Annual Report
& Accounts 2022
science-
based
customer
excellence
for an ever better world
B
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o
k
o
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e
strategic
report
Intertek has a proven track record of
delivering sustainable growth and value
for all stakeholders which is testament
to the strengths of our 5x5 differentiated
strategy for growth.
We are pleased to share with
you our Annual Report & Accounts
in a unique, three-book format:
Book one – Strategic Report
Book two – Sustainability Report
Book three – Financial Report
These separate, but connected books,
with their interconnected themes and
narratives, allow us to present what
we achieved in 2022 in a systemic,
end-to-end architecture.
They have been designed to make it easier
for our stakeholders to fully understand our
business, how we bring quality and safety
to life, what we offer our clients and society,
and the opportunities we have ahead of us.
The three books, which allow us to
present our work in 2022 to you through
the three important lenses of growth
opportunities, sustainability goals and
financial performance, should be read
together to form our Annual Report &
Accounts 2022.
Look out for these throughout the report:
Reference to another page in the
report or to an external web page
Intertek Sustainability Disclosure Index
Online Review 2022
this report
Strategic Report
Sustainability Report
Financial Report
Financial Report
Where we discuss our growth
opportunities and strategic
performance.
Where we discuss our
environmental, social and
governance progress.
Where we record our
financial activities,
performance and position.
5 Chief Executive Officer's letter
1
Chief Executive Officer's
1 Consolidated income statement
10 Our 5x5 strategy
14 Our business model
15 Who we are
16 What we do
18 Our sectors
19 How we do it
21 The value we create
24 Key performance indicators
28 Financial review
34 Operating review
34 Products
38 Trade
40 Resources
Sustainability letter
5
Our Sustainability Approach
10 Sustainability performance
2
Consolidated statement
of comprehensive income
3
Consolidated statement
33 Responsible Business Practices
of financial position
36 Directors' Report
38 Chairman's introduction
40 Board of Directors
43 Direct reports to the CEO
44 Board Leadership and
Company Purpose
63 Division of Responsibilities
65 Composition, Succession
and Evaluation
4
Consolidated statement
of changes in equity
6 Consolidated statement of cash flows
7 Notes to the financial statements
49 Intertek Group plc –
Company balance sheet
50 Intertek Group plc –
Company statement of changes in equity
51 Notes to the Company
financial statements
43 Principal risks and uncertainties
67 Nomination Committee report
49 TCFD statement
58 Section 172 statement
71 Audit Committee report
54 Independent Auditors’ Report
78 Remuneration Committee report
61 Glossary –
64 Group non-financial information
104 Other statutory information
Alternative performance measures
statement
108 Statement of Directors’
64 Shareholders and corporate information
responsibilities
Visit our website for more information
intertek.com
Book one
Book two
Book three
1
Book one
Book two
Book three
Science-based customer
excellence is our differentiator.
It enables us to be at the
forefront of the world’s most
critical and exciting industries,
doing amazing things to help
businesses everywhere
become ever better.
It’s the science behind what we do that drives
the customer excellence advantage. The
intelligence and expertise of our network of
Total Quality Assurance Experts, combined
with a drive for continuous improvement,
and data-driven innovation, gives our
customers the solutions they need to
power ahead with confidence.
As proven industry experts, it’s not just
what we do that makes us unique, it’s how
we do it. We are a force for good bringing
quality, safety and sustainability to life in
more than 100 countries, creating value
for all our stakeholders now and into
the future.
See how
we're making
the world
ever better
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Contents
2
Intertek Group plc Annual Report & Accounts 2022
Book one
Book two
Book three
Strategic Report
Sustainability Report
Financial Report
making the world ever better by
advancing
artificial sight
Medical device companies face multiple
challenges as they work to get safe and effective
products to market. From contamination and
stability issues to failure resolution and quality
control. Our medical device testing experts help
resolve these issues through scientific solutions
based on more than 30 years of experience
in materials science and mechanical and
chemical testing.
Our commitment to Science-based Customer
Excellence accelerates our customers’ product
development and enables smoother regulatory
submissions and approvals. We support
customers through the entire product lifecycle –
from clinical research, product development and
regulatory submission, through to production.
It’s an approach that’s tangibly making the
world a better and a safer place.
Ensuring the safety of an
innovative visual implant
The recent Visual Prosthesis initiative we
supported in the US is the culmination of decades
of research dedicated to providing artificial sight
to blind people.
Our Medical Device team in Massachusetts
was engaged to carry out the regulatory testing
needed to demonstrate the device’s safety,
so we conducted a design review of the implant
and applicator and undertook EMC safety testing
to the IEC 60601-1 standard. The prosthesis
was approved by the U.S. Food and Drug
Administration and surgically implanted in the
first participant, as clinical trials commenced.
Following the trials, and after further evaluation
and regulatory approval – which will also be
supported by Intertek – our customer will
design and test a new unit for use at
home by trial subjects.
An engagement of this length and depth is a
regular scenario for us, as many breakthrough
medical products go through various stages
of development before they get to market.
In some cases, we work with clients for many
years before final regulatory approval.
Our customer was extremely grateful for
our support, acknowledging that we enabled
them to get to an incredibly exciting and
important point, not just for the field of
biomedical engineering but also for people
with blindness around the world.
You'll be
amazed where
you find Intertek
Find out more about
our medical device
testing expertise
Book oneBook twoBook three 3
fuelling
innovation
in aviation
You'll be
amazed where
you find Intertek
Intertek Caleb Brett is a global leader in testing
and inspecting petroleum, chemical and biofuel
cargoes. Across nearly 400 sites worldwide, we
deliver 24/7 independent quantity and quality
inspection and laboratory testing services.
Our expertise in scientific and analytical
assessment supports the entire supply chain for
biodiesel, ethanol, biomass and other biofuels,
providing quality and safety solutions to a
wide range of industries. Drawing on our
bedrock of Science-based Customer Excellence,
our inspectors and chemists deliver data-driven
insight, innovation and continuous improvement
to refiners, producers and blenders, distributors,
consumers and research institutes.
important role in the quality control of the fuel
used in the first sustainable (bio) jet fuel flights.
Ground-breaking sustainable jet fuel
For more than a decade, we have been helping
SkyNRG develop a robust Total Quality Assurance
programme to provide their customers with
sustainable jet fuel that’s just as reliable and
safe as traditional petroleum Jet A1 fuel.
In the aviation industry, building confidence and
assuring the highest possible safety and quality
is essential for a new commodity like sustainable
jet fuel. We were delighted to play such an
Following recent amendments to the ASTM
D-7566 specification for describing aviation
turbine fuels and ensuring the quality of
synthetic blending components, regular flights
using sustainable jet fuel are now possible.
The testing and inspection services we deliver
across the world now include testing the 100%
pure sustainable (bio) jet fuel component, along
with the final 50% blend with petroleum jet fuel
used for commercial flights.
You'll be
amazed where
you find Intertek
Find out more about
our fuel quality and
inspection services
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 4
Intertek Group plc Annual Report & Accounts 2022
Book one
Book two
Book three
Strategic Report
Sustainability Report
Financial Report
using our scientific
expertise
to protect
biodiversity
Intertek is an industry leader in the Assurance,
Testing, Inspection and Certification sector for
agriculture, propelled by our unmatched dedication
to Science-based Customer Excellence to help
shape an ever better world. Intertek AgriWorld
offers clients a broad selection of services in
environmental analysis and monitoring, from
waste water, agricultural water, soils, noise, air
quality, through to emissions into the atmosphere,
as well as food and water for human consumption.
Protecting Peru’s aquaculture
and marine macroalgae
It’s because our clients trust us to ensure quality,
safety and sustainability across their entire
value chain that, for the third time since 2016,
Intertek Peru has been awarded the Programme
for Surveillance and Control of Fishing and
Aquaculture Activities at National Scope.
This involves working with Peru’s Ministry of
Production and National Fisheries on surveillance
and control related to aquaculture activities, as
well as supervising the extraction, collection,
transport and processing of marine macroalgae.
These are very important hydro-biological
resources with high ecological, economic and
social value, acting as a habitat and refuge for
many marine species as well as absorbing CO2
and producing oxygen. For this reason, Peruvian
legislation allows only the collection of naturally
stranded macroalgae to avoid over-exploitation.
There are more than 200 varieties of species
of macroalgae in Peru, used for purposes such
as protein food, and as gelling, thickening and
stabilising compounds for the pharmaceutical,
wine and textile industries.
Collection, under Intertek’s supervision,
represents a vital economic activity, especially
in the southern part of Peru where large areas
of macroalgae directly generate employment.
We are proud to operate a surveillance
programme that protects biodiversity by
eliminating illegal fishing as well as the
illegal extraction of macroalgae. It’s delivering
support to the environment and protecting
the ecosystem of macroalgae, both in Peru
and across the world.
You'll be
amazed where
you find Intertek
Find out more
about our
Agri Services
Book oneBook twoBook threeContents 5
Contents
Chief Executive Officer’s letter
The Science-based
Customer Excellence
Advantage
Technical
Expertise
Superior Total Quality
Assurance IP powered by
industry-leading processes
and technology
Science-based
Customer
Excellence
André Lacroix
Chief Executive Officer
More on page 6
Data-driven
Innovation
Data science advantage to
give our clients the best
insights on how to make their
businesses stronger
Continuous
Improvement
Science-based continuous
improvement of solutions
based on rigorous
research, knowledge and
understanding
Book threeBook twoBook oneStrategic ReportFinancial ReportSustainability ReportIntertek Group plc Annual Report & Accounts 2022Contents Intertek at its core
is a network of
science-based, highly
technically skilled
individuals and teams
who are dedicated to
helping businesses
become ever better.”
6
• The third is about science-based innovation.
We continuously apply superior data-driven
insights when creating and delivering end-to-end
solutions for our clients. As a result, we can draw
on our strong data-science advantage that ensures
we deliver the best and most effective insights into
how and where to improve their businesses.
Our Science-based Customer Excellence approach
is enabling us to build long-lasting and ever-closer
relationships with our clients. This gives our clients
the ATIC advantage that empowers them to make
their businesses ever stronger, ever more resilient
and ever more sustainable.
Ultimately, this is what continues to make us a
quality leader in the highly attractive $250-billion
global Quality Assurance market.
Global ATIC market
Our unique offering means we are well-placed
to take advantage of the huge growth
opportunities in the global ATIC market.
$250bn
Global ATIC market
Untapped potential
$200bn
Currently in-house
$50bn
Currently
outsourced
The Science-based
Customer Excellence
Advantage
At Intertek we work together to make the world a
better and safer place for everybody, delivering on
our vision of being the world’s most trusted partner
for Quality Assurance.
What our people do every day is amazing, delivering
on our purpose of bringing quality, safety and
sustainability to life, not just for our 400,000+ clients
in more than 100 countries worldwide, but also for
their many millions of customers and stakeholders.
During the year, we continued to innovate and
provide customers with the mission-critical solutions
they need through our unique Assurance, Testing,
Inspection and Certification ('ATIC') service offering.
As a world leading Total Quality Assurance ('TQA')
provider, we enable global and local businesses to
overcome the complex quality, safety and sustainability
challenges they face to give them the peace of mind
they need to focus on their growth agenda.
Our superior customer service is based on our
‘Science-based Customer Excellence’ approach
that we have built up over many years, based on
three essential components:
• The first is about our science-based technical
expertise. It’s our industry-leading processes and
technology that ultimately enable us to build the
world’s best intellectual property ('IP') for delivering
superior customer-focused TQA solutions.
• The second is about science-based
continuous improvement. Our commitment
to the principles of science-based continuous
improvement means we always go back to the
data. We do this to ensure the solutions we offer
are invariably based on the best possible research,
knowledge and understanding.
Results in 2022
I would like to recognise all my colleagues for their
commitment, passion and agility as 2022 marks
another year of consistent value delivery with
revenue and earnings in-line with expectations,
demonstrating the strengths of our differentiated
TQA value proposition, our Science-based Customer
Excellence giving our clients the ATIC advantage,
our unique end-to-end performance management
approach and our high-quality growth earnings model.
We have a group of excellent businesses globally
which performed well across 2022. In China,
however, the Covid-related lock-down restrictions
and consequent revenue headwinds faced in
March-June did have an impact on our performance,
as did the high level of Covid-related sickness we
experienced in November-December, all of which
have also impacted Group margins.
We have delivered a robust performance in 2022 with:
• Group revenue up 8% at constant rates and nearly
15% at actual rates
• LFL revenue growth of 4.9% at constant rates
• Adjusted operating profit up 4% at constant rates
and nearly 10% at actual rates
• Robust adjusted operating margin of 16.3%
• Adjusted diluted EPS growth of 4.6% at constant
rates and 10.6% at actual rates
• Statutory operating profit after SDI up 4.4% at
actual rates
• Progress on ROIC at constant rates
• Unchanged full year dividend at 105.8p
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeChief Executive Officer’s letter ContinuedContents Post Covid-19, the Quality Assurance market will
grow faster as the demand for Quality Assurance
solutions is expanding across all our business lines
given the increasing stakeholder expectations in
quality, safety and sustainability. Moving forward,
we expect the attractive structural growth drivers
in our industry to be augmented by an expansion in
ATIC customers, a stronger focus by corporations on
safer supply chains, greater corporate investments
in innovation, a step change in sustainability
management and reporting with independently
verified disclosures, and significant growth
opportunities in the World of Energy.
We are entering 2023 with confidence given the
re-opening of China, which has been operating with
normal staffing levels since the beginning of the year,
the increased demand for our ATIC solutions, the
strengths of our portfolio, our strong pricing power,
our productivity and cost initiatives, as well as our
cash flow discipline. We expect the Group will deliver
mid-single digit LFL revenue growth at constant
currency, with margin progression year-on-year, and
a strong free cash flow performance.
We operate a differentiated, high-quality growth
business with excellent fundamentals and intrinsic
defensive characteristics, giving our customers the
Intertek Science-based Total Quality Assurance
advantage to strengthen their businesses. Our
leading ATIC solutions are mission-critical for the
world to operate safely and the growth in our
end-markets is accelerating. We operate a high-
performance earnings and cash compounder model
which has generated 8% annual Total Shareholder
Returns since 2012. We are well-positioned to deliver
sustainable growth and value for all stakeholders in
the short, medium and long term.
7
Financial highlights
• Revenue of £3,193m; +8.2% at constant
rates; +14.6% at actual rates
• LFL revenue growth of 4.9% at constant
rates: Products +3.9%; Trade +5.6%;
Resources +7.9%
• Outside China LFL revenue grew 6.5% at
constant rates: Products 5.5%, Trade 7%,
Resources 8.5%
• Recent acquisitions JLA, SAI and CEA
performing well, contributing £153.0m of
margin accretive revenue in 2022
• Adjusted operating profit of £520m, up 3.8%
at constant rates and up 9.7% at actual rates
• Robust adjusted operating margin of 16.3%,
70 bps lower at constant and actual rates;
H2 margin of 17.8%
• Adjusted diluted EPS of 211.1p: up 4.6% at
constant rates and up 10.6% at actual rates
• Adjusted free cash flow of £386m and
a strong balance sheet with 1.1x net debt
to EBITDA
• ROIC of 18.0%, up year-on-year by 20bps at
constant rates and down 20bps at actual rates
• Sustainable returns to shareholders with full
year dividend of 105.8p and dividend cover
back to 2.0
• Cost reduction programme (£27m in SDIs)
to streamline operations and deliver annual
savings of £15m
• 2023 outlook: Mid-single digit LFL revenue
growth, margin progression and strong free
cash flow
£3,193m
Revenue
(2021: £2,786m)
£3,067m
Like-for-like revenue1
(2021: £2,761m)
£386m
Adjusted free cash flow1, 2
(2021: £402m)
£452m
Statutory operating profit
(2021: £433m)
16.3%
Adjusted operating margin1,2
(2021: 17.0%)
105.8p
Dividend per share3
(2021: 105.8p)
178.4p
Statutory diluted EPS
(2021: 177.9p)
£520m
Adjusted operating profit1,2
(2021: £474m)
18.0%
Return on Invested Capital1
(2021: 18.2%)
14.2%
Statutory operating margin
(2021: 15.5%)
211.1p
Adjusted diluted EPS1,2
(2021: 190.8p)
1. Definitions of the alternative performance measures, metrics
and constant rates can be found in Book three, page 61.
2. Adjusted operating profit, adjusted operating profit margin, adjusted
diluted earnings per share (‘EPS’) and adjusted free cash flow are
non-GAAP measures. Adjusted measures are stated before
Separately Disclosed Items, which are described in note 3 to the
financial statements in Book three, page 11. Reconciliations between
statutory and adjusted measures, as well as return on invested capital
and cash conversion, are shown in the Financial review.
3. Dividend per share for 2022 is based on the interim dividend paid
of 34.2p (2021: 34.2p) plus the proposed final dividend of 71.6p
(2021: 71.6p).
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeChief Executive Officer’s letter ContinuedContents 8
We operate a differentiated,
high-quality growth business
with excellent fundamentals
and intrinsic defensive
characteristics, giving our
customers the Intertek
Science-based Total Quality
Assurance advantage to
strengthen their businesses."
Exciting growth
opportunities ahead
The Quality Assurance market is growing
faster post Covid-19 as the demand for Quality
Assurance solutions is expanding across all our
business lines given the growing stakeholder
expectations in quality, safety and sustainability.
This is making the case for our unique risk-based
Quality Assurance solutions stronger.
Moving forward, we expect the attractive
structural growth drivers in our industry to be
augmented by an increase in ATIC customers,
a stronger focus by corporations on safer
supply chains, greater corporate investments
in innovation, a step change in sustainability
management and reporting with independently
verified disclosures, and exciting growth
opportunities in the World of Energy.
Strategic highlights
Sustainability highlights
We are purpose-led and passionate about
making the world a better place, bringing
quality, safety and sustainability to life.
Continuous progress on Health and Safety
with a reduction of 7bps in our Total
Recordable Incident Rate vs 2021.
We provide a superior customer service
with our ATIC solutions, and Science-based
Customer Excellence is our competitive
advantage.
Stakeholders’ expectations in a post
Covid-19 world in terms of quality, safety
and sustainability are higher, making the
case for our risk-based Quality Assurance
solutions stronger.
Since 2015, we have used the Net Promoter
Score (‘NPS’) process to listen to our
customers and conduct on average 5,400
interviews each month which has enabled
us to improve our customer service over the
years consistently.
We are driving environmental performance
across our operations through new science-
based reduction targets to 2030 as well as
site-by-site action plans. Our rigorous
monthly performance management of our net
zero plans against emission reduction targets
has delivered total CO2e emissions (market-
based) reductions of 7.8% vs 2021.
Our approach to value creation is based on
the compounding effect of margin-accretive
revenue growth, strong cash generation and
disciplined investment in growth. This has
delivered an 8% annual to Total Shareholder
Return since 2012.
We recognise the importance of employee
engagement in driving sustainable
performance for all stakeholders, and we
measure employee engagement against our
Intertek ATIC Engagement Index. Our 2022
score was 80%.
We are well positioned to continue to
deliver sustainable growth and value for
all our stakeholders.
Our voluntary permanent employee
turnover was at a low rate of 14%.
Read more in our Sustainability Report, Book two
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeChief Executive Officer’s letter ContinuedContents 9
Sustainability at the heart
of everything we do
Sustainability is the movement of our time and is
central to everything we do at Intertek, anchored in
our strategy, our Purpose, our Vision and our Values.
Sustainability is important to all stakeholders in
society who are consistently demanding faster
progress and greater transparency in sustainability
reporting. Companies everywhere therefore
continuously need to upgrade and reinvent how
they manage their sustainability agenda, particularly
with regard to how they disclose their performance.
This is why, under our global TSA programme, we
provide our clients with proven independent, systemic
and end-to-end assurance on all aspects of their
sustainability strategies, activities and operations.
The TSA programme comprises three elements:
• Intertek Operational Sustainability Solutions
• Intertek ESG Assurance
• Intertek Corporate Sustainability Certification
World of Energy
Powering the future
Our World of Energy business brings
together more than 135 years of energy
industry expertise, proactive innovations
and broad-based specialist services.
Energy companies are facing enormous
challenges as the world transitions to a
sustainable future. These challenges are
compounded by the need to ensure operational
efficiency, maximise quality, minimise risks and
costs and improve safety. More than ever,
companies are seeking experts to help them
proactively prepare for and overcome challenges,
seize opportunities, maintain budgets and
project timelines. Intertek World of Energy
supports these companies as they pursue
decarbonisation targets and advance to
energy transition.
With energy in our DNA, Intertek is an
unwavering partner to the energy industry –
from traditional sectors such as oil & gas,
petrochemical, LNG and fossil-fuels to wind,
solar, hydro, energy storage, synfuels, biofuels,
carbon capture and hydrogen. That’s why we
are a trusted energy partner – with the vision,
experience, scientific know-how, tools and
processes to deliver peace of mind through
adaptive and systemic end-to-end Total
Quality Assurance solutions.
Our extensive network of energy industry
experts consistently delivers the broad
portfolio of proactive and unique solutions
our clients need to help them navigate the
shift to sustainable power and join the
energy revolution.
intertek.com/worldofenergy
Total Sustainability Assurance
TSA is a global programme that leverages our footprint in over 100 countries and covers all
industries. We have built a team of sustainability experts in every major region, who can help
with both a global and local perspective. (Read more about how we help our clients meet their
sustainability goals in the Sustainability Report, Book two, pages 17-23)
Intertek Operational
Sustainability Solutions
enable companies to
understand, achieve and
validate their existing and
emerging sustainability goals
for their products, assets,
facilities, systems, processes
and the environment.
Providing independent
verification of sustainability
disclosures and reporting,
Intertek ESG Assurance
enables companies to identify
areas of risk and impact,
define their sustainability
strategies and prepare
ESG reports.
Intertek Corporate
Sustainability Certification
covers topics from Quality and
Safety to the Environment and
Communication & Disclosure,
enabling clients to verify
their corporate sustainability
performance across the 10
most essential corporate
sustainability subject areas.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeChief Executive Officer’s letter ContinuedContents 10
Our 5x5 strategy
Implementing our 5x5 differentiated
strategy for growth
Intertek has a proven track record of delivering
sustainable value creation for all stakeholders
which is testament to the strength of our 5x5
differentiated strategy for growth and our
commitment to the Kaizen principles of
continuous improvement.
Our goals
Our 5x5 differentiated strategy is
designed to help us achieve five goals:
1
2
3
4
5
Fully engaged employees working
in a safe environment;
Superior customer services across all
our Assurance, Testing, Inspection and
Certification solutions;
Margin-accretive revenue growth based
on GDP+ organic growth;
Strong cash conversion from our
operations; and
An accretive, disciplined capital-
allocation policy.
Sustainability Excellence
at Intertek
For ourselves at Intertek, we focus on our 10 highly
demanding TSA sustainability standards which are
truly end-to-end and systemic. You can see our
sustainability highlights regarding our progress
on Health and Safety, environmental performance,
customer and employee engagement and turnover
on page 8, and read in detail about our sustainability
results in our 2022 Sustainability Report, Book two.
Read more in our Sustainability Report
Sustainability credentials
Intertek has been included
in the FTSE4Good Index
for the sixth year running.
In 2022, Intertek received
a rating of ‘AAA’ in the MSCI
ESG Ratings assessment.
Intertek is an accredited
Living Wage Employer
in the UK.
2050
Continuous focus on
reducing our direct GHG
emissions and targeting
net zero emissions by 2050.
Proud member of
the Valuable 500.
Our strategic priorities
Our strategic enablers
Our strategic priorities – through which
we will sustain and further extend our
global leadership position – are:
The fact that we have consistently
and demonstrably delivered against
all these priorities reflects the power
of our five strategic enablers:
Differentiated
brand proposition
positioning us as
leader of the global
TQA market
Superior
customer service
making us the most
trusted and respected
TQA partner
Living our
customer-centric
culture
Disciplined
performance
management
Effective sales
strategy
continuously improving
our margin-accretive
revenue growth
Growth and
margin-accretive
portfolio
prioritising investments
with high-growth and
high-margin prospects
Superior
technology
Energising
our people
Operational
excellence
our ‘Ever Better’
approach continuously
improves efficiency
and productivity
Delivering
sustainable
results
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeChief Executive Officer’s letter ContinuedContents 11
5,400
customer interviews every month
through our NPS programme
460
tonnes of CO2 eliminated from
our analysis of gold
Another innovative new launch is designed to help
retailers and brands of soft goods, hard goods and
personal protective equipment to understand and
comply with the different regulations in force in
different markets across the world. This is Global
Market Access, a one-stop digital knowledge portal,
developed with the aim of increasing compliance for
improved consumer safety and protecting corporate
reputations in today’s interconnected world.
Among many other initiatives and highlights, we also
celebrated the first anniversary of our innovative
Minerals Global Centre of Excellence in Perth,
Australia. This pioneering facility aims to help mining
and exploration companies produce the future-
focused commodities that are becoming increasingly
essential in enabling a more sustainable world.
One of the world’s largest and most advanced
minerals laboratories, the Centre’s achievements
to date are already impressive. These include
processing more than 3 million samples, including
1 million PhotonAssay™ samples to facilitate the
faster and more environmentally friendly analysis
of gold. This work alone has eliminated 625 tonnes
of hazardous lead waste and reduced C02 emissions
by 460 tonnes. I applaud the team at the site for
its work on helping customers achieve greater
innovation, efficiency, sustainability and safety.
Other enhancements to existing solutions
included the creation of new and improved
features for our Inlight solution, which enables
organisations to manage increasingly complex
risks in the supply chain.
Investing in growth with
customer-led innovation
True to our pioneering spirit, throughout the year, we
continued to innovate to meet the emerging needs
of our customers.
We are constantly learning from our customers,
using their extensive feedback to help us deliver
ever better solutions to their evolving requirements.
We believe that successful innovation starts with
investing in the insight advantage, which means
having a deep understanding of what our customers
need and want. Through our NPS programme, we
carry out 5,400 customer interviews every month.
With the ability to access world-class customer
intelligence site-by-site from anywhere across our
global network, we have a continuous stream of data
that enables us to build on our insights and use this
to develop new ATIC solutions.
In September, for example, we launched a new
certification mark that aims to give consumers
transparency regarding the claims made by the
manufacturers and marketers of vegan foods.
This is a timely introduction given the exponential
global growth in the number of consumers who are
exploring a plant-based diet as part of a healthier
lifestyle with a reduced environmental impact.
Further examples of sustainability-related
innovation include the launch of Intertek EcoCheck,
a tourism solution that audits management systems
and provides a carbon footprint calculation. This
enables our clients to demonstrate tangible action
to reach their carbon targets.
ToxClear, meanwhile, supports the development
of more sustainable supply chains in the fashion
industry by enabling brands and suppliers to achieve
transparency and traceability on the chemicals used
in manufacturing.
Read more about our Minerals Global Centre of Excellence on page 20
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeChief Executive Officer’s letter ContinuedContents 12
Seizing new ATIC growth
opportunities through
strategic acquisitions
We are also targeting inorganic investments with
attractive M&A opportunities that strengthen our
ATIC portfolio in high-margin, high-growth areas.
Our acquisition of Clean Energy Associates (‘CEA’),
a market-leading provider of Quality Assurance
('QA'), supply-chain traceability and technical services
to the fast-growing solar energy sector, illustrates
this clearly. The long-term, structural trend towards
decarbonisation, energy sustainability and security
means the solar energy sector is on track to be the
world’s largest source of renewable energy-
generation by 2030. The CEA acquisition empowers
the expansion of our sustainability service offering
in the fast-growing QA market for the sector.
Two of our previous acquisitions – of SAI Global
Assurance and JLA Brasil Laboratório de Alimentos
S.A. – have also both proven during the year to be
excellent examples of complementary businesses.
Collectively, these three businesses, all recently
integrated into the Group, delivered £153.0m of
margin accretive revenue during the financial year.
In action
Supporting the drive for clean energy through new acquisitions
Clean Energy Associates ('CEA') is a
market-leading provider of Quality
Assurance, supply chain traceability
and technical services to the fast-growing
solar energy and energy storage sectors.
As the energy transition accelerates and
companies re-invent the way they manage their
sustainability agendas, the growth opportunities
within the World of Energy are multiplying.
With solar power expected to become the
largest source of renewable energy globally, our
acquisition of CEA presents a compelling strategic
fit and an opportunity to expand Intertek’s service
offering within the World of Energy. CEA will also
benefit from Intertek’s global network and
customer base, enabling us to bring our Total
Quality Assurance solutions for solar photovoltaic
('PV') and energy storage products and
installations into new geographies.
Headquartered in the US, CEA serves as a trusted
partner to some of the world’s leading solar project
developers, owners and financiers, providing a
range of services across the value chain.
These services include in-line production
monitoring and Quality Assurance, supply chain
management and traceability, as well as technical
support to solar PV and energy storage projects.
Combined with Intertek’s comprehensive existing
solar energy service offerings in product testing and
certification and in-field inspections, this acquisition
creates a truly end-to-end service offering to
support customers on their decarbonisation and
energy sustainability journeys.
For more information visit: cea3.com
People at the heart of our
purpose-led culture
Across the organisation, our people are excited
about the opportunity we have to deliver on our core
purpose of bringing quality, safety and sustainability
to life. This attitude and passion is at the heart of
our culture, and our determination to be the agents
of positive change around the world is evident in
everything we do.
We have a highly disciplined approach to performance
management, and this powers our operational
excellence and continuous improvement. Our
commitment to excellence involves the constant
measurement of our progress against a range of
operational metrics, using data intelligence to
continuously gauge and understand our customer-
service levels and turnaround times.
This approach, along with our unwavering focus on
quality at every site, is crucial to our ability to deliver
constant improvement, underpinning our operational
and Health and Safety excellence to ensure that our
customers always receive a superior service.
Ultimately, of course, our ability to do this comes
down to the energy and commitment of our 43,500
people across the world. These science-based
individuals and teams, all highly technically skilled,
constantly strive to go beyond what our clients
expect of them.
I believe that our performance over the last
three years of extreme disruption underlines the
importance of our people’s unwavering commitment
to giving our clients the peace of mind they seek, in
turn giving us the right to call Intertek ‘an amazing
force for good’ in the world.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeChief Executive Officer’s letter ContinuedContents Science-based Customer
Excellence for an ever
better world
We are a high-quality growth business delivering value
for all stakeholders, with excellent fundamentals in
customer service, ATIC demand, margin management,
capital allocation discipline, and operating culture.
We are well positioned to continue to deliver
sustainable growth and value for all our stakeholders.
Intertek’s approach to value creation is based
on the compounding effect, year after year, of
margin-accretive revenue growth, strong cash
generation and disciplined investment in growth.
This approach has delivered an 8% annual Total
Shareholder Return since 2012.
We provide a superior customer service with our
ATIC solutions, and Science-based Customer
Excellence – in terms of technical expertise,
continuous improvement and innovation – is our
competitive advantage. We measure our customer
service with circa 5,400 interviews a month and
work continuously at becoming ever better with
both process improvements and industry-leading
innovations. That’s why we operate with a very
high customer retention.
From an ATIC demand standpoint, stakeholders’
expectations in a post Covid-19 world in terms of
quality, safety and sustainability are higher, making
the case for our risk-based Quality Assurance
solutions stronger. That’s why we expect the higher
demand for our ATIC solutions to drive a higher
organic growth post Covid-19.
13
High quality earnings model
Our high-margin, cash-generative earnings model is at the core of what makes us successful. It is based
on the delivery of our unique TQA value proposition. The profitable delivery of ATIC services to customers
operating in the structurally attractive Products, Trade and Resources sectors is dependent on our
capital-light business model and entrepreneurial and Customer 1st culture, which also enables us to
respond quickly to new growth opportunities.
To maximise returns, we continue to invest in high-growth, high-margin areas and maintain a disciplined
approach to capital allocation.
GDP+ organic
revenue growth
in real terms
>
>
Investments in
high-growth and
high-margin
sectors
Intertek
Virtuous
Economics
Margin-accretive
revenue growth
>
>
Disciplined
capital allocation
>
Strong free
cash flow
Margin-accretive revenue growth is central to the
way we deliver value. It starts with our portfolio
that targets organic and inorganic investments
in attractive growth and margin sectors. We
have established over the years a continuous
improvement performance approach at every
layer of the organisation to control costs and drive
productivity improvement. That’s why we expect
margin progress moving forward.
Our strong focus on cash management has stepped
up our free cash flow performance over the years
enabling us to invest in growth, reward our
shareholders with a progressive dividend policy
targeting a 50% pay-out and operate with a strong
balance sheet giving us the firepower to invest in
M&A. This is what we mean by disciplined capital
allocation.
At Intertek, we are purpose-led and we are all
passionate about making the world a better place,
bringing quality, safety and sustainability to life.
We are a growth-oriented Company attracting,
developing and retaining the best talents in
the industry.
We operate a differentiated, high-energy, people-
centric culture focussed on delivering sustainable
value for all stakeholders: Science-based Customer
Excellence for an ever better world.
André Lacroix
Chief Executive Officer
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeChief Executive Officer’s letter ContinuedContents
14
Book one
Book two
Book three
Our business model
how we apply our
skills, scientific
knowledge,
resources and
relationships
to create value
1. Who we are
We are passionate about our purpose and
committed to being ever better. Our people are
guided by science, and sustainability is central
to everything we do.
More on page 15
2. What we do
Intertek’s unrivalled Total Quality Assurance is
delivered consistently with precision, pace and
passion. Science-based Customer Excellence is
what makes us different.
More on page 16
3. Our sectors
We concentrate our capabilities into three
attractive growth and high-margin sectors:
Products, Trade and Resources.
More on page 18
4. How we do it
The industry-leading solutions we provide are
delivered with an unwavering commitment to our
customers and by investing in our global network.
More on page 19
5. The value we create
We are a force for good in the world, and our
solutions create meaningful and sustainable
long-term value for a broad range of stakeholders.
More on page 21
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 15
Our Values
• We are a global family
that values diversity.
• We always do the right
thing, with precision,
pace and passion.
• We trust each other and
have fun winning together.
• We own and shape
our future.
• We create sustainable
growth. For all.
Ever better
As a company we are committed to becoming
ever better in everything we do. That means
more than simply seeking ways to constantly
improve our operations for enhanced efficiency
and effectiveness. It means investing in our
Science-based Customer Excellence approach to
provide superior services, enabling our 400,000+
clients to become ever better too.
Our people, culture and values
Our core strength is, and always will be, our people.
We are guided by science, and it’s the way our
colleagues combine passion and innovation with
customer commitment that sets us apart.
Our decentralised operating culture is built around
strong values. These values are inspirational and help
us to drive sustainable growth for all. They guide our
behaviours every single day, underpinning the way
we work, guiding decision making and connecting
colleagues across the world.
Sustainability is central to everything we do and we
demonstrate our commitment and passion to help
our clients make a difference, as well as bettering
ourselves every day.
More in Book two, page 10.
Who
we are
1
We are passionate about our
purpose and 'Doing Business the
Right Way'. We strive to make the
world a better, safer and more
sustainable place for all, now
and for future generations.
As the world changes, supply chains are
rapidly growing in size and complexity, bringing
unprecedented levels of risk. As a result, it can
become more difficult for businesses to operate
safely and sustainably while delivering quality
products and services. In these challenging times,
companies need a trusted partner, which is why we
provide our clients with a unique risk-based approach
to Quality Assurance. We call this Total Quality
Assurance ('TQA') – and only Intertek offers it.
Our Purpose
Bringing quality, safety and
sustainability to life.
Our Vision
To be the world’s most trusted
partner for Quality Assurance.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents 16
What
we do2
We bring our clients the benefits
of our unique risk-based solution:
Total Quality Assurance
For more than 130 years, Intertek has been
innovating to mitigate risk and bring quality and
safety to organisations. From our beginnings,
certifying grain cargoes and then testing and
ensuring the safety of Thomas Edison's products,
we have become a global force for good: an industry
leader in quality, safety and sustainability.
The work we do today covers everything from
testing toys to inspecting power stations, from
certifying vaccines to providing end-to-end Quality
Assurance across every aspect of an organisation’s
operations and supply chain. Our innovation-led,
end-to-end Total Quality Assurance (‘TQA’) value
proposition supports our clients 24/7, providing a
fully integrated portfolio of Assurance, Testing,
Inspection and Certification (‘ATIC’) services
that delivers complete peace of mind across
all products, services and operating systems.
But the ATIC solutions we offer go beyond the
quality and safety of a corporation’s physical
components, products and assets. They go to
the heart of the reliability of their operating
processes and quality management. We call this
TQA because it enables our clients to mitigate
risk at every stage of their operations.
Our ATIC services
Assurance
Enabling our customers to identify and
mitigate intrinsic risk in their operations,
their supply and distribution chains and
quality management systems.
Testing
Evaluating how our customers’
products and services meet and
exceed quality, safety, sustainability
and performance standards.
Inspection
Validating the specifications, value and
safety of our customers’ raw materials,
products and assets.
Certification
Formally confirming that our customers’
products and services meet all trusted
external and internal standards.
Assurance goes beyond testing, inspection
and certification to look at the underlying
elements that make a company and its
products successful. Intertek’s assurance
solutions provide total peace of mind to
our clients that their operating procedures,
systems and people are functioning
properly to provide competitive advantage.
Our extensive auditing, performance
benchmarking and supply chain services
provide insight into every aspect of a
company's operations, enabling informed
business decisions. Our training services
ensure workforce competencies are
current and relevant. Our experts around
the globe bring their knowledge to clients
on assessing overall performance, the
quality and productivity of laboratories,
identifying and mitigating risks,
streamlining manufacturing processes
and supply chains, and so much more.
Intertek’s testing services support
the quality, performance, regulatory
compliance, safety, benchmarking,
evaluation, validation, analysis, and other
requirements for products, components,
raw materials, sites, and facilities.
Our field and in-house laboratory testing
services provide the data our clients need
to optimise the production process and
get products to market quickly and
economically.
Our experts and global resources are
equipped to meet testing, timelines and
product needs. As regulations change and
technology is created or innovated, our
knowledge and industry expertise ensures
products and businesses are prepared to
meet evolving demands.
Independent third-party inspections
help our clients around the world
protect their financial, branding and legal
interests throughout the entire supply
chain. We offer inspection services to
manufacturers, retailers, traders, plant
operators, governments and other buyers
and sellers of materials and products.
Inspections help minimise the risk of
defective products by ensuring they meet
both customer standards and industry and
government regulations. This serves to
protect business interests, help manage
risk and ensure quality products are
manufactured and delivered to their final
destination at the correct specifications.
Our experienced inspectors help identify
products and shipments which may
contain non-standard or non-compliant
components and materials. We also
support the life management of facilities
such as power plants and oil refineries.
Intertek maintains extensive global
accreditations and is recognised for
our testing and certification services.
With both international and local
proficiency, Intertek brings the
qualifications customers need to get
products in front of the right eyes.
We offer certification programmes
that achieve market entry into a variety
of global destinations, programmes
for a more eco-friendly environment
and programmes to verify social
accountability compliance for
companies and their suppliers.
We help clients showcase and maintain
products’ safety and performance. Our
leadership and expertise in regulatory
standards and certifications keep clients
ahead of changes and challenges, and our
knowledge of the process from sourcing
to market position creates efficient,
cost-effective solutions that meet best
industry practices.
intertek.com/assurance/
intertek.com/testing/
intertek.com/inspection/
intertek.com/certification/
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents
17
Most trusted partner for Quality Assurance
Our leading ATIC solutions are mission-critical for the
world to operate safely. To become the most trusted
partner for Quality Assurance our science-based
TQA Experts strive to exceed customer expectations
with end-to-end quality, safety and sustainability
solutions. This sets us apart. Our clients can rely on
the consistent quality and accuracy of our work and
the speed of our response, as we deliver rapid and
accurate feedback.
Our TQA value proposition
Intertek’s innovation-led, end-to-end
Total Quality Assurance (‘TQA’) proposition
helps organisations operate safely,
effectively and with complete peace of
mind in an increasingly complex world.
Research &
Development
Consumer
Management
Raw materials
sourcing
Customer Promise
Total Quality Assurance
expertise delivered consistently
with precision, pace and passion,
enabling our customers to
power ahead safely.
Distribution &
Retail channels
Component
suppliers
Transportation
Manufacturing
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents 18
By focusing on the three sectors of Products, Trade and
Resources, we concentrate the full power of our science-
based expertise and data-driven innovation capabilities
into these attractive growth and high-margin sectors.
£2,024m
Revenue
(63% of Group) 15.3% at actual rates, 8.5% at constant rates
£427m
Adjusted Operating Profit
(82% of Group)
£636m
Revenue
(20% of Group) 10.5% at actual rates, 5.6% at constant rates
£58m
Adjusted Operating Profit
(11% of Group)
£533m
Revenue
(17% of Group) 17.0% at actual rates, 10.3% at constant rates
£35m
Adjusted Operating Profit
(7% of Group)
Structural growth drivers
• Growth in brands, SKUs and e-commerce
• Faster innovation cycle
• Higher demand for healthy and sustainably
sourced products
• Increased focus on safety, performance
and quality
• Increased demand for smart products
• Emerging markets growing middle class
Structural growth drivers
• Population growth and social mobility
• GDP growth
• Development of regional trade
• Improvements in transport infrastructure
• Increased need for end-to-end traceability
• Increased focus on Operational Sustainability
Structural growth drivers
• Population growth and social mobility
• Investment in exploration and production,
storage and transportation
• Total Energy with diversified portfolio
• Accelerated transition to renewable energies
• Increased focus on Operational Sustainability
• Digital supply chain management
3
Our
sectors
Products
Ensuring the quality and safety of
physical components and products, and
risk assessment of operating processes
and quality management systems.
More on page 34
Trade
Protecting the value and quality of products
during custody-transfer, storage and
transportation via analytical assessment,
inspection and technical services.
More on page 38
Resources
Optimising the use of assets in oil, gas,
nuclear and power industries and minimising
risk in their supply chains through technical
inspection, asset integrity management,
analytical testing and ongoing training services.
More on page 40
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents 19
Our global network
How
we do it
4
As the world of our customers
changes, it is becoming more
complex and interconnected with
increased risks to quality, safety
and sustainability. We help them
mitigate risk and grow, building
trusted relationships, listening to
their needs to develop insight and
use our data-science advantage to
create innovative TQA solutions.
But it’s not just what we do that makes us unique,
it’s how we do it. Our expertise is guided by science
and delivered with an unwavering commitment to
our customers. Regular customer engagement is an
essential factor. Around the world, every month we
carry out 5,400 customer interviews through our Net
Promoter Score ('NPS') programme, which measures
the percentage of customers likely to recommend
our services. This is a valuable tool in helping us to
understand our customers and deliver superior
service at every Intertek site.
With 43,500 employees in our global network, based
in more than 100 countries, we keep close to our
customers and understand their challenges.
1,000+
Laboratories and offices
intertek.com
43,500
Employees
3,000
Auditors
100+
Countries
100,000+
Audits
100+
Languages
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents 20
Our science-based TQA Experts provide clients with innovative ATIC solutions
in our industry-tailored Centres of Excellence. Examples include:
Minerals Global Centre of Excellence
in Perth, Western Australia
A technology and innovation centre with
a focus on automation and sustainability
to provide our Minerals clients with faster,
safer, higher quality, and more efficient
analytical solutions. Located in Perth
Australia, a key hub for the minerals and
mining industry, this state-of-the-art lab
gives our customers access to trusted
expertise across the minerals supply chain.
intertek.com/minerals/centre-of-excellence/
Maison Centre of Excellence
in Florence, Italy
Based in Lastra a Signa, the heart of
Italy's garment manufacturing district,
Intertek's Maison Centre of Excellence
is our innovative experiential space and
adjacent world-class lab where science
meets luxury. Bringing together – virtually
or face-to-face – our industry experts,
forward-thinking luxury and fashion
brands, industry leaders, academics and
a host of textile industry participants to
collaborate and take bold new ideas and
turn them into reality.
intertek.com/maison/
Electric Vehicle ('EV') Centre of
Excellence in Milton Keynes, UK
Our EV Centre of Excellence testing facility
supports manufacturers to develop next-
generation electric propulsion systems,
from high-speed motor testing to full vehicle
validation capabilities.
Our global network of automotive testing
facilities can support manufacturers and
suppliers with a wide portfolio of bespoke
solutions and capabilities, such as engine
and hybrid testing, EV fluids, and fuel, additive
and lubricant testing.
intertek.com/automotive/electric-vehicle-
centre-of-excellence/
At Intertek we
bring Science-based
Customer Excellence
to life every day,
providing insightful,
reliable solutions
that meet the ever-
evolving needs of
our customers.”
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents
21
The value
we create
5
Our purpose is to bring quality,
safety and sustainability to life
for an ever better world. Here,
we explain how we do this for
our stakeholders.
Customers
We deliver innovative and bespoke Assurance,
Testing, Inspection and Certification solutions
to our customers for their operations and
supply chains.
Why they are important to us
Our customers are at the centre of everything
we do, and delivering the highest standards of
customer service is crucial to us becoming the
world’s most trusted TQA partner.
People
Our TQA Experts embody our culture, ensuring the
quality, safety and sustainability of products and
services used by millions around the world.
Investors
Our investor stakeholders include all groups that
have an interest in the success and sustainability
of our global business.
Why they are important to us
Our people are our most valuable asset and are
critical to our success. Customer-centric and
passionate about what they do, they deliver
sustainable value through unmatched expertise
and quality of work for our customers every day.
Why they are important to us
Delivering for our investors drives our ongoing
success, enabling us to deliver for all stakeholders
in the long term.
How we engage
We continuously engage and build our relationships
with customers, and closely analyse our NPS data.
How we engage
We create a high performance, growth-oriented and
caring culture with clear, transparent communication
and regular recognition, in which each colleague has
a personal growth plan.
How we engage
We engage with existing and potential investors
and sell-side analysts through regular trading
updates, investor conferences and roadshows
throughout the year.
How they have benefitted in 2022
• Communication, partnership and 24/7 support
• Fast development of innovative risk-based
How they have benefitted in 2022
• Consistent performance management approach,
How they have benefitted in 2022
• Stock exchange announcements, including
talent development and growth planning
financial results
solutions
• '10X Leadership' development events and '10X
• Investor roadshows, participation in investor
• Physical and virtual delivery of TQA solutions
Coaching' for executives
conferences
and Intertek Academy training
• Training and webinars from all business lines,
• Training sessions on '10X Energies'
• Extensive learning and development material
covering all industries
• Digital customer portals for improved efficiency,
productivity and visibility
• Digital directories providing our clients' customers
with access to product and supply chain information
through new LUCIE website
• Engaging employee communication channels
• Deeper support via wellbeing resource 'Kindness'
• Global implementation of Fusion HR portal
• Meetings and calls
• Annual General Meeting
• Annual Report, ESG Reporting Index
• Shareholder information on intertek.com
• Improved Investor section on intertek.com
To understand how we engage with our
stakeholders, and how the Board oversees
that engagement, please see our Section
172(1) statement on page 58.
Read more about Customers in Book two,
Read more about our People in Book two,
Visit our investor website intertek.com/investors
pages 17-23
pages 10-16
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents
22
Read more about our employees' perspective
on our culture in Book two, page 46.
Communities
We are focused on achieving a positive impact
within the communities where we operate, through
our indirect economic impacts, supporting local
causes and partnering with charities.
Government and regulators
Governments and regulators expect compliance
with all global, regional and local regulation,
responsible business practices and collaboration
on the transition to net zero.
Why they are important to us
Our people come from the communities in
which we work. It's part of our passion to
want to improve our local environment –
to be a force for good close to home.
How we engage
Our businesses regularly engage with and
contribute to our communities, and many colleagues
support local and charitable causes that reflect
the diversity of our communities and people.
How they have benefitted in 2022
• Support for and partnerships with charities
and NGOs
• Focused activities to improve local communities
and environments
• BBEB.com platform to share impactful stories
and inspire positive change in the world
Why they are important to us
‘Doing Business the Right Way’ is part of who we
are. As a responsible business, we are dedicated
to engaging positively with governments and
regulators to support our communities and comply
with global, regional and local regulations.
How we engage
We interact with trade associations and
governmental authorities to provide input into
industry and regulatory improvements in product
safety, quality and risk assurance. Interactions
with governments, governmental authorities or
regulators are reviewed by our Group Legal & Risk
functions to ensure we comply fully with all laws
and regulations.
How they have benefitted in 2022
• Our businesses’ economic and tax contribution
to governments and communities supports the
basic infrastructure of society
Read more about our Communities in Book two,
Read more about Government and Regulators in
pages 30-33
Book two, page 34
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents
The UN SDGs
Long-term impacts
The primary contribution of any business
comes through providing jobs, sustaining
livelihoods, paying taxes and supporting
social and economic development.
Beyond this, we can achieve positive and lasting
change by considering our impacts, targeting our
response and collaborating across sectors to scale
positive contributions.
As a TQA provider, we are in a strong position to
align with each of the United Nations Sustainable
Development Goals (‘UN SDGs’) through the
internal activities we carry out for our people, in
our communities and for the environment, as well
as through the sustainability services we provide
to our customers.
In 2022, we have continued to look at how the UN
SDG targets are associated with individual goals and
how our activities can help achieve these targets. We
continue to focus primarily on the six most relevant
SDGs to the Group.
More on our activities can be found in Book two,
pages 5-35
23
Good Health and Wellbeing
To ensure healthy lives and promote
wellbeing for all at all ages, we have
developed programmes that support the
good health and wellbeing of the people
within our business as well as deliver
these programmes for our customers
and communities.
Affordable and Clean Energy
Increasing our energy self-sufficiency
improves profitability and energy
security. We are assessing our operations
for energy and process efficiencies and
are investing in solar energy systems,
where appropriate, to enable energy
diversification. We are also working with
clients to deliver their renewable energy
products and services.
In action
Intertek joins flexible packaging
initiative to support the circular
economy in Europe
We are delighted to join the CEFLEX community
and help build the circular economy for plastics
and flexible packaging in Europe.
Quality Education
We are supporting the goal to ensure
inclusive and equitable quality education
and promote lifelong learning opportunities
for all, by building more relationships with
educational institutions and providing
opportunities for young people to engage
with our engineers and scientists. We
participate in programmes that ensure
equal access to all levels of education and
vocational training for the vulnerable,
including persons with disabilities,
indigenous people and children in
vulnerable situations.
Gender Equality
Improving gender balance is a priority
for us. We continue to focus on gender
diversity by attracting, developing and
retaining more talented women across
the business. We have policies, procedures
and initiatives in place to support gender
diversity throughout Intertek.
Decent Work and Economic Growth
Our daily operations provide direct, indirect
and induced employment for over 43,500
people across 100 countries. We provide
training and development opportunities
in safe, secure working environments,
graduate and apprentice opportunities,
programmes for young people experiencing
difficulties securing employment, offer
equal opportunities to all and value
diversity among our employees.
Climate Action
Climate change is one of the greatest
threats facing society, but emissions
continue to rise. Reducing our own
Greenhouse Gas emissions is a priority for
us, as well as working with our customers
to ensure they are resilient to the impacts
that a changing climate might bring.
Read more in our Environmental section
in Book two, page 24.
Read more about this in Book two, page 18
In action
Reducing the skills gap and
building employability among
the young
Both technical and vocational education and
on-the-job training suffered disruptions due
to the pandemic. We are supporting skill
development initiatives in India among
the young.
Read more about this in Book two, page 15
In action
Intertek SAI Global Assurance
supports innovative vertical
farming business
Changing weather patterns brought on by
climate change are putting added pressure on
food production in many regions of the world.
We are addressing these challenges through our
support of innovative solutions and education.
Read more about this in Book two, page 23
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOur business model ContinuedContents
24
Key performance indicators
Strong returns on
invested capital
Disciplined performance management focused on
margin-accretive revenue growth with strong cash
conversion and capital allocation to drive strong
returns on invested capital.
Definitions to the key performance indicators can be found in Book three, page 61
Financial
The Group uses a variety of key performance indicators
(‘KPIs’) to monitor performance and measure the financial
impact of the Group’s strategy. Where applicable, KPIs
are based on adjusted measures in order to provide a
meaningful and consistent year-on-year comparison. An
explanation and reconciliation of statutory to adjusted
performance measures is given on page 30. A glossary
of performance measures is provided in Book three,
page 61.
Non-financial KPIs are shown on pages 26 and 27
Key
Adjusted actual rates
2022 Adjusted
Adjusted constant rates
2021 Adjusted
Statutory actual rates
Statutory
1. Revenue, adjusted operating profit and ROIC are recalculated using 2021 exchange rates to form the basis
for Executive Director remuneration, as described in more detail in Book two, page 94.
2. Adjusted operating profit, adjusted operating margin, adjusted cash flow from operations, adjusted free
cash flow and adjusted diluted earnings per share are stated before Separately Disclosed Items, which are
described on page 30. There is no difference between adjusted and statutory revenue.
3. Dividend per share is based on the interim dividend of 34.2p (2021: 34.2p) plus the proposed final dividend
of 71.6p (2021: 71.6p).
4. 2021 ROIC has been prepared using 2022 average exchange rates for adjusted operating profit and adjusted
tax, and year-end 2022 exchange rates for invested capital. 2021 ROIC at actual rates was 18.2%.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 25
Key performance indicators Continued
Revenue1 (£m)
Like-for-like revenue (£m)
Cash flow from operations2 (£m)
Revenue growth measures how well the Group is expanding its
business and includes currency impacts.
Revenue growth, including acquisitions following their 12-month
anniversary of ownership and excluding the historical contribution of
any business disposals/closures excluding acquisitions and disposals.
Shows the ability of the Group to turn profit into cash.
14.6%
8.2%
11.1%
4.9%
3.8%
3.7%
2022
2021
3,193
2022
2,786
2021
3,067
2022
2,761
2021
704
679
722
696
Operating profit1,2 (£m)
Operating margin1,2 (%)
Return on invested capital at constant rates1,4 (%)
Measures profitability of the Group and includes currency impacts.
Measures profitability as a proportion of revenue.
Measures how effectively the Group generates
profit from its invested capital.
9.7%
3.8%
4.4%
(70bps)
(70bps)
(130bps)
(20bps)
20bps
2022
2021
452
433
520
474
2022
2021
14.2
15.5
16.3
17.0
2022
2021
Diluted earnings per share2 (pence)
Dividend per share3 (pence)
Adjusted free cash flow2 (£m)
A key measure of value creation for the Board and for shareholders.
Measures returns provided to shareholders.
Shows the ability of the Group to turn profit into cash.
10.6%
4.6%
0.3%
2022
2021
178.4
177.9
211.1
2022
190.8
2021
Flat
105.8
2022
105.8
2021
18.0
17.8
(3.9%)
386.3
401.8
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Key performance indicators Continued
Non-financial
We measure our success by
tracking both non-financial
and financial key performance
indicators that reflect our strategic
priorities. We continue to review
the sustainability areas that are
most material and relevant to
our stakeholders and have set
ourselves targets in those
areas that are aligned to our
corporate strategy:
26
Health and safety
Customer satisfaction
Environment
Total Recordable Incident Rate ('TRIR')
Recordable incidents include medical treatment
incidents, lost time incidents and fatalities per
200,000 hours worked.
Customer focus
Average number of Net Promoter Score ('NPS')
interviews carried out each month.
Why we measure it
A reduction in incidents is an important measure
of the effectiveness of our safety culture. It also
lowers rates of absenteeism and costs associated
with work-related injuries and illnesses.
Why we measure it
Customers are our priority. Since 2015, we
have used the NPS process to listen to our
customers. These insights give us a deep
understanding of what our customers need
and want, fuelling our innovations.
Operational emissions
With the adoption of our new near-term absolute
emissions reduction targets, we now measure
our environmental performance against this.
Operational emissions comprise our Scope 1,
Scope 2 and Scope 3 (Business Travel and
Employee Commuting).
Read more about our Environmental
performance in the Sustainability Report
in Book two, pages 24 to 29.
Why we measure it
We measure our carbon emissions to reduce
our impact on the environment and increase
operational efficiency. We track both location-
based and marked-based Scope 2 emissions.
Total Recordable Incident Rate
Total Recordable Incident Rate ('TRIR')
0.8
0.7
0.6
0.5
0.4
0.3
0.2
Average NPS interviews per month
2022
2021
2020
2019
5,400
6,000
6,000
7,000
Operational emissions (in tCO2e)
Operational emissions (in tCO2e)
300,000
Group Engagement index
Key financials
2019
2020
2021
2022
Employee voluntary turnover and
Women in senior management
Training completion by eligible employees
250,000
200,000
150,000
100,000
50,000
2019
2020
2021
2022
0
2019
2020
2021
2022
89
80
80
Target
TRIR of less than 0.5 per 200,000 hours worked.
Target
We will continue to aim to conduct at least
6,000 NPS interviews per month.
Target
2030: Reduce absolute Scope 1, Scope 2
and Scope 3 (Business Travel and Employee
Commuting) by 50% vs 2019 base line.
We aim to keep our voluntary permanent
turnover rate below 15% and increase our
Group Engagement Index to 90.
Target
Target
2025: We aim to increase the proportion of
We aim to achieve 100% completion of our
women in senior leadership roles to 30%.
annual compliance training by eligible employees.
Voluntary permanent employee
Gender balance
Compliance training
turnover and employee engagement
Percentage of women in senior management
Completion of annual compliance training by
Voluntary permanent leavers are employees who
roles (Leadership Team1 and their direct reports).
eligible employees2 (online or face to face,
when available) during the training window.
Why we measure it
Why we measure it
Why we measure it
Ensuring employees are engaged is essential
We promote diversity in all its forms, including
Our commitment to the highest standards of
to talent retention and we measure and monitor
gender, age, sexual orientation and disability, as
integrity and professional ethics is embedded
this closely at a global and local level through
well as having an ethnic and social make-up that
in the Group’s culture through the integrity
our voluntary turnover rate.
reflects broader society. Achieving better gender
principles set out in our Code of Ethics. Every
balance is a driver of progress.
year, to support continuing understanding in this
area, all of our people are required to complete
our comprehensive training course.
choose to leave the Group themselves. This does
not include employees on a fixed-term contract.
Intertek ATIC Engagement Index – based on the
key drivers of sustainable value creation and
which measures engagement on a monthly basis
in every operation with the following metrics:
Net Promoter Score, Customer Retention,
Quality, Voluntary Permanent Employee
Turnover and Total Recordable Incident Rate.
employees)
14%
9%
13%
14%
Employee
voluntary turnover
(% of permanent
Group
Engagement
index score
Target
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
Total Recordable Incident Rate ('TRIR')
Customer focus
Operational emissions
Recordable incidents include medical treatment
Average number of Net Promoter Score ('NPS')
With the adoption of our new near-term absolute
incidents, lost time incidents and fatalities per
interviews carried out each month.
200,000 hours worked.
emissions reduction targets, we now measure
our environmental performance against this.
Operational emissions comprise our Scope 1,
Scope 2 and Scope 3 (Business Travel and
Employee Commuting).
Why we measure it
Why we measure it
A reduction in incidents is an important measure
Customers are our priority. Since 2015, we
of the effectiveness of our safety culture. It also
have used the NPS process to listen to our
lowers rates of absenteeism and costs associated
customers. These insights give us a deep
with work-related injuries and illnesses.
understanding of what our customers need
Why we measure it
We measure our carbon emissions to reduce
our impact on the environment and increase
operational efficiency. We track both location-
based and marked-based Scope 2 emissions.
and want, fuelling our innovations.
Total Recordable Incident Rate
Total Recordable Incident Rate ('TRIR')
Average NPS interviews per month
Operational emissions (in tCO2e)
0.8
0.7
0.6
0.5
0.4
0.3
0.2
2019
2020
2021
2022
Key performance indicators Continued
Employees
Diversity and Inclusion
Compliance
27
Voluntary permanent employee
turnover and employee engagement
Voluntary permanent leavers are employees who
choose to leave the Group themselves. This does
not include employees on a fixed-term contract.
Intertek ATIC Engagement Index – based on the
key drivers of sustainable value creation and
which measures engagement on a monthly basis
in every operation with the following metrics:
Net Promoter Score, Customer Retention,
Quality, Voluntary Permanent Employee
Turnover and Total Recordable Incident Rate.
Why we measure it
Ensuring employees are engaged is essential
to talent retention and we measure and monitor
this closely at a global and local level through
our voluntary turnover rate.
Employee voluntary turnover and
Group Engagement index
Key financials
2019
2020
2021
2022
Gender balance
Percentage of women in senior management
roles (Leadership Team1 and their direct reports).
Compliance training
Completion of annual compliance training by
eligible employees2 (online or face to face,
when available) during the training window.
Read more about gender balance in
our Sustainability Report in Book two, page 13.
Read more about compliance training in
our Sustainability Report in Book two, page 34.
Why we measure it
We promote diversity in all its forms, including
gender, age, sexual orientation and disability, as
well as having an ethnic and social make-up that
reflects broader society. Achieving better gender
balance is a driver of progress.
Why we measure it
Our commitment to the highest standards of
integrity and professional ethics is embedded
in the Group’s culture through the integrity
principles set out in our Code of Ethics. Every
year, to support continuing understanding in this
area, all of our people are required to complete
our comprehensive training course.
Women in senior management
Training completion by eligible employees
2022
2021
2020
2019
79.2
20.8
77.0
23.0
76.7
23.3
79.3
20.7
2022
2021
2020
2019
97
94
96
94
Employee
voluntary turnover
(% of permanent
employees)
Group
Engagement
index score
14%
9%
13%
14%
89
80
80
Male
Female
Target
Target
TRIR of less than 0.5 per 200,000 hours worked.
We will continue to aim to conduct at least
6,000 NPS interviews per month.
Target
2030: Reduce absolute Scope 1, Scope 2
and Scope 3 (Business Travel and Employee
Commuting) by 50% vs 2019 base line.
Target
We aim to keep our voluntary permanent
turnover rate below 15% and increase our
Group Engagement Index to 90.
Target
2025: We aim to increase the proportion of
women in senior leadership roles to 30%.
Target
We aim to achieve 100% completion of our
annual compliance training by eligible employees.
1. As defined by the FTSE Women Leaders Review to allow
year-on-year comparison. This comprises the CEO and his
direct reports (N-1).
2. Eligible employees include those with access to the LUCIE
training platform and those receiving compliance training
face to face. This includes employees who are on parental
or other forms of long-term leave who accordingly do not
complete the training in the period of their leave. New
joiners complete training throughout the year as part of
their induction.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
28
Financial review
Intertek's science-based
advantage is delivering
earnings growth and
strong cash flow
Jonathan Timmis
Chief Financial Officer
We have made strong progress in 2022 across
revenue, earnings and cash, reflecting the
effectiveness of our performance approach and
the high quality of our earnings model. Thanks
to our cash discipline, we have maintained our
negative working capital position and delivered
a strong free cash flow ('FCF') generation."
Consolidated income statement commentary
Total reported Group revenue has increased by
14.6%, with 3.3% growth contributed by acquisitions,
a like-for-like ('LFL') revenue increase of 4.9% and
an increase of 640bps from foreign exchange,
reflecting sterling depreciation against most of
the Group's trading currencies.
Financial highlights
£3,193m
Revenue up
14.6% 8.2%
£452m
Statutory operating
profit up/(down)
4.4% (1.3%)
£520m
Adjusted operating
profit up
14.2%
Statutory operating
margin down
9.7% 3.8%
(130bps) (130bps)
16.3%
Adjusted operating
margin down
178.4p
Statutory diluted
EPS up/(down)
(70bps) (70bps)
0.3% (5.6%)
105.8p
Dividend per share
in line with PY
Negative
Working Capital
£386m
Adjusted Free Cash
Flow down
18.0%
Return on Invested
Capital (down)/up
(3.9%)
(20bps) 20bps
• Actual rates
• Constant rates
The Group’s LFL revenue reflected 3.9% growth
in the Products division, 5.6% growth in the Trade
division and 7.9% growth in the Resources division
at constant rates.
The Group’s adjusted operating profit was £520.1m,
up 3.8% at constant rates and 9.7% at actual rates.
The adjusted operating margin was 16.3%, a decrease
of 70bps from the prior year at constant rates.
The Group’s statutory operating profit after
Separately Disclosed Items ('SDIs') for the period was
£452.4m (2021: £433.2m), down 1.3% at constant
rates and statutory margin was 14.2% (2021: 15.5%).
The Group’s statutory profit for the year after tax
was £306.8m (2021: £306.7m).
Net financing costs
Adjusted net financing costs were £31.9m, an
increase of £3.5m on 2021 resulting from a
combination of higher interest expense and the
impact of foreign exchange rates. This comprised
£2.2m (2021: £1.5m) of finance income and £34.1m
(2021: £29.9m) of finance expense. Statutory net
financing costs of £32.6m included £0.7m costs
(2021: £8.6m income) relating to SDIs.
Tax
The adjusted effective tax rate was 26.3%, a
decrease of 0.2% on the prior year (2021: 26.5%).
The tax charge, including the impact of SDIs, of
£113.0m (2021: £106.7m), equates to an effective
rate of 26.9% (2021: 25.8%), the increase mainly
driven by a non-taxable credit relating to a SDI item in
2021. The cash tax on adjusted results was 21.9%
(2021: 22.9%).
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 29
Results for the year
Key financials
Adjusted
Revenue
Operating profit
Diluted EPS
Profit after tax
Cash flow from operations
Statutory
Revenue
Operating profit
Diluted EPS
Profit after tax
Cash flow from operations
Dividend per share
Dividends paid in the year
Five-year performance – Adjusted Diluted EPS1 (pence)
Dividend per share2 (pence)
2022
£m
2021
£m
+2.0% CAGR3
+8.2% CAGR3
3,192.9
2,786.3
520.1
211.1
359.8
722.0
473.9
190.8
327.5
695.8
3,192.9
2,786.3
452.4
178.4
306.8
704.1
433.2
177.9
306.7
679.2
105.8p
105.8p
170.6
170.6
2022
2021
2020
2019
2018
2017
211.1
2022
190.8
2021
170.9
2020
212.5
2019
198.3
2018
191.6
2017
105.8
105.8
105.8
105.8
99.1
71.3
1. Presentation of results: To provide readers with a clear and consistent presentation of the underlying operating performance of the Group’s business, some figures discussed in this
review are presented as adjusted, before SDIs (see note 3 to the financial statements in Book three, page 11). A reconciliation between adjusted and statutory performance measures
is set out overleaf. Figures before 1 January 2019 (when IFRS 16 was adopted) are on an IAS 17 basis.
2. Dividend per share for 2022 is based on the interim dividend paid of 34.2p (2021: 34.2p) plus the proposed final dividend of 71.6p (2021: 71.6p).
3. CAGR represents the compound annual growth rate from 2017 to 2022.
Earnings per share
Adjusted diluted earnings per share ('EPS') at actual exchange rates
was 10.6% higher at 211.1p (2021: 190.8p). Diluted EPS after SDIs
was 178.4p (2021: 177.9p) per share and basic earnings per share
after SDIs was 179.2p (2021: 178.7p).
Dividend
Reflecting the Group’s strong cash generation in 2022, the Board
recommends a full-year dividend of 105.8p per share, in line with
prior year.
The full-year dividend of 105.8p represents a total cost of £170.6m
or 50% of adjusted profit attributable to shareholders of the Group
for 2022 (2021: £170.6m and 55%). The dividend is covered 2.0 times
by earnings (2021: 1.8 times), based on adjusted diluted earnings per
share divided by dividend per share.
The underlying performance of the business, by division, is shown in the table below:
Products
Trade
Resources
Group total
Net financing costs
Adjusted profit before income tax
Adjusted income tax expense
Adjusted profit for the year
Adjusted diluted EPS (pence)
Notes
2
2
2
14
6
7
Revenue
Change at
2022 actual
rates
%
Change at
constant
rates
%
15.3
10.5
17.0
14.6
8.5
5.6
10.3
8.2
2022
£m
2,024.3
635.6
533.0
3,192.9
Adjusted operating profit
Change at
2022 actual
rates
%
Change at
constant
rates
%
6.8
12.2
56.2
9.7
9.6
9.9
10.6
–
14.0
50.9
3.8
3.9
4.2
4.6
2022
£m
426.9
57.9
35.3
520.1
(31.9)
488.2
(128.4)
359.8
211.1
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeFinancial review ContinuedContents 30
Acquisitions and investment
One of the key corporate goals of the Group’s 5x5 strategy is delivering
an accretive, disciplined capital-allocation policy.
As a result, the Group invests both organically and by acquiring or
investing in complementary businesses to strengthen our portfolio in
the locations demanded by clients. This approach enables the Group to
focus on those existing business lines or countries with good growth
and margin prospects where we have market-leading positions or to
enter new exciting growth areas offering the latest technologies and
Quality Assurance services.
Acquisitions
The Group completed one acquisition in the year (2021: three) with cash
consideration paid of £65.9m (2021: £480.9m), net of cash acquired of
£13.4m (2021: £15.8m), of which £2.7m has been paid in January 2023,
and a further contingent consideration payable of £12.9m.
In August 2022, the Group acquired of Clean Energy Associates, LLC
(‘CEA’), a market-leading independent provider of quality assurance,
supply chain traceability and technical services to the fast-growing
solar energy and energy storage sectors.
Acquisition of CEA presents a compelling strategic fit and opportunity
to expand Intertek’s service offering within the World of Energy to
provide Total Quality Assurance solutions for solar photovoltaic and
energy storage products and installations.
CEA’s service offering is highly complementary to Intertek’s existing
solar energy offerings in product testing and certification and in-field
inspections, creating a truly end-to-end value proposition in the solar
energy value chain for customers globally.
In 2022, £nil (2021: £10.9m) was spent in relation to consideration
for prior year acquisitions.
Organic investment
The Group also invested £116.5m (2021: £97.1m) organically in
laboratory expansions, new technologies (including software) and
equipment and other facilities. This investment represented 3.6%
of revenue (2021: 3.5%).
Pensions
The Group’s pension moved to a net surplus of £19.1m (2021: £1.4m
surplus) driven by periodic updates to our actuarial assumptions.
Separately Disclosed Items (‘SDIs’)
A number of items are separately disclosed in the financial statements
as exclusion of these items provides readers with a clear and consistent
presentation of the underlying operating performance of the Group’s
business. Reconciliations of the statutory to adjusted measures are
given below.
When applicable, these SDIs include amortisation of acquisition
intangibles; impairment of goodwill and other assets; the profit or loss on
disposals of businesses or other significant fixed assets; costs related to
acquisition activity; the cost of any fundamental restructuring; the costs
of any significant strategic projects; material claims and settlements;
and unrealised market or fair value gains or losses on financial assets or
liabilities, including contingent consideration.
Adjusted operating profit excludes the amortisation of acquired
intangible assets, primarily customer relationships, as we do not believe
that the amortisation charge in the income statement provides useful
information about the cash costs of running our business as these
assets will be supported and maintained by the ongoing marketing and
promotional expenditure, which is already reflected in operating costs.
Amortisation of software, however, is included in adjusted operating
profit as it is similar in nature to other capital expenditure.
The costs associated with our cost reduction programme are
excluded from adjusted operating profit where they represent changes
associated with operational streamlining, technology upgrades and
related asset write-offs and are costs that are not expected to reoccur.
The restructuring programme is expected to last up to five years. The
treatment as SDI is consistent with the disclosure of costs for similar
restructuring and strategic programmes previously undertaken.
The impairment of goodwill and other assets that by their nature or size
are not expected to recur, the profit and loss on disposals of businesses
or other significant assets, and the costs associated with successful,
active or aborted acquisitions are excluded from adjusted operating
profit in order to provide useful information regarding the underlying
performance of the Group’s operations.
The SDIs charge for 2022 comprises amortisation of acquisition
intangibles of £34.8m (2021: 29.3m); acquisition and integration costs
relating to successful, active or aborted acquisitions of £5.5m (2021:
£11.4m); and restructuring costs of £27.4m (2021: £nil).
Further information on SDIs is given in note 3 to the financial statements
in Book three, page 11.
2022 reconciliation of statutory
to adjusted performance measures
£m
Revenue
Operating profit
Operating margin (%)
Net financing costs
Statutory
SDIs
Adjusted
3,192.9
–
3,192.9
452.4
14.2%
(32.6)
67.7
2.1%
0.7
520.1
16.3%
(31.9)
Income tax expense
(113.0)
(15.4)
(128.4)
Profit for the year
Cash flow from operations
306.8
704.1
53.0
17.9
359.8
722.0
Basic EPS (pence)
179.2p
32.8p
212.0p
Diluted EPS (pence)
178.4p
32.7p
211.1p
2021 reconciliation of statutory
to adjusted performance measures
£m
Revenue
Operating profit
Operating margin (%)
Statutory
SDIs
Adjusted
2,786.3
433.2
15.5%
–
2,786.3
40.7
1.5%
473.9
17.0%
Net financing costs
(19.8)
(8.6)
(28.4)
Income tax expense
(106.7)
(11.3)
(118.0)
Profit for the year
Cash flow from operations
Basic EPS (pence)
Diluted EPS (pence)
306.7
679.2
178.7p
177.9p
20.8
16.6
12.9p
12.9p
327.5
695.8
191.6p
190.8p
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeFinancial review ContinuedContents 31
Return On Invested Capital at
constant currency
Free cash flow reconciliation
Key performance indicators
The Group uses a variety of key performance indicators (‘KPIs’) to
monitor the financial performance of the Group and its operating
divisions. The specific metrics and associated definitions are disclosed
on pages 24 and 25.
LFL revenue at constant currency is presented to show the Group’s
revenue excluding the effects of the change in the scope of the
consolidation (acquisitions following their 12-month anniversary of
ownership, and removes the historical contribution of any business
disposals/closures) and removing the impact of currency translation
from the Group’s growth figures.
Like-for-like revenue at
constant currency
2022
£m
2021
£m
Reported revenue
3,192.9
2,786.3
less: Acquisitions/disposals
revenue
(125.5)
(25.3)
Change
%
14.6
LFL revenue
3,067.4
2,761.0
11.1
Impact of foreign exchange
movements
LFL revenue at constant
currency
–
163.5
3,067.4
2,924.5
4.9
The rate of Return On Invested Capital (‘ROIC’), defined as adjusted
operating profit less adjusted taxes divided by invested capital,
measures the efficiency of Group investments. This is a key measure to
assess the efficiency of investment decisions and is also an important
criterion in the decision-making process.
ROIC in 2022 of 18.0% compares to 17.8% in the prior year at constant
exchange rates (2021: 18.2% at actual exchange rates).
2022
£m
2021
£m
Change
%
Adjusted operating profit
520.1
500.9
less: Adjusted tax1
(136.8)
(132.7)
Adjusted profit after tax
383.3
368.2
Invested capital2
2,130.1
2,073.1
3.8
3.1
4.1
2.7
ROIC %
18.0%
17.8%
20bps
1. Calculated by applying the adjusted effective tax rate (2022: 26.3%, 2021: 26.5%) to
adjusted operating profit.
2. Net assets excluding tax balances, net financial debt and net pension liabilities.
Cash flow and net debt
Cash flow
The Group relies on a combination of debt and internal cash resources
to fund its investment plans. One of the key metrics for measuring the
ability of the business to generate cash is cash flow from operations.
Due to the cash payments associated with the SDIs, and to provide a
complete picture of the underlying performance of the Group, adjusted
cash flow from operations is shown below to illustrate the cash
generated by the Group:
Cash conversion
Cash flow from operations
704.1
679.2
2022
£m
2021
£m
Change
%
3.7
17.9
16.6
722.0
695.8
3.8
add back: Cash flow relating
to SDIs
Adjusted cash flow
from operations
add back: Special
contributions to pension
schemes
Repayment of lease liability
2.0
(81.4)
2.0
(70.4)
627.4
–
(15.6)
2.4
Cash flow for cash conversion
642.6
Cash conversion %
123.6%
132.4%
(880bps)
2022
£m
2021
£m
Cash flow from operations
704.1
679.2
less: Net capital expenditure
add back: Interest received
less: Interest paid
less: Income tax paid
less: Lease liabilities paid
Free cash flow
add back: SDI cash outflow
Adjusted free cash flow
(112.3)
2.2
(37.5)
(96.1)
1.5
(27.0)
(106.7)
(102.0)
(81.4)
(70.4)
368.4
17.9
386.3
385.2
16.6
401.8
Net debt
The Group ended the period in a strong financial position. Financial net
debt was £737.9m, an increase of £4.6m on 31 December 2021. The
undrawn headroom on the Group’s existing committed borrowing
facilities at 31 December 2022 was £707.3m (2021: £564.2m).
Total net debt, including the impact of the IFRS 16 lease liability, was
£1,060.1m (2021: £1,025.6m).
The Group has a well-balanced loan portfolio to enable the funding of
future growth opportunities with a maturity profile as shown overleaf.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeFinancial review ContinuedContents 32
Working capital
During 2022, we have continued our working capital focus and, through
disciplined performance management, we have maintained our negative
working capital position at negative £47.8m (2021: negative £43.3m).
Working capital has moved to (1.5%) of revenue, reflecting 10bps decline
year-on-year.
Adjusted free cash flow (£m)
1.5% CAGR1
Five-year trend – Working capital1 as % of revenue
(650bps)
2022
2021
2020
2019
2018
2017
(1.5)
(1.6)
(0.1)
3.4
3.9
5.0
2022
2021
2020
2019
2018
2017
Under existing facilities, the Group has available debt headroom
of £707.3m at 31 December 2022. The components of net debt
at 31 December 2022 are outlined below:
386.3
401.8
435.6
395.3
372.6
358.5
1 January
2022
£m
264.0
(997.3)
Cash and
non-cash
movements
£m
Exchange
adjustments
£m
31 December
2022
£m
51.7
58.1
5.0
320.7
(119.4)
(1,058.6)
(733.3)
109.8
(114.4)
(737.9)
Cash1
Borrowings2
Financial net
debt
Lease liabilities2
(292.3)
Net debt
(1,025.6)
(11.0)
98.8
(18.9)
(322.2)
(133.3)
(1,060.1)
1. CAGR represents the compound annual growth rate from 2017 to 2022.
Borrowings by maturity profile
(At 31 December 2022)
1. As disclosed in note 14 of the financial statements in Book three, page 26
2. Borrowings include £1.5m of non-cash movements related to amortisation of facility
fees (see note 14 of the financial statements in Book three, page 26). Lease liabilities
include £92.4m of non-cash movements.
1. Working capital is defined under the consolidated statement of financial position
within the financial statements in Book three, page 3.
2. Figures before 1 January 2019 (when IFRS 16 was adopted) are on an IAS 17 basis.
Less than one year
One to five years
Over five years
25%
37%
38%
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeFinancial review ContinuedContents To ensure the Group is not exposed to income statement volatility in
relation to foreign currency translation on its debt, the Group ensures
that any foreign currency borrowings are matched to the value of its
overseas assets in that currency (an ‘effective’ hedge).
The Group borrows primarily in US dollars, and any currency translation
exposures on the borrowings are offset by the currency translation on
the US dollar and US dollar-related overseas assets of the Group.
The composition of the Group’s gross borrowings in 2022, analysed by
currency, is as follows:
Borrowings by currency
(At 31 December 2022)
AUD
USD
5%
95%
33
Foreign currency movements
The Group transacts in over 80 currencies across more than 100
countries, and revenue and profit are impacted by currency fluctuations.
However, the diversification of the Group’s revenue base provides a
partial dilution to this exposure.
At constant rates, revenue grew 8.2% (actual rates 14.6%) and adjusted
operating profit grew 3.8% (actual rates 9.7%).
The exchange rates used to translate the statement of financial
position and the income statement into the Group’s functional currency,
sterling, for the five most material currencies used in the Group are
shown below:
Value of £1
US dollar
Euro
Chinese
renminbi
Hong Kong
dollar
Australian
dollar
Statement of
financial position rates
Income statement
rates
2022
1.20
1.13
2021
1.35
1.19
2022
1.24
1.17
2021
1.38
1.16
8.45
8.59
8.31
8.89
9.37
10.52
9.68
10.70
1.78
1.86
1.78
1.83
Significant accounting policies
The consolidated financial statements in Book three are prepared in
accordance with IFRS as adopted by the UK. Details of the Group’s
significant accounting policies are shown in note 1 to the financial
statements in Book three, page 7.
Jonathan Timmis
Chief Financial Officer
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeFinancial review ContinuedContents Operating review
Products
Good performance
£2,024.3m
Revenue
£426.9m
Adjusted operating profit
£376.5m
Statutory operating profit
Intertek value proposition
Our Products-related businesses consist of
business lines that are focused on ensuring
the quality and safety of physical components
and products, as well as minimising risk through
assessing the operating processes and quality
management systems of our customers.
As a trusted partner to the world’s leading
retailers, manufacturers and distributors, the
division supports a wide range of industries
including textiles, footwear, toys, hardlines, home
appliances, consumer electronics, information
and communication technology, automotive,
aerospace, lighting, building products, industrial and
renewable energy products, food and hospitality,
healthcare and beauty, and pharmaceuticals.
Across these industries we provide a wide
range of ATIC services, including laboratory
safety, quality and performance testing, second-
party supplier auditing, sustainability analysis,
product assurance, vendor compliance, process
performance analysis, facility plant and equipment
verification and third-party certification.
Strategy
Our TQA value proposition provides a systemic
approach to support the Quality Assurance efforts
of our Products related customers in each of the
areas of their operations. To do this we leverage
our global network of accredited facilities and world
leading technical experts to help our clients meet
high quality safety, regulatory and brand standards,
develop new products, materials and technologies
and ultimately assist them in getting their products
to market quicker, to continually meet evolving
consumer demands.
2022 performance
Our Products division delivered a good performance
overall.
We delivered a good LFL revenue growth of 3.9%
at constant rates notwithstanding the impact of
Covid in Q2 and November-December in China, the
supply chain disruption in the automotive industry
and the slow-down in new product development in
Softlines and Hardlines in Q4. Outside of China our
LFL revenue growth was 5.5% at constant rates.
34
Business lines
Softlines
Providing a range of solutions for textiles, garments,
footwear and personal protective equipment.
Transportation Technologies
Providing diverse, rapid testing and validation services
to the transportation industry.
Our role: Our solutions enable fashion retailers, brands
and manufacturers to gatekeep regulatory compliance,
while continuously improving their product performance
in terms of quality, safety and sustainability.
Our role: Our Transportation Technologies expertise
is recognised by leading manufacturers worldwide.
We evaluate everything from automobiles and energy
storage to airplanes, and deliver top-tier testing for
emerging markets, such as autonomous and electric/
hybrid vehicles.
Hardlines
Comprehensive solutions for a wide variety of toys
and hardgoods.
Food
Providing testing, inspection, auditing, certification
and advisory services to food companies.
Our role: Solutions for toys, children’s and juvenile
products, household products, furniture, and office
supplies. We help our customers meet regulatory
and retailer-specific requirements, improve product
performance and differentiation through benchmarking,
and facilitate global market access.
Our role: We help major global brands to launch new
food products, support food health initiatives, ensure
safety and quality across the supply chain, help reduce
food-borne diseases, and enable developing nations to
increase their global food exports.
Electrical & Connected World
Helping clients meet safety, performance,
environmental and quality requirements and delivering
best-in-class networking and cyber security solutions
for today’s wireless and connected devices.
Our role: We bring more than 100 years of product
testing and certification expertise to a wide range of
industries, such as Medical, Lighting, Energy, Appliances
& Electronics, Industrial Equipment, and IT & Telecom
Equipment. We also provide comprehensive hardware,
software, and cyber security solutions to help clients
rapidly launch secure and reliable products in each
industry and sector around the world.
Chemicals & Pharma
Enabling clients' product development, regulatory
authorisation and production.
Our role: Our analytical and assurance solutions
accelerate product development and mitigate risks
associated with product quality and safety, processes,
and supply chains for the pharmaceutical, chemical,
polymer, packaging, medical device, and cosmetic
sectors.
Business Assurance
Providing a full range of business process audit and
support solutions.
Building & Construction
Providing testing, inspection, certification and
engineering services to the construction industry.
Our role: We enable our clients to improve their
operations, meet regulatory requirements, mitigate
business risks, reduce their environmental impact,
qualify their suppliers, and help them achieve their
business objectives.
Our role: We offer a full-suite of product-related
testing and certification capabilities, plus project-
related assurance, testing, inspection, and consulting
services that are unparalleled in the building and
construction market.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Our operating profit of £426.9m was flat at constant
rates and up 6.8% at actual rates versus 2021,
resulting in an operating margin of 21.1%. This is
180 basis points at constant rates lower compared
to 2021 when we benefitted from unusually high
government subsidies, and in 2022 we were impacted
by the Covid-19 disruptions in China and inflationary
pressure in North America, Europe and Australia.
• In H2 2022 our Softlines business delivered
low-single digit LFL revenue growth, resulting in a
mid-single digit growth in LFL revenue for the year.
The business benefitted from continuous growth
in e-commerce, increased demand for testing
protective equipment and the reduction in the
lockdown activities in some of our markets
although we continue to see store closures in
Western Europe and North America.
• Our Hardlines business reported stable LFL revenue
growth in H2 and low-single digit growth in LFL
revenue in 2022. Hardlines saw further growth in
e-commerce, increased consumer demand for home
furniture and toys as well as from the reduction in
the lockdown activities in some markets more than
offsetting continuing closures of stores in Western
Europe and North America.
• Our Electrical & Connected World business
delivered low-single digit LFL revenue growth
in the second half to register low-single digit
LFL revenue growth for the year. This reflects
increased ATIC activities driven by greater
regulatory standards in energy efficiency,
Financial highlights 2022
Revenue
Like-for-like revenue
Adjusted operating profit
Adjusted operating margin
Statutory operating profit
Statutory operating margin
35
the higher demand for testing and certification
of medical devices, the increased testing
requirements for 5G and greater corporate
focus on cyber security.
• Our Business Assurance business delivered
double-digit LFL revenue growth for the second
half and the full year. The reduction of lockdown
activities has driven a rebound in the number of
ISO audits in some of our operations, while we
continue to benefit from the attractive growth in
supply chain assurance, the continuous focus on
ethical supply, the increased needs of corporations
for sustainability assurance and the strong growth
in our People Assurance segment.
• Our Building & Construction business reported
mid-single digit LFL revenue growth in H2 and
mid-single digit LFL revenue for the year. We
continue to benefit from the growing demand for
more environmentally friendly and higher quality
buildings, but the number of large infrastructure
projects continues to be below 2021.
• Our Transportation Technology business saw
double-digit negative LFL revenue growth in H2
2022 and high-single digit negative LFL revenue
for the year. Following the lower demand for
testing activities in Western Europe and North
America, the second half saw increased investment
by our clients in new powertrains to lower CO2/NOx
emissions and improve fuel efficiency.
• Our Food business registered mid-single digit LFL
revenue growth in the second half and for the full
year. We are benefitting from the resumption of
client supply operations in most markets, from
the sustained demand for food safety testing
activities and the higher demand for hygiene
and safety audits in factories.
• We saw low-single digit LFL revenue growth in
the second half and for the year in our Chemical
& Pharma business. We benefitted from an
improvement of demand for regulatory assurance
and chemical testing in some of our operations in
North America and Western Europe and from the
increased R&D investments of the pharma industry.
2023 outlook
In 2023, we expect our Products division to deliver
a good LFL revenue growth at constant currency.
Mid- to long-term growth outlook
Our Products division will benefit from mid-to long-term
structural growth drivers including product variety,
brand and supply chain expansion, product innovation
and regulation, the growing demand for quality and
sustainability from developed and emerging economies,
the acceleration of e-commerce as a sales channel, and
the increased corporate focus on risk.
Our TQA value proposition
provides a systemic approach to
support the Quality Assurance
efforts of our Products-related
customers in each of the areas
of their operations."
2022
£m
2021
£m
Change at
actual rates
2,024.3
1,755.3
1,910.7
1,730.0
399.7
15.3%
10.4%
6.8%
Change at
constant
rates
8.5%
3.9%
-%
426.9
21.1%
376.5
18.6%
22.8%
(170bps)
(180bps)
365.4
3.0%
20.8%
(220bps)
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOperating review ContinuedContents Science-based Innovation
We continue to invest in innovation to deliver a superior
customer service in our Products-related businesses.
36
In action
SourceClear
A bespoke solution to support our
customers' sustainability goals
In action
Inlight
In action
EcoCheck
Managing complex
supply chains
Scientific approach
to sustainability
What it is: Through Intertek Inlight™, we
provide the technology and expertise that
enables organisations to better understand their
supply chain risks and protect their brand. With
our Wisetail online learning platform built in, it
offers them enhanced analytics to manage their
complex global supply chains and make real-time
supplier decisions.
Customer benefit: Inlight is a cost-effective
solution for global companies who require
trusted information about the identities,
capabilities and compliance of their supplier
partners. It allows users more flexibility and
customisation in their supply chain programmes,
and offers live dashboards of suppliers’
performance, trends, risks and opportunities,
as well as training.
What it is: EcoCheck is a unique 'green'
certification scheme in the travel, tourism, and
hospitality sectors that looks at our customers’
complete environmental credentials. It takes a
scientific and systemic approach to sustainability
by employing a series of checkpoints, with
criteria informed by the UN Global Compact 10
Principles that advance the UN Sustainable
Development Goals.
Customer benefit: Our customers’ guests
can take comfort from the EcoCheck certificate
that their stay was sustainable. It offers guests
reassurance that their chosen travel operators
are actively working to increase their own
sustainability through robust analyses, tourism-
specific solutions, comparative benchmarking,
and an emphasis on actionable results.
What it is: SourceClear™ was developed
to support our customers' sustainability
journey, while fulfilling the demands of today's
consumers. It manages and certifies product
and materials data and business transactions
throughout their supply chain, providing
traceability and independent validation of
product sustainability claims, enabling accurate
and verified labelling of their products.
Customer benefit: Through SourceClear
companies of all sizes can demonstrate that
their products and brands are environmentally
friendly, socially responsible, and have a
positive impact on society. It will manage the
end-to-end process for scope certificates and
transaction certificates against the Textile
Exchange’s Recycled Claim Standard and
Global Recycled Standard.
In action
Global Market Access
24/7 access to curated
and up-to-date compliance
information
What it is: We have developed the Global Market
Access portal to support our customers by
providing a convenient one-stop knowledge
database to help them bring their products to
global markets with speed. The portal covers
more than 180 consumer product types for
40 different markets – from soft goods such
as apparel, and textiles, to hard goods such
as cookware and furniture.
