Our commitment to being a responsible business (including TCFD)

Strategic Report
Governance
Financial Statements

Ourcommitment
to being a
responsible
business

ESG targets
and progress
Since FY20 we have monitored our ESG performance against key targets that align tothe areas most material to our business, reflecting our business model and stakeholder
priorities. Our ESG targets contribute to the success of our business, aligned with ourstrategic pillars.
In addition, we undertook analysis to understand the UN SDGs that we can impact, andaligned our strategy to deliver relevant outcomes to the targets and indicators establishedwithin the SDG framework.
Reduce scope 1 & 2 emissions
by 77% and absolute scope 3
emissions by 50% by FY30

We aspire to increase
representation of women in
leadership to 50/50

To positively impact
150,000 lives by FY24

Doubling the share of our global
renewables business by FY24

Progress

114,466 lives positively
impacted by SThree since
1 December 2019.

142% growth in our clean
energy business net fees
since FY19 (baseline year).

31% increase in scope
39% women in leadership
1 and 2 and 12% reduction in positions*.
scope 3 in FY23 from FY19
(baseline year).

FY23 activities

15,292 accessed decent
work through SThreeplacements.

28% growth in our clean
energy business net fees
YoY in FY23.

26% increase in absoluteemissions in FY23 incomparison to FY22 due toa return to pre-pandemic
operations.

47 women participatedin our leadership talentdevelopment programme
Identify.

Our Places

Our Platform

Our People

431 accessed our career
support programme.
2,754 existing and aspiring
STEM professionals
accessed Elevate Careers
programme with coaching
and mentoring support
provided by SThree.
3,094 hours of volunteering
supported people in our
local community.
Alignment tostrategic pillars

Our Position
Our People

Sustainable
Development
Goals

Case study

For more information on our Responsible
Business practice, please see a case study on
our partnership with Earthly on our website:sthree.com/annual-report-2023

52

SThree plc*

In FY23, we reviewed our definition of women in leadership and aligned it to the FTSE Women on Boards Leadership index/recommendation which defines leadership as
Executive Committee and Executive Committee minus one (excluding administrative roles). As of FY23, SThree adopts this definition, and our data is reflective of this within
this Annual Report.

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Strategic Report
Governance
Financial Statements

Building an
inclusive
future foreveryone

Elevating our people

In FY23, we continued to build a high performing, inclusive
culture. People remain a fundamental part of our core strategy,
enabling our performance and heightening the impact wehave on all of our stakeholders. In FY23, we continued to makeprogress in the following areas:••

Our purpose of bringing skilled
people together to build thefuture is focused on empowering
people to reach their full potential
whilst using their skills to drive
innovation and progress acrossthe world. Our social impact
goes beyond our colleagues
and candidates, deliveringoutcomes for all stakeholders andcontributing to the UN Sustainable
Development Goals.”Gemma Branney
Global Director of Purpose and Inclusion

54

SThree plc

We understand that company culture is ever evolving andwe continue to prioritise the development of our own culture
across the global business. Over 150 colleagues delivered
internal networks and activities to enhance our culture.
This includes activities surrounding International Women’sDay, Black History Month, World Environment Day, as wellas touch points throughout the year. In addition, in the US
and UK we launched a new data capture process to enable
colleagues to share their race and ethnicity data with thebusiness, improving our insights surrounding diversity,
informing future priorities for the business. In FY24 wewill continue to embed DE&I data collection across ourglobal business to ensure we can align to the Parker
Review requirements.
Colleague engagement continues to be a KPI for thebusiness, a metric which provides important insights inrelation to development, retention and productivity. In FY23,
we conducted regular town halls to inform our people,
delivered eight focus groups with our ExCo members, four
focus groups with Non-Executive Directors, delivered culture
co-creation workshops with 15% of our people and delivered
our Engage survey achieving an eNPS of 43 (FY22: 51 points).
Active listening has been a key part of our People Strategy in
FY23, ensuring colleagues’ voices contribute to the evolutionof our culture.

•

Our SThree Academy continues to be a significant resource
for colleague development alongside in-person training
and regular performance reviews which include personal
development planning. In FY23, our colleagues accessed
41,264 hours of learning.

•

Our ambition is to achieve 50/50 representation of womenin leadership. In FY23, we launched the third cohort of ourtalent accelerator programme with 47 women participating.
The programme increases engagement, retention andlikelihood of promotion of women.

“ I’ve found my journey with the Identify programme
to be immensely enriching. This initiative has not only
granted me access to a diverse array of specialised
training and webinars hosted by inspiring external
speakers but also facilitated connections withremarkable women from around the globe who sharesimilar values and goals. I truly enjoyed the external
mentorship, where I delved into topics that were
important to me on a professional level.”
Esther Wilz
Commercial Manager, SThree Berlin

Elevating careers

In FY23, we brought together the numerous community
programmes we deliver into one high impact upskilling
programme aimed at diversifying the STEM talent pipeline,
Elevate Careers. Working in partnership with 39 partners,
including community organisations, industry bodies and clients,
we delivered activities to elevate the STEM careers of 2,754
people from diverse communities. Our programmes included
CV reviews, job search advice, skills development sessions andindustry panel events.
“	As a neurodivergent person, I always appreciate
people sharing how they advocate for themselves.
It’s something that can be challenging to navigate.”
Elevate Careers UK Workshop participant
June 2023“	This is the most helpful, transparent webinar for careertransition I’ve heard.”
Elevate Careers USA Workshop participant
October 2023

In FY23, we developed a global partnership with Women Who
Code, a charity whose mission is to empower diverse women to
excel in tech careers. SThree contributed £86,000 to fund 3,700
scholarships for women on their programme and ran workshops
for 1,239 women within the Women Who Code community.
Together we are supporting more women from diverse
backgrounds into tech careers, SThree’s largest STEM market.

Elevating our community

Contributing to our local communities is a long-standing part ofour corporate identity which is demonstrated by the 40 hours of
paid volunteering leave every colleague can utilise each year. In
FY23, 85 ESG Ambassadors arranged activities to support theirlocal community. This included raising £119,025, contributing
over 980 items as gifts in kind and volunteering 3,094 hours. Fulldetails of the organisations we support and the impact we have
had can be found on pages 10 to 18 in our ESG Impact Report.
“ Our colleagues have a strong ethos of doing good.
Their passion and energy to give back to their local
communities through fundraising, donating items,
skills sharing and using their 40 hours of paid volunteer
leave transforms communities and creates a better
future for everyone.”
Francesca Greaves
Global Purpose and Inclusion Manager

Case study

For more information on how we support
local communities, please see a case study
on our partnership with Aleto Foundationon our website:sthree.com/annual-report-2023

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Our commitment to being a responsible business (including TCFD) continued

Strategic Report
Governance
Financial Statements

STEM skills
fuelling a
low-carbon
futureThrough our materiality assessment
it is clear that climate change
is a critical topic to all of our
stakeholders. As a STEM staffing
specialist, we are committed tobeing led by climate science andour net zero targets reflect this.
We are committed to not only
reducing our impact but to providing
the STEM talent the world needs
to decarbonise.”

