Where BAM can improve
Despite BAM’s continuing effort to improve safety on its projects, the company deeply regrets the sad loss of one BAM employee, one passer by and one employee of a subcontractor on a joint venture project. The Group faced two fatal accidents in January 2017. As a result the upcoming Management Board meeting was combined with the international Safety Officer’s meeting which took place in February 2017. The purpose was to create a specific action plan together that should avoid such incidents for the future, on a company level as well as on a personal level. Commitment, visible leadership and knowledge sharing are a few of the main topics in this plan. BAM is aiming for zero accidents, regardless of the severity of the accidents or the numbers of hours worked. We are in the process to generate a genuine and sustainable safety leadership culture across the senior management of the Royal BAM Group.
Health and safety
Royal BAM Group feels responsible for all people involved in or affected by the activities of the Group. This includes BAM’s employees, clients, designers, partners, suppliers, subcontractors, buyers and the general public.
In order to effectively monitor its safety performance, BAM records statistics of the following groups:
- BAM employees (all employees with an employment contract with the company);
- Consortium/joint venture (all BAM employees, leasing employees, self-employed persons and employees of subcontractors and their subcontractors who are working for BAM);
- Other/third parties (principal, supervisor, inspector, supplier, visitor and so forth).
The IF for BAM is determined by the total number of industrial accidents leading to absence from work, per million hours worked on construction sites (on risk). In 2016 the IF increased to 4.8 (2015: 4.5), which is above the 2016 target of 4.5. The number of fatal and serious accidents (BAM employees, hired, subcontractors’ employees, other) decreased from 153 in 2015 to 127 in total in 2016. An accident is classified as serious when an employee is admitted to hospital for more than 24 hours or results in electrocution (with enter- and exit mark on the body), amputation or a fracture.
Safety Behaviour Audit
With the introduction of the SBA, ‘awareness’ was replaced by ‘behaviour’. This new type of auditing should lead to an increased focus on safety behaviour, commitment and performance, still based on an assessment and interviews, leading to a report and improvement plan. Moreover, a SBA is not just about safety but it is about leadership and behaviour in all parts of the company and supply chain.
This customised knowledge exchange, introduced in 2016, is an open dialogue between two operating companies that focusses on a debate for challenging and learning (themes from the safety maturity model, see next paragraph) in which they have to come up with solutions together.
2016 was a year of developing and learning to work with SBAs and SEs, in order to launch these new types of dialogue officially in 2017.
Based on twelve leading (safety) indicators, all of BAM’s operating companies except for BAM PPP are measured on the subjects:
- Visual leadership/Ambition;
- Continuous improvement/Innovation;
- Training and development;
- Supply chain management;
- Tender risk management;
- BIM/Safety by design;
- Logistics and traffic management plan;
- Method statement;
- WASP/Partner plan;
By connecting two operating companies regarding one leading indicator, the set-up is made for each Safety Exchange.
As of 1 October 2016 reporting was extended with adding high potential near hit/miss incidents. Creating uniform safety reporting across all operating companies is one of the strategic objectives, which enables access to the right management information.
BAM is still in the process of enhancing the reporting process for worked hours of subcontractors. The Group strives to obtain reliable information by implementing automated on-site entrance systems as tourniquets, fingerprint readers, iris scans and card systems.
When a fatal industrial accident occurs, involving a BAM employee or a subcontractor, the following actions take place:
- The operating company informs the Executive Board and the Corporate Safety Officer (CSO) directly after the accident;
- The first details of the accident are communicated within 24 hours of the accident;
- No later than the day following the fatal accident, a message will be published on BAM’s intranet;
- If the accident occurred in Western Europe, the COO, assisted by the CSO, will pay a visit to the operating company within 15 days after the accident;
- For accidents occurring outside Western Europe: video-conference;
- Three weeks after the accident a ‘safety start’ takes place in the country where the fatality occurred; A safety presentation/ bulletin has been produced highlighting the lessons learned and who must have intervened. This has to be briefed out to all operatives.
