per year due to changes in managing workspace and lighting.

To help us monitor, measure and evaluate our impact on reducing reoffending our Purple Futures business partnered with Manchester Metropolitan University’s Policy Evaluation and Research Unit (PERU) to understand what affects reoffending, and which of our interventions have the greatest impact both socially and economically. PERU are also evaluating our pilot ‘Personalisation’ programme - providing tailored support to individuals to access key support services that are local to them. By focusing on service users’ strengths, we want to give them choice and control to help them change their lives. Our research will assess which projects result in better outcomes for individuals and society.

EVALUATING OUR APPROACH TO REDUCING REOFFENDING

IMPROVING EFFICIENCY WITH OUR ‘SMART BUILDING IN A BAG’

We have developed a ‘Value-add toolkit’ which provides practical examples of products, services and projects we can offer our customers. These range from reducing carbon, water or waste, to engaging with communities or creating employment opportunities. This enables our business development teams to choose potential options in response to our customers’ requests, and offer a range of sustainable solutions. The checklist provides indicative costs, and generates a Key Performance Indicator to measure our delivery which if chosen by a customer is added to our contractual obligations. This is a great way that we are offering ‘sustainability as standard’.

FACTORING SUSTAINABILITY INTO OUR CUSTOMER OFFERING

DEVELOPING CUSTOM SOLUTIONS THATBRING PROJECTS TO LIFE

WE USE ZAPLOK – A NEW PIPELINE COATING THAT REDUCES CORROSION AND MAINTENANCE COSTS FOR CUSTOMERS IN OMAN.

WHAT’S NEXT?


INSPIRE FUTURE PROFESSIONALS

MAJOR ACHIEVEMENTS AWARDED A ‘TOP 100 APPRENTICESHIP EMPLOYER’ BY NATIONAL APPRENTICESHIP SERVICE

AND ‘MACRO EMPLOYER OF THE YEAR’ AT THE NATIONAL APPRENTICESHIP AWARDS HIGHLY COMMENDED AT THE MIDLANDS NATIONAL

APPRENTICESHIP AWARDS 2016 OUR APPRENTICES WON ‘NEW PROFESSIONAL OF THE YEAR’ AT THE CONSTRUCTION

EXCELLENCE AWARDS AND ‘ADVANCED APPRENTICE OF THE YEAR’ AT THE NATIONAL APPRENTICESHIP AWARDS 2016

LAUNCHED AN ENGINEERING TRADE TRAINING SCHOOL IN QATAR FOR THE FIRST TIME OFFERING MECHANICAL, ELECTRICAL AND PLUMBING COURSES

WHAT HAVE WE DONE?In 2016 we achieved our target to double the number of apprentices, trainees and graduates on our early career programme, with 600 young people benefitting from roles in the business. We’ve also increased our work placement and education outreach activities by almost a third, with 2,900 young people taking part in 2016.

Preparing for the Apprenticeship LevyDuring 2016 we have been preparing for the new Apprenticeship Levy launched in April 2017. We see this as an opportunity to build skills and employment opportunities across our diverse business, and support career pathways by providing apprenticeships for both new and existing employees.

Our Interserve Learning and Employment business is expanding to manage the recruitment, training and delivery of our new apprenticeships, including identifying apprenticeships that align with business strategies. Key to this is ensuring we offer quality apprenticeships, and raise the profile of Interserve as a great place for people to work. Our collection of awards in 2016 evidence our investment in our apprentices, and how we are supporting and recognising their hard work and talent.

Investing in skills and developmentWe are committed to investing in our people, giving them the knowledge and skills they need. In 2016 we expanded our online learning management system enabling users to browse and select centrally-provided training and development options. We launched a wider range of free courses making it easier for people to access self-service learning and increase their skills. We also embedded our peoples’ Personal Achievement and Development Planning (PADP) with the online portal to fully integrate their training records with career aspirations.

We’ve also continued to invest in our training schools in the middle east, in which account for 72% of our training days worldwide. Schools train employees in skills such as plastering, blockwork, tiling and joinery which encompass our safety, sustainability and quality requirements. This year we expanded our offering to launch a new engineering trade training school in Qatar for the first time offering Mechanical, Electrical and Plumbing courses, giving our people even more opportunities to grow into future roles.

We inspire young people by engaging through schools and colleges, and providing placements and early career recruitment opportunities. We're also investing in attracting, developing and retaining talented people who share our vision and values to enable us to work better, be stronger and achieve more.

GOAL 6

15 NEW WOMEN IN SCIENCE AND ENGINEERING (WISE) AMBASSADORS

600+ GRADUATES,TRAINEES ANDAPPRENTICESON PROGRAMME

100,000TRAINING DAYS AROUND THE WORLD

2900+ WORK EXPERIENCE PLACEMENTS

14,000 APPRENTICES SUPPORTED THROUGH INTERSERVE LEARNING & EMPLOYMENT

45 PEOPLE

WON AWARDS AT OUR TRAINING TRUST AWARDS

SCIENCE, TECHNOLOGY, ENGINEERING AND MATHS (STEM) AMBASSADORS WORLDWIDE

OUR CHALLENGES Competition in the marketplace for apprentices will be high

- we want to be an employer of choice Maintaining stable and regular work experience

programmes with local schools and colleges, which align with recruitment opportunities

Anticipating the changing role or technology in the workplace and requirements for reskilling of employees

OUR SHOWCASE

Developing our International graduate programme to increase diversity, and retain talent

Using the Apprenticeship Levy as an opportunity to upskill our existing employees

Embedding mentoring of social enterprises as an element of our leadership programmes

Focus on increased competence as a result of training

We’ve begun connecting with the community around our new regional hub Ingenuity House, which is currently under construction in the Midlands. Last year we set a competition for art and design students at Solihull College and University Centre to develop concepts for our site hoardings. The winning team were awarded a £1000 prize, and given a contract to develop our annual awards brochure!

We launched a career programme across our Healthcare, Justice and Learning and Employment businesses for people without higher education qualifications. Open to people that may have started their careers late, career-changers, or who have achieved only vocational experience, last year twenty people undertook business placements, projects or leadership qualifications to advance their professional development.

Our Healthcare business provides an inspiring work placement programme for local schools. Groups of students spend a week tackling interactive activities based on real-life scenarios, such as a Norovirus outbreak, which sees them juggling staff shortages, quarantines and the media. Our Intersection House office in the Midlands also runs a busy work placement programme, with 60 students joining us last year, and 5 school leavers going on to gain apprenticeships or in full time employment. We've also developed 'the Greens', a family of farming superheroes that help and encourage children to eat healthier, nutritionally balanced food where we provide school catering.

GIVING YOUNG PEOPLE A TASTE OF INTERSERVE

IT’S NEVER TOO LATE TO INVEST IN SKILLS

Our contract to build 7 secondary schools in Hertfordshire, Luton and Reading had ambitious targets for creating social value and legacy in the community. Over the life of the three year contract, which completed in 2016, Interserve provided 437 work placement days on construction sites including 140 days of employability bootcamps with pupils that could not attend work experience due to behaviour, confidence or other barriers. Training was also provided for the local supply chain including 60 individuals completing NVQ training and 67 taking Advanced Health and Safety courses. 150 education events directly engaged over 4000 young people on construction-related careers and training.

PROVIDING OPPORTUNITIES TO INCREASE SKILLS AS STANDARD

GROWING ROOTS IN OUR NEW COMMUNITY

TWO UK CONSTRUCTION GRADUATES COMPLETED A 3 MONTH ROTATION IN OUR OPERATIONS IN QATAR, SEEING FIRST-HAND HOW OUR ACTIVITIES DIFFER IN OUR TWO MAIN MARKETS

WHAT’S NEXT?


CREATE A CULTURE OF INNOVATION

MAJOR ACHIEVEMENTS FINALIST FOR OUR ‘EMPLOYEE OF THE YEAR’ AWARD DEVELOPED A GROUND-BREAKING

INNOVATION, LOCUSEYE, WHICH USES VIRTUAL REALITY TO BRING OUR EQUIPMENT DESIGNS TO LIFE

WON THE ‘INNOVATIVE NEW IDEA’ AWARD AT THE 2016 FINANCE FOR THE FUTURE AWARDS FOR CAPACITY: PUBLIC SERVICES LAB, MAKING PUBLIC SECTOR PROCUREMENT MORE ACCESSIBLE TO THE VCSE SECTOR

ESTABLISHED CENTRES OF EXCELLENCE FOR TEAMS TO SHARE AND PROMOTE BEST PRACTICE ACROSS ENERGY, CLEANING AND PROJECTS

WON THE IFM ‘TECHNOLOGY IN FM’ AWARD 2017 FOR SMART BUILDING IN A BAG

WHAT HAVE WE DONE?We’re using digital technology and big data to prepare for advancements that will help us to build and manage buildings more efficiently.

Creating a platform for innovationHaving a clearly communicated process for managing innovation is critical to ensure people trust us to listen to their ideas. They can contribute to our idea campaigns, post ideas or respond to suggestions on our internal discussion groups. Our Innovation Team regularly updates our ‘Ingenuity at Work’ group with progress on pilot projects, new innovations and questions that we’d like help solving.

We also use Hype, an online tool that allows us to ask our innovation community questions, gain feedback on proposed innovations and stimulate ideas to solve challenges. This not only provides a way to share good ideas, but most importantly it encourages engagement and collaboration with our customers, account teams and the wider business. Once interest, demand and applicability has been understood, we have a team that researches the innovation in more detail. Depending on interest within our customer base we look for opportunities to trial these ideas, and then share the results so that the very best ideas can be adopted more widely to support both our people and our customers.

Getting ready for the future Changing technology has the potential to place different demands on the skills required to deliver our work, so we’re thinking ahead about opportunities to retrain and reskill people to manage this transition. We’re also engaging with our people to find ways to leverage the new opportunities offered by advances in digital construction and artificial intelligence. Using our network of innovation champions, we’re leading industry developments and challenging our people to identify, develop and evaluate projects that improve what we do – in 2016 this included a tool to make the laying of pipeline safer and more efficient, adopting a new approach to supply chain management and development of a performance measurement tool.

To stay ahead in the marketplace, we’re investing in innovation to make sure we offer forward-thinking solutions and new ideas to improve the way we work. Solving our customers’ challenges and implementing ideas that tackle key social and environmental challenges.

