InsightInnovation
ImpactOxford Instruments plc
Sustainability Report 2023

Oxford Instruments plc
Sustainability Report 2023

Overview

Our purpose-led approach

Purpose at the heart of oursustainable future
Leading with purpose is part of our corporate DNA, as
we help our customers to shape a more sustainable
future. Our purpose and values also underpin our
determination to embed sustainable principles
throughout our operations. We see sustainability
as combining good business and sound ethics.
Oxford Instruments has a longand strong track record asa driver of positive progress,
which goes right back to thefoundations of the company in1959 under the leadership of Sir
Martin and Lady Audrey Wood.
“Audrey and Martin shared adelight in combining ingenuity
with practical good sense, and1

a commitment to making things
better for people,” wrote one of
Sir Martin’s obituarists, in 2021.
Their values and purpose-driven
ethos – developed long before
those terms became common
parlance in the corporate world– have become part of the fabricof the company.

Sustainability Report

Environment

SocialGovernance“Our engaged and innovative workforce are playing a key role indriving and delivering against our sustainability ambitions, fromday-to-day decision making to long-term planning.”
Sir Nigel Sheinwald,
Non-Executive Director and Chair of the Sustainability Committee
11 September 2023

I am proud that Oxford
Instruments retains theinnovative and inclusive culture
they created, and that inpartnership with our customers
and suppliers, we continue toaccelerate global developments
through our products andservices. In all we do, we seek toenable a greener, healthier, moreconnected advanced society.
In our own operations, I am
delighted that this year we haveset our stretching new Groupwide target to reach net zeroby 2045, as well as targetinga better gender balance, andcontinuing to focus on building

the inclusive and diverse
company we want Oxford
Instruments to be.
As I learned when I joined
employees for a dedicatedsession on sustainability in
March 2023, there is widespread
support and commitment acrossthe company to progressing
our sustainability agenda,
from further reducing our CO2
emissions by reviewing ourenergy usage, designing our
products with sustainability
at the heart, andachieving greater ethnic
diversity across ourglobal operations.

You can read about our progressin 2022/23 throughout thisSustainability Report – and welook forward to forging ahead
together in 2023/24.

www.oxinst.com

Oxford Instruments plc
Sustainability Report 2023

Overview

Our purpose-led approach

Sustainability Report

Environment

SocialGovernance

WHAT’S IN THIS REPORT

Chief
Executive’s
introductionpg

05

Environment

Our purposeled approachpg

08SocialSustainability
reportpg

17

GovernanceContents
0verview
3

Highlights 2023

4

Our approach to sustainability

5

Chief Executive’s introduction

7

At a glance

Our purpose-led approach

Sustainability Report
17

Introduction

Environment
18

Introduction

19

Environment report

24

TCFD statement

8

Our purpose-led approach

9

Purpose in action

Social9	Driving green transition in
the battery market

36

Introduction

37

Social report11	Supporting fundamental
understanding of diseasemechanisms to accelerate
drug delivery
13	Compound semiconductors
powering an ever-moreconnected society

Governance42

Introduction

43

Governance report15	Enabling the quantum
revolution

pg

2

18

pg

36

pg

42

Read our full Report and Financial
Statements 2023 and view the rest of
our reporting suite on our website:www.oxinst.com

www.oxinst.com

Oxford Instruments plc
Sustainability Report 2023

Overview

Our purpose-led approach

Sustainability Report

Environment

SocialGovernance2023 HIGHLIGHTS

Committed todriving positive
outcomes for all
our stakeholders
We are determined to make Oxford Instruments
a force for good, treating people and theplanet’s resources with respect as we support
our customers and grow our company.

3

Sustainability highlights

23%

100%

11,815

reduction in tonnes of CO2
equivalent (tCO2e) emissions per£million of revenue vs 2021/22

renewable electricity
maintained across our UK
manufacturing activities, withthe applicable business units
representing approximately 83%
of Group revenue

training courses taken by
our employees

6.7%

78%

83%

reduction in absolute Scope 1
and 2 emissions to 1,285 tCO2e
vs 2022 figure of 1,378 tCO2e

positive employee
engagement scoreof employees feel everyone at
Oxford Instruments is treatedwith respect

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Oxford Instruments plc
Sustainability Report 2023

Overview

Our purpose-led approach

Sustainability Report

Environment

SocialGovernance

OUR APPROACH TO SUSTAINABILITY

Sustainability
is central to Oxford Instruments,
with our purpose, values,

strategy and chosen end markets

all aligning around thepositive

impact we seek to make on ourplanet and our stakeholders

Through our products and services, we are working
to enable a greener, healthier, more connectedadvanced society. And through our commitment
to operating responsibly, in line with our values,
we strive to be a good citizen of the planet.
We take a holistic approach to sustainability,
ensuring that it is embedded throughout theorganisation, from our Board-level Sustainability
Committee, on which all Board members sit, toour whole workforce around the world. We alsoseek to embed principles of sustainability in
our interactions with all stakeholders, including
customers, supply chain partners and our local
communities. In order to align with our ambition
to be a leading organisation in the area ofsustainability, and adhere to our principles,
we focus on the following areas: environment,social and governance (ESG).
Taking the right actions on sustainability at alllevels is critical for us to create the value andpositive impact we seek to achieve, and we arecommitted to building on past progress andcontinuing to challenge ourselves to go further.
We are currently focusing on six strategic
initiatives to effect change in our organisation– progress to net zero; environmental impact;
operating responsibly; sustainable productstewardship; inclusive culture; and communityand connection. These strategic initiatives areunderpinned by the ongoing foundations of

4

responsible business which guide our ways
of working: environmental progress; ethicalbusiness practices; regulatory and financial
compliance; health and safety; investing in
our people; and culture and engagement. We
set out our progress against our ESG strategy
throughout this section.
At a global level, the United Nations Sustainable
Development Goals provide an ambitious
and powerful framework for companies andother organisations to focus their efforts andcommitments. We fully support all 17 goals, buthave focused our efforts around those goals where
we feel most able to have a positive impact.

Our products contribute toward thefollowing goals:

The way we run our business and theactions we take throughout our value
chain support the following goals:

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Oxford Instruments plc
Sustainability Report 2023

Overview

Our purpose-led approach

Sustainability Report

Environment

SocialGovernance

CHIEF EXECUTIVE’S INTRODUCTION

A year of positive progress– and new ambitious targets
Sustainability has long been key to the way we operate. This year we have madeour commitment more tangible than ever, both through our positive actions andthe setting of stretching new environmental and social targets.
At Oxford Instruments we are committed
to being responsible corporate citizens,
furthering global progress through thedelivery of our purpose, and respecting
people and planet throughout
our operations.
We have successfully reduced ourcarbon footprint on an ongoing basis
since the early 2000s, with our carbon
intensity metric now almost ten times
lower, at 2.89 tCO2e per £million, thanthe 27.5 tCO2e per £million we recorded
in 2013/14. This year alone, we have

Ian Barkshire
Chief Executive

5

reduced our overall Scope 1 and 2
emissions by close to 7%. From a social
perspective, we have worked hardto create a diverse and supportive
environment which attracts talented,
passionate and creative people, and our
positive employee engagement scores
bear this out. We seek to operate to
the highest ethical standards with our
stakeholders, including our supply chain,and to make a positive impact on thecommunities in which we operate.
Operating sustainably matters to us.
And while we are proud of the business
we are today, we are determined toaccelerate the positive progress we havemade over many years. The creation in
2021 of our Board-level Sustainability

Committee demonstrates the level offocus we place on this area. In this, oursecond standalone Sustainability Report,
we highlight some of the impact of our
purpose-driven approach, set out ourapproach to sustainability through anenvironmental, social and governancelens, and share our progress in each area.
A particular area of focus in 2022/23
has been the development of our new,ambitious and evidence-based net zerotarget of 2045, together with interim
targets to 2030 for the reduction of our
Scope 1 and 2 emissions by 50% and 70%
respectively. We are particularly pleased
that our efforts to carry out a detailed
analysis enabled us to create targets
founded on a strong base of evidence.
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Oxford Instruments plc
Sustainability Report 2023

Overview

Our purpose-led approach

Sustainability Report

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CHIEF EXECUTIVE’S INTRODUCTION continued“We continue to
strive for equality,
diversity andinclusion, andthis year havelaunched new
employee impact
groups focused on
race and ethnicity,
LGBTQ+ issues
and, most recently,
neurodiversity.”6

Our next steps include working with
our supply chain to develop interim
targets for our Scope 3 emissions,which constitute the majority of ourenvironmental footprint, setting out thedetail of our net zero roadmap, andassessing the progress made towards ourgoals. Read more on in the Environment
section on pages 18 to 23, and in our
Taskforce for Climate-related Financial
Disclosures statement on pages 24 to 35.
We have also focused on developing
and extending the social and governanceelements of our sustainability agenda.
In particular, we continue to strive for
equality, diversity and inclusion, andthis year have launched new employee
impact groups focused on race andethnicity, LGBTQ+ issues and, mostrecently, neurodiversity. We havealso formalised our target of 40% of
leadership roles being held by women by
the end of 2025, as we continue todevelop a balanced and diverse.
leadership team. Keeping our people safe
and well is a further area of focus for us,
and I was pleased to note both that there
were no serious accidents during theyear, and that the number of safety
observations reported by employees has
increased, helping to inform the actions
needed to prevent accidents.

You can read more about our approach,
our commitments and our activities inrelation to all these areas in the socialand governance sections of this reporton pages 36 to 45.
A further key development this year
is the forthcoming introduction ofsustainability-focused remuneration
structures for Executive Directors, devised
through collaboration between the
Board’s Sustainability Committee andRemuneration Committee. Embedding
social and environmental considerations
into remuneration acts as a powerfuldemonstration to both internal andexternal stakeholders that we regard
these, alongside financial considerations,as crucial measures of Oxford
Instruments’ success.
But of course, our contribution tosustainability goes far beyond the way inwhich we operate our business – indeed
it is central to our purpose, to enable
a greener, healthier, more connectedadvanced society. We help our customers
to make a tangible positive impact
on the world in all these areas. Using
our products and services, customers
are developing new materials andapproaches to enable the critical energy
transition which will directly impact

everyone on the planet, as the world’s
governments and businesses pursue
the goal of reaching net zero carbon
emissions. In healthcare, our products
are enabling medical researchers
to understand the fundamental
mechanisms of disease, accelerating
their progress on new medicines andtreatments. We are also instrumental
in the drive towards a more connected
future, where everyone, everywhere
can access information whenever theyneed – with a particularly meaningful
impact in the emerging economies whereconnectivity has been proven to improve
lives and increase prosperity.
I am extremely proud of all mycolleagues, who keep our purpose frontand centre in their plans and actions, andwho embody our values in all they do.
As my own time at the helm comes to aclose, I have every confidence that Oxford
Instruments will continue to make thepositive contribution it has made to theworld since 1959.

Ian Barkshire
Chief Executive

11 September 2023

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Oxford Instruments plc
Sustainability Report 2023

Overview

Our purpose-led approach

Sustainability Report

Environment

SocialGovernance

AT A GLANCE

We are a global providerof high-technology 		
products and services
to the world’s leading		 companies andscientific research 		communities

What we do

Where we operate

Who we work with

Our business is structured around threesectors to support our customer-centric
approach and focus on applications.​

We sell products and services all over
the world, employing more than 2,000
people across 30 bases in 17 countries.

We work with thousands of companies
and academic institutions in six key
structural growth markets.

