Corporate Responsibility

The Board is committed to Corporate Responsibility and the need to take proper account of our impact on the environment, the morale and welfare of our employees and the satisfaction of our customers. We have a duty to our shareholders to consider all social and environmental issues that could affect our business.

We have developed a formal Business Conduct policy which articulates our values and approach to our stakeholders and this is available on our website (www.bssgroup.com). Operational responsibility lies with the Group's Executive Committee and day-to-day responsibility for the compliance with the Business Conduct policy lies with the Group Chief Executive.

Health and Safety

Health and safety is a key issue for the Group. We are committed to ensuring the health and safety of our employees, customers and visitors to our sites. The Group Chief Executive is the Board member responsible for health and safety matters including keeping the Board informed at each meeting. Our in house Health and Safety ("H & S") Department has three H & S Advisors and one H & S Assistant, who provide advice and support to operational management and staff at all levels and who monitor the implementation of the Health and Safety Policy and Procedures. The Policy document and branch manual is regularly updated to ensure that it accurately reflects our businesses.

Over the past year we have:

Reduced our rolling 12 months manual handling accidents by 38%
Maintained an ongoing training programme for all levels of employees in line with H & S Policy requirements
Provided 3,445 training days during the year
Continued to undertake regular and extensive H & S audits of our management systems and inspections of our branch, warehouse and office based activities
Reviewed all audit, inspection and accident report findings and produced action plans to ensure continual improvement in our management of Health and Safety
Investigated all reportable (RIDDOR) accidents notified to us and implemented changes to procedures where appropriate
Responded positively to any findings / observations by the local authority following inspections and
Continually assessed, maintained, monitored and improved safety performance

There have been no prosecutions by the Health and Safety Executive or enforcement actions during the calendar year 2006.

Employee Involvement and Working Environment

The importance of good relations and communications with employees is fundamental to the continued success of our Group. The Group Chief Executive is the Board member responsible for human resources matters and updates the Board on a regular basis. Divisional newsletters are published regularly to employees to ensure they are kept well informed. Annual employee attitude surveys are conducted to measure employee motivation and provide an additional feedback facility for employees to communicate with the Group. The Group makes various benefit schemes available to all employees (subject to eligibility) including a SAYE ("Save As You Earn") Scheme. A benefits website has recently been launched with benefits ranging from retail vouchers to reduced theme park entry fees and concessions on gym membership.

We aim to maintain a progressive equal opportunities policy to ensure equal treatment for all irrespective of race, creed, colour, nationality, ethnic origin, age, language, religion, sexual orientation, gender or disability. Individuals are trained, developed, promoted and treated on the basis of their relevant aptitudes, abilities and skills. We recognise that everyone is different and by valuing diversity we appreciate that people with different experiences, views, opinions and approaches can bring important skills to the Group.

BSS and the Community

We conduct all our business with honesty and integrity and are a responsible member of the community.

In February 2006 our Domestic Division, PTS, announced a two year partnership with Age Concern with the aim of our employees raising £150,000 to provide vital support for older people. Several events ranging from "Back to the Floor" (in which senior management work alongside branch/warehouse staff and drivers), sponsored raft race, 350 mile cycle ride challenge, donating 1% of the proceeds from certain product sales to participating in the Great North Run have raised nearly £100,000 so far. In addition, support is provided to The Women in Plumbing organisation.

Our Industrial Division started a year long partnership with the children's charity, The Rainbow Trust, in January 2007, to enable employees to get involved and help raise funds to reach the target of £50,000. The aim of this initiative is to make it possible for families to stay at The Rainbow Trust's respite houses.

Our employees, also held fund raising events during the year for Great Ormond Street Hospitals' "Jeans for Genes" Appeal, Red Nose Day and Breast Cancer Awareness, which the Group fully supported.

The Environment

We recognise the importance of responsible environmental management and the obligation to protect the environment. In particular we focus on:

Minimising the use of energy, water consumption and emissions
Seeking opportunities to minimise waste produced in all sections of the business
Complying with all relevant environmental legislation, regulations, standards and other relevant codes
Providing, where possible, the most efficient solutions for heating and pipeline processes
Working with our suppliers towards ensuring effective environmental supply chain management
Reviewing and managing our transport supply chain including investigating the use of energy efficient vehicles
Where able to do so, specifying commercial vehicles that meet Euro V emission standards, a standard that does not come into force until 2009
Evaluating route optimisation software designed to reduce the mileage driven and
The successful conclusion of a pilot project allowing remote monitoring of electricity, gas and water usage at sites indicated where usage reductions can be achieved. As a result remote monitoring is being introduced in all sites above a certain size

We recognise that waste and emission output are our most significant environmental impact and are able to report that:

During the year we have achieved a net average reduction in vehicle emissions across the commercial fleet:
- average 0.10 g/kWhr reduction on Carbon Oxide per vehicle
- average 0.13 g/kWhr reduction in Nitrogen Oxide per vehicle
- average 0.03 g/kWhr reduction in Particulate Matter per vehicle and
In the calendar year 2006 we recovered and recycled 5,711 tons of waste through an approved supplier

We had no prosecutions relating to environmental matters during the year. This reflects in part the fact that as a distributor, our activities generally have a lower impact on the environment but also our proactive approach when planning and developing new branches.

In January 2007 PTS opened a Green Energy Room in Nottingham and two further locations are planned in the North and South. The Green Energy Room offers advice to make an informed choice about being environmentally responsible and cutting household bills when considering heating and plumbing options. Currently PTS offers a range of energy efficient products and emergent renewable technologies.

Renewable energy options such as solar panels are considered and installed at new branches subject to landlord's consent and favourable physical conditions of the building. In addition we are now using and monitoring "intelligent lighting" systems in branches to reduce power usage. Intelligent lighting turns warehouse lights off automatically in areas which are not used for period of time.

Our reporting systems are also being developed and strengthened in 2007 so that we can collect more detailed data and develop appropriate performance targets.