970

placements in clean energy

28%

YoY growth in our clean energy business8%

reduction in carbon emissions since FY19

The green skills that will build the future

Through climate-related scenario analysis we have identified thegrowing opportunity related to the role STEM skills will play inthe low-carbon transition. This is materialising as we have seen
our clean energy business grow by 142% since FY19, when we
set a target to double the size of our clean energy business tomaximise the opportunity identified.
McKinsey estimates 202 million new jobs may be needed todeliver net zero by FY50 and the LinkedIn Green Skills Report
2023 estimates the need for green skills is double the pace ofgreen talent entering the job market. Decarbonisation is one of
the most material megatrends impacting SThree.
For further details, see page 4

We continue to strengthen our position as a talent partner to
net zero, growing our sustainability credentials and throughpartnering with clients to address their green skills gap. In FY23,
we placed 970 candidates into clean energy roles.
In FY23, we continued to deliver green skills development
opportunities as part of our Elevate Careers programmes.
Throughout this year, 308 women attended workshops
delivered in partnership with Women in Renewable Industries
and Sustainable Energies (WRISE) and New England Women in
Energy and Environment.

Taking meaningful climate action

For over a decade SThree has shown a commitment to climate
action. In FY23, we strengthened our commitment throughsetting SBTi-verified targets.
For further details, see page 71

We demonstrate transparent reporting on our carbon emissions,progress towards our targets and our net zero roadmap which isdetailed within the following TCFD disclosures.

Andrew Beach
CFO and Executive Sponsor of climate risk

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Strategic Report
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Financial Statements

TCFD report
Task Force on Climate-related Financial Disclosures statement
SThree has supported the recommendations of the Task Forceon Climate-related Financial Disclosures (TCFD) since FY20.
We confirm that we are reporting consistent with all the TCFD
Recommendations and Recommended Disclosures in the Annual
Report and Accounts 2023.
By this we mean the four TCFD recommendations and the 11
recommended disclosures set out in Figure 4 of Section C of thereport entitled ‘Recommendations of the Task Force on Climaterelated Financial Disclosures’ published in June 2017 by the
TCFD. We have also considered the TCFD additional guidance(2021 TCFD Annex), specifically the ‘All Sectors Guidance’ inpreparing the disclosures. We are therefore compliant with therequirements of the UK Listing Rule 9.8.6(8)24.
This section contains the relevant disclosures or otherwise
provides cross-references where the disclosures are locatedelsewhere in the report. In preparing them we have had to makeseveral assumptions, and while we are satisfied that they are
consistent with the TCFD recommendations, we will continue
to monitor TCFD guidance as it evolves and will consider
opportunities to enhance our future disclosures.

Governance pillar

The Board appointed the Chief Financial Officer (CFO) as the
Executive Board member who acts as senior sponsor for all
climate-related matters including climate risk, metrics andtargets. The CFO reports progress to the Board on a regularbasis. With over 15 years’ experience as a listed company
CFO, extensive risk management knowledge, an active
member of the Group ESG Committee and Chair of the
TCFD Steering Committee, the CFO is best placed to ensure
the business assesses and monitors the impact of climate
risks and opportunities, informing business strategy andgrowth ambitions.
In addition, the Chief Executive Officer has appointed
an Executive Committee (ExCo) which includes the seniorleaders within the business. The purpose of the ExCo is to
direct the Group strategy including the achievement of
performance targets and mitigation of risks. The ExCo
conducts regular business reviews related to strategy,
risk management (including climate-related risks) andperformance including progress towards ESG targets.

The ExCo reports to the Board and escalates both risk and ESG
matters as appropriate. The Board reviews strategy at least twicea year.
In addition, the ESG Committee, which includes members of
the ExCo, with Non-Executive Directors’ attending on a rotationbasis, meets quarterly to discuss and report ESG specific topics.
These topics are then discussed at the Group Risk Committee,
ExCo, Group Remuneration Committee and the Board.

SThree plc

SThree’s ESG Committee has representatives from the ExCo,
including the Chief Executive Officer, Chief Financial Officer,
Chief People Officer and Chief Legal Officer, as well as
individuals from key strategic markets and departments.
The ESG Committee meets quarterly to direct the Group ESG
strategy, policies and implementation of key changes across thebusiness. This includes identifying climate risks and providing
oversight of the assessment and mitigation of these risks.
The review of climate-related risks occurred each quarter
during FY23.

During the reporting period, the Board agenda included:

In order to provide the right level of oversight to both climate risk
and opportunities, the ESG Committee has formed two subgroups which include:•

an update on ESG priorities and progress towards agreed
KPIs. The Board questioned business engagement andsupport, offering sponsorship of key ESG topics as required;••risk review, including discussing climate risk statements, risk
appetite, tolerance and Key Risk Indicators (KRIs);•

TCFD progress updates were provided by the CFO to giveassurance to the Board that we would meet all compliancerequirements. This provided an opportunity for the Board toquestion actions and progress, and influence the direction of
the TCFD Steering Committee as required;•discussed and agreed new science-based net zero targets
aligned to SBTi; andTCFD Steering Committee, formed in FY22, which
includes leaders from across the business with expertisein risk management, financial planning, strategy, ESG
and reporting. The TCFD Steering Committee provides
recommendations to the ESG Committee on the assessmentand management of climate risk, processes to ensure
climate risk informs financial and strategic planning, andthe governance of climate risk. During the current year,
the TCFD Steering Committee implemented 12 actions
to improve controls and processes of collating information
on how the climate-related risks and opportunities
impact SThree.

•

the Board discussed the role of the ESG Committee andin order to increase the Board’s oversight of ESG-related
topics, including climate risks and opportunities, the Board
agreed that a Non-Executive Director seat will be held on thecommittee in FY24.

•

Global Renewable Energy Network (GREN) includes energy
sector leaders from across the business who come together
to learn, share and collaborate on actions that improve theperformance of our renewable energy business, maximising
the opportunities identified through scenario analysis andsupporting the achievement of performance targets. During
the reporting year, GREN continued to develop its reachacross SThree’s regions, promoting uniformed processes andbest practices in support of future growth of our renewableenergy business. GREN’s key initiatives completed in FY23
include global implementation of the new blueprint to guidea coordinated approach to grow our strategic clients; rollout of a job intensity dashboard and monthly newslettersproviding our leadership with critical insights.

24. In considering the consistency of our disclosures with the TCFD Recommendations and Recommended Disclosures we have had regard to, among other things, the documents
referred to in LR 9.8.6B and 6C, as applicable to the financial year 2023.

58

To oversee the governance of risk management, including
climate-related risks, the ExCo has formed a Group Risk
Committee. In addition, to support the management of climaterelated matters and wider ESG ambitions, the ExCo establishedan ESG Committee.

ESG Committee

Board oversight
TCFD recommendation: Describe the Board’s oversight of climate-related risks and opportunities.
The Board engages with stakeholders on matters of businessstrategy, performance and environment, social and governance(ESG), including climate change. Continuing to integrate ESG
impacts into the business and providing clear, transparent
reporting on ESG matters remains a priority for the Board. The
Board’s experience includes a range of skills and knowledge
in relation to risk management and risk-informed strategic andfinancial planning which supports the implementation of the
TCFD recommendations across the Group. Full details of theBoard’s experience can be found on pages 86 to 87. The levelof Board oversight is considered appropriate for the ESG risks
identified by the Group.

Management oversight
TCFD recommendation: Describe management’s rolein assessing and managing climate-related risks andopportunities.

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Our commitment to being a responsible business (including TCFD) continued

Strategic Report
Governance
Financial Statements

Climate change governance framework

Risks pillar
Identifying and managing climate-related risks
TCFD recommendation: Describe the organisation’s
processes for identifying, assessing and managing
climate-related risks.

SThree Board

Oversight of business strategy and performance, including material ESG factors.