GOAL 7

OVER 2600 MANAGERS HAVE SUSTAINABILITY TARGETS IN THEIR APPRAISALS

15 PARTNERSHIP PROJECTS TO DEVELOP INNOVATIVE BUSINESS SOLUTIONS

£20M+ INVESTED IN INNOVATION RELATED ACTIVITIES

£0.3M INNOVATION GRANTS AWARDED TO SUPPORT NEW IDEAS TO REDUCE REOFFENDING

11 ADOPTED

7 IN DELIVERY

10 TRIALLED

12 IN EXPLORATION INNOVATIONS SUBMITTED THROUGH INNOVATION CAMPAIGNS

OUR CHALLENGES Finding test projects for trials, day-to-day project

constraints can restrict opportunities The process for reviewing innovations must be visible:

people won’t share an idea if they don’t see what happens to it, we need to share stories of success and failure!

Managers need to encourage innovation and inspire creativity, as well as providing the time for employees to experiment

OUR SHOWCASE

Looking at ways we can harness artificial intelligence as part of future workplace automation

Implementing a common innovation sharing mechanism across the business

Finding new ways to communicate innovation to our people who can’t access online forums but who benefit from and contribute to innovation

Our strategic move into the UK geotechnical sector saw RMD Kwikform rollout a range of new ground shoring systems, with 13 new product ranges offering 337 new products. This enables us to service the complete requirements of customers, from ground shoring to formwork and falsework, providing the market with a single supplier solution. We also use the latest 3D modelling techniques and new ways of working, including using virtual reality to plan projects. The new product range has attracted 36 new customers and now accounts for 6% of our overall hire revenues.

We helped the University of Sussex to identify potential water leaks in its district heating system using Unmanned Aerial Vehicles to identify heat spots at night. Pipelines serving warm water and heating to the 170 acre campus are buried beneath the ground, making water leaks and pipeline malfunctions difficult to locate. Using thermal imaging cameras mounted on UAVs, we were able to efficiently survey the vast area creating a thermal footprint that highlighted anomalies that could be traced and fixed.

Our partnership that delivers probation services - Purple Futures - invested over £300,000 in 2016 into an innovation fund, which is open to third sector organisations that bid for funding for projects that offer new ideas to help reduce the number of people reoffending. The fund acts as a start-up incubator for pilot projects which have the scope to become part of our core service offering if results are proven. Access to housing is critical in order to integrate service users back into society. Yet changes to housing benefits and a lack of supply of properties suitable for social tenants have resulted in a lack of access to housing. The Innovation Fund awarded £65,000 to Foundation, a social housing charity to develop a new social lettings agency that provides service users with better access to the housing market. The fund has also supported a 22 week programme for service users to become qualified boxing coaches, gaining skills and confidence to break the cycle of reoffending.

INVESTING IN PILOTS THAT SUPPORT OFFENDER REHABILITATION

USING UNMANNED AERIAL VEHICLES TO IDENTIFY WATER LEAKS

Building Information Modelling (BIM) is a digital representation of the physical and functional characteristics of a facility. We use it in a variety of ways, for example; to improve collaboration, programming, scheduling and reduce material waste, as well as improving environmental performance modelling. It’s a powerful tool to manage data across teams of architects, engineers, project managers, end-users and the customer - enabling better decisions to be made. For example, on our project to build the Proton Beam Therapy Centre for the Christie NHS Foundation Trust, we used BIM models and associated data to coordinate vendors and sequence site logistics for a ‘right first time’ installation, which aims to save time and money. Our commitment to digital collaboration with customers was recognised with the BIM Excellence award at the Construction News Awards.

BRINGING BUILDINGS TO LIFE WITH DIGITAL 3D TECHNOLOGY

BREAKING GROUND IN NEW MARKETS

ONE OF OUR TEAMS IN OMAN WON AN INNOVATION AWARD FOR A POTENTIALLY LIFE-SAVING DEVICE TO LAY PIPELINES, DEVELOPED TO ELIMINATE THE NEED TO WORK IN A CONFINED SPACE

WHAT’S NEXT?


POSITIVE ENVIRONMENTAL IMPACT

WHAT DOES THIS MEAN?We protect and improve the environment. We source raw materials responsibly and use them efficiently. We conserve water, minimise carbon emissions and seek to avoid waste wherever possible, finding alternative uses for resources where this isn’t possible.

OUTCOME 4

UK OPERATIONS ACHIEVED 99% CERTIFIED SUSTAINABLE TIMBER

89% OF PRODUCTS CONTAINING PALM OIL WERE ACCREDITED TO THE ROUNDTABLE ON SUSTAINABLE PALM OIL (RSPO) STANDARD

TOTAL CARBON EMISSIONS

-18%

WE ACHIEVED OUR TARGET OF A 25% ABSOLUTE

REDUCTION IN CONSTRUCTION

WASTE

NATIVE PLANTS GROWN IN QATAR AS PART OF OUR NATIVE PLANTS PROGRAMME

TOTAL WATER CONSUMPTIONDOWN BY

-14% RELATIVE METRIC: M3/£M

2 0 1 6 P E R F O R M A N C E V S . 2 0 1 3

(RELATIVE METRIC: TONNES CO2E /£M)2016 PERFORMANCE VS. 2013

LOOKING FORWARD

Our new goal to ‘Enable social inclusion’ increases our focus on providing opportunities for disadvantaged groups and breaking down barriers to employment. We’re also evolving our goal to ‘Inspire future professionals’ to ‘Develop and inspire people’, to cover our existing as well as future workforce, and the people we support to develop skills through our Learning & Employment business and rehabilitation services.

Our new actions reflect our ambition to support people to overcome challenges, gain work experience, qualifications and employment, now and in the future. They also help us prepare for the changes we expect to impact the workforce over the next 5-10 years, ensuring people have the skills to adapt.

We no longer have a dedicated goal on innovation, but innovation remains a key theme throughout the plan. We need new ideas and innovation to help us achieve all of the future targets we’ve set ourselves. Our goal to offer customers sustainability as standard is replaced by our broader goal to ‘Deliver outstanding service’ as sustainable delivery is part of how we do business.

We achieved our 2018 target to double the number of apprenticeships, traineeships and graduates in our business two years ahead of schedule.

We’ve also achieved our target to develop 3 business partnerships dedicated to innovation in sustainability including our partnership with Social Enterprise UK to host the Social Value Summit, Groundwork to develop our Social Mapping Tool and Big Society Capital, Catch22 and Club Finance to launch Capacity – The Public Service Lab. In fact, there are many more partnerships than we can cover here.

Collaborative working will continue to be an important part of our approach to sustainability. Having achieved our targets in this outcome, our new targets provide the direction going forward.


ENABLE SOCIALINCLUSION

IMPROVE THE LIVES OF 25,000 DISADVANTAGED PEOPLE

ACHIEVE A FUTURE PROOF WORKFORCE FIT FOR 2030

SUPPORT 15,000 APPRENTICES, CREATE 1,000 APPRENTICESHIPS

DEVELOP ANDINSPIRE PEOPLE

HELPING PEOPLE BE THE BEST THEY CAN. PROVIDING SKILLS AND TRAINING. AND ACCESS TO OPPORTUNITIES.

WE ENABLE PEOPLE TO DEVELOP SKILLS, BUILD CONFIDENCE AND ACHIEVE THEIR AMBITIONS. PROVIDING TRAINING AND SUPPORT REGARDLESS OF BACKGROUND, HELPING PEOPLE GAIN EXPERIENCE AND ACCESS OPPORTUNITIES.


OUR GOALS



PROTECT THE NATURAL ENVIRONMENT

MAJOR ACHIEVEMENTS WORKING WITH CAMBRIDGE INSTITUTE OF SUSTAINABILITY LEADERSHIP, GREEN ALLIANCE

AND SAVILLS ON THE NATURAL CAPITAL IMPACT GROUP TO IDENTIFY STRATEGIES TO PROTECT NATIONAL INFRASTRUCTURE AND ENHANCE THE NATURAL ENVIRONMENT

JOINED THE PRINCE OF WALES’S CORPORATE LEADERS GROUP PROMOTING ACTION ON CLIMATE CHANGE

DEVELOPED NATURE+ APPROACH TO ENVIRONMENTAL MANAGEMENT AND ACHIEVING A POSITIVE IMPACT

RESPONDED TO CARBON DISCLOSURE PROJECT'S (CDP’S) FOREST PROGRAM FOR THE FIRST TIME

WHAT HAVE WE DONE?Responsibly managing our operationsWe adopt an integrated management system that combines health, safety, quality and environment management procedures to OHSAS 18001, ISO 9001 and ISO 14001 standards. During 2016 our support services business developed a new, easy-to-use Aspects and Impacts register to identify their main environmental impacts and the control measures they have implemented to reduce risk. This has enabled us to standardise and improve our approach, identify the greatest risks and to prioritise our efforts accordingly. 86% of our operations are currently covered by ISO14001 certification and our Support Services operations were one of the first to be certified under the new ISO 14001:2015 criteria.

We are also updating our handheld devices to include site inspection data and a dashboard for environmental incidents on our construction sites. Despite our work to find new and better processes for managing environmental hazards however, we incurred financial penalties for two historical environmental compliance failures in 2016. These incidents have been reviewed and the lessons learned have been shared with our teams to avoid future incidents.

Setting high standards for biodiversity During 2016 we reviewed how we manage biodiversity, ecosystems and raw material sourcing, and the key actions we want our people to take to protect and enhance the environment. Our clear messages ‘Do no harm’ ‘Maintain’ and ‘Improve’ are designed to guide people on what to do and together form our ‘Nature+’ approach which we intend to roll out across the business in the coming years.

Natural resources are finite, yet worldwide people and business are putting unsustainable pressure on these resources. Our aim is to operate in a way that maintains and improves the natural environment in which we live and work.

GOAL 8

80% OF OUR GLOBAL

TIMBER USE IN CONSTRUCTION WAS CERTIFIED SUSTAINABLE TO FSC OR PEFC STANDARD

DO NO HARM RESPECT HABITATS AND SPECIES WHERE WE WORK, MINIMISE AREAS OF NATURAL HABITAT DAMAGED

MAINTAIN PROTECT NATURAL HABITATS AND MANAGE LAND AND HABITATS IN OUR CARE EFFECTIVELY

IMPROVE PLANT CAREFULLY CHOSEN TREES/PLANTS, PROVIDE NEW HABITAT AND ENCOURAGE DESIGNS THAT WORK WITH NATURE

NATIVE PLANTS GROWN IN QATAR AS PART OF OUR NATIVE PLANTS PROGRAMME

86% OF OUR OPERATIONS ARE CURRENTLY COVERED BY ISO14001 CERTIFICATION

UK OPERATIONS ACHIEVED 99% CERTIFIED SUSTAINABLE TIMBER

89% OF PRODUCTS CONTAINING PALM OIL IN SUPPORT SERVICES WERE ACCREDITED TO THE RSPO* STANDARD

In our middle east operations we developed our biodiversity checklist into a Biodiversity Standard for arid climates that sets out what we expect to see on all sites to help inform our teams on the actions to take to improve biodiversity.

