SThree : Climate Change 2022 Report

Sthree Plc - Climate Change 2022

C0. Introduction

C0.1

(C0.1) Give a general description and introduction to your organization.

SThree plc is the global STEM-specialist talent partner that connects sought-after specialists in life sciences, technology, engineering, and mathematics with dynamic organisations across the world. We are the number one destination for talent in the best STEM markets; operating across 14 countries with over 2,700 colleagues supporting over 8,000 clients.

SThree plc is quoted on the Premium Segment of the London Stock Exchange under the ticker symbol STEM.

C0.2

(C0.2) State the start and end date of the year for which you are reporting data.

	Start date	End date	Indicate if you are providing emissions data for past reporting	Select the number of past reporting years you will be providing emissions data
			years	for
Reporting	December 1	November 30	Yes	2 years
year	2020	2021

C0.3

(C0.3) Select the countries/areas in which you operate.

Austria

Belgium

France

Germany

Ireland

Japan

Luxembourg

Netherlands

Singapore

Spain

Switzerland

United Arab Emirates

United Kingdom of Great Britain and Northern Ireland

United States of America

C0.4

(C0.4) Select the currency used for all financial information disclosed throughout your response.

GBP

C0.5

(C0.5) Select the option that describes the reporting boundary for which climate-related impacts on your business are being reported. Note that this option should align with your chosen approach for consolidating your GHG inventory.

Financial control

C0.8

(C0.8) Does your organization have an ISIN code or another unique identifier (e.g., Ticker, CUSIP, etc.)?

	Indicate whether you are able to provide a unique identifier for your organization	Provide your unique identifier
	Yes, an ISIN code	ISIN GB00B0KM9T71
	Yes, a Ticker symbol	Ticker - STEM

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C1. Governance

C1.1

(C1.1) Is there board-level oversight of climate-related issues within your organization?

Yes

C1.1a

(C1.1a) Identify the position(s) (do not include any names) of the individual(s) on the board with responsibility for climate-related issues.

Position of	Please explain
individual(s)
Chief	The Board is responsible for setting the direction of SThree's business strategy with respect to ESG matters, including climate change, setting climate-related targets and assessing and managing
Executive	climate-related risks and opportunities. The Chief Executive Officer, who sits on the Board, has overall responsibility for sustainability related matters, including climate-related issues and is
Officer	responsible for reporting to shareholders and the Board. The Chief Executive Officer's Executive Committee ("ExCo") is responsible for implementing the sustainability strategy programme and
(CEO)	ensuring the delivery of its commitments, goals and targets in this space. To support the ExCo, the Board has appointed a Group ESG Committee, with attendees including Executives, senior
	management, Non-Executives, as well as key influencers and external advisors. Example of climate-related decision: In 2021 the ESG Committee, established by the CEO, appointed external
	consultants, and formed an internal steering group to support the delivery of climate-related scenario analysis. The ESG Committee reviewed climate-related scenario analysis, and integrated climate
	change as an emerging risk within SThree's risk framework. The CEO appointed the Chief Financial Officer, an executive Board member, as the executive sponsor for climate risk in the business.

C1.1b

(C1.1b) Provide further details on the board's oversight of climate-related issues.

Frequency	Governance	Scope of	Please explain
with	mechanisms	board-
which	into which	level
climate-	climate-	oversight
related	related issues
issues are	are integrated
a
scheduled
agenda
item
Scheduled	Reviewing and	<>	SThree works closely with a third-party sustainability consultancy to stay abreast of climate-related issues, risks and opportunities. Regular environmental information such
- some	guiding	Applicabl	as changes in legislation, climate risks and opportunities, and performance monitoring of climate targets and annual emissions are reviewed and discussed by the ESG
meetings	strategy	e>	Committee 4 times per year. The Group ESG Committee includes Executives, senior management, Non-Executives, as well as key influencers. The committee is
	Reviewing and		responsible for relaying relevant information to the ExCo in order to make decisions and to the Board to receive strategic direction and keep the Board up to date with
	guiding major		material issues for the business. To reflect the importance of the topic executive board members have climate related KPIs. An example of progress made recently by the
	plans of action		ESG committee, was the decision to establish an internal global renewable energy leadership network. This was a direct outcome established in 2021 as a result of
	Reviewing and		undertaking climate scenario analysis. In addition, PwC audits SThree's SECR Report every year and the board has visibility of the SECR report.
	guiding risk
	management
	policies
	Reviewing and
	guiding annual
	budgets
	Setting
	performance
	objectives
	Monitoring
	implementation
	and
	performance of
	objectives
	Monitoring and
	overseeing
	progress
	against goals
	and targets for
	addressing
	climate-related
	issues

C1.1d

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(C1.1d) Does your organization have at least one board member with competence on climate-related issues?