Customer benefit: Our self-help Global Market
Access portal allows compliance and quality
managers to get all the regulatory, testing,
and recall information they need in one place
instantly with just a few simple clicks. Currently,
we offer four e-Services on the portal, including
Regulatory Sheet, Test Plan, Recall Summary and
Gap Analysis, to expediate global market access
for consumer products.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOperating review ContinuedContents In action
Protek
Clean air and healthy
indoor environments
As a trusted partner to the
world’s leading retailers,
manufacturers and distributors,
Intertek's Products business
lines support a wide range of
industries in over 100 countries.
What it is: ProtekTM Facility Health Management
helps our customers take a comprehensive,
practical, and customised approach to the design
and operation of indoor environments. The
product’s services include the assessment of
unique risks and opportunities, alongside efficacy
and validation testing that gives confidence to
both our customers and their stakeholders.
Customer benefit: With organisations facing
increased demand for indoor environments
that support health and wellness, they need
our science-based approach that will reduce
the risks of pathogen transmission and enhance
their buildings’ air quality and comfort. Our
bespoke solutions help them to mitigate risk,
and increase employee and customer trust,
satisfaction, and loyalty.
In action
ToxClear
Delivering safer, cleaner
and more sustainable
fashion supply chains
What it is: ToxClear is an innovative digital
chemical management platform for the fashion
industry, which enables our customers to detox
their supply chains. Its end-to-end Total Chemical
Assurance solutions help them to reduce
hazardous chemicals used in the input, process,
and output stages of their operations, and offer
transparency across their production and
chemical usage.
Customer benefit: ToxClear connects with
ZDHC Gateway, a Chemical Module for real-time
ZDHC Manufacturing Restricted Substances
List ('MRSL') conformance data mapping and
generation of ZDHC Performance 'InCheck'
Reports. These reports provide total traceability
and transparency of chemicals used across
complex supply chains. This gives clients full
visibility of their chemical inventories to evaluate
conformance with the ZDHC MRSL to help them
achieve zero discharge of hazardous chemicals.
37
In action
CircularAssure
Helping the
polymer/plastics
sector move
towards a circular
economy
What it is: CircularAssure is
an innovative programme
of assurance, testing and
certification services which can
be applied across the recycled
plastic value chain, from waste
collectors and recycling
companies to polymer producers
and brands. It enables them to
optimise the value of recycled
materials and products within
the plastics/polymer circular
economy while maintaining
quality and safety.
Customer benefit: By adopting
CircularAssure, chemical
recycling companies can use
our chemical analysis technology
to boost process efficiencies;
polymer producers can assess
new recycled materials; waste
collectors and mechanical
recycling companies can use
our insight-enabling testing to
improve profitability; and brands
can demonstrate the levels
of recycled content in their
products through our recycled
content certification.
In action
Green R&D
Striking the
right balance
What it is: The demand for
eco-friendly products has
increased significantly as
consumers want to ensure
that the products they are
purchasing have been created
with minimal impact to the
environment. Intertek Green
R&D is an integrated solution
that ensures the sustainability,
quality and safety attributes
of a product are optimised
throughout its lifecycle.
Customer benefit: Green R&D
is a bespoke science-based
solution designed to provide
customers with a holistic view
of their product development –
offering safety, quality, and
performance testing and
analysis, regulatory assessment
and end-to-end environmental
assessment. These services
help companies mitigate risk
and protect their brands
through striking the right
balance between quality, safety,
and performance attributes.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOperating review ContinuedContents Trade
Double digit profit growth
£635.6m
Revenue
£57.9m
Adjusted operating profit
£49.3m
Statutory operating profit
Intertek value proposition
Our Trade division consists of three global business
lines with global and regional trade flow based on
similar mid- to long-term structural growth drivers:
Our Caleb Brett business provides cargo inspection,
analytical assessment, calibration and related
research and technical services to the world’s
petroleum and biofuels industries.
Our Government & Trade Services (‘GTS’) business
provides inspection services to governments and
regulatory bodies to support trade activities that
help the flow of goods across borders, predominantly
in the Middle East, Africa and South America.
Our AgriWorld business provides analytical and
testing services to global agricultural trading
companies and growers.
Strategy
Our TQA value proposition assists our Trade-related
customers in protecting the value and quality of their
products during their custody-transfer, storage and
transportation, globally, 24/7.
Our expertise, service innovations and advanced
analytical capabilities allow us to optimise the return
on our customers’ cargoes and help them resolve
difficult technical challenges.
Our independent product assessments provide
peace of mind to our government clients that the
quality of products imported into the country meet
their standards and import processes.
2022 performance
Our Trade division delivered a mid-single digit
LFL revenue growth of 5.6% at constant rates
as we benefitted from the increased demand for
Inspection and Testing in Energy and Agri products.
Outside of China our LFL revenue growth was 7.0%
at constant rates.
We delivered an operating profit of £57.9m, 14.0%
higher at constant rates and 12.2% at actual rates
compared to 2021. This resulted in an operating
margin of 9.1%, up by 70bps at constant rates
versus 2021 despite higher-than-expected
inflation in several markets.
38
• Caleb Brett, a global leader in the Crude Oil and
refined Products global trading markets, benefitted
from improved momentum driven by increased
global mobility with high-single digit LFL revenue
growth in the second half and for the full year.
• Our GTS business provides certification services
to governments in the Middle East, Africa and
South America to facilitate the import of goods in
their markets, based on acceptable quality and
safety standards. This business saw double-digit
negative growth in LFL revenue in H2 and the full
year due to the termination of two contracts for
profitability reasons.
• AgriWorld provides inspection activities to ensure
that the global food supply chain operates fully
and safely. The business reported mid-single
digit LFL revenue growth for the second half and
high-single digit LFL revenue growth for the full
year. We continue to benefit from an increase in
demand for inspection activities driven by the
strong growth in the global food industry.
2023 outlook
In 2023, we expect our Trade division to deliver good
LFL revenue growth at constant currency.
Mid- to long-term growth outlook
Our Trade division will continue to benefit from both
regional and global trade-flow growth, as well as the
increased customer focus on quality, quantity
controls and supply chain risk management.
Financial highlights 2022
Revenue
Like-for-like revenue
Adjusted operating profit
Adjusted operating margin
Statutory operating profit
Statutory operating margin
Business lines
Caleb Brett
Specialised cargo inspection and analytical
assessment services to the oil and gas, chemical
and other commodities markets.
Our role: We offer global 24/7/365 services covering
cargo and inventory inspection services, analytical
assessment, calibration and related research and
technical services to the world’s petroleum and
biofuels industries.
Government & Trade Services
Providing conformity assessment services to
governments, regulatory bodies, exporters and
importers to support trade compliance.
Our role: We support governments, customs
authorities, exporters and importers by ensuring
imported goods comply with international safety and
quality standards. Our worldwide network of offices
delivers rapid inspection and certification.
AgriWorld
Providing assurance, testing, inspection and
certification services across the entire agricultural
supply chain.
Our role: We offer an extensive array of services
including inspection services, monitoring the quality
and quantity of cargo from source to destination;
and high-quality analysis for the Agri-biotech and
breeding industries and assurance services
supporting sustainable farming practices. Our
global experts offer seamless support, and provide
traceability throughout the entire supply chain.
2022
£m
635.6
635.2
57.9
9.1%
49.3
7.8%
2021
£m
Change at
actual rates
Change at
constant rates
575.4
575.4
51.6
9.0%
50.2
8.7%
10.5%
10.4%
12.2%
10bps
(1.8%)
(90bps)
5.6%
5.6%
14.0%
70bps
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOperating review ContinuedContents 39
In action
AgriWorld
Rapid On-site Testing
of Grains and Cereals
What it is: Key to Intertek AgriWorld’s end-to-
end risk-based Quality Assurance solutions are
the various services connecting agricultural
supply chains to facilitate sustainable trade.
This includes Rapid On-site Testing of Grains
and Cereals where the implementation of the
latest technological testing methods provides
results to customers within minutes, allowing
stakeholders to make informed decisions fast.
These tests are performed all along the value
chain on important quality and safety
parameters such as Protein, Fat Content,
Moisture, Aflatoxins and others.
Customer benefit: Our service solution
promotes the sustainability of agricultural
supply chains, as customers are able to
maintain full traceability, reduce food loss
and waste, and make informed decisions in
real time. The visibility into quality and safety
provided by rapid testing and delivery of
results helps to prevent cargo degradation
whilst optimising quality segmentation.
Science-based Innovation
We continue to invest in innovation to deliver a superior
customer service in our Trade-related businesses:
In action
Inview
In action
Tradeable
Advanced remote auditing
and inspection services
Ground-level trade support
and expertise
What it is: Intertek InviewTM is our remote
inspection solution that helps organisations
conduct faster and more efficient inspections.
During an Inview inspection, an Intertek expert
will conduct the inspection remotely via live
video using a hand-held device allowing them to
follow the same rigorous quality procedures as
those performed by our on-site inspectors for
pre-shipment and commercial inspections of
goods and shipments.
Customer benefit: Inview has been updated to
provide even more information from each audit.
The inclusion of automated carbon footprint
metrics and other new features ensures that an
audit conducted with Inview now delivers more
analytical value and information to facilitate the
reduction of a company’s carbon footprint and
help our customers in their ESG journey.
What it is: Intertek Tradeable provides trade
support and expertise to deliver a comprehensive
portfolio of pre-shipment solutions that enable
the validation of suppliers or manufacturers, as
well as production, shipment and goods handling
processes. Our solutions facilitate risk mitigation
right across the international supply chain, and
we can tailor bespoke packages to meet our
customers’ specific requirements.
Customer benefit: Tradeable helps our
customers protect their reputation and brand,
enhances their quality control throughout the
production process, minimises shipment delays
and reduces the need for re-work, which
empowers them to manage their supply chain
risks better. We deliver the ground-level trade
support and expertise they need to trade with
confidence in an ever more complex and
challenging trading environment.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOperating review ContinuedContents Resources
Growth acceleration
£533.0m
Revenue
£35.3m
Adjusted operating profit
£26.6m
Statutory operating profit
Intertek value proposition
Our Resources division consists of two business
lines with similar mid- to long-term structural
growth drivers.
Industry Services uses in-depth knowledge of the
oil, gas, nuclear and power industries to provide a
diverse range of TQA solutions to optimise the use of
customers’ assets and minimise the risk in their supply
chains. Some of our key services include technical
inspection, asset integrity management, analytical
testing and ongoing training services. Our Minerals
business provides a broad range of ATIC service
solutions to the mining and minerals exploration
industries, covering the resource supply chain from
exploration and resource development, through to
production, shipping and commercial settlement.
Strategy
Our TQA value proposition allows us to help
customers gain peace of mind that their projects
will proceed on time and their assets will continue to
operate with a lower risk of technical failure or delay.
Our broad range of services allows us to assist clients
in protecting the quantity and quality of their mined
and drilled products, improve safety and reduce
commercial risk in the trading environment.
2022 performance
Our Resources division delivered a robust LFL
revenue growth of 7.9% at constant rates driven
by the increased Capex investments of our energy
clients in traditional Oil & Gas and renewables as well
as by the higher demand in Minerals. Outside of China
our LFL revenue growth was 8.5% at constant rates.
Revenue of £533.0m was up 17.0% at actual rates
40
and 10.3% at constant rates. We delivered an
adjusted operating profit of £35.3m, 51% higher
at constant rates and up 56% at actual rates.
Our adjusted operating margin of 6.6% was 180
basis points higher at constant rates despite the
higher-than-expected inflation in several markets.
• In Exploration and Production operations, our
Capex Inspection services business delivered
high-single digit LFL revenue growth in both
the second half and full year.
• We delivered low-single digit negative LFL revenue
growth in Opex Maintenance services in H2 2022,
resulting in a low-single digit negative LFL revenue
growth in 2022.
• Increased demand for testing and inspection
activities saw our Minerals business deliver double-
digit LFL revenue growth in the second half and for
the full year.
2023 outlook
In 2023, we expect our Resources division to deliver
a robust revenue growth at constant currency.
Mid- to long-term growth outlook
Our Resources division will grow in the mid-to
long-term as we benefit from investments in energy
to meet the demands of the growing population
around the world.
Business lines
Industry Services
Ensuring the safe and optimised use of
customers’ assets and minimising quality
risks in their supply chains.
Our role: Our Industry Services business
line uses its in-depth knowledge of industries
such as renewable energy, oil and gas, and
petrochemical to provide customers with a
diverse and technologically advanced range
of TQA solutions. The services we offer include
technical inspection, non-destructive and
materials testing, and asset performance
management.
Minerals
Providing a wide range of services to the
mining and minerals exploration industry.
Our role: Located in key mining locations
across the globe, and operating an extensive
network of mineral laboratories, Intertek
Minerals offers expert inspection, analytical
testing and advisory services to the Minerals,
Exploration, Ore and Mining industries. We cover
each step of the supply chain from exploration,
production, sampling and inspection, to
commercial trade settlement analysis.
Financial highlights 2022
Revenue
Like-for-like revenue
Adjusted operating profit
Adjusted operating margin
Statutory operating profit
Statutory operating margin
2022
£m
533.0
521.5
35.3
6.6%
26.6
5.0%
2021
£m
Change at
actual rates
Change at
constant
rates
10.3%
7.9%
50.9%
17.0%
14.5%
56.2%
160bps
180bps
51.1%
110bps
455.6
455.6
22.6
5.0%
17.6
3.9%
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOperating review ContinuedContents
Science-based Innovation
We continue to invest in innovation to deliver a superior
customer service in our Resources-related businesses:
In action
DeepView 3d
Optimal
condition-based
maintenance
What it is: Intertek DeepView
3d is an advanced and
sustainable inspection
technology that combines
inspection expertise, robotics,
laser scanning and advanced
non-destructive testing
('NDT'). It sets a new standard
for digital mechanical integrity
and digital condition
assessment data, and helps
our customers establish digital
condition-based maintenance
programmes that track and
ensure equipment safety
and reliability.
Customer benefit: We
worked with an international
deepwater drilling contractor
to assess and analyse
equipment condition at their
facility at the Port of Houston
in Texas. Our team was able
to gather digital condition
data through laser scanning,
advanced NDT and a
metrology assessment of the
major components of their
blowout preventer ('BOP') in
just a few days, all without
disassembling, reducing
the overall cost and non-
productive time of the BOP
while providing a digital base
line and current condition.
41
In action
Intertek Hydrogen
In action
RiskAware
End-to-end quality, safety
and sustainability solutions
for the Hydrogen industry
Partnership with
Venture Global
What it is: Hydrogen is increasingly viewed as
a leading energy transition fuel providing a way
to decarbonise industries and support greater
efficiency within renewable energy sectors.
Intertek Hydrogen provides customers an
innovative, end-to-end ATIC platform that
provides a trusted and single-source partnership
for support and guidance along every stage of
the hydrogen value chain. In addition, it gives
the hydrogen industry access to our extensive
global network of trusted experts, risk-
mitigating technical services, and global
end-to-end risk-based quality, safety and
sustainability solutions.
Customer benefit: As the global hydrogen
industry expands and develops, the safety and
regulatory challenges facing commercialisation
of this technology is becoming more critical for
our customers. Intertek Hydrogen helps them
advance the sector, successfully develop and
execute hydrogen-based projects, and create
viable ecosystems. It also helps them overcome
the safety challenges and navigate the sector’s
increasingly complex regulatory requirements.
What it is: As a leader in global inspection
services, our people gather and analyse
hundreds of data points from quality assurance
and quality control non-conformance reports,
inspection and testing results, as well as health,
safety and environment reports. With RiskAware,
our customers are able to establish more
efficient and cost-effective Quality, Health,
Safety and Environment (‘QHSE’) programmes
that address areas of higher risk to help reduce
the cost of quality.
Customer benefit: Our customer, Venture
Global, chose Intertek due to our global reach,
quality reporting tools, and experience in vendor
and site quality inspection. They have achieved
facility start-up ahead of schedule, in part, due
to our thorough inspections and utilisation of
RiskAware. On the Calcassieu Pass project, we
deployed our RiskAware processes and reporting
tools. This helped ensure on-schedule equipment
deliveries and installations.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOperating review ContinuedContents In action
CarbonClear
Part of the
Xpansiv Digital
Fuels Program
ecosystem
What it is: Intertek CarbonClear
provides a unique carbon
emissions intensity certification
programme to consistently
evaluate emissions across all
supply chain stages. It can
validate and disclose the carbon
impact or intensity per project or
across a company's whole
portfolio, as well as identify key
areas for emissions improvement
versus peers and other
industries.
Customer benefit: Intertek has
joined the Xpansiv Digital Fuels
Program ecosystem as Digital
Crude Oil ('DCO') certification
partner, providing data-quality
assurance, carbon-intensity
benchmarking and independent
certifications to the Program.
In action
CarbonZero
Providing
independent
carbon-neutral
certification
What it is: Our CarbonZero
programme complements the
Intertek CarbonClear programme.
It certifies the achievement of
carbon neutrality by combining
emissions intensity certifications,
such as CarbonClear, together
with certification of traceable
high-quality carbon capture or
reduction investments. The
programme can be applied
at any phase of production,
manufacturing, assembly or
delivery, regardless of industry
or supply chain configuration.
Customer benefit: The first
Intertek CarbonZero certification
was awarded to Aker BP, for the
verified carbon neutral sale of
600,000 barrels of Edvard Grieg
production. This certification
enables companies worldwide
to confidently market qualifying
carbon neutral products and
services as Intertek CarbonZero
Verified, thereby demonstrating
their tangible and auditable
progress on the path to carbon
neutrality.
42
In action
Minerals Global Centre of Excellence celebrates key milestones
What it is: Our Minerals Global Centre of
Excellence, located in Perth, Western Australia,
is a 20,000m2, purpose-built space that brings
together the Group’s Minerals business. In
2022, we celebrated the first anniversary of
this multi-service, state-of-the-art facility,
built to support our mining and exploration
customers to deliver the future-focused
commodities that will underpin a more
sustainable world.
Customer benefit: The pioneering facility
is one of the largest, highly automated and
most technologically advanced minerals
laboratories in the world, providing customers
with instant access to world class technical
expertise, technology, innovation and services
all in one location. Since opening it has reached
a number of operational milestones, processing
more than three million samples in the first
year of operations, including one million
PhotonAssayTM samples.
In action
PipeAware
Working across
multiple vendor
locations in four
different countries
What it is: Intertek PipeAwareTM
is an innovative digital solution
combining pipeline traceability
with inspection data to give
valuable, real-time insight on
pipeline quality and compliance.
It offers pipeline owners and
operators traceability and easy
access to the inspection, testing
and material data needed to
make informed decisions that
ensure pipelines operate safely
and efficiently.
Customer benefit: Working with
a major oil company on a project
that involves laying more than
300 miles of pipe, PipeAwareTM
offers cost-effective and faster
access to critical data, which is all
stored securely in one location.
The data includes all inspection
observations on individual pipe
joints, including dents, stencil or
marking errors, coating repairs,
and bevel damage.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeOperating review ContinuedContents Principal risks and uncertainties
Assessing and
managing our risks
This section sets out a description of the
principal risks and uncertainties that could
have a material adverse effect on the Group’s
strategy, performance, results, financial
condition and reputation.
43
Principal risks
The Group is affected by a number of risk factors,
some of which, including macroeconomic and
industry-specific cyclical risks, are largely outside the
Group’s control. Some risks are particular to Intertek’s
operations. The principal risks of which the Group is
aware are detailed on the following pages, including
a commentary on how the Group mitigates these
risks. These risks and uncertainties do not appear
in any particular order of potential materiality or
probability of occurrence.
There may be other risks that are currently unknown
or regarded as immaterial which could turn out to be
material. Any of these risks could have the potential
to impact the performance of the Group, its assets,
liquidity, capital resources and its reputation.
Changes to principal risks
Our principal risks continue to evolve in response
to our changing risk environment. We have removed
Sustainability – the risk of extreme weather events
impacting our operations – as a principal risk for
2022: this follows the outcome of a portfolio
exposure assessment which we conducted with
Willis Towers Watson and which shows that the
predicted impact of climate-related physical risks is
likely to be localised and not material at the Group
level (for further details see our TCFD statement
on pages 53 to 55).
Long-term viability statement
In accordance with provision 31 of the UK Corporate
Governance Code, the Directors have assessed the
viability of the Group over a five-year period to
31 December 2027, by carrying out a robust
assessment of the potential impact of the principal
risks and uncertainties on the Group’s current position,
including those that would threaten the Group’s
business model, future performance, solvency or
liquidity. This is documented on the following pages.
The Directors have determined that a five-year
period is an appropriate period over which to provide
the viability statement of the Group, as the Group’s
strategic review covers a five-year period.
Risk framework
The Board has overall responsibility for the
establishment and oversight of the Group’s risk
management framework. This work is complemented
by the Group Risk Committee, whose purpose is to
manage, assess and promote the continuous
improvement of the Group’s risk management,
controls and assurance systems.
This risk governance framework is described in more
detail in the Directors’ Report in Book two, on pages
47 and 50.
The Group Audit Director and the Group General
Counsel, who report to the Chief Financial Officer
and Chief Executive Officer respectively, have
accountability for reporting the key risks that the
Group faces, the controls and assurance processes
in place and any mitigating actions or controls.
Both roles report to the Audit Committee, attend
its meetings and meet with individual members
each year as required.
Risks are formally identified and recorded in a risk
register which is owned by each of the Group’s
divisional, regional and functional risk committees.
Risk registers are updated throughout the year by
these risk committees and are used to plan the
Group’s internal audit and risk strategy.
In addition to the risk registers, all senior executives
and their direct reports are required to complete an
annual return to confirm that management controls
have been effectively applied during the year.
The return covers Sales, Operations, IT, Finance,
Sustainability and People.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 44
Furthermore, the Directors believe the five-year
period appropriately reflects the average business
cycles of the business lines in which the Group
operates, particularly in relation to capital
expenditure investment horizons. In modelling the
viability scenario, we have made the assumption
that we will be able to refinance external debt and
renew committed facilities as they become due.
In addition to the bottom-up strategic review
process where the prospects of each business line
are reviewed, an assessment has been made of the
potential operational and financial impacts on the
Group of the principal risks and uncertainties outlined
in the following pages. The Directors have also
assessed certain combinations of these principal
risks and uncertainties in a number of severe, but
plausible, scenarios, as well as the effectiveness
of any mitigating actions as set out in the table
opposite. The Directors have assessed climate
change will not have a meaningful impact on the
viability of the Group over the five-year period to
31 December 2027.
The Group has a broad customer base across its
multiple business lines and in its different geographic
regions, and is supported by a robust balance sheet
and strong operational cash flows. The Board
considers that the diverse nature of business
lines and geographies in which the Group operates
significantly mitigates the impact that any of these
scenarios might have on the Group’s viability.
Based on this assessment, the Directors confirm
that they have a reasonable expectation that the
Company will be able to continue in operation and
meet its liabilities as they fall due over the period to
31 December 2027. The statement on going concern
is in the Directors’ Report in Book two, on page 72.
Scenario
Associated principal risks
Description
Regulatory environment change
Customer service issue
Ethical and/or quality breach
IT systems breach
• Industry and competitive landscape
• Customer service
• Regulatory and political landscape
• People retention
• Reputation
• Macroeconomic
• Covid-19
• Industry and competitive landscape
• Customer service
• Business ethics
• People retention
• Reputation
• Macroeconomic
• Covid-19
• Business ethics
• People retention
• Financial risk
• Health, safety and wellbeing
• Reputation
• Macroeconomic
• Covid-19
• Customer service
• People retention
• IT systems and data security
• Reputation
• Macroeconomic
• Covid-19
Failure to identify, understand and respond to
regulatory or political changes results in loss
of revenue, profitability, market share and/or
adversely changes the competitive landscape.
Failure to respond/adapt to a customer service
issue leads to a loss of key customers and
detrimentally impacts reputation.
An ethical and/or quality breach leads to
litigation (including significant fines and
debarment from certain territories/activities),
reputational damage, loss of accreditation and
erosion of customer confidence.
A serious data security/IT systems breach
results in a significant financial penalty and
a loss of reputation among customers.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threePrincipal risks and uncertainties ContinuedContents 45
Operational
1
Reputation
2
Customer service
3
People retention
Reputation is key to the Group maintaining and
growing its business. Reputation risk can occur in a
number of ways: directly as the result of the actions
of the Group or a Group company itself; indirectly
due to the actions of an employee or employees; or
through the actions of other parties, such as joint
venture partners, suppliers, customers or other
industry participants.
A failure to focus on customer needs, to provide
customer innovation or to deliver our services in
accordance with our customers’ expectations and
our customer promise.
The Group operates in specialised sectors and
needs to attract and retain employees with
relevant experience and knowledge in order
to take advantage of all growth opportunities.
Possible impact
• Failure to meet financial performance expectations.
• Exposure to material legal claims, associated costs
and wasted management time.
• Destruction of shareholder value.
• Loss of existing or new business.
• Loss of key staff.
Possible impact
• May lead to customer dissatisfaction and
customer loss.
• Gradual erosion of market share and reputation if
competitors are perceived to have better, more
responsive or more consistent service offerings.
Possible impact
• Poor management succession.
• Lack of continuity.
• Failure to optimise growth.
•
• Loss of talent to competitors and lost market share.
Impact on quality, reputation and customer confidence.
Mitigation
• Quality Management Systems; adherence to these is
regularly audited and reviewed by external parties,
including accreditation bodies.
Mitigation
• Net Promoter Score (‘NPS’) customer satisfaction,
customer sales trends and turnaround time tracking.
• Global and Local Key Account Management
Mitigation
• HR strategy policies and systems.
• Development and reward programme to retain and
motivate employees.
• Risk Management Framework and associated controls
(‘GKAM’/’LKAM’) initiatives in place.
• Succession planning to ensure effective continuation
and assurance processes, including contractual
review and liability caps where appropriate.
• Code of Ethics which is communicated to all staff,
who undergo regular training.
• Zero-tolerance approach with regard to any
inappropriate behaviour by any individual employed
by the Group, or acting on the Group’s behalf.
• Whistleblowing programme, monitored by the Audit
Committee, where staff are encouraged to report,
without risk, any fraudulent or other activity likely
to adversely affect the reputation of the Group.
• Relationship management and communication with
external stakeholders.
2022 update
This risk remains stable compared with 2021. The
Group continues to invest in staff development,
quality systems and standard processes to prevent
operational failures.
• Customer feedback meetings.
• Customer claims/complaints reporting.
of leadership and expertise.
2022 update
This risk remains stable compared with 2021.
2022 update
This risk remains stable compared with 2021.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threePrincipal risks and uncertainties ContinuedContents
4
MacroEconomic
Macroeconomic factors such as a global/market
downturn, inflation, supply chain and logistics
restrictions, materials shortages, and contraction/
changing requirements in certain sectors.
5
Health, safety
and wellbeing
Any health and safety incident arising from our
activities. This could result in injury to Intertek’s
employees, subcontractors, customers and/or any
other stakeholders affected. Wellbeing impacts on
our people resulting from the Covid-19 pandemic
and other similar events.
46
6
Industry and
competitive landscape
A failure to identify, manage and take advantage
of emerging and future risks.
Examples include the opportunities provided by
new markets and customers, a failure to innovate in
terms of service offering and delivery, the challenge
of radically new and different business models; the
failure to foresee the impact of, or adequately
respond to and comply with, changing or new
laws and regulations; a failure to anticipate and
address the operational, strategic, regulatory
and reputational impact of climate change and
environmental factors; and a failure to identify
and take advantage of the impact of post-Brexit
changes to our clients’ operations and supply chains.
Possible impact
•
Impact on revenue.
• Falling market share.
• Shrinking customer base.
Impact on share price.
•
Possible impact
•
• Litigation or legal/regulatory enforcement action
Individual or multiple injuries to employees and others.
(including prosecution) leading to reputational damage.
• Loss of accreditation.
• Erosion of customer confidence.
• Wellbeing – individual or multiple instances of
stress-related issues and/or illnesses, absenteeism,
and related impacts on morale.
Possible impact
• Failure to maximise revenue opportunities.
• Failure to take advantage of new opportunities.
• Lack of ability to respond flexibly.
• Erosion of market share.
•
Impact on share price.
• Sanctions and fines for non-compliance with
new laws, etc.
Mitigation
• We continue to focus on developing business
in new markets and for new customers.
• We continue to focus on innovations in our
service offerings.
• We continue to monitor trends and customer pipelines.
• We conduct regular strategic and business line
reviews, including budget forecasting.
• We continue to monitor the impacts of external risk
factors, and have access to data and analysis from
our external advisers.
Mitigation
• Quality management and associated controls,
including safety training, appropriate PPE (Personal
Protective Equipment), Health and Safety policies
(including due diligence on sub-contractors), meetings
and communication.
• Avoiding fatalities, accidents and hazardous
situations is paramount. It is expected that Intertek
employees will operate to the highest standards of
health and safety at all times and there are controls
in place to reduce incidents.
• Business continuity planning.
• Employee wellbeing programme.
Mitigation
• GKAM and LKAM initiatives in place.
• Diversification of customer base.
• Focus on new services and acquisitions.
• Tracking new laws and regulations.
• Regular strategic and business line reviews.
• Development of ATIC-selling initiatives.
• NPS customer research to understand customer
satisfaction.
• Using innovation to respond to the Covid-19
pandemic.
2022 update
This risk remains stable compared with 2021.
2022 update
This risk remains stable compared with 2021.
2022 update
This risk remains stable compared with 2021.
The Group continues to invest in innovation and to adapt
our service delivery to meet our clients’ changing needs.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threePrincipal risks and uncertainties ContinuedContents
47
8
Covid-19
The risk caused by the ongoing coronavirus
pandemic. The virus is a potential risk to: (1) the
health and safety of our people; (2) the ability of our
and our customers’ businesses to operate normally;
and (3) global supply chains and the flow of goods
and services.
Possible impact
• There is a health and safety risk to our people who
•
come into contact with confirmed cases.
In affected areas, there is a risk that the ability of our
people to work as normal is impacted by mandatory
health and safety restrictions, including quarantine
and travel restrictions in certain cases.
• There is a risk that the ability of our people to perform
field-based work (audits and inspections) continues
to be affected by control and prevention measures
that we and our clients are taking, or are subject to.
In affected areas, there is risk of disruption to our
normal operations, both as a consequence of the
issues faced by our people and of the impact to our
clients’ operations and production levels.
• There is a risk that an ongoing situation could
•
continue to disrupt global supply chains, which could
lead to a need to refocus our service offering or
delivery locations to align optimally with customer
requirements and to remain competitive.
• There is a risk that our 2023 performance will be
affected by the disruption to the supply chains of
our clients and any impact it may have on global
trade activities.
Mitigation
• We are closely monitoring our people’s health, safety
and security and relevant regulatory requirements.
• We have implemented, and continually revise, the
Group’s Covid-19 Health and Safety Policy, which
covers extensive hygiene control and prevention
measures for our office and field-based people.
• We have made changes to operational procedures
to redirect work to Intertek facilities in unaffected
locations.
• We are engaging closely with our customers to
support their needs.
• We have working groups at the Group, regional
and local levels to monitor the situation and put
appropriate mitigation action and continuity plans
in place.
2022 update
We believe this risk remains similar to the prior year.
Although global vaccination programmes and other
factors (such as rapid mass testing and improved
treatments and therapies) have reduced this risk during
2022, there remains significant uncertainty over new
variants and the potential for ongoing government
restrictions.
We continue to work closely with our clients to prioritise
the health and safety of our and their people and to
maximise business continuity.
9
Contracting
Agreeing unfavourable terms with customers
and/or suppliers as a result of not following
agreed contract review processes, and/or failing
to negotiate appropriate terms.
Possible impact
• Margin−decretive work.
• Onerous liabilities and exposures.
• Non-optimised pricing.
• Financial exposures due to claims and litigation.
Mitigation
• Any deviations from our standard contract terms are
subject to legal review and approval, and all contracts
must be approved in line with our Authorities Grid
(which sets out approval limits based on contract
values and other relevant factors).
• We continue to operate our claims notification
procedure, including claims management and insurer
liaison where needed.
• Both our contracting and claims processes are
supported by training programmes for relevant staff,
and the use of relevant systems and databases.
7
IT systems and
data security
Systems integrity: major IT systems integrity issue,
or data security breach, either due to internal or
external factors such as deliberate interference
or power shortages/cuts, etc.
Systems functionality: a failure to define the right
IT strategies, maintain existing IT systems or
implement new IT systems with the required
functionality and which are fit for purpose, in each
case to support the Group’s growth, innovation and
competitive customer offering.
Data security: a failure to adequately protect the
Group’s confidential information, customer
confidential information or the personal data of the
Group’s employees, customers or other stakeholders.
Possible impact
• Loss of revenue due to down time.
• Potential loss of sensitive data with associated legal
implications, including regulatory sanctions and
potential fines.
• Potential costs of IT systems' replacement and repair.
• Loss of customer confidence.
• Damage to reputation.
• Loss of revenue/profitability if we fail to adopt an IT
investment strategy which supports the Group's
growth, innovation and customer offering.
Information systems policy and governance structure.
Mitigation
•
• Regular system maintenance.
• Backup systems in place.
• Disaster recovery plans that are constantly tested
and improved to minimise the impact if a failure does
occur.
• Global Information Security policies in place (IT, Data
Protection, CyberSecurity).
• Adherence to IT finance systems controls (part of
Core Mandatory Controls ('CMCs')).
• Adherence to IT general controls.
•
• Processes to ensure compliance with GDPR.
Internal and external audit testing.
2022 update
This risk remains stable compared with 2021.
2022 update
This risk remains stable compared with 2021.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threePrincipal risks and uncertainties ContinuedContents
Legal and Regulatory
10
Regulatory and
political landscape
A failure to identify and respond appropriately to
a change in law and/or regulation, or to a political
decision, event or condition which could impact
demand for the Group’s services or the Group’s
ability to grow, innovate and/or provide a
competitive customer offering in any existing
or new industry sector or market.
Possible impact
• Loss of revenue, profitability and/or market share.
Increase to costs of operations, reduction in
•
profitability.
• Reduction in the attractiveness of investment in
specific businesses, sectors or markets and/or
adverse change in the competitive landscape.
Mitigation
• Monitoring of regulatory environment and political
Mitigation
• Annual Code of Ethics training and sign-off
developments.
• Analysis of impact of regulatory and political changes
on operational Standard Operating Procedures
('SOPs') and Group policies.
• Membership of relevant associations, e.g. TIC Council
with related advocacy and liaison activities, including
in relation to developing climate-related or
environmental regulations.
requirement.
• Whistleblowing programme, monitored by the Group
Risk Committee, where staff are encouraged to
report, without risk, any fraudulent or other activity
likely to adversely affect the reputation of the Group.
• Enhanced processes for engagement with suppliers
48
Financial
11
Business ethics
12
Financial risk
Non-compliance with Intertek’s Code of Ethics
(‘the Code’) and/or related laws such as anti-bribery,
anti-money laundering, and fair competition
legislation. Non-compliance could be either
accidental or deliberate, and committed either by
our people or sub-contractors who must also abide
by the Code.
Risk of theft, fraud or financial misstatement by
employees. On acquisitions or investments, the
financial risk or exposure arising from due diligence,
integration or performance delivery failures.
Possible impact
• Litigation, including significant fines and debarment
Possible impact
• Financial losses with a direct impact on the
from certain territories/activities.
• Reputational damage.
• Loss of accreditation.
• Erosion of customer confidence.
•
Impact on share price.
bottom line.
• Large-scale losses can affect financial results.
• Potential legal proceedings leading to costs and/or
management time.
• Corresponding loss of value and reputation could
result in funding being withdrawn or provided at
higher interest rates.
• Possible adverse publicity.
Mitigation
• The Group has financial, management and systems
controls in place to ensure that the Group’s assets
are protected from major financial risks.
• Adherence to Authorities Grid (which sets approval
limits for financial transactions).
• Stringent controls on working capital and cash
collection.
and third parties.
• Legal, financial and other due diligence on M&A and
• Zero-tolerance approach with regard to any
other investments.
inappropriate behaviour by any individual employed by
the Group, or acting on the Group’s behalf.
• The Group employs local people in each country who
are aware of local legal and regulatory requirements.
There are also extensive internal compliance and
audit systems to facilitate compliance. Expert advice
is taken in areas where regulations are uncertain.
• The Group continues to dedicate resources to ensure
compliance with the UK Bribery Act and all other
anti-bribery legislation, and internal policy.
• Monitoring adherence to our CMCs and tracking of
remediations by our compliance and finance controls
teams and using our framework of risk committees.
• A detailed system of financial reporting is in place to
ensure that monthly financial results are thoroughly
reviewed. The Group also operates a rigorous
programme of internal audits and management
reviews. Independent external auditors review the
Group’s half-year results and audit the Group’s annual
financial statements.
2022 update
This risk remains stable compared with 2021.
2022 update
This risk remains stable compared with 2021.
Ongoing annual confirmations ensure that staff verify
compliance with the Code.
Local compliance officers perform due diligence on
sub-contractors to check that they have signed the
Group’s Code.
During 2022, 91 (2021: 112) non-compliance issues
were reported through the whistleblowing hotline and
other routes. All were investigated, with 24 (2021: 19)
substantiated and corrective action taken.
2022 update
This risk remains stable compared with 2021.
We continue to review and update the CMCs on an
annual basis and use them for year-end compliance
certification.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
TCFD statement
Our TCFD journey
49
We believe that, as a sustainable business and a leading
provider of sustainability solutions to more than 400,000
companies, Intertek has an important role to play in taking
action on climate change and supporting the transition to
a low-carbon economy – both for our clients and in our own
value chain.
We have set ambitious science-based targets to get to net
zero carbon emissions by 2050. We are also committed to
total transparency on the effect of climate change and the
risks and opportunities of decarbonisation on our operations,
strategy and financial planning, including by implementing
the recommendations of the Taskforce on Climate-related
Financial Disclosures ('TCFD') in full.
Putting climate change and decarbonisation in context
Climate change policies, disclosure
requirements and public, consumer and
investor pressure have led to a 'race to net
zero' by governments and corporations, with
the aim being decarbonisation of the global
economy in line with Paris Agreement goals
to limit global warming.
current rate of progress, is that achieving net
zero within the Paris Agreement timeframe will
require the development and use of new carbon
capture and storage technologies, together
with breakthrough innovations to accelerate
the reduction of carbon emissions linked to
manufacturing, transportation and consumption.
Decarbonisation to a point of net zero carbon
emissions will involve economic, political and
societal changes. The key to achieving it lies
in energy transition – a shift from reliance on
carbon-emitting fossil fuels to renewables and
green energy sources, with the significant
changes in energy infrastructure that involves.
It will require a reduction in the carbon footprint of
global activities: transport and travel; facilities and
construction; supplies consumed; and goods and
services produced. The likelihood, based on the
Conversely, if decarbonisation goals are not met,
the effects of climate change will increase and
extreme weather events will be more likely.
Governments and corporations will need to
consider mitigating the risks of this outcome by
ensuring that their energy, manufacturing and
supply networks are resilient and secure.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents TCFD Continued
Our TCFD journey
50
2018
Systemic CO2 emission
collection in all sites/
operations
2022
Country specific targets
and action plans to
reduce emissions
2022
CO2 reduction targets for all
employees included in yearly
compensation
2022
Compliant with TCFD
recommendations
2017
First Group-wide
GHG emission
reduction target set
2020
Voluntary disclosure
against TCFD
recommendations
2021
Commitment to net
zero by 2050
2022
Systemic monthly performance
management of emission reductions
and action plans
Our TCFD compliance statement
The TCFD requires the disclosure of information
aligned to its core four elements: governance,
strategy, risk management, and metrics and
targets. The TCFD aims to improve the disclosure
of climate-related risks and opportunities and
provide stakeholders with the necessary information
to undertake robust and consistent analyses of the
potential financial impacts of climate change.
We recognise the value that the recommendations
bring and continue to align and enhance our
climate-related disclosures.
We set out below our climate-related financial
disclosures consistent with all the TCFD
recommendations and recommended disclosures.
By this we mean the four TCFD recommendations
and the 11 recommended disclosures set out in
Figure 4 of Section C of the report entitled
'Recommendations of the Task Force on Climate-
related Financial Disclosures' published in June
2017 by the TCFD, also taking into account the
TCFD 'Guidance for All Sectors'.
Our TCFD disclosures are set
out in five sections:
>
>
>
>
>
Section 1: our governance of climate-
related risks and opportunities
Section 2: how we consider climate
change in our strategy
Section 3: our climate-related risk
management approach
Section 4: our climate-related metrics
and targets
Section 5: our climate change
methodology and approach
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents TCFD Continued
Section 1: Governance
51
Section 2: Strategy
TCFD Recommended Disclosures
Further information
TCFD Recommended Disclosures
Further information
a) Describe the Board’s oversight of climate-related
risks and opportunities.
• Governance Structure (Book two, page 37).
• Governance and Sustainability (Book two, page 51).
b) Describe management’s role in assessing and
managing climate-related risks and opportunities.
• Internal control and risk management (Book two,
pages 50 and 76).
1 a) Our Board’s oversight of climate-related risks and opportunities
Our Board of Directors is responsible for the oversight of climate-related risks and opportunities. Climate-
related risks are integrated into every Board agenda as part of the Board’s review of risks and our integrated
risk, control and compliance approach. Climate-related issues are considered as part of the Board’s strategic
review sessions and reflected in the Board’s strategic review and guidance.
The Board takes emerging and systemic climate-related risks and opportunities into account:
(1)
when considering the Group Risk Footprint and our internal controls/risk management policies
at each Board meeting; and
(2) in reviewing the Group’s Principal Risks and in the risk modelling that feeds into the longer-term
viability statement.
The Group’s Head of Sustainability reports to the Board on our climate-related risks and opportunities as part
of an annual in-depth Intertek Total Sustainability review. In addition, the Board receives specific updates on
our TCFD approach and progress during the year. The Board monitors and oversees our progress against our
science-based targets and our action plans to reduce carbon emissions.
1 b) Management’s role in identifying, assessing and managing climate-related risks
and opportunities
We believe that assessing and managing climate-related risks and opportunities is an integral part of our
overall integrated risk management approach. Our framework of regional, divisional and functional risk
committees considers climate-related risks and opportunities and identifies and implements appropriate
action plans. This creates an awareness and ownership of climate-related risks and opportunities within
our operational, HR, compliance, finance and insurance leadership.
In addition, climate-related risks and opportunities are identified, managed and tracked by:
• our Net Zero Steering Committee (whose members include our Group CEO, Group CFO, Head of Sustainability,
Head of Finance – Sustainability and Group General Counsel) which is working on our detailed net zero action
plans and manages our GHG emissions plans and targets;
• our Beyond Net Zero Steering Committee (whose members include our Group CEO, Head of Sustainability,
SVP Corporate Development Group, EVP – Marketing & Communications, Director Group Communications
and Group General Counsel), which has oversight of our Total Sustainability agenda including internal and
external climate-related actions over and above our GHG and net zero commitments; and
• our specific CEO-led working group on TCFD/climate-related risks and opportunities.
a) Describe the climate-related risks and
opportunities the organisation has identified
over the short, medium, and long term.
• Principal risks and uncertainties (page 43).
• Our climate change methodology and approach
(page 57).
b) Describe the impact of climate-related risks and
opportunities on the organisation’s businesses,
strategy, and financial planning.
c) Describe the resilience of the organisation’s
strategy, taking into consideration different
climate-related scenarios, including a 2°C or
lower scenario.
• Strategic Report; Our business model (pages 14
to 23).
• Sustainability Report (Book two).
• Financial Report (Book three).
• Strategic Report; Our business model (pages 14
to 23).
• Sustainability Report (Book two).
• Financial Report (Book three).
At the high level, our target is to become a net zero emissions business by 2050 while mitigating the physical
impact of climate change on our operations and supporting our clients with sustainability solutions.
Innovative sustainability services have been at the core of our business and strategy for over 100 years.
Today’s 'race to net zero' by governments and corporations is beneficial to Intertek given our investments in
sustainability, including our operational sustainability solutions; our carbon emissions certification, CarbonClear;
our ESG disclosures verification; and our corporate sustainability certification, TSA. Ongoing dependency on
traditional oil and gas, and the significant investments required to scale up renewable energy, will mean our
Industry Services businesses should benefit from traditional energy investment and the parallel developments
in the renewables space – and our differentiated World of Energy value proposition and our total energy
expertise position us strongly to take advantage of the global energy transition required to get to net zero.
The world will face difficulties in meeting Paris Agreement targets and addressing climate change unless:
all companies, public and private, commit to reduce carbon emissions to net zero; significantly increased
investments are made in renewables; and there is breakthrough innovation to accelerate carbon emission
reduction and facilitate carbon storage and capture. This negative outcome should lead to increased demand
for our services as it will lead to an increased focus on developing low-carbon products and other innovations
and technologies that will reduce emissions, including increased investment in carbon capture and storage.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 52
TCFD Continued
2 a) Our climate-related risks and opportunities
Based on our supply and demand model and decarbonisation scenarios (details of which are set out in section 5),
our view of Intertek’s climate-related risks and opportunities is as follows.
Climate-related opportunities
Opportunity area
Description of opportunities
Energy
transition
The key question for our energy-related businesses is what the risks and opportunities
of a transition to lower carbon/renewable energy will look like, and over what timeframe.
The world will be dependent on traditional oil and gas for longer than people think: there
have been under-investments in oil and gas exploration since 2015; there is structural
under-investment in alternative energy sources and renewables will take time to scale,
creating risks for governments and economies in moving away too quickly from traditional
energy sources.
This will require our clients to make incremental investments in traditional oil and gas
infrastructure, exploration and production. Our Industry Services businesses should
therefore benefit over the next 20 to 25 years both from traditional energy investment
and the parallel developments in the renewables space.
Our Caleb Brett business should benefit from the recovery of global demand for oil
and gas to pre-Covid-19 consumption levels in the short-term, and in the medium- to
long-term continue to benefit from an increase in the production and consumption of
oil-related products as well as the development/growth of greener fuels – biofuels and
synthetic. Today, only 9% of global energy is from renewable sources and our clients will
need to make significant investments in traditional oil and gas if they are to continue to
meet the growing global energy demand.
The carbon capture and carbon removal technologies which will be required to achieve net
zero targets are currently at an early stage of development and it is likely that increased
investments will be required to accelerate their production and availability: this should
benefit our engineering-based inspection businesses within Industry Services.
The energy transition that certain of our traditional oil and gas clients face as they move
to being total energy providers underlines the importance of our differentiated World of
Energy value proposition. Intertek’s range of energy expertise is able to support our
clients across the full World of Energy spectrum: from traditional oil and gas, petroleum
refining and distribution, petrochemicals and power generation to nuclear power, solar,
biofuels, tidal, wave and wind power. This gives Intertek a high-level, cross-sectional view
of energy industry topics and trends that we believe will position us strongly to take
advantage of current and future business development linked to the energy transition.
Opportunity area
Description of opportunities
Carbon
footprint
transition
For our Products businesses, the risks and opportunities of decarbonisation will be linked
to our clients’ transition to lower-carbon logistics, manufacturing/production and supply
chain networks.
We expect consumer spending on products to continue to increase and the number
of SKUs produced to also increase. An increasing consumer and regulatory focus on
sustainability will lead to changes in demand for products with lower carbon footprints.
Equally, manufacturers’ own sustainability goals will lead them to seek raw materials
with lower carbon footprints and to develop lower carbon footprint products.
We believe that corporations will face difficulties in achieving their net zero targets given
the financial, organisational and practical complexities of transitioning to low-carbon
footprint operations. We therefore expect the demand for existing products to stay high
for longer. Given the difficulties in getting to net zero without R&D and investments in
logistics and supply chains, our Products businesses will benefit from higher corporate
investments in R&D to design low-carbon products at the start of the value chain, and
from investments in supply chain relocations closer to home markets to reduce carbon
footprints and increase resilience.
Policy
Climate-related laws and regulations will increase over time.
In the short term, governments are likely to limit policies which require mandatory behavioural
changes to the industry sectors which are the most critical to decarbonisation: energy;
infrastructure; and transportation. It is likely that corporates in other industry sectors will
be encouraged to decarbonise by increasing disclosure and transparency requirements.
The regulatory approach over the medium to longer-term will change depending on
companies’/countries’ success in meeting Paris Agreement targets and regulation will
become less voluntary and more mandatory over time if those targets are likely to be
missed based on existing behaviours.
We expect to benefit from increased regulation to drive investment and product
development by our clients in the energy, infrastructure and transportation sectors.
We expect our Business Assurance businesses to benefit from an increase in supplier
audit and management solutions as corporations seek to address their Scope 3/supply
chain carbon emissions.
ESG disclosure requirements are likely to increase in response both to new regulations and
disclosure standards and to increasing investor and stakeholder expectations. We expect
this to lead to increased demand for our ESG disclosure/verification services.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
53
TCFD Continued
Climate-related risks
Risk area
Description of risk
Physical
impacts
We consider that there are three types of possible physical impacts:
1. Direct physical impacts, where the increased frequency and/or severity of extreme
weather events causes an increased incidence of disruption to our own operations/
supply chain/transportation networks;
2. Client physical impacts, where the extreme weather events cause disruption to our
clients’ operations and therefore changes to client demand – or the geographic location
of client demand – for our services; and
3. Economic physical impacts, where temperature increase and extreme weather events
reduce economic activity, leading to a fall in demand for our services in line with fall in
consumer demand/client production.
Based on our natural catastrophe experience and modelling, and because of the
capital-light nature of our operations and our ability to redirect work within our own
network, we believe that the impacts of extreme weather events to Intertek are likely
to be local and not material at the Group level.
Our World of Energy businesses continue to scale up investments in strategic growth areas driven by
climate-related factors, such as:
• An increase in total energy demand driven by GDP and population growth.
• The need to address structural underinvestment in traditional oil and gas as renewables lack scale.
• Technology and infrastructure investments needed to build scale renewable infrastructure.
• The significant investments and innovations required to meet net zero pathways, including developments
in hydrogen, synthetic fuels, carbon capture and carbon storage.
Our strategy includes M&A investments such as our acquisition of Clean Energy Associates LLC. which has
enabled us to expand our sustainability service offering in the fast-growing quality assurance market for
solar energy and energy storage. It also includes organic innovations such as Intertek Hydrogen, Intertek
CarbonClear and CarbonZero, and Intertek Green R&D.
Our climate-related risks and opportunities assessment also feeds directly into our wider strategy, portfolio
and financial planning, including our planning on:
• climate-change mitigation activities and our net zero action plans; and
• the location of our facilities.
We believe the impact of climate-related risks and opportunities is as follows:
2 b) The impact of climate-related risks and opportunities on our businesses, strategy
Timeframe
Scenario
Climate-related opportunities
Short
Medium
Long
RCP4.5
RCP8.5
and financial planning
Intertek has been a global thought and innovation leader in sustainability services for decades, and
sustainability services are core to our global business. We help customers across all aspects of sustainability,
covering all major industries, with end-to-end sustainability solutions.
Climate-related opportunities are one part of our overall sustainability strategy. At the high level, we believe
that the actions which companies and corporations will need to take to transition to a low-carbon economy
will be an opportunity for us and will accelerate the demand for our ATIC solutions, including:
• our climate-related operational sustainability services (such as energy efficiency, carbon footprint
or zero waste to landfill certifications);
• our corporate sustainability solutions (where we help corporations to establish and validate the
effectiveness of their own sustainability programmes); and
• our Intertek ESG Solutions (where we independently verify our clients’ sustainability reporting
and disclosures).
We continue to develop innovative ATIC service offerings to support our clients’ low-carbon transition aims
and to enable them to comply with the increasing regulatory requirements relating to sustainability and ESG.
Transition impacts
• Energy transition
• Carbon footprint
transition
Policy impacts
Climate-related risks
Physical impacts
Key: ◊ – ◊◊◊ = low – high impact
* Scenario sensitivity
◊
◊
◊
◊◊
◊◊
◊◊
◊
◊◊◊
◊◊◊
◊◊◊
◊◊
*
*
*
Financial
impact
See note 1
*
See note 2
Note 1: Our pre-Covid (2014 – 2019) organic revenue CAGR was c.3%. Sustainability/ESG services were a driver of that revenue growth.
Post-Covid, we expect the Group revenue growth from Sustainability/ESG services to accelerate.
Note 2: In order to assess our physical impact risk, we have worked with Willis Towers Watson ('WTW') to carry out a portfolio exposure
assessment based on scenario modelling supported by WTW’s Climate Diagnostic technology platform. For this purpose, our portfolio includes
985 sites and associated assets and revenues. The assessment evaluated the percentage of our portfolio that is exposed to a material level of
climate-related risk over four time periods (today; 2030; 2050 and 2100) and under two scenarios ( RCP4.5 and RCP8.5) – see Figure 1 and 2.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents TCFD Continued
Figure 1: Physical risk exposure under an RCP4.5 scenario:
% of portfolio (assets & revenues) exposed to physical impact risks
54
53% of portfolio exposed to
at least 5 heavy rainfall days
(days with more than 30mm
rainfall) per year by 2050
53% of portfolio exposed
to at least 80 heatwave
days (temperature over
30ºC) per year by 2050
56%
53%
46% 48%
58%
53%
50%
40%
2022
2030
2050
2100
Climate Scenario:
RCP4.5 (2-3ºC)
16% of portfolio in
river flood zones (1%
probability of flooding or
more in a year) by 2050
9% of portfolio
exposed to at least
4 months of drought
per year by 2050
8% of portfolio
exposed to fire
weather conditions
for at least 80 days
per year by 2050
5% of portfolio exposed
to risk of significant
flooding from storm
surge events and sea
level rise by 2050
Small and largely unchanged portion of portfolio
exposed to severe windstorms generating damaging
gusts (either from tropical cyclones i.e. hurricanes or
extratropical cyclones i.e. winter storms) by 2050
15% 16% 15%
12%
15%
12%
9%
6%
14%
8% 8% 8%
4% 5% 5% 5%
2% 3% 3% 3%
2% 2% 2% 2%
Precipitation
Heat
River Flood (Defended)
Drought
Fire
Sea Level Rise
Tropical Cyclone
Extratropical Cyclone
Figure 2: Physical risk exposure under an RCP8.5 scenario:
% of portfolio (assets & revenues) exposed to physical impact risks
60% of portfolio exposed
to at least 80 heatwave
days (temperature over
300C) per year by 2050
56% of portfolio exposed to
at least 5 heavy rainfall days
(days with more than 30mm
rainfall) per year by 2050
70%
60%
52%
40%
60%
56%
50%
46%
22% of portfolio to
at least 4 months of
drought per year by 2050
41%
22%
2022
2030
2050
2100
Climate Scenario:
RCP8.5 (4ºC)
16% of portfolio in
river flood zones (1%
probability of flooding or
more in a year) by 2050
10% of portfolio
exposed to fire
weather conditions
for at least 80 days
per year by 2050
5% of portfolio exposed
to significant risk of
flooding from storm
surge events and sea
level rise by 2050
Small and largely unchanged portion of the total value
exposed to severe windstorms generating damaging
gusts (either from tropical cyclones i.e. hurricanes or
extratropical cyclones i.e. winter storms) by 2050
9%
6%
16% 16% 16%
12%
16%
8% 9% 10%
4% 4% 5% 5%
2% 3% 3% 3%
2% 2% 2% 2%
Heat
Precipitation
Drought
River Flood (Defended)
Fire
Sea Level Rise
Tropical Cyclone
Extratropical Cyclone
d
e
s
o
p
x
e
o
i
l
o
f
t
r
o
p
f
o
e
g
a
t
n
e
c
r
e
P
80%
60%
40%
20%
0%
d
e
s
o
p
x
e
o
i
l
o
f
t
r
o
p
f
o
e
g
a
t
n
e
c
r
e
P
80%
60%
40%
20%
0%
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
55
TCFD Continued
Physical risk assessment
The assessment shows that our broad geographic footprint and capital-light earnings model – covered
in more detail in 20C – is an advantage for long-term climate resilience. Nevertheless, it does indicate an
increased physical impact exposure to our portfolio, varying by type of climate-related extreme weather
event, under both the RCP4.5 and RCP8.5 scenarios:
• a low to medium increase by 2050 in exposure to chronic (extended, non-localised) weather events – heat,
precipitation, drought, sea level rise; and
• a low increase by 2050 in exposure to acute (localised, one-off) weather events – river floods, fire, tropical
and non-tropical storms.
Assessing the impact of chronic weather events
It is difficult to assess the physical impact of chronic weather events as these are likely to be regional or
global in nature but can be largely or fully addressed with systemic risk mitigation actions at the Intertek site/
operational level:
recent experience, in FY17 hurricanes Harvey and Irma impacted the operations of our clients in southern
regions of the USA during a three-month period, in turn impacting our business. These two operational
disruptions reduced our revenue performance by £5m at constant currency over the period August to October
2017, negatively impacting our Products, Trade and Resources divisions. Over the five-year period to date, our
operations have been impacted by c.ten extreme weather events.
2 c) Our organisational resilience to the risks of climate-change and decarbonisation scenarios
We believe our operations and strategy have a high degree of resilience to the risks of climate change under
both an RCP4.5 and RCP8.5 scenario:
• Our extensive network – over 1,000 labs in over 100 countries – means that we are well positioned to take
advantage of any climate-related changes in supply chains (either changes to suppliers, to the raw materials
being supplied or to the geographic location of supply chains).
• Our products inspection and assurance businesses are flexible as they use field-based inspectors and
auditors and we can deploy personnel/sub-contractors as required.
• Our client-base of over 400,000 clients is diverse, with no material dependencies, which also de-risks
geographic changes in our points of service delivery.
Physical risk (chronic
weather events)
Impact on business
Mitigations
• Our capital-light earnings model de-risks us from climate-related changes to our clients’ supply chains and
physical impacts of climate-change as we have a low cost of market entry and exit.
• We are able to redirect work within our own network in order to mitigate the impact of climate-related
disruptions.
• We do not anticipate a material impact of climate-related policies directly on our business. As a professional
services provider, we do not operate in a sector which is likely to be a key focus for mandatory decarbonisation
behavioural changes. Our broad geographic footprint de-risks us from the impact of national regulations. Our
capital-light model mitigates our exposure to climate-related policies.
Precipitation
• Property damage and business disruption • Insurance cover
• Add identified climate-related risk into our
business continuity planning for sites with
predicted exposure
• Physical/structural protections for sites
with predicted exposure
Heat
Drought
• Productivity changes as severe heat
affects people and/or equipment
• Cost increases linked to an increased
• Add identified climate-related risk into our
business continuity planning for sites with
predicted exposure
requirement for air conditioning/cooling
• Increase energy efficiency/use of solar/
renewable energy
• Operational impact from water scarcity
• Changes to demand for our services linked
to changing consumption patterns,
population migration or conflict
• Add identified climate-related risk into our
business continuity planning for sites with
predicted exposure
• Focus on reducing water usage/efficiency
Sea level rise
• Property damage and business disruption • Insurance cover
• Add identified climate-related risk into our
business continuity planning for sites with
predicted exposure
• Physical/structural protections for sites
with predicted exposure
Assessing the impact of acute weather events
The likely impact of an acute weather event is a loss of revenue due to a shutdown of our facilities. It is difficult
to provide a precise estimate of the financial impact, which depends on factors including the severity of the
event, the geography affected and our ability to redistribute work, and the duration of the shutdown.
Our assessment reveals a minimal increase in expected portfolio exposure to acute weather events, and we
therefore expect the incidence and financial impact of such acute events to be similar to today. Based on
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 56
TCFD Continued
Section 3: Risk management
Section 4: Metrics and targets
TCFD Recommended Disclosures
Further information
TCFD Recommended Disclosures
Further information
a) Describe the organisation’s processes for
identifying and assessing climate-related risks.
• Internal control and risk management (Book two,
pages 50 and 76).
b) Describe the organisation’s processes for
managing climate-related risks.
• Internal control and risk management (Book two,
pages 50 and 76).
c) Describe how processes for identifying, assessing,
and managing climate-related risks are integrated
into the organisation’s overall risk management.
• Internal control and risk management (Book two,
pages 50 and 76).
3 a) Our process for identifying and assessing climate-related risks
“Sustainability risk” – the risk of extreme weather events having a physical impact on our business and
operations – was specifically identified as a standalone Group principal risk in 2021 and reflected accordingly
in our viability statement and going concern analysis.
In 2022, we have further developed our processes for identifying and assessing climate-related risks, within
our risk committees and separately using the supply-and-demand model we have built for our World of Energy
businesses and our work with WTW to model the exposure of our portfolio to the physical impacts of climate
change. The most significant insight from our work with WTW was that the exposure of our portfolio to acute
weather events is expected to increase only very marginally in the period to 2050, with any financial impact
falling well below the threshold for materiality. On that basis, we have removed "Sustainability" as a Group
principal risk in 2022. We will keep this under review as part of our integrated risk management process.
3 b) How we manage climate-related risks
Climate-related risks, and the related mitigation action plans, are reviewed at least quarterly by the Board
and by our framework of regional, divisional and functional risk committees and our Group Risk Committee.
The risk of physical impacts of climate change on our sites are also considered by a cross-functional group
including members of our finance, insurance, risk and sustainability teams. The portfolio exposure modelling
we have done with WTW allows us to assess, on a site-by-site basis, the changing likelihood and impact of
specific climate events (such as drought, precipitation, flooding and fire) under both the RCP4.5 and RCP8.5
scenario in the short, medium and long-term. We will use the output of this model in our opportunity and risk
mitigation planning, and in local site business continuity planning.
3 c) Integration into our overall risk management
Our climate-related opportunities are reviewed as part of our overall budget, innovation, M&A, customer
insight and other processes. At the strategic level, the supply and demand model we have developed to look
at how the needs of our customers across our different businesses are likely to be affected by decarbonisation
allows us to assess how that is likely to affect their need for our end-to-end TQA services across all points of
their logistics, manufacturing/production and supply chain networks.
a) Disclose the metrics used by the organisation to
assess climate-related risks and opportunities in line
with its strategy and risk management process.
b) Disclose Scope 1, Scope 2, and, if appropriate,
Scope 3 GHG emissions, and the related risks.
c) Describe the targets used by the organisation to
manage climate-related risks and opportunities and
performance against targets.
• Environment section (Book two, pages 24 to 29).
• Environment section (Book two, pages 24 to 29).
• Environment section (Book two, pages 24 to 29).
We use carbon-emissions target and net zero target dashboards by country to drive our climate-change/net
zero progress and to track the effectiveness of our climate-related action plans.
We have made several climate-related public commitments, on our own and with other organisations. Central to
these is to set and meet science-based targets and we have joined the global movement of 'Business Ambition
for 1.5˚C’ and the UN Race to Zero campaign. The Science Based Target initiative ('SBTi') defines and promotes
global best practice in science-based target setting. We have applied the 'SBTi Criteria and Recommendations'
guidance to our policies and Greenhouse Gas accounting standards in the development of our new science-
based targets and have applied for our targets to be validated.
Intertek publicly reports on its Scope 1, 2 and 3 GHG emissions and the carbon intensity of our operational
emissions per employee and by revenue. Progress against targets is disclosed in the Annual Report, as well
as in other relevant publications. Our measurement and reporting is aligned to the GHG Protocol Corporate
Accounting and Reporting Standard (2015) and the recommendations of the TCFD. As required, we report
under the Companies Act 2006 (Strategic Report and Directors’ Reports) Regulations and we apply the 2019
UK Government Environmental Reporting Guidelines, including the Streamlined Energy and Carbon Reporting
Guidance. Further details can be found in Book two, pages 24 to 29.
In 2022, we changed the operation of our annual incentive plan to align our annual incentive framework
with progress against our ESG and climate-related goals. Reflecting on the Group’s wider purpose of bringing
quality, safety and sustainability to life, the Remuneration Committee considered it was appropriate to add an
ESG element (with a 15% weighting) based on performance against a carbon emissions reduction target.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 57
TCFD Continued
Section 5: Our climate change methodology and approach
The demand for our services depends on the supply of, and demand for, our clients’ products and services and
their need for our TQA services at specific risk points in their logistics, manufacturing and supply chains.
To assess the impact of global decarbonisation on Intertek and our potential climate-related risks and
opportunities we have built a bottom-up supply and demand model for our World of Energy (Caleb Brett
and Moody) businesses which considers how the supply and demand of our clients’ products and services,
and therefore their need for Intertek’s services, is likely to change in line with two decarbonisation scenarios
that are aligned to the Intergovernmental Panel on Climate Change ('IPCC') Representative Concentration
Pathways ('RCPs'):
• Intermediate (RCP4.5): Characterised by slowly declining emissions, this pathway assumes climate
policies will be invoked to limit emissions, resulting in likely global temperature rise of 2–3°C by 2100.
• High (RCP8.5): Characterised by rising emissions, this pathway adheres to the current trajectory
and assumes no additional efforts are made to constrain emissions, leading to likely global temperature
rise of >4°C by 2100.
We have also used these two scenarios to evaluate Intertek’s climate-related physical risks.
We have considered impacts over the short term (0-2 years), medium term (2 years – 2030); and long term
(2030 – 2050).
In assessing materiality, we have considered both financial impacts on us and other considerations such as the
importance of key climate-related topics to our clients and other stakeholders. For financial impacts, we have
applied a materiality threshold of £20.8m, aligned with the materiality threshold in our financial statements.
We have considered the materiality of risks on a 'net risk' basis i.e. taking into account relevant risk mitigations
and opportunities that may be linked to those risks.
Based on our view of global decarbonisation and the nature of our businesses and services, we have divided
the impacts of climate-related risks and opportunities on Intertek’s operations, activities and earnings model
into three categories:
• Transition impacts: the impact of transitioning to low-carbon economies and societies. We further divide
these into: energy transition impacts (the impact of transitioning to renewables and green energy sources);
and carbon footprint transition impacts (the impact of reducing the carbon footprint of global activities
including logistics, manufacturing/production and supply chains);
• Policy impacts: the impact of climate-related laws or regulations, or policies intended to drive
a decarbonisation agenda; and
• Physical impacts: the impact of extreme weather events on our and/or our clients’ facilities and operations.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 58
Book one
Book two
Book three
Section 172 statement
Our Science-based Customer Excellence
Advantage creates sustainable growth.
For all.
In accordance with their duties under section 172(1) of the
Companies Act 2006, the Board of Directors individually and
collectively confirm that during the year under review, they
have acted in a way that they consider, in good faith, is most
likely to promote the long-term success of the Company for
the benefit of its members as a whole, whilst having due
regard to the matters set out in section 172(1) (a) to (f) of
the Companies Act 2006, being:
a) the likely consequences of any decision in the long term;
b) the interests of the Company’s employees;
c)
the need to foster the Company’s business relationships with
suppliers, customers and others;
d) the impact of the Company’s operations on the community
and the environment;
e) the desirability of the Company maintaining a reputation for
high standards of business conduct; and
f) the need to act fairly between members of the Company.
Long-term success
We, as a Board, clearly understand our responsibility
to deliver long-term sustainable success and returns
for our shareholders, underpinned by the highest
standard of corporate governance, conduct and
integrity. We collectively review, discuss and annually
agree the Group’s strategy which covers a period of
five years and is then linked to the viability
statement as outlined on pages 43 and 44.
Intertek has been delivering pioneering safety
solutions to companies for over 130 years and in
that time has had to navigate multiple challenges on
a local and global basis. Based on our Science-based
Customer Excellence approach, we have learned
much during the Covid-19 pandemic. By acting
with speed, flexibility and innovation to support our
clients, we have lived up to our philosophy of being
a force for good and will continue to do so as the
demand for Quality Assurance solutions increases
post Covid-19.
Our business can only grow and prosper over the
long term if we understand and respect the views
and needs of our customers, our people and the
communities in which we operate, as well as our
suppliers and the shareholders to whom we are
accountable.
(A) The likely consequences of any decision
in the long term
The importance of having due regard to stakeholders
in the context of decision-making is brought to the
Board’s attention regularly.
Strategic planning discussions are supported by our
Purpose to bring quality, safety and sustainability to
life, and to make the world a better, safer and more
sustainable place whilst looking at the long-term
structural drivers and the emerging trends shaping
the future of the world, to ensure that the business
continues to evolve to meet the changing needs of
all stakeholders.
Examples of some of the principal decisions taken
by the Board during the year, an explanation of the
outcome of the decisions and the matters which
the Directors had regard to when reaching such
decisions, are set out on the next page.
For more information about:
• the Intertek Science-based Customer Excellence
Advantage and the attractive nature of our
industry, Intertek’s effective Purpose-led
long-term 5x5 strategy for growth, see pages 1
to 22 in our Strategic Report;
• the exciting structural growth drivers in the global
Quality Assurance market post Covid-19 and the
focus on climate change, see pages 8 to 9 in our
Strategic Report;
• what we are doing to address our impact on
climate change and the environment, and why
sustainability is central to everything we do, see
pages 49 to 57 of the TCFD statement and pages
24 to 29 in Book two; and
• how we consider Intertek to be viable and a going
concern, see pages 43 and 44 of the Strategic
Report and page 72 of the Audit Committee report
in Book two.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 59
Section 172 statement Continued
Principal decisions
We define principal decisions taken by the Board as those decisions that are of a strategic nature and that are significant to any of our key stakeholder groups. As outlined in the FRC's Guidance on the Strategic Report,
we include decisions related to capital allocation and dividend policy.
For Board
consideration
Stakeholders affected
How stakeholders affected were considered
The principal decision and outcome(s)
Whether the 2022
final and interim
dividend should be
paid in line with our
dividend policy.
• Communities
• Employees
• Governments
• Investors
The Board carefully reviewed the performance of the Group in Q1 and then at the half-year, together with the 2022 outlook
for the profit and loss account and the balance sheet.
They also considered the impact of this decision on our shareholders, many of whom are pension funds which then has
a bearing on individuals in the wider community together with the tax paid on such dividends. Many of our employees are
themselves also shareholders and these payments reflected Intertek's ability to deliver sustainable growth and value for
all of our stakeholders.
Acquisition of Clean
Energy Associates,
LLC (‘CEA’).
• Communities
• Customers
• Employees
• Investors
The Board undertook an extensive review of the business, the market, strategic rationale, management team, culture and
the business plan, as well as many other important factors.
The Board, having consideration to CEA being a market-leading independent provider of quality assurance, supply chain
traceability and technical services to the fast-growing solar energy and energy storage sectors, considered the acquisition
to be a compelling opportunity for Intertek to expand its sustainability service in the fast-growing quality assurance market
for solar energy and energy storage.
Due to CEA’s position as a trusted partner to some of the world’s leading solar project developers, owners and financiers
across the value chain, the Board deemed the acquisition to be a good fit with Intertek’s existing solar energy service
offerings in product testing and certification and in-field inspections, providing an end-to-end service offering to support
customers on their decarbonisation and energy sustainability journeys. The Board also saw the opportunity for CEA to
benefit from Intertek’s global network and customer base, facilitating expansion opportunities into new geographies.
The Board recommended a full-year dividend of 105.8p per share, in
line with the previous year, with payment of a final dividend of 71.6p to
shareholders in June 2022 and an interim dividend of 34.2p in October 2022.
This recommendation reflected the Group’s strong progress in 2021
in revenue, margin, earnings and cash together with a robust financial
performance in the first half of 2022 and the Board’s confidence in the
strengths of our high-quality growth business model.
The Board concluded that it was in the long-term interest of the Company
to proceed with the payment of the dividends.
Following the Board’s extensive and careful consideration, it resolved to
approve the acquisition of CEA after reviewing and agreeing that CEA would
form part of the future long-term success of Intertek and was in the best
interests of all of its stakeholders. The acquisition of CEA was announced
in July 2022.
Continued the
review of the global
Covid-19 Health
and Safety (‘HSE’)
Policy.
• Communities
• Customers
• Employees
• Environment
• Government and
Regulators
Our main priority is always to ensure the health and safety of our employees. By implementing a policy which applies
Group-wide, we ensured that our employees continue to exercise safe practices throughout the ever-changing landscape
of the pandemic.
In May 2022, an updated Covid-19 HSE Policy was issued to reflect
important developments following the approval of multiple vaccines
and the rollout of vaccination programmes.
The Board regularly reviewed the Policy to ensure that changes were implemented to reflect evolving developments in
local practices, globally, and as the understanding of the virus evolves.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Section 172 statement Continued
Board engagement with stakeholders
(matters B, C, D & F)
In the table on the next page we have set out our
key stakeholder groups, how they are linked to our
strategy and risks, their material issues and concerns,
why and how the Board engages with them, and the
outcome of the engagement. We understand the
need to tailor our approach to engagement with each
stakeholder group to maintain positive and beneficial
relationships and to understand their needs and
interests. In this way, we can take account of these
interests in our boardroom discussions and
understand the impact of our decision-making on
each stakeholder group, which in turn ensures we
can continue to provide services that our clients
need, collaborate effectively with our colleagues,
make a positive impact to local communities and
deliver robust returns and long-term sustainable
value for our investors.
60
Strategic priorities
Our strategic enablers
Principal risks
Differentiated brand proposition
Living our customer-centric culture
Superior customer service
Disciplined performance management
Effective sales strategy
Superior technology
Growth and margin-accretive portfolio
Energising our people
01 Reputation
02 Customer service
03 People retention
04 Macroeconomic
05 Health, safety and wellbeing
06 Industry and competitive landscape
07 IT systems and data security
08 Covid-19
09 Contracting
10 Regulatory and political landscape
11 Business ethics
12 Financial risk
More on page 43
Operational excellence
Delivering sustainable results
More on page 10
More on page 10
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Section 172 statement Continued
Customers
Link to strategy and risk
Principal risks
01
02
03
04
05
06
07
08
09
10
11
12
More in Book two, pages 17 to 23
People
Link to strategy and risk
Principal risks
61
Their material
issues/priorities
• Science-based Customer
Excellence approach
• Global supply chain disruption.
• Consistent high quality work.
• Speed of service delivery.
• Safety in workplaces.
Why and how the Board engages
• Customer engagement is important for customer growth as it develops and
strengthens our customer relationships enabling Intertek to understand the
services they need and what they expect from us.
• To ensure that we continue to innovate and anticipate the growing needs of
our customers, constantly evolving and improving our customer proposition
to meet their changing needs and the changing world around us.
• By offering our customers the Intertek Science-based Total Quality Assurance
advantage to strengthen their businesses and supporting them to thrive in an
increasingly complex world.
• Regular reports to the Board with detailed deep dives on major customers
during 2022.
• Data Intelligence Benchmarking by site, service, and customer.
• Net Promoter Score listening to c.5,400 customers per month.
• By visiting two customers in India in October 2022.
Outcome of engagement
• It was clear from engagement that products launched during the pandemic,
namely Protek, had been vital in ensuring the safety of customers’ employees
returning to the workplace.
• Sustainability is one of the priorities for customers as this becomes an area
of increasing focus to make the world a better place.
• Recent examples of innovation by engaging with our customers are Intertek
EcoCheck, Intertek TOXCLEAR and the development of enhanced features to
our market-leading supply chain compliance solution, Inlight 2.0 (see more
information in the CEO report on page 11).
Further examples are below:
• In July, Intertek Hong Kong celebrated the opening of its Pet Product Testing
Centre offering innovative pet product testing solutions to the market.
• In September, Intertek launched a new certification for vegan foods. Intertek’s
Vegan Certification Programme has several facets to determine the suitability
of food products for vegan consumers.
• In December, Intertek Assuris launched Green R&D, an integrated solution
that ensures the sustainability, quality and safety attributes of a product
are optimised from its conception all the way through its life cycle.
Their material
issues/priorities
• Safe laboratory and office working
environments.
• Employee engagement, wellbeing
and mental health support.
• Job security.
• Ethical practices.
• Training and Recognition.
• Information on the business.
• Community involvement.
Why and how the Board engages
• Our core strength is, and always will be, our people. They are key to bringing
quality, safety and sustainability to life for an ever better world.
• We recognise our employees’ contribution to the success of our customers’
products, services and operations. They drive our growth; delivering global
solutions locally to build strong local relationships and fuelled by their deep
understanding of local culture and customer priorities. We have an experienced,
entrepreneurial, diverse workforce with outstanding talent for innovation.
• Regular updates to the Board on the Covid-19 pandemic across the Group to
closely monitor our people’s health and wellbeing using a ‘5-category’ system.
• Updates on our people at every Board meeting and extensive discussions on
people, talent planning and culture throughout the year.
• Understanding the continuing uncertainty in the world and supporting our
01
02
03
05
07
08
11
people and the wider community.
More in Book two, pages 10 to 16
Outcome of engagement
• In 2021, Intertek Check Safety First ('CFS') worked closely with SPS Training
and the Stevenage Job Centre to offer young people an opportunity to join
Intertek under the Government’s Kickstart Scheme. At the end of a six-month
placement, Intertek gained three high performing full-time permanent
employees. This was the result of the overall commitment demonstrated
by CSF UK team to create the inclusive working conditions and a very
welcoming environment for young professionals. Presenting the award in
September 2022, Mehul Shah, CEO of SPS said: “Intertek are very worthy
winners of our Employer of the Year award after the committed and dedicated
work they have done over the past few years in providing opportunities for
young people to establish a career. They have had incredible success with the
young people placed with them and are worthy winners of this award”.
• In July 2022, the Social Innovation Foundation of Thailand presented Intertek
Thailand with a certificate to recognise Intertek’s support to the Government-
sponsored Foundation by providing employment to people with disabilities. We
believe that people with disabilities should have equal opportunity to work and
be able to access all economic and social opportunities without discrimination.
• Diversity is part of Intertek's core values. There is a diverse workforce of 44
nationalities in MENAP and we take pride in creating an environment to
recognise and celebrate unique cultures. In October, Intertek MENAP offices
celebrated Diwali, Indian Festival of Lights, with employees from different
offices and nationalities coming together to celebrate the festive occasion,
fostering the spirit of teamwork and openness in embracing different cultures.
The opportunity was also taken to recognise colleagues’ long service.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
62
Section 172 statement Continued
Investors
Link to strategy and risk
Principal risks
01
02
03
04
05
06
07
08
09
10
11
12
More in Book two, page 62
Communities
Link to strategy and risk
Principal risks
01
02
03
05
06
08
10
11
More in Book two, pages 30 to 35
Their material
issues/priorities
• Long-term strategy and business
model.
• Financial performance.
• Governance.
• Sustainability.
• Risk management.
Why and how the Board engages
• We are responsible to the Company’s shareholders for the proper conduct
and success of the business and our shareholders play an important role in
monitoring and safeguarding the governance of the Group. We do everything
for the benefit of our shareholders, whether they are large institutions or
private shareholders, financially through the returns we generate for them
and reputationally through the way we operate.
• The Chairman holds meetings with shareholders to discuss Corporate
Governance annually.
• One shareholder consultation was undertaken during the year prior to the
Directors' Remuneration report vote at the Annual General Meeting ('AGM').
• Feedback from all such meetings with shareholders is given to the Board.
• Regular investor relations updates to the Board.
• The 2022 AGM facilitated the participation of shareholders virtually via
Microsoft Teams enabling them to ask questions and ensuring their wellbeing,
safety and inclusivity.
Outcome of engagement
• The feedback from the meetings the Chairman had with shareholders was
positive and the shareholders continue to be supportive of Intertek’s strategy,
the management and the Board. The shareholders raised queries on the
business post the pandemic and the opportunities for growth in sustainability.
• Following feedback from investors and other stakeholders, and in line with the
Group’s wider Purpose of bringing quality, safety and sustainability to life,
we introduced an ESG element into the annual incentive framework. More
information is outlined in the Remuneration Committee report in Book two,
pages 78 to 94.
• Decision to pay the full-year and interim dividends.
• Focus on carbon emission reduction plans.
Their material
issues/priorities
• Local employment.
• The environment and our impact.
• Supporting local communities.
• Safety in the workplace, in public
places, on public transport and at
home.
Why and how the Board engages
• We are Purpose-led and passionate about making the world a better place;
bringing quality, safety and sustainability to life.
• We are committed to supporting the communities in which we operate, and
wider society as a whole, as a force for good.
• Our sustainability, growth and innovations, as well as the services we provide
to our customers, also generate direct and indirect benefits for communities
in which we operate.
Outcome of engagement
• In August 2022, a group of 20+ students from the Hong Kong Academy for
Gifted Education attended a taster course by Intertek Hong Kong, allowing
them to get a taster of what to expect from the pharmaceutical product
testing field.
• In November 2022, Intertek Thailand initiated an employee volunteering
programme to help the Baan-Kor-Wang School and for colleagues to give
back to their communities. The project received overwhelming positive
feedback and support from employees across all business lines, through
personal donations and volunteering efforts. Nearly 200kgs of rice, dozens
of seasonings, children’s face masks and stationery were donated, and about
30 volunteers participated on-site, painting the school’s walls and discarding
the old and unused mushroom farming hut. The kindness and compassion
shown by our colleagues not only brightened the day for the students but it
also energised our people by doing the right thing for society.
• In India, the Textile Technology Training Centre’s skill development initiative
aims to provide vocational training, technical knowledge sharing and learning
by working in a Softlines laboratory. In December 2022, after a three-month
intensive course, the first batch of 45 trainees graduated. A small graduation
ceremony was held for the 45 interns in Tirupur. The excitement amongst
the students was palpable. In post-ceremony interactions, students shared
their stories and learnings in the three-month period. Many described their
experience as “a golden opportunity” and “a turning point in their lives”.
Armed now with skill sets making them ready to be employed, the children
of farmers and daily wage earners now have a chance at a brighter future.
• In December 2022, Intertek Assuris in Mississauga hosted a holiday
get-together and fundraiser in support of the Canadian Mental Health
Association ('CMHA'). The results for this day’s activities were overwhelming,
raising $1,000 CAD for the day alone. With these proceeds, combined with
an additional $600 CAD raised throughout the year, the social committee of
Assuris will be making a total donation of $1,600 CAD to CMHA.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
63
Section 172 statement Continued
Government and Regulators
Link to strategy and risk
Principal risks
01
03
04
05
06
07
08
09
10
11
More in Book two, page 22
Their material
issues/priorities
• Compliance with local laws
and regulations.
• Impact on wider society and
on the environment.
• Safety in the workplace,
in public places, on public
transport throughout and
post the pandemic.
• Quality of products.
Why and how the Board engages
• ‘Doing Business the Right Way’ is part of who we are and, as a responsible
business, we are dedicated to engaging positively with governments and
regulators to ensure we are supporting the wider community and complying
with global, regional and local regulations.
• Regular reports to the Board on Risk, Control, Compliance, Quality and
Corporate Governance.
• The regular review of the viability of the business, the risks it faces and
mitigation action plans.
• ‘Doing Business the Right Way’.
• Annual review of Modern Slavery and publication of our statement.
I am excited for our LATAM colleagues to participate in the very
first Compliance Week. It's important to reinforce best practices
when it comes to compliance; focusing on compliance-related topics
throughout the week provides the perfect opportunity to do so.”
Carlos Velasco,
President Latin America and Caleb Brett, Agri, Minerals – Americas.
Outcome of engagement
• The annual revision and update to the Core Mandatory Controls to ensure that
the business operates under essential controls in line with local requirements
and the expectations of doing business.
• The annual Code of Ethics training which is updated each year.
• The first-ever Intertek Compliance Week took place in December 2022 across
our LATAM offices and labs, where our colleagues celebrated 'Doing Business
the Right Way'. Events planned throughout the week included daily
Compliance Talk podcast episodes, training, and quizzes created by our
Americas Compliance Team, all provided in English, Portuguese, and Spanish.
Compliance Week was developed by our Compliance team to recognise the
high level of integrity underpinning the way we work, guiding our decision-
making, and connecting our colleagues across the world. This programme will
be rolled out in other locations in 2023.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
Section 172 statement Continued
Group non-financial information statement
64
(E) The desirability of the Company
maintaining a reputation for high
standards of business conduct
The accuracy and validity of reports and
certificates that we provide, maintaining the
trust and confidence of our customers, their
customers and others impacted by our work,
are important factors which contribute to our
success. Integral to this is ‘Doing Business the
Right Way’ and our internal risk, control, compliance
and quality programme. This means living our
Values, having the highest standards of ethics
and integrity in how we conduct ourselves
every day, everywhere and in every situation.
The programme includes:
• processes, tools and training to ensure that our
people work in a safe and inclusive environment;
• the services we provide and the contracts we
enter into are delivered with integrity and in
line with our commitment to Total Quality;
• a commitment from every colleague to the
highest standards of professional conduct; and
• information about managing our risks and doing
the right thing for the longer term to deliver our
sustainable growth.
For more information about:
• how we carry on business responsibly, see
Book two, pages 32 to 35;
The table below is intended to help our stakeholders understand our position on key non-financial matters in line with the
reporting requirements contained in sections 414CA and 414CB of the Companies Act 2006. Our reporting on these topics
and key performance indicators is contained within this Strategic Report and also in the Sustainability Report, Book two.
Reporting requirement
Description, implementation, due diligence, outcomes and additional information
Environment
Employees
Social matters
Human rights
Environment
Nomination Committee report
Risk management
People and Culture
Communities
Responsible Business Practices
Anti-corruption and anti-bribery
Principal risks and uncertainties
Description of principal risks and impact of
business activity
Description of the business model and the
Science-based Customer Excellence Advantage
Key performance indicators
Doing Business the Right Way
Compliance, whistleblowing and fraud
Principal risks and uncertainties
TCFD statement
Section 172 statement
Our business model
Financial KPIs
Non-financial KPIs
More in Book two, pages 24 to 29.
More in Book two, pages 67 to 70.
More in Book two, pages 50 and 76.
More in Book two, pages 10 to 16.
More in Book two, pages 30 to 32.
More in Book two, pages 33 to 35.
More on pages 43 to 48.
More in Book two, page 34.
More in Book two, page 50.
More on pages 43 to 48.
More on pages 49 to 57.
More on pages 58 to 64.
More on pages 14 to 23.
More on pages 24 and 25.
More on pages 26 and 27.
• our safety priorities, policies and performance,
The Strategic Report was approved by the Board on 27 February 2023.
see Book two, page 10; and
• our system of internal control including our
management of risk, see Book two, pages
50 and 76.
On behalf of the Board
André Lacroix
Chief Executive Officer
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents This report has been printed on material which is
certified by the Forest Stewardship Council®. The
paper is made at a mill with ISO 14001 Environmental
Management System accreditation. Printed using
vegetable oil based inks, the printer is also certified
to ISO 14001 Environmental management system
and FSC® certified.
Intertek Group plc
33 Cavendish Square,
London, W1G 0PS
United Kingdom
Tel +44 20 7396 3400
info@intertek.com
intertek.com
B
o
o
k
t
w
o
sustainability
report
Sustainability is central to everything we
do and we demonstrate our commitments
and passion to help our clients make a
difference as well as bettering ourselves
every day.
We are pleased to share with
you our Annual Report & Accounts
in a unique, three-book format:
Book one – Strategic Report
Book two – Sustainability Report
Book three – Financial Report
These separate, but connected books,
with their interconnected themes and
narratives, allow us to present what
we achieved in 2022 in a systemic,
end-to-end architecture.
They have been designed to make it easier
for our stakeholders to fully understand our
business, how we bring quality and safety
to life, what we offer our clients and society,
and the opportunities we have ahead of us.
The three books, which allow us to
present our work in 2022 to you through
the three important lenses of growth
opportunities, sustainability goals and
financial performance, should be read
together to form our Annual Report &
Accounts 2022.
Look out for these throughout the report:
Reference to another page in the
report or to an external web page
Intertek Sustainability Disclosure Index
Online Review 2022
Strategic Report
Sustainability Report
Financial Report
this report
Where we discuss our growth
opportunities and strategic
performance.
Where we discuss our
environmental, social and
governance progress.
Where we record our
financial activities,
performance and position.
5 Chief Executive Officer's letter
1
Chief Executive Officer's
1 Consolidated income statement
10 Our 5x5 strategy
14 Our business model
15 Who we are
16 What we do
18 Our sectors
19 How we do it
21 The value we create
24 Key performance indicators
28 Financial review
34 Operating review
34 Products
38 Trade
40 Resources
Sustainability letter
5
Our Sustainability Approach
10 Sustainability performance
2
Consolidated statement
of comprehensive income
3
Consolidated statement
33 Responsible Business Practices
of financial position
36 Directors' Report
38 Chairman's introduction
40 Board of Directors
43 Direct reports to the CEO
44 Board Leadership and
Company Purpose
63 Division of Responsibilities
65 Composition, Succession
and Evaluation
4
Consolidated statement
of changes in equity
6 Consolidated statement of cash flows
7 Notes to the financial statements
49 Intertek Group plc –
Company balance sheet
50 Intertek Group plc –
Company statement of changes in equity
51 Notes to the Company
financial statements
43 Principal risks and uncertainties
67 Nomination Committee report
49 TCFD statement
58 Section 172 statement
71 Audit Committee report
54 Independent Auditors’ Report
78 Remuneration Committee report
61 Glossary –
64 Group non-financial information
104 Other statutory information
Alternative performance measures
statement
108 Statement of Directors’
64 Shareholders and corporate information
responsibilities
Visit our website for more information
intertek.com
Book one
Book two
Book three
1
Chief Executive Officer's sustainability letter
Achieving sustainability
excellence in 2022
I would like to thank all our amazing Intertek people
for the incredible contribution they once again made
during 2022, leading by example in every operation.”
André Lacroix
Chief Executive Officer
At Intertek, we have long recognised
that sustainability is the movement of
our time. This is what drives our people
and organisation to ensure we always
place sustainability at the heart of
everything we do, and we can proudly
say we are a force for good in the world.
We are deeply committed to the Intertek
sustainability agenda, which enables us to deliver
sustainable value for all our stakeholders, from
customers and employees to shareholders, suppliers,
regulators and the communities in which we operate.
At its core, Intertek is a network of individuals with
exceptional technical skills and expertise, guided by
science and delivering an unwavering commitment to
our customers. As I reflect on the last year, I’m proud
of our performance, which saw us consistently apply
our Science-based Customer Excellence ('SBCE')
approach to making a positive difference in the world
through the services we provide to our customers
and our own sustainability agenda.
Read more about SBCE in Book one, page 6
Delivering our science-based approach to more
than 400,000 companies around the world makes
us mission-critical to the future of the planet.
Internally, being truly sustainable means much more
than achieving net zero and is about demonstrating
sustainability excellence – end-to-end – in each of our
operations. Our SBCE-focus gives us the structure
and discipline we need to help us deliver against our
own performance targets.
People driving a systemic approach across all
operations creating sustainable value for all
I would like to thank all our amazing Intertek people
for the incredible contribution they once again made
during 2022, leading by example in every operation.
