Eurovia CSR Booklet

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Our structure

FIT FOR PURPOSE: We have restructured our Group to promote our two core business streams – the Term Services provided by Ringway, and our Contracting & Production activities now trading under the Eurovia brand name.

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Contents CR Report 2010

Foreword 2010 brought many challenges, but in spite of the difficult conditions in our markets, which are ongoing, it was a year of many achievements too.

As this report outlines, our approach to corporate responsibility and our strategy for the business are ever more closely entwined. That is borne out by our achievement of Silver status in the CR Index, in just our second year of entry, benchmarked against the leading organisations in the UK.

1 Our business Section 2 Our strategy Section 3 Our customers Section 4 Our people Section 5 Our environment Section 6 Our communities Section 7 Our performance

4 Section 8 12 16 22 28 32

Despite the economic downturn, we sustained a high level of investment in training, in our apprentice and graduate recruitment programmes, and in research and development. We pushed the proportion of waste diverted from landfill to over 92%. Assessments against the EFQM business excellence model showed further evidence of continuous improvement.

These efforts brought recognition with awards for quality, occupational safety, partnership with clients, and product innovation.

We recognise, though, that we cannot afford to be complacent. Our carbon strategy, launched during the year, maps out the steps we must take to monitor robustly all aspects of our footprint as we strive to reduce carbon in our business. But it will be a hard path, as the severe winter season showed in its impact on our fuel and energy use. Nor do we under-estimate the challenge of replacing traditional solutions with our more sustainable and low-energy alternatives.

So we have restructured our Group in two distinct operating areas under the Eurovia banner of our parent company. The name signifies our access to world-leading technical expertise and financial resources. It also befits the Contracting and Production side of our business, which has an expanding private client base as well as public sector customers. Our Term Services business, meanwhile, sustains the market-leading reputation of the Ringway brand.

We are a leaner and fitter Group with a solid commercial base, sound finances, and a highly skilled and talented team delivering an increasing range of services to our clients. This gives me confidence that we can live up to our corporate responsibilities and deliver for our stakeholders through the years ahead.

Scott Wardrop, Eurovia Group Managing Director

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CR Report 2010

Our business Against the backdrop of continuing recession and uncertainty, 2010 was a challenging year for Eurovia Group.

In most of our markets our business was squeezed – on the one hand, by falling demand or prices for our products and services, and on the other, by the rising costs of energy and materials. But these challenging conditions have also given rise to opportunities that we are pursuing to adapt our business in ways that promote sustainability and fulfill our corporate responsibilities.

Marketplace trends Competition intensified during the year as service providers braced themselves for public expenditure cuts following the Government’s comprehensive spending review. Local authorities are not only cutting their budgets, they are also changing the basis for letting contracts. Giving price more weight in tender evaluations reverses the trend of recent years towards a higher emphasis on quality. It also increases the risk that bidders undercut costs to retain or win contracts.

Another shift, towards longer contract periods – eg, 7-10 years rather than five with possible extensions – will reduce the frequency and number of tender opportunities. But it is welcome in so far as it fits with our philosophy of seeking sustainable returns through longer-term partnerships and concessions.

More and more of our clients are seeking our support and expertise in managing their networks and assets. Our Group is delivering these functions while continuing to build our skills and knowledge in the field of network management and long-term asset optimisation.

“Corporate responsibility underpins many aspects of my job – from how we apply our business ethics and values in our dealings with clients, to driving carbon reduction through performance assessment. The way we engage with local communities is also highly important and rewarding. In Islington, for example, we have hosted events to educate schoolchildren about the dangers of carrying knives and we are sponsoring opportunities for people from deprived areas to attend the 2012 Olympics.”

Jackie Wellesley, Liaison & Performance Manager, Eurovia Infrastructure Limited

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A fitter structure In response to these changing market conditions we have adapted our Group structure and taken a strategic approach to tendering. Our business strategy, in which corporate responsibility is embedded, involves consolidating our strong position in core markets while diversifying into areas with growth potential – especially low-carbon alternative technologies and services (see Our strategy, page 9).

We began 2010 with a new Group structure that better reflects our two main business streams – Term Services and Contracting & Production – now delivered under the separate flags of Ringway and Eurovia. We also strengthened our management team, appointing highly experienced people to lead these two sides of the business.

Contracting & Production covers a wide range of specialist services as well as surfacing, roadmarking and installation activities, plus the manufacture of asphalt, other highway materials and signing. More than half of this business was already with external customers.

Adopting the Eurovia brand widens this appeal further, while signalling our division’s access to the world-leading technical expertise of our parent company, Eurovia SA. The Ringway name remains synonymous with infrastructure and environment services. Clients and competitors alike recognise our strengths as a services provider. Term Services will continue to gain great advantage from the values Ringway represents (see overleaf) and our reputation for delivery and innovation.

Meanwhile, for our business as a whole, the Eurovia name underscores the financial strength and stability of the Group. In an uncertain economic climate, clients can have confidence in our commitment to service and partnership over the longer term.

47,000 hours of training delivered in 2010

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CR Report 2010 Other developments Making our Group fit for purpose means tackling its cost base too. Rising prices for resources, and particularly oil and bitumen, have posed significant risks for businesses in our sector over the last two years. This was most acute in asphalt production, which has also been hit by the hike in energy costs and overcapacity.

OUR VALUES Our vision is to be the preferred service provider within our chosen market sectors. Living our values every day guides our behaviour, sets us apart from competitors, and helps us strengthen our relationships with customers and attract new ones.

• INTEGRITY – We are straightforward and fair. We do what we say we will do, respect and trust people, and are trustworthy in return.

• VERSATILITY – We embrace change, welcome new situations and crave knowledge from whatever source. We are flexible and adaptable to new methods and practices.

• OPENNESS – We are approachable. We know that clear communication and involvement at all levels within the Group, and with our supply chain partners and our clients, is vital to sustain long-term success.

• RESILIENCE – We are persistent, set challenging goals for our performance, and strive to build enduring relationships. We see difficulties as opportunities to learn.

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Following the severe downturn in this market, we took the difficult decision to close down our Roadstone division’s plant in Immingham. This was dictated by sharply rising costs and falling output, despite strong relationships with clients in the region and a committed workforce.

The facility’s equipment will be dismantled and re-used by our parent company Eurovia SA elsewhere in Europe.

We have plans to invest in other areas, including plant and personnel. Eurovia Roadstone continues to explore energysaving opportunities. In Dagenham, for example, we are promoting best practice in managing carbon emissions through training sessions for operational and technical management provided by the Carbon Trust.

We and our shareholders are also prepared to invest in acquisitions that strengthen our business. Early in 2010 we acquired Highway Infrastructure Services and its signs installation operations, which complement our Eurosigns manufacturing business. The HIS acquisition also supports our commitment to ‘self-deliver’ services where this represents the most costeffective solution (see Our Customers, page 12). The same formula – acquisition and self-delivery – saw the continued growth during the year of our Airport Services division following its expansion in 2009.

Despite the uncertainty gripping our markets, we ended 2010 in a strong commercial position: debt-free, cashpositive and budgeting for strong performance across the business. Our order book was bolstered by the extension of five term contracts as we enter the final phase of bidding for two long-term concessions under the Private Finance Initiative – in partnership with our sister company, VINCI Concessions.

Eurovia and VINCI As our new Group title proclaims, we are part of Eurovia, the European leader in transport and urban development infrastructure, which employs more than 40,000 people generating annual revenues of around €8 billion.

And through our parent company, we are part of VINCI, the largest construction and road services group in the world.

VINCI employs 180,000 people in more than 100 countries, turning over €33 billion.

VINCI is renowned for its commitment to sustainable development and sets the framework for our policies. Its approach to corporate governance is based on risk management and accountability. VINCI’s Sustainable Development Committee analyses the risks associated with all the Group’s activities. It also oversees regular environmental and social reviews, and holds subsidiaries to account for progress

towards VINCI’s ‘priority commitments’. These range from health and safety goals to measurement and management of greenhouse gas emissions. We in the UK report our performance via Eurovia, including our Scope 1 and 2 carbon emissions.

Governance and CR The drive to embed corporate responsibility in all our activities stems from board level. This body sets our corporate responsibility strategy (which is outlined in the following chapter) and tasks individual directors and senior managers with leading on specific aspects.

The Group Executive Committee, which is chaired by the Group Managing Director, oversees how the strategy is implemented. Corporate responsibility is translated into policy and practice through a variety of groups and channels, including the Health, Safety & Environmental Steering Committee, People Strategy Group, Supply Chain Executive, Low Carbon Steering Committee, and Community Committee.

The Way We Work The Way We Work is our integrated system for managing health and safety,

environmental performance, and quality. It combines the management framework set by our parent company and our own policies and procedures in one user-friendly tool for all operations.

These procedures range from routine operational matters to emergency plans and disaster recovery.

Our integrated management system is accredited to the international standards for quality, environmental performance and safety (ISO 9001, ISO 14001 and OHSAS 18001). External assessors audit the system, which was revamped, under the guidance of its users, in 2009. The renewal continued in 2010 as many areas were updated, anchoring its procedures more firmly in day-to-day working.

Through 2010 there was also a change in the process as we moved the basis of ISO registrations from our divisions to Group-wide certification.

This is driving greater consistency across the Group, highlighting innovations and areas for improvement. It also helps target internal auditing where it is most needed.

The benefits are being reinforced further as we integrate compliance audits with assessments against the EFQM Business Excellence model (see Our strategy, page 9).

CASE STUDY

All out for ANITA

The ANITA project at Birmingham Philip Hammond opening International posed major the ANITA scheme challenges, not least the breadth of skills and resources that had to be deployed while serving multiple stakeholders from rail station managers to the Highways Agency and the National Exhibition Centre (NEC).

Ringway Infrastructure Services secured this £11 million commission under its Strategic Highways Contract with Solihull Borough Council. Funded by the Department for Transport, the scheme (officially opened

by Transport Secretary Philip Hammond in May 2011) involved widening and resurfacing a dual carriageway, installing the country’s first variable bus lane, constructing a new link road to Birmingham International Airport, and other works, including cycleways and bus corridor improvements.

Through Early Contractor Involvement, Ringway seconded a Graduate Engineer to consultants WSP as Design Co-ordinator, engineering valuable savings. The Group’s Technical Centre undertook the detailed design of carriageway construction, as other divisions made and laid Eurovia’s U-LM thin surfacing, and recycled planings in the footway and cycleway sub-base layers. Other in-house contributions included the temporary traffic management arrangements, resin-bonded surfacing for cycleways, white lining, road studs and anti-skid treatments, variable-message, rotating-prism and static road signs, covered cycle stands, and safety barriers.

This comprehensive capability delivered a complete and cost-effective solution, exploiting advantages in programming, consistent safety culture, internal pricing, and specialist products and expertise.

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CR Report 2010

Our strategy Just as we refocused our strategy for the business during 2010, we also developed and refined our roadmap for corporate responsibility. The most notable aspect of this ongoing process is the extent to which both strategies are now aligned.

As we have previously reported, the Group’s Five Year Plan recognised that corporate responsibility was fundamental to the long-term sustainable growth of the business.

