ESG Investor FAQs

ESG and our shareholders

We recognise that there are parts of our business model of particular relevance to investors when looking at ESG matters, most notably that we operate in the defence and nuclear markets. Below we highlight some frequently asked questions from our shareholders:

  • We do not design, manufacture, maintain or deal in nuclear weapons or their components
  • We do, however, manufacture and assemble components which form part of the common missile compartment for the new UK Dreadnought and US Columbia Class Submarine programmes
  • We also design and manufacture torpedo handling and ejector systems for the UK Dreadnought Class submarines
  • Work related to these two areas of manufacture were less than 2% of Group revenue for the year ended 31 March 2021

Babcock provides maintenance and through-life support for the UK’s fleet of nuclear powered submarines including those which form part of the UK Continuous At Sea Deterrent. We also own and operate critical infrastructure and have technical knowledge of the defence nuclear market. We will continue to support both our UK defence customer’s defence priorities

Work related to these areas of support for the wider UK fleet and infrastructure represents the defence revenue in our Nuclear sector, approximately 20% of FY21 Group revenue

We do not make or deal in other weapons

We do, however, design and manufacture weapons handling and launch systems for international naval platforms used by the UK, Spain, Canada, Korea and Australia

We also have contracts to maintain the UK Royal Navy’s naval guns and defensive close-in weapon system

Work related to these areas of support and manufacture represented less than 2% of Group revenue for the year ended 31 March 2021

Yes, nuclear power provides a reliable source of low-carbon electricity and is a critical component of countries’ energy strategies as they move towards net zero carbon and we continue to support the UK Government’s commitment to civil nuclear power generation

Our civil nuclear business is involved in new build, power generation support, fuel route management and decommissioning in the UK nuclear market

We also use technical knowledge and reference cases to undertake consultancy work in Canada and Japan, albeit at a small volume currently

Work related to these areas represented approximately 4% of Group revenue for the year ended 31 March 2021

Yes, we have an ESG team that reports into our Chief Corporate Affairs Officer who is part of our Executive Committee

Three of the Group’s key performance indicators are linked to our ESG strategy: (i) Total injuries rate, (ii) CO2 emissions, and (iii) Senior management gender diversity

We have two main targets as part of our ESG strategy: (i) to be net zero (scope 1 and 2) by 2040, and (ii) for at least 30% of our senior management to be female by 2025