	Board	Criteria used to assess competence of board member(s) on climate-related issues	Primary reason for	Explain why your organization does not have at
	member(s) have		no board-level	least one board member with competence on
	competence on		competence on	climate-related issues and any plans to address
	climate-related		climate-related	board-level competence in the future
	issues		issues
Row	Yes	Our CFO is the Chair of our TCFD Steering Committee and Executive Sponsor of climate risk for the group due
1		to his experience and exposure to risk management during previous roles in other listed firms. Over 14 years'
		experience as a listed company CFO. He is also best placed to assess and monitor the financial impact of
		climate risk due to his finance experience and proven track record as CFO.

C1.2

(C1.2) Provide the highest management-level position(s) or committee(s) with responsibility for climate-related issues.

Name of the position(s) and/or	Reporting line	Responsibility	Coverage of	Frequency of reporting to the board on climate-related
committee(s)			responsibility	issues
Chief Executive Officer (CEO)	<>	Assessing climate-related risks and opportunities		Quarterly
	Applicable>
Corporate responsibility committee	<>	Both assessing and managing climate-related risks and		Quarterly
	Applicable>	opportunities
Environment/ Sustainability manager	<>	Both assessing and managing climate-related risks and		Quarterly
	Applicable>	opportunities
Other committee, please specify (Risk	<>	Assessing climate-related risks and opportunities		Annually
Committee)	Applicable>
Other committee, please specify (Audit	<>	Assessing climate-related risks and opportunities		Annually
Committee)	Applicable>

C1.2a

(C1.2a) Describe where in the organizational structure this/these position(s) and/or committees lie, what their associated responsibilities are, and how climate- related issues are monitored (do not include the names of individuals).

The Chief Executive Officer: The Chief Executive Officer who sits on the Board, has overall responsibility for sustainability related matters, including climate-related issues and is responsible for reporting to shareholders and the Board. The CEO is ultimately responsible for both assessing and managing climate-related risks and opportunities. To reflect this responsibility, a monetary bonus linked to the achievement of company-wide carbon reduction targets was established for the CEO. To support the CEO in this role, the Exco has appointed a Group ESG Committee, with attendees including Executives, senior management, Non-Executives, as well as key influencers to ensure the wider business is represented. The responsibilities of the Group ESG Committee is to provide direction in relation to climate-related risks and opportunities and to recommend the implementation of initiatives across its global portfolio. The CFO has been appointed as the executive sponsor of climate risk to support the CEO and the ESG Committee with the management of risk mitigation. Each appointed member of the Group ESG Committee has oversight of key business functions within SThree, providing comprehensive coverage of climate-related issues across the business.

The Chief Financial Officer:The CFO sponsors climate-related scenario analysis across the group which was published in March 2022. The CFO ensures climate change is identified as an emerging risk in SThree's Enterprise Risk Management Framework and is the executive sponsor who ensures climate risks are monitored and mitigated as required.

Head of ESG:The Head of ESG is responsible for implementing SThree's overarching sustainability strategy, including undertaking target-setting ensuring compliance with all environmental legislation across its global markets. They manage the annual emissions reporting process and are responsible for improving SThree's performance year on year. The Head of ESG is responsible for the implementation of TCFD. The Head of ESG needs to ensure that climate change risk owners are in place and mitigating the identified risks, as well as opportunity owners, which inform strategic planning. Monitoring increases in utilities consumption, source of energy supply (e.g renewable electricity), and the associated increase in operating costs is an example of monitoring climate related risks.

Group Chairman:The Chairman of the Board sits on the ESG Committee to give insights and advice related to the Board's main strategy. They ensure the committees decision-making is reported to the board and that any climate-related risks and opportunities are reported appropriately.

C1.3

(C1.3) Do you provide incentives for the management of climate-related issues, including the attainment of targets?

	Provide incentives for the management of climate-related issues	Comment
Row 1	Yes	N/A

C1.3a

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(C1.3a) Provide further details on the incentives provided for the management of climate-related issues (do not include the names of individuals).

Entitled to	Type of	Activity	Comment
incentive	incentive	incentivized
Chief	Monetary	Efficiency	Financial incentives are in place and are awarded based on good performance against a number of KPIs across a range of factors under a balanced score card approach.
Executive	reward	target	These KPIs incorporate ESG/CSR aspects and bonuses are awarded based on performance against these KPIs. Whilst most KPIs are individual, some high-level KPIs which
Officer			apply generally to management, including the most senior, include: - Helping the business to reduce carbon emissions by 20% by 2024. - Helping to improve office
(CEO)			engagement in carbon data capture and behaviour change.
Other,	Monetary	Efficiency	The Head of ESG has specific KPI's around the following areas: - Compliance with all relevant environmental legislation. - Engaging employees, particularly around
please	reward	target	environmental behaviour change. Achieving these KPI's is rewarded with a monetary bonus for the Head of ESG.
specify
(Head of
ESG)
Corporate	Monetary	Efficiency	Financial incentives are in place and are awarded based on good performance against a number of KPIs across a range of factors under a balanced score card approach.
executive	reward	target	These KPIs incorporate ESG/CSR aspects and bonuses are awarded based on performance against these KPIs. Whilst most KPIs are individual, some high-level KPIs which
team			apply to all management employees include: - Helping the business to reduce carbon emissions by 20% by 2024. - Helping to improve office engagement in carbon data
			capture and behaviour change.