Total revenue

86£444.7m

Revenue split by sector

7

end markets

regions

Revenue by region

Materials &Characterisation£234.5m

Research &Discovery£139.4m

Service &Healthcare£70.8mRevenue by market

USA£121.2m

Healthcare & Life
Science£85.2mChina£107.4m

Japan£46.7mSemiconductor &Communications ​£122.0m

Germany£32.1mAdvanced Materials£140.2m

UK£29.4mEnergy & Environment ​£43.0mRest of Asia

£47.1mQuantum Technology​£35.3mRest of Europe£43.4m£19.0mRest of the world£17.4mResearch &Fundamental Science​www.oxinst.com

Oxford Instruments plc
Sustainability Report 2023

Overview

Our purpose-led approach

Sustainability Report

Environment

SocialGovernance

OUR PURPOSE-LED APPROACH

Insight and Innovation creating an Impact
pl
e
Pe
o

y
lit
bi
na

s

ie

lit

bi
ie
s

CustomerInnovation
and ProductDevelopment

ilit
y

pa

bi

lit

Operational
Excellence

ab

Ca

le

Innovative

ab

n

8

Inclusive

MarketIntimacyai

Delivery against our purpose and the Horizon strategy
is underpinned by our values and culture. ​For more information / Page 15

Our Horizon strategy
is underpinned by ouroperating framework,
which drives sustainablegrowth and margin
enhancement, while
generating value forour customers. ​Customer
Supportst

For more information / Page 11

Enabling
the quantum
revolution

As a customer-focused,market-driven business,
we put our customers at
the heart of all we do.

SuSupporting thedevelopment of
new drugs

For more information / Page 13

Su
st
ai

y
ilit
ab

pa

For more information / Page 9Powering anever-moreconnected society

Sustainability
surrounds our
Horizon strategy​op
Pe

To enable agreener, healthier,more connectedadvanced society.

Driving green
transition in thebattery market

for a sustainable futureCa

Our purpose

Our purpose-led approach enables us to contribute to a greener,
healthier, more connected advanced society. Using our market
insight we innovate to provide high-tech solutions for a betterworld today and in the future.​

Su
st
ai
n

Shaping a sustainable future anddelivering on our purpose

ilityTrusted

Su

st

ai

n

Purposefulwww.oxinst.com

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PURPOSE IN ACTION
To enable a greener, healthier,more connected advanced society

Driving green transitionin the battery market
With batteries playing a critical part in thegreen transition, in everything from cars tophones and electronic devices, our products
and solutions are supporting customers at
every stage of the battery life cycle.
Across a broad range of our microscopy portfolio
and at every point of the life of a battery, from theextraction of raw materials through the researchand development phase to manufacture andfailure analysis, customers in sectors ranging fromautomotive to high-end consumer technology areusing our instruments and techniques to produce
and develop safer, more sustainable batteries.

9

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PURPOSE IN ACTION continued
To enable a greener, healthier,more connected advanced society“We increasingly see
customers deploying
a wide range of our
products and techniques
to accelerate theirprogress in developing
safer, more sustainable
batteries.”
Ian Wilcock
Managing Director
Oxford Instruments Materials
Analysis Group

10

Insight

Innovation

ImpactTo deliver the transformational shift tomore sustainable power, academics
and companies the world over are
racing to develop and manufacture
higher-performing, faster-charging
batteries, at a lower cost and with alonger life, all while seeking to use
more environmentally friendly, moreabundant materials.

Across our portfolio, from compositional
analysis to Raman and atomic
force microscopy, we’ve developed
characterisation techniques andsolutions to help our customers
understand the fundamental chemistry
and properties that affect battery
capacity, charging rate and lifetime,
as well as quality control andfailure analysis.

As well as supporting today’s
manufacturing, our products areplaying a critical part in the creationof the next generation of batteries.
With our help, customers aremaking advances in both safety andsustainability: helping to reduce the riskof catastrophic fires and failures, while
accelerating the race to power our
future without harming our planet.

Helping to deliver our SDG goals

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PURPOSE IN ACTION continued
To enable a greener, healthier,more connected advanced society

Supporting fundamental
understanding of diseasemechanisms to accelerate
drug delivery
Our optical microscopy portfolio is ideally
positioned to support users, from advanced
super-resolution research systems toeasy-to-use accessible solutions andworld-class data analysis.
Using our equipment, scientists can analyse cells, organs andtissues down to the nanoscale, helping them understand thedefects within molecular and cellular processes which cause
disease, and test the impact of new treatments.

11

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approach

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PURPOSE IN ACTION continued
To enable a greener, healthier,more connected advanced society“With BC43 andDragonfly, weare deliveringtransformational
performance toaccelerate thedevelopment of
new treatments
and therapies.”
Kristian Laskey
Managing Director
Oxford Instruments
Andor Technology

12

Insight

Innovation

ImpactAs life science becomes ever-more
sophisticated and more ambitious,
our customers increasingly needflexible equipment to accelerate theirprogress, from simple, straightforwardbenchtop microscopy that can process
a multitude of samples at pace, to superhigh-end microscopes that can zoom in
to a single cell and watch its behaviour
in real time.

We’ve created products which enable
customers to zoom in, Google Earthstyle, to large-scale samples such as
whole organs, to see single molecules
within cells. Our award-winning BC43
benchtop microscope (pictured)delivers unprecedented speed, easeof use and throughput, while ourDragonfly suite of super-resolution
research systems provides flexibility
for the most advanced user.

Our ability to image and analyse
cells, organs and tissues down to thenanoscale, and to interpret the outputs
with our bespoke software for cancer,
cell and neuroscience applications, is
speeding up the development of newtreatments for cancer and malaria, as
well as neurological diseases such as
dementia and Parkinson’s.

Helping to deliver our SDG goals

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PURPOSE IN ACTION continued
To enable a greener, healthier,more connected advanced society

Compound semiconductors
powering an ever-moreconnected society
Our developments in gallium nitride and indium
phosphide processing are supporting a wealthof applications, from truly wireless device
charging, where devices can charge over theair, to hyper-scale data centres and augmented
reality, where real-world environments areenhanced by holographic technology.
Our solutions have a crucial role to play in facilitating the next
generation of data centres to enable the world’s transition froman estimated total data processing requirement of 40 zettabytes– that’s 40 trillion gigabytes – to an anticipated 300 zettabytes ayear demand over the next five years.

13

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PURPOSE IN ACTION continued
To enable a greener, healthier,more connected advanced society“It’s rewarding forour teams to beat the heart of thesemiconductor
developments
powering the higherperforming, greener
technologies of today
and tomorrow.”

Insight

Innovation

ImpactSurging global demand for increased
connectivity, with the associated vast
acceleration in data usage, is poweringa revolution in semiconductors. The
market is seeking faster, higherperforming, lower-energy chips
and microprocessors in its quest toaccelerate progress in technology
while at the same time building in
greater sustainability.

We create proprietary semiconductor
processes to support the
manufacturing of the high-technology
devices used today, as well as thedevelopment of next-generation
technology. This includes the criticaltransistor components needed tooperate devices more safely, at higher
voltage, while using less energy –facilitating increased 5G connectivity,
truly wireless charging, new forms of
LIDAR remote sensing, and energyefficient data centres.

The positive impacts of our innovation
range from connecting the world
through 5G and enabling the next
generation of LED devices foraugmented reality with gallium
nitride semiconductors, to supporting
wearable sensors, faster data flows todata centres, and optoelectronics withindium phosphide conductors – andall while reducing the environmental
footprint of key applications.

Helping to deliver our SDG goals

Matt Kelly
Managing Director
Oxford Instruments
Plasma Technology

14

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PURPOSE IN ACTION continued
To enable a greener, healthier,more connected advanced society

Enabling thequantum revolution
One of the most disruptive technologies
emerging today, quantum computing is at apivotal point between the research lab andmigration into practical applications.
Innovating across a multitude of fundamental quantumenabling technologies, from cryogenics to advanced
fabrication, scientific cameras and characterisation, at
Oxford Instruments we have a key role to play in supporting
qubit scale up, quantum uptime and the commercialisationof quantum as it transitions to the mainstream.

15

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PURPOSE IN ACTION continued
To enable a greener, healthier,more connected advanced society“As quantum
applications develop,
we are seeing
increased academic
and commercial
opportunities forour technologies.”

Insight

Innovation

ImpactAs governments and companies
the world over seek to unleash thepotential of quantum, we are uniquely
positioned to accelerate the shift frompure science to practical applications
as we collaborate with partners toenable reliable high performance anduptime in quantum computers.

In 2021 we became home to the
UK’s first commercial quantum
computer at our headquarters in
Oxford, in partnership with Rigetti.
Our latest partnership, with Oxford
Quantum Circuits (OQC) and Equinix,
is accelerating quantum’s commercial
viability still further, as we provide
the cryogenics and 24/7 service
capability which have enabled the firstcommercial quantum computer in a
Japanese data centre.

With their ability to solve complex
problems beyond the capabilities
of classical computers, quantum
computers are already used inapplications from chemistry to logistics
and finance – but the future impactof quantum is expected to be evenmore significant, with the potential
to help tackle climate change andtransform our ability to develop
revolutionary medicines.

Matt Martin
Managing Director
Oxford Instruments NanoScience
Helping to deliver our SDG goals

16

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SUSTAINABILITY

Sustainability
is central to

Oxford Instruments’ strategy
Environment
For more information/ Pages 18–35

In order to align with our ambition
to be a leading organisation in
the area of sustainability, and toadhere to our principles, we focus
on the following areas:

We are committed to limiting our impact
on the environment throughout our own
operations and value chain, as well as
responding to the risks and opportunities
arising from climate change. Building on
the positive progress we have made todate, this year we have set an ambitious
2045 net zero target.

SocialFor more information/ Pages 36–41

Through our purpose and values-driven
approach we are working hard to build
a progressive and inclusive culture
where all our people can thrive and build
fulfilling careers. We also seek to havea positive impact on the communities
where we operate, today and in thegenerations to come.

Governance
For more information/ Pages 42–45

We hold ourselves to high ethicalstandards, operating our business
responsibly with a governanceframework shaped around eight
key areas. Our strong values guide
everything we do, from how we workwith each other and how we support
our customers, to how we tradewith suppliers.

Over the following pages we set out our approach to sustainability and the progress we have made during the year.

17

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SUSTAINABILITY: ENVIRONMENT

proudof the positive impact

Whilst we are

our products make in the world,
including their key role in supporting
technology pathways to decarbonisation,committed

we areto continuing to minimise our own

environmental footprint

18

Strategy and targets
With our intention to enable a greener
society enshrined in our purpose, wehave proactively reduced our own
environmental footprint over many years.
We embarked on our environmental
journey in the early 2000s, with thecreation of our employee-led Go Greenteams; since then, we have dramaticallyreduced our carbon footprint, leaving
only a relatively small footprint in ourown operations. Today, our carbon
intensity metric for Scopes 1 and 2
stands at 2.89 tonnes per £million
revenue – a reduction of 66% versus
the 8.5 tonnes per £million intensity
ratio for 2019, our baseline year.