Achieving ever better performance and being a force
for good depends on having a truly diverse, inclusive
and empowering culture that helps our people grow,
develop and innovate. But our people are not just
the beneficiaries of this culture. They are also its
creators and guardians. They have therefore yet
again proved themselves to be the force that’s
accelerating Intertek.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Chief Executive Officer's Sustainability letter Continued
Our Sustainability Excellence Framework
2
I firmly believe that to be a
leader in sustainability, we must
live by and live up to the same
standards our services enable
our customers to embrace.
That is why we developed our
unique Sustainability Excellence
Framework, implemented in
every operation, to deliver
against our Values.
The Framework is solidly underpinned by our
commitment to the highest standards of corporate
governance, our systemic risk management practices,
the Total Sustainability Assurance ('TSA') standards
and our commitment to provide total transparency
across our actions to demonstrate accountability to
our stakeholders.
We have built the Framework itself around five
essential elements that continuously encourage,
enable and empower all our people to achieve
sustainability excellence.
1. Who we are
We are led by our Purpose of bringing quality, safety and
sustainability to life. To do so, we live by our strong Values
every day, which in turn empowers us to aspire to our Vision of
being the world’s most trusted partner for Quality Assurance.
2. What we do
We continuously bring our customers ever better, industry-
leading ATIC solutions that help them create a more resilient
and sustainable world. An essential element of our offering is
the holistic, end-to-end Intertek TSA programme, which
empowers our customers to achieve, deliver and communicate
their sustainability excellence across all parts of their business.
3. How we do it
We focus on achieving sustainability excellence in all our
operations, always holding ourselves to the same TSA
Corporate Sustainability Certification standards against
which we certify our customers (see page 5). We recognise the
importance of determining and prioritising the key sustainability
topics relevant to the business and our stakeholders and develop
our focus areas through ongoing engagement. Our core focus
areas include – People and Culture, working with our Customers,
protecting the Environment and supporting the Communities in
which we operate. All whilst applying responsible business
practices and ‘Doing Business the Right Way’.
4. Why we do it
Quite simply, we are passionate about creating an ever better
world for future generations. Together, these four elements
collectively enable us to deliver against the fifth:
5. Sustainable Value Creation
This is what gives us the right to call ourselves ‘an amazing
force for good in the world’, delivering sustainable growth for
all stakeholders. It’s squarely based on the Intertek USP that
provides the theme to this year’s report: the Science-based
Customer Excellence that enables us and our customers to
lead in quality, safety and sustainability.
Read about our High-Quality Earnings Model in Book one, page 13
1
Who we are
>
>
5
Sustainable
Value Creation
>
Intertek
Sustainability
Excellence
Framework
2
What we do
>
4
Why we do it
>
3
How we do it
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Chief Executive Officer's Sustainability letter Continued
3
Sustainability is central to Intertek
As a purpose-led company, we have embedded
sustainability deeply in:
Our Purpose:
To bring quality, safety and sustainability to life.
Our Vision:
To be the world’s most trusted partner for
Quality Assurance.
Our Values
• We are a global family that
values diversity.
• We always do the right thing,
with precision, pace and passion.
• We trust each other and have
fun winning together.
• We own and shape our future.
• We create sustainable growth. For all.
Making a difference in a challenging year
The last year presented many exceptional challenges,
arising from the continued impact of the Covid-19
pandemic, the war in Ukraine, economic issues and
other crises unfolding in countries and regions across
the world. For this reason, we have had to concentrate
our efforts more closely than ever before on creating
an ever better world for future generations.
In this report, you can read about the thinking,
the actions and the innovations we delivered
and enabled for our customers during 2022
that together reflect the mission-critical role
of sustainability at Intertek.
Read more about how we work with
our Customers on pages 17 to 23
These extend beyond our own sustainability results
to also embrace the many ways in which our services
are helping our clients operate more safely and more
sustainably. This in turn is helping to create happier
and healthier lives for many millions of their
customers across the world.
I’m pleased to say that our sharpened focus on our
net zero action plans as well as our Beyond Net Zero
goals has been well received across our stakeholder
groups. These commitments have provided a clear
roadmap with defined actions our businesses will
take to drive positive impacts.
2022 highlights from our internal
sustainability programme include:
• Continuous progress on Health and Safety
engagement against our Intertek ATIC
Engagement Index. Our 2022 score was 80.
• Our voluntary permanent employee turnover
with a reduction of 7bps in our Total Recordable
Incident Rate vs 2021.
rate returned to the same level as seen prior to
Covid-19 with a rate of 14%.
• Since 2015, we have used the Net Promoter
Score (‘NPS’) process to listen to our customers.
We continue to conduct on average 5,400
interviews each month.
• We are driving environmental performance
across our operations through new science-
based reduction targets to 2030 and site-by-
site action plans. Our rigorous monthly
performance management of our net zero
plans against emission reduction targets has
delivered total CO2e emissions (market-based)
reductions of 7.8% vs 2021. Increasing our use
of renewable energy is a priority as we continue
to invest in new sources of clean energy.
• We recognise the importance of employee
engagement in driving sustainable performance
for all stakeholders, and we measure employee
• Achieving ever better performance depends on
being constantly open to pioneering new ideas
that enable us to improve what we do and how
we do it. This means having an organisation
that is truly diverse. We recognise the value
that individuals of different backgrounds and
capabilities bring to the business and are
determined to increase the number of women
in senior leadership roles and pursue our goal
of having at least 30% by 2025.
Read more about our sustainability
performance on pages 10 to 35.
We never stand still as a business. While we
are proud of these achievements, they have set
the standards that we are determined to exceed
in future.
Building Back Ever Better in our communities
As a business we contribute to our communities in
many ways and each of our operations is part of a
unique local ecosystem. In 2021 we launched the
#BBEB platform, bbeb.com, with the intention of
creating “a truly Glo-cal community-based movement
to help people in their local community space to
inspire friends, family and public institutions to
Build Back an Ever Better world”.
Two years on, our multilingual site carries thousands
of powerful stories posted by individuals across the
world, highlighting inspirational initiatives from
individuals, groups, communities, organisations and
companies, all with the ambition of creating positive
change by demonstrating what can be achieved with
the right determination, focus and energy.
Join bbeb.com today and help build an Ever Better world
Our TSA solutions
Offering innovative sustainability services to our
clients is core to our value proposition and we are
committed to pioneering new solutions that will
help our clients.
What our clients are looking for today is systemic,
independent end-to-end assurance on all aspects of
their sustainability journey. Intertek TSA is a holistic
programme empowering our customers to achieve
sustainability excellence across all aspects of their
business and communicate results with confidence.
TSA is a global programme that leverages our
footprint in over 100 countries and covers all
industries. We have built a team of sustainability
experts in every major region, who can help with
both a global and local perspective.
Intertek TSA is comprised of three parts:
• Intertek Operational Sustainability Solutions;
• Intertek ESG Assurance; and
• Intertek Corporate Sustainability Certification.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
4
Chief Executive Officer's Sustainability letter Continued
Investing for sustainable growth
During the year, as well as growing our organisation
organically through increased demand for our
services, we also made significant investments in
key areas of our business where we believe demand
is set to grow. One of these is the World of Energy,
and we have strengthened our ability to support
leading energy companies in managing the transition
to a more sustainable future.
As well as investing in existing resources, we
made acquisitions including that of Clean Energy
Associates LLC ('CEA'), a market-leading quality-
assurance provider to the fast-growing solar-energy
and energy-storage sectors.
Read more about CEA in Book one, page 12
We also launched several new sustainability-linked
innovations. These include ToxClear, supporting the
development of more sustainable supply chains in
the fashion industry by enabling brands and suppliers
to achieve transparency and traceability on the
chemicals used in manufacturing. Intertek EcoCheck,
a tourism solution that audits management systems
and provides a carbon footprint calculation, enables
our clients to demonstrate tangible action to reach
their carbon targets. On another front, we launched
a new Vegan Food certification mark that gives
consumers transparency about claims made for
vegan foods.
Among many other initiatives and highlights, we also
celebrated the first anniversary of our innovative
Minerals Global Centre of Excellence in Perth, Western
Australia. This pioneering facility aims to help mining
and exploration companies produce the future-
focused commodities that are becoming increasingly
essential in enabling a more sustainable world.
Read more about innovative sustainability services
we provide to our customers on page 17
2023 and beyond
Looking ahead, we are ideally placed to benefit
from a forthcoming step change in sustainability
management, based on heightened expectations
from customers, regulators and other stakeholders.
Corporations are therefore increasingly focused on
safety, quality and sustainability. Most important,
they will be required to place more emphasis than
ever on independently verified ESG disclosures to
meet growing demand for progress and transparency.
Growth opportunities in the World of Energy
are particularly exciting. This is especially true
considering growing recognition that net zero
targets will be unachievable without a major
acceleration in technology and investment to
increase the use of renewables and carbon capture.
Intertek, with our global operations, SBCE advantage
and amazing people at the forefront of their fields, is
better placed than anyone else to benefit from all
these forces.
Our ATIC solutions are already essential for our
clients to power ahead safely and sustainably, and
we will continue to assure our clients with the peace
of mind that’s brought by the knowledge that they
have the right quality, safety and sustainability
standards in place, 24/7.
This is how, along with our own commitment to
sustainability excellence, we aim to continue making
the world a better, safer and more sustainable place
for everyone.
André Lacroix
Chief Executive Officer
ESG Credentials
We actively participate in a range of global ESG ratings, indices and
frameworks to benchmark our approach against best practice
and emerging sustainability challenges.
Intertek received a rating of ‘AAA’
in the MSCI ESG Ratings assessment.1
We were included in the FTSE4Good Index
for the sixth year running.
Intertek are rated "Prime", fulfilling ISS ESG's
demanding requirements regarding sustainability
performance in our sector.2
In July 2022, Intertek received an ESG rating of
19.8 and was assessed by Sustainalytics to be at
low risk of experiencing material financial impacts
from ESG factors.3
1. msci.com/notice-and-disclaimer
issgovernance.com/esg/ratings
2.
sustainalytics.com/legal-disclaimers
3.
Intertek participates annually in CDP’s
Climate Change Programme. In 2022, CDP
recognised our progress with a 'B' score.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 5
Our Sustainability Approach
Sustainability excellence
in every operation
At Intertek, our goal is to deliver
sustainability excellence across
all operations.
Our Ever Better systemic approach is based both
on the requirements of the Total Sustainability
Assurance ('TSA') Corporate Sustainability
Certification Standards – which provide the
definition of what it means to be a sustainable
company, end-to-end – as well as our assessment
of material topics for our stakeholders.
Building on this, our continued engagement with
stakeholders helped us to identify our focus areas.
Processes and procedures are implemented, and
we report our progress through this report, our
website and through continued engagement with
our stakeholders.
This systemic approach provides valuable insights
which in turn enable us to align our sustainability
initiatives and prioritise our focus areas.
An Ever Better systemic approach
Engagement
3
Implementation
5
1
Total Sustainability
Assurance Standards
2
Materiality
Assessment
Total Sustainability Assurance standards
1
The TSA programme is based on ten corporate
sustainability standards that we believe define
a truly sustainable organisation today. We
believe that these TSA standards are the most
comprehensive sustainability standards currently
available, forming the foundation of our approach,
challenging us to view our processes and
procedures through this end-to-end lens.
Our ten TSA Corporate Sustainability Certification
standards demonstrate actionable, comparable,
consistent and reliable disclosures and provide
assurance beyond ESG disclosures. They recognise
that truly sustainable solutions must address the
important operational aspects of every company,
to cover environment, products, processes,
facilities, assets, systems, corporate policies and
stakeholder engagement.
To embed the requirements of all ten standards
and review our progress, we carried out a
self-assessment for each standard followed by
a gap assessment audit of our corporate head
office and a selection of operational sites that
are representative of the mix of business lines and
activities within our operations.
The audit team comprised subject matter experts
from our Business Assurance business line, who
benchmarked our sustainability programmes
against the requirements of each standard.
Performance is benchmarked against requirements
and based on maturity. On completion of the
benchmarking step the audit team reported their
findings and on the extent to which corporate
sustainability processes are in place, effective and
meeting the intent of the standard.
The outcomes have further fed into our Ever
Better approach and provided valuable insights
which will enable us to align our sustainability
initiatives and priorities further.
Ten TSA Corporate Sustainability Certification standards
Quality
& Safety
People
& Culture
Communities
Governance
Risk
Management
Compliance
Financial
Environment
Enterprise
Security
Communications
& Disclosures
6 Reporting
Focus areas
4
To see more on TSA standards visit intertek.com/sustainability/corporate
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Our Sustainability Approach Continued
6
2 Materiality
3 Engagement
4 Focus areas
We recognise the importance of determining and prioritising
the key sustainability topics relevant to the business and our
stakeholders. We assess material topics using social, environmental
and financial criteria, taking into account the methodologies of
AccountAbility’s AA1000 Principles, the GRI Standards, CDP,
UN SDGs and SASB guidelines.
Intertek supports the development of globally adopted
sustainability disclosure standards and will consider their impact
on our material topics in the future.
Recognising the dynamic nature of materiality, this process is
reviewed at least bi-annually to ensure that views and emerging
trends are being addressed by Intertek.
We have addressed the material topics identified within our
focus areas.
We have always understood our role in society as companies around
the world have depended on us to help ensure the quality, safety
and sustainability of their products, processes and systems.
Engagement with our stakeholders plays a critical role in delivering
long-term success. This dynamic process provides valuable insights
which in turn enable us to align our sustainability initiatives, drive
progress against our Beyond Net Zero goals and prioritise our
focus areas.
Evaluating both the requirements of the TSA standards and our
material topics has helped to shape our sustainability strategy.
Our core focus areas include: People and Culture; working with
our Customers; protecting the Environment; and supporting the
Communities in which we operate.
All whilst applying responsible business practices and ‘Doing
Business the Right Way’.
Read more about our engagement with key stakeholders
on pages 52 to 62
Although less material, all other topics remain an essential part of
our Ever Better approach and we systematically re-evaluate them
to determine whether they have become more material to the
organisation or our stakeholders.
Read more detail on our focus areas on pages 8 and 9
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
Our Sustainability Approach Continued
7
5 Implementation
6 Reporting
Sustainability is about more than protecting the planet. Taking
a broader view on sustainability, we empower our local teams to
address solutions within their communities and create opportunities
to support a promising future for the next generation.
Reporting on our sustainability performance indicators in a
consistent and accurate manner is essential to deliver transparency.
We recognise that corporate disclosure and transparency are key
catalysts for driving change.
Our Sustainability Excellence Framework is underpinned by the
highest standards of corporate governance, our systemic risk
management processes and our continued evaluation against
the TSA standards.
We are committed to providing stakeholders with accurate and
timely updates on our sustainability activities and performance
and make every effort to produce a report that is balanced and
transparent and meets their needs.
The following pages will demonstrate how we bring quality, safety
and sustainability to life and provide our stakeholders with a
transparent account of the progress we have made on the most
material sustainability issues the Group faced during 2022.
intertek.com/about/our-responsibility/
Intertek Sustainability Disclosure Index
Our Science-based
approach to Sustainability
Excellence is helping us
to make progress and a
positive difference in
the world."
Ida Woodger
Head of Sustainability
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 8
Book one
Book two
Book three
Our Sustainability Approach Continued
Our focus areas
Our Ever Better systemic approach
to Sustainability Excellence identified
four core focus areas:
People and
Culture
Our goal is to
have fully engaged
employees working
in a safe environment
Read more on pages 10 to 16
What we measure:
• Health and Safety incidents
• Employee engagement
• Voluntary permanent employee turnover
• Diversity and inclusion metrics
Why it matters:
Our people bring exceptional technical skills,
expertise and their passion and energy to our
business and in turn we must keep them safe
and engaged and offer them exciting personal
growth opportunities.
Working with
Customers
Ensure our customers
can operate safely
and sustainably in
a complex world
Read more on pages 17 to 23
What we measure:
• Customer satisfaction
• Operational Excellence
Why it matters:
Our science-led services and innovations give
our customers the solutions they need to
overcome their own risk and challenges in
quality, safety and sustainability, enabling
them to power ahead with confidence.
Link to risks: 1
3
5
7
8 11
Link to risks: 1
2
4
6
7
9
10
11
In action
10X Leadership
At Intertek, our leaders strive to be the best
in the industry. We believe in the spirit of
Ever Better and know that the ability our
leaders have to develop and grow employees
in their teams is one of the biggest factors
that will influence the exciting growth
journey we have ahead of us.
Read more about 10X Leadership and our 10X
Coaching Certification Programme on pages 57
and 58.
In action
Innovative sustainability
services
Through our leading-edge innovations and
integrated ATIC solutions, we are uniquely
placed to help our customers understand,
achieve and validate their existing and
emerging sustainability goals.
Intertek Group plc Annual Report & Accounts 2022Sustainability ReportFinancial ReportStrategic ReportContents
Our Sustainability Approach Continued
9
Book one
Book two
Book three
Environment
Decarbonise our
business by 2050
Read more on pages 24 to 29
What we measure:
• Emissions
• Energy
• Waste
Why it matters:
We have a responsibility to minimise negative
environmental impacts from our operations,
in compliance with regulations, and to live up
to the requirements and expectations of our
key stakeholders.
Communities
Create positive
impacts in the
communities where
we operate
Read more on pages 30 to 32
What we measure:
• Community projects
• Environmental projects
• Education projects
Engagement through #BBEB
Why it matters:
Taking active responsibility to support the
communities and environments where we
operate to create sustainable growth for all.
Link to risks: 1
2
6
Link to risks: 1 10 11
In action
Implementing net zero
action plans
Across Intertek we are progressing rapidly on
our net zero journey with our detailed action
plans and new targets in place.
New initiatives, like our solar energy projects
in India and Bangladesh, are contributing to
setting us on our path to meeting our group
targets.
In action
Engaging with communities
around the world
Bringing quality, safety and sustainability
to life by developing open relationships with,
and investing in, the communities in which
we operate builds trust and collaboration.
Our commitment is brought to life through
practical support and assistance where we
believe we can make the greatest difference.
Intertek Group plc Annual Report & Accounts 2022Sustainability ReportFinancial ReportStrategic ReportContents Contents
Sustainability performance
10
People
and Culture
Our goal is to have fully
engaged employees working
in a safe environment.
We truly value our people. We embrace
diversity, inclusion and equality, and our
success is based on a culture of trust
among colleagues globally.
Our people bring exceptional technical skills,
expertise and their passion and energy to our
business and in turn we must keep them safe and
engaged and offer them exciting personal growth
opportunities.
Our People Strategy is all about energising our
colleagues to take our business to new heights.
Employee engagement, human rights and worker
health and wellness are core to the long-term success
of our business. We strive for a sustainable workforce
that is stable, engaged and committed to the
organisation, our goals and objectives. We respect
and protect the rights of our people across operations
and throughout our business relationships.
Ensuring the health, safety and
wellbeing of our employees
Through having fully engaged employees working
in a safe environment will we be able to deliver our
TQA Customer Promise.
Our aim is to encourage a culture of proactive Health
and Safety ('H&S') awareness, industry best practice
and continuous improvement to increase H&S
performance globally. Our Group-wide ‘General Safe
Working Guidelines’ provide the basis for a common
and aligned H&S standard for all Intertek sites.
This includes a dedicated fire warden, first aider
and H&S representative at each location. These
representatives are empowered not only to
investigate incidents and implement preventative
and corrective actions, but also to disseminate
safety information through training and targeting
continuous improvement.
We firmly believe that to drive progress, the
performance indicators we track must focus on
the diligent implementation of robust processes
and actions that lead to building a culture of
proactive H&S awareness.
With dedicated reporting each month for country and
business lines supplemented by inclusion in the 5x5
analysis for every site, our global network of H&S
‘Champions’ supports continuous improvement. By
improving our H&S communication network, we not
only have a known contact person in each country
and location but also a means of channelling and
sharing information and programmes globally.
We continue to build an open and trust-based
environment that reports and learns from safety
risks and incidents. During 2022 we have seen levels
of Hazard Observations and Near Misses increase,
reflecting increased levels of activity across our sites
as well as greater awareness and reporting overall.
Even if accidents or incidents occur, our safety
culture, processes and mitigating actions have the
strength needed to ensure that no significant harm
occurs, which is demonstrated by our progress of
driving the Total Recordable Incident Rate down
7bps on 2021.
The health and safety of our employees and
contractors are the utmost priority at Intertek.
All of our businesses have robust H&S training
programmes during our induction/on-boarding
process, emergency responses procedures,
intervention and reporting of hazard observations,
near misses and safety incidents. We continue to
provide appropriate personal protective equipment
and continually expand on existing programmes
Group1
Hazard Observations
Near Misses
First Aid
Lost Time Incidents
Medical Treatment Incidents
Fatalities
Total Recordable Incident Rate ('TRIR')2
and controls to improve the health, safety and
wellbeing of our colleagues.
We are also committed to the continuous review,
monitoring and improvement of our H&S performance.
Our target remains for our TRIR to equal or be less
than 0.5. This target is part of the next phase of our
H&S cultural journey and supports our continued aim
to achieve zero lost time incidents.
Workplace mental health
At Intertek, we consider the health, safety and
wellbeing including the mental health of our
employees, clients and third parties connected
with our business to be of paramount importance.
During 2022 we have deepened the impact of our
Kindness programme through our workshops which
have now been run across all Intertek regions.
The programme covers six spaces to focus on during
this personal experience that will help each of us to
make sure that we do the simple things that help build
our own personal strength and resilience – to help us
re-energise, boost our wellbeing and unleash our
potential. We see these as the core areas of wellbeing.
0.44
Total Recordable Incident Rate
2022
20,992
3,328
789
93
96
0
0.44
2021
19,172
3,044
1,043
120
101
1
0.51
change
9%
9%
(24%)
(23%)
(5%)
(1)
(7bps)
1. Data captured for the Group consists of individuals engaged through Intertek contracts of employment (full- and part-time and those on
fixed-term contracts of employment).
2. Rate refers to the number of Lost Time Incidents, Medical Treatment Incidents and Fatalities occurring per 200,000 hours worked.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook three 11
Talent management
To seize the exciting growth opportunities arising
from our TQA value proposition, we continually
invest in the growth of our people. We aim to hire,
inspire, engage and retain the best people to power
our 5x5 strategy, providing the skills to grow our
business.
With an ‘ever better’ mindset we encourage our
people to continuously learn new skills that help
advance their careers and deliver our TQA Customer
Promise. Our talent-planning process is critical to
our future success in delivering our strategy and
fostering our Culture and Values throughout Intertek.
The Board as a whole is responsible for ensuring that
appropriate human resources are in place to achieve
our long-term strategy and deliver sustainable
performance. Global talent and succession planning
for the Leadership Team are discussed regularly.
In employment-related decisions, we comply with all
applicable anti-discrimination requirements in the
relevant jurisdictions. We have zero tolerance for
discrimination and harassment.
Sustainability performance Continued
Talent attraction, reward and recognition
We reach out to prospective employees in a
variety of ways, depending on location and role, in
compliance with local regulations for fair recruitment
practices and equal opportunities. We post vacancies
on our website and employ various ways of sourcing
talented people. These include recruitment agencies,
social media, printed advertisements, employee
referrals, professional bodies and associations,
schools, colleges and universities. We are committed
to recruiting talent local to our operations where
possible. To offer career growth and progression
within the Group, we seek wherever possible to
fill vacancies from within the business first.
intertek.com/careers
We fully recognise the importance of employee
engagement in driving sustainable performance
for all stakeholders. In order to measure our
employee engagement, we follow the Intertek
ATIC Engagement Index which is based on the key
drivers of sustainable value creation within our
differentiated ATIC business model, and which
measures engagement on a monthly basis in every
operation with the following metrics: Net Promoter
Score, Customer Retention, Quality, Voluntary
Permanent Employee Turnover and Total Recordable
Incident Rate. For 2022, our ATIC Engagement Index
score remained at the same level as 2021 with a
score of 80. We believe engagement levels across
the Group are high and our target is to achieve an
engagement index score of 90 moving forward.
During the year our Voluntary Permanent Employee
Turnover rate averaged a rate of 14%, returning to
the same level as seen prior to Covid-19. As we
progress our People Strategy we will continue to
aim for a rate below 15%.
In action
Recognition across our regions
Celebrating exceptional performance
from our colleagues and teams across the
Group is an important part of our Culture.
During the year, we have had the chance to
come together in Town Hall meetings, to
honour outstanding individuals who contribute
positively and spread great energy to people all
around us.
These events take place both in person and
virtually, connecting our colleagues across
the world.
Our teams in Vietnam took the opportunity
to celebrate and reflect on outstanding
performance throughout the year. We are very
passionate about developing our people and
we strive to engage and energise all of them
through operational excellence. Offering
opportunities to grow, both personally and
professionally, in a collaborative environment,
through training and recognition.
Reward and recognition
Reward plays a key role in attracting, motivating
and retaining talent. Intertek is compliant with
minimum wage and mandatory social contributions
requirements in all jurisdictions where we operate.
At Intertek, remuneration for all employees follows
the same policy and principles as for the senior
executives. The Remuneration Committee has
oversight of this.
Read more about this on pages 80 to 86
We depend on local management to define and
maintain competitive compensation practices
that appeal to both existing and future talent.
All employees are remunerated in accordance with
local policies and guidelines. The remuneration
comprises elements which are fixed, and in some
cases, variable. The fixed elements are base salary
and benefits including pensions, where applicable.
The variable elements include incentives, both
short- and long-term.
Across the world, employees who are eligible for
a bonus follow the same metrics thus creating
alignment on our strategic goals throughout
the organisation.
Intertek is an accredited
Living Wage Employer
in the UK
Recognition plays an important part at Intertek
and we take every opportunity to recognise
great performance across the business through
our internal channels.
Read more about this on page 58
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 12
The individual learning journey of each employee
is supported with diverse learning opportunities
that are continually refined based on business
need, employee feedback, best practices, trends
and new technologies.
There are many programmes across the
business, providing in-house and external learning
opportunities. We recognise the wide range of
sectors we support require different types of
technical training, education and support.
We offer:
• apprenticeships;
• internship programmes;
• college degrees;
• professional qualifications;
• formal and informal workshops and seminars; and
• coaching.
During 2022, 213 of our leaders took part in our 10X
Leadership programme. Across all other programmes
our employees engaged with and completed over
670,000 hours of training.
Sustainability performance Continued
Skills development
As a provider of quality, safety and sustainability
assurance services, Intertek relies on a skilled
workforce. We are committed to offering attractive
career development opportunities and believe in
personal growth for every employee. We know that
when each of us is growing and developing, we move
faster along our good-to-great journey.
Over the years we have made great progress with
our Leadership Development agenda as well as
enhancing the tools and applications available to
enable people to grow and succeed in their careers.
We ensure that all employees receive adequate
coaching, development and training to be fully
competent to carry out their role. This is supported
by our many Group-wide programmes including
talent planning processes, the 10X Journey that
provides structure for individual growth planning,
our 10X Energies that help define winning
behaviours and ‘10X Way!’ training to help address
key development and training needs.
100%
of our employees are offered,
as a minimum, yearly discussions
on growth and development
In action
Say hello to LUCIE –
a new, improved
learning experience
At Intertek, we seek to improve –
listening and acting on what we hear,
which helps us enhance the tools
and applications available to enable
our people to grow and succeed in
their careers.
Intertek’s bespoke Learning Management
System ('LMS') has evolved. Our previous
system, the '10X Way!', has become 'LUCIE'
('Learning Universe Connecting Intertek
Expertise'). LUCIE is hosted by our very own
award-winning learning platform Wisetail,
bringing its world class expertise to our
people's learning and development journey.
LUCIE offers everything our traditional LMS
provided, and much more. With a fresh new
look, the platform will not only allow us to
remain compliant, but to be more connected
and allow us to share ideas and resources
across business lines globally. As with most
projects of this nature, we transitioned to
LUCIE in phases across the organisation,
starting with the USA and Canada in
February, followed by the rest of the
Americas, EMEA and APAC in April 2022.
Inclusion, diversity and equality
At Intertek, achieving ever better
performance depends on being
constantly open to pioneering new
ideas that enable us to improve what
we do and how we do it. For us, this
means having an organisation that is
truly diverse and inclusive.
Intertek has a history that goes back over 130 years,
evolving from the combined growth of a number
of innovative companies from around the globe.
Diversity has always been at the heart of who we
are and will continue to provide the power behind
our success in the future. With team members from
over 100 countries – all with different backgrounds,
cultures and beliefs – our diverse workforce makes
us the leading company we are today.
To achieve the optimum mix of skills, backgrounds
and experience, workforce diversity needs to go
beyond discussing the percentage of women to also
include other diversity indicators. As a business we
want to ensure that we have the right capabilities
to deliver our strategy. We recognise the value that
individuals of different backgrounds and capabilities
bring to the business.
Our diverse workforce helps us to understand,
communicate and trade with our vast client base
through their understanding of local issues and
cultures. They add value in assuring our services
are tailored to our customer needs, which underpins
sales growth, customer retention and satisfaction.
We demonstrate that we are an inclusive and
diverse global family by applying all employment
policies and practices in a way that is informed, fair
and objective. This covers all policies relating to
recruitment, promotion, reward, working conditions
and performance management. Our Inclusion and
Diversity policy facilitates a culture of inclusiveness
where people are able to perform at their best, where
their views, opinions and talents are respected,
harnessed and not discriminated against.
We are committed to maintaining the highest
standards of fairness, respect and safety.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Sustainability performance Continued
Gender diversity
We are determined to develop and
retain more women in senior roles.
Our goals
Improving gender balance is critical for us.
We continue to focus on gender diversity by
attracting, developing and retaining more
talented women, particularly at senior levels.
We continue to pursue our goal to increase the
number of women in senior management roles
to 30% by 2025.
Metrics and performance
35%
of our global TQA Experts are women.
13
In action
Successful year for North America Women’s Group
Our North America Women’s Group, one of our
Employee Resource Groups, which aims to foster
a diverse, inclusive workplace aligned with our
Values has continued to grow through 2022. What
started as a small gathering on a quarterly basis in
Austin, Texas has grown to over 50 women
meeting once a month (virtually).
The group has held various ELLE! ('Empower Learn
Lead Expand') Talks – featuring women leaders
within the business; invited guest speakers to talk
on specific subjects – including managing personal
finances during the pandemic – and piloted a
successful mentoring programme.
50+
women meeting
once a month
We ensure that men and women are paid equally
for doing equivalent roles and we are committed
to a number of measures to ensure we provide
an energising workplace, free of any gender bias,
where employees can flourish based on their talent
and effort.
To strengthen this, we ensure that our shortlists
of external hire candidates have a balance of
gender diversity.
Board
We remain committed to equality, and provide
flexible working where possible and provide
mentorship to women to address the gap in
gender numbers at senior levels.
Executive Management Team (‘Exec’)2
Direct reports (‘DR’)
Combined: Exec + DR
All Employees
20221
20211
Male
Female
Male
Female
7
19
198
217
4
2
55
57
6
17
207
224
3
2
65
67
28,357
15,240
28,385
15,678
1. Data relating to the Board and all employees is as at 31 December and the Exec and DR as at 31 October of each year.
2. As defined by the FTSE Women Leaders Review. This comprises the CEO and his direct reports (N-1).
In action
Intertek Spain implements
a new equality plan
Our commitment to equality aligns with
the UN’s 2030 Sustainable Development
Goals to 'achieve gender equality and
empower all women and girls' and to
'promote sustained, inclusive and
sustainable growth, full and productive
employment and decent work for all'.
In 2022, Intertek Spain committed to the
implementation and development of policies
that integrate the equal treatment and
opportunities between women and men, as
well as the promotion of measures to achieve
real equality within the organisation. The
main areas of action undertaken address
salary policy, training, employment and work
conditions, occupational health, work-life
balance, the prevention of sexual harassment
by reason of gender, and the non-
discriminatory use of language in all
communications and advertising.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 14
Sustainability performance Continued
In action
Recognising the value that women bring to Intertek globally
Around the world, Intertek colleagues
celebrated International Women’s Day
('IWD') on 8 March, 2022, and explored
ways they could each help to
#breakthebias.
Intertek Lintec’s marine services support the
world's shipping industry – an industry in which
women are traditionally underrepresented. On
International Women’s Day, we wanted to help
#breakthebias by recognising the value that
women bring to the marine community, the
changes that are underway in the industry, and
the fact that many more women now occupy
senior roles, many of them among our own
formidable team of women at Intertek Lintec.
At Intertek Bangladesh, female colleagues
were greeted with flowers at the office
entrances by their male colleagues to mark
International Women’s Day. Special events were
organised at both regional and local offices,
including the launch of a special video featuring
female colleagues sharing their own stories to
highlight this year’s theme of #breakthebias – a
theme that was extended to colleagues across
South Asia in the days and weeks that followed.
In Intertek's Middle East, North Africa and
Pakistan (MENAP) region, women from diverse
backgrounds work across numerous different
departments and functions – in the field, in
laboratories, and in offices. This year we held
IWD events that focused on breaking the bias,
women's rights and the importance of mental
health and self-care. Zeiba Rizvi, Finance
Manager at Intertek Inspec, believes that
International Women's Day is a great
opportunity to get together, share
experiences, and learn from each other: “I'm
proud to be part of a diverse and inclusive
organisation that empowers women and gives
us a chance to grow."
Intertek Cristal is a market leading global
health, safety, quality, and security risk
management business focused on the travel,
tourism, and hospitality sectors. The company
celebrated International Women’s Day with a
range of initiatives aimed at acknowledging
the contribution of women in the industry and
empowering women by highlighting the need
for an inclusive work culture where women's
careers flourish, and their achievements are
celebrated. This included celebrating the
contribution of inspirational women in the
sector of travel, tourism, and hospitality, as
well as the achievements of Cristal’s own
inspirational women leaders.
I'm proud to be part of
a diverse and inclusive
organisation that
empowers women
and gives us a chance
to grow."
Zeiba Rizvi,
Finance Manager
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 15
In action
Reducing the skills gap and building
employability among the young
Intertek India is helping to create a
sustainable workforce of the future
through a skill development initiative
for the country’s underprivileged youth.
With a widening skills gap in the labour force in
India and a youth unemployment rate above 50%,
Intertek India is focusing on community welfare
as part of its wider social responsibility vision to
connect and build back ever better. Programmes
include health and hygiene, poverty alleviation,
and education and skills development. One of our
recent initiatives has been the launch of a skills
development project in Tirupur, Tamil Nadu.
Even though the city is a well-known textile and
garment hub with TIC labs, there is a mismatch
between availability of skilled manpower and
requirements of the industry. To help bridge this
gap, and improve textile testing and quality
assurance, Intertek helped found a Textile
Technology Training ('T3') Centre in Tirupur in
partnership with Reviving Green Revolution Cell,
a Tata Trusts initiative in vocational training.
With Intertek's support, the T3 Centre offers
free training to more than 600 youngsters in
three certified courses for future lab technicians,
chemists, merchandisers, and customer executives.
The three-year project will help socioeconomically
disadvantaged youth – especially, women – secure
better job opportunities and gain professional
empowerment.
Sustainability performance Continued
Talent across all generations
We value all of our colleagues,
regardless of age, and have
practices in place to develop
and retain workers of all ages.
Our goals
We will continue to develop proactive approaches
to recruitment to ensure we have an age-diverse
and balanced employee age profile.
Metrics and performance
60%
of our global TQA Experts
are under the age of 40.
The technical expertise needed in many parts
of our complex business is acquired over several
years. This is reflected in the overall average age
of 39.
We will continue to promote and endorse fair,
consistent and thoughtful working practices
that are in accordance with our Values.
At Intertek, we are proud to be an equal
opportunities employer.
We consider all qualified applicants for employment
regardless of gender, ethnicity, religion, age,
disabilities and other protected characteristics.
In action
Intertek Cristal win
Employer of the Year Award
Intertek Cristal were the worthy winners of
the SPS Stretch Employer of the Year award
after the committed and dedicated work over
the past few years in providing opportunities
for young people to establish a career. They
have had incredible success with the young
people placed with them and are worthy
winners of this award out of over 220
nominations.
In action
Tribute to a remarkable
career at Intertek
Global and local guests celebrated the
achievements and retirement of Christina Law,
President of Global Softlines and Hardlines,
who has served 33 years at Intertek.
Christina is an iconic figure of leadership at
Intertek Hong Kong. Most of her 33 years of
working life has been based out of Hong Kong.
Her 10X Energies and drive have encouraged
many young leaders, who continue to flourish
and grow at Intertek.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 16
In action
Launch of Intertek’s
V500 taskforce
We are proud to be a member of the Valuable 500
community. Participating is a meaningful step in
our continued journey to deliver our Vision of
making the world a better, safer and a more
sustainable place.
Since joining the Valuable 500, we have been
raising awareness of disability inclusion among
colleagues through the training of an internal
taskforce who acts as an Employee Resource
Group. This cross-functional team is made up of
disabled and non-disabled colleagues.
Collectively they are working on greater visibility
of the current state of disability inclusion within
Intertek, identifying training needs and goals.
Sustainability performance Continued
Disability inclusion
Adopting a universal design mindset.
Our goals
To adopt a disability inclusive mindset as well as
deliver on our commitment to the Valuable 500.
This is centred around incorporating disability
inclusion criteria into the full spectrum of
products and services we offer our clients.
Metrics and performance
We believe that in order to create rapid,
system-level change specific to disability
inclusion and equity, we must actively seek
out opportunities to collaborate with other
businesses who hold the same values and are
equally committed to affecting change.
We also recognise the gaps in the global
business community's knowledge of employees
with disabilities and are supportive of the call for
greater visibility of the current state of affairs.
We are looking to broaden the adoption and
disclosure of relevant KPIs that will help to create
a consistent and comparable baseline from which
to measure progress on disability inclusion.
We have taken the first steps to assess the
availability of data internally recognising the
complexities of disability data and will progress
this further in 2023.
In action
Community engagement
through indigenous
awareness
Intertek Australia acknowledges the Traditional
Owners and their continuing connection to land,
sea and community and pays its respects to
Elders, past, present, and emerging. During
NAIDOC 2022, Intertek Australia hosted training,
discussed cultural awareness objectives and
shared stories of positive advancement.
NAIDOC Week celebrates the history, culture,
and achievements of Aboriginal and Torres Strait
Islander peoples. NAIDOC Week is celebrated by
all Australians and is a great opportunity to learn
more about Aboriginal and Torres Strait Islander
communities.
Cultural diversity
(arising from country of origin)
Cultural diversity supports our global
business and is key to our success.
Our goals
We are committed to cultural diversity and
will ensure that Intertek’s colleagues are
representative of the countries where we
do business.
Metrics and performance
46
different nationalities
across our senior leadership
We recognise that comprehensive diversity
monitoring is foundational to our diversity and
inclusion strategy, which lies at the heart of
our culture. We continue to monitor protected
characteristics and to promote further
transparency, particularly at senior level, have
plans to update our diversity monitoring.
In addition to cultural diversity arising from
country of origin, we have plans to enhance
our reporting on ethnicity.
Read more about the diversity of our Board on page 70
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Contents
Sustainability performance Continued
17
Working
with our
Customers
Innovative sustainability
services have been core
to our global business for
more than 100 years.
Channels of
customer interactions
Customer meetings
Emails and phone calls
Web enquiry responses
Workshops and seminars
Social media communications
Through our leading-edge innovations
and integrated ATIC solutions, we are
uniquely placed to help our customers
understand, achieve and validate their
existing and emerging sustainability
goals.
Capturing the right data
to optimise operations
Identifying and managing risks that can impact
our service quality is key to ensuring customer
satisfaction. Our 5x5 metrics tool and processes
enable the collection and review of performance
metrics across the areas of sales, customers,
people, finance and operational excellence that
are fundamental to disciplined performance
management. The 5x5 metrics provide every
Intertek site and team leader with 360º insight into
their business to guide their decision-making and
ultimately lead to superior business performance.
Customer focus
To become the most trusted partner for Quality
Assurance, we have made a promise to our customers:
Intertek TQA expertise, delivered consistently with
precision, pace and passion, enabling our customers
to power ahead safely.
Intertek has a strong focus on customers, at all levels
of the organisation, and our customer relationship
management is integrated into our approach through
a key account management structure and dedicated
sales teams. Our Marketing & Sales Operations team
works closely with business lines and country
leadership to drive continued improvements across
marketing, sales and digital tools to ensure that
every aspect of customer engagement aligns with
our TQA Customer Promise.
Customer Promise
Intertek’s Total Quality Assurance expertise,
delivered consistently with precision, pace
and passion, enabling our customers to power
ahead safely.
Listening to our customers
Since 2015, we have used the Net Promoter Score
(‘NPS’) process to listen to our customers. These
insights give us a deep understanding of what our
customers need and want, fuelling our innovations.
Our customer interviews keep us laser-focused on
delivering an ‘ever better’ service. During 2022,
we conducted an average of 5,400 interviews
each month.
Accelerating positive sustainability impact
We recognise the importance of sharing our own
sustainability journey with our customer, partners
and local communities.
We actively engage with requests to support
individual sustainability and carbon performance
assessments, including EcoVadis and the CDP
Climate Change questionnaire.
This gives us the opportunity not just to meet the
demands of our investors and customers, but also
uncover risks and opportunities and track and
benchmark our progress.
We aim to collaborate as a trusted supply chain partner
to deliver improvements in the areas most material over
the long-term and accelerate sustainability impacts.
We are here to help our stakeholders understand
sustainability, why it matters, and how to effectively
integrate it within business.
Intertek Assuris launched Sustainability
Webinar series with over
6,500
registrants over seven sessions
intertek.com/assuris/
sustainability-matters-webinar-series/
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook three
Sustainability performance Continued
Supporting our customers with
their sustainability agendas
Innovative sustainability services have
been core to our global business for more
than 100 years.
Through our leading-edge innovations and
integrated ATIC solutions, we are uniquely placed to
help our customers understand, achieve and validate
their existing and emerging sustainability goals.
18
In action
Speciality microbes -
a sustainable alternative
to fossil fuels
In action
Intertek joins flexible packaging initiative to
support the circular economy in Europe
Intertek Assuris is playing an important
role in helping to achieve approval for
novel microbes that have been developed
and tweaked to produce biofuels more
efficiently.
As a member of CEFLEX, we are working
with 180 stakeholder organisations to
help build the circular economy for flexible
packaging and promote recycling
technologies in Europe.
Many industries are investing in research and
development for sustainable alternatives in
their supply chain. As a key part of these efforts,
Intertek Assuris is supporting the development
of biofuels by helping to achieve approvals for
speciality microbes that can produce sustainable
alternatives to the historical use of fossil fuels and
offer both environmental and financial benefits.
These same or similar microbes can also be used as
sustainable materials in other areas to produce
biochemicals for, or as live microbial ingredients in,
cosmetics, household cleaning products, food,
polymers, and agricultural products.
CEFLEX is a collaboration of over 180 European
companies, associations, and organisations
bringing together the entire value chain of
flexible packaging to tackle the complex
technical and business barriers to a circular
economy. The consortium’s goals include
establishing guidelines on packaging design,
driving collection and sorting of flexible
packaging materials, and identifying sustainable
end markets for their downstream use.
As a CEFLEX member, Intertek is supporting
the creation of a circular economy for flexible
packaging through its polymer testing and
regulatory experts’ scientific insight and
industry knowledge. Intertek’s polymer and
plastics laboratories also help the global
chemical and polymer sectors to navigate
the challenges of product development,
regulatory authorisation, and production
through analytical testing, laboratory services,
auditing, training, and assurance services.
We are delighted to join the CEFLEX
community and help build the circular
economy for plastics and flexible
packaging in Europe. CEFLEX’s goals
resonate strongly with our own, and align
with our new CircularAssure programme,
which supports businesses to develop
recycling technologies or maximise
recycled content and ensure their
products are safe, perform well, and
meet regulatory standards.”
Ross McCluskey,
EVP Europe & Central Asia
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 19
Sustainability performance Continued
In action
Client spotlight: tru Shrimp companies combine
sustainability and safety
In action
Taking part in the Great British Beach Clean
Intertek Alchemy is helping tru Shrimp
meet food and safety regulations and
expediting audits by enabling the company
to know and demonstrate employee
training histories.
Through its patented Tidal Basin™ technology,
the Minnesota-based start-up tru Shrimp grows
mass quantities of shrimp in a controlled
environment with near-zero waste. They are
leading the way in sustainable farming by
utilising every part of its shrimp to create three
successful products: quality shrimp that is
traceable, sustainable, and antibiotic-free; a
healthy protein raw material for pet food; and
chitosan, which is derived from shrimp shells for
use in pharmaceuticals and medical products.
Tru Shrimp’s technology grows shrimp in a
controlled habitat that recreates the natural
ocean currents, focusing on reducing stress and
creating an environment where shrimp can thrive
— enabling them to grow shrimp more effectively
than conventional pond methods. In addition,
the shallow water allows for vertical farming,
requiring less space to produce more shrimp.
They do all this with the help of Intertek
Alchemy, which provides a complete training,
reinforcement, and compliance solution that
assures their people have the right knowledge
and confidence to do their jobs. The company
has embedded training as part of its culture, and
Intertek Alchemy is at the heart of that culture,
providing leadership training courses, product
and safety training through Alchemy Coach, and
the recent addition of Alchemy Playbook.
Playbook simplifies equipment and process
training so that tru Shrimp can quickly train
part-time employees, including several
people from a local group that places
workers with disabilities. Although they
are part-time, these employees undergo tru
Shrimp’s complete training, including food
safety procedures, PPE usage, and safety
measures to prevent back injuries.
Members of Intertek’s UK-based Energy &
Water team and WSP UK Ltd participated in
a beach clean event at Yaverland Beach on
the Isle of Wight in September.
The beach clean event complemented Blue Sea
Protection’s 'Great Nurdle Hunt', a foreshore
survey that is conducted to determine the
prevalence of micro-plastics (specifically
nurdles) on the beach. Along a 100m stretch
of the beach, our team surveyed the 17.8kg
of rubbish that were found and collected,
uploading the resulting information to the
Marine Conservation Society’s database for
their Great British Beach Clean annual event.
Yaverland Beach is one of many bathing
water areas at which Intertek has conducted
intensive bathing water compliance
assessments on behalf of our water utility
In action
Green Leaf certification
strengthens brand value
client Southern Water. Working alongside other
partners, Intertek’s expertise and experience
has helped Southern Water and the UK
Environment Agency develop the most
appropriate and sustainable solutions to
improve water quality and protect public
health in the area.
The Green Leaf mark for consumer goods
helps companies communicate their
environmental claims with ease and
strengthens their brand value to customers.
In India, Intertek scientists work closely with
clients in the textiles industry to help them
build confidence with customers and demonstrate
their environmental credentials. We completed
Green Leaf certification for the Manish Dye Chem
Corporation following screening for ‘syogen dc’
and ‘syogen dft’ chemicals to ensure they complied
with Substance of Very High Concern regulations
in the country. The certification from a renowned
and trusted laboratory has proven beneficial to
their brand.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
20
Sustainability performance Continued
In action
Launching new and existing pharmaceuticals
in new markets
In action
Supporting Xlinks’ Morocco-UK power
project using marine cable routing
Intertek Assuris experts are supporting our
clients in bringing existing and well-known
drugs to new markets in shorter timespans.
The development of new medicines can be a
long, multi-year process, typically involving
resource-intensive clinical trials. However, it is
often possible to bring medicines to market
more rapidly if they have been approved for
use elsewhere. In this case, an abbreviated
development pathway can be followed, making
use of available published information while
drastically reducing the scale and number of
clinical studies needed to support the
registration application.
Where a drug has been identified that qualifies
for such a process, Intertek Assuris scientists
strategise, provide advice on, identify and
assess the literature for, and author, complete,
formal registration applications. These are
submitted for regulatory review in countries
permitting this approach, including developing
countries, expediting access to much-needed
medicines with a well-established history of
therapeutic benefit and safe use.
Contributing to the UK's goal of net zero
Emissions by 2050 and providing more
consistent electricity generation from
Morocco's enhanced solar and wind
resources.
Intertek has been appointed by UK-based company
Xlinks to provide Quality Assurance and technical
advice on what will be the world's longest subsea
cable between the UK and Morocco. There will be
four subsea cables, each approximately 3,800 km
long, in twin 1.8 gigawatt cable systems, that will
exclusively connect substantial solar and onshore
wind energy facilities in Morocco with the UK
power grid.
Drawing on Intertek's knowledge and track record
of long interconnector projects, we have been
working closely with Xlinks to review marine cable
routing, draft survey and technical specifications,
assist with survey procurement, technically review
tenders, and help acquire survey permits.
Andy Page, Intertek Energy & Water's Site
Characterisation and Engineering Lead, affirmed:
"We are delighted to continue and develop our
support to Xlinks on this industry-leading project,
assisting with the realisation of this globally
important renewable energy scheme. Intertek
Energy & Water bring a wealth of technical
expertise and experience, and we look forward to
building on our track record of assuring quality and
safety in the development of long-distance HVDC
interconnectors."
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 21
Sustainability performance Continued
In action
Intertek Greater China contributes to the sustainable
development of China's largest recycled polyester producer
In action
Expanding our biodegradability
services in Mumbai
In recent years, Jiangsu Zhongyuan
Industrial Group Co. Ltd. ('Zhongyuan Group')
has been focusing on the issue of plastic
pollution in the ocean. They have been
working to promote the recycling of plastics
on all continents to participate the
environmental protection cause worldwide.
It is also among the first in China to explore the
field of sustainable renewable chemical fibres.
Designing and developing 100% renewable
chemical fibres, Zhongyuan has become the
largest enterprise producing recycled polyester
in China since 2020.
As part of these efforts, Intertek Greater China
has awarded its Green Leaf Label certification to
Recoyarns under Zhongyuan Group. The cradle-to-
door Global Warming Potential, Cumulative Energy
Demand and Water Consumption of Recoyarns
recycled polyester chip and recycled polyester
fibres were evaluated by Intertek. This showed
that their recycled polyester chips and fibres have
superior environmental benefits compared to
native fibres.
Caleb Brett’s Environmental Laboratory
in India is promoting sustainability
through its industry-leading standards
of environmental testing and innovation.
When the Indian Government banned all
Single Use Plastics – with the exception of
biodegradable and compostable plastics –
from the market, Intertek India's Caleb
Brett Environmental Laboratory in Mumbai
responded swiftly. We expanded our
existing biodegradability services to include
additional ASTM, ISO, and OECD standards, to
help businesses comply with the implications
of all waste management regulations. The
Laboratory followed this by acquiring BIS
accreditation for IS 17899 T:2022 and IS/ISO
17088:2021 testing of biodegradability, as
well as the Biodegradable Products Institute
stamp of approval.
Within months, we had analysed hundreds
of samples for more than 60 new
customers. We also signed a Memorandum
of Understanding with India’s largest plastic
manufacturers’ association, AIPMA, to create
deeper partnership within the plastics and
polymer industry.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 22
Sustainability performance Continued
In action
Safe use of recycled plastics for packaging
Intertek supports the full supply chain
involved in producing recycled materials
for food, cosmetics and medical packaging.
The global need for recycled plastics is growing,
being driven by consumer demand to minimise the
environmental impact of plastic materials, as well
as tighter global regulations and the global cost of
oil production.
The US FDA and EU EFSA regulations require
specific tests including the Challenge Test to
ensure the efficacy of the recycling process.
This is applied on a process-by-process basis,
requiring strict documentation preparation and
analytical testing. Intertek offers the Challenge
Testing Program in collaboration with Intertek
Assuris (US, China and France), Petroleum Lab,
and Intertek Analytical Laboratories. In addition,
Intertek Assuris has developed a process for food,
cosmetics and medical corporations to help them
select the recycled plastics that best meet their
product packaging performance requirements,
comply with all government regulations and have
been proven safe for their intended use.
In action
Intertek’s Government and Trade Services ('GTS')
driving sustainable trade
GTS works with governments, standards
authorities, and others involved in
international trade to improve the quality
and safety of goods traded across
international markets.
Countries without conformity assessment
programmes can face devastating
environmental risks due to poor quality or short
life span goods. Refrigeration equipment can
leak toxic gases, poor quality batteries leak
acid, and corroded cans leak oil and chemicals
into water supplies.
GTS partners with governmental departments
and direct clients to improve the sustainability of
these types of products. For example, we formed
a partnership with VeraSol, a global Quality
Assurance programme for off-grid solar products,
to ensure these products are high-performing,
safe, and durable for millions of consumers in
Africa that have no or limited access to modern
energy. Through this partnership, Intertek GTS
help promote the growth of clean, affordable,
modern energy in Africa.
We have also been playing a pivotal role in
supporting Pakistan's renewable energy goals
and low-carbon economy through the
implementation of Conformity Certification
Services. GTS India has been working with
e-commerce clients to improve waste
management, increase recycling and provide
options for customers who trade online to reuse,
repair and recycle their products. And GTS
Colombia is working with importers and
exporters of batteries, covering 85% of the
Colombian market and checking that the levels
of mercury cadmium adhere to market standards.
GTS carries out control processes related to
the re-treading of used tires, which are aligned
with ongoing control efforts that are being
developed by the Ministry of Production,
Foreign Trade, Investment and Fisheries and
the governing body in Circular Economy in
Ecuador, promoting the recycling of resources
and the efficient use.
Ministerial Agreement No. 098, issued by
MAATE, establishes re-treading as an obligation
in disposal processes, establishing Intertek as a
fundamental player by ensuring the compliance
with this provision, also contributing to the
reduction of imports and environmental pollution
caused by tyres that end up in landfills.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 23
Sustainability performance Continued
In action
Intertek SAI Global supports innovative
vertical farming business
When IAG started looking for a partner to help
develop their sustainability strategy, they turned
to SAI Global. According to IAG, the service they
received from SAI Global was both efficient and
reassuring. It has aided them to place more focus
on sustainability and environmental protection,
which are critical aspects of vertical farming.
The environmental management plan they have
created using the Red Tractor framework and
guidelines has enabled them to protect their own
farm environment, as well as find available spaces
for alternative, sustainable energy sources.
Intertek SAI Global, in collaboration with IAG, DEFRA
and the National Federation of Young Farmers
Clubs, has developed a suite of educational videos
designed to help young farmers prepare for the
future using the beneficial tools of farm assurance.
Watch here: www.nfyfc.org.uk/farmassurance
We are working with a UK-based agricultural
technology company, Innovation Agritech
Group ('IAG'), that provides cutting-edge
solutions to complement the traditional
challenges of farming.
IAG’s patented vertical farming solution, The
GrowFrame™ 360, challenges some of the biggest
issues facing modern farming: sustainability and
food security. With the collaboration of an expert
team, the company has developed and designed
indoor aeroponic growing techniques. Their
technology allows growers to not only produce an
extensive variety of fresh produce, including leafy
greens and herbs but also a range of potential
medicinal and cosmetic crops. The technology
allows fresh produce to be grown closer to their
consumer. The Growframe™ 360 can be housed
in purpose built farms or placed in repurposed
buildings which reduces the carbon footprint and
minimises environmental pollution and damage to
the environment.
Keen to demonstrate their commitment to food
safety and sustainable food production, IAG
have successfully achieved certification to the
Red Tractor Assured Fresh Produce Scheme
(incorporating a benchmark with GlobalGAP IFA
Fruit and Vegetables) carried out by Intertek
SAI Global, making them one of the first vertical
farming companies to meet the Red Tractor
Fresh Produce standards.
The certification has helped IAG to work together
towards a common goal across all areas of their
business and has bolstered their company culture
and improved their processes by providing a clear
framework as well as an effective training tool for
their new starters and clients.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Contents
Sustainability performance Continued
24
At Intertek, we understand
our organisation’s impacts on the
environment and continuously look for
opportunities to mitigate them in regard
to climate change, use of resources,
ecosystems, and waste management.
We recognise the critical role that the private sector
plays in tackling the climate crisis, providing
innovative solutions, reducing Greenhouse Gas
('GHG') emissions and setting ambitious targets.
Thereby helping to drive the transition to a
low-carbon economy.
Governance
Intertek’s environmental governance flows from
the Board to every site. To advocate for accelerated
climate action, we monitor site-level activities across
a range of metrics and work with our countries on
our net zero action plans. This process is supported
by our Environmental and Climate Change policy,
which outlines the commitments we adhere to.
Our operations apply a precautionary approach and
comply with all applicable environmental regulations
and permits.
Environmental management systems support
our operations to meet environmental protection
standards, comply with legislation and improve
reporting and transparency. We have implemented
ISO 14001and/or ISO45001 across 112 of our sites.
Environment
All of us have a
responsibility to protect
the future of our planet.
Our goal is to
decarbonise our
business by 2050.
What is our impact?
Our global reach spans thousands of employees,
clients and suppliers. This scale represents both
commercial opportunity as well as a responsibility
to our people, the communities in which we operate
and the wider environment.
As a multinational company, we recognise that,
although our own operations may not be as energy
intensive or resource depleting as other industries,
good management of the relevant and material
topics is critical to protect the environment.
Our activities around the world are diversified
across both laboratories and offices. Carbon
emissions are our biggest environmental impact, and
through continual monitoring and assessment of our
operations, we are now able to apply more targeted
actions on the reduction of our carbon footprint,
with particular focus on energy efficiencies and
operational excellence.
The energy we use in our laboratories and offices
continues to be the largest contributor to our carbon
footprint, making it a priority in our environmental
agenda.
To make real change happen, we believe that all
our people need to have ownership of their carbon
footprint and be empowered and inspired to take
ambitious actions to reduce it – putting our
Sustainability Excellence approach into action.
We continue to advance our understanding of
climate-related risks and opportunities and to evolve
our transparent reporting, in line with internationally
accepted recommendations of the Financial Stability
Board’s Task Force on Climate-related Financial
Disclosures ('TCFD').
Read our TCFD statement in Book one, pages 49 to 57
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook three Contents
Sustainability performance Continued
Our carbon emissions
reduction targets
Intertek clients depend on our safety,
quality and environmental expertise to
ensure their products and services meet
global market expectations. Intertek
will continually work on improving the
environmental performance of our
operations to minimise environmental
impacts.
Setting targets in-line with climate science
Recognising the importance of bold ambitions,
we have set targets to improve environmental
performance across our operations. Adding
urgency and ambition, our near-term targets are
aligned with a Science Based Target initiative
('SBTi') 1.5-degree pathway, which will be
delivered by achieving 50% reduction of absolute
Greenhouse Gas emissions across our Scope 1,
Scope 2 and Scope 3 (Business travel and
Employee Commuting) by 2030. In addition, we
are committed to engaging with our suppliers and
ensuring that 40% (by spend covering Purchased
Goods and Services and Capital Goods) have
science-based targets to reduce their emissions
by 2027 (both from a 2019 baseline).
Our new targets for decarbonisation represent
a determined response, and a more ambitious
vision that will meet expectations of societies
and our customers as well as inspire our
employees. Our targets are supported by strong
action plans. These were developed during both
a top-down and bottom-up exercise, building on
our emissions dashboards to clearly identify
our baseline emissions. Rigorous performance
management enables our countries to continue
delivering against their concrete and measurable
action plans to reach our reduction targets.
25
Intertek Group plc Annual Report & Accounts 2022
Strategic Report
Sustainability Report
Financial Report
Progress key
On track
In development
Achieved
2019
New Baseline for
GHG emission
reduction targets
2022
New near-term targets
set and submitted to
SBTi for validation
Incorporate ESG element
into annual incentive
framework
2030
Target: Reduce absolute Scope 1, 2 and 3
(Business travel and Employee Commuting)
Emissions 50% vs 2019 baseline
2017
First Group-wide
GHG emission reduction
target set
2021
Business ambition for
1.5 °C campaign joined
2027
Target: 40% of suppliers by spend
(covering Purchased Goods and
Services and Capital Goods) to set
science-based targets
2050
Target: Reduce absolute
Scope 1, 2 and 3 (Business
Travel and Employee Commuting)
90% vs 2019 baseline
Prioritise direct emission
reductions and consider
neutralising remaining
emissions to reach net zero
Action plans:
Scope:
1
Scope:
2
Scope:
3
Emissions from activities for operations
which Intertek owns or controls:
Emissions from purchase electricity,
heat and steam:
Value chain emissions:
Fleet efficiencies
Fleet replacements
(electronic/hybrid)
Optimisation of buildings
(heating/cooling)
Procurement from
renewable sources
Low-carbon energy generation
Energy efficient buildings
Energy efficient equipment
Optimise business travel
Engage employees on
alternative ways of commuting
Supplier sustainability
engagement
Across all scopes: Awareness and training for employees, customers and suppliers on climate change
Book threeBook oneBook two
In action
Intertek Thailand drive to efficient waste management
Since November 2021, Intertek Thailand
has encouraged colleagues to donate their
PET bottles for recycling into PPE suits for
medical teams to help prevent infection.
The project has been well received and to date,
colleagues have helped to collect more than 50kg
of PET bottles, which will be turned into more than
185 PPE suits. On their continued journey they
have now partnered with Recycle Day Thailand,
a professional waste management organisation
which promotes waste separation and helps to
reduce the amount of difficult-to-dispose-of
solid waste from the source. This project also
encourages our staff and their families to take part
in waste management to improve the environment.
At the end of Q2 more then 295kg of recycled
waste was collected which reduced 611kg of CO2.
26
Sustainability performance Continued
Our progress and performance
At Intertek, we take an ‘ever better’ approach to
ensure that our data is wholly accurate and consistent
year-on-year. Data collection continues to improve,
with over 130 users adding site-level data every
month to our Global Sustainability Environmental
software platform.
Our annual environmental reporting cycle ran from
1 October 2021 to 30 September 2022. Intertek’s
reporting complies with the methodologies outlined
by the GHG Protocol ‘Corporate Accounting and
Reporting Standard’, ISO 140064-1 and the UK
Government’s ‘Environmental Reporting Guidelines:
including mandatory Greenhouse Gas emissions
reporting guidance’. Further details on our
methodology for reporting and the criteria used can
be found within our Basis of Reporting document.
Our Basis of Reporting document is available on our
website at intertek.com/about/our-responsibility
We drive actions country by country and site by site,
with monthly performance reviews by management.
Our site-level assessments for self-generation of
electricity in several countries led to the successful
installation of nine PV projects across South Asia. As
part of our action plans further projects are being
evaluated for future implementation.
In 2022, in addition to self-generating a portion of our
electricity to meet our energy needs, we reduced our
Scope 2 carbon emissions by purchasing electricity
from verified renewable sources in various sites across
all our regions. We have also carried out further energy
audits and continue to assess replacement equipment
for energy efficiencies, as appropriate.
In the UK, we moved to a new arrangement to
purchase renewable electricity, backed by Renewable
Energy Guarantees of Origin certificates which are
traceable to the source.
Fleet electrification and a transition to low-emission
vehicles has been another focus area to reduce our
emissions. We started arrangements with fleet
management partners to phase out existing
company vehicles in the UK and North America
and replace with lower-emissions options when the
existing contracts come to an end. We continue to
monitor the developments in infrastructure across
other regions.
We are committed to improving employee commuting
to and from work by encouraging the use of
eco-friendly transport systems (such as car-pooling,
cycling, walking, using public transport) and by
subsidising mobility solutions. For example, in our
Greater China region, we provided shuttle services
for employees commuting between their workplaces
and nearby strategic points.
During 2022, we improved the accuracy and
measurement of the associated GHG emissions
from employees’ business travel by air. We recognise
that emissions from air travel are a significant
environmental impact of business travel.
We have reviewed existing travel policies to ensure
they remain appropriate for our business need and
take the environmental impacts into consideration.
Empowering employees to take action
We see our 43,500 colleagues in 100 countries
working with 400,000 clients, talking to millions of
other colleagues and friends and family, inspiring
the world to take sustainability seriously.
Empowering our employees to take action is an
integral part of meeting the challenges we face.
We emphasise learning and doing, so all of our net
zero champions as well as our Finance leadership,
have participated in workshops to understand our
activities and their impact on the climate, their role
in taking action and the science behind our targets.
We are developing more programmes, leveraging our
new LUCIE platform, to reach all of our colleagues.
64.8
tCO2e operational emissions
per £m in revenue1
1. Revenue for FY 2022 as shown in Book one, page 7.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 27
Sustainability performance Continued
Emissions (Scopes 1, 2, 3)1
Scope
Emissions
Scope 1 Direct GHG emissions
Emissions from activities for operations which Intertek
owns or controls including the combustion of fuel and
operation of facilities
Scope 2 Indirect GHG emissions
Emissions from the purchase of electricity, heat and steam
purchased for our use (location-based)
Emissions from the purchase of electricity, heat and steam
purchased for our use (market-based)
tonne CO2e2
Global
2022
2021
20193
58,821
59,952
64,709
of which UK
2,302
2,176
Global
113,823
122,036
128,693
of which UK
2,325
2,670
Global
102,066
122,147
133,860
of which UK
531
488
1. Our annual environmental reporting cycle ran from
1 October 2021 to 30 September 2022. Excludes emissions
relating to Clean Energy Associates LLC.
2. CO2e – Carbon dioxide equivalent.
3. 2019 base year emissions as submitted to the SBTi
4. Please refer to our Basis of Reporting document
for full details of scope.
Scope 3
Employee Business Travel (Air travel only)4
Global
12,555
5,771
25,849
Employee Commuting
Fuel- and Energy-Related Activities Not Included in Scope 1
or Scope 2
of which UK
813
49
Global
of which UK
Global
of which UK
33,590
36,777
67,101
1,351
7,069
213
1,112
7,068
236
7,669
Absolute tCO2e (market-based)
Global
214,101
231,715
299,188
Global energy use
Global energy use by source (MWh)
Standard electricity
Renewable electricity1
Vehicle fuels energy
Non-transport fuels energy (natural gas)
Total energy use2
Percentage of total energy use from renewable sources
1. Renewable electricity at site level is consumed from green
tarifs and self-generation (solar panels).
2. UK portion of total energy use was 7% (2021: 6.4%).
2022
2021
218,304
247,741
38,753
11,410
26,409
30,710
63,571
63,654
347,037
353,515
11.2%
3.2%
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 28
Sustainability performance Continued
Independent assurance
statement to the Directors
of Intertek Group plc
Scope
We have been engaged by Intertek Group plc
(“Intertek”) to perform a ‘limited assurance
engagement,’ as defined by International Standards
on Assurance Engagements, here after referred to as
“the engagement”, to report on selected greenhouse
gas performance data (the “Subject Matter”) on
pages 26 and 27 in Book two of Intertek’s Annual
Report & Accounts 2022 (collectively referred to
as the "Report”):
The Subject Matter comprises the following data
sets in the Report regarding the sustainability
performance of Intertek Group plc:
• Greenhouse gas emissions – Scope 1;
• Greenhouse gas emissions – Scope 2;
• Greenhouse gas emissions – Scope 3
• Fuel and energy related activities
• Employee commuting
• Business travel
• Greenhouse gas emissions – intensity ratio.
Other than as described in the preceding paragraph,
which sets out the scope of our engagement, we did
not perform assurance procedures on the remaining
information included in the Report, and accordingly,
we do not express a conclusion on this information.
Criteria applied by Intertek
In preparing the Subject Matter, Intertek applied the
methodology as described in the document Basis of
Reporting – GHG Emissions (the “Criteria”).
Intertek’s responsibilities
Intertek’s management is responsible for selecting
the Criteria, and for presenting the Subject Matter in
accordance with that Criteria, in all material respects.
This responsibility includes establishing and
maintaining internal controls, maintaining adequate
records and making estimates that are relevant to
the preparation of the Subject Matter, such that it is
free from material misstatement, whether due to
fraud or error.
EY’s responsibilities
Our responsibility is to express a conclusion on the
presentation of the Subject Matter based on the
evidence we have obtained.
We conducted our engagement in accordance
with the International Standard for Assurance
Engagements Other Than Audits or Reviews of
Historical Financial Information (‘ISAE 3000’), and
the terms of reference for this engagement as
agreed with Intertek Group plc on 14 October 2022.
Those standards require that we plan and perform
our engagement to obtain limited assurance about
whether, in all material respects, the Subject Matter
is presented in accordance with the Criteria, and to
issue a report. The nature, timing, and extent of the
procedures selected depend on our judgments,
including an assessment of the risk of material
misstatement, whether due to fraud or error.
We believe that the evidence obtained is sufficient
and appropriate to provide a basis for our limited
assurance conclusions.
Our independence and quality control
We have maintained our independence and confirm
that we have met the requirements of the Code of
Ethics for Professional Accountants issued by the
International Ethics Standards Board for Accountants
and have the required competencies and experience
to conduct this assurance engagement.
EY also applies International Standard on Quality
Control1, Quality Control for Firms that Perform
Audits and Reviews of Financial Statements, and
Other Assurance and Related Services Engagements,
and accordingly maintains a comprehensive system
of quality control including documented policies
and procedures regarding compliance with ethical
requirements, professional standards and applicable
legal and regulatory requirements.
Description of procedures performed
Procedures performed in a limited assurance
engagement vary in nature and timing from and
are less in extent than for a reasonable assurance
engagement.
Consequently, the level of assurance obtained in
a limited assurance engagement is substantially
lower than the assurance that would have been
obtained had a reasonable assurance engagement
been performed. Our procedures were designed to
obtain a limited level of assurance on which to base
our conclusion and do not provide all the evidence
that would be required to provide a reasonable level
of assurance.
Although we considered the effectiveness of
management’s internal controls when determining
the nature and extent of our procedures, our
assurance engagement was not designed to provide
assurance on internal controls. Our procedures did
not include testing controls or performing procedures
relating to checking aggregation or calculation of
data within IT systems.
The Greenhouse Gas quantification process is
subject to scientific uncertainty, which arises
because of incomplete scientific knowledge
about the measurement of GHGs. Additionally,
GHG procedures are subject to estimation (or
measurement) uncertainty resulting from the
measurement and calculation processes used to
quantify emissions within the bounds of existing
scientific knowledge.
A limited assurance engagement consists of making
enquiries, primarily of persons responsible for preparing
the Subject Matter and related information, and
applying analytical and other appropriate procedures.
The procedures we performed were based on our
professional judgement and included the steps
outlined below:
1. Assessed whether all material data sources have
been included and that boundary definitions,
(referenced in pages 26 and 27 of the Report
and outlined in the Basis of Reporting), have
been appropriately interpreted and applied.
2. Assessed whether the Intertek scope and
definitions, (referenced in pages 26 and 27
of the Report and outlined in the Basis of
Reporting), for the Subject Matter have been
consistently applied to the data.
3. Assessed whether site and business-level data
have been accurately collated by Intertek
management at a Global level, and whether there
is supporting information for the data reported
by sites and businesses in the Group to Intertek
management at a Global level.
4. Challenged the validation and collation processes
undertaken by Intertek management in relation to
the Subject Matter.
5. Reperformed calculations to check the accuracy
of the Subject Matter reported and the data
collation processes.
6. Tested underlying documentation for a sample,
based on professional judgement, of site-level
data points to determine the accuracy and
completeness of data points.
7. Examined the Report for the appropriate
presentation of the Subject Matter, including the
discussion of limitations and assumptions relating
to the data presented.
We also performed such other procedures as we
considered necessary in the circumstances.
Conclusion
Based on our procedures and the evidence obtained,
we are not aware of any material modifications that
should be made to the Subject Matter for the period
1st October 2021 to 30th September 2022, in order
for it to be in accordance with (or based on) the Criteria.
Use of our Assurance Statement
We disclaim any assumption of responsibility for any
reliance on this assurance report or its conclusions
to any persons other than Intertek, or for any
purpose other than that for which it was prepared.
Accordingly, we accept no liability whatsoever,
whether in contract, tort or otherwise, to any third
party for any consequences of the use or misuse
of this assurance report or its conclusions.
Ernst & Young LLP
London
27 February 2023
1.
International Federation of the Accountants’ International
Standard for Assurance Engagements (ISAE3000) Revised,
Assurance Engagements Other Than Audits or Reviews of
Historical Financial Information.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Sustainability performance Continued
Waste management
Intertek produces relatively small amounts of
hazardous and non-hazardous waste compared
to other industries. This includes chemicals, test
samples, paper, plastic and organic waste from our
offices and laboratories. The waste is produced in
varying proportions, determined by the industry or
industries served by each site. We operate a number of
waste management programmes across our regions.
These programmes are focused on connecting our
sites to local opportunities for minimising how much
waste we send to landfill and to increase recycling.
We continue to work on improving our reporting of
this metric.
Waste1
Waste recycled/reused
(in metric tonnes)
Waste disposed
(in metric tonnes)
2022
446
4,516
1. Data covers 135 sites across the USA and Canada.
29
Zero Waste to Landfill pilot
Recognising that reducing waste plays an important
role in the journey to net zero, we launched a pilot
project to adopt a zero waste to landfill programme.
Intertek UK aims for zero waste to landfill from its
operations by minimising the volume of waste and
material ending up in landfill and increasing reusing,
recovery and recycling rates. Using guidance from
our Zero Waste to Landfill certification programme,
this will bring benefits to our environment as well as
make our operations more efficient and resilient to
any future changes, including staying ahead of more
restrictive waste regulation changes.
The programme was rolled out to pilot sites in Q3
2022, aimed at getting a better understanding of
waste volume, streams and its final destination.
Verification is an important part of the process,
where pilot sites had to engage with waste providers
and get a confirmation from them on the percentage
of waste that is recycled, incinerated with or without
energy recovery, reused or indeed goes to landfill.
Lessons learnt are being shared during quarterly
HSE calls. The programme has been rolled out to all
Intertek UK sites in January 2023 and we will review
the effectiveness of implementation as part of
internal audit programmes.
In action
Partnering with Green Machine
to recycle more plastics
As a part of our efforts to Build Back Ever
Better, Intertek Minerals has launched a
new waste management initiative at their
Global Centre of Excellence in Perth,
Western Australia.
The new recycling programme involves
separating the majority of the polystyrene,
polypropylene, and high density polyethylene
plastics used at the laboratory from their
general waste. We are partnering with Green
Machines Lab, a Perth based company that
recycles plastics to be reused within Australia,
and will ensure the plastic doesn’t end up
in landfill. When the programme is fully
operational in all areas of the laboratory,
Intertek Minerals Perth anticipates that they
will recycle more than 1.5 tonnes of plastic per
month, and they intend to roll this initiative out
to other Intertek laboratories across Australia.
Our Minerals Global Centre of Excellence was
built with sustainability in mind, and this latest
waste management initiative complements
other sustainability initiatives at the facility –
including a 990kw solar system, one of the
largest rooftop solar installations in Western
Australia, that currently provides on average
a third of the daytime power required by the
laboratory. The facility also captures and
recycles laboratory wastewater to conserve
this precious resource.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Contents
Sustainability performance Continued
30
Communities
Creating positive impacts
in the communities where
we operate.
Our global business spans more than 100
countries and, as such, we understand
the huge opportunity and responsibility
we have to make a positive and lasting
impact on our local communities where
we work.
Taking active responsibility to support the societies
where we operate is grounded in our Values to create
sustainable growth. For all.
As a business we contribute to our communities in
many ways. We provide employment opportunities,
volunteer, fund education programmes and support
charities to benefit local communities and
neighbourhoods.
Each of our countries and business lines define their
own agenda to create positive and lasting impact.
These are tied to the Group’s priorities and aligned to
the UN Sustainable Development Goals, and focus on
their local operations and communities. Our Beyond
Net Zero Steering Committee oversees community
investments at a global level.
In this section we provide a small selection of
highlights from the many community activities that
our colleagues are taking part in around the world.
Over 100
Community projects our employees
participated in focusing on education,
giving back to local communities and
preserving our environment
13,710
hours volunteered to support
community projects
• Crafty Charity Shop is a group of volunteers
who raise funds for other partner charities;
• Feeding Hong Kong is a food bank that aims to
reduce food waste by rescuing surplus food and
redistributing it to people in need;
• Gingko House advocates senior employment;
• Hong Kong Seeing Eye Dog Services promotes
professional guide dog services; and
• Ibakery trains and hires people with disabilities,
to produce quality bakery products.
In action
Celebrating the Year of
the Tiger in Hong Kong
To ring in the Chinese New Year in February
2022, Intertek Hong Kong celebrated with
our customers by distributing charity
hampers through seven local charities.
Welcoming the arrival of a Lunar New Year full of
happiness and prosperity, Intertek joined hands
with local charities to support a good cause –
presenting beautiful hampers, packed with
goodies like a traditional cloth tiger, a house plant,
a coaster, fair-trade snacks, floral tea and a bottle
of essential oil. We are pleased to work with these
charities, each of which strive to promote mental
health, employment opportunities for senior
citizens and young talents with special needs,
and support under-privileged families:
• Blossom Minds offers employment opportunities
for young adults with special needs;
• Career provides job-matching services to people
with disabilities and special educational needs;
In action
Intertek and GAIN help
combat malnutrition
In action
The buzz around
sustainable honey
Intertek Food Services team partnered with
the Global Alliance for Improved Nutrition,
who tackle malnutrition in developing
countries by transforming food systems,
working with governments, international
agencies, NGOs and the private sector.
Intertek Food Services provides audit,
inspection, and testing services to assure the
quality of affordable, vitamin-rich premix
blends which are used globally to help fight
malnutrition.
In 2022, Intertek Food Services offered
a limited release of The Hive, a social
community for the honey industry to share
ideas, trends, and best practices. A driving
purpose of The Hive is to guide a sustainable
approach to the growth of the honey industry
by mitigating fraud, promoting responsible
apiary practices, and keeping consumers safe
when they purchase honey products and
pharmaceuticals.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook three Sustainability performance Continued
In action
Supporting Rotary's
PolioPlus project
Intertek Bremen is helping to defeat polio
by recycling plastic more effectively.
31
Since 1985, Rotary has invested hundreds of
millions of dollars in their effort to rid the world of
the polio virus. However, their PolioPlus project is
not just about eradicating polio, it is about the
many added benefits their work brings, such as
providing access to clean water, additional medical
treatment, and improved hygiene.
When colleagues at Intertek Bremen started
collecting plastic lids made of polypropylene and
polyethylene, they ensured they were sent for
proper recycling, and received money back for
doing it. All proceeds were donated to PolioPlus,
doing their bit to defeat polio.
In action
Intertek volunteers take part in flood relief work
In July 2022, volunteers from Intertek
Bangladesh contributed to relief activities
in Sunamganj district, one of the areas in
Bangladesh worst affected by devastating
flash floods.
This year, more than seven million people have
been severely affected by flash floods across
nine north-eastern districts of Bangladesh:
Sylhet, Sunamganj, Moulvibazar, Habiganj,
Kishorganj, Netrakona, Brahmanbaria,
Mymensing and Sherpur. The greatest damage
to life, in terms of deaths, injuries and diseases,
was in the Sylhet and Sunamganj districts.
Colleagues from Intertek Bangladesh helped
flood victims by donating towards their basic
needs and essentials. Volunteers from the
company also travelled almost 270km from
Dhaka city to the flood-affected areas to
participate in the relief efforts. They helped
around 350 families from five villages – Mainpur,
Haluaghat, Rahmaatpur, Jagannathpur and
Vatgoan – making an important contribution
to the relief efforts in Surma Union.
In action
Supporting the Uvalde community
as it tries to recover from tragedy
The City of Uvalde in South Texas became
the subject of international headlines in
May 2022, following a school shooting that
claimed the lives of 19 children and two
beloved educators.
Colleagues at Intertek San Antonio have been
doing everything they can to support the
Uvalde community following the tragic events
that unfolded at the Robb Elementary School
this year. Our campuses were all awash with
the colour maroon on 10 June, reflecting the
school’s colours. This was part of 'Maroon Day',
sponsored by Intertek Automotive Research,
which also served as the Kick-Off for our Food
Drive, as we collected for the San Antonio Food
Bank to help families in the Uvalde area in
these tough times.
Intertek colleagues like Amanda Villasenor
volunteered to help pass out food, drinks, and
other items to the community in what has been
an extremely emotional period for her and so
many others. The San Antonio Food Bank
offered vital items such as milk, water, baby
wipes, bread, and frozen meats to those in
need. Soft toys were offered as therapy tools
for grieving families. With the blood supply in
the South Texas healthcare system already at
a critical low before the tragedy, we have also
encouraged our employees to donate blood,
platelets or plasma.
Amid the unbearable grief, there is an
incredible desire for healing in the community,
and for its people to stay strong. As part of
'Maroon Day' itself, Intertek employees made
a 'Uvalde Strong' garden sign and this was
delivered to the Robb Elementary School.
Being there and meeting people affected by
the tragedy was a sad and moving experience,
but helping more than 200 families on the
day made it a very fulfilling event for all
our volunteers.
In action
Caring for the elderly
through our 'WE CARE’
initiative in Malaysia
Over the past year, colleagues from
various business lines and departments
have came together as one to visit the
Rumah Victory Elderly Home, an old
people's home located in Puchong, Selangor.
During their visits, part of Intertek Malaysia’s
‘WE CARE’ initiative, our team helped to clean
different areas of the home, including the
bedrooms, common areas, bathrooms and kitchen,
helping the elderly residents to live a healthier,
cleaner life. Intertek Malaysia is committed to
supporting the elderly community and will
continue to help through various CSR projects
to show that WE CARE.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 32
Sustainability performance Continued
In action
Intertek People Assurance
working for social good
In action
Turning electronic waste
into social good
In action
UK colleagues participate in Ever Better Day
Colleagues across Intertek Wisetail,
Intertek Catalyst and Intertek Alchemy
have all been engaged in work this year
to improve the environment and improve
people’s lives.
Intertek France's IT department has
set up a partnership with the French
charitable association Les Restos du
Coeur to help us dismantle and reprocess
our IT waste.
Les Restos du Coeur is dedicated to fighting
against poverty and all forms of exclusion in
France. The association looks to help and assist
the most impoverished in society, but in broader
terms, they are there to help everyone in need.
We are working with them to help turn our
electronic waste into social good. That’s why
in 2022 we sent our old mobile phones to the
Yvelines Integration Centre managed by Les
Restos du Coeur. The old phones will be
reprocessed and recycled where possible,
making a contribution to the work done by
Les Restos du Coeur. We are now looking to
extend this approach to electronic waste
reprocessing across all our French offices
and to other equipment.
Many of our Intertek Wisetail employees
have spent some of their time volunteering
to support local conservation projects, or
simply picking up trash in their local parks.
At Intertek Catalyst, we held our 8th annual
Creative Day for Social Good, where almost
100 volunteers and design students
gathered to provide 11 charities from across
the country with professional marketing
materials at no cost to them. During the
year, the Intertek Catalyst Leadership
Team were all certified in Mental Health
First Aid through the Mental Health
Commission of Canada to help them
better support our people.
And our Intertek Alchemy team in Austin,
Texas, demonstrated that green business
is good business. They took part in the
Austin Green Business Leaders Program,
which helps businesses get recognised for
their contribution to the community,
addressing the climate crisis and protecting
the environment. Businesses that excel in
the programme are formally recognised as
Silver, Gold, or Platinum Green Business
Leaders, giving them a competitive edge with
customers. We were delighted that Intertek
Alchemy achieved a Gold rating in this year’s
programme.
This year, our colleague volunteering days
in the UK (known as Ever Better Days) have
supported various Science, Technology,
Engineering and Mathematics ('STEM')
initiatives, community regeneration and
community groups.
Across our 50+ sites in the UK, our colleagues
have always been passionate about supporting
their local communities and making them a
better place. That’s why we introduced the
Ever Better Day in 2020, giving each of our
UK colleagues the opportunity to spend a day
volunteering and giving back to a cause or
community that’s important to them.
Jonathan Berry, Marketing Business Partner,
Transportation Technologies, used his Ever
Better Day to be the live sound engineer
for Sutton’s Trinity Scout and Guide Group’s
‘Trinity Gang Show’ performance. The show
raises money for the local Guiding and Scouting
groups, funding minibuses which take the
children to camps and residential weekends
throughout the year. Over three performances,
the show generated £3,700 from ticket sales,
refreshments and video sales.
Alana Milne, Key Account Manager in our E&P
team, spent her Ever Better Day supporting
TechFest, a Scottish charity that runs STEM
events and activities for young people and the
wider community. Alana was proud to volunteer
to help with TechFest’s annual festival of
Science, Technology, Engineering and
Mathematics. The week-long event included
a diverse range of interactive activities and
events with presentations, workshops and
speakers covering topics from ‘how to make
ice-cream’ to ‘who polluted the river.’
Joyce Moore, PPE Technical Manager in our
Softlines team, recently completed her Ever
Better Day volunteering with her local Girl
Guides. Along with two other adults, Joyce
took a group of 15 girls aged between ten
and 13 on a water camp at Leicester Outdoors
Pursuit Centre. There were around 220 girls
there, taking part in a range of activities
including raft building, canoeing, bell boating,
kayaking, bushcraft, climbing, high ropes,
archery and crafts.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 33
Responsible Business Practices
To deliver long-term sustainable
success we strive for the highest
standard of corporate governance,
conduct and integrity.
Our entrepreneurial culture and Values to make the
world better, safer and more sustainable are at the
core of everything we do.
Our responsible business practices – protecting
human rights, 'Doing Business the Right Way',
ensuring data privacy and good information
governance and operating sustainable procurement
practices – underpin our focus areas and the
commitments we have made.
Human rights
Within our business, respecting human rights is core to
our responsible business practices and is implemented
through our Labour and Human Rights policy, Code of
Ethics and Sustainable Procurement policy. Intertek’s
policies and codes are based on and fully respect
the International Bill of Human Rights and the
International Labour Organization’s declaration on
Fundamental Principles and Rights at Work and the
Children’s Rights and Business Principles.
We are committed to ensuring that our employees
are subject to fair working practices and are treated
with respect. We continually review our approach
to human rights to reflect legal developments,
emerging issues and to meet societal expectations.
We uphold and respect human rights in many ways,
including:
• Working conditions: We comply with all
applicable labour and human rights laws and
industry standards on working hours, paid
annual vacation, rest periods and statutory
minimum wages.
• Indigenous rights: We respect the rights of
indigenous people. Our goal is to support our
leaders, our people and our communities to
develop respectful relationships and create
meaningful opportunities with indigenous people.
• Forced labour: We do not tolerate any form
of forced labour, child labour, slavery, human
trafficking, physical punishment or other abuse.
Our Modern Slavery Act Statement, outlining the
steps we are taking internally, in our supply chain
and through partnerships and advocacy to avert
modern slavery and human trafficking is available
on our website.
• Child labour: We do not employ people below the
age of 15 or below the local minimum employment/
mandatory school age – whichever is higher and
relevant to the particular country. Where we
provide apprenticeships for young people, we put
special protections in place and ensure they are
not exposed to hazardous work.
• Collective bargaining: We respect the rights of
our employees to form and join trade unions and
take part in collective bargaining where this is
accepted by local law. We also take care that
employee representatives do not suffer
discrimination and that they have open access to
members in the workplace. We strictly adhere to
tariff structures and arrangements negotiated
with trade unions, while we also inform and consult
employees on relevant business activities, for
example, we respect statutory minimum notice
periods and give reasonable notice of any significant
operational changes in-line with local practices and
labour markets. Our affiliates’ communication and
consultation processes are tailored to local needs.
Our Code of Ethics training aims to educate all
employees about potential integrity issues, including
human rights, bribery, corruption, non-discrimination
and employee relations. The Code of Ethics contains
clear guidance on the grievance mechanisms and
whistleblowing procedures that we have in place.
Read more on our whistleblowing procedure
on pages 34 and 76
In action
Intertek Australia’s Reconciliation Action Plan
At its heart, reconciliation is about
strengthening relationships between
Aboriginal and Torres Strait Islander
peoples and non-Indigenous peoples,
for the benefit of all Australians.
As a leader in our field of industry, in Australia,
Intertek acknowledges and accepts the role
we should and must play in working towards
Reconciliation in Australia. We also have a role
to play in protecting and promoting the human
rights of Aboriginal and Torres Strait Islander
people and ensuring they are treated fairly and
equitably before the law. We as an organisation are
committed to ensuring, our Reconciliation Action
Plan (‘RAP’) is a meaningful and living document
that guides and informs our organisational
governance, processes, and work. It provides us
with a strategic, clear and measurable framework
for translating our commitment into action.
Since the adoption of our RAP, we are proud of the
contribution to reconciliation both internally and in
the communities in which we operate that we have
made so far. This includes employment outcomes
for indigenous Australians, youth engagement in
STEM programmes and Intertek facility tours,
face-to-face and online cultural learning, increased
expenditure to indigenous owned organisations,
formal and informal partnerships and endorsing
other RAP organisations.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
34
Responsible Business Practices Continued
Doing Business the Right Way
We continue to develop a best practice compliance
programme to ensure Intertek operates with the
highest standards of compliance and ethical business
practices, including through our supply chain partners.
We are committed to maintaining the total
confidence of our stakeholders. One of the Group’s
primary business objectives is to help our customers
meet quality standards for virtually any market in
the world and protect them against risk by ensuring
compliance with local, national and international laws.
The accuracy and validity of reports and certificates
that we provide are therefore important factors
which contribute to our success. Integral to this is
‘Doing Business the Right Way’; our internal risk,
control, compliance and quality programme.
Our compliance programme ensures:
• that our people have the processes, tools and
training they need, and work to ensure a safe
and inclusive environment;
• the services we provide and the contracts we
enter into are delivered with integrity and in line
with our commitment to Total Quality;
• every colleague commits to the highest standards
of professional conduct; and
• we deliver sustainable growth by managing our
risks and doing the right thing for the longer term.
Public policy
We interact with trade associations and
governmental authorities to provide input into
industry and regulatory improvements in product
safety, quality and risk assurance. Any interactions
with governments, governmental authorities or
regulators are reviewed by our Group Legal & Risk
functions to ensure that we comply fully with all
laws and regulations.
Ethics, integrity and professional conduct
Our commitment to the highest standards of
integrity and professional ethics is embedded in
the Group’s culture through the integrity principles
set out in our Code of Ethics (‘Code’). It sets clear
expectations that people working for our business
must act at all times with integrity and in an open,
honest, ethical and socially responsible manner.
The Code also covers health and safety, anti-bribery,
anti-competitive practices, labour and human rights.
The Board, as a whole, oversees the implementation
of human rights commitments and supports human
rights as defined in the Code.
We have a culture in which all issues relevant to our
professional conduct and the Code can be raised and
discussed openly without recrimination. We operate
a strict zero-tolerance policy regarding any breach
of our Code and any behaviour that fails to meet our
expected standards of integrity as a trusted leader
in the Quality Assurance industry.
Internal Audit is responsible for reviewing and
assessing Intertek’s business processes and provides
independent and objective assurance and advice that
adds value and improves our internal control systems
and operations.
