Stakeholder engagement and material themes
Stakeholder engagement at BAM
BAM recognises that real business benefits can only be achieved by involving all stakeholders. BAM continuously engages with the stakeholders in its markets and throughout all operating companies to understand their priorities and concerns through benchmarking, sector meetings, client surveys and direct contacts.
For BAM, stakeholder engagement is about transparency, a deeper understanding of requirements and expectations and, ideally, future-proof partnerships through the supply chain. During 2021, BAM engaged in several stakeholder dialogues to address cross-industry trends and movements throughout the entire construction value chain, for example during yearly supplier days at different business units. Similar as in 2020, engagement activities mostly continued in smaller groups and through digital meetings.
BAM’s stakeholders are interest groups which significantly influence or are influenced by the economic, environmental and social performance of the Company. BAM identified six key-stakeholder groups. These groups as well as typical type of engagement are described below:
Maximum value for money is of utmost importance to BAM’s clients and this extends beyond simply delivering a project at the lowest price. BAM is in constant dialogue with its clients about project expectations and projections. In addition, BAM organizes client meetings to share knowledge and best practices - this is primarily done through account management and business development.
Providers of financial capital
Engagement with investors, financial institutions and the financial community at large is actively pursued and usually takes place through road shows, seminars, investment meetings and press releases. The main recurring type of engagement is related to financial performance, transparency and control.
Employees are BAM’s most valuable assets. Employee engagement is facilitated through multiple platforms such as Young BAM events, open collaboration days, senior management meetings and online surveys through BAM Panel. Additionally, BAM has active works councils across the business to discuss organizational changes and other employee-related matters.
Suppliers and subcontractors
Supply chain partners are essential to BAM and therefore the Company engages with almost all of its suppliers. At projects, BAM is in constant dialogue with its suppliers about project expectations and the carbon footprint of supplied goods to reduce the environmental impact of our projects.
BAM builds crucial facilities which society needs, such as housing, hospitals, schools, utilities and infrastructure. By their nature, the construction and civil engineering works of BAM have an impact on local communities. BAM’s engagement through projects is typically focused on topics like local spend and creating positive social impact through volunteering.
By delivering projects, BAM is in constant contact with (local) government authorities about issuing permits and compliance with regulations. BAM engages with regulators in issues such as carbon-free buildings, carbon impact in the infrastructure lifecycle and environmental issues like climate change.
Stakeholder engagement in 2021
At the end of 2021, Royal BAM Group carried out a materiality assessment in which 18 themes were identified. Material themes significantly influence BAM’s ability to create value in the short, medium and long term. In order to be able to update the materiality matrix.
BAM distributed an online survey to international stakeholders across all six stakeholder groups, selected with support from regional business development contacts to determine relevant stakeholders. Based on this input, BAM identified seven material themes. A detailed description of the seven material themes, their impact on BAM and the management approach can be found in paragraph 9.7.
BAM sent out a stakeholder survey in 2021, including a broad definition of the themes for complete cover. The materiality matrix (figure 4) displays the prioritisation of the themes based on their relative importance to BAM, to its stakeholders and to society. In addition to closed questions, the stakeholders were requested to introduce and assess matters that they felt were missing in BAM’s original materiality assessment. Topics raised by stakeholders included energy transition and BAM’s solution to the shortage of affordable housing.
The Executive Committee was involved in the engagement process and the discussion on the materiality of these themes. The discussed approach with the Executive Committee was to specifically report on the seven most material themes as these are important for BAM’s long-term value creation. An ambition discussed with the Executive Committee during last year’s stakeholder engagement was to use the output of the assessment as an inspiration for the new strategic agenda process. In 2021 specifically, the input was used for development of the upcoming sustainability strategy and to define (future) market risks and opportunities for BAM.
Material themes in 2021
Stakeholders identified and prioritised the potential impact of (material) themes on themselves and on society. The prioritisation of BAM’s material themes remained very similar compared to last year. Financial performance and project and product quality and control remained the most important themes for BAM. The planet themes decarbonisation and circularity both became more material in 2021’s assessment.