23%

reduction in tCO2e per £million
revenue versus 2021/22

6.7%

reduction in tCO2e emissions
versus 2021/22

0.62

tCO2e per full-time employee(FTE) versus 0.76 tCO2e per FTE
in 2021/22

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SUSTAINABILITY: ENVIRONMENT continued
This year, supported by an in-depth
analysis of the components of ouremissions footprint, we have taken thesignificant step of setting new, more
ambitious but achievable net zero carbon
targets for Oxford Instruments. We are
now committed to reaching net zero by2045 in our own operations (Scopes 1
and 2) and across our supply chain andthe use of our products (Scope 3). We willcontinue to review this ambition and theopportunities that arise as technology
becomes more advanced, bringing thisdate forward if we possibly can. This
stretching goal puts us five years aheadof the UK Government’s commitment.
As part of our journey to net zero, weare setting challenging medium-termtargets of a 50% reduction in Scope 1
emissions and a 70% reduction in Scope
2 emissions, both calculated versus our
2018/19 baseline year, and set to beachieved by 2030. We have set thesetargets in alignment with the Science
Based Targets initiative (SBTi)’s ‘well
below 2°C’ framework, pursuing the‘higher’ ambition pathway, rather thanthe less challenging ‘required’ pathway.
We will now formally submit themto SBTi for verification, approval andofficial publication.

19

We will report on a market basis(reflecting the specific energy sources weuse) where we can, and a location basis(reflecting the average emissions intensityof the grid) where this is not feasible.
The approach that we have taken insetting our targets combines ambition
with a foundation rooted in an accepted
process, and real-world data. As
a company founded on scientificendeavour, we believe in the power ofinnovation to overcome the challenges
faced by our supply chain, the sourceof most of our Scope 3 emissions. We
are actively engaging with our suppliersand customers to seek to understandtheir routes to net zero (see case study
right), and to work with our externalsustainability advisers to consider
the likely ‘greening’ timetable of key
components. We will use what we learn to
set an ambitious but achievable mediumterm Scope 3 target in the coming year.
Through this process we have also
incorporated sustainability considerations
into our new product development stagegate process, to ensure the ongoing
reduction of the carbon footprint of our
products through energy use, packaging
and distribution, as well as increased
recyclability and upgradability.

CASE STUDYEngaging with
our supply chain
As with most manufacturing businesses, Scope 3
emissions (those derived from the products andservices we purchase, and the use of our products byour customers) constitute the majority of our carbon
footprint (98% of the total in 2021/22, when our mostrecent full Scope 3 assessment was undertaken).
Working with our suppliers is therefore critical in orderto understand, and then make an active plan to reduce,
our Scope 3 emissions. In October 2022, our Chief
Executive wrote to the suppliers who represent 80%
of our Scope 3 footprint, to open a dialogue about ourshared paths to net zero. The ongoing dialogue andinformation being provided is allowing us to better
understand the maturity of environmental commitments
across our supply base, and to build a detailed impact
map of what we buy, as well as to learn from those who
are further advanced on their journey than we are. We
are also using this as an opportunity to share insights
with and support SMEs who may have less experiencein measuring and monitoring their emissions.

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Environment

SocialGovernance

SUSTAINABILITY: ENVIRONMENT continued
Our roadmap to net zero
We have already made significant strides
towards more sustainable operations
over several years, leaving us with arelatively small remaining footprint in
Scopes 1 and 2. In the coming year, we
will further develop and prioritise ourroadmap to net zero. The steps we willtake between now and 2045 include:• ensuring that all of our sales, service
and manufacturing operations,wherever possible, are powered by
REGO-certified or REGO-equivalentcertifications of renewable electricity,
looking to move from current sites asleases come up for renewal where thisis not achievable;• seeking environmentally friendly sites
when we are looking for new sales,
services or manufacturing facilities;• looking for opportunities to reduceenergy usage at each of our sites;• replacing gas and oil boilers as suitablelong-term alternative technologies
become available; and• switching fleet vehicles toelectric rather than internal
combustion engines.

20

Despite the reduction of our Scope 3
emissions being more challenging, as
set out on page 19, we are proactively
engaging with our supply chain, andas our approach matures, suppliers’
approaches to decarbonisation will
form a key part of our future purchasing
decisions. We have also engaged
an external sustainability adviser tohelp us build a data-led roadmap of
the likely timeline scenarios for the
reduction of the main contributing
materials and components within our
Scope 3 emissions.

Our progress
Our footprint across our operations has
reduced by 6.7% year-on-year in absoluteterms, and by 23% year-on-year in termsof our carbon intensity metric (tCO2e per£million revenue). This indicates that
our emissions are moving in the right
direction – and, crucially, that although
our business is growing, our emissions arenot. Part of the reduction we have beenable to demonstrate this year stems fromour growing understanding of our global
operations with a wide variety of leases
and associated power arrangements.
We continue to purchase REGO-certified
renewable electricity for our four primary
manufacturing sites in Oxford, Belfast,

Bristol and High Wycombe, and arecommitted to doing so on an ongoingbasis. This represents the manufacturing
for 83% of our annual revenue.
EnergysourceElectricity

Usage2022/23

Usage
2021/22

11.58 GWh

10.01 GWh

Gas

1.62 GWh

2.43 GWh

Oil

0.59 GWh

0.53 GWh

Purchased district
heating and steam

0.22 GWh

0.22 GWh

Propane0.006 GWh 0.007 GWh

Owned vehicles

0.38 GWh

0.35 GWh

Total

14.41 GWh

14.91 GWh

When selecting new sites for ouroperations, we are committed tochoosing facilities which are poweredby renewable energy wherever possible.
This year we have made the decision to
consolidate our two Tokyo sites and are
set to move to a new, highly sustainablebuilding in summer 2023. With solar
power, water-conservation and energysaving measures, as well as having
been constructed in part from recycledmaterials, the new site is a 4-star certified
DBJ (Development Bank of Japan) green
building. We also have an ongoingprogramme to improve energy efficiency
at existing sites.

Actions taken during the year haveincluded continuing to replace
fluorescent lighting with LED lighting,
optimising heating, ventilation
and air-conditioning systems andrebalancing some electrical systems
to improve efficiency.
Building on the continued strong
engagement of our employees withenvironmental issues, we have continued
to empower our Go Green teams acrossour sites to help us further embedsustainability initiatives throughout theGroup. The support of our employees,
combined with our focused efforts, hasenabled us to make excellent progressin continuing to understand and manage
our CO2 emissions, and to educate eachother, while continuing to reduce theamount of waste products generated at
our manufacturing sites and facilities.

Streamlined Energy and Carbon
Reporting (SECR)
We have a statutory duty to reportgreenhouse gas emissions as tonnes ofcarbon dioxide equivalent (tCO2e). Ourchosen carbon intensity measure ofenergy use is tCO2e per £million revenue),since this metric is best suited to acompany like ours which is growing bothorganically and by acquisition. We reportin line with the requirements of SECR,
as set out in the UK Companies Act 2006
(Strategic Report and Directors Report)
Regulations; our full SECR report can befound on our website www.oxinst.com andour abbreviated reporting is on page 22.

For more information on our progress,
please see our TCFD statement progressroadmap on page 24.

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SUSTAINABILITY: ENVIRONMENT continued
CASE STUDY

A new facility for
Plasma Technology

Part of our commitment to sustainability includes
taking positive action to minimise the environmental
footprint of any new facilities and offices we take on.
Our new £70 million purpose-built semiconductor
fabrication facility at Severn Beach, near Bristol, UK,
which is set to open by the end of the current financial
year, is a good example of this approach.
This larger, state-of-the-art manufacturing facility
includes increased clean room space, which
requires high power density, and would typicallybe environmentally controlled by gas boilers – andindeed the first plans for the site included gas
boilers as standard. We successfully challenged thesite’s developers to source an all-electric heating
solution, which will be powered by renewable energy.
The building has been designed to meet the ‘Very
good’ specification through BREEAM, the leading
certification system for sustainable buildings. Eightelectric vehicle charging points have been installed,with capacity to expand as adoption grows, anda solar array provides part of the site’s power
requirements. We are also exploring the potential
for wind energy on site.

21

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SUSTAINABILITY: ENVIRONMENT continued
Our total carbon footprint for April 2022 to March 2023 is as follows:

Scope 1, Scope 2 and relevant Scope 3 greenhouse gas emissions (GHG)

Activity

Emissions(tCO₂e)% of total

Natural gas

296.6

23.0%

Gas oil

162.8

12.7%

-10%

Propane

1.3

0.1%

-6.7%

2021/222022/23Type of emissions

Type of emissions

tCO2e% of total

tCO2e% of total% difference inemissions

Direct (Scope 1)

603.4

47.0%

560.6

40.7%

+8%

Indirect (Scope 2) (market-based)

681.5

53.0%

817.0

59.3%

-17%

Indirect (Scope 2) (location-based)

2,511.9

Scope 1 and 2 (market-based) total

1,285.0

Total gross emissions (tCO2e) (market-based)

1,285.0

1,377.6-6.7%

Owned vehicles
PetrolDiesel

52.1

4.1%

42.1

3.3%

2.89

3.75

-23%

Refrigerant

48.5

3.8%

Subtotal

603.4

47.0%

14,409,374

14,317,185+0.6%

Purchased nonrenewable electricity

673.6

52.4%

Purchased renewableelectricity

0.0

0.0%

Purchased district
heating and steam

8.0

0.6%

Subtotal

681.6

53.0%

Intensity ratio (market-based): Scope 1 & 2 tCO2e
per GBP £m turnover

2,803.5
100.0%

1,377.6

100.0%

Direct (Scope 1)

Energy consumption used to calculate
Scope 1 and 2 emissions kWhIndirect energy (Scope 2)

Total emissions (tCO2e)
Energy consumption used to calculate emissions (kWh)Intensity ratio: Tonnes of gross CO2e per million GBP turnover

22

1,285.0
14,409,374
2.89

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SUSTAINABILITY: ENVIRONMENT continued
Business travel

Environmental directives

Water and waste

As part of our commitment to reduce our environmental footprint, we are continuing
to map and better understand our Scope 3 indirect emissions across the Group. These
include business travel, where we are increasingly able to source granular data on
distances travelled. Our strategy is to minimise the amount of travel undertaken, inparticular by finding new ways to connect with customers (with customer service andsales currently our biggest sources of travel emissions), including increasing digital andremote service and expanding regional teams to bring them closer to our customers(see pages 50–51). We will continue to progress both the extent of our reporting and,most important, to take the tangible steps needed to reduce our footprint.

As a Group, we are committed
to ensuring compliance with allenvironmental legislation in the countries
where we operate. This includes
European directives such as:

While we measure our water usage,
the level is minimal and not material,
so has been excluded from this report.
We have also excluded our use ofhydrofluorocarbons. Our four primary
manufacturing sites in the UK, generating
83% of Group revenue, are sending zerowaste to landfill; our waste is recycled
either directly or indirectly, for example
general waste is used to generate
electricity at dedicated incinerator sites.

We have identified that our teams in the UK, USA, China and Japan undertook around16.8 million km of air travel in FY2022/23, with the air travel carbon equivalent to2,704.4 tCO2e. This significant rise versus the prior year (2022: 6.0 million km), primarilyreflects our deepening understanding of the amount of travel undertaken, but has also
been impacted by the opening up of international travel routes as Covid-19 lockdown
restrictions eased, particularly in Asia (a key market for the Group). When consideredagainst an intensity metric (km travelled per £m of Group revenue), the number ofkilometres travelled is trending around 16% below pre-Covid-19 levels (2019/20:
44,934km per £m revenue; 2022/23: 37,756km per £m revenue).
Air travel 2022/23=

16,790,212 km (2021/22: 5,980,961 km)

Carbon equivalent=

2,704.4 tCO2e (2021/22: 947.5 tCO2e)23• Waste Electronic and Electrical
Equipment (WEEE) Directive –compliance achieved in the UK bymembership of B2B Compliance – anauthorised compliance body. Other
compliance bodies are contracted for
our European operations;• Restriction on the use of Hazardous
Substances (RoHS) regulations;• Registration, Evaluation, Authorisationof Chemicals (REACH) Directive;• European Waste Framework Directive.
This requires the company to enter
data on parts and products that may
contain Substances of Very High
Concern (SVHC) into a database being
set up by the European Chemical
Agency (ECHA). This is known as the
SCIP database and businesses are
currently engaged in determining whatshould be entered into the database toensure compliance.