Audit & Risk Committee

Oversight of the effectiveness of theGroup’s Risk Management systems
and processes. Reviews assurance
over mitigating controls.

Remuneration Committee

Nomination Committee

Oversight of the Group’s
remuneration policy and employee
incentive arrangements.

Oversight of continuing developmentof an adequate pipeline into the
Executive Team for succession andbench strength purposes.

CEO

Executive Committee

Undertakes regional reviews to identify risks and opportunities with regional leadership teams.
Responsible for the management of risks and recommending risk appetite to the Board.
Develops Company strategy in line with Board appetite.

ESG Committee

Identifies, assesses and mitigates climate risks andopportunities, ensuring integration into strategic andfinancial planning.

Global Directorof Purpose andInclusion

Implementation ofclimate-related scenario
analysis, and stakeholder
engagement to ensure
delivery of actionplans. Oversees thedevelopment of climate
targets anddata reporting.

Global Renewable
Energy Network

Energy sector leaders
who work on actions
that grow our renewableenergy business.

Group Risk Committee

Responsible for reviewing and assessing strength ofcontrols related to climate risks and reporting updates onrisks to the Executive Committee, Audit & Risk Committee
and the Board.

TCFD Steering
Committee

Providesrecommendations to
the ESG Committee
on the assessment andmanagement of climate
risk, informs financial andstrategic planning.

Climate Risk
OwnersResponsible for themonitoring of climate
risks, developing andimplementing mitigation,and escalating changes
within risk environment
to the Group
Risk Committee.

Our existing Group Risk Framework is designed to identify,
assess, score and monitor all risks. In addition, risk mitigationplans and timelines are determined by the appetite and tolerance
for risks as set by the Board and directed by ExCo.
A responsibility for identifying, assessing, and where appropriate
mitigating climate-related risks and opportunities is delegatedto the ESG Committee. The Committee’s approach toidentifying climate-related risks includes utilising market
research data, external partner insights and internal business
reviews. Our strategic review process asks senior leadersfrom across the business to identify any current or emerging
risks within their markets, with key questions around climaterelated market changes and policy. These are then discussed
at local management meetings and escalated to the ESG
Committee, who in turn, ensures the right mitigation measuresand controls are in place. In addition to our strategic review
process in FY23, we also renewed our materiality assessment,
conducting interviews, stakeholder surveys and desk research
to further identify risks and opportunities. Additional risks andopportunities were then reported to the ESG Committee,
informing risk management and mitigation priorities.
We utilise climate-related scenarios to assess the potential
magnitude and likelihood of specific climate-related risks andopportunities under the varied parameters and assumptions ofeach scenario, quantifying the financial impact on net fees, thesame financial metric used across the Group’s Risk Framework.
Once assessed, climate-related risks are assigned a risk owner
who is responsible for building and implementing the mitigation
controls related to that risk. The overarching mitigation control
involves tracking progress against targets using measurement
indicators, horizon scanning to identify changes that could
trigger additional transition risks and implementing procedures
and solutions to overcome them. This is reported on a quarterly
basis to the ESG Committee.
To date climate-related scenario analysis has demonstrated
that there are no immediate risks and therefore, climate change
continues to be an emerging risk to the business. However,some of the Group principal risks are, to an extent, impacted byclimate change, and therefore since FY22, where applicable,
our principal risks reflect elements of the climate-related risks
identified through scenario analysis. These risks are regularly
reviewed by the Group Risk Committee and twice a year by
the Board. Further details of these risks can be found in our
Risks section on pages 76 to 82 and more details around risk
management governance can be found on page 76.

Integration with Group’s Risk Framework
TCFD recommendation: Describe how processes for
identifying, assessing, and managing climate-relatedrisks are integrated into the organisation’s overallrisk management.
Climate change is an emerging risk to SThree and has thepotential, to varying degrees, to impact our business in the
short, medium and long term. We face potential physicalenvironmental risks from the effects of climate change, including
extreme weather events, alongside potential regulatory andtransition market risks associated with the shift to a low-carbon
economy. However, these also present opportunities.
The process for assessing and identifying climate-related risks
is the same as for all Group’s principal risks and is describedon pages 76 to 77. The risks are reviewed and assessed on an
ongoing basis, and formally at least twice a year, by the Group
Risk Committee. For each of our principal and emerging risks,
the Group Risk Framework details the controls we have in place,
who is responsible for managing both the overall risk and theindividual controls mitigating it. We monitor risks throughout theyear to identify changes in the risk profile.
In summary, the Group Risk Committee is responsible for:•evaluating, monitoring and reviewing principal and emerging
risks including climate-related risks;•

ensuring climate risk is integrated into the Group Risk
Framework;•

maintaining oversight of climate risks where they impact
Group principal risks; and•reviewing and assessing the strength of controls in place forclimate risk. This assessment is reported to the Board on abi-annual basis.

Any material changes relating to ESG matters, climate risk andtargets are also included within the Chief Financial Officer’s
statement (executive sponsor of climate risk) which is deliveredat each Board meeting.
Read about the Group’s Risk Framework on pages 76 to 77

ESG Ambassadors

100+ ambassadors across the business deliver local climate action,
engage colleagues in climate-related issues and provide local insights to the ESG Committee.

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Our commitment to being a responsible business (including TCFD) continued

Strategic Report
Governance
Financial Statements

Strategy pillar

Risk and opportunity identification and assessment

The impact of climate change on SThree
TCFD recommendation: Describe the impact of climate-related risks and opportunities on the organisation’s
business, strategy and financial planning.

TCFD recommendation: Describe the climate-related risks and opportunities the organisation has identified overthe short, medium, and long term.

We have the right strategy (see diagram 1), which is informedby climate risks and opportunities and includes our climatetransition plan to net zero.
Through climate-related scenario analysis we have identified
no immediate climate risks to our business, its strategy,
performance or liquidity. However, we understand theimportance of climate change on our stakeholders and therefore
the Group’s exposure to climate-related risks and opportunities
is regularly considered in our strategic and financial planning, ourcapital allocation decisions and in operational management. It
was also considered when preparing the Consolidated Financial
Statements, in particular as part of assessment of the Group’s
long-term viability and its flexibility to adapt operations toclimate-related risks and opportunities. For further details seenote 1 to the financial statements.
We also understand that climate change and its associatedimpacts are causing systemic and exponential disruption to
wider society. One of the global megatrends is decarbonisation
which requires extensive innovation and change. Climate change
will have a unique impact on our clients and the STEM skills theyrequire to redesign and innovate business models that align witha net zero future.

Our role in supplying the STEM skills, which are needed tofacilitate this change, is a key opportunity identified throughscenario analysis which has influenced our strategic priorities.
We are well positioned to respond to the growing demand forgreen skills and can quickly respond to growing demand forhighly skilled talent as the global economy reconfigures towards
decarbonisation.
In addition, the decarbonisation of our own business plays
an important role in ensuring we meet the requirements ofour clients and can access new business opportunities. As aresult, we have set carbon reduction targets and have been on
our journey to net zero since FY18. We have also embedded
sustainability criteria into our technology investments and, as
we implement new procurement processes, select new officefacilities and reimagine ways of working post the Covid-19
pandemic, we are integrating sustainable methods. This year wehave invested £3.0 million in these initiatives, primarily to fundenergy-efficient facilities and equipment in our new office inGlasgow, UK, and transitioning some of our technology to thecloud-based arrangements.