Responsibly sourcing raw materials In 2016 we continued to make progress on sustainable sourcing of forest products including timber and palm oil. Globally, we source 80% certified sustainable timber for use in our operations and have engaged with our supply chain to quantify the percentage of certified sustainable palm oil and soy used in the cleaning and food products we use. We also responded to CDP’s Forest Program for the first time. We are pleased to be one of the first in our sector to take part and achieved a score of ‘B’ in relation to our disclosures on timber and ‘C’ for our disclosures on use of palm oil, soy and cattle products.

OUR NATURE+ APPROACH

*RSPO = Roundtable on Sustainable Palm Oil

OUR CHALLENGES Market maturity and information available on certified

sustainable forest products, particularly soy, is low Developing the right supply chain processes and controls

to ensure a full audit trail for certified sustainable timber products

Encouraging uptake of natural environment improvements - these are often considered a ‘nice to have’

OUR SHOWCASE

Ensuring robust environmental plans are in place across our business and increasing awareness of our new Nature+ approach

Sharing learnings from the implementation of our new Environmental Management System to enable assessments by non-professionals

Enhancing the capability of our Construction site apps to include a dashboard for environmental incidents

Our Abu Dhabi team participate in the United Arab Emirates National Environment Day on 4th February annually. In 2016 volunteers cleaned up and collected litter at Al Hail industrial zone, restoring the area for the benefit of local wildlife and the community. This is part of a wider series of activities and events across the seven Emirates, with our teams also participating in desert clean-ups, tree-planting events and aluminium can collections arranged by the Emirates Environmental Group.

In Qatar we have committed to growing and planting 1 million native plants by 2020. To support this we introduced a closed loop aquaponics system at our plant nursery - the water from a tank containing Tilapia fish cycles through plant beds acting as plant fertiliser whilst also cleaning the water of waste, with clean water cycled back into the fish tank. In 2016 the nursery provided more than 90,000 indigenous plants including shrubs, fruits and vegetables that we are using for natural shading, landscaping on customer sites, and for local community greening projects. Our ambition is also to use the food in our catering kitchens!

At the White Rose Shopping Centre in Leeds, our Cleaning Team Leader looks after a surprising secret - six colonies of bees are housed on the roof! Following a two year course, and in consultation with our customer, the beehives were installed to support our shared environmental objectives including supporting the local bee population, which has been at risk due to pests and parasites. The award-winning honey resulting from the project has raised awareness of supporting bee habitats in Leeds, and raised the profile of the shopping centre. The centre plans to gift honey to local community projects.

KEEPING BEES IN UNLIKELY PLACES

GROWING 1 MILLION PLANTS IN THE DESERT

As part of the UK government’s Building Schools for the Future programme, we were contracted to build an extension at Roundhay School in Leeds. The site is home to 181 mature trees surrounding the school’s sports field with 43 different species including oak, silver birch and monkey puzzle. We conducted surveys of the trees to develop a maintenance plan for pruning and removal of diseased or damaged limbs. These historically significant trees are now inspected annually to maintain habitat for local wildlife and preserve the valuable services the trees provide.

CONSERVING TREES FOR FUTURE GENERATIONS

GETTING OUR HANDS DIRTY IN ABU DHABI

WE WORK WITH LOCAL NGOs INCLUDING EMIRATES ENVIRONMENTAL GROUP, ENVIRONMENTAL SOCIETY OF OMAN AND WWF

WHAT’S NEXT?


CONSERVE AND REPLENISH WATER

MAJOR ACHIEVEMENTS DEVELOPED A WATER REDUCTION TOOLKIT TO HELP

SITES IDENTIFY AND IMPLEMENT WATER REDUCTION INITIATIVES RECOGNISED BY ARABIA CSR NETWORK FOR SUSTAINABILITY

ACHIEVEMENTS INCLUDING REDUCING WATER CONSUMPTION INVESTED IN IMPROVING WATER EFFICIENCY OF WASHROOMS

AND LAUNDRY FACILITIES CONDUCTED AN ASSESSMENT OF WATER RISK IN OUR SUPPLY CHAIN

WHAT HAVE WE DONE?Increasing efficiency and changing behavioursThere are many needs for water that cannot be avoided or reduced, though water is often too easily wasted. We want to use water in a more efficient way and change attitudes so that water is viewed as the valuable resource it is. Reducing our dependence on water is a major challenge, and whilst we’re proud of the progress we’ve made, we still have work to do.

Understanding our water useWe measure our water use in both absolute and relative terms. The absolute measurements compare the total volume of water consumed in 2016 with 2013 when we began our SustainAbilities plan, but this doesn’t take into consideration changes to our business, such as new sites, increased numbers of employees or new projects that may be more or less water intensive. So our relative measurements show how our water use has changed in relation to our turnover.

In our International operations, which account for 97% of our global water use, we achieved a 30% reduction in relative terms, although the total amount used increased 6% compared to 2013. In our UK businesses, we made reductions in both the total volume used and water consumption per £turnover, with 11% and 23% reductions respectively. We are pleased that overall we achieved a 14% relative reduction in water use, however in both regions we fell short of our 2016 target to achieve a 20% absolute reduction. Our new targets for 2020 will be set on a relative basis to reflect our changing operational profile.

Focusing on reducing water We’ve implemented action plans to reduce water use and created standards for our sites, to help us replicate those improvements which support our water efficiency ambitions. In our employee villages this includes increasing the water efficiency of washroom sanitary products, expanding our centralised laundry services, and including washing of personal clothes to free up employees’ recreation time as well as saving water.

Managing risk from water scarcityDuring 2016 we conducted a review of water risk in our supply chain to identify where we might be at risk of water stress, and looked at solutions in the event that we cannot buy products and services we need for our business. Overall, we found that switching to alternative locations for the relatively small volumes we source was the most viable option. More on this can be found on page 40.

A lack of available water can be a serious problem for our people, customers and suppliers, especially when they are based in water scarce regions. We want to use water efficiently and reuse it wherever possible.

GOAL 9

REDUCTION IN WATER USE IN THE UK, AVOIDING 3.8 MILLION LITRES

REDUCTION IN WATER INTENSITY IN OUR OVERSEAS OPERATIONS

1.1 BILLION LITRESOF WATER USE DISPLACED BY BIONEST SYSTEMS RECYCLING BROWN WATER

-14% REDUCTION IN WATER INTENSITY

OUR WATER USE

M3 WATER USE PER £M TURNOVER

500

550

450

400

350

3002013

OFFICES SITES/PROCESSES ACCOMMODATION

2014 2015 2016

OUR CHALLENGES Water is not seen as a valuable resource in the same way as

energy, making business cases difficult to prove Water is used for peoples’ welfare, so reducing water

consumption must be balanced with our people’s need to live well

Overcoming negative views around using recycled water

OUR SHOWCASE

Continued focus on reducing water consumption in our International operations which account for 97% of our water use

Move beyond use of actions plans towards standards on water use, extending these to our sub-contractor facilities

Further rollout of the second generation Bionest system, and promoting this to customers

We developed two online water reduction tools for our UK and International businesses. These simple spreadsheets ask a series of questions that sites can complete to generate an action plan giving specific water-saving suggestions. The surveys were completed by 164 sites and work is now underway to implement recommendations and improvements. In our International operations this was accompanied with a series of communication campaigns to highlight how users of our facilities can be more economical with water.

We designed, developed and installed a bespoke system for the Foreign and Commonwealth Office to reuse highly mineralised cooling tower water which was previously flushed away and replenished with mains water. Water is now taken through a five-step demineralisation process to be re-circulated into the cooling process. An added benefit is that using the demineralised water significantly reduces the amount of scale produced through evaporation, which in-turn has reduced the number of times the flushing process is required, saving c.90-100m3 of mains water per month. Since the installation in April 2016 the system has saved 873m3, equivalent to 38% of the total cooling tower water usage, and 4% of the total building usage, equating to a cost saving of approximately £1,900 per year.

We are supporting the South African government’s programme of water infrastructure improvements following a three-year period of severe drought. This will see the construction of a large number of reservoirs and water towers across drought-hit zones in the coming years, one of which, the Masheleni Water Tower in Mpumalanga, is being supported by our team in Nelspruit. We are using unique radial Rapidshor falsework to build the circular or conical water towers for water storage.

CLOSING THE LOOP ON COOLING WATER

SUPPORTING STRUCTURES FOR WATER STORAGE

DEVELOPING EASY-TO-USE TOOLS FOR GLOBAL WATER REDUCTION

We first started using the Bionest system in 2012 in response to Qatar’s dry and arid environment and low levels of annual rainfall. Bionest treats waste water for re-use for all non-consumption purposes. Water in Qatar has a big environmental impact due to desalination, and the use of tankers for water transportation so finding ways to reuse water has multiple benefits. In 2016 we introduced a second generation Bionest system which reduces the space required for the water treatment equipment, and reduces investment costs by 33% making it a more viable option for smaller sites. To date, there are 77 operational systems across the region, with over 1.1 billion litres of water being saved and over 50,000 truck journeys being eliminated during 2016.

INTRODUCING THE SECOND GENERATION BIONEST

WHAT’S NEXT?


WHAT’S NEXT?

HALVE CARBON EMISSIONS

MAJOR ACHIEVEMENTS IMPLEMENTED A NEW FLEET POLICY IN THE UAE, WITH THE TEAM WINNING AN AWARD FOR

THEIR EFFORTS IN REDUCING FUEL CONSUMPTION, CARBON EMISSIONS AND COSTS 1 MILLION LITRES OF FUEL SAVED IN THE UK THROUGH TRANSITIONING TO A LOWER CARBON

COMPANY CAR FLEET AND ENGAGING DRIVERS ON EFFICIENT DRIVING STYLES TRIALLED NEW TECHNOLOGIES SUCH AS HYBRID SOLAR-DIESEL GENERATORS WHICH REDUCE

CARBON EMISSIONS OUR CARBON WORKING GROUP DEVELOPED AND IMPLEMENTED CARBON AND TRAVEL

REDUCTION PLANS, AS WELL AS OUR CARBON AND ENERGY POLICY POSITION AWARDED CERTIFIED EMISSIONS MEASUREMENT REDUCTION SCHEME (CEMARS) GOLD

STANDARD FOR ACHIEVING CARBON REDUCTIONS OVER 5 YEARS

WHAT HAVE WE DONE?Increasing the efficiency of our operationsOur business is reliant on fuel which is used to generate power for our onsite machinery and equipment, as well as the vehicles used in our fleet - which together account for 68% of our total carbon emissions. That’s why we’ve focused efforts in our construction operations to improve efficiency of diesel use by providing sizing guides for generators, adopting hybrid generators where appropriate and investigating alternative technologies such as solar task-lighting.