To support this policy in action, all people working for,
or on behalf of, Intertek are required to sign the Code
upon joining the Group or before commencing work on
our behalf. This confirms their acceptance of the high
standards expected of them in all business dealings.
100%
of our colleagues are required to
complete our Code of Ethics training
Intertek employees or people acting on Intertek’s
behalf are responsible for applying the Code in their
own job role, their part of the business and location.
Every year, to support the continuing understanding
in this area, all of our people are required to complete
our comprehensive training course.
This training covers the Code and other important
professional conduct areas, such as data security and
operational controls. When completing the training, all
employees are required to sign a certificate confirming
their understanding that any breaches of the Code
will result in disciplinary action that may include
summary dismissal of the employee concerned.
Whistleblowing hotline
To empower our people and stakeholders to voice
any concerns about breaches of the Code or any
of our policies (including our Labour and Human
Rights Policy and Modern Slavery Policy), we have
a well-publicised hotline which can be used by all
employees, contractors and others representing
Intertek, or by third parties such as our customers
or people who are affected by our operations.
This whistleblowing hotline is run by an independent,
external provider. It is multi-language and is
accessible by phone and by email 24 hours a day.
Those concerned are encouraged to report any
conduct, compliance, integrity or ethical concerns
using the hotline. Information posters are present
in all of our sites.
If a report is made to the hotline, it is followed up by
Intertek’s Compliance officers. Our Group Compliance
function, which is independent of our operational
businesses and reports directly to our Group General
Counsel, fully investigates all reports received.
Provided there is no conflict of interest, all reports
are also notified immediately to our Group Ethics &
Compliance Committee, which consists of our CEO,
CFO, EVP for HR and Group General Counsel. This
ensures the effective resolution both of individual
issues and of any systemic or process improvements
that can be made to address them.
During 2022, 91 reports of non-compliance
with the Code were made to our hotline. Of
those reports, 24 were substantiated or partially
substantiated and required remedial action. Of
those substantiated claims:
• there were no substantiated grievances relating
to human rights, labour practices or societal
impact breaches;
• there were no environmental incidents;
• there were no anti-trust incidents reported;
• there were no reported violations of the rights
of indigenous people; and
• there were no cases of discrimination.
Six confirmed incidents were identified through
our hotline where employees were disciplined or
dismissed due to non-compliance with our
anti-corruption policy.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Responsible Business Practices Continued
Sustainable procurement
We are deeply committed to operating with integrity
by ‘Doing Business the Right Way’ and to pursuing
our corporate social responsibility activities through
living our strong Values. Our suppliers have an
important part to play in contributing to our
sustainability.
Our sourcing approach
We work with thousands of suppliers around
the world. We expect all suppliers to meet the
same internationally recognised human rights,
environmental and quality standards that we
expect of our own businesses. These include
meeting local legislative requirements but also
applicable international requirements for workers’
welfare and conditions of employment, such as those
set by the International Labour Organization (‘ILO’)
and the Ethical Trading Initiative.
Large global suppliers offer stability in terms of
financial resilience, delivery capacity and pricing
structures, potentially coupled with better pricing
and improved margins. However, our supply chain is
quite diverse and geographically dispersed, and our
procurement teams need to find regional and local
suppliers. Through structured sourcing processes,
we select the best option for us while continuing to
support local suppliers that meet our business and
sustainability requirements. Selecting regional and
local suppliers, where appropriate, demonstrates our
commitment to supporting the communities in which
we operate.
35
Evaluation of suppliers
Our corporate procedures govern our purchasing and
evaluation of vendors and sub-contractors supplying
Intertek with goods and services.
Approval and evaluation may be based on quality,
health and safety, environmental performance and
delivery. Performance is also measured, recorded and
benchmarked against established objectives as part of
our disciplined performance management principles,
supported by our Quality Management System.
Enterprise Security
At Intertek we have adopted a risk-based security
framework, based on international best practice,
NIST CyberSecurity Framework. Our framework
guides clear policies, standards and supporting
guidelines, controls and hiring. We continue to
innovate, enhancing service delivery and
strengthening internal and external customer
relationships to protect customer, employee
and Intertek data.
To strengthen our supplier sustainability programme,
during 2022, new paths were laid out to broaden our
approach to one that manages sustainability in a
more integrated fashion with a supplier life cycle
perspective and incorporating sustainability criteria
at procurement category level. We aim to integrate
sustainability criteria into more phases of the
supplier engagement life cycle including positive
supplier screening and preferring suppliers with
above average sustainability credentials.
As a step in this direction, we launched a pilot
programme in 2022 conducting sustainability
specific due diligence through a self-assessment
and documentation review.
Going forward we will be looking at the
environmental attributes of different procurement
categories and investigating if we can already take
steps to choose our suppliers based on their
environmental and climate performance.
Our Sustainable Procurement policy is available
at intertek.com/about/our-responsibility
There is regular reporting on progress of the
security programmes to governance and oversight
committees by our dedicated Chief Information
Security Officer, who leads a global team.
>
Identify
Protect
>
Recover
Our
risk-based
security
framework
>
Detect
>
>
Respond
Identify
We develop a clear organisational understanding
of risks to our systems, people and data, enabling
us to prioritise efforts that are consistent with our
risk management strategy and business needs.
Protect
We put in place appropriate safeguards to ensure
delivery of critical services, including access control,
staff awareness and training, and data security.
These safeguards support our ability to limit or
contain the impact of potential events.
Detect
We define the appropriate activities for the timely
discovery of the occurrence of security events. We
monitor continuously and verify the effectiveness
of protective measures including network and
physical activities.
Respond
We ensure response planning processes are
executed during and after an incident, so that
we take appropriate action regarding situations
and contain their impact. We also implement
improvements, by incorporating lessons learned from
current and previous detection/response activities.
Recover
We undertake appropriate activities to maintain
plans for resilience and to restore any capabilities or
services that were impaired due to an incident. Our
recovery function ensures timely recovery to normal
operations to reduce the impact from an incident.
Data protection
We believe that all our people and all our customers
have the right to data privacy, and so we have
adopted the best practices and standards set out
in the General Data Protection Regulation (‘GDPR’)
across all of our markets and operations, and in
relation to all individuals whose personal data we
obtain and use (not just individuals in the EEA).
Our Group Data Protection Policy is aligned with
the GDPR requirements to set out the minimum
data protection standards we apply throughout
our operations so that we use all personal data
transparently, fairly and securely.
To ensure implementation, and to remain
uncompromising on Quality and Compliance, our Core
Mandatory Controls framework forms the mechanism
to define, monitor and achieve consistently high
standards. Control and oversight is provided through
our CyberSecurity Team, Group Legal & Compliance
and the Internal Audit team. We have mandatory
training on data privacy for all employees and global
data breach response processes.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
36
The Directors present their report and the audited
consolidated financial statements for the year ended
31 December 2022 in Book two and Book three.
directors'
This report has been
prepared in order to
provide all stakeholders
with a comprehensive
understanding of
how our governance
framework supports our
Science-based Customer
Excellence approach.”
Andrew Martin
Chairman
report
Chairman's introduction
to Corporate Governance
38 Chairman's letter
40 Board of Directors
43 Direct reports to the CEO
Board Leadership
and Company Purpose
44 Effective and entrepreneurial Board
44 Purpose, values, strategy and culture
47 Governance framework and Board
activities in 2022
52 Stakeholder relations
53 Workforce engagement
Evaluation, Composition
and Succession
65 Board evaluation
67 Board appointments
70 Board skills, experience and knowledge
Audit, Risk and Internal Control
72 Financial reporting; external auditor
and internal audit
75 Fair, balanced and understandable
assessment
76 Internal financial controls; risk management
Remuneration
62 Investor and shareholder engagement
78 Linking remuneration with purpose,
Division of Responsibilities
63 Roles and responsibilities
64 Independence
64 External commitments and
conflicts of interest
values and strategy
80 Remuneration Policy
94 Performance outcomes for 2022
Board promise
We recognise our responsibility to
all stakeholders and will strive to ask
the questions that matter and make
the right decisions.
We will be forward looking and use
our diverse perspectives and insights to
promote Intertek’s Purpose of bringing
Quality, Safety and Sustainability to life.
We will inspire our people to
take client relationships and our
performance to greater heights and
to create sustainable growth for all.
1
2
3
Book oneBook threeBook twoIntertek Group plc Annual Report & Accounts 2022Financial ReportSustainability ReportStrategic ReportContents Governance structure
We are deeply committed to our
sustainability agenda. Underpinning
the delivery of our sustainability
strategy is a strong governance
structure, to deliver sustainable
value for all our stakeholders,
in particular our customers,
employees, shareholders,
regulators and communities.
Our Board of Directors is responsible for the
overall stewardship of the Group and delivery against
strategy, through our Leadership Team. This includes
setting our Purpose, Values and standards.
Sustainability governance is delivered by two
workstreams: the Net Zero Steering Committee and
the Beyond Net Zero Steering Committee. The Net
Zero Steering Committee is chaired by the CEO and
comprises the Head of Sustainability, Chief Financial
Officer, Head of Finance-Sustainability and the Group
General Counsel. It focuses on the development,
implementation and performance of our net zero
roadmap and our science-based emission reduction
targets to get us to net zero by 2050.
The Beyond Net Zero Steering Committee, which
is also chaired by the CEO, comprises the Head of
Sustainability, SVP Corporate Development Group,
EVP Marketing and Communications, Director Group
Corporate Communications and the Group General
Counsel. This Committee focuses on the overall
delivery against our sustainability strategy.
Both Committees meet on a bi-monthly basis.
To support the efforts of the Steering Committees,
formal and informal committees led by regional
management across the Group help to disseminate
and drive our sustainability strategy across the regions
for our people, the communities in which we operate,
the environment and our customers.
37
Board
Nomination Committee
Audit Committee
Remuneration Committee
Leadership Team
Risk Governance
Sustainability Governance
Group Risk Committee
Ethics and Compliance
Committee
Net Zero Steering Committee
Beyond Net Zero
Steering Committee
Regional, divisional and
functional committees
Disclosure Committee
Regional management,
Net Zero Champions
and finance
Regional Sustainability
Committees, Regional HR
and Marketing, and
Sustainability Champions
Group Investment Committee
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
Contents
Chairman's introduction
38
Intertek Group plc Annual Report & Accounts 2022
Book one
Book two
Book three
Strategic Report
Sustainability Report
Financial Report
On behalf of the Board, I would like to express our
appreciation to the entire workforce. The strength
of the business reflects their incredible hard work
and commitment."
Andrew Martin
Chairman
Dear shareholder
We began 2022 looking forward to a period of
recovery as we emerged from the worst of the
pandemic. However, it turned out to be a year
of considerable instability with continuing
reverberations from Covid-19, particularly in
China, economic headwinds, conflict in Ukraine
and unprecedented levels of inflation.
Against this challenging backdrop, my Board
colleagues and I are very proud of what our
people have achieved. With a culture focused
on our Purpose of ‘Bringing quality, safety and
sustainability to life’ and led by a management
team dedicated to growth and strategic
execution in a market with attractive
fundamentals, our proven business model
delivered 2022 revenues of £3.2bn, up 14.6%
at actual rates on 2021 and higher than
pre-Covid levels recorded in 2019.
During and since the pandemic, we have been
very cognisant of the importance of supporting
our great people and, in turn, continuing to
provide best-in-class services to our clients.
Although we saw some pressure on margins
because of the rapid increase in inflation and
the Covid-induced shutdown of our Chinese
business, we are delighted at how the business
has performed.
Our cash performance remained strong enabling
us to invest in growth initiatives and respond to
client demands. We continued to devote funds
to innovation and I would like to highlight three
that once again demonstrate our focus on
sustainability and how we are developing
services aligned with our Purpose and mission.
First, CircularAssure, a programme of assurance,
testing and certification services helping plastics
companies move towards a circular economy;
second, the Think Green Initiative audit
programme that is part of our commitment to
assisting companies to tackle climate change;
and third, Intertek Hydrogen, which provides
end-to-end quality, safety and sustainability
assurance across the entire hydrogen value chain.
SAI Global Assurance, the leading provider of
assurance services acquired in 2021, is now fully
integrated and made a significant contribution
to performance. In 2022, we were pleased to
welcome Clean Energy Associates, which brings
important new capabilities and additional
capacity providing assurance services in the solar
energy and energy storage markets to support
our customer offering in the World of Energy.
We have retained our financial discipline: our
balance sheet remains strong with net debt
of £738m while our return on capital for 2022
was 18%.
In line with our dividend policy, the Board is
proposing a final dividend of 71.6p, making an
unchanged full-year dividend of 105.8p and
a dividend payout ratio of 50%.
39
customers. The Board felt the enthusiasm of our
colleagues in India for the tremendous opportunities
for the future. I also visited operations in the UK,
Italy, Canada and the USA and had a virtual meeting
with the team in Dubai.
The Board received regular feedback on meetings with
investors throughout the year and last Spring I met
with a number of leading institutional shareholders.
Diversity in all forms leads to more productive and
balanced discussion. I am pleased that today, the
Board complies with the provisions of both the FTSE
Women Leaders Review on gender diversity and the
Parker Review on ethnic diversity. Half of the Board’s
Non-Executive Directors are women and two identify
as non-white. And we are making encouraging
progress on equity, diversity and inclusion through
the organisation.
I am delighted Jez Maiden joined the Board on
26 May 2022. Jez brings significant experience as
an international public company CFO across different
industries and has also joined the Audit Committee.
We welcomed Kawal Preet, with her 25 years of
experience as a leader and senior executive in Asia
Pacific, the Middle East and Africa, to the Board on
31 December 2022. Both Jez and Kawal are strong
additions to the Board and bring important new skills
and knowledge.
As Chairman, I am responsible for ensuring the
effectiveness of the Board, its Committees and
individual Directors. The evaluation and performance
review of the Board was internal this year. The
evaluation concluded that the Board and its
Committees are performing effectively, with clear
and appropriate terms of reference, policies and
processes; have the necessary information and
resources provided and time allocated for discussions
to function effectively; and have an appropriate
balance of skills, experience and knowledge to
encourage challenge and debate.
Chairman's introduction Continued
People
I have already referred to our culture which I see as
crucial to accelerating the delivery of our strategy
and providing competitive advantage. Despite facing
continuing challenges from Covid-19, I am constantly
impressed by our people’s energy, enthusiasm and
commitment to our Values.
As a customer focused business, our people are key.
I am convinced that we have the best people in the
industry, delivering our mission through exemplary
service to our customers and producing the best
results for our shareholders. I have been particularly
impressed by our ability to leverage the scale and
capabilities of the Group whilst ensuring local agility
to remain able to meet the demands and requirements
of our customers. Local knowledge and proximity to
our customers is key, and the leadership of most of
our businesses around the world, is largely comprised
of people from the respective regions or countries.
Business line leadership is strongly influenced by
expert knowledge of the relevant business line.
On behalf of the Board, I would like to express our
appreciation to the entire workforce. The strength of
the business reflects their incredible hard work and
commitment. Their efforts have and will continue to
underpin our performance as we manage the current
market conditions and grasp the significant growth
opportunities we see.
Governance and the Board
One of my key responsibilities as Chairman is to
ensure good corporate governance, which I firmly
believe underpins the sustainability of our business
and delivery of our strategy. In this regard, I would
like to thank my fellow Board members for their
unstinting support.
The pandemic saw the Board learn to operate
differently and although we recognise the benefits
from the use of technology to enable virtual
meetings, we all agree that it is no substitute for
face-to-face engagement. Alongside our scheduled
Board meetings, for the first time since 2019 we held
a physical Board meeting overseas in Delhi where we
met senior management from South Asia, the Middle
East and sub-Saharan Africa and visited important
Outlook
As we look to the future, I am confident that Intertek
is in a strong position given the increased demand for
our ATIC solutions. We have aligned our clear Purpose
and strong culture to leverage the capabilities and
expertise of our great people in order to take
advantage of the significant structural growth
opportunities we see globally in the assurance,
testing, inspection and certification industry. This
will enable us to continue to deliver sustainable
growth and value for all stakeholders.
As we look to the
future, I am confident
that Intertek is in a
strong position given
the increased demand
for our ATIC solutions."
Compliance with the 2018 UK Corporate Governance Code (‘Code’)
This is more than the pension contribution of
the majority of the UK workforce. Regardless of
the obligations outlined in the CEO’s contract,
agreement was reached with the CEO to reduce
his pension from 30% of base salary to 5% over a
period of five years starting from 2021, and from
1 June 2023, the pension contribution will reduce
to 15% of base salary. More information on the
engagement with shareholders on this issue
is outlined in the letter from the Chair of the
Remuneration Committee in the 2021 Annual
Report & Accounts.
A more detailed explanation of our compliance can
also be found on our website at intertek.com. The
information required to be disclosed in accordance
with DTR 7.2.6 can be found in the Other Statutory
Information section on pages 104 to 107.
This report has been prepared in order to provide
stakeholders with a comprehensive understanding
of our governance framework and to meet the
requirements of the Code, the Listing Rules (‘LR’)
and the Disclosure Guidance and Transparency
Rules (‘DTR’). A copy of the Code is publicly
available at www.frc.org.uk.
Page 36 sets out how this section has been
structured around the Code Principles.
The Board confirms that during 2022, the Company
has consistently applied the principles of good
corporate governance contained in the Code and
has complied with the provisions apart from
Provision 38. Provision 38 stipulates that the
pension contribution rates for Executive Directors
should be aligned with that of the workforce.
The pension contribution for all new Executive
Directors appointed to the Board since 2018 has
been aligned with that of the workforce. However,
when the current CEO joined Intertek in 2015, and
prior to the introduction of provision 38 in the Code
issued in 2018, his contract stipulated a pension
contribution of 30% of base salary per annum.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 40
Board of Directors (Tenure is given as at 31 December 2022)
Former Directors who served
during the year
No Directors left the Board during 2022.
1
Andrew Martin
Chairman
Appointed to the Board in May 2016;
appointed Chairman in January 2021
Committee: N
Nationality:
Ethnicity: White
Tenure: 6.5 years
Independent: Yes
2
André Lacroix
Chief Executive Officer
3
Jonathan Timmis
Chief Financial Officer
Appointed to the Board in May 2015
Appointed to the Board in April 2021
Committee: N/A
Nationality:
Ethnicity: White
Tenure: 7.5 years
Independent: N/A
Committee: N/A
Nationality:
Ethnicity: White
Tenure: 1.75 years
Independent: N/A
Current principal external appointments:
Non-Executive Chairman of Hays plc and a Non-Executive
Director of the John Lewis Partnership Board.
Current principal external appointments:
None.
Current principal external appointments:
None.
Key strengths:
• Wide-ranging and extensive financial background.
• Extensive experience of the travel, hospitality and
support services sectors.
Experience:
Andrew was Group Chief Operating Officer for Compass
Group plc until 2015, and prior to that, he served as their
Group Finance Director for eight years until 2012. Before
he joined the Compass Group, he was the Group Finance
Director at First Choice Holidays plc (now TUI Group).
Andrew also previously held senior financial positions
with Forte plc and Granada Group plc (now ITV plc) and
was a partner at Arthur Andersen.
He was previously a Non-Executive Director of easyJet plc
and Chair of their Finance Committee until August 2020.
Key strengths:
• Excellent track record of delivering long-term growth
strategies and shareholder value globally across diverse
territories.
• Strong leadership skills.
Experience:
From 2005 to 2015, André was Group CEO of Inchcape
plc, during which time he strengthened its position in the
global automotive market with a track record of delivering
double-digit earnings growth with strong cash generation,
and created significant shareholder value as its market
capitalisation more than doubled during his tenure as
Chief Executive.
He was previously Chairman and Chief Executive Officer of
Euro Disney S.C.A., President of Burger King International
operations and formerly the Senior Independent Director
of Reckitt Benckiser Group plc from October 2008 to
December 2018.
Key strengths:
• Track record as an experienced finance executive.
• Broad international experience in highly successful
companies.
Experience:
Until March 2021, Jonathan was the CFO Health at Reckitt
Benckiser Group plc where he also served as the Group
Controller, Regional Finance Director for North America and
Regional Finance Director for Southern Europe. Prior to his
time at Reckitt Benckiser, Jonathan spent several years in
senior finance roles with SAB Miller, including three years as
the Finance Director of Royal Grolsch and Finance Director
for the UK business. Jonathan’s early career in finance was
with PwC. Jonathan is a Fellow of the Chartered Institute of
Management Accounting.
Committees
Audit
Nomination
Remuneration
Committee Chair
A
N
R
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
Board of Directors Continued
41
4
Graham Allan
Senior Independent Non-Executive Director
5
Gurnek Bains
Non-Executive Director
6
Lynda Clarizio
Non-Executive Director
7
Tamara Ingram OBE
Non-Executive Director
Appointed to the Board in October 2017
Appointed to the Board in July 2017
Appointed to the Board in March 2021
Appointed to the Board in December 2020
Committee: N R
Nationality:
Ethnicity: White
Tenure: 5 years
Independent: Yes
Committee: N R
Nationality:
Ethnicity: Asian
Tenure: 5.5 years
Independent: Yes
Committee: A
Nationality:
Ethnicity: White
Tenure: 1.75 years
Independent: Yes
Committee: N R
Nationality:
Ethnicity: White
Tenure: 2 years
Independent: Yes
Current principal external appointments:
Senior Independent Non-Executive Director of
InterContinental Hotels Group plc, Non-Executive Director
of Associated British Foods plc and Americana Restaurants
International PLC and a Director of Ikano Retail Pte Ltd
(privately owned). Chairman of Bata International (privately
owned) and adviser to Nando's Ltd.
Key strengths:
• Extensive international consumer and retail experience.
• Wide-ranging knowledge of the Asian market.
• Strong management knowledge and extensive board-level
experience.
Experience:
Graham was Group Chief Executive of Dairy Farm
International Holdings Limited, an Asian retailer
headquartered in Hong Kong, from 2012 to 2017. In 1992,
he joined Yum! Restaurants International (formerly PepsiCo
Restaurants International) where he held several senior
positions before assuming the role of President and CEO in
2003, leading the development of global brands KFC, Pizza
Hut and Taco Bell in more than 120 international markets.
Prior to his tenure at Yum! Restaurants, he worked as a
consultant including at McKinsey & Co Inc.
He was previously a Non-Executive Director of Yonghui
Superstores Co. Ltd in China and a Commissioner of Hero
Group, an Indonesian retailer.
Current principal external appointments:
Managing Partner of Global Future Partnership LLP and
CEO of Nous Think Tank.
Current principal external appointments:
Non-Executive Director of CDW Corporation, Emerald
Holding, Inc and Taboola.com Ltd (US listed companies), and
Simpli.fi Holdings, Inc., and Cambri Oy (both privately owned).
Current principal external appointments:
Non-Executive Director of Marsh & McLennan Companies,
Inc., Marks and Spencer Group plc and Reckitt Benckiser
Group plc.
Key strengths:
• Wide-ranging experience working with senior leaders
internationally providing an important voice on people.
Key strengths:
• Strong track record of leadership in complex organisations.
• Significant experience in digital measurement and broader
Key strengths:
• A long-standing leadership career in advertising,
marketing and digital communication.
Experience:
Gurnek was the co-founder of YSC Ltd, a premier global
business psychology consultancy. He led the business
as Chief Executive Officer and Chairman for 25 years
to a position of global pre-eminence, and a client base
comprising over 40% of the FTSE 100. Gurnek has worked
extensively with multinational organisations in the areas
of culture change, vision and values, executive coaching
and assessment, board development and strategic
talent development.
He is Chair of Akram Khan Dance Company.
He has a doctorate in Psychology from Oxford University.
technology.
• A deep understanding of consumer brands and digital
• Extensive board-level experience.
strategy.
Experience:
Lynda is the Co-Founder and General Partner of The 98,
an early-stage venture fund investing in tech-enabled
businesses led by women. Lynda was President of U.S. Media
at Nielsen Holdings plc, a global measurement and data
analytics company, where she worked from 2013 to 2018.
Her prior experience includes CEO, President and other
leadership positions at AppNexus, Inc., INVISION, Inc., AOL
Inc. and Advertising.com. She previously was a partner in
the law firm Arnold & Porter, where she practised law from
1987 to 1999.
She is Vice Chair of Human Rights First, a non-profit
international human rights organisation.
Experience:
Tamara held leadership roles within WPP from 2002, and
was the Global Chair of Wunderman Thompson (a subsidiary
of WPP plc). Her executive experience includes senior roles
at Kantar Group, McCann Erickson and Saatchi & Saatchi UK,
where she held the roles of CEO and Executive Chair. Tamara
was previously a Non-Executive Director of Sage Group plc
and Serco Group plc.
She is Chair of Asthma + Lung UK.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
Board of Directors Continued
42
8
Jez Maiden
Non-Executive Director
9
Kawal Preet
Non-Executive Director
10
Gill Rider CB
Non-Executive Director
11
Jean-Michel Valette
Non-Executive Director
Appointed to the Board in May 2022
Appointed to the Board in December 2022
Appointed to the Board in July 2015
Appointed to the Board in July 2017
Committee: A
Nationality:
Ethnicity: White
Tenure: 0.5 years
Independent: Yes
Committee: N/A
Nationality:
Ethnicity: Asian
Tenure: –
Independent: Yes
Committee: A R
Nationality:
Ethnicity: White
Tenure: 7.5 years
Independent: Yes
Committee: A
Nationality:
Ethnicity: White
Tenure: 5.5 years
Independent: Yes
Current principal external appointments:
Group Finance Director for Croda International Plc and
Non-Executive Director of the Centre for Process Innovation
Ltd.
Current principal external appointments:
President, Asia Pacific, Middle East and Africa for FedEx and
US-ASEAN Business Council and Junior Achievement, Asia
Pacific.
Current principal external appointments:
Chair of Pennon Group plc. Chair of South West Water and
Bristol Water plc (both subsidiaries of Pennon Group plc) and
Pro-Chancellor of the University of Southampton.
Current principal external appointments:
Non-Executive Director of Sleep Number Corporation and
Lead Director (Senior Independent Director) of The Boston
Beer Company, both of which are US listed companies and
Fine & Rare Wines Ltd.
Key strengths:
• Wide-ranging and extensive financial background.
• Extensive experience in a diverse range of industries
Key strengths:
• Strong executive experience in fast-paced and complex
organisations.
and sectors across all geographies.
• Significant experience in transportation and airline
Experience:
Jez has been the Group Finance Director for Croda
International Plc, the FTSE100 global speciality chemicals
company, since 2015. Before he joined Croda International
Plc, he was the Group Finance Director at National Express
Group PLC from 2008. Jez was also previously the Group
Finance Director at Northern Foods Plc and Chief Financial
Officer at British Vita Plc. He was previously the Senior
Independent Director, Chair of the Audit Committee and a
member of the Nomination and Remuneration Committees
at Synthomer plc and Chair of the Audit & Risk Committee
and a member of the Nomination and Remuneration
Committees at PZ Cussons plc. Jez is a Fellow of the
Chartered Institute of Management Accountants.
industries.
• Strong regional experience in Asia Pacific, Middle East
and Africa.
Experience:
After a career of over 25 years at FedEx Express, Kawal is
President, Asia Pacific, Middle East and Africa, a position she
has held since 2020. In that role, Kawal has responsibility for
a region encompassing 103 countries and territories with
nearly 40,000 employees. After working for Tata Motors
as a Graduate Engineer Trainee in India, Kawal joined FedEx
Express in 1997 as an Associate Engineer in Singapore. She
is currently serving on the Boards of US-ASEAN Business
Council and Junior Achievement, Asia Pacific. Kawal was
previously a Non-Executive Director of Asia Airfreight
Terminal Co. Ltd, a private company from 2016 to 2020. Kawal
Preet has a degree in Electrical Engineering and an MBA.
Key strengths:
• Successful global experience on the people agenda.
• Extensive experience as a Non-Executive Director.
• Strong experience on remuneration and
sustainability issues.
Experience:
Gill was head of the Civil Service Capability Group in the
Cabinet Office, reporting to the Cabinet Secretary. Prior to
that, she held a number of senior positions with Accenture,
culminating in the post of Chief Leadership Officer for the
global firm. Previously Gill was a Non-Executive Director of
De La Rue plc and, until January 2020, Senior Independent
Director of Charles Taylor Plc, where she also chaired their
Remuneration Committee.
Key strengths:
• Extensive knowledge of the US market.
• Strong leadership and board-level experience,
with purpose-driven companies.
Experience:
Jean-Michel has more than 30 years’ experience in
management, US public company corporate governance,
strategic planning and finance. Previously, he was Chairman
of Peet’s Coffee and Tea, Inc., a US beverage company which
was listed at the time. He was also appointed as Managing
Director at the Robert Mondavi Winery before becoming
Chair. In his earlier career, Jean-Michel was President and
Chief Executive Officer of Franciscan Estates, Inc., a
premium wine company. He was Chair of Sleep Number
Corporation until May 2022.
She is currently President of the Marine Biology Association
and was also previously President of the Chartered Institute
of Personnel & Development.
He currently serves as an independent adviser in the US
to select branded consumer companies.
He has an MBA from Harvard Business School.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
43
Direct reports to the CEO (as at 27 February 2023)
Global functions
Tony George
Executive Vice President,
Human Resources
Ken Lee
Executive Vice President,
Marketing and Communications
Geographies
Jon Qin
CEO, Greater China
Sandeep Das
Regional Managing Director,
South Asia and MENAP
Product
Global business lines
Colm Deasy
President, Transportation
Technologies, Building &
Construction and People
Assurance
John Fowler
Senior Vice President,
Exploration and Production
Julia Thomas
Senior Vice President,
Corporate Development
Group
Mark Thomas
Group General Counsel and
Head of Risk & Compliance
Ayush Dhital
Regional Managing Director,
Asia Pacific
Ian Galloway
Executive Vice President,
Middle East and Africa
Ian Galloway
Executive Vice President,
Global Trade
Sandeep Das
President, Global Softlines
and Hardlines
Jonathan Timmis
Group Chief Financial Officer
Ross McCluskey
Executive Vice President,
Europe and Central Asia
Carlos Velasco
President, Latin America
Bertrand Mallet
Executive Vice President,
Industry Services
Calin Moldovean
President, Business
Assurance and Food
Services
Saranpal Rai
President, Electrical and
Connected World
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Board Leadership and Company Purpose
44
Effective and entrepreneurial board
Our Board comprises a Chairman, CEO, CFO and eight
independent Non-Executive Directors. We all have
differing skills, a wide range of diverse experience
and extensive knowledge built up over time in our
professional careers, which enables the Board to fully
understand the strategic business drivers of Intertek,
but also the risks and exposures associated with the
multiple sectors and regions in which the Company
operates. During the year, we welcomed two new
Directors on the Board which brings new skills, views
and perspectives as outlined in the Nomination
Committee report on pages 67 to 70.
The need for an effective and entrepreneurial
Board to provide the right leadership continues to
be important; our combined experience of dealing
with economic crises over the past 30 years has
helped to inform and qualify us to effectively manage
the ongoing impact of the pandemic as it went on
into the first half of 2022, the changing macro-
economic environment and the increasing awareness
of the risks associated with climate change, to
ensure the long-term sustainable success of the
Company is not hindered. As such, our collective
experiences have enabled us to preserve the
long-term value of the business for our shareholders,
our people and our customers, as well as the wider
community as a whole for years to come.
The governance of Intertek is the responsibility of
the Board, with the support of the Group Company
Secretary, and provides the framework of authority
and accountability that operates throughout the
Company to ensure the needs of all stakeholders
are considered and met. Good governance requires
the Board to lead, guide and support the business
in its quest for long-term sustainability and viability
through strategic planning, and part of the
governance structure in place is the development,
implementation and monitoring of the 5x5 strategic
plan for growth throughout the year. This is an
ongoing process which is reviewed annually by
the Board and involves a thorough review of the
progress being made on the implementation of
the strategy and the five-year business plan.
The strategic review involves a 360˚ review of
the Intertek value proposition, the 5x5 strategy,
updates on the competitive environment and
regulatory changes. The changes to the economic
environment, the long-term structural drivers and
emerging trends shaping the world are discussed,
as well as the resulting impact on Intertek, together
with the strategic initiatives for the year and
ensures alignment with our Purpose of bringing
quality, safety and sustainability to life for an
ever better world.
We are also responsible for ensuring that the
appropriate financial resources and people with the
right skills and behaviours are in place to achieve the
long-term strategy and deliver long-term sustainable
performance. Further information on our strategy
and progress towards delivering our strategic aims
is set out in the Strategic report in Book one and
further information on the activities of the Board
is outlined in the table on pages 48 to 49.
The Intertek
value proposition
Strategic
initiatives for
the year
The 5x5
strategy
Emerging trends
shaping the world
The strategic
review involves a
360° review of:
Updates on
the competitive
environment
Risk
environment
Long-term
structural drivers
Regulatory
changes and
changes to the
economic
environment
The Intertek value proposition and Purpose
For more than 130 years, Intertek’s story has always
been about innovation. In 1885 we began testing
and certifying grain cargoes before they were put
to sea, and in 1888 we pioneered the idea of
independent testing laboratories. Then in 1896,
the greatest inventor of them all became part of
our story. When Thomas Edison released the
wonders of electricity and the light bulb he wanted
to ensure that his products were checked, tested
and safe. He established the Lamp Testing Bureau,
later to become the Electrical Testing Laboratories.
Today, our superior customer service is based on our
Science-based Customer Excellence approach that
we have built up over many years, based on three
essential components, namely: our science-based
technical expertise, our science-based continuous
improvement and our science-based innovation.
The foundations and aspirations of our business
remain true to those established by our visionary
founders, and their innovation and energy continue
to be our inspiration. Our passion and entrepreneurial
culture will ensure that we deliver for our customers
in safety, quality and assurance – today and in
the future.
The Board, with the Leadership Team, sets the
corporate culture that defines our Purpose and
establishes an environment where values are
appreciated and respected, encouraging all of
our people to ‘Do Business the Right Way’. Our
culture and Values have been, and remain, the core
foundations of Intertek. Our 10X culture is one of
entrepreneurial spirit and high performance, where
we are totally focused on our customers, as outlined
on pages 17 to 23.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Board Leadership and Company Purpose Continued
Board oversight of culture
Our success is based on a culture of trust amongst
our colleagues, globally. To support and ensure this
trust, we continuously monitor and develop further
insights into the culture operating within the
business. In doing so, we review the following
throughout the year:
45
Area
Link to culture
View from the top
Town Halls allow the dissemination of information to employees across the Group and enable local leadership to communicate the
right behaviours and cultural expectations, as well as give peer nominated awards for demonstrating our 10X Energies. Town Halls
occur monthly at every Intertek location globally; they are monitored as it is a Core Mandatory Control. The 10X growth, coaching,
training, people planning and the focus on recognition at all levels ensures that the right values and culture are driven throughout
the organisation.
The Board also reviews voluntary permanent employee turnover and the Group Engagement Index and as outlined on page 11,
two of our Beyond Net Zero targets are a voluntary permanent employee turnover rate < 15% (2022: 14%, 2021: 13%) and having
a Group Engagement Index of 90 (2022: 80, 2021: 80).
Globally aligned reward
and incentive schemes
Our long-term incentive schemes are aligned so as to drive the right behaviours and values of our business, globally, in line with our
Purpose right down throughout Intertek. In 2022, following feedback from our shareholders and other stakeholders and in line with
the Group’s wider Purpose of bringing quality, safety and sustainability to life, we introduced an ESG element into the annual
incentive framework. More information is outlined in the Remuneration Committee report.
Health and wellbeing
Due to the importance we place on safety within Intertek, we have updates at every Board meeting on Health and Safety statistics
across the Group to monitor trends year-on-year and to ensure that the right practices are being followed.
As outlined on page 10, one of our Beyond Net Zero targets is having Total Recordable Incidents < 0.5 per 200,000 hours worked
(2022: 0.44, 2021: 0.51).
There were regular emails to the Board to closely monitor our people’s health and wellbeing as the pandemic continued into 2022.
Ethics and compliance
reports
Updates at every Board meeting on all hotline and whistleblowing reports and analysis by issue type. This enables the Board to
determine if there are any trends which need further analysis or investigation. For more information see pages 50 and 76.
Training
Everyone in the organisation is asked to complete annual training on the Intertek Code of Ethics to demonstrate our understanding
of, and commitment to, the highest standards of business conduct and ensure that we do business the right way. For more
information see page 34. As outlined on page 34, one of our Beyond Net Zero targets is having 100% compliance training
completion (2022: 97%, 2021: 94%).
There is also annual training on the Core Mandatory Controls with further information outlined on page 76.
Key claims reports
Updates at every Board meeting on material legal claims and a review of the significant legal claims by the Audit Committee
to monitor the trends and types of claims.
Internal audit reports
Updates at every Audit Committee meeting on internal audit reports, the areas of non-compliance with the Core Mandatory
Controls and actions taken to address the non-compliance together with trend analysis to underscore that we are ‘Doing Business
the Right Way’.
Acquisitions
When the Board is considering acquisitions, one of the factors we consider is the culture of the business being acquired and how it
will fit within the Intertek Group. The Board deemed the acquisition of Clean Energy Associates, LLC, a market-leading independent
provider of Quality Assurance, supply chain traceability and technical services to the fast-growing solar energy and energy storage
sectors, to have a similar culture of high performance and passion for customers.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 46
Employees' perspective on our culture
Visits to locations across the world, both virtual and in-person, provide an
opportunity for the Board to see the culture operating in situ. Below are
some of our colleagues’ views on culture in Latin America.
Intertek’s culture is living day by day with new possibilities to
improve processes focused on reducing errors and providing
customers with quality services, challenging ourselves to
grow professionally."
Claudia María Torres
Quality and Compliance Officer,
El Salvador
Intertek's culture focuses on human resources, promoting
teamwork, with ideas aimed at continuous improvement,
in which we all do our bit to achieve the objectives, to
exceed the expectations of our clients and to be their
main ally, which makes us continue to be leaders in the
market, feeling the pride of belonging to a great family
that is governed by very high quality standards and that
encourages you to be better day by day."
Veronica Luna
Sustainability Manager, Mexico
Intertek's culture is about passion
and purpose; passion in every project
and every goal with the clear purpose
of helping our clients to position
themselves as a benchmark of
total quality."
Ilse Peralta
Government Sales Manager, Mexico
The foundations and aspirations of our business remain
true to those set by our visionary founders, and innovation
continues to be our inspiration. Our passion will ensure
that we deliver for our customers safety, quality and
sustainability to everyone's lives.
After ten years at Intertek, I realise that not only does the
Company have its culture, but it also works and adapts to
the culture of customers in different countries."
Joel Silva
Inspector, Brazil
Six years ago, when I joined the Intertek Team, I started as
an Operations Assistant. I have always sought to be the
best of Intertek's 10X Energy, motivating and engaging
myself to always perform my best. I have always been in
search of knowledge and experience, by taking internal
training and undertaking extracurricular courses together
with higher education, to always keep me engaged and
have good relationships internally and with customers.
Today, I am now an Operational Coordinator due to the
10X Culture."
Intertek's culture is to do our day-to-day
work honestly, always doing the right
thing with passion and dedication and
treating each service as if it were ours;
providing our clients with quality
services."
Lucina German
Caleb Brett Administrative
Manager, Mexico
Alexsandro Ferreira
Operational Coordinator Caleb Brett, Brazil
Book oneBook threeBook twoIntertek Group plc Annual Report & Accounts 2022Financial ReportSustainability ReportStrategic ReportContents Board and Committee framework
47
Our Board of Directors
The Board has the ultimate and collective
responsibility to promote the long-term
sustainable success of the Company, ensuring
that value is created for shareholders and
contributes to wider society through its
effective, entrepreneurial and innovative
leadership. They ensure that the necessary
resources are in place for the Company to meet
its objectives and measure performance against
them. Our Board consistently acts with integrity,
leads by example and promotes the culture to
ensure its dissemination throughout the
Company. It sets the strategic aims of the
Company, its Purpose, customer promise, Vision
and Values in alignment with our culture as
outlined in Book one, pages 10 to 23.
The Board recognises the importance of its
obligations under section 172 of the Companies
Act 2006 to engage with, and consider, key and
relevant stakeholders as part of its decision-
making process. More information on the principal
decisions made by the Board are in Book one,
page 59.
The activities of the Board during 2022, and
how the Board’s governance contributes to the
delivery of Intertek’s strategy, is outlined on
pages 48 and 49.
The Board delegates certain matters to
its three principal Committees to carry
out business as defined in their respective
Terms of Reference. The remit, authority and
composition of each Committee are clearly laid
out and reviewed regularly to ensure that the
support provided to the Board is effective. The
Board also maintains the Board Approval Matrix
which outlines the matters reserved for the
Board. When necessary, the Board may delegate
very specific matters to ad hoc subcommittees
with clearly defined responsibilities and for a
limited period of time. The Terms of Reference
for each Committee and the Board Approval
Matrix are available at intertek.com.
Nomination Committee
Ensures the Board and its Committees have the correct balance
of skills, experience and knowledge and that adequate and
orderly succession plans are in place.
Audit Committee
Oversees the Group’s financial reporting, ensuring the
effectiveness and independence of the external and internal
audit functions and reviews the Group’s financial internal
controls and risk management systems.
Remuneration Committee
Establishes the Group’s Remuneration Policy and ensures that
it supports the strategy promoting the long-term sustainable
success of the Group and that there is a clear link between
performance, remuneration and alignment with our Purpose,
Values and strategy.
Leadership Team
The Board delegates specific responsibilities, subject
to certain financial limits, to management. This is
governed by the Core Mandatory Controls, an annually
reviewed and refreshed framework that allows the
delivery of the strategic aims and financial performance
whilst allowing risk to be assessed and managed.
Biographical details of the Leadership Team can
be found at intertek.com.
Supporting Committees
The Leadership Team operates a number of
supporting committees which provide oversight
on key business activities and risks as outlined on
page 37.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 48
Topics
Strategy
Link to strategic priorities
Link to stakeholders
Board and Committee framework Continued
The following pages give an insight
into how we, as a Board, use our
meetings as a mechanism for discharging
our responsibilities, including how the
consideration of stakeholders is
embedded into our workings as a Board
and the range of matters we considered
and discussed throughout the year.
Each Board meeting follows a carefully structured
agenda agreed in advance by the Chairman, CEO and
Group Company Secretary; this ensures that proper
oversight of key areas of responsibility are scheduled
regularly, and that adequate time is available for the
Board to fully consider strategic matters. Every
December, the Board reviews, discusses and agrees
the Group’s strategic plan and objectives. During the
year, the Board then monitors and reviews the
performance of the business to ensure that the
strategic objectives are being met. The topics in the
following table are presented to the Board for review
against the 5x5 strategy to ensure that the goals
underlying our strategy for growth have been met
during the year. The 5x5 strategy and goals are
outlined in Book one, page 10 and the outcome of
some of the decisions made by the Board during the
year in line with the 5x5 strategy are outlined in
Book one, page 59.
In addition to regular items, we receive presentations
from the Leadership Team and global leaders across
the business on their areas of responsibility and
expertise. External speakers also present periodically
to provide an overview on global or regional matters.
One meeting a year is conducted overseas and this
year it was held in India.
Principal risks
01 Reputation
02 Customer service
03 People retention
04 MacroEconomic
05 Health, safety and wellbeing
06 Industry and competitive landscape
07 IT systems and data security
08 Covid-19
09 Contracting
11 Business ethics
12 Financial risk
Strategic priorities
Differentiated brand proposition
Superior customer service
Effective sales strategy
Growth and margin-accretive portfolio
Operational excellence
Link to risks: 01 02 03 04 05 06 07 08 09 10 11 12
2022 Board Strategic Agenda
Group M&A Strategy
Consideration and approval
of acquisitions
Group Assurance Strategy
The Intertek World of Energy
Group Strategy and five-year plan
Topics for the 2022 strategy session
2023 Annual Budget
Financial management and performance
Link to risks: 01 02 03 04 06 07 08 09 10 11 12
CEO report
Finance report
Investor Relations report
Key to stakeholder groups
Financial forecasts
i.
ii.
iii.
iv.
v.
Customers
Communities
Investors
People
Other
Approval of full-year results, Annual
Report & Accounts, half-year results
and the AGM circular and proxy
Trading Updates shareholder feedback
Final and interim dividends
10 Regulatory and political landscape
Group Portfolio Update
Group IT Strategy
i. iii. iv.
All
All
All
All
All
All
All
All
All
All
All
iii.
iii.
iii.
iii.
All
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
Board and Committee framework Continued
Topics
Link to strategic priorities
Link to stakeholders
Topics
Link to strategic priorities
Link to stakeholders
49
Compliance and risk
Link to risks: 01 02 03 04 05 06 07 08 09 10 11 12
Quarterly Integrated Risk, Control,
Compliance and Quality report
2021 Modern Slavery Act Statement
TCFD risks opportunities and impact
Customers
Link to risks: 01 02 03 04 05 06 07 08 09 10 11 12
Group Innovation Strategy
Group Marketing Strategy
Other
Link to risks: 01 02 03 04 05 06 07 08 09 10 11 12
Overseas Board meeting in Delhi, India
External speakers
All
All
All
i. iv.
i. iii.
All
All
People and culture strategy
Link to risks: 01 02 03 11 12
Group Talent Planning
Group People Strategy
Executive Committee succession
planning
Sustainability
Link to risks: 01 02 03 04 05 06 08 10
Sustainability moments at every Board
and Committee meeting
Group Sustainability Strategy
Corporate governance
Link to risks: 01 02 03 04 05 06 07 08 09 10 11 12
Reports of the activities of the
Audit, Nomination and Remuneration
Committees
Notice of 2022 AGM and Proxy Form
AGM preparation (Chairman’s script,
Questions & Answers, proxy votes and
proxy advisors voting reports)
Chairman’s Corporate Governance
Shareholder Roadshow Feedback
Re-election of Directors at the
2022 AGM
Directors’ conflicts of interest
2022 Internal Board, Director and
Committee evaluation process
2021 External Board, Director and
Committee effectiveness review
Purchase of shares by ESOT
iv.
iv.
iv.
All
All
iii. iv. v.
iii
iii.
iii.
iii. iv.
All
All
All
iv.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
Board and Committee framework Continued
Compliance, whistleblowing and fraud
Intertek is committed to maintaining a culture where
issues of integrity and professional ethics can be
raised and discussed, which is aligned to our Values
to always do the right thing with precision, pace and
passion. This also forms part of our 5x5 strategy
for growth. The Group’s key ethics and integrity
policies are set out in the Code of Ethics and a
detailed description of the topics covered by the
Code of Ethics, its operation during the year and
the outcomes of these policies are contained on
page 34. All third parties working are required,
as a condition of engagement, to document their
acceptance and understanding of the Intertek
Code of Ethics and Intertek Anti-Bribery Policy before
commencing work on our behalf. It is the responsibility
of each third party acting on Intertek’s behalf to
understand and apply these two Intertek Policies.
Whistleblowing is the responsibility of the Board
and the Group has a whistleblowing process which
includes a global hotline system enabling all
employees, contractors, suppliers and others to
confidentially report suspected misconduct or
breaches of the Code of Ethics. Hotline posters are
required to be displayed in a clearly visible position
at each Intertek site and is a Core Mandatory Control.
This is supported by dedicated Compliance Officers
across the Group’s markets who undertake the
investigation of any issues arising from reports to
the hotline system or from other sources, such as
routine compliance questions. The Board receives
quarterly reporting on whistleblowing and integrity
issues. The Group Compliance function is
independent of the Group’s operational business
and reports directly to the Group General Counsel.
Hotline poster
in English
Hotline poster
in Indonesian
Hotline poster
in Turkish
Code of Ethics
booklet in French
INTERTEK
HOTLINE
NEED TO
SPEAK OUT?
Do you have a concern about:
• Data falsification?
• Fraud or theft?
• Conflicts of interest?
• Violation of company policies?
• Gifts, bribes, or kickbacks?
you to express concerns regarding any potentially
unethical or illegal situations. Independently owned
and operated by Convercent, your concerns will be kept
secure and treated confidentially.
Anyone who, in good faith, seeks advice, raises a
concern, or reports misconduct, is doing the right thing.
Whatever your concern may be, silence will only make a
bad situation worse.
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Visit: intertekhotline.com
24 hours / 7 days a week
INTERTEK
HOTLINE
PERLUKAH
BERBICARA?
Suara Anda dapat membawa perubahan
Apakah anda memiliki kekhawatiran mengenai:
• Pemalsuan data?
• Penipuan atau pencurian?
• Konflik kepentingan?
• Pelanggaran kebijakan
• Hadiah, suap, atau balas jasa?
• Keselamatan di tempat kerja?
• Pelecehan atau diskriminasi
di tempat kerja?
perusahaan?
• Konflik atau pelanggaran lain?
Hotline Intertek adalah cara yang sederhana dan efektif
untuk Anda menyampaikan kekhawatiran mengenai
kemungkinan situasi yang tidak etis atau melanggar
hukum. Kekhawatiran Anda akan aman, dirahasiakan,
dan keluhan dapat disampaikan secara anonim, karena
Intertek Hotline dimiliki dan dioperasikan secara mandiri
oleh Convercent.
Siapapun yang berniat baik untuk meminta saran,
menyampaikan kekhawatiran, atau melaporkan tindakan
yang tidak pada tempatnya, berarti telah melakukan hal
yang benar. Apapun kekhawatiran Anda, dengan bersikap
diam hanya akan memperburuk keadaan.
intertekhotline.com
24 jam / 7 hari seminggu
INTERTEK
HOTLINE
DİLE GETİRMEK
İSTEDİĞİNİZ BİR
ENDİŞENİZ Mİ VAR?
Dile getirdikleriniz fark yaratabilir
Aşağıdaki konularla ilgili bir kaygınız mı var:
• Verilerde tahrifat
• Dolandırıcılık veya hırsızlık
• Çıkar çatışmaları
• Şirket politikalarının ihlali
• Hediye, rüşvet veya komisyon
• İşyeri güvenliği
• İşyerinde taciz veya ayrımcılık
• Başka herhangi bir çatışma veya ihlal
Intertek Yardım Hattı etik dışı veya yasa dışı olabilecek her
durumla ilgili endişelerinizi ifade etmeniz için basit ve etkili
bir yoldur. Bağımsız olarak Convercent’in sahip olduğu
ve çalıştırdığı yardım hattında, endişeleriniz güvenli bir
şekilde korunacak ve gizli olarak işlemden geçirilecektir.
Şikayetlerinizi isimsiz olarak da bildirebilirsiniz.
İyi niyetle başvuruda bulunan, endişesini dile getiren veya
bir suistimali raporlayan herkes, doğru olanı yapmaktadır.
Endişelendiğiniz konu ne olursa olsun, sessiz kalmak
durumu sadece kötüleştirecektir.
intertekhotline.com
24 saat / 7 gün
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NOTRE CODE DE DÉONTOLOGIE
CE QU’INTERTEK ATTEND DE VOUS
Intertek Code of Ethics v1.3_011020
1
50
Internal control and risk management
Intertek has implemented an end-to-end
integrated approach to risk, control and
compliance which embeds risk
management throughout our business;
allows us to dynamically adapt our
controls, policies and assurance activities
as our risk environment changes; and
creates responsibility and oversight of
our risk identification and risk mitigation
actions to ensure they are effective,
relevant and robust.
Our integrated risk management framework
Risk management is embedded throughout our
organisation using a framework of divisional, regional
and functional risk committees. These committees
meet quarterly to identify, monitor and assess the
risks within their area of responsibility using tools
which include a dashboard of leading and lagging risk
indicators and risk mitigation action plans. It is the
responsibility of each committee to assess whether
its risk environment is changing, whether it has the
right mitigation action plans and whether new or
different plans are required in response to new or
changing risks.
The risk committees report to our Group Risk
Committee which in turn provides a report on risk
and mitigation actions at each meeting of the Board.
Our integrated approach to
identifying and mitigating risks
At Intertek, we view our risk environment as
consisting of emerging risks (risks that are potential
or future-looking) and systemic risks (risks which
are concrete and actually present or inherent in
our operations). Emerging risks are assessed by
perceived likelihood and impact and addressed using
mitigation action plans on a ‘three lines of defence’
model. Systemic risks are addressed using our
internal controls, policies and procedures.
Our risk identification and mitigation approach is
integrated and dynamic as our risk committees
continually review their emerging risks and, to the
extent those risks start to become systemic (or ‘real’
rather than ‘potential’ risks), identify new controls,
policies or procedures so that we can put new
systemic mitigations in place.
Our integrated approach to risk assurance
We have an integrated approach to getting
assurance that our risks are being appropriately
and effectively identified and addressed. We use an
integrated assurance map, which takes each of our
emerging and systemic risks and maps an assurance
framework onto them by identifying the roles or
functions which are responsible for the management,
control and oversight of those risks.
Evidence that this assurance is robust is primarily
validated by our Internal Audit function (which audits
our financial controls and risks), by our Compliance
function (which audits our non-financial, operational
controls and risks), and by our CyberSecurity team
(which audits our IT controls and risks).
Our integrated approach
to risk governance and oversight
The Board ultimately reviews the Group’s risks,
controls and compliance and mitigation actions.
The Audit Committee is responsible for reviewing the
adequacy and effectiveness of that risk framework.
If this governance and oversight identifies new risks
or the need for new controls, policies or procedures,
those changes are made and fed back to the
framework of risk committees so that governance
and oversight results in a dynamic change to our
risk identification and mitigation action plans.
At each Board meeting during 2022, the Group
General Counsel presented an integrated risk, control,
compliance and quality report including a review of:
• the Group’s emerging risks, the status of the
quarterly emerging risk mitigation action plans and
the new quarterly emerging risk mitigation plans;
• the specific systemic risks including quarterly
hotline and whistleblowing reports, key claims and
authorised unlimited liability contracts; and
• the Group’s systemic risk environment, the status
of the quarterly systemic risk mitigation action
plans and the new quarterly systemic risk
mitigation plans.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
51
At Intertek, our goal is to deliver sustainability
excellence across all operations. Our sustainability
agenda concentrates on our four focus areas: People
and Culture, Working with our Customers, protecting
the Environment and supporting the Communities in
which Intertek operates, all whilst applying
responsible business practices.
During the year, the Board received a detailed update
on the progress of the sustainability strategy, action
plans and their effectiveness.
Recognising the importance of bold ambitions,
Intertek set new emission reduction targets to
improve our environmental performance across our
operations. These targets replace those set in 2017
and are aligned to the guidance provided by the
Science Based Target initiative for near-term targets
as a step on our journey to net zero by 2050.
To read more about the progress against our
sustainability commitments and activities
throughout the year, see pages 24 to 29.
Governance and Sustainability
Sustainability is central to everything
we do at Intertek and, as a Purpose-led
Company, it is anchored in our Purpose,
Vision and Values. The Board, as part of
its overall stewardship of the Company,
oversees the Group’s sustainability and
corporate responsibility, together with any
material environmental and social issues.
The Board recognises the importance of
sustainability to all our stakeholders, together
with the increasing risks associated with climate
change and ensures that at every Board and
Committee meeting, the first item on every agenda
is a 'Sustainability Moment' to demonstrate its
importance to the future long-term sustainable
success of Intertek.
While the Board as a whole has responsibility for
overseeing Intertek's approach to sustainability,
the Net Zero Steering Committee and the Beyond
Net Zero Steering Committee oversee and monitor
our policies, practices and progress against our
sustainability commitments and targets. Further
information on the composition of these steering
committees, together with their remit, is outlined
on page 37.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Stakeholder relations
For more than 130 years, Intertek
has understood its role in society
as companies around the world have
depended on us to help ensure the
quality and safety of their products,
processes and systems. We are focused
on driving long-term sustainable
performance and recognise the
importance of considering Intertek’s
responsibilities to our customers,
shareholders, and wider stakeholders.
We, as a Board, are clear on our legal duty to act
in good faith, to promote the success of the Group
for the benefit of shareholders and have regard
to the interests of our stakeholders and other
factors. These include the likely consequence of
any decisions we make in the long term; the interests
of employees; the need to foster the relationships
we have with all of our stakeholders; the impact
of our operations on the community and the
environment; the desire to maintain the highest
standards of business conduct; and to act fairly
between shareholders.
52
The Directors’ duties under section 172 of the
Companies Act 2006 help to underpin the good
governance which is at the heart of what we do.
Details of how we met our obligations during 2022,
by taking account of shareholder and wider
stakeholder interests in our strategic planning
and decision-making processes, are outlined in the
section 172 statement in Book one, pages 58 to 64.
Today, the expectations of all stakeholders –
employees, customers, consumers, investors,
communities and wider society, governments
and regulators – continue to rise. This statement
summarises how we have had regard for the need
to foster the Company’s business relationships with
customers and others, and the effect of that regard,
including on the principal decisions taken by us
during 2022, more details of which are set out in
Book one, page 59, and the value we create for our
stakeholders is outlined in Book one, page 21 and 22.
In 2021, we launched our Build Back Ever Better
('BBEB') platform at bbeb.com and by making our
Company ever better, and by helping our clients
to make their businesses ever better, Intertek is
uniquely positioned to inspire our communities
and ultimately the world to Build Back Ever Better.
With BBEB we continue to inspire everyone within
Intertek and beyond – our clients, friends and
families, communities and governments – to make
a positive difference to society.
The next section summarises how we have engaged
with employees during 2022 and how we have had
regard to their interests and the result of that
engagement. Our approach to investing in our people
to attract, develop, retain and reward our employees
is outlined on pages 10 to 16.
We, as a Board, are clear
on our legal duty to act in
good faith, to promote the
success of the Group for the
benefit of shareholders and
have regard to the interests
of our stakeholders."
Andrew Martin
Chairman
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Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
53
18
countries visited by the
Directors during 2022
Workforce engagement
In line with the Code, this section
outlines our engagement with our
employees.
After extensive discussions when the Code was
introduced, we decided not to choose one of the
methods suggested in provision 5 of the Code
due to the global nature and size of the business,
together with the complexity and diverse make-up
of the various sectors and regions in which we
operate. Instead, we utilise a multi-faceted approach
to workforce engagement to make certain that what
is in place ensures that we, as a Board, receive 360˚
multi-source feedback to assist us in evaluating the
different views and perspectives from our employees
across the Group. We keep our engagement
mechanisms under review and continue to believe
that this methodology remains effective as it enables
us, the Board, to fully understand the views of the
workforce when taking such considerations into
account as part of our decision-making process.
This is vital as our people are core to our business
and make it happen 24/7.
The way in which our people combine passion and
innovation with customer commitment to create a
single unbeatable asset sets us apart and is a vital
element of our entrepreneurial, customer-centric
culture. The variable remuneration structure and
policy for the Executive Directors cascades down
to the wider workforce and is communicated
throughout the Group, ensuring engagement across
Intertek to ensure alignment with our Purpose, to
drive the right behaviours and to deliver the 5x5
strategy. We are focused on ensuring that our
strategy and culture give our people the right
platform to not only grow and develop their careers,
but to support our Purpose in making the world a
better place by bringing quality, safety and
sustainability to life for an ever better world.
We utilised technology to ensure that throughout
the uncertain landscape that the pandemic
presented, we remained ever connected with our
people, globally. During the pandemic, Microsoft
Teams was instrumental in providing instant
communication between all business lines and
functions, and we have continued to utilise
technology as we returned to in person meetings as
it has enabled the Board to virtually meet and visit far
more employees and sites than previously possible.
The way our colleagues have come together to
embody our Purpose to bring quality, safety and
sustainability to life for an ever better world has
been an inspiration to all during the pandemic.
Their commitment to our customers to go above
and beyond and deliver superior customer service
has truly demonstrated the strong customer-centric
ethos at the core of Intertek. Our success is based
on the energy and enthusiasm with which our people
react to our meaningful Purpose.
How did we engage?
The world needs Intertek more than ever, with the
unrivalled expertise of our people, our focus on
delivering risk-based Total Quality Assurance
solutions, and our proven track record of innovating
and anticipating the growing needs of our clients as
the world around them grows more complex.
On the next few pages, we outline how the Board
ensures that it has the right touchpoints across the
world for employees, regardless of their country or
site, to engage. This ensures that their views are
understood to provide the necessary feedback and
data that the Board can then incorporate as part
of its strategic decision-making process during the
year to determine the impact of such decisions on
our employees.
Our Vision
Our vision is to be the world’s
most trusted partner for
Quality Assurance, underpinned
by our shared values:
• We are a global family
that values diversity.
• We always do the right
thing, with precision,
pace and passion.
• We trust each other and
have fun winning together.
• We own and shape
our future.
• We create sustainable
growth. For all.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Workforce engagement Continued
our engagement
with our people
2022
54
As a member of the Valuable 500,
Intertek is committed to actioning
disability inclusion. We want all our
colleagues to feel that they are part
of a diverse community, where
everyone is included and has access
to the tools and resources they need
to succeed in their careers.
Thomas Childs, IT Data Assistant at Intertek Cristal,
joined Intertek in September 2021 through the UK
Government’s ‘Kickstart’ scheme and became a
permanent member of the Intertek CSF team in June
2022. He was interviewed by Sally Murtagh, Director
Group Internal Communication, and gave his advice
on how to understand and support people with
Cerebral Palsy. Sally also separately interviewed Tim
Dixon, Head of IT Architecture, and Hannah Gibson,
Director of Assurance and Training in the UK, both
of whom have hereditary eye conditions. The
interviews were made available on Intertek’s
intranet to promote awareness and understanding.
I have an amazing line manager who has really
encouraged me to be more brave and open about
my disability and to understand that my disability
doesn't define me or make me any less able to do
my job. I'm very competitive, like a lot of people are
in work, and I like to put in my best performance
and operate at my fullest potential, which she's
enabled me to do. The management team that I'm
on are a fantastic bunch, and we're all really open
about my disability. We've incorporated that into
the way we work, so they really let me be myself
without letting my disability define me, but also
taking it into account."
Hannah Gibson
Director of Assurance
My colleagues have been awesome in supporting
me with my work and helping me progress to
where I am today. I’m lucky that I’ve landed in a job
that I really like. I’m grateful to work with a team
who are so nice and who have accepted me for who
I am. They've made me feel included from day one.”
Over the last seven years, since initial diagnosis,
I've been fortunate to have had several managers
who have fully supported me and, with the support
of UK HR and a UK government scheme called
Access to Work, we've been able to work through
technology that will help me remain in work,
remain productive and perform at 10X levels.“
Thomas Childs
IT Data Assistant
Tim Dixon
Head of IT Architecture
Book oneBook threeBook twoIntertek Group plc Annual Report & Accounts 2022Financial ReportSustainability ReportStrategic ReportContents 55
>
Regular updates on the status of the pandemic
across the world and the impact on our colleagues.
>
The Non-Executive Directors undertook additional
visits to our laboratories engaging with our
employees across the world as below:
• Austin (US)
• Florence (Italy)
• Dubai (UAE)
• Manchester (UK)
• Melbourn (UK)
• Mississauga (Canada)
• Jurong Island (Singapore)
• Milton Keynes (UK)
• San Antonio (US)
>
In 2022, Jez Maiden was appointed to the Board. As
part of his induction programme, he met with senior
colleagues at Intertek and as part of his induction
into the business visited seven countries, both
virtually and in person, with presentations and
tours by 20 senior managers where he was
introduced to many other colleagues during the
tours. The engagement with the local workforce
aided his induction and allowed him to ask questions
and understand any issues to then be encapsulated
and addressed in future Board discussions.
Workforce engagement Continued
Town Halls were conducted across the world. As
an example, in August 2022, as part of their visit
to Singapore on 15 August, Intertek CEO, André
Lacroix and Regional Managing Director, Asia
Pacific, Ayush Dhital, held a Town Hall meeting
with all employees of Intertek Singapore and
Intertek Malaysia.
André thanked everyone for their contribution
to Singapore and Malaysia’s excellent financial
performance during the first half of 2022. He
applauded colleagues’ commitment to Intertek
and recognised their outstanding performance
in achieving sustainable growth and bringing value
to all stakeholders.
The Town Hall concluded with a 10X Energies
Awards ceremony, with the following
performers being recognised in appreciation
of their great efforts:
• Georgina Mendoza Legaspi
(Caleb Brett – Quality Assurance)
• Samsudin Bin Mohd Yusoff
(Caleb Brett – Cargo Inspection Training)
• Dinesh S/O Shanmuganathan
(Caleb Brett – Cargo Inspection)
• Mohammad Nasir Bin Mohamed
(Caleb Brett – Cargo Inspection)
• Jammy Tay Siok Hoon (Agri)
• Raja Hamidah Bte Ab Kadir
(Industry Services)
• Kimmy Chan Yi Cheng
(Government & Trade Services)
• Business Assurance – System
Certification Team (Represented by
Leonnoel Goh and Desmond Lim)
• Electrical Team (Represented by Ong Keng
Chuan, James Tan, Yison Ong & Yap FangYu)
• Hafiza Wati Binti Jusoh (Agri – Indo Business)
• Elangovan A/L Krishnan (Agri)
>
Question and answer sessions are held at Town Halls
to provide two-way communication and a method of
further engagement. André Lacroix led 32 Town
Halls across the world during 2022.
>
Our colleagues across the world continue to upload
stories about how they or their team are bringing
our Purpose to life through their work. The stories
are available to view on WhatsIn, our internal
communications system.
>
The October overseas Board trip to India took place
in Delhi and enabled the Board to meet colleagues
from India, Bangladesh, the Middle East and
sub-Saharan Africa and visit the following Intertek
laboratories:
• Delhi (India)
• Dhaka (Bangladesh)
• Tirupur (India)
>
Meetings with colleagues within the business during
2022. The Chairman and Non-Executive Directors
have met 35 leaders and subject matter experts
across the Group and had presentations on their
areas of expertise at Board meetings throughout
the year. They have also met many other colleagues
visiting sites during the year and on the visit to India
in October 2022. Technology has been used to
facilitate the attendance of many from overseas
without the need for travel to the physical Board
meeting. The increased flexibility in how we facilitate
the interaction between the Board members and our
employees has evolved from changes necessitated
during the pandemic. The Board was particularly
interested to engage with and hear feedback from
our employees across the different locations.
We had an excellent visit to
Milton Keynes. All the teams
we met were incredible experts
in their fields, professional and
passionate about the difference
we can make to our clients'
development and testing plans.
It was exciting to see the
investment in EV technology.”
Gill Rider
Non-Executive Director
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 56
Workforce engagement Continued
Visit to India and stakeholder
engagement — October 2022
For the first time in two years, the overseas Board
visit was held in person and was truly an exciting
event enabling engagement with colleagues and
seeing our Science-based Customer Excellence
approach in action. Our external speakers provided
in-depth analysis of the current geopolitical and
economic climate in the region."
Communities:
• All presentations had a sustainability
moment from the installation of solar
panels to improving health and safety
statistics.
• Examples of Corporate Social Responsibility
initiatives were provided.
Monday
Tuesday
Board members arrived in
Delhi, India
Morning
Morning
Afternoon
Andrew Martin
Chairman
Customers:
External Speaker
Intertek Site visit – Gurugram SL – Hardlines
& Softlines Laboratory
Sandeep Das, President Global Softlines and
Hardlines and Regional Managing Director South
Asia and MENAP Product, gave an introduction to
the laboratory and then gave a tour of the facility.
Meeting with two customers; one of which was
Richa Global, one of the oldest garment producers
in North India and a customer of Intertek for two
decades.
• Details of major customers and projects.
• How Intertek is viewed as a partner and the
value of the services provided.
• The focus of customers on sustainability.
People:
• Headcount and turnover.
• Importance of attracting the best talent.
• Focus on diversity.
Evening
External Speaker
Wednesday
Presentations
India Country Presentation
India Softlines
Sandeep Das
Ashish Gupta
Sandeep Das
India Business Assurance
Sandeep Vig
India Electrical
Nagendra Bangaragiri
India Caleb Brett
Priyabrata Mohanty
India Food
Prakash Vishnu
India Industry Services
Kamal Deep Dalela
Bangladesh: Country
presentation
Sandeep Das
Neyamul Hasan
South Asia: People
Smriti Chand
World of Energy – MENAP
Hanna Jabbour & James Ignatovich
MENAP Products
Sandeep Das
Sub-Saharan Africa
Reinhold Gehling
MENAP – People
Sanjay Joshi
Evening
Dinner
External Speaker
Board and local management
Thursday
Board meeting
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 57
Workforce engagement Continued
The Board agreed that the commitment
and pride of the team working in India,
the Middle East and Sub-Saharan
Africa shone through and they really
appreciated the time taken by our
colleagues to demonstrate with passion
the services provided. The management
team had also provided very clear and
detailed analysis of their businesses
and future strategy.
What did we learn were the issues for
employees during 2022?
The engagement with our colleagues highlighted
the main areas of concern in 2022 and these are
encapsulated below.
What are the opportunities for
training, growth and promotion
within Intertek and how is my
work recognised at Intertek?”
How do I know what is
happening in our business?"
How can we contribute
to our communities?"
What help is available
to support employees?"
What did we do?
Employee growth and recognition
Our passionate Intertek Total Quality Experts work
globally for our customers daily, contributing to the
success of our customers' products, services and
operations and helping us succeed in our Vision of
being 'The world’s most trusted partner for Quality
Assurance'. Our People Strategy is captured in the
sentence:
Energising our colleagues
to take the Company to
new heights."
Our differentiated TQA value proposition creates
incredible growth opportunities for our people. In
order to seize these growth opportunities, we want
to inspire, engage, grow, develop and retain the best
people and ensure they always have the right skills
to deliver our TQA Customer Promise and grow our
business.
The '10X WAY!' is a suite of interactive training
programmes developed in 2017 by our own
leadership team, using key tools and best practice.
E-learning modules are available to employees via
LUCIE. Our performance and growth conversation
process, My 10X Journey, enables quality
conversations to clarify expectations, foster
continual personal growth and development, and
inspire people to perform beyond their best. Here
follows information on the 10X Leadership and
10X Coaching undertaken during 2022.
10X Leadership
What is 10X Leadership?
10X Leadership is designed as a fully immersive
leadership development experience for senior
leaders comprising lectures and leadership
exchanges on key principles of leadership.
Attendance at 10XL events is voluntary and
senior leaders are invited to self-nominate, so the
impetus to attend is entirely self-motivated. This
approach engenders a committed and impactful
learning experience for leaders, rather than it being
imposed. Events are kept to approximately 100
delegates to allow for intimate group interactions.
10XL events held to date are below:
10XL Events
When
10XL 1.0 2019 – Athens Nov 2019
10XL 2.0 2022 – Oxford March 2022
10XL 3.0 2022 – Orlando Sept 2022
Excellent planning and execution at
all levels. Lectures delivered by André
were riveting, leadership exchanges
were valuable, activities were exciting
and fun. Overall, one of the best
events I have ever attended.”
10XL selected verbatim feedback:
• “Everything AAA++++”
• “First, to be able to hear direct from our CEO for
a whole week on his life experiences – absolutely
incredible, what an honour. Also, I truly loved the
format of lecture for an hour+ and then a totally
engaging workshop session. The structure of
the workshops was fantastic. Getting to know
other colleagues from other business lines was
terrific. So well done.”
• “I will remember the 10X Leadership event in
Florida as one of the best weeks of my life.”
• “Enlightening, inspirational, energising and giving
me the resources and courage to be an ever
better leader!”
• “The lectures delivered by André, along with his
personal experiences, felt like I was participating
in an MBA course; the fact that a CEO took his
time to do this is amazing. It was a very inspiring
week.”
• “I was honestly overwhelmed by the level of
energy and inspiration that I left the event with.
I'm hopeful that I can execute on this now that
I'm back to Earth. And, I look forward to the next
stage of coaching to follow.”
We are actively planning future events in 2023 for
current and future nominees.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Workforce engagement Continued
10X Coaching
What is 10X Coaching?
We certify our own in-house 10X Coaches through
our 10X Coaching programme. To qualify as a 10X
Coach, selected leaders attend a rigorous in-house
training programme where they develop the skills
to have truly transformative conversations which
create a culture and environment where people
can unleash their full potential. 10X Coaches
are required to meet annual re-certification
requirements to continue their coaching practice.
In 2022, we recertified eight coaches from our
10XCCP1.0 programme and certified a further
ten new coaches in programmes 10XCCP2.0 and
10XCCP3.0. Our next certification programme
10XCCP4.0 is underway.
Our 10X Coaching faculty now has 18 certified
10X Coaches.
A key learning from our 10X Coaching certification
programme is that those who are certified as a 10X
Coach experience a paradigm shift in how they
consider leadership. There is a clear multiplier
effect whereby there is an impact on the coach,
their team and participating coachees.
10
new 10X Coaches certified in 2022
18
total 10X Coaches certified
10X Coaching selected verbatim feedback
We have received great feedback from
participants:
• “For this is an amazing experience. I am learning
much more than teaching... this is really an
opportunity for my personal/professional
development!!! Thank you for this.”
• “I am truly excited and grateful for this
important training milestone. I think it is a
privilege to have someone of such depth
available to address topics in such a personal
form. Especially thank you also for the choice of
coach, it seems amazing how comfortable I feel
with her, I could not have had a better person.”
• “Each session we’ve had now has left me
bursting with new ideas and insights. …allows
me to navigate through my own thinking, where
I am also confronted with some of my own
quirks…I am truly loving the experience. I think
I have been assigned a great coach that will truly
help me become a better leader.”
• “It gives me new insights and also confirmation
that I am making the right choices.”
• “…very open, very clear on the rules of
engagement, gives me confidence and creates
a safe environment for me to open up and
question some of my thinking. I am finding the
experience extremely rewarding and energising…
It is a true 100% coaching session – all down to
me to find my own answers. All in all, a very
positive experience.”
We continue to build our 10X Coaching faculty and
offer the experience of coaching to our leaders.
58
10X Recognition
10X Recognition
To recognise our colleagues, there is a monthly
global awards programme called 'Beyond the Peak'
which is about celebrating our top performers
across our Business Lines, Regions, Countries and
Country/Business Lines for their outstanding
achievements across various categories. Each
month, we recognise Intertek's fearless
'Summiteers' on our intranet.
On 2 March 2022, a virtual awards 5x5 awards
ceremony took place whereby André Lacroix
recognised the top performers for 2021 in the
following categories:
• The Performance Award
• The Operational Excellence Award
• The Sales Award
• The Brand Award
• The TQA Award
• The Innovation Award
• The Sustainability Award
• The Back to Peak Award
During the year, regular events have taken place
at special events and Town Halls to recognise
employees. As an example, Intertek UK celebrated
its 2021 recognition awards. The event kicked
off by celebrating their group 5x5 Award for
Sustainability which was a huge achievement
and recognised the work the UK had done to
reduce emissions. This was followed by the
winners of Intertek UK's Energy League – the
three performance league tables for the UK
country managed business lines and then by the
Sales League Awards. There was also a National
Ignite Award, where finalists have gone above
and beyond in their roles, demonstrating our 10X
Energies and supporting colleagues, customers,
and the UK business in 2021.
Dominic Holloway, Food Services was recognised
as the 2021 National Ignite winner for his Winning
energy, delivering incredible results for Food
Services, the UK business, and for one of our
customers. Dom has been truly reliable, always
willing to help others, coordinating complex
programmes across multiple business lines and has
done so with a smile on his face! He has been a
standout example for supporting colleagues and
delivering exceptional customer service. A Kindness
Award was also given to recognise and celebrate our
UK colleagues supporting each other and sharing
moments of kindness. The 2021 National Kindness
Award was given to Olivia Thompson, Chemicals &
Pharma Wilton. From an incredibly strong shortlist,
Olivia was voted by the UK senior leadership team as
the winner thanks to the positive energy, care and
consideration for colleagues demonstrated in her
nomination. It was clear Olivia has gone out of her
way to make Wilton a great place to work, and we
were delighted to hear her story.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 59
In MENAWA, the HR team placed a drop box at
reception for colleagues to donate non-perishable
food and other items in good condition to the Red
Crescent charity.
Intertek Pakistan organised with Indus Hospital a
voluntary blood donation drive at Intertek’s Baig
Tower office to support the hospital’s blood bank and
blood Cancer Patients.
In China, our colleagues took part in various Kindness
initiatives and in the USA, we had a Kindness
challenge for each day of the week, culminating in a
challenge to think about what your site or team can
do this year to give back to your community during
Intertek’s 'A Season of Giving' challenge.
1,000+
laboratories and offices
in more than 100 countries
43,500+
employees
Our combined 20+ team enjoyed
a great day outdoors with marine
conservation, education and team
building the key themes."
Frank Beiboer
Managing Director of Intertek Energy & Water
Workforce engagement Continued
Our Communities
Intertek has a network of more than 1,000
laboratories and offices in more than 100 countries
employing more than 43,500 employees, and we
have an important part to play in the communities
where we are based, not only in terms of providing
employment and opportunities but also in providing
support for our local communities.
We are a Purpose-led Company bringing quality,
safety and sustainability to life, and it is our
colleagues who give us the right to call Intertek an
"amazing force for good” and make a difference in
their communities. Here are some examples of what
we do for the communities where we live and operate.
Each spring and fall, Friends of the Grand Rapids
Parks rally the community to plant trees. The goal
is to plant 10,000 new trees throughout the city
as part of an overall goal to have a 40% tree canopy.
The benefits of trees include improved mental
and physical health of residents and neighbours,
decreased utility costs, lower rates of crime and
speeding, improved environmental resilience and
stormwater management, and a significant decrease
in heat islands.
This year, 150 volunteers came together for two
days and planted 200 trees in a neighbourhood
within the City of Grand Rapids, Michigan. Six of our
HR Team in Grand Rapids participated in planting the
trees, which, in addition to being a lot of fun, has also
made an impact on Grand Rapids' shade equity, tree
diversity, and so much more.
In September 2022, members of Intertek’s UK-based
Energy & Water team and WSP UK Ltd participated
in a beach clean event at Yaverland Beach on the
Isle of Wight. The event complemented Blue Sea
Protection’s 'Great Nurdle Hunt', a foreshore survey
that is conducted to determine the prevalence of
micro-plastics (specifically nurdles) on the beach.
Along a 100m stretch of the beach, the team
surveyed the various types of rubbish that were
found and collected. The resulting information from
the 17.8kg collection was uploaded to the Marine
Conservation Society’s database for their Great
British Beach Clean annual event.
The day’s social and networking events also proved
to be quite educational as participants learned how
and where to recognise nurdles – plastic pellets
which serve as raw material in the manufacturing
of plastic products and bio-beads which are used in
the wastewater treatment industry. They also learnt
about Mermaids Purses (aka Shark Egg Cases) and
the impacts of nurdles/bio-beads on shark and ray
populations around the Isle of Wight.
Frank Beiboer, Managing Director of Intertek Energy
& Water, said: “Our combined 20+ team enjoyed a
great day outdoors with marine conservation,
education and team building the key themes."
In October 2022, Intertek Malaysia held a fund-
raising charity bazaar to support the Rumah Victory
home for the elderly and raise funds to expand the
home as the rooms are currently fully occupied. The
fundraising was successful with over 100 booths
selling a variety of food and other items with the
Intertek Malaysian team happy to be able to play
a part in giving back to society.
In India, they celebrated Kindness Week culminating it
through #kindnessincommunity. Employees in the
offices of Delhi, Bangalore and Mumbai spent time
with children from underprivileged backgrounds whilst
sharing a meal. Elsewhere in Intertek, our colleagues
participated in various #kindnessincommunity
initiatives throughout the week.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 60
World Kindness Day is celebrated in November
and has now evolved into a week-long recognition.
Kindness can mean different things to different
people. The essence of Kindness is in how we choose
to show it. Be it through empathy, acceptance, kind
gestures, thoughtfulness, the possibilities are
entirely up to us. To celebrate this empathy and
thoughtfulness, the South Asia team celebrated
Kindness Week through a series of initiatives across
all locations and offices from 9 to 14 November.
The week started with a fitness challenge on
9 November to do the highest number of push ups
and surya namaskar, the longest plank and a plethora
of other friendly tests of physical fitness!
This was followed the next day with a session on
'Gratitude'. Through the day, team members shared
appreciation cards for 'Moments of Kindness' that
they had experienced with colleagues. This was
followed by a webinar, and then by a Kindness
themed BINGO where everyone practised a
moment of kindness and empathy and struck off
all that they had done on the Kindness BINGO card.
Through our Kindness programme, we will continue
to support our colleagues’ wellbeing and ensure a
safe and healthy work environment in which they
can prosper.
To support our colleagues' health
and wellbeing, we have arranged
this small appreciation token,
the Kindness Gift box for you to
celebrate this festive season with
caution, care and responsibility.”
Yip Yew Joe
Country Managing Director, Intertek Thailand
It's exciting to achieve and exceed
a challenging goal with fellow
campaigners. With the daily goal
and the total distance always in
mind, the challenge motivated
everyone to (even) more physical
activity in everyday life.”
Holger Breins
General Manager DACH, Hardlines & Softlines
Workforce engagement Continued
Employee support
At Intertek, we are mindful of the wellbeing of
our colleagues, which is why we encourage them
to take a moment to visit our Global Wellbeing
programme, Kindness.
Our Intertek Global Wellbeing programme, Kindness,
was introduced to support the wellbeing of all
employees. Kindness is a personal experience that
helps all employees make sure that they do the
simple things that help build their own personal
strength and resilience – to help re-energise, boost
wellbeing and unleash our potential. Six spaces were
developed and each of these six spaces of wellbeing
are available to all employees as e-learning modules.
The ten-minute modules introduce the theory and
science behind each area of wellbeing, providing tips
and suggestions on how to benefit and improve in
that area, exercises and tools to apply, and
information on where to find out more.
At Intertek, we are also committed to the safety
and wellbeing of our employees and we have an
Environment, Safety and Wellbeing ('ES&W')
Representative for each of our locations globally
and an ES&W 'Champion' for each of our Global
Business Lines.
In Intertek Thailand, as colleagues returned to work
in the New Year, they were given a small token of
appreciation in the form of a ‘Kindness Box’. At the
beginning of 2022, the pandemic situation in
Thailand was still uncertain. The number of new
confirmed cases had reached over 8,000 and in
total there were more than two million cases. The
box contained Kindness hand sanitizer gel, spray
and Intertek masks.
Yip Yew Joe, Country Managing Director, Intertek
Thailand, said: “To support our colleagues' health and
wellbeing, we have arranged this small appreciation
token, the Kindness Gift box for you to celebrate this
festive season with caution, care and responsibility”.
As part of the health promotion program at our
Fürth site in Germany, our Hardlines & Softlines
colleagues in Germany were invited to take part in
a step challenge from July 6 to 19. More than 30
colleagues amassed a total of almost five million
steps by walking, cycling (converted into steps) and
taking part in other sporting activities, totalling
3,485km. For this, the colleagues contributed an
average of 10,943 steps per day.
The goal of the competition was to cover enough
steps and thus kilometres each day, individually
and as a group, to figuratively visit the sites of a
total of three Intertek partner laboratories in stages.
The destinations were not chosen at random but
represented the top three intercompany customers
of Hardlines & Softlines Germany: additionally, with
an extra 855km collected, the team even covered
enough steps for the one-way distance to Hardlines
& Softlines in Heudebouville, France.
Holger Breins, General Manager DACH, Hardlines &
Softlines, was delighted with the great performance
of the participating colleagues who joined him in
the campaign. “It's exciting to achieve and exceed
a challenging goal with fellow campaigners. With
the daily goal and the total distance always in mind,
the challenge motivated everyone to (even) more
physical activity in everyday life. Combined with
lectures and preventive check-ups, our annual
program always focuses on wellbeing, this time the
importance and positive effect of physical exercise.”
In October, a live webinar took place for all our UK
colleagues: A conversation for everyone: Menopause.
This webinar was for all, because at some point we
will all directly or indirectly live with, work with, or
socialise with someone going through menopause.
Lauren Chiren, founder and CEO of Women of a
Certain Stage, is passionate about normalising
menopause at work. This webinar was an
opportunity to learn from Lauren, and to ask
questions about how we can recognise menopause
as a workplace topic, support our colleagues and
demystify this important subject.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 61
During 2022, family days have taken place at our
laboratories, so that their families also know more
about Intertek and what we do as they form part
of the larger Intertek family. Below is an example
of a family day which took place this year.
In September 2022, a #BBEB Family Day was
organised at Intertek LaCoMeD, our analysis
laboratory located in Chalon-sur-Saône in France. The
site welcomed 12 children of our employees, all aged
between four and 11 years old, who began the day
learning about their parents’ working environment
through a guided tour of the offices. Following the
tour, it was time for our apprentice chemists to
experiment... an opportunity to let them discover the
magic of chemistry! The children took part in different
experiments, such as: from the mixture of two
'transparent' solutions we obtain a 'pink' solution,
from the mixture of a 'yellow' solution and a
'transparent' solution we obtain a 'blue' or 'pink'
solution and 'Air in all its states' – to offer an
awareness of the different states of matter (liquid—
gas—solid). After the experiments, it was time for our
budding chemists to rest and enjoy a well-deserved
snack. The kids were presented with colouring books
and #BBEB goodies as a souvenir of this fun day!
Workforce engagement Continued
Ongoing communication
This year has been a year full of ups and downs,
with the ongoing Covid-19 pandemic impacting the
business in Shanghai, China for the first half of the
year and other challenges as we navigated through
the rest of 2022. In spite of these circumstances,
our colleagues continue to be nothing less than
extraordinary. An important part of engagement is to
ensure that there is ongoing communication with our
colleagues throughout the business about Intertek.
WhatsIn, our global communication platform,
features a mobile app and desktop intranet to help
connect with 43,500+ colleagues around the world
and keeps everyone updated with the latest news
across the world. The WhatsIn mobile app – made by
Intertek for Intertek people – puts Intertek news,
contacts and ATIC services at our fingertips –
especially useful for our colleagues ‘on the go’, on
client sites or in remote locations. Everyone can
comment on articles and even share their own news,
either in a group chat or voice message or via the
‘share your story’ link.
André Lacroix, our CEO, also presented global
webcasts on the full-year results, the publication
of the 2021 Annual Report & Accounts and the
half-year results together with updates on the May
and November Trading Updates. There was also a
global webcast Town Hall update from André Lacroix
in October 2022. André sent a message to everyone
in December wishing everyone a Happy Christmas
and thanking them for their hard work in 2022.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Investor and shareholder engagement
62
January
• Bank of America, C-Suite SMID
Cap Conference 2022
• ODDO BHF Forum
• Redburn US Roadshow (virtual)
The Board is committed to
maintaining an active and open
dialogue with investors and sees
this as an important part of the
governance process. At each
meeting, the Board receives a report
from the investor relations
department and analysts’ reports
are circulated to the Directors when
available. Feedback from meetings
held between executive
management, or the investor
relations department, and
institutional shareholders, is also
communicated to the Board.
December
• Berenberg European Corporate Conference London
• Credit Suisse US – Canada Roadshow
• Numis Paneuropean Conference (New York)
March
• Full-year results 2021
• Annual Results Roadshow
• Berenberg UK Corporate Conference 2022
• Morgan Stanley – The Future of Food Conference (virtual)
• Stifel Switzerland virtual Roadshow
Investor relations programme
Aimed at helping existing and potential investors
understand the Group’s business model, strategy,
financial performance and outlook. The programme
is wide-ranging and includes events and roadshows
throughout the year to update investors and sell-side
analysts on the developments of the Group.
Conferences
Executive Directors and the Investor Relations team attend
industry conferences throughout the year, providing the
opportunity to meet a large number of investors.
May
• Trading Statement
• AGM
•
Jefferies Structural Winners Virtual Conference
June
• Bank of America Luxembourg Roadshow
• Barclays Testing, Inspection & Certification (‘TIC’)
Conference 2022
• Berenberg US Roadshow (virtual)
• Berenberg Non-Holder Roadshow (virtual)
• Kepler Cheuvreux ESG Conference (virtual)
• Kepler Cheuvreux One Stop Shop Dublin 2022
• Stifel Italy and Switzerland Roadshow
July and August
• Half-year results 2022
• Half-year Results Roadshow
• Citi Frankfurt Roadshow
• Danske Bank Nordic Roadshow
September
• Berenberg Testing, Inspection & Certification
Conference 2022
• Bernstein Strategic Decisions Conference 2022
• Citi’s Growth Conference 2022
• UBS Business, Leisure and Transport Conference 2022
November
• Trading Statement
• Credit Suisse US West Coast Roadshow
Board shareholder engagement
The Chair, following any engagement with shareholders,
ensures that the Board as a whole has a clear under-
standing of their views. Intertek’s largest shareholders,
representing more than 50% of the share register, are
invited annually to meet with the Chairman to share their
views and discuss any corporate governance matters.
During April and May 2022, the Chair held four meetings
with shareholders and there was an increased focus in
the meetings on the business post the pandemic and
the opportunities for Intertek in sustainability with fewer
questions relating to corporate governance than last year.
The feedback received was positive, and the shareholders
continue to be very supportive of Intertek’s strategy, the
management and the Board. The feedback was presented
and discussed with the Board at the May Board meeting.
In 2022, there was also further engagement with
shareholders on the introduction of an ESG target for
the 2022 annual incentive following feedback from
shareholders during the shareholder consultation in 2021.
Intertek’s largest shareholders, representing more than 70%
of the share register, were contacted and any questions
answered. Three meetings were held with the Chair of the
Remuneration Committee, EVP, Human Resources and the
Group Company Secretary. The feedback was presented
and discussed at the May Remuneration Committee meeting
and then at the Board meeting. See Book one, page 62 for
further information on the engagement with shareholders.
Resources
A wealth of information is available to investors in our Annual
Report & Accounts, half-year announcements and trading
updates and Regulatory News Service announcements.
These materials are available on our website and are
supplemented by videos, webcasts and presentations.
Roadshows
Following the full-year and half-year results announcements,
the Executive Directors and Investor Relations team held
meetings with the principal shareholders.
Feedback Forum
The Executive Directors and Investor Relations team
receive regular feedback from sell-side analysts and
investors during the year both directly and through the
Group’s corporate advisers. The Group Company Secretary
also receives feedback on governance matters directly from
investors and shareholder bodies.
Annual General Meeting (‘AGM’)
The Board welcomes the opportunity to meet with
both private and institutional investors at the AGM.
The 2023 AGM is currently scheduled to be held on
Wednesday, 24 May 2023 at 9.00 a.m. in the Marlborough
Theatre, No. 11 Cavendish Square, London, W1G 0AN. The
AGM provides the opportunity for all shareholders to ask
questions of the full Board on the matters put to the
meeting, including the Annual Report & Accounts.
