Approach - Drax

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Building a sustainable business

At Drax, being a sustainable business means achieving a positive economic, social and environmental impact as part of the Group’s strategy.

Ratings and Initiatives

CDP is a global environmental disclosure system for investors, business, cities, states and regions. In 2019, Drax received a score of B in the CDP Forests Programme and C in the CDP Climate Change Programme.

Drax is a constituent of the FTSE4Good Index Series. View certificate [PDF]

MSCI ESG RATINGS

MSCI ESG Research provides MSCI ESG Ratings on global public and a few private companies. In 2019, Drax received a rating of AA (on a scale of AAA-CCC) in the MSCI ESG Ratings assessment.

We have been a UN Global Compact (UNGC) participant since 2018, demonstrating our commitment to the universal principles on human rights, labour, environment and anti-corruption. The Drax Group Annual Report and Accounts 2019 forms our latest Communication on Progress.

*THE USE BY DRAX OFANY MSCI ESG RESEARCH LLC OR ITS AFFILIATES (“MSCI”) DATA, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT, RECOMMENDATION, OR PROMOTION OF DRAX BY MSCI.  MSCI SERVICES AND DATA ARE THE PROPERTY OF MSCI OR ITS INFORMATION PROVIDERS, AND ARE PROVIDED ‘AS-IS’ AND WITHOUT WARRANTY.  MSCI NAMES AND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI.

Governance

The Board has ultimate responsibility for the Group’s economic, social and environmental performance. The Executive Committee, chaired by the Group Chief Executive, directs sustainability and oversees performance. Biomass sustainability performance and progress is reviewed formally by the Board and the Audit Committee, once a year. In addition to this formal review, supplementary papers are submitted as required.

The Executive Committee reviews sustainability performance and progress. As required, sustainability issues are referred by the Executive Committee to the Board.

The Group Director of Corporate Affairs leads Drax’s sustainability programme and is a member of the Executive Committee.

The Executive Committee has oversight of risk, ethics and business conduct for the Group. This responsibility is discharged through the risk management framework, as described in the principal risks and uncertainties section in our Annual Report and Accounts 2019.

In 2019, Drax established an Independent Advisory Board to provide advice on sustainable biomass and its role in Drax’s transition to net zero emissions. The Board will feedback and make recommendations on Drax’s sustainable biomass approach and performance.

Independent Advisory Board on Sustainable Biomass

Renumeration and incentives

Total Recordable Injury Rate (TRIR) is included in the Group scorecard of strategic and Business Plan measures. Scorecard performance is one measure of our long-term incentive plan.

Our Priorities

We have identified non-financial priorities that are material to our business and important to our stakeholders. Our 2019 progress and performance are reported under each priority area as follows:

EnvironmentSocialEthics and integrity
• Carbon emissions
• Environmental impact
• Sourcing sustainable biomass
• Healthy Forest Landscapes
• People and culture
• Healthy, safety and wellbeing
• Positive social impact
• Ethics and integrity

Impact on the Sustainable Development Goals

The 17 United Nations’ Sustainable Development Goals (SDGs) are a blueprint to achieve a better and more sustainable future for everyone. We have identified six SDGs where we can have the greatest positive impact.

ENVIRONMENT

Affordable and Clean Energy

We contribute to the share of renewable energy in the global energy mix.

Climate Action

We contribute to SDG 13 to take action to combat climate change and its impacts across our business.

Life on Land

We promote the implementation of sustainable forest management in all working forests that we source from.

SOCIAL

Industry, Innovation and Infrastructure

We contribute to investment in infrastructure and innovation in the energy sector, progressing the technological capabilities of our sector and contributing to research and development spending.

Sustainable Cities and Communities

We contribute to SDG 11 to make cities and human settlements inclusive, safe, resilient and sustainable.

Partnerships for the Goals

We proactively collaborate and engage with all stakeholders and seek partners to achieve our purpose of enabling a zero carbon, lower cost energy future. This directly enhances the global partnership for sustainable development to support the achievement of the Goals.

Stakeholder Relations

High quality engagement with the full breadth of our stakeholders is key to well-informed decision-making that pays appropriate regard to stakeholder views.

Drax has a wide range of stakeholders and takes care to ensure that the Group, and the Board, has an effective strategy to identify and engage with those stakeholders.

We have a comprehensive stakeholder engagement strategy. This is detailed in the Communications Strategy, which is presented to the Board at least annually and sets out our stakeholders and provides oversight of how the Group intends to engage with them.

Engagement with stakeholders informs both our day-to-day decision making, that ensures the smooth running of the business, and the strategic decisions which help set our direction for the years and decades to come.

Drax employs dedicated teams to engage both proactively and reactively with particular stakeholder groups. This includes a stakeholder relations team, an investor relations team, an internal relations team, a sustainable business team, a business ethics team, a media relations team and a digital engagement team.

Methods of engagement with stakeholders vary according to the issue at hand and the stakeholder concerned.

Our Annual Report and Accounts 2019 sets out the broad stakeholder groups that we have identified and engaged with during 2019. It also highlights why we engaged, how we engaged and the areas of focus.

Assurance Statement

We engaged Bureau Veritas to provide limited assurance of select non-financial data points using the assurance standard ISAE 3000. A summary of the work performed is outlined in the full assurance statement.