Reducing the impact of our fleetIn the UK our carbon emissions are dominated by fuel use in our fleet, accounting for 51% of total UK emissions. In our international operations fleet fuel use accounts for 37% of our carbon emissions. That’s why we’ve invested heavily in upgrading to more efficient technology, tackling driver behaviour and changing the culture around business travel to reduce our emissions, and have achieved a 23% reduction.

Reducing emissions from our officesWe achieved an almost 20% absolute emissions savings at our permanent sites in the UK and a 6% absolute reduction across our international operations compared to 2013. We did this by focusing on improvements to accommodation, and installing more efficient air conditioning and equipment as well as reviewing our estate portfolio and reducing this where possible.

A positive balance Due to our dependence on fuel, we rely on the pace of change of technology to achieve our carbon emissions reductions, or we will have to offset (or inset) those emissions we’re responsible for. At present, this is cost prohibitive but over time we hope that solutions will become more viable.

The type of work we do also means our total carbon emissions are affected by the cyclical nature of projects and project requirements. For example, emissions in our International operations increased in 2016 due to two projects; a pipeline project in the desert requiring greater fuel for travel and the provision of an accommodation barge to house employees offshore for oil rigs we were maintaining. Together these projects equated to an additional 24,000 tonnes of carbon, masking an underlying 6% reduction through our carbon reduction efforts.

Our business generates carbon emissions through our buildings, business travel and on-site energy generation. We’ve set ourselves demanding carbon reduction targets in these areas to minimise our environmental impact.

GOAL 10

REDUCTION IN CARBON INTENSITY

EFFICIENCY OF NEW COMMERCIAL FLEET VEHICLES INCREASED BY 5%

5% REDUCTION IN CARBON EMISSIONS FROM BUSINESS TRAVEL, 23% REDUCTION IN CARBON INTENSITY

8% REDUCTION IN CARBON EMISSIONS FROM OUR ESTATE,26% REDUCTIONIN CARBON INTENSITY

SOURCES OF CARBON EMISSIONS

CARBON EMISSIONS PER £M TURNOVER

100

50

02013

OUR ESTATE OUR ONSITE OPERATIONS BUSINESS TRAVEL

2014 2015 2016

OUR CHALLENGES Our total carbon emissions fluctuate according to project

cycles and the type of work we have, which impacts our ability to achieve absolute emissions reductions

Waiting for grid connections for our sites can be time-consuming and results in greater reliance on carbon-intensive generators

Reducing the emissions associated with our fuel use requires faster pace of change in technology

OUR SHOWCASE

Demonstrating how more detailed consumption data can support targeted actions and investments to reduce emissions

Trialling a telematic smart phone driver app to raise awareness of fuel usage

Continuing to upgrade our employee villages with more efficient lighting, insulation and air conditioning units

Reviewing our carbon emissions targets, including considering science based targets

We commissioned an analysis of carbon emissions arising from our supply chain in our Support Services business. We found that our own carbon emissions are only one tenth that of our supply chain, which accounts for 300,000 tonnes carbon! We have focused our supply chain engagement activity on the highest carbon areas, such as food, energy and machinery. For example, reducing the amount of meat and dairy in our menus. In 2017 we’ll be engaging with our top 20 suppliers on carbon emissions reductions as a key discussion area in supplier management meetings.

During 2016 we replaced our UK company cars and commercial fleet with lower carbon emission vehicles. As a result, the combined efficiency of our van fleet increased 5% during the year, with new vehicles on average 9% more efficient than the vehicles they replaced. We also installed speed limiters and telematics units in 2,000 of our commercial vehicles. These record details of driver braking, acceleration, idling and driving style, and our drivers are now given a rating which encourages healthy competition. Investments in desktop video conferencing and changing the culture around meetings also helped to reduce our carbon emissions from business travel. Together, these measures contributed to 1million litres of fuel saved.

REDUCING EMISSIONS FROM OUR VEHICLE FLEET

To reduce carbon emissions from fuel use on our construction sites we are constantly looking at ways to improve our site set-up. This year we implemented a generator selection tool, enabling us to accurately specify the size of generator we need, and offer alternative energy strategies such as the use of hybrid solar/diesel generators which store and re-use excess energy as well as solar task lighting. In Dubai alone, we’ve avoided using 6.9m litres of fuel since 2013, equating to 18,020 tC02 through improving the sizing and efficiency of site generators to suit demand, rolling out more efficient EcoKabins for site offices and installing fuel security systems, as well as fleet improvements such as using In-Vehicle Management System tracking and providing training in journey management.

USING ALTERNATIVE TECHNOLOGIES TO POWER CONSTRUCTION

ANALYSING CARBON IN OUR SUPPLY CHAIN We’re moving to a cloud-based system for our IT infrastructure as part of our IT Modernisation programme. The changes will reduce emissions by using more efficient offsite data centres and reducing business travel by enabling mobile video conferencing.

HYBRID GENERATORS HAVE BEEN SHOWN TO EMIT 2 TONNES LESS CO2 PER WEEK THAN STANDARD SYSTEMS

MOVING TO THE CLOUD


MAKE WASTE A THING OF THE PAST

MAJOR ACHIEVEMENTS COMPLETED ‘DESIGNING OUT WASTE WORKSHOPS’ AS PART OF

CONSTRUCTION DESIGN PROCESS - AS A RESULT WE TRIALLED REUSING OLD STEEL PIPES FOR FOUNDATION PILING

ENGAGING IN INDUSTRY CONVERSATIONS TO ADVANCE CIRCULAR ECONOMY THINKING THROUGH OUR WORK WITH CONSTRUCTING EXCELLENCE AND BUSINESS IN THE COMMUNITY’S CIRCULAR ECONOMY TASKFORCE

DEVELOPED A BUSINESS CASE FOR ESTABLISHING A WASTE TRANSFER STATION TO ENABLE REUSE OF CONSTRUCTION WASTE IN DUBAI

UNDERTOOK PROJECT TO ANALYSE WASTE AT OUR PERMANENT SITES TO FIND BETTER WAYS OF MANAGING WASTE

WHAT HAVE WE DONE?Reducing waste, increasing efficiency We are delighted that last year we achieved a 25% reduction in construction waste against our 2013 baseline, achieving our ambitious target to reduce waste volumes by 25% by 2016. This equates to a 40% reduction when business growth is taken into consideration.

OUR MODEL FOR EFFICIENT RESOURCE USE

It is important we use valuable resources wisely. We design and manage our operations to eliminate waste wherever possible and then seek to reuse or recycle waste that can’t be avoided.

GOAL 11

REDUCEBEST Avoid waste in the first place eg.

design it out, order only what’s needed

Where we produce it, seek another use for it

Extend its usable life

Where it can’t be reused, maximise recycling rates

Dispose of via energy from waste

Waste to landfill as the last resortWORST

REUSE

REPAIR

RECYCLE

RECOVER

RESIDUAL

25% REDUCTION IN CONSTRUCTION WASTE

55,200 TONNES OF CONSTRUCTION WASTE AVOIDED

45% REDUCTION IN OFFICE WASTE

CONSTRUCTION WASTE (TONNES)

OFFICE WASTE (TONNES)

200,000

4000

250,000

2016 TARGET

2016 TARGET

5000

150,000

3000

100,000

2000

50,000

1000

0

0

2013

2013

2014

2014

2015

2015

2016

2016

REST OF WORLD UK

UK CONSTRUCTION WASTE DIVERTED FROM LANDFILL

TARGET ACHIEVED

We’ve looked at how we can reduce waste across all stages of the construction process. Controlled demolition enables us to extract reusable or recyclable materials, and we use demolition waste to create new foundations, minimising the need for additional raw materials. Buying only what we need, recycling the excess, or seeking alternative uses for left over products means less waste is produced. We’re also thinking about what goes into buildings, looking for opportunities to increase the efficiency of design and buy products with more recycled content. We have also delivered training and education to help our people more accurately classify waste to improve reporting.

This drive for greater efficiency has avoided over 55,000 tonnes of waste being produced and disposed of. In the future, we’re aiming to continue to improve how efficiently we use materials and enable alternatives to landfill in our Middle East operations by setting up our own Waste Transfer Station.

Managing our office waste We narrowly missed our target to reduce office waste by 50% with a 45% reduction overall through a combination of awareness campaigns, improved segregation and utilising best practice waste management techniques. We’re now looking at how we can minimise waste going to landfill through consultation with our waste managers.

OUR CHALLENGES Designing Out Waste workshops are effective when our

customers and sub-contractors are aligned and involved, but timing is key

Attitudes to waste as a resource vary and demand for more sustainable options is often low, we need to change perceptions of products with a high recycled content or reclaimed materials

Availability and maturity of waste infrastructure varies dramatically across our international operations

OUR SHOWCASE

Engaging with a wide range of external stakeholders including BITC, Aldersgate Group, Supply Chain Sustainability School, Constructing Excellence and Build UK to discuss closed loop systems and the circular economy

Working with an international contractor to establish our own material recovery facility to recycle plastic and cardboard from Middle East sites

In 2016 we expanded our relationship with the social enterprise ‘Community Wood Recycling Network’. The nationwide network of wood recycling social enterprises is now used on 23 sites to dispose of timber construction waste. This waste wood is separated into good quality wood to be repurposed into furniture, or low grade wood for woodchip. The social enterprise creates sustainable jobs, as well as training and volunteering opportunities for local people, especially those who might find it difficult to find employment. In 2016 we sent 318.5 tonnes of timber to social enterprises, a 28% increase on 2015, some of which were used to create shoe shelves for a major high street retailer!

Last year we presented at a number of Aldersgate Group events engaging the UK government and European parliament on the circular economy. We have emphasised the role of lifecycle management and importance of maintenance, to maximise the usable life of products, extending their life before secondary repurposing. Our CEO also sits on the leadership panel for Business in the Community’s Circular Economy Taskforce while we take an active role in the Technical Advisory panel.

