2006 UK Fleet Safety
Awards: Road Risk
Manager of the
Year awarded to
Wolseley UK

Health and safety

The Company has developed a health and safety framework which requires local management to have suitable procedures in place to ensure compliance with applicable laws and regulations and, wherever possible, to employ best practices. One of the key issues for the Group is the creation of a work environment free from injury and illness and how to achieve improvements in our health and safety performance. This is driven not only by legal responsibility, but also by the ethical desire to protect our employees. Wolseley UK has an Executive Safety Steering Group, supported by its health and safety department. This comprises senior managers and local board directors. The Steering Group reviews the UK businesses' performance in health and safety matters, promotes good practice and ensures appropriate consultation on any intended changes to its health and safety management systems. All branch and area managers are trained in this area and all employees are trained to complete their daily tasks in a safe manner. In July 2006, Wolseley UK received recognition for its health and safety initiatives by winning two awards at the UK Fleet Safety Awards. The awards are a national event organised by Brake, the UK road safety charity, and are designed to promote risk management best practice among businesses by recognising organisations and professionals who have worked significantly to improve the safety of vehicle operations. The awards for "Road Risk Manager of the Year" and "Best Crash Analysis Procedures" recognise the work undertaken by the company's Fleet Safety Steering Group which introduced a fleet safety handbook, newsletters, an occupational road risk policy, regular management review meetings with industry experts and insurers as well as benchmarking against best in class. Online driving assessments and a "Commercial Vehicle Driver of the Year" award to promote safety amongst employees have also contributed towards increased awareness of safety issues and an overall reduction in commercial vehicle and company car accidents.

Brossette has a central health and safety committee which oversees the work carried out by the health and safety committees in individual branches. Representatives of Brossette and its employees sit on each local committee, together with an occupational health doctor. All new employees and managers receive appropriate induction and training which includes matters related to health and safety. PBM seeks to increase awareness of the importance of health and safety matters throughout its business using a programme which reinforces the fact that each of its employees has both a responsibility and a part to play in maintaining and improving health and safety standards. Stock Building Supply has a safety committee with responsibility for developing, introducing and monitoring the effectiveness of its overall safety programme and objectives. Stock Building Supply recognises that it must work together with its employees towards the common goal of eliminating hazards and accidents and employees are expected to participate in actively promoting a positive safety culture. The safety committee comprises employees with different perspectives and from varied disciplines. Each branch manager is responsible and accountable for health and safety at his or her branch, including compliance with regulations, safety awareness and accident prevention. All new employees are given induction training relating to safe working practices and hazards present in the workplace. Training is also provided when an employee is requested to manage new processes, procedures or equipment. Monthly mandatory safety meetings are held at each branch during which, as a minimum, topics designated by the safety committee must be discussed. Safety issues within each branch are dealt with by a safety coordinator or local safety committee consisting of a cross-section of employees.

Driven to Safety initiative to
be rolled out within
Ferguson in 2006/7

Stock Building Supply and Ferguson have been working together over the last three years to improve their performance in the areas of both health and safety and traffic accidents. The joint initiative has been driven not only by the costs to the business of increasing medical and other expenses associated with claims for workers' compensation but also the desire to reduce the incidence of injury and to reduce the consequential effect that such incidences have on other employees and the business. Each of the businesses set targets during the year to reduce the frequency and cost of both workers' compensation and traffic incidents, enhance their programmes to help employees to return to work even if this is on modified duty, improve the reporting of claims to ensure that prompt action is taken and increase measures to ensure that employees are able to seek any required medical attention. This joint initiative has resulted in a significant improvement to the longer term trends in both companies' health and safety records. Ferguson, having seen a 14% reduction in the number of work-related injuries in the six months to 31 March 2005, saw an increase of 24% in the number of such injuries in the year to 31 July 2006 against a background of a 19% increase in its workforce. Whilst Stock Building Supply achieved a 21% reduction in work-related injuries in the six months to 31 March 2005 it experienced an increase of 22% in the number of such injuries in the year to 31 July 2006 during which period its workforce increased by 23%. Measures have been taken to increase focus to return to the results achieved in 2005. These include the appointment of a director of health and safety for the North American businesses and, with effect from 1 August 2006, the creation of a North American safety committee which will oversee such matters across both the US and Canada. Ferguson achieved a 100% rate of returning injured employees to work either on modified duty or to their original jobs, with Stock Building Supply achieving 90% in the year ended 31 July 2006. Both companies have continued to make progress in reducing vehicle accidents and the impact of such accidents over the last year. Ferguson saw an increase of 6.5% in vehicle accidents in the year ended 31 July 2006 in a period when its vehicle fleet expanded by 23% and Stock Building Supply held its accident frequency rate at prior year levels. In May 2005, Stock Building Supply introduced its "Driven to Safety" programme, a proactive safe driver training programme. Since then, every delivery driver has been trained in a variety of ways to recognise hazardous conditions, plan the appropriate response and take decisive action. Every new driver joining Stock Building Supply receives such bespoke training and each driver's knowledge and ability to practice safe driving techniques will be assessed. Ferguson intends to roll out a Driven to Safety initiative within its own business during the year ending 31 July 2007. Ferguson has continued to promote its Customer "CARE" (Customers and Associates Require Excellence) programme which is intended to symbolise Ferguson's determination to achieve a culture of excellence throughout the organisation. The programme includes two goals aimed at communicating the importance of safety and quality and to promote a safe working environment for all of its employees. In common with Mart in Hungary which obtained its accreditation in 1997, Cesaro in the Czech Republic has also continued to demonstrate its commitment to customer care during the year following its achievement of ISO 9001 accreditation in June 2005 for its quality management processes. The continued accreditations acknowledge the companies' ability to fulfil their customers' quality requirements and applicable regulatory requirements while aiming to enhance customer satisfaction and achieve continual improvement of performance in pursuit of these objectives.

Acquisitions

A great deal of importance is placed on environmental matters during the due diligence process for acquisitions. External environmental consultants review and assess environmental risks to which the Group could potentially become exposed. Depending upon the type of proposed acquisition, this assessment could include reviews of environmental management systems, compliance with laws and regulations and the respect and care shown for the environment. Health and safety compliance and processes are also considered as part of the process. Appropriate dialogue with, and indemnities from, the proposed vendors are sought where appropriate.

Code of Ethics

A Groupwide Code of Ethics has been in place since 2003. This sets out a number of fundamental principles which all companies and employees are required to follow. In keeping with our decentralised approach, businesses are required to adopt their own codes which respect local cultures and businesses but which also set standards that are still no less exacting than those detailed in the Groupwide Code. To a large extent, these individual codes simply underpin and endorse existing practices. New companies joining the Group are required to adopt codes of ethics on the same basis as existing businesses. The Groupwide Code covers many areas including fair competition, compliance with laws, including anti-trust laws, maintenance of the Group's reputation for integrity (including a prohibition on bribery and general principles for dealing with suppliers and authorities) and can be viewed on the Company's website at www.wolseley.com or a printed copy is available from the Group Company Secretary. Wolseley UK, for example, has incorporated the Code of Ethics into a wider document which sets out the principles on which business is transacted. This includes principles related to diversity, safety, inducements, communication, the environment and human rights. The human rights policies and procedures are based on the principles set out in the United Nations Universal Declaration on Human Rights.