Doing the right thing by people and the planet is the right thing for the business too.

There is no trade-off. This reality is borne out by three crucial strands of our business strategy – for winning work, streamlining the business, and seizing growth opportunities.

Strategic tendering We want to build long-term relationships with clients who are flexible and open like us.

This allows us greater scope to innovate and add value in ways that benefit both sides and our stakeholders, not least the communities we serve.

So we are tendering for strategic contracts that deliver value and support the objectives of our Five Year Plan while ensuring our service philosophy is closely aligned with the needs of customers.

We are also investing heavily in Private Finance Initiative bids. Under PFI contracts we can deliver significant infrastructure investment by leveraging the financial strength of VINCI. Their typical 25-year term encourages decision-making on the basis of the wholelife costs of developing and maintaining assets – including their carbon footprint.

Our Group is also a firm believer in Public Private Partnership. Through PPPs we can accelerate the renewal of our customers’ assets, again by exploiting the wider resources of our parent and associate companies.

Streamlining Our business and CR strategies converge also when it comes to streamlining the business, cutting costs and adding value.

We use Lean thinking to eliminate waste, minimise bureaucracy and increase efficiency.

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“When developing new business areas and our activities with new clients it is important to have a strong base from which to build.

Our corporate responsibility strategy brings this, joining together strong technical and commercial initiatives with a focus on futureproofing for the environment, communities and our nation,s infrastructure.”

Rob Gillespie, Group Business Development Director

This is realising real cash savings for our customers – for example, through the increased productivity of road repair gangs. Carbon savings – in the form of fuel or resource consumption – usually come hand-in-hand with these financial gains.

We are also streamlining our in-house systems. By combining compliance audits with our assessments against the EFQM Excellence Model, we are making it easier to plan improvements as well as making the most of assessors’ time. The first combined assessment took place in our East Midlands division early in 2011. Another example is the integration of our specialists in health and safety and environmental management in a single support team (see Our people, page 21).

More generally, we recognise that our pursuit of efficiency and business improvement is inextricably linked with sustainability. Effective carbon management – for example, in our plant and fleet and in routing of road crews – drives efficiencies in our operations, delivering financial as well as emissions savings.

92.3% of all waste diverted from landfill in 2010

Emerging markets The third strand of our business strategy – diversification into growth areas – is just as closely entwined with our drive for sustainability.

Emerging markets can point the way to a low-carbon future as well as business potential. Last year’s report described the carbon-saving benefits of our first LED-illuminated road signs.

We are now working to multiply those benefits through a new partnership exploiting leading-edge developments in LED and solar power (see Our environment, page 27).

Other developments Our corporate responsibility strategy advanced on other fronts in 2010.

Responsibility for developing and driving the different elements of our strategy has, as previously mentioned, been assigned to members of the senior management. What the strategy means for our customers, people, environment and communities is described in the following chapters.

The work of our Low Carbon Steering Committee continued into its second year. This group brings together senior operations people with specialists in commercial and technical matters, environmental management and plant.

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CR Report 2010 A major output was a new carbon strategy. Entitled Committed to Cutting Carbon, this maps out the steps we will take to cut the Group’s carbon emissions by 5% each year between 2011 and 2014 (see Our environment, page 23).

The committee is preparing the ground for this carbon reduction within our business by building understanding of the issues and identifying and sharing best practice within the Group. Having identified the major carbon emitters within our business, we will develop and trial carbon reduction initiatives. A ‘carbon blueprint’ tool is also being developed to help Divisional Managers deliver the new strategy and local targets for carbon saving.

To ensure all carbon-related data is robust, the committee will also bring forward an auditing process for performance data in line with VINCI’s audit procedures.

We have carried out an initial review of the new standard for social responsibility, ISO 26000. This will be incorporated into our Five Year Plan and guide our strategy as it develops.

Supply chain A strong and flexible supply chain that complements the Group’s in-house capabilities is crucial to our effectiveness as a service provider.

Our supply chain partners share our values and we expect them to live up to their corporate responsibilities.

Through ‘early contractor involvement’, we identify value engineering opportunities, save clients money and minimise disruption to end users. We also share depots and offices, financial ‘pain/gain’ on some contracts, and training. Eurovia Group recognises and rewards innovation and sustainability in the supply chain through an awards scheme and regular briefings and workshops.

We have introduced Category Managers who ensure the Group and our clients receive best value for key products and services. The national frameworks and

service level agreements they negotiate, along with the buying power of the expanding VINCI UK Purchasing Club, are delivering valuable savings. These arrangements not only improve value for money, they are also generating new ideas and solutions for our strategic bids.

In 2010 we pioneered pre-bid workshops that allow us to identify and involve local suppliers who will be able to work with us from the start of new contracts (see case study opposite). In this way we can boost the support we provide to local economies and local authorities’ efforts to promote localism.

Our Contract Managers have access to approved national and local suppliers through a Group supply chain database.

Performance is assessed in a 360-degree review process, based on the EFQM Excellence Model used across our business. Where necessary, performance improvement plans are agreed with the supply chain partner.

During 2011 our eSource database will be developed to ensure a consistent approach to environmental, safety, equality and inclusion commitments as well as cost-effectiveness. It will link our supply chain performance indicators more explicitly to desired outcomes for the customer and our business.

Benchmarking progress Last year we reported that we had formally joined the Corporate Responsibility Index, the leading voluntary benchmarking scheme for UK companies. The Index provides a framework for managing, measuring and reporting on business impact on the environment and society. Its scores indicate how far management of the CR agenda has been integrated into the core day-to-day processes of the business.

Our 2009 report set out our target of achieving a 75% score and the ‘Bronze’ rating attainable by companies in the earlier stages of data collation and public reporting of environmental and social performance. We achieved that target (following publication of our 2009 report).

In 2010 we went on to make further progress. The Business in the Community CRI assessors have awarded Eurovia Group a score of 83%, lifting us into the Silver performance band. Its assessment showed improvement in almost all areas of the index, which ranges from corporate strategy to waste management and community investment.

Our Group’s progression between performance bands is a notable achievement, especially as the index is updated and strengthened each year as participants are expected to deliver continuous improvement. So we recognise that more work needs to be done to sustain and increase our score, especially in the challenging market conditions we now face. We remain committed to delivering real improvements to our clients and communities that are aligned with their and our CR objectives.

Carbon disclosure The Group also continued its participation in the international benchmarking scheme, the Carbon Disclosure Project. It is the third year that we have contributed on behalf of local authority clients and the Department for Transport. Again, the results showed that our performance was above the CDP average for a range of parameters: • Eurovia Group scored 100% for governance and for strategy and target setting, against CDP averages of 78% and 71%. For communications, we scored 92% (56% average).

• Our outperformance of the average in other areas reflected the influence of our Low Carbon Steering Committee, carbon strategy, and efforts to measure and monitor our carbon footprint. Our scores included: 69% for disclosure (48% average), 78% for emissions (46%), 73% for risk management (46%), and 77% for Scope 1, 2 & 3 carbon footprint reporting (63%).

CASE STUDY

The local link

Group companies are delivering added value and time savings through Early Contractor Involvement – and by applying the same principle to the supply chain. In 2010 Ringway went a stage further, getting potential supply chain providers involved in advance of bidding for new work.

The supply chain events were organised to maximise the scope for local small and medium-sized enterprises (SMEs), as well as national framework providers, that can complement Ringway’s self-delivery model in ways that maximise cost-effective service delivery, reduce defects and enhance assets.

A ‘surgery’ day was advertised in the local and trade press, and notified to existing framework suppliers.

The Group’s supply chain team were joined for the event by Ringway’s Regional Director, Bid Manager and the Divisional Manager nominated to run the contract.

Held before tender documents were issued, the day began with a “meet and greet” session for suppliers, followed by open discussion about the contract and one-to-one meetings with suppliers’ representatives.

A follow-up workshop was held mid-way through the tendering process when themes from the tender documents were explored.

This process allows Ringway to share its vision with all potential suppliers, to understand the challenges and barriers they face, and to foster an open and honest working relationship from the outset.

SMEs and existing framework suppliers have welcomed this approach, which should strengthen Ringway’s capacity to meet highway authorities’ requirements.

Local Supply Chain Days are now established Ringway practice, and are being emulated by other companies.

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Our customers In an era of shrinking budgets and overcapacity, the onus on service providers to satisfy customer need could not be greater. The success of our strategy hinges on our ability to align our products and services with the needs of our customers.

They and our other stakeholders also expect us to share their commitment to sustainability. This has shaped our strategy (as already described), and informs our approach to business improvement, innovation and the supply chain.

Service delivery The Eurovia Group approach to service delivery is based on teamwork – between the different parts of the Group, with our clients, and with our supply chain.

Our capacity to ‘self-deliver’ sets us apart from other service providers. We use our specialist in-house expertise and products where this is the most sustainable and cost-effective solution. It also means our people have the detailed skills and experience to advise clients without need for external partners.

We self-delivered over 77% of our term services work in 2010; up from 70% in 2009. This gives us greater control over quality and risk. But our procurement policy is flexible and balances the need to deliver best value and avail of

opportunities to support local economies while reducing delivery mileage (see Our strategy, page 8).

During the year we also improved the way we share our technical knowledge by developing our in-house training. An Innovation Award winner, our new course ensures all contract teams have a clear understanding and can better explain how our products and techniques solve the particular needs of clients, for example by optimising whole-life costs and reducing carbon footprints.

Transforming services We continued to raise standards of service and value for money on our term contracts through service level agreements (SLAs). In Worcestershire, for example, several facets of the highways services

have been transformed. The first SLA proposed by Ringway combined gully emptying and jetting with asset management planning so that gullies are managed more effectively according to need. Called Drainman, its success has inspired the Worcestershire Highways partnership to develop more cost-effective approaches to road patching, safety barrier maintenance, and road markings.

In Bracknell Forest, SLAs have transformed delivery of street cleansing, gulley cleansing and minor footway repairs

Group excellence rating 500 400 Average EFQM Score

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CR Report 2010

300 200 100 0

2004

2005

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Average score based on latest assessments for all business units against the EFQM Excellence Model

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2010

(see case study, page 15). While boosting service efficiency, these initiatives bring added benefits by freeing up road space, allowing the network to operate more effectively, and raising public satisfaction.

Transforming services can require lateral thinking. In Kent, Ringway’s streetlighting team retained two of the regional electricity network company’s personnel to make live connections to repaired or new columns. The “rent a jointer” agreement with UK Power Network and the county council eliminated delays and cut connection costs by 70%. Now we have gone further, gaining official industry approval to carry out live connections to unmetered electricity supplies. This means Ringway can recruit its own jointers, becoming a one-stop shop for the entire installation service. Having proven this approach, we will roll it out elsewhere.

Real partnering Our Group’s values promote the kind of partnership that makes these initiatives possible. This is borne out by our peers. In the industry’s 2010 awards for excellence, we featured in each of the three entries shortlisted for Effective Partnership by the Chartered Institution of Highways & Transportation. Worcestershire Highways was the winner (see right). Ringway was also highly commended for its effective partnering in Surrey, and our joint venture Ringway Jacobs was commended for collaborative working with Transport for London.

