CRE ATING A B E T TER WAY TO LI V E
A N N UA L RE PO RT 2023
CONTENTS
PERFORMANCE SUMMARY
S T R AT E G I C R E P O R T
G OV E R N A N C E R E P O R T
F I N A N C I A L S TAT E M E N T S
S H A R E H O L D E R I N F O R M AT I O N
R E V E N U E
L E G A L C O M P LE T I O N S
1
Performance Summary
132 Corporate Governance
200 Independent Auditor’s
250 Five Year Summary
U N D E R LY I N G
E A R N I N G S P E R S H A R E *
Report
Report
134 Board of Directors
210 Consolidated Income
146 Audit Committee Report
156 Nomination Committee
Report
162 Placemaking and
Sustainability Committee
Report
Statement
210 Statement of
Comprehensive Income
211 Balance Sheets
212 Statement of Changes
in Equity
166 Directors’ Remuneration
213 Statement of Cash Flows
Report
192 Directors’ Report
214 Accounting Policies
220 Notes to the Financial
198 Statement of Directors’
Statements
Responsibilities
252 ESG Hub
270 Sustainability
Accounting Standards
Board (SASB) Disclosure
Table
279 Corporate and
Shareholder
Information
2 Chairman’s Statement
4 Our Investment Case
6 Our Strategy
12 Our Business Model
16 Group Chief
Executive's Statement
20 Operating Review
84 Financial Review
88 Risk Management
100 Going Concern and
Viability Statement
102 Task Force On Climate
Related Financial
Disclosures (TCFD)
114 Section 172(1) Statement
118 Stakeholder
Engagement
130 Group Non-Financial
and Sustainability
Information Statement
EN V I RO N M ENTA L , SOCI A L A N D G OV ER N A N C E
(“ ESG ”) H I G H LI G HTS
D E S C R I P T I O N O F O U R
B U S I N E S S M O D E L
B U I L D I N G
R E S P O N S I B LY
VA LU I N G
P E O P L E
G OV E R N A N C E
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£2,127m
-1%
5,436
-5%
91.2p
-5%
S TAT U TO RY E A R N I N G S
P E R S H A R E
U N D E R LY I N G
P R O F I T B E F O R E TA X *
S TAT U TO RY P R O F I T
B E F O R E TA X
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6 Our Strategy
44 Energy Smart Homes
68 Closing the Construction
39 Charitable and Political
1 9
2 0
2 1
2 2
2 3
1 9
2 0
2 1
2 2
2 3
1 9
2 0
2 1
2 2
2 3
Skill Gap
72 & 194
Equality Diversity and
Inclusion
74 Women in Construction
Donations
49 Data Privacy
67, 82 & 131
Human Rights and
Modern Slavery
91.2p
+58%
£395m
-4%
£395m
+61%
76 Engaging People and
131 Whistleblowing
O R D E R B O O K *
F U L L Y E A R D I V I D E N D
P E R S H A R E *
12 Our Business Model
46 Customers First
22 Benchmarks and Indices
50 Climate Change
24 Material Issues
56 Route Map to Net-Zero
Carbon
58 Resource Efficiency
62 Safe by Design and
Operating Responsibly
22 UN SDGs
38 & 118
Stakeholder
Engagement
252 ESG Scorecard
266 Operational Framework
T H R I V I N G
C O M M U N I T I E S
28 Placemaking in Practice
30 Better Place to Live
34 Nature for People
38 Positive Social Impact
Cover image:
The Orchards, Droitwich, Worcestershire.
Partners
78 Pride in the Job Award
Winners
82 Supplier Partnerships
82 Volunteering
139 Conflicts of Interest
154 Anti-bribery and
Corruption
155 Code of Conduct
The Group Non-Financial
Information Statement on pages 130 to
131 provides further information and
sign posting.
Find more information at:
redrowplc.co.uk
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£851m
-41%
30.0p
-6%
*
*
Redrow uses a variety of statutory
performance measures and alternative
performance measures when reviewing
the performance of the Group. See note
23 for an explanation and reconciliation
of these alternative performance
measures.
Underlying is defined as any statutory
or alternative performance measure
pre-exceptional items. See note 2 and
note 23.
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Redrow plc Annual Report 2023Strategic report
Chairman's statement
CHAIRMAN'S STATEMENT
The Board have worked hard to
deal with the emerging risks, and
regulatory and policy uncertainty,
to ensure that our strategy remains
fit for purpose in this environment.
P E O P L E
I am very pleased that Geeta Nanda
joined the Board as an independent
non-executive director on 1 May 2023.
Geeta has spent almost the entirety of
her career in housing associations and
is currently Chief Executive of
Metropolitan Thames Valley Housing
Association. She will add valuable
additional experience of the housing
sector to the Redrow Board. Nick
Hewson retired at the AGM in
November 2022 after nearly ten years
of service, and we thank him for the
valuable contribution he has made
over that time. His roles of Senior
Independent Director and Audit Chair
have been taken up by Nicky Dulieu
and Oliver Tant respectively.
The excellent long-term performance
of the business is due to the ongoing
commitment and hard work of
everyone at Redrow, together with our
subcontractors and suppliers, and I
would like to thank them all for their
efforts in these uncertain times.
T R A D I N G A N D O U T LO O K
Following the macroeconomic volatility
of the last financial year, as we go into
2024 the market remains challenging
and uncertain. However, we believe
we are well positioned to respond to
the market as it develops. We have the
land, people, designs and quality to
deliver the homes and communities
our customers want.
Richard Akers
Non-Executive Chairman
15 September 2023
Richard Akers
Non-Executive Chairman
Open plan Kitchen, dining, family room in the Hampstead
show home at Bishop Meadows, Oldham, Lancashire.
The last financial year proved to be
one of considerable uncertainty for
the housing sector. The market almost
came to a standstill in the second
quarter of our financial year due to the
steep rise in mortgage rates as a
result of political uncertainty. Whilst
the market did partially recover in
spring 2023, the further rise in
mortgage rates combined with the
cost of living crisis means the market
remained subdued. The Board have
worked hard to deal with the emerging
risks, and regulatory and policy
uncertainty, to ensure that our strategy
remains fit for purpose in this
environment.
F I N A N C I A L R E S U LT S
We completed 5,436 homes in the
year. Whilst this was a 5% reduction on
the 2022 financial year (2022: 5,715),
revenue was stable due to the
increase in average selling price that
was already embedded in the order
book. This reflects the demand for our
Heritage range of family homes in
primary locations and our focus on
placemaking and enabling thriving
communities to develop.
Profit before tax was £395m, which
was 4% below the underlying profit for
2022, primarily due to cost inflation
exceeding house price inflation in the
year.
S H A R E H O LD E R R E T U R N S
Our underlying earnings per share of
91.2p were 5% below the previous
financial year (2022: 96.0p). In
addition to the lower profit before tax
this reduction is also due to higher
Corporation Tax and Residential
Property Development Tax effective
rates totalling 24.5% versus 20% last
year.
Our underlying Return on Capital
Employed was 23.1% (2022: 24.5%) and
underlying Return on Equity was 19.9%
(2022: 21.5%). We ended the year with
net cash excluding lease liabilities of
£235m (2022: £288m). The average
monthly net cash balance was £196m,
only £54m below the prior year,
despite the £100m share buyback
completed in January 2023.
As a result of this strong financial
performance and in line with the
company’s policy of three times
dividend cover, the Board is proposing
a final dividend of 20.0p making a total
of 30.0p for the year (2022: 32.0p).
Subject to shareholder approval at the
Annual General Meeting on 10
November 2023, this will be paid on 16
November 2023 to all shareholders on
the register at 22 September 2023.
P U R P O S E A N D S T R AT E GY
Our purpose of Creating a Better Place
to Live is deeply embedded within the
company. The Pillars on which this is
built of Thriving Communities, Building
Responsibly and Valuing People are
the basis of our sustainability agenda.
We have made great progress in
developing our metrics and
commitment to sustainability in the
knowledge that it is built on creating
developments which will stand the test
of time.
The Group has completed its
withdrawal from the London market,
other than the ongoing Colindale
development. Outside London our
product is primarily our Heritage
Range which has proven to be resilient
and popular through the changing
market conditions. Despite this, the
company found it necessary to
undertake a restructuring in July,
including the closure of two offices.
F I R E S A F E T Y
We have continued to make progress
in the area of legacy fire safety. We
signed the UK Government’s Self
Remediation Contract and the Welsh
Government’s Pledge in the year
concerning the remediation of life
critical fire safety in buildings over 11m
that we developed in the last 30 years.
Remediation works are either
progressing or being planned for all
the buildings concerned.
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Our investment case
OUR INVESTMENT CASE
S U C C E S S F U L LE A D E R S H I P T E A M
E X P E R T I S E I N L A N D B U Y I N G
B U I L D I N G R E S P O N S I B LY
Redrow has a strong, experienced and successful
leadership team and remains committed to
succession planning and developing the next
generation of homebuilders.
We have the expertise and resources to ensure that
the right land opportunities are secured in
geographic locations, aligned to our strategy, at the
right time in the house building industry cycle.
We are committed to registering all our
developments with the Considerate Constructors
Scheme (CCS).
C LI M AT E C H A N G E – R O U T E TO N E T Z E R O
Our near-term net carbon targets have been
validated by the Science Based Targets Initiative.
15.9%
of workforce on
structured training
programmes *
235
internal promotions
in year
26,070
39.5
48%
current land holdings with planning permission
out of 45 CCS Score (above 33 target)
reduction in scope 1 and 2 emissions since 2021
P L AC E M A K I N G
D I F F E R E N T I AT E D P R O D U C T
Q UA LI T Y A N D C U S TO M E R S E R V I C E
A S T R O N G A N D R E S I L I E N T B A L A N C E S H E E T
We focus on delivering high quality homes and
creating attractive, sustainable and vibrant places
to live with wellbeing at their heart.
Redrow focuses on the home mover segment and
we evolve our designs to ensure we offer customers
some of the most desirable and energy efficient
homes on the market.
We have implemented the New Homes Quality
Code and we continue to evolve our product and
customer service. We focus on quality,
differentiation and value for money for customers.
Redrow has net assets of £2.0bn. The Group
focuses medium term on delivering superior levels
of return on equity and return on capital employed
from an efficient use of its capital base.
£305m
committed to fund
improvements to local
communities *
1,488
affordable homes
delivered to our
communities
£1.3bn
90%
revenue value of private
reservations secured in
the year *
Heritage Collection
revenue as a percentage
of private revenue
90.8%
HBF 8 week customer
recommendation survey
– HBF 5 star status
Based on over 6,796 reviews
19.9%
return on equity *
30.0p
dividend to
shareholders
4
* See note 23
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Strategic report
Our strategy
OPERATIONAL
FRAMEWORK
O U R ‘ B E T TE R ’ PU R P OS E
R E D ROW S TR ATE GY
We are driven to create a better way to live,
in turn generating financial and non-financial
value for our stakeholders. Fundamental to
this is delivering better: better than standard,
better than our competition and better than
we have done before.
Our strategy is based on creating thriving
communities by building responsibly and
valuing people. By balancing these three
areas, we create long-term sustainable
value. We also mitigate environmental, social
and governance (ESG) risks, enhancing our
resilience to market and societal trends.
Creating
a better way to live
NATURE FOR PEOPLE
B ET TER
PL ACES TO LIVE
POSITIVE SOCIAL
I M PACT
SAFE BY DESIG N AN D
OPER ATING RESPONSIB LY
PUT TING OUR
CUSTOM ERS FIRST
CLIMATE CHANG E AN D
RESOURCE EFFICIENCY
FUTURE SKI LL S
ENGAG ING OUR
PEOPLE AN D PARTN ERS
DIVERSIT Y, EQUALIT Y
AN D INCLUSION
R I S K M A N AG E M E NT
A N D E TH I C A L CO N D U C T
D E LI V E R I N G
F I N A N C I A L VA LU E
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Our strategy
OUR STRATEGY AND
HOW WE MEASURE IT
To create long-term sustainable value for
all our stakeholders by developing thriving
communities with high quality homes that
provide a better way to live.
CLIMATE CHANGE
AND RESOURCE
E FFICIENCY
8
M E A S U R E
2 02 4
G U I DA N C E †
EPS *
DPS *
41p
14p
K E Y P E R F O R M A N C E
I N D I C ATO R S
2 02 3
2 02 2
91.2p
96.0p†
30.0p
32.0p
We develop thriving communities with the
objective of creating healthy, nature rich
places with a sense of community. There are
three strands which support this work:
• Nature for People – putting nature, people
Revenue *
£1.65bn – £1.7bn
£2,127m
£2,140m
and wellbeing at the heart of our
developments;
• Better Places to Live – creating beautiful,
sustainable and inclusive places for
wellbeing; and
• Positive Social Impact – creating positive
outcomes and making a difference to the
communities within which we develop.
Average sales
outlets *
117
117
111
Monies
committed to
fund
improvements
to local
communities *
Continued
investment in
local communities
Required
affordable homes
delivered
£305m
£281m
1,488
1,250
ROCE *
>10%
23.11%
24.54%†
Ensuring our sites are safe places to work
and visit is central to our build operations.
As we continue to help deliver much-needed
new homes, we are also striving to constantly
improve our quality and customer service,
whilst working to protect the environment.
The themes which support this activity are:
• Safe by Design and Operating Responsibly
– integrating health, safety and environment
into everything we do;
• Putting Our Customers First – consistently
delivering high quality, efficient homes for
our customers; and
• Climate Change and Resource Efficiency
– transition to a low carbon and more
efficient business and deliver zero-carbon
ready homes.
Land holding
years *
Maintain land
holdings at c5
years
4.8 years
5.2 years
Waste diverted
from landfill *
>95%
98.3%
98.3%
HBF 8 week
customer
recommend
rating *
>94%
90.8%
94.5%†
Private
reservation rate *
0.45
0.46
0.68
Our objective is to inspire future industry
talent and create an inclusive diverse culture
for people and partners. The three strands
which support this work are:
• Future Skills – inspiring the next generation
into the sector and ensuring our people
have the opportunity to develop and grow
with the business;
• Engaging Our People and Partners –
empowering and engaging our people and
partners to deliver on our purpose; and
• Diversity, Equality and Inclusion – creating
a diverse and inclusive workplace that
prioritises the wellbeing of our people.
* see note 23 † underlying
Number of
trainees *
Maintain level of
trainees at 15% of
workforce
15.9%
15.0%
Overall
engagement
score
Maintain at 80%
84%
83%
Annual Injury
Incidence Rate *
Continuous
improvement
through a 10%
year on year
reduction
365
365
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Strategic report
Strategy spotlight
STRATEGY SPOTLIGHT
CREATING
SUSTAINABLE VALUE
Against the headwinds of socio-economic instability, our core
product of quality family homes in well-designed communities has
delivered. Combined with our social purpose, we achieved solid
financial returns, while continuing to create wider social value.
U N I Q U E S E LLI N G
P O I NT
D E C A R BO N I S I N G
H O M E S
A DY N A M I C
M AC RO E CO N O M I C
E N V I RO N M E NT
Macroeconomic and political volatility
before Christmas 2022 reduced the
demand for housing. When coupled
with existing inflating supply chain
costs, labour shortages and the
evolving complex regulatory
landscape on carbon emissions,
building standards, planning and
quality and safety– the housebuilding
sector has faced a ‘perfect storm’ of
pressures. The robust financial and
non-financial performance we
achieved is therefore more indicative
than ever that our business model and
strategy are fit-for-purpose and that
our core product is meeting market
demand.
S E E F I N A N C I A L S TAT E M E N T S O N
PAG E S 2 1 0 – 2 4 9
10
N ATU R A L S PAC E S
SOC I O - E CO N O M I C
VA LU E
Well prepared for Biodiversity Net
Gain regulation, all planning
applications submitted after
November 2023 will aim to increase
biodiversity by more than 10%.
Already many of our developments
are planned around the inclusion of
better green spaces like meadows,
orchards, ponds and woodlands for
communities to enjoy.
D I S C OV E R M O R E A B O U T O U R
T H R I V I N G C O M M U N I T I E S O N
PAG E S 3 4 – 3 7
We invested £258m in affordable
housing, as well as a further £47m in
community infrastructure, such as
schools, shops, green spaces and
community or health centres. A total of
349 roles were created for trainees,
apprentices or graduates. Finally, we
created opportunities through our
supply chain, over 4,000
subcontractors and suppliers, while
contributing £170m in taxes.
D I S C OV E R M O R E A B O U T O U R
T H R I V I N G C O M M U N I T I E S O N
PAG E S 3 8 – 41
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Quality, well-designed homes in
master-planned neighbourhoods are
what customers continue rating us
highly for (achieving Excellent once
again in Trustpilot and five stars from
the HBF). When we add in access to
nature, energy-smart, flexible living
and cutting-edge customer service,
it’s clear we’re pivoted to embrace
emerging trends.
Escalating utility costs have made
energy efficient homes a key priority
for customers. We’re proud to be
trailblazing air source heat pumps and
underfloor heating (in ground floor
rooms) as standard – a first for our
industry. This is just one aspect of how
we plan to achieve net zero emissions
across our homes, operations and
supply chain by no later than 2050.
D I S C OV E R M O R E A B O U T O U R
C U S TO M E R E X P E R I E N C E O N
PAG E S 4 6 – 4 9
D I S C OV E R M O R E A B O U T O U R
E N E R GY- S M A R T H O M E S O N
PAG E S 4 4 – 4 5
C LOS I N G
S K I LL S GA P S
We’ve responded rapidly and robustly
to construction skills shortages by
investing in more apprenticeships,
sponsored degrees, graduate
programmes and school partnerships.
Our focus is on young people from
disadvantaged backgrounds and
attracting more women into our
industry.
D I S C OV E R M O R E A B O U T
O U R P E O P L E O N PAG E S 6 8 – 7 1
Sustainability is fundamental to our
purpose, our business model, our
culture, and strategy.
I’m pleased with the progress
we’ve made across our operational
KPI’s and environmental, social and
governance metrics.
Matthew Pratt
Group Chief Executive
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Our business model
OUR BUSINESS MODEL
Overview
R E SO U RC E S
W H AT W E D O A N D
H OW W E D O IT
Q UA L I T Y L A N D H O L D I N G S
• Land, Planning and Design
The quality and location of our land
holdings is a vital component to enable us
to deliver sustainable developments and
returns.
O U R D I V E R S E A N D
TA L E N T E D P E O P L E
Our employees are at the heart of our
business and our results are achieved
through their talent, hard work and
dedication, working in an inclusive working
environment.
O U R P L AC E M A K I N G S K I L L S
We harness our placemaking skills to
deliver positive outcomes for both the
developments we create and existing local
communities.
O U R F I N A N C I A L R E S O U R C E S
Appropriate financial resources are a key
enabler to support the delivery of our
strategy which is regularly and clearly
communicated to our investors and
relationship banks.
• Commercial
• Construction
• Sales & Marketing and Customer Service
• Systems and Business Support
R E A D M O R E O N PAG E S 1 4 – 1 5
O U R S T R AT E GY
R E A D M O R E O N PAG E S 6 – 1 1
VA LU E D R I V E R S
• Dedicated leadership and diverse expertise
• Prioritising nature and wellbeing in placemaking
• Integrating health, safety and environment into
everything we do
• Quality and customer service
• Net zero carbon strategy
• Inspiring the next generation into the sector
• Empowering and engaging our people and
partners to deliver on our purpose
O UTPUTS
C U S TO M E R S
Our customers are fundamental to our business and
we take great care to research their needs, listen to
their feedback and evolve our carefully designed new
homes as lifestyles and aspirations change.
D E LI V E R I N G VA LU E FO R
S TA K E H O LD E R S
C U S TO M E R S
HBF 9 month post
occupancy Customer
Recommend rating
81.1%
C O M M U N I T I E S
We adopt a collaborative approach, engaging with
community stakeholders to ensure our developments
become thriving communities, delivering better places
to live.
C O M M U N I T I E S
Monies committed to fund
improvements to local
communities
£305m
S U P P L I E R S & S U B C O N T R AC TO R S
S U P P L I E R S & S U B C O N T R AC TO R S
We work closely with our experienced suppliers and
subcontractors to maintain a strong and reliable supply
chain delivering quality products and workmanship.
Average number of
supplier and subcontractor
partners in 2023
c4,200
O U R P E O P L E
Our employees are fundamental to our business; we
invest in attracting and retaining talented people with
a key focus on training and development to enable
our people to build rewarding careers and deliver
succession planning for the future.
O U R P E O P L E
People directly
employed on average
in 2023
2,270
S H A R E H O L D E R S
Our Shareholders are the primary providers of financial
resources enabling us to create long-term sustainable
value. We aim to provide a balance between capital
growth and cash returns to our shareholders.
S H A R E H O L D E R S
Share buyback and
interim dividend paid to
shareholders in 2023
£133m
R E A D M O R E O N PAG E S 1 – 8 7
R E A D M O R E O N PAG E S 1 – 8 7
R E A D M O R E O N PAG E S 1 – 8 7
R E A D M O R E O N PAG E S 1 – 8 7
A N D PAG E S 1 1 8 – 1 2 9
C O N T R O L E N V I R O N M E N T
R I S K M A N AG E M E N T
C O R P O R AT E G OV E R N A N C E
K E Y P E R F O R M A N C E I N D I C ATO R S
R E A D M O R E O N PAG E S 8 8 – 9 9
R E A D M O R E O N PAG E S 1 3 2 – 1 9 9
R E A D M O R E O N PAG E S 8 – 9
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Our business model / continued
OUR BUSINESS MODEL
What We Do And How We Do It
L A N D PL A N N I N G
A N D D E S I G N
We have experienced land, planning
and design teams based in our
divisions who have a good knowledge
of their localities and the requirements
and concerns of local communities in
respect of housing development. They
are complemented by central Group
expertise including our Harrow Estates
strategic land division and Group
Masterplanning team.
Our teams work closely with land
owners, local authorities, Registered
Providers and adopt a collaborative
approach to engaging with local
community stakeholders.
The quality and location of our land
holdings is of vital importance to
delivering long term sustainable value
for the business. We focus on
investment in and promotion of
strategic land opportunities together
with shorter term opportunities
receptive to the value we can add
through our master planning,
placemaking and technical expertise.
The strength of our land holdings and
investment criteria controls enables
us to vary the level of our investment
in new land opportunities dependant
on our assessment of the land market
and housebuilding industry cycle.
Our Redrow 8 placemaking principles
provide a framework for us to create
sustainable developments of
thoughtfully designed homes that will
leave a legacy of attractive and
vibrant places to live for generations
to come.
CO M M E RC I A L
CO N S TRU C TI O N
The business has both division based
and Group based Commercial and
procurement teams to work closely
with our local and national suppliers
and subcontractors to maintain a
strong and reliable supply chain
delivering on quality of product and
workmanship at acceptable cost
levels.
The Commercial team are integral to
the land buying process, the design
process and the construction process
as well as playing a key role in
supporting colleagues and suppliers
as we implement our net zero carbon
strategy.
The Mulberries,
Witham, Essex.
Our building responsibly strategy
focuses on safety in the design,
construction and use of our homes.
By building safely, responsibly and
considerately we continue to deliver
much needed homes.
Build quality is a key focus together
with managing our resources
effectively to create homes of
enduring quality whilst minimising our
environmental impacts. The Group
Construction Director and the Group
Health, Safety and Environment
Director and their teams promote and
support continuous improvement on
health and safety and the environment
and build quality.
Our national apprenticeship
programme helps attract and support
the next generation into the
housebuilding sector.
SA LE S & M A R K E TI N G
A N D CUS TO M E R
S E RV I C E
We aim to provide our customers with
the best possible experience, every
time they interact with us, whether
they visit one of our Customer
Experience Suites in person or our
My Redrow online portal. We have
dedicated sales consultants and
customer service teams to support
our customers through their home
buying experience with dedicated
homeowner support.
Divisional teams are supported by
Group teams led by the Group Sales
Director, Group Quality and Customer
Director, Head of Marketing Services
and Head of Communications
reporting to the Group Customer and
Marketing Director.
SYS TE M S A N D
B US I N E S S S U PP O RT
Robust Groupwide systems underpin
everything we do, supporting
operations, enhancing control and
consistency and providing timely
management information to aid
decision making.
We have a dedicated team of
in-house IT specialists who work
closely with other Group specialist
business support departments and
the divisional teams to continue to
improve and evolve our systems and
IT security with major development
projects sponsored by members of
the Executive Management team.
Group specialist business support
departments such as the Group
Communities Director and our
Sustainability team, the Group Legal
team and the Group Human
Resources team evolve strategy and
provide advice to the divisions. All
this is underpinned by bespoke and
dedicated learning and development
programmes for colleagues.
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Group Chief Executive's statement
GROUP CHIEF EXECUTIVE'S
STATEMENT
The Group has delivered another
strong set of results. During the
year, we have taken several
important strategic decisions to
maximise sustainable value for
our stakeholders.
Matthew Pratt
Group Chief Executive
Despite continuing political and
economic headwinds, I’m pleased to
report that the Group has delivered
another strong set of results. During
the year under review, we have taken
several important strategic decisions
to maximise sustainable value for our
stakeholders, while delivering 5,436
completions (2022: 5,715).
