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FY22 was a strong year for delivery against our Environmental, Social and Governance ("ESG") agenda.
Building on the strategy work that we undertook last year, we are pleased with the strong progress that we have made this year. As the regulatory landscape continues to evolve in response to climate change, supply chain transparency and corporate due diligence, we remain committed to evolving our approach and ensuring we have a sustainable business that delivers for all stakeholders.
Our approach to sustainability focuses on the ESG areas that are most important to our stakeholders and to our long-term business success. Our ESG agenda is aligned to the Group’s strategy ‘To Inspire and Support a Lifetime of motoring and cycling’ and also forms a strong part of our culture, recognising we all have a role to play in delivering against our commercial ambitions as well as minimising our impact on the planet.
Following a process of stakeholder engagement and materiality assessment, our priority areas have been identified as:
The leading name in electric services giving everybody the confidence to switch and continually enjoy the benefits of electric mobility.
Achieve Net Zero value chain emissions by 2050 and interim reductions aligned to science-based principles.
Make Halfords a truly inclusive place to work and representative of the customers and communities we serve.
Minimise our environmental impact and increase our transparency whilst continuing to pursue sustainability opportunities within our product portfolio.
Working with consultants from PwC, we conducted a materiality analysis, looking at the interests of various stakeholder groups, including colleagues, investors and the industry, to identify which ESG issues were of most importance. Then, incorporating insight from colleagues, these issues were ranked to assess which were most material to the business.
Whilst we have prioritised four areas for our key focus, we continue to manage the other listed ESG issues as ‘business as usual’, which remain important in the delivery of our overall ESG ambitions. Further information on the progress made against our ESG agenda this year can be found on the following pages.
Our priority areas are underpinned by our commitment to operating responsibly. We have clear policies that ensure a consistent approach to the standards of operations and behaviours we expect from our colleagues and business partners. These policies include, but are not limited to, health and safety, environmental management, global sourcing code and data protection. Colleagues are required to complete mandatory learning to ensure policies are well understood and are actively encouraged to speak up without fear of reprisal should they believe these policies are not being adhered to and/or misconduct is taking place.
The ESG Committee comprises Non-Executive Directors and is a committee of the Board. Further information on the Committee's main responsibilities and activities undertaken during the year can be found in the ESG Committee Report.
The Executive Team is ultimately responsible for the day-to-day management of the ESG programme. Whilst ESG is regularly discussed at Executive meetings, recognising the importance of ESG, we have chosen to form an ESG Board comprising Executive members giving a dedicated monthly session to focus on strategic progress of our ESG programme. The ESG Board formally commenced in Q1 FY23.
With the formation of the ESG Board, we paused the previously reported ESG Steering Group towards the end of the financial year. The ESG Steering Group, which comprised functional leaders, met monthly throughout the year and was responsible for monitoring progress against our priority areas of focus, discussing external trends as well as sharing performance updates to the Transformation Board. The new ESG Board will review terms of reference for the ESG Steering Group in the new financial year to ensure we remain adequately positioned to deliver against our ESG strategy and priorities.
During this financial year, executive remuneration is linked to our performance in our Electric Services training target. We're pleased to have met this target which accounted for a portion of executive remuneration in FY22.