All Board members attend the AGM and, in particular,
the Chairs of the Audit, Nomination and Remuneration
Committees are available to answer questions. The Board
welcomes the opportunity to meet with both private and
institutional investors at the AGM. The Company proposes
a resolution on each separate issue and does not combine
resolutions inappropriately. The Notice of the AGM is sent
to shareholders by e-communications or by post and is also
available at intertek.com.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents
63
Division of responsibilities
There is a clear division of responsibilities between the running of the Board (a key responsibility of the Chairman) and the day-to-day running of the Company’s business (the responsibility of the CEO). These responsibilities
have been formalised in writing. The letters of appointment of the Non-Executive Directors, as well as the service agreements for the Executive Directors, are available for inspection at the Company’s registered office and
at the Annual General Meeting (‘AGM’).
Roles and responsibilities
Chairman — Andrew Martin
Chief Executive Officer — André Lacroix
Chief Financial Officer — Jonathan Timmis
Key responsibilities
• Leading and governing the Board to ensure its
overall effectiveness in directing the Company.
• Assessing and monitoring the culture within the Company and
ensuring that it aligns with the Company’s Purpose and Values.
• Ensuring that Directors receive accurate, timely and clear
information to enable them to discharge their duties to
promote the long-term sustainable success of the Company.
• Ensuring effective two-way communication between
the Board, shareholders and key stakeholders.
• Communicating to all Directors the views, issues
and concerns of major shareholders.
• Promoting a culture of openness and debate and facilitating
constructive Board relations and the effective contribution
of the Non-Executive Directors.
• Demonstrate objective judgement.
Key responsibilities
• Proposing and agreeing the Group Strategy with the Board.
Key responsibilities
• Managing the financial delivery and performance of the Group.
• Leading the day-to-day operations of the Group in line with
• Analysing the Company’s financial strengths and weaknesses
the agreed strategy and commercial objectives.
and proposing corrective actions.
• Promoting and conducting the affairs of the Company with
the highest standards of ethics, integrity, sustainability and
corporate governance.
• Managing the Leadership Team.
• Managing the finance, accounting and IT departments.
• Ensuring that the Company’s financial reports are accurate
and completed in a timely manner.
• Overseeing the capital structure of the Company, and determining
the best mix of debt, equity and internal financing.
Senior Independent Non-Executive Director — Graham Allan
Independent Non-Executive Directors
Group Company Secretary — Fiona Evans
Key responsibilities
• Providing a sounding board for the Chairman.
• Being available as an intermediary between the other
Directors and shareholders if necessary.
• Leading the annual performance review of the Chairman.
• Being available to meet with shareholders and other stakeholders
should they have any concerns that have not been resolved
through the normal channels.
Key responsibilities
• To constructively debate and add value with respect to
the proposals on strategy and risk management and offer
specialist advice.
• Scrutinise and hold to account the performance of
management and individual Executive Directors against
agreed performance objectives.
• Reviewing the appointment and removal of Executive Directors.
• Allocating sufficient time to the Company to discharge
their responsibilities.
Key responsibilities
• Supporting the Chairman in delivering Board and
governance procedures.
• Advising the Board on all governance matters.
• Ensuring good information flows within the Board
and its Committees.
• Facilitating induction and assisting with professional
development as required.
• Developing and overseeing the systems that ensure that
the Company complies with all applicable codes, in addition
to its legal and statutory requirements.
• Facilitating access to independent professional advice
at the Group’s expense.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 64
Division of responsibilities Continued
Independence
On appointment as Chairman of the Company,
the Board assessed and agreed that Andrew Martin
was independent in accordance with Provisions 9 and
10 of the Code. The Board continues to review the
independence of the Non-Executive Directors, other
than the Chairman, and considers that all of them
continue to demonstrate independence in both
character and judgement, are free from any
conflicting interests and have independent oversight
of governance and compliance. The Chairman is
committed to ensuring the Board comprises a
majority of independent Non-Executive Directors,
who objectively challenge management and monitor
performance for the benefit of all stakeholders. The
Board determined that Jez Maiden and Kawal Preet
were independent in accordance with the Code upon
their appointment to the Board during 2022.
In accordance with provision 11 of the Code, at
least half of the Board, excluding the Chair, are
Non-Executive Directors whom the Board considers
to be independent.
The Board recognises the recommended term
within the Code for Non-Executive Directors and the
Chairman to ensure the progressive refreshing of
the Board meets the evolving needs of the Company.
More information on the succession plans of the
Board, to ensure the appropriate combination of
executive and independent Non-Executive Directors
on the Board, is outlined in the Nomination
Committee report on page 67.
Time commitment of Directors
The Board recognises the importance of all
Non-Executive Directors having the necessary
time to commit to the business of Intertek and,
upon appointment, their letters of appointment
stipulate the expected time commitment whilst
acknowledging that this may vary depending upon
the demands of the business and other events.
All Directors make themselves freely available as
required, even at short notice, in order to meet
the needs of the business.
Procedures have been put in place and the Directors
seek approval from the Board before accepting any
additional external appointments. When assessing
additional directorships, the Board considers the
number and nature of external directorships already
held by the individual and the expected time
commitment for those roles. During 2022, approval
was given to Tamara Ingram for a new external
appointment.
Prior to joining the Board, Jez Maiden and Kawal Preet
disclosed their current commitments and the time
commitment involved. The Board was satisfied that
Jez and Kawal could provide sufficient time to
discharge their duties as Directors of Intertek (see
their biographies on page 42). As demonstrated in
the Board meeting attendance table, all Directors
who were eligible to attend scheduled meetings
attended every such meeting. Jez Maiden also spent
additional time during 2022 for his induction into the
business and more information on this is on page 65
in the Induction, training and development section.
As Kawal only joined at the end of 2022, her
induction will take place in early 2023.
In addition to the scheduled Board meetings, there
was frequent ad hoc contact between Directors to
discuss the Group’s affairs and the development of
its business. When required, the Board also met at
short notice on a quorate basis. During 2022, there
were no additional Board meetings held whereas in
2021 there were two additional Board meetings held
to discuss acquisitions and all Directors were present
at these meetings.
Two meetings with the Chairman and the Non-
Executive Directors, without the Executive Directors
or management being present, are scheduled every
year. The Chairman also maintains regular contact
with the Senior Independent Non-Executive Director.
Where Directors have concerns about the operation
of the Board or the management of the Company
that cannot be resolved, the minutes will reflect this.
No such concerns were raised during the year.
Directors’ conflicts of interest
The Board operates a policy to identify, authorise
and manage any conflicts of interest to assist
Directors in complying with their duty to avoid actual
or potential conflicts. The Directors are advised of
the process upon appointment and receive an annual
refresher. Whenever any Director considers that he
or she is, or may be, interested in any contract or
arrangement to which the Company is, or may be,
a party, the Director gives due notice to the Board
in accordance with the Companies Act 2006 and
the Articles.
The Conflicts of Interest Register is maintained
by the Group Company Secretary and the Board
undertakes an annual review of each Director’s
interests, if any, including outside the Company.
Any conflicts of interests are reviewed when a
new Director is appointed, or if and when a new
potential conflict arises. A formal process is also
in place for managing such conflicts to ensure
no conflicted Director is involved in any decision
related to their conflict and, during the year, this
process operated effectively.
100% attendance from all Board members
Board members and attendance
Board meeting attendance during the year to 31 December 2022
Board members
Andrew Martin Chairman
André Lacroix Chief Executive Officer
Jonathan Timmis Chief Financial Officer
Graham Allan Senior Independent Non-Executive Director
Gurnek Bains Non-Executive Director
Lynda Clarizio Non-Executive Director
Tamara Ingram Non-Executive Director
Jez Maiden (appointed 26 May 2022)
Kawal Preet (appointed 31 December 2022)
Gill Rider Non-Executive Director
Jean-Michel Valette Non-Executive Director
Scheduled meetings
eligible to attend
Meetings
attended
5
5
5
5
5
5
5
3
0
5
5
5
5
5
5
5
5
5
3
0
5
5
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Composition, Succession and Evaluation
65
Board appointments
The Board is committed to ensuring that it has the
right balance of skills, experience, knowledge and
diversity, taking into account the targets of the FTSE
Women Leaders and Parker Review, to lead Intertek
in these complex and fast-moving times and deliver
our strategy and TQA customer promise to be a force
for good and make the world a better and safer place.
More information on the appointment process to
ensure that we have the right individuals who can
inspire and provide passionate leadership to deliver
our 5x5 strategy is outlined in the Nomination
Committee report on pages 67 to 70.
Board skills, experience and knowledge
Induction, training and development
There is a full, formal and extensive induction
programme which is tailored to ensure that Directors
joining the Board are provided with the knowledge
and materials to add value from an early stage. This
is managed by the Chairman and the Group Company
Secretary. During the year, Jez Maiden received a
wealth of background information on the Company
and details of Board procedures, Directors’
responsibilities, various governance-related issues
and strategic priorities within the Group. The
induction also includes a series of meetings with
other members of the Board, senior members of
management and external advisers and visits to our
laboratories and sites. Due to the success of visiting
sites virtually during the ongoing pandemic, a
comprehensive programme of virtual visits to our
operations was put in place but now also includes
visits in person to laboratories. This enables our new
Directors to meet senior management across the
Group and our colleagues working in the labs in China,
Italy, Dubai, Germany, Singapore, Turkey, the US and
the UK, and is more time and cost effective. The
feedback from Jez Maiden was that this was one of
the most professional and comprehensive induction
programmes that he had received which gave a great
insight into the business, operations and people. This
process will continue to be kept under review in light
of Directors’ feedback.
Ongoing and continual development is crucial to our
Directors remaining highly engaged, effective and
well informed. All Directors are kept up-to-date with
information about Intertek’s business and there is an
ongoing programme of information dissemination
throughout the year. It is important that the
Directors have an appreciation of the business, both
in the UK and overseas. During the year, there were
presentations from the Leadership Team to the
Board and meetings have been held on regional
strategy to increase the understanding of
operations, opportunities and risks.
The Company also encourages Directors to attend
briefings and seminars offered by professional and
commercial bodies in order to keep abreast of current
legal and regulatory requirements, especially within
their specialist fields such as audit or remuneration.
Board, Committee and
Directors’ evaluation
The effectiveness of the Board, and its Committees,
is rigorously reviewed annually and an independent
externally facilitated Board review is conducted
every three years. The internal questionnaires are
reviewed and updated annually to ensure that the
right questions are asked and take into account
changes in guidance and regulations.
As planned, and recommended by the Code, the
2021 external evaluation process was led by
the Chairman, supported by the Group Company
Secretary and facilitated by an independent third
party, Equity Culture. Equity Culture has no other
connection to the Company and was appointed
after a review of independent advisers in the field
of formal Board evaluations.
2022
Internal
evaluation
>
>
2024
External
evaluation
>
2023
Internal
evaluation
The externally facilitated Board evaluation process,
which considered the Board composition, diversity
and how effectively members worked together to
achieve objectives, entailed:
• the review and agreement of a questionnaire to
be used at meetings with each Board member;
• one-to-one meetings with each Board member
and the external evaluator;
• preparation of a report by the external evaluator;
• discussions on the Board evaluation outcomes and
recommendations with the Chairman and CEO;
• discussion of the results of the evaluation with
the Board as a whole; and
• the Board identifying and agreeing areas for
improvement — the strategy and strategic agenda
having already been agreed at the Board meeting
in December 2021.
The key findings of the 2021 external evaluation
report were very positive as outlined below.
During recent years, a strong culture of high
performance and high integrity with a clear sense of
purpose has developed on the Board and throughout
the Company. Great care has been taken, when adding
new Board members, to ensure the right fit, culturally,
and in terms of beliefs and outlook to build on the
existing excellent chemistry and mutual respect on
the Board. Lynda Clarizio and Tamara Ingram, both
of whom were on-boarded during 2021, were very
positive about the comprehensive induction process,
noting the one-to-one meetings held with the CEO, the
Board members and the Leadership Team, followed by
an around the world tour of Intertek which included
two-hour presentations from all the main global
leaders, virtual site tours and questions enabling the
new Board members to experience the dynamics of
the business.
The Board is very experienced, and this collective
experience was an important factor in ensuring that
the Board continued to be as effective throughout
the pandemic as it had been before. This enabled the
Board to continue to effectively discharge all of its
responsibilities despite only having online meetings
between March 2020 and up to December 2021.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 66
Composition, Succession and Evaluation Continued
The technology employed to hold online meetings is
felt to have worked well and, in particular, the online
live tours of overseas sites enabled even more sites
to be visited than normal. These tours were felt to be
so valuable that, although they are not a substitute
for in-person visits, they will continue to be used
more extensively in future, enabling more sites to
be visited.
The mechanics surrounding the Board and
Committee meetings works extremely well with
well-structured agendas. The clarity of the papers
presented enables a complex business to be more
easily understood and the papers are of a very high
and professional quality. Due to online meetings
taking place during the pandemic, there has been a
little more emphasis on presentations. As more face
to face meetings now take place, there will be a
return to a more discursive emphasis.
The Board recognised the importance of the work
to create the Board Promise to embody the role and
purpose of all Board members in promoting Intertek’s
Purpose of bringing quality, safety and sustainability
to life and which informs the Board’s approach to its
duties to all stakeholders. Around the Board table
there is great pride in what Intertek does across the
world for various stakeholders and in the work that
our incredible colleagues perform daily to make the
world a safer place with precision, pace and passion.
The ‘People Agenda’, including talent development,
retention, succession and employee engagement
features high on the agenda, even more so given the
importance of the highly qualified employee base to
the ongoing success of Intertek. Succession and
talent planning is a very thorough and thoughtful
process with twice-yearly discussions at the Board.
André continues to bring a real sense of clarity
and alignment to Intertek’s strategy, and during
the year the Board’s input and involvement is
sought on the areas to be incorporated into the
annual strategic review, with the most recent
detailed discussion by the Board held last December.
Against the backdrop of extensive opportunity for
the industry, the discussions included a longer-term
horizon, looking forward.
Sustainability is very clearly part of Intertek’s
DNA and the Board has great confidence in the
Company’s environmental and social credentials with
a sustainability moment now part of every meeting
agenda. The Board will continue to consider whether
a Board ESG Committee is required, but at present it
is considered that the ESG agenda is so important,
that it should be the responsibility of all of the Board.
Governance overall is seen to be sound.
There is a real sense of community of purpose on the
Board with great support and respect for the work
André and the management team do in addressing
challenges as they arise, most recently with the
pandemic, and ensuring that the health and safety
of our employees are always the number one priority.
The 2022 Board internal evaluation process was led
by Andrew Martin, with the support of the Group
Company Secretary, and entailed:
• the completion of detailed questionnaires by each
Board member;
• discussions on the outcomes and recommendations
with the Chairman and each Board member; and
• following discussion of the results of the
For each Committee of the Board a similar process
was undertaken. The Committee evaluations looked
at ways in which they could improve their overall
effectiveness, their performance and areas of
improvement during the year. The outcome from
these evaluations confirmed that the Committees
were performing well and were appropriately
constituted.
Following the 2022 Board evaluation, the findings
from the internal review continued to be positive with
strong scores in each of the four categories that were
evaluated. All Directors agreed that the Board is open
and collegiate and has a positive dynamic and feel.
The materials presented to the Board are of a very
high quality and highly informative. Given the quality
of papers is so good, there is a desire to continue to
allocate as much time as possible for discussion as
part of the meeting agenda.
It was understood that the opportunity to get a
good sense of the 'touch and feel' of the operations
and culture had been a little more difficult during the
pandemic, given the inability to go and visit any of
the operations around the world. Everyone fed back
that the visit to India had worked extremely well, and
it had been very positive to once again meet
colleagues in person. With respect to talent mapping
and succession, the Board had very much appreciated
the increase in the number of senior management
presenting to the Board during the year and noted
that it would be helpful for the Board to continue to
have regular updates from the Regional Executive
Vice Presidents and Global Business Line leaders
during the year.
evaluation the Board as a whole, identifying and
agreeing areas for improvement.
An internally facilitated evaluation will also be held
for 2023.
Chairman and Director evaluation
The Non-Executive Directors, led by the Senior
Independent Non-Executive Director, conducted
a performance review of Andrew Martin, who was
the Chairman during 2022. They considered his
leadership, performance and overall contribution
to be of a high standard during the year.
Andrew Martin, the Chairman, met with each
Director to discuss their individual contributions
and performance, together with any training and
development needs. Following these reviews, the
Board remains satisfied that, in line with the Code,
all Directors are able to allocate sufficient time to
the Company to enable them to discharge their
responsibilities as Directors effectively and that any
current external appointments do not detract from
the extent or quality of time which any Director is
able to devote to the Company.
The Board recommends that shareholders should be
supportive of their election or re-election to the
Board at the 2023 AGM.
Group Company Secretary support
The role and responsibilities of the Group Company
Secretary are outlined on page 63.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 67
Nomination Committee report
The need to keep the Board refreshed but at the same
time maintain a knowledgeable and experienced team of
Non-Executive Directors is crucial and forms a large part
of the Committee's work."
Dear shareholder,
On behalf of the Nomination Committee (‘Committee’),
I am pleased, as Chair, to present the Committee’s
report for the year ended 31 December 2022 which
outlines the work of the Committee during the year.
During the year, the Committee continued to focus
its discussions on reviewing the current experience
and skills on the Board and the likely future needs in
order to build up a total skills overview and identify
any gaps; the outcome from the Board evaluation is
also used to inform these discussions. It is vital that
we have the right skills and expertise around the
Board table to help support the business to seize
the sustained long-term growth opportunities in
our industry as stakeholders’ expectations in a
post Covid-19 world in terms of quality, safety and
sustainability are higher, making the case for our
Risk Based Quality Assurance solutions stronger.
A priority is Executive and Non-Executive Director
succession planning. The need to keep the Board
refreshed but at the same time maintain a
knowledgeable and experienced team of Non-
Executive Directors is crucial and forms a large part
of the Committee’s work. The Committee continues to
demonstrate its ability to successfully identify the key
characteristics required on the Board and in May 2022,
Jez Maiden was appointed to the Board as a Non-
Executive Director. Jez is an experienced international
public company CFO with a strong track record, who
has worked in a diverse range of industries and
sectors, primarily manufacturing, service and finance
across all geographies. He is also an experienced
Non-Executive Director. His significant experience
across different industries will provide a strong
addition to the current skills on the Intertek Board.
In April 2022, the Financial Conduct Authority issued
the 'Diversity and inclusion on company boards and
executive management' Policy Statement which the
Committee reviewed and discussed in May 2022. We
also looked at the guidance and voting policies of
other stakeholders on diversity as well as reviewing
the Board composition of similar sized companies.
Following this review and considering the views of
stakeholders, we agreed further steps to address
our diversity agenda and as such Kawal Preet was
appointed to the Board as a Non-Executive Director
on 31 December 2022. Kawal is a highly experienced
executive who is currently President Asia Pacific,
Middle East and Africa for FedEx Express and brings
extensive knowledge of the Asia region to the Board
as well as additional skill sets in other fast moving
industries.
These exciting steps form part of the Intertek Board
evolution and will ensure that Intertek is best placed to
take advantage of the great opportunities which come
with having in place a diverse range of individuals with
the right skills around the Board table representing the
diverse nature of the Intertek Group itself.
Graham Allan, as the Senior Independent Non-
Executive Director, recommended my reappointment
as Chair and a Director of the Board. I am delighted to
report that I was reappointed for a third term of
three years with effect from 26 May 2022. We also
welcomed Tamara Ingram as a member of the
Committee with effect from 1 June 2022 to add
further insights and expertise on the Committee.
During the last few years, the Board and Senior
Management team have demonstrated their
versatility, adaptability and ability to react quickly
to evolving challenges, whilst simultaneously
navigating the Group through these uncertain times
with the strategy remaining core to the decision-
making. Our colleagues at Board and management
level have illustrated the defining characteristics we
strive for in our Intertek leaders when carrying out
succession planning, which in turn exemplifies the
successful mechanics of the Committee.
Andrew Martin
Chair of the Nomination Committee
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 68
The full Terms of Reference of the Committee, which
are reviewed annually, can be found on our website.
Committee responsibilities and how
we met them in the year
Performance evaluation
As part of the annual Board evaluation, the
Committee’s performance was evaluated by all
Committee members and it was shown that the
Committee continues to be able and effective in
discharging its duties in accordance with its Terms
of Reference and the requirements of the Code.
Board and Committee composition
During the year, we continued to monitor
the composition of the Board and its principal
Committees and the independence of our Non-
Executive Directors. We undertook our annual
review of the Board’s effectiveness and composition.
To ensure that the Board comprises a wide range of
skills, experience and attributes, the Committee
discusses and reviews extensively the experience, skills
and behaviours required of future Directors, including
the qualities of the individual required to ensure the
right fit with the culture and style of Intertek.
The review concluded that the current composition
of the Board and each Committee contained a
good balance of skills, multi-industry sector and
geographic experience, as well as diversity. The
Committee also unanimously agreed, following
the consideration of the independence of each
Non-Executive Director, that each Non-Executive
Director continued to be independent in accordance
with the criteria set out in the Code. The Chair was
independent upon appointment.
Nomination Committee report Continued
Membership of the Committee
During the year, we held four formal meetings.
Attendance of members at formal meetings is shown
in the table below. The Group Company Secretary
attends all formal meetings of the Committee and
the Committee invites the CEO and the EVP, Human
Resources to attend meetings when the subject
matter deems their presence appropriate.
Committee meeting attendance during the
year to 31 December 2022
Committee members
Andrew Martin (Chair)
Graham Allan
Gurnek Bains
Tamara Ingram
(appointed 1 June 2022)
Scheduled
meetings
eligible to
attend
Meetings
attended
4
4
4
2
4
4
4
2
100% attendance
Role and key responsibilities of the
Committee
• Review the structure, size and composition of
the Board and its Committees.
• Identify, review and nominate a diverse pipeline
of candidates to fill Board vacancies1.
• Evaluate the balance of skills, independence,
knowledge, experience and diversity on the
Board and its Committees.
• Review the results of the performance evaluation
process that relates to the composition of the
Board and its Committees.
• Review the time commitment required from
Non-Executive Directors.
• Review succession plans regularly.
1. Neither the Chair nor the CEO participates in the recruitment
of their own successor.
Board reappointments
Having come to the end of his second three-year
term as Non-Executive Director on our Board on
26 May 2022, Andrew Martin’s appointment was
reviewed. Following this review, the Board was
happy to reappoint Andrew for a final three-year
term, until 26 May 2025.
Where the reappointment of a member of the
Committee is being discussed, they are precluded from
any involvement in the discussions. In the instance
where the reappointment of the Chairman is being
discussed, the Senior Independent Non-Executive
Director would chair the Committee meeting.
Biographies for all the Directors are available on
pages 40 to 42, and a resolution for each Director
will be proposed at the forthcoming AGM for their
election or re-election.
Board evaluation
The process and findings of the external evaluation
of the Board and the evaluations of each Committee
and Director are outlined on pages 65 to 66. An
evaluation can determine whether there are any
gaps in the skills and composition of the Board.
Following the last evaluation, it was concluded
that the Board, each Committee and each Director
continue to perform effectively and contribute to
the long-term sustainable success of Intertek.
The outcomes and the actions taken from the
evaluations undertaken in 2021 and 2022 are
outlined on pages 65 to 66 and the feedback
from the Board evaluation is considered when
determining the key skills required for new
Directors on the Board for the future.
Talent mapping, succession planning and
senior management succession
We continue to focus our discussions on the
different time horizons within our succession
planning, including contingency planning for sudden
and unforeseen departures, the orderly replacement
of current Board members and senior management,
and a longer-term view looking at the relationship
between the delivery of the Group strategy and
objectives and the skills needed on the Board now
and in the future.
In 2021 and in 2022, as part of our succession
planning, the Committee initiated searches for new
Non-Executive Directors. In addition to the specific
skills, knowledge and experience deemed necessary,
the role specification contained criteria such as
competency and personal qualities that would be
required for the position. The Committee also paid
close attention to ensure that the candidates
selected exhibited the right behaviours to fit the
culture, Values and ethics of the Group and would
also be able to allocate sufficient time to the
Company to discharge their responsibilities.
The Committee engaged Spencer Stuart, an external
search agency with no other connection to the
Company or its individual Directors, to assist with the
selection process. For both searches, an initial list of
potential candidates was produced and shortlisted.
The Committee members and the Chairman met
separately with the shortlisted candidates, following
which they agreed to recommend to the Board the
appointment of Jez Maiden, who was appointed to
the Board on 26 May 2022, and then subsequently
the appointment of Kawal Preet, who was appointed
to the Board on 31 December 2022.
As a consequence of the Board changes previously
discussed, there were a number of changes to the
composition of the Committees of the Board. With
effect from 26 May 2022, Jez Maiden was appointed
as a member of the Audit Committee and Tamara
Ingram was appointed as a member of the
Nomination Committee on 1 June 2022.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 69
Chairman and Non-Executive Director appointment process
Skills and composition review
The Committee reviews the structure and composition of the Board, in turn considering the
balance of skills, experience, industry and geographic experience and knowledge, diversity,
independence, and cognitive and personal strengths of the current Board. When considering these
factors, the Committee is mindful of attributes that will assist in the delivery of the Group strategy.
>
Creating the brief
The Committee, following the skills and composition review, compiles a brief for the role which
outlines favourable characteristics and attributes that they desire the appointed individual to hold.
This brief is then shared with the chosen consultant who will utilise the brief to compile a list of
suitable candidates.
>
Longlist and shortlist review
The appointed consultant presents an initial longlist of candidates. This list is then shortlisted using
the brief as a guide to determine suitability.
>
Due diligence
Once the candidates are shortlisted, initial interviews are held and the shortlist reduced further.
The final candidates are invited to separate meetings with the Committee members and the CEO.
>
Recommendation
Once a preferred candidate is chosen, the Committee makes a recommendation to the Board to
appoint the individual.
Nomination Committee report Continued
Diversity Policy
The Board and the Committee are committed to
achieving a Board which embraces diversity in
culture, gender, skills, background, regional and
industry experience and other qualities to truly
reflect the diverse nature of our business which
operates in more than 100 countries. All of
these factors are considered in determining the
composition of the Board to ensure that we have
the best people to lead Intertek.
In identifying suitable candidates to recommend for
appointment to the Board, the Committee considers
all candidates on merit, against objective criteria, and
with due regard for the benefits of diversity on the
Board to achieve the most effective Board possible.
Due to the strategic importance of talent mapping
and succession planning to the long-term sustainable
success of the Group, the Board, as a whole,
discusses and supports succession planning in the
Leadership Team and, as part of that discussion,
reviews the diversity, as well as talent mapping
across the Group in respect to Regional, Country
and functional roles.
This has enabled the Board to gather insights on
the key success factors desired for senior roles
within the Group and support in developing a diverse
pipeline in order to drive the Group’s 5x5 strategy.
The Leadership Team can be found on page 43.
Our policy on Board gender diversity, which is
available on our website at intertek.com, strongly
supports the principle of diversity and continues
to be mindful of the recommendations of the
FTSE Women Leaders Review and the Parker Review
‘Beyond One by 21’, which recommended that FTSE
100 Company Boards should have at least one
ethnically diverse Director by 2021.
As of 31 December 2022, we had four female
Non-Executive Directors representing 36% female
membership and two ethnically diverse Directors
on the Board and so met the requirements of the
Parker Review.
The gender balance, ethnicity and geographical
heritage of the Board as at the date of this report is
set out in the diagrams on the next page. Also, one
of our key performance indicators is to increase the
proportion of women in senior leadership roles to
30% by 2025. Intertek's Inclusion & Diversity policy
eliminates discrimination to ensure that employees are
treated fairly and feel respected and included in the
workplace, which is vital as our people are core to the
delivery of the best service to customers and driving
the strategy of Intertek. As of 31 December 2022, as
per the definition in the Code, the senior management
gender balance was 17 male and three female and
their direct reports were 197 male and 53 female.
Further details regarding gender balance across the
Group are outlined on page 13 within this report.
The Committee continues to monitor the overall
inclusion and diversity of Intertek’s leadership at
Board and senior management level, to ensure the
broadest range of leaders are considered for new
appointments.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Nomination Committee report Continued
Skills and experience on the Board as of 31 December 2022
70
Consulting
Risk
Management
Customer
Service/Care
People
Finance International Sustainability
Digital/
Technology
UK Listed
Company
Director
Previous/
Current CEO
UK NED
Experience
In the FTSE Women Leaders
Review published in 2022,
Intertek is ranked:
72/98
FTSE 100 rankings for Women on Boards
and in Leadership
Ranked
34/48
in the Industrial Goods & Services sector
across the FTSE 350
Director
Andrew Martin
André Lacroix
Jonathan Timmis
Graham Allan
Gurnek Bains
Lynda Clarizio
Tamara Ingram
Jez Maiden1
Kawal Preet2
Gill Rider
Jean-Michel Valette
1. Appointed 26 May 2022.
2. Appointed 31 December 2022.
Board composition and diversity as of 31 December 2022
Board balance by gender
Board balance by independence
Board tenure
Geographical heritage
Board ethnicity
Male
Female
64%
36%
18%
Executive Directors
Independent Non-Executive Directors 82%
0-3 years
3-6 years
6-9 years
46%
27%
27%
Europe
North America
Australasia
South East Asia
55%
18%
9%
18%
White
Asian
82%
18%
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 71
Audit Committee report
We were delighted to welcome Jez Maiden as a member of the
Committee on 26 May 2022. He is an experienced international public
company CFO with a strong track record, who has worked in a diverse
range of industries and sectors, primarily manufacturing, service and
finance across all geographies and has brought invaluable skills and
insights to the Committee table."
Dear shareholder,
On behalf of the Audit Committee (‘Committee’),
I am pleased, as Chair, to present the Committee’s
report for the year ended 31 December 2022, which
outlines the work of the Committee during the year.
This report aims to summarise the activities
and the responsibilities of the Committee, and is
intended to provide shareholders with an insight into
key areas considered in scrutinising the conduct of
the business, its management and auditor, to protect
the interests of our shareholders, the livelihoods of
our employees, and the confidence of our customers
and other stakeholders in the long-term financial
strength of our Group.
During 2022, whilst the Committee’s primary focus
centred on the accuracy of the Group’s financial
reporting, we have applied additional focus to assess
the risk management and the framework of internal
financial controls, together with the additional work
carried out to support the long-term viability
statement. Intertek’s business model remains
resilient, but like other companies operating during
these challenging times, we continue to closely
monitor the financial results of the Group.
The Committee has also continued to monitor the
heightened scrutiny on the external reporting of
ESG and, more specifically, sustainability and the
effects of climate change on companies. As part
of the Task Force on Climate-related Financial
Disclosures compliance, we have reviewed and
approved management’s assessment of the
physical and transitional environmental risks
and opportunities to the Group.
We advised the Board that we had reviewed the
process to ensure the 2022 Annual Report &
Accounts are fair, balanced and understandable
and provides the necessary information for our
shareholders and all stakeholders to assess the
Group’s position, performance, business model
and strategy. The process of review is described
in greater detail on page 75.
PricewaterhouseCoopers LLP (‘PwC’) completed
their seventh full audit of the Group for the year
ended 31 December 2022. During the year, the
Committee reviewed and agreed the independence
and effectiveness of the audit process in establishing
positive relationships and providing a good level of
service to the Group, whilst seeking continual
improvements in the audit of Intertek.
Throughout the year, the Committee also ensured
that separate meetings with the CFO, Group Audit
Director and the external auditor took place without
management present in order to provide an open
forum for any issues to be raised, and I also held
separate meetings, on behalf of the Committee,
with senior management within Intertek and with
PwC on a regular basis.
During 2022, we were delighted to welcome Jez
Maiden as a member of the Committee on 26 May
2022. He is an experienced international public
company CFO with a strong track record, who has
worked in a diverse range of industries and sectors,
primarily manufacturing, service and finance across
all geographies and has brought invaluable skills and
insights to the Committee table.
An evaluation of the Committee was conducted
during the year, and concluded that the Committee
continues to be effective in discharging its duties in
accordance with its Terms of Reference and the
requirements of the Code.
As Chair of the Committee, I shall make myself
available to shareholders, especially at the AGM, to
facilitate the answering of any questions that they
may have around the scope of the Committee’s
responsibilities as a whole, the Committee’s activities
throughout the year, and any other questions that
may arise from this report.
Jean-Michel Valette
Chair of the Audit Committee
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 72
Committee composition
The Board is satisfied that the Committee, led by
Jean-Michel Valette, has the recent and relevant
financial experience and competence relevant to the
sectors in which Intertek operates, required by the
Code. Jean-Michel, Gill, Jez and Lynda collectively
possess the qualities which, when complemented
by Jez’s current CFO position for Croda International
Plc and Jean-Michel's relevant Executive and recent
extensive Non-Executive financial experience,
including his current role as Chair of the Audit
Committee of the Boston Beer Company in the US,
enable an effective Committee. The Committee's
collective experience in the roles of Chief Executive
Officer and Chief Financial Officer, as well as other
senior global positions, demonstrates their ability
to oversee key risks, not just financial, as well as
maintain the intellectual curiosity and the
professional challenge needed to operate
effectively as a Committee.
During 2022, the composition of the Committee met
the requirements of the Code. Jez Maiden joined the
Committee on 26 May 2022.
On appointment, new Committee members receive
an appropriate induction, consisting of meetings
with senior management and the Group’s internal
and external auditors, a review of the Terms of
Reference, previous Committee meeting papers,
minutes, and information on the Group’s financial
and operational risks.
An overview of the background, knowledge and
experience of the Committee Chair and each of the
Committee members can be found on pages 40 to 42
and in the Notice of the AGM.
During the year, the Committee held four formal
meetings. Attendance of members at meetings is
shown in the following table.
Committee meeting attendance during the
year to 31 December 2022
Committee members
Jean-Michel Valette (Chair)
Lynda Clarizio
Jez Maiden (appointed
26 May 2022)
Gill Rider
Scheduled
meetings
eligible to
attend
Meetings
attended
4
4
2
4
4
4
2
4
100% attendance
Performance evaluation
The internal evaluation of the performance of
the Committee was conducted during the year and
entailed the completion of a detailed questionnaire
by each of the Committee members, review and
discussion of the results of the evaluation and
identifying and agreeing areas for improvement.
The Committee reviewed their functionality,
members’ individual strengths and identified any
additional training that may be beneficial. The review
concluded that this was a well run and supported
Committee with very good quality meeting materials.
It was noted that there is a good balance of current
financial knowledge and knowledgeable and
inquisitive Committee members with a broad range
of experience. It was highlighted that it would be
helpful if Internal Audit reflected and reported on
trends/bigger picture conclusions. It was shown that
the Committee is able and effective in discharging its
duties in accordance with its Terms of Reference and
the requirements of the Code.
Committee responsibilities and how
we met them in the year
The Committee has specific responsibilities
delegated to it by the Board and the full Terms
of Reference of the Committee can be found at
intertek.com. The terms of reference are reviewed
annually. The Group Company Secretary, the audit
partner and members of his team attended all
meetings held during the year. At the invitation
of the Committee, the Chairman, CEO, CFO, Group
Director of Financial Reporting and the Group Audit
Director attended meetings. Other members of
senior management were invited to attend the
meetings as necessary.
The business of the Committee is linked to the
Group’s financial calendar of events and the timetable
for the annual audit. The table overleaf outlines what
the Committee considered during 2022.
Financial Reporting
A principal responsibility of the Committee is to
monitor the integrity of the financial statements
of the Group, having regard to the matters
communicated to us by the external auditor, and
to measure the performance of the Group against
the financial goals of our strategy. This is key for our
shareholders and other stakeholders in order for them
to understand the financial strength of the business.
In order to fulfil this responsibility, we reviewed the
full-year and half-year results, as well as any formal
announcements relating to the Group’s financial
performance, prior to release. We also reviewed
significant accounting policies and confirmed that
it remains appropriate to report as a going concern.
Going concern
We received a detailed report from management with
the approach taken to the going concern statement
and viability statement which included the projected
funding requirements, the facilities available to the
Group, the sensitivity models used including an
illustrative severe yet plausible downside scenario of
a reduction of 30% to the base profit forecasts and
the corresponding impact to cash flow forecasts in
both 2023 and 2024, and the review of principal risks
and uncertainties undertaken.
The Committee reviewed the paper and challenged
the assumptions with management and after making
diligent enquiries, the Directors have a reasonable
expectation, based upon current financial projections
and bank facilities available, that the Group has
adequate resources to continue in operation and
meet its liabilities as they fall due over the period. This
conclusion is based on a review and an assessment of
the levels of facilities expected to be available to the
Group, based on levels of cash held, Group Treasury
funding projections, and the Group’s financial
projections for a period to 31 December 2024.
The undrawn headroom on the Group’s committed
borrowing facilities at 31 December 2022 was
£707.3m (2021: £564.2m). The maturity of our
borrowing facilities is disclosed in note 14 of the
financial statements in Book three with repayment
of the Acquisition facilities of £130m and US$160m
of senior notes required by 31 December 2023. The
Group Treasury funding projections forecast these
to be repaid using existing facilities following the
issuance of £640m of senior notes issued in 2022.
Following the recommendation of the Committee,
the Board continues to consider it appropriate to
adopt the going concern basis in preparing the
Group’s financial statements (as disclosed in note 1
of the financial statements in Book three, page 7)
and has approved the long-term viability statement
as set out in Book one, pages 43 and 44.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeAudit Committee report ContinuedContents External auditor
The appointment, review and relationship with the
external audit firm and the annual review of the
effectiveness of the external audit is a responsibility
that is delegated to the Committee.
The Committee monitors and reviews the
independence and objectivity of the external auditor
and reviews the effectiveness of the external audit
process. The Committee also considers and makes
recommendations to the Board, to be put to
shareholders for approval at the AGM, in relation to
the appointment, reappointment and removal of the
Group’s external auditor. It ensures that at least once
every ten years the audit services contract is put out
to tender to enable us to compare the quality and
effectiveness of the services provided by the
incumbent auditor with those of other audit firms.
A transparent and independent audit tender process
was completed in 2015 and PwC have been the
Group’s auditors since May 2016. In line with current
regulation, the Group is required to put its external
audit process out to tender again in 2025–2026.
In May 2021, Ian Chambers stepped down from his
role as the Audit Partner after serving as the Audit
Partner since May 2016, and Graham Parsons was
appointed as the new Audit Partner. Graham
attended his first Committee meeting in May 2021,
and an extensive induction took place to ensure a
smooth uninterrupted handover from Ian Chambers.
The induction included visits to Intertek locations
both in person and virtually.
The independence of the external auditor is critical
for the integrity of the audit. The Committee sought
confirmation from the auditor that they are fully
independent from the Group’s management, are free
from conflicts of interest and have assessed the
nature and level of non-audit fees paid to PwC and
have determined that PwC are fully independent.
73
Committee's activities during 2022
February
May
July
December
Management Highlights Memorandum
for the year ended 31 December 2021
Intertek Assessment of PwC
Effectiveness
Management Highlights Memorandum
for the period ended 30 June 2022
Accounting update paper for the year
ended 31 December 2022
Viability Statement
PwC Audit Plan and strategy for the
year ended 31 December 2022
Going Concern assessment
Intercompany update
Going Concern assessment
PwC Full-year 2021 views on the
control environment
PwC Interim review findings for the
period ended 30 June 2022
Group Risk Process and Viability
Statement basis of preparation for
the year ended 31 December 2022
Climate Change/TCFD reporting
Internal Audit Report Q1 2022
Letter of Representation to PwC and
Statement of Directors’ Responsibilities
for the year ended 31 December 2021
Private meeting without management
with the Group Audit Director
Letter of Representation and
Statement of Directors’ Responsibilities
for the period ended 30 June 2022
Core Mandatory Controls and Assurance
Map update
Draft 2022 Half-Year Results
Non-audit fee update
PwC report to the Committee for the
year ended 31 December 2021 and
independence confirmation
Draft 2021 Full-Year Results
Policy for engagement of External
Auditors, spend for 2021 and pre-
approval of non-audit activities for
the year ended 31 December 2022
Internal Audit Report Q4 2021
2022 Rolling Committee Agenda
2021 Evaluation of the Committee
Committee Terms of Reference
Private meetings without management
with (i) PwC and then (ii) the CFO
Internal Audit Q2 2022 update, draft
2023 audit plan and organisation
update
PwC pre-year-end accounting and
controls update
Private meetings without management
with (i) PwC and then (ii) the CFO
Internal Assessment of Internal Audit
effectiveness
Internal Audit Report H2 2022
Internal Audit Plan for 2023 and Internal
Audit Charter
Private meetings without management
with Group Audit Director
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeAudit Committee report ContinuedContents 74
The responses to the annual appraisal questionnaire
were collated and incorporated into the planning
process for the following areas: Planning, Fieldwork
and Reporting.
Following this review, the Committee considered in
detail the feedback received from a selection of
Intertek personnel, including Committee members,
Group functions, regional finance teams and country
finance managers. The feedback scores from the
survey demonstrated an increase in the score
compared with the prior year for one of the three
sub-categories, namely reporting. The overall
perception of PwC’s effectiveness remains positive,
with 97% of respondents either agreeing or mostly
agreeing with the statements outlined in the
questionnaire, in line with prior year.
Overall, the audit went smoothly particularly given
the continuing challenge of performing the audit
remotely in many locations. Indeed, several
respondents commented that there were efficiencies
gained from this approach at Group-level with
meetings becoming more targeted and focused.
There is a good collaborative approach ensuring
year-round communication and engagement with
opportunity to better integrate Tax, IT and other
workstreams. The audit findings and the areas to
improve were discussed at the May 2022 Committee
meeting and PwC effectively addressed questions
and challenges provided by Committee members.
The Committee concluded, at the meeting held in
May 2022, that PwC remained independent and that,
overall, PwC had completed a robust and fit-for-
purpose audit process across the Group with a
satisfactory level of resources.
The effectiveness of the 2022 audit of the Group
will be reviewed by the Committee in May 2023.
Audit and non-audit fees
The Terms of Reference of the Committee include
ensuring the continued independence and objectivity
of the Group’s external auditors. This is achieved
through:
• the annual approval of the policy for the
In the event that an engagement for non-audit
services arises, the policy is designed to ensure that
the external auditor is only appointed where it is
considered to be the most suitable supplier of the
service and the necessary prior approvals have been
given in accordance with the policy.
engagement of external auditors for audit
and non-audit services;
• setting limits for non-audit spend for the
external auditors;
• an annual review of the Group Auditor’s
performance in conducting the external audit
(presented at the May 2022 Audit Committee
meeting);
• a five-year maximum tenure period for the
external audit partner; and
• where appropriate, audit tendering and rotation.
The Group has set out a policy on the provision of
non-audit work by the external auditor consistent with
the 2019 Ethical Standard issued by the FRC, and it is
designed to ensure that the provision of such services
does not create a threat or compromise the external
auditor’s independence and objectivity. The policy
outlines in detail the services that the external auditor
cannot provide including tax services and services that
involve playing any part in the management or
decision-making of the audited entity amongst others.
It identifies certain types of engagement that the
external auditor shall, subject to the audit cap, be
permitted to undertake, including with respect to
audit-related services such as reporting required by
law or regulation to be provided by an auditor,
reviewing interim financial information, reporting on
regulatory returns, reporting to a regulator on client
assets and reporting on government grants. With
respect to non-audit services, the policy outlines the
services that can be provided by the external auditor
as required by law or regulation and are exempt from
the non-audit fee cap.
The Committee annually reviews and re-approves
the framework of permitted non-audit services as
set out in the policy, taking into account any changes
in legislation and best practice. The Committee
reviewed the policy in 2022 and no major changes
were made. PwC also provides an update on the
spend for non-audit services twice a year. For 2022,
the Committee pre-approved a total non-audit spend
of £234,000 (2021: £250,000).
As per the policy, all non-audit services must be
approved by the CFO, and in the event that the
pre-approved limit is exceeded, the Committee
Chair and the CFO have to approve an increase
to the pre-approved limit. In 2022, this process
operated effectively.
A summary of the fees paid for non-audit services
is set out on the next page. The majority of the
non-audit fees related to a review by PwC of the
Interim Results announcement, which is deemed a
non-audit service. This was considered appropriate
as PwC also audit the full-year results.
Further information is contained in note 4 to the
financial statements in Book three, page 12.
Effectiveness of the external audit process
The Committee conducts an annual review to assess
the independence and objectivity of the external
auditor and the effectiveness of the audit as part of
the year-end process. This process is conducted in
three parts as outlined below:
1. PwC presents to the Committee its approach to
safeguarding and maintaining the quality and
independence of their audit of the Group and their
auditors, including addressing any risks they face
in maintaining audit quality across their network.
This is an extensive report covering all aspects of
the audit from the scope of work, reporting the
outcomes of findings, the key audit matters, fraud
and investigations, intercompany transactions,
treasury, key risks, going concern and the IT
environment. Each aspect is reviewed and debated
with the auditors. The Committee was satisfied
that the audit was extensive, sufficiently
challenging and robust.
Following the completion of PwC’s 2021 audit,
the Chair was informed that the Supervision
Committee of the Financial Reporting Council
('FRC') had chosen to undertake a thematic review
of Intertek’s judgements and estimates in the
2021 Annual Report & Accounts. The review
stated that there were no questions or queries
raised, noting that the FRC’s role is not to verify
the information provided but to consider
compliance with the reporting requirements.
2. The views of management and the Directors on
PwC’s service, level of challenge, and application
of professional judgement are obtained via a
questionnaire, and subsequent follow up as
necessary. The feedback is then presented to
the Committee.
3. The key findings and recommendations from both
processes, together with any form of appropriate
external evaluation such as feedback from
shareholders and the FRC Audit Quality Inspection
Report then form the basis of the assessment of
PwC’s effectiveness, together with the Committee’s
experience of dealing with PwC during the year.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeAudit Committee report ContinuedContents Audit fee breakdown for services provided
by PwC in 2022
Total non-audit fees
– audit-related services
– tax services
– other non-audit
services
Audit fee
% of audit fee
2022
£m
0.2
0.2
–
–
5.9
3%
2021
£m
0.1
0.1
–
–
4.7
2%
The Statutory Audit Services for Large
Companies Market Investigation (Mandatory
Use of Competitive Tender Processes and
Audit Committee Responsibilities) Order 2014
(‘CMA Order’) – Statement of compliance
The Group confirms that it complied with the
provisions of the CMA Order for the financial year
under review.
75
In 2022, the Committee:
• Oversaw the independence of Internal Audit
by maintaining a direct independent reporting
line between the Group Audit Director and the
Committee Chair, and by meeting with the
Group Audit Director without the presence
of management.
• Approved the 2023 audit plan which is
determined using a risk assessment of the
existing methodology and audit frequency
standards taking into account the results of
2022 audit activity.
• Reviewed reports on internal audit activities
including overall progress in delivering the plan
and summaries of each audit performed, with
commentary on compliance with the financial
controls framework, areas of good practice and
areas for improvement.
• Reviewed the financial CMCs trend data from
2018 to 2022. The Committee has noted a steady
improvement in audit scores over the period since
the introduction of the CMCs framework.
• Monitored management progress on addressing
open audit actions.
• Reviewed the annual assessment on the
effectiveness of the Group Internal Audit
function which included feedback from key
business stakeholders. An action plan for areas
of improvement was approved.
The Committee satisfied itself that the quality,
experience and expertise of the function is
appropriate for the business.
Internal audit
The Group has an Internal Audit function, whose
activities are overseen by the Committee, which
provides assurance over compliance with the
Group’s framework of financial Core Mandatory
Controls ('CMCs').
The Committee monitors and reviews the
effectiveness and resources of the Internal Audit
function. To this end, the Committee approves the
Internal Audit programme and charter for the year.
The Committee reviews the internal audit reports
and monitors management’s responsiveness to the
findings and recommendations of the Group Audit
Director, as well as approving the appointment and
removal of the Group Audit Director as appropriate.
The Committee noted that, despite the ongoing
pandemic extending into 2022, the Internal Audit
team had completed one more report than had been
issued in 2021. When reviewing the summary
findings, management responses, progress against
audit recommended improvement plans and average
compliance scores, the Committee were satisfied
that the Internal Audit function continued to work
effectively and focus its activities in the areas with
most need.
Independent review of effectiveness
An independent review of effectiveness, which
is generally carried out every three years, was
undertaken by Grant Thornton in 2019. Their
approach considered four key areas: Performance,
Planning, People and Positioning. The review
concluded that Internal Audit is a valued function
of the business and that their role in defining
expectations and improving compliance with the
financial CMCs is widely acknowledged. They further
concluded that the function exhibits a number of
areas of good practice, in particular in the continuous
improvement agenda of the team, as well as their
innovative processes and reporting. The report also
highlighted that the remit of the Internal Audit role
could evolve and expand in the future. Given
dislocations due to Covid-19, the next review
of effectiveness will be in 2023.
Fair, balanced and understandable assessment
The Code states that through its financial reporting,
the Board should provide a fair, balanced and
understandable assessment of the Group’s
position and prospects. We, at the Board’s request,
reviewed the process for determining whether,
when taken as a whole, the 2022 Annual Report
& Accounts meets the standard prescribed.
In justifying this statement, the Committee has
considered the robust process that underpins it,
which includes:
• clear guidance and instruction given to all
contributors, including at business line level;
• revisions as a result of regulatory requirements
monitored on a regular basis;
• pre-year-end discussions held with the external
auditor in advance of the year-end reporting
process;
• pre-year-end input provided by the senior
management team and from corporate functions;
• a verification process dealing with the factual
content of the reports to ensure accuracy and
consistency;
• comprehensive review by the senior management
team to ensure overall consistency and balance;
• review conducted by external advisers and
the external auditor on best practice regarding
the content and structure of the Annual Report
& Accounts;
• review and consideration of the financial
statements by the Committee; and
• final sign-off by the Board.
The Board determined that the 2022 Annual Report
& Accounts, when taken as a whole, provides
a fair, balanced and understandable assessment
of the Group’s position and prospects, whilst
simultaneously providing shareholders with the
necessary information to facilitate their assessment
of the Group’s position, performance, business model
and strategy.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeAudit Committee report ContinuedContents In accordance with the Code, the external auditor
prepares a report for the Committee on both the
half-year and full-year results, which summarises
the approach to key risks in the external audit and
highlights any issues arising out of their work on
those risks, or any other work undertaken on
the audit.
During the year, the Committee reviewed and
considered the following estimates and areas of
judgement to be exercised in the application of
the accounting policies:
76
An online questionnaire requesting confirmation of
adherence to controls: financial, operational, HR and
IT is sent to all Intertek operations. Where corrective
actions are needed, the country is required to
provide an outline and a confirmed timeline. The
results are used as an input for the Internal Audit
and Compliance Audit assurance work for 2023.
Self-assessment responses are consolidated for review
at a regional level, with further review and sign-off of
the consolidated self-assessments in the regional risk
committees, before a final consolidated CEO and CFO
review. A final summary assessment is provided to the
Committee. The self-assessment exercise has been
reviewed during the year to ensure global coverage
and to reflect Intertek’s operational and financial
structure, and in order to enhance the alignment of
the self-assessment to the assurance process.
We annually review and approve the statements to be
included in the Annual Report & Accounts to ensure
they remain relevant to the Group's strategy and
operations as well as complying with any regulatory
requirements. A detailed verification programme also
provides assurance to the Committee and the Board
when checking that all the statements made in the
Annual Report & Accounts are accurate. Intertek’s
Manual of Accounting Policies and Procedures is
issued to all finance staff giving instructions and
guidance on all aspects of accounting and reporting
that apply to the Group. The Committee can confirm
that it reviewed the Group’s internal controls and risk
management systems and concluded that there was
an effective control environment in place across the
Group during 2022, and up to the date on which these
financial statements were approved. No significant
failings or weaknesses were identified.
Whistleblowing and fraud
We reviewed the adequacy and security of
the Group’s arrangements for its employees and
contractors to raise concerns, in confidence, about
possible wrongdoing in financial reporting or other
matters ensuring that these arrangements allow
proportionate and independent investigation of
such matters and appropriate follow-up action.
The whistleblowing hotline is well-publicised and
can be used by all employees, contractors and others
representing Intertek, or by third parties such as
our customers or people who are affected by our
operations. This whistleblowing hotline is run by an
independent, external provider. It is multi-language
and is accessible by phone and by email 24 hours a
day. Further information on the whistleblowing
hotline can be found on page 50.
In addition, we review the Group’s systems and
procedures for detecting fraud and the prevention
of bribery and receive regular reports on non-
compliance and keep under review the adequacy
and effectiveness of the Group Compliance function.
Significant issues considered
by the Committee
In preparation for each year-end, the Committee
reviews the significant accounting policies,
estimates and judgements to be applied in the
financial statements and discusses their application
with management. The external auditor also
considers the appropriateness of these assessments
as part of the external audit. The Committee’s views,
comments and their insights are used to inform the
processes and approach taken by management in all
areas of significant risk, thus facilitating a Group-
wide consistent and prudent approach.
Internal control and risk management systems
The Board ultimately reviews the Group’s risks,
controls and compliance and mitigation actions. The
Committee is responsible for reviewing the adequacy
and effectiveness of that risk framework. We have an
integrated approach to getting assurance that our
risks are being appropriately and effectively
identified and addressed. Further information on how
Intertek has implemented an end-to-end integrated
approach to risk, control and compliance is outlined
on page 50.
‘Doing Business the Right Way’ is at the heart of
what we do and is a key enabler of our 5x5 strategy
for growth. The Intertek CMCs are an integral part
of ‘Doing Business the Right Way’, and provide the
mechanism by which we define, monitor and
achieve consistently high standards in our control
environment throughout the whole organisation.
At the end of the year, the Committee undertook
a review of the effectiveness of the CMCs and
Assurance Map to ensure that they continued to
be fit for purpose. Where non-compliances with the
current CMCs were identified in the 2022 internal
audit review process, remediation plans have been
put in place. For 2023, the effectiveness of the
process was reviewed and there were additional
controls introduced to address the areas for
improvement identified in 2022.
The new controls for 2023 relate to the collection
and reporting of GHG, commuting, net zero and
other environmental/sustainability data. Training
on the financial CMCs is mandatory for all finance
team members, with certification for successful
completion of scenario-based test questions.
The training is available in multiple languages.
In order to provide assurance that the Intertek
controls and policy framework is being adhered to,
a self-assessment exercise is undertaken across the
Group’s global operations. This exercise is reviewed
and refreshed each year to align with the updated
control framework and to support the continued
development of the Group’s control environment.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeAudit Committee report ContinuedContents 77
Area of Judgement
Committee comment
Claims
Taxation
From time to time, the Group is involved in various claims and lawsuits incidental to the ordinary course of business. The Committee considered the claims provision which
reflects the estimates of amounts payable in connection with identified claims from customers, former employees and others. The Committee noted that once claims have
been notified, the finance teams liaise with the business to determine whether a provision is required, based on IAS 37 Provisions, Contingent liabilities and Contingent
assets (‘IAS 37’).
The level of provision is subsequently reviewed on a regular basis with the Group General Counsel, taking into account the advice of external legal counsel. The Committee,
following assurance from management and review of the position by the external auditors, considered and agreed that the claims provision, and associated disclosures,
were appropriate given the size and status of claims reported.
The determination of profits subject to tax is calculated according to complex laws and regulations, the interpretation and application of which can be uncertain. In
addition, deferred tax assets and liabilities require judgement in determining the amounts to be recognised, with consideration given to the timing and level of future
taxable income. The main areas of judgement in the Group tax calculation are the expected central tax provisions for the full year, including provisions related to transfer
pricing risk, and the recognition of the UK deferred tax asset.
Twice a year, the Committee receives a report from management providing an evaluation of existing risks and tax provisions which is reviewed by the Committee. The
Committee also considered reports presented by the external auditors before determining that the levels of tax provisioning were appropriate.
Revenue Recognition
IFRS 15 Revenue from Contracts with Customers requires an entity to recognise revenue in a way that shows the transfer of goods/services promised to customers is
an amount that reflects the expected consideration in return for transferring control of those goods or services to the customer.
Acquisitions and fair value accounting
The Committee reviewed the work completed regarding revenue and, taking into account the views of the external auditors, agreed that the treatment was appropriate.
The Committee was advised of the approach taken to the acquisition made in 2022 where the related fair value was recognised on a provisional basis. Such provisional
amount is subsequently finalised within the 12-month measurement period, as permitted by IFRS 3. Details of the acquisition in 2022 are set out in note 10 in Book three,
page 21.
The Committee, following assurance from management and review of the position by the external auditors, was satisfied that the treatment was appropriate.
Impairment of Goodwill and other acquired
intangible assets
The Group is required to make judgements to estimate the fair value of assets and liabilities acquired; in particular, the amounts attributed to intangible assets such as
titles, brands, acquired customer lists and associated customer relationships. These judgements impact the amount of goodwill recognised on acquisitions. As outlined
in note 9 the Group has £1,418.4m of Goodwill which has arisen on acquisitions. An impairment assessment is required at least annually in respect of this amount.
The Committee noted the update as at the year-end and, taking into account the acquisition made during the year, and after seeking views from the external auditors,
agreed the disclosure in note 9 in Book three, pages 18 to 21.
Accounts receivable and accrued income
The Group takes a prudent approach to provisioning of accounts receivable and accrued income balances in line with IFRS 9 Financial Instruments.
Consideration of Climate Change
Pensions
The Committee noted the update as at the year-end and, considering the views of the external auditors, agreed that the Group’s provision was appropriate.
Mandatory TCFD reporting for premium listed entities has driven significant momentum regarding climate change related disclosures. The Group has set out its
consideration of climate change in respect of an impact on the financial reporting judgements and estimates arising from our assessment of climate change on the
Group as a whole.
The Committee reviewed the approach taken to consider the impact of climate change and the disclosures in Book one, pages 49 to 57 and taking into account the
feedback from the external auditors agreed the approach taken and the related disclosures.
The Group operates a number of post-employment plans. In most locations, these are defined contribution arrangements. However, there are material defined benefit
schemes in the United Kingdom and Switzerland.
Having considered advice from external actuaries and assumptions used by companies with comparator plans, the Committee agreed that the assumptions used to
calculate the income statement and balance sheet assets and liabilities for post-employment plans were appropriate (see note 16 in Book three, page 33).
Following reviews and discussions throughout the year of all the relevant papers presented and after considered discussion with management and the external auditors, the Committee had an understanding of the business
rationale for transactions and how they were being recorded and disclosed in the financial statements, and therefore agreed that the estimates and areas of judgement exercised by management were appropriate.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeAudit Committee report ContinuedContents 78
Remuneration Committee report
2022 was more challenging than expected. The Board is
confident that our Remuneration Policy and rewards reflect
the performance of the Company for all stakeholders in a
fair and consistent manner."
Dear shareholder,
I am delighted to present our Remuneration Report
for the year ended 31 December 2022.
Business context
2022 was more challenging than expected
with the global economy being impacted by the
compounding effect of three consecutive shocks:
a global pandemic in 2020, a major disruption of
the world’s supply chains in 2021 and the return
of inflation in 2022.
Despite this challenging backdrop, we saw higher
demand for our industry-leading ATIC solutions
enabling us to deliver strong like-for-like revenue
growth and our acquisitions of JLA, SAI and CEA
performed well. We continue to provide sustainable
returns for our shareholders and believe we are well
positioned to benefit from the growth acceleration
in our end-markets. The key highlights of our 2022
performance are:
• Revenue of £3,192.9m; +8.2% at constant rates;
+14.6% at actual rates
• LFL revenue growth of 4.9% at constant rates
• Adjusted operating profit of £520.1m, up 3.8%
at constant rates and up 9.7% at actual rates
• Robust adjusted operating margin of 16.3%,
(70bps) year-on-year at constant rates and
(70bps) at actual rates
• Adjusted diluted EPS of 211.1p: up 4.6% at
constant rates and up 10.6% at actual rates
• Good cash conversion of 124% delivers adjusted
cash flow from operations of £722m, up £26m
on 2021
• Strong balance sheet with 1.1x net debt to
EBITDA; weighted average interest rate of 2.7%
• ROIC of 18.0%, up year-on-year by 20bps at
constant rates and down 20bps at actual rates
• Sustainable returns to shareholders with full year
dividend of 105.8p in line with 2019, 2020, 2021
Pay for performance in 2022
In keeping with our Group’s Core Purpose of “Bringing
Quality, Safety and Sustainability to life”, and following
discussions with our shareholders, we introduced an
ESG element into the annual incentive framework
with a view to further focus the organisation on our
priorities and performance in this area. The annual
incentive for 2022 was therefore based on: 70%
matrix of Revenue and Adjusted Operating Profit
Growth, 15% ROIC and 15% Carbon Emissions.
Notwithstanding the strong performance delivered
in the year, demonstrated by 4.9% like for like
revenue growth at constant rates, 3.8% adjusted
operating profit growth at constant rates and robust
adjusted operating margin of 16.3%, based on our
performance against stretching targets set at the
start of the financial year, the Committee approved
an annual incentive result of 20.58% of maximum.
This was largely as a result of the zero pay-out under
the Revenue and Adjusted Operating Profit Matrix
which accounts for 70% of the total annual incentive
award. Despite our robust revenue performance,
operating profit performance was slightly below
2022 budget, which meant zero pay-out under this
element. Any pay-out under this element of the
award is only achieved if both revenue and operating
profit meet the stretching targets set. 50% of the
annual incentive award will be deferred into shares
for three-years. The majority of our employees have
an annual incentive award that is linked to the same
metrics that we use throughout the business.
Our 2020 long-term incentive award was based on
three equally weighted metrics; Earnings Per Share,
Adjusted Free Cash Flow and Return on Invested
Capital, aligned with the Group’s 5x5 differentiated
strategy for sustainable growth. Over the longer
term, the three-year performance of the Group has
delivered EPS CAGR growth of 1.4%, Adjusted Free
Cash Flow of £1,296.4m and Return on Invested
Capital of 24.3%. This has resulted in a pay-out
under the 2020 long-term incentive award of
66.67% of maximum.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 79
When determining incentive outcomes the
Committee exercised independent judgement,
taking into account a number of internal and
external considerations to determine whether
the results felt appropriate, including:
• The progress delivered by the leadership team on
pricing, productivity and cash initiatives to deliver
strong returns;
• Overall share price performance in the year and the
implementation of our progressive dividend policy,
which rewarded our shareholders with a £170.6m
pay-out for the full year 2022 dividend;
• The strategic actions taken by the leadership team
to position the Group to seize the attractive organic
and inorganic growth opportunities ahead; and
• The overall stakeholder experience over the year,
including the experience of our clients, employees
and communities.
It was the view of the Committee that the incentive
outcomes appropriately reflected performance in
the period and the wider shareholder experience,
and the Remuneration Policy operated as intended
and therefore no discretion was applied.
Wider workforce
Across the Group, our employees have shown
commitment, innovation, agility and passion to
give Intertek a unique advantage in our industry. We
truly value our people, and our focus on their health,
safety and well-being is critical to our continued
success. Intertek is compliant with minimum wage
and mandatory social contributions requirements
in all jurisdictions where we operate, and, given
the geographic spread of the Group’s operations,
employee reward is managed at local level to enable
local management to deliver the right customer and
employee experience. In recent years, the Group has
put into place a number of programmes to support
our employees, including our ‘Kindness’ global
wellbeing programme and our refreshed Employee
Safety and Wellbeing Policy. It is our people’s
unwavering commitment to our customers that
has driven Intertek’s performance throughout the
pandemic and through this economically turbulent
period, and we will continue to support them through
these challenging times.
With regards to salary budgets, we are acutely aware
of the challenges our employees are facing with the
current inflationary environment across the world. In
making salary budget decisions, the Group balanced
the challenges our employees are facing with the
wider approach to cost discipline. The overall salary
budget for the Group was therefore set with the
focus being on providing the largest increases to
those on the lowest incomes. Across the UK, the
salary budget has been agreed at 2.0%, with the UK
representing c.5% of Intertek’s employee population.
Implementation of our Remuneration Policy
in 2023
The Committee continues to believe that our
Remuneration Policy is working well and achieving
our business objectives and no major changes are
proposed to the implementation of our Policy for
2023. Our Remuneration Policy is delivered
consistently at all levels of the wider workforce and
the alignment of performance metrics throughout the
organisation is one of the key aspects of our Policy.
With regard to salary, the Committee has awarded
the CEO and CFO a 2.0% salary increase in line with
the wider UK workforce increase of 2.0%.
There will be no change to the CFO’s pension
contribution of 5% of salary. As reported last year,
the CEO’s pension contribution will continue to
reduce by 5% each year over the next two years until
it is in line with the wider UK workforce and the CEO’s
pension contribution will reduce to 15% with effect
from 1 June 2023.
The maximum annual incentive opportunity will
remain at 200% of salary for the CEO and CFO, in line
with the Policy. The annual incentive will continue to
be based 85% on financial metrics and 15% on ESG,
with no proposed change to the annual incentive
measures which the Committee believes continue
to align with our strategy and our Core Purpose.
Long-term incentive awards will be granted to the
CEO and CFO in 2023, with no changes to the award
sizes (CEO: 300% of salary; CFO: 200% of salary) or
performance measures which continue to support the
Group’s 5x5 differentiated strategy for sustainable
growth. Details of the underlying targets for the
2023 long-term incentive awards are set out on
pages 89 to 90.
Alignment with strategy and purpose
Our Core Purpose of “Bringing Quality, Safety and
Sustainability to life” continues to be central to
everything we do. Across the organisation our people
are excited by the opportunity we have to deliver our
Purpose every day. Our Purpose is supported by our
Values. We pride ourselves in living our Values, with
integrity and fairness sitting at the heart of all our
decisions. We believe that our Remuneration Policy
and its implementation are value-based, and will
create sustainable momentum for the business, our
people, our customers and our shareholders in the
years to come, whilst also supporting the sustainable
delivery of Intertek’s clear and powerful differentiated
5x5 growth strategy.
Shareholder engagement
I would like to take this opportunity to thank our
shareholders for their support for our Directors’
Remuneration Report at our 2022 AGM. Shareholders
and their representatives have engaged extensively
with us in recent years as we have developed our
approach to remuneration at Intertek and they have
always provided valuable insight and feedback to the
Remuneration Committee. The Board is confident
that remuneration at Intertek continues to be aligned
to our shareholder interests and carefully designed
to support our strategy. I look forward to your
support at our forthcoming AGM.
Yours sincerely,
Gill Rider
Chair of the Remuneration Committee
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents
Directors’ Remuneration Policy
The section below sets out the Remuneration Policy
for Executive and Non-Executive Directors, which
was approved by shareholders at the AGM on 26 May
2021. There is no change to the Remuneration Policy
this year in line with the normal three-year Policy
cycle. The full Policy is set out in the 2020 Annual
Report & Accounts which can be found at intertek.
com/investors. Some sections of the Policy have been
updated to reflect how it was applied in 2022 and our
proposed implementation of the Policy in 2023.
In determining the Remuneration Policy, which was
approved in 2021, the Committee followed a robust
process which included discussions on the content
of the Policy at two Remuneration Committee
meetings. The Committee considered input from
management, although conflicts of interest were
managed with decisions being taken by the
members of the Remuneration Committee and
our independent advisers, as well as in the context
of best practice and guidance from our major
shareholders and the proxy advisory bodies.
Policy overview
We continue to focus on ensuring that our
Remuneration Policy is appropriate for the nature,
size and complexity of the Group, encourages our
employees in the development of their careers, is
aligned with the Company’s strategy and is in the
best interests of the Company and its stakeholders.
It is directed to deliver continued sustainable
profitable growth.
Our remuneration strategy is to:
• align and recognise the individual’s contribution to
help us succeed in achieving our 5x5 differentiated
strategy for sustainable growth;
• attract, engage, motivate and retain the best
available people by positioning total pay and
benefits to be competitive in the relevant market
and in line with the ability of the business to pay;
• reward people equitably for the size of their
responsibilities and performance; and
• motivate high performers to increase shareholder
value and share in the Group’s success.
Each year the Committee approves the overall
reward strategy for the Group and sets the individual
remuneration of the Executive Directors and certain
senior management. The Committee reviews the
balance between base salary and performance-
related remuneration against the key objectives and
targets so as to ensure performance is appropriately
rewarded. This also ensures outcomes are a fair
reflection of the underlying performance of the Group.
80
As a global service business, our success is critically
dependent on the performance and retention of our
key people around the world. Employment costs
represent the major element of Group operating
costs. As a global Group, our pay arrangements take
into account both local and international markets and
we operate a global Remuneration Policy framework
to achieve our reward strategy. Our benchmark peer
groups for the majority of our employees consist
of international industrial or business service
organisations and similar-sized businesses. For our
more senior executives we base our remuneration
comparisons on a blend of factors, including sector,
job complexity, location, responsibilities and
performance, whilst recognising the Company
is listed in the UK.
We believe that a significant proportion of
remuneration for senior executives should be related
to performance, with part of that remuneration being
deferred in the form of shares and subject to
continued employment and longer-term performance.
We also believe that share-based remuneration
should form a significant element of senior
executives’ compensation, so that there is a strong
link to the sustained future success of the Group.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents Purpose and link to strategy
Operation
Maximum opportunity
Performance measures
81
Remuneration Policy for Directors
The following table sets out the key aspects of the Remuneration Policy for Directors.
Element of pay
Base salary
To attract and retain high
performing Executive Directors
to lead the Group.
The Committee normally reviews salaries annually,
taking account of factors including, but not limited to,
the scale of responsibilities, the individual’s experience
and performance.
Benefits
To provide competitive benefits to
ensure the wellbeing of employees.
Whilst the Committee takes benchmarking
information into account, its decisions are based
primarily on the performance of the individual
concerned against the above factors to ensure that
there is no unjustified upward ratchet in base salary.
Benefits include, but are not limited to, annual
medicals, life assurance cover of up to six times base
salary, allowances in lieu of a company car or other
benefits, private medical insurance (for the individual
and their dependants) and other benefits typically
provided to senior executives.
Executive Directors can participate in any all-
employee share plans operated by the Company
on the same basis as all other employees.
There is no prescribed maximum salary
or annual increase.
Individual performance is taken into account
when salary levels are reviewed.
In awarding any salary increases, the
Committee is guided by the general
increase for the employee population
but on occasions may need to recognise
other factors including, but not limited
to, development in role, change in
responsibility and/or variance to market
levels of remuneration.
The total value of these benefits
(excluding the all-employee plans)
will not normally exceed 12% of salary.
n/a
The maximum opportunity under any
all-employee share plan is in line with all
other employees and is as determined
by the prevailing HMRC rules.
Pension
To provide competitive retirement
benefits.
Executive Directors can elect to join the Company’s
defined contribution pension scheme, receive pension
contributions into their personal pension plan or
receive a cash sum in lieu of pension contributions.
For new Executive Directors pension
provisions will be in line with those of
the wider UK workforce (currently 5%
of salary).
n/a
For current Executive Directors –
reducing from 30% of salary by 5% each
year for five years until it is in line with
the wider UK workforce (currently 5% of
salary). In line with that commitment,
it will reduce to 15% this year.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 82
Element of pay
Purpose and link to strategy
Operation
Maximum opportunity
Performance measures
Annual Incentive Plan (‘AIP’)
To drive the short-term strategy
and recognise annual performance
against targets which are based on
business objectives.
Awards are based on Group annual performance
targets, with performance targets normally set
annually by the Board.
The maximum opportunity in respect
of a financial year is 200% of salary for
each Executive Director.
Incentive outturns are normally assessed by the
Committee at the year-end, taking into account
performance against the targets and the underlying
performance of the business.
The Committee has the ability to
adjust the performance measures if
not appropriate in the context of overall
performance.
The payout at below threshold performance is 0% of
maximum, with 25% of the maximum bonus normally
payable for threshold performance. Payouts between
threshold and maximum (100%) are determined on an
annual basis. Details of the payout schedule will be
disclosed in the relevant Directors’ Remuneration
report.
Normally, 50% of any incentive is paid in cash and 50%
deferred into shares which will vest after a period of
three years subject to continued employment.
Malus and clawback provisions apply.
The Committee can adjust upwards
the incentive outturn (up to the
maximum set out above) to recognise
very exceptional circumstances or to
recognise circumstances that have
occurred which were beyond the direct
responsibility of the executive and the
executive has managed and mitigated
the impact of any loss.
Long Term Incentive Plan
(‘LTIP’)
To retain and reward Executive
Directors for the delivery of
long-term performance.
Annual grant of conditional shares which vest after
three years, subject to Company performance and
continued employment.
Up to 300% of salary in respect of any
financial year.
To support the continuity of the
leadership of the business.
Awards may be made in other forms (e.g. nil-cost
options) if considered appropriate.
To provide long-term alignment
of executives’ interests with
shareholders by linking rewards
to Intertek’s performance.
The shares will also normally be subject to a two-year
holding period after vesting.
Performance targets are normally set annually for
each three-year performance cycle by the Board.
Vesting is normally assessed by the Committee
after the end of the performance period, taking
into account performance against the targets
and the underlying performance of the business.
The Committee has the ability to adjust incentive
payments if it believes that out-turns are not
appropriate in the context of overall performance.
Malus and clawback provisions apply.
The annual incentive will be measured against
a range of key Group financial measures.
The current intention is that none of the
incentives will be subject to non-financial
measures or personal performance measures.
The Committee, however, retains the
discretion to introduce such measures in
the future, up to a maximum of 20% of
the incentive.
Were the Committee to introduce such
measures, it would normally consult with the
Company’s largest institutional shareholders.
For 2023, the annual incentive will be based
on 70% matrix of revenue and adjusted
operating profit growth, 15% ROIC and 15%
ESG. The stretch targets, when met, reward
exceptional achievement and contribution.
There is no incentive payout if threshold
targets are not met.
LTIP awards are subject to an appropriate
balance of earnings, cash and capital
efficiency based performance measures.
The Committee retains the discretion to
introduce another performance metric, with
a maximum weighting of up to one-third of
the incentive. Were the Committee to
introduce such measures, it would normally
consult with the Company’s largest
institutional shareholders.
For 2023, the LTIP award will be based on
earnings per share, return on invested capital
and adjusted free cash flow. Each measure will
have an equal weighting.
25% of an award will vest for achieving
threshold performance, increasing pro rata
to full vesting for the achievement of stretch
performance targets.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 83
Element of pay
Purpose and link to strategy
Operation
Maximum opportunity
Performance measures
Share ownership guidelines
To increase alignment between
executives and shareholders.
Post-cessation of
employment shareholding
Non-Executive
Directors’ fees
To ensure alignment of sustainable
performance between executives
and shareholders.
To attract and retain high-calibre
Non-Executive Directors through
the provision of market-competitive
fees.
500% of salary for the CEO.
n/a
300% of salary for the CFO.
n/a
n/a
Executive Directors required to hold
shares as per share ownership guidelines
for two years post-employment.
As for the Executive Directors, there is
no prescribed maximum annual increase.
The Committee is guided by the general
increase for the employee population
but on occasions may need to recognise
other factors including, but not limited to,
change in responsibility and/or variance
to market levels of remuneration.
Executive Directors are expected to retain any vested
shares (net of tax) under the Group’s share plans until
the guideline is met.
The guideline should normally be met within five
years of the guideline being set.
Further details of the share ownership guidelines and
the post-cessation shareholding guidelines are set
out in the Directors’ Remuneration report.
Holding and vesting periods for all share awards
will be adhered to post-employment.
A proportion of the fees (at least 50%) are paid in
cash, with the remainder used to purchase shares.
Fees are primarily determined based on the
responsibility and time committed to the Group’s
affairs and appropriate market comparisons.
The Chairman receives an all-inclusive fee. Non-
Executive Directors receive a base fee and further
fees for additional Board responsibilities. Additional
fees may be paid in the exceptional event that
Non-Executive Directors are required to commit
substantial additional time above that normally
expected for the role.
With the exception of benefits in kind arising from
the performance of duties (and any tax due on those
benefits which is reimbursed by the Company), no
other benefits are provided.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 84
Selection of performance metrics
The annual incentive plan is based on performance
against a mix of financial and non-financial measures.
The mix of financial measures is aligned to the Group’s
key performance indicators (‘KPIs’) and is reviewed
each year by the Remuneration Committee to ensure
that they remain appropriate to reflect the priorities
for the business in the year ahead. The targets are set
for each KPI to encourage continuous improvement
and challenge the delivery of stretch performance.
The 2023 LTIP award is based on earnings per
share growth, return on invested capital and adjusted
free cash flow. The performance metrics align with
Intertek’s earnings model, which supports delivery
of the Company’s differentiated strategy, which
aims to move the centre of gravity of the Company
towards high-growth, high-margin areas in our
industry. Earnings per share ensure that there is a
clear focus on margin-accretive revenue growth;
adjusted free cash flow ensures focus on strong cash
management; and return on invested capital ensures
a focus on disciplined capital management.
A sliding scale of challenging performance targets
is set for each measure. The Committee reviews
the choice of performance measures and the
appropriateness of the performance targets prior
to each LTIP grant. The Committee reserves the
discretion to set different targets for future awards,
without consulting with shareholders. When setting
the targets for the annual incentive and the LTIP, the
Committee takes into account a range of factors,
including the business plan, prior-year performance,
market conditions and consensus forecasts.
Terms of incentive awards
Deferred Share awards and LTIP awards may include
the right to receive (in cash or shares) the value of
the dividends that would have been paid on the
shares that vest up to the time of vesting (or for LTIP
awards, up to the end of the relevant holding period).
The Committee’s intention is that such dividends
would normally be settled in shares.
The Committee will operate the annual incentive
plan and LTIP according to the respective rules of
the plans. The Committee will retain flexibility in
a number of areas regarding the operation and
administration of these plans, including (but not
limited to) the following:
• how to deal with a change of control or restructuring
The maximum level of variable pay (annual incentive
and long-term incentive awards, or any combination
thereof) which may be awarded to a new Executive
Director at or shortly following recruitment shall be
limited to 500% of salary. These limits exclude
buy-out awards and are in line with the Remuneration
Policy for Directors set out previously.
of the Group, or a demerger or similar event
(including how to assess performance conditions
and whether to time pro-rate awards); and
• how and whether any award may be adjusted in
certain circumstances (including in the event of
a variation of share capital, demerger, special
dividend, or similar event).
The Committee also retains the discretion within
the Remuneration Policy to adjust targets and/or set
different measures and weightings if it considers it
is required so that the targets or conditions achieve
their original purpose. Revised targets/measures
will be, in the opinion of the Committee, no less
difficult to satisfy than the original conditions. The
Committee may accelerate the vesting and/or the
release of awards if an Executive Director moves
jurisdictions following grant and there would be
greater tax or regulatory burdens on the award in
the new jurisdiction.
Remuneration scenarios for
Executive Directors
The chart on the next page illustrates how the
Executive Directors’ remuneration packages vary
at different levels of performance under the Policy
which will apply in 2023 for both the Chief Executive
Officer (‘CEO’) and Chief Financial Officer (‘CFO’).
Approach to recruitment and promotions
The remuneration package for a new Executive
Director – base salary, benefits, pension, annual
incentive and long-term incentive awards – would be
set in accordance with the terms of the Company’s
prevailing approved Remuneration Policy at the time
of appointment. The Committee may set the base
salary at a value to reflect the calibre, experience
and earnings potential of a candidate, subject to
the Committee’s judgement that the level of
remuneration is in the Company’s best interest.
The Committee may offer additional cash and/or
share-based elements to take account of remuneration
relinquished when leaving the former employer when it
considers these buy-outs to be in the best interests of
the Company (and therefore shareholders).
Any such awards would reflect the nature, time
horizons and performance requirements attaching
to the remuneration it is intended to replace. Where
appropriate, the Committee retains the flexibility to
utilise Listing Rule 9.4.2 for the purpose of making
an award to buy-out remuneration relinquished when
leaving the former employer. For external and internal
appointments, the Committee may agree that the
Company will meet certain relocation expenses and
continuing allowances as appropriate. Additionally,
in the case of any Executive Director being recruited
from overseas, or being recruited by the Company
to relocate overseas to perform their duties, the
Committee may offer expatriate benefits on an
ongoing basis subject to their aggregate value to the
individual not exceeding 50% of salary per annum.
For an internal Executive Director appointment,
any variable pay element awarded in respect of
the prior role may be allowed to pay out according
to its terms, adjusted as relevant to take into
account the appointment. In addition, any other
ongoing remuneration obligations existing prior to
appointment may continue. If a new Chairman or
Non-Executive Director is appointed, remuneration
arrangements will be in line with those detailed in
the Remuneration Policy for Non-Executive Directors
set out in the Remuneration Policy for Directors.
Service contracts for Executive Directors
The service agreements of the Executive Directors
are not fixed term and are terminable by either the
Company or the Director on 12 months’ notice and
make provision, at the Board’s discretion, for early
termination by way of payment of salary and pension
contributions in lieu of 12 months’ notice. In
calculating the amount payable to a Director on
termination of employment, the Board would take
into account the commercial interests of the Company
and apply usual common law and contractual
principles. Any payments in lieu of notice may be paid
in a lump sum or may be paid in instalments and
reduce if the Director finds alternative employment.
The service contracts are available for inspection at
the Company’s registered office. The Committee
reviews the contractual terms for new Executive
Directors to ensure these reflect best practice.
In summary, the contractual provisions are:
Provision
Detailed terms
Notice period
12 months
Common
law and
contractual
principles
Remuneration
entitlements
Change of
control
Common law and contractual
principles apply
An incentive may be payable (pro
rata where relevant) and
outstanding Share Awards may
vest (see below)
No Executive Director’s contract
contains provisions or additional
payments in respect of change of
control. The treatment of annual
incentive awards and outstanding
Share Awards will be treated in
line with the relevant plan rules
There is no automatic entitlement to an annual
incentive award in the year of cessation of
employment. The Committee may determine
however, that for certain leavers an annual
incentive award may be payable with respect
to the period of the financial year served.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 85
Value of remuneration packages at different levels of performance
£’000
8,000
7,500
7,000
6,500
6,000
5,500
5,000
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
£7,985
58%
£6,443
48%
32%
26%
£3,873
40%
26%
£1,303
100%
34%
20%
16%
LTIP award
Annual incentive
Basic salary, benefits and pension
£2,788
39%
39%
22%
£3,334
49%
33%
18%
£1,696
32%
32%
36%
£603
100%
Minimum
On-target
Maximum
Maximum 2
Minimum
On-target
Maximum
Maximum 2
A Lacroix, Chief Executive Officer
J Timmis, Chief Financial Officer
Points relating to the above table:
1. Salary levels are based on those applying on 1 April 2023.
2. The value of taxable benefits is based on the cost of supplying those benefits (as disclosed) for the year ended 31 December 2022.
3. The value of pension receivable by the CEO and CFO in 2023 is taken to be 15% of salary and 5% of salary, respectively.
4. The on-target level of annual incentive is taken to be 50% of the maximum opportunity.
5. The on-target level of the LTIP is taken to be 50% of the face value of the award at grant.
6. Share price movement and dividend accrual have not been incorporated into the first three scenarios. Share price growth of 50% has been assumed on the LTIP in the Maximum 2 scenario.
Any share-based entitlements granted to an
Executive Director under the Company’s share plans
will be determined based on the relevant plan rules.
The default treatment under the 2021 LTIP,
and previously under the 2011 LTIP, is that any
outstanding awards lapse on cessation of
employment. However, in certain prescribed
circumstances, such as death, ill-health, injury,
disability or other circumstances at the discretion of
the Committee, ‘good leaver’ status may be applied.
For good leavers, Deferred Share awards will vest in
full on the original vesting date (as permitted under
the plan rules), unless the Remuneration Committee
determines that awards should vest at an earlier
date. LTIP awards will normally vest on the original
vesting date (they will normally, where appropriate,
be subject to any holding period), and subject to the
satisfaction of the relevant performance conditions
at that time and reduced pro rata to reflect the
proportion of the performance period actually
served. However, the Committee has discretion to
determine that awards vest at an earlier date and/or
to disapply time pro-rating, although it is envisaged
that this would only be applied in exceptional
circumstances (for example, death). Any such
incidents, where discretion is applied by the
Committee in relation to Executive Directors, will
be disclosed in the following Annual Report &
Accounts on Remuneration.
In determining whether an Executive Director should
be treated as a good leaver or not, the Committee
will take into account the reasons for their departure.
The Committee reserves the right to make any
other payments (including appropriate legal fees)
in connection with an Executive Director’s cessation
of office or employment where the payments are
made in good faith on discharge of an existing legal
obligation (or by way of damages for breach of their
obligation) or by way of settlement of any claim
arising in contravention with the cessation of an
Executive Director’s office or employment.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents Letters of appointment for
Non-Executive Directors
The letter of appointment for each Non-Executive
Director states that they are appointed for an initial
period of three years and all appointments are
terminable by one month’s notice on either side.
At the end of the initial period and after rigorous
review, the appointment may be renewed for a
further period, usually three years, if the Company
and the Director agree and subject to annual
re-election at the AGM. Each letter of appointment
states that if the Company were to terminate the
appointment, the Director would not be entitled to
any compensation for loss of office.
The table below sets out the terms for all the current
Non-Executive Directors of the Board.
Consideration of employment conditions
elsewhere within the Group
When setting the Remuneration Policy for Executive
Directors, the Remuneration Committee takes into
account the pay and employment conditions
elsewhere within the Group. When considering the
remuneration arrangements for the Executive
Directors for the year ahead, the Committee is
informed of salary increases across the wider Group.
The Committee also approves the overall reward
strategy in operation across the Group.
Andrew Martin
Graham Allan
Gurnek Bains
Lynda Clarizio
Tamara Ingram
Jez Maiden
Kawal Preet
Gill Rider
Jean-Michel Valette
Date of appointment
26 May 2016 becoming Chair
on 1 January 2021
Reappointed: 26 May 2022
1 October 2017
Reappointed: 1 October 2020
1 July 2017
Reappointed: 1 July 2020
Notice period/Unexpired term
as at 31 December 2022
One month/29 months
One month/nine months
One month/six months
1 March 2021
One month/14 months
18 December 2020
One month/11 months
26 May 2022
One month/29 months
31 December 2022
One month/36 months
1 July 2015
Reappointed: 1 July 2021
1 July 2017
Reappointed: 1 July 2020
One month/18 months
One month/six months
86
The remuneration strategy set out at the beginning
of the Directors’ Remuneration Policy report reflects
the strategy in place across all employees across the
Group. Although this remuneration strategy applies
across the Group, given the size of the Group and the
geographical spread of its operations, the way in which
the Remuneration Policy is implemented varies across
the Group. For example, annual incentive deferral
applies at the more senior levels within the Group
and participation in the LTIP is at the Remuneration
Committee’s discretion and is typically limited to senior
executives employed within the Group.
Given the geographical spread of the Group’s
operations, the Remuneration Committee does
not consider it appropriate to consult employees
on the Remuneration Policy in operation for
Executive Directors.
Consideration of shareholder views
The Committee values the opportunity to engage in
meaningful dialogue with its investors. In April 2022,
the Committee consulted with investors on our
approach to Executive Director remuneration and
further details on the engagement is outlined in the
Chair of the Remuneration Committee’s letter on
pages 78 and 79.
Legacy arrangements
The approved Directors’ Remuneration Policy
provides authority to the Company to honour any
commitments entered into with current or former
Directors such as the vesting of outstanding share
awards (including exercising any discretions available
to it in connection with such commitments) that
were agreed:
i. before the policy set out above, or any previous
policy, came into effect;
ii. at a time when a previous policy approved by
shareholders was in place provided that the
payment is in line with the terms of that policy;
and
iii. at a time when the relevant individual was not
a Director of the Company and the payment was
not in consideration for the individual becoming
a Director of the Company.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 87
Annual Report on Remuneration
Committee membership and meeting
attendance
Committee responsibilities and how we met them in the year
We have specific responsibilities reserved to us by the Board and the full Terms of Reference of the Committee,
which were updated in 2019 and are reviewed annually, can be found on our website at intertek.com.
Committee members
Gill Rider (Chair)
Graham Allan
Gurnek Bains
Tamara Ingram
Scheduled
meetings
eligible to
attend
Meetings
attended
4
4
4
4
4
4
4
4
100% attendance
The above members were members throughout
2022 and at all times the composition of the
Committee was compliant with the Code. All
members are independent Non-Executive Directors.
Prior to joining Intertek in July 2015, Gill had been
Chair of the Remuneration Committee at Charles
Taylor plc since January 2012. This enabled the
Nomination Committee to recommend her
appointment as Chair of the Committee which
was then approved by the Board.
On appointment, new Committee members receive
an appropriate induction consisting of meetings
with senior personnel, advisers and as appropriate,
meetings with shareholders and other relevant
stakeholders. They also review the Terms of
Reference, previous Committee meeting papers
and minutes.
The Committee invites the Chairman, CEO and the EVP,
Human Resources to attend meetings when it deems
appropriate, except when their own remuneration is
discussed. No Director is involved in determining his
or her own remuneration. None of the Committee
members has had any personal financial interest,
except as shareholders, in the decisions made by the
Committee. The Group Company Secretary acts as
Secretary to the Committee.
Matters delegated to the Committee
Determines the Company’s policy on remuneration for the Executive Directors and senior
executive management.
Determines the remuneration for the above and the Chair, including any compensation
on termination of office.
Reviews the remuneration arrangements for the wider employee population and considers
issues relating to remuneration that may have a significant impact on the Group.
Provides advice to, and consults with, the CEO on major policy issues affecting the
remuneration of other executives.
Responsible for establishing the selection criteria, selecting, appointing and setting
the terms of reference for any remuneration consultants who advise the Committee.
Keeps the Remuneration Policy under review in light of regulatory and best practice
developments and shareholder expectations and ensures that the Remuneration Policy
is voted on at least every third year. Due regard is given to the interests of shareholders
and the requirements of the Listing Rules and associated guidance.
Code provision
33, 36–40
33
33
33
35
36–40
Ensures each year that the Annual Directors' Report on Remuneration is put to shareholders
for approval at the AGM and includes a description of the work of the Committee.
41
Executive Director remuneration
We are responsible for determining the
Company’s policy on the remuneration of the
Chairman, the Executive Directors and senior
executive management. We also determine their
remuneration packages, including any compensation
on termination of office and review to ensure their
alignment with our culture and with those of the
workforce as a whole.
In the year, we addressed this by reviewing and
agreeing the remuneration of the Executive
Directors as well as the Leadership Team. We
received advice from Deloitte LLP (‘Deloitte’)
to inform our discussions.
Wider workforce remuneration
and engagement
We also review the remuneration and related policies
of the wider workforce to ensure that incentives
and rewards align to our Purpose, Values and culture.