Our Heritage Collection remains at the
centre of our strategy, differentiating
us from both new-build competitors
and the much larger second-hand
market. We continue to offer a unique
proposition to homebuyers: the
character of older homes combined
with quality, energy efficiency and
modern open plan interiors. These
selling points appeal to those moving
to larger homes as well as those who
are downsizing. Once again, we saw
the evidence of this with cash buyers
representing 35.7% (2022: 33%) of all
private reservations.
In January 2023, we became the first
large housebuilder to announce that
we would be installing air source heat
pumps into all our homes on upcoming
developments. Having listened to
customers, we saw the opportunity to
give our homes a significant further
advantage over others on the market.
Combining the heat pump with
underfloor heating as standard across
the ground floor of all our detached
homes further enhanced the
desirability and lifestyle benefits of
our houses for customers.
Cost of living and mortgage
affordability continue to have a
negative impact on the market. Where
appropriate, we’ve used targeted sales
incentives to convert buyer interest
into reservations. Following several
consecutive Bank of England base rate
increases, we remain hopeful that, as
inflation eases, we will see some
stability in mortgage rates. The
reduction in mortgage volatility will
enable potential customers to
progress the purchase of their home
with financial certainty. Reflecting the
macro-economic picture and the
tougher sales market, our average
private reservation rate per week for
the year was 0.46 compared to 0.68 in
2022 (excluding bulk deals 0.45 and
0.66).
Given housebuilders’ strong forward
order books during the financial year
under review, both materials and
sub-contract labour were stretched,
with build cost inflation of up to 8% in
some instances. These pressures have
since eased as the macro-economic
picture has become more uncertain,
with build cost inflation beginning to
return to more sensible levels. Going
forward, in the new financial year, we
expect build cost inflation to be circa
4%.
We ended the financial year with a
total order book of £0.85bn (2022:
£1.44bn) of which 65% (2022: 76%) was
exchanged. We are continuing to be
very selective on land buying and
focused on bringing forward strategic
land. This was demonstrated by the
purchase of only 1,906 plots of current
land. This is against the backdrop of
our substantial land investment in 2021
when we added over £3bn of Gross
Development Value (GDV) to our land
holdings with planning at good
margins. This activity secured the
medium-term land bank.
As a result of our land investment in
2021 we increased the number of
average outlets over the financial year
to 117 and we expect to maintain this
position during the 2024 financial year.
We remain in a strong positive cash
position, ending the financial year with
£235m net cash excluding lease
liabilities (2022: £288m). This is
despite the fact we have returned
£100m to shareholders in the form of a
share buyback programme during the
period from July 2022 to January
2023.
Sustainability is fundamental to our
purpose, our business model, our
culture, and strategy. We’ve made
good progress across our operational
KPI’s and environmental, social and
governance (ESG) metrics. We also
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Sycamore Manor, Chorley, Lancashire.
exceeded industry averages for
sustainability in the FTSE4Good Index
and sustained high customer
satisfaction ratings from the National
House Building Council (NHBC)
surveys and Trustpilot.
In order to embed this integrated
approach throughout our business,
we’ve refreshed our operational
framework which is built around our
long-standing sustainable business
pillars: Building Responsibly, Thriving
Communities and Valuing People. This
strengthens Redrow’s resilience in the
face of evolving ESG risks, including
regulation and industry standards,
such as the Future Homes Standard,
National Model Design Code and the
New Homes Quality Board Code of
Practice, as well as upcoming
Biodiversity Net Gain legislation and
the Nutrient Mitigation Scheme. It also
leaves us well placed to take
competitive advantage of sustainable
opportunities, such as delivering
energy and water-efficient homes for
customers. Across the framework, we
highlight how these activities
contribute to the UN Sustainable
Development Goals (SDG’s).
Thriving Communities is about more
than building homes. We apply our
audited Redrow 8 placemaking
principals to all our developments to
ensure we deliver beautiful, nature
rich, sustainable places for
communities to enjoy. We bring
extensive and lasting socio-economic
value for local communities by
investing in infrastructure like schools,
health centres, shops, parks and green
spaces, as well as affordable homes.
These Redrow 8 placemaking
principles and our Nature for People
commitments ensure that our
developments stand the test of time.
Our research shows they’re at the
heart of community cohesion many
years down the line.
Building Responsibly affirms our
commitment to upholding the highest
standards of health, safety and
environmental responsibility. I’m
pleased to report positive progress
against targets in this area. Our 2030
net zero carbon targets have been
validated by the Science-Based
Targets Initiative and we’re also
establishing a science-based route
map to 2050 that covers the entire
value chain, where the majority of our
emissions arise. Quality remains one
of the top material issues for our
stakeholders and we’ve earned our
reputation for consistently delivering
homes to a superior standard, as
evidenced in ‘Excellent’ Trustpilot
ratings and five-star HBF ratings for
five years’ running.
We invested further in people and
systems to uphold quality and service
standards, ensuring we rapidly
rectified and learned from any defect
reports. Our investments in
apprenticeships, work placements,
graduate programmes and university
and schools’ partnerships have been
more important than ever, along with
prioritising the work/life balance,
professional growth, and physical and
mental wellbeing of our colleagues.
Operating in an environment where
there is a complete absence of any
coherent housing policy from central
government, is very challenging for all
parts of the sector. The housing
market invests for the long-term, yet
the government is not providing the
framework for this level of financial
commitment. There is a fundamental
disparity between the country’s
population growth and the number of
homes built.
We continue to call for a long-term
plan that enables the industry to invest
and build the homes the country so
desperately needs. The introduction of
a national, independent body that
could identify housing need and
accelerate development in those areas
would be a significant positive step. It
would also generate a positive direct
and indirect economic benefit across
areas such as education, health, and
infrastructure.
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Strategic reportStrategic report
Group Chief Executive's statement / continued
Dining room in the Blenheim show
home at The Nook, Derby.
In the first ten weeks of trading for the
current financial year the reservation
per outlet per week was 0.34 (2023:
0.61).
Despite these difficult market
conditions our strategy remains the
right one, and this was clearly
demonstrated during the financial year
under review. Our Heritage Collection
serves different parts of the market:
from downsizers who want character
with energy efficiency, to aspirational
home movers who desire quality and
space.
I’d like to close by placing on record
my thanks to all Redrow colleagues
and our partners in the wider supply
chain for their hard work and
dedication this past year. We have
once again provided high quality
homes and places for thousands of
families across the country. We look
forward to carrying on this proud track
record as we head into our 50th
anniversary year in 2024.
Matthew Pratt
Group Chief Executive
15 September 2023
We have made positive progress in
tackling issues of legacy fire safety.
We signed the UK Government’s Self
Remediation Contract Long Form
Agreement (LFA) and the Welsh
Government's Pledge Deed of Bilateral
Contract regarding the remediation of
life critical fire safety issues in
buildings over 11m that we developed
in the past 30 years. And we believe
we were the first large house builder
to sign the Government’s Responsible
Actors Scheme.
We are actively progressing 46 of the
51 buildings with known or likely
external works. All 18m plus buildings
are in progress, which aligns with the
Government’s prioritisation advice. We
are on-site at 18 of these buildings,
with 14 at pre-contract stage.
The industry now has an additional
requirement to consider the internal
common parts. We are in the process
of assessing the 109 buildings
expected to require works, however
we don’t expect this to result in a
change to our overall provision.
O U T LO O K
The impact of a record number of
consecutive interest rate increases in
a short space of time and the general
rise in the cost of living, continues to
make this a challenging housing
market.
As a result of this operating
environment, we took the difficult
decision in July 2023 to reshape the
business, closing two of our smaller
divisional offices: Thames Valley and
Southern. Our outlets were unaffected
by this change, and they are now
managed by other local divisions. We
also reduced a number of roles across
our wider teams to reflect market
conditions. We have worked closely
with affected colleagues to support
them throughout this time.
There are signs of economic stability,
particularly with mortgage rates,
following a sharp and painful period of
adjustment for the country.
The strong fundamentals underpinning
the new homes market remain the
same. There is a chronic shortage of
new homes to keep pace with the
country’s current and future needs.
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Operating review
20
The strong financial performance of the
business enabled us to return cash of over
£200m to shareholders in the year whilst
maintaining a robust balance sheet.
Barbara Richmond
Group Finance Director
In a year of political and socio-economic
uncertainty, we’re confident that the
updates we’ve made to our operational
framework provide a bedrock to Redrow’s
resilience and agility as a business. We
remain sharply focused on managing risk
and finding opportunity in a tough market,
whilst maintaining our track record of long-
term, sustainable value creation for all our
stakeholders. We continue to build upon our
purpose-driven strategy.
Rose Sandell
Group Communities Director and Executive Management Team member
responsible for the Group’s sustainability strategy
The three pillars of our framework – Thriving Communities,
Building Responsibly and Valuing People – focus us on
the activities that will achieve our purpose and create
long-term sustainable value for our investors, colleagues,
partners, customers and communities.
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28 Placemaking in Practice
30 Better Places to Live
34 Nature for People
38 Positive Social Impact
44 Trailblazing Energy-Smart Homes
46 Customers First
50 Climate Change
58 Resource Efficiency
62 Safe By Design and Operating
Responsibly
68 Closing the Construction Skills Gap
72 Equality, Diversity and Inclusion
76 Engaging People and Partners
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Strategic reportStrategic reportOperating review
The sustainability agenda continues to evolve at
pace, with the ESG landscape becoming ever-more
complex. However, with social value at the heart
of our corporate purpose, we’re well positioned to
drive future financial and non-financial value for our
stakeholders.
Garry Cornell
Sustainability Director
OPERATIONAL FRAMEWORK
The Redrow operational framework is a
pragmatic plan to deliver on our purpose and
strategy. With robust targets and performance
measures, it supports how we create long-term
value for all stakeholders, while managing risk
and seeking opportunity for the business.
assured annually using recognised
reporting assurance protocols,
including the Global Reporting
Initiative (GRI) Principles for Report
Quality. The full Assurance Statement
can be found on our corporate
website: investors.redrowplc.co.uk/
key-non-financials.
See our disclosures:
• SASB – see page 270
• CDP Climate and CDP Forests,
available at cdp.net/en/responses
• TCFD – see page 102
• The Science Based Targets initiative
(SBTi) verification of our near-term
net zero targets and the process of
finalising our long-term net zero
carbon target – see page 50
F O R O U R E S G S C O R E C A R D,
O P E R AT I O N A L F R A M E W O R K A N D
R E P O R T I N G F R A M E W O R K S S E E
F R O M PAG E 2 5 2
R E A D M O R E A B O U T R I S K
M A N AG E M E N T O N PAG E S 8 8
TO 9 9
We’ve updated and published the
framework to reflect our latest
materiality assessment (see page 24),
stakeholder engagement (see page
118) and analysis of marketplace and
ESG risks and opportunities. The
refresh also considered Redrow 2025
commitments to accelerate innovation
across the business. We continue to
map framework programmes to the
United Nations Sustainable
Development Goals (SDGs).
E SG PE R FO R M A N C E
As shown in our published ESG
scorecard, each year we seek to
enhance the transparency and scope
of our ESG approach and performance
(see page 252). We are informed by
best international practices, including
those established by the Sustainability
Accounting Standards Board (SASB)
and the Task Force on Climate-related
Financial Disclosures (TCFD). We will
be aligning with new standards
established by the International
Sustainability Standards Board (ISSB)
as they’re introduced. Rating agencies
further challenge us to benchmark and
continuously improve ESG disclosure
and management and we monitor
these carefully.
The scorecard, which aligns to our
operational framework and includes
the KPIs for our material issues, is
A CONSTITUENT OF THE
FTSE4GOOD INDEX SERIES FOR
THE THIRD YEAR RUNNING2
ESG SCORE 3.3/5
MCSI ESG RATING
AA
ISS ESG RATING ABOVE INDUSTRY
AVERAGE, VERY HIGH TRANSPARENCY
RATING (MAY 2023)
CORPORATE RATING C1
6TH PLACE IN THE NEXT
GENERATION MOST SUSTAINABLE
UK HOMEBUILDER AWARDS
BRONZE AWARD
3
ESG RISK RATING, SUSTAINALYTICS
LOW
1 C in ISS ESG Corporate Rating against industry average of D+.
2
3
Scoring 3.53/5 FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confirms that Redrow Homes plc has been independently
assessed according to the FTSE4Good criteria, and has satisfied the requirements to become a constituent of the FTSE4Good Index Series. Created by the global index
provider FTSE Russell, the FTSE4Good Index Series is designed to measure the performance of companies demonstrating strong Environmental, Social and Governance
(ESG) practices. The FTSE4Good indices are used by a wide variety of market participants to create and assess responsible investment funds and other products.
Copyright ©2023 Morningstar Sustainalytics. All rights reserved. This section contains information developed by Sustainalytics. (www.sustainalytics.com). Such
information and data are proprietary of Sustainalytics and/or its third party suppliers (Third Party Data) and are provided for informational purposes only. They do not
constitute an endorsement of any product or project, nor an investment advice and are not warranted to be complete, timely, accurate or suitable for a particular purpose.
Their use is subject to conditions available at https://www.sustainalytics.com/legal-disclaimers.
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groups4 across the areas we operate
in (find out more about wider
stakeholder engagement on page 118).
Overall, feedback showed that our
strategy was robust and relevant but
that the framework needed to respond
more to the shifting challenges of
certain risks and opportunities. You
can read the full Materiality
Assessment Report on our website.
R E A D M O R E A B O U T O U R
S TA K E H O L D E R E N G AG E M E N T O N
PAG E 1 1 8
Operating review / continued
M ATE R I A LIT Y
Informing our operational framework
update was a detailed materiality
assessment to understand stakeholder
expectations and concerns. The matrix
details the most material issues to our
business and our stakeholders.
The best practice double materiality
process assessed both financial
materiality (the potential impact of
sustainability issues on our financial
value) and impact materiality (how our
activities affect the environment,
people and society). This was based
on in-depth qualitative interviews and
online surveys with a diverse and fair
representation of ten stakeholder
M ATE R I A LIT Y M ATR I X
Homes for All
Homes for All
Biodiversity
Biodiversity
Placemaking
Build Quality
Placemaking
Build Quality
Health
& Safety
Health
& Safety
Environmental
Homes - product
design & lifecycle
Environmental
Homes - product
design & lifecycle
Carbon &
Climate
Change
Carbon &
Climate
Change
Company
Culture
Company
Culture
Resource
Efficiency
Resource
Efficiency
Compliance
& Ethics
Compliance
& Ethics
Water
Water
Sustainable
Procurement
Diversity &
Inclusion
Diversity &
Inclusion
Employee Package
Sustainable
Procurement
Governance for ESG
Employee Package
Other Focus Area
Governance for ESG
Pollution
Prevention
Pollution
Prevention
Skills & Training
Skills & Training
Important Areas
Priority Areas
S
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Other Focus Area
Important Areas
IMPORTANCE TO REDROW
IMPORTANCE TO REDROW
Priority Areas
Thriving Communities
Building Responsibly
Valuing People
Additional Stakeholder Priorities
Thriving Communities
Building Responsibly
Valuing People
Additional Stakeholder Priorities
24
4
Employees, investors, the Redrow Board, suppliers, landowners, local communities, non-governmental organisations (NGOs), local planning authorities, customers
and policy makers.
A LI G N M E NT B E T W E E N O U R O PE R ATI N G F R A M E WO R K A N D
S TA K E H O LD E R PR I O R ITI E S
PILLAR
PROGRAMME
STAKEHOLDER PRIORITY
PAGE
Nature for People
Better Places to Live
Positive Social Impact
Safe by Design and
Operating Responsibly
Putting Our Customers First
Resource Efficiency and
Climate Change
Future Skills
Engaging Our People
and Partners
Biodiversity
Placemaking
Homes for All
Health and Safety
Pollution Prevention
Build Quality
Environmental Homes –
product design and lifecycle
Carbon and Climate Change
Resource Efficiency
Water
Skills and Training
Employee Package
Sustainable Procurement
Company Culture
Diversity, Equality and Inclusion
Diversity and Inclusion
Compliance and Ethics
34
30
39
62
59
46
44
50
58
59
68
67
82
80
72
25
Governance for ESG
165
S E E T H E P L AC E M A K I N G A N D
S U S TA I N A B I L I T Y C O M M I T T E E
R E P O R T I N C LU D I N G O U R
G OV E R N A N C E S T R U C T U R E O N
PAG E 1 6 2
S E E D I R E C TO R S R E M U N E R AT I O N
R E P O R T O N PAG E 1 6 6
S E E O U R R E S P O N S I B L E
B U S I N E S S P O L I C I E S A N D
P R OTO C O L S O N PAG E 1 3 0
R E A D M O R E A B O U T H O W W E
T R E AT C U S TO M E R S FA I R LY O N
PAG E 4 6
G OV E R N A N C E
Oversight for the operational
framework is under the Board-level
Placemaking and Sustainability
Committee, which receives
recommendations and updates from
the three Executive Management
Team pillar owners. The pillar owners
meet annually to approve any revisions
to the framework in consultation with
the Executive Management Team,
while working closely with programme
owners through a series of issue-
focused working groups.
In the last year, we appointed a
dedicated Sustainability Director to
lead the sustainability team and bring
additional ESG expertise to the
business. In September 2022, we
formally aligned remuneration of the
Executive Directors to support the
delivery of our 2030 near-term
Science Based Target initiative (SBTi)
targets.
R E S P O N S I B LE A N D
ETH I C A L CO N DUC T
Our ‘Better’ purpose applies not only
to our customer product, but to how
we do business with our partners and
with one another. The Redrow Code of
Conduct sets out our commitment to
integrity and ethical ways of working,
from safety, supply chain and anti-
bribery; to diversity, human rights and
charitable or political contributions.
The code is backed by a Responsible
and Sustainable Developer Policy that
reinforces our operational framework
commitments.
We expect the same standards of
responsible and ethical conduct from
our suppliers, as outlined in our
Supply Chain Policy and other supplier
documents referenced in this report.
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THRIVING COMMUNITIES
Creating better
places for our
customers to live
26
Placemaking is about how
we plan and design happy
and healthy places to live
– places that complement
the surrounding community
and support nature. This is
fundamental to our business
model and our trusted
position in the marketplace.
Rose Sandell
Group Communities Director
H I G H LI G H T S
1,488
Affordable homes delivered in FY23
1,221
Acres of Public Open Space
delivered on our developments
£305m
Community infrastructure,
S106 spend and Affordable Housing
M AT E R I A L I S S U E S
• Placemaking
• Homes for all
• Biodiversity
C O N T R I B U T I O N TO S D G S
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T he last few years have shone a light
on the real importance of community
cohesion. At Redrow, our philosophy
of placemaking is about how we plan
and design happy and healthy places to live – places
that complement the surrounding community and
support nature. This is fundamental to our business
model and our trusted position in the marketplace. The
Redrow 8 Placemaking Principles is our unique and
auditable framework to help us consistently meet these
needs. They enable us to raise the bar for better, more
sustainable ways for our customers to live.
By delivering across our three strategic programmes
(Better Places to Live, Nature for People and Positive
Social Impact), we contribute to wider socio-economic
value. That’s because we invest in infrastructure like
schools, health centres, shops, parks and green
spaces, as well as affordable homes. We also create
employment, boost local skills and create trading
opportunities, while transparently paying taxes and
making charitable donations to community groups and
charities.
We’re well positioned to respond to evolving
regulation, including the Future Homes Standard and
the National Model Design Code, as well as upcoming
BNG legislation. This is testament to the strong
governance we have in place (see page 165), including
working groups on programmatic action plans. We
drive progress through targets and KPIs so that we can
identify where we can add further value to
communities and other stakeholders.
By creating thriving communities, we contribute to
wider sustainable development, notably SDGs 11
(Sustainable cities and communities) and 15 (Life on
land) through our Nature for People strategy– find out
more on page 266.
O U R AWA R D S
BEST LARGE
HOUSEBUILDER
SILVER
BEST PUBLIC REALM
FOR SAXON BROOK
BRONZE
CADDINGTON
WOODS
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Strategic report
The Orchards, Droitwich,
Worcestershire.
Strategic report
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THRIVING COMMUNITIES
STRATEGY SPOTLIGHT
PLACEMAKING
IN PRACTICE
In the last year, we’ve completed the delivery of a number of new
communities that help meet the nation’s urgent need for quality
homes. These developments go further, by meeting customer
expectations for space, community connection, flexible living and
access to nature.
By rigorously and consistently applying the Redrow 8 Placemaking Principles outlined
below, we can uphold the highest standards of quality, inspirational design and
convenience that underpin the high level of trust in our business.5
The Orchards in Droitwich is one example of the principles in practice. It includes a mix of
241 new homes, a care home, shops, a nursery, play areas, a community orchard and a
wildflower meadow all arranged as a ‘walkable community’ with key destinations within
easy reach of attractive walks for all residents. Together with our consortium partners, we
are seeing a sense of vibrancy and vitality in the new community, even at this early stage.
Here are the principles in practice at The Orchards:
S E E O U R R E D R O W 8 AWA R D -
W I N N I N G D E V E LO P M E N T S O F
T H E Y E A R O N PAG E 3 2
1 . LI S TE N
TO LE A R N :
2 . K E E P I N G
IT LO C A L :
3 . E A S Y TO
G E T A R O U N D :
4 . P L AC E S TO G O
& TH I N G S TO D O :
5 . N ATU R E
F O R P E O P LE :
6 . S TR E E T S
F O R LI F E :
7. H O M E S
F O R A LL :
8 . B U I LT
TO I M P R E S S :
Comprehensive consultation
took place at the planning
stage, with stakeholder
views taken forward in the
innovative design.
The development has been
designed as a ‘walkable
community’ with key
destinations offering easy
and inviting walks for all
residents. A central hub with
a new Co-op store, micro-
pub and nursery are within
walking distance of every
home.
There is an intuitive layout
with a wide choice of routes
for walking and cycling,
including routes into
Droitwich. Paths through the
orchard, meadow and other
green spaces have been
created.
A hilltop park, community
orchard, wildflower meadow
and woodland provide
places to relax or exercise.
The walkable community
provides excellent
connectivity by bike and on
foot. Shops and community
facilities are close to all
homes.
Green corridors, wildflower
meadows, a new orchard
and sustainable drainage
systems combine with
tree-lined roads and on-plot
landscaping.
Streets are designed to be
safe, convenient, and
attractive to walk and cycle
in, with trees and shrubbery.
40% of the homes delivered
are designated affordable,
with a mix of homes to meet
all needs, including 12
one-bed bungalows.
28
5
As evidenced in continued ‘Excellent’ Trustpilot ratings (see page 46).
The homes are all from our
Heritage Collection and
include some of our most
popular and beautiful homes,
such as the Leamington, the
Richmond and the Henley.
Landscaped front gardens
are set along tree-lined
streets with sustainable
urban drainage water
features that create both
kerb appeal and a sense of
harmony with the local
environment.
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THRIVING COMMUNITIES
BETTER PLACES TO LIVE
Creating beautiful, sustainable and inclusive
places for wellbeing.
Delivering a better quality of life
makes our places as attractive as
possible for our customers. All Redrow
developments are guided by – and
audited under – the Redrow 8
Placemaking Principles.
They’re a key aspect of our design and
landscaping manuals, assessment
sheets and score cards. They provide
a focus for all internal design
discussions and the development of
design guidance notes. Every layout is
reviewed by an internal design review
panel that includes members of the
Executive Management Team and the
relevant divisional managing director.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Create beautiful, sustainable and
inclusive places for wellbeing.
100%
100% post completion audit
conducted on completed
developments
R E D ROW 8: M O N ITO R I N G A N D I M PROV E M E NT
Our planning, design and placemaking teams worked hard during the year to meet and
track against the Redrow 8 Placemaking Principles, including:
CO M M U N IT Y
CO N S U LTATI O N
TR A I N I N G
F RO NT
GA R D E N
L A N DSC A PI N G
P OS T- O CCU PA N CY
PL AC E M A K I N G
E VA LUATI O N
Placemaking Principle 1:
Placemaking Principles 5, 6 & 8:
All Placemaking Principles:
As part of a wider initiative to improve
the way we undertake community
consultation, we ran a series of
webinars open to all colleagues,
featuring innovative methods of
engagement from external experts.
Ensuring we consistently achieved
high quality front garden landscaping
for our customers was a particular
focus. This featured prominently in our
internal design seminar and
communications and meetings with
landscape contractors and landscape
designers. These engagements have
prompted us to introduce further
governance of quality, such as auditing
front gardens from an early stage in
the development.
While continuing to gauge residents’
opinion of our developments post
completion (see page 31), we
formalised post-completion
placemaking audits, which were
implemented on all completed
developments6. These help us to
understand where we can go further
on each of the principles, with lessons
shared across the business.
6
Cranberry Gardens, North West; Caddington Woods, South Midlands; St Johns Mews, Yorkshire; The Orchards, Midlands; and The Pastures, North West.