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SUSTAINABILITY: TCFD STATEMENT

Task Force on Climate-Related Financial Disclosures (TCFD)
Statement for the year ended 31 March 2023
Introduction
Mitigating, adapting and responding to theimpacts of climate change is central to ourstrategy, both in terms of how we operate ourbusiness, and in terms of the positive contribution
we make towards a greener world through our
products and services.
We have made it a core priority over many
years to reduce the environmental impact of ouroperations. By 2018/19, our baseline year for
carbon target measurement, we had already
reduced our carbon intensity ratio (the mostconsistent metric in a growing company likeours) by nearly 70%, from 27.5 tCO2e per £million
revenue in 2013/14, our first year of reporting, to
8.5 tCO2e per £million revenue. This was achieved
through transformations within our business,
including energy efficiency programmes andinvestments such as switching to LED lighting.
This year’s report shows that our strong progresscontinues, with our carbon intensity ratio now at
2.89 tCO2e per £million revenue – a 66% reduction
since 2018/19. A further area of focus and action
has been the reduction of waste sent to landfill
from our manufacturing processes and facilities(see table below), with all four UK manufacturing
sites now classified as sending zero waste
to landfill.

24

We are committed to maintaining our progress,
and this year have set ambitious decarbonisation
targets, as set out below. We have also continued
to focus on working with our supply chain to
reduce our extended carbon footprint, and on
developing our understanding of the climaterelated risks we face and the opportunities
arising from the changing climate. Crucially, ourcommitment to sustainability, while led by the
Board, is embedded throughout our organisation,and is central to our purpose: to enable a greener,
healthier, more connected advanced society.

Progress roadmap
A snapshot of our journey so far, our progress
during the latest financial year and our action
plan for the year ahead, are summarised in thetable below. Our environmental reporting on
pages 18 to 23 of this report sets out our progressin further detail.

Prior to FY22/23

Progress during FY22/23

Focus for FY23/24• Established a ‘Go Green’
committee at each key
manufacturing site to deliver a
local environment agenda andpromote positive behaviours.

• Worked with the Board and Sustainability
Committee to develop our abatement
strategy and to consider the offsetting
options for residual emissions.

• Submit interim and long-term
carbon reduction targets forvalidation through the Science
Based Targets initiative (SBTi).

• Set new, ambitious targets to reach net zerocarbon emissions by 2045.

• Complete full Scope 3 emissions
assessment and continue
engagement with key suppliers.

• Invested in sustainableinfrastructure and renewable
technology, including theenergy-efficient design of our
new Plasma Technology facility.
• Converted three manufacturing
sites to achieve zero waste tolandfill, with the business units
on these sites representing
approximately 60% of Grouprevenue in FY22/23.
• Confirmed our aspiration toreach net zero carbon emissions
ahead of 2050.

• Set interim targets for our remaining Scope
1 and 2 emissions (a 50% reduction in Scope
1 and a 70% reduction in Scope 2 by 2030
versus 2018/19 baseline).
• Maintained 100% renewable electricity
across our UK manufacturing activities, withthe applicable business units representing
approximately 83% of Group revenue
in FY21/22.
• Reduced our CO2 emissions by 55% from2,844 tCO2e to 1,285 tCO2e, between FY18/19
and FY22/23.

• Produced our first report alignedwith the recommendationsof the Task Force on ClimateRelated Financial Disclosures(TCFD) in June 2022.

• Further reduced the volume of waste tolandfill by adopting a zero waste to landfill
approach at our Belfast manufacturing site,
ensuring that four sites representing 83% ofGroup revenue in FY22/23 send no waste
to landfill.

• Sourced certified renewableelectricity for all of our UK
manufacturing sites.

• Reviewed our position with the Science
Based Targets initiative (SBTi) and agreed
to work through SBTi process.

• Set out our roadmap to net zerofor Scope 1, 2 and 3 emissions.
• Progress contracting of
renewable electricity acrossour non-UK sites.
• Assess which are the most
relevant climate impact
reporting frameworks for
Oxford Instruments and adopt
as appropriate.
• Continue to build on
our quantitative climate
scenario analysis as partof TCFD alignment.
• Extend our rollout of
Go Green teams to
non-manufacturing sites.

• Completed full Scope 1 and 2 emissions
assessment and calculation for the latest
financial year and for 2018/19 baseline
year; completed baseline assessment for
Scope 3 emissions.

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SUSTAINABILITY: TCFD STATEMENT continued
Compliance Statement
As we are a premium listed company, we have reported on a ‘comply-or-explain’ basis against the
TCFD framework. This Report and Financial Statements contains our full TCFD disclosures. A copy
can also be found in the sustainability section of our website: oxinst.com/sustainability.
In line with the requirements of the Financial Conduct Authority’s Listing Rule 9.8.6(8)R, we note thatwhile our disclosures in respect of the financial year ended 31 March 2023 are full and transparent andcover all the areas required by TCFD, there are some areas where we need to make further progress inorder to meet its recommendations and recommended disclosures in full. The below table summarises
our consistency per the disclosures made in this report, together with cross-references to the various
sections of our Report and Financial Statements where additional relevant information can be found.
In determining whether our climate-related financial disclosures were consistent with the TCFD
recommendations and recommended disclosures, we undertook a detailed assessment of those
disclosures, supported by external advisers, which considered the applicable guidance referenced
under Listing Rules 9.8.6B to G.
TCFD pillar

Recommended disclosure

Governance: Disclose theorganisation’s governancearound climate-relatedrisks and opportunities.

a. Describe the Board’s oversight of climate-relatedrisks and opportunities.

Pages 26–27

b. Describe management’s role in assessing andmanaging climate-related risks and opportunities.

Pages 26–27, 34

Strategy: Disclose theactual and potential
impacts of climate-relatedrisks and opportunities
on the organisation’s
businesses, strategy,
and financial planningwhere such information
is material.

a. Describe the climate-related risks andopportunities the organisation has identified overthe short, medium, and long term.

Pages 28–33 of thisreport, and page 101 of
the Report and Financial
Statements 2023

b. Describe the impact of climate-related risks andopportunities on the organisation’s businesses,
strategy, and financial planning.1

Page 34 of this report,
and page 101 of theReport and Financial
Statements 2023

c. Describe the resilience of the organisation’s
strategy, taking into consideration different
climate-related scenarios, including a 2°C or
lower scenario.2

Page 28

25

Consistency Disclosure location

TCFD pillar

Recommended disclosure

Risk management:
Disclose how theorganisation identifies,
assesses, and manages
climate-related risks.

a. Describe the organisation’s processes for
identifying and assessing climate-related risks.

Pages 34–35

b. Describe the organisation’s processes for
managing climate related risks.

Page 34c. Describe how processes for identifying, assessing,and managing climate-related risks are integrated
into the organisation’s overall risk management.

Page 34 of this report,
and page 94 of theReport and Financial
Statements 2023

a. Disclose the metrics used by the organisation toassess climate-related risks and opportunities
in line with its strategy and risk management
process.3

Page 35b. Disclose Scope 1, Scope 2, and, if appropriate,
Scope 3 greenhouse gas (GHG) emissions, and therelated risks.

Page 22c. Describe the targets used by the organisation to
manage climate-related risks and opportunities
and performance against targets.

Page 35

Metrics and targets:
Disclose the metrics andtargets used to assess
and manage relevant
climate-related risks andopportunities where suchinformation is material.

Consistency Disclosure location

Indicates internal assessment of full consistency with recommended disclosures.
Indicates internal assessment of partial consistency with recommended disclosures. We are fully committed to achieving fullconsistency with the recommended disclosures and will continue to work towards this over the coming year. The gaps wehave identified in our disclosures are set out below.
1. The impacts of climate-related risks and opportunities are not yet fully integrated across the required areas; we will seek to do this as ourunderstanding deepens.
2. We have not yet carried out a complete climate assessment against a full range of scenarios. See page 28 for further details.
3. The metrics we have used do not yet extend to the full range of risks and opportunities arising. Please see page 35 for further details.

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SUSTAINABILITY: TCFD STATEMENT continued
GovernanceTo successfully evaluate and respond to the challenges and opportunities posed by climate change,
we recognise the importance of embedding knowledge of climate change issues across the business,
supported by effective governance. Our governance around climate-related risks and opportunities is
set out below.
The Board has ultimate responsibility for the oversight of climate change-related issues and is supported by
its Committees (primarily the Sustainability Committee, the Audit and Risk Committee and the Remuneration
Committee), the Management Board, the Sustainability Leadership Forum, set up in 2022, and the wider
senior leadership team. However, climate change-related considerations are embedded throughout ourgovernance structure, and at every level across the organisation, as set out in the graphic and explainedin more detail below.

The Board’s Sustainability Committee, comprising all the Non-Executive Directors (see the Sustainability
Committee’s Report on pages 141 to 143 of the Report and Financial Statements 2023), holds a broad remit
including accountability for assessing and reporting to the Board on progress against the environmental
strategy, targets and metrics, and meets at least three times a year. The Audit and Risk Committee provides
oversight and governance in relation to climate change-related risks and opportunities, which are managed
operationally by the Management Board and Sustainability Leadership Forum, while the Remuneration
Committee is responsible for setting and overseeing climate change-related remuneration incentives,
together with any other sustainability-related incentives.
The Sustainability Committee in turn provides strategic guidance and oversight to the management-level
Sustainability Leadership Forum (SLF), which is chaired by the Chief Executive. Representatives of the
SLF attend Sustainability Committee, and a positive two-way dialogue between the two bodies fosters
exchanges of information and insights. The SLF, set up in 2022, meets at least quarterly, and is primarily
responsible for detailed development of strategy, together with the assessment, management and tacticaldelivery of the environmental remit.

Climate-related governance framework
Oxford Instruments plc Board

Audit and Risk
Committee

The Board provides overall strategy and direction on climate-related risks and opportunities, andenvironmental strategy, including overseeing progress to net zero targets, and assesses how theseare being managed.

Board Sustainability
Committee

Remuneration
Committee

Sustainability Leadership Forum
Management
Board

Business unit andregional leaders

Managementof climate
risks andopportunities

Energyuse andreportingTarget setting
and progress
towards net
zero

Product
designSupplychain

Waste
management

Communications
and engagement

Go Green teams

Note to graphic: Arrows indicate two-way transfers of information and guidance between forums.

26

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SUSTAINABILITY: TCFD STATEMENT continued
Climate-related governanceframework continued
Its membership includes functional heads
and subject matter experts, who leadworkstreams on:• the management of climate risks
and opportunities;• energy use and reporting;• development of target setting andprogress towards net zero;• product design;• supply chain;• waste management and recycling; and• communications and engagement.
Committee members also lead liaison
with an external consultant on climate,energy and progress to net zero.
A key part of the SLF’s remit, working
in collaboration with the Management
Board, is to foster two-way engagementwith business units, regional leadershipand Go Green teams to drive andaccelerate Oxford Instruments’ progress
towards net zero and our managementof climate risks and opportunities.