As part of this we receive information on salary
increases, the design of the bonus and targets
and on the 2021 Long Term Incentive Plan and
performance criteria. This is used to inform decisions
when setting the policy for Executive Director
remuneration and for when we consult with, or
provide advice to, the CEO on major policy issues
affecting the remuneration of other executives.
The remuneration framework and the incentive
structure that we have in place cascades right down
through the wider workforce and ensures alignment
with executive remuneration and the 5x5 strategy.
We also took into account the UK wider workforce
salary increase when determining the 2023 salary
increase for the Executive Directors.
We ensure that we have effective engagement with
the wider workforce on the Group’s remuneration
and related policies through various escalation
processes and communication forums including Town
Halls, WhatsIn, emails and leadership briefings. The
regular Town Halls that take place across the Group
provide an opportunity for our people to raise
questions on remuneration which are addressed at
the meetings, with feedback directly fed to senior
management and then upwards.
During the year, we reviewed the salary levels for
senior management and the determination of the
annual incentive payments and long-term incentive
outcome for 2022. We considered a report on the
general market trends that could impact the Group.
Further information is provided in the letter from the
Chair of the Committee on page 79.
Remuneration Policy and report
It is important that we keep the Remuneration Policy
under review in light of regulatory and best practice
developments, Listing Rules and Governance Code
changes as well as shareholder expectations.
We regularly undertake a review of the Directors’
Remuneration report to ensure compliance with
Remuneration Reporting Regulations. We also
discussed the 2022 proxy voting agencies'
reports and their recommendations issued prior
to the 2022 AGM.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents Incentives
A key task for us each year is to review the outcomes
for the incentive schemes and agree on payment
levels taking into account actual performance and
any extraordinary events which may have impacted
on performance. We will consider if there is a need
to apply malus or clawback and, should there be, we
would agree the quantum.
We undertook, with external advice, a thorough
review of the 2022 annual incentive targets,
performance measures and the EPS and TSR results
to determine the percentage of incentive awards
that would vest in 2022 which was nil.
We also agreed the performance conditions that
should apply to the LTIP awards granted in the year
to vest based on the performance to the end of
2024. We reviewed the quantum of awards given and
were satisfied that they reflected the Remuneration
Policy and were appropriate.
Committee review
We undertake an annual review of how effectively
we are working as a Committee and take steps to
develop any areas identified for improvement.
We also reviewed how we work as a Committee,
members’ individual strengths and also any
additional training that may be beneficial. We
received updates on market trends in remuneration
from Deloitte and regular updates on corporate
governance and policy changes.
Advisers
To ensure that the Group’s remuneration practices
drive and support achievement of strategies and are
market competitive, the Committee obtains advice
from various independent sources.
We review the appointment of the remuneration
consultant and consider if they remain independent
and applicable for the needs of the Committee. In
the event that we decide that they are no longer
appropriate, we would arrange a review and any
subsequent appointment.
In 2022, the Committee received advice from
Deloitte, who they appointed in 2015 for their
particular expertise both at a local and global level,
due to the worldwide operations of the Group and,
following review, the Committee remains satisfied
that their advice is objective and independent and
has sufficient breadth of knowledge to support our
deliberations across the diverse Group as a whole.
Deloitte are members of the Remuneration
Consultants Group and adhere to the voluntary Code
of Conduct in relation to executive remuneration
consulting in the UK.
The fees paid to Deloitte in the year were £67,930
exclusive of VAT. The charges for services are
calculated on the basis of time spent and the
seniority of the personnel performing the work
at their respective rates.
In addition to the services provided to the
Committee, Deloitte provided unrelated tax services
to the Group during the year. Deloitte do not have
any connection with any Directors of the Company.
88
External appointments
The Company recognises that, during their
employment with the Company, Executive Directors
may be invited to become Non-Executive Directors
of other companies and that such duties can broaden
their experience and knowledge. Executive Directors
may, with the written consent of the Company,
accept such appointments outside the Company,
and the policy is that any fees may be retained by
the Director. No Executive Director currently has an
external appointment.
Statement of shareholder voting
At the 2021 AGM, a resolution was proposed to
shareholders to approve the Remuneration Policy.
This resolution received the following votes from
shareholders:
In favour
Against
Total
Withheld
Votes
91,627,222
41,668,760
133,295,982
2,431,490
%
68.74
31.26
82.591
1. Percentage of total issued share capital voted.
At the 2022 AGM, a resolution was proposed to
shareholders to approve the Directors’ Remuneration
report for the year ended 31 December 2021. This
resolution received the following votes from
shareholders:
In favour
Against
Total
Withheld
Votes
109,326,984
24,311,895
133,638,879
3,831,980
%
81.81
18.19
82.801
1. Percentage of total issued share capital voted.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 89
Directors’ Remuneration Policy – implementation in 2023
Elements
Base salary
Benefits
Implementation in 2023
Base salary for 2023:
• André Lacroix: £1,028,074.
• Jonathan Timmis: £546,210.
The UK workforce has been granted an average yearly salary increase of 2%.
Includes, for example, annual medicals, life assurance cover of up to six times base salary, allowances in lieu of a company car or other benefits, private medical insurance and other benefits
typically provided to senior executives. Executive Directors can participate in any all-employee share plans operated by the Company on the same basis as all other employees.
Pension
From 1 June 2023, 15% reducing by 5% each year until it is in line with the wider UK workforce (currently 5% of salary) for the CEO. 5% of base salary for the CFO.
Total value of benefits (excluding all-employee plans) will not exceed 12% of salary.
Annual Incentive Plan (‘AIP’)
Long Term Incentive Plan
(‘LTIP’)
• Maximum opportunity for the CEO and CFO: 200% of base salary.
• 50% of any incentive is paid in cash and 50% is deferred into shares vesting after three years.
• Malus and clawback provisions apply.
• Performance metrics – 70% will be based on a matrix based on revenue and adjusted operating profit growth, 15% will be based on ROIC and 15% will be based on ESG, which for 2023 will
comprise a Carbon Emissions target. Targets are not disclosed prospectively due to commercial sensitivity, however, detailed disclosure of the performance targets and actual outturns will
be provided in the following year.
• Annual incentive will continue to be subject to a quality of earnings review at the end of the year to ensure that payouts are appropriate based on the underlying performance of the Group
and to ensure that any awards are commensurate with the Group’s culture and Values.
As set out in the table below, the ROIC targets are set taking into account the stretch within the business plan and current ROIC performance. The change in the target range relative to prior
years reflects the level of invested capital at work within the business, which has increased in recent years through the Group’s strategy of making bolt-on acquisitions which complement
the Group’s business (including the 2022 acquisition of Clean Energy Associates and the two main acquisitions in 2021 of JLA Brasil Laboratório de Análises de Alimentos and SAI Global
Assurance). The Committee believes that the proposed target range for ROIC (and the wider financial metrics in the LTIP) are appropriately stretching relative to the business plan and external
forecasts of performance.
• Maximum opportunity for the CEO and CFO: 300% and 200% of base salary, respectively.
• Two-year holding period after vesting.
• Malus and clawback provisions apply.
• Performance metrics for awards being granted in 2023:
Measures
Definition
Threshold
(25%)
Maximum
(100%)
Commentary
Earnings Per
Share (‘EPS’)
(1/3)
Annualised fully diluted, adjusted EPS growth.
4% p.a.
10% p.a.
Compound annual growth rate targets.
Measured on a constant currency basis.
Per the definition used for the Group’s KPIs in Book
one, page 24.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 90
Elements
Implementation in 2023
Measures
Definition
Adjusted Free
Cash Flow (1/3)
Free cash flow generated from operations less net
capital expenditure, net interest paid and income tax
paid. Adjusted for separately disclosed items.
Measured on a constant currency basis.
Per the definition used in Book one, page 24.
Return on
Invested Capital
(‘ROIC’) (1/3)
Adjusted operating profits less adjusted tax divided
by invested capital (net assets excluding tax
balances, net financial debt and net pension
liabilities).
Measured on a constant currency basis.
Per the definition used for the Group’s KPIs in Book
one, page 24.
Threshold
(25%)
Maximum
(100%)
Commentary
£1,109m £1,189m Cumulative targets measured over three years.
Targets set taking into account stretch within business plan and expected capital
expenditure over the coming three years.
15.3%
19.3%
Cumulative adjusted operating profits divided by cumulative invested capital in each of
the three performance years.
Target set taking into account stretch within business plan, current ROIC performance,
and reflective of the Group’s strategy of making small bolt-on acquisitions which
complement the Group’s business.
The treatment of significant acquisitions would be determined at the time of the
transaction.
Share ownership guidelines
Shareholding guidelines are 500% of salary for the CEO and 300% of salary for the CFO. A post-cessation holding equivalent to the lower of the guideline target or the number of shares
held at the date of departure will be required to be held for a period of two years from the Executive's departure date.
Non-Executive Directors’ fees
Fees for the Non-Executive Directors are determined by the Board, based on the responsibility and time committed to the Group’s affairs and appropriate market comparisons. Individual Non-Executive Directors do not take
part in discussions regarding their own fees.
Board membership
Chairman
Non-Executive Director
Senior Independent Non-Executive Director
Committee membership
Chair Audit Committee
Chair Remuneration Committee
Chair Nomination Committee
Member Audit Committee
Member Remuneration Committee
Member Nomination Committee
From
1 January
2023
£’000
From
1 January
2022
£’000
350
350
62
12
20
15
–
10
10
5
62
12
20
15
–
10
10
5
Included in the fees shown in the table above, and pursuant to the policy of aligning Directors’ interests with those of shareholders, £10,000 of the fees paid to the Non-Executive Directors and £35,000 of the fees paid to the
Chairman are used each year to purchase shares in the Company.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 91
Remuneration in context
The following section sets out how the Remuneration Committee has addressed the factors in Provision 40, when determining Executive remuneration as set out in the 2018 UK Corporate Governance Code.
Code requirement
Intertek approach
Clarity
Remuneration arrangements should be
transparent and promote effective engagement
with shareholders and the workforce
Simplicity
Remuneration structures should avoid
complexity and their rationale and operation
should be easy to understand
Risk
Remuneration structures should ensure
reputational and other risks from excessive
rewards, and behavioural risks that can arise
from target-based incentive plans, are identified
and mitigated
Predictability
The range of possible values of rewards to
individual Directors and any other limits or
discretions should be identified and explained
at the time of approving the Policy
Proportionality
The link between individual awards, the delivery
of strategy and the long-term performance of the
Company should be clear and outcomes should not
reward poor performance
Alignment with culture
Incentive schemes should drive behaviours
consistent with the Company’s Purpose, Values
and strategy
Variable remuneration arrangements, which are cascaded throughout the workforce, are based on clearly defined financial performance metrics which are aligned
with the Group’s 5x5 differentiated strategy for sustainable long-term growth.
Remuneration arrangements are simple, comprising the following key elements:
• Fixed element: comprises base salary, benefits and pension, which are aligned to that offered to the majority of the workforce.
• Short-term incentive: annual bonus which incentivises the delivery of financial and non-financial performance metrics linked to ESG. Half of the bonus is paid in cash
with the balance deferred into shares vesting after a period of three years.
• Long-term incentive: LTIP which incentivises financial performance over a three-year period, promoting long-term sustainable value creation for shareholders. Awards
are subject to a two-year holding period post-vesting.
Performance targets are calibrated to be aligned with the Group’s business plan which is set in line with the Group’s risk framework.
The Remuneration Committee retains the flexibility to review formulaic outcomes to ensure that they are appropriate in the context of overall performance of the
Group, including risk.
The remuneration scenario charts, set out on page 85, provide estimates on the potential future reward opportunity in a range of scenarios, including below
threshold, target and maximum performance (including share price appreciation).
Variable remuneration is directly aligned to the Group’s strategic priorities (through the selection of key financial performance metrics), with payments calibrated
to ensure that payments are only made where strong performance is delivered.
As noted above, the Remuneration Committee retains the flexibility to review formulaic outcomes to ensure that they are appropriate in the context of the overall
performance of the Group.
As set out on page 80, the Remuneration Policy at Intertek has been set to be appropriate for the nature, size and complexity of the Group, encourages our employees
in the development of their careers, is aligned with the Company’s strategy and is in the best interests of the Company and its stakeholders.
It is directed to deliver continued sustainable profitable growth.
Our remuneration strategy is to:
• align and recognise the individual’s contribution to help us succeed in achieving our 5x5 differentiated strategy for sustainable growth;
• attract, engage, motivate and retain the best available people by positioning total pay and benefits to be competitive in the relevant market and in line with
the ability of the business to pay;
• reward people equitably for the size of their responsibilities and performance; and
• motivate high performers to increase shareholder value and share in the Group’s success through well designed and appropriately calibrated incentive schemes.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 92
The sections that have been audited are indicated as such on pages 92 to 101. The independent auditors’ report can be found in Book three, pages 54 to 60.
Directors’ remuneration earned in 2022 (audited)
The table below and on the following page summarise Directors’ remuneration received for 2022 and the prior year for comparison. Taken in the context of internal and external comparators, the Committee considered the
Executives’ remuneration to be appropriate.
Executive Directors
André Lacroix
Jonathan Timmis
2022
2021
2022
20216
Base salary or
fees
£’000
BIK arising from
performance of
duties
£’000
Benefits1
£’000
Annual incentive2
£’000
1,003
988
533
398
118
109
29
24
3
3
3
1
415
1,680
220
676
Long-term
incentives
£’000
1,2253
–4
–3
–
Pension5
£’000
Buyout awards
£’000
Total including
buyout awards
£’000
221
268
27
13
–
–
–7
2,1877
2,985
3,048
812
3,299
Total fixed
Total variable
£’000
1,345
1,368
592
436
£’000
1,640
1,680
220
2,863
1. Benefits include allowances in lieu of company car, annual medicals, life assurance, private medical insurance and the use of a car and driver for the CEO ( gross £36,255, net £19,940).
2. This relates to the payment of the annual incentive and Deferred Share Award for the financial year-end. Further details of this payment are set out on the following pages.
3. This relates to the 2020 LTIP award due to vest May 2023. Further details on performance are set out on page 95. There was no discretion exercised in respect of the awards.
4. This relates to the 2019 LTIP award which was due to vest in March 2022 where the performance outcome gave rise to nil vesting. There was no discretion exercised in respect of the awards.
5. None of the Executive Directors had a prospective entitlement to a defined benefit pension.
6. This relates to the period from 1 April 2021 when Jonathan Timmis was appointed as a Director.
7. This relates to the buyout awards granted to Jonathan Timmis when he joined the Company on 1 April 2021. Further information on these awards is outlined in our 2020 Directors' Remuneration report.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents Non-Executive Directors
Andrew Martin (appointed Chair 1 Jan 2021)
Graham Allan
Gurnek Bains
Lynda Clarizio (appointed 1 March 2021)
Tamara Ingram
Jez Maiden (appointed 26 March 2022)
Kawal Preet (appointed 31 December 2022)
Gill Rider
Jean-Michel Valette
2022
2021
2022
2021
2022
2021
2022
20214
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
93
Base salary or fees1
£’000
Benefits2
£’000
350
350
89
89
77
77
72
58.5
75
67
375
–
–
–
87
86
82
82
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
BIK arising from
performance of
duties3
£’000
10
–
–
–
–
–
5
1
–
–
3
–
–
–
1
0.5
4
1.5
Total
£’000
360
350
89
89
77
77
77
59.5
75
67
40
–
–
–
88
86.5
86
83.5
1. Pursuant to the policy of aligning Directors’ interests with those of shareholders, the fees shown as being paid to the Non-Executive Directors include £10,000 used to purchase shares and the fee paid to Chairman includes £35,000 used to purchase shares.
2. With respect to the Non-Executive Directors no other benefits are provided.
3. Certain expenses relating to ensuring that the Directors were in a position to undertake the performance of their duties (not included in the Benefits column above) such as travel to and from Company meetings, related accommodation and completion of UK tax returns for overseas Directors
have been classified as taxable. In such cases, the Company will ensure that the Director is not out of pocket by settling the related tax via the PSA. In line with current regulations, these taxable benefits have been disclosed and are shown in the BIK arising from performance of duties column.
The figures shown are the cost of the taxable benefit.
4. The 2021 fees for Lynda Clarizio relate to the period from 1 March 2021, the date she was appointed to the Board.
5. The fees shown for Jez Maiden relate to the period from 26 May 2022, the date he was appointed to the Board.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 94
Annual incentive (audited)
The annual incentive for 2022 was:
• 70% based on a matrix based on revenue and adjusted operating profit growth;
• 15% based on return on invested capital (‘ROIC’); and
• 15% based on a carbon emissions target.
Overview of the matrix (70% of the award)
Revenue performance (£m)
Maximum
Target
Threshold
Below threshold
Adjusted operating profit performance (£m)
Below threshold
Threshold
Target
Maximum
0%
0%
0%
0%
40%
30%
25%
0%
65%
50%
35%
0%
100%
75%
60%
0%
Straight-line payouts occur between each of the points above threshold noted above.
The Company’s performance resulted in a Group annual incentive payout of 20.58% of maximum opportunity. Performance of individual components is shown below.
2022 Company performance against annual incentive targets (at 2021 constant currency)
Financial measures
Total external revenue1
Adjusted operating profit1
Revenue/profit matrix
Return on invested capital4,6
Carbon emissions5,6,7,8
Total
%
Weighting
2022
Threshold
2022
Target2
2022
Maximum
2022
Actual
Achieved3
Weighted
achievement
£2,938.1m
£2,998.1m
£3,058.1m
£3,033.7m
£503.1m
£518.7m
£534.3m
£498.1m
18.6%
18.8%
19%
18.7%
258,117
253,056
247,995
207,032
70%
15%
15%
100%
0%
37.2%
100%
0%
5.58%
15%
20.58%
1. Total External revenue calculated using Lfl Revenue on constant 2021 exchange rates and Adjusted operating profit excludes certain non-budgeted non-recurring items and Separately Disclosed Items.
2. Target is equivalent to 50% payout.
3. Percentage achieved against maximum targets.
4. Return on invested capital as per definition used for the Group's KPIs in Book one, page 24.
5. Emissions are measured in tonnes of carbon dioxide equivalent (tCO2e).
6. Performance at threshold levels generates 25% outcome for both ROIC and carbon emissions.
7. Emissions from Fuel- and Energy-Related Activities not Included in Scope 1 or Scope 2 are excluded from incentive targets.
8. EY have issued an assurance statement in respect of carbon emissions disclosure that can be found on page 28.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 95
For 2022, the annual incentive outturn in cash and shares is as follows:
André Lacroix
Jonathan Timmis
1. These awards vest three years after the date of grant, subject to continued employment or good leaver status. The deferred award is based on 50% of the annual incentive outturn.
Vesting of LTIP Share Awards (audited)
The LTIP Share Awards granted in 2020 are subject to performance for the three-year period ended 31 December 2022.
The performance conditions attached to this award and actual performance against these conditions are as follows:
Payable in
cash
£’000
Deferred
Share Award1
£’000
Percentage
of Salary
%
207.4
110.2
207.4
110.2
20.58
20.58
Metric
Earnings Per Share (33.3%)
Adjusted Free Cash Flow (33.3%)
Return on Invested Capital (33.3%)
Total vesting
1. 25% of the LTIP share awards will vest at the threshold target and 100% will pay out at the stretch target.
Performance condition
Annualised fully diluted, adjusted EPS growth. Measured on a constant currency
basis.
Free cash flow generated from operations less net capital expenditure, net interest
paid and income tax paid. Adjusted for separately disclosed items. Measured on a
constant currency basis.
Adjusted operating profits less adjusted tax, divided by invested capital (net assets
excluding tax balances, net financial debt and net pension liabilities). Measured on a
constant currency basis.
Threshold
target1
Stretch
target1
Actual
performance Vesting level
4%
10%
1.4%
0%
£1,126m
£1,206m
£1,296m
100%
20%
24%
24.3%
100%
66.67%
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 96
The LTIP Share Awards granted in 2020 to the Executive Directors were as follows:
Executive Director
André Lacroix
Jonathan Timmis2
Total
Number of
shares at grant
44,900
n/a
44,900
Number of
shares based
on accrued
dividends
2,301
n/a
2,301
Total number of
shares
Number of
shares to lapse
Number of
shares to vest
Value of vested
shares
£’0001
47,201
15,733
31,468
n/a
n/a
n/a
47,201
15,733
31,468
1,225
n/a
1,225
1. The value of shares vested is calculated using the average mid-market share price in the fourth quarter of 2022 which was £38.94.
2 Appointed as a Director on 1 April 2021.
The Committee considered the LTIP outturns in the context of the underlying financial performance of the Group and determined it was appropriate not to exercise its discretion. There was no share appreciation on the shares
which vested below their award price.
LTIP Share Awards granted during the year (audited)
The following LTIP Share Awards were granted to the Executive Directors during 2022:
Executive Director
André Lacroix
Jonathan Timmis
Type of award
Date of award
Basis of award
granted
Award price
£
Number of
shares over
which award
was granted
Face value
of award
£’000
% of face value
that would vest
at threshold
performance
Vesting
determined by
performance
over
LTIP Share
Award 11 March 2022 300% of salary
48.762
60,794
2,964
LTIP Share
Award 11 March 2022 200% of salary
48.762
21,533
1,050
25% Three years to
31 December
2024
25%
The LTIP Share Awards granted in 2022 are conditional share awards subject to performance for the three-year period ending 31 December 2024. Shares are granted at the average of the mid-market quotation price for the
five days up to and including the day immediately before grant.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 97
The performance conditions attached to this award and the targets are as follows:
Metric
Earnings Per Share (33.3%)
Return on Invested Capital (33.3%)
Adjusted Free Cash Flow (33.3%)
Performance condition
Annualised fully diluted, adjusted EPS growth, calculated on a constant currency basis and per the EPS definition used for the
Group KPIs in the 2020 Annual Report & Accounts.
Adjusted operating profits less adjusted tax, divided by cumulative invested capital (being net assets excluding tax balances,
net financial debt and net pension liabilities) in each of the three years, measured on a constant currency basis.
Free cash flow generated from operations less net capital expenditure, net interest paid and income tax paid adjusted for
separately disclosed items and is measured on a constant currency basis. Cumulative targets measured over three years.
Threshold target Maximum target
4%
10%
16.5%
20.5%
£899m
£979m
Deferred Share Awards granted during the year (audited)
Executive Director
André Lacroix
Jonathan Timmis
1. Vesting date subject to continued employment or good leaver status.
Type of award
Date of award
Deferred Share
Award 11 March 2022
Deferred Share
Award 11 March 2022
Basis of award
granted
Award price
£
Number of
shares over
which award
was granted
Face value
of award
£’000
Vesting date1
Deferral of
2021 bonus
Deferral of
2021 bonus
48.762
17,225
840 11 March 2025
48.762
6,930
338 11 March 2025
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 98
Share Plan Awards (audited)
The table below shows the Directors’ interests in the Intertek Share Plans, all of which are restricted stock units (‘RSUs’):
André Lacroix
2019
2020
2021
2022
Total
Type of Award
31 December 2021
Number of shares
Granted in 2022
Number of shares
Award price1
£
Dividend accrued
in 20222
Vested in 2022
Number of shares
Lapsed in 2022
Number of shares
31 December 2022
Number of shares
Date of vesting
LTIP Share3,4
Dividend
Deferred Share3
Dividend
LTIP Share5,6
Dividend
Deferred Share7
Dividend
LTIP Share6,8
Dividend
LTIP Share6,9
Dividend
LTIP Share6,10
Dividend
Deferred Share10
Dividend
50,117
2,909
15,135
876
44,900
1,143
10,532
408
46,296
920
8,471
168
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
60,794
–
17,225
–
47.378
–
47.378
–
53.94
–
48.126
–
53.36
–
58.324
–
48.762
–
48.762
–
181,875
78,019
–
–
–
–
–
1,158
–
271
–
1,193
–
218
–
1,567
–
443
4,850
–
–
(15,135)
(876)
–
–
–
–
–
–
–
–
–
–
–
–
(50,117)
(2,909)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
44,900
2,301
10,532
679
46,296
2,113
8,471
386
60,794
1,567
17,225
443
Mar 2022
Mar 2022
May 2023
Mar 2023
Mar 2024
May 2024
Mar 2025
Mar 2025
(16,011)
(53,026)
195,707
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 99
Type of Award
31 December 2021
Number of shares
Granted in 2022
Number of shares
Award price1
£
Dividend accrued
in 20222
Vested in 2022
Number of shares
Lapsed in 2022
Number of shares
31 December 2022
Number of shares
Date of vesting
Jonathan Timmis
(appointed as a Director on 1 April 2021)
2021
2021
2021
2021
2022
Total
Buyout award11
Dividend
Buyout award12
Dividend
Buyout award13
Dividend
LTIP Share14
Dividend
LTIP Share6,10
Dividend
Deferred Share10
Dividend
13,000
258
13,000
258
13,000
258
18,713
371
–
–
–
–
58,858
–
–
–
–
–
–
–
–
21,533
–
6,930
–
28,463
56.108
–
56.108
–
56.108
–
56.108
–
48.762
–
48.762
–
–
–
–
335
–
335
–
482
–
555
–
178
(13,000)
(258)
–
–
–
–
–
–
–
–
–
–
1,885
(13,258)
–
–
–
–
–
–
–
–
–
–
–
–
April 2022
April 2023
April 2024
April 2024
Mar 2025
Mar 2025
–
–
13,000
593
13,000
593
18,713
853
21,533
555
6,930
178
75,948
1. Awards made are based on a share price obtained by averaging the closing share prices for the five dealing days before the date of grant.
2. The dividend shares are accrued on the date the dividend is paid and determined using the closing market price of the shares on that date. The dividend accruals relate to Share Awards made in lieu of not receiving cash dividends during the vesting period.
3. Awards vested on 21 March 2022, on which date the closing market price of shares was £51.70 having been granted on 21 March 2019 on which date the closing market price was £47.70. Awards were made at a share price of £47.38 being the share price obtained by averaging the closing
share prices for the five dealing days before the date of grant.
4. One-third of the LTIP Share Awards are subject to EPS, one-third on Return on Invested Capital and one-third on Adjusted Free Cash Flow. In 2022, no LTIP shares vested.
5. Awards will vest on 29 May 2023, subject to continued employment or good leaver status, having been granted on 29 May 2020, on which date the closing market price was £55.06. Awards were made at a share price of £53.94 being the share price obtained by averaging the closing share
prices for the five dealing days before the date of grant.
6. One-third of the LTIP Share Awards are subject to EPS, one-third on Return on Invested Capital and one-third on Adjusted Free Cash Flow. The LTIP shares will be subject to an additional two-year holding period post-vesting.
7. Awards will vest on 13 March 2023, subject to continued employment or good leaver status, having been granted on 13 March 2020, on which date the closing market price was £45.36. Awards were made on a share price of £48.126 being the share price obtained by averaging the closing
share prices for the five dealing days before the date of grant.
8. Awards will vest on 12 March 2024, subject to continued employment or good leaver status, having been granted on 12 March 2021, on which date the closing market price was £53.06. Awards were made at a share price of £53.36 being the share price obtained by averaging the closing share
prices for the five dealing days before the date of grant.
9. Awards will vest on 27 May 2024, subject to continued employment or good leaver status, having been granted on 27 May 2021 on which date the closing market price was £54.82. Awards were made at a share price of £58.324 being the share price obtained by averaging the closing share
prices for the five dealing days before the date of grant.
10. Awards will vest on 11 March 2025, subject to continued employment or good leaver status, having been granted on 11 March 2022 on which date the closing market price was £48.56. Awards were made at a share price of £48.762 being the share price obtained by averaging the closing
share prices for the five dealing days before the date of grant.
11. Awards vested on 1 April 2022, on which date the closing market price of shares was £52.14 having been granted on 1 April 2021 on which date the closing market price was £57.20. Awards were made at a share price of £56.108 being the share price obtained by averaging the closing share
prices for the five dealing days before the date of grant.
12. Awards will vest on 1 April 2023, subject to continued employment or good leaver status, having been granted on 1 April 2021 on which date the closing market price was £57.20. Awards were made at a share price of £56.108, being the share price obtained by averaging the closing share
prices for the five dealing days before the date of grant.
13. Awards will vest on 1 April 2024, subject to continued employment or good leaver status, having been granted on 1 April 2021 on which date the closing market price was £57.20. Awards were made at a share price of £56.108, being the share price obtained by averaging the closing share
prices for the five dealing days before the date of grant.
14. Awards will vest on 1 April 2024, subject to continued employment or good leaver status, having been granted on 1 April 2021 on which date the closing market price was £57.20. Awards were made at a share price of £56.108, being the share price obtained by averaging the closing share
prices for the five dealing days before the date of grant. One-third of the LTIP Share Awards are subject to EPS, one-third on Return on Invested Capital and one-third on Adjusted Free Cash Flow. The LTIP shares will be subject to an additional two-year holding period post-vesting.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 100
Malus and clawback (audited)
Malus and clawback will operate, in respect of the 2011 Long Term Incentive Plan and the 2021 Long Term Incentive Plan, in various circumstances including where there is reasonable evidence of misbehaviour or material
error, conduct considered gross misconduct, breach of any restrictive covenants by participants, conduct which resulted in (a) significant loss(es) to the Company, failure to meet appropriate standards of fitness and propriety,
a material failure of management in the Company, a discovery of a material misstatement in the audited consolidated accounts or the behaviour of a Director has a significant detrimental impact on the reputation of the Group.
Clawback can be applied at any time during the clawback period, which is six years from the date of the award unless extended by the Remuneration Committee prior to the expiry of the initial clawback period.
The Committee has the discretion to reduce annual incentive payments if it believes that short-term performance has been achieved at the expense of the Group’s long-term future or vice versa. The Committee also retains
the discretion to reduce or reclaim payments if the performance achievements are subsequently found to have been significantly misstated.
Directors’ interests in ordinary shares (audited)
The interests of the Directors in the shares of the Company as at the year-end, or date of ceasing to be a Director, are set out below. Save as stated in this report, during the course of the year, no Director or any member of his
or her immediate family have any other interest in the ordinary share capital of the Company or any of its subsidiaries. None of the Non-Executive Directors have share options or share awards.
André Lacroix5
Jonathan Timmis6
Andrew Martin
Graham Allan
Gurnek Bains
Lynda Clarizio
Tamara Ingram
Jez Maiden7
Kawal Preet8
Gill Rider
Jean-Michel Valette
Beneficially
owned at
31 December
2021
Beneficially
owned at
31 December
2022 or on
ceasing to be a
Director1
Outstanding
LTIP Share
Awards2
Outstanding
Deferred
Shares3
Shareholding as
a % of salary4
Shareholding
Guideline met
463,940
472,425
166,828
548
7,811
460
462
108
105
–
–
863
7,574
8,165
2,574
572
221
215
250
–
977
10,479
10,589
41,654
–
–
–
–
–
–
–
–
–
28,879
34,294
–
–
–
–
–
–
–
–
–
1,891
57
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
Yes
No
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
1. No changes in the above Directors’ interests have taken place between 31 December 2022 and 27 February 2023.
2. Subject to performance conditions.
3. Subject to continued employment or good leaver status.
4. Calculated as the number of shares beneficially owned at 31 December 2022 based on a share price of £40.34 as at 30 December 2022, being the last trading day, and applied to the annual salary for 2022.
5. Appointed 16 May 2015 with the guideline to hold 200% of base salary in shares by 16 May 2020. With effect from the AGM held on 26 May 2021, this was increased to 500% of base salary, which has been exceeded.
6. Appointed 1 April 2021 with a guideline to hold 200% of base salary in shares by 1 April 2026. This was increased to 300% of base salary with effect from the AGM held on 26 May 2021.
7. Appointed 26 May 2022.
8. Appointed 31 December 2022.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 101
Post-employment share ownership requirements
In line with best practice on the post-cessation of employment shareholding guidelines, Executive Directors are required to retain shares equivalent to the lower of their actual shareholding and in-employment shareholding
requirement for two years after ceasing employment with Intertek. These will be held in the Company Nominee account with the date that the holding restriction falls away annotated on the account.
Payments to past Directors (audited)
Edward Leigh received 5,088 shares on 21 March 2022 which vested at a share price of £51.53. This relates to the 2019 LTIP award, where Edward was treated as a good leaver. These vested in line with the LTIP awards
vesting for other Executives in respect of the performance period ending on 31 December 2021 (0%) of maximum with only the deferred shares vesting.
Ross McCluskey continues to be employed by the Group, as Executive Vice President Europe and Central Asia, and therefore was not treated as a leaver for the purpose of outstanding incentive awards on ceasing to be
a Director.
Payments for loss of office (audited)
No payments for loss of office were made in the year.
Percentage change in remuneration levels
The table below shows the average movement in salary and annual incentive for UK employees between the 2019 and 2020, the 2020 and 2021, and the 2021 and 2022 financial year-ends. The UK total employee population
has been chosen as a comparator, as the parent company (Intertek Group plc) does not have any employees apart from the Directors.
CEO (André Lacroix1)
CFO (from 1 April 2021) (Jonathan Timmis2)
Average based on Intertek’s UK employees3
Chairman (from 1 Jan 2021) (Andrew Martin)
Graham Allan
Gurnek Bains
Lynda Clarizio (from 1 March 2021)
Tamara Ingram (from 18 Dec 2020)
Jez Maiden (from 26 May 2022)
Kawal Preet (from 31 December 2022)
Gill Rider
Jean-Michel Valette
Salary %
Annual Incentive %
Benefits%
2019/2020
2020/2021
2021/2022
2019/2020
2020/2021
2021/2022
2019/2020
2020/2021
2021/2022
1.0
n/a
3.2
–
–
–
n/a
n/a
n/a
n/a
–
–
1.44
–
280.43
–
–
–
32.5
n/a
n/a
11.69
13.89
1.5
33.9
4.1
–
–
–
23.1
11.8
n/a
n/a
1.2
–
(24.2)
n/a
(9.9)
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a3
–
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
(75.3)
(67.4)
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
(12.4)
n/a
16.45
n/a
–
(100)
n/a
n/a
n/a
n/a
(63.5)
(48.9)
(2.31)
–
14.4
–
–
–
–
–
n/a
n/a
n/a
(25)
8.2
21.9
5
n/a
n/a
n/a
350
n/a
n/a
n/a
(100)
180
1. The percentage change for incentive and benefits for André Lacroix are based on actual amounts earned from 2019, 2020, 2021 and 2022. The overnight increase in April 2022 was 2%.
2. The increases for Jonathan Timmis are also based on actual amounts earned. Their size reflects a comparison of 2022 full-year against 2021 part-year. His overnight salary increase in April 2022 was 2%.
3. The Intertek UK employee group has been selected as the most appropriate comparator group, due to the diverse nature of the Group’s global employee population.
Non-Executive Director fees are set in advance for all Non-Executive Directors and any changes in salary percentages reflect that one comparator year was not a full year, or the Non-Executive Director changed Committee roles and there was an adjustment to their fees to reflect this, or a general
increase in fees which would be reflected in the table on page 93. Any changes in the Benefits% column would reflect the benefits in kind occurred in the performance of their duties (e.g. expenses for accommodation, travel or meals) – whether there is a claim depends on where the meetings are
held in relation to where the Director's place of work is considered to be or where n/a is shown this indicates no payment was received in either period or that the increase cannot be calculated as there was no payment in the preceding period.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 103
CEO total remuneration
The total remuneration figures for the CEO during each of the past ten financial years are shown in the table below. Consistent with the calculation methodology for the single figure for total remuneration, the total
remuneration figure includes the total annual incentive and Deferred Share Award based on that year’s performance and LTIP share awards based on the three-year performance period ending in the relevant year. The annual
incentive payout and LTIP award vesting level as a percentage of the maximum opportunity are also shown for each of these years.
Total remuneration £’000
Annual incentive (%)
LTIP award vesting (%)
W Hauser
A Lacroix
2013
2014
3,195
2,011
34.6
81.8
38.4
25.2
2015
876
90.6
–
2015
2016
2017
2018
2019
2020
2021
2022
1,824
5,4521
11,4171
6,223
4,986
2,470
3,048
2,986
96.6
70.2
–
–
100.0
90.87
75.5
52.3
0.0
98.32
89.40
41.50
85.0
0.0
20.6
66.7
1. As reported in previous years, at the time of joining, the Company had bought out André’s existing share awards with his previous employer in two tranches of 91,575 and 91,574 shares vesting in 2016 and 2017, each at an award price of £28. The tranche that vested in 2017 vested at a
share price of £42.95, which represents an increase in our Company share price over the two years of over 53%. These awards were one-off awards and not part of his ongoing remuneration.
The graph below shows the total remuneration of the Intertek CEO over the ten-year period from 2013 to 2022.
£’000
12,000
10,000
8,000
6,000
4,000
2,000
0
Mirror awards
LTIP (share price increase)4
LTIP (award share price)3
Annual incentive
Pension
Benefits
Salary
2013
2014
2015 (WH)1
2015 (AL)2
2016
2017
2018
2019
2020
2021
2022
1. Shows W Hauser remuneration based on period to 15 May 2015.
2. Shows A Lacroix remuneration for the period from appointment as CEO on 16 May 2015.
3. LTIP (award share price) shows the proportion of the LTIP value received which resulted from the share price on the award date.
4. LTIP (share price increase) shows the proportion of the LTIP value received which resulted from increase in the share price over the vesting period.
Approval of the Directors’ Remuneration report
The Directors’ Remuneration report, including both the Directors’ Remuneration Policy review report and the Annual report on remuneration, was approved by the Board on 27 February 2023.
Gill Rider
Chair of the
Remuneration Committee
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeRemuneration Committee report ContinuedContents 104
For the purposes of LR 9.8.4C R, the information required to be disclosed by LR 9.8.4 R can be found in the
table below.
Topic
1. Amount of interest capitalised
Location and page
Not applicable
2. Any information required by LR 9.2.18 R (Publication of unaudited
Not applicable
financial information)
3. Details of long-term incentive schemes
4. Waiver of emoluments by a Director
5. Waiver of future emoluments by a Director
6. Non pre-emptive issues of equity for cash
7.
Information required by (6) above for any unlisted major subsidiary
undertaking of the Company
Directors’ Remuneration Committee
report (pages 78 to 103)
Not applicable
Not applicable
Not applicable
Not applicable
8. Company participation in a placing by a listed subsidiary
Not applicable
9. Any contracts of significance
Other statutory information
(page 105)
10. Any contracts for the provision of services by a controlling
Not applicable
shareholder
11. Shareholder waivers of dividends
12. Shareholder waivers of future dividends
Other statutory information
(page 105)
Other statutory information
(page 105)
13. Agreements with controlling shareholders
Not applicable
Other statutory information
In accordance with the requirements of the
Companies Act 2006 (‘Act’) and the Disclosure
Guidance and Transparency Rules (‘DTR’) of the
Financial Conduct Authority (‘FCA’), the following
section describes the matters that are required for
inclusion in the Directors’ Report and were approved
by the Board. Further details of matters required
to be included in the Directors’ Report that are
incorporated by reference into this report are set
out below.
Annual Report & Accounts and compliance
with Listing Rule (‘LR’) 9.8.4 R
The Annual Report & Accounts is in a three book
format: Book one – Strategic report; Book two –
Sustainability report/Directors' report; and Book
three – Financial report. The Board has prepared
a Strategic report in Book one which provides an
overview of the development and performance of
the Company’s business together with any research
and development activities during the year ended
31 December 2022 and its position at the end of
that year. The Strategic report also outlines any
important events since the end of the financial year
and also likely future developments in the business
of the Company and Group.
For the purposes of compliance with DTR 4.1.5 R (2)
and DTR 4.1.8 R, the required content of the
management report can be found in the Strategic
report and this Directors’ report in Book two,
including the sections of the Annual Report &
Accounts, being Books one, two and three,
incorporated by reference.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 105
Other statutory information Continued
Directors
The names of the members of the Board, as at
the date of this report, and their biographical
details are set out on pages 40 to 42. During the
year, Jez Maiden and Kawal Preet were appointed
as Non-Executive Directors of the Board on
26 May 2022 and 31 December 2022, respectively.
Articles of Association
The Company’s Articles of Association contain
provisions relating to the retirement, election and
re-election of Directors but, in accordance with best
practice, all Directors who wish to continue to serve
will stand for election and re-election at the Annual
General Meeting (‘AGM’).
The Articles of Association set out the internal
regulation of the Company and cover such matters
as the rights of shareholders, the appointment or
removal of Directors and the conduct of the Board and
general meetings. Copies are available upon request
from the Group Company Secretary and are available
at the Company’s AGM. Further powers are granted by
members in general meetings and those currently in
place are set out in detail on the next page.
Directors’ indemnities
The Board believes that it is in the best interests of
the Group to attract and retain the services of the
most able and experienced Directors by offering
competitive terms of engagement, including the
granting of indemnities on terms consistent with
the applicable statutory provisions. In accordance
with the Articles of Association, the Company has
executed deed polls of indemnity for the benefit
of the Directors of the Company.
These provisions, which are deemed to be qualifying
third-party indemnity provisions (as defined by
section 234 of the Act), were in force during the
financial year ended 31 December 2022, for the
benefit of the Directors and, at the date of this
report, remain in force in relation to certain losses
and liabilities which they may incur (or have incurred)
in connection with their duties, powers or office.
Directors’ interests
Other than the Directors’ service agreements or
letters of appointment, none of the Directors of the
Company had a personal interest in any business
transactions of the Company or its subsidiaries. The
terms of the Directors’ service agreements or letters
of appointment and the Directors’ interests in shares
and share awards of the Company, in respect of
which transactions are notifiable to the Company
and the FCA under Article 19 of the UK Market
Abuse Regulation, are disclosed in the Directors’
Remuneration Committee report.
Directors’ powers
The Directors are responsible for the strategic
management of the Company and their powers to
do so are determined by the provisions of the Act
and the Company’s Articles of Association.
Dividend
The Directors are recommending a final dividend
of 71.6p per ordinary share (2021: 71.6p) making
a full-year dividend of 105.8p per ordinary share
(2021: 105.8p) which will, if approved at the AGM,
be paid on 15 June 2023 to shareholders on the
register at the close of business on 26 May 2023.
Share capital
The issued share capital of the Company and the
details of the movements in the Company’s share
capital during the year are shown in note 15 in
Book three.
The holders of ordinary shares are entitled to receive
dividends when declared, receive the Company’s
Annual Report & Accounts, attend and speak at
general meetings of the Company, appoint proxies
and exercise voting rights. A waiver of dividend
exists in respect of the 132,407 shares held by the
Intertek Group Employee Share Ownership Trust
(‘Trust’) as of 31 December 2022 and with respect to
future dividends. Details of the shares purchased by
the Trust during the year are outlined in note 15 in
Book three. There are no restrictions on the transfer
of ordinary shares in the Company.
The rights attached to shares in the Company are
provided by the Articles of Association, which may be
amended or replaced by means of a special resolution
of the Company in a general meeting. The Directors’
powers are conferred on them by UK legislation and
by the Company’s Articles of Association.
No ordinary shares carry any special rights with
regard to the control of the Company and there
are no restrictions on voting rights except that a
shareholder has no right to vote in respect of a
share unless all sums due in respect of that share
are fully paid. There are no arrangements known
to the Company by which financial rights carried
by any shares in the Company are held by a person
other than the holder of the shares, nor are there
any arrangements between holders of securities
that may result in restrictions on the transfer of
securities or on voting rights known to the
Company. All issued shares are fully paid.
Shares are admitted to trading on the London
Stock Exchange and may be traded through the
CREST system.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Other statutory information Continued
Allotment of shares
At the AGM held in 2022, the shareholders generally
and unconditionally authorised the Directors to allot
relevant securities up to approximately two-thirds of
the nominal amount of issued share capital.
It is the Directors’ intention to seek renewal of
this authority in line with guidance issued by the
Investment Association. The resolution will be
set out in the Notice of AGM.
At the AGM held in 2022, the Directors were also
empowered by the shareholders to allot equity
securities, up to 5% of the Company’s issued share
capital, for cash under section 570 of the Act. It is
intended that this authority be renewed at the
forthcoming AGM.
It is the Board’s intention to also propose the
renewal of the additional special resolution to allow
the Company to allot equity securities up to a further
5% of the Company’s issued share capital. This is
applicable when the Board determines a transaction
to be an acquisition or other capital investment and is
announced contemporaneously with the allotment or
has taken place in the preceding six-month period and
is disclosed in the announcement of the allotment.
106
Purchase of own shares
Shareholders also approved the authority for the
Company to buy back up to 10% of its own ordinary
shares by market purchase until the conclusion of the
AGM to be held this year. The Directors will seek to
renew this authority for up to 10% of the Company’s
issued share capital at the forthcoming AGM. This
power will only be exercised if the Directors are
satisfied that any purchase will increase the earnings
per share of the ordinary share capital in issue after
the purchase, and accordingly, that the purchase is in
the interests of shareholders. The Directors will also
give careful consideration to gearing levels of the
Company and its general financial position. Any
shares purchased in this way may be held in treasury
which, the Directors believe, will provide the
Company with flexibility in the management of its
share capital. Where treasury shares are used to
satisfy Share Awards, they will be classed as new
issue shares for the purpose of the 10% limit on the
number of shares that may be issued over a ten-year
period under the relevant share plan rules. The
Company currently holds no shares in treasury.
Significant agreements
The Company is not a party to significant agreements
which take effect, alter or terminate upon a change
of control following a takeover bid apart from a
number of credit facilities with banks together with
certain senior notes issued by the Company. The
total amount owing under such credit facilities and
senior note agreements as of 31 December 2022 is
shown in note 14 to the financial statements. These
agreements contain clauses such that, in the event
of a change of control, the Company can offer to
or must repay all such borrowings together with
accrued interest, fees and other sums owing as
required by the individual agreements.
The rules of the Company’s incentive plans contain
clauses relating to a change of control resulting
from a takeover and, in such an event, awards would
vest subject to the satisfaction of any associated
performance criteria. The Company is not aware
of any other agreements with change of control
provisions that are considered to be significant in
terms of their potential impact to the business.
There are no significant agreements or contracts in
place with any Group Company and a Director of the
Company or a major shareholder.
Material interests in shares
Up to 27 February 2023, being the latest practicable
date before the publication of this report, the
following disclosures of major holdings of voting
rights have been made (and have not been amended
or withdrawn) to the Company pursuant to the
requirements of Rule 5 of the DTR of the FCA (‘DTR
5’). The Company is not aware of any changes in the
interests disclosed under DTR 5 since the year-end.
At date of notification
Shareholder
BlackRock Inc.
Fiera Capital Corporation
Massachusetts Financial Services Company
Direct voting
rights
Indirect voting
rights
Percentage of
voting rights
attached to
shares
Voting rights
through
financial
instruments
Percentage of
voting rights
through
financial
instruments
Total voting
rights
Percentage of
total voting
rights
–
–
–
10,473,019
6.49%
1,392,394
0.85%
11,865,413
9,553,525
8,004,731
5.92%
4.96%
–
–
–
–
9,553,525
8,004,731
7.34%
5.92%
4.96%
These holdings are published on a Regulatory Information Service and on the Company’s website.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 107
Annual General Meeting
The Notice of AGM, which is to be held on 24 May
2023, is available for download from the Company’s
website at intertek.com/investors. The Notice details
the business to be conducted at the meeting and
includes information concerning the deadlines for
submitting proxy forms and in relation to voting rights.
Statement of disclosure of information
to auditors
The Directors who held office at the date of approval
of this Directors’ Report confirm that, so far as they
are aware, there is no relevant audit information of
which the Company’s auditors are unaware and each
Director has taken all reasonable steps that he or she
ought to have taken as a Director of the Company
to make themselves aware of any relevant audit
information and to establish and ensure that the
Company’s auditors are aware of that information.
Other statutory information Continued
Our people
Information about the Group’s employees,
employment of disabled persons policies and
employment practices is contained within this report
on pages 10 to 15. Information on the employee share
schemes is in the Directors’ Remuneration Committee
report and in Book three, page 36. The steps by the
Company taken to inform, engage and consult with
employees is outlined in pages 53 to 61 and in the
Section 172 statement in Book one.
Stakeholders
Information on the steps by the Company taken to
inform, engage and consult with our stakeholders is
outlined in pages 52 to 61 and in the Section 172
statement in Book one.
Energy Use and Greenhouse Gas emissions
(‘GHG’)
Information about the Group’s energy use, GHGs and
methodologies used for the calculations are given in
this report on pages 24 to 29.
Task Force on Climate-Related Financial
Disclosures ('TCFD')
The climate-related financial disclosures consistent
with TCFD recommendations are in Book one.
Political donations
At the AGM in 2022, shareholders passed an
ordinary resolution, on a precautionary basis, to
authorise the Company to make donations to EU
political organisations and to incur EU political
expenditure (as such items are defined in the Act)
not exceeding £90,000.
During the year the Group did not make any such
political donations (2021: £nil). It is the Company’s
policy not, directly or through any subsidiary, to make
what are commonly regarded as donations to any
political party.
At the forthcoming AGM of the Company,
shareholders’ approval will again be sought to
authorise the Group to make political donations
and/or incur political expenditure (as such terms are
defined in section 362 to 379 of the Act). Further
information is contained in the Notice of AGM.
Branches
The Company, through various subsidiaries, has
established branches in a number of different
countries in which the business operates. The list
of related undertakings is available in note 23 in
Book three.
Independent auditors
The auditor, PricewaterhouseCoopers LLP, have
expressed their willingness to continue in office.
Upon the recommendation of the Audit Committee,
a resolution to reappoint them as auditors and to
determine their remuneration will be proposed at
the forthcoming AGM.
Financial instruments
Details about the Group’s use of financial
instruments are outlined in note 14 in Book three.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 108
In the case of each Director in office at the date
the Directors’ Report is approved:
• so far as the Director is aware, there is no
relevant audit information of which the Group’s
and Company’s auditors are unaware; and
• they have taken all the steps that they ought
to have taken as a Director in order to make
themselves aware of any relevant audit
information and to establish that the Group’s and
Company’s auditors are aware of that information.
André Lacroix
Chief Executive Officer
27 February 2023
Registered Office:
33 Cavendish Square, London W1G 0PS
Registered Number: 04267576
Statement of Directors’ responsibilities
in respect of the financial statements
The Directors are responsible for preparing the Annual
Report & Accounts and the financial statements in
accordance with applicable law and regulation.
Company law requires the Directors to prepare
financial statements for each financial year. Under
that law the Directors have prepared the Group
financial statements in accordance with UK-adopted
international accounting standards and the Company
financial statements in accordance with United
Kingdom Generally Accepted Accounting Practice
(United Kingdom Accounting Standards, comprising
FRS 101 'Reduced Disclosure Framework', and
applicable law).
The Directors are also responsible for keeping
adequate accounting records that are sufficient
to show and explain the Group’s and Company’s
transactions and disclose with reasonable accuracy
at any time the financial position of the Group and
Company and enable them to ensure that the
financial statements and the Directors’ Remuneration
report comply with the Companies Act 2006.
The Directors are responsible for the maintenance
and integrity of the Company’s website. Legislation
in the United Kingdom governing the preparation
and dissemination of financial statements may differ
from legislation in other jurisdictions.
Under company law, Directors must not approve the
financial statements unless they are satisfied that
they give a true and fair view of the state of affairs
of the Group and Company and of the profit or loss
of the Group for that period. In preparing the financial
statements, the Directors are required to:
• select suitable accounting policies and then apply
Directors’ confirmations
The Directors consider that the Annual Report
& Accounts, taken as a whole, is fair, balanced
and understandable and provides the information
necessary for shareholders to assess the Group’s
and Company’s position and performance, business
model and strategy.
them consistently;
• state whether applicable UK-adopted international
accounting standards have been followed for the
Group financial statements and United Kingdom
Accounting Standards, comprising FRS 101, have
been followed for the Company financial
statements, subject to any material departures
disclosed and explained in the financial statements;
• make judgements and accounting estimates that
are reasonable and prudent; and
• prepare the financial statements on the going
concern basis unless it is inappropriate to presume
that the Group and Company will continue in
business.
The Directors are responsible for safeguarding the
assets of the Group and Company and hence for
taking reasonable steps for the prevention and
detection of fraud and other irregularities.
Each of the Directors, whose names and functions
are listed in the Directors’ Report, confirm that, to
the best of their knowledge:
• the Group financial statements, which have
been prepared in accordance with UK-adopted
international accounting standards, give a true
and fair view of the assets, liabilities, financial
position and profit of the Group;
• the Company financial statements, which have
been prepared in accordance with United Kingdom
Accounting Standards, comprising FRS 101, give
a true and fair view of the assets, liabilities and
financial position of the Company; and
• the Strategic Report includes a fair review of the
development and performance of the business
and the position of the Group and Company,
together with a description of the principal risks
and uncertainties that it faces.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents This report has been printed on material which is
certified by the Forest Stewardship Council®. The
paper is made at a mill with ISO 14001 Environmental
Management System accreditation. Printed using
vegetable oil based inks, the printer is also certified
to ISO 14001 Environmental management system
and FSC® certified.
Intertek Group plc
33 Cavendish Square,
London, W1G 0PS
United Kingdom
Tel +44 20 7396 3400
info@intertek.com
intertek.com
B
o
o
k
t
h
r
e
e
financial
report
The Financial Report comprises
the Group consolidated Financial
Statements and the Company
Financial Statements.
We are pleased to share with
you our Annual Report & Accounts
in a unique, three-book format:
Book one – Strategic Report
Book two – Sustainability Report
Book three – Financial Report
These separate, but connected books,
with their interconnected themes and
narratives, allow us to present what
we achieved in 2022 in a systemic,
end-to-end architecture.
They have been designed to make it easier
for our stakeholders to fully understand our
business, how we bring quality and safety
to life, what we offer our clients and society,
and the opportunities we have ahead of us.
The three books, which allow us to
present our work in 2022 to you through
the three important lenses of growth
opportunities, sustainability goals and
financial performance, should be read
together to form our Annual Report &
Accounts 2022.
Look out for these throughout the report:
Reference to another page in the
report or to an external web page
Intertek Sustainability Disclosure Index
Online Review 2022
Strategic Report
Sustainability Report
Financial Report
this report
Where we discuss our growth
opportunities and strategic
performance.
Where we discuss our
environmental, social and
governance progress.
Where we record our
financial activities,
performance and position.
5 Chief Executive Officer’s letter
1
Chief Executive Officer’s
1 Consolidated income statement
10 Our 5x5 strategy
14 Our business model
15 Who we are
16 What we do
18 Our sectors
19 How we do it
21 The value we create
24 Key performance indicators
28 Financial review
34 Operating review
34 Products
38 Trade
40 Resources
Sustainability letter
5
Our Sustainability Approach
10 Sustainability performance
2
Consolidated statement
of comprehensive income
3
Consolidated statement
33 Responsible Business Practices
of financial position
36 Directors’ Report
38 Chairman’s introduction
40 Board of Directors
43 Direct reports to the CEO
44 Board Leadership and
Company Purpose
63 Division of Responsibilities
65 Composition, Succession
and Evaluation
4
Consolidated statement
of changes in equity
6 Consolidated statement of cash flows
7 Notes to the financial statements
49 Intertek Group plc –
Company balance sheet
50 Intertek Group plc –
Company statement of changes in equity
51 Notes to the Company
financial statements
43 Principal risks and uncertainties
67 Nomination Committee report
49 TCFD statement
58 Section 172 statement
71 Audit Committee report
54 Independent Auditors’ Report
78 Remuneration Committee report
61 Glossary –
64 Group non-financial information
104 Other statutory information
Alternative performance measures
statement
108 Statement of Directors’
64 Shareholders and corporate information
responsibilities
Visit our website for more information
intertek.com
Book one
Book two
Book three
Contents
Consolidated income statement
1
For the year ended 31 December
Revenue
Operating costs
Group operating profit/(loss)
Finance income
Finance expense
Net financing (costs)/income
Profit/(loss) before income tax
Income tax (expense)/credit
Profit/(loss) for the year
Attributable to:
Equity holders of the Company
Non-controlling interest
Profit/(loss) for the year
Earnings per share**
Basic
Diluted
See note 3.
*
** Earnings per share on the adjusted results is disclosed in note 7.
Notes
2
4
2
14
14
6
2
20
7
7
Separately
Disclosed
Items*
£m
Total
2022
£m
Adjusted
results*
£m
Separately
Disclosed
Items*
£m
Adjusted
results*
£m
3,192.9
(2,672.8)
520.1
2.2
(34.1)
(31.9)
–
(67.7)
(67.7)
–
(0.7)
(0.7)
3,192.9
(2,740.5)
2,786.3
(2,312.4)
452.4
473.9
2.2
(34.8)
(32.6)
1.5
(29.9)
(28.4)
488.2
(68.4)
419.8
445.5
(128.4)
15.4
(113.0)
(118.0)
359.8
(53.0)
306.8
327.5
341.8
18.0
359.8
(53.0)
–
(53.0)
288.8
18.0
306.8
308.9
18.6
327.5
179.2p
178.4p
–
(40.7)
(40.7)
–
8.6
8.6
(32.1)
11.3
(20.8)
(20.8)
–
(20.8)
Total
2021
£m
2,786.3
(2,353.1)
433.2
1.5
(21.3)
(19.8)
413.4
(106.7)
306.7
288.1
18.6
306.7
178.7p
177.9p
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Consolidated statement of comprehensive income
2
For the year ended 31 December
Profit for the year
Other comprehensive income/(expense)
Remeasurements on defined benefit pension schemes
Tax on comprehensive income items
Items that will never be reclassified to profit or loss
Foreign exchange translation differences of foreign operations
Net exchange (loss)/gain on hedges of net investments in foreign operations
Items that are or may be reclassified subsequently to profit or loss
Total other comprehensive income/(expense) for the year
Total comprehensive income for the year
Total comprehensive income for the year attributable to:
Equity holders of the Company
Non-controlling interest
Total comprehensive income for the year
Notes
2022
£m
2021
£m
2
306.8
306.7
16
6
17.4
(4.3)
13.1
181.5
(120.0)
61.5
74.6
11.5
(0.5)
11.0
(24.7)
4.0
(20.7)
(9.7)
381.4
297.0
20
363.1
18.3
381.4
277.4
19.6
297.0
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 3
As at 31 December
Equity
Share capital
Share premium
Other reserves
Retained earnings
Notes
15
Total equity attributable to equity holders of the Company
Non-controlling interest
20
Total equity
2022
£m
2021
£m
1.6
257.8
(41.3)
1,065.9
1,284.0
34.0
1.6
257.8
(102.5)
925.1
1,082.0
32.3
1,318.0
1,114.3
* Working capital of negative £47.8m (2021: negative £43.3m) comprises the asterisked items in the above statement of financial position
less refundable deposits aged over 12 months of £nil (2021: £6.7m) and IFRS 16 Lease Receivable of £2.9m (2021: £nil).
The financial statements on pages 1 to 48 were approved by the Board on 27 February 2023 and were signed
on its behalf by:
André Lacroix
Chief Executive Officer
Jonathan Timmis
Chief Financial Officer
Consolidated statement of financial position
As at 31 December
Assets
Property, plant and equipment
Goodwill
Other intangible assets
Trade and other receivables
Defined benefit pension asset
Deferred tax assets
Total non-current assets
Inventories*
Trade and other receivables*
Cash and cash equivalents
Current tax receivable
Total current assets
Total assets
Liabilities
Interest-bearing loans and borrowings
Current taxes payable
Lease liabilities
Trade and other payables*
Provisions*
Total current liabilities
Interest-bearing loans and borrowings
Lease liabilities
Deferred tax liabilities
Defined benefit pension liabilities
Trade and other payables*
Provisions*
Total non-current liabilities
Total liabilities
Net assets
Notes
2022
£m
2021
£m
8
9
9
11
16
6
11
14
14
14
12
13
14
14
6
16
12
13
694.4
1,418.4
362.9
21.5
21.3
45.0
641.8
1,241.4
358.5
–
5.4
39.3
2,563.5
2,286.4
16.9
726.4
321.6
31.9
1,096.8
14.9
661.9
265.9
20.6
963.3
3,660.3
3,249.7
(262.4)
(71.0)
(70.6)
(723.2)
(15.8)
(462.0)
(59.1)
(63.5)
(667.8)
(13.2)
(1,143.0)
(1,265.6)
(797.1)
(251.6)
(99.2)
(2.2)
(34.6)
(14.6)
(537.2)
(228.8)
(67.4)
(4.0)
(31.9)
(0.5)
(1,199.3)
(869.8)
(2,342.3)
(2,135.4)
1,318.0
1,114.3
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Consolidated statement of changes in equity
4
For the year ended 31 December
At 1 January 2021
Total comprehensive (expense)/income for the year
Profit
Other comprehensive (expense)/income
Total comprehensive (expense)/income for the year
Transactions with owners of the Company recognised directly in equity
Contributions by and distributions to the owners of the Company
Dividends paid
Adjustment arising from changes in non-controlling interest
Purchase of own shares
Tax paid on Share Awards vested*
Equity-settled transactions
Income tax on equity-settled transactions
Total contributions by and distributions to the owners of the Company
Attributable to equity holders of the Company
Other reserves
Notes
Share capital
£m
Share
premium
£m
Translation
reserve
£m
Other
£m
Retained
earnings
£m
Total before
non-
controlling
interest
£m
Non-
controlling
interest
£m
Total
equity
£m
1.6
257.8
(87.2)
6.4
796.4
975.0
28.0
1,003.0
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(21.7)
(21.7)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
288.1
11.0
299.1
(170.6)
–
(11.4)
(6.7)
18.6
(0.3)
288.1
(10.7)
277.4
(170.6)
–
(11.4)
(6.7)
18.6
(0.3)
18.6
1.0
19.6
(17.0)
1.7
–
–
–
–
306.7
(9.7)
297.0
(187.6)
1.7
(11.4)
(6.7)
18.6
(0.3)
(170.4)
(170.4)
(15.3)
(185.7)
15
20
15
17
17
6
At 31 December 2021
1.6
257.8
(108.9)
6.4
925.1
1,082.0
32.3
1,114.3
*
The tax paid on Share Awards vested is related to settlement of the tax obligation on behalf of employees by the Group via the sale of a portion of the equity-settled shares.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Consolidated statement of changes in equity Continued
5
For the year ended 31 December
At 1 January 2022
Total comprehensive income for the year
Profit
Other comprehensive income
Total comprehensive income for the year
Transactions with owners of the Company recognised directly in equity
Contributions by and distributions to the owners of the Company
Dividends paid
Purchase of own shares
Tax paid on Share Awards vested*
Equity-settled transactions
Income tax on equity-settled transactions
Total contributions by and distributions to the owners of the Company
Attributable to equity holders of the Company
Other reserves
Notes
Share capital
£m
Share
premium
£m
Translation
reserve
£m
Other
£m
Retained
earnings
£m
Total before
non-
controlling
interest
£m
Non-
controlling
interest
£m
Total
equity
£m
1.6
257.8
(108.9)
6.4
925.1
1,082.0
32.3
1,114.3
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
61.2
61.2
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
288.8
13.1
301.9
288.8
74.3
363.1
18.0
0.3
18.3
306.8
74.6
381.4
(170.6)
(2.3)
(4.4)
17.5
(1.3)
(170.6)
(2.3)
(4.4)
17.5
(1.3)
(16.6)
–
–
–
–
(187.2)
(2.3)
(4.4)
17.5
(1.3)
(161.1)
(161.1)
(16.6)
(177.7)
15
15
17
17
6
At 31 December 2022
1.6
257.8
(47.7)
6.4
1,065.9
1,284.0
34.0
1,318.0
*
The tax paid on Share Awards vested is related to settlement of the tax obligation on behalf of employees by the Group via the sale of a portion of the equity-settled shares.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 6
Notes
2022
£m
2021
£m
For the year ended 31 December
Consolidated statement of cash flows
For the year ended 31 December
Cash flows from operating activities
Profit for the year
Adjustments for:
Depreciation charge
Amortisation of software
Amortisation of acquisition intangibles
Impairment of goodwill and other assets
Equity-settled transactions
Net financing costs
Income tax expense
(Profit)/loss on disposal of property, plant, equipment and software
Operating cash flows before changes in working capital and
operating provisions
Change in inventories
Change in trade and other receivables
Change in trade and other payables
Change in provisions
Special contributions into pension schemes
Cash generated from operations
Interest and other finance expense paid
Income taxes paid
Net cash flows generated from operating activities*
Cash flows from investing activities
Proceeds from sale of property, plant, equipment and software*
Interest received*
Acquisition of subsidiaries, net of cash acquired
Consideration paid in respect of prior year acquisitions
Acquisition of property, plant, equipment and software*
2
306.8
306.7
8
9
9
8,9
17
14
6
16
14
10
160.2
20.3
34.8
15.3
17.5
32.6
113.0
(0.4)
700.1
(0.8)
(54.3)
61.1
–
(2.0)
704.1
(37.5)
(106.7)
559.9
4.2
2.2
(63.2)
–
(116.5)
150.6
18.7
29.3
–
18.6
19.8
106.7
0.1
650.5
0.6
(29.2)
62.0
(2.7)
(2.0)
679.2
(27.0)
(102.0)
550.2
1.0
1.5
(480.9)
(10.9)
(97.1)
Net cash flows used in investing activities
(173.3)
(586.4)
Cash flows from financing activities
Purchase of own shares
Tax paid on share awards vested
Drawdown of borrowings
Repayment of borrowings
Repayment of lease liabilities*
Dividends paid to non-controlling interest
Equity dividends paid
Net cash flow generated (used in)/from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at 1 January
Exchange adjustments
Cash and cash equivalents at 31 December
Notes
15
20
14
14
14
14
2022
£m
2021
£m
(2.3)
(4.4)
477.2
(536.8)
(81.4)
(16.6)
(170.6)
(11.4)
(6.7)
471.3
(72.4)
(70.4)
(17.0)
(170.6)
(334.9)
122.8
51.7
264.0
5.0
320.7
86.6
183.4
(6.0)
264.0
The notes on pages 7 to 48 are an integral part of these consolidated financial statements.
Cash outflow relating to Separately Disclosed Items was £17.9m for year ended 31 December 2022
(2021: £16.6m).
*
Free cash flow of £368.4m (2021: £385.2m) comprises the asterisked items in the above consolidated statement of cash flows.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 7
Notes to the financial statements
1 Significant accounting policies
Basis of preparation
Accounting policies applicable to more than one section of the financial statements are shown below. Where
accounting policies relate to a specific note in the financial statements, they are set out within that note, to
provide readers of the financial statements with a more useful layout to the financial information presented.
Statement of compliance
Intertek Group plc is a public company incorporated in England & Wales and domiciled in the UK, limited by shares.
The Group financial statements as at and for the year ended 31 December 2022 consolidate those of the
Company and its subsidiaries (together referred to as the ‘Group’) and include the Group’s interest in associates.
Intertek Group plc transitioned to UK-adopted international accounting standards in its consolidated financial
statements on 1 January 2021. There was no impact or changes in accounting policies from the transition.
The Group financial statements have been prepared by the Directors in accordance with these accounting
standards in conformity with the requirements of the Companies Act 2006. The Company financial statements
present information about the Company as a separate entity and not about its Group. The Company has
elected to prepare its Company financial statements in accordance with UK GAAP, comprising FRS 101 and
applicable law; these are presented on pages 49 to 53.
Significant new accounting policies and standards
During the year no new accounting standards were adopted by the Group.
Changes in accounting policies
The accounting policies set out in these financial statements have been applied consistently to all years
presented, apart from those disclosed below. There are no new accounting standards that are effective for
annual periods beginning on or after 1 January 2022 that have a material effect on the consolidated financial
statements of the Group. There are no accounting standards that are issued but not yet effective that are
expected to have a material effect on the consolidated financial statements of the Group.
Measurement convention
The financial statements are prepared on the historical cost basis except as discussed in the relevant
accounting policies.
Functional and presentation currency
These consolidated financial statements are presented in sterling, which is the Company’s functional currency.
All information presented in sterling has been rounded to the nearest £0.1m.
Going concern
The Group has a broad customer base across its multiple business lines and in its different geographic regions
and is supported by a robust balance sheet and strong operational cash flows.
The Board has reviewed the Group’s financial forecasts up to 31 December 2024 to assess both liquidity
requirements and debt covenants.
In addition, the Group’s financial forecasts for 2023 and 2024, and the related liquidity position and forecast
compliance with debt covenants, have been sensitised for a severe yet plausible decline in economic conditions
(including an illustrative sensitivity scenario of a reduction of 30% to the base profit forecasts and the
corresponding impact to cash flow forecasts in each of these years). In addition, reverse stress testing has
also been applied to the model which represents a significant decline in cash flows compared with the 30%
downside sensitivity. Such a scenario is considered to be remote. The Board remains satisfied with the Group’s
funding and liquidity position, with the Group forecast to remain within its committed facilities and compliant
with debt covenants even following the 30% downside sensitivity. The sensitivity modelling excludes
additional mitigating actions (e.g. dividend cash payments, non-essential overheads and non-committed
capital expenditure) that are within management control and could be initiated if deemed required.
The undrawn headroom on the Group’s committed borrowing facilities at 31 December 2022 was £707.3m
(2021: £564.2m). The maturity of our borrowing facilities is disclosed in note 14 of the financial statements
with repayment of the Acquisition facilities of £130m and US$160m of senior notes required by 31 December
2023. Our models forecast these to be repaid using existing facilities following the issuance of £640m of
senior notes issued in the current year. Full details of the Group’s borrowing facilities and maturity profile are
outlined in note 14.
On the basis of its forecasts to 31 December 2024, both base case and downside, and available facilities,
the Board has concluded that there are no material uncertainties over going concern, including no anticipated
breach of covenants, and therefore the going concern basis of preparation continues to be appropriate.
Consideration of climate change
In preparing the financial statements, we have considered the impact of climate change (refer to Book one,
page 49 for further information). There is no material impact on the financial reporting judgement and
estimates arising from our considerations which is consistent with the assertion that risks associated with
climate change are not expected to have a material impact on the viability of the Group in the short, medium
and long term. Specifically we note the following:
• The Group continues to invest in on-site renewable energy generation at our locations.
• We have specifically considered the impact of climate change on the carrying value of fixed assets
(see note 8).
• The Group has not bought carbon credits in 2022 (2021: nil) to offset our measured Scope 1, 2 and 3 GHG
emissions.
Government grants
Government grants are recognised in the income statement so as to match them with the related expenses
that they are intended to compensate. Where grants are received in advance of the related expenses, they are
initially recognised in the balance sheet and released to match the related expenditure. Non-monetary grants
are recognised at fair value. The related cash flow is classified in accordance with the nature of the activity.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 1 Significant accounting policies Continued
Basis of consolidation
Subsidiaries
Subsidiaries are those entities controlled by the Group. Control exists when the Group has power to direct the
relevant activities, exposure to variable returns from the investee and the ability to use its power over the
investee to affect the amount of investor returns. The financial statements of subsidiaries are included in the
consolidated financial statements from the date that control commences until the date that control ceases.
For purchases of non-controlling interest in subsidiaries, the difference between the cost of the additional
interest in the subsidiary and the non-controlling interest’s share of the assets and liabilities reflected in the
consolidated statement of financial position at the date of acquisition, is reflected directly in shareholders’ equity.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised gains and losses or income and expenses arising from
intra-group transactions, are eliminated in preparing the consolidated financial statements. Unrealised losses are
eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.
Foreign currency
Foreign currency transactions
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at
the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities (for example
cash, trade receivables, trade payables) denominated in foreign currencies at the reporting date are translated
at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are
generally recognised in the income statement. Non-monetary assets and liabilities that are measured in terms
of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.
For the policy on hedging of foreign currency transactions see note 14.
Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on
acquisition, are translated to sterling at foreign exchange rates ruling at the reporting date.
The income and expenses of foreign operations are translated into sterling at cumulative average rates of
exchange during the year. Exchange differences arising from the translation of foreign operations are taken
directly to equity in the translation reserve. They are released to the income statement upon disposal. For
the policy on net investment hedging see note 14.
The most significant currencies for the Group were translated at the following exchange rates:
Value of £1
US dollar
Euro
Chinese renminbi
Hong Kong dollar
Australian dollar
Assets and liabilities
Actual rates
Income and expenses
Cumulative average rates
31 December
2022
1.20
1.13
8.45
9.37
1.78
31 December
2021
1.35
1.19
8.59
10.52
1.86
2022
1.24
1.17
8.31
9.68
1.78
2021
1.38
1.16
8.89
10.70
1.83
8
Key Estimations and Uncertainties
The preparation of financial statements in conformity with IFRSs requires management to make judgements
and estimates that affect the application of accounting policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions
are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the year in which the
estimates are revised and in any future years affected.
Discussed below are key assumptions concerning the future, and other key sources of estimation at the
reporting date, that could have a risk of causing a material adjustment to the carrying amount of assets and
liabilities within the next financial year.
Impairment of goodwill
Following recognition of goodwill as a result of acquisitions, the Group determines, as a minimum on an annual
basis and including current year acquisitions, whether goodwill is impaired, which requires an estimation of the
future cash flows of the cash generating units to which the goodwill is allocated, as well as assumptions on
growth rates and discount rates – see note 9. There is no significant risk of material impairment within the next
financial year.
Employee post-retirement benefit obligations
For material defined benefit plans, the actuarial valuation includes assumptions such as discount rates,
return on assets, salary progression and mortality rates. Further details and sensitivity analysis are included
in note 16.
There are no critical accounting judgements.
Other accounting policies
Accounting policies relating to a specific note in the financial statements are set out within that note
as follows:
Revenue
Separately Disclosed Items
Taxation
Property, plant and equipment
Goodwill and other intangible assets
Trade and other receivables
Trade and other payables
Provisions
Borrowings and financial instruments
Capital and reserves
Employee benefits
Share schemes
Non-controlling interest
Note
2
3
6
8
9
11
12
13
14
15
16
17
20
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 9
2 Operating segments and presentation of results
Accounting policy
Revenue
Revenue represents the total amount receivable for services rendered when there is transfer of control to the
customer, excluding sales-related taxes and intra-group transactions.
Revenue from services rendered on short-term projects is generally recognised in the income statement when
the relevant service is completed, usually when the report of findings or test/inspection certificate is issued.
Short-term projects are considered to be those of less than two months’ duration.
In line with IFRS 15, rebates and customer discounts are considered to be variable consideration and have been
deducted from recognised revenue.
Revenue is recognised using the five steps for revenue recognition. The majority of contracts are for less than
one year. The Group records transactions as sales on the basis of value of work done, with the corresponding
amount being included in trade receivables if the customer has been invoiced, or in contract assets, if billing
has yet to be completed. Performance obligations vary across business lines and regions, and on a contract-by-
contract basis. There may be more than one performance obligation per contract, for example Alchemy
Training Solutions contracts have multiple elements which are split between recognising Revenue at a point
in time for services such as right of use software licences and over time for other services delivered under
the same contract.
Long-term projects consist of two main types:
• time incurred is billed at agreed rates on a periodic basis, such as monthly; or
• staged payment invoicing occurs, requiring an assessment of percentage completion, based on services
provided and revenue accrued accordingly.
Expenses are recharged to clients where permitted by the contract. Payments received in advance from
customers are recognised in contract liabilities to the extent that performance obligations have not been
satisfied.
The Group does not expect to have any material contracts where the period between the transfer of promised
goods or services to the customer and payment by the customer exceeds one year. As a consequence, the
Group does not adjust any of the transaction prices for the time value of money.
The Group has applied practical expedients in i) recognising assets from the costs incurred to obtain or fulfil a
contract; and ii) in disclosing unsatisfied performance obligations in contracts as contracts have an expected
duration of less than a year. The economic factors affecting revenue for both short- and long-term contracts
are consistent within each.
Operating segments
The Group is organised into business lines, which are the Group’s operating segments and are reported to the
CEO, the chief operating decision maker.
These operating segments are aggregated into three divisions, which are the Group’s reportable segments,
based on similar nature of products and services and mid- to long-term structural growth drivers. When
aggregating operating segments into the three divisions we have applied judgement over the similarities
of the services provided, the customer base and the mid- to long-term structural growth drivers.
The costs of the corporate head office and other costs which are not controlled by the three divisions are
allocated appropriately.
Inter-segment pricing is determined on an arm’s length basis. There is no significant seasonality in the Group’s
operations. Segment results include items directly attributable to a segment as well as those that can be
allocated on a reasonable basis.
The performance of the segments is assessed based on adjusted operating profit which is stated before
Separately Disclosed Items. The operating segment revenue disclosures provided under IFRS 8 are consistent
with the disaggregated revenue disclosure and recognition and measurement requirements of IFRS 15.
A reconciliation to operating profit by division and Group profit for the year is included overleaf.
The principal activities of the divisions, and the customers they serve, are as follows:
Products – Our Products division consists of business lines that are focused on ensuring the quality and safety
of physical components and products, as well as minimising risk through assessing the operating process and
quality management systems of our customers.
As a trusted partner to the world’s leading retailers, manufacturers and distributors, our Products business
lines support a wide range of industries including textiles, footwear, toys, hardlines, home appliances, consumer
electronics, information and communication technology, automotive, aerospace, lighting, building products,
industrial and renewable energy products, food and hospitality, healthcare and beauty, and pharmaceuticals.
Across these industries we provide a wide range of Assurance, Testing, Inspection and Certification (‘ATIC’)
services including laboratory safety, quality and performance testing, second-party supplier auditing,
sustainability analysis, products assurance, vendor compliance, people assurance, process performance
analysis, facility plant and equipment verification and third-party certification.
Trade – Our Trade division consists of three global business lines with similar global and regional trade-flow
structural growth drivers with demand driven by population and GDP growth, the development of regional
trade, increased traceability and growth in port and transport infrastructure.
The division provides differing services which reflect the breadth of our ATIC offering, but the services provided
are similar in nature and include analytical assessment, inspection and technical services that are delivered to
the customers through issuing certificates or reports. The three business lines all assist our Trade-related
customers in protecting the value and quality of their products during their custody-transfer, storage and
transportation, globally. Our Trade-related customers are all dependent on, and intrinsically linked to, global
shipping and trade flows.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 10
The results of these divisions for the year ended 31 December are shown below:
2 Operating segments and presentation of results Continued
Our Caleb Brett business provides cargo inspection, analytical assessment, calibration and related research and
technical services to the world’s petroleum and biofuels industries.
Our Government & Trade Services business provides inspection services to governments and regulatory bodies
to support trade activities that help the flow of goods across borders, predominantly in the Middle East, Africa
and South America.
Year ended 31 December 2022
Our AgriWorld business provides analytical and testing services to global agricultural trading companies
and growers.
Resources – Our Resources division consists of two business lines demonstrating similar mid- to long-term
structural growth drivers closely linked to our end-customer capital investment. Demand is driven by long-term
energy demand, supply chain risk management, sustainability of energy supply, infrastructure investments,
growth in alternative energy and focus on health and safety.
The division offers similar services across our range of Total Quality Assurance (‘TQA’) solutions to the oil, gas,
nuclear, power and minerals industries. Our Resources customers typically extract natural resources from the
ground and our services enable our customers to optimise the use of their assets and to minimise risk in their
supply chains. Delivery of our services is through issuing certificates or reports.
Our Industry Services business uses in-depth knowledge of the oil, gas, nuclear and power industries to provide
a diverse range of TQA solutions to optimise the use of customers’ assets and minimise the risk in their supply
chains. Some of our key services include technical inspection, asset integrity management, analytical testing
and ongoing training services.
Our Minerals business provides a broad range of ATIC service solutions to the mining and minerals exploration
industries, covering the resource supply chain from exploration and resource development, through to
production, shipping and commercial settlement.
Products
Trade
Resources
Total
Group operating profit
Net financing costs
Profit before income tax
Income tax (expense)/credit
Profit for the year
Year ended 31 December 2021
Products
Trade
Resources
Total
Group operating profit
Net financing (costs)/income
Profit before income tax
Income tax (expense)/credit
Profit for the year
Depreciation
and software
amortisation
£m
Adjusted
operating
profit
£m
Separately
Disclosed
Items
£m
Operating
profit
£m
Revenue
from
contracts
with
customers
£m
2,024.3
635.6
533.0
(113.5)
(43.4)
(23.6)
3,192.9
(180.5)
426.9
57.9
35.3
520.1
520.1
(31.9)
488.2
(128.4)
(50.4)
(8.6)
(8.7)
(67.7)
(67.7)
(0.7)
(68.4)
15.4
376.5
49.3
26.6
452.4
452.4
(32.6)
419.8
(113.0)
359.8
(53.0)
306.8
Revenue
from
contracts
with
customers
£m
1,755.3
575.4
455.6
2,786.3
Depreciation
and software
amortisation
£m
Adjusted
operating
profit
£m
Separately
Disclosed
Items
£m
Operating
profit
£m
(106.3)
(43.7)
(19.3)
(169.3)
399.7
51.6
22.6
473.9
473.9
(28.4)
445.5
(118.0)
327.5
(34.3)
(1.4)
(5.0)
(40.7)
(40.7)
8.6
(32.1)
11.3
(20.8)
365.4
50.2
17.6
433.2
433.2
(19.8)
413.4
(106.7)
306.7
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 11
2 Operating segments and presentation of results Continued
Geographic segments
Although the Group is managed through a divisional structure, which operates on a global basis, under the
requirements of IFRS 8 the Group must disclose any specific countries that are important to the Group’s
performance. The Group considers the following to be the material countries in which it operates: the United
States, China (including Hong Kong),the United Kingdom and, following the acquisition of SAI in 2021, Australia.
in operating costs. Amortisation of software, however, is included in adjusted operating profit as it is similar
in nature to other capital expenditure.
The costs associated with our cost reduction programme are excluded from adjusted operating profit where
they represent changes associated with operational streamlining and technology upgrades and are costs
that are not expected to reoccur. The restructuring programme is expected to last up to five years.
In presenting information on the basis of geographic segments, segment revenue is based on the location of
the entity recognising that revenue. Segment assets are based on the geographical location of the assets.
The treatment as SDI is consistent with the disclosure of costs for similar restructuring and strategic
programmes previously undertaken.
United States
China (including Hong Kong)
United Kingdom
Australia
Other countries and unallocated
Revenue from external
customers
Non-current assets
2022
£m
2021
£m
2022
£m
958.3
591.3
203.5
174.9
1,264.9
837.1
550.3
173.9
110.6
1,114.4
1,139.4
97.3
264.2
555.9
418.9
2021
£m
974.2
81.4
226.8
541.6
417.7
The impairment of goodwill and other assets that by their nature or size are not expected to recur; the profit
and loss on disposals of businesses or other significant assets; and the costs associated with successful,
active or aborted acquisitions are excluded from adjusted operating profit to provide useful information
regarding the year-on-year performance of the Group’s operations.
As adjusted results include the benefits of the items detailed above, but exclude significant costs related to
those items, they should not be regarded as a complete picture of the Group’s financial performance, which is
presented on the face of the income statement under total results. The exclusion of these items may result
in adjusted operating profit being materially higher or lower than total operating profit. In particular, where
significant impairments, restructuring charges and legal costs are excluded in any year, adjusted operating
profit will be higher than total operating profit.
Total
3,192.9
2,786.3
2,475.7
2,241.7
Major customers
No revenue from any individual customer exceeded 10% of total Group revenue in 2022 or 2021.
Separately Disclosed Items
The Separately Disclosed Items are described in the table below:
3 Separately Disclosed Items
Accounting policy
Adjusted results
In order to present the performance of the Group in a clear, consistent and comparable format, certain items
are disclosed separately on the face of the income statement. Separately Disclosed Items (‘SDI’) are items
which by their nature or size, in the opinion of the Directors, should be excluded from the adjusted result to
provide readers with a clear and consistent view of the business performance of the Group and its operating
divisions on a year-on-year basis. A full glossary and definitions of adjusted performance metrics used by the
Group is included on page 61.
When applicable, these items include amortisation of acquisition intangibles; impairment of goodwill and other
assets; the profit or loss on disposals of businesses or other significant non-current assets; costs of acquiring
and integrating acquisitions; the cost of any fundamental restructuring; the costs of any significant strategic
projects; material claims and settlements; and unrealised market or fair value gains or losses on financial assets
or liabilities, including contingent consideration.
Adjusted operating profit, which is a non-GAAP measure, excludes the amortisation of acquired intangible
assets, primarily customer relationships, as we do not believe that the amortisation charge in the income
statement provides useful information about the cash costs of running our business as these assets will be
supported and maintained by the ongoing marketing and promotional expenditure, which is already reflected
Operating costs:
Amortisation of acquisition intangibles
Acquisition and integration costs
Restructuring costs
Total operating costs
Net financing (cost)/income
Total before income tax
Income tax credit on Separately Disclosed Items
Total
(a)
(b)
(c)
(d)
2022
£m
(34.8)
(5.5)
(27.4)
(67.7)
(0.7)
(68.4)
15.4
(53.0)
2021
£m
(29.3)
(11.4)
–
(40.7)
8.6
(32.1)
11.3
(20.8)
(a) Of the amortisation of acquisition intangibles in the current year, £0.8m relates to the customer relationships, trade names and technology
acquired with the purchase of Clean Energy Associates, LLC (‘CEA’) in 2022.
(b) Acquisition and integration costs comprise £1.8m (2021: £11.3m) for transaction and integration costs in respect of successful, active and
aborted acquisitions in the current year, and £3.7m in respect of prior-years’ acquisitions (2021: £0.1m).
(c) During 2022, the Group initiated the first year of a cost reduction programme. In 2022, costs of £27.4m (2021: £nil) included consolidating
sites and offices, streamlining headcount, Group-wide technology upgrades and related asset write-offs.
(d) Net financing cost of £0.7m (2021: £8.6m income). In relation to acquisitions from prior periods, the 2022 cost is the unwinding of discount
and changes in fair value of contingent consideration. The 2021 income was the release of contingent consideration due to terms not being
met in relation to acquisitions from prior periods.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 12
Details of pension arrangements and equity-settled transactions are set out in notes 16 and 17 respectively.
2022
2021
24,171
9,699
7,893
2,022
23,378
9,970
8,315
1,917
43,785
43,580
43,597
44,063
2022
£m
3.5
1.2
4.7
2021
£m
5.4
2.2
7.6
4 Expenses and auditors’ remuneration
An analysis of operating costs by nature is outlined below:
Employee costs
Depreciation and software amortisation (notes 8 and 9)
Other expenses
Total
2022
£m
1,394.7
180.5
1,165.3
2021
£m
1,242.6
169.3
941.2
Average number of employees by division
Products
Trade
Resources
Central
Total average number for the year ended 31 December
2,740.5
2,353.1
Total actual number at 31 December
Certain expenses are outlined below, including fees paid to the auditors of the Group:
The total remuneration of the Directors is shown below:
Included in profit for the year are the following expenses:
Property rentals
Lease and hire charges – fixtures, fittings and equipment
Government grants related to employee costs
(Profit)/loss on disposal of property, plant, equipment and software
Auditors’ remuneration:
Audit of these financial statements
Amounts receivable by the auditors and their associates in respect of:
Audit of financial statements of subsidiaries pursuant to legislation
Total audit fees payable pursuant to legislation
Audit-related services
Total
5 Employees
Total employee costs are shown below:
Employee costs
Wages and salaries
Equity-settled transactions
Social security costs
Pension costs (note 16)
Total employee costs
2022
£m
7.3
12.4
(9.7)
(0.4)
1.2
4.7
5.9
0.2
6.1
2021
£m
7.1
9.5
(15.6)
0.8
0.9
3.8
4.7
0.1
4.8
2022
£m
2021
£m
1,182.8
17.5
132.9
61.5
1,050.9
18.6
119.3
53.8
1,394.7
1,242.6
Directors’ emoluments
Directors’ remuneration
Amounts charged under the long-term incentive scheme
Total Directors’ emoluments
6 Taxation
Accounting policy
Income tax for the year comprises current and deferred tax. Income tax is recognised in the same primary
statement as the accounting transaction to which it relates.
Current tax
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
Tax provisions are recognised for uncertain tax positions where a risk of an additional tax liability has been
identified and it is probable that the Group will be required to settle that tax liability. Measurement is dependent
on management’s expectation of the outcome of decisions by tax authorities in the various tax jurisdictions in
which the Group operates. This is assessed on a case-by-case basis using in-house tax experts, professional firms
and previous experience. Where the outcome of discussions with tax authorities is different from the amount
initially recorded, this difference will impact the tax expense in the period in which the determination is made.
Deferred tax
Deferred tax is provided using the balance sheet liability method, providing for temporary differences
between the carrying amount of assets and liabilities for financial reporting purposes and the amounts
used for taxation purposes, except for:
• recognition of consolidated goodwill;
• the initial recognition of assets or liabilities in a transaction that is not a business combination and that
affects neither accounting nor taxable profit; and
• differences relating to investments in subsidiaries, branches, associates and interest in joint ventures,
the reversal of which is under the control of the Group and where it is probable that the difference will
not reverse in the foreseeable future.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 6 Taxation Continued
The amount of deferred tax provided is based on the expected manner of realisation or settlement of the
carrying amount of assets and liabilities, using tax rates that have been enacted or substantively enacted at
the balance sheet date, for the periods when the asset is realised or the liability is settled. Deferred tax assets
and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets and they
relate to income taxes levied by the same tax authority on the same taxable entity, or on different taxable
entities which intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities
will be realised simultaneously.
Deferred tax assets are recognised to the extent that there are taxable temporary differences relating to
the same taxation authority, the same taxable company or different taxable companies part of the same
tax group, which are expected to reverse in the same period, or to the extent that it is probable that future
taxable profits will be available against which the temporary difference can be utilised. The carrying amount
of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset to be
utilised. In calculating future taxable profits, the future forecasts considered were consistent with those
used for the purposes of the Group’s going concern and viability assessments.
The Group does not currently expect the climate related risks discussed in Book one, pages 49 to 57 to have an
impact on the availability to recover the deferred tax assets identified below. Any additional income taxes that
arise from the distribution of dividends are recognised at the same time as the liability to pay the related dividend.
Tax expense
The Group operates across many different tax jurisdictions. Income and profits are earned and taxed in the
individual countries in which they occur.
The statutory tax charge, including the impact of SDIs, of £113.0m (2021: £106.7m), equates to an effective
rate of 26.9% (2021: 25.8% and the cash tax on adjusted results is 21.9% (2021: 22.9%). The income tax
expense for the adjusted profit before tax for the 12 months ended 31 December 2022 is £128.4m (2021:
£118.0m). The Group’s adjusted consolidated effective tax rate for the 12 months ended 31 December 2022
is 26.3% (2021: 26.5%).
