What we do
ESG
We believe that through the way we act, Luceco has a significant opportunity to create a lasting positive impact on the world around us. We aim to do this through addressing three key areas of focus: creating a sustainable future, empowering people and working with integrity and transparency.
ESG – emissions
Carbon Neutral
operations in 2022
ESG – low carbon sales
38%
of revenue for low-carbon
products in 2022
Operating sustainably is a key part of the Group’s culture and is reflected within our Purpose, Mission and Strategy; where we have made sustainability a central pillar of the Group’s success. Our product portfolio, combined with our business model and experience, puts us in a strong position to help create a sustainable future for all. Our immediate targets have focused on realigning our product portfolio to concentrate on the sale of low carbon products, ensuring the plastic we use is recycled and further that the packaging of the products we sell is recyclable. Looking forward, we have committed to the Science Based Targets initiative (“SBTi”), targeting a 46.2% reduction in operational emissions and a 27.5% reduction in emissions arising from the use of sold products by 2031. Whilst we recognise there is more to do, our operations continue to offer one of the lowest operational carbon footprints in our industry and we are continuing to progress our sustainability agenda moving forwards.
Climate change
As one of the biggest challenges the world currently faces, climate change represents both a responsibility and opportunity for our business. We have seen a growing mandate from our stakeholders who are seeking meaningful action to tackle greenhouse gas emissions.
Recognising this, climate change is now included as a principal business risk. The Group is well positioned to make an increasing contribution to society’s climate objectives, which presents new business opportunities during the transition towards net zero. The Group has been working with external consultants since 2021 to better understand and mitigate our contribution to climate change.
Review of the year
Products & Services
Our low carbon product ranges (LED lighting, EV chargers and smart standby products) help customers to reduce their GHG emissions and transition towards a low-carbon future. We strive to develop more efficient products and better controls to improve energy efficiency.
Supply Chain
One of our strengths is the relationship we have with our suppliers. We recognise that we must work together to make more sustainable choices across product design, material choices and the manufacturing processes.
Research & Development
Our business is well placed to take advantage of the inevitable electrification of energy as we transition towards a low carbon economy. Opportunities for expansion into electric vehicle charging and other low carbon solutions such as smart home tech.
Operations
One of our first priorities is to reduce the emissions from our operations. By implementing efficiency improvements, we can reduce energy use, raw material use, waste and water use to limit our GHG emissions.
Achievements during 2022
- Acquisition of Sync EV and launch of single-phase Mode 3 EV chargers under the joint BG Sync EV Brand
- £78m of revenue from low carbon product categories, delivering significant progress against our £100m low carbon product revenue target for 2025
- 3.5-fold increase in lighting control revenue for LED lighting projects in 2022
- Insourcing of EV charger production within our China manufacturing facility with 100% renewable electricity supply
- Acquisition of DW Windsor with UK manufacturing capability and 100% renewable electricity supply
- Evaluation of key supplier’s physical climate risk exposure to understand vulnerabilities within our supply chain
- Specialist R&D function in China and the UK and R&D expenditure of £3.6m in 2022
- Development of higher power, three-phase EV chargers for larger homes and commercial premises
- Investigating on-street EV charging solutions within DW Windsor
- Dedicated optical engineer focusing on improvements to lens design to improve lighting efficiency
- Working towards the development of environmental product declarations (“EPD”) and industry best practice on circular design in lighting
- Sourced renewable electricity for all group operations in 2022, bring our scope 2 emissions to zero
- Offsetting residual Scope 1 emissions for 2022
- Investment in energy efficiency and automation projects within the China manufacturing facility
- Evaluation of our key locations (manufacturing and distribution centres) to better understand physical climate risk exposure to understand vulnerabilities across direct operations
- All plastic packaging is recyclable with a minimum 30% recycled content
Products & Services
Our low carbon product ranges (LED lighting, EV chargers and smart standby products) help customers to reduce their GHG emissions and transition towards a low-carbon future. We strive to develop more efficient products and better controls to improve energy efficiency.
Achievements during 2022
- Acquisition of Sync EV and launch of single-phase Mode 3 EV chargers under the joint BG Sync EV Brand
- £78m of revenue from low carbon product categories, delivering significant progress against our £100m low carbon product revenue target for 2025
- 3.5-fold increase in lighting control revenue for LED lighting projects in 2022
Supply Chain
One of our strengths is the relationship we have with our suppliers. We recognise that we must work together to make more sustainable choices across product design, material choices and the manufacturing processes.
Achievements during 2022
- Insourcing of EV charger production within our China manufacturing facility with 100% renewable electricity supply
- Acquisition of DW Windsor with UK manufacturing capability and 100% renewable electricity supply
- Evaluation of key supplier’s physical climate risk exposure to understand vulnerabilities within our supply chain
Research & Development
Our business is well placed to take advantage of the inevitable electrification of energy as we transition towards a low carbon economy. Opportunities for expansion into electric vehicle charging and other low carbon solutions such as smart home tech.