More insidious than the fatal and serious industrial accidents is the number of workers who suffer impaired health or long-term illness caused or made worse at work. Many of these illnesses only manifest themselves years after exposure and many are ultimate fatal. BAM believes that all injuries, deaths and illnesses can and should be prevented. BAM is in the process of setting minimum health management requirements. Within ENCORD, Europe’s forum for industry-led research, development and innovation in the construction industry, the Group has put on the agenda research and development regarding quartz dust and asbestos inhalation, diabetes and skin cancer.
Worldwide BAM Safety Day
The seventh Safety Day was held on 11 October 2016. The starting point remained to improve BAM’s safety results at all construction sites, worldwide. Involvement of construction site employees and, not least, BAM management is crucial to get the message trough. However, some 75 per cent of the employees at the average BAM site are employed by subcontractors. This means the performance of these colleagues has a major impact on the safety performance of the companies project teams. Explicitly involving BAM’s subcontractors in the Safety Day therefore was a logical step towards improving the Group-wide safety results. The key objective of the ‘one team, one mission’ theme was to raise awareness about the crucial role of subcontractors in projects and – in line with the updated strategic agenda – emphasising the importance of cooperating, sharing knowledge and learning from each other.
BAM's vitality and health policy and procedures contribute to sustainable employability. The policy is based on a shared responsibility between employer and employee and has resulted in a decreasing trend in BAM’s absenteeism figures over the past years.
The vitality and health policy is focused on:
- Prevention: promote health and well-being and increase awareness.
- Control: active guidance is provided by managers and case managers to reduce absenteeism, disability and ill health incapacity and promote responsible reintegration.
BAM initiated a building performance strategy to evaluate social, economic and environmental performance of its buildings. Discovering the relationship between the Indoor Environmental Quality (IEQ) and health and wellbeing (and productivity) creates an opportunity to help clients to consider better, sustainable design options in an early stage. IEQ refers to the quality of a building’s environment in relation to the health and wellbeing of those who occupy space within it.
Business conduct and transparency
In 2013, the code of conduct of BAM was modernised. The signed agreement with the Building and Woodworkers’ International promoted inclusion of human rights into the norms and values of BAM and aligned to other regulations such as the UK Bribery Act. New employees are required to sign a declaration of adherence to this code as part of their employment agreement with BAM. An e-learning tool has been launched to train and remind employees of these values and standards. The training is available in English, German and Dutch and has an obligatory character for all new BAM employees. By the end of 2016, 6,000 employees have completed the training, compared to 2,598 in 2015. In 2016 the number of completed trainings has increased due to a renewed focus on business conduct. The largest growth comes from the Dutch operating companies, others will further implement the tool in 2017.
In 2016 the Group started to strengthen the governance on compliance within the company. Two compliance officers’ meetings were organised. The purpose of the two meetings was to share knowledge and to get to know the new developed tools and policies like the bribery policy, competition policy, the internal misconduct reporting procedure, the new SpeakUp-line and the new developed internal reporting. The new roles of compliance officer and confidential officer were also discussed and the compliance officers shared dilemmas they came across in their roles.
During the fourth quarter of 2016 BAM finalised its planning to complete outstanding actions to ensure compliance is embedded in the organisation. A communication toolkit is being created to help the compliance officers to implement the new developed tools in the operating companies.
In 2016 no legal actions were reported by operating companies to BAM's headoffice for anti-competitive behaviour, anti-trust and monopoly practices or corruption.
The Corruption Perception Index (CPI) is calculated annually by Transparency International, which focuses on strict implementation of the UN Convention against Corruption.
The CPI classifies countries according to their perceived level of corruption on a scale from 0 to 100. BAM achieves the majority of its turnover in countries with a Corruption Perception Index score higher than 80, i.e. in countries with a very low risk of corruption.
Corporate income tax, taxes on wages, social security contributions, and VAT are also considered relevant taxes in relation to the turnover that BAM makes in the areas where it works. In 2016, BAM increased its transparency on tax payments by adopting public county-by-county reporting for the first time. These taxes provide good comparability in BAM's home countries and the rest of the world. Under these categories BAM’s taxes amount to €783 million. Relative to BAM’s turnover, the share of taxes paid deviates most from the share of turnover in the Netherlands. Here, BAM’s share of taxes is relatively high compared to turnover.