Differences between the consolidated effective tax rate of 26.3% and notional statutory UK rate of 19.0%
include but are not limited to: the mix of profits; the effect of tax rates in foreign jurisdictions; non-deductible
expenses; the effect of movement in unrecognised deferred tax asset; movements in the provision for
uncertain tax positions; withholding tax on intra-group dividends; tax exempt income; and under/over
provisions in previous periods.
The Group receives tax incentives in certain jurisdictions, resulting in a lower tax charge to the income
statement. These tax incentives mainly relate to China’s High and New Technology Enterprise and Technology
Advanced Service Enterprise incentives. Without these incentives the adjusted effective tax rate would be
28.3% (2021: 29.0%). The tax on SDI’s primarily relate to intangibles, impairment of fixed assets, restructuring
and integration. During 2021, the OECD published a framework for the introduction of a global minimum
effective tax rate of 15%, applicable to large multinational groups. HM Treasury has published draft legislation
to implement these ‘Pillar Two’ rules for accounting periods starting on or after 31 December 2023. The Group is
reviewing these draft rules, which have not been substantively enacted, to understand any potential impacts.
13
Tax charge
The total income tax charge, comprising the current tax charge and the movement in deferred tax, recognised
in the income statement is analysed as follows:
Current tax charge for the period
Adjustments relating to prior year liabilities
Current tax
Deferred tax movement related to current year
Deferred tax movement related to prior year
Deferred tax movement
Total tax in income statement
Tax on adjusted result
Tax on Separately Disclosed Items
Total tax in income statement
2022
£m
114.4
(3.7)
110.7
0.8
1.5
2.3
113.0
128.4
(15.4)
113.0
2021
£m
110.4
3.6
114.0
(2.1)
(5.2)
(7.3)
106.7
118.0
(11.3)
106.7
Reconciliation of effective tax rate
The following table provides a reconciliation of the UK statutory corporation tax rate to the effective tax rate
of the Group on profit before taxation.
Profit before taxation
Notional tax charge at UK standard rate 19.0% (2021: 19.0%)
Differences in overseas tax rates
Withholding tax on intercompany dividends
Non-deductible expenses
Tax exempt income
Change in tax rate impact
Movement in unrecognised deferred tax
Adjustments in respect of prior years1
Other2
2022
£m
2021
£m
419.8
413.4
79.8
7.6
8.5
20.7
(5.1)
(1.6)
3.0
(2.2)
2.3
78.5
13.2
10.0
13.5
(7.0)
(0.1)
1.3
(1.6)
(1.1)
Total tax in income statement
113.0
106.7
1. Adjustments in respect of prior years include a £0.6m charge relating to a tax settlement in Ghana and a £0.8m credit in the UK relating to
higher double tax relief for overseas taxes.
2. The Other category contains R&D tax credits and super deductions of £2.6m (2021: £2.6m) and a net provision charge of £2.7m (2021:
£0.6m) following the review of uncertain tax provisions across multiple territories. The remainder represents other local taxes.
The main rate of UK corporation tax is 19.0% and it has been substantively enacted on 24 May 2021 that the
rate will increase to 25.0% from 1 April 2023. The consequential effect on the Group’s future tax charge was
disclosed in the prior year financial statements.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 14
6 Taxation Continued
Income tax recognised in other comprehensive income (‘OCI’)
As noted in the accounting policy, tax is recognised in the same place as the relevant accounting charge.
The income tax recognised on items recorded in other comprehensive income is shown below:
Deferred tax
Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:
Foreign exchange translation
differences of foreign
operations
Net exchange gain/(loss) on
hedges of net investments
in foreign operations
Gain on fair value of cash
flow hedges
Remeasurements on defined
benefit pension schemes
Tax on other items that will
never be reclassified to
profit or loss
Total other
comprehensive
(expense)/income for
the year
Before tax
2022
£m
Tax charge
2022
£m
Net of tax
2022
£m
Before tax
2021
£m
Tax charge
2021
£m
Net of tax
2021
£m
181.5
(4.9)
176.6
(24.7)
(120.0)
–
(120.0)
–
4.1
4.1
4.0
–
17.4
(3.5)
13.9
11.5
–
–
1.7
(2.2)
(24.7)
4.0
1.7
9.3
Intangible assets
Property, plant and
equipment
Pensions
Equity-settled transactions
Provisions and other
temporary differences
Tax value of losses
Total
As shown on balance sheet:
Deferred tax assets*
Deferred tax liabilities*
–
–
–
–
–
–
Total
Assets
2022
£m
0.2
4.2
0.7
5.3
60.7
13.7
84.8
Assets
2021
£m
Liabilities
2022
£m
Liabilities
2021
£m
Net
2022
£m
Net
2021
£m
0.3
6.6
1.2
7.7
62.9
10.9
89.6
(94.0)
(90.9)
(93.8)
(90.6)
(17.3)
(4.8)
–
(22.9)
–
(3.4)
(1.4)
–
(22.0)
–
(13.1)
(4.1)
5.3
37.8
13.7
3.2
(0.2)
7.7
40.9
10.9
(139.0)
(117.7)
(54.2)
(28.1)
45.0
(99.2)
(54.2)
39.3
(67.4)
(28.1)
*
The deferred tax by category shown above is not netted off within companies or jurisdictions. The balance sheet shows the net position
within companies or jurisdictions. The difference between the two asset and liability totals is £39.8m, but the net liability of £54.2m is the
same in both cases. Deferred tax assets totalling £6.3m have been recognised primarily in respect of Argentina, Brazil and Saudi Arabia that
have taxable losses either in the current or prior period. In evaluating whether it is probable that taxable profits will be earned in future
accounting periods, all available evidence was considered, including approved budgets and forecasts. These forecasts are consistent with
those used internally by management when considering the Group’s going concern and viability assessments. Following this evaluation, it is
considered more likely than not that there will be sufficient future taxable profits to realise these deferred tax assets, the majority of which
can be carried forward indefinitely excluding £1.6m losses which are due to expire within five years and £0.2m losses which are due to expire
after five years. Of the £84.1m of deferred tax assets displayed above, £25.8m are expected to be recovered within 12 months of the date
of this Annual Report & Accounts.
78.9
(4.3)
74.6
(9.2)
(0.5)
(9.7)
Income tax recognised directly in equity
As noted in the accounting policy, tax is recognised in the same place as the relevant accounting charge.
The income tax on items recognised in equity is shown below:
Before tax
2022
£m
Tax charge
2022
£m
Net of tax
2022
£m
Before tax
2021
£m
Tax charge
2021
£m
Net of tax
2021
£m
Equity-settled
transactions
17.5
(1.3)
16.2
18.6
(0.3)
18.3
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 15
6 Taxation Continued
Movements in deferred tax temporary differences during the year
The move ment in the year in deferred tax assets and liabilities is shown below:
Unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect of the items shown below. The numbers shown are
the gross temporary differences, and to calculate the potential deferred tax asset it is necessary to multiply
these by the tax rates in each case:
Intangible assets
Property, fixtures, fittings
and equipment
Pensions
Equity-settled transactions
Provisions and other
temporary differences
Tax value of losses
1 January
2022
£m
Exchange
adjustments
£m
Acquisitions
£m
Recognised
in income
statement
£m
Recognised
in equity and
OCI
£m
31 December
2022
£m
(90.6)
(12.2)
(8.0)
17.0
–
(93.8)
3.2
(0.2)
7.7
40.9
10.9
0.1
–
–
0.8
0.6
–
–
–
(3.1)
2.8
(8.3)
(16.4)
(0.4)
(1.1)
(0.8)
(0.6)
(2.3)
–
(3.5)
(1.3)
–
–
(13.1)
(4.1)
5.3
37.8
13.7
(4.8)
(54.2)
Total
(28.1)
(10.7)
1 January
2021
£m
Exchange
adjustments
£m
Acquisitions
£m
Recognised
in income
statement
£m
Recognised
in equity and
OCI
£m
31 December
2021
£m
Intangible assets
Property, fixtures, fittings
and equipment
Pensions
Equity-settled transactions
Provisions and other
temporary differences
Tax value of losses
Total
(72.1)
3.2
1.8
8.3
38.7
9.0
(11.1)
2.1
0.6
–
–
(1.6)
(0.2)
0.9
(29.7)
0.1
0.1
–
2.2
4.8
(22.5)
9.1
(0.7)
0.1
(0.1)
1.6
(2.7)
7.3
–
(90.6)
–
(2.2)
(0.5)
–
–
3.2
(0.2)
7.7
40.9
10.9
(2.7)
(28.1)
Intangibles
Pensions
Provisions and other temporary differences
Tax losses
Foreign tax credits1
Property, fixtures, fittings and equipment
Total
2022
£m
32.3
1.5
1.0
176.0
13.5
–
224.3
2021
£m
29.3
1.5
–
161.9
12.0
0.5
205.2
1. The total unrecognised foreign tax credits is £3.6m, the grossed-up equivalent amount of which is £13.5m as stated above.
Deferred tax assets have not been recognised in respect of these items because it is not probable that
future taxable profits will be available in certain jurisdictions against which the Group can utilise the
benefits from them.
Of the unrecognised tax losses above, £110.8m (2021: £110.8m) of these relate to US state tax losses
due to insufficient taxable profits expected in the relevant states. In addition, £8.2m (2021: £8.2m) of these
unrecognised losses relate to a dormant company resident in Hong Kong with no probable future profits.
A further £14.8m (2021: £8.4m) of these unrecognised losses relate to entities based in the UK, however
these relate to (i) non trade deficits in entities where there is no probable prospect of future non trade
profits and (ii) capital losses where there is uncertainty on their utilisation in future periods.
There is a temporary difference of £285.1m (2021: £284.4m) which relates to unremitted post-acquisition
overseas earnings. No deferred tax is provided on this amount as the distribution of these retained earnings
is under the control of the Group and there is no intention to either repatriate from, or sell, the associated
subsidiaries in the foreseeable future.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 6 Taxation Continued
Expiry of unrecognised deferred tax assets – tax losses and tax credits
Tax losses expiring:
Within 10 years
More than 10 years
Available indefinitely
Total
Tax credits expiring:
Within 10 years
More than 10 years
Available indefinitely
Total
16
2022
£m
51.2
73.0
51.8
2021
£m
55.2
60.2
44.0
176.0
159.4
13.5
–
–
13.5
12.0
–
–
12.0
In addition to the above, no specified time expiry is anticipated in respect of the other unrecognised deferred
tax assets.
7 Earnings per ordinary share
The calculation of earnings per ordinary share is based on profit attributable to ordinary shareholders of the
Company and the weighted average number of ordinary shares in issue during the year. Diluted earnings per
share is calculated by adjusting the weighted average number of ordinary shares in issue on the assumption of
conversion of all potentially dilutive ordinary shares. Potential ordinary shares shall be treated as dilutive when,
and only when, their conversion to ordinary shares would decrease earnings per share or increase loss per
share from continuing operations.
In addition to the earnings per share required by IAS 33 Earnings Per Share, an adjusted earnings per share has
also been calculated and is based on earnings excluding the effect of amortisation of acquisition intangibles,
goodwill impairment and other Separately Disclosed Items. It has been calculated to allow shareholders a
better understanding of the trading performance of the Group. Details of the adjusted earnings per share
are set out below:
Profit attributable to ordinary shareholders
Separately Disclosed Items after tax (note 3)
Adjusted earnings
Number of shares (millions)
Basic weighted average number of ordinary shares
Potentially dilutive share awards
Diluted weighted average number of shares
Basic earnings per share
Potentially dilutive share awards
Diluted earnings per share
Adjusted basic earnings per share
Potentially dilutive share awards
Adjusted diluted earnings per share
2022
£m
288.8
53.0
341.8
161.2
0.7
161.9
179.2p
(0.8)p
2021
£m
288.1
20.8
308.9
161.2
0.7
161.9
178.7p
(0.8)p
178.4p
177.9p
212.0p
(0.9)p
191.6p
(0.8)p
211.1p
190.8p
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents
8 Property, plant and equipment
Accounting policy
Property, plant and equipment
Owned assets
Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated
impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset.
Leased assets
All leases where the Group is the lessee (with the exception of short-term and low-value leases) are recognised
in the statement of financial position. A lease liability is recognised based on the present value of the future
lease payments, and a corresponding right-of-use asset is recognised. The right-of-use asset is depreciated
over the shorter of the lease term or the useful life of the asset. Lease payments are apportioned between
finance charges and a reduction of the lease liability.
Low-value items, usually below £4,000, and short-term leases with a term of 12 months or less are not
required to be recognised on the balance sheet and payments made in relation to these leases are recognised
on a straight-line basis in the income statement. The Group leases various properties, principally offices and
testing laboratories, which have varying terms and renewal rights that are typical to the territory in which they
are located. Non-property includes all other leases, such as cars and printers. Normally the lease term is the
contractual start to end date, except when a break or extension option are reasonably certain to be taken,
which are considered on a lease-by-lease basis.
Depreciation
Depreciation is charged to the income statement on a straight-line basis over the estimated useful lives of
items of property, plant and equipment. Leased assets are depreciated over the shorter of the expected lease
term and their useful lives. Freehold land is not depreciated.
The estimated useful lives are as follows:
Freehold buildings
Leasehold buildings
Fixtures, fittings, plant and equipment
50 years
Term of lease
3 to 10 years
Depreciation methods, residual values and the useful lives of assets are reassessed at each reporting date.
Impairment
Non-financial assets
The carrying amounts of the Group’s non-financial assets, other than inventories and deferred tax assets,
are reviewed at each reporting date to determine whether there is any indication of impairment. If any such
indication exists, then the asset’s recoverable amount is estimated to determine the level of any impairment.
17
Property, plant and equipment
The property, plant and equipment employed by the business is analysed below:
Cost
At 1 January 2021
Exchange adjustments
Additions
Disposals
Businesses acquired (note 10)
At 31 December 2021
Accumulated depreciation
At 1 January 2021
Exchange adjustments
Charge for the year
Disposals
At 31 December 2021
Net book value at 31 December 2021
Cost
At 1 January 2022
Exchange adjustments
Additions
Disposals
Businesses acquired (note 10)
At 31 December 2022
Accumulated depreciation
At 1 January 2022
Exchange adjustments
Charge for the year
Impairments
Disposals
At 31 December 2022
Net book value at 31 December 2022
Fixtures,
fittings, plant
and
equipment
£m
Land and
buildings
£m
513.6
(9.3)
127.1
(58.0)
3.8
1,176.2
(31.3)
93.7
(65.9)
2.3
Total
£m
1,689.8
(40.6)
220.8
(123.9)
6.1
577.2
1,175.0
1,752.2
269.4
(2.1)
61.4
(51.8)
276.9
300.3
834.6
(25.8)
89.2
(64.5)
833.5
341.5
1,104.0
(27.9)
150.6
(116.3)
1,110.4
641.8
Fixtures,
fittings, plant
and
equipment
£m
Land and
buildings
£m
Total
£m
577.2
38.0
87.5
(57.4)
–
1,175.0
67.9
110.4
(54.2)
0.1
1,752.2
105.9
197.9
(111.6)
0.1
645.3
1,299.2
1,944.5
276.9
20.2
66.4
–
(47.7)
315.8
329.5
833.5
56.7
93.8
2.4
(52.1)
1,110.4
76.9
160.2
2.4
(99.8)
934.3
1,250.1
364.9
694.4
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 18
8 Property, plant and equipment Continued
Fixtures, fittings, plant and equipment include assets in the course of construction of £33.6m at 31 December
2022 (2021: £27.0m), mainly comprising laboratories under construction. These assets will not be depreciated
until they are available for use.
9 Goodwill and other intangible assets
Accounting policy
Goodwill
Goodwill arises on the acquisition of businesses. Goodwill represents the difference between the cost
of acquisition and the Group’s interest in the fair value of the identifiable assets and liabilities acquired.
The net book value of land and buildings comprised:
Freehold
Leasehold
Total
2022
£m
56.6
272.9
329.5
2021
£m
57.1
243.2
300.3
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash generating
units (‘CGUs’) and is not amortised but is tested annually for impairment.
Acquisitions on or after 1 January 2010
From 1 January 2010, the Group has prospectively applied IFRS 3 Business Combinations (revised 2008).
Business combinations are accounted for using the acquisition method at the acquisition date, which is the
date on which control is obtained.
Contracts for capital expenditure which are not provided in the financial statements amounted to £7.4m
(2021: £10.3m).
We have specifically reviewed our portfolio of freehold properties (total 2022 net book value of £56.6m
(2021: £57.1m)) to consider whether there are indications of material impairment arising from the potential
physical risks arising from climate change. We have not impaired any assets this year as a result of this exercise.
The Group measures goodwill as the fair value of the consideration transferred less the net recognised
amount (generally fair value) of the identifiable assets acquired and liabilities assumed, all measured as of
the acquisition date.
Costs related to the acquisition, other than those associated with the issue of debt or equity securities,
are expensed as incurred. Costs relating to acquisitions are shown in note 3.
As a result of the Group’s cost reduction programme initiated in 2022, there were individual fixtures, fittings,
plant and equipment assets no longer in use which resulted in an impairment of £2.4m (2021: £nil) with the
cost recognised in SDI as a restructuring cost (see note 3).
Any contingent consideration payable is recognised at fair value at the acquisition date with subsequent
changes recognised in profit or loss.
The net book value of the right-of-use asset for leases comprised:
At 1 January 2022
Cost movement in year
Depreciation movement in year
Net book value at 31 December 2022
Land and
buildings
£m
240.3
63.1
(33.9)
269.5
Other
£m
26.5
4.9
(3.3)
28.1
Total
£m
266.8
68.0
(37.2)
297.6
For lease liabilities, interest expenses on lease liabilities and cash outflows for leases, refer to note 14;
for expense relating to short-term leases and leases of low-value assets, refer to note 4.
Other leases include motor vehicles, office equipment and fixtures and fittings.
If at the reporting date the fair values of the acquiree’s identifiable assets, liabilities and contingent liabilities
can only be established provisionally, then these values are used. Adjustments to the fair values can be made
within 12 months of the acquisition date and are taken as adjustments to goodwill.
Acquisitions between 1 January 2004 and 31 December 2009
For acquisitions between 1 January 2004 and 31 December 2009, goodwill represents the excess of the cost
of the acquisition over the Group’s interest in the recognised amount (generally fair value) of the identifiable
assets, liabilities and contingent liabilities of the acquiree.
Transaction costs, other than those associated with the issue of debt or equity securities, that the Group
incurred in connection with business combinations were capitalised as part of the cost of the acquisition.
The Group has taken advantage of the exemption permitted by IFRS 1 First-Time Adoption of International
Financial Reporting Standards and has not restated goodwill on acquisitions prior to 1 January 2004, the date
of transition to IFRS. In respect of acquisitions prior to 1 January 2004, goodwill represents the amount
recognised under the Group’s previous accounting framework.
Other intangible assets
When the Group makes an acquisition, management review the business and assets acquired to determine
whether any intangible assets should be recognised separately from goodwill. If, based on management’s
judgement, such an asset is identified, then it is valued by discounting the probable future cash flows expected
to be generated by the asset, over the estimated life of the asset. Where there is uncertainty over the amount
of economic benefit and the useful life, this is factored into the calculation.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 19
Intangibles
The intangibles employed by the business are analysed below:
Other intangible assets
Goodwill
£m
Customer
relationships
£m
Technology/
Know-how
and trade
names
£m
Other
acquisition
intangibles
£m
Computer
software
£m
Total other
intangible
assets
£m
Cost
At 1 January 2021
Exchange adjustments
Additions
Disposal
Businesses acquired (note 10)
1,360.1
(9.5)
–
–
413.3
At 31 December 2021
1,763.9
Accumulated amortisation
At 1 January 2021
Exchange adjustments
Charge for the year
Disposal
At 31 December 2021
Net book value at
524.2
(1.7)
–
–
522.5
433.8
(2.5)
–
–
65.0
496.3
311.7
(1.7)
17.7
–
327.7
59.9
(0.1)
–
–
37.6
97.4
15.4
0.2
10.3
–
25.9
29.4
(0.4)
–
–
0.2
29.2
25.1
(0.5)
1.3
–
25.9
227.3
(0.9)
19.4
(5.8)
5.7
245.7
118.5
(0.8)
18.7
(5.8)
130.6
750.4
(3.9)
19.4
(5.8)
108.5
868.6
470.7
(2.8)
48.0
(5.8)
510.1
31 December 2021
1,241.4
168.6
71.5
3.3
115.1
358.5
9 Goodwill and other intangible assets Continued
Intangible assets arising on acquisitions and computer software are stated at cost less accumulated
amortisation and accumulated impairment losses. Identifiable intangibles are those which can be sold
separately or which arise from legal rights regardless of whether those rights are separable, and which
have finite useful lives.
Amortisation is charged to the income statement on a straight-line basis over the estimated useful lives.
The estimated useful lives are as follows:
Computer software
Customer relationships
Technology and know-how
Trade names
Licences
Covenants not to compete
Up to 7 years
Up to 20 years
Up to 15 years
Up to 18 years
Contractual life
Contractual life
Impairment
Goodwill is not subject to amortisation and is tested annually for impairment and when circumstances indicate
that the carrying value may be impaired. Goodwill is also tested for impairment in the year of any acquisition.
Other intangible assets are subject to amortisation and are reviewed for impairment whenever events or
changes in circumstances indicate that the amount carried in the statement of financial position may be less
than its recoverable amount.
Any impairment is recognised in the income statement within operating costs. Impairment is determined for
goodwill by assessing the recoverable amount of each asset or group of assets, i.e. CGU, to which the goodwill
relates. A CGU represents an asset grouping at the lowest level for which there are separately identifiable cash
flows.
The recoverable amount of an asset or a CGU is the greater of its fair value less costs to sell and value in use.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the
asset. The estimation process is complex due to the inherent risks and uncertainties and if different estimates
were used this could materially change the projected value of the cash flows. An impairment loss in respect of
goodwill is not reversed.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents
20
9 Goodwill and other intangible assets Continued
Other intangible assets
Goodwill
£m
Customer
relationships
£m
Technology/
Know-how
and trade
names
£m
Other
acquisition
intangibles
£m
Computer
software
£m
Total other
intangible
assets
£m
Cost
At 1 January 2022
Exchange adjustments
Additions
Transfers
Disposal
Businesses acquired (note 10)
1,763.9
139.2
–
5.8
–
66.6
At 31 December 2022
1,975.5
Accumulated amortisation
At 1 January 2022
Exchange adjustments
Charge for the year
Disposal
Impairment
At 31 December 2022
Net book value at
522.5
34.6
–
–
–
557.1
496.3
38.8
–
–
–
12.1
547.2
327.7
23.0
22.2
–
–
372.9
97.4
8.7
–
2.9
–
3.2
112.2
25.9
2.7
11.3
–
–
39.9
29.2
2.0
–
–
–
–
31.2
25.9
1.7
1.3
–
–
28.9
245.7
21.7
20.4
–
(5.3)
–
868.6
71.2
20.4
2.9
(5.3)
15.3
282.5
973.1
130.6
10.0
20.3
(5.3)
12.9
168.5
510.1
37.4
55.1
(5.3)
12.9
610.2
31 December 2022
1,418.4
174.3
72.3
2.3
114.0
362.9
Other intangible assets
Computer software additions of £20.4m (2021: £19.4m) relates to separately acquired computer software
of £6.9m (2021: £7.8m) and internally developed intangible assets of £13.5m (2021: £11.6m).
The other acquisition intangibles net book value of £2.3m (2021: £3.3m) consists of guaranteed income,
order backlog, licences and non-compete covenants.
The average remaining amortisation period for customer relationships is seven years (2021: eight years).
As a result of the Group’s cost reduction programme initiated in 2022, there were two individual technology
assets no longer in use which resulted in an impairment of £12.9m (2021: £nil) with the cost recognised in SDI
as a restructuring cost (see note 3).
Computer software net book value of £114.0m (2021: £115.1m) includes software in construction of £42.8m
(2021: £59.3m). Research and development expenditure of £37.6m (2021: £27.1m) was recognised as an
expense in the year.
Goodwill
Goodwill arising from acquisitions in the current and prior year has been allocated to reportable segments
as follows:
Products
Trade
Resources
At 31 December
2022
£m
–
–
66.6
66.6
2021
£m
412.9
0.4
–
413.3
The total carrying amount of goodwill by CGU is as follows, which is also used for the assessment of the
Group’s impairment review:
Industry Services
Business Assurance
Food & AgriWorld
Caleb Brett
Government & Trade Services
Minerals
Softlines
Hardlines
Electrical & Connected World
Transportation Technologies
Building & Construction
Chemicals & Pharma
2022 pre-tax
discount rate
2022
£m
2021
£m
9.0%
9.3%
9.3%
9.9%
9.3%
10.2%
9.2%
9.1%
9.2%
9.2%
9.4%
10.2%
83.4
715.6
44.0
58.1
0.8
38.8
6.1
8.8
93.4
46.9
238.2
84.3
14.4
663.3
39.0
53.7
0.8
37.0
6.1
7.8
85.7
42.4
212.2
79.0
Net book value at 31 December*
1,418.4
1,241.4
*
All goodwill is recorded in local currency. Additions during the year are converted at the exchange rate on the date of the transaction and the
goodwill at the end of the year is stated at closing exchange rates.
Impairment review
In order to determine whether impairments are required, the Group estimates the recoverable amount of
each CGU. The calculation is based on projecting future cash flows over a five-year period and using a terminal
value to incorporate expectations of growth thereafter. The long-term growth rate is used in the perpetuity
calculations. A discount factor is applied to obtain a value in use which is the recoverable amount. Goodwill
arising in year from acquisitions is assessed for impairment separately from the above CGUs and on an
acquisition-by-acquisition basis. There was no impairment of goodwill for Clean Energy Associates, LLC (‘CEA’)
from the date of acquisition to 31 December 2022. There would be no impact on the impairment review
through the inclusion of CEA within the CGU review. No impairments were required on goodwill arising in
2022 (2021: No impairments).
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 9 Goodwill and other intangible assets Continued
The calculation of the value in use includes assessment of long-term growth rates and discount rates.
Long-term growth rates predict growth beyond the Group’s planning cycle, and range from 1.7% to 2.6%
(2021: 1.7% to 2.6%). The discount rate for each CGU is based on the Group’s weighted average cost of capital
adjusted for the risks specific to the CGU. Pre-tax discount rates ranged from 9.0% to 10.2% (2021: 8.1% to
10.4%). The underlying cashflows include consideration of the potential impact of inflation.
Key assumptions
The key assumptions include the rate of revenue and profit growth within each of the territories and business
lines in which the Group operates. These are based on the Group’s approved budget and five-year strategic
plan. Finally, the discount rate used to bring the cash flow back to a present value varies depending on the
location of the operation and the nature of the operations. The estimated future cash flows are discounted to
their present value using a discount rate that reflects current market assessments of the time value of money
and the risks specific to the asset.
Sensitivity analysis
None of the reasonable downside sensitivity scenarios on key assumptions would cause the carrying amount
of each CGU to exceed its recoverable amount. The sensitivities modelled by management include:
(i) Assuming revenues decline each year by 1% in 2023 to 2027 from the 2023 budgeted revenues, with
margins increasing with base assumptions.
(ii) Assuming zero growth in operating profit margins in 2023 to 2027 with revenues increasing per base
assumptions.
(iii) Assuming an increase in the discount rates used by 1%.
Management considers that the likelihood of any or all of the above scenarios occurring is low.
10 Acquisitions
Acquisitions in 2022
On 1 August 2022 the Group acquired Clean Energy Associates, LLC (‘CEA’) a market-leading independent
provider of Quality Assurance, supply chain traceability and technical services to the fast-growing solar energy
and energy storage sectors with a headquarters in the USA and an operation based in China, for a purchase
price of US$112.4m (£92.2m). Purchase consideration net of cash acquired was US$96.1m (£78.8m). The
purchase price includes cash consideration of £79.3m and a further contingent consideration payable of
£12.9m. Goodwill of £66.6m was generated in this purchase.
The acquisition of CEA is in line with our 5x5 strategy, which aims to further strengthen our TQA value
proposition and expand our presence in attractive markets with long-term growth opportunities. CEA will
strengthen Intertek’s assurance offering by creating a truly end-to-end value proposition in the solar energy
value chain for customers globally.
21
Provisional details of the net assets acquired and fair value adjustments are set out in the following tables.
These analyses are provisional and amendments may be made to these figures in the 12 months following
the date of acquisition.
Clean Energy Associates LLC
Total
Property, plant and equipment
Goodwill
Other intangible assets
Trade and other receivables
Trade and other payables
Provisions for liabilities and charges
Deferred tax liabilities
Net assets acquired (net of cash acquired)
2022
Provisional
fair value to
Group on
acquisition
£m
0.1
66.6
15.3
5.9
(5.5)
–
(3.6)
78.8
Goodwill and intangible assets
The total goodwill arising on acquisitions made during 2022 was £66.6m, of which £nil is expected to be
deductible for tax purposes. The goodwill arising represents the value of the assembled workforce and the
benefits the Group expects to gain from increasing its presence in the relevant sectors in which the acquired
businesses operate. The intangible assets of £15.3m primarily represent the value of customer relationships,
trade names and technology. The final values will be calculated within 12 months following the date of
acquisition. The deferred tax thereon was £3.6m.
Consideration paid
The total cash consideration for the acquisitions in the year was £79.3m (2021: £496.7m), with further
contingent consideration payable of £12.9m (2021: £0.1m), which is recognised in note 13. Cash consideration
includes cash acquired of £13.4m (2021: £15.8m). The estimated purchase price net of cash was £65.9m
(2021: £480.9m), of which £2.7m has been paid in January 2023.
Contribution of acquisitions to revenue and profits
In total, acquisitions made during 2022 contributed revenues of £11.9m (2021: £44.2m) and a statutory
net profit after tax of £2.1m (2021: £2.4m) from the date of acquisition to year-end. The Group revenue and
statutory profit after tax for the year ended 31 December 2022 would have been £3,209.5m and £307.4m
respectively if the acquisitions were assumed to have been made on 1 January 2022.
Acquisition-related costs
Acquisition-related costs of £1.3m are included in operating costs in the consolidated income statement as
an SDI (see note 3) and in operating cash flows in the consolidated statement of cash flows.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 10 Acquisitions Continued
Acquisitions in 2021
On 7 September 2021 the Group acquired 100% of SAI Global Assurance (‘SAI’), a leading provider of assurance
services based predominantly in Australia, for a purchase price of AU$868.9m (£450.1m net of cash acquired)
generating goodwill of £388.4m. The Assurance division provides audit, inspection and certification services
and is similar to our existing Business Assurance line. The Standards division aggregates and distributes
standards via its online platform. The acquisition of SAI is in line with our 5x5 strategy, which aims to further
strengthen our TQA value proposition and expand our presence in attractive markets with long-term growth
opportunities.
On 1 July 2021 the Group acquired the trade and assets of Apras Sicea France (‘ASF’), a specialist in inspection
and testing of petroleum, petrochemical and related products, for a purchase price of EUR0.6m (£0.5m net of
cash acquired) generating goodwill of £0.4m.
On 19 July 2021 the Group acquired 100% of JLA Brasil Laboratório de Análises de Alimentos S.A. (‘JLA’), a
market-leading independent provider of Food, Agri and Environmental testing solutions, for a purchase price
of BRL218.3m (£30.4m net of cash acquired) generating goodwill of £24.5m.
The net assets acquired and fair value adjustments are set out in the following tables.
22
Others
Total
Property, plant and equipment
Goodwill
Other intangible assets
Inventories
Trade and other receivables
Trade and other payables
Deferred tax liabilities
Net assets acquired
2021
Fair value to
Group on
acquisition
£m
2.4
24.9
8.9
0.1
0.7
(3.1)
(3.0)
30.9
The provisional fair values disclosed in 2021 have been updated for SAI, resulting in an increase in goodwill
of £5.8m and movements in property, plant and equipment, trade and other receivables, trade and other
payables and deferred tax liabilities. These fair value adjustments were made in the 12 months following the
acquisitions and are now final.
SAI Global Standards and Assurance
Total
Property, plant and equipment
Goodwill
Other intangible assets
Trade and other receivables
Trade and other payables
Provisions for liabilities and charges
Deferred tax liabilities
Minority Interest acquired
Net assets acquired
2021
Fair value to
Group on
acquisition
£m
Key assumptions
The key assumptions in deriving the contingent consideration to be recognised include the weighted
probability of making a payout and the discount rate used to bring the cash flow back to present values.
The discount rates used for the calculation are aligned with the discount rates used for impairment purposes
as set out in note 9.
3.7
388.4
99.6
54.6
(74.9)
(0.1)
(19.5)
(1.7)
450.1
Sensitivity analysis
It is estimated that an increase of 1% in the discount rate used to calculate the contingent consideration would
have decreased the financial liability by £0.2m, and a 1% decrease in the discount rate would have increased
the financial liability by £0.2m. It has also been estimated that an increase of 10% in the probability used to
calculate the contingent consideration would have increased the financial liability by £1.3m, whilst a decrease
of 10% in the probability used would have decreased the financial liability by £1.3m.
11 Trade and other receivables
Accounting policy
Trade receivables are recognised initially at the value of the invoice sent to the customer and subsequently at
the amounts considered recoverable (amortised cost). Estimates are used in determining the level of receivables
that will not, in the opinion of the Directors, be collected. The Group applies the simplified approach permitted
by IFRS 9, which requires the use of the lifetime expected loss provision for all receivables, including contract
assets. The provision calculations are based on historic credit losses and forward-looking data, namely specific
country-risk classifications with higher default rates applied to older balances. This approach is followed for all
receivables unless there are specific circumstances, such as the bankruptcy of a customer or emerging market
risks, which would render the receivable irrecoverable and therefore require a specific provision. A provision is
made against trade receivables and contract assets until such time as the Group believes the amount to be
irrecoverable, after which the trade receivable or contract assets balance is written off.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 23
11 Trade and other receivables Continued
Trade and other receivables
Trade and other receivables are analysed below:
The movement in the allowance for impairment in respect of trade receivables and contract assets during the
year was as follows:
Trade receivables
Contract assets
Other receivables
Prepayments
Total trade and other receivables
Impairment allowance for doubtful trade receivables and contract assets
Current
2022
£m
519.2
100.4
59.4
47.4
726.4
Current
2021
£m
Non-current
2022
£m
Non-current
2021
£m
450.5
108.5
57.9
45.0
661.9
13.1
–
8.4
–
21.5
–
–
–
–
–
At 1 January
Exchange differences
Acquisitions
Net impairment loss/(gain) recognised
Receivables written off
At 31 December
2022
£m
15.4
1.9
0.2
9.5
(11.4)
15.6
2021
£m
24.2
(0.6)
2.1
(4.5)
(5.8)
15.4
Sensitivity analysis
Trade receivables and contract assets are assessed for impairment using a calculated credit loss assumption.
A 0.25% variance in the assumed credit risk factor would impact impairment by £2.2m. There were no material
individual impairments of trade receivables or contract assets.
Trade receivables and contract assets are shown net of allowance for impairment losses of £13.9m (2021:
£13.8m) and £1.7m (2021: £1.6m) respectively. Net impairment on trade receivables and contract assets
charged as part of operating costs was £9.4m (2021: £4.5m credit) and £0.1m (2021: £nil) respectively.
There is no material difference between the above amounts for trade and other receivables and their fair value,
due to their short-term duration. There is no concentration of credit risk with respect to trade receivables as
the Group has a large number of customers who are internationally dispersed. Non-current receivables are
discounted to the present value using an appropriate discount rate.
The ageing of trade receivables and contract assets at the reporting date was as follows:
Under 3 months
Between 3 and 6 months
Between 6 and 12 months
Over 12 months
Gross trade receivables and contract assets
Allowance for impairment
Trade receivables and contract assets, net of allowance
2022
£m
514.9
85.4
27.9
20.1
648.3
(15.6)
632.7
2021
£m
457.6
46.6
20.8
49.4
574.4
(15.4)
559.0
Included in trade receivables under three months of £418.4m (2021: £384.6m) are trade receivables of
£365.2m (2021: £340.7m) that are not yet due for payment.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 24
12 Trade and other payables
Accounting policy
Trade payables
Trade payables are recognised at the value of the invoice received from a supplier. The carrying value of trade
payables is considered approximate to fair value.
13 Provisions
Accounting policy
A provision is recognised in the balance sheet when the Group has a present legal or constructive obligation
that can be estimated reliably as a result of a past event, and it is probable that an outflow of economic
benefits will be required to settle the obligation.
Trade and other payables
Trade and other payables are analysed below:
Provisions
Trade payables
Other payables
Accruals
Contract liabilities
Total trade and other payables
Current
2022
£m
172.1
85.9
308.4
156.8
723.2
Current
2021
£m
Non-current
2022
£m
Non-current
2021
£m
153.4
83.4
296.2
134.8
667.8
0.7
19.5
7.8
6.6
34.6
0.9
15.5
9.4
6.1
31.9
The Group’s exposure to liquidity risk related to trade payables is disclosed in note 14. £113.3m of contract
liabilities at the end of 2021 was recognised in revenue in 2022 (2021: £80.5m).
Other payables include revenue taxes, interest payable and retirement liabilities.
Contract liabilities consist of consideration received in advance of the Group transferring the related good
or service to the client.
In one part of the Group an arrangement is available that allows payment terms to suppliers to be extended
by up to 60 days. At 31 December 2022, this arrangement was applicable to trade payables totalling £1.6m
(2021: £2.8m).
At 1 January 2022
Exchange adjustments
Provided in the year:
in respect of current year acquisitions
in respect of prior year acquisitions
Released during the year
Utilised during the year
At 31 December 2022
Included in:
Current liabilities
Non-current liabilities
At 31 December 2022
Contingent
consideration
£m
0.3
0.3
–
16.1
0.6
–
(0.1)
17.2
2.7
14.5
17.2
Claims
£m
3.7
0.3
5.5
–
–
(0.9)
(3.6)
5.0
5.0
–
5.0
Other
£m
9.7
0.1
18.2
–
–
(3.1)
(16.7)
8.2
8.1
0.1
8.2
Total
£m
13.7
0.7
23.7
16.1
0.6
(4.0)
(20.4)
30.4
15.8
14.6
30.4
The maximum contingent consideration, on a discounted basis, that could be paid in relation to acquisitions is
£141.6m. Further detail on the timing of the cash flow can be found in note 14. The contingent consideration is
a financial liability discounted to the present value of the redemption amount held at fair value through profit
and loss with the measurement basis disclosed in note 14. The £2.7m current liability is the closing statement
payment for the CEA acquisition which has been paid in January 2023.
The Group is involved in various claims and lawsuits incidental to the ordinary course of its business. The
outcome of such litigation and the timing of any potential liability cannot be readily foreseen, as it is often
subject to legal proceedings. Based on information currently available, the Directors consider that the cost
to the Group of an unfavourable outcome arising from such litigation is unlikely to have a materially adverse
effect on the financial position of the Group in the foreseeable future.
The provision for claims of £5.0m (2021: £3.7m) represents an estimate of the amounts payable in connection
with identified claims from customers, former employees and other plaintiffs and associated legal costs. The
timing of the cash outflow relating to the provisions is uncertain but is likely to be within one year. Details of
contingent liabilities in respect of claims are set out in note 22.
The other provision of £8.2m (2021: £9.7m) includes restructuring provisions. The timing of the cash outflow
is uncertain, but is likely to be within one year.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents
25
14 Borrowings and financial instruments
Accounting policy
Net financing costs
Net financing costs comprise interest expense on borrowings; interest expense on tax balances; facility
fees; interest receivable on funds invested; interest income and expense relating to pension assets and
liabilities and lease interest expense under IFRS 16; net foreign exchange gains or losses on financial assets
or liabilities; unrealised market or fair value gains or losses on financial assets or liabilities, including contingent
consideration; and gains and losses on hedging instruments that are recognised in the income statement.
Interest income and interest expense are recognised as they accrue using the effective interest rate method.
As permitted by IAS 7, interest paid is classified within operating cash flows and interest received is classified
within investing cash flows.
Hedging
Hedge of monetary assets and liabilities
Where a derivative financial instrument is used economically to hedge the foreign exchange exposure
of a recognised monetary asset or liability, no hedge accounting is applied and any gain or loss on the
hedging instrument is recognised in the income statement in the same caption as the foreign exchange
on the related item.
Hedge of net investment in foreign operations
The Group is exposed to foreign exchange risk exposure arising from its net investment in foreign currency
operations and net assets. To the extent that we have debt, we hold it in currencies that hedge the foreign
exchange risks from our net investments.
The portion of the gain or loss on an instrument designated as a hedge of a net investment in a foreign
operation that is determined to be an effective hedge is recognised directly in equity in the translation reserve.
The value in relation to the hedge instrument that is held within the cumulative foreign currency translation
reserve is recycled through the income statement when the hedged subsidiary is disposed of. If the instrument
is no longer deemed effective, then future movements in fair value are posted to the income statement.
Cash flow hedges
Cash flow hedges comprise derivative financial instruments designated in a hedging relationship to manage
interest rate risk and foreign exchange risk to which the cash flows of certain assets and liabilities are exposed.
The Group is exposed to the variability in cash flows arising from the foreign exchange risk exposures.
The effective portion of changes in the fair value of a derivative that is designated and qualifies for hedge
accounting is recognised in other comprehensive income. The value in relation to the hedge instrument that
is held within the cumulative cash flow hedge reserve (disclosed within other reserves) is recycled through
the income statement when the hedged item impacts the income statement. If the instrument is no longer
deemed effective, then future movements in fair value are posted to the income statement.
Interest Rate Benchmark Reform
LIBOR was discontinued as a published benchmark rate for some currencies as of 1 January 2022. The Group
has reviewed and renegotiated significant borrowing and commercial contracts to replace LIBOR references
with alternative benchmark rates, as needed. USD LIBOR will remain a reference rate for contracts that have
a final fixing date in advance of USD LIBOR cessation on 30 June 2023.
Trade and other receivables
Trade and other receivables are recognised initially at fair value and subsequently at amortised cost less
impairment losses (including bad debt provision).
Cash and cash equivalents and net debt
Cash and cash equivalents on the balance sheet comprise cash at bank and in hand and short-term deposits
with original maturities of less than 90 days which are subject to an insignificant risk of changes in value. In the
consolidated statement of cash flows, net cash and cash equivalents comprise cash and cash equivalents, as
defined above, net of bank overdrafts. Net financial debt comprises borrowings less cash and cash equivalents
and total net debt is net financial debt plus the IFRS 16 lease liability.
Non-derivative financial liabilities
Trade and other payables are recognised initially at fair value and subsequently at their amortised cost.
Interest-bearing borrowings are initially recognised at fair value less transaction costs. Subsequent to initial
recognition, interest-bearing borrowings are stated at amortised cost with any difference between cost and
redemption value being recognised in the income statement over the period of the borrowings on an effective
interest basis.
Put options held by non-controlling interests that arise on acquisition are recognised initially at the present
value of the redemption amount. They are subsequently measured at amortised cost using the effective
interest method. The discount is unwound through SDIs as a finance charge.
Derivative financial instruments
The Group uses derivative financial instruments, including foreign currency forwards, to hedge economically
its exposure to foreign exchange risks. In accordance with its treasury policy, the Group does not hold or issue
derivative financial instruments for speculative purposes.
Derivative financial instruments are recognised initially and subsequently at fair value; attributable
transaction costs are recognised in profit or loss when incurred. The gain or loss on remeasurement to
fair value at each period end is recognised immediately in the income statement except where derivatives
qualify for hedge accounting.
The fair value of foreign currency forwards is estimated using present value of future cash flows based on
the forward exchange rates at the balance sheet date.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 26
14 Borrowings and financial instruments Continued
Impairment
A financial asset is assessed for impairment at each reporting date by application of an expected loss model
in line with IFRS 9 requirements.
Analysis of net debt
Net financing costs
Net financing costs are shown below:
Recognised in income statement
Finance income
Interest on bank balances
Total finance income
Finance expense
Interest on borrowings
Net pension interest income/(cost) (note 16)
Foreign exchange differences on revaluation of net monetary assets and liabilities
Leases – IFRS 16
Facility fees and other*
Total finance expense*
Net financing costs*
*
Includes £0.7m cost (2021: £8.6m income) relating to SDIs.
Cash and cash equivalents per the statement of financial position
Overdrafts
Cash per the statement of cash flows
2022
£m
2021
£m
The components of net debt are outlined below:
2022
£m
321.6
(0.9)
320.7
2021
£m
265.9
(1.9)
264.0
2.2
2.2
(29.6)
0.1
8.6
(10.2)
(3.7)
(34.8)
(32.6)
1.5
1.5
(17.7)
(0.1)
2.3
(9.0)
3.2
(21.3)
(19.8)
Cash
264.0
51.7
–
5.0
320.7
1 January
2022
£m
Cash flow
£m
Non-cash
movements
£m
Exchange
adjustments
£m
31 December
2022
£m
Borrowings:
Revolving credit facility US$850m 2027
Senior notes US$140m 2022
Acquisition facility ‘B’ AU$264.1m 2022
Acquisition facility ‘B’ US$290.7m 2022
Senior notes US$160m 2023
Acquisition facility ‘A’ AU$88.0m 2023
Acquisition facility ‘A’ US$96.9m 2023
Senior notes US$125m 2024
Senior notes US$120m 2025
Senior notes US$75m 2026
Senior notes US$150m 2027
Senior notes US$165m 2028
Senior notes US$165m 2029
Senior notes US$160m 2030
Other*
Total borrowings
(65.9)
(103.8)
(141.9)
(215.5)
(118.6)
(47.3)
(72.0)
(92.7)
(88.8)
(55.5)
–
–
–
–
4.7
(997.3)
71.9
103.0
143.7
218.2
(0.1)
–
0.2
–
(0.2)
(0.1)
(109.4)
(123.8)
(123.8)
(120.0)
–
59.6
Total net financial debt
(733.3)
111.3
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(1.5)
(1.5)
(1.5)
(6.0)
0.8
(1.8)
(2.7)
(14.4)
(2.1)
(8.8)
(11.3)
(10.8)
(6.8)
(15.4)
(13.5)
(13.5)
(13.1)
–
–
–
–
–
(133.1)
(49.4)
(80.6)
(104.0)
(99.8)
(62.4)
(124.8)
(137.3)
(137.3)
(133.1)
3.2
(119.4)
(1,058.6)
(114.4)
(737.9)
Lease liabilities
Total net debt
(292.3)
81.4
(92.4)
(18.9)
(322.2)
(1,025.6)
192.7
(93.9)
(133.3)
(1,060.1)
*
Includes other uncommitted borrowings of £0.8m (2021: £0.8m) and facility fees of £4.0m (2021: £5.5m).
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 27
14 Borrowings and financial instruments Continued
Borrowings
Borrowings are split into current and non-current as outlined below:
1 January
2021
£m
Cash flow
£m
Non-cash
movements
£m
Exchange
adjustments
£m
31 December
2021
£m
Cash
183.4
86.6
Borrowings:
Revolving credit facility US$850m 2027
Senior notes US$15m 2021
Senior notes US$140m 2022
Acquisition facility ‘B’ AU$264.1m 2022
Acquisition facility ‘B’ US$290.7m 2022
Senior notes US$160m 2023
Acquisition facility ‘A’ AU$88.0m 2023
Acquisition facility ‘A’ US$96.9m 2023
Senior notes US$125m 2024
Senior notes US$120m 2025
Senior notes US$75m 2026
Other*
Total borrowings
Total net financial debt
Lease liabilities
Total net debt
(135.5)
(11.1)
(103.7)
–
–
(118.5)
–
–
(92.6)
(88.8)
(55.5)
2.4
61.5
10.9
–
(142.0)
(210.9)
–
(47.3)
(70.3)
–
–
–
(0.8)
(603.3)
(398.9)
(419.9)
(312.3)
–
–
–
–
–
–
–
–
–
–
–
–
3.1
3.1
3.1
(6.0)
264.0
8.1
0.2
(0.1)
0.1
(4.6)
(0.1)
–
(1.7)
(0.1)
–
–
–
1.8
(4.2)
3.9
(65.9)
–
(103.8)
(141.9)
(215.5)
(118.6)
(47.3)
(72.0)
(92.7)
(88.8)
(55.5)
4.7
(997.3)
(733.3)
(292.3)
(224.2)
70.4
(142.4)
(644.1)
(241.9)
(139.3)
(0.3)
(1,025.6)
Senior term loans and notes
Other borrowings
Total borrowings
Analysis of debt
Debt falling due:
In one year or less
Between one and two years
Between two and five years
Over five years
Total borrowings
Current
2022
£m
263.1
(1.6)
261.5
Current
2021
£m
Non-current
2022
£m
Non-current
2021
£m
461.2
(1.1)
460.1
798.7
(1.6)
797.1
540.8
(3.6)
537.2
2022
£m
2021
£m
261.5
103.0
286.0
408.1
1,058.6
460.1
236.4
235.3
65.5
997.3
Description of borrowings
Total undrawn committed borrowing facilities as at 31 December 2022 were £707.3m (2021: £564.2m).
US$850m revolving credit facility
The Group has a US$850m multi-currency revolving credit facility, which is the Group’s principal facility and in
December 2021 was extended from 2026-2027. The impact of this was a transfer of £65.9m from borrowings
due to be repaid between two and five years to borrowings due to be repaid over five years. Advances under
the facility bear interest at a rate equal to a risk-free rate, or their local currency equivalent, plus a margin,
depending on the Group’s financial leverage. Drawings under this facility at 31 December 2022 were £nil
(2021: £65.9m).
US$692m acquisition facility
In May 2021 the Group agreed a US$692m multi-currency acquisition facility to finance the acquisition of
SAI Global with £357.4m repaid in March 2022 and the balance of £130.0m repayable on 7 September 2023.
Advances under the facility bear interest at a rate equal to USD LIBOR or AUD BBSW, plus a margin. Drawings
under this facility at 31 December 2022 were £130.0m (2021: £476.7m).
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 28
14 Borrowings and financial instruments Continued
Private placement bonds
In October 2011 the Group issued US$140m of senior notes repaid on 18 January 2022 at a fixed annual
interest rate of 3.75% and US$105m repayable on 18 January 2024 at a fixed annual interest rate of 3.85%.
Credit risk
Exposure to credit risk
Credit risks arise mainly from the possibility that customers may not be able to settle their obligations as
agreed. The Group monitors the creditworthiness of customers on an ongoing basis. The Group’s credit risk is
diversified due to the large number of entities, industries and regions that make up the Group’s customer base.
In February 2013 the Group issued US$80m of senior notes. These notes were issued in two tranches with
US$40m repaid on 14 February 2023 at a fixed annual interest rate of 3.10% and US$40m repayable on
14 February 2025 at a fixed annual interest rate of 3.25%. The repayment on 14 February 2023 was funded
from the existing revolving credit facility.
In July 2014 the Group issued US$110m of senior notes. These notes were issued in four tranches with
US$15m repaid on 31 July 2021 at a fixed annual interest rate of 3.37%, US$20m repayable on 31 July 2024
at a fixed annual interest rate of 3.86%, US$60m repayable on 31 October 2026 at a fixed annual interest
rate of 4.05% and US$15m repayable on 31 December 2026 at a fixed annual interest rate of 4.10%.
The carrying amount of financial assets represents the maximum credit exposure. At the reporting date this
was as follows:
Trade receivables, net of allowance (note 11)
Cash and cash equivalents
Total
2022
£m
532.3
320.7
853.0
2021
£m
450.5
264.0
714.5
In December 2020 the Group issued US$200m of senior notes. These notes were issued in two tranches with
US$120m repayable on 2 December 2023 at a fixed annual interest rate of 1.97% and US$80m repayable on
2 December 2025 at a fixed annual interest rate of 2.08%.
The maximum exposure to credit risk for trade receivables at the reporting date by geographic region was
as follows:
In December 2021 the Group issued US$640m of senior notes. These notes were issued in four tranches
with US$150m repayable on 13 January 2027 at a fixed annual interest rate of 2.24%, US$165m repayable
on 15 March 2028 at a fixed annual interest rate of 2.33%, US$165m repayable on 15 March 2029 at a
fixed annual interest rate of 2.47% and US$160m repayable on 15 March 2030 at a fixed annual interest
rate of 2.54%.
Lease liabilities
Undiscounted lease liabilities are split into current and non-current as outlined below:
Asia Pacific
Americas
Europe, Middle East and Africa
Total
2022
£m
141.4
205.9
185.0
532.3
2021
£m
130.2
175.9
144.4
450.5
Analysis of lease liabilities falling due:
Current:
Repayable in less than 1 year
Non-current:
Repayable in 1–2 years
Repayable in 2–5 years
Repayable in more than 5 years
Total lease liabilities
2022
£m
2021
£m
80.5
71.8
61.2
106.5
161.0
409.2
56.6
98.2
150.5
377.1
Financial risks
Details of the Group’s treasury controls, exposures and the policies and processes for managing capital
and credit, liquidity, interest rate and currency risk are set out below and in the Financial review in Book one,
pages 28 to 33.
Counterparty risk
Cash and cash equivalents and available borrowing facilities are at risk in the event that the counterparty is not
able to meet its obligations in regards to the cash held or facilities available to the Group. The Group also enters
into transactions with counterparties in relation to derivative financial instruments. If the counterparty was
not able to meet its obligations, the Group may be exposed to additional foreign currency or interest rate risk.
Counterparty credit risk inherent in all hedge relationships is monitored throughout the period of the hedge
but this risk is not expected to be significant.
The Group, wherever possible, enters into arrangements with counterparties who have a robust credit
standing, which the Group defines as a financial institution with a credit rating of at least investment grade.
The Group has existing relationships with a number of banks that meet this criterion, and seeks to use their
services wherever possible while avoiding excessive concentration of credit risk. Given the diverse geographic
nature of the Group’s activities, it is not always possible to use a relationship bank. Therefore the Group has set
limits on the level of deposits to be held at non-relationship banks to minimise the risk to the Group. It is also
Group policy to remit any excess funds from local entities back to Intertek Group Treasury in the UK. Given
the controls in place and based on a current assessment of our banking relationships, management does not
expect any counterparty to fail to meet its obligations.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 29
2021
Non-derivative financial
liabilities/(assets)
Senior term loans and notes
Other loans
Trade payables (note 12)
Lease liabilities
Contingent consideration
(note 13)
Derivative financial
liabilities/(assets)
Foreign currency forwards
Outflow
Inflow
Carrying
amount
£m
Contractual
cash flows
£m
Six months
or less
£m
6–12
months
£m
1–2 years
£m
2–5 years
£m
More than
five years
£m
1,002.0
(4.7)
154.3
292.3
1,035.3
0.8
154.3
377.1
112.5
–
149.5
37.6
366.2
0.8
3.9
34.2
243.5
–
0.7
56.6
247.4
–
0.2
98.2
65.7
–
–
150.5
0.3
0.3
–
0.1
–
0.2
–
1,444.2
1,567.8
299.6
405.2
300.8
346.0
216.2
–
(0.8)
(0.8)
928.3
(929.1)
928.3
(929.1)
(0.8)
(0.8)
–
–
–
–
–
–
–
–
–
–
–
–
Total
1,443.4
1,567.0
298.8
405.2
300.8
346.0
216.2
Interest rate risk
The Group’s objective is to manage the risk to the business from movements in interest rates, and to provide
stability and predictability of the near-term (12-month horizon) interest expense.
Sensitivity
At 31 December 2022, it is estimated that the impact on variable rate net debt of a general increase of 3% in
interest rates would be a decrease in the Group’s profit before tax of approximately £11.6m (2021: £9.6m).
This analysis assumes all other variables remain constant.
14 Borrowings and financial instruments Continued
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its obligations as and when they fall due.
The Group’s policy is to:
• ensure sufficient liquidity is available to Group companies in the amounts, currencies and locations required
to support the Group’s operations; and
• ensure the Group has adequate available sources of funding to protect against unforeseen internal and
external events.
To ensure this policy is met, the Group monitors cash balances daily, projects cash requirements on a rolling
basis and funds itself using debt instruments with a range of maturities.
The following are the undiscounted contractual cash flows of financial liabilities/(assets) including interest
(for floating rate instruments, interest payments are based on the interest rate at 31 December):
2022
Non-derivative financial
liabilities/(assets)
Senior term loans and notes
Other loans
Trade payables (note 12)
Lease liabilities
Contingent consideration
Carrying
amount
£m
Contractual
cash flows
£m
Six months
or less
£m
6–12
months
£m
1–2 years
£m
2–5 years
£m
More than
five years
£m
1,061.8 1,170.4
0.8
172.8
409.2
(3.2)
172.8
322.2
47.4
–
164.2
41.4
244.1
–
7.9
39.1
123.4
–
0.7
61.2
337.1
0.2
–
106.5
418.4
0.6
–
161.0
(note 13)
17.2
17.2
2.8
–
0.8
13.6
–
1,570.8 1,770.4
255.8
291.1
186.1
457.4
580.0
Derivative financial
liabilities/(assets)
Foreign currency forwards
Outflow
Inflow
2.8 1,069.7 1,069.7
(1.1) (1,068.0) (1,068.0)
1.7
1.7
1.7
–
–
–
–
–
–
–
–
–
–
–
–
Total
1,572.5 1,772.1
257.5
291.1
186.1
457.4
580.0
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 30
Recognised assets and liabilities
Changes in the fair value of foreign currency forwards that economically hedge monetary assets and liabilities
in foreign currencies, and for which no hedge accounting is applied, are recognised in the income statement.
Cash flow hedge
At 31 December 2021, the Group had AU$264.1m drawn against the US$692m Acquisition Facility, which was
repaid in March 2022.
A proportion of the Australian dollar debt was hedged using a 264m AUD/GBP currency forward contract, that
matured in March 2022, to eliminate changes in the cash flows of the Australian dollar principal repayment
related to changes in foreign exchange rates.
In 2022, a £1.9m gain relating to the Australian dollar hedge was allocated to the income statement.
Hedge of net investment in foreign operations
The Group’s foreign currency denominated loans are designated as a hedge to protect the same amount of net
investment in the Group’s foreign currency operations and net assets, against adverse changes in exchange
rates. The nominal amount of these loans as at 31 December 2022 was £1,061.8m (2021: £845.1m).
189.6m USD/GBP foreign currency forwards were designated as a hedge to protect the same amount of net
investment in the Group’s USD operations and net assets, against adverse changes in exchange rates. The
hedges remained outstanding as at 31 December 2021 and were settled during March 2022.
14 Borrowings and financial instruments Continued
Foreign currency risk
The Group’s objective in managing foreign currency risk is to safeguard the Group’s financial assets from
economic loss due to fluctuations in foreign currencies, and to protect margins on cross currency contracts and
operations. To achieve this, the Group’s policy is to hedge its foreign currency exposures where appropriate.
The net assets of foreign subsidiaries represent a significant portion of the Group’s shareholders’ funds, and
a substantial percentage of the Group’s revenue and operating costs are incurred in currencies other than
sterling. Due to the high proportion of international activity, the Group’s profit is exposed to exchange rate
fluctuations. Two types of risk arise as a result: (i) translation risk, that is, the risk of adverse currency
fluctuations in the translation of foreign currency operations and foreign assets and liabilities into sterling;
and (ii) transaction risk, that is, the risk that currency fluctuations will have a negative effect on the value of
the Group’s commercial cash flows in various currencies.
The foreign currency profiles of cash, trade receivables and payables subject to translation risk and transaction
risk, at the reporting date, were as follows:
2022
Cash
Trade receivables (note 11)
Trade payables (note 12)
2021
Cash
Trade receivables (note 11)
Trade payables (note 12)
Carrying
amount
£m
320.7
532.3
172.8
Carrying
amount
£m
264.0
450.5
154.3
Sterling
£m
US dollar
£m
72.9
37.7
25.6
85.5
216.5
55.7
Chinese
renminbi
£m
Hong Kong
dollar
£m
Other
currencies
£m
42.3
39.5
20.1
0.7
6.5
2.7
119.3
232.1
68.7
Sterling
£m
US dollar
£m
10.7
34.4
15.9
79.3
209.5
55.4
Chinese
renminbi
£m
Hong Kong
dollar
£m
Other
currencies
£m
54.9
40.1
16.7
(0.8)
6.9
2.0
119.9
159.6
64.3
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 14 Borrowings and financial instruments Continued
A foreign exchange loss of £120.0m (2021: £4.0m foreign exchange gain) was recognised in the translation
reserve in equity, reflecting the translation of the Group’s foreign currency denominated loans to sterling
and the impact of changes in fair value of the foreign currency forwards. The Group has the following
hedging instruments:
Other comprehensive income
Nominal
amounts in
local currency
Carrying
value
£m
1 January
2022
£m
FX (gain)/
loss
recycled
to the
income
statement
£m
Fair value
gain/(loss)
deferred
to OCI
£m
Hedges
closed in
year
£m
31
December
2022
£m
2022
Cash flow hedges –
foreign exchange and
interest rate risk
Foreign currency forward
– continuing
Hedges of net investment
in a foreign operation –
foreign exchange risk
Foreign currency forward
– continuing
Forward currency forward
– discontinued
Cross currency interest rate
swaps – discontinued
Foreign currency borrowings
–
1.9
(1.9)
–
–
–
(1.2)
–
–
–
–
–
–
–
–
3.0
(1.8)
–
(19.0)
–
–
31
2021
Cash flow hedges –
foreign exchange and
interest rate risk
Foreign currency forward
Other comprehensive income
Nominal
amounts in
local currency
Carrying
value
£m
1 January
2021
£m
FX (gain)/
loss
recycled
to the
income
statement
£m
Fair value
gain/(loss)
deferred
to OCI
£m
Hedges
closed in
year
£m
31
December
2021
£m
– continuing
AU$264m
(1.8)
Hedges of net investment
in a foreign operation –
foreign exchange risk
Foreign currency forward
– continuing
US$189.6m
3.0
–
–
Cross currency interest rate
swaps – discontinued
Foreign currency borrowings
–
–
(19.0)
– continuing
£845.1m
845.1
(50.4)
Foreign currency borrowings
– discontinued
–
–
(173.2)
846.3
(242.6)
(1.8)
1.8
–
–
–
–
3.0
–
1.0
–
2.2
–
–
–
–
3.0
(19.0)
2.9
(46.5)
(2.9)
(176.1)
–
–
–
–
–
1.2
1.2
–
(19.0)
The foreign currency forwards previously designated in discontinued hedge relationships were disclosed within
other receivables in the statement of financial position.
19.2
(145.5)
(19.2)
(195.3)
Foreign currency denominated loans and their corresponding hedged items are matched and the Group
expects highly effective hedging relationships. Net ineffectiveness on the net investment hedges recognised
in the income statement was nil.
1.8
–
(238.6)
– continuing
£1,061.8m 1,061.8
(46.5)
(118.2)
Foreign currency borrowings
– discontinued
–
–
(176.1)
–
1,061.8
(238.6)
(118.1)
(1.9)
–
(358.6)
The Group entered into AU$264m of foreign currency forwards which paid USD and received AUD; matured
in March 2022. The foreign currency forwards were bifurcated into two relationships: 1) A cash flow hedge
of AU$264m versus GBP foreign currency risk in AUD denominated borrowings; and 2) A net investment
hedge of USD versus GBP foreign currency risk in USD denominated net assets of the Group.
The weighted average exchange rates of the forwards were GBP/USD 1.3209 and GBP/AUD 1.8388.
Hedge ineffectiveness may occur if there are insufficient net assets in foreign currency to match hedging
instruments in the relevant currency.
The hedge ratio for each designation will be established by comparing the quantity of the hedging instrument
and the quantity of the hedged item to determine their relative weighting; for all of the Group’s existing hedge
relationships the hedge ratio has been determined as 1:1.
The carrying values of the hedging instruments; US$1,120.0m senior notes, AUD88.0m and US$96.9m
acquisition facilities are included within borrowings within the statement of financial position.
Fair value gains and losses on the hedging instruments designated in the cash flow and net investment hedges
have been presented as ‘fair value on cash flow hedges’ and ‘net exchange on hedges of net investments in
foreign operations’ respectively within the statement of other comprehensive income.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 14 Borrowings and financial instruments Continued
Foreign exchange gain of £1.9m recycled from the cash flow hedge reserve are presented in interest on
borrowings within finance expenses in the income statement.
Sensitivity
It is estimated that an increase of 10% in the value of sterling against the US dollar and Chinese renminbi
(the main currencies impacting the Group) would have decreased the Group’s profit before tax for 2022
by approximately £20.4m (2021: £24.7m). This analysis assumes all other variables remain constant.
It is estimated that an increase of 10% in the value of sterling against the currencies of the hedging
instruments would have increased OCI by approximately £96.5m (2021: £89.7m) which would be offset
by the retranslation of the Group’s investment in foreign operations in the same currencies. This analysis
assumes all other variables remain constant.
Fair values
The table below provides a comparison of book values and corresponding fair values of all the Group’s financial
instruments by class.
32
15 Capital and reserves
Accounting policy
Dividends
Interim dividends are recognised as a movement in equity when they are paid. Final dividends are reported
as a movement in equity in the year in which they are approved by the shareholders.
Own shares held by the Employee Share Ownership Trust (‘ESOT’)
Transactions of the Group-sponsored ESOT are included in the Group financial statements. In particular,
the Trust’s purchases of shares in the Company are debited directly in equity to retained earnings.
Share capital
Group and Company
Allotted, called up and fully paid:
Ordinary shares of 1p each at start of year
Share awards
2022
number
2022
£m
2021
£m
161,393,127
–
161,393,127
1.6
–
1.6
1.6
1.6
–
1.6
1.6
Book value
2022
£m
Fair value
2022
£m
Book value
2021
£m
Fair value
2021
£m
Ordinary shares of 1p each at end of year
Shares classified in shareholders’ funds
Financial assets
Cash and cash equivalents
Trade receivables (note 11)
Foreign currency forwards*
Total financial assets
Financial liabilities
Interest-bearing loans and borrowings
Trade payables (note 12)
Foreign currency forwards*
Contingent consideration**
320.7
532.3
1.1
854.1
1,058.6
172.8
2.8
17.2
320.7
532.3
1.1
854.1
936.8
172.8
2.8
17.2
264.0
450.5
0.8
715.3
997.3
154.3
–
0.3
264.0
450.5
0.8
715.3
1,003.3
154.3
–
0.3
Total financial liabilities
1,251.4
1,129.6
1,151.9
1,157.9
*
Foreign currency forwards are categorised as Level 2, under which the fair value is measured using inputs other than quoted prices
observable for the asset or liability, either directly or indirectly.
** Contingent consideration is categorised as Level 3 under which the fair value is measured using unobservable inputs – being the EBITDA
performance of the acquired companies.
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (that is, as prices) or indirectly (that is, derived from prices).
Level 3: Inputs for the asset or liability that are not based on observable market data (that is, unobservable
inputs).
The holders of ordinary shares are entitled to receive dividends and are entitled to vote at general meetings
of the Company.
During the year, the Company issued nil (2021: nil) ordinary shares in respect of all share plans.
Purchase of own shares for trust
During the year ended 31 December 2022, the Company financed the purchase of 45,000 (2021: 216,310) of
its own shares with an aggregate nominal value of £450 (2021: £2,163) for £2.3m (2021: £11.4m) which was
charged to retained earnings in equity and was held by the ESOT. This trust is managed by an independent
offshore trustee. During the year, 187,139 shares were utilised to satisfy the vesting of share awards (note
17). At 31 December 2022, the ESOT held 132,407 shares (2021: 274,546 shares) with an aggregate nominal
value of £1,324 (2021: £2,745). The associated cash outflow of £2.3m (2021: £11.4m) has been presented as
a financing cash flow.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 33
15 Capital and reserves Continued
Dividends
Amounts recognised as distributions to equity holders:
Final dividend for the year ended 31 December 2020
Interim dividend for the year ended 31 December 2021
Final dividend for the year ended 31 December 2021
Interim dividend for the year ended 31 December 2022
Dividends paid
2022
£m
2022
Pence per
share
2021
£m
2021
Pence per
share
–
–
115.5
55.1
170.6
–
–
71.6
34.2
105.8
115.5
55.1
–
–
170.6
71.6
34.2
–
–
105.8
After the reporting date, the Directors proposed a final dividend of 71.6p per share in respect of the year
ended 31 December 2022, which is expected to amount to £115.5m. This dividend is subject to approval
by shareholders at the Annual General Meeting and therefore, in accordance with IAS 10 Events After the
Reporting Date, it has not been included as a liability in these financial statements. If approved, the final
dividend will be paid to shareholders on 15 June 2023.
Reserves
Translation reserve
The translation reserve comprises foreign currency differences arising from the translation of the financial
statements of foreign operations as well as the translation of liabilities that hedge the Group’s net investment
in foreign operations.
Other
This reserve includes a merger difference that arose in 2002 on the conversion of share warrants into share
capital, as well as the cash flow hedge reserve.
16 Employee benefits
Accounting policy
Pension schemes
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions
into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for
contributions to defined contribution pension plans are recognised as an employee benefit expense in the
income statement as incurred.
Defined benefit plans
A defined benefit plan is a post-employment benefit plan other than a defined contribution plan.
The Group’s net obligation in respect of material defined benefit pension plans is calculated separately for each
plan by estimating the amount of future benefit that employees have earned in return for their service in the
current and prior years; that benefit is discounted to determine its present value. The fair value of any plan
assets is deducted.
In calculating the defined benefit surplus or deficit, the discount rate is the yield at the reporting date on AA
credit-rated bonds that have maturity dates approximating the terms of the Group’s obligations and that are
denominated in the same currency in which the benefits are expected to be paid. The calculation is performed
annually by a qualified actuary using the Projected Unit Credit method.
The increase in the present value of the liabilities expected to arise from the employees’ services in the
accounting period is charged to the operating profit in the income statement. The expected return on the
schemes’ assets and the interest on the present value of the schemes’ liabilities, during the accounting period,
are shown as finance income and finance expense, respectively.
The Group operates a number of pension schemes throughout the world. In most locations, these are defined
contribution arrangements. However, there are significant defined benefit schemes in the United Kingdom and
Switzerland. The United Kingdom Scheme is funded, with assets held in separate trustee-administered funds
and the Switzerland Scheme is an insured scheme. The scheme in the United Kingdom was closed to new
entrants in 2002. Other funded defined benefit schemes are not considered to be material and are therefore
accounted for as if they were defined contribution schemes.
In line with IAS 19 and IFRIC 14, if a scheme has a surplus this is recognised on the statement of financial
position if the economic benefit is available to the Group as a result of the surplus. Economic benefit is defined
as when an entity has an unconditional right to a refund from the scheme whilst the scheme is ongoing; or
assuming the gradual settlement of the scheme liabilities over time until all members have left the scheme/
died; or assuming the full settlement of the scheme’s liabilities in a single event. In the event of a surplus,
the relevant scheme rules will be reviewed in line with IFRIC 14 and a legal opinion obtained to identify if the
surplus can be recognised by the Group.
The Group recognises all actuarial remeasurements in each year in equity through the consolidated statement
of comprehensive income.
Total pension cost
The total pension cost included in operating profit for the Group was:
Defined contribution schemes
Defined benefit schemes – current service cost and administration expenses
Pension cost included in operating profit (note 5)
2022
£m
(59.6)
(1.9)
(61.5)
2021
£m
(51.4)
(2.4)
(53.8)
The pension cost for the defined benefit schemes was assessed in accordance with the advice of qualified
actuaries. The last full triennial actuarial valuation of The Intertek Pension Scheme in the United Kingdom
(‘United Kingdom Scheme’) was carried out as at 31 March 2022, and for IAS 19 accounting purposes has
been updated to 31 December 2022. The Switzerland Scheme was valued for IAS 19 purposes as at
31 December 2022. The average duration of the schemes’ liabilities are 13 years for both the United
Kingdom and Switzerland schemes.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 16 Employee benefits Continued
Defined benefit schemes
The cost of defined benefit schemes
The amounts recognised in the income statement were as follows:
Current service cost
Scheme administration expenses
Net pension interest cost (note 14)
Total charge
34
2022
£m
(1.5)
(0.4)
0.1
(1.8)
2021
£m
(2.0)
(0.4)
(0.1)
(2.5)
The current service cost and scheme administration expenses are included in operating costs in the income
statement and pension interest cost and interest income are included in net financing costs.
Included in other comprehensive income:
Remeasurements arising from:
Demographic assumptions
Financial assumptions
Experience adjustment
Asset valuation
Other
Total
2022
£m
(0.6)
52.3
(5.3)
(29.8)
0.8
17.4
2021
£m
(1.4)
8.1
(2.1)
7.5
(0.6)
11.5
Company contributions
The Company assessed the triennial actuarial valuation for the United Kingdom Scheme and its impact on the
scheme funding plan in 2022 and future years. In 2023 the Group expects to make normal contributions of
£0.6m (2022: £0.6m) and a special contribution of £nil (2022: £2.0m). The next triennial valuation is due to
take place as at 31 March 2025 and will include a review of the Company’s future contribution requirements.
Pension asset/liability for defined benefit schemes
The amounts recognised in the statement of financial position for defined benefit schemes were as follows:
31 December 2022
Fair value of scheme assets
Present value of funded defined benefit obligations
Surplus/(Deficit) in schemes
United
Kingdom
Scheme
£m
108.2
(86.9)
21.3
Switzerland
Scheme
£m
12.9
(15.1)
(2.2)
Total
£m
121.1
(102.0)
19.1
The fair value changes in the scheme assets are shown below:
Fair value of scheme assets at 1 January
Interest income
Normal contributions by the employer
Special contributions by the employer
Contributions by scheme participants
Benefits paid
Effect of exchange rate changes on overseas schemes
Remeasurements
Scheme administration expenses
Settlements*
Fair value of scheme assets at 31 December
2022
£m
155.4
2.7
1.3
2.0
0.6
(4.2)
1.5
(29.8)
(0.4)
(8.0)
121.1
2021
£m
150.4
1.8
1.3
2.0
0.6
(7.2)
(0.6)
7.5
(0.4)
–
155.4
*
Settlements represent transfer to the reinsurer of assets and legal obligations related to the benefits provided to inactive members of part
of the Switzerland Scheme.
Asset allocation
Investment statements were provided by the investment managers which showed that, as at 31 December
2022, the invested assets of the United Kingdom Scheme totalled £108.2m (2021: £137.0m), broken down
as follows.
Asset class
Equities
Property
Liability-Driven Investment*
Corporate debt instruments
Cash
Total
United Kingdom Scheme
2022
£m
44.2
4.5
11.8
37.9
9.8
2021
£m
72.1
5.2
16.8
38.0
4.9
108.2
137.0
*
Investments are included at fair value. The pooled investment vehicles are held under a managed fund policy in the name of the Scheme.
Pooled investment vehicles (including the LDI Fund) which are not traded on active markets, but where the investment manager has provided
a monthly trading price, are valued using the last single price, provided by the investment manager at or before the year-end. The LDI Fund
provides the hedge against adverse movements in inflation and interest rates. It seeks to match the sensitivity of the Scheme’s liability cash
flow to changes in interest rates and inflation; it is invested in gilts, swaps, futures, repo contracts and money market instruments.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 35
16 Employee benefits Continued
The United Kingdom Scheme had bank account assets of £9.6m as at 31 December 2022 (2021: £1.2m).
Life expectancy assumptions at year-end for:
The United Kingdom Scheme invested assets comprising both quoted and unquoted assets. The value of
quoted assets in 2022 was £11.7m (2021: £17.3m), included within equities in the above table, with the
remaining assets being unquoted. The invested assets of the Switzerland Scheme comprise cash in savings
and contribution accounts. The Switzerland Scheme is fully insured.
Changes in the present value of the defined benefit obligations were as follows:
Male aged 40
Male aged 65
Female aged 40
Female aged 65
United Kingdom Scheme
Switzerland Scheme
2022
48.4
21.7
50.6
23.8
2021
47.8
21.8
50.1
23.9
2022
49.4
22.0
51.0
23.7
2021
49.1
22.6
50.9
24.4
Defined benefit obligations at 1 January
Current service cost
Interest cost
Contributions by scheme participants
Benefits paid
Effect of exchange rate changes on overseas schemes
Remeasurements
Settlements
Defined benefit obligations at 31 December
Principal actuarial assumptions:
Discount rate
Inflation rate (based on CPI)
Rate of salary increases
Rate of pension increases:
CPI subject to a maximum of 5% p.a.
Increases subject to a maximum of 2.5% p.a.
The Switzerland Scheme is an insured plan.
2022
£m
154.0
1.5
2.6
0.7
(4.2)
1.8
(46.4)
(8.0)
102.0
2021
£m
162.5
2.0
1.9
0.2
(7.2)
(0.7)
(4.7)
–
154.0
The table above shows, for the United Kingdom Scheme, the number of years a male or female is expected
to live, assuming they were aged either 40 (and lives to 65) or 65 at 31 December. The mortality tables
adopted in 2022 for the United Kingdom Scheme are S3PA tables, based on the CMI 2021 mortality projection
model with a 1.25% long-term annual rate for future improvements. In 2021 the S3PA tables were used, based
on the CMI 2019 mortality projection model with a 1.00% long-term annual rate for future improvement. For
the Switzerland Scheme, the mortality table adopted in 2022 and 2021 is the BVG2020, an industry standard
in Switzerland which is based on statistical evidence of major Switzerland pension funds.
Sensitivity analysis
The table below sets out the sensitivity on the United Kingdom pension assets and liabilities as at
31 December 2022 of the two main assumptions:
United Kingdom Scheme
Switzerland Scheme
Change in assumptions
2022
%
4.85
2.1
–
2.15
1.7
2021
%
1.9
2.25
–
2.25
1.8
2022
%
2.3
n/a
1.75
n/a
n/a
2021
%
0.35
n/a
1.0
n/a
n/a
No change
0.25% rise in discount rate
0.25% fall in discount rate
0.25% rise in inflation
0.25% fall in inflation
The United Kingdom Scheme is also subject to the mortality assumption. If the mortality tables used are rated
up/down one year, the value placed on the liabilities increases by £3.1m and decreases by £3.1m, respectively.
Funding arrangements
United Kingdom Scheme
The Trustees use the Projected Unit Credit Method with a three-year control period. Currently the scheme
members pay contributions at the rate of 8.5% of salary. The employer pays contributions of 18.5% of salary,
plus £0.2m per year to fund scheme expenses and has made an additional contribution of £2.0m in 2022 to
reduce the deficit disclosed by the 2019 valuation.
UK Scheme
Increase/
(decrease) in
surplus/
deficit
£m
–
(2.7)
2.9
1.4
(1.5)
Liabilities
£m
86.9
84.1
89.8
88.3
85.4
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 36
16 Employee benefits Continued
Funding risks
The main risks for the schemes are:
Investment return risk:
Investment matching risk:
If the assets underperform the returns assumed in setting the funding
targets then additional contributions may be required at subsequent
valuations.
The schemes invest significantly in equities, whereas the funding targets are
closely related to the returns on bonds. If equities fall in value relative to the
matching asset of bonds, additional contributions may be required.
Longevity risk:
If future improvements in longevity exceed the assumptions made for
scheme funding then additional contributions may be required.
Role of third parties
The United Kingdom Scheme is managed by Trustees on behalf of its members. The Trustees take advice
from appropriate third parties including investment advisers, actuaries and lawyers as necessary.
17 Share schemes
Accounting policy
Share-based payment transactions
The share-based compensation plans operated by the Group allow employees to acquire shares of the
Company. The fair value of the employee services, received in exchange for the grant of shares, is measured
at the grant date and is recognised as an expense with a corresponding increase in equity. The charge is
calculated using the Black-Scholes method and expensed to the income statement over the vesting period of
the relevant award. The charge for the Deferred Share Awards is adjusted to reflect expected and actual levels
of vesting for service conditions. The expense of the LTIP Share Awards is calculated using the Monte Carlo
method and the fair value adjusted for the probability of performance conditions being achieved.
Share plans
2011 Long Term Incentive Plan
The Deferred Bonus Plan 2005 was replaced in 2011 with the Intertek 2011 Long Term Incentive Plan (‘LTIP’).
Deferred Share Awards (previously Share Awards) and LTIP Share Awards (previously Performance Awards)
have been granted under this plan. The first awards were granted on 7 April 2006. The awards under these
plans vest three years after grant date, subject to fulfilment of the performance conditions. The weighted
average remaining contractual life of share options outstanding at the end of the period is four months.
2021 Long Term Incentive Plan
The Intertek 2021 Long Term Incentive Plan (‘2021 Plan’) was approved at the 2020 Annual General Meeting
as the Intertek 2011 Long Term Incentive Plan was approaching the end of its ten-year life cycle. The 2021
Plan is broadly similar to the previous Long Term Incentive Plan, but with amendments to take account of
developments in market practice. The awards made in 2022 were made under the 2021 Plan on 11 March
2022. The awards under these plans vest three years after grant date, subject to fulfilment of the non-market
based performance conditions.
2022
2021
Outstanding awards
At beginning of year
Granted*
Vested**
Forfeited
Deferred
Share Awards
LTIP Share
Awards
Total awards
Deferred
Share Awards
LTIP Share
Awards
662,706
323,181
(251,311)
(60,383)
791,842
359,589
–
(341,015)
1,454,548
682,770
(251,311)
(401,398)
784,932
200,550
(246,474)
(76,302)
889,937
325,562
(103,321)
(320,336)
Total awards
1,674,869
526,112
(349,795)
(396,638)
At end of year
674,193
810,416
1,484,609
662,706
791,842
1,454,548
*
Includes 15,388 Deferred Share Awards (2021: 11,298) and 21,150 LTIP Share Awards (2021: 16,232) granted in respect of dividend
accruals.
** Of the 251,311 awards vested in 2022, nil were satisfied by the issue of shares and 170,968 by the transfer of shares from the ESOT (see
note 15). The balance of 80,343 awards represented a tax liability of £4.1m (2021: £6.3m) which was settled in cash on behalf of employees
by the Group, of which £3.6m was settled by the Company.
Buyout Awards
On 1 April 2021, Jonathan Timmis was granted conditional rights to acquire 39,000 shares under a one-off
arrangement as a condition of his recruitment as CFO of the Company, granted under the Long Term Incentive
Plan 2021. The award comprised three parts of 13,000 shares, vesting on 1 April 2022, 1 April 2023 and
1 April 2024. Further details are shown in the Remuneration report in Book two, pages 78 to 103.
Deferred Share Plan
Awards may be granted under the Deferred Share Plan (‘DSP’) to employees of the Group (other than the
Executive Directors of the Company) selected by the Remuneration Committee over existing, issued ordinary
shares of the Company only. The DSP was adopted primarily to allow for the deferral of a proportion of selected
employees’ annual bonus into shares in the Company but may also be used for the grant of other awards (such
as incentive awards and buyout awards for key employees) in circumstances that the Remuneration Committee
deems appropriate. Awards will normally have a three-year vesting period. Awards may be made subject to
performance conditions and are subject to normal good and bad leaver provisions and malus and clawback.
Outstanding awards
At beginning of year
Granted*
Vested**
Forfeited
At end of year
2022
2021
Deferred
Share Awards
Total
awards
Deferred
Share Awards
Total
awards
37,368
22,420
(21,984)
–
37,368
22,420
(21,984)
–
45,881
33,641
(31,308)
(10,846)
45,881
33,641
(31,308)
(10,846)
37,804
37,804
37,368
37,368
Includes 1,119 Deferred Share Awards (2021: 1,180) granted in respect of dividend accruals.
*
** Of the 21,984 awards vested in 2022, 16,171 were satisfied by the transfer of shares from the ESOT (see note 15). The balance of 5,813
awards represented a tax liability of £0.3m which was settled in cash on behalf of employees by the Group, of which £0.3m was settled by
the Company.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 37
17 Share schemes Continued
Equity-settled transactions
During the year ended 31 December 2022, the Group recognised an expense of £17.5m (2021: £18.6m). The
fair values and the assumptions used in their calculations are set out below:
18 Subsequent events
On 14 February 2023, funded from the existing revolving credit facility, a US$40m senior note at a fixed
annual interest rate of 3.10% was repaid.
Fair value at measurement date (pence)
Share price (pence)
Time to maturity (years)
Fair value at measurement date (pence)
Share price (pence)
Time to maturity (years)
2022 Awards
Deferred
Share Awards
Share
Awards
LTIP Share
Awards
4,636
4,636
1–3
4,845
4,845
4,180
4,180
3
3
2021 Awards
Deferred
Share Awards Share Awards
LTIP Share
Awards
5,345
5,345
1–3
4,791
4,791
3
4,855
4,855
3
The weighted-average exercise prices of all share awards in the year are £nil (2021: £nil).
All Share Awards are granted under a service condition. Such condition is not taken into account in the fair
value measurement at grant date. From 2020 the LTIP Share Awards were granted under performance-related
non-market conditions only.
19 Capital management
The Directors determine the appropriate capital structure of Intertek; specifically how much capital is raised
from shareholders (equity) and how much is borrowed from financial institutions (debt) in order to finance the
Group’s activities. These activities include ongoing operations as well as acquisitions as described in note 10.
The Group’s policy is to maintain a robust capital base (including cash and debt) to ensure the market and key
stakeholders retain confidence in the capital profile. Debt capital is monitored by Group Treasury assessing the
liquidity buffer on a short- and longer-term basis as discussed in note 14. Financial net debt has increased from
£733.3m at 31 December 2021 to £737.9m at 31 December 2022. The Group has a strong balance sheet with
financial net debt to EBITDA of 1.1.
During 2022, the Group has continued the working capital focus and through disciplined performance
management, working capital has reduced by £4.5m to negative £47.8m. Working capital is defined on page 3.
The Group uses key performance indicators, including return on invested capital (‘ROIC’) and adjusted diluted
earnings per share to monitor the capital position of the Group to ensure it is being utilised effectively. The rate
of ROIC, defined as adjusted operating profit less adjusted taxes divided by invested capital, measures how
effectively the Group generates profit from its invested capital. This is a key measure to assess the efficiency
of investment decisions and is also an important criterion in the decision-making process. ROIC in 2022 was
18.0% (2021: 18.2%). Adjusted diluted earnings per share is a key measure of value creation for the Board and
for shareholders and in 2022 was 211.1p (2021: 190.8p).
The dividend policy also forms part of the Board’s capital management policy, and the Board ensures there is
appropriate earnings cover for the dividend proposed at both the interim and year-end. Our dividend policy aims
to deliver sustainable dividend growth over time, based on a target dividend payout ratio of c.50%. Reflecting
the Group’s strong cash generation in 2022 and reduced leverage, the recommended final dividend is 71.6p
bringing the full-year dividend to 105.8p, which is in line with 2021, and the dividend payout ratio to 50%.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 38
22 Contingent liabilities
Guarantees, letters of credit and performance bonds
2022
£m
40.0
2021
£m
28.7
Litigation
The Group is involved in various claims and lawsuits incidental to the ordinary course of its business, including
claims for damages, negligence and commercial disputes regarding inspection and testing, and disputes with
employees and former employees. The Group is not currently party to any legal proceedings other than
ordinary litigation incidental to the conduct of business. These claims are not currently expected to result in
meaningful costs and liabilities to the Group. The Group maintains appropriate insurance cover to provide
protection from the small number of significant claims it is subject to from time to time.
Tax
The Group operates in more than 100 countries and with complex tax laws and regulations. At any point in
time it is normal for there to be a number of open years which may be subject to enquiry by local authorities.
In some jurisdictions the Group receives tax incentives (see note 6) which are subject to renewal and review
and reduce the amount of tax payable. Where the effect of the laws and regulations is unclear, estimates are
used in determining the liability for the tax to be paid. The Group considers the estimates, assumptions and
judgements to be reasonable but this can involve complex issues which may take a number of years to resolve.
20 Non-controlling interest
Accounting policy
Acquisitions of non-controlling interests are accounted for as transactions with owners in their capacity
as owners and therefore no goodwill is recognised as a result of such transactions.
Non-controlling interest
An analysis of the movement in non-controlling interest is shown below:
At 1 January
Exchange adjustments
Share of profit for the year
Adjustment arising from changes in non-controlling interest
Dividends paid to non-controlling interest
At 31 December
2022
£m
32.3
0.3
18.0
–
(16.6)
34.0
2021
£m
28.0
1.0
18.6
1.7
(17.0)
32.3
21 Related parties
Identity of related parties
The Group has a related party relationship with its key management. Balances and transactions between the
Company and its subsidiaries and between subsidiaries have been eliminated on consolidation and are not
discussed in this note.
Transactions with key management personnel
Key management personnel compensation, including the Group’s Directors, is shown in the table below:
Short-term benefits
Post-employment benefits
Equity-settled transactions
Total
2022
£m
9.8
0.7
3.6
2021
£m
9.7
0.8
7.7
14.1
18.2
More detailed information concerning Directors’ remuneration, shareholdings, pension entitlements and
other long-term incentive plans is shown in the audited parts of the Remuneration report in Book two,
pages 92 to 101. Apart from the above, no member of key management had a personal interest in any
business transactions of the Group.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 39
23 Principal Group companies
The principal subsidiaries whose results or financial position, in the opinion of the Directors, principally affect
the figures of the Group have been shown below. All the subsidiaries shown were consolidated with Intertek
Group plc as at 31 December 2022. Unless otherwise stated, these entities are wholly owned subsidiaries and
the address of the registered office is Academy Place, 1–9 Brook Street, Brentwood, Essex, CM14 5NQ, United
Kingdom.
Company name
Intertek Australia Holdings Pty Limited (i)
Intertek Finance plc
Intertek Holdings Limited (ii)
Intertek Technical Services, Inc. (iii)
Intertek Testing Services Holdings Limited (ii)
Intertek Testing Services Hong Kong Limited (iv)
Intertek Testing Services Limited Shanghai (v)
Intertek Testing Services NA, Inc. (vi)
Intertek Testing Services Shenzhen Limited (vii)
Intertek USA, Inc. (viii)
Intertek USD Finance Limited
Labtest Hong Kong Limited (ix)
RCG-Moody International Limited
Testing Holdings USA, Inc. (vi)
Country of Incorporation and
principal place of operation
Australia
England
England
USA
England
Hong Kong
China
USA
China
USA
England
Hong Kong
England
USA
Activity
Holding
Finance
Holding
Trading
Holding
Trading
Trading
Trading
Trading
Trading
Finance
Trading
Holding
Holding
(i) Registered office address: 544 Bickley Road, Maddington WA 6109, Australia.
(ii) Directly owned by Intertek Group plc.
(iii) Registered office address is: 25025 I-45, Suite 300, Spring, TX 77380, United States.
(iv) Registered office address is: 2/F Garment Centre, 576 Castle Peak Road, Kowloon, Hong Kong.
(v) Equity shareholding 85%, company controlled by the Group based on management’s assessment; Registered office address is: 2nd Floor,
West District, Free Trade Test Zone, Zhangyang Road, Shanghai, China.
