Our sustainability improvement strategy
Sustainability has always been an important part of our strategy, and we firmly believe that this focus is not just the right thing to do, but is a central enabler of the success of both the Melrose Group and the businesses we own.
The success of this approach relies on investing in performance and productivity improvements, accelerating operational developments with a strong focus on reshaping the businesses we own into new, better organisations that are operationally and financially positioned to prosper in a sustainable manner, over the longer term and for the benefit of all stakeholders. We view investing in traditionally carbon-intensive sectors as an opportunity to create meaningful change, and strongly believe that the improvements that accelerate climate transition will propel global efforts towards achieving Net Zero by 2050.
Our established sustainability governance framework helps drive longevity and credibility of sustainability performance over time as we seek to apply a long-term view and the highest standards of integrity, honesty, and transparency to any sustainability improvements we make and align them with commercial and operational success.
Value creation
STRONG SUSTAINABILITY TARGETS AND COMMITMENTS
Our ambitious Group sustainability targets and commitments seek to drive long-term success as we provide the necessary investment, guidance and support to our businesses.
Climate focused investment
By investing in operational and R&D capabilities, we drive the focus on developing sustainable and safer products to facilitate industrial transition to Net Zero. In the last three years, we have invested c.£340 million in sustainability and climate-focused R&D and new products, demonstrating our commitment to unlock climate transition.
Highly experienced management team
Our industry expertise with over two decades of management’s experience in the UK and international manufacturing arena, and a strong track record of buying and improving underperforming businesses since 2003, are a solid asset for boosting our businesses’ operational efficiency.
Our core sustainability principles:
- Respect and protect the environment;
- Continue to invest in and support our businesses as they develop products and services aligned with Net Zero;
- Promote diversity, prioritise and nurture the wellbeing and skills development of employees, and support the communities that we are part of; and
- Exercise robust governance, risk management and compliance.
Inputs
Effective governance, risk management and compliance
The Board ultimately oversees high standards of corporate governance to ensure that Melrose achieves success for the benefit of its businesses and its shareholders over the long term.
Best practices
We set a positive example by encouraging best practices and accelerating the pace of change to influence wider positive change within our businesses and their industries.
Net Zero
Our Group Net Zero Transition Plan sets out the actions we intend to take to help execute on emissions reduction targets as we seek to contribute to Net Zero by 2050.
Stakeholders
Our material Group sustainability topics are informed by regular engagement with our key stakeholders and evolve in harmony with their needs and concerns. Examples of this are our long-standing commitment to strengthening employees’ and retirees’ pension scheme arrangements, as well as the newly launched Supply Chain Management and Water programmes and policies.
Operational and commercial success
Our substantial investment focuses on operational, financial and sustainability efficiency, supported by a strong track record of improvements facilitated in businesses that we’ve owned and their operating margins by between five and nine percentage points during our ownership.
Strategic focus on sustainability
Our robust sustainability strategies and governance frameworks set our businesses up to achieving our long-term sustainability targets and unlock their potential to become leaders in their sectors.
Long-lasting contribution to Net Zero
Backed by our targeted investment in solutions that support the energy transition, our businesses are well-positioned to lead in sustainable climate-focused innovation beyond our ownership.
Outcomes
ESG ratings
A
MSCI ESG score
C
CDP Climate change score
62.5 "strong"
Sustainalytics ESG risk management score
28.3 (Medium)
Sustainalytics ESG risk rating
Reinvestment
c£340m
Spent on climate-related research and development in the last three years
Shareholder investment and gain
2.5x
Average return on equity across all businesses sold