We also engage with our clients and share knowledge through our Client Forum. It allows open discussion between service heads in local authorities and our Effective Partnership Award senior managers on the challenges our clients face and What the CIHT judges said: “The submission how we can support them. We share performance demonstrated a fully integrated and effective data, float new ideas and agree priorities for further partnership. The results were a strong record in action in the forum, which meets twice a year. delivering service improvements. The partnership Improving the resilience of transport services in winter was a key topic at both meetings in 2010. had achieved an imaginative and ambitious Previous winter service performance was analysed and programme of service re-configuration and cultural

29% drop in service

strikes in 2010

improvements which have delivered value for money and customer satisfaction.”

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CR Report 2010 the lessons factored into planning for what transpired to be another challenging winter season. Other issues included localism, fluctuating prices, and carbon labelling.

Maximising value Delivering more for less is no longer an aspiration for public authorities; it’s a necessity if they are to maintain services and quality as budgets shrink.

We have robust systems to manage and control costs, and to secure value from our supply chain (see Our strategy, page 10), through strong cost capture, target setting and benchmarking. We earn trust and confidence through open-book accounting and sharing pain and gains. We also offer customers certainty and take on risk through lump sum payments for duties such as flood response.

Long-term asset management can reduce the annual cost of maintenance through, for example, the greater durability of materials designed by the Group’s pavement

engineers in Jean Lefebvre UK. This supports the twin aims of authorities seeking both to: reduce their environmental impact – by using less virgin resources and energy to extract and process them; and to manage road space better – with fewer roadworks and associated emissions from queuing traffic. A network built and maintained in a sustainable way with sound whole-life value also releases financial savings that can be reinvested in improving the asset and the service to communities.

Business improvement We are also releasing millions of pounds annually by re-engineering processes with our customers on Lean principles. Using the power of our tailored management information system eServe (see opposite page), we are streamlining response to highway defects and raising productivity, while providing real-time data to customers and reducing our carbon footprint.

As well as championing Lean, we have

“More than ever, our success depends on meeting and anticipating our customers, needs. Our sense of corporate responsibility is crucial to this. It cements our common purpose. We understand the pressing need to give taxpayers value for money and to cut the carbon and environmental impacts of transport infrastructure by delivering more sustainable services.

But we also appreciate that local authorities have wider social and local economic goals so we want to help make the communities we serve better places to live, whilst at the same time supporting local business development.”

Chris Connor, Term Services Managing Director, Ringway Infrastructure Services Limited

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been measuring our internal processes against the European Foundation for Quality Management’s Excellence Model for business improvement since 2003, which we are raising to 15% (see Our performance, pages 34-37).

Our EFQM programme drives improvement in every part of the business.

Our in-house trained assessors review performance, identify areas for improvement – along with best practice to be shared with other divisions – and agree action plans to be followed. Project Improvement Teams (PITs) also carry forward EFQM-inspired initiatives.

During 2010 eight business units were assessed. The combined score of 452 for the Group is a creditable achievement and represents a 7% increase on 2009. This takes us a long way towards our target of a 10% rise by 2013, which we are raising to 15% (see our performance, pages 34-37). Since 2004, the overall average has increased steadily from 287 – marking an improvement of more than 57% in that time (see chart, page 12).

Our achievements have been recognised by the British Quality Foundation. In 2010 Ringway Worcestershire won its annual Process Improvement award for streamlining the delivery of reactive highway works by area response teams. This followed its 2009 BQF award for Lean Six Sigma Partnership – a rigorous programme to reduce waste in the highways service and create value for customers.

CASE STUDY

The next level

Street cleansing, gully emptying and highway patching in Bracknell Forest have all been transformed under service level agreements (SLAs) proposed by Ringway.

Working together, Ringway Infrastructure Services and the borough council first tackled its street cleansing service. Resources were costed on an open-book basis, the contract specification was revised, and payment switched to an annual lump sum.

The new cleansing regime has raised standards of cleanliness and accelerated removal of graffiti and fly-tipped waste. Along the way Bracknell Forest garnered its first Britain in Bloom Gold Award for many years.

Similar efficiencies were achieved in gully cleansing after Ringway took over from the council’s preferred subcontractor. Joint audits have confirmed the service improvements. Again, lump sum payment gives the council certainty of price and saves inspection and management time, while also passing the risk of extra flood-related workload to Ringway.

The third SLA has changed the way minor footway defects are reported and repaired.

A new dedicated Reactive Patching Unit has generated significant savings that are reinvested in a microsurfacing programme, raising the condition of footways across the borough.

The success of the SLAs gave councillors the confidence to extend the five-year Street Care contract, which started in 2004, to September 2014.

Ringway’s term services division in the East Midlands was also honoured, as one of only four organisations to receive a 5Star rating for excellence. This requires consistent performance at the highest level to achieve a score of over 500 in an external BQF assessment against the Excellence Model. The division was also shortlisted with its client Peterborough City

Council for a Partnership Award.

Our progress in embedding Lean thinking and our clear sustainability strategy were also praised by the Highways Agency. The manager of England’s motorways and trunk network last year changed the way it evaluates the capabilities of its suppliers to focus on five key areas – leadership, supply chain, cost,

inclusion and sustainability. Its conclusions, following an assessment early in 2011, showed that Eurovia Group was well aligned with the Agency’s strategy “to become a truly sustainable organisation”.

Value of innovation Customers also value our strong record on innovation. In May Transport for London gave our LED signs its Innovation Award. We also picked up another CIHT prize – its Technological Application Award 2010 – for this product range, which was developed by Eurosigns in Weston-super-Mare. The signs add value by providing a low-maintenance, lowenergy solution that reduces the carbon footprint of highway signage. We are exploiting the cabon-reducing potential of LED and solar power further through our latest venture (see Our environment, page 27).

We recognise and reward the inventiveness of our people through a biannual awards scheme. It alternates with our parent’s Innovation Awards for VINCI companies worldwide. In 2010 we received more than 55 submissions for the Eurovia Group Innovation Awards in seven categories, including services, equipment and tools, health and safety and the environment. Ideas ranged from a simple de-icing solution using a dam of rock-salt bags where water runs across a road, to an improved patching repair material, Duraphalt Fill, developed in partnership with our supply chain.

Power of eServe Delivering the outcomes that customers want involves joining up all the people, systems and processes behind our service seamlessly together. This requires freeflowing information and an IT system to collect and process it. We have developed eServe, our electronic management information system, to do this crucial job.

Powerful, intelligent and above all, flexible, eServe can link together dozens of software applications and databases – hosted by us, the client or other partners – to match the needs of each contract and client. eServe ensures they are integrated in an accessible but secure environment.

In harness with our Masternaut vehicle tracking system, eServe supports asset management and greener fleet utilisation.

On hand-held devices, eServe mobile allows gangs to receive works orders, navigate to the worksites, transmit ‘before’ and ‘after’ photos, and update the management system in real time. Linked to highway authority systems, it facilitates streetworks permitting and live feeds to customer contact centres and public information online.

In these and other ways eServe helps us think and act like the client. On PFI contracts our MIS can provide all the supporting systems as we effectively take on the role of highway authority. It provides the accurate, real-time information that is critical to network integrity and road users’ safety.

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CR Report 2010

Our people Our primary duty as a responsible employer is to protect and promote the safety of our people. Of equal importance is our role as an equal opportunities employer with a strong focus on social responsibility, attracting and retaining talented employees, and investing in them to sustain the success of the business.

HUMAN RESOURCES Despite the economic downturn, a strategic decision was made to maintain a training budget of £750,000 in 2010. The level of training we give our employees exceeds the industry average. This reflects our belief that the skills and commitment of our people will determine the future success of Eurovia Group. We also recognise that investment in the development of employees, as well as their conditions and wellbeing, is essential to attract and retain the high-calibre people we need to serve our customers.

Training & development We provide a wide range of in-house and external training opportunities to help people at all levels to build competence and achieve their potential. In 2010 we delivered 47,000 hours of training. On average employees undergo 4-5 days’ training per year.

This ranges from induction courses and core technical and site-based skills, as well as schemes for apprentices and graduates, through to professional qualifications and our Through Career Development programme.

This programme is accredited by the Institute of Leadership and Management (ILM).

Managers are encouraged to work towards its Certificate in Management, with 20 enrolling in 2010.

We are also registered to LANTRA, and provide in-house training on various national highways sector schemes. Our aim is to achieve registration of all relevant employees under the Construction Skills Certification Scheme. By the year end 70% of our operational people had been registered.

More than half our workforce have at least one NVQ, some have more, and a further 20% are working towards one.

16

“Corporate responsibility is about the sustainability of our business as well as our society. It is not therefore something “pink and fluffy” that is just nice to have; it is a business imperative. We need to focus on the environment, our social responsibility, and the socially excluded people in the communities in which we work. We know from our employee feedback that having a positive impact in these areas can improve our ability to recruit and retain the right people for our business.”

Kristine Pollock, Human Resources Director, Eurovia Group

Our training team has developed a range of bespoke courses, including Highways to Excellence – a one-day workshop for employees, subcontractors and clients to discuss how we can all work together as a team to deal positively with road users and residents – and Unlocking our Sales Potential, which instructs contract staff in the sustainability and cost-benefits of innovative products.

Our Dealing with the Public course explains the importance of both verbal and non-verbal communication, and its effects on the perceptions of road users and residents. We closely monitor trainees’ satisfaction with courses and review the training needs of the individual and the business at Group and Divisional level.

A current training priority – apart from our ongoing health and safety training (see below) – is to develop our site-level managers. We are planning a special programme for site agents and supervisors leading to NVQs Level 3 & 4, a management diploma, and either IEng or EngTech qualifications depending on the role carried out by the employee and the NVQ level they achieve.

HR challenges

£37,140 donated to good causes in 2010

From a human resources standpoint, the economic climate poses particular challenges. Our managers must strive to streamline operations, reduce overheads, and match staff resources to contractual demands. In 2010 our total headcount fell to just over 1,800, reflecting the end of our Lincolnshire term services contract, other smaller transfers under the TUPE regulations and some redundancies.

At the same time we and our industry struggle to attract the new recruits who will take over as our workers retire. A tenth of our employees are due to leave us within the next five years. We are facing up to the threat of skills shortages, which are more acute in some regions, in a variety of ways. The following are just some examples of initiatives in progress.

17

Section

4

CR Report 2010 Young people

committed managers across the Group who act as mentors. We also have strong Our in-house schemes for training links with a number of universities and graduates and school-leavers have won professional bodies, such as the Institution several industry awards. Now in its 10th of Civil Engineers, which has awarded year, our graduate programme has professional qualifications to graduates on developed a new generation of upcoming our programme. We are represented on managers across the Group. More than a the advisory board of the University of dozen are in middle-manager roles.

Surrey.

