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"Spectris is committed to creating business growth whilst ensuring that impact on the environment is minimised and that all activities are conducted safely by well-trained and qualified employees."
The following review summarises the company's policies and procedures. Further information and examples can be found on the company's website at www.spectris.com.
Spectris comprises a number of subsidiary companies which operate around the world. Overall responsibility for developing corporate policies on social, ethical and environmental matters and for reviewing their effectiveness lies with the Spectris Board. It is then the responsibility of the individual operating units to communicate and apply that policy within their particular business taking account of local legislation and potential risks, to ensure compliance with the policy and to maintain, review and refine procedures accordingly.
Spectris policies and procedures, including those relating to social, environmental, health and safety, employment and ethical matters, are communicated to all business units via the Spectris Group Manual. As an integral part of the group's risk management and corporate governance processes, the presidents and finance directors of the operating companies are required to certify, on an annual basis, compliance with the group's policies and procedures and report on, where appropriate, all non-compliance events. All policies and procedures are reviewed regularly and any updates are communicated to the operating companies.
The Board confirms there is an ongoing process for identifying, evaluating and managing any significant risks, including those arising from social, ethical and environmental matters. This process forms part of the group's system of internal controls, described in the Directors' report, which are carried out within each operating business and reviewed regularly by the business group directors and the audit committee. Since 2003, the review of material environmental risk processes and procedures has been incorporated into the internal control and risk management function. Additionally, the executive directors report to the Board on any changes in the business and external environment which present significant risk, whilst regular reports on legal exposure and insurance matters are received from the company secretary.
Spectris has been a member of the FTSE4Good UK index of socially responsible companies since its establishment in July 2001.
The three key areas of corporate social responsibility at Spectris comprise environment, health and safety, and employment and ethics.
Spectris is addressing concerns for the environment by designing products which provide customers with the ability to minimise their impact on the environment by reducing raw material consumption, waste and energy use or minimising harmful emissions.
The productivity benefits to a wide range of industrial processes are both direct and indirect in saving natural resources. Some current examples where the use of our products has a direct beneficial contribution are shown on the company's website.
Spectris products do not require capital-intensive manufacturing processes and hence their manufacture generally has a low overall environmental impact. Nevertheless, Spectris is committed to adopting environmentally responsible policies in its internal operations wherever its companies operate.
The environmental policy is designed to achieve the following objectives:
Environmental management systems Operating companies representing over one-third of Spectris business by turnover are certified to ISO14001, the international environmental standard, with other companies working towards accreditation.
Risk assessment Identification of significant risk to the business comprises the determination of potential effects on the environment resulting both from product manufacture and operation of the product at the customer's site. The scale and severity of the possible impact is assessed, together with the probability of its occurrence. Where a significant risk is identified, procedures for storage, normal operating conditions and emergency situations are documented and regularly monitored for compliance with the relevant regulations. A nominated individual is responsible for safety compliance and all employees are informed and trained in safety procedures, depending upon the extent of their involvement with the product presenting the risk. Documented processes are in place to reduce the likelihood of an occurrence. Material environmental risk processes and procedures are reviewed by the group internal control and risk manager.
Examples of significant potential risk in Spectris operations include, within the PANalytical business which supplies instrumentation for X-ray analysis, the limited use of beryllium in detector windows and X-ray tubes. Some NDC Infrared Engineering products utilise low-level sealed radioactive sources. In both cases, the legal requirements for the correct handling and labelling of products and hazardous areas are documented and regularly audited for compliance. Procedures also exist for the disposal of contaminated waste and, where appropriate, for recovering used products from customers and disposing of them safely.
Servomex supplies gas analysis instrumentation and its testing facility includes the storage of flammable and toxic gases. Operating procedures for the movement and use of cylinders containing such gases are in accordance with the appropriate legal requirements and are inspected annually by an independent authority. Chemical and hazardous waste is disposed of in accordance with written procedures.
During the year no significant environmental incidents were recorded. Investigative studies into contaminated land at Almelo in the Netherlands, resulting from activities prior to ownership by PANalytical, have now been completed. These demonstrate that the contamination does not present a risk to groundwater and recommend that the contamination be permitted to degrade over time through natural processes. The company is awaiting approval from the Dutch authorities for this course of action and the ongoing monitoring regime.