Guided by our climate-related scenario analysis, and risk
management articulated on pages 61 to 63, the climate-relatedrisks and opportunities that could have a potential impact on
SThree Group are detailed below, along with mitigating actions.
To assess the materiality of climate-related risks andopportunities, we used the following timeframes:•

short term: up to five years to 2028;•

medium term: five to 15 years from 2028 to 2038; and•long term: beyond 15 years from 2038 to 2050.

Our likelihood assessment is an estimated probability ofpotential impacts:•

low: very unlikely to unlikely;•

moderate: likely to occur; and•high: likely to very likely to occur.

These risks and opportunities are global in nature and there are
only modest variations in their relative significance for each of
our business segments. Where appropriate, we refer to specificgeographies. Based on potential financial or strategic impact, atpresent we identify no risks which will significantly impact ourlong-term strategy or business model, though management willcontinue to monitor our regional businesses’ performance andtheir response to climate events.
Refer to the subsequent section, Metrics & Targets on pages
72 to 74, for further information on measurement indicators,
including our performance against them.

Table 1. Our key climate-related risks and opportunities
Measurement
indicators

Risk/opportunity

Potential impact and SThree’s response

1. Transition Risk
Diagram 1. Here is how our strategic pillars shape our journey towards low-carbon economy

Market% net fees
generated from oil
and gas sector

Fossil fuel sector exposure

Our Places

In order to build our market position, we develop andnurture a diverse green skills pipeline to maintaincompetitive advantage as a talent partner to the transition
towards a low-carbon economy. In addition, within ourmarkets we select geographies with low physical climate
risks to minimise disruption to our people and contractors.

Our People

Attracting talent to our business and on behalf of ourclients; meeting the growing sustainability expectations ofcandidates to provide access to the best talent.

Less than 4% of net fees globally are derived from oil and gas
clients. Under a low-carbon transition, potential net fees fromthese clients could be lost due to divestment and reduction inclient demand. The risk to SThree would be two-fold on revenue
and operating expenses – a potential material loss of revenue, in
addition to still maintaining the consultant expenditure to recruit
into this area of the market when there are limited opportunities
available.
Business segments potentially affected:

Our Platform

Building operational efficiency to decarbonise
our value chain.

Our Position

Strengthening our position as a sustainable staffing
partner, meeting client, candidate, colleague and investor
expectations to grow our business.

Timeframe (term):
MediumLong

Moderate

High

Likelihood:
Low

Analysis by the International Energy Agency
shows that the majority of energy employment
is already driven by investment in clean energy
sectors. With a strong renewable energy
proposition, we believe we have already pivoted
our activities towards finding talent in these skill
sets and therefore see limited risk in the declineof hydrocarbon-based energy investment.
In FY24, we will continue to build our renewableenergy proposition through developing casestudies and proof points to demonstrate ourexpertise and commitment.

The US and the Netherlands

Short

In FY22, the ExCo agreed to an Energy Sector
Position Statement for the business which
outlined the key energy sector focus areas of
the business. This enables leaders to grow ourenergy business informed by risk.

Over the coming years we will also continue
to build the sustainability literacy levels of ourclient relationship teams to ensure they can fully
understand clients’ sustainability requirements
and can also explain SThree’s net zerocommitments.

Further information on risk and materiality assessment can be found in the Risk management section on page 76

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Our commitment to being a responsible business (including TCFD) continued

Strategic Report
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Financial Statements

Our key climate-related risks and opportunities continued
Measurement
indicators

Risk/opportunity

Potential impact and SThree’s response

Measurement
indicators

Risk/opportunity

4. Transition Risk

2. Transition Risk
Market
Maintaining market share in rapidly expanding markets
Decarbonisation continues to be a key megatrend in our business(see page 4). Through scenario analysis we have identified
opportunities for significant growth which could materialiseat pace, particularly under a renewable-led growth future (ourscenario analysis of 1.5˚C). There is a potential risk that we do notrespond quickly enough to maximise these opportunities and as aresult lose market share.

% net fees
generated fromclean energy
sectorFor details on potential impact and SThree’s
response, see Transition risk 1 (Market/Fossil fuelsector exposure) on page 63.

Reputation% reduction incarbon emissions

Changing candidate and client preferences
Environmental concerns are becoming increasingly front of mind
when candidates consider employers. There is a risk candidates
opt to work with staffing providers who can demonstrate strong
green credentials and SThree loses competitive advantage if we do
not align to candidate expectations.

% energy procured
from clean sources% clean fleet
within the
Company

Growing headcount will ensure we can meet the demand for
STEM skills in decarbonisation projects.
Business segments potentially affected:
Business segments potentially affected:

Group-wide

Timeframe (term):
MediumLong
Timeframe (term):

Likelihood:
Low

Moderate

Short

High

MediumLong

Low

MarketAddressing the multiple skills requirements of clients
As part of the low-carbon transition, clients require multiple STEM
skills within their business. The risk is that SThree could missopportunities to deliver across multiple skills within one client due
to our brand structure and how our delivery teams operate.
For example, demand for IT candidates to solve big data
challenges continues to rise rapidly across all industries,
particularly during the transition to a low-carbon future. Energy
clients require both engineering and tech skills which are two
specialisms separated into two different SThree brands rather than
one service supplier.
Business segments potentially affected:
Group-wide

MediumLong

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SThree plc

In addition, we began the introduction of our new
CRM system which will improve our data acrossboth clients and candidates. We also mobilised
a new client strategy following the appointmentof our new Chief Commercial Officer. Ourstrengthened approach to clients alongside
the new system will ensure opportunities are
identified and maximised, enabling our ability toservice clients across multiple skills and roles.
These projects will be ongoing throughout FY24
and FY25.

ModerateHigh

5. Transition Risk
Reputation
Operating within high-carbon industries
High-carbon emitting clients are increasingly facing divestment
and stranded asset risk as a result of changing consumer
preferences and government policies. The risk to SThree is
two-fold, loss of net fees from these clients and the reputational
damage of operating within high-carbon emitting sectors.

% net fees
generated fromoil and gas
placements

The Energy Sector Position Statement approved
by ExCo in FY22 defines how we operate within
high-carbon industries and the monitoring wehave in place to mitigate any potential risks
derived from this work. We monitor our workwithin high-emitting industries and reportbiannually to the ESG Committee. Any change
which may heighten the impact of risk isescalated to ExCo.

Business segments potentially affected:
Group-wide

Timeframe (term):
MediumLong

Moderate

High

Likelihood:
Low

Likelihood:
Low

Following a brand refresh we have improved
the interlink between our house of brands andcontinue to evolve our marketing to strengthen
our position as a holistic STEM talent pipeline. In
FY23, we continued to strengthen our position
through launching a tool to capture case studies
which enables our sales teams to highlight ourcredentials across sectors and skills.

Short

Timeframe (term):
Short

Number ofplacements madewithin clean
energyModerate

In FY23, we launched Elevate Careers which is asocial impact programme designed to diversify
the STEM talent pipeline. Through collaboratingwith clients, industry bodies, education andcharitable organisations we deliver programmes
to attract more talent into STEM roles, including
green skills. Through this work we grow ourcandidate pipeline but also highlight ourcommitment to talent development. In FY24,
we will be continuing to grow our collaboration
network surrounding green skills.

In FY24, mobilising regional carbon reduction
actions will be a key priority with annual
milestones and targets being implemented until
we achieve net zero.

Likelihood:

3. Transition Risk

The role we play in bringing skilled people
together to build a sustainable future is core to
our business and is demonstrated throughout ourmarket proposition.