Achievements during 2022
- Specialist R&D function in China and the UK and R&D expenditure of £3.6m in 2022
- Development of higher power, three-phase EV chargers for larger homes and commercial premises
- Investigating on-street EV charging solutions within DW Windsor
- Dedicated optical engineer focusing on improvements to lens design to improve lighting efficiency
- Working towards the development of environmental product declarations (“EPD”) and industry best practice on circular design in lighting
Operations
One of our first priorities is to reduce the emissions from our operations. By implementing efficiency improvements, we can reduce energy use, raw material use, waste and water use to limit our GHG emissions.
Achievements during 2022
- Sourced renewable electricity for all group operations in 2022, bring our scope 2 emissions to zero
- Offsetting residual Scope 1 emissions for 2022
- Investment in energy efficiency and automation projects within the China manufacturing facility
- Evaluation of our key locations (manufacturing and distribution centres) to better understand physical climate risk exposure to understand vulnerabilities across direct operations
- All plastic packaging is recyclable with a minimum 30% recycled content
Targets and commitments
Luceco plc commits to reduce absolute Scope 1 and Scope 2 GHG emissions 46.2% by 2031 from a 2021 base year.
Luceco plc commits to reduce absolute Scope 3 GHG emissions from the use of sold products 27.5% by 2031 from a 2021 base year.
Luceco plc commits to generating £100m revenue from low carbon product sales by 2025 from a 2021 base year.
Metrics and targets
Scope 1 and 2 target (tCO2e)
Scope 3 target (tCO2e)
Low carbon product revenue £m
ESG objectives
At the start of the year, the Board agreed the following ESG objectives for 2022:
- Make significant progress towards delivering £100m of revenue from low carbon products in 2025
- Commit to the Science Based Target Initiative (“SBTi”) and seek the validation of associated emission reduction targets
- Ensure all products sold in the year use recyclable plastic packaging
- Ensure 30% of plastic packaging used in the year is recycled
Low carbon product revenue
We have delivered significant progress against our low carbon product revenue target and are on track to achieve this target by 2025.
Science Based Targets Initiative
During 2022, the Board signed off our commitment letter to join the Science Based Targets Initiative (“SBTI”). The SBTi defines and promotes best practice in science-based target setting and establishes how quickly organisations need to reduce their GHG emissions to prevent the worst effects of climate change.
Our target submission was made in July 2022 and the targets are currently being reviewed by the SBTi. Our proposed targets are to:
- Reduce absolute Scope 11 & Scope 2 GHG emissions 46.2% by 2031 from a 2021 base year
- Reduce absolute Scope 3 GHG emissions from the use of sold products 27.5% by 2031 from a 2021 base year
To achieve our target scope 1 and 2 target, we have increased our sourcing of renewable electricity to 100% and will investigate opportunities to reduce our reliance on fossil fuels across transportation, heating and process use. This includes transitioning to electric vehicles for company cars and the use of heat pumps to replace gas-fired heating systems in our offices and distribution centres. We will also focus on improving energy efficiency to reduce costs and GHG emissions.
For our scope 3 target, we will continue to innovate to improve the energy efficiency of our products. We have a track record of increasing lumens per watt and continue the integration of controls with lighting products to reduce energy use. Our R&D efforts within EV chargers will focus on how to enhance smart connectivity, reduce charging losses, and reduce standby power consumption. Finally, efforts made by countries in which are products are sold to decarbonise the electricity grid will help deliver significant reductions in our emissions from the use of sold products.
We have made great progress in the first year of our target and will continue our work to reduce GHG emissions across our entire value chain.
Plastic Packaging
During 2022, we have improved our packaging specifications, particularly around plastic packaging. The first improvement we have made is to ensure that packaging is made from one single polymer to ensure they are recyclable. The second improvement has been to increase the minimum recycled content of plastic packaging to 30%.
1. Scope 1 emissions include the biogenic elements as per the SBTi target requirements.
Next steps and plans for 2023
Our ESG objectives for 2023 are as follows:
- Formally engage with key customers to better understand their climate ambitions and to communicate our strategy
- Undertake detailed energy audits of UK operations as part of the Energy Savings Opportunity Scheme
- Develop a Research and Development roadmap for over the short, medium, and long-term that will help us deliver our Scope 3
science-based target - Begin work to develop a set of product design criteria that help to improve the sustainability of our products
Our culture
Our business model is underpinned by the “can-do” culture of our teams. Our people are customer-driven, designing products which we know our customers will love and that will improve the customer experience. We are team-focused, working together to achieve our objectives. We ensure that we reward achievement with opportunity. We aim to be bold and innovative, thinking differently and trusting each other to create great products for our customers. Finally, alongside all these qualities, we are principled in the way we act with our customers and suppliers. We do what we say and do what is right.
We recognise that in order for this “can-do” culture to continue to thrive, we need to invest in our people. We focus on the training and development of our teams, so they have the skills to innovate and confidence to move quickly. We carefully recruit from all backgrounds to ensure our teams work well together. We engage with our employees and act on their feedback, to ensure our teams feel part of our business and go the extra mile for our customers. Above all else, we treat our teams with the respect and recognition that their hard work deserves and apply the same principled mindset to them as they do to our customers.
