Stakeholder engagement
The Board takes responsibility for considering stakeholder needs and interests in its decision-making.
The Board shapes the framework within which stakeholder relationships are developed and maintained, and the purpose of stakeholder engagement in relation to decision making and strategy. The Board itself has a robust programme of stakeholder engagement, aimed at identifying and understanding the interests of the Group’s customers, workforce, supply chain and strategic partners, communities, governments and investors so that the interests of these key stakeholders can be taken into consideration when decisions need to be taken. The Board however cannot, on its own, ensure meaningful reflection of all stakeholder views across the Group. In addition to the Board’s programme of stakeholder engagement, there is also a network of mature executive and business-led stakeholder relationships across the Group which complements actions taken by the Board. Where appropriate, feedback is reported to the Board to support the timely recognition of emerging stakeholder issues. There are many different ways in which the Group engages with its key stakeholders, as set out on pages 116 to 121 of the 2022 Annual Report and Accounts. Specific Board engagement with the Group’s workforce and shareholders is set out below.
Workforce
The Board understands that the Group’s workforce is the business's most valuable resource and is pivotal to building its long-term sustainable success. In order to ensure we are an employer of choice, we are operating effectively, and creating a working environment where all employees feel safe and valued, and are given the tools to succeed and develop throughout their Balfour Beatty careers, the Board must listen and engage meaningfully with its employees.
In 2022, the Board undertook an effectiveness review of existing Board-led workforce engagement mechanisms.
Following the effectiveness review, the Board appointed a designated non-executive Director as Workforce Engagement Lead (Louise Hardy), tasked with shaping the workforce engagement strategy for the Group and for reporting to the Board on the outcomes and insights of engagement activities.
The Board prioritises engagement with the breadth of the employee population through its Stakeholder Voice initiative. Stakeholder Voice is supported by reports on key performance indicators, including an ‘engagement index’ figure (as measured by employee surveys), voluntary attrition rates, safety observations and participation rates for the My Contribution, Balfour Beatty’s employee-led change programme, where employees are encouraged to propose and develop innovative ideas to drive improvements in the Group’s operations. In addition to the Stakeholder Voice initiative, non-executive Directors are kept abreast of engagement opportunities throughout the year, for example through training workshops, talent activities, site visits, town halls, contract award meetings and more. Care is taken to ensure each non-executive Director has a broad exposure across the workforce and areas of the business.
Board members are required to report on their findings and insights derived from site visits and engagement activities. Whilst undertaking engagement activities, they are encouraged to discuss and gather feedback on topics such as:
- health and safety,
- environment and sustainability,
- diversity and inclusion,
- leadership and engagement,
- culture and morale,
- resources and personal development,
- understanding of Group strategy, values and behaviours; and
- director remuneration, and its alignment with workforce remuneration.
Investors
Investors play a valuable role in the corporate governance of the Company. The Board is committed to maintaining an open dialogue with its investors, which is achieved through a programme of structured engagement. A selection of investor events that took place in the year can be found within the investor calendar on page 121 of the 2022 Annual Report and Accounts. A similar programme is anticipated to be followed in 2023.
Institutional investors
The Group Chair, Group Chief Executive, and Chief Financial Officer held meetings with individual institutional investors throughout 2022. The executive Directors conducted analyst presentations following the announcement of the Group’s financial results.
Either where requested by investors or on specific occasions, Committee Chairs will engage on matters specific to the remit of their respective committees. The Senior Independent Director is also available to shareholders as a separate channel to report any other views or concerns. In addition, management engages with proxy advisory firms to support them in their reporting to their members.
The Board receives biannual reports from the Head of Investor Relations summarising analyst research briefings and changes to institutional shareholdings, as well as ad hoc reports on share price movements.
Retail investors
The Company’s website provides access to full year and half year results information in addition to a plethora of information on the Company including in relation to the operations of the Group, governance, health and safety, and sustainability so that retail investors can keep equally as informed as institutional investors. Retail investors are also encouraged to raise any questions or queries they may have with the Company Secretary, who will arrange for an appropriate response to be provided.
Annual General Meeting (AGM)
The AGM provides an opportunity for investors to engage directly with the Board in person. Following a closed meeting in 2021 due to COVID-19 restrictions, the Board was delighted to welcome back investors to a physical in-person AGM in 2022, providing shareholders with the opportunity to ask questions and engage with the Board directly.