Compliance with future legislation Spectris products will shortly be required to conform to two new EU Directives:Waste Electrical and Electronic Equipment (WEEE) and Restriction Of Hazardous Substances in Electrical and Electronic Equipment (ROHS). WEEE aims to reduce the waste arising from electrical and electronic equipment and improve the environmental performance of all the components involved in the life cycle of electrical and electronic products. ROHS aims to protect human health and the environment by restricting the use of certain hazardous substances in new equipment. The principal impact of the Regulations on Spectris businesses is to require the replacement of lead-based solder used in the manufacture of printed circuit boards (which is largely carried out by third party suppliers) with lead-free solder. All affected Spectris businesses are working to ensure that both they and their suppliers comply with the Regulations in a timely manner.
Waste minimisation Environmental awareness is the responsibility of all employees and internal initiatives are in place at many sites to reduce energy usage and minimise wastage. These include recycling of waste paper, cardboard, plastic cups, aluminium cans and mobile phones, reducing energy consumption through the use of timers and sensors to control hot water, air conditioning and lighting, reducing water consumption and re-use of packaging and filling materials. Spectris complies with the UK Producer Responsibility Obligations (Packaging Waste) Regulations which set targets for the recovery and recycling of packaging waste.
Spectris recognises its health and safety duties and responsibilities and requires that all companies comply with the relevant health and safety legislation. The Chief Executive has overall responsibility for health and safety.
All operations (and where appropriate, each location) are required to issue and bring to the notice of their employees a written statement of policy with respect to health and safety at work. Audits of health and safety policies and procedures are undertaken at all major locations by external assessors acting on behalf of the group's insurers on a periodic basis.
During the year no significant health and safety incidents were recorded.
Spectris operates mainly in Europe and the US, but with a growing presence in the Asia Pacific region. Inevitably, different social and employment conditions exist in different locations, but Spectris places high priority on compliance with legislative and ethical requirements within all jurisdictions in which business is conducted, particularly with respect to employment practices, labour rights and equal opportunities. The head of commercial has overall responsibility for human rights, employment and ethics, but responsibility for implementing the policy is delegated to individual business units, with operational policies tailored to suit local needs.
Human rights Spectris believes in the fundamental rights of people in all parts of the world and is committed to adopting internationally recognised human rights standards wherever it operates. The company's human rights policy is consistent with the Principles of Human Rights, as set out in the International Labour Organization's core conventions.
It is the group's policy that all operating companies:
The group monitors compliance with the policy through various processes, including confirmation in writing by each business unit annually, and consolidated Equal Employment Opportunities Commission returns which are produced in the US. The policy is regularly reviewed and any changes are communicated to the operating companies via updates to the Group Manual.
The group recognises the value of consultation with employees and Works Councils represent employees in applicable jurisdictions.
Employment and ethics All employees are expected to behave with integrity and honesty and adhere to the code of ethics.
Spectris operates a confidential "whistleblowing" policy via which employees may report to the business's management team or any Board member any concerns they may have over unethical business practices or conduct, dangers to health and safety, or breach of company policies. Any such disclosures are appropriately investigated. In addition, Spectris is committed to protecting the career and reputation of employees who report wrongdoing in accordance with established procedures, as long as their disclosures are delivered in good faith and seek to safeguard the best interests of the group.
Training and development Spectris recognises the value that its employees create for the business and its commitment to training and personal development, together with remuneration policies which are designed to reward achievement, emphasises the importance of retaining staff throughout the group. Local policies, based on overall group guidelines, are set by individual managements according to the needs of their business and local conditions.
Employee communications The company has a policy of encouraging its operating companies to provide information to their employees on a regular basis. This information includes matters relating to their company's performance, its prospects in the markets it serves and the future outlook of its business. In addition, the group distributes a quarterly electronic newsletter, Perspectives, which keeps employees abreast of group progress (and is also available to shareholders at www.spectris.com). Financial participation in the group is encouraged through the Savings Related Share Option Scheme in the UK and the group's executive share option schemes.
Community involvement Spectris operating companies worldwide support local charities and participate in a range of community activities. Charitable donations in 2004 totalled £35,000, of which £8,000 were in the UK (2003: £137,000, of which £8,000 in UK). Examples of community activities are described on our website.