30
100%
Of completed developments
audited against Redrow 8
Placemaking Principles
90%
Of homes are within 500 metres
of public transport
34%
Of developments with community
infrastructure
A BETTER WAY TO LIVE
D E S I G N CO D E S:
A H E A D O F TH E CU RV E
Recent and proposed changes to the planning system will see an
increased focus on the design quality of new developments and how they
reflect the aspirations of the local community. Having applied design
codes on our larger, mixed-use developments for a number of years (in
addition to the Redrow 8 Placemaking Principles), we’re abreast of the
design-focused planning agenda.
For a number of years, we’ve had structures in
place to ensure that all new developments are
informed by the views of local people and that
they are well-connected, landscape-led, deliver
opportunities to interact with nature and, most
importantly, deliver a good quality of life for
residents.
R E A D M O R E A B O U T H O W W E
P R I O R I T I S E Q UA L I T Y A N D
C U S TO M E R S E R V I C E O N PAG E 4 6
Kevin Parker
R E A D A B O U T O U R I N V E S T M E N T
I N A F F O R DA B L E H O M E S O N
PAG E 3 9
PL AC E M A K I N G
LE GACY
The Redrow 8 Placemaking Principles
live on many years after a
development is completed – a 2022
HomeViews survey of more than 800
residents who’ve lived at three
completed developments revealed
that they continued to enjoy
placemaking benefits, indicating that
their communities have really started
to thrive:
• 87% of residents said that there was
a good sense of community
• 80% said that environmentally
sustainable features were important
to them
• 93% said that it was easy to access
nature in their area
R E A D M O R E A B O U T T H E S E
R E S I D E N T S ’ V I E W S O F R E N E WA B L E
E N E R GY F E AT U R E S O N PAG E 4 4
Group Master Planning Director
The Plasdŵr Design Code has provided
a framework for the delivery of this
innovative 21st century garden city.
At Plasdŵr in Cardiff, we’ve created a comprehensive design code that’s
been developed in close collaboration with the local planning authority.
The code is proving to be instrumental in offering a strategic framework
for quality, driving how we will create well-connected green corridors and
other sustainable infrastructure. It’s also helping to ensure that each of
the five neighbourhoods has a distinctive identity through the use of
materials, details, colour and landscaping, while unifying the approach
across multiple phases in different geographical locations.
V I S I T O U R P O D C A S T TO H E A R M O R E
A B O U T T H E P L A S D Ŵ R D E S I G N C O D E
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THRIVING COMMUNITIES
PL AC E M A K E RS O F TH E Y E A R
For the third consecutive year, we’ve held our internal placemaking awards to
recognise the best delivered examples of each of the 8 Placemaking Principles.
Our FY23 winners are set out opposite.
R E D ROW 8 AWA R D - W I N N I N G
D E V E LO PM E NTS
Tabley Park
B U I LT T O I M P R E S S
Foxbridge Manor
S T R E E T S F O R L I F E
The Orchards
P L A C E S T O G O A N D T H I N G S T O D O
TA B LE Y PA R K
FOX B R I D G E M A N O R
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Early delivery of a focal green space, play area, beautiful
streets and landscaping create an impressive place to live.
Well-landscaped streets and front gardens as well as
pedestrian and cycle-friendly routes encourage activity.
TH E O RC H A R DS
M I LL M E A D OWS
A walkable community including shops, a micro-pub, a
nursery, an orchard and a wildflower meadow.
New habitats for bats, insects and birds have been
created as well as new connections to the coastal path.
M I LLV I E W PA R K
C H U RC H L A N DS
Churchlands
E A S Y T O G E T A R O U N D
Mill Meadows
N AT U R E F O R P E O P L E
The Mill at Springfield
H O M E S F O R A L L
Yew Gardens
K E E P I N G I T LO C A L
Millview Park
L I S T E N T O L E A R N
Comprehensive engagement with the local community
including a review and response to all questions raised.
A segregated walking and cycle route is incorporated
along with off-road walking routes and cycling trails.
TH E M I LL AT S PR I N G F I E LD
Y E W GA R D E N S
32
An attractive community including affordable housing
arranged in courtyards and apartments in landmark buildings.
A locally distinctive palette of roughcast render and brown
tiles root our Heritage Collection into the local context.
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THRIVING COMMUNITIES
NATURE FOR PEOPLE
Putting nature, people and wellbeing at the
heart of our developments.
Biodiversity decline has become a
pressing global issue, inextricably
linked to climate change. We
recognise biodiversity as a material
financial and reputational risk to
Redrow – as do our stakeholders.
Our Nature for People strategy and
Biodiversity Net Gain (BNG)
commitments are delivering tangible
benefits for nature and people, with
nature-rich green spaces supporting
wildlife, as well as health and
wellbeing for residents. They also help
to attract and satisfy customers – just
one of the many ways in which our
developments stand out in the
marketplace.
B I O D I V E RS IT Y
STR ATE GY
Our biodiversity strategy, Nature for
People, became fully integrated into
the Redrow 8 assurance and post-
completion audit process in FY23 (see
page 29). Developed in partnership
with the Wildlife Trusts in 2020, it goes
beyond BNG, with 15 commitments to
actively retain, enhance and create
new natural habitats on our
developments.
Engaging residents and wider
communities with nature is critical to
building lasting stewardship of natural
spaces and wildlife. In FY23, we
mapped the customer journey in order
to ensure information on each
development’s natural environment is
communicated at key points, from
initial customer interest, to how
residents can enjoy nature in their
everyday lives. Examples of
communications being developed
include online content, site signage
and move-in information for residents.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Put nature, people and wellbeing at
the heart of our developments.
28%
100% of planning applications
with at least 10% BNG after
November 20238.
A C O M P R E H E N S I V E S T R AT E GY TO P R OT E C T A N D E N H A N C E B I O D I V E R S I T Y
Biodiversity Net Gain
(BNG)
• Measures habitats
only; within red-line
boundary
• 30-year management
and monitoring
requirement
Species Focus
• Species protection
& mitigation
• Provision of homes
for wildlife
34
Nature for People Strategy
• Assessment of impact on
adjacent habitats
• Connectivity with other habitats
(e.g. Nature Recovery Networks)
• Can we exceed 10% BNG?
• Locally relevant planting
• Multi-functional green and blue
infrastructure
• Nature is accessible for people
• Edible landscapes
• Engaging people in care and
use of natural spaces
• Monitoring & reporting of
outcomes for nature and people
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Acres of public open space 7
S E E O U R E S G H U B O N PAG E 2 5 2
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
O U R AWA R D S
BIG BIODIVERSITY CHALLENGE
AWARD, CADDINGTON WOODS
PROJECT OF THE YEAR
The Finches, Halewood,
Liverpool.
B I O D I V E RS IT Y
N ET GA I N
BNG is an approach to contribute to
the recovery of nature while
developing land. It seeks to leave the
natural environment in a measurably
better state than it was before
development. Regulation on BNG will
apply from November 2023 to all
Redrow developments in England. We
therefore began measuring BNG on all
new land purchases in FY23 and we’re
pleased to report that 45% of planning
applications8 granted in the year are
forecast to achieve a net gain for
biodiversity. 28% of these successful
planning applications8 are forecast to
achieve more than a 10% increase in
biodiversity. The remaining 55% of
applications pre-date our target and
therefore calculations had not been
carried out at the time of submission.
Ensuring regulatory preparedness and
ongoing benefits for nature, customers
and the business, we’re looking at how
to achieve meaningful gains for nature
across the Group. We have further
embedded BNG into existing business
practices, developing specific
governance structures, built capacity
within our teams and engaged
contractors and consultants. For
example, in FY23, we:
• created a BNG manual9, which sets
out our approach in line with our
Nature for People strategy;
• engaged landscape designers to
develop a new design brief, which
sets out BNG and placemaking
requirements for all new
development designs;
• met with key landscape contractors
from all regions to ensure successful
delivery and establishment of new
landscaping;
• trained and engaged teams with
‘biodiversity bites’ lunch and learns,
as well as BNG roadshows with all
divisions to share best practice,
problem-solve and review designs
collaboratively; and
• engaged with wider stakeholders in
the absence of secondary legislation
or government guidance for BNG,
including the Future Homes Hub
Biodiversity Net Gain Groups and
UKGBC.
7
Land on our live developments which is retained or created as green space, or landscaped communal areas.
8 Full and reserved matters applications only.
9
The manual emphasises that gains are relevant to the site context and connectivity, an integral part of our approach to placemaking and connecting communities with
nature, and are maximised by strong design process and principles, with consultants delivering strong advice to help achieve BNG.
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THRIVING COMMUNITIES
Mill Meadows, Sudbrook,
Monmouthshire.
A BETTER WAY TO LIVE
N ET B E N E F ITS FO R B I O D I V E RS IT Y
I N WA LE S
The planned approach in Wales will not require the use of a Biodiversity
Net Gain calculation, rather it focuses on Net Benefits for Biodiversity on
new developments. It will deploy ecologists to consider biodiversity and
wider ecosystem benefits within a placemaking context early in the
design process.
We welcome this development-tailored approach, which aligns well with
our broader Nature for People strategy, and have been engaging with the
Welsh Government, including feeding into its consultation on proposed
changes to Chapter 6 of Planning Policy Wales where we’re supportive of
the overall concept.
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M E ETI N G TH E N E E D FO R G R E E N
Living near green space has become a key priority for customers when
looking at community facilities around new homes9. In FY23, we
progressed more developments that delivered on this and that also
created habitats to support biodiversity. Examples included:
Langley Grange, West Yorkshire
Our homes are surrounded by beautiful green spaces for residents and
wildlife to enjoy. This is a living example of our commitment to biodiversity
and sustainability, with achievements on many fronts – from over six acres
of public open space, including three newt ponds, meadow habitats, bird
and bat boxes and even special underpasses for great crested newts; to
ground-breaking projects focused on reducing the amount of waste
created when we build our homes and creating a prototype fossil fuel-
free, low carbon home.
The detailed landscape masterplan ensured that existing tree belts,
hedgerows and dry-stone walls were protected, with new areas of
planting to reflect the local mix of species. Natural meadows at the
eastern end of the site safeguard the setting of the river Dearne and
reflect the aims of our Nature for People strategy to create less formal
landscaped areas that can support a wide variety of wildlife.
Mill Meadows, South Wales (Redrow 8 winner)
This 100-acre site of a former papermill is a clear example of how nature
has been considered across the development lifecycle. Existing roosting
populations of the endangered Lesser Horseshoe bat have successfully
relocated to the new purpose-built bat house and are now breeding at the
site for the first time – a real boost to populations of this species. New
slow worm refuges have been created in the retained woodland, and the
new community enjoys access to large areas of green open space in a
stunning location next to the Severn Estuary.
9 Source: Office for National Statistics.
U P STR E A M
B I O D I V E RS IT Y
Alongside extensive work to deliver
our Nature for People strategy and
prepare for BNG regulations, we’ve
started to scope work to assess the
indirect risks and dependencies on
nature in our supply chains. In FY24,
we will begin mapping supply chain
impacts on nature, starting with
priority suppliers and materials – this
closely aligns with our work on Scope
3 emissions (see page 54).
N UTR I E NT
N E UTR A LIT Y
We’re committed to playing our part in
tackling high nitrate and phosphate
content in rivers and coastal waters.
We know that the main source of
nutrient pollution is agriculture,
followed by sewage effluent from
industry. However, at our
developments in sensitive river
catchment areas, we’ve been working
hard to find innovative solutions, such
as replacing low-value agricultural
land with biodiverse green
infrastructure, creating wetlands and
building on-development wastewater
treatment works. We’ve been sharing
learnings with our industry along the
way, via the Future Homes Hub, for
instance.
These solutions are proving slow to
implement due to licencing agency
delays and limited local authority
solutions. Alongside our peers and the
HBF, we will continue to lobby the
government around extending the life
of planning permissions in affected
areas. We welcome government
requirements for water companies to
upgrade treatment works by 2030, the
proposed Nutrient Mitigation Scheme
and recent government announcement
aimed at amending the current legal
system.
R E A D O U R D I S C LO S U R E S
U N D E R TC F D O N PAG E 1 0 2
R E A D A B O U T O U R R I S K
M A N AG E M E N T P R O C E S S E S
O N PAG E 8 8
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THRIVING COMMUNITIES
POSITIVE SOCIAL IMPACT
Creating positive outcomes and making a
difference to the communities within which
we develop.
We seek to maximise social value
created by our developments. This
means helping people connect, feel
safe and enjoy the communities we
create. Local stakeholder engagement
is fundamental to the success of this
and, from the design phase, we work
closely with planning authorities,
residents and community groups to
understand and support local needs.
This continues throughout building
works when we work to uphold the
standards of the Considerate
Constructors Scheme – see page 64.
In FY23, a national social value
taskforce sought to leverage more
private sector investment for social
outcomes, while local authorities and
investors showed increasing interest in
Professor Helen Dodd from Exeter University and Kevin Parker, Redrow's Group
Master Planning Director at the launch of our report 'Placemaking To Playmaking'.
ESG performance in this area. In
response, we’ve been building our
understanding of the positive social
impact that our developments create,
including how we measure social
return on investment. We have also
undertaken a series of related best
practice workshops with our regional
teams, led by external experts, for
example “injecting social value into
community and stakeholder
engagement”.
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H O M E S FO R A LL
As described on page 40, our
developments and wider operational
presence in England and Wales
brought significant financial and
non-financial value to society in FY23.
We built 1,488 affordable homes and
invested £258m in partnership with
Registered Providers – many of which
have long-standing roots in the local
area – to meet long-term community
needs. Redrow affordable homes
blend seamlessly into the rich variety
of housing types within our Heritage
Collection, with the same ‘kerb appeal’
and built using the same material book
and high quality specifications.
We invested £47m in broader
community infrastructure, including
schools, shops, care homes,
community/health centres and S106
spend. We also trained 349 people
primarily through apprenticeships or
graduate placements. Finally, we
contributed £170m in public taxes and
made £0.2m of charitable donations
(see page 194).
1,488
Affordable homes delivered
£0.2m
Donated to charity
R E A D M O R E A B O U T H O W O U R
B U S I N E S S M O D E L C R E AT E S VA LU E
F O R S TA K E H O L D E R S O N PAG E 1 2
A BETTER WAY TO LIVE
LI STE N TO LE A R N
As the first of our 8 Placemaking Principles, we take a
holistic ‘listen to learn’ approach when designing our
communities. In the last year, we’ve seen this in action
in our pioneering research and engagement around
children’s play in their local communities.
FROM PLACEMAKING
TO PLAYMAKING:
ENCOURAGING
COMMUNITY PLAY
ACROSS THE UK
We partnered with Play England, Play Wales and
Professor Helen Dodd from Exeter University on a
detailed report into family needs when it comes to
spaces for children to play. The paper, ‘Placemaking To
Playmaking’, has shown that:
1
• 21% of parents have considered moving to a cul-de-sac to allow their
children to play in the street.
• 40% said having a safe space for children to play is within the top three
things that would attract them to a new home.
• 54% were keenly aware of the benefits of outdoor play for their child’s
physical health.
I hope through my work with Redrow, all
housebuilders will be inspired to create
environments where children feel welcome and
safe to play outdoors.
Professor Helen Dodd
University of Exeter
Getting outside to play is one of the best ways to
connect. It provides the building blocks for children’s
confidence, and gives them an opportunity to learn
about the world around them. Parents meet other
parents. Foster their friendships over a swing, a
coffee in the park or kicking a ball in the field.
R E A D M O R E A B O U T O U R
I N V E S T M E N T I N T R A I N I N G
A N D S K I L L S O N PAG E 7 6
Kevin Parker
Group Master Planning Director
S E E O U R E S G H U B O N PAG E 2 5 2
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
We’re now taking forward the findings of the report to design-in safe, high
quality, innovative play spaces, as well as launching a national playmaking
campaign to encourage children and families to spend more time
outdoors and engage in the art of play. Visit www.redrow.co.uk/
playmaking to read the report and find out more.
38
R E A D M O R E A B O U T S TA K E H O L D E R E N G AG E M E N T O N PAG E 1 1 8
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THRIVING COMMUNITIES
SO C I A L VA LU E H I G H LI G HTS I N F Y23
The table below illustrates some of the economic, social and environmental value we have created in FY23.
£305m
Community infrastructure,
S106 spend and Affordable
Housing.
£170m
Tax contributions
(Includes; corporation tax,
employers social security,
PAYE, SDLT & council tax).
1,221 acres
Public Open Space – Land on
our developments retained/
will be retained as green
space or landscaped
communal areas.
90%
Of developments are within 500 meters of public
transport.
34%
Of developments with community infrastructure
(e.g. Buildings providing educational, youth,
community, healthcare etc).
48%
Reduction in Carbon
Emissions (Scope 1 & 2)
tonnes of CO2e from a 2021
baseline year.
98.29%
Of waste diverted from
landfill FY23.
2.07
Tonnes of CO2e per 100m2 of
build (scope 1 and 2, location
based) a reduction of 27%
against 2021 baseline.
28%
Of planning applications (full and
reserved matters) granted in the
year are forecast to achieve a
>10% net gain for biodiversity.
8.82
Tonnes of construction waste
per 100m2 of build (new target
of 10% against a baseline year
of 2021).
39.5
Average CCS score FY23.
1,495
Subcontractor
companies supported.
15.9%
Of the direct workforce are trainees
and apprentices.
2,708
Suppliers supported.
£0.2m
Charitable donations.
349
Trainees, apprentices
and graduates.
£258m
27.4%
Capitalised value of affordable housing.
Of all our homes delivered are affordable.
40
A BETTER WAY TO LIVE
C R E ATI N G SOC I A L VA LU E I N TH E
N O RTH W E ST
At Woodford Garden Village in Cheshire, we’ve been ensuring that the
development will maximise social and economic value for the local area.
Once completed, the community will add more than 900 much-needed
homes, including 121 affordable homes and 104 Extra Care apartments
and bungalows delivered in partnership with Registered Providers of
affordable housing.
We’ve invested a further £4.4m in community infrastructure, including
£3.5m for a primary school, community centre and 19 public open spaces
(parks, sports pitches, play areas, meadowland and a village green). We
plan to invest a further £5.2m, meanwhile, £40,000 has been set aside as
a community fund, which has so far supported 36 community groups,
charities, schools and sports clubs. Investing in the future pipeline of
talent, the Woodford construction team has hosted 100 quantity surveying
students from Salford University and placed four trainees. We have also
delivered lectures during national apprenticeship week and regular
‘careers in construction’ talks at nearby schools.
The development received a score of 100% from NHBC in its Construction
Quality Review and a top score of 45/45 from the Considerate
Constructors Scheme.
£9.6m
Community investment pot
36
Charities and community
groups supported
45.92
Acres public open space
100
Students site visits
Gardening equipment, seeds and planters were provided to several
schools across the North West including Woodford Primary School
(pictured above) as part of Redrow’s Get Set Grow initiative.
Redrow’s community fund supported the Hearing Dogs for Deaf
People charity. This was used for their training centre to train pups
and volunteers.
T H R I V I N G C O M M U N I T I E S – W H AT ’ S N E X T ?
As we work towards our 2024 targets, we plan to test
innovative digital consultation techniques to further
refine how we effectively and meaningfully engage with
communities.
We also plan to conduct a social value gap analysis,
which will help to inform the development of a strategy
by June 2024. This will help guide colleagues in
delivering long-term social value on our sites.
As part of our commitment to ensuring a lasting positive
legacy for our developments, we will also begin phase
2 of post-occupancy placemaking evaluations, with
in-depth research into the quality of life and
experiences of residents living in established Redrow
communities.
We are well prepared for the new BNG legislation and
will continue to track our BNG outcomes for all our new
developments to align with our target to ensure 100% of
planning applications achieve at least 10% BNG after
November 2023.
S E E O U R E S G H U B O N PAG E 2 5 2
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
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BUILDING RESPONSIBLY
Putting customers
first and working
safely, considerately
and sustainably
We’re committed to
upholding the highest
standards of quality, safety
and sustainability. This
applies in our builds, our
operations and in how we
interact with customers and
wider stakeholders.
Tim Stone
Regional Chief Executive for
Western and London
H I G H LI G H T S
90%
HS&E average assurance
inspection score
98.3%
Waste diverted from landfill
15%
Reduction in Scope 1 and 2
GHG emissions
M AT E R I A L I S S U E S
• Health & safety
• Carbon & climate
change
• Resource
efficiency
• Water
• Product design &
• Build quality
lifecycle
• Pollution
prevention
C O N T R I B U T I O N TO S D G S
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A s outlined in the Redrow Code of
Conduct and our Responsible and
Sustainable Developer Policy, we’re
committed to upholding the highest
standards of quality, safety and sustainability. This
applies in our builds, our operations and in how we
interact with customers and wider stakeholders. It’s
why we can be particularly proud of sustained high
ratings from the HBF, NHBC, Redrow residents and the
wider public.
With our near-term net zero carbon targets validated
by SBTi, we doubled down on initiatives to
decarbonise Redrow homes and operations during the
year – from trailblazing home electric heating solutions
that go further and faster than current building
standards, to securing renewable energy contracts and
electric company cars. With the support of expert
consultants, we’re now working on a long-term net
zero-carbon route map, while strengthening our risks
and opportunities analysis, as shown in our TCFD
report on page 102. We’re also mapping and beginning
to address value chain emissions, starting with
suppliers.
Fundamental to building responsibly is a commitment
to continuous improvement on health, safety and the
environment. Our HS&E Policy and Strategy, combined
with performance-linked director remuneration (see
Director's Remuneration Report on page 180) make
clear Redrow’s unwavering position on this. In FY23,
we’re pleased to report that we averaged a score of
90% for our HS&E assurance inspections, exceeding
our target of 87%. In the spirit of continuous
improvement, we continue to review and enhance
operating procedures, while learning from any HS&E
incidents or accidents.
By upholding high HS&E standards, we contribute to
wider sustainable development, notably SDGs 8
(Decent work and economic growth), 12 (Responsible
consumption and production) and 13 (Climate action) –
find out more on page 266.
O U R AWA R D S
42
BEST ENVIRONMENTAL
PRACTICE
BEST APPLICATION
OF TECHNOLOGY
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BUILDING RESPONSIBLY
STRATEGY SPOTLIGHT
TRAILBLAZING
ENERGY-SMART HOMES
Ahead of the government’s proposals to decarbonise new-build
homes from 2025 (part of the Future Homes Standard), we were
the first large homebuilder to incorporate Air Source Heat Pumps
(ASHPs) and underfloor heating as standard in Redrow houses.
10
Our Eco Electric properties went on
sale in December 2022 and will
enable customers to make further
savings on their energy bills beyond
the £2,600 a year average saving from
purchasing a new-build as opposed to
an older property 11. Critically, the
homes will also achieve an average of
77%12 emissions savings – a significant
contribution to our net zero carbon
value chain goals (see page 50), while
also aligning with customers’ goals to
lower their carbon footprint.
Redrow homes, which are typically
larger (including bigger gardens) and
more open plan than other new-builds,
lend themselves particularly well to
ASHPs. We tested the technology over
the last 2 years and collaborated with
the supply chain in undertaking trials
in our customers' homes to understand
the customer experience in greater
depth.
We also trialled an artificial
intelligence-based home energy
management system that learns from
light switches, batteries, solar panels
and other sources to reduce
consumption and maximise the use of
renewable and off-peak energy. While
not selected for rollout yet, the trial
provided valuable data on how our
homes perform, how residents are
consuming energy and their comfort
and enjoyment levels.
high efficiency boilers and ventilation
systems. With newbuilds 53% more
efficient than 1970s properties, our
Eco Electric homes achieve an
additional 10% reduction in heat loss.
A recent survey from HomeViews
reiterated that residents of our homes
welcome the cost and quality benefits
of our energy efficiency and
renewable energy features (see table
opposite).
We continue to assist customers and
prospective customers to help realise
potential further cost and carbon
savings. In FY23, we rolled out energy
calculators at our Customer
Experience Suites in another industry
first (see page 275).
B
Average Energy Performance
Certificate (EPC) rating,
Redrow homes
We are an active member of
the Future Homes Hub
The move to ASHPs ensures our future
homes are ‘zero-carbon ready’ for when
the grid is decarbonised and supports our
goal of achieving science-based net zero
emissions no later than 2050 across our
operations, homes and supply chain.
ASHPs build on our proven track
record of thicker, quality insulation and
Matthew Pratt
CEO
44
10
11
12
Underfloor heating is standard in detached homes and the majority of our smaller homes.
Based on HBF analysis and reflecting the Energy Price Guarantee increases on 1 April 2023.
Emissions reductions based on Dwelling Emissions Rate comparison with new Eco Electric home design.
Our Eco-electric media campaign was rolled out nationally
to launch our new generation of eco-electric homes.
R E S U LT S O F H O M E V I E W S S U R V E Y A S K I N G R E S I D E N T S "A R E
E N V I R O N M E N TA L LY S U S TA I N A B L E F E AT U R E S I M P O R TA N T TO YO U ? "
P E R C E N TAG E
A N S W E R I N G
" Y E S "
P E R C E N TAG E
A N S W E R I N G
" N O "
80% 20%
72% 28%
I N T H E W O R D S O F O U R C U S T O M E R S
Who doesn’t want to
reduce their fuel bills
and do their bit for the
environment? I’m really
happy with the way that
the air source heat pump is
performing.
