Sustainability remains a key element of our strategy for future growth.

Neil Carson Chief Executive

Chief Executive’s Introduction

Welcome to Johnson Matthey’s Sustainability Report.

We are now well into the third year of Sustainability 2017, a long term vision for the whole group which sets out our direction and aspirations to become a more sustainable business in the future. Through Sustainability 2017 we have set challenging targets to at least double our underlying earnings per share, achieve carbon neutrality, eliminate waste to landfill and halve the key resources we use per unit of output by 2017, the two hundredth anniversary of the company’s foundation.

Throughout 2009/10 we have continued to focus on sustainability efforts across our business and sustainability remains a key element of our strategy for future growth.

Despite facing some of the most challenging economic conditions for many years, the group performed well across all five elements of sustainability, demonstrating the continued commitment and enthusiasm for our vision from employees throughout the company.

We have continued to realise considerable savings, around £12 million, through our sustainability programme in 2009/10 and a significant proportion of profit this year was generated by environmentally beneficial products. However, growing our business through sustainability is not only about our operations and products. Protecting the health, safety and wellbeing of our employees has always been a key priority in Johnson Matthey and it is their contribution that will underpin the growth of our business in the years ahead. In 2008/09 we saw a disappointing increase in our lost time accident rate. We have taken action this year to revitalise our accident prevention processes and I am pleased to say that our rate of occupational accidents involving lost time has fallen to its lowest reported level. That said, any accident is unacceptable and we must continue to focus hard on progressing towards our target of zero accidents. We have also introduced a group target to reduce the incidence of occupational illness cases by at least 30% by 2013/14 to support and promote a healthier working environment.

While we have made steady progress in 2009/10 towards the Sustainability 2017 aspirations, much of the progress to date has been achieved by incremental improvements in operational and process efficiencies, the so called ‘low hanging fruit’. For example, as we strive to achieve carbon neutrality, we note that the group’s total global warming potential is down just 6% at 371,414 tonnes CO2 equivalent – still some way from net zero carbon. We have recognised the need to focus further on the step change opportunities that will drive accelerated progress towards our 2017 targets and add real value to Johnson Matthey. As part of this we have begun to develop a carbon neutrality strategy and our approach and thinking on this are presented as a special feature in this report.

We are increasingly focusing our R&D efforts on developing new products that will help our customers to improve their resource efficiency, reduce energy consumption and waste and make their businesses more sustainable. APICO™, our revolutionary new methanol synthesis catalyst, which was developed in house by our world class scientists, was launched to customers during the year. APICO will help to deliver many sustainability benefits to our customers in the methanol industry and is a great example of the crucial importance of R&D and innovation in building a sustainable business.

Regular followers of Johnson Matthey’s sustainability performance may notice we have changed some aspects of our report this year. The report is shorter to help highlight key issues and is supplemented by further information on the company’s website. We have also included an executive summary and a more user friendly print version to help ease reading offline. These changes have been incorporated in response to feedback received from a stakeholder survey we commissioned during the year.

Going forward, we will continue to focus on driving performance towards the Sustainability 2017 targets through identifying and implementing operational improvements and by developing new sustainable products for our customers. Despite the economic downturn, the global sustainability agenda continues to evolve at a considerable pace presenting new opportunities as well as challenges for our industry. Through our continued commitment to sustainability we aim to ensure the group is well positioned to respond and benefit over the years ahead.

Neil Carson
Chief Executive

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