27

Progress in the year
The Directors have considered climaterelated matters throughout the year,with such matters forming part of the
discussions in a range of areas including
the company’s strategy. The primary
focus for the Board and Sustainability
Committee in relation to climate during
the year has been to obtain a detailed
understanding of the actions required todecarbonise our operations and mitigate
the impact of climate risk. The Committee
has used this information to set ambitious
but achievable decarbonisation targets,
while developing its understanding of
the Science Based Targets initiative(SBTi) and exploring our potential targets
with reference to this framework. This is
in line with the duties delegated to the
Sustainability Committee by the Board,
through its formal terms of reference. It is
anticipated that progress against thesegoals will be considered as appropriate
at Sustainability Committee meetings
going forward.

During the year, the Sustainability
Committee has held dedicated sessions
with the Chief Executive, Management
Board and external consultants. Outside
formal meetings, the Chair of the
Sustainability Committee and Chief
Executive worked directly with various
members of the wider management
team and external consultants andreported back to the Board regarding
the insights gained into recommended
actions and targets.
As set out on pages 18 to 20, thisprocess has culminated in setting our
2045 ambition to reach net zero for
Scope 1, 2 and 3 emissions, as well as
medium-term targets for Scopes 1 and
2. With the sponsorship and support of
the Chief Executive, a working groupof the Sustainability Leadership Forumhas initiated detailed engagement with
supply chain partners representing
80% in value terms of the goods
and services we purchase, in orderto deepen our understanding of thedecarbonisation pathway for Scope
3 category 1 emissions. We have also
commissioned external research tosupport our understanding.

With external support, we areestablishing a detailed roadmap towards
our net zero carbon emissions targets,
and will submit both our targets andour roadmap to SBTi for validationin 2023/24.

The Board and its Committees will,through continued education and sharing
of information, aim to stay abreastof developments concerning climatechange and other environmental issues.

To support our progress towards net
zero, the Remuneration Committee has
considered and intends to implement
measures which recognise theimportance of our decarbonisation
activity, within future long-term incentive
structures, as reported on pages 146
to 147 of the Report and Financial
Statements 2023.
Through its quarterly Audit and Risk
Committee meetings, the Board has also
considered the Group’s wider climaterelated risks and opportunities and liaisedwith the Head of Internal Audit and Risk
to fully understand the methodologies
used to determine these. One of its focus
areas during the year was the integrationof the process for identifying, evaluating,and reporting on climate‑related risks
and opportunities across the Group into
the wider enterprise risk management
processes. This included the adoptionof a standardised methodology for
performing climate risk assessment.

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Strategy

Likelihood

We recognise that climate-related risks and opportunities could have a significant impact on ourbusiness model and strategy, both positive and negative.

Likelihood

Description

Highly unlikely< 10% likelihood that the risk/opportunity will occur with 2°C/4°C climate change

Recognition of the risks and opportunities relating to climate change is inherent in our purpose – to enable
a greener, healthier, more connected advanced society – and our business strategy, particularly in termsof the end markets and applications we address (see Report and Financial Statements 2023, Market
context, pages 28 to 29, and Strategy, pages 34 to 35). We are increasingly embedding climate changerelated considerations into strategy, including the following areas:Low

10%–20% likelihood that the risk/opportunity will occur with 2°C/4°C climate change

Moderate

20%–50% likelihood that the risk/opportunity will occur with 2°C/4°C climate change

Highly likely> 50% likelihood that the risk/opportunity will occur with 2°C/4°C climate change• Services strategy, where we are extending digital service offerings to reduce the amount of travel tocustomers and building remote connectivity into our products to facilitate remote diagnostics.
• Supply chain, where we are carrying out engagement in order to set and achieve appropriate Scope 3
emissions reduction targets.
• Product development, where we are embedding sustainability criteria into our stage gate processes
in order both to limit our Scope 1 and 2 emissions and to support customers in reducing theirown emissions.
We also consider financial implications of risks and opportunities using our Group and businessrisk reporting.
We consider climate-related risks and opportunities across the short, medium and long term, withthese timeframes defined, in line with our overall risk framework, as:
Impact time horizon

Year fromYear toQualitative work, to further develop our understanding of the potential impact on our business of climaterelated physical and transition risks and opportunities considering a range of climate change scenarios,
is ongoing. We have not yet undertaken specific scenario analysis and so are not able to report on the
key input assumptions, analytical methods or outcomes. We are working to determine the appropriate
methodology and modelling tools to be used to extend this exercise. We note that the approach may
comprise stakeholder engagement and the prioritisation of climate-related risks and opportunities
which may require deeper analysis via quantitative modelling. This work will ultimately support our
understanding of the resilience of our low carbon transition plan under different climate change scenarios.
The outcomes from further climate scenario analysis will be considered as part of our process for theassessment of climate change-related risks and will support our future climate-related financial planning.

Duration

Short term

2023

2030

<10 years

Medium term

2030

2050

10–30 years

Long term

2050

2100

30+ years

28

Climate scenario analysis

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Strategy continued
The climate-related risks and opportunities we have identified over the short, medium and long term.
Climate-related risks and opportunities are characterised in the terms set out below.
Physical risks

Transition risks

Physical risks stemming from geo-environmental
location events, including severe weather events(acute), or long-term changes (chronic) in climaticconditions can cause severe damage and disruption
to companies’ operations and supply chain andgenerate increased product prices.

With increasing scrutiny of company climate change-related
strategies, and as global net zero target-setting continues,
we are seeing market-related, regulatory and reputationalrisks develop.

Acute physical risks – Those that are event-driven,
including increased severity of extreme weather
events, such as increased heatwaves, droughts, fires,storms, cyclones, hurricanes or floods.
Chronic physical risks – Longer-term shifts in climate
patterns (e.g. sustained higher temperatures orrainfall patterns) that may cause sea level rise or
chronic heatwaves.

Technology risk – Technological improvements or innovations
that support the transition to a lower-carbon, energy-efficienteconomic system can have a significant impact on organisations.
Market risk – Whilst the circumstances in which markets could
be affected by climate change are varied and complex, one of
the major ways is through shifts in supply and demand for certain
commodities, products and services, as climate-related risks andopportunities are increasingly considered.
Policy – Policies that attempt to curb or constrain actions that
contribute to the adverse effects of climate change or that seek
to promote adaptation to climate change.
Legal actions – Recent years have seen an increase in climaterelated litigation being brought before the courts by property
owners, municipalities, states, insurers, shareholders, and public
interest organisations.

We have carried out a high-level assessment of the climate-related physical risks relating to our four
key manufacturing sites in the UK: our Head Office at Tubney Woods, near Oxford (NanoScience); Andor
Technology in Belfast; Oxford Instruments High Wycombe (NanoAnalysis and Magnetic Resonance) andOxford Instruments Plasma Technology, which currently operates from Yatton in North Somerset and issoon to move to new premises at Severn Beach (see page 21). These sites represent more than 80% of ouroperations in terms of revenue.
All four sites are at low (1% a year) or very low risk (less than 0.1% a year) from river, sea and surface water
flooding, based on published Environment Agency data and internal risk assessments, and therefore we
do not currently consider that any flood risk mitigation is required.
All manufacturing sites are required to consider the potential impact of climate-related risks as part oftheir business continuity plans and implement appropriate mitigating actions when required. Our head
office site, including the NanoScience manufacturing facility, is surrounded by woods, and the facilities
team works with the adjacent landowner (the Forestry Commission) to manage the risks associated withthe physical environment. As part of our ongoing work relating to climate change-related risks, Internal
Audit has been instructed to review existing business continuity plans during FY23/24 in order to identify
potential opportunities for improvement.
Over the coming financial year, we plan to carry out an assessment to cover our key remaining global
sites. We also consider climate risk when identifying new sites, such as our new offices in Tokyo, as
described on page 20.

Reputational risk – Arising from stakeholder perceptions ofan organisation’s environmental credentials, including any
contribution to, or detraction from, the transition to a lowercarbon economy.

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SUSTAINABILITY: TCFD STATEMENT continued
Impact

The climate-related risks and opportunities we see as most material
for Oxford Instruments are set out on the following pages. Opposite,
we set out our assessment of the financial impact should these arise.

RatingFinancial impact(risk or opportunity)

Transitional (2°C change)

Physical (4°C change)

SevereMore than £5m• Complete relocation of manufacturing• Relocation of facilities due to flood, excess heator wildfires• Significant change in supplier base

Major

Significant£2m – £5m

£1m – £2m

• Change in technology due to supply constraints• Potential for product obsolescence plus newmarkets and opportunities as the paradigm
shift required to deal with extremes of climatechange drives the emergence of new or
disruptive technologies (e.g. the hydrogen
economy) that previously might not have beencommercially viable• Investment in infrastructure required, for example
in relation to additional cooling, water supply
or power• Increased severe weather causing
continued disruption• Significant change in supplier base• Loss of customers due to global changes• Relocation of sales offices to another country• Investment in infrastructure required, for example
in relation to additional cooling, water supply
or power• Changing of suppliers• Multiple changes in supplier• Significant change in supplier base
NotableInsignificant

30£250k – £1mLess than £250k• Additional investment infrastructure to manage
global change• Relocation of sales offices to another country• Minor relocation of personnel• Relocation of sales offices within same country• Update of company fleet to electric vehicles• Changing of minor suppliers• Changing of suppliers

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SUSTAINABILITY: TCFD STATEMENT continued
The risks and opportunities which we consider to be most material for us at present are set out below.

Climate-related risks
Acute physical risks
Magnitudeof impact

Impactarea

Current risk
controls

Supply chain disruption Medium
leading to higher
term
prices or shortagesof raw materials.
Impact on increased
cost of sales or, in theextreme, disruption
to production until
normal supply
resumes or alternatives
can be found.

Significant

Operations

Long-term supply
agreements with key
suppliers can mitigate
short-term pricevolatility. Businessinterruption insurance
provides a degree ofcover in the event that
supply chain issues
cause significant
disruption to production.

Unforeseen relocations Medium
may lead to a shortterm
term hiatus in demand.
As a Group we mayneed to adapt andrelocate operations
ourselves to meet therevised geographicalprofile of demand.

NotableService
operations

Strategic review oflogistics, supply chain,manufacturing,and service operations.

Context

Risk impact

Severe event
disrupts global
supply chains

Flooding and/or othernatural disasters
linked to climatechange could leadto shortages in the
global availability of
key components.

Severe event
causes existingcustomers
to relocate
operations

Flooding and/or othernatural disasters
linked to climatechange could cause
customers to relocatefrom areas that are
particularly affected by
the physical impact ofclimate change.

TimehorizonLikelihood

Magnitudeof impact

Impactarea

Current risk
controls

Potentially ranging from Medium
short-term disruption
term
to operations if
employees are unable
to access facilities(e.g. due to roadclosures), to major
disruption in the eventof a total loss of the
manufacturing facilities.

Notable tosevereOperations
andcustomers

Business continuity
plans andglobal businessinterruption insurance.

Increased competition
for limited transport
options drives up theprice of transport,
affecting both goods
in and goods out.

NotableOperations
andcustomers

Strategic review oflogistics, supply
chain, manufacturing,and service operations.

Context

Risk impact

Extreme weather
impacts
operations

Disruption to
manufacturing
operations due to lossof infrastructure arisingfrom wildfires or otherphysical damage
related to climatechange. Particularly
relevant for operations
in California.

Extreme weather
impacts global
logistics capacity

Logistics disruption
due to extreme
weather events, or lossof infrastructure due
to rising water levels(reduced airport andport capacity).

