Protecting the environment

Balfour Beatty works systematically to prevent negative environmental impact from its activities and to improve its environmental performance at every stage of its work. The Group’s approach is structured and risk-based with formal environmental management systems, independently audited. It continues to take the necessary steps to embed environmental management systems into the business both in the UK and overseas.

The Group reviews and maintains progress by monitoring trends and performance in five specific areas. These are:

• energy use and greenhouse gas emissions;
• materials usage;
• waste and recycling;
• water consumption; and
• impact on environmentally-sensitive areas, including biodiversity.

The robustness of the Group’s environmental management systems is also measured. The Group continues to work hard to improve the quality and robustness of its data in an environment characterised by a growing and constantly changing project portfolio.

Five environmental incidents across the Group resulted in fines in the year – three in the UK, one in the US and one in Hong Kong. Corrective action has been taken in all cases.

Validation and external audit of the 2008 data will not be complete until after the date of publication of this report. Relevant data will appear on the Balfour Beatty website in May 2009 at www.balfourbeatty.com

Balfour Beatty has reduced its relative contribution to global warming by 47% over the period from 2004 to 2008 for its UK operations. The Group invests in new and emerging technologies for vehicle emission reduction. Most particularly, significant improvements have been achieved by the use of GPS and vehicle tracking systems in more economical vehicle routeing and usage. During the year, the Group further developed its understanding of the carbon impacts of its projects through their life cycle. The Group is making preparations for the introduction of the Carbon Reduction Commitment (CRC) in the UK. Under CRC, large companies will be required to report and reduce their carbon emissions from fixed site sources under a “cap and trade” scheme.

There is an increasingly systematic focus on our sourcing of materials, usage of non-renewable resources and evaluating and managing the Group’s supply chain in respect of environmental issues. For example, in 2008, 70% of all timber purchased in the UK came from managed sources, including 55% specifically from Forest Stewardship Council schemes.

The construction process typically generates large volumes of waste. Over the last six years, Balfour Beatty has raised the awareness of this problem across the business, and has improved its measurement of construction waste – aided by the use of national waste contractors who are able to provide accurate data on waste volumes and recycling.

The total amount of waste disposed in 2008 across our UK operations was 17.5% lower than in 2007 at 126 tonnes relative to £m sales. 64% of all our waste is recycled or recovered.

We continue to measure our consumption of water. Rainwater harvesting and water efficiency measures are applied across our projects.

The Group has extended its range of key indicators to include positive and negative effects on environmentally-sensitive sites and is developing its thinking on biodiversity. All operating companies have reviewed their responsibilities for contaminated land. Archaeological aspects of sites are explored thoroughly before commencement of use.