James
Redrow homeowner who took part
in the Mitsubishi Electric trial at
Great Milton Park, South Wales
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BUILDING RESPONSIBLY
CUSTOMERS FIRST
Consistently delivering high quality, efficient
homes for our customers.
Making people’s lives better through
our homes goes to the core of our
purpose (see page 6). Despite
consistently high Trustpilot and HBF
ratings over the years, we don’t take
customer loyalty or our respected
position in the market for granted.
It’s why our master planners and
designers are continuously finding
new and creative ways to meet the
changing needs of our customers and
the communities we work in. It’s also
why we design-in technologies and
features that make lives easier,
reflecting Redrow 2025 innovation
principles. We also invest significantly
in people and systems to uphold our
quality and service standards,
ensuring we rectify and learn from any
issues that come to our attention.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Consistently deliver high quality,
efficient homes for our customers. 4.49
0.19
50.20%
90.8%
Average Trustpilot Score 4.3.
0.15 or less reportable items per
NHBC inspection.
NPS of 54%.
Customer Satisfaction rating
(recommend to a friend) 94%.
I N T H E W O R D S O F O U R C U S T O M E R S
Q UA LIT Y A N D S E RV I C E
Redrow kept us involved
with the build of our new
Cambridge home from the
foundations! We highly
recommend Redrow. This
is a lovely neighbourhood
already! We’re looking forward
to making lots of memories in
our forever home.
Rebecca
Whitehall Grange Development
Quality remains one of the top material issues for our stakeholders (see
page 24) and we’ve earned our reputation for consistently delivering
homes to a superior standard, as evidenced in ‘Excellent’ Trustpilot
ratings and five-star HBF ratings for five years running. In FY23, we
scored an average review rating of 4.5 from Trustpilot and exceeded
our targets for NHBC Construction Quality Reviews, achieving 4.56 out
of 613, with 87% of our build stages rated good to outstanding
(exceeding our target of 82%).
However, we recognise scores have declined slightly from the previous
year – for instance, 82% of new homes were handed over to customers
defect-free, compared to 90% in FY22, while the NHBC found more
Reportable Items (RI) (0.19 versus 0.17 in FY2214). We also fell short of
our high benchmark for customer experience targets – with a 50.2% Net
Promoter Score (NPS) and 90.8% customer satisfaction (against targets
of 54% and 94% respectively).
Based on over 6,796 reviews
15
A total of 90.8% of customers would
recommend Redrow to a friend after
eight weeks’ occupancy (HBF Survey)
– this compares to 94.5% the previous
year.
This is now the fifth consecutive year
that Redrow has successfully secured
a Five Star HBF rating.
We’ve further improved how we
identify, report and manage defects.
For example, our RedSMI site manager
inspection app has been enhanced
with geotagging.
We’ve also implemented a new
three-stage complaints process, which
better captures the root cause of any
issues to feed-back into continuous
quality improvement.
Following the success of our
Homeowner Support Portal, with over
90% of customers submitting their
warranty issues online, we’ve formed a
new team of existing colleagues to
centrally assign work instructions to
relevant contractors. This has led to
better consistency, response times
and efficiency when dealing with
warranty items raised.
S E E O U R E S G H U B O N PAG E
2 5 2 F O R M O R E I N F O R M AT I O N
O N O U R P E R F O R M A N C E A N D
TA R G E T S
46
13
14
4 being good and 6 outstanding.
The NHBC records RIs when it notes any instances where we fail to meet its technical standards or building regulations. The higher the score, the more failures found.
15
90.8% of customers would recommend us to a
friend eight weeks after completing purchase.
A BETTER WAY TO LIVE
TH E H A M P STE A D: FO R FA M I LI E S
LOO K I N G FO R F LE X I B I LIT Y
The Arts & Crafts-style Hampstead design launched in FY23 has rapidly
become a sought-after addition to our Heritage Collection. Designed to
be more affordable than other five-bedroom properties in the collection,
while being equally characterful and aspirational, the Hampstead appeals
to larger families looking for a moderately-priced five-bedroom home with
space, flexibility (e.g. home working areas), low maintenance and high
energy-efficiency.
I N T H E W O R D S O F O U R C U S T O M E R S
We chose a Hampstead because it’s big and perfect
for big families like us, with more bedrooms and
more space. The Hampstead design is unique and
something which makes it stand out from any other
homes that we have seen so far.
Suhana Sajawal
Hampstead homeowner at Bishop Meadows, Oldham
High quality service will always be our
priority, and most importantly this will always
be informed by our customers.
Emma Morris
Customer and Quality Director
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BUILDING RESPONSIBLY
As well as a seamless self-managed buying
process, help is also available by visiting one
of our Customer Experience Suites.
FA I R N E SS A N D
TR A N S PA R E N CY
We support legislation that helps
protect and support consumers (and,
in turn, the reputation of home
builders), particularly those who may
be vulnerable. We were one of the first
in our sector to go live with the New
Homes Quality Board Code of Practice
to offer better protection and
increased transparency for customers.
Its fundamental principles16 are now
part of our customer strategy,
compliance, complaints and
monitoring procedures (e.g. mystery
shopping), as well as colleague
training, including programmes in
adapted services for vulnerable
customers.
We continue to uphold high standards
of responsible marketing, data
protection and information security.
We’ve launched an online portal that
enables live tracking and resolution of
customer complaints, with integration
to design and build quality control
systems to ensure continuous
improvement. We’re delighted to see a
29% reduction in formal complaints,
with 99% of those reported being
closed within our target timeframes
(which are shorter than the standards
set out by the NHQB Code).
S E E O U R DATA P R I VAC Y N OT I C E
AT R E D R O W.C O.U K
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A BETTER WAY TO LIVE
TA K I N G TH E STR E SS OUT O F
H O M E - BU Y I N G
From Redrow (and wider market) customer surveys, we know that people
want a seamless, self-managed buying process, with Redrow experts on
hand to speak to at any time. This spans initial interest, right through to
move-in day and the months afterwards. For prospective homeowners,
Customer Experience Suites offer virtual viewings (including award-
winning drone footage) and real-time availability of homes, as well as
interactive information on unique features like ASHPs, underfloor heating
and, new in FY23, EPC calculators to help understand the energy savings
they could make.
At purchase (or selling) stage, customers have the option of completing the
entire process from their smartphone, using the My Redrow platform to
reserve and personalise a property, message securely with experts and
view virtual tours of their future home. Since pioneering these bespoke
video messaging two years ago, customer experience colleagues have
created more than 20,000 clips. At the same time, customer hard hat tours
remain highly popular. Once moved in, My Redrow continues to provide
excellent aftersales support and customers can access advice and report
any issues instantly via our highly-acclaimed Homeowner Support portal,
now used by 90% of customers. Meanwhile, the new homeowner support
team is available to offer friendly, expert help.
Overall, our digital/real-world model of customer servicing is working – as
evidenced by customer feedback and validated in cross-sector awards, such
as the Institute of Customer Service Customer Satisfaction Awards 2023.
I N T H E W O R D S O F O U R C U S T O M E R S
Excellent customer service, communication and care!
Thank you Redrow!
Barbara J
via Trustpilot
The short video messages that you both sent made
the experience more special and I very much liked
that. Makes buying a new home even more exciting.
Mrs. W
via Trustpilot
The reporting system on My Redrow is easy to use
and responses are very prompt.
Marie Whiteley
via Trustpilot
BEST USE OF SOCIAL
MEDIA, RECREATE
REDROW CAMPAIGN
BEST APPLICATION OF
TECHNOLOGY, UK CUSTOMER
SATISFACTION AWARDS
48
16
Fairness, safety, service, responsiveness, transparency, independence, inclusivity, security and compliance.
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BUILDING RESPONSIBLY
CLIMATE CHANGE
Transition to a low carbon and more efficient
business and deliver zero-carbon ready homes.
Redrow is ahead of the game when it
comes to taking action on climate
change by implementing measures
before they become regulation. We're
in a strong position to respond to
consumer pressures, and to manage
the risks posed by climate change,
reducing any financial and reputational
risks.
Taking rapid and informed action is
not only the right thing to do as a
responsible business, but it’s critical
to how we reduce exposure to risk,
address stakeholder materiality
concerns, and, above all, deliver better
homes and thriving communities.
Our vision is to achieve
decarbonisation across the whole
value chain, while ensuring we’re
resilient and adaptive to a changing
climate. In realising this vision, we will
continue to create financial value
through new market and supply chain
opportunities, while contributing to
national and global climate goals.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Transition to a low carbon and more
efficient business and deliver
zero-carbon ready homes.
48% reduction
against baseline
(8,318 tCO2e)
Reduce operational (Scope 1 and
2)17 emissions by 42% by 2030
against a FY21 baseline.
6.1% reduction
against baseline
(1,073,070 tCO2e)
Reduce homeowner and supply
chain (Scope 3) emissions by 25%
by 2030 against a FY21 baseline.
TH E R E D ROW C LI M ATE V I S I O N
Eliminate carbon from all
our business operations.
Deliver attractive
zero-carbon homes and
communities, which
people aspire to buy
over the competition.
Buy products and
materials which have
low or no embodied
carbon.
R E D U C E
C A R B O N
E M I S S I O N S
A DA P T TO A
C H A N G I N G A N D
U N P R E D I C TA B LE
C LI M AT E
Keep all our employees and
subcontractors safe from any
harmful impacts associated
with climate change while
at work.
Design and build homes
and communities that are
comfortable and resilient in
the face of a changing climate.
Source products and
materials at least risk from
climate disruption.
Deliver beautifully landscaped and biodiverse developments, which play a role in absorbing carbon, provide a
cooling effect and support people’s wellbeing and nature’s recovery.
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A B SO LUTE SCO PE 1 A N D 2 E M I S S I O N S (t CO 2e)
2021
2022
2023
Mains Gas – Offices
Mains Gas – Sites and Plots
LPG – Sites
Diesel – Sites
Business Travel
Air Conditioning
Electricity – Offices
Electricity – Sites and Plots
Heat – Sites and Plots
214 tco2e
3,622 tco2e
279 tco2e
6,349 tco2e
943 tco2e
10 tco2e
348 tco2e
4,302 tco2e
32 tco2e
Total tCO2e market based
16,099
Mains Gas – Offices
Mains Gas – Sites and Plots
LPG – Sites
Diesel – Sites
Business Travel
Air Conditioning
Electricity – Offices
Electricity – Sites and Plots
Heat – Sites and Plots
HVO
162 tco2e
2,477 tco2e
275 tco2e
5,830 tco2e
803 tco2e
10 tco2e
181 tco2e
0 tco2e
81 tco2e
3 tco2e
Total tCO2e market based
9,822
Mains Gas – Offices
Mains Gas – Sites and Plots
LPG – Sites
Diesel – Sites
Business Travel
Air Conditioning
Electricity – Offices
Electricity – Sites and Plots
Heat – Sites and Plots
HVO
163 tco2e
2,159 tco2e
326 tco2e
4,358 tco2e
711 tco2e
9 tco2e
124 tco2e
409 tco2e
59 tco2e
0.45 tco2e
Total tCO2e market based
8,318
OUR NET ZERO
CARBON COMMITMENT
Our commitment is to achieve net zero
greenhouse gas (GHG) emissions no
later than 2050. We’ve worked with
the Carbon Trust to set near-term
targets against a 2021 baseline. These
have been validated by the Science
Based Targets initiative.19
We’re now working on our plans
beyond 2030, including undertaking
feasibility studies to set long-term
targets for validation by SBTi. We will
also align our net zero-carbon route
map with the Transition Plan Taskforce
Disclosure Framework that seeks to
enable companies to create rigorous
transition plans to net zero carbon.
R E A D O U R D I S C LO S U R E S U N D E R
TC F D O N PAG E 1 0 2
R E A D A B O U T O U R R I S K
M A N AG E M E N T P R O C E S S E S O N
PAG E 8 8
R E A D A B O U T O U R S TA K E H O L D E R
E N G AG E M E N T O N PAG E 1 1 8
S E E O U R N AT U R E F O R P E O P L E
S T R AT E GY O N PAG E 3 4
50
17
18
The GHG Protocol defines three categories of emissions: Scope 1 are those created directly (e.g. gas and owned vehicle fuel use); Scope 2 emissions are indirect,
including electricity or purchased energy; and Scope 3 are those indirectly created up and down the value chain, including supplier chain and customer home occupancy.
Emissions based on externally verified 2022 data. 2023 data will be reported next year when available.
19
Targets are considered science-based if they are designed to meet the goals of the Paris Agreement international treaty to limit warming within 1.5oC. It was adopted
by 196 parties at the UN Climate Change Conference in Paris, France, on 12 December 2015.
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Operating review / continued
BUILDING RESPONSIBLY
R E DUC I N G
O PE R ATI O N A L
E M I SS I O N S
In FY23, our total Scope 1 and 2 GHG
emissions were 8,318 tonnes of carbon
dioxide equivalent (tCO2e). This
represents a 15% decrease on the
previous year and is equivalent to 1.67
tCO2e per 100m2 build. This is also a
48% reduction in emissions against
our FY21 baseline year, putting us well
on our way to achieving both our near
term carbon reduction target and our
net zero carbon target.
Our latest CDP rating for climate
change disclosure is C. See the full
disclosure here: https://www.cdp.net
During the year, we’ve expanded and
strengthened decarbonisation
initiatives across our operations,
including:
• Reducing on-site diesel: We further
reduced our use of diesel across our
construction site by 25% from 5,830
tCO2e in FY22 to 4,358 tCO2e in
FY23, a reduction of 1,472 tCO2e.
• Site gas and electricity: We reduced
our gas use on our sites by 13%, and
reduced electricity use by 5%. This
was achieved in part by reducing the
period between build completion
and handover to home-owner,
resulting in a lower period of energy
consumption.
• Renewable energy: We procured
88% of our electricity from
renewable sources, backed by
Renewable Energy Guarantees of
Origin certificates, and we're still on
track to meet our target of 100%
renewable electricity by 2025.
• Energy efficiency: Solar-powered
site accommodation was
successfully trialled (see the
following page) and a ‘switch off’
campaign helped foster energy-
saving habits across our show home
and sales centres. Further savings
were identified following Energy
Savings Opportunity Scheme audits
across our sites and offices.
• Greener travel: With even more
colleagues opting for an EV car this
year, our EV fleet has increased to
59%, and with more EVs on order,
we're on track to hit our 100% target
by 2025. Our emissions from our car
fleet has reduced by 11.5% in the last
year.
S E E F U R T H E R E N E R GY E F F I C I E N C Y
I N I T I AT I V E S O N PAG E 1 9 6
18%
Reduction in operational energy
consumption in FY23
15%
Reduction in operational
(Scope 1 & 2) emissions in FY23
C
Our Carbon Disclosure
Project (CDP) score
Score for 2023 is not published at
time of publication.
O N - G O I N G CA R BO N E M I SS I O N R E DUC TI O N I N ITI ATI V E S
SCO PE 1 A N D 2
Electric company
car fleet
HVO fuel to reduce
diesel emissions
Renewable electricity
procurement for sites
and offices
Site lighting and heating
improvements with new
modular compound
52
Installation of PV panels
across offices
Diesel emissions reduction
– early connection to the grid
Diesel emissions reduction –
reduce time machinery is idle
Switch to
solar generation
A BETTER WAY TO LIVE
SUSTA I N A B LE S ITE CA B I N S
Our Southern Counties division has been piloting solar/LPG-powered welfare units at its Penlands Green
development. The hybrid system delivers much lower carbon emissions than diesel to generate electrical power,
while also improving air quality and delivering a more pleasant working environment for site employees and
contract staff.
This trial builds on ongoing work to make site cabins more efficient. As with our homes, the cabins now have
improved thermal insulation, double glazed windows, energy efficient LED lights with PIR activation,
thermostatically controlled heaters and energy efficient point-of-use hot water taps.
The Ecologic Solar cabin as
trialled at Penlands Green,
West Sussex.
BENEFITS ON SITE
ADVANTE’S
ECOLOGIC1750
Your health & safety
Your wellbeing
Hot and cold temperature controlled water
24/7 drying room facilities
Mainly silent-running welfare
Pleasant work environment
Intelligent telemetry system with remote
monitoring and reporting for trouble-free
welfare operation
Your carbon footprint
Your industry
Impressive carbon savings with effective
renewable electricity supply
Solar gain achievable all-year-round
Low noise welfare = happy neighbours
Quality welfare improves image of
construction and attracts a diverse workforce
Your air quality
Your welfare costs
NEW hybrid solar and LPG power system
Minimal reliance on generator
Super-low emission, no exhaust particulates
Improved energy performance
Reduced running costs through increased
solar power
95.2%
RE N E WAB
L
E
98.7%
I L ENT
S
ENER G Y
95.2%* electricity
delivered from
solar and stored
energy all year
reducing fuel costs
R
UNN I N
G
Unit runs silently
98.7%* of the
time, enhancing
community and
work environment
P ROVE
D
I M
DU C E D CA
R
B
O
N
E
R
A
I
R
QUA L I T Y
F
O
OTP R I N T
LPG produces
less particulates
than diesel
contributing to
improved air quality
Minimal generator
run time resulting
in substantial
reduction in
carbon footprint
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Car charging pod points are now installed
at our head and regional offices.
Operating review / continued
BUILDING RESPONSIBLY
SCO PE 3 E M I SS I O N S
This year, we have independently
verified our Scope 3 emissions for
FY21 and FY22, with our FY23
emissions being verified by September
2023. This provides us with a robust
baseline to develop our carbon
reduction measures with more
accuracy and efficacy.
As shown below, 50% of our Scope 3
GHG emissions occur post
construction when homes are in use.
This is why we design homes that can
be lived in with reduced energy use
and incorporate eco-smart
technologies such as ASHPs (see
page 44). We engage customers
around energy efficiency through our
Customer Experience Suites and
ongoing communications (see page
275).
‘Embodied carbon’ within building
products and materials and wider
supply chain activities makes up the
second highest proportion of our
Scope 3 footprint. In FY23, we focused
on working with suppliers to co-create
solutions to address this challenge.
S U PPLY C H A I N E M I S S I O N S B R E A K D OW N *
P R O D U C T S
A N D M AT E R I A L S
G R O U N DW O R K S
T H E B U I LD
H O M E S I N U S E
20%
17%
13%
50%
Plastering 7%
Bricks 4%
Plumbing, Heating
and Electric
works 3%
Tiles (Roof, Wall) 2%
Others 4%
* Based on FY21 baseline data
Labour &
Plant 7%
Purchased
Services 7%
Homes 47%
Appliances 3%
Materials 10%
Upstream
transportation
and
distribution
5%
Operations
and travel 1%
C A RB ON R E D U CT IO N
I N I T I A T IV E S
I N O U R
D I R EC T C ON T R O L
S c o pe 3
W E C A N
I N F L U E NC E
C ON T R O L
A N D I N F L U E N C E
Implement Future Homes
Standard (2025)
85% lower emissions
Support our supply
chain with setting own
NZC targets
Establish an EPD database
for our key carbon
contributors
Carbon related clauses
within commercial
contracts
54
Engage with industry
product associations
Improve data
accuracy
Collaborate with Supply Chain
Sustainability School & Future
Homes Hub
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BUILDING RESPONSIBLY
OU R ROUTE M A P TO N ET ZE RO - C A R BO N (2050)
Redrow has responded to the SBTi’s urgent call for corporate climate action by committing to align with 1.5C and
net zero through the Business Ambitions for 1.5C campaign.
The SBTi has approved Redrow's near-term science based emissions reduction target. We have also committed to
set long-term emissions reduction targets with the SBTi by January 2024 in line with reaching net-zero by 2050.
Jul
2023
Progress Scope 1, 2 & 3
reduction inititatives
Jun
2021
Baseline
Year
Near term targets
validated by the SBTi
Roll out of Air Source
Heat Pumps
Set and submit
2050 NZC Target
Jan
2024
Jun
2024
Jun
2022
Supply Chain engagement
Building Regulations:
Part L (2021)
100% Renewable energy
in Redrow Offices and sites
Dec
2024
50% of building
materials to have EPD
Jun
2027
Jun
2028
100% of building
materials to have EPD
Fleet vans -
100% EV
Resubmit near term
targets to SBTi
Jun
2026
On site diesel
phase out
100% of new homes
Eco Electric
100% Eco site
accommodation
70% Supply chain set
1.5 SBTi Targets
Jun
2030
Implementation of Scope
1, 2 & 3 NZC initiatives
Jun
2050
Net Zero Carbon
Sites & Offices
Jun
2025
Future Home
Standard Regulations
UK grid
decarbonisation
Jun
2035
Jun
2037
Further decarbonisation
of products and design
Continuous progress of Scope
1, 2 & 3 reduction initiatives
100% EV Fleet
56
BUSINESS
AMBITION FOR 1.5°C
Key:
Key milestones: Red text
Scope 1 & 2: Purple text
Scope 3: Green text
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BUILDING RESPONSIBLY
RESOURCE EFFICIENCY
Enhance efficiencies and conserve natural
resources through smarter ways of working.
Our programmes to reduce waste,
improve water efficiency, and source
timber responsibly has helped to not
only reduce costs, but also our
upstream and downstream impacts on
the environment.
Working in partnership with our
subcontractors and suppliers is key to
delivering improvements in our
resource efficiency, and we have
focused on supporting our suppliers
along this journey with us. Working
with the wider industry such as the
Future Homes Hub, and ensuring
coordination across our own teams
has also been critical to our success.
Our buildability and waste group
comprising representatives from
across the business has been driving
progress, including publishing a Waste
and Resource Efficiency Policy that
extends to suppliers and developing
an internal strategy, including specific
training.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Transition to a low carbon and more
efficient business and deliver
zero-carbon ready homes.
98%
95% + waste recycled.
A Redrow subcontractor
working on site.
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WA STE A N D
R E CYC LI N G
In FY23, we diverted 98.3% of waste
from landfill. This is a slight decrease
on last year however remains within
our target to achieve at least 95%. Our
waste intensity increased from 7.91
tonnes per 100m2 (t/100m2) to
8.82t/100m2, and as a result we have
set a new target to reduce waste
intensity by 10% by the end of FY25
(2021 baseline year).
We’ve improved data accuracy and
control by streamlining the number of
waste contractors we use. These help
us to maintain a cost-efficient waste
management service, as well as
optimising reporting. In parallel, we’ve
provided additional training and
support to site operatives. Further
steps during the year included:
• trialling more skip compactors to
reduce waste volume and
associated truck journeys, in turn
reducing GHG emissions;
• piloting waste baler technologies,
which reduced skip collections and
subsequently fuel from fewer
journeys;
• releasing a new storage guide for
materials to prevent damage and a
Construction Protection Policy to
further reduce waste; and
• engaging site and office teams
around waste and recycling, with
better waste data information and
signage.
WATE R
M A N AG E M E NT
Although water isn’t currently rated as
a significant material issue for the
majority of Redrow stakeholders (see
page 24), each year risks associated
with water availability and quality
become more acute. These range from
pressures on water conservation and
20, to business continuity
neutrality
risks posed by supply interruptions
and reputational issues arising from
rising home water bills. Extreme heat
and low rainfall in the summer of 2022
saw further impacts on water stressed
areas.
Our homes already have one of the
lowest water use specifications in the
sector – with our Heritage Collection
designed to achieve 105 litres per
person per day (lpppd), against
regulatory standards of 125 lpppd.
We are exploring ways to improve
this further through research and
partnership. For example, we’ve
joined multi-stakeholder forums to
collaborate on water efficiency and
water neutrality solutions including
collaborating with the industry through
the Future Homes Hub. Sustainable
Drainage Systems (SuDS) are
commonplace on our developments,
providing many benefits including
mitigating flood risk, supporting
biodiversity and amenity. Our new
internal SuDS Working Group is
leading our continuing development
of best practice and preparing the
business for anticipated new
mandatory requirements for SuDS
in England.
Meanwhile, just as we engage
customers to save energy and
associated bills (see page 44), we
provide tips and guidance to save
water in the home and garden.
R E A D A B O U T N U T R I E N T
N E U T R A L I T Y O N PAG E 3 7
O U R AWA R D S
E N V I RO N M E NTA L M A N AG E M E NT SYS TE M
AWARD WINNER IN THE
CONSTRUCTION CATEGORY
FOUR STAR
All business operations are covered by an ISO 14001 environmental
management system and each site has an environmental action plan and
is subject to internal and external audit. In the last year, we saw a slight
increase in environmental incidents resulting from surface water run-off. In
response, our pollution prevention controls were strengthened, with
improved site planning and other measures, including working closely
with associated stakeholders.