We demonstrate a leadership position in
relation to our climate action which has been
demonstrated since setting our first carbon
reduction target in FY18. In FY23, we announced
SBTi-verified short-term and long-term net zerotargets. In addition, we maintained our CDP B
score, published our ESG Impact Report andcontinued to be listed in the FTSE4Good and in
the Financial Times Climate Leaders listing.

Group-wide

Short

Potential impact and SThree’s responseHigh

Annual Report and Accounts 2023

65

Our commitment to being a responsible business (including TCFD) continued

Strategic Report
Governance
Financial Statements

Our key climate-related risks and opportunities continued
Measurement
indicators

Risk/opportunity

Potential impact and SThree’s response

Policy and legal
Exposure to changing government
Some large energy and infrastructure projects are influenced
by government. To respond successfully to these tenders andwin contracts, SThree requires investment in consultants, andsometimes additional certifications.

% net fees
generated fromclean energy
sector

The risk, which is outside of SThree’s control, is that the level of
preparation work for large renewables projects is an investment
we must make as a potential vendor, however tender outcomesmay change. Often the timeline and budgets for these projects
are delayed and reduced. These changes are often in response tochanging government policies and priorities. This could result in
SThree having areas of operational costs which face delayed or
reduced revenue opportunities.

Timeframe (term):Long

Moderate

High

Increased carbon emissions

There are opportunities for SThree throughout
this timeframe, which often last for upwards offive years. SThree can evaluate over this timethe internal resources required to assist clients,
without committing to long-term costs whichhave a larger payback period.

The risks to SThree are:Through the GREN we will continue to build
resources and tools opportunities. This willcontinue to be a key priority in FY24 and beyond
to support the identification and realisation of
new as we see engineering and green skills
demand grow.

Group-wide

MediumLarge infrastructure projects which are subject toregional and national government approval, havevery long timeframes, from initial investment
through to final installation and ongoing
operation.

By understanding the timeline for these projects,
utilising external project data tools and mapping
clients’ requirements at each stage throughout
the timeline, we ensure we resource correctly ateach stage of the project.

Business segments potentially affected:

Likelihood:
Low

Potential impact and SThree’s response

8. Physical Risk

6. Transition Risk

Short

Measurement
indicators

Risk/opportunity

As global temperatures rise, our reliance on cooling will increase. It
is predicted that cooling requirements could triple by 2050 (Fossil
fuelled future scenario).

% reduction incarbon emissions% energy procured
from clean energy
sources

In FY23, we announced SBTi-verified net zerotargets which includes transitioning to 100%
clean energy by FY30. In addition, our officeselection criteria prioritise low-carbon offices
which includes offices with self-generatingenergy opportunities.
We continue to invest in carbon offsetting;however, our priority is decarbonisation. We
will continue to work with our partner Earthly
who provides verified offsetting solutions. We
currently offset scope 1, 2 and limited scope
3 emissions to ensure we support innovative
offsetting solutions whilst we transition to net
zero. The cost of offsetting was £47,684 in FY23.
More details on offsetting can be found on
page 71.

1. The increased operating costs to cool office spaces.
2.	Access to renewable energy as demand increases acrossall markets.
3.	The increased carbon offsetting costs to purchase carbon
credits whilst we transition to net zero.
4.	The reputational damage of increasing our carbon footprint
rather than limiting emissions/achieving carbon reduction
targets.
Business segments potentially affected:
Group-wide

Timeframe (term):
Short

MediumLong

Moderate

High

Likelihood:Low

9. Transition Opportunity

7. Physical Risk
Impact of extreme weather on operational
performance
Extreme weather events occasionally impact the markets inwhich SThree operates and can, at times, have an impact onaccess to offices and technology as well as access to sites forour contractors. The risk is that this could lead to a reduction in
productivity due to lack of access to offices or colleagues’ inability
to work due to power outages. In addition, our contractors may
have reduced access to sites to deliver their contracted hours.
The current risk is relatively small, and during the reporting period
we experienced no financial losses due to severe weather events.
Across our 33 locations only six locations have been identified as
at risk. Global warming could cause significantly more extreme
weather events in the longer term, increasing the number ofbusiness locations affected (Fossil fuelled future scenario).
Business segments potentially affected:
USA, Rest of Europe (the UK), DACH (Germany), and ME&A

Number of days’
work lost fromsevere weather
eventsAs part of the Group’s business continuity
planning, the offices identified as at risk haveplans in place to ensure operations can continue
if they are impacted by the weather. The
Covid-19 pandemic and the need to implement
remote working at pace tested the effectivenessof our business continuity planning. Where gaps
in the plans have been identified these are being
proactively addressed. Each country has incident
management teams to manage any severe
weather events ensuring disruption is minimised
while colleague safety is paramount.
Our office footprint is in mature markets whereplanning and building controls are robust which
supports the mitigation of this risk. In addition,
our office selection criteria consider physicalclimate risk. This will impact our long-term
decision making on future new markets andbusiness growth opportunities.

MarketResponding to the changing demands of the market
We are dynamic and flexible in our approach and can adapt to newmarket requirements with agility and pace.
Our flexible approach alongside offering full staffing complianceexpertise and at times additional ‘value-add’ offerings such astrucks, IT equipment and adjacencies for wind projects. Our
expertise and proven track record in delivering compliant staffing
solutions provide competitive advantage to clients and potential
clients who are sourcing STEM talent to deliver their low-carbon
transition plan.

Business segments potentially affected:% net fees
generated fromclean energy
sectorWe have a strategic review process which isoverseen by our ExCo. This process regularly
reviews our markets and new opportunities toensure we are investing in the right way.
We have a proven track record in pivoting ourconsultants to respond to changing market
opportunities. Most recently, we demonstrated
this through the changing market needs during
Covid-19.
Continuous market reviews ensure weunderstand large tenders coming to market, andcan map out recruitment requirements at eachstage, enabling us to build relationships withappropriate clients throughout the value chain.
Our Global Renewable Energy Network shares
best practice approaches to project mapping
and planning which helps our teams to maximise
opportunities.

Group-wide
Timeframe (term):
Short

MediumLong

Moderate

High

Likelihood:
Low

66

SThree plc

Timeframe (term):
Short

MediumLong

Moderate

High

Likelihood:
Low

Annual Report and Accounts 2023

67

Our commitment to being a responsible business (including TCFD) continued

Strategic Report
Governance
Financial Statements

Our key climate-related risks and opportunities continued
Measurement
indicators

Risk/opportunity

Potential impact and SThree’s response

Measurement
indicators

Risk/opportunity

Potential impact and SThree’s response

12. Transition Opportunity

10. Transition Opportunity
MarketGrowth of clean energy generation and associatedtechnologies% net fees
generated fromclean energy
sectorFor details on potential impact and SThree’s
response, see Transition opportunity 9 (Market/
Responding to the changing demands of themarket) on page 67.

Materially increased net fees from large infrastructure projects(e.g. offshore wind) and local changing energy generation mix, willlead to investment into technologies and available government
grants for clients, which will be invested into talent requirements todeliver projects.

Reputation

Maintain CDP
Score

Emergence of the ‘green recruiter’
Increasingly, clients are asking for SThree’s ESG targets andstrategy, as such there is an opportunity to stand out from ourcompetitors by highlighting SThree’s green credentials andcommitment to delivering both environmental and social impact.

% reduction incarbon emissions

For details on potential impact and SThree’s
response, see Transition opportunity 11(Reputation/Alignment to low-carbon clients) on
page 68.