C2. Risks and opportunities

C2.1

(C2.1) Does your organization have a process for identifying, assessing, and responding to climate-related risks and opportunities?

Yes

C2.1a

(C2.1a) How does your organization define short-, medium- and long-term time horizons?

	From (years)	To (years)	Comment
Short-term	0	5	N/A
Medium-term	5	15	N/A
Long-term	15		N/A

C2.1b

(C2.1b) How does your organization define substantive financial or strategic impact on your business?

We use quantifiable indicators to measure financial impacts, including operating profits (£61m in the reporting year) and operating costs (£295m in the reporting year). A 'substantive financial impact' is defined as one that:

• Leads to 5% reduction in operating profits
• Leads to a 5% increase in operating costs
• Impacts 5 or more offices

A 'substantive strategic impact' is defined as any risks that reduces the ability of the Group to meet its short, medium, and long-term objectives.

C2.2

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(C2.2) Describe your process(es) for identifying, assessing and responding to climate-related risks and opportunities. Value chain stage(s) covered

Direct operations

Risk management process

Integrated into multi-disciplinarycompany-wide risk management process

Frequency of assessment

More than once a year

Time horizon(s) covered

Short-term

Medium-term

Long-term

Description of process

A standardised framework is used across the business to ensure risks, including those related to climate change, are identified, analysed, monitored and reported in a consistent manner The risk evaluation process is overseen by the Board, including for climate-related risks at both a company and asset level. This provides a consistent and systematic approach to understanding and mitigating against climate-related risks (current and future) that may have a substantive financial or strategic impact on the Group's ability to achieve its business objectives. Risks are identified, documented, assessed in the short, medium and long term and action is taken to implement mitigation. Climate change & associated risks currently included in the Group's risk matrix sit in the low risk and low impact quadrant. Transitional risk case study: As we transition to a net zero economy, we expect increased policy and regulatory requirements. SThree has worked with a third-party sustainability consultancy since 2016 to stay abreast of legislative developments, industry best practice and potential climate change related risks to our business. This starts with the identification of the environmental aspects of our operations which we can control. Our ESG team and our consultants work to identify the risks and opportunities related to these aspects to our business. Any event or circumstance that could prevent the Group's business objectives or goals being achieved are included in the scope of the risks assessment to provide visibility of the risk. Risks are prioritised by way of the Group's ERM processes, with the size and materiality of each risk assessed and compared using their likelihood and potential financial impact. Those scoring high on both measures being prioritised in terms of mitigation effort. For example, in 2021 whilst undertaking a climate scenario analysis with our third-party consultancy, we identified that the growth of green innovation will create new STEM job opportunities, however there is a risk that we lose market share if we do not respond quickly enough to these new opportunities. Whilst assessing this risk, we identified that employment in energy efficiency globally could expand from under 10 million to 29 million by 2030, while upgrades of grids and energy system flexibility would likely see employment increase over the same period from 7.4 million to 12 million. We respond to this risk by continuously reviewing the markets, introduced new energy market insight tools, and ensure we understand large tenders coming to market, which will allow us to map out recruitment requirements at each stage.

Value chain stage(s) covered

Direct operations

Risk management process

Integrated into multi-disciplinarycompany-wide risk management process

Frequency of assessment

More than once a year

Time horizon(s) covered

Short-term

Medium-term

Long-term

Description of process

A standardised framework is used across the business to ensure risks, including those related to climate change, are identified, analysed, monitored and reported in a consistent manner The risk evaluation process is overseen by the Board, including for climate-related risks at both a company and asset level. This provides a consistent and systematic approach to understanding and mitigating against climate-related risks (current and future) that may have a substantive financial or strategic impact on the Group's ability to achieve its business objectives. Risks are identified, documented, assessed in the short, medium and long term and action is taken to implement mitigation. Climate change & associated risks currently included in the Group's risk matrix sit in the low risk and low impact quadrant. Physical risk case study: Physical climate-related risks pose a threat to our profitability. Whilst undertaking a climate scenario analysis, we identified the risk that as global temperatures rise our reliance on cooling will increase. It is predicted that cooling requirements could triple by 2050 (fossil fuelled future scenario). This would lead to increased operating costs, increased offsetting costs to purchase carbon credits to offset the increase in carbon emissions, reputational damage, among others. As a result of assessing this risk, we have committed to targets to move our property portfolio to 100% clean energy which will reduce the environmental impact of increased cooling.

C2.2a

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