Management of environmental issues

One of the main objectives of the Group’s environmental policy is to ensure that our manufacturing operations worldwide are managed responsibly, in materially full compliance with all relevant laws and regulations, and that environmental damage or nuisance does not occur as a result of our activities. The Group continually reviews and evaluates its processes and practices and, where possible, takes action to reduce any potential impact of its operations on the environment. As a consequence of this ongoing programme of evaluation, the following action has been taken.

• A full environmental self-auditing programme was completed by all of the Group’s operations in 2005 and the environmental standards are now included as a policy document within the Group Risk Manual. The assessment process will be repeated in 2008 to ensure that a continuous progression of standards is being maintained, and to evaluate those businesses that have joined the Group since 2005 and address any emerging issues that the audit identifies.
• The Bonar Floors facility at Bamber Bridge, Lancashire, is scheduled to achieve the environmental accreditation ISO 14001 in 2008.
• The installation of bio filters at the Bonar Floors facility in Chateau Renault was completed in 2007 to ensure compliance with EU directives 84/360/EC (struggle against atmospheric pollution) and 2004/42/EC (reduction of volatile organic compounds). The use of the bio filter has removed the need for a thermal burner at the facility which would have avoided the consumption of 41,000m3 per annum of gas and the deposit of 99 tonnes of C02 into the atmosphere.
• The Group has undertaken a review to identify asbestos within all of its locations. Where asbestos materials are detected, they have either been removed or steps have been taken to manage the situation.
• Recycling programmes for both process and general waste are actively encouraged throughout the Group to maximise the efficient use of raw material. Our Floors operations have substantially increased the recycling capabilities of their in-process waste systems, reducing not only waste to landfill but their use of virgin raw materials. The Colbond unique non-woven backing for the carpet manufacturing industry, Colback SMR, is made of 100% post-consumer recycled bottle scrap, sourced locally to the factory in order to reduce the environmental impact of transport.

The Group remains a member of the Valpak packaging scheme for its UK subsidiaries, and fully meets the requirement of the packaging waste obligations.

The Group remains committed to the assessment of its use of hazardous substances with the aim of replacing these with safer alternatives where appropriate.

The Group currently does not have any outstanding environmental enforcement requirements or regulatory notices imposed at any of its manufacturing facilities.

The Group’s disaster contingency plans, which include the effective control of any potential environmental incidents are reviewed and updated on a regular basis.

The Group retains, from the sale of its North American packaging operations in 2000, some responsibility for the remediation of known environmental contamination in the vicinity of one of the facilities in Burlington, Ontario. Further details are provided in note 31 to the accounts.

Investigation of environmental controls of the Group’s businesses continues to be a part of the due diligence process for all potential acquisitions, with surveys being conducted at an early stage in the assimilation of acquisitions to ensure the Group’s high expectations are met. Detailed environmental due diligence was undertaken prior to the acquisition of Mehler AG in November 2007.

The Group continuously considers the environmental impact of processes when developing new products. The environmental properties of the products we manufacture will be considered at each stage of the introduction and manufacture of all new products.