Sustainability Report 2022

With a history dating back over 150 years, Downer is listed on the Australian Securities Exchange and the New Zealand Stock Exchange as Downer EDI Limited (DOW). We are an ASX 100 company that employs approximately 33,000 people, primarily in Australia and New Zealand.

The services Downer delivers for our customers touch the lives of millions of people across Australia and New Zealand every day. However, Downer’s social relevance is deeper than the services we provide. Our size, scope and geographic footprint provide us with a unique platform to make communities better.

As one of Australia’s largest employers, we are a people business. We are committed to a workplace environment where our people feel included, where their health and wellness are supported, and where they have opportunities to develop new skills and grow their careers.

We pride ourselves on being a good corporate citizen through the actions we take and the support we provide to ensure our operations have a minimal impact on the environment.

In addition, sustainability is integrated into Downer’s business strategy and shaped by our four Pillars.

Downer leverages our understanding of Environment, Social and Governance mega-trends and key material sustainability issues to drive innovation and identify new sources of growth and revenue for the business. This includes the pivot of our portfolio to focus on our Urban Services businesses, positioning Downer as the provider of choice to customers with services set to thrive in a low carbon future.

Our approach is guided by the GRI’s principles for informing report content: materiality, completeness, sustainability context and stakeholder inclusiveness. A focus of this report is to demonstrate how we deliver sustainable returns while managing risk and being responsible in how we operate.

We engage with our internal and external stakeholders to ensure we understand, and report on, our sustainability risks and opportunities. Our comprehensive independent materiality assessment ensures our sustainability performance and reporting continues to align with the priorities of our stakeholders.

Downer has engaged KPMG to provide limited assurance over selected sustainability indicators to assess whether they have been prepared in accordance with Downer’s policies and procedures, and the GRI Standards.

These selected sustainability indicators are:

• Lost Time Injury Frequency Rate and Total Recordable Injury Frequency Rate
• Total direct (Scope 1) and indirect (Scope 2) GHG emissions
• Total energy consumption and production
• Significant environmental incidents (Category 4+)
• The total number and value of safety and environmental related fines paid or prosecutions
• Science-Based Target (SBT) Scope 1 and 2 Greenhouse Gas Emissions Intensity (tonnes CO2-e/AU$m)
• Hours delivered for Indigenous Cultural Awareness, Te Ara Whanake and Te Ara Maramatanga training
• Employees trained annually in Downer’s Mental Health First Aid (MHFA) training course.

Downer is committed to reporting our sustainability performance annually and consistently improving our data and information collection processes to ensure better quality data and insights. Numbers presented throughout this report may be rounded up or down to the nearest decimal place. Therefore presented totals may appear misaligned against the sum of their parts, due to the impacts of rounding.

Downer discloses all environmental and safety fines received and paid during FY22 as well as those received post 30 June 2022, but prior to publication of the Sustainability Report, that relate to events that occurred in FY22. In addition, if a fine is received, but not paid, after 30 June 2022 but prior to the publication of the Sustainability Report, that relates to an event that occurred in FY22, Downer will disclose the particulars of the event as well as an estimated fine value, but this will not be included in the FY22 metric.

All prosecutions known before the publication of the 2022 Sustainability Report have been disclosed.

Downer’s holistic approach to sustainability is summarised in the diagram below.

Our commitments to sustainability are outlined in our policies, which are accessible here. 

A core element of Downer’s sustainability approach is to focus on our customers’ success. Our core operating philosophy, ‘Relationships creating success’, encapsulates this theme.

Downer operates in sectors that are closely connected to the investment that is being driven by population growth, urbanisation and decarbonisation. These sectors include roads, rail, light rail, other public transport, power, gas, water, telecommunications, health, education, defence and other government sectors.

These sectors are served by Downer’s Urban Services businesses – Transport, Utilities, and Facilities. These businesses have demonstrated strength and resilience, hold market-leading positions and have attractive medium-term and long-term growth opportunities. They have a high proportion of government and government-related contracts and a capital light, services- based business model, with a lower risk profile and are generating more predictable revenues and cash flows.

Downer’s Urban Services strategy delivers many environmental and social benefits including a move to lower capital intensive and lower carbon activities, which support Downer’s decarbonisation pathway. Downer completed the sale of its Open Cut Mining East business in December 2021. This finalised the divestment of Downer’s former Mining Services Business Unit.

We are also committed to a Zero Harm culture, and we firmly believe that our work can be conducted with zero harm to our people, the environment and the communities in which we operate.

In addition, sustainability is integrated into Downer’s business strategy and shaped by our four Pillars: Safety, Delivery, Relationships and Thought Leadership.

Downer supports this approach, and was pleased to see the recent announcement that the Global Reporting Initiative has signed a Memorandum of Understanding to work hand-in-hand with the International Sustainability Standards Board. This year, Downer has undertaken a review of the Integrated Reporting Standards and the SASB standard, two frameworks that have aligned with the International Sustainability Standards Board, to see where we could pivot and align our disclosures.

Another framework Downer continues to monitor is the progression and implementation of the European Union Green Taxonomy. The EU Green Taxonomy provides a common classification system for sustainable economic activities allowing organisations to report on their percentage of sustainable revenue, sustainable CAPEX and sustainable OPEX.

The new committed facility has been structured to enhance the debt maturity profile, reduce average borrowing costs and provide flexibility as Downer Group continues to reshape its organisation in line with our Urban Services strategy. The sustainability aspect of the facility is underpinned by KPI metrics relating to Downer’s greenhouse gas emissions reductions and social sustainability that, if realised, will lead to a reduction in borrowing costs under the facility. These sustainability KPIs are unique to Downer and reflect the Group’s continued commitment to its sustainability performance and investment in its people.

For more information, refer to: http://www.downergroup.com/sustainable-finance.

The materiality assessment Downer conducted in 2021 identified the following top eight SDGs, ranked in order of priority, to which Downer has the greatest contribution:

Downer contributes to the SDGs in four important ways:

• Through our services and products
• By responsibly operating our business
• Through our capability and thought leadership
• Through our social responsibility activities and community involvement.

Downer’s sustainability targets are the tangible reflection of the organisation’s contribution to the SDGs. A full description of activities that feed into each target can be found throughout this report.