Stakeholder engagement and material themes
BAM recognises that real business benefits can only be achieved by involving all stakeholders. BAM therefore continuously engages with its stakeholders in all home countries and throughout all operating companies to understand their priorities and concerns through benchmarking, sector meetings, client surveys and direct contacts.
The Group has defined its stakeholders as those groups which significantly influence or are influenced by the economic, environmental and social performance of BAM.
BAM is in daily conversation with its clients about project expectations and projections. In addition, BAM organises client meetings to share knowledge, best practices and innovation within its value chain. Maximum value for money is of utmost importance to the clients and this extends beyond simply delivering a project at the lowest price. On all its projects, BAM tries to exceed clients’ sustainability expectations or to suggest an enhanced approach where none exists or where no targets have been set.
Providers of financial capital
Communication with investors, financial institutions and the financial community at large is actively pursued and usually takes place through meetings, project visits, road shows, seminars, presentations, investment meetings and press releases. The main recurring topics of discussion are financial performance, transparency and control.
As part of the performance management process, personal learning and development plans of employees are evaluated annually between manager and employee. Progress to meet annual targets together with personal growth and career development are discussed. BAM has active works councils within the operating companies to discuss organisational changes and other employee related matters. Employee engagement is facilitated through multiple platforms such as Young BAM events, open collaboration days, senior management meetings and online surveys through BAM Panel. In those events BAM aims to share learnings from projects, inspire employees with new ideas and collect feedback on what can be improved.
Suppliers and subcontractors
Supply chain partners are essential to BAM and therefore the Company engages with almost all of its suppliers. At the project level, BAM is in daily conversations with its suppliers about project expectations and the carbon footprint of supplied goods. In 2019, BAM increasingly engaged with suppliers to reduce the environmental impact of projects by implementing lifecycle assessments on product level.
By their nature, the construction and civil engineering works of BAM have an impact on local communities. BAM builds facilities which society needs, such as housing, hospitals, schools, leisure and industrial facilities, utilities and infrastructure. Discussion points differ per governmental body, but health and safety as well as human rights are common. Chapther Social performance of this report describes BAM’s results and provides examples of its activities for social involvement in 2019 . BAM’s programme on enhancing lives shows its ambition to increase its positive impact on local communities.
By delivering projects, BAM is in constant contact with (local) government authorities about issuing permits, compliance with regulations and monitoring of activities. BAM is involved in many governmental initiatives including several Green Deals throughout Europe. The Group aims to engage regulators in issues such as health and safety management, carbon-free buildings, carbon impact in the infrastructure lifecycle and other sustainability related issues within the built environment. An example is platform CB23, which BAM joined in 2019, whose goal it is to develop and implement circular building regulations for the entire Dutch construction industry by 2023.
For BAM, stakeholder engagement is about transparancy, a deeper understanding of requirements and expectations and, ideally, future-proof partnerships in the supply chain. During 2019, 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.
In 2019, BAM engaged in discussions around the following themes: smart cities and mobility, circular economy, healthy urban living, lifecycle values, energy transition and digital construction. These themes are all societal challenges that no single party in the value chain can solve on its own. Tackling these challenges requires cross-sectoral collaboration, which can only be achieved if organisations and people from different sectors are willing and able to think, learn, communicate and collaborate across the boundaries that used to divide them.
Sustainable Development Goals
BAM values alignment of its strategy with regard to 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 believes it has a moral obligation to support 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.
To that end BAM has identified seven goals that fit its strategy and impact best:
3 – Good health and well-being
4 – Quality education
8 – Decent work and economic growth
9 – Industry, innovation and infrastructure
11 – Sustainable cities and communities
12 – Responsible production and consumption
13 – Climate action
The link between BAM’s performance indicators, material themes, risks and the SDGs is explained in
figure 4 (scroll down).
In June 2019, BAM International organised a sustainable development goals kick-off event. Members of its senior management each championed a single SDG and during the event they got together with employees to come up with objectives and initiatives per goal. BAM International has since implemented a number of these initiatives, such as embedding a carbon and waste measuring tool into its tender process and additional vocational training sessions on its projects. The development and implementation of sustainable initiatives is ongoing.
The Group is exploring to organise similar events in other BAM operating companies and business units to ensure a dialogue around the SDGs with different stakeholders. In this way, the SDGs can be integrated with BAM’s sustainability ambtion and its way of working. Currently, BAM does not explicitely monitor its impact on the SDGs. Suitable KPIs to monitor the Company’s contribution to these goals will be a discussion point in the process towards a strategic agenda for 2021-2025.
As part of the development of the strategic agenda for 2016-2020, the Group carried out a materiality assessment in which twelve material 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. A detailed description of the twelve material themes, their impact on BAM and the management approach can be found in can be found in Material themes and management approach. The materiality matrix (figure 3) displays the prioritisation of the matters based on their relative importance to BAM, to its stakeholders and to society.
3 - Materiality matrix
Compared to the previous year, BAM sent out an extended stakeholder survey in 2019. The Group performed an analysis and looked at peers in the construction industry and leading companies in integrated reporting to further identify relevant market trends. Seven topics that were considered material themes in other companies were selected and added to the survey. The materiality matrix below shows the ratio and priorisation between the current twelve and the seven newly identified themes. Of these new themes, risk management and digitalisation appear important and have a high impact on BAM and its stakeholders. Climate adaptation, business disruption and diversion and inclusion have a limited impact. Biodiversity and geopolitical events appear less important for BAM and its stakeholders. Currently, BAM does not monitor its impact on the seven new themes with KPIs since these are not part of its current strategic agenda. The prevailing twelve remain material.
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 risk management and digitalisation since these are important for BAM’s long-term value creation. A detailed description of BAM’s approach and 2019 strategic initiatives on risk management can be found in Risk management. The approach to digitalisation can be found in the paragraph Value creation > Strategy. Another main conclusion of the process was to use the outcome of the 2019 stakeholder engagement (nineteen identified themes) as an inspiration for BAM’s upcoming strategic agenda 2021-2025 process and the product-market combination discussions to be held in 2020.
Most material themes
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. The most relevant theme for the client group was project and product quality and control. The employee group specifically indicated financial performance and project and product quality and control as the most material themes. Providers of financial capital indicated that BAM’s financial performance is most relevant to their organisations, in addition to risk management. BAM’s subcontractors and suppliers as well as the group representing society in general (NGOs, government and knowledge institutes) specifically indicated innovation and sustainable procurement as material themes. Additionally, 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 supply chain integration and networking economy, building information modelling (BIM) and health and well-being.
4 - Link between performance indicators, material themes, risks and SDGs
* For paragraph numbers please check the PDF file.