Equality and diversity
We understand the importance and benefits of greater diversity, including social and professional background, cognitive and personal strengths, sexual orientation, disability status, gender and ethnicity throughout the organisation. We are committed to ensuring that recruitment and promotion of individuals at all levels of the business is based on merit and objective criteria and that, within this context, each candidate is judged on their unique combination of skills, knowledge and experience, as well as their social and professional background, cognitive and personal strengths, sexual orientation, disability status, gender and ethnicity.
Gender diversity
The table below shows the gender diversity of our workforce at the year end. We have taken a number of steps in recent years to promote the retention of female talent, including improving maternity benefits and improving flexible working.
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1. Individuals reporting directly to the CEO or CFO.
2. Individuals reporting directly to senior management.
Learning and development
We know that high quality and sustained learning and development (“L&D”) is crucial to the ongoing success of the business. We are also aware that with an increase in flexible working, it is all the more important that we maintain consistency in our training procedures, and this starts on day one of an individual’s employment at Luceco. Within their first week of employment all staff receive a Company induction from their Human Resources Manager, Payroll Manager and a Health, Safety and Facilities Coordinator. This ensures the new team member feels comfortable in their environment and that they know we are available to help should they need assistance. We also recognise how important the line manager’s role is in the induction process and we ensure that all line managers are trained in how to work with new starters, how to identify their initial needs and how to set clear goals and objectives.
Following induction, we continue to develop employees for the long-term. Through our Annual Performance Review process, we do not just look to appraise performance in the year, we identify individual training needs and ensure specific personal development plans are in place to tailor to that team member’s requirements.
Luceco has invested heavily in our L&D tools in recent years, partnering with Hays Thrive/Go 1 to introduce our first L&D platform, which is available to all employees. This platform covers compulsory training, such as “Anti-money Laundering” to ensure our teams have the knowledge they need to comply with all relevant laws and regulations, but also includes modules related to more personal development and growth. We are pleased with the continued success of this project in 2022, with 3,975 training modules completed by our employees during the year.
Importantly the L&D platform covers learning regarding mental health and general wellbeing, which is something that we have sign-posted to our employees, especially in light of the pandemic. Our employees’ health, happiness and wellbeing is paramount to us and we are pleased that this platform is providing further support.
We act fairly in our dealings with fellow employees, customers, suppliers and business partners. Our global Code of Conduct applies to all Group employees and our external business partners. It aims to ensure that Luceco maintains consistently high ethical standards across the globe, while recognising that our businesses operate in markets and countries with cultural differences and practices.
The Code of Conduct is available on our intranet and all new employees are made aware of it during their induction.
Health and safety
Our Health and Safety Policy sets out our approach to providing attractive working conditions for our people. We aim to prevent harm to, and promote the health of, all employees, by applying health and safety programmes, rules and regulations at all of our sites. All employees are responsible for complying with health and safety regulations and we have a health and safety champion in each operating unit, who is responsible for ensuring compliance with best practice and all local regulations.
Our Health and Safety Policy is made available in local languages and all new starters must confirm that they have read and understood it. The policy is reviewed in full at least annually and more regularly if required.
We continually monitor our health and safety performance to ensure compliance and to enable us to take any corrective action if issues are identified. During the year, there were 19 non-reportable accidents reported in our Telford facility (2021: 14) and in China, two minor accidents were reported (2021: ten).
Human rights
One of our business principles is that we will support fundamental human rights, in line with the legitimate role of business. Our Code of Conduct sets out our policies in respect of a range of human rights and related issues, including child labour, forced labour, the right to organise, collective bargaining and participation in political life.
The Group’s operations in high‑risk countries must perform self‑assessments, to make sure they are aware of the human rights impact of their operations. If a negative impact seems possible or likely, they are encouraged to take precautions or find solutions that are beneficial for employees and the communities in which they operate.
Among our international operations, China is the location where people’s rights could be most at risk. By owning the facility in China, we can directly control the environment and conditions in which our employees live and work, to ensure they are treated fairly and in accordance with our policies. Until the introduction of pandemic travel restrictions, the Directors regularly visited China and routinely invited customers to the facility, so they could witness the working and living conditions of our employees. This helps our customers to fulfil their own responsibility agendas.
The UK Modern Slavery Act 2015 requires us to outline the steps we take to identify and prevent modern slavery within our organisation and supply chain.
Click here to view our Modern Slavery Statement
Communities
We are keen to contribute to the communities we operate in and our Code of Conduct encourages our people to actively participate and to propose projects to site management or site committees.
In Jiaxing, China, we are heavily involved with the local university, establishing a “Luceco class” where students were selected to receive weekly lectures for three terms. These are led by our managers or technical experts and aim to provide students with greater business sense and awareness, career advice and preparation for entering the work environment, with exposure to marketing, management, product knowledge and development and project management.