This programme has not been affected Our apprenticeship scheme was by the economic downturn. It currently launched in 2008. The first cohort employs 12 graduates, 11 of whom were completed the programme in 2010. We scholarship students. There are 14 have small groups of apprentices in their university students now on the scholarship first and second years, and sustained our scheme, which provides sponsorship recruitment of apprentices through the during their studies and work experience downturn. This is a two-year programme placements during holidays. that combines on-site instruction and Our graduates and students gain broadexperience with classroom learning at based experience and support from Askham Bryan College in York. In 2011 we will develop a second programme in southwest England with our Effective leadership is critical when managing safety. Its importance is reflected in a new course launched in joint venture company, April 2010 for all employees with day-to-day responsibility for the safety of others. The one-day course is deSouth West Highways. signed to give delegates, who range from chargehands to senior managers, a clear understanding of how they We employ one should manage safety on site. A purpose-made training DVD helps put across the course’s key messages in a apprentice for every realistic and easy-to-understand way. £20 million turnover.

Delegates learn techniques to motivate colleagues as well as how to plan in detail for safety management This does not include and to monitor performance at each stage of a project, along with the corrective action they may need to take. apprentices employed The course includes an overview of the legal framework for safety management and incident investigation. by our joint venture Delegates then learn how to use the Group’s Incident Investigation Toolkit to produce comprehensive reports companies or the 38 trainees who in March and recommendations for preventative action.

By the year’s end the Health, Safety & Environment Department had delivered the course to 130 delegates in 201 completed our Trainee Highway six divisions, and it was extended to the rest of the Group in spring 2011.

Workers scheme, which

CASE STUDY

18

Managing site safety

targets young people not in education, employment or training (the Government’s high-priority NEETs).

People focussed Having earned our Investors in People status, over recent years we have steadily expanded our people-centred policies.

The aim is to make Eurovia Group a better place to work, and to support our people in a variety of ways.

We offer an attractive benefits package to all employees, including child care vouchers, flexible working and savings schemes. During the year we put together a discount package for retail goods, holidays and many other items, which we launched in time for Christmas 2010. Our Employee Assistance Programme provides free and confidential advice on a wide range of matters from personal finance to family concerns. This has been expanded to cover medical matters, general health and wellbeing. A new programme of monthly ‘toolbox talks’ on wellbeing themes such as tinnitus, smoking, and sun awareness is now running.

These measures are also designed to help us retain and attract people. We made it easier for potential applicants in 2010 with improvements to our dedicated people website. They can now register for email and SMS alerts about job vacancies, and apply online.

Handover: donating £1 per near miss in 2010/11 raised another £2,400-plus for road safety charity Brake

Employee involvement We believe our commitment to corporate responsibility and employee involvement enhances our appeal.

Eurovia employees can take paid leave to undertake voluntary work on charitable projects, and we match fundraising (see Our communities, page 29).

We track our employees’ opinions through regular surveys. Employees also help shape our HR and other policies through their involvement in events, including ‘round table’ meetings with the Group Managing Director, safety tours by senior managers, suggestion schemes, our Innovation Awards, Lean workshops, and ‘team of the month’ awards.

Ringway Buddies is an initiative aimed at helping people transferring to our term services business under TUPE. It was recommended by a project improvement team tasked with improving the contract mobilisation process. Now a Ringway ‘buddy’ supports each new employee during transfer and the early stages of the contract. It is proving a particularly effective way of introducing people to new processes and ways of working.

Benchmarking We monitor our HR progress and benchmark through the Highway Term Maintenance Association. In 2010 we performed better than average on sickness absence and

training input, though our voluntary labour turnover rate was slightly higher.

The HTMA people working group is striving to promote our industry as a career choice. During the year this group, which is chaired by our Group HR Director, also improved HTMA approaches on drug and alcohol testing, adherence to working time legislation, and the use of mobile phones at work.

We also contribute directly through our Schools Partnership, a programme of workshops for pupils run

by Eurovia graduates, and through other initiatives (see Our communities, page 30).

Our People Strategy Group, which was set up in 2009, directs all people-related strategies and decisionmaking. It meets every other month, is chaired by our Group HR Director and attended by all senior managers.

Diverse opportunities We are committed to providing equal opportunities for all and want to reflect the communities we serve. It is also in the best interests of the business that we draw from as big a pool of human talent as possible.

The Group promotes diversity in the workforce. We have clear policies on equality, diversity and discrimination and monitor performance. Following an audit of over 100 VINCI companies, our Group was commended for best practice in several areas, including how we combat discrimination, support employment for ethnic minorities, and foster career development for women.

We support the industry’s efforts to increase the representation of women in the workforce. Following on from 2009, when 38 of our female employees achieved NVQs on a women-specific programme, a further 12 gained similar qualifications early in 2010.

Our scheme for training and employing young ex-

offenders, which won a VINCI Global Innovation Award in 2010, continues to draw support from our clients too.

Where possible, we work with local prisons to select and train potential recruits (see Our communities, page 30).

HEALTH & SAFETY Over the last decade we have made huge strides in safety management and performance. That progress has been sustained in recent years by a strong safety culture developed and reinforced through behavioural training.

Health and safety is a line management responsibility and a top priority. Our Group Managing Director chairs the Health, Safety & Environmental Steering Committee that drives policy in this area. It is based on robust procedures integrated within our management system, The Way We Work (accredited to OHSAS 18001).

Our approach to health and safety is also underpinned by regular behavioural auditing, reporting and analysis of near misses, investigation of incidents, and a comprehensive safety training programme.

Safety training Our two-day Managing Safety course, which is externally accredited by the Royal Society for the Prevention of Accidents, is delivered in-house and available to all employees ‘who put others to work’. We have run 74 of these courses over the past nine years with 18 delegates attending each course.

In 2010 we introduced a new Worksite Safety course.

It was developed in-house, along with a supporting DVD. One module covers the use of our Incident Investigation Toolkit, which was also developed further during the year. It will provide greater insights into the root causes of safety lapses and how to prevent them.

19

Section

4

CR Report 2010 Safety performance Following an improving trend sustained over many years, 2010 saw a reversal in some key performance indicators.

• The overall measure of incidents resulting in time off work, the lost time incident frequency rate (LTIFR), rose to 5.55 (per million person-hours) from 5.32.

This is an increase of over 4%.

• The frequency of more serious incidents, reportable under the RIDDOR regulations, was also higher at 0.42 (per 100,000 hours worked) – a 5% rise.

• There was a drop in the number of near misses reported at 1,468. The figure fell back by less than 10% from the record levels set in the previous two years.

• The falling trend for service strikes accelerated with a near-30% drop to 161.

The continuing reduction in service strikes is welcome, and reflects our ongoing investment in training, cable and pipe detection, and other initiatives to promote safe digging practices.

We continue to encourage near miss reporting by donating £1 to the road safety charity BRAKE for each report filed.

Despite the drop in 2010, which is related to the reduction in the size of the workforce, reporting is at a healthy level in keeping with the proactive safety culture we are promoting.

Our commitment to driving down

20

incident rates is enshrined in our updated Five Year Plan. We are determined to get back on track by more than halving the lost-time rate to 2.5, and have reaffirmed our goal of a zero RIDDOR rate (see Our objectives, page 37). Each division has been tasked to analyse all its incidents in 2010, identify patterns and set appropriate objectives. Additional actions are being agreed following a health and safety ‘climate survey’.

Reality check This comprehensive survey of employee views has provided reassurance that the Group’s safety culture remains strong, while identifying areas for improvement.

The climate survey, completed at the end of the year, saw contributions from 90% of our employees. Over two thirds were operatives. The results showed: • The vast majority of employees are clear

Acting on ideas

about their health and safety responsibilities – 92% strongly agreed that ‘I understand the safety rules for my job’; • Safety is seen as a top priority by most – 80% strongly agreed that ‘management clearly considers the safety of employees of great importance’; • Communication on health and safety matters is viewed very positively – nearly three in four employees (72%) strongly agreed that ‘we have an open door policy on safety issues’.

This ‘reality check’ has confirmed that we do have a culture of challenging and supporting each other to improve our safety performance. But its findings, analysed by job type and division, also show areas for improvement. Small task groups are reporting back with priorities and action plans for their divisions to be implemented in the coming months.

Safety-enhancing innovations implemented in 2010 include:

• A centralised system speeding up access to COSHH assessments of materials;

• An improved Euromark heater box for moulds that reduces the risk of fire or injury to roadmarking operatives;

• Fitting gully tankers with a blue directional arrow sign and ‘wig wag’ LED lights to increase visibility to drivers;

• A redesigned bitumen boiler for sites, with similar safety and financial benefits;

• A depot ‘branding’ approach to improve signing of walkways, no-go areas and other potential hazards;

• An electronic system that allows better management of workers’ PPE (personal protective equipment and clothing).

• An improved induction process specific to each site that ensures all staff have relevant safety and emergency information.

The way we provide specialist support to our operations was reorganised by combining our specialist advisors on health and safety with their counterparts on environmental matters in a single team.

1.2

10

1.0

8

0.8

6

0.6

4

0.4

2

0.2

0

2004

2005

2006

2008

2007

Near misses & Service strikes

Near misses

LTIFR (per 1 million hours worked by employees and supply chain partners)

2009

2010

Incident rates

0

RIDDOR (per 100,000 hours worked by employees)

2000

400

1500

300

1000

200

500

100

0

2005

2006

2007

Number of near-miss H&S incidents

2008

2009

2010

Service strikes

Other developments

12

Reportable incident frequency

Employees are involved in health and safety matters in a variety of other ways, including toolbox talks, safety tours of sites by senior managers, contributions to our annual safety calendar, our parent company’s International Safety Day, and an annual safety briefing.

Sustaining interest is an ongoing challenge. During the year we refreshed our managerial health and safety meetings by opening them to employees at all levels. This new workers’ forum allows people to take ownership of the issues that affect them, and we expect this will reinforce and reinvigorate our safety culture.

We also gained a Gold Medal Award for Occupational Health and Safety – our ninth successive award – from the Royal Society for the Prevention of Accidents.

Employees submitted more entries for our Innovation Award for health, safety and the environment than for any other category. A wide range of innovative measures have been implemented (see box), along with others designed to enhance the safety of the public (see Our communities, page 30).

This multi-skilling has allowed us to increase our efficiency while broadening the support provided to the divisions.

Our Vigiroute programme for managing the risks our people face while driving on the roads continues to advance. We use data on crashes to evaluate in a systematic way the risk for every driver of a commercial vehicle or company car. They then receive targeted training and support. From 2011 this involves an escalation process.

After a first crash, the driver receives classroom training. In-vehicle training is provided following a second incident.

We are also participating in the Drive for Life campaign (see Our environment, page 25).

This work to manage road risk during 2010 was recognised by RoSPA, which presented us with its Gold Award.

Our Vigiroute initiative was also highly commended by the campaigning road safety charity Brake. The Group's Health, Safety & Environment Manager, David Campbell, was a runner-up for Brake's annual Road Risk Manager of the Year Award.

Another transport initiative is promoting the safety of road users, particularly cyclists. Proximity indicators that detect cyclists on the blind side of trucks were trialled by Eurovia Roadstone in 2010. They are now being fitted to the entire fleet based at the Dagenham plant (see Our communities, page 31).