In European markets there is an emergence of small, sustainable
recruitment agencies who solely work with low-carbon clients.
SThree has the potential to also compete in this niche market
and obtain competitive advantage given the climate leadership
position, experience and compliance benefits already in place.

Additionally, the growth of green innovation will create new STEM
job opportunities. LinkedIn research highlights growing demand
for green skills. In 2023 green skills demand increased by 12%
alone. Predictions from IRENA and other industry bodies highlight
unprecedented growth in green skills in the coming seven years.
SThree is well positioned to meet the growing demand for STEM
talent which will support our growth ambitions.

Business segments potentially affected:

Business segments potentially affected:

Group’s European markets

Group-wide
Timeframe (term):

Timeframe (term):
Short

Medium

Short

Long

Long

Moderate

High

Likelihood:

Likelihood:
Low

MediumModerate

Low

High

11. Transition Opportunity
Reputation

Maintain our CDP
Score

Alignment to low-carbon clientsAs the market moves towards a low-carbon future, companies
are reviewing their own transition plans. Increasingly they arequestioning the environmental impact of all suppliers. SThreehas been working on carbon footprint management and carbon
offsetting for over a decade. Our long-term environmental
strategy, targets and transparent reporting provides a competitive
advantage.
We experience an increased demand to clearly evidence ourclimate ambition and carbon reduction plans as a supply partner.
Given minimal differential economic incentives, candidates oftenchoose to work for a more socially conscious company – this could
extend to SThree itself as a recruiter who aligns themselves to a
low-carbon solution, providing opportunities to grow net fees.

% reduction incarbon emissions

We continue to be market leaders in ourenvironmental action with clear targets andmetrics. In the reporting period we announce
SBTi-verified targets and maintained our
CDP score.
Doubling the share of our clean energy businessby FY24, and intentionally growing our green
business highlights our alignment to a lowcarbon future whilst reducing the reputationalrisks of working with high emitting clients.
We continue to build our position as a thought
leader in regard to the green skills gaps
which is demonstrated through us co-hosting
programmes with clients, women in renewableindustries and sustainable energy as well as otherkey partners.
Through a strategic, embedded approach to ourrole in climate action we are not only positioning
ourselves, but we are driving outcomes aligned
to sustainable development.

Business segments potentially affected:
Group-wide

Timeframe (term):
Short

MediumLong

Moderate

High

Likelihood:
Low

68

SThree plc

Annual Report and Accounts 2023

69

Our commitment to being a responsible business (including TCFD) continued

Strategic Report
Governance
Financial Statements

Climate-related scenario analysis

Our transition to net zero

TCFD recommendation: Describe the potential impact of different scenarios, including a 2°C scenario, on theorganisation’s businesses, strategy and financial planning.
SThree has been utilising climate-related scenario analysis since
FY20. We assessed the financial implications of climate changerelated risks and opportunities under three scenarios alignedwith the NGFS climate scenario framework. The first scenario(‘Green revolution’) is prepared considering orderly transition led
by growth in renewables where an average global temperature
increases by 1.5°C or less; this scenario is most aligned with our
net zero commitment. The second scenario (‘Disruptive change’)considered disruptive climate change with an average global
temperature reaching 2°C. The third one (‘Fossil fuelled’) is a
scenario where global temperatures increase by more than 3°C.

We utilise these three scenarios to ensure all potential risks
and opportunities are identified, and that we are testing ourresilience under each scenario as political landscapes shift andthe likelihood of each scenario materialising shifts. Our net zerocommitment is aligned to a renewables-led scenario (global
warming limited to 1.5°C) which aligns to the Paris Agreement,
our commitment to doing the right thing and also to maximise
the opportunities we have identified within this scenario. Eachrisk and opportunity are analysed based on an estimatedimpact on net fees, aligned to our risk management framework.
Using net fees as a measure of impact allows for a consistentcomparison of risks and opportunities and their impact acrossdifferent scenarios.

SThree uses the NGFS climate scenario framework to stress test key climate-related risks and opportunities. The key outcomesfrom the climate-related scenario analysis inform SThree’s targets and growth opportunities, and wider business strategy, e.g.
how we grow our value proposition as a green recruitment partner to mitigate reputational risk and realise opportunities withboth clients and candidates as outlined above.

Green revolution(orderly 1.5°C)

Disruptive change(disorderly 2°C)

Fossil fuelled(hot house 3°C+)

This orderly scenario assumes that climate
policies are immediately implemented, with anincreasing carbon price levelled that ensures
the world does not exceed 1.5°C warming.

This disorderly scenario assumes thatsignificant climate policy is not implemented
until 2030. In order to reach the 2°C mitigation
goal, the transition from this point happens at a
far quicker pace than in the orderly transition.

This scenario incorporates the policies andmeasures that governments around the world
have already put in place and assumes that nofurther policy action will be taken. The scenario
assumes only cautious implementation ofcurrent commitments and plans. Emissions
grow until 2080 leading to 3°C+ of global
warming and increased physical risks.

The economy is strong, driven by new
industries providing green solutions andtechnologies such as AI, robotics and battery
technology. The development of circular
economy business models disrupts legacy
industries, removing incumbents. Global
opportunities expand in all markets as
consumer technologies are democratised.
Under this scenario, the energy sector
mix shifts rapidly, as the world transitions
away from fossil fuels and towards lowcarbon power, heat and mobility solutions.
Consumer concern over the environmental
sustainability of products and services ishigh, and candidates actively disassociatewith companies not following the renewable
revolution.

Engineering and finance sectors benefit fromthe rapid development of a carbon dioxide
removal industry – funding for which comesin the form of increased energy prices forbusinesses and consumers.
Under this scenario, the energy sector mix
does not change noticeably until after 2030,
at which point actions taken are relatively
late and limited by available technologies, toenable a sharp reduction in emissions. The
pace of change claims many victims within
high-carbon industries who are left withsignificant levels of stranded assets.

New technology solutions are not developed
quickly or cost-effectively enough to disrupt
legacy industries. Energy prices are kept
suppressed by the lack of any meaningfulcarbon price and the lack of progress in carbon
removal technologies.

70

SThree plc

Full details of our net zero targets can be found on page 72

Over 87% of our carbon emissions derive from scope 3, with our supply chain being the most significant element of our carbon
footprint. Due to the size of SThree and our relatively modest spend with multi-national tech and insurance companies decarbonising
our supply chain is a challenging priority which will take time. As a result, we have developed a transition roadmap which reflects
both near-term and long-term actions across our most material carbon emissions.

2024

2030

2050

Utilising our new property
criteria to open SThree’s first
net zero operating officein Glasgow.

Agreements in place with alllandlords to procure 100%
clean energy and utilise
self-generating technologies
where possible.

30% car fleet hybrid or electric.

100% car fleet clean fuelled.

By FY50, the megatrends
accelerating the demand for
STEM talent will be reflected in
how we operate. The speed ofchange, our STEM placements
facilitate, will build a future
where:

Scope 1 & 2 targets
100% clean energy

100% clean car fleet

At least seven offices will be
reviewed utilising our clean
property selection criteria.

All offices will be reviewed
utilising our clean energy
criteria.

Low-carbon travel

Introduce and embed a travel
platform that helps influence
behaviour change.

Reduce emissions from travelby 50% through low-carbon
travel options and remotecollaboration technology.

Colleague commuting and working from home

Commence an audit of green
commuter benefits to identify
new opportunities.