R E A D M O R E A B O U T H O W W E M I T I G AT E
WAT E R R I S K S F R O M O U R AC T I V I T I E S I N
O U R S A S B D I S C LO S U R E S O N PAG E 2 7 1
BUILDING AND CONSTRUCTION
WASTE MANAGEMENT CATEGORY
INTERNATIONAL CHAMPION OF
CHAMPIONS AWARD AND
GREEN CHAMPION WINNER
58
20 In water-neutral new developments, total water demand is minimised and/or offset by investing in water projects. The key stakeholder is Natural England and the key
59
areas affected for Redrow are Crawley, Horsham, parts of Chichester, South Downs and West Sussex.
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Operating review / continued
BUILDING RESPONSIBLY
SU PPLY C H A I N
SUSTA I N A B I LIT Y
Through our procurement, we create
socio-economic value for local
economies (see page 40). By
embedding sustainability criteria into
our contracts and ongoing
relationships, we can make an even
broader impact, mutually mitigating
ESG risks and unlocking new
commercial opportunities, from
eco-efficiency savings to products
that differentiate us in the market.
Collaborating with suppliers is
therefore not only an important aspect
of reducing value chain emissions, but
is also key to meeting our resource
efficiency targets.
ownership and workplace approaches
throughout our relationship.
For example, as part of our site waste
management strategy our supply chain
attend toolbox talks and awareness
workshops. Through our supplier
appraisal we encourage our suppliers
to reduce the volume of packaging
waste and use packaging that can be
reused or recycled where practicable.
Our Supply Chain Policy makes clear
what we expect of suppliers. From
contract tender, we conduct ESG
appraisals and we continue to engage
on ESG governance, leadership,
As members of the Supply Chain
Sustainability School, our suppliers
have access to thousands of online
presentations, training modules,
guidance documents and checklists.
They can also attend free expert-led
workshops and briefings. In FY23,
these included a series on carbon
awareness, attended by Redrow
suppliers from diverse sectors.
Attendees developed skills in carbon
measurement, disclosure, strategy and
Environmental Product Declaration
(EPD) requirements.
We could not have achieved
the growth we are experiencing
without Redrow delivering on their
value of working in partnership
with suppliers.
Paul Brownhill
Operations Director, Exallot
63%
Of suppliers attending our workshops
had (or were in the process of
establishing) a carbon reduction
strategy
R E A D A B O U T E C O N O M I C VA LU E
C R E AT I O N I N O U R S U P P LY C H A I N
O N PAG E 4 0
A supplier visit taking place at Vaillant’s
factory. A supplier of Air Source Heat Pumps.
60
A BETTER WAY TO LIVE
R E S P O N S I B LY- SOU RC E D TI M B E R
As laid out in our Sustainable Timber Procurement Policy and enhancing our contribution to SDG 15 (Life on land),
we work with suppliers to ensure that timber comes from responsibly managed forests. During the year, 99.9% of
timber sourced was certified to Forestry Stewardship Council (FSC) or Programme for the Endorsement of Forest
Certification (PEFC) standards. We’ve also increased our CDP Forests rating from C to B-. See the full disclosure at
cdp.net.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Transition to a low carbon and more
efficient business and deliver
zero-carbon ready homes.
99.92%
100% timber FSC or PEFC
certified
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B-
Our CDP Forest score
Score for 2023 is not published at
time of publication.
Bronze
For sustainable supply chain,
Global Good awards 2022
99.92% of our timber was
FSC or PEFC certified.
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BUILDING RESPONSIBLY
SAFE BY DESIGN AND
OPERATING RESPONSIBLY
Integrating health, safety and environment
into everything we do.
Upholding the safety and wellbeing of
our customers, employees and
contract staff remains among the top
two most material issues for our
stakeholders (alongside climate
change) and is key to how we manage
risk and protect business continuity
and our reputation.
ensuring considerate and responsible
conduct in our operations.
Our HS&E Policy and Strategy
emphasises safety in the design, build
and use of our homes, as well as
S E E O U R E S G H U B O N PAG E 2 5 2
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Integrate health, safety and
environment into everything we do. 365
(0% reduction)
10% year on year reduction in
Annual Injury Incidence Rate.
developed in the past 30 years. Find
out more on our website.
Last year we introduced our internal
HS&E Awards Scheme to promote and
encourage continuous improvement of
our HS&E performance across our
construction sites. This is a 3-tier
scheme where all sites are judged to
determine a HS&E Division Winner,
each HS&E Divisional Winner is then
put forward and judged to determine 3
HS&E Regional Winners. The 3 HS&E
Tim Stone, Regional Chief Executive (right)
with Joshua Cullen, Site Manager (left) at
Woodcote Park, Herne Bay, Kent.
Regional Winners are then judged to
determine the Overall Group HS&E
Winner. We are pleased to announce
that Overall Group HS&E Winner was
our South East, Woodcote Park
development.
The Site Management Team
demonstrated consistent HS&E
performance over the last Financial
Year and worked hard to plan.
manage, monitor and co-ordinate
activities on site helping to ensure
those activities are Safe by Design
and the site is Operating Responsibly.
R E DUC I N G
ACC I D E NTS A N D
I N C I D E NTS
We achieved a 22% reduction in minor
injuries and a 30% reduction in
significant incidents21.
For any incident or accident that
occurs, we ensure that lessons are
learned and improvements are made
to how we plan, manage and monitor
activities. New or enhanced operating
and management procedures have
assisted in this, e.g. we now have a
much clearer procedure around
personal protective equipment and
unannounced drug and alcohol
testing. We’ve also improved induction
processes for new supervisors and
plant operators.
We’ve signed the UK Government's
pledge and the Welsh Government's
pact regarding the remediation of life
critical fire safety issues in buildings
over a height of 11m that we have
62
21
RIDDOR: Reporting of Injuries, Diseases and
Dangerous Occurrences Regulations.
A BETTER WAY TO LIVE
2023 FOCUS A R E A S
The graphic below sets out our HS&E strategic level processes, describing our overall approach to managing HS&E
across the business.
Governance
what everyone can do to support good safety
governance.
Leadership
what we mean by leadership, who it applies to and
how all employees can lead by example.
Ownership
asking everyone if they know what their individual
HS&E responsibilities are and ensuring they have
completed and maintained any mandatory training.
Workplaces
everyone has a responsibility to ensure
workplaces are clean, secure, healthy, safe and
have a minimal impact on the environment.
A Group-wide stand-down and toolbox talk was
delivered to all employees and contractors to
support Workers’ Memorial Day on 28 April.
Every quarter, we raise internal awareness around a strategic safety theme, with tips and guidance on site
noticeboards, intranet updates, toolbox talks and special events.
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BUILDING RESPONSIBLY
CO N S I D E R ATE CO N STRUC TI O N
A key aspect of building responsibly is ensuring that we manage our developments – and the build
process – in ways that build positive relationships with the local community and respect the
environment. As members of the CCS since 2018, we undergo regular audits against the Code of
Considerate Practice. In FY23, CCS scored our sites an average of 39.5 out of 45, significantly
exceeding our target 22. CCS scores became part of the bonus scheme for our construction teams in the
last year, further incentivising considerate practices.
A BETTER WAY TO LIVE
CC S: I N C R E A S I N G SCO R E S Y E A R - O N -Y E A R
For the last five years’ running, we’ve increased our scores under the CCS
Code of Considerate Practice. Each Redrow development site is monitored
twice a year (or the equivalent registration period) for potential improvements
or non-compliances with regard to:
• respecting the community;
• caring for the environment; and
• valuing the workforce.
With 15 points available for each of these three priorities, many of our sites
have scored the full 45 points since 2018, with our Woodford Garden Village
and Saxon Brook sites achieving top marks following the new CCS scoring
system in 2022 and this included three consecutive scores of 45/45.
45
CCS points scored for Saxon
Brook out of a possible 45
Full marks for Saxon Brook
A large multiphase development near Exeter, Saxon Book has
been recognised by CCS for its considerate construction
practices across the board:
Respect the community: The public will rarely encounter any site
traffic and the approach road remains clean and tidy. Noise and
dust are kept to a minimum, with a road sweeper deployed twice
weekly. A toolbox talk was given specifically on avoiding nuisance
around occupied properties and a communication hub is in place.
The site has hosted school and college visits for students to learn
more about construction and career opportunities. Local
subcontractors are employed where possible and there are
currently four apprentices working on site.
Care for the environment: The site commits to carbon reduction,
in line with Redrow 2025 objectives. It features a solar-assisted
hybrid satellite office and welfare facility, with mains electricity
provided under a green tariff and EV charging points available. All
resource use (electricity/water/diesel) is measured and monitored.
A comprehensive environmental plan and public open space
planting plan incorporates a bee trail. Suppliers are assessed and
selected in accordance with net zero commitments.
Value their workforce: Right to work and workforce competency
checks are made. Workforce training includes ED&I and possible
indicators of modern slavery, while a My Life helpline is available
to employees and subcontractors. Health and wellbeing
champions and mental health first aiders are available. Workers
can join a cycle to work scheme.
64
22 Due to CCS total scores changing from 50 to 45 in FY23, we’ve not included comparison to FY22 data.
Bumblebee Trail at Saxon Brook,
Pinhoe, Exeter.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Integrate health, safety and
environment into everything we do.
100%
39.5
100% sites registered to the
Considerate Constructors
Scheme.
Average CCS score at least
33/45.
B U I L D I N G R E S P O N S I B LY – W H AT ’ S N E X T ?
As we work towards our 2024 targets, we will address
quality performance with regard to home defects as a
matter of priority, while incorporating NHBC’s Quality
Common Scoring (QCS) system.
On our net zero GHG journey, we will publish a SBTi
approved long-term target and accelerate value chain
engagement, with a focus on suppliers. We will also use
the Transition Plan Taskforce disclosure framework to
ensure our route map achieves best practice. To amplify
resource efficiency efforts, we hope to roll out more
baler technologies and move towards EPD-evidenced
procurement.
On safety, we will continue to enhance the Red HSE app
to include more safety incident management tools and
support our colleagues to drive down incidents.
S E E O U R E S G H U B O N PAG E 2 5 4
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
2 02 4 TA R G E T S
10% year on year reduction in Annual Injury
Incidence Rate
100% sites registers to the Considerate
Constructors Scheme
Average CCS score at least 35/45
Net Promoter score of 54%
Customer Satisfaction rating
(recommend a friend) 91%
Average Trustpilot Score 4.3
0.25 or less reportable items per NHBC inspection
(RIs and BRIs combined)
NHBC CQR Group Average Score of 86% or more
NHBC CQR Average Score per inspection of
4.5/6 or more
95%+ waste recycled
100% timber FSC or PEFC certified
100% renewable energy used in offices and
sites by end of 2024
Top 70% of the Supply Chain (based on spend)
to be using the Supply Chain Sustainability School
by the end of 2024
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Strategic report
Operating review / continued
VALUING PEOPLE
Workplaces where people
can be themselves and
fulfil their potential
With the future pipeline of
talent always in mind, we’ve
undertaken more outreach
to schools, inspiring and
supporting youngsters in
areas of low social mobility.
At the same time, we’ve
invested in our existing
workforce to attract and
retain the talent we need.
Karen Jones
Group Human Resources
(HR) Director
H I G H LI G H T S
2.5
Days of training per employee,
on average
84%
Employee engagement score
92%
Of colleagues clear on role in
supporting ED&I
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I n light of national skills shortages during the
last year, our role as an employer and
trainer has become even more important.
We’ve invested further in apprenticeships,
work placements, graduate programmes and university
partnerships. Looking to the future pipeline of talent,
we’ve also enhanced our school outreach, with
learning resources and Redrow Ambassadors
supporting pupils in regions of low social mobility.
For those working at Redrow now, we’ve further
strengthened our learning and development offer, with
2.5 days of training per employee on average. A key
focus remains on empowering women, who are
significantly underrepresented in our sector, to grow
with us and become leaders and role models for girls
and young women. Agile and flexible working
arrangements continue to be supported for a healthy
work-life balance and we’ve expanded physical and
mental health support services and resources for
colleagues and partners.
Valuing people extends to those working in our supply
chains and the vulnerable in our communities. Our
Supply Chain Policy makes clear our position with
regard to treating people with respect and dignity,
reinforced in our statements on Human Rights and
Modern Slavery & Human Trafficking. Alongside
charitable donations and development-level
community funds, we incentivise employees with two
days paid volunteering leave each year.
By valuing people, we contribute to wider sustainable
development, notably SDGs 5 (Gender equality) and 8
(Decent work and economic growth) – find out more on
page 268.
O U R AWA R D S
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M AT E R I A L I S S U E S
• Company culture
• Diversity and
• Sustainable
procurement
inclusion
• Skills and training
C O N T R I B U T I O N TO S D G S
TOP 100
APPRENTICESHIP
EMPLOYER
Gold
2022/23
LIVING WAGE
EMPLOYER
GOLD ACCREDITED
MEMBER OF 5%
CLUB
20 NHBC PRIDE IN
THE JOB AWARDS
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Apprentices at
Stephenson College.
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We are proud to be the highest
placed homebuilder in the top
100 Apprenticeship Employers,
ranked at number 64.
Strategic report
Operating review / continued
VALUING PEOPLE
STRATEGY SPOTLIGHT
CLOSING THE
CONSTRUCTION
SKILLS GAP
The last year has been characterised by a well-publicised
nationwide skills shortage. With our research showing that nearly
half of young adults say they’re open to working in construction 23,
we’re investing to close the skills gap – from schools outreach, to
acclaimed apprenticeships.
At 2 July 2023, 15.9% of employees at Redrow were trainees including graduates and
apprentices, achieving our target of 15%.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Inspire the next generation into the
sector and ensure people have the
opportunity to develop and grow
within the business
15.9%
15% of all employees being
trainees
S E E O U R E S G H U B O N PAG E 2 5 6
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
A PPR E NTI C E S H I P S
Our national apprenticeship
programme continued to support 153
trade apprentices and 28 technical or
commercial apprentices on their
programmes. We also welcomed 109
newcomers to our programmes. Our
brickwork hub in partnership with
NHBC at our Amington Garden Village
development in Tamworth has become
a beacon for how we provide expert-
led, real-world experience for
apprentices. Cohorts of 20
apprentices spend six-week blocks
working in a proper site environment
with full health and safety protocols
ensuring they are site-ready for when
they start work.
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23 Based on our survey of 1,000 young adults aged 16-24.
This intensive apprenticeship
programme is proving to be the
right choice to help individuals
looking to enter this area of
construction, as well as addressing
the skills shortage the industry
currently faces.
Clare Hindley
Head of Training
APPRENTICE
SPOTLIGHT
The Redrow team have been incredibly
welcoming and made me feel right at home.
As a generally male-dominated industry,
I was nervous about entering the world
of construction. However, Redrow have
been really supportive and encouraging.
I’m thoroughly enjoying my experience and
want to keep doing this job at Redrow until
I retire!
Jasmine Dyer (18)
Carpentry Apprentice
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Bricklaying apprentices at the NHBC
Training Centre, Tamworth.
Operating review / continued
VALUING PEOPLE
U N I V E RS IT Y
PA RTN E RS H I P S
In FY23, 19 graduates completed our
two-year development programme
that nurtures candidates from all
degree backgrounds to become future
leaders in housebuilding. We’re
looking forward to welcoming 13 more
graduates in FY24.
Our sponsored degree programme
with Coleg Cambria in Wrexham and
Liverpool John Moores University has
enabled 13 young people to graduate
with BSc (Hons) in construction
management and housebuilding.
Seven of these achieved first-class
honours. The programme combines
on-the-job learning with fully funded
university studies. In FY23, we saw an
intake of 15 and there are currently 31
students rotating through Redrow’s
construction, commercial, technical,
land and planning, customer service
and sales departments.
Taking forward the university
partnership model, we’ve now signed
a three-year partnership with
Nottingham Trent University to support
widening access to university, giving
students the opportunity to access a
range of extracurricular activities that
are strongly correlated with improved
student outcomes. We will report back
further in FY24.
SC H OO L S A N D
CO LLE G E OUTR E AC H
Always looking to the next generation
of talent, our work experience
programme gives 15 to 18-year-olds a
chance to experience careers in
housebuilding. We partner with the
School Outreach Company to ensure
we reach regions of low social
mobility, with Redrow Ambassadors
inspiring pupils in diverse career
pathways and providing support
around CV-writing and interviewing.
The partnership currently extends to
around 250 schools.
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Apprenticeships in bricklaying
and site supervision are fantastic
pathways into a rewarding
and well-paid career in the
housebuilding industry and
we’re delighted to see the first
apprentices to achieve fully
qualified status through the hub.
Geoff Mann
Qualifications Manager, NHBC
For anyone considering a Redrow
sponsored degree programme, I
would say go for it! It’s not often
the chance comes around to work
for such a reputable company,
gaining valuable experience
to progress in your career,
surrounded by colleagues with
years of experience to learn from,
while also gaining an extremely
well-regarded qualification.
Beth Salisbury
Quantity Surveyor, successful sponsored degree graduate
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NHBC training course at Amington
Garden Village, Tamworth.
Operating review / continued
VALUING PEOPLE
EQUALITY, DIVERSITY
AND INCLUSION
Creating a diverse and inclusive workplace that
prioritises the wellbeing of our people.
Equality, diversity and inclusion (ED&I)
in our workforce benefits Redrow by
enhancing creativity, innovation,
productivity and connection to
customers. Our expectations are
outlined in our policies on ED&I and
recruitment and selection. Every
division has its own ED&I senior
sponsor and lead representative, with
more than 85 ED&I representatives
driving progress internally.
92%
Of colleagues are clear about
their role in supporting ED&I
S E E O U R E S G H U B O N PAG E 2 5 8
O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
R E A D M O R E A B O U T M A N AG E M E N T
A N D B OA R D D I V E R S I T Y O N PAG E 1 5 9
R E A D M O R E A B O U T O U R E D & I
P O L I C Y O N PAG E 1 9 4
It has been refreshing to work at a
company that takes ED&I seriously.
Working as a lead rep for the South
East division and understanding
and witnessing the impact that
we make on the business has
been extremely fulfilling. The ED&I
Team at Head Office have been
fantastic and their organisation
and dedication to the cause and
willingness to help is inspirational.
Georges Mikhael
Lead ED&I Rep for South East division
I N C LUS I V E
CU LTU R E
Delivering on our targets requires
every Redrow employee to engage
with and champion diversity issues. As
well as supporting employee-led
initiatives and networks, we welcome
open discussion, with a dedicated
ED&I intranet page. A key
development in FY23 was handing
over decision-making around which
national/global events or campaigns to
celebrate to regional ED&I
representatives. As a result, we
marked the following: Neurodiversity
Week, Black History Month,
International Women’s Day, Easter,
Chinese New Year, Ramadan and Eid
and Pride Month. We also encouraged
employee blogging and intranet posts
around religious festivals.
As part of our memberships of
diversity organisations, we hosted
events to build skills and awareness
on key topics. For example, the
Business Disability Forum ran
webinars on dyslexia and autism for us
during Neurodiversity Week.
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Graduate Induction course at
Redrow Training Centre, Tamworth.
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VALUING PEOPLE
A BETTER WAY TO LIVE
WO M E N I N CO N STRUC TI O N
The UK construction workforce comprises just 16%
women and our research shows that three in five
young women want to work for a company that has
more female leaders. Bridging the gap between
aspiration and reality requires a joined-up effort from
companies like Redrow to work with schools, colleges,
universities and policy makers. We continue to
proactively target female talent through diverse
university and graduate recruitment strategies. We
also partner with HBF and Women into Construction
on recruitment and development initiatives.
Against our 2025 ESG targets24 for 40% of women
recruited into graduate roles and 28% women in senior
management by 2025, in FY23 we achieved 33.3% and
25.3% respectively.
E S G TA R G E T S A N D P R O G R E S S
F O R W O M E N I N C O N S T R U C T I O N
33.3%
6 .7 %
4 0 % TA R G E T W O M E N I N G R A D U AT E R O L E S B Y 2 0 2 5
Achieved
2025 Target
25.3%
2 .7 %
2 8 % TA R G E T W O M E N I N S E N I O R M A N A G E M E N T B Y 2 0 2 5
Achieved
2025 Target
For women working at Redrow, our six-month STAR
programme provides opportunities to develop
leadership skills, while the Redrow Women’s Network,
(relaunched as the Empower community), remains a
popular forum for women to connect, share and grow
– from trainee to senior executive level. The network
offers peer-to-peer mentoring on a range of
challenges faced by women in the workforce.
We’re pleased to report that we reduced our gender
pay gap further in the last year, from 5.9% to 3.5%
(mean hourly average).
F I N D O U T M O R E A B O U T H O W W E ’ R E
I N S P I R I N G T H E N E X T G E N E R AT I O N
O F W O M E N I N TO C O N S T R U C T I O N AT
W W W.W O M E N - I N TO - C O N S T R U C T I O N .O R G
The launch of Empower on
International Women’s Day has
introduced a platform to Redrow for
women to connect, network and share
knowledge/experience both work-
related and non-work-related and offer
support or advice for each other, with
all colleagues able to join, support
each other and become allies.
Amanda Hollins
Chair of Empower
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24 Operational framework targets are currently in development with guidance from external experts. Meanwhile, we report against ESG scorecard metrics.
Z A R A’ S S TO RY
Zara Barrow joined Redrow ten years ago as an assistant
site manager. She’s now Redrow’s Group Construction
Director and Group sponsor for ED&I, inspiring the next
generation of women into the industry.
I think that girls of school age
need to understand that a career
in construction is a possibility. The
perception of it being just for men
is out of date. There are so many
opportunities for women to succeed,
do well and make a difference to
communities.
Zara Barrow
Group Construction Director
E V E ’ S S TO RY
Eve joined Redrow’s two-year graduate training
programme in September 2021. She was promoted
after just 18 months in our Yorkshire division to the
role of assistant designer.
I believe it is instrumental to ensure
girls and women who may not have
considered working in construction
see it as the supportive environment it
can be, and those who have embarked
on their career, feel championed to
stay long-term.
Eve Walton
Assistant Designer
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VALUING PEOPLE
ENGAGING PEOPLE
AND PARTNERS
Empowering and engaging our people and
partners to deliver on our purpose.
Valuing our people and partners is critical to ensuring our relationships flourish.
We have a dedicated Non-Executive Director heading up our workforce
engagement group.
LE A R N I N G A N D D E V E LO PM E NT
S E E O U R E S G H U B O N PAG E 2 5 6
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
In FY23, we delivered 5,591 days of training, the equivalent to 2.5 days per
employee and a slight increase on the previous year. Alongside apprenticeships
and other vocational training (see page 40), just over 15% of Redrow’s workforce
held trainee status at 2 July 2023.
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Empower and engage our people
and partners to deliver on our
purpose.
2.5
3 training days per employee per
year.
TOTA L T R A I N E E S
2023
Apprentices
Graduates
Other
Total Trainees
200
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349
TOTA L E M P LOY E E S
2 ,1 89
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Redrow employees undergoing construction training at
our purpose built training centre.
A BETTER WAY TO LIVE
G ET TI N G M O R E F RO M
G I V I N G BAC K
In FY23, our second-year graduates were once
again out and about adding value to deserving
causes. The two charity partners supported were
Hope House Children’s Hospice and The
Children’s Adventure Farm Trust.
We were able to use the knowledge
we’ve gained during our graduate
training programme over the last 18
months and complete everything
on time; it also helped expand our
practical skills.
Ruben Codinha
Graduate trainee
Just as charities benefit from volunteer time,
graduates develop their skills, practice team-
building and connect with diverse communities.
It’s been a real team effort by the
graduates and three days of hard
work onsite at CAFT and Hope House
Hospice. They’ve utilised skills in
problem-solving, procurement and
negotiation, all of which are key
elements of their graduate training
programme.
Beth Toomey
Graduate programme manager
R E A D A B O U T O U R C H A R I TA B L E
D O N AT I O N S P O L I C Y O N PAG E 1 9 4
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VALUING PEOPLE
A BETTER WAY TO LIVE
PR I D E I N TH E JO B AWA R D
W I N N E RS
The National House Building Council (NHBC)
celebrates the very best UK site managers and their
commitment to raising standards in house building.
With only 444 winners selected out of over 8,000
entrants across the UK, the recipients are among the
country’s best house builders.
The Quality Award winners will now go on to compete
for Seal of Excellence and Regional Awards in the
autumn, with the national Supreme Award winners
unveiled in January 2024.
In the last year, our people picked up 20 NHBC Pride
in the Job awards, including joining the ‘supreme’
category for the first time.
C O N G R AT U L AT I O N S TO O U R AWA R D W I N N E R S
• James Barraclough
• Elliot Kingdon
• Michael Burnell
• Ian Larkins
• Peter Campbell-Wright
• Jack Leslie
• Matthew Coyle
• Ian Day
• Keith Mitchell
• Paul Peacock
• Ben Goostrey
• Edward Piggford
• Cait Grady
• Jake Green
• Adrian Stone
• Huw Thomas
• Prageeth Harischandra
• Craig Thomas
• Jason Hart
• Luke Woodall
It is important we recognise the vital
role site managers play in ensuring
new homes are delivered on time, on
safe sites and to exacting construction
quality standards.
This accolade recognises the best
site managers across the UK and
celebrates how much all the winners
have inspired their teams by going
the extra mile to deliver homes of the
highest quality.