Likelihood key

TimehorizonMediumterm

Likelihood

Time horizon key

Highly unlikely

Short term

Low

Medium term

Moderate

Long term

Highly likely

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SUSTAINABILITY: TCFD STATEMENT continued
Climate-related risks
Transition risks

Component
obsolescence
due to regulatorychanges (Policy
and legal)

Regulatory(Policy and legal)

32

Context

Risk impact

Ban on criticalmaterials or production
processes in either
our own operations
and/or our supply
chain as a result of
regulatory changes.

Rise in material
prices for switching tocompliant products
or disruption to
production if unable toreact in sufficient time.

The need to mitigate
and adapt to theimpacts of climatechange is driving rapid
regulatory change
across the globe.

Timehorizon

Short
term

Failure to keep pace
Mediumwith environmental
term
legislation andreporting requirements.

Likelihood

Magnitudeof impact

Impactarea

Current risk
controls

Significant

Operations

We have productcompliance processes
in place to manage
this type of change
in the regulatoryenvironment, withoversight and support
from the Group Headof Quality. We use
existing processes
to meet Restrictionof Hazardous
Substance (RoHS)
and Registration,
Evaluation,
Authorisation
and Restriction ofChemicals (REACH)
requirements, which
remain appropriate
to manage futurechanges in standards.

Significant

Operations

Context

Risk impact

Priceinflation fromdecarbonisation(Market)Global supply chains
implementing more
expensive production
methods and/or changes in raw
materials in order toreduce CO2 emissions.

Increased material
cost of sales leading
to reduced margins
without increases inselling price.

Reputation andinvestability(Market)Companies’ approachto mitigating andadapting to theimpacts of climatechange is now a key
factor in customers’
and shareholders’purchasing andinvestment decisions.

Failure to decarbonise
and address climate
impacts at sufficientpace, leading toloss of shareholders
and customers, andreputational damage.

TimehorizonMagnitudeof impact

Impactarea

Current risk
controls

Short
term

Significant

Operations

Product Development
and Strategic Sourcing
teams identify andevaluate viable
alternatives in materials
and processes andwork closely withkey suppliers to deliver
supply chain solutions.

Mediumterm

Significant

Customers, Board-level scrutiny
shareholders, and oversight, andsocietyan organisation-wide
focus on addressing therisks and opportunities
arising from climatechange, together witha focus on impact
reporting, wider
communications
and stakeholder
engagement.

Likelihood

We have dedicatedinternal risk, legal
and environmental
management resource,
as well as investing inexternal consultancy,
to ensure that weare aware of, andremain compliant
with, legislation. Our
adoption of ISO 14001
accreditation at our four
UK manufacturing sites
at Belfast, Bristol, High
Wycombe and Oxford
supports our mitigationof climate risk.

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SUSTAINABILITY: TCFD STATEMENT continued
Climate-related opportunities
Context

Investment in
R&D required for
decarbonisation(Transition:
Technology)

Geopoliticaluncertainty
and resourcecompetition(Transition:
Regulatory)

33

Opportunity
impactTimehorizon

Product innovation
will be required todecarbonise theeconomy. It will entail
significant expenditure
on research anddevelopment into
new materials,
technologies, andnew ways of working.

Due to the requirement Shortfor decarbonisation,
term
demand for Oxford
Instruments’ products
and services
may increase.

Geopolitical tensions
may arise from climatechange, leading toincreased requirement
for local development
and manufacturing
capacity in thegrowing markets of
Semiconductor &Communications andQuantum Technology.

Increased demandfor enabling
technologies resulting
in an increased
market opportunity
for our business.

Likelihood

Magnitudeof impact

Impactarea

Significant

Customers, Our products andshareholders, services play a key rolesocietyin the technology
pathway to enable thetransition from fossil
fuels to a low-carbon
economy. Our enabling
technologies,
such as materials
analysis solutions
and semiconductor
equipment, help
customers addressthese challenges.

Significant

Shareholders We continue to invest in
our product portfolio toassist our customers indelivering their global
and regional roadmaps
and supporting
sufficient manufacturing
capacity by location.

Product innovation
as a result of
decarbonisation may
help reduce operating
costs, e.g. throughremote delivery
services.
Short
term

How we arecapitalising

Magnitudeof impact

Impactarea

Increased demand
Short
for remote service,term
training, analytics anddiagnostic solutions,enabling a faster
response, higherquality customer
experience and more
efficient deploymentof personnel within-demand skills
such as service
engineers, applications
specialists, etc.

Significant

Customers, Designing remoteconnectivity into ourserviceemployees, products andthe company building businesssystem infrastructure
to enable remote
service capabilities.

Increased demandfor our products andservices that enable
the development of
more efficient battery
technology andhighly efficient energy
conversion devices.

Significant

Shareholders, Increased investment
customers,
in key enabling
societytechnologies such as
analytical instruments
and semiconductor
equipment that are
key in the transition
to renewables.

Context

Risk impact

Accelerated
customer
adoption of
remote services
solutions(Transition:
Market)As the Group and its
customers seek toreduce the emissions
arising from theiractivities, the nonfinancial business casefor remote service
solutions will become
increasingly compelling.

Migration fromfossil fuels
to renewableenergy (Transition:
Market)

The path to net zerorequires migration fromfossil fuel energy torenewables (e.g. frominternal combustion
engine vehicles toelectric vehicles). The
speed of change islikely to be accelerated
by geopoliticalsupply concerns
over fossil fuels.

Timehorizon

Short
term

Likelihood

Current risk
controls

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SUSTAINABILITY: TCFD STATEMENT continued
The impact of climate-related risks
and opportunities on our businesses,
strategy and financial planning.

Risk management

We consider climate change to be aprincipal risk for Oxford Instruments, butalso a source of material opportunity,
given our focus on enabling a greener
society and the end markets we serve.
Our assessment is based on having
evaluated key climate-related risks andopportunities, including understanding
the potential impact of each in termsof its time horizon, likelihood andmagnitude, and the stakeholders or areasof the business that may be affected.

We define risk as uncertain events
which could have an adverse impact on
the Group’s business model, financial
performance, liquidity or reputation.
Our approach to identifying andassessing risks and opportunities is set
out in detail in the Risk Management
section on pages 94 to 101 of the Report
and Financial Statements 2023.

During FY22/23, we have worked toprioritise the actions needed to mitigate
these risks and capitalise on theopportunities, basing this on their impact
and ease of implementation. We are now
focusing on integrating these actions
into our strategy, product development
roadmap and financial planning.

34

Our process for identifying andassessing climate-related risks.

Throughout the year we maintained aseparate process for the identification
and assessment of climate changerelated risks, distinct from the wider
enterprise risk management process,although the results of the assessments
are now integrated into the businesses’quarterly risk reporting framework. This
process is adapted to ensure that thenuances required by the TCFD reporting
framework are captured and thatclimate change-related opportunities
are highlighted.

When assessing climate-relatedrisks, we consider both the impact
and likelihood of occurrence acrossshort, medium and long-term impact
time horizons, as defined above, andconsistent with our wider organisationalrisk framework. This provides an inherent
risk score which is then used to rank
our risks.
Climate-related risks and opportunities

Our process for the assessment andmanagement of climate-related risks
and opportunities across all business
units and regions mirrors the processthat the Group uses for wider enterpriserisk management (see pages 94 to 96
of the Report and Financial Statements
2023). Risks and opportunities areevaluated against a scoring matrixof likelihood and impact. Likelihood
considers the probability of the risk oropportunity occurring, whilst impact
evaluates the magnitude of the potential
consequences, whether in financial,
reputational or other terms.

The guidance used when assessing
impact and likelihood are as set out
below and the ratings are aligned tothose used as part of our wider enterpriserisk management process.
Climate risk assessment is carried out
on a quarterly basis ahead of being
reported to the Board via its Audit andRisk Committee. As with wider enterpriserisks, the Board as a whole is responsiblefor determining how risks are to
be managed.
Our processes for identifying climaterelated risks include granular assessmentsfrom individual businesses and region,
combined with a Group-level review,
particularly through horizon-scanningfor regulatory changes. This is carriedout by the legal and regulatory, productmanagement and health and safetyfunctions. Further, internal assessments
are complemented by input from external
advisors. New regulatory requirements are
implemented as they arise and any further
actions taken as appropriate.

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SUSTAINABILITY: TCFD STATEMENT continued
Metrics and targets
We currently use a range of metrics
to help us to track our progress
across a number of climate-related
and sustainability-related areas. This
includes assessment of our electricity
consumption, Scope 1 and 2 emissions
in line with the Greenhouse Gas Protocol
methodology, water and waste, the useof hydro fluorocarbons and the impactof transport. Please see the environment
section, pages 18 to 23 for further
information, and for an abridged versionof this year’s SECR reporting, the primarymeans by which we report our impact.
As set out in the environment section, weare committed to reaching net zero carbon
emissions (where we add no incremental
greenhouse gases to the atmosphere)
against Scopes 1, 2 and 3 by 2045, inline with a ‘well below 2° scenario’. We
are further committed to monitoring andcalculating our carbon footprint in linewith industry standards. We have set ourinterim targets at a 50% reduction in Scope
1 emissions by 2030 and a 70% reductionin Scope 2 emissions by the same date,
both against a 2018/19 baseline.

35

During the year we have worked withan external consultant to validate
our assessment of our Scope 1 and 2
emissions, and the carbon footprintof our baseline year (2018/19). In the
coming financial year, we will submit our
Scope 1, 2 and 3 targets and roadmap
to the Science-Based Targets initiativefor validation.
Our footprint for Scope 1 and 2 emissions
is calculated and reported in absolute
numbers against our baseline year; wealso use an intensity metric (tonnes of
CO2 equivalent per £ revenue) in order tohelp contextualise our performance as
our business grows.
We are committed to working with
our supply chain to reduce our Scope
3 emissions, the largest element of
our environmental footprint. We havebegun engagement with our top 80
suppliers (see page 19) and have also
commissioned external research into
the decarbonisation pathway for key
components, to inform our interim target
setting for Scope 3 emissions and ensure
that, while ambitious, it is evidence based
and achievable. We anticipate being in aposition to set interim targets in 2023/24.

Overall, we consider ourselves partiallycompliant with the recommended
disclosures on cross-industry targets andmetrics. To drive behaviours in line with
our focus on reducing GHG emissions, a
new measure is being incorporated into
remuneration objectives for Executive
Directors. The measure, to be confirmed
at our 2023 AGM will require continued
reductions in our Scope 1 and Scope
2 emissions. Over the coming year,
we will give consideration to further
metrics and targets in line with the TCFD
recommended disclosures.
We are also developing metrics tomeasure the positive impact that our
portfolio provides in enabling a greener,
healthier, more connected advanced
society. Assessing our progress towards
reaching these targets will then forma crucial part of the future work of the
Sustainability Committee.

“We are committed
to reaching net zerocarbon emissions
by 2045. As anambitious, progressive
company, we believe
it is important to set
stretching targets forourselves and our
supply chain.”
Ian Barkshire
Chief Executive

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SUSTAINABILITY: SOCIAL

Social:We believe thatbusinesses have avaluable contribution

to make in the development ofsocieties that enable theirmembers to thrive

Our responsibility to our employees
We are dedicated to being a truly sustainableorganisation and are keenly aware of our responsibility to
our employees, the communities that we impact and thegenerations to come. By listening to our stakeholders (seepages 112 to 117 of our Report and Financial Statements
2023) and taking action now, we are resolute in ensuringthat we have a positive impact on the world around us.
We work hard to create a progressive business culture,keeping pace with rapid social change, and seeking tostay ahead of the curve on our key sustainability themes,
while remaining respectful of the cultures of the countries
that we operate in.