LEADING DISCUSSIONS ON THE CIRCULAR ECONOMY

SUPPORTING LOCAL EMPLOYMENT WITH WASTE WOOD

Given that waste infrastructure is often less advanced outside the UK with fewer recycling options, our focus on producing less, being more efficient with our resources, and re-using waste where possible is even more important. For example, in our International Trade Training Schools we re-use construction waste in training exercises so materials experience a second life in educating and up-skilling our people.

REDUCE, REUSE, RECYCLE

Last year our Interserve Learning and Employment business invested in new printers with ‘follow-me’ printing. By monitoring peoples’ printing volumes we found that people are more thoughtful about their printing, and have seen 39% reductions in office paper waste.

PRINTER MONITOR MAKES PEOPLE THINK TWICE

FOLLOWING A 2015 TRIAL, OUR UMM SALAL EMPLOYEE VILLAGE IN QATAR NOW COMPOSTS FOOD WASTE USING A BIOBIN. THE COMPOST IS THEN USED TO GROW FRUITS AND VEGETABLES, WHILST OUR GREENHOUSES WERE ALSO BUILT USING RE-USED CONSTRUCTION WASTE!

OUR SUPPORT SERVICES BUSINESS HAS BEEN SENDING WASTE COOKING OIL FOR CONVERSION TO BIO-DIESEL SINCE 2013!

AT OUR NEW OFFICE INGENUITY HOUSE 98.7% OF THE DEMOLISHED ORIGINAL BUILDING IS STILL ON-SITE, CRUSHED UP AND USED AS SUB-BASE TO SUPPORT THE NEW BUILDING.

WHAT’S NEXT?


SUSTAINABLE GROWTH

WHAT DOES THIS MEAN?We are a force for good. We look to the future and are building a strong, ethical and successful business. We work with our supply chain to ensure responsible sourcing, supporting them to grow and make a positive contribution. We manage risks and value our impacts on society, skills and the environment.

OUTCOME 5

50m

Construction products

54% OF OUR CONSTRUCTION PRODUCTS AND SERVICES ARE SOURCED WITHIN 50 MILES OF OUR SITES

OVER 2600 MANAGERS HAVE SUSTAINABILITY TARGETS IN THEIR APPRAISALS

OUR UK OPERATIONS USE 74% RENEWABLE ENERGY


UK CONSTRUCTION MATERIALS RESPONSIBLY SOURCED

LOOKING FORWARD

Our updated plan continues our commitment to protecting and improving the natural environment, with a new action to ensure robust environmental plans are in place. We’ve expanded the scope of this to include adapting and responding to environmental change, alongside continuing the progress we’ve made on managing our own operations and sourcing products responsibly.

Our new goal to ‘Improve resource efficiency’ combines our existing goals on conserving water, reducing carbon emissions and making waste a thing of the past - putting efficient resource use at the heart of how we operate. Our targets are focused on using less energy, fuel and water, and producing less waste while delivering for our customers.

To better reflect how our volume of work impacts our overall performance, our future targets will be normalised by turnover. We will continue to refine this approach over the coming years.

Reducing carbon emissions continues to be a challenge for our generation. While we haven’t made the progress we’d like on reducing our emissions, we remain committed to this and continue to have an ambitious target to drive innovation and guide decisions.

Our 2020 target to halve our carbon emissions is proving the challenging target we thought it would. The majority of our emissions relate to our consumption of fuel through our vehicle fleet and energy generation on construction sites to power plant and equipment. We are somewhat reliant on the pace of change of technology to help achieve our targets. To date, this hasn’t brought the emissions reductions we’d hoped for. We remain committed to achieving emissions reductions but to reflect the challenge this represents, have extended our target out to 2025.

Our outstanding 2018 target to assess and act on our customers’ vulnerability to water scarcity is no longer considered a relevant target within our plan. Whilst being aware of water-related risks is important, our stakeholders did not consider this to be an area we can substantially influence.

We have already implemented our first closed loop systems in line with our 2018 and 2020 targets, and will continue to support the development of the circular economy thinking. Our commitment will continue through our roles on Business in the Community’s Circular Economy Task Force and the Aldersgate Group’s Circular Economy campaign.

POSITIVE ENVIRONMENTAL

IMPACT

PROTECT AND IMPROVE THE NATURAL ENVIRONMENT

90% OF OPERATIONSWITH ROBUST

ENVIRONMENTAL PLANS

REDUCE OUR CARBONEMISSIONS BY 60%

REDUCE USE OF RESOURCESAND WASTE BY 40%

IMPROVE RESOURCE EFFICIENCY

WE PROTECT THE NATURAL ENVIRONMENT AND IMPROVE NATURE WHERE WE CAN. WE USE RESOURCES CAREFULLY. AND RESPOND TO A CHANGING WORLD.

IN EVERYTHING WE DO, WE BALANCE ENVIRONMENTAL IMPACTS ALONGSIDE OTHER CONSIDERATIONS IN THE DECISIONS WE MAKE.


OUR GOALS




MAJOR ACHIEVEMENTS DEVELOPED A FRAMEWORK OF WORKING PRACTICES ALIGNED TO THE BRITISH STANDARD

FOR SUSTAINABLE PROCUREMENT (BS8903) FOR USE IN OUR MIDDLE EAST BUSINESSES HOSTED A SUPPLIER AWARDS EVENT TO RECOGNISE OUR SUPPLIERS’ CONTRIBUTIONS TO

ACHIEVING OUR AIMS OUR SUSTAINABLE PROCUREMENT WORKING GROUP REVIEWED ISSUES INCLUDING

EMBODIED CARBON, ETHICAL RISKS, AND TRACEABILITY OF PRODUCTS AND SERVICES TRIALLED ‘CEM-FREE’ CONCRETE ON OUR NEW REGIONAL OFFICE HUB, INGENUITY HOUSE,

WHICH HAS LESS EMBODIED CARBON THAN TRADITIONAL PRODUCTS

WHAT HAVE WE DONE?Managing our supply chainIn 2016 we focused on ensuring our supply chain management practices are able to deliver the requirements of our sustainable sourcing ambitions, and adopting a consistent approach worldwide. In our Support Services business we amended our Vendor Accreditation System to require all accredited suppliers to sign up to our new Code of Conduct which refers to ethical procurement, responsible sourcing and Modern Slavery. By the end of 2016, over 8,500 of the group’s suppliers were covered by our Code of Conduct or Ethical Procurement Policy.

In our international operations, our Sustainable Procurement Working Group produced a series of standard documents, procurement frameworks and policies to support sustainable procurement based on the British Standard for Sustainable Procurement BS8903. As part of this we created a standard for timber procurement to ensure that we buy sustainable timber. These frameworks are enabling our International businesses to leverage a common approach that is founded on best practice.

Knowing where products come fromWe’ve also made good progress on ensuring traceability, and our ability to measure and quantify the recycled content and embodied carbon in products we buy. We recognise that specifying and buying products with a high recycled content drives the market to innovate and provide alternative solutions to using virgin raw materials. We’re pleased that 74% of the materials we use have a responsible sourcing accreditation such as BES6001 - the Framework Standard for Responsible Sourcing or Environmental Product Declarations, meaning that organisations in our supply chain are managing their social and environmental impacts.

Taking responsibility for ethicsOur procurement teams work hard to ensure our procurement is both ethical and sustainable, and balance traditional assessments of price and quality with environmental, economic and social factors. During 2016 we further improved our ethical procurement standards, reflecting the requirements of the Modern Slavery Act and increasing the importance of worker welfare standards in our supply chain. This is in line with our commitments to protect the human rights of both people we directly employ, and of subcontractors and suppliers in our supply chain.

Identifying and managing social and environmental issues in our supply chain is important to us. We engage with our suppliers to fully understand the products and services we buy and seek the most sustainable option.

GOAL 12

REDUCTION IN THE EMBODIED CARBON CONTENT OF THE TOP 10 MATERIALS WE USE

KEY CONSTRUCTION

MATERIALS CONTAINED 44% RECYCLED CONTENT

50m

Construction products & services

54% OF OUR CONSTRUCTION PRODUCTS AND SERVICES ARE SOURCED WITHIN 50 MILES OF OUR SITES


19%

UK CONSTRUCTION MATERIALS RESPONSIBLY SOURCED

OUR CHALLENGES Different levels of supply chain maturity impact our ability

to engage with our partners at a technical level Our information on responsible sourcing is stored in varying

forms – to make better decisions we need to find ways to centralise and analyse data to make it more accessible

Balancing the need for strategic national partnerships and benefits of relationships with large suppliers, with our ambition to support local suppliers and smaller businesses

OUR SHOWCASE

Engaging with our top 20 suppliers to discuss key sustainability issues such as carbon, waste, supplier diversity, opportunities for disadvantaged groups, sustainable products and ethical supply

Moving towards 95% products and services responsibly sourced, with 80% key products traceable to source

Establishing our ‘forward thinking’ programme as a way to engage our key suppliers further on our sustainable supply chain journey

In the Middle East we are collaborating across seven of our businesses to combine purchasing power on commonly bought items. Through our new pre-qualification assessment we are able to identify local suppliers with the best sustainability credentials, and award longer contracts which enable us to build mutually better relationships based on trust, quality and performance. Through combining our spend, we have also been able to make savings which we are re-investing into better quality, longer-lasting products helping us reduce our environmental impact and improving the health, safety and wellbeing of our people.

USING BUYING POWER TO IMPROVE STANDARDS

We hosted a Supplier Award ceremony to recognise our suppliers’ hard work and contribution to our business. Recognising exceptional standards of service in our supply chain is an important part of us offering sustainability as standard. We want to work in partnership with our supply chain to reduce environmental impacts, achieve social benefits, increase skills and deliver great customer service. We are now seeking to build on our business with the winning suppliers to strengthen relationships, and find even better ways to work together.

RECOGNISING GREAT SERVICE IN OUR SUPPLY CHAIN

We’ve also been working to increase awareness and understanding of sustainability across our supply chain in the middle east. We held a number of supplier engagement days during the year in Qatar, Oman and the UAE to promote familiarity with our SustainAbilities plan, explaining our expectations and linking our aims and ambitions to the award of work. Through these days we were able to reach 80 suppliers, and are working one-to-one with a further 35 key suppliers to deepen our shared understanding of sustainability ambitions.

RAISING INTERNATIONAL AWARENESS OF SUSTAINABILITY

The embodied carbon in construction products is becoming increasingly important as improvements are made in the energy efficiency of new buildings. Last year we continued to measure the embodied carbon content of our top 10 purchased construction materials, including concrete, steel, glass and aluminium, and reviewed them against benchmarks for each product to identify suppliers with lower carbon alternatives. Where we can contribute to material specifications, this enables us to suggest products with a lower percentage of embodied carbon and provide price and carbon comparisons.