In October 2016, the Dutch Association of Investors for Sustainable Development (VBDO), published a comparative study on tax transparency of 68 Dutch listed companies. BAM ranked ninth in overall ranking of companies. Tax is vital to society and by paying taxes companies contribute to society. BAM recognises that fair distribution of tax revenues is a key factor in fostering the business climate and economic growth that both multinational companies and societies need to thrive.
For more information on responsible tax, visit the website www.bam.com.
Employee recruitment, development and retention
The new 2016-2020 strategy has been the starting point for BAM’s HR initiatives in 2016. The new HR strategy has been developed in several sessions with the ten HR directors representing all operating companies. The focus of the strategy is to have similar processes and exploit synergies across the Group. The important HR areas for business support are insights and development from BAM's people, recruiting new talent, compensation and benefits, and HR people support and data insights.
Continuous organisational development
The complexity of the world asks for continuous improvements and different ways of working. Therefore the organisation needs to be as agile as possible. Constant changes in different parts of the organisation are expected to be able to deliver the best products. Change will be the norm and communication is important. With the aim for further improving communication, 2017 will see the introduction of a European Works Council.
In defining the unique BAM culture and determining how to steer the culture in the strategic direction, the Group is enabled by the four values as written in the BAM strategy: predictable performance, scalable learning, pro-active ownership and open collaboration. Living the values and the culture will be an important theme for 2017, and BAM has made a start in 2016 by discussing the culture and values and how to integrate them in the daily work of BAM’s employees.
The recruitment of new employees provides the perfect opportunity to diversify the workforce and find potential talent with different capabilities, various degrees of experience and different genders, nationalities and cultural backgrounds. Together, they can help BAM mirror its client base and execute its strategic agenda. Therefore the Group took all job and candidate profiles under evaluation in 2016. This will support BAM’s search for the best fitting talent. To attract talent BAM works on employer branding standards and better applicant experience.
Diversity is a continuous focus since the construction industry has a low level of emancipation. A good signal on diversity comes from BAM's young graduates programme in the Netherlands. This was almost balanced at year-end: seven female and eight male participants. Diversity at senior levels has our attention, but shows only limited progress. The definition of diversity in senior roles extends beyond gender diversity, and calls for more attention to cultural backgrounds, differences in experiences and age diversity in the formation of project teams or in external recruitment.
A talent review process was conducted with the boards of all operating companies to discuss current and future needed capabilities for BAM. The key business and project managers were discussed in terms of leadership, succession and opportunities for development. In follow-up meetings progress, talent exchange opportunities and short-term succession goals were discussed.
Attracting young graduates remains crucial to BAM. The existing Dutch graduate programme was refined and a move was made towards a single BAM graduate programme for the benefit of all home markets. The young talent career proposition was complemented with a finance graduate programme.
Internal (international) mobility will be supported to support internal learning by sharing.
Project Olympus, developing BAM’s senior project managers
BAM’s project managers are fundamental to the success of BAM. In order to be our clients’ partner of choice we need the most talented project and tender managers. To achieve this ambition the Group-wide Project Olympus was initiated. Project Olympus aims to recognise and develop BAM’s project managers and offer them rewarding career propositions. In order to realise this the Group designed a project management development programme and started a pilot to establish a project management community network for knowledge sharing and Group-wide collaboration. In several seminars BAM brought together project managers to connect and to share their views and experiences on leadership, personal development and knowledge sharing. The outcomes will be used as valuable input for future initiatives.
During two meetings, one in spring and one in autumn, aroundhundred staff from all parts of the Group to discuss the strategy and share initiatives. Sharing ideas has led to Group connections and scalable learning: not reinventing the wheel but sharing shows the opportunities of being ‘one BAM’.
Annual total compensation by country
In 2016 the rounded ratios for annual total compensation of BAM’s highest paid individual to the average annual total compensation for all employees remained at the same level as in 2015, except in Germany. Here, the ratio decreased from seven to six, which means that the average salary increased more than the salary increase of the highest paid individual. The ratio of percentage increased in the Netherlands and decreased in Belgium and Germany.