Steve Wood
CEO, NHBC
Left to Right: Edward Piggford, Elliot
Kingdon, Craig Thomas, Matthew Coyle,
Adrian Stone and Huw Thomas.
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CO LLE AG U E S P OTLI G HT: PR I D E I N TH E J O B AWA R D W I N N E R S
I am delighted to win this award for
the second time. It is testament to
my team’s hard work, dedication and
consistency that we have won it two
years in a row.
Jake Green
Site Manager
Tabley Park, Knutsford
Moving to site was absolutely the best
decision I made, and I wish I had made
the jump into construction a lot earlier.
Cait Grady
Site Manager
King's Moat Garden Village, Chester
This is the second year in a row that Jake Green, a father of
two from Oldham, has received this award.
Jake, 28, has worked for Redrow for the past six years, after
starting our graduate scheme in 2017. It was obvious from
the start that the father-of-two was heading for success
when he was taken off what should have been a two-year
training programme and fast tracked to a promotion after
just 11 months.
Cait Grady, 34, has worked for Redrow for the past 10 years,
initially joining as a member of the customer and marketing
team.
Realising her passion lay in construction Cait completed a
masters in construction management and switched roles to
a project coordinator, before becoming an assistant site
manager and then site manager at Redrow’s Chester
development – King’s Moat Garden Village.
He was given the role of assistant site manager at 23 and
his own site to run at Mulberry Park in Macclesfield. From
there he went to Cranberry Gardens in Congleton before
being made site manager at Tabley Park in Knutsford, where
he’s worked for the past three years.
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NHBC Pride in the Job awards
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VALUING PEOPLE
S T R AT E G I C O B J E C T I V E
2 02 3 P E R F O R M A N C E
2 02 3 TA R G E T
Maintain overall engagement taken
from annual survey report produced
by Employee Feedback Ltd.
84%
Continue to achieve an
engagement score of 80% or
above.
LI STE N I N G A N D
R E S P O N D I N G
We saw an exceptional response to
our employee survey (92% versus
88%), with an overall engagement
score of 84% (compared to 83% in
FY22).
Engaging and developing our people
has helped enable 235 internal
promotions during the year (FY22:
261). A proportion of our employees
voluntarily leave or retire each year,
resulting in a turnover rate of 15.2%, a
significant reduction on FY22 (19.4%).
Another indicator of engagement is
traffic to our intranet page ‘Engage’.
During the year, there were an
additional 44,476 views compared to
the previous year, with more blogs,
articles and other employee-led
content shared than ever before.
We foster a ‘speak out’ culture at
Redrow, whereby employees are
empowered to raise concerns without
fear of discrimination or retribution. An
independent hotline is available for
colleagues to anonymously report
unethical or unsafe behaviours or
possible breaches of the Policy on
Bribery and Corruption or malpractice.
This is made clear in our
Whistleblowing Policy. We have an
anonymous email facility for
employees to raise any concerns
relating to ED&I.
and workplace. Highlights in FY23
included introducing health kiosks for
employees and contract staff to
access a health MOT, with results and
support shown instantly via a
dedicated app. We also ran a ‘save a
life’ course with the British Red Cross,
as well as webinars with the British
Heart Foundation and internal
wellbeing events, such as ‘yoga at
your desk’. Internal health awareness
campaigns spanned topics from
menopause and diabetes to stress
awareness and supporting carers.
A WO R K PL AC E FO R
W E LLB E I N G
Alongside prioritising the safety of
those working at or with Redrow (see
page 62), we also nurture physical and
mental wellbeing through our culture
92%
response rate
to the survey
are proud to work
for Redrow
would recommend Redrow
as a good place to work
feel supported by
their manager
of new starters say their
induction gave them the
information they needed
think communication is good
between your team and other
teams you work with
believe Redrow lives up
to ‘valuing people’
think that Directors have
communicated a clear company
vision for the next few years
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A BETTER WAY TO LIVE
M I N D YOU R H E A D
Our ongoing mental health campaign, Mind Your Head,
reached more employees and subcontractors with
toolbox talks, ‘lunch and learns’ and other resources.
During Mental Health Awareness Week, the campaign
focused on the role of our Mental Health First Aiders
(we currently have 150 people trained) and the Redrow
Employee Assistance Programme.
Our ED&I reps, wellbeing champions and MHFAs are
now supported further by monthly development
sessions, as well as a dedicated hub and newsletter
for them to expand their knowledge and confidence.
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We have great communication
within the business and from all
departments, with updates of
the whole business on Engage,
regular meetings and internal
emails.
Redrow employee
Annual survey
Redrow is a fantastic company
to work for, I love our ethos
and the people I work with. I
am really proud of what we do
at Redrow and proud of the
experience we deliver to our
customers.
Redrow employee
Annual survey
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Strategic reportStrategic reportEMPLOYEE SURVEY HIGHLIGHTS* 89%86%85%83%84%95%90%*Last year our results were as follows: • 89% feel supported by their manager; • 81% of new starters say their induction gave them the information they need.
Operating review / continued
VALUING PEOPLE
Redrow’s Senior Management team visit the Vaillant
factory, a supplier of Air Source Heat Pumps.
SU PPLI E R
PA RTN E RS H I P S
Beyond our operations, we work
closely with supplier partners, not only
on environmental sustainability (see
page 60), but also on wider social
impact. A close relationship is also
fundamental to ensuring we deliver
high quality homes on time. This was
never clearer than in FY23 when the
availability and costs of construction
materials became a headline issue for
our industry. We’re pleased with the
resilient position we maintained,
thanks to our unique and established
product range and our detailed,
controlled forecast plot process, which
supports procurement planning for
both parties.
Our supply chain contracts make a
significant contribution to socio-
economic value (see page 40). We
have supply agreements with around
250 suppliers nationally, covering
approximately 85% of our total output.
A large number of our relationships
extend beyond ten years and some
are in excess of 20 years. This is
testimony to the value we and our
supply partners place on having a
relationship based on shared values.
We try to procure labour and materials
within a 50-mile radius of each
divisional office to support the local
communities we work in. Where we
have an agreement with a national
supplier, we identify local depots to
cut down on distribution costs and
reduce carbon emissions, and support
the local economy.
Finally, we uphold human rights in the
supply chain, requesting that suppliers
actively confirm compliance with
Modern Slavery legislation and the
Redrow Code of Conduct (suppliers
and manufacturers). See the Directors’
Report for more information.
CO M M U N IT Y
CO LL A BO R ATI O N
As part of how we create a positive
impact in our communities (see page
38), we encourage employees to give
their time and assistance to charity
partners in their neighbourhoods with
a Volunteering Policy that gives every
employee two days’ volunteering
leave each year.
1,495
Subcontractor companies supported
2,708
Suppliers supported
747
Days of employee volunteering
S E E O U R E S G H U B O N PAG E 2 6 4
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
Redrow’s in-house interior design team, pictured
below with colleagues from the Hospice of the
Good Shepherd, Chester, transformed a former
storage room into a relaxing new ‘spa like’ waiting
lounge space.
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H E AT PU M P PA RTN E RS H I P S
Key to the success of introducing ASHPs into our homes is how we engage with our supply chain. We’ve spent the
last few years preparing the business for the transition from gas boilers by conducting trials with manufacturers
and working through our vision with suppliers. Together, we have been able to educate, train and engage our
construction, technical, sales and customer service teams through a range of events including online training,
factory tours, webinars and internal campaigns.
We’re also supporting our sub-contractors to deliver this. We brought the supply chain together through a series of
joint webinars. We have also supported the extensive direct training that manufacturers have in place. As a result,
our sub-contractors have been able to prepare and educate their teams in new working practices. Adopting this
approach means that we can smooth out and learn from issues quickly, helping us deliver best practice across the
business, improving quality for our customers.
VA LU I N G P E O P L E – W H AT ’ S N E X T ?
With skills availability likely to remain an ongoing
challenge for our sector, Matthew Pratt is chairing an
expert skills panel with the HBF to identify sector-wide
solutions.
Meanwhile, a new skills partnership with Nottingham
Trent University will offer more industrial placements,
graduate opportunities and financial support for
students to access homebuilding careers.
Within Redrow, we will improve performance reviews
and scale ED&I activities, with a focus on gender
rebalancing within our business and sector.
S E E O U R E S G H U B O N PAG E 2 5 6
F O R M O R E I N F O R M AT I O N O N O U R
P E R F O R M A N C E A N D TA R G E T S
C O N T I N U E TO W O R K TO WA R D S 2 0 2 5
E D & I TA R G E T S S E E PAG E 2 6 9
2 02 4 TA R G E T S
15% of all employees being
trainees
3
training days per employee
per year
80%+
Maintain overall engagement
taken from annual salary
survey report produced by
Employee Feedback Ltd.
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Strategic reportStrategic report
Financial review
FINANCIAL REVIEW
C U S TO M E R P R O F I L E C H A R T
This year the Group has
delivered a strong financial
performance given market
conditions.
U N D E R LY I N G P E R F O R M A N C E
This year the Group has delivered a
strong financial performance given
market conditions. We generated
operating profit of £399m (2022:
underlying £414m1) and a return on
capital employed of 23.11% (2022:
24.54%). We successfully completed
the share buyback we launched in July
2022, returning £100m cash to
shareholders and ended the year with
net cash excluding lease liabilities of
£235m (2022: £288m). FY23 was a 52
week year compared to FY22 which
was a 53 week year.
R E V E N U E , LE G A L C O M P LE T I O N S
A N D O U T L E T S
Total Group revenue was £2.1bn (2022:
£2.1bn). Homes revenue was broadly
maintained at £2.1bn (2022: £2.1bn)
from the completion of 5,436 new
homes, a 5% reduction on the prior
year (2022: 5,715). The average selling
price of our private home completions
increased by 8% and that of our
affordable homes by 5% on those in
2022 due to house price inflation and
product mix. Other revenue from land
sales was higher than in the prior year
at £44m due to two significant land
sales on larger sites (2022: £21m).
Homes Revenue grew in our North and
Central regions and reduced in the
South and Colindale. The Central
84
Barbara Richmond
Group Finance Director
region achieved sales growth of 15%
and benefitted from both improved
product availability due to an increase
in outlets and an improvement in
geographical and product mix.
Revenue in the South reduced by just
under 8% due to lower volumes and a
change in mix, with a greater
proportion of private apartment
completions and affordable homes.
As a result, Homes Revenue for the
ongoing business was £2,038m, 1%
lower than the prior year (£2,067m)
from 5% fewer legal completions.
Revenue from private houses
decreased by 2% to £1.6bn (2022:
£1.7bn) on 11% lower volumes whilst
revenue from private apartments
decreased by 22% to £181m (2022:
£232m) on 14% lower volumes. This
was a result of completing the run
down of our London business
(excluding Colindale) and higher sales
of apartments in the South East
outside London which are of a lower
average selling price than those in
London.
H O M E S R E V E N U E BY G E O G R A P H Y
2023
2022
North
Central
South
Colindale
£493m
£628m
£819m
£98m
North
Central
South
Colindale
£458m
£547m
£889m
£173m
Total Homes Ongoing
£2,038m
Total Homes Ongoing
£2,067m
Build Out (London)
£45m
Build Out (London)
£52m
2023
Other Private
HTB
Investors
Affordable
2022
Other Private
HTB
Investors
Affordable
64%
4%
5%
27%
62%
10%
6%
22%
Our Heritage Collection contributed
90% of private revenue in the year up
from 88% last year. The average
selling price of our Heritage homes
increased by 9% to £473,300 (2022:
£433,300). This continues to reflect
the strategic shift towards quality
family detached homes in primary
regional locations, focusing on the
home mover segment.
Affordable revenue increased 25% to
£258m (2022: £207m) due to the
timing of legal completions. It
represented 12% of Homes Revenue
(2022: 10%). In terms of volumes,
affordable homes represented 27% of
the 5,436 legal completions we
delivered in FY23 (2022: 22% of 5,715).
Average active outlets increased to 117
(2022: 111) which was 3 below the
guidance we issued, primarily due to
planning delays. Our guidance for the
2024 financial year is for average
active outlets to remain at 117 due to
continuing delays in the planning
system and a slower sales market.
R E S E R VAT I O N S A N D O R D E R B O O K
The Group secured £1.3bn of net
private reservations in the 52 weeks to
2 July 2023 compared to £1.82bn for
the 53 weeks in the previous year. We
ended the financial year with a private
order book of £0.6bn (2022: £1.1bn)
and a total order book of £0.9bn,
compared to £1.4bn last year. The
reduction in reservations started with
the negative impact of the
Government’s mini-Budget at the end
of September 2022 which caused a
spike in interest rates and not only a
reduction in new reservations but also
a very high number of cancellations.
Whilst the housing market did pick up
in the 2023 calendar year it did not
return to normal levels of activity, with
the sales rate averaging 0.53 per
outlet per week for the second half of
the financial year (2022: 0.71). This is
due to the increases in mortgage
rates. The sales rate reduced again in
June as further mortgage rate rises
were introduced by the major lenders.
P R O F I TA B I L I T Y
Gross profit was £508m, a £8m
reduction on the prior year (2022:
underlying £516m1). This represents a
gross margin of 23.9% (2022: 24.1%1).
The 20 basis point reduction in margin
reflects build cost inflation which was
not fully offset by house price inflation
and also a higher proportion of
affordable housing revenue due to the
timing of legal completions.
Administrative expenses increased by
£7m to £109m (2022: £102m) due
mainly to cost inflation and ongoing IT
investment. Administrative expenses
were 5.1% of revenue, an increase on
the previous year levels (2022: 4.8%).
The Group therefore delivered an
operating profit of £399m (2022:
underlying £414m1) in the year at an
operating margin of 18.76% (2022:
19.3%1).
Net financing costs at £4m were in line
with the prior year with bank interest
payable and receivable increasing
reflecting increases in base rate. We
had an average monthly net cash
balance of £196m for the year
compared to £250m the previous year.
As a result, the Group delivered a
profit before tax of £395m (2022:
underlying £410m1) for the year with
basic earnings per share of 91.2p
(2022: underlying 96.0p1).
Last year an additional £164m legacy
fire safety provision was created and
charged to cost of sales in April 2022
in respect of the buildings the Group
agreed to remediate solely as a result
of signing the voluntary Building
Safety Pledge. This was treated as
exceptional as it is outside the normal
course of business, non-recurring and
material by size and nature. On 13
March 2023 Redrow signed the Self
Remediation Terms (SRT) contract with
DLUHC which follows on from the
Building Safety Pledge and the
equivalent Welsh version on 18 April
2023. The SRT widens builders’
responsibilities regarding potential
remedial work which may need to be
undertaken and led to a further £32m
of costs to be provided as a result of
this scope change. This was offset by
a reduction in the estimated costs of
the necessary works for the external
wall systems provided for in 2022.
There is therefore no exceptional item
in FY23.
S TAT U TO RY P E R F O R M A N C E
As statutory performance last year was
impaired by an exceptional item in
respect of the legacy fire safety
provision, the review of performance
above has been of underlying
performance i.e pre-exceptional. From
a statutory perspective gross profit of
£508m was £156m higher than the
£352m delivered in the prior year.
Operating profit was £399m (2022:
£250m) and profit before tax of £395m
was a £149m increase on the £246m
achieved in 2022.
TA X
The corporation tax charge for the
year was £97m (2022: £49m). The
Group's tax rate for 2023 was 24.5%
(2022: 20%). This increase in the
effective rate is a result of an increase
in the corporation tax rate to 25% from
1 April 2023 and a full year of
Residential Property Developers Tax
(RPDT) at the rate of 4% which was
introduced by HMRC from 1 April 2022.
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Financial review / continued
The normalised rate of corporation tax
for the year ending 30 June 2024 is
projected to increase to 29% based on
corporation tax and RPDT rates which
are substantively enacted currently.
The Group paid £82m of corporation
tax in the year (2022: £55m), in four
instalments.
D I V I D E N D S
The Board has proposed a 2023 final
dividend of 20.0p per share which will
be paid on 16 November 2023 to
Shareholders on the register on 22
September 2023, subject to
Shareholder approval at the 2023
Annual General Meeting. This gives a
full year dividend of 30.0p (2022:
32.0p) on earnings per share of 91.2p
(2022: underlying 96.0p1), a payout
ratio of 33% of underlying earnings, in
line with our stated policy.
R E T U R N S
Net assets at 2 July 2023 were
£2,026m (2022: £1,950m), a 4%
increase representing a NAV per share
of £6.13 following the £100m share
buyback and cancellation of 21,420,175
10.5p shares (2022: £5.54). Capital
employed at the same date was
£1,791m (2022: £1,662m) due to
increased levels of work in progress
and a reduction in land creditors. Our
return on capital employed decreased
to 23.11% (2022: 24.54%) due to the
lower profit and higher capital
employed (see note 15f ). Return on
equity also reduced to 19.9% (2022:
21.5%). (See note 23).
U N D E R LY I N G R E T U R N
O N C A P I TA L E M P LOY E D
%
3
5
8
2
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%
1
2
9
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%
3
5
8
1
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%
4
5
4
2
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%
1
1
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3
2
1 9
2 0
2 1
2 2
2 3
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L A N D
Our gross investment in land at
£1,684m (2022: £1,710m) reduced
slightly as a result of our cautious
approach to the land market in the
light of the uncertain economic
conditions. Our land holdings owned
with planning amounted to
approximately 4.8 years output (2022:
5.2 years). A review of the net
realisable value of our land holdings at
2 July 2023 resulted in a net £4m
increase in the net realisable value
provision to £26m (see note 14).
Our land buying expertise,
placemaking and design abilities and
strong balance sheet assist us when
we are in the market to secure quality
land holdings in primary locations.
During the financial year the Group
only added c1,900 plots with planning
permission to our current (owned and
contracted) land holdings (2022:
c6,000) due to ongoing economic
uncertainty. We closed the year with
26,070 plots in the current land
holdings, a 3,530 decrease on the
prior year (2022: c29,600 plots).
Approximately 58% of our current land
holding additions in FY23 came from
our forward land holdings. This is
higher than the prior year, reflecting
our reduced activity in the current land
market together with securing
implementable planning permissions
on a small number of strategic sites in
the year (2022: 27%). We closed the
year with 36,100 forward land holdings
(2022: 37,800 plots).
Land creditors decreased by £104m to
£272m at 2 July 2023 (2022: £376m)
representing 16.2% of gross land value
(2022: 22.0%). This is due to the timing
of land creditors maturing and the
reduction in land purchases.
Our owned plot cost has increased by
£7,000 to £88,000 (2022: £81,000)
whilst still representing 19% (2022:
19%) of the average selling price of
private legal completions in the year.
This reflects the geographic mix of our
land purchases in the year.
W O R K I N P R O G R E S S
Our investment in work in progress
has increased by £56m to £1,086m
C U R R E N T L A N D
H O LD I N G S BY
G E O G R A P H Y
2023
North
Central
South
London
Total
6,105
6,748
11,184
2,033
26,070
2022
North
Central
South
London
Total
6,995
7,573
12,599
2,433
29,600
(2022: £1,030m) as a result of build
cost inflation and increased outlets.
As a percentage of Homes Revenue it
increased to 52% from 49% last year.
R E C E I VA B LE S
Trade receivables and contract assets
decreased by £21m at 2 July 2023 to
£24m (2022: £45m) due primarily to
the timing of PRS and affordable
housing receipts. Other receivables
decreased from £25m to £13m mainly
due to the timing of the recovery of
VAT on land purchases.
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which exactly matches the projected
cashflows for all future pension
benefits. Thus under the bulk annuity
the Trustees will receive payments
from Standard Life which they will use
to pay pension benefits under the
Scheme.
The buy-in reduces future pension and
funding risk from a Company
perspective. However, the Trustees
making the strategic investment
decision and entering into the bulk
annuity buy-in contract does not
impact the Company’s obligations in
relation to the Scheme e.g. to ensure
the employee benefits are paid when
they fall due. Therefore, as the
Company retains responsibility for all
its obligations in relation to the
Scheme, it continues to treat the
Scheme as a defined benefit plan as
permitted by IAS 19 with £34m
charged to Other Comprehensive
Income in the period.
As a result, at 2 July 2023, the Group’s
financial statements showed a £5m
surplus (2022: £39m surplus) in
respect of the defined benefits section
of The Redrow Staff Pension Scheme
(which closed to future accrual with
effect from 1 March 2012).
Barbara Richmond
Group Finance Director
PAYA B LE S
(i) Liquidity
Trade payables, customer deposits
and accruals were £52m lower than
2022 levels at £561m (2022: £613m)
with trade payables increasing and
customer deposits and accruals
decreasing reflecting timing and levels
of activity.
P R OV I S I O N S
Provisions reduced by £12m overall
during the year to £195m (2022:
£207m). This was due to expenditure
on the legacy fire safety provision. We
expect £107m of this to be utilised in
FY24. Our expenditure in FY23 was
lower than the £97m expected due to
requests for payments to the Building
Safety Fund not being received in the
timeframe anticipated.
C A S H F LO W A N D N E T C A S H
There was a cash inflow generated
from operations of £244m in the year
(2022: £318m). This is lower than the
previous year mainly due to the
decrease in land purchases and
reduction in land creditors already
mentioned. This reduced our cash
conversion percentage (see note 23)
to 61% compared to 125% in the prior
year. We successfully completed the
£100m share buyback we announced
in July 2022 in the year. As a result we
closed the year with net cash
excluding lease liabilities of £235m
(2022: £288m).
F I N A N C I N G A N D T R E A S U RY
M A N AG E M E N T
Our unsecured £350m syndicated loan
facility was extended in March 2021
and is due to mature in September
2025.
Redrow remains a UK based
housebuilder and therefore the main
focus of its financial risk management
surrounds the management of liquidity
and interest rate risk. Financial
management at Redrow is conducted
centrally using policies approved by
the Board.
The Group regularly prepares and
reviews its cash flow forecasts
and stress tests them. These are
used to manage liquidity risks in
conjunction with the maintenance
of appropriate committed banking
facilities to ensure we maintain
medium term committed banking
facilities sufficient for a major
market breakdown.
Facilities are kept under regular
review and the Group maintains
regular contact with its banks and
other financial institutions; this
ensures Redrow remains attuned
to new developments and
opportunities and that our
facilities remain aligned to our
strategic and operational
objectives and market conditions.
Our current banking syndicate
comprises six banks and in
addition to our committed
facilities, Redrow also has further
uncommitted bank facilities which
are used to assist day to day cash
management.
(ii) Interest rate risk
The Group is exposed to interest
rate risk as it borrows money at
floating rates. Redrow
occasionally uses simple risk
management products, notably
sterling denominated interest rate
swaps, as appropriate to manage
this risk. Such products are not
used for speculative or trading
purposes. Redrow regularly
reviews its hedging requirements.
No hedging was undertaken in the
year or the previous financial year
and no interest rate swaps are
held currently (2022: nil).
P E N S I O N S
On 27 January 2023, the Trustees of
the Redrow Staff Pension Scheme
entered into a bulk annuity buy-in
contract with Standard Life. This
transaction is part of the Trustees
strategy to reduce the Scheme’s
exposure to risk with the Trustees
agreeing to exchange the assets of
the Scheme for an insurance policy
1
Redrow uses a variety of statutory performance measures and alternative performance measures when reviewing the performance of the Group. Underlying is
defined as any statutory or alternative performance measure pre-exceptional items. See note 23 for an explanation and reconciliation of these alternative performance
measures.
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Risk management
HOW WE MANAGE RISK
BOA R D OV E RS I G HT
M A I N B OA R D
Audit Committee
Nomination Committee
Remuneration Committee
Placemaking and
Sustainability Committee
O PE R ATI O N A L M E E TI N G S
E X E C U T I V E M A N AG E M E N T T E A M
Divisional Boards
Functional Seminars
Team Meetings
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P O LI C I E S F O R I D E NTI F Y I N G A N D CO NTRO LLI N G R I S KS
Budgeting & Forecasting
Price & Sales Monitoring
Cost Reviews
Land Bank Management
PROC E DU R E S A N D I NTE R N A L CO NTRO L S
Business Policies and Procedures
Authorisation Processes
System Based Controls
Business Process Reviews
Site Completion Reviews
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Professionalism
Clear Communication
Qualified Personnel
Pride and Achievement
Interests Aligned with Stakeholders
Commitment to Training
B US I N ESS R IS KS
88
OUR RISK MANAGEMENT
PROCESS
Our Risk Assessment Process
Key Risk Management Objectives:
• To ensure our approach to risk meets the ongoing needs of our business and its key stakeholders;
• To ensure that a robust assessment is made of emerging and principal risks;
• To effectively communicate our risks and define responsibilities in order to manage risk;
• To continually evaluate and review the impacts of any potential new risks occurring within our business; and
• To develop and implement action plans to mitigate risks as appropriate.
I D E N T I F Y
Key areas
of focus
M I T I G AT E
R E V I E W
M O N I TO R
Implement control
processes and insurance
Performance, principal
risks and controls
Use of key
risk indicators
M A I N B OA R D
• The ultimate responsibility for the effective management of the risks we face in order to achieve our strategic
and financial objectives lies with the Main Board;
• Material and emerging risks and principal concerns are identified and robustly assessed as part of our risk
assessment framework, following a detailed review of the Company’s strategic objectives;
• These headline risks are then approved by the Board to be included within our risk register;
• The risk register is reviewed formally annually and updated for any new risks identified during our Risk
Assessment processes; and
• It is also presented to the Audit Committee for final review and consideration to ensure that it is appropriate and
reflects our business risks.