SOURCING LOWER CARBON ALTERNATIVES FOR KEY MATERIALS

IN 2016 WE USED 252,000 TONNES OF MATERIALS WITH AN EMBODIED CARBON CONTENT OF 32,300 TONNES, COMPARED TO A BENCHMARK OF 39,800 TONNES, REPRESENTING A 19% REDUCTION.

WHAT’S NEXT?


IMPROVE CLIENTS’ ENERGY SECURITYMAJOR ACHIEVEMENTS

SET UP AN ENERGY CENTRE OF EXCELLENCE TO PROMOTE BEST PRACTICE AND SHARE LEARNING AND EXPERIENCE ACROSS THE BUSINESS

IMPLEMENTED A NEW ENERGY DELIVERY MODEL TO OFFER A JOINED-UP APPROACH TO THE SERVICES WE DELIVER FOR OUR CUSTOMERS

IMPLEMENTED ENERGY-SAVING INITIATIVES AT OUR CONSTRUCTION SITES AS PART OF ‘INTELLIGENT’ SITE SET-UP, SUCH AS ECOKABINS, ZONED SECURITY LIGHTING AND HYBRID SOLAR-DIESEL GENERATORS

ACHIEVED CARBON EMISSIONS MEASUREMENT AND REDUCTION SCHEME (CEMARS) GOLD STANDARD FOR 5 YEARS CONSECUTIVE EMISSIONS REDUCTIONS IN OUR UK OPERATIONS

SUPPORTED OUR CUSTOMER TALK TALK TO ACHIEVE ISO 50001 ACCREDITATION

WHAT HAVE WE DONE?An integrated energy strategy This year we set up a new Energy ‘Centre of Excellence’. This enables us to leverage the knowledge and expertise within this dedicated and experienced team for the benefit of all our contracts. Its aim is to provide a comprehensive set of services in line with the strategic aims of Interserve and our customers, whilst enabling collaboration and sharing of best practice across the business.

Our new Energy Delivery Model supports our customers to generate, buy and use energy in the most efficient way for them. We use data and insight to design and implement the best solutions and we also apply these criteria to ourselves.

Make WellWe want to support local energy generation, and have conducted feasibility studies for off-grid renewable energy generation technologies to replace or add capacity to customers’ operations. During 2016 we have helped a large university to develop a carbon reduction programme to support their target to reduce carbon emissions by 45% by 2020 and make the university one of the most energy efficient in the UK. The plans include installing the largest solar photovoltaic (PV) array in any education establishment as part of the ‘Use Well’ and ‘Make Well’ measures. Interserve are also working with off-grid renewable partners to develop ‘private-wire’ PV solutions for our customers, fixing their energy costs, providing increased energy security and decarbonising their energy supply.

Buy wellBy centralising purchasing we have reduced legislative compliance costs by half with further operational efficiencies through a shared procurement delivery model. Our UK businesses now source 74% renewable energy and we offer low carbon energy procurement for our customers too.

Pay wellWe’re offering energy bureau services incorporating bill validation and payment services together with performance management through monitoring and targeting, measurement, and verification. Data collection and analysis is an important part of this approach, enabling us to identify savings, energy efficiency improvements and patterns in consumption to increase energy resilience.

Use Well As well as our services managing energy supply, we also design, install and commission mechanical and electrical building engineering services to enable demand-side energy reductions. Where opportunities to improve operational efficiency have been implemented, we’ve seen that better energy generation through innovations in low-carbon technologies can be key to reducing both carbon and costs, with carbon savings of over 28,000 tCO2 identified in our current pipeline.

As the cost of energy rises and more demand is put on supply, it’s important that we look to new ways to improve our own, and our customers’ energy security.

GOAL 13

74% RENEWABLE ENERGY

1 BILLION KWH OF ENERGY MANAGED ON BEHALF OF CUSTOMERS

WE OFFER LOW CARBON

ENERGY PROCUREMENT TO OUR CUSTOMERS

OVER THE LAST 5 YEARS OUR ENGINEERING SOLUTIONS HAVE REDUCED NHS TRUST’S ENERGY BILLS BY £600,000 PER YEAR

RENEWABLE ELECTRICITY ACROSS OUR OWN ESTATE

OUR UK OPERATIONS USE

WE GENERATED MWH

OUR CHALLENGES Trials of renewable energy generation on construction sites

have found that technologies don’t yet have the capacity to support more energy intensive activities

Investment in energy technology is often hampered by complex approvals processes that lead to long lead times

Short-term wins still prove more popular than decisions based on long term economic gains

OUR SHOWCASE

Next year our energy team will be working towards energy conservation measures for our customers in the order of £30m, with associated financial savings of £6m

Incorporating energy security and resilience into our overall target to ‘Improve resource efficiency’

Identifying opportunities to influence our customers to implement new and proven energy reduction strategies

Continued research and investment into new low-carbon technologies, including private-wire PV and battery storage

Cyprus receives two to three times more sunshine than the UK, and so is particularly suitable for solar energy projects which deliver a good payback, especially considering the higher cost of conventional energy. In Episkopi in Cyprus last year we installed a pilot solar photovoltaic (PV) array that enabled us to explore the potential benefits of variable array design, and design of earthquake and wind resistant systems. We also integrated solar panels into the roof of the new environmental centre at Akrotiri.

We developed a concept design for a containerised energy from waste facility for the Falkland Islands that tackles both the lack of available landfill space and stockpiles of scrap timber. Surveys showed that wood, cardboard and paper form a significant proportion of the waste stream (40%-60%) going to landfill, so our solution is to process timber and card into briquettes feeding a biomass boiler in a containerised Combined Heat and Power (CHP) system. Our integrated solution not only tackles the timber stockpile, reduces waste going to landfill and extends the lifespan of the landfill site significantly, but it also generates electricity, meets demand for heat and domestic hot water and electrical power, and helps make the most of limited space available.

As part of a rolling programme of works at County Hospital Stafford, Interserve Engineering Services are undertaking five ward refurbishments to bring them up to modern NHS standards. Energy conservation was a key part of the design objectives so we’ve designed and installed LED lighting to optimise energy efficiency and keep costs low. Across the five wards the upgraded lighting will provide an energy reduction of c141,000kWh per year, saving the Trust £11,000 and reducing their carbon emissions by 63 tCO2. We’ve also incorporated lighting controls, such as occupancy sensors for rooms not in constant use. Together, these provide an average reduction in energy usage and CO2 emissions of 56% compared to the original ward lighting.

AS SIMPLE AS FLICKING A SWITCH

We are now using solar warning lights on our international infrastructure projects to alert people where we are working. These are in addition to our solar security lights, which were previously run off diesel generators, and are now powered by the sun. We are also using a hybrid solar-diesel generator at our site in Buhasa which reduced employee village emissions by 36% in 2016, and we are exploring the use of a portable version for temporary works where grid connection is difficult to obtain.

USING THE POWER OF THE SUNPROVIDING SUSTAINABLE SOLUTIONS TO ISLAND ENERGY NEEDS

AN INTEGRATED SOLUTIONTO BOTH ENERGY AND WASTE

WHAT’S NEXT?


ADAPT AND RESPOND TO ENVIRONMENTAL CHANGE

MAJOR ACHIEVEMENTS GULF CONTRACTING RECEIVED A SPECIAL ACHIEVEMENT AWARD AT THE QATAR

GREEN BUILDING COUNCIL AWARDS FOR SIGNIFICANT CONTRIBUTION TO ADVANCING SUSTAINABILITY AGAINST THE QATAR NATIONAL VISION 2030

CONDUCTED A RESEARCH PROJECT TO ASSESS AND MANAGE WATER RISK IN OUR SUPPORT SERVICES SUPPLY CHAIN

SUPPORTED CUSTOMERS IN DISASTER RESPONSE EFFORTS FOLLOWING EXTREME WEATHER EVENTS

REVIEWED CUSTOMERS’ BUSINESS CONTINUITY PLANS TO ASSESS RISKS FROM EXTREME WEATHER AND DEVELOP RESPONSE PROCEDURES

WHAT HAVE WE DONE?Identifying key risksThe World Economic Forum Global Risk Report in 2016 lists water crises and failure of climate change mitigation and adaptation as two of the most likely and highest impact risks facing the world. The risks from climate change are considerable, to us, our customers and to our supply chain and we have an important contribution to make through all our businesses.

Building with climate change in mindIn construction, we have an opportunity to design and construct better buildings. At the extreme end of the scale we’ve designed and built structures to withstand typhoons and floods, but on a daily basis we design in measures that enable building users to manage thermal comfort, and specify materials with greater resilience to weather conditions such as temperature extremes. Our new office hub under construction in the Midlands has been designed to showcase the best of environmental design, using all the knowledge, experience and technology at our disposal. For our customers, we apply our knowledge to specify buildings and landscapes that are better able to cope with changing weather patterns.

Designing natural resilience We’re leading thinking on alternatives to hard-engineered environmental defences, using a combination of natural and engineered solutions. We want to promote the economic benefits and positive role of natural infrastructure such as reed beds, bog restoration and landscaping to build resilience, reduce the impact and manage the economic cost of environmental change. These solutions can provide multiple benefits, for example, external landscaping and tree planting provides opportunities for natural shading and minimise solar gain, whilst land management practices make the most of natural drainage to reduce flood risk, and more native plants support local ecology.

Managing the impact of temperature extremesClimate change is causing more Black Flag days in our International operations – these are when temperature and humidity rise so high that our work stops for the safety of our people. Our operations are planned around potential risks, and we monitor the situation closely. We have nurses on site that are trained to deal with heat-related illness, as well as cool rooms and cooling equipment such as icepacks and cooling cloths. We also engage with our operatives and supervisors on how to spot signs of dehydration, and we use a rehydration product during the summer months that is designed to replenish the minerals that we lose via sweat resulting in no heat-related illness in 2016.

Assessing risks in the supply chainAs well as our own operations, we need to consider how our supply chain is affected by climate events. During 2016 we commissioned a project to understand and quantify potential risks in our Support Services supply chain due to water scarcity.

Environmental change has implications for our own operations and those of our customers. We help ensure the buildings, spaces and infrastructure we build and manage are resilient and enable our customers around the world to adapt to climate change.