(vi) Registered office address is: 3933 US Route 11, Cortland, NY 13045, United States.
(vii) Registered office address is: 3-5/F of Bldg. 1, 1-5/F of Bldg. 3, No. 4012, Wuhe Ave. North, Bantian Street, Yuanzheng Science and Technology
Industrial Park, Shenzhen, Guangdong, China.
(viii) Registered office address is: 200 Westlake Park Blvd., Westlake Building 4, Suite 400, Houston, TX 77079, United States.
(ix) Registered office address is: 2/F, Garment Centre, 576 Castle Peak Road, Kowloon, Hong Kong.
Group companies
In accordance with section 409 of the Companies Act 2006, all related undertakings are set out in the
following list. Related undertakings comprise subsidiaries, partnerships, associates, joint ventures and joint
arrangements. The principal subsidiaries listed above have not been duplicated in the following list.
Where no address is listed, the address of the registered office is Academy Place, 1–9 Brook Street, Brentwood,
Essex, CM14 5NQ, United Kingdom. Unless otherwise stated, the share capital for all related undertakings
included in this note comprises ordinary or common stock shares which are indirectly held by Intertek Group plc
as at 31 December 2022. The percentage held by class of share is stated where this is less than 100%. No
subsidiary undertakings have been excluded from the consolidation.
Fully owned subsidiaries
0949491 B.C. Limited
1200-925 West Georgia Street, Vancouver, British Columbia, V6C 3L2, Canada
4th Strand, LLC (i) (xv)
1950 Evergreen Boulevard, Suite 100, Duluth, GA 30096, United States
Acucert Labs, LLP (xv)
82/2, Shreyas, 25th Road, Sion West, Mumbai, 400022, India
Acumen Security, LLC
2400 Research Blvd, Suite 395, Rockville, MD 20850, United States
Adelaide Inspection Services Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
Admon Labs Servicios Corporativos y Administrativos, S.A. de C.V.
Boulevard Adolfo Lopez Mateos #2259, Atlamaya, Alvaro Obregon, Ciudad de Mexico, C.P. 01760, Mexico
Advancing Food Safety Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
Ageus Solutions Inc.
255 Michael Cowpland Dr., Suite 200, Ottawa, Ontario, K2M 0M5, Canada
Alchemy Investment Holdings, Inc.
5300 Riata Park Court, Austin, TX 78727, United States
Alchemy Systems, L.P. (xv)
5301 Riata Park Court, Austin, TX 78727, United States
Alchemy Systems Training, Inc.
5300 Riata Park Court, Austin, TX 78727, United States
Alchemy Systems Training Limited
Alchemy Training Technologies, Inc.
1 Germain Street, Suite 1500, Saint John, NB E2L 4V1, Canada
Alta Analytical Laboratory, Inc. (i)
200 Westlake Park Blvd., Westlake Building 4, Suite 400, Houston, TX 77079, United States
Angus Management, LLC (xv)
5300 Riata Park Court, Austin, TX 78727, United States
Anstat Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
Architectural Testing, Inc.
130, Derry Court, York, PA 17406, United States
Architectural Testing Holdings, Inc.
130 Derry Court, York, PA 17406, United States
Bellini & Sandrini Holding LTDA
Rua Carlos Tosin, 860, sala 1, Distrito Industrial, Distrito Industrial, Estado de São Paulo, Brazil
Bigart Ecosystems, LLC (xv)
212 S. Wallace Avenue Bozeman, MT 59715, United States
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 40
23 Principal Group companies Continued
Caleb Brett Ecuador S.A.
Centro Commercial Mall del Sol, Av. Joaquín Orrantia González y Juan Tanca Marengo, Torre B, Piso 5, Oficina 505,
Guayaquil, Ecuador
Cantox U.S. Inc. (ii)
100 Davidson Avenue, Suite #102, Somerset, NJ 08873, United States
Catalyst Awareness, Inc.
43 Carolinian Lane, Cambridge, ON N1S 5B5, Canada
Center for the Evaluation of Clean Energy Technology, Inc.
3933 US Route 11, Cortland, NY 13045, United States
Check Safety First Limited
Checkpoint Solutions Ltd
Cistera Limited (i)
2/F, Garment Centre, 576 Castle Peak Road, Kowloon, Hong Kong
Cristal Middle East SAE
22 El-Imam Ali, Almazah, Heliopolis, Cairo Governorate, Egypt
Cristal North Africa CNA
Immeuble, SOGIT Faisant angle de la rue, lac victoria, et rue du des lacs de mazurie, les berges du lac, 1053
Tunis Le bureau, B5 situé, au 2ème étage, Tunis, Tunisia
Electronic Warfare Associates-Canada, Ltd
1223 Michael Street North, Suite 200, Ottawa, ON K1J 7T2, Canada
Enertech Australia Pty. Limited
544 Bickley Road, Maddington WA 6109, Australia
Entela-Taiwan, Inc
4700 Broadmoor Avenue SE, Suite 200, Kentwood, MI 49512, United States
Esperanza Guernsey Holdings Limited
PO Box 472, St Julian’s Court, St Julian’s Avenue, St Peter Port, GY1 6AX, Guernsey
Esperanza International Services (Southern Africa) (Pty.) Limited
Charter House, 13 Brand Road, Glenwood, Durban, South Africa
Excel Partnership, Inc.
250 S. Wacker Drive, Suite 1800, Chicago, IL 60606, United States
Fivetix Professional Services Private Limited
F-Wing, I Floor, Tex Centre, 26-A Chandiwali Farm Road, Andheri (East) Mumbai Mumbai City MH 400072, India
Four Front Research (India) Pvt Limited (ii)
Plot# 847, 5th Floor, Near Electricity Substation, Ayyappa Society Road, Madhapur, Hyderabad, Telangana,
500081, India
Frameworks Inc.
1595 Sixteenth Avenue, Suite 301, Richmond Hill, ON L4B 3N9, Canada
Gamatek, S.A. de C.V.
Alanis Valdez #2308, Industrial, Monterrey, Nuevo Leon, Mexico
GCA Calidad y Analisis de Mexico, S.A. de C.V.
Jacarandas #19, San Clemente, Alvaro Obregon, Ciudad de Mexico, C.P. 01740, Mexico
Gellatly Hankey Marine Services (M) Sdn. Bhd.
Unit 30-01 Level 30, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8, Jalan Kerinchi, 59200
Kuala Lumpur, Malaysia
Genalysis Laboratory Services Pty Limited (vi)
544 Bickley Road, Maddington WA 6109, Australia
Geotechnical Services Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
Global Trust Certification (UK) Limited
Global X-Ray & Testing Corporation
112 East Service Road, Morgan City, LA 70380, United States
Global X-Ray Holdings, Inc. (ix)
112 East Service Road, Morgan City, LA 70380, United States
H.P. White Laboratory Inc.
3114 Scarboro Road, Street, MD 21154, United States
Hawks Acquisition Holding, Inc.
545 E. Algonquin Road, Arlington Heights, Illinois 60005, United States
Hi-Tech Holdings, Inc.
CT Corporation System, 1200 S.Pine Island Road, Plantation, FL 33324, United States
Hi-Tech Testing Service, Inc.
CT Corporation System, 1999 Bryan Street Suite 900, Dallas, TX 75201, United States
ILI Infodisk, Incorporated.
205 W. Wacker Dr, Suite 1800, Chicago, IL 60606, United States
ILI Limited
Inspection Services (US), LLC (xv)
237 Stuart Road, Amelia, LA 70340, United States
International Cargo Services, Inc. (i)
c/o CT Corp, 8550 United Plaza Blvd, Baton Rouge, LA 70809, United States
International Inspection Services Limited
33/37 Athol Street, Douglas, IM1 1LB, Isle of Man
Intertek (Mauritius) Limited
2 Palmerston Road, Phoenix, Mauritius
Intertek (Schweiz) AG
TechCenter, Kaegenstrasse 18, 4153 Reinach, Switzerland
Intertek Algeria Ltd EURL
Zone urbaine Garidi 1, N°C7/C8, Bâtiment F1, 1er étage Local N°1, 16051, Kouba, Wilaya d’Alger, Algeria
Intertek Argentina Certificaciones S.A. (iii)
Cerrito 1136 3rd floor CF, Ciudad Autónoma de Buenos Aires, C1010AAX, Argentina
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 41
23 Principal Group companies Continued
Intertek Aruba N.V.
Lago Heights Straat 28A, San Nicolas, Aruba
Intertek Asset Integrity Management, Inc.
25025 I-45, Suite 300, Spring, TX 77380, United States
Intertek ATI SRL
266-268 Calea Rahovei Street, Building 61, 1st Floor, Sector 5, Bucharest, Romania
Intertek Azeri Limited
2236 Mirza Davud Str., Xatai District, Baku, AZ 1026, Azerbaijan
Intertek BA EOOD
24A Akad. Metodi Popov Str., Floor 5, Sofia, 1113, Bulgaria
Intertek Bangladesh Limited
Phoenix Tower, Plot–407 (3rd Floor), Tejgaon I/A, Dhaka, Bangladesh
Intertek Belgium NV
Kruisschansweg 11, 2040 Antwerp, Belgium
Intertek Burkina Faso Ltd Sarl (i)
Ouagadougou, Secteur 13, Parcelle 21, Lot 11 Section EO Arrondissement de Nongr’Masson, Ouagadougou, 11
GP 1429, Burkina Faso
Intertek C&T Australia Holdings PTY Ltd (i)
544 Bickley Road, Maddington, WA 6109, Australia
Intertek C&T Australia Pty Ltd (i)
Level 3, 235 St Georges Terrace, Perth WA 6000, Australia
Intertek Caleb Brett (Uruguay) S.A. (xiv)
Cerrito 507, 4th Floor, Of. 46 and 47, Montevideo, 11000, Uruguay
Intertek Caleb Brett Chile S.A.
Avenida Las Condes N° 11287 Torre A, oficina 301 A Las Condes, Santiago, Chile
Intertek Caleb Brett El Salvador S.A. de C.V.
Recinto Industrial de RASA zona industrial de Acajutla, Sonsonate, El Salvador
Intertek Caleb Brett Germany GmbH
Georgswerder Bogen 3, D-21109 Hamburg, Germany
Intertek Caleb Brett Panama, Inc.
Zona Procesadora para la Exportacion de Albrook, Building 6, Ancon Panama, Panama
Intertek Certification AB
Torshamnsgatan 43, Box 1103, Kista, S-164 22, Sweden
Intertek Certification AS
Leif Weldings vei 8, 3208 Sandefjord, Norway
Intertek Certification GmbH
Marie-Bernays-Ring 19a, 41199 Monchengladbach, Germany
Intertek Certification Japan Limited
Nihonbashi North Square, 1-4-2, Nihonbashi – Horidomecho, Chuo-ku, Tokyo, 103-0012, Japan
Intertek Certification Limited
Intertek Colombia S.A.
Calle 127A No. 53A-45, Oficina 1103, Bogotá, Colombia
Intertek Commodities Mozambique Lda (xvi)
Rua 1233, NR 72 R/C, Distrito Urbano 1, Maputo, Mozambique
Intertek Consulting & Training (UK) Limited (ii)
Northpoint Aberdeen Science & Energy Park, Exploration Drive, Bridge of Don, Aberdeen, AB23 8HZ, United
Kingdom
Intertek Consulting & Training (USA), Inc. (i)
25025 I-45, Suite 300, Spring, TX 77380, United States
Intertek Consulting & Training Colombia Limitada
Calle 127A No. 53A-45, Oficina 1103, Bogotá, Colombia
Intertek Consulting & Training Egypt (ii)
46 B Street #7, Maadi, Cairo, Egypt
Intertek Consumer Goods GmbH
Würzburger Strasse 152, 90766 Fürth, Germany
Intertek Curacao N.V.
Barendslaan #3, Rio Canario Willemstad, Curacao, Netherlands Antilles
Intertek de Guatemala SA
46 Calle 21-53 Zona 12, Expobodega 46, Edificio 10, Guatemala Ciudad, Guatemala
Intertek de Nicaragua S.A.
Zona Franca Astro KM 47, Carretera Tipitapa Masaya, Nave 20, Managua, Nicaragua
Intertek Denmark A/S
Dokhavnsvej 3, 4400 Kalundborg, Denmark
Intertek Caleb Brett Venezuela C.A.
Av. Mohedano, Centro Gerencial Mohedano, piso 4, oficina 4-C, La Castellana, Municipio Chacao, Venezuela
Intertek Deutschland GmbH
Stangenstrasse 1, 70771 Leinfelden-Echterdingen, Germany
Intertek Canada Newco Limited
1829-32nd Avenue, Lachine, QC H8T 3J1, Canada
Intertek Capacitacion Chile Spa
Avenida Las Condes N° 11287 Torre A, oficina 301 A Las Condes, Santiago, Chile
Intertek Capital Resources Limited
Intertek DIC A/S
Buen 12, 2, 6000 Kolding, Denmark
Intertek do Brasil Inspecoes Ltda
Av Eng. Augusto Barata s/n, Alamoa, Santos, SP, CEP11095-650, Brazil
Intertek Egypt for Testing Services
2nd Floor, Block 13001, Piece 15, Street 13, First Industrial Zone, (Beside Abou Ghali Motors), Elobour City,
Cairo, Egypt
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 42
23 Principal Group companies Continued
Intertek Evaluate AB
Torshamnsgatan 43, Box 1103, Kista, S-164 22, Sweden
Intertek Finance No. 2 Ltd (x)
Intertek Finland OY
Teknoublevardi 3-5, FI-01530 Vantaa, Finland
Intertek Food Services GmbH
Olof-Palme-Strasse 8, 28719 Bremen, Germany
Intertek France SAS
ZAC Ecopark 2, 27400, Heudebouville, France
Intertek Fujairah FZC
P.O. Box 1307, Fujairah, United Arab Emirates
Intertek Genalysis (Zambia) Limited
Plot No 25/26 Nkwazi House, Nkwazi and Cha Cha Cha Roads, PO Box 31014, Lusaka, Zambia
Intertek Genalysis Madagascar SA
Saint Denis Terrain II, Parcel 2 Ambatofotsy, Ampandrianomby, Madagascar
Intertek Genalysis South Africa Pty Ltd
544 Bickley Road, Maddington WA 6109, Australia
Intertek Ghana Limited
1st Floor Gian, Towers Office, Number 2 Community, Gian Towers Tema, Accra, Accra Metropolitan,
P.O. BOX GP 199, Ghana
Intertek Global (Iraq) Limited
Intertek Global Limited
1st Floor, Liberation House, Castle Street, St Helier, JE1 1GL, Jersey
Intertek Health Sciences Inc. (v)
2233 Argentia Road, Suite # 201, Mississauga, ON L5N 2X7, Canada
Intertek Holding Deutschland GmbH
Stangenstrasse 1, 70771 Leinfelden-Echterdingen, Germany
Intertek Holdings France SAS
ZAC Ecopark 2, 27400 Heudebouville, France
Intertek Holdings Italia SRL (xvi)
Via Guido Miglioli 2/A, Cernusco sul Naviglio, 20063, Milano, Italy
Intertek Holdings Nederland B.V.
Leerlooierstraat 135, 3194AB Hoogvliet, Rotterdam, The Netherlands
Intertek Holdings Norge AS
Oljevegen 2, Tananger, 4056, Norway
Intertek Ibérica Spain, S.L.
Alameda Recalde, 27-5., 48009, Bilbao, Vizcaya, Spain
Intertek India Private Limited
E-20, Block B1, Mohan Co-operative Industrial Area, Mathura Road, New Delhi, 110044, India
Intertek Industrial Services GmbH
Marie-Bernays-Ring 19a, 41199 Monchengladbach, Germany
Intertek Industry and Certification Services (Thailand) Limited
539/2 Gypsum Metropolitan Tower, 11C Fl., Sri-Ayudhaya Road, Tanon – Phayathai Subdistrict, Khet
Ratchathewi, Bangkok, 10400, Thailand
Intertek Industry Ghana Ltd
House Number 1, North Industrial Area, Klan, Anoma Ntuu Link, Accra, PO BOX 533, Ghana
Intertek Industry Holdings (Pty) Ltd
53 Phillip Engelbrecht Drive, Woodhill Office Park Building 2, 1st Floor Unit 8B Meyersdal, Gauteng, 1448,
South Africa
Intertek Industry Holdings Mozambique Limitada
Cidade de Maputo, Distrito Kampfumo, Baiiro Sommerchield, Avenida 1301 n˚97, Mozambique
Intertek Industry Services (S) Pte Ltd
2 International Business Park, #10-09/10, The Strategy, 609930, Singapore
Intertek Industry Services Brasil Ltda
Alameda Rio Negro, 161, room 702 – 7th floor, Alphaville, Barueri-SP, 06454-000-SP, Brazil
Intertek Industry Services de Argentina S.A.
Cerrito 1136, 2nd floor CF, Ciudad Autonoma de Buenos Aires, C1010AAX, Argentina
Intertek Industry Services Japan Limited
Nihonbashi North Square, 1-4-2, Nihonbashi – Horidomecho, Chuo-ku, Tokyo, 103-0012, Japan
Intertek Industry Services Romania Srl
266-268 Calea Rahovei Street, Building 61, 1st Floor, Sector 5, Bucharest, Romania
Intertek Industry WLL
Office # 24, Building 400, Road 3207, Mahooz, Block 332, Manama, Bahrain
Intertek Inspection Services Ltd
2561 Avenue Georges V, Montreal-Est, QC H1L 6S4, Canada
Intertek Inspection Services Scandinavia AS
Leif Weldings vei 8, 3208 Sandefjord, Norway
Intertek Inspection Services UK Limited
Intertek International Gabon SARL
Quartier Montagne Sainte – Immeuble Dumez, 2éme étage, Libreville, B.P: 13312, Gabon
Intertek International Guinee S.A.R.L. (i)
Conakry Republique de Guinee, Compte Bancaire: 52481.369.10 0 (SGBG), Conakry Guinea
Intertek International Inc.
8600 NW 17th Street, Suite 100, Miami, FL 33126, United States
Intertek International Kazakhstan, LLC
Building 2A, Abay street, Atyrau City, 060002, Kazakhstan
Intertek International Limited
Intertek International Ltd Egypt
69, Road 161, Intersection with Road 104, Ground Floor, Maadi, Cairo, Egypt
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 43
23 Principal Group companies Continued
Intertek International Nederland BV
Leerlooierstraat 135, 3194AB Hoogvliet, Rotterdam, The Netherlands
Intertek International Niger SARL
BP 2769, 2nd Floor Lot 792 Block Q, Independance Boulevard, Rue GM-20, Niger
Intertek International Suriname N.V.
Prins Hendrikstraat 49, Paramaribo, Suriname
Intertek International Tanzania Limited
Minazini Street, Kilwa Road 5, Dar es Salaam, United Republic of Tanzania
Intertek Italia SpA
Via Guido Miglioli 2/A, Cernusco sul Naviglio, 20063, Milano, Italy
Intertek Japan K.K.
Pier City Shibaura Building, 4F, 3-18-1, Kaigan, Minato-ku, Tokyo, 108-0022, Japan
Intertek Kalite Servisleri Limited Sirketi
Cevizli Mah. Tansel Cad. No: 12-18, Maltepe, Istanbul, Turkey
Intertek Pakistan (Private) Limited
Intertek House, Plot No.1-5/11-A, Sector-5, Korangi Industrial Area, Karachi, Pakistan
Intertek Poland sp.z.o.o.
Cyprysowa 23 B, 02-265, Warsaw, Poland
Intertek Polychemlab B.V.
Koolwaterstofstraat 1, 6161 RA, Geleen, The Netherlands
Intertek Portugal, Unipessoal Lda (xvi)
Rua Antero de Quental, 221-Sala 102, 4455-586, Perafita-Matosinhos, Portugal
Intertek Quality Services Ltd (i)
Intertek Resource Solutions (Trinidad) Limited (i)
#91-92 Union Road, Marabella, Trinidad, Trinidad and Tobago
Intertek Resource Solutions, Inc.
25025 I-45, Suite 300, Spring, TX 77380, United States
Intertek Rus JSC
2 floor, Building 2, Electrozavodskaya street, d.27, building 2, 107023, Moscow, Russian Federation
Intertek Korea Industry Service Ltd
Yeouido Dept Bldg #916, 36-2, Yeouido-Dong, Youngdeungpo-Gu, Seoul, 150-749, South Korea
Intertek S.R.O
Sokolovská 131/86, Karlín, Praha 8, 186 00, Czech Republic
Intertek Labtest S.A.R.L
7 Boulevard La Resistance IMM La Comanav Etage 7, Casablanca, Morocco
Intertek Malta Limited
24A Level 2, Flagstone Wharf, Marsa MRS 1932, Malta
Intertek Management Services (Australia) Pty Ltd
544 Bickley Road, Maddington WA 6109, Australia
Intertek Med SARL AU
Zone Franche Logistique Tanger Med, Plateau Bureaux 4, Lot 130, Tanger, Morocco
Intertek Medical Notified Body AB
Torshamnsgatan 43, Box 1103, Kista, S-164 22, Sweden
Intertek Medical Notified Body UK Ltd
Intertek Minerals Limited
Osu Badu Street, Airport Residential Area, Accra, Greater Accra, CP8196, Ghana
Intertek Myanmar Limited (i)
Classic Strand Cono, No.693/701, Room (4-A), (4th Floor), Merchant Road, Pabedan Township, Yangon, Myanmar
Intertek Nederland B.V.
Leerlooierstraat 135, 3194 AB Hoogvliet, Rotterdam, The Netherlands
Intertek Nominees Limited
Intertek OCA France SARL
Route Industrielle – Centre Routier, 76600, Gonfreville L’Orcher, France
Intertek Overseas Holdings Limited
Intertek Overseas Holdings, Eritrea Limited (i)
3rd Floor, Warsay Avenue, P.O. Box 4588, Asmara, Eritrea
Intertek Saudi Arabia Limited
Southern Olaya Center, Office No. 213, Makkah Al-Mukaramah Street, P.O. Box 2526, Al-Khobar, 31952,
Saudi Arabia
Intertek ScanBi Diagnostics AB
Box 166, Alnarp, SE-230 53, Sweden
Intertek Secretaries Limited (i)
Intertek Semko AB
Torshamnsgatan 43, Box 1103, Kista, S-164 22, Sweden
Intertek Services (Pty) Ltd
151 Monument Road, Aston Manor, 1619, South Africa
Intertek Servicios C.A. (i)
Res. San Ignacio, Calle San Ignacio de Loyola con Avenue Francisco de Miranda, Local 3, Chacao, Caracas,
Venezuela
Intertek Statius N.V.
Man ‘O’ War #B3, Oranjestad, St. Eustatius, Netherlands Antilles
Intertek Surveying Services (USA), LLC (xv)
16441 Space Center Boulevard, Suite D-100, Houston, TX 77058, United States
Intertek Surveying Services UK Limited
Averon House 3 Dail Nan Rocas, Teaninich Industrial Estate, Alness, IV17 0PH, United Kingdom
Intertek Technical Inspections Canada Inc. (iv)
1829-32nd Avenue, Lachine, Quebec, H8T 3J1, Canada
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 44
23 Principal Group companies Continued
Intertek Technical Services PTY Limited
544 Bickley Road, Maddington WA 6109, Australia
Intertek Technical Testing and Analysis Private Limited Company (i)
Bole Sub City Woreda 04, House Number 064/A/, Abune Yosef, Addis Ababa, 4260, Ethiopia
Intertek Testing & Certification Limited
Intertek Testing and Inspection Services UK Limited
Intertek Testing Management Ltd
Intertek Testing Services (Australia) Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
Intertek Testing Services (Cambodia) Company Limited
13AC, Street 337, Sangkat Boeung Kak I, Khan Tuol Kork, Phnom Penh, Cambodia
Intertek Testing Services (East Africa) (Pty) Limited
5th Floor Charter House, 13 Brand Road Glenwood, Kwa-Zulu Natal, 4001, South Africa
Intertek Testing Services (Fiji) Pte Limited
c/o BDO, Level 10, FNPF Place, 343 Victoria Parade, Suva, Fiji
Intertek Testing Services (Guangzhou) Ltd
No.3-1, Road 1, Xinhaixin Street, Huangge, Nansha District, Guangzhou, Guangdong, China
Intertek Testing Services (ITS) Canada Ltd
105-9000 Bill Fox Way, Burnaby BC V5J 5J3, Canada
Intertek Testing Services (Japan) K. K.
Nihonbashi North Square, 1-4-2, Nihonbashi – Horidomecho, Chuo-ku, Tokyo, 103-0012, Japan
Intertek Testing Services (NZ) Limited
3 Kepa Road, Ruakaka, Northland, 0171, New Zealand
Intertek Testing Services (Shanghai FTZ) Co., Ltd
1/F, Building No.4 Shanghai, 801 Yi Shan Road, Shanghai, 200233, China
Intertek Testing Services (Singapore) Pte Ltd.
3 Irving Road #05-01 to 05, Tai Seng Centre, 369522, Singapore
Intertek Testing Services (Thailand) Limited
1285/5 Prachachuen Road, Wong-Sawang Sub-District, Bangsue District, Bangkok, 10800, Thailand
Intertek Testing Services Argentina S.A.
Cerrito 1136, piso 3ro, Frente. Ciudad Autonoma de Buenos Aires, (C1010AAX), Argentina
Intertek Testing Services Bolivia S.A.
Calle Chichapi # 2125, Santa Cruz, de la Sierra, Bolivia
Intertek Testing Services Caleb Brett Egypt Limited
Intertek Testing Services Chongqing Co., Limited
1F/6F Building 3 No.5, East Gangcheng Loop Road, Chongqing China
Intertek Testing Services De Mexico, S.A. De C.V. (iii)
Poniente 134, No 660 Industrial Vallejo, Mexico DF CP, 02300, Mexico
Intertek Testing Services Environmental Laboratories Inc. (i)
Lexis Document Services, 15 East North Street, Dover, DE 19901, United States
Intertek Testing Services NA Limited
1829-32nd Avenue, Lachine QC H8T 3J1, Canada
Intertek Testing Services NA Sweden AB (i)
c/o Intertek Semko AB, Box 1103, Kista, 16422, Sweden
Intertek Testing Services Namibia (Proprietary) Limited
15th Floor, Frans Indongo Gardens, Dr Frans Indongo Street, Windhoek, Namibia
Intertek Testing Services Pacific Limited
2/F, Garment Centre, 576 Castle Peak Road, Kowloon, Hong Kong
Intertek Testing Services Peru S.A.
Jr. Mariscal Jose de la Mar No. 200 Urb., Res. El Pino, San Luis, Lima, Peru
Intertek Testing Services Philippines, Inc.
Intertek Building, 2307 Chino Roces Avenue Extension, Metro Manila, Makati City, 1231, Philippines
Intertek Testing Services Taiwan Limited
8F No. 423 Ruiguang Rd, Neihu District, Taipei, 11492, Taiwan
Intertek Testing Services Tianjin Limited
1-6/F, Block B, No. 7 Guiyuan Road, Hi-Tech Pack, Tianjin, China
Intertek Testing Services Zhejiang Ltd
Building No.2, Juanhu Science and Technology Innovation Park, No. 500 East Shuiyueting Road, Haining City,
Zhejiang Province, China
Intertek Timor, S.A.
Hotel Timor, Colmera, Vera Cruz, Dili, Timor-Leste
Intertek Training Malaysia Sdn. Bhd.
6-L12-01, Level 12, Tower 2, Menara PGRM, No. 6 & 8 Jalan Pudu Ulu, Cheras, 56100 Kuala Lumpur, Malaysia
Intertek Trinidad Limited
#91-92 Union Road, Marabella, Trinidad and Tobago
Intertek UK Holdings Limited
Intertek Ukraine (xvii)
Chernomorskogo Kazachestva, 115, Office 507, Odessa, 65003, Ukraine
Intertek USA Finance LLC
c/o CSC Services of Nevada, Inc., 2215-B Renaissance Dr, Las Vegas NV 89919, United States
Intertek Vietnam Limited
3rd & 4th floor, Au Viet Building, No. 01 Le Duc Tho Str., Mai Dich Ward, Cau Giay District, Hanoi City, Vietnam
Intertek West Africa SARL
Rue du Canal de Vridi Face Appontement, SIAP, Abidjan, 15 BP 882, Côte d’Ivoire
Intertek Testing Services de Honduras, S.A.
Edificio la Pradera, locales 5 y 6. 1-2 Ave, 1 calle, Puerto Cortes, Barrio el Centro, Honduras
Intertek West Lab AS
Oljevegen 2, 4056 Tananger, Norway
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 45
23 Principal Group companies Continued
Intertek Genalysis SI Limited
c/o Baoro & Associates, Top Floor, Y. Sato Building, Point Cruz, Honiara, Solomon Islands
ITS (PNG) Limited
Section 27 Allotment 27, Voco Point, Lae, Morobe Province, Papua New Guinea
McPhar Geoservices (Philippines) Inc. (i)
Building 7 & 8 Philcrest 1 Compound, Km23 West Service Road, Bo. Cupang, Muntinlupa City, Philippines
Melbourn Scientific Limited
Melbourn Scientific, Saxon Way, Melbourn, Hertfordshire, Royston, SG8 6DN, United Kingdom
Metoc Limited (iii)
ITS (Subic Bay), Inc.
Area 8 – 10, Lots 11/12 Boton Wharf, Argonaut Highway, Subic Bay, Freeport Zone, Olongapo City, Philippines
Midwest Engineering Services, Inc.
CT Corporation System, 8020 Excelsior Dr., Suite 200, Madison WI 53717, United States
ITS Guinea SARLU
Resident Almamya 103 Community De Kaloum, Conakry, Guinea
ITS Hong Kong NA, Limited (i)
2/F Garment Centre, 576 Castle Peak Road, Kowloon, Hong Kong
ITS Labtest Bangladesh Limited
Phoenix Tower, Plot – 407 (3rd Floor), Tejgaon I/A, Dhaka, Bangladesh
ITS Testing Holdings Canada Limited
9000 Bill Fox Way, Suite 105, Burnaby, British Columbia, V5J 5J3, Canada
ITS Testing Services (UK) Limited
ITS Testing Services Co. LLC
Ras Tanura KSA, PO Box 216, 31941, Saudi Arabia
JLA Brasil Laboratório de Análises de Alimentos S.A.
Rua Carlos Tosin, 860, sala 1, Distrito Industrial, Distrito Industrial, Estado de São Paulo, Brazil
KJ Tech Services GmbH (xii)
Kirschberg 20, 64347, Griesheim, Germany
Laboratorio Fermi S.A. de C.V.
Jacarandes #15, San Clemente, Alvaro Obregon, Ciudad de Mexico, C.P. 01740, Mexico
Laboratorios ABC Química, Investigación y Análisis, S.A. de C.V. (xiii)
Jacarandas #19, San Clemente, Alvaro Obregón, Ciudad de Mexico, C.P. 01740, Mexico
Laboratory Services International Rotterdam B.V.
Pittsburghstraat 9, 3047 BL, Rotterdam, The Netherlands
Labtest International Inc.
545 E. Algonquin Road, Arlington Heights, IL 60005, United States
Lintec Testing Services Limited
Moody (Shanghai) Consulting Co., Ltd
Room 403, No.5-6, Lane 1218, Wanrong Road, Jing ‘an District, Shanghai, China
Moody International (Holdings) Limited (viii)
Moody International (India) Private Limited
E-20, Block B1, Mohan Co-operative Industrial Area, Mathura Road, New Delhi, 110044, India
Moody International (Russia) Limited (ii)
Moody International Certification India Limited
E-20, Block B1, Mohan Co-operative Industrial Area, Mathura Road, New Delhi, 110044, India
Moody International Holdings LLC (xv)
237 Stuart Road, Amelia, LA 70340, United States
Moody United Certification Limited (i)
2F, No. 5 Building, 912 Bibo Road, Zhangjiang Hi-Tech Park,Pudong, Shanghai 201203, China
MT Group LLC
145 Sherwood Avenue, Farmingdale NY 11735, United States
MT Operating of New Jersey, LLC (xv)
145 Sherwood Avenue, Farmingdale NY 11735, United States
MT Operating of New York, LLC (xv)
145 Sherwood Avenue, Farmingdale NY 11735, United States
N T A Monitor Limited
NDT Services Limited
Northern Territory Environmental Laboratories Pty Ltd (i)
544 Bickley Road, Maddington WA 6109, Australia
NTA Monitor (M) Sdn Bhd
No. 18-B, Jalan Kancil off Jalan Pudu, 55100 Kuala Lumpur, Wilayah Persekutuan, Malaysia
Louisiana Grain Services, Inc. (i)
c/o CT Corp, 8550 United Plaza Blvd, Baton Rouge LA 70809, United States
Paulsen & Bayes-Davy Ltd
2/F, Garment Centre, 576 Castle Peak Road, Kowloon, Hong Kong
Mace Land Company, Inc.
3114 Scarboro Road, Street, MD 21154, United States
Management & Industrial Consultancy (i)
59 Road No.104, Second Floor, Maadi, Cairo, Egypt
Management Systems International Limited (i)
Materials Testing Lab, Inc.
145 Sherwood Avenue, Farmingdale NY 11735, United States
Petroleum Services of Union Lab Sdn. Bhd.
Suite C-7-10 (B), Level 9, Block C, UE3 Corporate Offices, Menara Uncang Emas, No 85 Jalan Loke Yew, Taman
Miharja, 55200 Kuala Lumpur, Malaysia
Pittsburgh Testing Laboratory Inc.
PSI, 850 Poplar Street, Pittsburgh PA 15220, United States
Profesionales Contables en Asesoría Empresarial y de Ingenieria S.A.S.
Calle 120, No. 45A – 32, Bogota, Colombia
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 23 Principal Group companies Continued
Professional Service Industries (Canada) Inc. (i)
200 Bay Street, Suite 3800, Royal Bank Plaza, South Tower, Toronto ON M5J 2J7, Canada
Professional Service Industries, Inc.
545 E. Algonquin Road, Arlington Heights, IL 60005, United States
Professional Service Industries Holdings, Inc.
545 E. Algonquin Road, Arlington Heights, IL 60005, United States
PSI Acquisitions, Inc.
545 E. Algonquin Road, Arlington Heights, IL 60005, United States
PT. Moody Technical Services
Graha STR 3rd floor, Suite#302, Jl. Ampera Raya No. 11, Jakarta, 12550, Indonesia
PT. RCG Moody (i)
Graha STR 3rd floor, Suite#302, Jl. Ampera Raya No. 11, Jakarta, 12550, Indonesia
PT. SAI Global Indonesia
Graha Iskandarsyah Lantai 4, Jalan Iskandarsyah Raya Nomor 66-C, Kebayoran Baru, Jakarta, 12160, Indonesia
QMI-SAI Canada Limited
20 Carlson Court, Suite 200, Toronto ON M9W 7K6, Canada
RCG Moody International Uruguay S.A.
Cerrito 507, 4th Floor, Off. 46, 47, Montevideo 11000, Uruguay
SAI Global Assurance Learning Limited
SAI Global Assurance Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
SAI Global Assurance Services Limited
SAI Global Assurance Services sp. z o.o. (i)
Oszczepników 4, 02-633 Warszawa, Poland
SAI Global Australia (China) Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
SAI Global Australia Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
SAI Global Certification Services Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
SAI Global CIS UK Limited
SAI Global Czech s.r.o. (ii)
Vodnická 325/1, Újezd, Prague 4, 149 00, Czech Republic
SAI Global GmbH (ii)
Friedrich-Ebert-Anlage 36, 60325 Frankfurt am Main, Germany
SAI Global GP (xv)
205 W. Wacker Dr, Suite 1800, Chicago, IL 60606, United States
SAI Global, Inc.
615 South DuPont Highway, Dover, DE 19901, United States
46
SAI Global Italia S.R.L.
Corso Tazzoli 235/3, CAP 10137, Turin, Italy
SAI Global Korea Co., Ltd
(Dangjeong-dong, Intertek Building) 3, Gongdan-ro 160beon-gil, Gunpo-si, Gyeonggi-do, Seoul, South Korea
SAI Global Mexico, S. de R.L. de C.V (xvi)
Monte Everest #615, Lomas de Chapultepec, Ciuda de Mexico, Distrito Federal, 11000, Mexico
SAI Global Pty Limited
544 Bickley Road, Maddington WA 6109, Australia
SAI Global SARL
29 Rue du Pont, 92200 Neuilly-sur-Seine, France
SAI Global UK Holdings Limited
SAI Global US Holdings, Inc.
205 W. Wacker Dr, Suite 1800, Chicago, IL 60606, United States
Schindler & Associates (L.C.) (i) (xv)
24900 Pitkin Road, Suite 200, The Woodlands TX 77386, United States
Shanghai Orient Intertek Testing Services Company Limited
3F, No 15-16, Lane 1988 Changzhong Road, Shanghai, China
Shanghai Tianxiao Investment Consultancy Company Limited
Room 502, No.5-6, 1218 WanRong Road, Shanghai 200070, China
Technical Company for Testing and Conformity Services & Systems LLC
Gates No. 1/2/6, Building 73/ Area 903, Karadah, Al Rusafa, Baghdad, Iraq
Testing Holdings Sweden AB
Torshamnsgatan 43, Box 1103, Kista, S-164 22, Sweden
Tradegood.com International Limited (i)
2/F, Garment Centre, 576 Castle Peak Road, Kowloon, Hong Kong
Van Sluys & Bayet NV
Kruisschansweg 11, 2040 Antwerp, Belgium
White Land Company, Inc.
3114 Scarboro Road, Street, MD 21154, United States
Wilson Inspection X-Ray Services, Inc.
Michael E Wilson, 6010 Edgewater Dr., Corpus Christi TX 78412, United States
Wisco SE Asia PTE Limited (i)
3 Irving Road #05-01 to 05, Tai Seng Centre, 369522, Singapore
Youngever Holdings Ltd
Ritter House, Wickhams Cay II, Road Town, Tortola, VG 1110, British Virgin Islands
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 47
23 Principal Group companies Continued
Related undertakings where the effective interest is less than 100%
Caleb Brett Abu Dhabi LLC (xviii) (xix) (49.0%)
CB UAE (Private) Ltd, c/o Al Nahiya Group, PO Box 3728, Abu Dhabi, United Arab Emirates
Clean Energy Associates, LLC (xv) (85.0%)
16192 Coastal Highway, Lewes, DE, 19958, United States
Clean Energy Associates Limited (85.0%)
302-308 Hennessy Road, Room 2003, Wanchai, Hong Kong
Clean Energy Associates (China) Limited (85.0%)
Room 159, Building 4th, No. 2118 Guanghua Road, Minhang District, Shanghai, China
CQC-SAI Management Technologies (Beijing) Co., Ltd (70%)
Level 21, Suite 2101-2103A, Beijing AVIC Building, No 10B, East 3rd Ring Road, Chaoyang District, Beijing
100022, China
Euro Mechanical Instrument Services LLC (xix) (49.0%)
PO Box 46153, Abu Dhabi, United Arab Emirates
International Inspection Services LLC (xviii) (70.0%)
PO Box 193, Al Hamriyah, Muscat, PC 131, Oman
Intertek (Qeshm Island) Limited (51.0%)
Unit 107, Goldis Building, Valiasr Boulevard, Qeshm Island, Islamic Republic of Iran
Intertek Angola LDA (99.0%)
282 Rua Amilcar Cabral no.147 2nd floor, Apartment Z, Luanda, Angola
Intertek Caleb Brett Tzn Limited (75%)
Plot number 5, Minizani str.-Opposite Roman Catholic Church, Kilwa Road, Kurasini Temeke, Dar Es Salaam,
15109, United Republic of Tanzania
Intertek Certification International Sdn. Bhd. (xix) (40%)
6-L12-01, Level 12, Tower 2, Menara PGRM, No. 6 & 8 Jalan Pudu Ulu, Cheras, 56100 Kuala Lumpur, Malaysia
Intertek Engineering Service Shanghai Limited (90%)
Room 301-6, No.14, Lane 1401, Jiangchang Road, Jing ’an District, Shanghai, China
Intertek ETL SEMKO KOREA Limited (90.0%)
5F, Intertek building, Gongdan-ro, 160beon-gil 3, Gunpo-si, Gyeonggi-do, 15845, South Korea
Intertek Geronimo JV Limited (i) (70.0%)
1, North Industrial Area, Klan Street, Accra, Ghana
Intertek Global International LLC (xv) (xix) (49%)
Building 242, Office No.3, C-Ring Road, Doha, PO Box 47146, Qatar
Intertek GM Testing Service Zhuhai Co., Ltd (70.0%)
6F of Research and Development Building, Guangdong-Macau TCM Park Commercial Service Center, 2682
Huan Dao Bei Road, Hengqin New Area, Zhuhai, Guangdong China
Intertek Industry Services (PTY) LTD (69.9%)
3 EL Wak Street, Vereeniging, 1930, Gauteng, South Africa
Intertek Industry Services Colombia Limited (99.0%)
Calle 127A No. 53A-45, Oficina 1103, Bogotá, Colombia
Intertek Inspection (Malaysia) Sdn. Bhd. (xi) (xix) (40%)
D-28-3, Level 28, Menara Suezcap 1, No. 2 Jalan Kerinchi, Gerbang Kerinchi Lestari, 59200 Kuala Lumpur,
Malaysia
Intertek Kimsco Co., Ltd (50.0%)
9F, Hansan Building, 115, Seosomun-ro, Jung-gu, Seoul, 04515, South Korea
Intertek Lanka (Private) Limited (70.0%)
Intertek House, No: 282, Kaduwela Road, Battaramulla, Sri Lanka
Intertek Libya Technical Services and Consultations Company Spa (65.0%)
P.O Box 3788, Hay Alandalus, Gargaresh, Tripoli, Libya
Intertek Life Bridge (Shanghai) Testing Services Co., Ltd (80.0%)
4F, No.6 BLD, Lane 1218,Wanrong Road, Shanghai 200070, China
Intertek Ltd (99.9%)
Borco Administration Bldg, West Sunrise Highway, Freeport, Grand Bahama, The Bahamas
Intertek – QNP LLP (xvii) (51.0%)
Building 2A, Abay street, Atyrau City, 060002, Kazakhstan
Intertek Robotic Laboratories Pty Limited (50.0%)
544 Bickley Road, Maddington WA 6109, Australia
Intertek South Africa Holdings (Pty) Ltd (75.0%)
5th Floor, Charter House, 13 Brand Road, Glenwood, Kwazulu-Natal, South Africa
Intertek Test Hizmetleri Anonim Sirketi (85.0%)
Merkez Mahallesi, Sanayi Cad. No.23, Altindag Plaza, Yenibosna-34197, Istanbul, Turkey
Intertek Testing Services (South Africa) (Proprietary) Limited (xi) (xix) (49.5%)
5th Floor, Charter House, 13 Brand Road, Glenwood, Durban, South Africa
Intertek Testing Services Changzhou Ltd (85.0%)
Room 201, No 4 Floor, Changzhou Testing Industrial Park, Tanning District, Changzhou, China
Intertek Testing Services Korea Limited (50.0%)
1st Fl., Aju Digital Tower, 284-56, Seongsu-dong 2-ga, Seongdong-gu, Seoul 133-120, South Korea
Intertek Testing Services Nigeria Limited (60.0%)
73B Marine Road, Apapa GRA, Apapa, Lagos, 102272, Nigeria
Intertek Testing Services Sichuan Co., Ltd (90.0%)
No 1, Jiuxiang Blvd, Pharmacy Industry Park, Luzhou National High Technology District, Sichuan, China
Intertek Testing Services Wuxi Ltd (70.0%)
1/F, No.8 Fubei Road, Xishan Economic Development Zone, Wuxi, Jiangsu, 214101, China
ITS Caleb Brett Deniz Survey A S (50.0%)
Ulus Mah. Oz Topuz cad. no.32, Besiktas, Istanbul, 34340, Turkey
ITS Testing Services (M) Sdn Bhd (74.0%)
Unit 30-01, Level 30, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No.8, Jalan Kerinchi, 59200
Kuala Lumpur, Malaysia
ITS Testing Services Holdings (M) Sdn Bhd (xix) (49.0%)
Unit 30-01 Level 30, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8, Jalan Kerinchi, 59200
Kuala Lumpur, Malaysia
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents 48
Associates
Moody International Certification Ltd (40.0%)
53, Nautic, Triq l-Ortolan, San Gwann, SGN 1943, Malta
Moody Certification Maroc SARL(30.0%)
28, Rue de Provins, 2 eme etage, Casablanca, Morocco
Moody International SA (35.0%)
4 Rue Des Brasseurs, Zone 3 Abidjan, Côte d’Ivoire
Dormant.
In Liquidation/Strike off requested.
Ownership held in class A, B, C, D and E common shares.
(i)
(ii)
(iii) Ownership held in class A and B common shares
(iv) Ownership held in class A and E shares.
(v)
(vi) Ownership held in class A, B, C, D, E and F shares.
(vii) Ownership held in ordinary and ordinary-A shares.
(viii) Ownership held in ordinary, ordinary-A, ordinary-B and deferred shares.
(ix) Ownership held in ordinary and preference shares.
(x)
Ownership held in ordinary and redeemable shares.
(xi) Ownership held in ordinary and redeemable preference shares.
(xii) Ownership held in No.1, No.2.1 and No.2.2 shares.
(xiii) Ownership held in class I Series B shares and class II Series B shares.
(xiv) Ownership held in ordinary bearer shares.
(xv) Ownership held in membership units.
(xvi) Ownership held in quota capital shares.
(xvii) Ownership held in charter capital.
(xviii) The Group obtains 99% of the economic benefit of the company.
(xix)
Intertek has de facto control of the company.
23 Principal Group companies Continued
Moody International Angola Ltda (i) (xvi) (78.6%)
Rua de Macau, Edifico ex Edil Apto 1, Res de Chao Esq. C.P 215, Cabinda, Angola
Moody International Bangladesh Limited (99.9%)
House 6, Road 17/A, Block E, Ground Floor, Banani, Dhaka, 1213, Bangladesh
Moody International Holdings Chile Ltda (99.0%)
Avenida Las Condes N° 11287 Torre A, oficina 301 A Las Condes, Santiago, Chile
Moody International Lanka (Private) Ltd (99.9%)
No.5, St Albans Place, Colombo-4, Sri Lanka
Moody International Philippines, Inc. (i) (92.5%)
Intertek Building, 2310 Chino Roces Avenue Extension, Metro Manila, Makati City, 1231, Philippines
PT Citrabuana Indoloka (50.0%)
Jl. Raya Bogor KM 28, RT/RW. 04/07, Kel. Pekayon, Kec. Pasar Rebo, Jakarta Timur, 13710, Indonesia
PT. Global Assurance Services (ii) (99.8%)
Graha Iskandarsyah Raya No.66-C, Jakarta, 12160, Indonesia
PT. Intertek Utama Services (xix) (49.0%)
Jl. Raya Bogor KM. 28, RT/RW. 04/07, Kel. Pekayon, Kec. Pasar Rebo, Jakarta Timur, 13710, Indonesia
Qatar Calibration Services LLC (xix) (49.0%)
Petrotec, PO Box 16069, 8th Floor, Toyota Tower, Doha, Qatar
RCG Moody International de Venezuela S.A. (i) (99.0%)
Res Morgana, p_4, #04, Av.Andres Bello, Fco de Miranda, Los Polos Grandes, Caracas, Venezuela
SAI Global (Cyprus) Holdings Limited (60.0%)
1 Lampousas Street, 1095 Nicosia, Cyprus
SAI Global Eurasia Limited (60.0%)
19 Lit A, 7 Quarter River Wolves, 192102 St. Petersburg, Russian Federation
SAI Global Japan Co. Ltd. (68.0%)
MK Bldg. 8F, 2-28-22 Shiba, Minato-ku Tokyo, Japan
Shanghai Moody Management & Technical Services Co. Ltd (i) (90.0%)
Room 225, No. 14 at Lane No. 1700 Luo Shan Road, Shanghai, China
Société SAI Global Tunisia SARL (75.0%)
67, Avenue Alain Savary, Cite les Jardins 2 Bloc A, Tunis, Tunisia
Société Tunisienne Intertek Caleb Brett SARL (51.0%)
67 rue Ech-Chem, Tunis, 1002, Tunisia
The Wine Warehouse (Chepstow) Management Company Limited (75%)
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the financial statements ContinuedContents
Intertek Group plc – Company balance sheet
49
As at 31 December
Fixed assets
Investments in subsidiary undertakings
Current assets
Debtors due within one year
Cash at bank and in hand
Creditors due within one year
Other creditors
Net current assets
Total assets less current liabilities
Net assets
Capital and reserves
Called up share capital
Share premium
Profit and loss reserves
Total shareholders’ funds
The profit for the financial year was £142.9m (2021: £163.2m).
The financial statements on pages 49 to 53 were approved by the Board on 27 February 2023 and were signed on its behalf by:
André Lacroix
Chief Executive Officer
Company number: 04267576
Jonathan Timmis
Chief Financial Officer
Notes
2022
£m
2021
£m
(E)
354.3
347.3
(F)
(G)
(H)
(H)
(H)
387.4
387.4
0.2
387.6
(7.4)
(7.4)
380.2
734.5
408.1
408.1
1.1
409.2
(5.5)
(5.5)
403.7
751.0
734.5
751.0
1.6
257.8
475.1
734.5
1.6
257.8
491.6
751.0
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Intertek Group plc – Company statement of changes in equity
50
At 1 January 2021
Total comprehensive income for the year
Profit
Total comprehensive income for the year
Transactions with owners of the Company recognised directly in equity
Contributions by and distributions to the owners of the Company
Dividends paid
Purchase of own shares
Tax paid on Share Awards vested
Equity-settled transactions
Total contributions by and distributions to the owners of the Company
At 31 December 2021
At 1 January 2022
Total comprehensive income for the year
Profit
Total comprehensive income for the year
Transactions with owners of the Company recognised directly in equity
Contributions by and distributions to the owners of the Company
Dividends paid
Purchase of own shares
Tax paid on Share Awards vested
Equity-settled transactions
Total contributions by and distributions to the owners of the Company
At 31 December 2022
Notes
Share capital
£m
Share
premium
£m
Profit and
loss reserves
£m
Total
equity
£m
1.6
257.8
497.6
757.0
(B)
(D)
(E)
(B)
(D)
(E)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
163.2
163.2
163.2
163.2
(170.6)
(11.4)
(5.8)
18.6
(170.6)
(11.4)
(5.8)
18.6
(169.2)
(169.2)
1.6
257.8
491.6
751.0
1.6
257.8
491.6
751.0
–
–
–
–
–
–
–
–
–
–
–
–
–
–
142.9
142.9
142.9
142.9
(170.6)
(2.3)
(4.0)
17.5
(170.6)
(2.3)
(4.0)
17.5
(159.4)
(159.4)
1.6
257.8
475.1
734.5
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 51
Notes to the Company financial statements
(A) Accounting policies – Company
The following accounting policies have been applied consistently in dealing with items which are considered
material in relation to the Company’s financial statements.
Basis of preparation
These financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced
Disclosure Framework (‘FRS 101’) in conformity with the requirements of the Companies Act 2006.
These financial statements have been prepared on a historical cost basis. The Company continues to adopt
the going concern basis of accounting in preparing these financial statements. Further detail on going concern
can be found in note 1 to the Group financial statements.
In preparing these financial statements, the Company applies the recognition, measurement and disclosure
requirements of UK-adopted International Accounting Standards (‘Adopted IFRSs’), but makes amendments
where necessary in order to comply with Companies Act 2006 and has set out below where advantage of
the FRS 101 disclosure exemptions has been taken.
These financial statements are presented in sterling, which is the functional currency of the Company.
All information presented in sterling has been rounded to the nearest £0.1m.
In these financial statements, the Company has applied the exemptions available under FRS 101 in respect
of the following disclosures:
• a cash flow statement and related notes;
• comparative period reconciliations for share capital;
• disclosures in respect of transactions with wholly owned subsidiaries;
• disclosures in respect of capital management;
• the effects of new, but not yet effective, IFRSs;
• an additional balance sheet for the beginning of the earliest comparative period following the retrospective
change in accounting policy;
• disclosures in respect of the compensation of Key Management Personnel; and
• certain disclosures required by IFRS 13 Fair Value Measurement and the disclosures required by IFRS 7
Financial Instrument Disclosures on the basis that the consolidated financial statements include the
equivalent disclosures.
As the consolidated financial statements include the equivalent disclosures, the Company has also taken the
exemptions under FRS 101 available in respect of IFRS 2 Share-Based Payment in respect of Group-settled
share-based payments.
The Company proposes to continue to adopt the reduced disclosure framework of FRS 101 in its next
financial statements.
Foreign currencies
Transactions in foreign currencies are recorded to the Company’s functional currency, sterling, using the rate
of exchange ruling at the date of the transaction. Monetary assets and liabilities in foreign currencies are
translated into sterling at the rates of exchange prevailing at the balance sheet date. All foreign exchange
differences are taken to the profit and loss account.
Taxation
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the profit and
loss account except to the extent that it relates to items recognised directly in equity or other comprehensive
income, in which case it is recognised directly in equity or other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates
enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of
previous years.
Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for taxation purposes. The following temporary differences
are not provided for: the initial recognition of goodwill; the initial recognition of assets or liabilities that affect
neither accounting nor taxable profit other than in a business combination; and differences relating to
investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The
amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying
amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be
available against which the temporary difference can be utilised.
Dividends on shares presented within shareholders’ funds
Dividend income is recognised in profit or loss on the date that the Company’s right to receive payment is
established. Dividends unpaid at the balance sheet date are only recognised as a liability at that date to
the extent that they are appropriately authorised and are no longer at the discretion of the Company.
Unpaid dividends that do not meet these criteria are disclosed in the notes to the financial statements.
Investments in subsidiaries
Investments in subsidiaries are stated at cost less any provisions for impairment.
Intercompany financial guarantees
When the Company enters into financial guarantee contracts to guarantee the indebtedness of other
companies in the Group, the Company considers these to be insurance arrangements and accounts for them
as such. In this respect the Company treats the guarantee contract as a contingent liability, until such time
as it becomes probable that the Company will be required to make a payment under the guarantee.
Under Section 408 of the Companies Act 2006 the Company is exempt from the requirement to present its
own profit and loss account.
Share-based payments
Intertek Group plc runs a share ownership programme that allows Group employees to acquire shares in the
Company. Details of the share schemes are given in note 17 of the Group financial statements.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods
presented in these financial statements.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 52
(D) Dividends
The aggregate amount of dividends comprises:
Final dividend paid in respect of prior year but not recognised as a liability
in that year
Interim dividends paid in respect of the current year
Aggregate amount of dividends paid in the financial year
2022
£m
2021
£m
115.5
55.1
170.6
115.5
55.1
170.6
The aggregate amount of dividends proposed and recognised as liabilities as at 31 December 2022 is £nil
(2021: £nil). The aggregate amount of dividends proposed and not recognised as liabilities as at 31 December
2022 is £115.5m (2021: £115.6m).
(E) Investment in subsidiary undertakings
Cost and net book value
At 1 January
Additions due to share-based payments
Recharges of share-based payments to subsidiaries
At 31 December
2022
£m
2021
£m
347.3
17.5
(10.5)
354.3
342.2
18.6
(13.5)
347.3
The Company has made Share Awards to the employees of its directly and indirectly owned subsidiaries, and as
such, the Company recognises an increase in the cost of investment in subsidiaries of £17.5m (2021: £18.6m).
Details of the principal operating subsidiaries are set out in note 23 to the Group financial statements.
The Company had two direct subsidiary undertakings at 31 December 2022: Intertek Testing Services
Holdings Limited and Intertek Holdings Limited, both of which are holding companies, are incorporated in the
United Kingdom and registered in England and Wales. All interests are in the ordinary share capital and all are
wholly owned. In the opinion of the Directors, the value of the investments in subsidiary undertakings is not
less than the amount at which the investments are stated in the balance sheet.
There is no impairment to the carrying value of these investments (2021: £nil).
(A) Accounting policies – Company Continued
Investments impairment review
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and
subsequently measured at cost less any accumulated impairment losses. Estimates are used in determining
the level of investment that will not, in the opinion of the Directors, be recoverable.
Recoverability of receivables
Amounts owed by Group undertakings are recognised initially at the value of the invoice or loan raised and
subsequently at the amounts considered recoverable (amortised cost). Estimates are used in determining
the level of receivables that will not, in the opinion of the Directors be collected. The Company applies the
simplified approach permitted by IFRS 9, which requires the use of the lifetime expected loss provision for
all receivables. The provision calculations are based on a review of all receivables to see if there are specific
circumstances which would render the receivable irrecoverable and therefore require a specific provision.
Significant new accounting policies and standards
No significant new accounting policies or standards were adopted in the year ending 2022.
(B) Profit and loss account
Amounts paid to the Company’s auditors and their associates in respect of services to the Company, other than
the audit of the Company’s financial statements, have not been disclosed as the information is required instead
to be disclosed on a consolidated basis. The Company does not have any employees (2021: nil).
Details of the remuneration of the Directors are set out in the Remuneration report in Book two, pages 78 to 103.
(C) Use of judgements and estimates
In the application of the Company’s accounting policies, the Directors are required to make judgements,
estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent
from other sources.
The estimates and associated assumptions are based on historical experience and other factors that are
considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised, if the revision affects only that period,
or in the period of the revision and future periods if the revision affects both current and future periods.
The assumptions which have a significant risk of causing a material adjustment to the carrying amount
of assets and liabilities are outlined below. There are no critical estimates which have a significant risk of
causing a material adjustment to the carrying amount of assets and liabilities in the next financial year.
Key Estimations and Uncertainties
There are no critical accounting judgements or estimates.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the Company financial statements ContinuedContents (I) Related party transactions
Details of related party transactions are set out in note 21 of the Group financial statements.
(J) Contingent liabilities
The Company is a member of a group of UK companies that are part of a composite banking cross-guarantee
arrangement. This is a joint and several guarantee given by all members of the Intertek UK cash pool,
guaranteeing the total gross liability position of the pool which was £0.8m at 31 December 2022 (2021: £0.4m).
From time to time, in the normal course of business, the Company may give guarantees in respect of certain
liabilities of subsidiary undertakings.
(K) Subsequent events
Details of post-balance sheet events relevant to the Company and the Group are given in note 18 of the Group
financial statements.
(F) Debtors due within one year
Amounts owed by Group undertakings – due within one year
Total debtors
53
2022
£m
387.4
387.4
2021
£m
408.1
408.1
The amounts owed by Group undertakings are unsecured, have no fixed date of repayment and are repayable
on demand. A mixture of the amounts due are interest bearing and interest free.
(G) Creditors due within one year
Trade and other creditors
Income tax payable
Amounts owed to Group undertakings
Total creditors
2022
£m
3.7
3.5
0.2
7.4
2021
£m
2.1
2.9
0.5
5.5
The amounts owed to Group undertakings are unsecured, have no fixed date of repayment and are repayable
on demand. A mixture of the amounts due are interest bearing and interest free.
(H) Statement of changes in equity
Details of share capital are set out in note 15 and details of share-based payments are set out in note 17 to
the Group financial statements.
A profit and loss account for Intertek Group plc has not been presented as permitted by Section 408 of the
Companies Act 2006. The profit for the financial year, before dividends paid to shareholders of £170.6m
(2021: £170.6m), was £142.9m (2021: £163.2m) which was mainly in respect of dividend income in relation
to 2022.
The Company has sufficient distributable reserves to pay the 2022 final dividend and the anticipated 2023
interim dividend. When required, the Company can receive additional dividends from its subsidiaries to further
increase distributable reserves.
The Group settled in cash the tax element of the Share Awards vested in 2022 amounting to £4.4m (2021:
£6.7m) of which the Company settled £4.0m (2021: £5.8m).
During the year ended 31 December 2022, the Company purchased, through its Employee Benefit Trust,
45,000 (2021: 216,310) of its own shares with an aggregate nominal value of £450 (2021: £2,163) for
£2.3m (2021: £11.4m) which was charged to profit and loss reserves.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeNotes to the Company financial statements ContinuedContents 54
Independent Auditors’ Report
to the members of Intertek Group plc
Report on the audit of the financial statements
Opinion
In our opinion:
• Intertek Group plc’s group financial statements and company financial statements (the “financial
statements”) give a true and fair view of the state of the group’s and of the company’s affairs as at
31 December 2022 and of the group’s profit and the group’s cash flows for the year then ended;
• the group financial statements have been properly prepared in accordance with UK-adopted international
accounting standards as applied in accordance with the provisions of the Companies Act 2006;
• the company financial statements have been properly prepared in accordance with United Kingdom
Generally Accepted Accounting Practice (United Kingdom Accounting Standards, including FRS 101
“Reduced Disclosure Framework”, and applicable law); and
• the financial statements have been prepared in accordance with the requirements of the Companies
Act 2006.
We have audited the financial statements, included within the Annual Report & Accounts (the “Annual
Report”), which comprise: the consolidated statement of financial position and company balance sheet as at
31 December 2022; the consolidated income statement, consolidated statement of comprehensive income,
consolidated statement of cash flows, consolidated statement of changes in equity and company statement
of changes in equity for the year then ended; and the notes to the financial statements, which include a
description of the significant accounting policies.
Our opinion is consistent with our reporting to the Audit Committee.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and
applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities
for the audit of the financial statements section of our report. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We remained independent of the group in accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard, as applicable
to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with
these requirements.
To the best of our knowledge and belief, we declare that non-audit services prohibited by the FRC’s Ethical
Standard were not provided.
Other than those disclosed in the Audit Committee report within the Directors’ report, we have provided
no non-audit services to the company or its controlled undertakings in the period under audit.
Our audit approach
Overview
Audit scope
• We performed full scope audit procedures over 55 legal entities and performed specific audit procedures
on a further two entities, covering 23 territories in total.
• Taken together, the entities over which audit work was performed accounted for 74% of the group’s
revenue and 78% of the group’s statutory profit before tax.
Key audit matters
• Impairment of goodwill (group)
• Valuation of defined benefit pension scheme liabilities (group)
• Impairment of investments in subsidiary undertakings (parent)
Materiality
• Overall group materiality: £20,800,000 (2021: £20,650,000) based on 5% of profit before tax.
• Overall company materiality: £7,400,000 (2021: £7,500,000) based on 1% of total assets.
• Performance materiality: £15,000,000 (2021: £15,450,000) (group) and £5,500,000
(2021: £5,625,000) (company).
The scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material misstatement
in the financial statements.
Key audit matters
Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance
in the audit of the financial statements of the current period and include the most significant assessed risks
of material misstatement (whether or not due to fraud) identified by the auditors, including those which had the
greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts
of the engagement team. These matters, and any comments we make on the results of our procedures thereon,
were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters.
This is not a complete list of all risks identified by our audit.
SAI Global Assurance acquisition accounting in relation to the valuation of intangible assets and Uncertain
tax positions, which were key audit matters last year, are no longer included because of the fact that the
SAI Global Assurance acquisition was a non-recurring transaction for the prior year and the risk and magnitude
of the uncertain tax position has reduced since last year following the resolution of the individually largest
uncertain tax position in 2021. Otherwise, the key audit matters below are consistent with last year.
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Key audit matter
How our audit addressed the key audit matter
Key audit matter
How our audit addressed the key audit matter
55
Impairment of goodwill (group)
Refer to the Audit Committee report in Book two,
page 77 and to note 9 in the financial statements.
The group had £1,418.4 million of goodwill
recognised on the balance sheet at 31 December
2022. The potential impairment of goodwill is
dependent on future cash flows of the underlying
Cash Generating Units (“CGUs”) and there is a risk
that, if these cash flows are not sufficient to support
the carrying value, the assets may be impaired.
Having considered the industry environments and
business performance, we consider that the CGUs for
Industry Services, Caleb Brett and Transportation
Technologies represent an elevated risk of
impairment, requiring greater audit effort.
Accounting standards require management to
perform an annual assessment of the carrying value
of goodwill.
As this assessment is based on the future value in
use, and a significant amount of value is based on
the value to perpetuity of the CGUs, future cash
flows must be estimated, which can be highly
judgemental and could significantly impact the
carrying value of the assets.
We evaluated management’s cash flow
forecasts and understood the process by which
they were determined and approved. This
included confirming that the forecasts were
consistent with the latest Board approved
budgets and checking the methodology and
mathematical accuracy of the underlying
calculations, with no exceptions identified.
We evaluated the inputs included in the value in use
calculations and challenged the key assumptions
for the higher risk CGUs – Industry Services, Caleb
Brett and Transportation Technologies, by obtaining
evidence including in respect of the following:
• the growth rates used in the cash flow forecasts
by comparing them with historical results, external
forecasts and our understanding of the business;
• using our internal valuation experts to evaluate
the discount rate by comparing the cost of capital
for the group with comparable organisations; and
• the long-term growth rates by comparing these
with publicly available market data on projected
growth rates in key territories such as the UK, USA
and China.
We performed sensitivity analyses around these
assumptions. We also challenged the extent to
which climate change considerations had been
reflected, as appropriate, in management’s
impairment assessment process.
Having ascertained the extent of change in
those assumptions that either individually
or collectively would be required for an
impairment to arise, we considered the
likelihood of such a movement occurring.
Our testing did not identify any impairment and
confirmed that it would require significant downside
changes before any impairment would be triggered.
In addition, we assessed the appropriateness
of the CGUs used in the impairment
assessment and the related disclosures and
concluded that these were appropriate.
Valuation of defined benefit pension scheme
liabilities (group)
Refer to the Audit Committee report in Book two,
page 77 and to note 16 in the financial statements.
We utilised our internal actuarial experts to evaluate
whether the assumptions and methodology used in
calculating the pension liabilities were reasonable, by:
• Assessing whether salary increases and mortality
rate assumptions were reasonable based on the
consideration of the specifics of each plan, pension
plans of similar maturity to the group’s and
industry benchmarks;
• Evaluating the consistency of the discount and
inflation rate assumptions with our internally
developed benchmarks based on national data; and
• Reviewing the methodology and calculations
prepared by external actuaries to assess their
appropriateness and the consistency of the
assumptions used.
Based on our procedures, we concluded that the
key assumptions utilised lay within acceptable
ranges and that the methodology was appropriate.
We assessed the related disclosures included in the
group financial statements and concluded that these
were appropriate.
We evaluated management’s assessment
of impairment indicators and considered the
consistency with other audit procedures performed.
We concluded management’s view that no
impairment indicators exist was reasonable.
The group had two major pension schemes in
the United Kingdom and Switzerland. The United
Kingdom scheme has a net surplus of £21.3 million
and the Switzerland scheme has a net deficit of
£2.2 million. They were recognised on the balance
sheet at 31 December 2022.
The valuation of pension liabilities involves the
exercise of judgement and technical expertise in
choosing appropriate actuarial assumptions such as
the discount rate, inflation level, mortality rates and
salary increases.
Management engaged external actuarial experts
to assist them in selecting appropriate assumptions
and to calculate the liabilities. The methodologies
and assumptions utilised are judgemental and
could significantly impact the magnitude of the
liabilities recognised.
Impairment of investments in subsidiary
undertakings (parent)
Refer to note E in the financial statements.
The parent company had £354.3 million of
investments in subsidiary undertakings. There
is a risk that the performance of the subsidiary
undertakings is not sufficient to support the
carrying value and the assets may be impaired.
Management has performed an assessment of
impairment indicators with none being identified.
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Independent Auditors’ Report Continued
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion
on the financial statements as a whole, taking into account the structure of the group and the company,
the accounting processes and controls, and the industry in which they operate.
The impact of climate risk on our audit
As part of our audit we have made enquiries of management to understand the process they adopted
to assess the extent of the potential impact of climate risk on the financial statements and support
the disclosures made in relation to climate risk within the Strategic report and Sustainability report.
The group is split into three reporting segments: Products, Trade and Resources and the operations are spread
across over 100 territories and approximately 600 legal entities. The results are not consolidated at a territory
or regional level, so we determined that the most appropriate level at which to scope our audit was the legal
entity level.
When determining our scope, the key financial measure used was profit before tax. Due to the disaggregation
of the group’s results across the various entities, we identified two individually financially significant legal
entities, one within China and one within the United States. As a result, we instructed our component teams
to perform audits of the complete financial information of these entities.
We considered the territories in which PwC is appointed statutory auditor. Of these, 19 territories (including
China) accounted for the majority of external profit, and we therefore focused our considerations on these
territories. Within these territories, we then excluded any legal entities with no external balances, such as
intermediate holding companies, and those entities with highly immaterial revenue. This left 45 legal entities
(including the one financially significant legal entity in China) for which we instructed our local teams to
perform audits of the complete financial information for the purpose of the group audit. In addition, we
performed full scope audit procedures over two head office legal entities.
In certain territories, notably the United States and Canada, there is no statutory audit requirement and so we
considered whether procedures needed to be performed to supplement our coverage. We selected eight of the
largest entities in the United States and Canada for full scope audits (including the one financially significant
legal entity in the United States), representing those with the largest contribution to group profit.
In addition to enquiries with management, we also read the Carbon Disclosure Project public submission
made by the group.
We assessed the completeness of management’s climate risk assessment by:
• reading external reporting made by management including the Carbon Disclosure Project submissions
and making management aware of any internal inconsistencies in their climate reporting; and
• challenging the consistency of management’s climate impact assessment with internal board minutes,
including whether the time horizons management have used take account of the relevant aspects of
climate change such as transition risks.
The Board has made commitments to get to net zero carbon emissions by 2050.
Management has assessed that there is no material impact on the financial reporting judgement and estimates
arising from their considerations, consistent with their assessment of no material impact of climate-related
policies directly on the business.
Using our knowledge of the business, we evaluated management’s risk assessment, its estimates as set out in
note 1 of the financial statements and resulting disclosures where significant. In particular we have considered
how climate risk would impact the assumptions made in the forecasts prepared by management used in their
impairment analyses, as referenced in the key audit matter in relation to the impairment of goodwill above.
We also considered the consistency of the disclosures in relation to climate change within the Strategic report
and the Sustainability report with the financial statements and our knowledge obtained from the audit.
We identified a further two legal entities in Brazil and Saudi Arabia over which we instructed specific audit
procedures to be performed over revenue and receivables to supplement coverage over these key financial
statement line items.
Our procedures did not identify any material impact in the context of our audit of the financial statements
as a whole, or our key audit matters, for the year ended 31 December 2022.
In total we performed procedures relating to 57 legal entities in 23 territories, which together accounted
for 74% of the group’s revenue and 78% of the group’s profit before tax.
This, together with additional procedures performed at the group level (including audit procedures over
business acquisitions, impairment assessments, defined benefit pension schemes, tax and consolidation
adjustments), gave us the evidence we needed for our opinion on the financial statements as a whole.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 57
Independent Auditors’ Report Continued
Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds
for materiality. These, together with qualitative considerations, helped us to determine the scope of our audit
and the nature, timing and extent of our audit procedures on the individual financial statement line items and
disclosures and in evaluating the effect of misstatements, both individually and in aggregate on the financial
statements as a whole.
Conclusions relating to going concern
Our evaluation of the directors’ assessment of the group’s and the company’s ability to continue to adopt
the going concern basis of accounting included:
• An assessment of management’s base case and severe but plausible scenarios, challenging the key assumptions;
• Considering the group’s available financing, including related covenants, and maturity profile to assess
liquidity through the assessment period;
• Testing the mathematical integrity of the forecasts and the models and reconciled these to Board approved
Based on our professional judgement, we determined materiality for the financial statements as a whole
as follows:
budgets; and
• Performing our own independent sensitivity analysis to assess appropriate downside scenarios.
Financial statements – group
Financial statements – company
Overall materiality
£20,800,000 (2021: £20,650,000).
£7,400,000 (2021: £7,500,000).
How we determined it
5% of profit before tax
1% of total assets
Based on the work we have performed, we have not identified any material uncertainties relating to events or
conditions that, individually or collectively, may cast significant doubt on the group’s and the company’s ability
to continue as a going concern for a period of at least twelve months from when the financial statements are
authorised for issue.
Rationale for benchmark
applied
We believe that profit before tax is the
primary measure used by the
shareholders and users of the financial
statements in assessing the
performance of the Group. This is a
generally accepted benchmark.
These are a single set of company
accounts for an entity which has no
external revenue and takes advantage
of the exemption offered under S408
of Companies Act 2006 not to present
its income statement in its financial
statements, which are presented
alongside the group financial
statements within the Annual Report.
As a result, the determination of
materiality was based on the total
assets of this non-trading holding
company within the group.
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis
of accounting in the preparation of the financial statements is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as
to the group’s and the company’s ability to continue as a going concern.
In relation to the directors’ reporting on how they have applied the UK Corporate Governance Code, we have
nothing material to add or draw attention to in relation to the directors’ statement in the financial statements
about whether the directors considered it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in
the relevant sections of this report.
For each component in the scope of our group audit, we allocated a materiality that is less than our overall
group materiality. The range of materiality allocated across components was between £1.1 million and
£7.5 million. Certain components were audited to a local statutory audit materiality that was also less than
our overall group materiality.
We use performance materiality to reduce to an appropriately low level the probability that the aggregate
of uncorrected and undetected misstatements exceeds overall materiality. Specifically, we use performance
materiality in determining the scope of our audit and the nature and extent of our testing of account balances,
classes of transactions and disclosures, for example in determining sample sizes. Our performance materiality
was 75% (2021: 75%) of overall materiality, amounting to £15,000,000 (2021: £15,450,000) for the group
financial statements and £5,500,000 (2021: £5,625,000) for the company financial statements.
In determining the performance materiality, we considered a number of factors – the history of misstatements,
risk assessment and aggregation risk and the effectiveness of controls – and concluded that an amount in the
middle of our normal range was appropriate.
We agreed with the Audit Committee that we would report to them misstatements identified during our audit
above £1,000,000 (group audit) (2021: £1,100,000) and £1,000,000 (company audit) (2021: £1,100,000) as
well as misstatements below those amounts that, in our view, warranted reporting for qualitative reasons.
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Independent Auditors’ Report Continued
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial
statements and our auditors’ report thereon. The directors are responsible for the other information, which
includes reporting based on the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.
Our opinion on the financial statements does not cover the other information and, accordingly, we do not
express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of
assurance thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we
identify an apparent material inconsistency or material misstatement, we are required to perform procedures
to conclude whether there is a material misstatement of the financial statements or a material misstatement
of the other information. If, based on the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report that fact. We have nothing to report based
on these responsibilities.
With respect to the Strategic report and Directors’ report, we also considered whether the disclosures required
by the UK Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report
certain opinions and matters as described below.
Strategic report and Directors’ report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic
report and Directors’ report for the year ended 31 December 2022 is consistent with the financial statements
and has been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the group and company and their environment obtained
in the course of the audit, we did not identify any material misstatements in the Strategic report and
Directors’ report.
Directors’ Remuneration
In our opinion, the part of the Remuneration Committee report to be audited has been properly prepared
in accordance with the Companies Act 2006.
Corporate governance statement
The Listing Rules require us to review the directors’ statements in relation to going concern, longer-term
viability and that part of the corporate governance statement relating to the company’s compliance with the
provisions of the UK Corporate Governance Code specified for our review. Our additional responsibilities with
respect to the corporate governance statement as other information are described in the Reporting on other
information section of this report.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of
the corporate governance statement is materially consistent with the financial statements and our knowledge
obtained during the audit, and we have nothing material to add or draw attention to in relation to:
• The directors’ confirmation that they have carried out a robust assessment of the emerging and principal risks;
• The disclosures in the Annual Report that describe those principal risks, what procedures are in place to
identify emerging risks and an explanation of how these are being managed or mitigated;
• The directors’ statement in the financial statements about whether they considered it appropriate to
adopt the going concern basis of accounting in preparing them, and their identification of any material
uncertainties to the group’s and company’s ability to continue to do so over a period of at least twelve
months from the date of approval of the financial statements;
• The directors’ explanation as to their assessment of the group’s and company’s prospects, the period this
assessment covers and why the period is appropriate; and
• The directors’ statement as to whether they have a reasonable expectation that the company will be able to
continue in operation and meet its liabilities as they fall due over the period of its assessment, including any
related disclosures drawing attention to any necessary qualifications or assumptions.
Our review of the directors’ statement regarding the longer-term viability of the group and company was
substantially less in scope than an audit and only consisted of making inquiries and considering the directors’
process supporting their statement; checking that the statement is in alignment with the relevant provisions
of the UK Corporate Governance Code; and considering whether the statement is consistent with the financial
statements and our knowledge and understanding of the group and company and their environment obtained
in the course of the audit.
In addition, based on the work undertaken as part of our audit, we have concluded that each of the following
elements of the corporate governance statement is materially consistent with the financial statements and
our knowledge obtained during the audit:
• The directors’ statement that they consider the Annual Report, taken as a whole, is fair, balanced and
understandable, and provides the information necessary for the members to assess the group’s and
company’s position, performance, business model and strategy;
• The section of the Annual Report that describes the review of effectiveness of risk management and
internal control systems; and
• The section of the Annual Report describing the work of the Audit Committee.
We have nothing to report in respect of our responsibility to report when the directors’ statement relating to
the company’s compliance with the Code does not properly disclose a departure from a relevant provision of
the Code specified under the Listing Rules for review by the auditors.
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Independent Auditors’ Report Continued
Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Statement of Directors’ responsibilities, the directors are responsible for the
preparation of the financial statements in accordance with the applicable framework and for being satisfied
that they give a true and fair view. The directors are also responsible for such internal control as they
determine is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the group’s and the
company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless the directors either intend to liquidate the group or
the company or to cease operations, or have no realistic alternative but to do so.
• Enquiry of group’s staff in tax and compliance functions to identify any instances of non-compliance with
laws and regulations;
• Obtaining and understanding the results of whistleblowing procedures and assessing any related investigations;
• Enquiry of the group’s Head of Internal Audit and reviewing internal audit reports; and
• Reviewing financial statement disclosures and testing to supporting documentation to assess compliance
with applicable laws and regulations.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of
instances of non-compliance with laws and regulations that are not closely related to events and transactions
reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is
higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by,
for example, forgery or intentional misrepresentations, or through collusion.
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these financial statements.
Our audit testing might include testing complete populations of certain transactions and balances, possibly
using data auditing techniques. However, it typically involves selecting a limited number of items for testing,
rather than testing complete populations. We will often seek to target particular items for testing based on
their size or risk characteristics. In other cases, we will use audit sampling to enable us to draw a conclusion
about the population from which the sample is selected.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s
website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the company’s members as a body
in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not,
in giving these opinions, accept or assume responsibility for any other purpose or to any other person to
whom this report is shown or into whose hands it may come save where expressly agreed by our prior
consent in writing.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of
irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities,
including fraud, is detailed below.
Based on our understanding of the group and industry, we identified that the principal risks of non-compliance
with laws and regulations related to fraud, anti-bribery and corruption laws, and we considered the extent to
which non-compliance might have a material effect on the financial statements. We also considered those laws
and regulations that have a direct impact on the financial statements such as the Companies Act 2006 and
relevant tax legislation. We evaluated management’s incentives and opportunities for fraudulent manipulation
of the financial statements (including the risk of override of controls), and determined that the principal risks
were related to fraudulent journal entries to manipulate the financial performance and management bias in
significant accounting estimates in order to achieve management incentive scheme targets. The group
engagement team shared this risk assessment with the component auditors so that they could include
appropriate audit procedures in response to such risks in their work. Audit procedures performed by the
group engagement team and/or component auditors included:
• Enquiry of management, those charged with governance and the group’s legal counsel around actual and
potential fraud and non-compliance with laws and regulations;
• Auditing the risk of management override of controls and the risk of fraud in revenue recognition, including
through testing journal entries and other adjustments for appropriateness, testing accounting estimates
(because of the risk of management bias), testing accrued income, and evaluating the business rationale
of significant transactions outside the normal course of business;
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Independent Auditors’ Report Continued
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
• we have not obtained all the information and explanations we require for our audit; or
• adequate accounting records have not been kept by the company, or returns adequate for our audit have
not been received from branches not visited by us; or
• certain disclosures of directors’ remuneration specified by law are not made; or
• the company financial statements and the part of the Remuneration Committee report to be audited are
not in agreement with the accounting records and returns.
We have no exceptions to report arising from this responsibility.
Appointment
Following the recommendation of the Audit Committee, we were appointed by the members on 25 May 2016
to audit the financial statements for the year ended 31 December 2016 and subsequent financial periods.
The period of total uninterrupted engagement is seven years, covering the years ended 31 December 2016
to 31 December 2022.
Other matter
In due course, as required by the Financial Conduct Authority Disclosure Guidance and Transparency Rule
4.1.14R, these financial statements will form part of the ESEF-prepared annual financial report filed on the
National Storage Mechanism of the Financial Conduct Authority in accordance with the ESEF Regulatory
Technical Standard (‘ESEF RTS’). This auditors’ report provides no assurance over whether the annual financial
report will be prepared using the single electronic format specified in the ESEF RTS.
Graham Parsons
(Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
27 February 2023
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Glossary – Alternative performance measures
Introduction
In the reporting of financial information, the Directors have adopted various Alternative Performance Measures
(‘APMs’). These measures are not defined by UK-adopted international accounting standards. As adjusted
results and measures include the benefits of certain Separately Disclosed Items (‘SDIs’) (as detailed in note 3),
but exclude significant costs related to those items, they should not be regarded as a complete picture of the
Group’s financial performance, which is presented on the face of the income statement under total results.
The exclusion of these items may result in adjusted operating profit being materially higher or lower than
total operating profit. In particular, where significant impairments, restructuring charges and legal costs are
excluded in any year, adjusted operating profit will be higher than total operating profit.
Purpose
The Directors believe that APMs assist the user of the Annual Report & Accounts in providing useful
information around trends, performance and the position of the Group between reporting periods and across
operating divisions by adjusting for non-recurring factors assessing the total results of the Group, as well
as aiding users in understanding the Group’s performance. APMs are commonly used by management for
performance review, budget setting and forecasting across the Group.
Some of the metrics shown for the Group are translated at constant exchange rates. Constant rates compares
both 2022 and 2021 figures at the average and year-end exchange rates for 2022, in order to remove the
impact of currency translation from the Group’s growth figures.
Changes to APMs
There have been no significant changes to the definitions of existing APMs or the APMs used by the Group in
the year.
Reconciliations
Reconciliations between statutory and adjusted measures can be found in the Financial review in Book one,
page 30.
APM
Closest equivalent statutory measure
Adjustments to reconcile adjusted to statutory
Definition and purpose
Like-for-like revenue (‘LFL’)
No direct equivalent
Acquisitions and business disposals
Adjusted free cash flow
Net cash flows from operating
activities
Includes cash flows from acquisition and sale of PPE, repayment of lease
liabilities and interest received.
Excludes the impact of cash flow SDIs.
Including acquisitions following their 12-month anniversary of ownership
and removing the historical contribution of any business disposals/closures.
Excluding acquisitions and disposals demonstrates the Group’s
performance for comparable operations year-on-year by removing any
inflation of revenue in the current year or prior year contributed from new
acquisitions or disposals.
Free cash flow includes net cash flows from operating activities and certain
cash flows from investing activities and the repayment of lease liabilities.
The following items are excluded: all other cash flows from financing
activities. This measure reflects the cash available to shareholders. This
is a key performance metric for the incentive scheme.
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Glossary – Alternative performance measures Continued
APM
Closest equivalent statutory measure
Adjustments to reconcile adjusted to statutory
Definition and purpose
Adjusted operating profit*
Statutory operating profit*
Separately disclosed items (see note 3) including amortisation of acquisition
intangibles; impairment of goodwill and other assets; the profit or loss on
disposals of businesses or other significant non-current assets; costs
of acquiring and integrating acquisitions; the cost of any fundamental
restructuring; material claims and settlements; significant recycling of
amounts from equity to the income statement; and unrealised market
or fair value gains or losses on financial assets or liabilities, including
contingent consideration.
Adjusted operating profit is a key measure of the Group’s performance and
is based on operating profit before the impact of SDIs. These items relate
to income or costs that are excluded from adjusted operating profit due to
their nature or size to provide readers with a clear and consistent view of
the business performance of the Group and its operating divisions on a
year-on-year basis.
Adjusted operating margin
Statutory operating margin
As per adjusted operating profit.
Adjusted diluted earnings per
share
Statutory diluted earnings per
share
SDIs after tax (see note 3) including amortisation of acquisition intangibles;
impairment of goodwill and other assets; the profit or loss on disposals of
businesses or other significant non-current assets; costs of acquiring and
integrating acquisitions; the cost of any fundamental restructuring; material
claims and settlements; significant recycling of amounts from equity to the
income statement; and unrealised market or fair value gains or losses on
financial assets or liabilities, including contingent consideration.
Adjusted operating profit divided by revenue, both before the impact of
SDIs. These items relate to income or costs that are excluded from adjusted
operating profit due to their nature or size to provide readers with a clear and
consistent view of the business performance of the Group and its operating
divisions on a year-on-year basis.
This metric relates to profit after tax before SDIs divided by the weighted
average number of ordinary shares in issue during the financial year
adjusted for the effects of potentially dilutive shares. This is a key
performance metric for the incentive scheme.
Adjusted cash flow from
operations
Cash flow from operations
Cash flows relating to separately disclosed items, as identified in the cash
flow statement.
This excludes the impact of the cash flows relating to SDIs to reflect the
cash flows available during recurring operations.
Adjusted net financing costs
Statutory net finance costs
Changes in fair value of contingent consideration.
Adjusted net financing costs exclude income or costs that, due to their
nature or size, provide the readers with a clear and consistent view of the
business performance of the Group on a year-on-year basis.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents 63
Glossary – Alternative performance measures Continued
APM
Closest equivalent statutory measure
Adjustments to reconcile adjusted to statutory
Definition and purpose
Adjusted profit after tax
Statutory profit after tax
As per adjusted profit and additionally any separately disclosed tax related
items are excluded.
ROIC (based on adjusted
profit)
No direct equivalent
Adjusted operating profit is the profit measure used in calculating ROIC.
Net financial debt
No direct equivalent
Total net debt less lease liabilities.
Adjusted EBITDA
Statutory EBITDA
Earnings before interest, tax, depreciation and amortisation and excluding
SDIs (see note 3) including amortisation of acquisition intangibles;
impairment of goodwill and other assets; the profit or loss on disposals of
businesses or other significant non-current assets; costs of acquiring and
integrating acquisitions; the cost of any fundamental restructuring; material
claims and settlements; significant recycling of amounts from equity to the
income statement; and unrealised market or fair value gains or losses on
financial assets or liabilities, including contingent consideration.
* Operating profit is presented on the Consolidated income statement. It is not defined per IFRS, however, is a generally accepted profit measure.
Adjusted profit after tax is based on profit after tax before the impact of
SDIs. These items relate to income or costs that are excluded from adjusted
operating profit due to their nature or size to provide readers with a clear
and consistent view of the business performance of the Group and its
operating divisions on a year-on-year basis.
Adjusted profit after tax (as defined above) divided by invested capital. This
is a key performance metric for the incentive scheme.
This measure shows the non-operational financial debt of the Group,
excluding lease liabilities.
This metric removes the impact of both SDIs and interest, tax, depreciation
and amortisation to provide a clear and consistent view of the business
performance of the Group year-on-year at a level before the impact of some
non-cash items and financing costs.
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents Shareholders and corporate information
Shareholders’ enquiries
Any shareholders with enquiries relating to their shareholding should, in the first instance, contact our
Registrar, EQ (Equiniti), using the telephone number or the address below.
Investor relations
E: investor@intertek.com
T: +44 (0) 20 7396 3400
64
Electronic shareholders communications
Instead of receiving paper copies, shareholders can elect to receive communications by email each
time the Company distributes documents. This can be done by registering for email communications at
www.shareview.co.uk. In the event that you change your mind or require a paper version of any document
in the future, please contact the Registrar.
Registrars
EQ
Highdown House, Yeoman Way, Worthing, West Sussex, BN99 3HH
T: +44 (0) 371 384 2653*
*
Lines are open 8.30 a.m. to 5.30 p.m. Monday to Friday, excluding bank holidays in England and Wales.
Please use the country code when calling from outside the UK.
Access to EQ Shareview allows shareholders to view details about their shareholdings, submit a proxy vote for
shareholders meetings and notify a change of address. In addition to this, shareholders can complete dividend
mandates online which facilitates the payment of dividends directly into a nominated bank account.
ShareGift
If you have a small shareholding which is uneconomical to sell, you may want to consider donating it to
ShareGift, a share donation charity. Details of the scheme are available from:
ShareGift at www.sharegift.org
T: +44 (0) 20 7930 3737
Share price information
Information on the Company’s share price is available at www.intertek.com.
Financial calendar
Financial year-end
Full-year results announced
Annual General Meeting and Trading Update
Ex-dividend date for final dividend
Record date for final dividend
Final dividend payable
Half-year results announced
Ex-dividend date for interim dividend
Record date for interim dividend
Interim dividend payable
Trading Update
31 December 2022
28 February 2023
24 May 2023
25 May 2023
26 May 2023
15 June 2023
28 July 2023
14 September 2023
15 September 2023
6 October 2023
23 November 2023
Independent Auditors
PricewaterhouseCoopers LLP
1 Embankment Place, London WC2N 6RH
T: +44 (0) 20 7583 5000
Brokers
J.P. Morgan Cazenove
25 Bank Street, Canary Wharf, London E14 5JP
T: +44 (0) 20 7742 4000
Goldman Sachs International
Plumtree Court, 25 Shoe Lane, London EC4A 4AU
T: +44 (0) 20 7774 1000
Credit Suisse International
One Cabot Square, London E14 4QJ
T: +44 (0) 20 7888 8888
Registered office
Intertek Group plc
33 Cavendish Square, London W1G 0PS
T: +44 (0) 20 7396 3400
www.intertek.com
Registered number: 04267576
ISIN: GB0031638363
LEI: 2138003GAT25WW1RN369
London Stock Exchange Industrials/Professional Business Support Services
FTSE 100
Symbol: ITRK
Intertek Group plc Annual Report & Accounts 2022Strategic ReportSustainability ReportFinancial ReportBook oneBook twoBook threeContents This report has been printed on material which is
certified by the Forest Stewardship Council®. The
paper is made at a mill with ISO 14001 Environmental
Management System accreditation. Printed using
vegetable oil based inks, the printer is also certified
to ISO 14001 Environmental management system
and FSC® certified.
Intertek Group plc
33 Cavendish Square,
London, W1G 0PS
United Kingdom
Tel +44 20 7396 3400
info@intertek.com
intertek.com