O P E R AT I O N A L D I V I S I O N S
• All identified high level risks are then further broken down into components and sub level risks to be considered
at the divisional level and Group department level;
• Management responsibility to implement the Board’s polices on risk management and internal controls; and
• Internal controls operated to mitigate, control and continuously monitor these risks.
R I S K O W N E R S & E X E C U T I V E M A N AG E M E N T T E A M
• Any new risks identified at divisional level and Group department level are individually robustly assessed and
evaluated on their potential impact to the business and its likelihood of occurrence;
• These risks are then communicated to the Risk Owners who will use this assessment to inform their formal view
on these risks and all previously identified risks;
• The probability and potential impact for each sub level risk is assessed by the Risk Owners;
• It is then the Risk Owners responsibility to ensure key preventive and detective controls are designed and
implemented to address these risks and ensure their inclusion in our risk register; and
• Group Policies and Procedures are updated to reflect any new or improved key controls or processes.
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Risk management / continued
PRINCIPAL RISKS
The Board has carried out a robust assessment of the Group's emerging and principal risks.
The following tables outline Redrow's principal risks, together with key controls and mitigating strategies.
S T R AT E G I C O B J E C T I V E
R I S K
H O U S I N G M A R K E T
The UK housing market conditions have a direct impact on
our business performance.
Whilst pandemic risk has been reduced in the year, this has
been more than offset by the impact of the uncertain
economic conditions on the housing market, the cost of
living crisis and high interest rates.
R I S K O W N E R S
Group
Chief Executive
Group
Commercial
Director
K E Y S U P P LI E R O R S U B C O N T R AC TO R FA I LU R E
The failure of a key component of our supply chain to
perform due to financial failure or production issues could
disrupt our ability to deliver our homes to programme and
budgeted cost.
This year the risk has reduced slightly due to the risk of a
significant disaster e.g. a pandemic reducing, offset to a
large extent by an increase in the risk of key supplier or
subcontractor failure due to inflationary and interest rate
pressures.
P L A N N I N G A N D R E G U L ATO RY E N V I R O N M E N T
The inability to adapt to changes within the planning and
regulatory environment could adversely impact on our
ability to comply with regulatory requirements.
This year the risk has increased due to the house building
industry continuing to be subject to a rapidly moving
Government regulatory agenda.
Group
Communities
Director, Group
Human
Resources
Director, Group
Company
Secretary and
Managing
Director (Harrow
Estates)
90
R I S K
M OV E M E N T
E X A M P LE K E Y
R I S K I N D I C ATO R S
• Leading market
indicators re volumes
and values
• Weekly sales
statistics
• Material and trade
shortages
• Material and trade
price increases
• Advance payment
applications
• Reluctance to tender
for new business
• Government
consultations
• Planning approval
statistics
• Proposed
Government
legislation
K E Y C O N T R O L S A N D M I T I G AT I N G S T R AT E G I E S
Ongoing and regular monitoring of Government policy
consultations and developments and lobbying as appropriate.
Close monitoring of Government guidance.
Market conditions and trends are being closely monitored allowing
management to identify and respond to any sudden changes or
movements.
Weekly review of sales at Group, divisional and site level with
monitoring of pricing trends and customer demographics.
Ensuring strong relationships with lenders and valuers to ensure
they recognise our premium product.
Delegated Crisis Committee established with Executive
Management Team meetings a minimum of twice weekly in times of
crisis.
Use of reputable supply chain partners with relevant experience
and proven track record and maintain regular contact.
Monitoring of subcontract supply chain to maintain appropriate
number for each trade to identify potential shortage in skilled
trades in the near future.
Subcontractor utilisation on sites monitored to align workload
and capacity.
Materials forecast issued to suppliers and reviewed regularly.
Collaborate with Supply Chain Partners in development of supply
continuity strategies.
Group Monthly Product Development meetings to identify and
monitor changes in the regulatory environment.
Tracking of construction cost movements.
Lobby and communicate with local authorities to facilitate early
collaboration to shape developments including where a National
Model Design Code (NMDC) is required.
Close management and monitoring of planning expiry dates
and CIL.
Well prepared planning submissions addressing local concern and
deploying good design.
Careful monitoring of the regulatory environment and regular
communication of proposed changes across the Group through the
Executive Management Team.
Proactive approach to managing data protection with multi-
functional team meeting regularly.
Effective engagement with local authorities to understand the
extent of their policies relating to climate change.
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Risk management / continued
S T R AT E G I C O B J E C T I V E
R I S K
AVA I L A B I LI T Y A N D A F F O R DA B I LI T Y O F M O R TG AG E
F I N A N C E
Availability and affordability of mortgage finance is a key
factor facilitating liquidity in the housing market.
This risk has increased in the year due to the increase in
mortgage rates and the restriction on mortgage availability.
R I S K O W N E R S
Group Finance
Director
K E Y C O N T R O L S A N D M I T I G AT I N G S T R AT E G I E S
Proactively engage with the Government, Lenders and Insurers to
support the housing market.
Expert New Build Mortgage Specialists provide updates on and
monitoring of regulatory change.
S U S TA I N A B I LI T Y
Risks associated with failure to embed sustainable
development principles.
Group
Communities
Director
This risk has reduced slightly due to the focus on
sustainable development and update of our sustainable
operating framework.
C U S TO M E R S E R V I C E
Failure of our customer service could lead to relative under
performance of our business.
Group Customer
& Marketing
Director
This risk has reduced in the year reflecting the
implementation of the New Homes Quality Code.
Preparation and planning underway for Future Homes standard.
Preparation for future Environmental Bill through implementation of
our Nature for People Strategy.
Close monitoring of Government strategy and guidance.
Regular benchmarking against peers.
ESG scorecard.
Risks and opportunities assessment aligned to TCFD framework.
Training for divisional teams.
Appointment of a Group Sustainability Director.
Customer and Quality Director.
My Redrow website to support our customers purchasing their new
home. Increased use of digital and virtual communication tools.
Online systems provide a full audit trail of the sales process.
Full training on New Homes Ombudsmen requirements.
Annual review of adherence to NHQB Quality Code procedures
compliance signed by divisional Managing Director.
Attention to customer feedback supported by a process at nine
months post occupation to address root cause of customer fatigue
and dissatisfaction.
Bespoke digitisation of complaints management system for
improved visibility and efficiency.
Regular review of our marketing and communications policy at both
Group and divisional level.
R I S K
M OV E M E N T
E X A M P LE K E Y
R I S K I N D I C ATO R S
• Loan to value metrics
• Number of mortgage
products readily
available
• Group GHG emissions
Scope 1 & 2
• % of timber certified
• Average SAP rating
• Tonnes of
construction waste
per 100m2 build
• % of materials
suppliers and
manufacturers who
have actively
confirmed compliance
with the Modern
Slavery legislation
and Redrow Code of
Conduct
• Customer satisfaction
metrics (see page 46)
• NHBC Construction
Quality Review scores
and Reportable Items
(see page 46)
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Risk management / continued
S T R AT E G I C O B J E C T I V E
R I S K
H E A LT H , S A F E T Y A N D E N V I R O N M E N T
Non-compliance with Health & Safety standards and
Environmental regulations could put our people and the
environment at risk.
R I S K O W N E R S
Group Health,
Safety and
Environmental
Director
C Y B E R S E C U R I T Y
Failure of the Group’s IT systems and the security of our
internal systems, data and our websites can have significant
impact to our business.
Chief Information
Officer
The risk of cyber attacks and data and systems breaches
increased across the UK business landscape and therefore
ourselves. Our risk was mitigated in part by our investment
in further IT security measures during the year.
L A N D P R O C U R E M E N T
The ability to purchase land suitable for our products and
the timing of future land purchases are fundamental to the
Group’s future performance.
This has increased slightly during the year due to the impact
of regulatory requirements.
Group Chief
Executive and
Managing
Director (Harrow
Estates)
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R I S K
M OV E M E N T
E X A M P LE K E Y
R I S K I N D I C ATO R S
• Annual Injury
Incidence Rate (AIIR)
(see page 252)
• HS&E Assurance
Audits outcomes
• ‘Near Miss’ statistics
• Level of instances
reported in the media
• Penetration test
results
• Forward land pull
through (see page 86)
• Owned land holding
years (see page 9)
• Land offer statistics
K E Y C O N T R O L S A N D M I T I G AT I N G S T R AT E G I E S
Dedicated in-house team operating across the Group to ensure
compliance of appropriate Health and Safety standards supported
by external professional expertise.
HS&E Assurance Audits.
Monthly Divisional HS&E Leadership meetings.
Group and Regional HS&E Leadership meetings.
Internal and external training provided to all employees.
ISO 14001 environmental management system covering all business
operations.
Divisional Construction (Design and Management) Regulation
(CDM) inspections carried out to assess our compliance with our
client duties under CDM.
Health and Safety discussion at both Group and divisional level
board meetings supported by performance information.
CDM competency accreditation requirement as a minimum for
contractor selection process.
Regular monitoring and reporting on environmental performance.
Cyber Awareness campaigns.
Communication of IT policy and procedures to all employees.
Regular systems back up and storage of data offsite.
Web access allowed list.
Internal IT security specialists.
New Security Operation Centre.
Use of third party entity to test the Group’s cyber security systems
and other proactive approach for cyber security including Cyber
Essentials Plus accreditation.
Compulsory GDPR and IT security online training to all employees
within our business.
Cyber Insurance.
Proactive monitoring of the market conditions to implement a clear
defined strategy at both Group and divisional level.
Experienced and knowledgeable personnel in our land, planning
and technical teams.
Appropriate investment in strategic land programme supported by
specialist Group team.
Effective use of our Land Bank Management system to support the
land acquisition process.
Close monitoring of progress of relevant Local Plans.
Peer review by Legal Directors and use of third party legal
resources for larger site acquisitions to reduce risk.
Monitoring of emerging legislation to inform land assessments and
purchase terms.
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Risk management / continued
S T R AT E G I C O B J E C T I V E
R I S K
F R AU D/ U N I N S U R E D LO S S
A significant fraud or uninsured loss could damage the
financial performance of our business.
R I S K O W N E R S
Group Finance
Director
A P P R O P R I AT E N E S S O F P R O D U C T
The failure to design and build a desirable product for our
customers at the appropriate price may undermine our
ability to fulfil our business objectives.
Group Design
and Technical
Director
This risk has increased in the year due to the impact of
increased regulatory requirements and the risk of aligning
design challenges and customer expectation when
introducing new technologies.
AT T R AC T I N G A N D R E TA I N I N G S TA F F
The loss of key staff and/or our failure to attract high
quality employees will inhibit our ability to achieve our
business objectives.
Group Human
Resources
Director
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R I S K
M OV E M E N T
E X A M P LE K E Y
R I S K I N D I C ATO R S
• Business Process
Review outcomes
• Insurance Review
outcomes
• Customer satisfaction
metrics (see page 46)
• Focus Group
feedback
• Emerging planning
regulation
• Employee turnover
levels (see page 256)
• Employee
engagement score
(see page 256)
K E Y C O N T R O L S A N D M I T I G AT I N G S T R AT E G I E S
Systems, policies and procedures in place which are designed to
segregate duties and minimise any opportunity for fraud.
Regular Business Process Reviews undertaken to ensure
compliance with procedure and policies followed by formal action
plans.
Timely management reporting.
Insurance strategy driven by business risks including Cyber
Insurance.
Fraud awareness training.
Regular review and product updates in response to the demand in
the market and assessment of our customer needs.
Design focused on high quality build and flexibility to
planning changes.
Regular site visits and implementation of product changes to
respond to demands.
Focus on award winning Heritage Collection.
Manufacturers providing specific training to subcontractors re new
technologies installation.
Regular design and technical seminars.
Monitor Government emerging legislation.
In-house training offering blended learning to all employees.
Suite of development programmes for identified talent from first
line manager to Director.
Move to agile working practices embracing use of remote working.
Graduate training, Undergraduate placements and Apprentice
training programmes to aid succession planning.
Bespoke housebuilding degree course in conjunction with
Liverpool John Moores University and Coleg Cambria.
Remuneration strategy in order to attract and retain talent within
the business is reviewed regularly and benchmarked.
Engagement Team and continued refinement of internal
communications platform in addition to annual employee survey to
create framework for strong, two-way communication.
Flexible Working Policy.
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Risk management / continued
S T R AT E G I C O B J E C T I V E
R I S K
LI Q U I D I T Y A N D F U N D I N G
The Group requires appropriate facilities for its short-term
liquidity and long-term funding.
R I S K O W N E R S
Group Finance
Director
C LI M AT E C H A N G E
Risks associated with the potential physical effects of
climate change and the regulatory and mandatory reporting
environment around climate change.
Group
Communities
Director
R I S K
M OV E M E N T
E X A M P LE K E Y
R I S K I N D I C ATO R S
• Cash conversion
• Forecast undrawn
committed facilities
• Group GHG emissions
• Scope 1, 2 & 3
• Average SAP rating
K E Y C O N T R O L S A N D M I T I G AT I N G S T R AT E G I E S
Medium term committed banking facilities sufficient for a major
market breakdown.
Regular communication with our investors and relationship banks,
including visits to developments as appropriate.
Regular review of our banking covenants appropriateness and
design and capital structure.
Ensuring our future cash flow is sustainable through detailed
budgeting process and reviews and scenario modelling.
Strong forecasting and budgeting process.
Monitor requirements for future bonds in emerging planning
agreements.
Risks and opportunities assessment aligned with TCFD framework
and Climate-Related Financial Disclosures.
Ensure appropriate consideration is given to product design and
placemaking to mitigate potential climate change impacts.
Identify new products, processes and services aimed at improved
energy performance and reducing Green House Gas emissions.
Undertake climate-related scenario analysis.
Commitment made to the Business Ambition for 1.5°C and to reach
Science-based net zero carbon emissions no later than 2050 with
near-term targets verified.
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Going concern and viability statement
Interior in The Stratford show home at
Parc y Coleg, Newport, Gwent.
GOING CONCERN AND
VIABILITY STATEMENT
An assessment of going concern is included in the Basis of Preparation section of the Accounting Policies on page 214.
Viability
In accordance with Provision 31 of the UK Corporate Governance Code 2018, the Directors have assessed the prospects
and viability of the Group.
The Directors’ assessment has made reference to our current position, the potential impact of the principal risks facing
the Group together with the further potential impact of the uncertain economic and housing market conditions, cost of
living pressures, the impact on consumer confidence levels, the continuing war in Ukraine and disruption in the energy
and fuel market.
The Group has a £350m Revolving Credit Facility (RCF) (2022: £350m) provided by an established syndicate of six banks
being Barclays Bank PLC, Lloyds Bank Plc, The Royal Bank of Scotland Group Plc, Santander, HSBC and Svenska. This
expires on 30 September 2025 (2022: 30 September 2025) and is a committed unsecured facility. As at 15 September
2023, £350m of this facility was undrawn. It is likely that the RCF will be renewed prior to its expiry in September 2025.
The Directors have selected a three year timeframe over which to assess the viability of the Group from 3 July 2023 to
30 June 2026. This timeframe was selected as it:
• corresponds with the Board’s strategic three year planning horizon;
• corresponds with the performance timeframe of the Long Term Incentive Plan (see page 174);
• corresponds to the timeframe required by the syndicate banks when amending or renewing the RCF;
• represents a reasonable estimate of the typical time between purchasing a site with an outline planning consent,
progressing through detailed planning consent and building and selling the first phase of the development; and
• allows due consideration of the impact of Government policy and regulatory change.
On an annual basis, the Directors formally review the financial forecasts for the Group including cashflow forecasts.
These forecasts incorporate assumptions about the timing of legal completions of new homes and land purchases, build
cost inflation, interest rates, profitability and working capital requirements. The Directors identified the Principal Risks
that have the most impact on the viability of the Group within the three year period as:
(i) Housing market;
(ii) Key supplier or subcontractor failure;
(iii) Planning and regulatory environment; and
(iv) Availability and affordability of mortgage finance.
These have informed our stress testing and the three year plan has been stress tested taking into account the following
severe but plausible downside assumptions:
• A 10% price reduction on all unexchanged private and social legal completions for FY24 and FY25 concern compared
to the base case Board approved budgeted prices (Risk (i) and (iv) above);
• A 30% volume reduction for FY24 and FY25 and a 15% volume reduction for FY26 compared to the base case Board
approved budgeted volumes (Risk (i), (ii), (iii) and (iv) above);
• In addition to the build cost inflation incorporated within the base case Board approved budgeted costs, an additional
3% build cost inflation has been applied to all build costs from Q1 FY24 falling to 2% from Q1 FY25 (Risk (ii) and (iii)
above); and
• The Bank of England base rate increasing to 6% during FY24 before reducing gradually to 4.0% by the end of the
viability assessment period.
Mitigations to this sensitivity analysis include a reduction in land investment and development and a reduction in
dividends to align with the Company dividend payout ratio policy.
The Directors’ confirm that they have a reasonable expectation that the Group will be able to continue in operation and
meet its liabilities as they fall due over the three year period ending 30 June 2026.
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Task force on climate related financial disclosures (TCFD)
TASK FORCE ON CLIMATE
RELATED FINANCIAL
DISCLOSURES (TCFD)
I N T R O D U C T I O N
The following section outlines Redrow's disclosure of
Climate-Related Financial Disclosures in line with the
requirements of the London Stock Exchange Listing Rules,
Section 414(CB)2A of the Companies Act 2006 and the
TCFD Recommendations and Recommended Disclosures
taking into consideration Sections C and E of the TCFD
Annex. Financial quantification has not been disclosed due
to data availability however financial risk level
categorisations have been provided. We confirm that we
are compliant with all recommended disclosures save for
our partial compliance with the recommended disclosure
'Metrics and Targets A' as not all cross-industry metrics are
fully disclosed within this TCFD report. GHG emission and
remuneration metrics have been disclosed and we are
working to improve operational procedures and reporting
for the remaining metrics (transition and physical risks,
climate-related opportunities, capital deployment and
internal carbon prices). In 2024 we will set a route map and
timeline for future disclosure of unreported metrics.
The following section clearly references where any
relevant information can be found in other sections of this
Annual Report, or separate sources.
We understand that integrating climate-related risks into
our operations and strategy will create opportunities which
will allow our customers to make choices appropriate to a
low carbon lifestyle, and to live in homes that are suitable
for the changing climate. We will mutually support our
supply chain in their own net zero carbon journey, which
will allow us to maintain long term value for all our
stakeholders, and we welcome the opportunity this
represents.
We see this transition as part of our long-term strategy,
with much uncertainty about how the world will change.
Alongside the necessary operational emission reduction
and mitigation plans, the business will be challenged to
consider the short, medium and long-term in terms of its
investments and solutions, and to engage with a range of
possible future operating contexts. As part of our horizon
scanning, we also see the importance to investors of
non-financial disclosures increasing, with sustainability
reporting and associated data capture and systems
increasingly mandated, and perhaps in some cases placed
on an equal footing with financial reporting. These will
support the robust systems we have in place and the work
we have completed in our fourth year of TCFD reporting.
The climate-related risks and opportunities have been
assessed during the year along with the scenario analysis.
The scenarios chosen last year remain appropriate for the
business and as such there has been no change to those
during the year. Embedding the impacts of the possible
climate change scenarios into the business remains an
active and ongoing process to ensure that our strategic
response is current and appropriate.
During 2023 we have undertaken work to develop more
robust KPIs and metrics to measure and monitor the
financial impact of climate-related risks and opportunities
for the business. We have also reviewed our priority risks
and opportunities to identify any changes due to a
changing climate and economic landscape, to improve the
accuracy and robustness of the quantifications, and to
ensure the methodologies employed are specific to our
operations.
We have undertaken a series of workshops to examine
site-level physical risks posed by climate change under a
hot-house scenario in 2050 and beyond. Anomaly
temperature changes, precipitation rates, and wind gust
projections from the UK Met Office Climate Projections
(UKCP) model were explored at four of our strategic sites
under development. This exercise has allowed us to review
current physical risk management processes to identify
necessary changes to improve the mitigating activities for
extreme physical risks, as well as adapt products to future
changing climate. See page 105 for an overview of this
research project.
Lastly, we have also commenced work to align with the
TCFD’s seven cross-industry metrics, and work will
continue into 2024 to quantify.
1 . G OV E R N A N C E
Role of the Board
The organisational governance structure is outlined on
page 136 and the governance structure for sustainability is
outlined on page 165.
The Group Chief Executive has ultimate responsibility for
climate-related matters. The Group Chief Executive, being
the Board Sponsor for sustainability and climate-related
matters, sits on the Executive Management Team, the
Committee and the Main Board. This ensures that climate
matters remain an active area of debate at Executive,
Committee and Main Board level and such matters are
discussed at each meeting held across the three levels.
102
business. The following are examples of the working
groups actively working in this area at present:
i. Net Zero Carbon working group;
ii. Climate Change Risk steering group;
iii. Biodiversity working group;
iv. Part L Building Regulation working group;
v. Environment Management review group; and
vi. Build and Waste working group.
• Group Health, Safety and Environment Leadership
Committee (“Group HSE Committee”) – develops and
monitors the Company’s approach to environmental
sustainability matters and regularly reviews the
objectives and effective operation of the ISO 14001
Environmental Management System.
The Group Communities Director and Group Sustainability
Director are accountable for identifying and assessing
climate-related risks and opportunities. Responsibilities for
managing each of these risks are allocated to Directors/
Heads of Departments appropriately and discussed within
specific and relevant working groups across the Group.
Actions and results are fed back to the Executive
Management Team and, where appropriate to, the
Placemaking and Sustainability Committee and Main Board.
2 . S T R AT E GY
Identification and Impact of Significant Risks
Redrow currently works collaboratively with specialist
consultants, architects, engineers, planning authorities and
building control to mitigate and manage short and medium-
term risks as part of our operational strategy. As part of our
increased focus on climate impacts and our net zero
carbon commitments, our approach evolved last year to
assess risks and opportunities that may be impacted by the
changing nature and increasing severity of physical
impacts from climate change, and increased likelihood of
transitional risks.
To identify and prioritise climate-related risks and
opportunities, we generated a long-list of potential
physical and transitional risks and opportunities that are
posed to any business by climate change. We then
convened a group of stakeholders representing key
functions and operations across the business to
qualitatively prioritise these risks and opportunities by
potential financial impact and likelihood in the short,
medium, and long-term outlook under current operating
condition. The impact timeframes chosen are as follows:
Climate-related matters are governed as follows:
• Main Board – the overall responsibility for the
stewardship of the Company’s placemaking and
sustainability framework (including its approach to
environmental, social and governance (“ESG”) matters
inclusive of climate change), compliance and
performance are reserved for the Board.
• Placemaking and Sustainability Committee – delegated
responsibility from the Board to consider material issues
relating to sustainability policies, assess the
effectiveness of sustainability practices and review other
material ESG issues, including climate-related issues,
where the expertise of the Committee is required. This
Committee is responsible for monitoring the Company’s
strategy on climate change as set out by the Group Chief
Executive and the Group Communities Director and
reporting back to the Board in respect of this.
• Audit Committee – climate-related issues discussed at
least twice per year, as part of its review of the Risk
Register. The Audit Committee also reviews the work
undertaken in respect of TCFD twice per year, which
includes approval of the TCFD-aligned report to be
included within the Annual Report.
• Remuneration Committee – considers climate-related
issues at its meetings as there is now a climate reduction
target included for the Long-Term Incentive Plan (LTIP)
options, as outlined on page 181 , and the Remuneration
Committee will assess the performance of the Company
against this target.
Role of Management
Climate-related matters are managed as follows:
• Executive Management Team – the Group Communities
Director has direct management responsibility for
climate-related and sustainability matters and sits on the
Executive Management Team with the Group Chief
Executive who has ultimate responsibility for these
matters. The Executive Management Team have
responsibility for the overall delivery of objectives and
targets of the three pillars of the operational framework
(Thriving Communities, Building Responsibly and Valuing
People) and the ESG scorecard. The heads of
departments are responsible for managing the
implementation plans that are in place to deliver the
Group’s sustainability objectives, including in respect of
climate-related matters, and KPI targets and the Group’s
Divisions support the delivery of these through their
day-to-day practices.
• Cross Departmental Working Groups – the Group
Communities Director and the Group Sustainability
Director both chair and attend several cross
departmental working groups across the business which
include the Group Design and Technical Director, Group
Commercial Director, Group Customer & Marketing
Director, Chief Information Officer, Group HR Director,
Group Masterplanning Director, Group HS&E Director
and Group Construction Director. These cross-discipline
meetings ensure that climate and sustainability-related
issues are understood and implemented across the
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Task force on climate related financial disclosures (TCFD) / continued
I M PAC T T I M E F R A M E
D E S C R I P T I O N
W H Y C H O S E N ?