Lost-time incident frequency

Involving employees

0

Number of incidents of damage to utility services

21

Section

5

CR Report 2010

Our environment Eurovia Group manages its environmental impacts responsibly and we are committed to action that will curb the carbon emissions that contribute to climate change.

Environmental management

“We aim to lead the way in the roadmarking business by reducing our carbon footprint. Part of my role is to get people engaged in this and other initiatives on corporate reponsibility.

I find people want to contribute when they understand the benefits to the business and the environment. CR is also about innovating and we are working closely with our supply chain to develop sustainable products. Our clients share our commitment to CR and they are scrutinising our approach more, so it’s essential too for securing work in the future.”

Kevin Ward, Member of the Low Carbon Steering Committee

22

Responsibility for minimising environmental impacts is embedded in our day-to-day activity through The Way We Work, our integrated management system. It is accredited to the appropriate international standard (ISO 14001). We keep the system under review. Its processes for monitoring sustainability, in particular, are being developed.

We are improving the way we collect our environmental data – especially energy consumption – following an audit conducted by KPMG on behalf of VINCI. Having previously used an external service provider, we brought the data collection role back in-house and are making other improvements. These changes, including checking carbon emissions data against information from our IMS, make our environmental reporting more robust.

No enforcement action or notices were issued by environmental regulators against our Group during the year. The number of environmental incidents was stable at 27 for the year. Having simplified the reporting procedure – in a single, simple form that captures information on safety incidents as well – we have confidence in the figures and remain committed to minimising their number and impact.

All our depots and appropriate vehicles are equipped with spill kits to prevent contamination of groundwater and water courses, and our personnel are trained in their use. The risks of environmental pollution are also made clear in new ‘gang packs’ providing guidance for crews working on the highway.

Training From induction through regular ‘toolbox talks’, the training we provide reinforces employees’ understanding of our duty of care, typical environmental risks, and emergency procedures. We delivered more than 1,100 hours of environmental training in 2010. Although considerable, this is a reduction on 2009 when mobilisation for new contracts saw a sharp rise in environmental training.

We updated our training guides to reflect the importance of biodiversity in 2010 and are preparing a new course aimed at both managers and operatives. It will use an environmental training DVD we are developing with the Highway Term Maintenance Association.

Climate change Our stakeholders – from employees and shareholders to customers and government – expect us to curb the emissions that are driving climate change. Our pursuit of efficiency and continuous business improvement only reinforces this pressure for effective carbon management.

As promised in our 2009 report, our Low Carbon Steering Committee developed a carbon strategy for 2011-2014.

Entitled Committed to cutting carbon, it reaffirms our previous policy commitment to a 5% year-on-year reduction from the Group’s 2008 baseline figure and maps out how we can achieve this (see below.).

Cutting carbon Eurovia Group is committed to cutting its own emissions at source primarily by investing in improving the efficiency of operations. We believe this is better for the long-term future of our business than offsetting emissions from our activities by buying carbon credits, and it will add value for our customers.

We will work towards a low-carbon economy by: • Measuring and managing our greenhouse gas emissions • Investing in carbon reduction improvements and technology • Developing low-carbon products and services • Influencing behavioural change To achieve our target of a 5% year-on-year reduction in emissions from our 2008 baseline, we must first focus on our key greenhouse gas emitters: asphalt production and use, fleet and plant use, and depots and offices. By reviewing our activities we are programming our works more effectively with the aid of our newly deployed management information system eServe (see Our customers, page 15) and working smarter to benefit the environment and our customers. And through innovation we can also develop low-carbon products and services that will reduce the carbon footprint of our transport infrastructure.

Our strategy also recognises the need to adapt to the consequences of climate change. We must tailor our services and products to deal with increased flooding, greater unpredictability in the weather, and operating in drought conditions, for example.

7% rise in the Group, s excellence rating in 2010

23

Section

CR Report 2010

5

CASE STUDY

LED signs show the way Innovative LED signs are showing highway authorities the way to cut carbon emissions, traffic disruption and costs. The 12-volt units manufactured by Eurosigns (UK) use up to 60% less power than conventional illuminated signs. They also require less maintenance with no need to replace fluorescent lights, or recycle mercury.

Trials show the units not only have a big impact but they also lend themselves to innovative installations. In an early BEAR Scotland trial, an internally lit LED sign on the approach to an accident-prone A68 crossroads performed extremely well in night-time appraisals. An attitude survey in BEAR’s larger trial in Elgin showed a clear majority of road users preferred the level of pure white lighting provided by LED luminaires.

Dudley engineers praised their LED give-way sign for minimising light pollution and concentrating drivers’ attention. In Solihull, an Eco-Powered LED sign avoided the need for ducting across a busy sliproad to an A41 roundabout; installation of the cable-less sign, which uses solar and wind power, saved a couple of weeks’ work and traffic management. Extending mains electricity to signs around Heathrow Airport’s Terminal 1 (pictured) would also have been highly disruptive and costly. Eurosigns devised a solution involving solar charge controllers and a bespoke battery/panel carrier. Elsewhere at the airport, a slot-cut solution saved over £1,600 per unit in civil and traffic management costs.

24

Carbon trading Trading of emissions is mandatory under the Carbon Reduction Commitment (CRC). It forms a crucial part of the national strategy to reduce carbon emissions by 80% from 1990 levels by 2050.

The Coalition government put back the auction-based scheme’s introduction by a year to 2012, and removed its revenue recycling element. This carbon tax will add directly to the costs of our operations and supply chain, particularly for energy-intensive products such as asphalt. Many of our clients are also subject to the CRC, which will further squeeze local authority budgets for highway maintenance and capital projects.

The tax is another incentive to reduce our carbon footprint by investing in energy efficiency, but it also affords further opportunities for providers of alternative low-carbon solutions, which we must seize.

Energy performance ISO 16001 represents the latest best practice in energy management and builds on existing national standards and initiatives. During 2011 we intend to review the standard’s requirements and assess the benefits of implementing an energy management system following its guidelines.

Another option under consideration is micro-generation, which could reduce our carbon footprint and reliance on fossil fuels. We will investigate the feasibility of trialling energy microgeneration technology within depots supporting long-term contracts.

Measuring performance Our carbon performance is coming under greater scrutiny as part of the tendering process. Bids for PFI contracts must predict carbon emissions over their 25-year life. This requires complex modelling, taking account of whole-life costs and the carbon footprint of different design options. Carbon performance is also factored into payment mechanisms.

Over time, we expect this PFI approach to filter down to term services so that providers will be differentiated by their carbon performance as well as costeffectiveness. We are trialling bespoke ‘carbon calculators’ that can be used on our term maintenance contracts and PFI contracts to map their carbon impact.

Under the guidance of the Low Carbon Steering Committee, we are also developing a ‘carbon blueprint’ tool to help our management teams understand their carbon performance. This will be crucial to implementing carbon reduction initiatives in our divisions, and is a key objective for the coming year.

Carbon labelling Our work to provide customers with definitive carbon labels for highway solutions continues. This partnership project with the Carbon Trust has the backing of our Client Forum. It will initially enable the ‘cradle to gate’ carbon footprinting of a standard hot-mix asphalt – as a ‘control’ or baseline reference – along with more sustainable options.

These are: Eurovia’s warm asphalt Tempera, plus the structural and storage grade versions of Foambase, and Gripfibre microsurfacing, which are coldmix products (see overleaf).

Progress was delayed by difficulties in micro-metering of fuel to the plant’s burner, which is essential to measure energy usage reliably. Another issue to be resolved is the CO2 value, if any, of RAP (reclaimed asphalt pavement) when used in a cold-mix product such as Foambase.

Transport emissions Our transport and plant fleets are another major emitter, but we have improved how we measure and monitor our fuel consumption and carbon emissions. Our Plant & Fleet department is also driving a series of initiatives to increase fuel efficiency and reduce our carbon footprint.

Our Group makes extensive use of Masternaut vehicle tracking technology

and Lean thinking in the way we plan works. We eliminate unnecessary mileage by optimising the routes of road repair crews and winter gritting fleets.

In 2010 we took this further with Masternaut’s GreenerFleet management tool, which promotes safer and greener driving. It tracks driver behaviour and vehicle use, linking this to vehicle emissions and fuel consumption.

On one contract, for example, we cut spending on fuel from £8,000 per month to £3,500 through a combination of improved planning and driver behaviour, using our GreenerFleet and Lean works planning tools.

Before the year’s end we began trialling the next step in fuel management. Three of our vehicles were fitted with Masternaut’s CANbus – a driver and vehicle performance system that maps improvement in driving techniques using five parameters: harsh braking and acceleration, over-revving, speeding and excessive idling. An in-cab display alerts drivers when these events occur. Early results from the trial showed that drivers reduced fuel use and emissions by 3.5%. It is hoped that altering driving styles will also reduce accidents and vehicle wear and tear.

Other drivers will have an additional incentive to improve their driving habits as part of the Drive for Life campaign in 2011. Supported by Masternaut and Royal Sun Alliance, this will include a

Eurovia Group competition for the best commercial vehicle driver judged by safety and environmental performance.

There are separate categories for fuelefficient driving by a young driver, commuting by alternative modes of transport, and driving knowledge. The initiative is part of our Vigiroute programme to manage road risk (see Our people, page 21).

Alternative fuels The truck fleet is equipped with the latest Euro 5 engines and we use EN590 diesel containing 5% biofuel. The Group’s Euro 4 vans are progressively being replaced by models conforming to the higher emission standard. Our company car policy now promotes fuel-efficient choices, including two hybrid models.

The trial of a hydrogen cell fitted to trucks on our Kent and London contracts yielded disappointing results. The team is investigating an alternative hydrogen generator that could be retrofitted to diesel vehicles or plant for a new trial.

This generator is designed to ensure a cleaner burn of the fuel, and promises to reduce carbon and other emissions by up to 40%, while boosting power output and fuel economy.

Resource use Making best use of the earth’s finite resources makes increasing sense from

the perspective of the business as well as sustainability.

We seek to minimise waste through Site Waste Management Plans, and work with waste specialist Reconomy Solutions to optimise recycling and re-use.

Our network of waste recycling centres process highway waste arising from our highway contracts. More than 750,000t were generated in 2010 and we increased the proportion diverted from landfill to more than 92%. The materials involved range from topsoil, road planings and gully waste to wood, plastics and green waste. Our target remains to recover 95% of the total by 2013.

We strive to put recovered highway materials to productive use in Foambase and other in-house products. We are working with the Environment Agency to show the scope for safely recycling hazardous tar-bound materials (see below).

During 2010 our Gully Group has been analysing the environmental and financial implications of traditional, reed bed and mechanical options for dealing with gully waste and the associated wastewater.

The study covered facilities we operate as well as new and emerging developments. In 2011 the group aims to develop operational guidance we can use in conjunction with our clients to plan and develop future facilities. It will ensure that the whole-life costs and

25

Section

5

CR Report 2010 environmental benefits of gully waste treatment can be fully considered in the decision-making process.

Water management Water is another increasingly scarce resource that we need to conserve as well as protect.

We have invested in facilities to recycle water used for washing down vehicles. On the highway our crews follow a standardised procedure to ensure that water is extracted from hydrants in accordance with the requirements of the local water authority.