GOAL 14

OUR CHALLENGES Response is more common than prevention - preparing for

environmental change tends not to become a priority until a major incident has occurred

Perception of costs involved in environmental preparedness limits investment despite many mitigation techniques being low cost

Assessing supply chain risk requires detailed data on product origins which isn’t always readily available

OUR SHOWCASE

Incorporating environmental adaptation and resilience into our overall goal to ‘protect the natural environment’

Exploring the role of natural infrastructure alongside engineered solutions to minimise the impact of extreme weather events

Delivering a summit on the New Nature Economy to encourage ideas on climate resilience

In the UK last winter several of our customers suffered from major floods, and our teams did everything they could to minimise damage, protect people, and enable a speedy return to business as usual. Two of the responding teams were alerted to major floods over the Christmas period, and facing a limited supply chain, intermittent mains supply, and the increasing threat of rising water levels worked day and night to organise sand bags, isolate electrical supplies, move equipment to higher floors and assist with temporary relocation. We also supported the army providing assistance to people affected by floods, by providing a base for soldiers near the flooded town. Following these events, we have supported our customers to review their Business Continuity Plans in preparation for potential future events.

We’ve been exploring potential supply chain risks due to climate change such as water scarcity. The main products subject to water risk are those that depend on water use for manufacture, such as cleaning products, clothing, stationery and food for our catering businesses. Our research involved analysing our key categories of spend and engaging with our major suppliers on their management practices. We found that some supply partners were already using sophisticated water risk analysis tools, whilst others had not yet considered the issue. Whilst water shortages potentially pose high risks, our research found that risks are manageable through sourcing alternative products from regions at lower risk of water scarcity. In general, our supply chains are short enough to remain flexible, and we have few critical dependencies.

We achieved excellent scores from the Considerate Constructors Scheme for the regeneration of partly-derelict land beside Town Lock on the River Medway in Tonbridge, Kent. Densely surrounded by businesses and residential properties, our aim was to provide high-quality open space with a new flood wall, seating, lighting, landscape planting and toilet facilities for boaters using the River Medway, as well as a new building for the Environment Agency to house telemetry instruments, which capture and transmit data on rainfall, water levels and water flow data. We were commended for our reuse of excavated material and stone used to construct the new river bank protection units, with surplus donated for other flood defence works in the area. We also reclaimed timber from an old landing stage to construct the new landing platform.

ENHANCING FLOOD RESILIENCE

UNDERSTANDING WATER RISK IN OUR SUPPLY CHAIN

BUSINESS RESILIENCE IN THE FACE OF EXTREME WEATHER

IN THE PHILIPPINES WE SUPPORTED THE LOCAL COMMUNITY IN THE AFTERMATH OF THE 2016 CYCLONE WHICH CAUSED SEVERE FLOODING AND DAMAGE TO CROPS AND INFRASTRUCTURE.

THE ENVIRONMENT AGENCY’S FLOOD WARNING SYSTEM PROVED USEFUL DURING CONSTRUCTION AS TEMPORARY FLOOD DEFENCES HAD TO BE INSTALLED ON VARIOUS OCCASIONS

WHAT’S NEXT?


VALUE MORE THAN JUST MONEY

MAJOR ACHIEVEMENTS WE LAUNCHED A GUIDE TO SOCIAL VALUE TO HELP OUR PEOPLE THINK ABOUT DESIGNING

ADDED VALUE INTO OUR NEW AND EXISTING CONTRACTS PILOTED THE SOCIAL CAPITAL AND NATURAL CAPITAL PROTOCOL METHODOLOGIES TO

QUANTIFY OUR INTERACTIONS WITH SOCIETY AND ASSESS OUR DEPENDENCIES ON THE NATURAL ENVIRONMENT

SUSTAINABILITY IS REFLECTED IN THE REMUNERATION PACKAGE FOR OUR CHIEF EXECUTIVE OFFICER AND OUR CHIEF FINANCIAL OFFICER

RETAINED OUR LISTING ON THE FTSE4GOOD INDEX, RESPONDED TO THE CARBON DISCLOSURE PROJECT AND FOREST DISCLOSURE PROJECT

WHAT HAVE WE DONE?We look at all the ways that we create value through our activities. This includes generating social value in the communities where we live and work, recognising how we build the skills of individuals and share knowledge among teams and through collaborative working, and how we protect and improve the natural environment.

Generating social capitalOur contribution to society includes generating local employment, supporting the local economy through our supply chain and improving the lives of people we work with. We encourage our people to think about the way they can bring added value alongside day-to-day delivery, and recognising the amazing efforts of our people to go above and beyond to support local communities.

We have been working with the Cabinet Office and various UK Government commissioning bodies to bring about a better understanding and use of the Social Value Act to drive social benefits from their newly-procured contracts. This in turn has led us to be leading exponents of responsible procurement through the use of SME’s and social enterprises in our supply chain, to our participation in Business in the Community’s ‘Ban the Box’ campaign to encourage the employment of ex-offenders and Social Enterprise UK’s Buy Social Challenge.

Building knowledge capitalWe develop knowledge capital through training, educating and up-skilling our own workforce and people reached by our services. We are creating new ways and forums for our teams to communicate, discuss ideas and foster creativity, and we are encouraging partnership working with our customers and supply chain to deliver better solutions.

Enhancing natural capitalThrough our projects we look for ways to increase resource efficiency and conserve the natural environment including water, raw materials, energy and land. Our land management practices aim to make a net positive contribution to biodiversity and build long-term resilience to environmental change.

Sustainability is at the heart of how we do business. We believe long term business success is underpinned by a broader range of factors than just financial performance and we focus on three non-financial capitals - social, knowledge and natural capital.

GOAL 15

OUR CHALLENGES Short term wins are still proving more popular than

decisions based on long term whole life cycle cost We need to support commissioners to better factor social

value creation into the commissioning process We need to help customers recognise and understand the

hidden value of nature and ecosystem services on projects

OUR SHOWCASE

Interserve’s consulting business was commissioned by the Land Trust to undertake an ecosystem services and natural capital assessment on Silverdale Country Park. Silverdale Park, a former colliery, now consisting of woodland, grassland, lake and wetland is used by the community for a wide range of leisure activities. The assessment estimated the annual economic value of environmental services including carbon storage, water retention, purification and flood alleviation at Silverdale Park to be worth £2.6million; with the health and education benefits for the local population estimated to be worth £32 million over a 10-year period. This helps quantify the wider value that the green space brings to the local community in terms of environment, society and the wider economy. The Land Trust aims to use this understanding to aid better decision making in the management of the green space, and enable further investment to generate positive community benefits.

In 2016 we hosted our third Social Value Summit. Co-produced with Social Enterprise UK, and supported by Business in the Community, our annual event brings together leaders from across housing, healthcare, business, charity and social enterprise sectors to share practice, insight, and learning in relation to all things social value. The summit aims to share best practice, inspire ideas and innovation and build cross-sector networks and partnerships. The summit also hosted the Social Value Awards, established by the Cabinet Office and supported by KPMG, which recognised organisations that have put social value at the heart of what they do.

In 2016 we also piloted the Natural Capital Protocol in our Construction business. Natural capital is the store of renewable and non-renewable natural resources on which people and business depend. The Natural Capital Protocol provides a framework to map and understand relationships between business activities and these natural resources. Our study looked at the top materials used in construction, and applied the protocol to one of our projects – to identify risks and opportunities. Data was collected directly from suppliers providing insight into where products come from, their environmental impact and possible alternatives e.g. products with a greater recycled content. We don’t intend to put a monetary value on these inputs but to use the information gathered to help us make better buying decisions.

UNDERSTANDING OUR DEPENDENCY ON NATURAL CAPITAL

BRINGING PEOPLE TOGETHER TO PROGRESS IDEAS

In 2016 we commissioned a project to pilot the World Business Council for Sustainable Development’s ‘Social Capital Protocol’ on our business. This toolkit aims to encourage big business to measure and value its interactions with society in terms of employment, skills and safety. The research project looked at the demographic make-up of our workforce, the training and development pathways we make available, our charitable activities supported through the Interserve Employee Foundation, and our approach to safety. The final report made recommendations for us to continue developing and growing our programmes, using the Social Value Map as a tool to measure the impact of this work and incorporate social impacts into decision-making.

MEASURING THE SOCIAL VALUE WE BRING

VALUING NATURE FOR OUR CUSTOMERS

EVERY £1 INVESTED IN SILVERDALE COUNTRY PARK RETURNS £35 TO THE WIDER ECONOMY AND SOCIETY!

Understanding the financial value associated with non-financial performance indicators

Improving our set of non-financial performance indicators

Building tools to measure social value creation

Exploring ways to adopt a balanced scorecard to assess how our people perform against our multi-capital model

WHAT’S NEXT?


OUR PERFORMANCE

DIRECT LABOUR – % SPLITS BY GENDER % female 34% 35% 34% 24%

–% male 66% 65% 66% 76%

NUMBER OF OPPORTUNITIES PROVIDED FOR DISADVANTAGED GROUPS Double by 2016 836 243 181 –

% SUPPLIERS COVERED BY SUSTAINABILITY CODE OF CONDUCT 50% by 2016 52% 49% – –

WHAT WE TRACK TARGET PERFORMANCE HOW ARE WE DOING?

WHICH GOAL?

2016 2015 2014 2013

% SPEND WITH SMES – 65% 64% 61% – –

% CONSTRUCTION CONTRACTS LET WITHIN A 50MILES OF A SITE - 54% 51% 52% – –

Donations to charitable causes £1,240,000 £456,000 £430,000 £29,0001

–

Value in-kind donated £285,000 £132,000 £114,000 £88,0001

Value of employee volunteering time £832,000 £699,000 £422,000 £70,0001

Interserve leveraged fundraising £173,000 £345,000 £199,000 £52,0001

TOTAL COMMUNITY INVESTMENT – £2,530,000 £1,632,000 £1,165,000 £239,0001

% PRE-TAX PROFIT INVESTED IN COMMUNITIES 3% PBT by 2020 N/A 1.4% 1.1% 0.3%1

EMPLOYEE VOLUNTEER DAYS – 7400 3200 1917 3201

% EMPLOYEE VOLUNTEERING 15% by 2016 12% 5.0% 3.1% 0.6%1

% VOLUNTARY EMPLOYEE TURNOVER <10% by 2018 11.6% 12.8% 13.3% 8.6%

% EMPLOYEE ENGAGEMENT SCORE2 – 75% 68% – 64% –

ACCIDENT INCIDENT RATE(AIR) - Global per 100,000 workforce 138 by 2019 128 146 209 201

LOST TIME INCIDENTS (LTI) - Global per 100,000 workforce 306 by 2019 338 372 426 474

FATAL ACCIDENTS – DIRECT LABOUR AND SUBCONTRACTORS 0 3 0 1 3 –

% EMPLOYEES WORKING UNDER OHSAS 18001 CERTIFIED MANAGEMENT SYSTEMS

95% 97% 93% 95% 95%

% SITES SCORING OVER 40 ON CONSIDERATE CONSTRUCTORS SCHEME 75% by 2016 53% 44% 57% 25%

% OF OUR RECIPE OFFERINGS DEFINED AS HEALTHIER OPTIONS – 20% 20% 22% – –

TARGETMET

ONTRACK

PROGRESS MADE

TARGET MISSED

NO TARGET

The tables below provide an overview of our key performance metrics for the last four years.


