Health, safety and environment
The effective management of health, safety and the environment (HS&E) is an integral part of how Rolls-Royce conducts its business and is consistent with its core values of reliability, integrity and innovation. This approach is reflected in the Group HS&E policy and in the role of the HS&E committee, which operates as a sub-committee of the Board, in line with corporate governance principles.

The scope of the environmental steering group was extended in 2000 to cover health, safety and the environment. The role of the steering group is to share best practice and facilitate the implementation of key HS&E initiatives throughout the business.

The Rolls-Royce HS&E management system was developed and disseminated to all Group companies in the course of the year. It builds on the systems already in place and is based on effective risk management. It requires the visible leadership and commitment of management at all levels and the active participation of all employees and contractors in its implementation.

The Group continued to maintain a low level of lost-time injuries over the year, well below the average for the manufacturing sector. The directors regret, however, that an employee died whilst working on a third-party site as a result of being struck by a vehicle driven by a third-party contractor. All such serious incidents are subject to a detailed accident investigation and review by the major incident board. The lessons learnt are then shared across the Group.

Rolls-Royce continues to develop the environmental management systems of its businesses worldwide to meet the requirements of the international standard ISO 14001. By the end of 2000, all the core businesses, which were part of the original programme, had achieved ISO 14001 certification. New businesses joining the Group through acquisition have a target of gaining certification within two years of operation under Rolls-Royce control.

In North America, Rolls-Royce Corporation received a ‘2000 Governor's Award for Excellence in Pollution Prevention' in recognition of its move from the use of coal to landfill/natural gas in three industrial boilers. This has resulted in a significant reduction in air pollutants and greenhouse gas emissions. In the UK, Compressor Systems received the award ‘Vision in Business for the Environment of Scotland', in recognition of  the successful integration of environmental objectives into the everyday management
of the business.

The Group's nuclear facilities continue to operate under strict control and are overseen by either the Nuclear Installations Inspectorate or the Ministry of Defence. These facilities were also subject to a rigorous health, safety and environmental audit as part of the Group's corporate audit programme. A sub-committee of the Board, details of which are set out on page 27, is responsible for the monitoring of HS&E issues at these facilities.

The environmental performance of Rolls-Royce products has improved significantly. Tools such as ‘life cycle analysis' and ‘design for the environment' are being developed to evaluate and minimise the environmental impact of our products. As part of a wider programme, materials and processes with potentially undesirable health, safety or environmental consequences have been identified and this information is used in the design of future products.

A valuable initiative during 2000 was the formation of an Environmental Advisory Board (EAB) under the Chairmanship of Sir Robin Nicholson. The role of the EAB is to review and make recommendations on the environmental aspects of the Group's activities, including business, product and operational strategies. The Board includes third-party members, who are respected authorities in their field.

Rolls-Royce has set challenging targets for improving the key environmental impacts of its products and operations. These targets and the progress towards them will be published in our external reports on the environment. The Group aims to produce its second external report on the environment in 2001. It is intended to publish the full report on the Rolls-Royce web site. Copies of a paper report will also be available on written request to the Company Secretary.