Why invest in Greencore
- In this section
The Group uses a set of Key Performance Indicators (‘KPIs’) to measure the performance of its operations and of the group as a whole.
The Group has identified these non-financial KPIs to measure progress of our strategic priorities and sustainability agenda. The Strategic Report and Sustainability Report provide further detail on the measurement, monitoring and improvement actions of our non-financial measures. These measures are all for continuing operations post the US disposal and have been adjusted to include a full year effect of Freshtime where possible.
Keeping our colleagues healthy and safe is a top priority for the Group. We aim to achieve this by continuing to develop a strong safety culture driven by management and employees at every level. The Group uses the Accident Incidence Rate (‘AIR’) to provide a guide of our health and safety performance.
Throughout FY19, the Group developed its culture of reporting minor accidents. This led to a slight increase from 0.51 in FY18 to 0.52 in FY19 in our AIR ratio per 100 employees in the UK.
Driving employee engagement is a key output of our people strategy. The employee engagement measure provides insight into how our people are committed to the Group’s goals, how motivated they are to contribute to its success and importantly, how they are feeling about their own well-being.
In FY19, our employee engagement, which was measured using slightly enhanced methodology, decreased by 3% since the last survey, which was conducted in FY17. The Group has prioritised initiatives to improve engagement including increasing employee communication through pulse surveys and colleague forums.
The product innovation measure shows our ability to broaden our product proposition. It supports the Group’s strategic priority to drive growth in an expanding food to go market. It is central to our commercial model and deepens our relevance to customers. The Group has a large team of highly skilled chefs and food technologists, who are constantly innovating and developing new products for our customers and consumers.
This year our innovation rate increased to 47%, measured from a base of over 2,400 different products across 20 different categories. This result was supported particularly by increased demand from customers for meat alternative products.
Building our customer relationships underpins the Group’s strategic priority to deepen customer relevance. An important component of measuring this is our service level. We track our service level by measuring the product we deliver to customers, on time and in full, compared to what they ordered from us.
We continually meet high levels of service and have maintained an average service level across the Group of 98.2% (same as FY18).
Producing safe, authentic and excellent quality food is central to everything we do. The Group uses the British Retail Consortium Global Standard in Food Safety (the ‘BRC’) to measure its food safety levels. The BRC standard is recognised by the Global Food Safety Initiative. The BRC standard provides a level of competence in all aspects of food safety and testing is carried out through unannounced audits on food safety, quality and operational criteria at each of our sites.
In FY19 all of our manufacturing units achieved the AA+ or A+ BRC grade. For the second consecutive year, the Group has met the highest level of food safety performance.
Managing food waste is a top priority across our operations. Our aim is to address food waste through prevention, redistribution and use in animal feed. We have committed to reducing food waste to 5.35% of total food production by 2030 to meet the UN Sustainable Development Goal target.
Through a programme of waste avoidance and food distribution initiatives, we continually reduce our food waste. Our food waste reduced by 1.3% from 10.5% in FY18 to 9.2% in FY19.
The remuneration of Executive Directors is aligned closely with our financial KPIs through the Company’s Performance Share Plan (‘PSP’) and Annual Bonus Plan (‘ABP’). The performance element of the PSPs is measured on two fundamental KPIs, ROIC and Adjusted EPS, as well as Total Shareholder Return. The financial performance element of the ABP is also measured on ROIC and Adjusted EPS, however, for awards granted from FY20 onwards, they will be replaced with Adjusted Operating Profit and Free Cash Flow. Therefore, from FY20, four out of the six financial KPIs will be used to monitor the performance payouts. The performance against all of the financial and non-financial KPIs is taken into account when considering the personal and strategic element of the ABP. Further information can be found on page in our Report on Directors’ Remuneration.