CSR

Sepura recognises that a positive approach to Corporate Social Responsibility ("CSR") can have a positive contribution to its reputation and the ability to create and maintain long-term value for shareholders. This is why the Board, led by the Chief Executive Officer, takes CSR seriously and is committed to advancing our related policies, systems and initiatives across all areas of the business as we continue to grow and mature. These areas primarily include ethical behaviour, concern for employee welfare, health and safety, care for the environment and community involvement.

We make considerable efforts to communicate effectively with all stakeholders who may have an interest in our CSR activities, including our shareholders, customers, suppliers, partners and employees. The Company's website is one of the main routes for providing information to interested parties and providing us with constructive feedback.

Ethical Behaviour

In support of our core values of integrity, excellence, care, teamwork and commitment, Sepura expects that its business around the world is always conducted to high ethical standards of practice and legal principles. To that end, all our employees and business partners are also expected to demonstrate high standards of professionalism and integrity at all times when conducting business on the Company's behalf. This is indeed how we behave in practice.
A Code of Business Conduct and Ethics (including a whistle-blowing policy), covering the whole of the business and our various stakeholder interests, has recently been approved by the Board and its important communication roll-out will take place shortly.

Employee Welfare

As a business driven largely by technical development and innovation, our main assets lie in the talents and skills of the people we employ. Consequently, we aim to attract, retain and motivate the highest calibre of employees, both technical and non-technical, by encouraging and rewarding high performance through competitive remuneration and incentive arrangements. Sepura is an "Investor in People" accredited employer.
Acknowledging that an environment that fosters innovation and collaboration is critical to our success, considerable efforts are made to identify and provide further learning, training and development opportunities for our employees. These are structured so as to align our organisational objectives with personal career aspirations. Formal performance reviews, including 360° appraisals, are conducted annually.
Similarly, the importance of two-way communication is recognised, particularly as it relates to the business and its performance. We actively encourage employee involvement through the recently re-profiled Staff Council and keep employees regularly informed of the Group's activities and performance through team briefings, direct access to managers and Directors at all levels, the monthly issue of a Chief Executive Officer's news bulletin and by interim and year-end presentations to all staff.

In February 2009, the Company completed its first all-employee opinion survey. This was undertaken with the purpose of seeking constructive feedback in relation to a broad spectrum of organisational, management, staff welfare and personal development issues. In consultation with the Staff Council an action plan is being formulated by management to positively address the key results of the survey.
During the year, and with a view to encouraging share ownership amongst its employees, the Company successfully launched an all-employee ShareSave Scheme in the UK. This Scheme, which is Inland Revenue approved, enables employees to purchase shares in Sepura through regular savings made over a three or five year period but at a discount of up to 20% on the share price as determined at the outset. The Company intends to make an annual invitation under this Scheme and will from time to time consider its extension to other countries in which we have established a major operating presence.
Sepura is committed to providing equality of opportunity to all existing and prospective employees without unlawful or unfair discrimination. In addition, we are supportive of the employment and advancement of disabled persons.

Health and Safety

The Health and Safety Committee is responsible for controlling, directing and delegating responsibility for practical day-to-day compliance with the Group's Health and Safety Policy Statement, together with relevant legislation and operating procedures, to line management and functional heads. Appropriate training, and the ongoing awareness programme for all employees to help create and maintain a safe and healthy working environment, is also coordinated by this Committee.

The Board is regularly briefed on the status and improvement initiatives relating to our Health and Safety System which is pro-active and remains effective. This is evidenced below and by the continued satisfactory audits undertaken by our external advisors and the fact that only eight very minor incidents occurred during the year.
Whilst it continues to be the Company's policy to offer staff free influenza injections, additional policy and contingency plans have recently been laid down in the event of any pandemic virus impacting staff health and business continuity.
The main health and safety risks to the business continue to be fire, electrical faults, manual handling, work station use, driving and stress. Regular fire alarm testing, fire team briefings, searcher training and evacuation practices are carried out to mitigate any potential impact in the case of fire. Prevention actions for electrical faults include Portable Appliance Testing. The statutory testing of all equipment and appliances is up to date and the next five-year audit of our fixed wiring will be carried out in 2010. Manual handling training is offered to all staff to reduce risk of injury when lifting heavy objects and regular work station risk assessments are carried out together with any remedial action necessary. Our driving policy is aligned with legal requirements and all staff have free access to a stress counselling service.

Environmental Care

In appreciating the importance of good environmental practice, Sepura aims to ensure that its operations and products cause minimum detrimental impact to the environment. Consequently, our policy is to comply with all relevant legislation and to promote pro-active and effective environmental management throughout our business operations wherever practicable. The Board believes that the nature of the Group's activities do not represent any significant environmental risks and our performance responsibilities in this regard are channelled through an Environmental Committee which regularly reports to the Audit Committee and the Board, as appropriate.
The Company is ISO 14001 accredited. Our business complies with both the Waste Electrical and Electronic Equipment Regulations 2002 ("WEEE Regulations") and the Restrictions of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Regulations 2004 ("RoHS Regulations"). During last year we complied with the Batteries and Accumulators (Placing on the Market) Regulations 2008 and satisfied ourselves that our supply chain was able to fulfil its obligations. During the current year we will put in place a 'take-back' scheme for batteries and record sales by weight and chemistry to comply with the Waste Batteries and Accumulators Regulations 2009.

We are responding to the increasing demand from Government and stakeholders to measure and minimise the impact of our business on the environment. In the past year, we have improved our measurement of utilities and waste, the segregation of waste streams and the range of waste we recycle. In the last three years, we have reduced the use of paper in the organisation by more than 60%. In addition to waste paper collection, we have also now introduced plastic, aluminium, steel, battery, electrical, toner cartridge and cardboard collection and re-cycling arrangements.

A Carbon Trust audit has been carried out at our main Cambridge operations. The emissions have been assessed for the site and its staff at 1,397 t CO2 equivalents. The main source of carbon emissions are electricity consumption and employee transport. Reductions in electricity consumption should follow from the increased use of timers and energy efficient lighting installed this year. Reductions in employee transport should follow from the car sharing and cycle-for-work initiatives which have been recently been introduced, as well as from our participation in the local 'Travel for Work' scheme.
Having recognised the need for us to consider the whole supply chain for sustainability, we have recently completed the audit of our main suppliers with regard to their achievements and plans on this issue. With one of our major customers we also calculated the through life carbon footprint of 25 of our products using a GHG model. Looking forward, there will be increased focus on our designing for sustainability.

By way of supplement to our existing Environmental Procedures Manual and on-line Environmental Management System, a regular Environmental Newsletter is issued to help highlight and explain to staff and other interested stakeholders exactly what we are doing in this important and motivational area.

Community Involvement

Sepura aims to be a responsible corporate citizen and active employer in the communities in which we operate, particularly at our main operating site in Cambridge. We recognise that this is an area where we, together with our employees, could improve our participation levels in supporting local initiatives and events. Consideration is currently being given as to how this can be achieved during the coming year.