Report of the Directors
Business Review

Building a Sustainable Workforce

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Developing Our People

The expertise, know how and contributions of our people are what drives the business forward and consequently, employee development is a key element of Johnson Matthey’s strategy for future growth. We focus on having well aligned people policies and processes and on integrating our talent review, succession planning and performance and development processes to meet the long term needs of our businesses. We place continued emphasis on developing our talent globally and across our divisions and businesses.

Our people strategy is closely linked to the strategic goals of the business and focuses on providing employees with challenging and engaging jobs, opportunities to learn from colleagues in their teams, their businesses and from across Johnson Matthey, supported by high quality training and development programmes.

The 70:20:10 principle forms the basis of our strategic approach where:

We believe that it is the blend of different ways of learning that accelerates the development of our people. Line managers support the development of their staff by providing them with opportunities to apply new knowledge and skills in jobs that engage and challenge them. They coach and mentor them and provide an environment where continuous learning and collaboration is encouraged. At a group and regional level we provide a range of high quality training and formal development programmes which are closely aligned to the 70:20:10 concept. Our programmes span career foundation and management levels, seek to offer a broad understanding of the group’s businesses and give a strong base in the company’s strategy, culture and ethics. We also build in direct contact and networking opportunities with peers and senior managers. All our programmes are aimed at engaging and developing our talented people, encouraging commitment to the company and building a high level of skills, capability and confidence.

Our divisions continue to provide training and development aligned with their specific business needs. These include apprenticeship schemes, graduate development programmes, technical training, professional development, environment, health and safety training and foundation level management and leadership skills development.

Johnson Matthey is a strong supporter of apprenticeship schemes as a valuable route for training and developing new talent. Programmes operate at a number of our facilities around the world and during 2012/13 several of our businesses have continued to expand their schemes. In the UK, the company and its apprentices continue to receive recognition from government and other organisations for their commitment and contribution to apprenticeship schemes.

As our business continues to grow geographically we have expanded our employee development activities and resources on a global basis. During the year we introduced a new group level learning and development infrastructure with specialists in each region (Europe, North America, China and India) who coordinate appropriate regional training and development activities at career foundation, professional and junior managerial levels. Programmes aimed at our senior staff are coordinated globally.

In 2012/13 we launched an executive development programme with London Business School aimed at developing senior level talent and boosting their capabilities around strategy and leadership. We also launched a global training curriculum to support the group’s Manufacturing Excellence programme. The first modules have been rolled out with excellent feedback from participants.

“What Our People Say”

One of our employees shares his experience of one of the Manufacturing Excellence training modules and the benefits it has brought to his workplace.

Read more

We have continued to build our portfolio of online learning resources as an effective way of meeting the needs of a growing global workforce. During the year, web based training for employees on antibribery and corruption matters was launched globally to complement the highly targeted face to face sessions delivered by our Group Legal team. We have also developed and trialled an online sustainability awareness training programme to further build understanding and maintain momentum and this will be rolled out to all employees from early 2013/14. Since the launch of our Sustainability 2017 Vision in December 2007, employee numbers have increased by around a third. Our new online programme will provide them, and future new recruits, with a comprehensive introduction to our sustainability goals.

We are keen to expand the opportunities for coaching and mentoring for our people and have been working to raise awareness and build competency in this area. We have further developed our mentoring scheme, introduced coaching skills training for managers and are now incorporating coaching into our leadership development programmes.

On a regional level, two major programmes were launched in China this year. Our ‘GO JM’ business awareness programme (where GO stands for group orientation) and our China Leadership Development Programme are both aimed at developing our key people in this important growth market, equipping them with core skills and developing their understanding of Johnson Matthey’s culture and values.

“What Our People Say”

Further details of our programmes in China, including one our employee’s experience of GO JM.

Read more

The coordination of people activities in India is also making very good progress and is helping to build further links between our Indian sites. Our India Leadership Development Programme is now well established and is addressing development needs of key employees. In North America we completed a learning needs analysis to identify business priorities and common requirements. This will form the basis for a regional learning and development strategy which will be implemented during 2013/14. In the UK we have continued to provide high quality career foundation and skills training aimed at our scientists, new graduates and those with leadership potential.

The geographical diversity of our employee base and skill shortages, in particular for technical leadership skills, are key challenges for us. In addition, we recognise that the expectations of our existing and prospective employees with regards learning and development opportunities are changing. We are meeting employees’ needs through more structured development programmes that build on our strong track record of promoting from within. We also continue to invest in our learning and development offering to attract and retain the best people. We are also utilising our new IT systems to enable learning and development to take place in new and different ways.

Training Days and Spend on Training

2012/13

  Total days /
shifts training
Number
of days /
shifts training
per permanent
employee
Total
training
spend
£ thousands
Spend per
permanent
employee
£
Europe 14,034 2.7 2,993 577
North America 6,123 2.1 756 256
Asia 4,514 3.2 493 348
Rest of World 2,440 4.1 157 261
Total group 27,111 2.7 4,399 433

The table above sets out, on a total and on a per employee basis, the days of training and training spend during 2012/13. The graph to the right shows the total training spend per employee over the past five years. The training spend does not include the cost of in house training or the cost of employees’ wages during training.