We have also begun to ‘footprint’ the water we use in products as well as our operations. This is now a standard performance measure, and we intend to improve our monitoring through 2011. PFI bidding requirements and the particular vulnerability of southern England to water scarcities are driving this effort. This could have potentially far-reaching implications for our contracts, water-intensive operations and procurement policy.

Sustainable products Our parent Eurovia invests €7 million in research and development each year, 70% of which is dedicated to projects promoting environmental sustainability. Much of our R&D programme in the UK is also directed towards delivering more sustainable solutions for our customers.

Through Jean Lefebvre UK, which has unrivalled expertise in technology transfer, we enjoy close links to the worldwide technical network of our parent companies, and in particular the Eurovia SA research centre in Bordeaux, France.

We have introduced to the UK market a range of products that benefit the environment, often in several ways: by avoiding carbon emissions, reducing waste or landfilling, re-using waste material, or consuming less virgin raw material.

26

High mark: Water self-sufficient, High Post depot in Wiltshire filters gully waste through straw bales and a reed bed

Production of these products fluctuates depending on the balance of highway authorities’ maintenance programmes and changes in the number and mix of our contracts for term services, surfacing, and other major works. Demand for UL-M, our wellestablished thin surfacing, for example, was buoyant in 2010.

However, the reluctant take-up of Tempera – the pioneering energy-saving warm asphalt – was highly disappointing (see Our performance, page 34).

We recognise that conservatism in the highways sector and budget cuts are major impediments to the adoption of new solutions. Our contract teams are being trained to communicate the carbon- and cost-saving credentials of our range of innovative products more effectively. We will build targets for our greener products into our next business plan, while sustaining our research and development programme.

This is progressing some notable projects that save on carbon and/or virgin materials:

12000

• The use of Foambase, our proven cold-mix product that also utilises recycled materials, is being trialled as a solution for tar-bound materials, which are environmentally hazardous and expensive to landfill safely. We are also actively contributing to the Environment Agency’s national working group on this major issue for highway authorities.

• We are developing a new generation of illuminated signs in partnership with ZETA – a specialist in LED and solar technology. The new LED units will provide twice the light for much lower power consumption. Planned solar solutions will also help highway authorities reduce their energy costs and carbon footprint while enhancing road safety (see case study, page 24).

600

93.3% 90.9%

300 78.2% 0

2006

2007

2008

2009

Waste diverted (tonnage and percentage)

Waste landfilled

2010 Secondary materials*

* Secondary aggregates and materials sourced from external providers for use in Group products and schemes

150 120

Sustainable products

Think green

90 60 30 0

2004

2005

2006

2007

Fibrovia

ULM

2008

2009

2010

Ultraphone

80 70 60 Thousand tonnes

We encourage ‘green’ thinking across the Group through our in-house Innovation Awards. The 2010 competition attracted a wide range of entries in the Carbon Reduction category. The winner was a low-carbon Christmas campaign that reminded employees of the small steps they could take to reduce their and our carbon footprint.

Other valuable ideas included a miles-per-defect measure in Worcestershire to match productivity with fuel efficiency; adapting microsurfacing technology to reduce the emissions and cost associated with conventional road patching; and using recycled plastic discs to control weeds around signposts, avoiding the need for strimmers or chemicals.

The next generation of Eurovia Group managers are helping to shape our approach to carbon management. Following a presentation on environmental issues at a workshop for our graduates, they developed a campaign to raise awareness and engage employees at all levels in carbon management. One proposal was to reflect this priority in a new Group value of Efficiency in how we work and use energy. This will be considered by the Low Carbon Steering Committee.

92.3%

90.4%

Thousand tonnes

• We are developing cold-mix processes that exploit hydraulic, emulsion and foamedbitumen binders.

Waste management & recycling

900 Thousand tonnes

• Ecolvia is a cold asphaltic concrete surface course produced specifically for lowtrafficked carriageways and footways. Its design combines a special emulsion binder with a pre-determined amount of recycled aggregates.

Low-carbon products

50 40 30 20 10 0

2006

2007

Foambase

2008

Gripfibre

2009

Griptex

2010

Tempera

27

Section

6

CR Report 2010

Our communities Given our corporate values and day-to-day duties, it is not surprising that a strong sense of community permeates our culture and workforce. Most of our front-line staff are local people serving their own communities.

Public service Residents, neighbours and the travelling public are the ultimate customers of the services we provide each day.

The vital role our people play is most apparent at times of emergency. Our winter maintenance teams again garnered praise for their dedication and effectiveness in severe conditions. Our crews are also increasingly in action responding to local flooding.

We see at first hand the impact of what we do, both negative – delay, diversions and disruption, and positive – such as road and footway defects repaired, smoother and safer surfaces, clearer signing. Our people at all levels tell us that delivering these benefits – in safety, workmanship, quality of infrastructure, and the visual environment – is a major source of job satisfaction.

That is why we share with local authorities the view that the roads and streets we maintain are not just links that are vital for moving people and goods, but also places where people live and work.

Serving customers We plan all our works carefully to minimise disruption, consult locally and give advance notice. The methods depend on the type of scheme and its scale, and include leaflets, public meetings, radio announcements, weblogs, and ‘surgeries’ for traders and shoppers.

A full-time Liaison Officer fills that role on major schemes in towns – as in Loughborough, for example, where we are building a new link road and improving the area around the Leicestershire town’s train station as part of the Eastern Gateway project, under our Midlands Highways Alliance framework contract.

“Corporate responsibility means taking a balanced approach and considering the commercial, social and environmental impacts for all we do. Our commitment to community engagement and volunteering benefits our staff at all levels. Feedback has shown that our people gain and develop skills, get a great deal of satisfaction and want to work for a business with a sound approach to CR. This is particularly true for young people joining us who see corporate responsibility as a key part of everyday business.”

Mike Burnett, Chair of Ringway in the Community Committee

28

In Wiltshire, our staff are embedded in village communities as Parish Stewards, tending directly to the road maintenance priorities of local councillors and people.

Reflecting our commitment to customer service, we piloted a new course for front-line personnel in 2010. It coaches people on the verbal and non-verbal communication skills required when dealing with the public.

The training has proved so popular and worthwhile that we are rolling it out Group-wide, starting with all new contracts.

Mutual benefits

83% score achieved in the national CR Index

Our approach to corporate responsibility recognises that investing in communities is not only worthwhile in itself, it also benefits the business. Staff morale, the company’s image and reputation, team-working and creativity are all boosted through community engagement.

In 2010 we widened the membership of our Ringway in the Community Committee, which represents the entire Group. It has redefined and communicated our policy to all our people. The policy gives priority to projects and charities that reflect our activities by promoting the environment, education, health or employment.

All our employees are entitled to two days’ paid leave per year to volunteer for a registered charity or community project that meets those criteria. We match funding raised by our people for these good causes.

Through Business in the Community and other agencies, we provide volunteering opportunities. For several years our Group has supported the Calthorpe Project, a community garden and centre near King’s Cross in London.

Its new facility for under-5s opened in spring 2010 in a building extension part-funded by a £45,000 grant from our parent company’s charitable trust, The Vinci Foundation.

29

Section

6

30

CR Report 2010 We also participate in the BiTC’s national Give and Gain Day. On July 9th 2010 over 60 volunteers from Eurovia Group companies around the country worked on eight local projects. Colleagues from client authorities and suppliers were also involved (see opposite page).

Our people gained from the experience, judging by the volunteers’ responses to a follow-up survey. Everyone involved said they would be interested in volunteering again and would encourage colleagues to join them.

Nine out of 10 said the experience exceeded their expectations. A similar number saw the Group’s support for their project as a reason to recommend working for Eurovia. And three out of four felt the skills and competency developed as a volunteer would be useful in their day job.

Building bridges Sustainability in our business and the wider community link in other ways.

Our award-winning work with young exprisoners provides training and jobs, and a route out of social exclusion and reoffending. It also addresses skill shortages and redresses the age profile of our workforce. Having run schemes with prisons in Kent, Reading, Lincoln and Dartmoor, we are developing our framework with a view to extending this recruitment programme to other areas and disadvantaged groups.

The Eurovia Schools Partnership promotes careers in construction while supporting students’ learning in maths and science. Now in its seventh year, the scheme is run by graduates on our internal development programme.

They liaise with teachers and run workshops in teambuilding exercises, such as paving, surveying and setting out.

In 2010 the team ran events at St Crispins in Wokingham, Gravesend Grammar in Kent, and The Cornwallis Academy in Maidstone. Feedback from students and teachers on the hands-on educational days was extremely positive.

Other employees have

become STEM Ambassadors. A Ringway Site Agent and Operative on the Midlands Highways Alliance’s project in Loughborough are using their skills to inspire young pupils to learn about Science, Technology, Engineering and Maths.

Our involvement with schools ranges from sponsoring a ‘walking bus’, that gets primary kids out of cars and safely to class, to hosting educational site visits.

Communication and safety People at all levels buy in to the Group’s mission to serve our communities, as entries to the 2010 Innovation Awards show. Many were designed to improve how we communicate with residents and road users, and enhance their safety.

They included: a weblog to keep residents abreast of roadworks progress; an LED message board fitted to the rear of maintenance vehicles to display the duration of works; a pass allowing residents quick and easy access through a road closure to their homes; an improved pedestrian barrier to protect the public at roadworks; and a more robust support system enabling flector-style bollards to be re-set when knocked down.

Ringway Jacobs, and other Group companies, have been closely involved in the roll-out of London’s first blue Super Cycle Highways, part of Transport for

London’s strategy to quadruple bike use. Eurovia Specialist Treatments produced and tested the specialist surfacings for TfL. Also with cyclists in mind, in 2010 Eurovia Roadstone trialled a safety system designed to address one of the greatest hazards for cyclists in towns – heavy vehicles turning left.

Fitted to a truck, this uses nearside sensors and cameras and an in-cab display to alert drivers to a potential hazard. When they are activated and the driver indicates left, an audible warning device also announces: ‘Caution! Truck turning left’.

Following the two-truck trial, the system is being installed on the rest of the 38-strong fleet at Dagenham, which serves London, Kent, Essex and Suffolk.

Other stakeholders Our industry and our other stakeholders in local and national government, professional bodies and technical groups share a sense of community too.

Eurovia Group is actively engaged with a variety of organisations that promote and influence our sector and its interests. We contributed to several working groups of the Highway Maintenance Term Association on important issues. These include: working with surveyors and clients to develop standard price adjustment indices for term contracts; safety benchmarking; and sharing environmental best practice. Our people also currently chair the Road Surface Treatments Association and the Road Safety Markings Association.

As a member of the Chartered Institution of Highways & Transportation’s Corporate Partner Scheme, we work together to promote excellence in the sector. We are represented on the CIHT’s Executive Board and Council, and through the institution, seek to inform and engage with government policy-makers.

Our senior managers also engage directly with key clients such as the Highways Agency and local authority leaders to better understand their concerns and pressures and how we can apply and extend our capabilities. This dialogue will be particularly important in the economic climate projected over the medium term.

