Sustainability report 2009

The stakeholder panel welcomes the opportunity to provide feedback on Balfour Beatty’s sustainability strategy and reporting practices. We commend the Company’s serious commitment to sustainability and its level of transparency.

The panel feels that the Balfour Beatty sustainability vision and roadmap (which includes 2020 aspirations and plans for implementation), are first-class. Real effort has been made to roll out the vision and roadmap in the short period following its launch in 2009. We look forward to an update next year on how far this roll out has progressed throughout the organisation as a whole.

The sustainability roadmap sets minimum expectations and measures of excellence for 2012. We recommend that the Company reports on progress towards these targets, and against non-financial key performance indicators, in its annual sustainability report. In 2011, the panel would hope to see the results of the current and previous year, as well as new targets for the next reporting year.

The panel believes that Balfour Beatty is well placed to create a sustainable and responsible chain of custody that goes beyond its own procurement and upstream supply chain activities. The Company also has a significant downstream impact on the sustainability performance of its customers and clients. Continuing to influence the market in this area can only enhance the Company’s competitive advantage.

Delivering sustainability is clearly important to Balfour Beatty and the leadership and commitment behind this is apparent. However the panel would like to see further evidence of how the vision is being embedded within the Company’s culture from top to bottom. We would like to see more evidence of engagement and capacity building, in particular across the Company’s senior business leaders. We also believe that further opportunities exist to integrate sustainability into job descriptions, personal accountabilities, objectives and remuneration. Finally, we would encourage the development of a feedback mechanism to help monitor progress on employee understanding of sustainability and implementation of the roadmap and vision.

We encourage Balfour Beatty to continue to seek stakeholder opinion in the future. We would welcome wider representation on the panel to reflect the company’s global operations and we believe there is scope to open feedback to appropriate international NGOs and relevant interest groups.

We were delighted with the level of engagement and interest shown in our sustainability report by the stakeholder panel this year. Their insight and challenge helped us to improve the content of this year’s report.

The recognition from the panel that that we have developed a first-class strategy for sustainability reflects the hard work of many people and our ambition to be an industry leader. We are now moving into the next phase with our operating companies translating this strategy into their action plans. Key to the successful delivery of our 2020 vision and roadmap will be embedding sustainability into everything we do. We are pleased that the panel has also identified this as a critical area for success.

Going forward, Balfour Beatty will continue to report on a range of non-financial performance measures, including progress against the 2012 commitments in our roadmap and how we will engage our people at all levels on sustainability. We are already taking steps to encourage employee feedback with the design of our e-learning and offline sustainability training course, which we expect to launch later this year across our global operations. Integrating sustainability into work winning and supply chain management will also be priorities for our programme in 2010/11.

Building on the success of this year’s panel, we will explore opportunities to extend its membership to include appropriate stakeholder organisations outside of the UK. This development would help bring further alignment with the growing international dimension of our business.

We look forward to further engagement with the panel next year as an important part of our sustainability journey.

Balfour Beatty, May 2010

We gained real value from engaging our stakeholder panel last year. Progress against their recommendations in last year’s opinion statement is summarised here with links to relevant sections of our online report for further information.

Following the success of our first stakeholder panel last year, we asked an expanded panel of key stakeholders to give us an independent opinion of our 2009 sustainability report and our approach to sustainability. Seven experienced sustainability and corporate responsibility practitioners met in March and again in April 2010 to review our report.

The panel members were:

• Dean Kerwick-Chrisp, Sustainable Development and Climate Change, Highways Agency and panel chair
• Ian Gearing, Head of Corporate Responsibility, National Grid
• Kate Broome, Corporate Responsibility Executive, Network Rail
• Dave Farebrother, Environment Director, Land Securities
• Tim Goodman, Manager, Hermes
• Chad Harrell, Director Operations & Sustainable Business Development, UK Green Building Council
• Andy Spencer, Sustainability Director, Cemex.

The terms of reference for the panel can be downloaded here

The views of the 2009 Panel are reproduced, without amendment from Balfour Beatty together with our response.

Our approach to assurance follows the key elements of the revised AA1000 Assurance Standard (inclusive, reflects material issues and is responsive to stakeholder concerns).

To help inform the Stakeholder Panel, we commissioned URS Corporation Limited to conduct a review of our sustainability programme and performance data, including how sustainability is embedded and managed across the company.

Key elements of this review comprised:

• interviews with eleven senior managers at Group-level and a selection of employees at operating company and project sites to assess how sustainability is embedded and managed
• one day data reviews at two project sites (Blackfriars station in London and Salford Hospital in Manchester), Balfour Beatty Construction Northern, Balfour Beatty Workplace and Balfour Beatty Major Civil Engineering operating companies and at Group Head Office to review the collection, collation and management of data at each level of the Company; and,
• a thorough review of the draft Sustainability Report, assessing qualitative and quantitative claims included for accuracy and reviewing further evidence provided by Balfour Beatty in support of these statements where required

The members of the URS project team have not been involved in the development of the report or associated sustainability programmes, data and information collection systems. This ensures that the URS project team is well-placed to provide an independent review of our sustainability programme and performance data to the panel.

We believe that this approach to assurance is still unique for our sector. If you would like to share your views on our report with us, please go to Comments and feedback