Whilst the overall level of formal training activity has decreased since last year (from 3.1 days per employee in 2011/12 to 2.7 days in 2012/13), the training spend per employee has increased by almost 30% reflecting a targeted, needs based and professional approach to training and development of key employee groups. Our strong and continuing commitment to the training and personal development of all our employees is reflected in the fact that during 2012/13, over 570 internal promotions were actioned. This represents 36% of all appointments made in the year.

Diversity

At Johnson Matthey we recognise the importance of diversity, including gender diversity, and the benefits this can bring to our organisation. With regard to gender diversity specifically, Johnson Matthey faces challenges similar to those faced by other organisations in the chemical, technology and manufacturing sectors.

To address these, we have policies and processes in place which are designed to support gender diversity in employee recruitment, development and promotion and we are committed to ensuring that women have an equal chance with men of developing their careers within our business. We encourage gender diversity at the early career stage by working outside Johnson Matthey to encourage women to enter scientific and industrial fields. During the year, our board of directors published a policy in respect of diversity, further details of which are presented in the Corporate Governance Report and in the Nomination Committee Report.

In accordance with applicable law, Johnson Matthey bases all employment related decisions on the principles of equal employment opportunity and our policies in this area are presented in the Governance and Sustainability section and on our website.

The group’s gender balance improved this year and was 75% male and 25% female (2011/12 78% male and 22% female). The gender balance of new recruits mirrored that of the group and was unchanged on last year at 75% male and 25% female. We have also seen an improvement in number of female employees at senior management levels as detailed in the Corporate Governance Report.

Engaging Our People

Effective two way communication with employees and, in particular, face to face dialogue, is important in embedding company culture, building commitment, celebrating achievements and increasing understanding of the business, its performance and strategy. Communication with employees is exchanged through in house magazines, attitude surveys, regular news bulletins, presentations to staff and team briefings. Employees are also encouraged to access the group’s corporate intranet, sustainability intranet and websites.

Encouraging communication between employees is becoming increasingly important as Johnson Matthey continues to expand its range of business activities and its geographic locations. Although our company operates as separate businesses within our three divisions, there are common activities and themes which run throughout the group. Further collaboration and networking will help to promote innovation, exchange of ideas and best practice, expedite research and development and support the embedding of corporate culture – all of which are important contributors in achieving our strategic goals.

We have invested in the design and development of new IT systems to enable our people to network and share their knowledge with their colleagues across the group. In November 2012 we launched ‘myJM’, a new global technology platform to create opportunities for innovation and collaboration amongst our people. The initial pilot phase, which included around 1,200 of our R&D employees, has been extremely successful. Since the launch, myJM users have between them created a virtual network of 75,000 colleague connections and published over 1,000 blogs, which have enabled them to share and discuss the latest developments across Johnson Matthey. myJM will be rolled out to the rest of our employees around the world during the summer of 2013.

“What Our People Say”

Further details of myJM, including one of our employee’s experiences of how it is benefiting her work.

Read more

We recognise and consistently see the benefits of engaging our employees in all aspects of the business and we actively provide opportunities for our people to get involved. Employees at all levels are making a major contribution to the success of our Sustainability 2017 and Manufacturing Excellence initiatives around the world. These provide very good opportunities for staff engagement and development and at the same time deliver major business improvements.

Johnson Matthey also continues to support and encourage employee share ownership to attract and motivate our people and to help align their interests with those of our shareholders. Employees have the opportunity to participate in share ownership plans, where practicable, under which they can buy shares in Johnson Matthey which are matched by a company funded component. Employees in six countries are able to contribute to a company share ownership plan or a 401k approved savings investment plan. Through these ownership plans Johnson Matthey’s current and former employees collectively held 1.85% of the company’s shares at 31st March 2013.

Johnson Matthey also sponsors pension plans for its employees worldwide. These pension plans are a combination of defined benefit and defined contribution pension arrangements, savings schemes and provident funds designed to provide appropriate retirement benefits based on local laws, custom and market practice.

Employee Relations

Johnson Matthey continues to maintain good and constructive relations with all recognised trade unions which collectively represent 31% of all group employees worldwide (2011/12 35%). The slight decrease in the proportion of represented employees is reflective of the increase in employee numbers in mainly non-unionised areas. The following table sets out the average number and percentage of Johnson Matthey’s employees who were covered by collective bargaining arrangements and represented by trade unions by geographical region in 2012/13. During the year no working time was lost within the group due to employee action.

Trade Union Representation

Average headcount 2012/13

  Permanent
employees
Represented %
represented
Europe 5,184 2,096 40%
North America 2,958 466 16%
Asia 1,416 304 21%
Rest of World 601 307 51%
Total group 10,159 3,173 31%

Apprentices at our Brimsdown, UK site celebrate National Apprenticeship Week in March 2013.

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