CASE STUDY

Giving and gaining Eurovia volunteers put in over 500 hours’ work on eight projects on July 9th 2010 as part of the Group’s Give and Gain Day. The community groups and amenities that benefited included schools, woodland, wildlife trusts, residential areas and a care home.

The teams, drawn from Group contracts around the country, improved access for the disabled at a Peterborough school and a forest park in South Gloucestershire; erected a new entrance and created hibernacula for reptiles in a Wiltshire nature reserve; improved the gardens of a care home in Bracknell; removed bracken and replaced fencing in a Surrey wildlife reserve; and cleaned up a rundown housing estate in Rotherham.

The team from Ringway Infrastructure Services North who spent the day at a school for disabled children in Lincoln (pictured) typified the feedback from employees. “The small amount of time given by us made such a difference to the school,” one volunteer remarked.

The eight volunteers constructed a footway providing wheelchair access to a newly planted garden area, using different types and colours of blocks and slabs to provide added visual interest for the autistic children at Queens Park School.

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Section

7

CR Report 2010

Our performance EUROVIA GROUP

INDICATOR DESCRIPTION

2004

2005

2006

2007

2008

2009

Turnover (ÂŁ million)

Excludes joint ventures. 2010 figure is provisional, unaudited

299

333

324

332.3

343.2

332.6

296.5

Turnover (ÂŁ million)

Includes joint ventures. 2010 figure is provisional, unaudited

406.5

425.6

431.9

392.5 392.5

Employees

Number of direct full/part-time employees at year-end

2,666

2,643

2,507

1,813 1,813

!!!!! Reduction due to end of Lincolnshire contract and some redundancies.

IMS registration

Proportion of Group business units where The Way We Work integrated management system is registered to relevant standards

ISO 14001

Standard for environmental management

20%

30%

61%

83%

87%

95%

93% 93%

!!!!!

OHSAS 18001

Standard for management of health & safety

4%

19%

61%

78%

83%

84%

97% 97%

ISO 19001

Standard for quality management

48%

59%

89%

96%

96%

100%

100% 100%

11.1

7.85

9.33

7.61

6.73

5.32

5.5 5.55

0.97

0.92

0.77

0.56

0.52

0.40

0.42 0.42

Health & safety LTIFR

Negative trend Positive trend No or little change/ new parameter Cannot be coded as reflects nature of business/tender succcess

RIDDOR

2,584

2,450

TREND

COMMENTARY

!!!!!

End of a major contract, reductions in client spend and competitive pricing depressed turnover.

!!!!!

!!!!! !!!!!

Changes reflect variarions in business as contracts run by registered business units ended and new operations are prepared for certification.

(Figures are rounded to nearest whole number.)

!!!!! The results from the re-investigation of incidents at divisional level and a safety climate survey are being analysed and will be used to set objectives to drive incident rates back onto a downward trend. !!!!!

!!!!! Reduction from record reporting level in 2009 attributable to decrease in workforce. On a per-capita basis, reporting continued to rise.

Near misses

Number of near-miss H&S incidents reported by employees

15

12

66

422

1,603

1,615

1,4 1,468

Service strikes

Number of incidents of damage to utility services

194

263

318

378

310

228

161 161

!!!!! Divisional targets backed up by safe-dig guidelines, dedicated CAT detection teams, and awareness-raising through safety briefings and toolbox talks continue to drive down incidents.

Environmental incidents

Number of environmental incidents reported by employees

5

3

16

19

43

28

27 27

!!!!! Stable under consistent reporting procedure. Incidents are being captured and controlled. No actionable incidents during year.

Environmental training (hours)

Hours of in-house training delivered on environmental matters

862

625

516

2,381

1,267

2,201

1, 1,166

Total waste generated

Materials arising from all highways-related and other core activities

249,276

517,867

1,157,609 768,178

757,574 757,

Waste landfilled Total waste diverted

Tonnes of waste sent to landfill for disposal Tonnes of waste materials diverted from landfill for re-use or recycling in-house (eg, in Foambase)

54,449

49,620

77,839

58,263 58,263

!!!!! Reflects reduction in activity and changing mix of scheme and routine maintenance works, but more significantly, better segregation and handling of waste through site waste management planning. !!!!! Slight increase achieved despite downturn in operations.

% waste diverted Virgin materials used

Proportion of total waste arising diverted for re-use/recycling Total tonnage of materials used from virgin sources such as primary aggregates Total tonnage of secondary materials procured in addition to those recycled in-house Estimated total usage of water (litres)

Environmental

Recycled materials used Water consumption

32

Lost-time incident frequency rate per million person-hours worked by Group and supply chain partner employees Incidents notifiable under RIDDOR regulations per 100,000 hours worked by Group employees

2217

2010 2010

69,962

!!!!! Total fluctuates from year to year depending on new contracts/acquisitions. Core refresher training and other programmes delivered as scheduled.

!!!!! Reduction in number of major schemes completed resulted in less waste being generated. Consistent reporting systems providing more reliable results.

194,827

468,247

1,079,770 698,215

699,311 699,311

78.2

90.4

93.3

90.9

92.3 92.3

31,600

203,872

255,813

759,354

1,527,565 !!!!!

1,527,565

59,544

66,994

66,995

107,050

Improved sourcing of secondary aggregates and materials has been sustained and the reporting process has also been strengthened.

137,326 !!!!!

137,326 44,057,533 !!!!! This is a new indicator based on provisional data. Procedures are being put in place to improve the measurement and monitoring of water usage.

!!!!! Reversed fall in 2009 and made good progress towards 2012 target of 95%.

New reporting systems resulting in sharp changes as the reliability of the data improves.

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Section

7

EUROVIA GROUP

INDICATOR DESCRIPTION

Sustainable products

Products designed with particular environmental benefits

ULM

Thin surfacing with reduced aggregate content (tonnes)

Ultraphone

Thin surfacing with additional noise reduction benefits (tonnes)

Fibrovia

Thin surfacing with additional recycled content (tonnes)

Low-carbon products

Sustainable products with a significant carbon-saving benefit

Foambase

Cold asphalt with high recycled content (tonnes)

Tempera

Warm asphalt product providing energy savings (tonnes)

Gripfibre

2004

2005

2006

2007

2008

2009

2010 2010

TREND

69,999

142,004

134,654

66,263

95,104

55,305

65,020 65,020

!!!!!

293

1,073

458

262 262

9,632

32,170

80,015

53 53,212

5,230

10,000

25,941

29,000

!!!!!

00

!!!!! Disappointing take-up of low-carbon solution since 2009 launch.

!!!!! Previous years' figures have been re-calculated to correct anomalies in conversions from square metres to tonnes.

Yearly variations reflect market conditions and other factors, as per sustainable products (see above). !!!!!

14,973

15,190

11,887

17,296

16,807 16,807

Griptex

Standard microsurfacing product using cold technology (tonnes)

21,372

22,100

23,400

26,156

31,720 31,720

LED signs

LED-illuminated signs using low voltage or renewable power (units)

10

250

190 190

OBJECTIVE Our Business Achieve pre-tax profit – by 2013 A A Achieve return on capital employed – by 2013 Reduce days sales outstanding – by 2013 MIncrease Group average EFQM score (from 2009 baseline) by 2013 M Maintain accreditation of The Way We Work management system and register new contracts and acquisitions to ISO 9001, ISO 14001 and OHSAS 18001 within 18 months

!!!!! Yearly variations reflect the specifications chosen by clients; 2010 level is a function of the reduction in turnover.

8,1 8,175

1,851

High-performance microsurfacing product using cold

!!!!! Highway authority budget cuts and financial uncertainty have hampered take-up despite widespread recognition of the range's value following successful trials.

New range being developed will boost performance, whole-life and low-carbon benefits further.

Our performance (continued) Negative trend Positive trend No or little change/ new parameter Cannot be coded as reflects nature of business/tender succcess

Climate change Scope 1&2 carbon footprint

Emission intensity Car miles saved by VC/TC

Car miles avoided through video/teleconferencing

Flight miles saved by VC/TC

Flight miles avoided through video/teleconferencing

Hours saved by VC/TC Tonnes of CO2e saved by VC/TC

Travel time avoided through video/teleconferencing Tonnes of carbon dioxide equivalent greenhouse gas emissions avoided through video/teleconferencing

Community and charity Number of volunteering days Money raised for donations Materials donated locally Business Excellence EFQM results

34

Carbon footprint calculated for the Group (re-stated to exclude joint ventures) as equivalent tonnes of carbon dioxide for all greenhouse gas emissions (CO2e) in 2009 and 2010; CO2 (carbon dioxide emissions only) in 2007 and 2008 Tonnes of carbon dioxide equivalent greenhouse gas emissions per £ million turnover (excluding joint ventures) 2,960

0.8

73,164

18.6

32,033

31,401

33,035

36,751 36,751

96.4

91.5

99.3

96,563

86,015

92,166

124.0 124.0 84,623 84,623

2,562

2,612

3,444

1,257

1,981

1,944

2,025

14,656 14,656 1, 1,986

28.3

38.6

34.5

37.2

38 38.6

111,403

Person-days worked on community projects or for registered charities by Group employees Value (£) of funds contributed by the company and its employees to good causes Value (£) of materials provided at no charge to community projects

Averaged score for Group from assessments of business units against Business Excellence Model

287.0

317.5

351.3

343.7

83

147

116 116

5,568

12,573

19,878

23,757

14, 14,187 23, 23,771

425.1

422.3

452.0

P P Progress in 2010

!!!!! Yearly variations reflect the specifications chosen by clients; 2010 level is a function of the reduction in turnover.

13,475

technology with modified polymers and fibres (tonnes)

CR targets

COMMENTARY

Reduction in scale of operations more than offset by impact of severe winter, resulting in increased gritting runs, lower fuel efficiency, and higher energy consumption in asphalt production.

Switch to CO2e measure of all greenhouse gas emissions (with higher conversion factor for gas oil) also increased totals compared with 2007 and 2008. !!!!!

Accuracy of reporting continues to improve. !!!!!

!!!!! The change is a function of the reduced number of employees in 2010. !!!!!

!!!!! Reporting procedures continued to improve in 2010 !!!!!

!!!!! Reflects under-reporting is the main factor.

TheArrangements figure is for head office to staff only. Arrangements in place to improve record-keeping in divisions.

Reflectsreduction reductionininworkforce, workforce,but but under-reporting is the main factor. in place improve record-keeping in divisions.

Excludes £2,432 donation to road safety charity Brake made after year-end. Overall level of contributions maintained despite loss of personnel and tough trading conditions. !!!!! Community Committee is encouraging managers and employees at all levels to get involved in more activities in 2011. !!!!!

!!!!!

Return to upward trend following first-time assessments of several business units in 2009 and ongoing programme of improvements across Group

35

TARGET

PROGRESS

5%

Pressure on margins and turnover depressed performance during year but cost savings and new orders Pressure on margins and turnover depressed performance during year but cost savings and new orders left Group in strong commercial position at year-end left Group in strong commercial position at year-end

15% 7% increase represents rapid A higher has been set for (seedue page ToBy<>5510% days Target not achieved in 2010, butprogress.

