Section 172 (1) statement
Section 172 of the Companies Act 2006 requires a director of a company to act in the way he or she considers, in good faith, would most likely promote the success of the company for the benefit of its members as a whole. In doing this, section 172 requires a director to have regard, amongst other matters, to the:
(a) likely consequences of any decisions in the long-term;
(b) interests of the company’s employees;
(c) need to foster the company’s business relationships with suppliers, customers and others;
(d) impact of the company’s operations on the community and environment;
(e) desirability of the company maintaining a reputation for high standards of business conduct;
(f) need to act fairly between members of the company.
The Company has regular communication with shareholders via face to face and videoconference meetings as well as reporting performance on a monthly basis. There are also robust approval processes in place which provide our shareholder with the opportunity to provide input, consideration and authorisation for key strategic decisions impacting both the financial prospects of the Group and those relating to sustainability objectives. The board of the Company includes a majority of members elected by the shareholder.
The strength of our business depends upon the expertise, commitment and hard work of our employees and our objective is to retain the best workforce in order to meet the long-term strategy of our business. We engage our workforce regularly in open, transparent communication to highlight our accomplishments, explain future challenges and make key objectives clear so that each person understands how their role contributes to the success of the business.
Our Group serves global customers and, due to the nature of the products we supply, we work closely with them to develop products which meet their specific needs. Many of our customers are long standing and we engage with them on a regular basis to ensure that we continue to support the security of their supply chain, meet their quality standards and provide technical support. To achieve this, we depend on the performance and reliability of our suppliers, and we work collaboratively with key suppliers to ensure that they meet our standards.
As long-standing local employers, our companies work with their communities to ensure a safe and sustainable environment and support local and national charities through payroll giving schemes and fundraising events. On a wider scale, we support and develop products and technology which supports recycling in our industry, reduces waste and promotes the use of sustainable materials.
We set out below some examples of how the directors have had regard to the matters set out in section 172(1)(a) – (f) when discharging their section 172 duties in their decision making.
During the financial year, the directors established a group marketing and business development function within the Company to co-ordinate and prioritise group-wide business development projects. As a result, several key areas of development have been identified and the directors have sanctioned a feasibility study into the expansion of the Group’s capacity for recycling of polypropylene materials. The outcome of this study will be to ensure that the Group can respond to increasing customer demand in the area as well as meeting its own sustainability objectives.
Renewable energy investment
Continuing to deliver the Group’s strategy of increasing sustainability within its operations, and further to the completion of the installation of solar EV panels in Sumika UK in October 2022, the directors sanctioned the installation of panels at one of its sites in Turkey. The project is expected to generate around 30% of the site’s energy consumption, resulting in a further reduction of the group’s CO2 emissions and associated production costs. Review is underway of the installation of solar panels at other subsidiary companies as well as reviewing the replacement of production equipment with more energy-efficient models as opportunities arise.