The most relevant theme for the client group was project and product quality and control. Providers of financial capital indicated that BAM’s financial performance is most relevant to their organisations. BAM’s employees indicated employee recruitment, development and retention as an important theme.
BAM’s suppliers and subcontractors specifically indicated circularity and digitalisation and industrialisation as most material themes. The planet themes decarbonisation, circularity and climate adaptation were deemed most important for society.
Based on stakeholders input, BAM identified the following seven themes (figure 5) as most material:
- Project and product quality and control;
- Financial performance;
- Digitalisation and industrialisation (including cybersecurity);
- Employee recruitment, development and retention;
- Health, safety and well-being;
Three themes that were valued important by BAM’s stakeholders but are not selected as most material theme are: risk management, climate adaptation and innovation. The Group made the decision to value these three themes not as most material because of the following considerations:
- Risk management: BAM sees this as a crucial activity to manage risks in all other themes, and not as a theme in itself. BAM’s risk management approach can be found in chapter 4;
- Climate adaptation: While BAM recognises the increasing importance of climate adaptation, the theme has not yet the same urgency for BAM as decarbonisation and circularity. BAM explores to report performance towards 2022. Currently, multiple solutions and climate adaptation projects have been delivered to clients, examples are included in paragraph 3.3;
- Innovation: Innovation is an important theme for BAM and takes place across BAM’s entire business, mainly with initiatives at individual project level. BAM has not selected innovation as a most material theme because BAM considers disclosing innovation on a consolidated level not very relevant and because innovation is significantly lower on the ‘impact on BAM axis’ in the materiality matrix compared to the most material themes.
Sustainable Development Goals
BAM values the alignment of its strategy with the UN-adopted Sustainable Development Goals (SDGs): seventeen goals that serve as a roadmap to address the world’s biggest sustainability challenges and achieve a better and more sustainable future for all by 2030. BAM recognises the importance of the SDGs as a global agenda and supports these goals. BAM’s business potentially impacts all SDGs, but given the nature of its business, some have a more direct influence within current markets.
BAM has assessed to which SDGs its priority themes and targets contribute most, and has identified 8 goals to contribute to:
- SDG 7 ‘Affordable and clean energy’
- SDG 8 ‘Decent work and economic growth’
- SDG 9 ‘Industry, innovation and infrastructure’
- SDG 10 ‘Reduced inequality’
- SDG 11 ‘Sustainable cities and communities’
- SDG 12 ‘Responsible consumption and production’
- SDG 13 ‘Climate action’
- SDG 15 ‘Life on land’
BAM contributes to efficient economic growth and create safer, more secure work environments (SDG 8) by focussing on the material theme ‘Healthy, safety and well-being’. Through specific programs focussing on employee recruitment, development and retention, BAM is aiming to reduce inequality (SDG 10).
Ultimately, BAM realises solutions that contribute to sustainable urbanisation and infrastructure and flourishing communities (SDG 11) by strongly focussing on project and product quality and control and solid financial performance.
BAM industrialises and decarbonises its operations and builds more efficient and resilient infrastructure (SDG9) by a strong focus on decarbonisation and reducing its environmental footprint. BAM moves to circularity through the reduction of waste and increased use of biobased and secondary materials (SDG 12). BAM contributes to creating sustainable cities and communities by expanding its sustainable energy solutions and by developing more energy efficient operations and solutions (SDG 7).
BAM aims to deliver climate resilient solutions to its clients (SDG 13) and nature-inclusive solutions to its clients and offers biodiversity net gain strategies to help clients build assets that respect and enhance ecosystems on land (SDG 15). BAM believes that sustainable business contributes to solid financial performance, a key material theme for BAM.
While BAM does link its strategic objectives to contribution to the SDGs, BAM does not explicitly report its impact on the SDGs. Monitoring performance in relation to the SDGs requires an accurate insight in both the positive and negative impact of BAM’s operations. BAM is working towards improving the understanding of the impact of BAM’s strategic targets and performance to the SDGs but is not yet able to consolidate all negative and positive impacts.
4 - Materiality matrix
5 - Selection materials themes linking to performance indicators and risks
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