PUBLIC SERVICE IN THE PUBLIC INTEREST

WHAT WE TRACK TARGET PERFORMANCE HOW ARE WE DOING?

WHAT NEXT?

2016 2015 2014 2013

NUMBER OF PEOPLE TRAINED IN SUSTAINABILITIES – 8,500 6,700 4,800 2,000 –

TRAINING DAYS –

UK 26,100 24,200 13,060 12,828

–ROW 75,068 107,729 39,049 -3

Total 101,168 131,929 52,109 12,282

WORK EXPERIENCE PLACEMENTS 1000 per year 2,941 2,178 1,076 –

NUMBER OF APPRENTICES, GRADUATES AND TRAINEES ON PROGRAMME 500 by 2018

601 477 320 250

NUMBER OF MANAGERS WITH SUSTAINABILITY TARGETS IN APPRAISALS - 2,632 1,835 762 - -

IDEAS GENERATED THROUGH INNOVATION PROGRAMME – 90 700 450 - –


LOOKING FORWARD

Our engagement on the future of the plan recognised the importance of our supply chain partners and sustainable procurement in underpinning our work. Supplier engagement becomes even more important, with a new 2025 action focused on engaging key suppliers in helping deliver our plan. While our new 2020 target will continue to drive progress on responsible sourcing, ensuring that our supply chain act ethically and we look for products with a lower embodied carbon and higher recycled content.

Our goals to ‘Respond to environmental change’ and ‘Improve clients’ energy security’ and related targets were no longer considered key issues requiring dedicated goals by our stakeholders. Environmental resilience will be addressed in our work under ‘Positive environmental impact’ whilst the advice we offer customers on energy use and other sustainability topics will be addressed through our goal to ‘Deliver outstanding service’.

We remain committed to our goal to ‘Value more than just money’. This includes tracking non-financial performance indicators alongside financial indicators and integrating consideration of social and environmental impacts into decision making. Going forward, our focus will be on developing tools to help measure this more effectively, to support our decisions and enable us to evidence progress in other areas of the plan.

SUSTAINABLE GROWTH


95% RESPONSIBLY SOURCED,80% KEY PRODUCTS TRACEABLE

TO SOURCEALL KEY SUPPLIERS

ACTIVELY PARTICIPATE IN OUR 'FORWARD THINKING'

PROGRAMMEBUILD INDUSTRY LEADING TOOLS

TO MEASURE SOCIAL VALUEVALUE MORE THAN

JUST MONEY

WE WANT TO BE A POSITIVE FORCE FOR GOOD. WE THINK ABOUT THE LONG TERM AND WORK WITH OUR PARTNERS TO CREATE A BETTER FUTURE.

OUR SUSTAINABILITIES PLAN IS DESIGNED TO ENSURE SUSTAINABILITY IS PART OF BUSINESS AS USUAL. WE ARE BUILDING A STRONG, ETHICAL AND SUCCESSFUL BUSINESS.


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OUR GOALS


Our 2018 targets on traceability and responsible sourcing will be updated with new 2020 actions to achieve 80% traceability and 95% responsibly sourced products and services – continuing our progress on sourcing certified products, increasing recycled content, reducing embodied carbon and focusing on the ethical conduct of our suppliers.

During our consultation process we identified that our targets on environmental resilience and co-designing energy security projects are no longer relevant. This is in part due to changes in our business activities and in part reflects improvements in our understanding of our influence, and our desire to focus our effort and resources where we can have the most impact. Rather than having a dedicated goal, adapting and responding to environmental change will be addressed as part of our goal to protect and improve the natural environment.

We have made significant progress on adopting the principles of Integrated Reporting into our annual report and accounts. For the last four years we’ve reported on our social, knowledge, natural and financial capital metrics across all our operations. Although we haven’t developed the balanced scorecard approach to decision making we originally envisaged, our updated 2020 action will continue to drive progress on developing tools that help us value and take account of non-financial impacts in our decisions.


GET INVOLVEDThis report covers the depth and range of activity across our business supporting the delivery of our SustainAbilities plan and shows how sustainability is embedded across business operations. This year, we have evolved our approach based on our learning and feedback from stakeholders, and will continue to develop this further over the coming years.

Whether you are an employee, supplier, customer or a member of the wider community we’d like to hear your feedback, suggestions and views. You are central to the outcomes we’re aiming to achieve and we want to work with you to take action. There are a range of ways you can get in touch:

WATCH USOur latest blogs, stories and video content are shared regularly on the SustainAbilities Hub.

sustainabilities.interserve.com/blog

JOIN USSustainAbilities is about working collaboratively to address challenges and find new solutions. We hope you’ll be involved and will engage with us on our journey.

[email protected]

TALK TO USAre you demonstrating best practice or do you have a suggestion for what we could do to achieve our goals? Your comments and feedback on what we’re doing are welcome.

[email protected] @irvsustainable www.linkedin.com/company/interserve

WHAT WE TRACK 2016 2015 2014 2013

TOTAL REVENUE Metric: £million £3,244.6 £3,204.6 £2,913.0 £2,192.6

HEADLINE PRE-TAX PROFIT Metric: £million £106.5 £115.4 £106.2 £81.1

PROFIT BEFORE TAX Metric: £million (£94.1) £79.5 £61.9 £68.1

HEADLINE EARNINGS PER SHARE Metric: pence per share 63.3p* 67.9p 58.8p 47.7p

FUTURE WORKLOAD Metric: % visibility over next 12 months’ revenue (market consensus)

70% 70% 74% 75%

GROSS OPERATING CASH CONVERSION Metric: % gross operating cash conversion

84.8% 41.3% 61.7% 89.5%

2016 2015 2014 2013

DIRECT LABOUR Including subsidiaries and Associates

UK 55,088 56,514 53,936 31,154

ROW 25,940 26,896 25,049 22,336

Total 81,028 83,410 78,985 53,490

TOTAL SUBCONTRACTORS /AGENCY WORKERS

UK 13,640 14,073 11,163 13,996

ROW 9,781 9,662 8,532 8,009

Total 23,421 23,735 19,695 22,005

TOTAL NUMBER OF FTEs (DIRECT LABOUR)

62,407 63,624 61,189 42,135

WHAT WE TRACK TARGET PERFORMANCE % CHANGEABSOLUTE

% CHANGE RELATIVE

HOW ARE WE DOING?

WHICH GOAL?

2016 2015 2014 2013

% CERTIFIED TIMBER PRODUCTS4

50% by 201680% 80% 80% - - -

% SPEND ON CERTIFIED FOREST PRODUCTS4 76% - - - - -

WATER CONSUMPTION Metric: 000s m3

20% reduction by 2016

UK 46.5 55.5 50.3 52.5# -11.4% -23.4%

ROW 1,646.1 1,662.1 1,741.6 1,542.9 +6.7% -29.6%

Total 1,692.6 1717.6 1791.9 1595.4 +6.1% -14.3%

TOTAL CARBON EMISSIONS Metric: 000s tonnes CO2e


UK* 54.1 59.1 65.2 61.3# -11.7% -23.7%

ROW 234.2 216.8 224.1 223.6 +4.7% -30.9%

Total 288.3 275.9 289.3 284.9 +1.2% -18.2%

Emissions from combustion of fuel (Scope 1 Carbon Emissions) Metric: tonnes CO2e

166.5 143.0 152.6 155.2 +7.3%

-Emissions from electricity, heat, steam and cooling purchased for own use (Scope 2 Carbon Emissions) Metric: tonnes CO2e

44.9 52.4 54.5 49.2 -8.7%

Emissions from distribution losses, business travel and (Scope 3 carbon emissions) Metric: tonnes CO2e

76.9 80.4 82.2 80.5 -4.5%

EMISSIONS FROM BUSINESS TRAVELMetric: 000s tonnes CO2e


UK 38.5 42.9 49.7 46.1# -16.5% -27.8%

ROW 87.1 78.1 89.0 86.0 +1.2% -33.2%

Total 125.6 121.0 138.7 132.1 -5.0% -23.2%

EMISSIONS FROM ENERGY USE ON PERMANENT SITES Metric: 000s tonnes CO2e


UK 6.9 7.3 8.7 8.5# -18.8% -29.8%

ROW 47.6 54.6 54.9 50.7 -6.1% -38.0%

Total 54.4 61.9 63.6 59.2 -7.9% -25.6%

TOTAL CONSTRUCTION WASTE

Metric: 000s tonnes25% reduction by 2016

UK 30.4 27.7 40.1 38.7 -21.4% -32.2%

ROW 136.1 147.4 165.2 183.5 -25.8% -51.1%

Total 166.6 175.1 205.3 222.2 -25.1% -39.5%

CONSTRUCTION WASTE BY DESTINATION (UK ONLY)% recycled/reused 92% 88% 86% 78% - -

-% landfill/energy to waste 8% 12% 14% 22% - -

OFFICE WASTE Metric: 000s tonnes


UK 0.8 1.0 1.2 1.3 -46.2% -53.4%

ROW5 1.9 1.8 3.9 3.6 -44.4% -63.3%

Total 2.7 2.8 5.1 4.9 -44.9% -55.5%

POSITIVE ENVIRONMENTAL IMPACT

SUSTAINABLE GROWTH

NOTES: Metric assessed by PwC in 2015 under their ‘Inspiring trust through Insight’ methodology and can be explored here: http://goo.gl/u2XMNq 1 Data collection was not fully implemented in 2013 2 Employee engagement index survey was conducted biannually until 2014 3 Data in 2013 did not include our international subsidiaries and associates4 Certified timber products in construction based on volumes; % spend on certified products in support services covers timber, palm oil and soy5 Office waste reduction reflects improvements in both management of waste and separation of accommodation/branch waste streams from office waste reporting * UK carbon emissions are independently assured under CEMARS ISO 14064-1 by Achilles # 2013 environmental data re-baselined to take into account the acquisition of Initial Facilities

* See Annual Report and Accounts for further information

TARGETMET

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REFLECTING ON OUR JOURNEY SO FAR - Interserve · Employee Foundation and volunteering programmes...

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