The relatively high ratio for BAM’s international business can be explained by the fact that Dutch management members work together with local workforce, thereby explaining the difference in salary standards.
As part of its strategy, BAM has initiated a target around enhancing lives by 2020. This consists of:
- Acknowledging the benefits it provides to local communities;
- Education and skills;
- Charity partnerships;
- Generally by enhancing the lives of its workforce.
In order to start measuring this social value, BAM has started a cross company steering group to understand the maturity of BAM in different operating countries and to make a roadmap to develop a consistent methodology and reporting framework. Ultimately BAM wants to demonstrate the added value it provides to society through its operations.
Community engagement progress
In 2016, local community engagement programmes that measure and manage the impact of building projects on the local environment were implemented in 33 per cent of BAM’s operations. These were initiatives as part of existing programmes, such as the Considerate Constructors Scheme (CCS), Bewuste Bouwers and Making TIME for Communities, as well as unique initiatives of engagement managers on projects and site-specific sponsoring or charity work.
Considerate Constructors Scheme
CCS fosters good communication with the local community and promotes professionalism on building sites. Both BAM Construct UK and BAM Nuttall in the United Kingdom are associate members of the CCS. Construction sites registered under the CCS scheme are monitored to ensure that they comply with the Code of Considerate Practice developed to promote good practice, going beyond legal requirements.
Based on the success of the UK Considerate Constructions Scheme, BAM was one of the companies that introduced the scheme Bewuste Bouwers in the Netherlands in 2009. After five years of BAM participation, Bewuste Bouwers decided to involve BAM in a further roll-out of the scheme. During 2016, 78 sites were registered under the scheme in the Netherlands (2015: 78).
Making TIME for Communities
BAM Construct UK continued its commitment to targeting the social issues highlighted in the Making TIME for Communities strategy. For the fourth year running, BAM Construct UK’s community initiatives were award winning, with the Coventry and Warwickshire Construction Shared Apprenticeship Scheme winning two awards. The scheme, which is a unique public/private partnership between Coventry City Council, BAM Construct UK and local colleges, won the Partnership Initiative of the Year Award. BAM Construct UK uses the London Benchmarking Model (www.lbg-online.net) to quantitatively measure the monetary value of its community efforts. In 2016, over €558,463 (£454,036) was invested into the communities surrounding BAM Construct UK’s projects, which benefitted over 20,000 people.
BAM Construct UK continued to use an apprentice-tracking tool to document the number of young people gaining expertise on its sites. In 2016, over 390 apprentices and over 50 trainees have gained over 24,000 days of site experience on BAM projects.
BAM uses a tool to measure supplier performance. During project preparation, implementation and follow-up, the tool assesses suppliers against the themes safety, quality, total cost, logistics and engineering and process. Operating companies are at liberty to add any specific criteria. On a scale of 1 to 4, each supplier has to score at least 3 for each criterion. In 2016 a total of 4,198 supplier performance assessments were carried out.
In 2006, BAM and the international federation Building and Wood Workers’ International (BWI), signed a framework agreement to promote and protect employee rights. On 26 May 2015, a delegation of BWI and trade union organisations FNVBouw STICC visited the BAM project site of Hoog Catharijne in Utrecht, the Netherlands. No anomalies were detected in any of the areas that have been assessed by the BWI. A report, issued by FNVBouw confirmed this and stated that, among other things, there is an extensive safety programme on site, employment is freely chosen, there is no discrimination in employment, child labour is not used, working conditions are decent, safety representatives are chosen and the employment relationship is established.
In September 2017 this delegation will visit a BAM project site in Dubai. Special attention will be paid to:
- The safety programme on site;
- Migrant workers;
- Recruitment policies;
- Working conditions;
BAM is currently finalising a statement of compliance with The Modern Slavery Act 2015 (UK), publishing its commitment to combatting slavery and human trafficking throughout its operations and those associated with its business, for example within its supply chain.