Group is on coursetarget to hit revised target of <2013 60 days to 37) fast close By > 10% 7% increase represents rapid progress. A higher target has been set for 2013 (see page 37) By > 10% 7% increase represents rapid progress. A higher target has been set for 2013 (see page 37) All business units

Accreditation levels sustained and Group registration achieved, increasing consistency across business units as divisional certification integrated and transferred by BSI

Our People Reduce lost-time incident frequency rate (LITFR) in 2010 Eliminate incidents notifiable under the Reporting of Injuries and Dangerous Diseases & Occurrences Regulations (RIDDOR) in 2010

Zero

Decrease voluntary labour turnover by 2013 Provide placements or employment across Group to disadvantaged persons in 2010

To 15% 50% of units

Yearly comparisons distorted by end of major contracts and reduction in workload.

Targets have been reformulated and revised targets set for 2010-2013 (see page 37)

To < 2.5

Steady long-term decline in both indicators reversed for first time. Underlying factors analysed through a safety climate survey and divisional-level investigations. Each division setting priorities for action to return rates to downward trend

Our Environment Increase the proportion of waste we divert from landfill – by 2012 Reduce the Group carbon footprint year on year (based on parent company Eurovia SA calculated Scope 1 & 2 performance for 2008)

To > 95%

92.3% achieved, representing good progress towards target

By 5%

Performance against this measure has not yet stabilised due to ongoing changes and improvements in reporting. Severe winter season and economic climate are also factors. LCSC facing up to challenge to deliver carbon reduction across business

Roll out carbon strategy by end 2010 Reduce fuel consumption of each business unit by 2013

All units By 10%

Developed in 2010 and launched early 2011, the strategy is now being promoted internally and to clients Systems for recording and reporting fuel use are being reviewed and will be standardised to provide more robust data Group-wide

Our Communities Increase total number of volunteering days in 2010

By 10%

21% decrease largely due to under-reporting in divisions.

Reduction in workforce lowered base level of volunteering. Renewed commitment to target in 2011

Increase the value of money and support in kind raised for community and charitable causes across each business unit in 2010 Join the BITC CR index and achieve a high benchmark score for the Group by 2010

By 10% > 75%

4.5% increase in giving fell short of target due to tough trading conditions and reduction in personnel.

Re-committed to target in 2011 This target was achieved with an initial 75% (Bronze) score for 2009, followed by strong improvement in 2010 to 83% and Silver status

36

Our structure

2010

TREND

65,020

!!!!!

262

!!!!! Yearly variations reflect the specifications chosen by clients; 2010 level is a function of the reduction in turnover.

53,212

!!!!!

CR targets

COMMENTARY

8,175

!!!!! Yearly variations reflect the specifications chosen by clients; 2010 level is a function of the reduction in turnover.

0

!!!!! Disappointing take-up of low-carbon solution since 2009 launch.

16,807 31,720

!!!!! Previous years' figures have been re-calculated to correct anomalies in conversions from square metres to tonnes.

Yearly variations reflect market conditions and other factors, as per sustainable products (see above). !!!!!

190

!!!!! Highway authority budget cuts and financial uncertainty have hampered take-up despite widespread recognition of the range's value following successful trials.

36,751

FIT FOR PURPOSE: We have restructured our Group to promote our two core business streams – the Term Services provided by Ringway, and our Contracting & Production activities now trading under the Eurovia brand name.

!!!!!

84,623

!!!!! The change is a function of the reduced number of employees in 2010.

14,656

!!!!!

1,986

!!!!! Reporting procedures continued to improve in 2010

38.6

!!!!!

116

!!!!! Reflects under-reporting is the main factor.

TheArrangements figure is for head office to staff only. Arrangements in place to improve record-keeping in divisions.

Reflectsreduction reductionininworkforce, workforce,but but under-reporting is the main factor. in place improve record-keeping in divisions.

Excludes £2,432 donation to road safety charity Brake made after year-end. Overall level of contributions maintained despite loss of personnel and tough trading conditions. !!!!! Community Committee is encouraging managers and employees at all levels to get involved in more activities in 2011. !!!!!

14,187 23,771

452.0

2

Reduction in scale of operations more than offset by impact of severe winter, resulting in increased gritting runs, lower fuel efficiency, and higher energy consumption in asphalt production.

Switch to CO2e measure of all greenhouse gas emissions (with higher conversion factor for gas oil) also increased totals compared with 2007 and 2008. !!!!!

Accuracy of reporting continues to improve.

124.0

!!!!!

OBJECTIVE Our Business Achieve pre-tax profit – by 2013

TARGET

PROGRESS

5%

Achieve return on capital employed – by 2013 Reduce days sales outstanding – by 2013 Increase Group average EFQM score (from 2009 baseline) by 2013 Maintain accreditation of The Way We Work management system and register new contracts and acquisitions to ISO 9001, ISO 14001 and OHSAS 18001 within 18 months

15% To < 55 days By > 10%

Pressure on margins and turnover depressed performance during year but cost savings and new orders Pressure on margins and turnover depressed performance during year but cost savings and new orders left Group in strong commercial position at year-end left Group in strong commercial position at year-end

Our People Reduce lost-time incident frequency rate (LITFR) in 2010 Eliminate incidents notifiable under the Reporting of Injuries and Dangerous Diseases & Occurrences Regulations (RIDDOR) in 2010

New range being developed will boost performance, whole-life and low-carbon benefits further.

Decrease voluntary labour turnover by 2013 Provide placements or employment across Group to disadvantaged persons in 2010 Our Environment Increase the proportion of waste we divert from landfill – by 2012 Reduce the Group carbon footprint year on year (based on parent company Eurovia SA calculated Scope 1 & 2 performance for 2008)

Return to upward trend following first-time assessments of several business units in 2009 and ongoing programme of improvements across Group

35

Progress in 2010

All business units

To < 2.5 Zero

Target not achieved in 2010, but Group is on course to hit revised target of < 60 days due to fast close 7% increase represents rapid progress. A higher target has been set for 2013 (see page 37) Accreditation levels sustained and Group registration achieved, increasing consistency across business units as divisional certification integrated and transferred by BSI

Steady long-term decline in both indicators reversed for first time. Underlying factors analysed through a safety climate survey and divisional-level investigations. Each division setting priorities for action to return rates to downward trend

To 15% 50% of units

Yearly comparisons distorted by end of major contracts and reduction in workload.

Targets have been reformulated and revised targets set for 2010-2013 (see page 37)

To > 95%

92.3% achieved, representing good progress towards target

By 5%

Performance against this measure has not yet stabilised due to ongoing changes and improvements in reporting. Severe winter season and economic climate are also factors. LCSC facing up to challenge to deliver carbon reduction across business

Roll out carbon strategy by end 2010 Reduce fuel consumption of each business unit by 2013

All units By 10%

Developed in 2010 and launched early 2011, the strategy is now being promoted internally and to clients Systems for recording and reporting fuel use are being reviewed and will be standardised to provide more robust data Group-wide

Our Communities Increase total number of volunteering days in 2010

By 10%

21% decrease largely due to under-reporting in divisions.

Reduction in workforce lowered base level of volunteering. Renewed commitment to target in 2011

Increase the value of money and support in kind raised for community and charitable causes across each business unit in 2010 Join the BITC CR index and achieve a high benchmark score for the Group by 2010

By 10% > 75%

4.5% increase in giving fell short of target due to tough trading conditions and reduction in personnel.

Re-committed to target in 2011 This target was achieved with an initial 75% (Bronze) score for 2009, followed by strong improvement in 2010 to 83% and Silver status

36

Objectives & targets OBJECTIVE Our business Achieve target pre-tax profit – by 2013 Achieve target return on capital employed – by 2013 Reduce days sales outstanding – by 2013 Increase Group average EFQM score – by 2013 (from 2010 baseline) Maintain accreditation of The Way We Work management system and register (within 18 months) new contracts and acquisitions to ISO 19001, ISO 14001 AND OHSAS 18001 Combine EFQM assessments and compliance audits in an integrated programme Assess the new social responsibility standard BS ISO 26000 and develop an implementation plan Assess EN 16001 and develop a proposal for the new energy management standard Improve reporting of environmental data Our people Reduce lost-time incident frequency rate (LTIFR) in 2011 Eliminate incidents notifiable under RIDDOR in 2011 Decrease voluntary labour turnover Provide placements or employment to disadvantaged persons across the Group over the period Provide employment and training opportunities for young people through apprenticeships

2011 - 2013 TARGET

WHY

4% 15% To < 60 days By 15% All business units

To sustain usiness development and growth, satisfy our shareholders, and To sustain business development and growth, satisfy shareholders, and maintain a robust, sustainable approach to fiscal management

By end 2011 By end 2011 By end 2011 During 2011

To target internal auditing and to aid improvement action planning To ensure we follow best practice in corporate social responsibility To ensure we follow best practice, reduce carbon footprint and energy use To maximise accuracy and verifiability, and inform stakeholders and regulators

To improve the business continuously To ensure we do small things consistently well, manage risks and seize opportunities

Eurovia Group UK Albion House Springfield Road, Horsham West Sussex RH12 2RW www.ringway.co.uk Feedback to: Tracey Elms, Group Marketing and PR Manager.

E: Tracey.Elms@Eurovia.co.uk

To < 2.5 Zero Year on year In 50% of business units Sustain annual intake

To protect those we work with and around, and to reduce days lost through injuries To protect those we work with and around, and to reduce days lost through injuries To increase productivity, job satisfaction and morale To reduce social exclusion, contribute to communities and local authorities’ strategies To invest in local communities, avoid skills shortages and develop our future workforce

Our environment Reduce the Group’s carbon footprint year on year (based on Scope 1 & 2 performance as calculated for 2011) Implement Group’s Carbon Strategy Reduce fuel consumption of each business unit by 2013 Increase the proportion of waste diverted from landfill – by 2012 Reduce the number of environmental incidents in 2011 from 2010 level Eliminate environmental incidents resulting in prohibition notices or prosecution Develop a water use monitoring system and water footprint baseline for 2011

By 5%

To reduce impact on the environment and to build a low-carbon business

By end 2011 By 15% To > 95% By 30% Zero By 2012

To minimise contribution to climate change and build a low-carbon business To reduce energy use and environmental impact and maximise energy efficiency To reduce waste of natural resources To protect the environment and minimise the impacts of our operations To protect the environment and minimise the impact of operations

Our communities Increase the total number of volunteering person-days in 2011 Increase value of money and support in kind raised for community and charitable causes in 2011 Maintain the Group’s benchmark score and Silver status in BITC’s CR Index

By 10% By 10% To 2013

To boost the contribution we make to communities and enhance employees’ job satisfaction, skills and team-building through creative partnerships

Printed on 9lives paper – 80% post-consumer recycled fibre; 20% totally chlorine-free pulp, sourced from well-managed forests and controlled sources, manufactured by ISO 14001-certified mill.

Report produced by Silke & Co: www.silke.co.uk Design by Tom Thompson Design: www.tomthompsondesign.co.uk

To conserve an increasingly scarce resource

To drive improvement in how we measure CR activities and performance

37

Corporate Responsibility 2010 Report

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