Our social sustainability agenda
Our social sustainability agenda comprises six key
subject areas, as follows, where we have establishedstrategies to support us in achieving our ambitions
and targets:• Culture, values and engagement• Equality, diversity and inclusion• Health, safety and wellbeing• Investment in our people• Next-generation talent• Community impact.

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SUSTAINABILITY: SOCIAL continued
Culture, values and engagement

Equality, diversity and inclusion

Our purpose – to enable a greener, healthier, more connected advanced society – and our values,
set out below, drive our approach to doing business, and help us build an open and inclusive culture,
where colleagues feel able to share their views in a two-way dialogue with senior leaders. The Chair
and Non-Executive Directors have regular informal meetings directly with staff at which a wide rangeof current workforce issues are discussed, and we hold regular Chief Executive town halls to which
all employees are invited, and where they are encouraged to ask questions of the Chief Executive
and senior leadership. Similar meetings are held by all business units, and by our regional teams
based around the world. We also gather our people’s views annually through our global engagement
survey, monitoring a range of cultural KPIs and taking action on any opportunities for improvement at
business unit, regional and Group level. Our overall engagement score was 78% (up 1%), comparing
favourably with external benchmarking by Gallup indicating an average engagement rating of 21%
globally across a range of sectors.

We are committed to creating a diverse and inclusive culture right across Oxford Instruments, creating a
sense of equality and belonging.

Our values

We have identified several key areas of focus, including gender, ethnicity, disability, sexual orientation andgender identity, pursuing a range of initiatives to recruit from a diverse pool of talent, and to support ourexisting workforce. We have joined Business in the Community and the Business Disability Forum as part ofour continual drive to improve our awareness and understanding of research and best practice in diversity
and inclusion for businesses. We also engage in externally run schemes offering internships and career
opportunities in our diversity and inclusion focus areas. During the year, employees have launched impact
groups focusing on race and ethnicity and LGBTQ+ issues; these have been enthusiastically adopted byboth members and allies of each community. In the coming year, our plans include the launch of a women’sgroup and a neurodiversity group.

Inclusive

Innovative

TrustedPurposeful

By seeking out different
perspectives and diverse
collaboration, we deliver
better solutions andlasting success.

Through our knowledge,
expertise and focusedcuriosity, we create new
possibilities for ourselves
and for our customers.

We build successful,long-term relationships
based on accountability,
integrity and respect.

We care, and our passion
and commitment drive
positive change inthe world.

37

In everything we do, we seek to develop and sustain a supportive and collaborative working environment
where difference is recognised, valued and celebrated, and where all our people feel able to be open about
their own unique identity.
Equality, diversity and inclusion are important for all our people and society as a whole; however, we also
recognise that we operate in 17 countries around the world in which the legislative frameworks and culturallandscapes vary hugely. In each of the countries in which we operate, we aim to be ahead of the curve in ourequality, diversity and inclusion targets, and our working practices, but will ensure that we are not in conflictwith legislative frameworks. We are pleased that 83% of respondents to our recent engagement survey feel
everyone is treated with respect at Oxford Instruments, and that more than three quarters feel we strive for adiverse mix of employees, but cognisant that there is no room for complacency.

We are committed to eliminating our gender pay gap. We are only required to report in the UK, where thegap currently stands at 7.5% (mean) but are monitoring, measuring and taking action globally. We continue
to build on the work we have done so far to establish balanced shortlists in our recruitment processes, only
engaging executive search firms who have signed up to the Voluntary Code of Conduct on gender diversity.
Our inclusive approach to recruitment includes the use of technology to ensure that the language used in
job advertisements is free from gender bias. We have introduced e-learning for hiring managers, including
a course on unconscious bias, and have also carried out training on interview and selection techniques,reaching some 40 managers in 2021/22.
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Governance

SUSTAINABILITY: SOCIAL continued
Equality, diversity and inclusion continued

Targets:

We have introduced a permanent hybrid working
policy as a result of our learning throughout
the pandemic which helps employees to betterbalance their work and personal commitments.
Following the reconfiguration of our internal
employee data portals to include the Office for
National Statistics ethnicity categories, some 70%
of employees globally have provided data on theirethnicity. We are now beginning to use this data tohelp to ensure that our processes and pay are fairand equitable with respect to race and ethnicity, as
well as the characteristics on which we have hadfull data for several years.

New employees in FY22/23
by gender

Male
Female

38

68%
32%

Gender split

Gender split by region
Male

FemaleGlobal Oxford
Instruments

74%

26%

Plc Board

62%

38%

Management
Board

86%

14%

Managers

79%

21%

Employees

72%

28%

Male

Female

UK

77%

23%

Europe

69%

31%

Asia

70%

30%

America

70%

30%

Objective

Target (with date if applicable)

Progress to date

Balanced shortlists for recruitment

100%

End of 2022/23: 83%

Ethnicity representation on the Board

By end of 2022/23: 1 personof colour

Following the appointment ofReshma Ramachandran as NonExecutive Director in September
2022, we have met this target

Women on the Board

By end of 2023/24: 40% womenWith three of eight positions
now held by women, we haveexceeded the 33% target set by
the Hampton-Alexander Review
and will meet the FTSE Women
Leaders target of 40% of Board
members being female when
Professor Sir Richard Friend’s
term of office comes to a closein July 2023

Women as a proportion ofsenior leadership

By end 2025: 40% women

Currently 31%

Women as a proportion of total
Oxford Instruments population

By end 2029/30, 30% women

Currently 26%

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SUSTAINABILITY: SOCIAL continued
Health, safety and wellbeing
We are committed to achieving a high standard of health and safety for anyone involved in, or affected by, ouractivities. We strive to provide a safe workplace and working environment for all employees wherever they work.
Our approach is based on the ongoing identification and control of risk. We focus on preventative measures toremove hazards before they can escalate into accidents or near misses. We apply safe working practices supported
by structured health and safety management systems, that are externally audited where appropriate. We maintain
ISO 45001 occupational health and safety certification at our four primary manufacturing sites, representing 83% ofrevenue. Each area of the business undergoes a health and safety audit at least every three years.
We have broadly maintained our overall accident frequency trend downwards, with no serious accidents in
2022, and a small increase in minor accidents. Our health and safety record compares favourably with industry
benchmarks. However, there is no room for complacency, and health and safety is a priority at all our sites
worldwide. We continue our Push for Zero programme, with the objective of a sustained reduction in accident
levels across the Group. We record accidents and safety observations on our SHIELD health and safety software
platform, and take corrective action to prevent recurrence.
Our new six-step strategic framework for healthand safety will be rolled out globally in 2023/24

Health and safety five-year performance**

We take a holistic approach to wellbeing, and firmly believe employees and their families deserve to haveaccess to the right mental health support to help them feel their best in a supportive culture. We aim to
give people the tools to keep themselves, their colleagues and their families healthy; we encourage themto access support when it’s needed, and we empower people with long-term mental health issues or adisability to thrive in work.
We continue to support our team of Mental Health First Aiders and provide independent and confidential
digital platforms and services that employees can access wherever they are based in the world.
We are also committed to supporting colleagues experiencing tough times in their personal lives,
whether through family commitments, illness or bereavement, taking a bespoke approach to eachindividual’s circumstances.

Target:Objective

TargetComments

Serious accidents

Zero

No employees should experiencea serious accident at work

Accident frequency rate

Continuous improvement

Push 4 Zero aims to reduce theaccident rate year-on-year

Calendar year measure.

55Culture1
Collaboration

Control

Healthy, safeand productive
workingenvironments
Competence

0

31

28

21

20

21

2018

2019

2020

2021

2022

Communication

Clarity

Minor

39

1

Serious

Accidents per 1,000

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SUSTAINABILITY: SOCIAL continued
Investing in our people

Employee turnover rates:
Year

Turnover2022/239%2021/2211%

2020/216%

2019/20

7%

2018/1910%

2017/18

12%

Geographical spread of employees(at the end of FY22/23)

UK 58%

Asia 17%
Europe 10%
Americas 15%

40

Our people and their capabilities are coreto what makes us a great company. We
want our employees to be successful,to realise their full potential and to
be able to make a difference. We arecommitted to being the company where
the best people in our sector want towork, and we offer high-quality, stable
employment and flexible careers withfavourable conditions and pay. We offera broad range of career development
opportunities across technical,
commercial, operational and businesssupport functions.
We provide a range of opportunities forour employees to gain knowledge, skills
and experience to achieve individualand organisation goals. This includes
challenging assignments, learning fromcolleagues and targeted training. Our
talent management processes attract
talented people and develop theircapabilities to meet our current andfuture business needs. We integratethese processes within our businessplanning cycle.

We continue to strengthen our Oi
Academy, which offers development
programmes, core skills training
courses and extensive e-learning
opportunities. We also offer a broad
range of secondments, career breaks,
apprenticeships and support towards
external qualifications. This year, threecohorts have undertaken our bespoke
Oi Leadership programme, which brings
together high-potential candidates fromacross the Group and covers a wide
range of topics including interviewing
skills, self-development, developing
others, and managing remote teams.
We have developed indicative Career
Pathways to deliver career mapping
for all roles across the Group, allowing
employees to utilise this information
to review potential career pathwaysof interest to them across technicalor functional leadership, businessleadership and specialist versus
generalist routes. We have a robust
system of regular feedback, embedded
through our annual performancedevelopment review process for all
employees, which also encompasses
career development with a focus on
training opportunities.

We are committed to building theskills that society needs now and in the
future by investing, over the long term,in our people.

Next-generation talent
We take our responsibility towards
developing the next-generation
workforce seriously and are committed toinspiring the next generation of scientists,
engineers and business people byshowing them the difference they canmake in the world, and by providing work
experience and employment skills anddevelopment opportunities.

We remain committed to providing
structured apprenticeships, sponsorships,
internships, early career jobs andgraduate programmes. We intentionallyreach out to attract a diverse rangeof people and those from untapped
talent pools, ensuring we are inclusive
and accessible.

For us, this begins in schools, colleges
and learning institutions, where weequip and encourage our employees
around the world to take any opportunity
they can to talk to young people aboutcareers in our industry. We partnerwith universities and post-graduate
schools to help students understandthe range of careers available in atechnology company, supporting thiswith work experience and engagementwith employees from a broad rangeof backgrounds. A popular benefit weoffer all employees is the offer of work
experience to family members between
the ages of 16 and 25.
www.oxinst.com

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Sustainability Report 2023

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SocialGovernance

SUSTAINABILITY: SOCIAL continued
Community impact
We actively engage in locally focused
activities that make our communities
and environments a better place to live
and work. All employees are offered up
to two paid volunteering days a year toshare their professional or practical skillsin the community; we also participate incharity outreach programmes and offer
sponsorship of local community events.
Our network of Go Green teams help
us look at better ways to be moreenvironmentally friendly, both as abusiness and as individuals. We havetaken steps to minimise traffic noise andcongestion around our sites and remaincommitted to minimising emissions fromour own activities, as set out on pages
18 to 23. We have appointed a new senior
manager to lead our environmental
sustainability activity.