Office portfolio to reflectclean commuting with active
travel facilities and transport
connections. All offices will be
reviewed using our clean officeselection criteria.

Decarbonise our supply chain

Engage top 20 high emitting
suppliers in carbon reduction
targets.

Achieve 50% reduction in
supply chain emissions throughinfluencing strategic suppliers
and reducing consumption.

Clean office portfolio

Scope 3 targets

Significant disruption on sectors with offices,manufacturing sites located in regions andareas of high physical risk.

The financial impact assessments for the above presented scenarios are based on the same method of calculations as those used for principal risks evaluated under the SThreeGroup-wide risk framework.

Within all three scenarios we identified no climate changerelated risks that would have a material impact on SThree, ourperformance and strategy. This is consistent with the assertion
that risks associated with climate change are not expected tohave a material impact on the longer-term viability of the Group.

SThree has had climate science aligned targets since FY18 and this year we announced SBTi-verified near-term and long-term net
zero targets. We are committed to transitioning to a net zero business, aligned to a 1.5°C future in order to mitigate the risks andmaximise the opportunities outlined in this report.

However, some growth opportunities may arise from therole STEM skills play in decarbonisation (see details on thismegatrend on page 4) and our proposition as a green supplier(see further details on pages 18 to 19 related to our strategicpillars). It has resulted in SThree setting a target and strategy
to maximise this side of our business. In addition, the scenario
analysis continues to inform wider business strategy, e.g. how
we grow our value proposition as a green recruitment partner
to mitigate reputational risk and realise opportunities with bothclients and candidates as outlined above.

Commence the implementationof supply chain data
management within digitaltransformation.

• the energy sector will betransformed, utilising lowcarbon technology to power
our offices;• the travel sector will bedecarbonised and clean
vehicles will dominate how wetravel;• metaverse technology will
influence how people work,
come together and collaborate,
impacting offices, commuting
and travel; and• the world is changing andSThree is providing the STEM
talent that will create a net zeroworld for our business.

The transition to net zero will take time. Our commitment is to take action today, implementing carbon reduction activities andoffsetting our carbon emission. We have developed a multi-year partnership with Earthly, a non-profit focused on empowering
companies to invest in nature. Through our partnership we offset carbon by investing in nature-based solutions that combat climatechange whilst delivering social outcomes. Our approach to offsetting is focused on scope 1, 2 and limited scope 3 emissions. It is a
short-term mitigation strategy whilst we reduce our carbon emissions and move to net zero. More information on Earthly and the
project we fund can be found on page 8 of the ESG Impact Report 2023.

Annual Report and Accounts 2023

71

Our commitment to being a responsible business (including TCFD) continued

Strategic Report
Governance
Financial Statements

Metrics & Targets pillar
Metrics

Metrics

TCFD recommendation: Disclose the metrics and targets used by the organisation to assess climate-related risks
and opportunities in line with its strategy and risk management process.
In order to manage risks and opportunities the Group’s ESG
Committee have set metrics and targets which are reviewed
quarterly with any material changes escalated to ExCo forreview and further escalation to the Board.
As indicated in the table 2 below, certain metrics and targets aredisclosed at other most appropriate locations of the Strategic
Report.
Our overall climate commitment is to be net zero acrossabsolute scope 1, 2 and 3 emissions by FY50. As recommended
by the SBTi, we have set both near-term and long-term targets
which were verified by SBTi and align to a 1.5°C future. Our
targets are:

Long-term targets

SThree commits to reaching net zero GHG emissions across thevalue chain by FY50. Aligned to the SBTi net zero standard, thiscommitment is a long-term target to reduce absolute scope 1, 2,
and 3 GHG emissions by 90% by FY50 from a FY19 base year.

Climate-related opportunities
Description

Key initiatives and progress FY23

Net fees generated throughrenewable business

28% (FY22: 29%) YoY growth.

Reduce absolute scope 1 and 2 GHG emissions by 77% by
FY30 from a FY19 base year.

•

SThree commits to increasing annual sourcing to 100% ofelectricity from renewables by FY30 from 28% in FY19.

•

Reduce absolute scope 3 GHG emissions by 50% by FY30
from a FY19 base year.

In addition to climate reduction targets, in FY19 we set a target to double the size of our clean energy business by FY24 in responseto the opportunities identified through climate-related scenario analysis. In FY23, our clean energy business grew by 28% resulting in
SThree achieving this target.

142% (FY22: 88%) growth from FY19 baseline.

Double the size of our clean
energy business by FY24 (fromFY19 baseline).

Expanded the reach of our Global Renewable Energy Network toensure wider collaboration and sharing of best practice.

 or more information see
FStrategy overview, Our Placeson page 18

Introduced new client management tools as well as communication
channels to share relevant news and opportunities.

Near-term targets•

Targets

Evolved our tools to accelerate our response to client tenders anddue diligence queries.
	For more information see KPI section on page 20

Remuneration
Description

Key initiatives and progress FY23

Directors’ remuneration report
metrics – 10% weighting of LTIP
award performance measures(carbon emission reduction)

In FY23, we made progress towards our scope 3 target andunderstand more focus is required to achieve our scope 1 and 2 nearterm target.

ESG targets, including climate
targets, as outlined in the KPI
section of this Annual Report.

Table 2. TCFD recommended disclosures – metrics and associated targets
Metrics

Targets

Streamline Energy and Carbon Reporting(SECR) FY23

Climate-related risks (Transition risks)

72

Description

Key initiatives and progress FY23

% reduction in scope 1 andscope 2 carbon emissions

In FY23, our scope 1 and 2 emissions increased by 368% YoY, and
31% since our baseline year which was due to an increase in car
fleet emissions and in certain premises related emissions. This is
two-fold; business returning to pre-pandemic operating models
and an improvement in carbon data. We have however experienced
our premises emissions overall decrease by 61% since FY19.

Reduce absolute scope 1 and
2 GHG emissions by 77% by
FY30 from a FY19 base year.

% reduction in scope 3 carbon
emissions

In FY23, scope 3 emissions increased by 13% YoY but decreasedby 12% since our baseline year. We have remained committed toreducing emissions from our supply chain which equates to 69% of
our carbon emissions. Our supply chain emissions have decreased
by 5% since FY19.

Reduce absolute scope 3 GHG
emissions by 50% by FY30
from a FY19 base year.

% energy procured from clean
energy sources

The total energy consumption used to calculate emissions (kWh)reduced by 2% YoY and 79% since our baseline year.

SThree commits to increasing
annual sourcing to 100% ofelectricity from renewables by
FY30 from 28% in FY19.

CDP score

We continued to evolve our approach to climate risk managementin FY23, ensuring climate risks and opportunities inform strategy
as outlined in this report. In the prior year, our CDP score was B. At
the time of approval of this Annual Report, management was still
awaiting the release of FY23 score.

To maintain a B score in FY24.

SThree plc

Carbon reduction
SThree is committed to providing transparent carbon reportingto our stakeholders and to help facilitate this in FY23 we adopted
a new carbon data management platform. This provides us withstronger oversight and the ability to report more widely acrossscope 1, 2 and 3 emissions. We have therefore expanded thescope of our data and restated FY22 and FY19 (the baseline year
for our targets) to ensure our methodology is consistent.
In FY23, our scope 1 and 2 emissions equated to 3,072 tCO2e(market based) and scope 3 equated to 20,662 tCO2e, anaverage impact of 8.94 tCO2e per FTE. This represents a YoY
increase in carbon emissions of 26% and an intensity increaseof 48%. A contributing factor to the increase in emissions is theavailability of improved data accuracy and reporting, which
accelerated in FY23 with access to a new reporting system andbetter supplier data. The enhanced data collection provides amore precise view of our emissions profile, which has influenced
our scope 1 and 2 emissions. Another factor has been theongoing adjustments to work behaviours and practices in a post
covid environment. Through improved data and insights, wehave an even better understanding of the actions we must taketo achieve our net zero targets and this will be a priority in FY24
and beyond.

