Understanding the needs and priorities of our key stakeholders and building strong and positive relationships are critical to our success. Stakeholder engagement takes place across the Group, by management teams within our businesses and by the Board.
Our approach to stakeholder management
We regard our people, customers, suppliers, communities, governments and regulators, and investors as our key stakeholders. The Board maintains oversight of our engagement with stakeholders to ensure positive relationships that support the Group’s operations.
Customers
Meeting customer needs and exceeding their expectations with products, quality and service, and the way we conduct business and pay attention to the things that matter to them, is a fundamental part of our operating model and our values. Strong and enduring customer relationships will sustain Smiths into the future.
People
We aim to create an environment for colleagues based on respect, personal growth, recognition and development of talent, and a sense of belonging and purpose. Our culture is a powerful asset and empowers and enables our people to deliver our purpose.
Communities and society
Smiths products and services support critical global industries where we are pioneering progress in safety, efficiency and environmental performance. Our operations around the world play a beneficial role in local economies through job creation and skills development; procurement and generating tax revenues; operating safely, environmentally responsibly and ethically; and direct engagement.
Suppliers
Developing mutually beneficial relationships with our suppliers and building resilience, quality and efficiency across our supply chain is a fundamental contributor to our customer offer and the long-term sustainability of Smiths.
Governments and regulators
In the normal course of business, we build relationships with governments, policymakers and regulators across the world. We do this at both Group and at business levels so that we are able to operate effectively and to ensure our interests and those of the industries in which we operate are represented in decision-making.
Investors
We are committed to openness and transparency with all capital providers and to the effective management of risk. We report routinely to shareholders through formal results activities and undertake regular meetings and one-off events such as Capital Markets Days and investor conferences. Third-party analyst and broker briefings also form part of our communications schedule.
Our approach to stakeholder management
Key priorities:
- Health, safety and well-being
- Purpose and culture
- Ethical behaviour
- Reward and recognition
- Employee retention and engagement
- Talent development
- Diversity, equity and inclusion
- Sustainability
- Community contribution
Board and management engagement activities
- The Board and management engage with colleagues through regular Town Hall meetings, company news updates, and through our online tools where colleagues can share their views
- Non-executive Directors undertake workforce engagement activities, including in-person site visits and attendance at colleague meetings, forums and events
- The Board meets with colleagues of varying seniority including business teams and those in corporate functions
- Talent Roundtables are held to discuss top talent and identify potential Executive Committee successors
- Our Group mentoring scheme gives senior leaders an opportunity to have an Executive Committee formal mentor to foster the ‘developing self and others’ Smiths Leadership Behaviour
Key priorities:
- Product innovation, lead times, quality and aftermarket service
- Environmental performance of products to help customers meet their own environmental goals
- Long-term strategic relationships
- Mutual confidence and respect
- Ethical behaviour
- Data protection
Board and management engagement activities
- Management teams engage with customers through formal feedback activities such as surveys, quarterly business reviews, aftermarket service team reviews, and senior team meetings with key customers. They also integrate informal feedback from conversations had with customers by our operational and field-based teams
- Management teams use key account management structures and customer relationship management tools across our business to deliver timely and high-quality responses to our customers. We aim to apply best practices, develop skills and capabilities, and deliver continuous improvement in execution to enhance the overall customer experience
- Customers and market challenges are considered as part of the monthly business performance updates to the Executive Committee with a deep-dive every quarter
- Business performance reports including customer data and commentary are sent to the Board ahead of each Board meeting and deep-dives on business performance and strategy are held on a rotational basis
- The Board monitors performance indicators relating to customer satisfaction such as on-time-in-full (OTIF) and cost of poor quality (COPQ)
Key priorities:
- Long-term relationships with Smiths
- Mutual confidence and respect
- Ethical behaviour, meeting ESG standards
- Innovation partnerships
Board and management engagement activities
- Management teams meet regularly with suppliers to review performance, discuss new business opportunities, set goals and work on improvement areas. For our higher value and/or more complex products, management engages with our suppliers at the highest level to partner on R&D, new product introduction, quality and continuous improvement projects
- Updates on suppliers and supply chain are included in business performance updates to the Executive Committee
- Business performance reports are sent to the Board ahead of each Board meeting and deep-dives on business performance and strategy are discussed by the Board on a rotational basis. The reports include updates on suppliers and supply chain
Key priorities:
- Safe and effective operations
- Green technology, environmental performance, respecting natural resources
- Fair employment, skills development and prosperity
- Ethical behaviour
- Direct engagement – education and community support
Board and management engagement activities
- Our teams across the world engage directly with their local communities through fundraising, charitable giving and education initiatives
- Science, technology, engineering and maths (STEM) education initiatives are particularly important to management and to our colleagues as a way to share their passion for engineering and encourage young people to consider careers in the sector. Many of our sites run STEM programmes
- The Board is updated on the elements of the Group’s operations which impact the wider community, including the Group’s Global Tax Strategy. This describes our approach to the responsible management of tax affairs to enhance long-term shareholder value while contributing to public expenditure and the welfare of our local communities
- The Audit & Risk Committee receives regular reports on issues raised through the Group’s Speak Out reporting hotline which enables reporting of matters affecting communities such as safety, ethical behaviour, human rights and modern slavery
- Colleagues are regularly involved in and support local community events
Key priorities:
- Product and operational safety
- Net Zero and environmental policies
- Protection of natural resources
- Defence and security
- Safe and fair working conditions
- Economic growth and prosperity
- Trade compliance
- Ethical behaviour
- Privacy and data protection
Board and management engagement activities
- Our Government Relations team based in the UK, US, Europe and Asia guides and supports our relationships with key regulators, local policymakers, budget holders and industry groups. It also leads our outreach and relationship programme with government bodies and regulators, with the aim of promoting a deeper understanding of the Smiths culture and products. The team further enables greater access to funding both at regional and national levels, through engagement with key agencies ahead of and during funding programmes
- Government policy and regulators are considered during formulation of business strategies
- Updates on regulatory processes for approval of new products are provided during business performance reviews at the Executive Committee
Key priorities:
- Sustainable growth
- Shareholder returns
- Delivering against our strategy
- Openness and transparency
- Maintaining effective controls and managing risk
- Environmental performance and social impact
- Appropriate remuneration and incentive arrangements
Board and management engagement activities
- The Board attends the AGM and General Meetings where shareholders are invited to submit questions to the Board in person or in advance of the meeting
- The Chief Executive Officer and the Chief Financial Officer host results presentations and Q&A sessions for current and prospective investors. They attend investor conferences and meet with a broad spread of the Group’s capital providers throughout the year
- Analyst and broker briefings, and feedback following meetings with major or prospective shareholders, are circulated to Directors
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Annual Report
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S172 Statements
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Corporate governance framework
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