When we arrange gifts, celebrations,
events and activities for our teams we
aim to support the small, independent
businesses near our sites.
During the year, across our sites,
we organised a number of activities
that supported our local businesses.
This included bringing a barber on site,running exercise classes, and dog walks.
We also participated in a range of charity
outreach activities, including raffles,
marathon sponsorships, pub quizzes
and coffee mornings.
CASE STUDY

Welcoming a record
number of apprentices
February 2023 saw us launch our largest ever cohort of apprentices,with roles created at all four of our manufacturing sites in the UK. Our
programme spans a wide range of disciplines, from engineering tosoftware development and marketing, and with opportunities frompost-school level to graduate level. We are delighted to be supportinga new generation of talented people through well-paid, high-quality
training, equipping them with skills and qualifications for life. For more
information, visit www.oxinst.com/apprenticeships

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www.oxinst.com

Oxford Instruments plc
Sustainability Report 2023

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SUSTAINABILITY: GOVERNANCE

Governance:

We are committed to

upholding high ethicalstandards; we all want towork for a company ofwhich we can be proud

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Inclusive, innovative, trusted and purposefulWe are wholly committed to conducting our business
responsibly and holding ourselves to a high ethicalstandard. Our brand and reputation are built on our strong
values, which underpin everything we do; from how wework with each other and how we support our customers,
to how we trade with suppliers.
We are inclusive, innovative, trusted and purposeful (seepage 37). Every Oxford Instruments employee is expected
to behave in a way which is consistent with these values.

Following best practiceIn our governance practices, we address the wide rangeof corporate activities we undertake, the policies wehave in place and our management structure. These aresummarised in our Code of Business Conduct and Ethics,
which is updated regularly, issued to all new joiners andcommunicated regularly to existing employees. We strive
to adapt to the changing landscapes we operate within,with the goal of ensuring that we always operate within
the bounds of best practice.

www.oxinst.com

Oxford Instruments plc
Sustainability Report 2023

Overview

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SocialGovernance

SUSTAINABILITY: GOVERNANCE continued
Our governance sustainability agenda
comprises eight key areas.
Anti-bribery and anti-corruption
When dealing with business partners,
suppliers and customers, or whenengaging with public officials, we expect
our employees to act in a transparent
and fair manner. We choose our business
partners and suppliers carefully andavoid working with anyone who does
not meet and adhere to the samehigh standards.
The key principles we expect everyone tofollow include not offering or accepting
bribes or improper payments; not
improperly influencing any individual; andnot participating in any kind of corrupt
business activity, either directly or througha third party. To help our employees
understand what is expected of them
we have developed a comprehensive
training course which all new joiners
must complete to pass their probationary
period, and which all those in relevantroles must retake regularly; we also
maintain a detailed policy document.

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Adherence to our due diligenceprocedure for the onboarding of thirdparty agents and distributors continues
to be regularly audited, and training
is delivered by our Group Legal teamto all new Finance Directors andContract Managers.
Sanctions, export control and customs
We review our Sanctions Policy regularly
to confirm compliance with UN, UK,
EU and US sanctions; and following
Russia’s invasion of Ukraine haveexceeded the scope of internationalsanctions by imposing a Group-wide
ban on any transactions involving
Russia and Belarus.
We have adapted our processes to
respond to changes in UK legislation
relating to export controls, which became
effective in May 2022, and which had
the effect of formally extending military
end-use controls to China (including
Macau and Hong Kong) beyond
military organisations to encompass
the police, intelligence services andsimilar organisations and entities
that supply them.

During the year the Group Export
Compliance team has standardised
operating procedures for all UK
businesses, including enhanced due
diligence around identification of end
users in China, and has instigatedquarterly compliance audits. To datethese audits have indicated 100%
compliance with procedure.

access to inside information to those
who need to know it; (iv) to monitor
compliance with our obligations underMAR, including the detailed recordkeeping requirements; and (v) to ensurethat the Financial Conduct Authority is
notified of any delayed disclosure on
announcement of the inside information
to the market.

Dissemination of inside information to
the market, and share dealing

We maintain and update a secure listof anyone who has access to inside
information, whether on a regular or
occasional basis, and ensure that anyone
working on our behalf or on our accountdoes the same. We ensure that those on
the list are aware of and acknowledge
the legal and regulatory duties requiredof them while on the list.

We take steps to ensure our compliancewith the obligations arising from theListing Rules, Disclosure Guidance
and Transparency Rules, the Criminal
Justice Act 1993 and the UK Market
Abuse Regulation (‘MAR’) in relation to
the dissemination of inside information
to the market, which includes our sharedealing policy and procedures.
We ensure that there are adequate
procedures, systems and controls: (i) to
identify inside information and ensurethat any inside information identified isproperly considered by the Directors and,
where necessary, disclosed to the market
promptly; (ii) to enable the Directors toassess whether the company can delay
disclosure to the market; (iii) to restrict

The Company Secretariat is responsible
for ensuring compliance in this area.
Supply chain responsible sourcing
We operate our business in compliancewith applicable laws and regulations
and we expect our suppliers to do thesame. Our expectations are set out in
our Code of Conduct for Representatives
and Suppliers, which is available on our
website: www.oxinst.com.

In addition, we endeavour to include a
provision within our purchase contracts
with suppliers, whereby suppliers are
asked to warrant that they and theirsub-contractors will comply with allapplicable laws, statutes, regulations
and codes relating to modern slavery,anti-bribery and anti-corruption, andOxford Instruments’ Code of Conduct for
Representatives and Suppliers.
We use an approved vendor list for the
supply of continuous-use production
materials, which is managed by Group
Strategic Sourcing. All key suppliers on
this list must complete a governancequestionnaire via an online supplierportal, to confirm their compliance with
our Code of Conduct for Representatives
and Suppliers, together with applicablelegislation. In the year we have focusedon ensuring that we have up-to-dategovernance questionnaires for all
key suppliers.

www.oxinst.com

Oxford Instruments plc
Sustainability Report 2023

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Sustainability Report

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SocialGovernance

SUSTAINABILITY: GOVERNANCE continued
We are committed to sourcing our
supplies responsibly and supporting
global efforts to eliminate the use of socalled ‘conflict minerals’, sourced frommines which support or fund conflict.
We undertake due diligence on our
key suppliers and expect them, in turn,to conduct due diligence on their own
supply chain to help eliminate the useof conflict minerals.

Bespoke training is mandatory for relevant
employees to help them recognise where
there may be risks of modern slavery andhuman trafficking within our business andour supply chains. The training has recently
been updated to specifically reference
the International Labour Organisation’s
11 indicators of forced labour and explains
how they can be used to help identify
victims of modern slavery.

Our online supplier portal allows us
to store and audit our key supplier
documents and is being extended
to collect information on productenvironmental compliance, quality andsustainability. During the year our Group
Strategic Sourcing team has worked
closely with WITec to align their policies
and processes with the rest of the Group.

We have an established Reporting a
Business Malpractice Procedure for
employees to report any concerns,
and further guidance is also madeavailable in our Global Human Rights
Policy. We encourage employees to use
both documents in their due diligenceof suppliers.

Human rights and modern slavery
We are committed to preventing acts ofmodern slavery and human trafficking
from occurring within our business andsupply chain. We take a zero-tolerance
approach to all forms of modern
slavery, including servitude, forced
bonded and compulsory labour, andhuman trafficking.

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In addition, our global Code of BusinessConduct and Ethics, referenced on pages
42 and 45, sends a clear message to ouremployees, business partners, investors
and other stakeholders about our businessprinciples and ethics.

Our Board Sustainability Committee,
chaired by Sir Nigel Sheinwald provides
a direct overview of our Environmental,
Social, and Governance (‘ESG’) agenda.
Modern Slavery prevention is one of theeight key areas under the Governancesection of the ESG agenda andaccordingly has the full focus of the
Sustainability Committee.
Our Corporate and Social Responsibility
Forum has helped to develop a ‘Supplier
Portal’ which provides an online tool
to help us better undertake and audit
supplier due diligence.
Our Anti-Slavery and Human Trafficking
Statement is updated annually andcan be found both on our website andon the Government’s Modern Slavery
Statement Registry.
Intellectual property and confidentiality

We continue to protect our inventions,brand and designs through the useof registered IP rights. In the year
we filed a number of new priority
patent applications.
As the basis for protecting our trade
secrets we have in place a wellestablished process for preparation,
review and signing of all confidentiality
agreements. All employees are able todownload a standard set of templates,
along with guidance and training on
how to complete these templates on
our internal SharePoint pages.
Oxford Instruments often collaborates
with third parties on projects which
generate new IP, further enhancing our
product offerings to our customers. In
these situations, we will not use any
IP without it first being legitimately
acquired or licensed.

Data protection, data privacy anddata security
Our global privacy standard sets out the
principles that guide our approach tohandling personal information, and all
employees are required to undertake
mandatory training on data protection.
We continue to run training sessions toensure that marketing lead generationand other marketing activities arecompliant with the European General
Data Protection Regulation (‘GDPR’), UK
GDPR and related privacy legislationin other territories. Over the year ourlegal team has worked closely with ourmarketing and IT teams, providing dataprotection support on projects including
the rollout of a new global CRM systemand service portal, and changes in IT
software providers.

Our intellectual property (IP) is one ofour most important assets; it is key toour success in the market and enables
us to secure and maintain a competitive
advantage. We have comprehensive
policies and procedures in place toprotect our IP.

www.oxinst.com

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Sustainability Report 2023

Overview

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Sustainability Report

Environment

SocialGovernance

SUSTAINABILITY: GOVERNANCE continued
From September 2022, a change in thelaw resulted in the need to use a new
UK version of the standard contractual
clauses to govern our cross-bordertransfers of personal data outside theUK. We have commenced a project toupdate existing contracts between our
subsidiaries within the Group and alsowith third party suppliers and partners
before the end of the grace period in
March 2024. Similar legislation andguidance regarding cross-border transferof personal data outside of China hasrecently been released and we arereviewing our data protection complianceprogramme in China to ensure we areready for these changes before the endof the grace period later this year.
We continue to stay on top of developing
compliance programmes around theworld to ensure we can respond quickly
to any changes made in the dataprotection legislation. During the year,
we worked with local lawyers in Japan to
update policies and procedures following
amendments to the local data protection
regime, and have also delivered acompliance programme covering
regional data protection changes in
the US.

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Financial sustainability andtax transparency
The Group continues to maintain a focus
on cash generation to ensure we arefinancially stable and we have published
our policy within the Sustainability sectionof our website.
We manage our tax affairs in accordancewith the following objectives:• ensuring compliance with all relevant
tax law in all jurisdictions in which theGroup operates whilst managing theassociated tax costs in a manner thatis consistent with our Code of BusinessConduct and Ethics and its attitude tocommercial risk;• seeking to maintain stable effective
and cash tax rates which reflect thegeographic markets in which we
operate, and the Group’s tax attributes,
such as brought-forward losses andspecial deductions such as for researchand development; and• ensuring that all communication
with tax authorities is conducted in atransparent and professional manner.

CASE STUDY

A strong ethicalfoundation
At Oxford Instruments we strive to be inclusive,
innovative, trusted and purposeful. These values
underpin everything we do; from how we workwith each other and the way we support ourcustomers to how we interact with our suppliers.
To that end, and in order to reflect our ongoingstrong progress on environmental,social and governance issues, we
significantly updated our global
Code of Business Conduct and Ethics
in the year. The Code sets out ourvalues and the standards we expect
all colleagues to uphold, and plays
an important role in reinforcing thepositive and responsible culture weseek to build.

www.oxinst.com

Oxford Instruments plc
Tubney Woods,
Abingdon,Oxfordshire.
OX13 5QX.
t: +44(0)1865 393200
e: investors@oxinst.com
www.oxinst.com