Energy efficiency initiatives

Although we have seen YoY increases, we have made progresssince our baseline year which is our closest to ‘business-as-usual’year pre-pandemic. The energy efficiency initiatives which havetaken place include:•

Our carbon emissions from premises (natural gas, purchased
electricity, waste and water) reduced by 61% since FY19
(baseline year). This followed the introduction of sustainableproperty criteria for new offices.

•

Although business travel has increased YoY due to anincrease of in-person meetings post pandemic, we have notincreased emissions to pre-pandemic levels and maintained
a carbon reduction of 10% since FY19, which is the result of
our sustainable travel policy.

Annual Report and Accounts 2023

73

Our commitment to being a responsible business (including TCFD) continued

Strategic Report
Governance
Financial Statements

Metrics & Targets pillar continued
Table 3. GHG emissions (tCO2e) and associated energy consumption (kWh) for FY23
(Energy and carbon disclosures for financial year, 1 December 2022–30 November 2023)
FY19
baseline Year

Emissions source (tCO2e)25

Scope 1

Scope 2

UK andoffshore

FY23

Global(excluding
UK andoffshore)

Global(excluding
UK andoffshore)

UK andoffshore% changein totalemissions% changein totalemissions(FY23 vs FY22)(FY23 vs FY19)

Natural gas

346

2

15

–

22

86

620%

-69%

Leased transport

42

990

11

87

–

2,455

2,405%

138%

Refrigerant

–

–

–

–

41

–

100%

100%

Purchased electricity(market/location based)

157

802

109/61

414/31994/53

320/215

-21%

-57%

Other fuels(heat and steam, EV)

–

9

1

21

–

54

145%

500%

Purchased goods
and services–

17,339–14,048704

15,74617%-5%

Capital goods

–

213

26

13

3

183

377%

-13%

T&D and WTT (fuel andenergy-related activities)

14

–

27

138

7

273

70%

1,900%

Upstream transportationand distribution

56

89

–

211

10

163

-18%

19%

Water (purchased goods
and services)

13

98

–

1

1

2

200%

-97%

Paper (purchased goods
and services)

–

4

2

–

4

4

400%

100%

Waste generated inoperations

15

33

1

5

1

3

-33%

-92%

Business travel

261

1,223

256

848

398

940

21%

-10%

Employee commuting
incl. working from home

–

3,637

417

1,570

382

1,166

-22%

-57%

Upstream leased assets(market/location based)

2

188

–

319/253

–

661

107%

248%

Downstream
leased assets

–

184

–

345

–

11

-97%

-94%

Total tonnes of CO2e(market based)

906

24,811865

18,0201,666

22,06826%-8%

Total tonnes of CO2e(location based)26

906

24,811817

17,8591,626

21,96327%-8%

Number of employees

860

2,504

756

2,364

655

1,998

–

–

Tonnes of CO2e per employee

1.05

9.91

1.14

7.62

2.54

11.05

48%

17%

11,789,326

170%

32%

Scope 3

Total energy consumption used to
calculate emissions (kWh)74

UK andoffshore

Global(excluding
UK andoffshore)

FY22

SThree plc

8,910,915

4,373,483

Methodology

Delivering training to strengthen ethical practices

In FY23, we introduced a new carbon data management
platform to continue to improve our disclosures. Prior to
calculating scope 3 emissions, a materiality assessment was
conducted to assess relevance using the GHG protocol. As aresult, categories 9-12 and 14-15 were considered to have nocontribution to the businesses’ scope 3 emissions and havetherefore been omitted from the SECR table published above.

These trainings include:

The method used to calculate GHG emissions is the GHG
Protocol Corporate Accounting and Reporting Standard(revised edition), together with the latest emission factors fromrecognised public sources including, but not limited to, BEIS, theUS Energy Information Administration, the US Environmental
Protection Agency and the Intergovernmental panel on
Climate Change.

As a result of changing platforms, we have recalculated historiccarbon data, aligned with emission factors now being used
and improved data awareness, which has resulted in somechanges in relation to previously reported emissions. In addition,
increased emissions across leased transportation in FY23
is the consequence of improved data collection from our car
fleet suppliers.
Following an operational control approach to defining ourorganisational boundary, our calculated GHG emissions frombusiness activities fall into the reporting period of 1 December
2022 to 30 November 2023, and using the reporting period
1 December 2021 to 30 November 2022 for comparison.

Governance targets

Integrating ESG impacts into the strategic and financial planningof the business continues to be a priority of the Board, including
providing transparent reporting on ESG matters. The Chief
Executive Officer has appointed the ExCo to direct Groupstrategy. To oversee the governance of risk management the
ExCo appointed a Group Risk Committee and to oversee thegovernance of ESG matters a Group ESG Committee. Bothcommittees include members of ExCo alongside subject matter
experts and other senior leaders from across the global business.
For full details on the Group governance structure see page 93
in this Annual Report.
To reflect shifting trends and stakeholder priorities, SThree
conducts an ongoing materiality assessment to ensure we
identify where we impact people, planet and society, and inturn how they impact our business. In FY23, we delivered 15
interviews, analysed engage survey data and conducted external
research across our stakeholder groups and markets to ensure
we continue to identify the most material ESG matters to ourbusiness.

In order to ensure ethical practices are embedded into ouroperations we are building a culture of ‘doing the right thing’
which is being integrated into every element of our employee life
cycle, from how we recruit people, to their onboarding, personal
development and performance management. In FY23, we
continued to deliver mandatory training for all colleagues in our
SThree Academy.
•Anti-bribery and corruption;•

Data Protection;•

Cyber Security;•

Health and Safety; and•Modern Slavery.

In addition, our award-winning onboarding programme,
Elements, includes training on conduct, operating principles,
performance management, as well as specific training related
to roles. Within our SThree Academy we also provide training
on fraud, our Speak Up policy, DE&I, wellbeing and our wider
policies which every colleague has access to.

Launching Speak Up

In FY23, we refreshed our Speak Up policy and delivered acampaign to explain what the policy was and how colleagues,
suppliers, contractors and clients can use the policy to raise
concerns. The policy and process are designed to create asafe space for concerns and complaints to be addressed in atrusting and transparent manner. Through communications,endorsements from ExCo members and testimonials fromcolleagues who have spoken up in their career, we are building aculture of trust, honesty and safety across our value chain.
Ethical staffing solutions is the foundation of our operating
model and can be demonstrated throughout our Annual Report.
Summary of our policies, implementation and monitoring details
can be viewed online by scanning the following QR code.

Legal notices and policies | SThree

See the summary of notices and policies on
SThree corporate website.
sthree-ar23-notices-and-policies.pdf

The FY23 materiality assessment reaffirmed the criticalmaterial matters with no new issues materialising. The mostcritical matters arising continue to be: climate change anddecarbonisation; DE&I, employee engagement and productivity;
diversity of our candidates; data and cyber security; HSE.
These alongside all other material topics are detailed in our
ESG Impact Report 2023.

Annual Report and Accounts 2023

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