Short
1-3 years
Medium
3-10 years
Chosen in line with the time frame for viability assessment and
corresponds with the Board’s three year planning horizon.
Chosen in line with the near term SBTi target (2030) and time
frame corresponds to 5.2 year land holding year KPI.
Long
10-30 years
Chosen in line with our SBTi net zero emissions target (2050).
This prioritisation was also informed and supported by a series of stakeholder interviews conducted across senior
management in both divisional and group functions of the business. The risks and opportunities have been reviewed
during the year and a summary of those deemed significant to the business can be seen below:
C AT E G O RY
D E S C R I P T I O N
P OT E N T I A L
F I N A N C I A L I M PAC T
I M PAC T
T I M E F R A M E
Transition
Regulation
Impact of new building
regulations and
planning requirements
in response to further
climate change
impacts
Increased production
costs to adopt the new
requirements
Short
Transition
Regulation
Introduction of
regulatory financial
penalties for carbon
emissions
Long
Increased costs from
increasing taxes,
emissions trading, or
other penalties for
carbon emissions
Transition
Market
Volatility in the energy
market
Increased operating
costs
Short
Transition
Market
Increasing demand on
the national electricity
grid
Medium
Increased production
costs due to changing
input prices (energy)
and output
requirements (on-
demand charging)
M A N AG E M E N T & R E S P O N S E
Design and costing for potential
solutions to ensure homes meet
future regulatory requirements.
Target set to reduce our absolute
scope 3 GHG emissions 25% by
2030 from a 2021 base year, which
includes reducing emissions from
homes in use.
Reviewing potential changes in
legislation and developing possible
cost effective solutions, including
exploration of new technologies and
designs.
Trialling of new technologies to
replace fossil fuel use. Target set of
reducing our absolute scope 1 and 2
GHG emissions 42% by 2030 from a
2021 base year.
Employment of specialist energy
brokers to identify lowest cost
options for renewable energy
purchases.
Trialling energy efficiency
technologies such as solar panels
and energy efficient site cabins to
reduce energy demand.
Detailed planning for energy
demand forecasts and cost
evaluation for any additionally
required energy infrastructure costs
included earlier into the financial
evaluation process.
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C AT E G O RY
D E S C R I P T I O N
Physical
Acute
Increasing frequency
of extreme weather
events
Opportunity
Market
Attracting and
retaining employees
through climate
change credentials
Opportunity
Reputation
Customer preference
for low-carbon homes
in sustainable places
P OT E N T I A L
F I N A N C I A L I M PAC T
I M PAC T
T I M E F R A M E
M A N AG E M E N T & R E S P O N S E
Long
Medium
Reduced revenue and
higher costs from
decreased production
capacity (e.g. transport
difficulties, supply
chain interruptions and
potential decrease in
land availability e.g.
floodplains expanding)
Benefits to workforce
management and
planning (e.g.
improved health and
safety and employee
satisfaction) resulting
in lower costs and
turnover rate savings
Medium
Reputational benefits
resulting in increased
demand for goods/
services and a price
premium in the market
with marketing
opportunities
Monitoring frequency, location and
severity of extreme weather events,
insurance market response and
regulatory change in response to
extreme weather events in the UK.
Regular review of policies and
procedures for considering flood risk
when procuring land or planning a
development.
Providing information of our climate
change commitments and progress
through our website and social
media, and including climate change
information in inductions and
training.
Development of business processes
that support employees to make low
carbon choices in work (e.g. EPD
information for low carbon products,
EV cars, cycle to work schemes etc.).
Continued focus on providing
products and places to allow our
customers to make low-carbon
choices.
Providing information to customers
throughout the sales process on the
energy efficiency benefits of our
homes.
As part of the review of the risks during the year, we are
monitoring the risk of increased supply chain costs, both
due to physical and transitional impacts of climate change
on our suppliers’ operations. The assessment of the impact
that climate change may have on supplier costs will be
considered as part of setting our long term SBTi net zero
carbon target later this year. We will then use this
assessment to quantify the risk of increased supply chain
costs to understand whether this is a significant risk for the
business.
The assessment of these risks and opportunities are
reviewed annually as part of the annual risk review process
and updated in response to changing operating context
and findings from scenario analysis activities.
Impact on Business Model
During the year, we sought to further understand the actual
and potential physical risks from climate change on our
business model. A research project was conducted to
explore the localised impacts of our changing climate on
the development process at four strategic developments
sites across England (impacts being based on the high
impact global-emissions to align with the Hot House
scenario used in our scenario analysis).
The project investigated how our strategic development
process currently addresses climate-related physical risks
and sought to identify the necessary adaptations required
to navigate climate change. To understand site-specific
technical details and the wider development processes, a
range of site technical, regional and Group stakeholders
attended a series of workshops.
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The general workshop discussed the initial stages of our
strategic development processes, from land search
through to tender. The following themes came out of this
workshop:
1.
2.
3.
4.
Further consideration could be given of extreme
weather events in both the design and construction
planning stages;
Increased and earlier due diligence and on-site
monitoring to further understand and track evolving
climate-related physical risks;
Continued assessment of the suitability of materials for
a changing climate, considering factors such as
durability and resilience; and
Reiteration that local infrastructure capacity (such as
electrical grid capacity for electric vehicles and air
source heat pumps) becomes a crucial aspect of
planning and development and a key consideration as
the UK economy transitions towards zero-carbon.
There were then four site specific workshops held to
explore the UK Met Office Climate Projections (UKCP) at a
site level, and associated impacts on the later stages of our
strategic development process from programme
development through to completion. The following themes
came out of these workshops:
1.
2.
Earlier cross-team planning may allow for more
bespoke plans to individual sites resulting in an
improved site layout and phasing of activities onsite;
Further forecast and planning to be made for the
transition risks associated with changing regulations
and requirements;
3.
4.
Increased interrogation of data during the land
acquisition stage with more on-site investigation and
monitoring during changing seasons and weather
events to better understand the potential impacts of
extreme weather on sites; and
Further exploration of new technologies and materials
to not only adapt to future physical impacts but also to
reduce the whole life carbon footprint by improving
energy efficiency and reducing embodied carbon.
The workshops were insightful and served as a platform to
identify key pinch points and potential challenges that may
arise when updating processes, KPIs and strategies for
adapting to future climate-related risks. Feedback from this
workstream was reported through the Executive
Management Team and will go to the Main Board in due
course via the Placemaking and Sustainability Committee.
Impact on Strategy
Redrow recognises that many of the climate-related risks
and opportunities we face will impact the wider industry
too, and lead to a complex operating environment both
physically, due to changing climate/weather, and as a result
of the transition to a net zero carbon economy.
A description of our approach to supporting the United
Nations Sustainable Development Goals and the impact on
the Company's business and strategy, in particular SDG13
(Climate Change) and SDG15 (Life on Land), can be found
within our Operational Framework for FY24 on page 266.
The following are areas of strategic focus of the Board to
help on our journey to net zero and the associated targets
to track progress are outlined on page 113.
A R E A O F S T R AT E G I C F O C U S
H O W T H I S I S B E I N G M A N AG E D?
R E A D M O R E
Build resilience to a changing
climate through risk management
• Climate-change is embedded into the Group’s risk
Page 112
management processes.
• Scenario analysis for climate change is qualitatively assessed
annually to ensure risks and opportunities remain current and
the business can respond to mitigate.
106
A R E A O F S T R AT E G I C F O C U S
H O W T H I S I S B E I N G M A N AG E D?
R E A D M O R E
Reduce carbon emissions from
our operations
• Trialling of low-carbon technologies in the move to reduce
Page 50
emission, such as:
• Low-carbon heating solutions (hybrid generators) with solar
PV and an energy management system;
Associated
Targets
• Collaborating with manufacturers to assess the design, build,
and consumer implications of introducing air-source heat
pumps in lieu of gas boilers, in our homes and for our
customers; and
• Hydrotreated Vegetable Oil (HVO) trialled as an alternative to
diesel for on-site generators and construction machinery.
• Purchasing renewable energy for our offices, plots, show
homes, and site compounds.
• Installation of car charging stations at all divisional offices and
introduction of charging stations at our sites and customer
experience suites.
• We have targets to have a 100% EV car fleet by 2025.
• We have a route map to net-zero which can be found on page
56.
Understand and minimise our
embodied carbon
• Educating suppliers and encourage the setting of their own
Page 54
science-based targets.
• Improving the accuracy of our procurement data to give greater
visibility on quantities and carbon emissions.
Associated
Targets
• Requiring suppliers to provide Environmental Product
Declarations (EPDs) for their products before the end of 2024.
• Continual engagement and work alongside our supply partners
to ensure we can achieve our shared goal of carbon reduction.
Deliver attractive low carbon
homes
• Keeping up to date with latest technology and adopting
Page 44
technology such as air source heat pumps so that our homes
can become zero-carbon ready.
Associated
Targets
Align executive remuneration with
our climate commitments
• In recognition of the increasing importance of climate reduction
Page 181
being embedded into strategy, the LTIP options granted in
2022 and those to be granted in September 2023 contain a
climate reduction target.
Associated
Targets
Set ambitious emissions
reductions targets in line with
climate science
• Assessment of the performance of the Company against the
climate-related LTIP target will be regularly reviewed by the
Remuneration Committee.
• The Company announced its Net Zero Carbon Commitment in
2021 and set a ‘science based’ long-term goal (2050 at the
latest) to achieve ‘Net Zero Carbon’ as a business (both direct
and indirect carbon emissions from Scopes 1, 2 and 3). In line
with this we have set the following Science Based Targets
initiative (“SBTi”) verified commitments:
Page 50
Associated
Targets
• Near-term 1.5˚C reduction commitment for our absolute
Scopes 1 and 2 by 2030 – emissions reduction of 42% from a
2021 base year; and
• Well Below 2˚C reduction commitment for our absolute
Scope 3 by 2030 – emissions reduction of 25% from a 2021
base year.
• We will set a long term SBTi Net Zero Carbon target for
verification before the end of 2023.
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Impact on Financial Planning and Capital Expenditure
Each of the priority risks and opportunities was assigned
an owner to collect relevant data required to financially
quantify and identify any key knowledge gaps. Financial
quantification of the risks deemed significant to business
was reviewed during the year. Following quantification, the
risks and opportunities were sorted into categories of
either minor, moderate or major reflecting Redrow’s
internal impact scale. This financial risk range
categorisation can be seen on the Scenario Analysis
Outcomes Table on page 110.
The impact of climate-related issues on the financial
planning process of the Company falls within the remit of
the Board. The scenario analysis has provided a deeper
understanding of the impact of climate-related risks and
opportunities on our business strategy and financial
planning. Whilst the financial quantification is not disclosed
within the TCFD Report this year, the financial risk level
categorisations, as used in our qualitative analysis, have
been reported to the Board through the Governance
structures to assist with financial planning and strategic
decisions.
During the year, the Company engaged with investors and
lenders to further understand how an organisation’s
management of ESG risks, including those associated with
climate-change, influences their capital allocation policies.
Feedback was provided to the Board that businesses are
increasingly being assessed by such stakeholders on their
risk exposure and management of climate-related issues as
part of informing investment decisions therefore having a
strong risk management framework around climate-related
risks is crucial to ensuring capital is not restricted on this
basis.
Climate-related matters are considered when reviewing
and guiding strategy and form an integral part of the
'Managing Resources' strand of the Building Responsibly
theme forming part of the Company's overall strategy. Such
matters are also considered as part of major plans of
action, setting annual budgets and as part of the selection
criteria to measure the performance of the Company.
Regarding major capital expenditure, in relation to the
Company’s business this comes only in the form of working
capital i.e. land. Future climate-related risks relating to such
capital expenditure, such as building regulations, planning
and flood risk, are embedded into the land appraisal
process considered by the Board. The Company has no
plans for any form of divestitures of its strategic land
assets.
The Placemaking and Sustainability Committee has given
consideration to the actions required by the Company and
its partner supply chain to allow the Company to meet its
SBTi commitments, including having regard to the
operational costs associated with the carbon reduction
initiatives in the context of meeting the SBTi targets and
associated impact on revenue.
We plan to conduct further research to better understand
the deeper layers of our product supply chain, to assess if
physical risks exist from climate change to our raw material
supplies and the location of manufacturing sites.
For further detail of how climate-related issues are
considered by the Board in the context of guiding strategy,
see page 50 of the Operating Review.
Scenario Analysis
Last year was the first year that we performed climate
scenario analysis and this has been kept under review
during the year. Redrow aligned the investigation with
existing scenario narratives including Representative
Concentration Pathways (RCPs) 1,2,3 and Shared
Socioeconomic Pathways (SSPs) 4 has investigated
climate-related risks and opportunities in 2025, 2030 and
2050 under three of these scenarios as shown in the table
opposite. These time intervals were chosen to align with
other major milestones including the introduction of the
Future Homes Standard building regulations in 2025, the
Near-term Science Based Target year in 2030 and Net Zero
carbon ambitions by 2050 at the latest. These time frames
and scenario narratives remain appropriate and have not
changed for 2023. For a conceptualisation of Redrow’s
operating context under each of the three scenarios, see
pages 117 to 118 of the 2022 Annual Report.
S C E N A R I O N A M E
Early Transition
D E S C R I P T I O N O F
T H E S C E N A R I O
World shifts gradually
but pervasively to a
more sustainable
path. CO2 emissions
are cut to net zero
around 2050,
consistent with a
<2°C scenario.
W H Y C H O S E N ?
R C P
S S P
SSP1: Sustainability
– taking the green
road
2.6 – low emissions
scenario
Expected warming:
1.6°C (0.9-2.3) change
in temperature by
2081-2100
Chosen as it
evidences meeting
the TCFD’s
requirement to
consider a below 2°C
warming scenario,
and highlights the
different transition
risks and
opportunities.
1
2
3
4
https://www.ipcc-data.org/guidelines/pages/glossary/glossary_r.html
https://www.metoffice.gov.uk/binaries/content/assets/metofficegovuk/pdf/research/ukcp/ukcp18-guidance---representative-concentration-pathways.pdf
https://link.springer.com/article/10.1007/s10584-011-0148-z
https://www.sciencedirect.com/science/article/pii/S0959378016300681
108
W H Y C H O S E N ?
R C P
S S P
Chosen as it further
provides a view on
transition risks in a
longer time horizon
than the early
transition.
2.6 – low emissions
scenario
Expected warming:
1.6°C change in
temperature by
2081-2100
SSP1/SSP2:
Sustainability – taking
the green road/
middle of the road
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SSPs 2-5: Middle of
the road/fossil fuelled
development
8.5 – high emissions
scenario
Expected warming:
4.3°C (3.2-5.4) change
in temperature by
2081-2100
Chosen as it assumes
insufficient mitigating
actions are
undertaken, therefore
meets the TCFD's
recommendation to
consider a scenario
with increased
physical climate-
related risks.
S C E N A R I O N A M E
Late Transition
Hot House
D E S C R I P T I O N O F
T H E S C E N A R I O
The world shifts
suddenly to a more
sustainable path to
keep within
environmental
boundaries.
Governments make
dramatic policy
interventions to
compensate for a late
start.
CO2 emissions are cut
to net zero around
2075, consistent with
a < 2°C scenario.
Social, economic and
technological trends
do not shift markedly
from historical
patterns. A
fragmented and
insufficient global
response to climate
change.
CO2 emissions triple
by 2075, highlighting
increased physical
climate-related risks,
which are increasingly
impactful in the
long-term horizon.
To understand how resilient our strategy is to climate-
related risks and opportunities, Redrow considered how
each priority risk and opportunity would evolve under the
three scenarios, developing a qualitative description and
quantitative impact for each time frame, with the financial
risk range categorisation shown in Scenario Analysis
Outcomes table. The financial impact is disclosed as minor,
moderate or major reflecting Redrow’s internal impact
scale. This analysis considered:
• key input assumptions based on Redrow’s scenario
narratives and planned growth to 2050 (including
assumptions around policy changes, energy mix,
commodity prices);
• internal company data including accurate costs for
previous work, and quantification research for known
regulation changes; and
• external supporting data as required including price
forecasts.
These were further aligned with scenarios developed by
the Network for Greening the Financial System ('NGFS') to
ensure credible and scientific data is used to determine the
size and scope of climate-related risks identified.
As a result of the scenario analysis, Redrow has identified
that it is most exposed to transitional risks, such as
increased building regulations, planning requirements and
regulatory financial penalties for carbon emissions.
However, due to management actions currently
undertaken, such as use of air source heat pumps and
underfloor heating as standard, these are suspected to be
less impactful. The physical risks of climate change are
likely to be less impactful in the timeframes underpinning
the scenario analysis however as described on pages 105
to 106 we have begun looking into future impacts on our
properties to ensure our strategy remains flexible and
resilient. We believe that, with the management actions in
place as outlined on pages 106 to 107, the Group's strategy
remains resilient to climate-related risks and opportunities
under the three scenarios.
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S C E N A R I O A N A LYS I S O U TC O M E S
C AT E G O RY
S U B
C AT E G O RY
C O N C I S E
D E S C R I P T I O N
Transition
Regulation
Transition
Regulation
Impact of new building
regulations and planning
requirements in
response to further
climate change impacts.
Introduction of regulatory
financial penalties for
carbon emissions.
2 02 5
2 0 3 0
2 0 5 0
2 02 5
2 0 3 0
2 0 5 0
2 02 5
2 0 3 0
2 0 5 0
S C E N A R I O 1 : E A R LY T R A N S I T I O N
S C E N A R I O 2 : L AT E T R A N S I T I O N
S C E N A R I O 3 : H OT H O U S E
Significant cohesive policy action to lower resource
intensity. Impact of new regulations and more rigorous
building regulations in response to further climate
change impacts.
Sudden severe policy response to compensate for late
start.
No significant regulation likely, wide regional disparities
possible in the cost of bringing product to the market.
Gradual increase in carbon prices through the orderly
transition to a low carbon economy.
Significant disruptive increase in carbon prices after
2030.
Continued low cost of carbon.
Transition
Market
Volatility in the energy
market.
Likely to have higher energy costs, but not necessarily
more volatility.
Significant cost increases with sudden and disruptive
changes.
No significant increase in energy costs.
Transition
Market
Increasing demand on
the national electricity
grid.
National infrastructure keeps pace with growing
demand for low carbon electricity so the cost of
electrical infrastructure does not increase.
Likelihood of higher costs for developers early in the
scenario as national infrastructure lags, but later in the
scenario there is investment in the national
infrastructure and less investment required by Redrow.
Continual increase in costs for developers as national
infrastructure lags behind the demand for low-carbon
energy for Redrow’s homes.
Physical
Acute
Increasing frequency of
extreme weather events.
Low likelihood of increasing frequency of extreme
weather events in the UK before 2050.
Low likelihood of increasing frequency of extreme
weather events in the UK before 2050.
Higher likelihood of increasing frequency of extreme
weather events in the UK before 2050.
Opportunity
Market
Attracting & retaining
employees through
climate change
credentials.
As the economy transitions early, limited competitive
advantage in having strong ESG credentials. There will
be a skills shortage in the market. This makes it difficult
to attract and retrain new workforce, resulting in
additional cost for recruitment early in the transition.
In the short term, having strong ESG credentials are key
to attracting and retaining people but as the transition
occurs later in the scenario, ESG becomes less of a
differentiating factor.
Strong ESG credentials are a key market differentiator
under this scenario, but again there may be lack of skills
in the market.
Opportunity
Reputation
Customer preference for
low-carbon homes in
sustainable places.
Significant impact driven by consumer education,
demands and behaviours.
Significant impact beginning in 2030 driven by
consumer education, demands and behaviours.
Some eco-conscious consumers but this is not a key
driver of sales, but their is added value from Redrow’s
approach to sustainability.
Financial Impact Key:
Minor
Moderate
Major
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3 . R I S K M A N AG E M E N T
Integration of Climate-Related Risks
The focus of this report is to refine, define and quantify
climate-related risks and opportunities. As we gain greater
insight into future risks, and when they become
increasingly likely to impact the business, they are
absorbed into business-as-usual operations and monitored
and mitigated over time.
Process for Climate Risk Management
A comprehensive risk register is maintained at Group level
covering all high-level risks across all aspects of the
business. The climate-related risk management process is
integrated into the overall risk management framework with
climate-related risks having a specific section within the
risk register and feature as appropriate within other
sections of the risk register, for example Sustainability and
Health, Safety and Environment. Each section of the risk
register has a Risk Owner who is either a member of the
Executive Management Team or a Group Functional
Director or Head. For each high-level risk, there are
prevent and detect controls in place which are reviewed by
the Risk Owners bi-annually and by the operating divisions
and Group Functional Directors or other Group Functional
Heads as part of the formal annual review. More
information can be found in the Risk Management section
of the Strategic Report on pages 88 to 99.
The climate scenario analysis and financial quantification
has provided detailed assessment of risks and
opportunities against the three chosen scenarios. This has
provided a greater understanding of the climate-related
risks and has allowed them to be prioritised based on
potential impact.
At a divisional-level, climate-related issues with potential to
impact the operational performance are reported monthly
in respect of divisional issues and on a development-by-
development basis at the divisional board meeting.
The Group has an effective Environmental Management
System in place which is overseen and managed by the
Group HS&E Governance Manager and Group
Environmental Manager. As part of our system, we have an
Environmental Aspects and Impact Register and an
Environmental Risk and Opportunity Register. These allow
us to determine high risk areas in our environmental impact
and focus the business on the areas of highest need
through management control actions and measurements to
drive improved performance. Both registers are monitored
through cross departmental collaboration annually or as
required following changes to legislation or changes to
business operation/process. The Group’s Land, Technical,
Commercial and Sustainability teams continuously monitor
developments in regulation and legislation and engage at
high level within the industry to maintain currency and to
provide input to policy direction. This information is
disseminated to the Executive Management Team and the
Main Board in quarterly reports. Appropriate solutions to
meet climate change requirements are identified,
evaluated, and where appropriate, employed in future-
proofing product specifications.
The development and implementation of Redrow’s robust
sustainability strategy ensures we meet our objectives and
allows us to recognise and address key climate-related
risks and opportunities. Our current strategy has been in
place since 2018 and was reviewed and refreshed in 2023
as part of a materiality assessment. The targets set within it
are recorded, monitored, and discussed annually by the
Executive Management Team and presented to the
Placemaking and Sustainability Committee.
To deliver our sustainability strategy appropriate actions
are incorporated into the businesses operational
framework (see page 266), and our policy and procedures.
An engagement strategy is developed to ensure that all
appropriate business functions are aware of their roles and
responsibilities.
The Group has a clear site acquisition strategy. All new site
acquisitions follow robust procedures which includes
scrutiny of all environmental risks and opportunities. As a
key part of our acquisition risk mitigation procedure each
site is reviewed taking into account the detail in specific
ecology, air quality, land contamination, flood risk and
mitigation and landscape and visual impact surveys. Our
authorisation process also robustly scrutinises specific
local environmental issues for examples Protected Sites
such as Special Protected Areas and potential nitrate and
phosphate issues. As part of our Operational framework,
we have set a target to achieve a minimum 10% net gain for
biodiversity on every new planning application from
November 2023. This enables climate resilience and
informs the design of our new developments.
All risks and opportunities which are identified as being
pertinent to the business, including climate-related,
environmental, and sustainability issues are reported as
follows in line with the governance structure:
• monthly to the Executive Management Team;
• seven times per year to the Main Board;
• three times per year to the Placemaking and
Sustainability Committee;
• twice per year to the Audit Committee; and
• twice per year to the Group Health, Safety and
Environment Leadership Committee.
Reports include those from divisional Board meetings and
from Group specialist functions within the business such as
Sustainability, Commercial, Construction, Finance,
Assurance, Health, Safety and Environment, Human
Resources, Sales & Marketing and Technical.
4 . M E T R I C S & TA R G E T S
Metrics
In the Non-Financial Performance section and throughout
this report we disclose metrics that relate to the key
environmental and climate themes of our Sustainability
Strategy: energy, carbon, waste, water, biodiversity. These
include:
• Group GHG emissions Scope 1 and 2
• Group GHG emissions Scope 3
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• Total GHG emissions per 100m2 of build
• Total scope 3 GHG emissions per 100m2 of build
• Total energy and fuel consumption by source
• % of electricity procured from renewable sources
• Tonnes of construction waste per 100m2 build
• % of waste diverted from landfill
• Water use per 100m2 build
• % of timber certified
• Average Standard Assessment Procedure (SAP) rating
• Average Energy Performance Certificate (EPC) rating
• Average Dwelling Emission Rate (DER)
These metrics, along with historical outputs and
descriptions of the calculation methodologies, can be
found within the ESG Scorecard on page 252.
Report) Regulations 2013 and is reported in line with the
GHG Protocol: A Corporate Accounting and Reporting
Standard. Scope 3 emissions are calculated using the ‘WRI/
WBCSD GHG Protocol – A Corporate Accounting and
Reporting Standard’.
The Scope 3 emissions cover purchased goods & services,
capital goods, fuel and energy related activities, upstream
transport and distribution, waste generated in operations,
and end-of-life treatment of sold products categories as
reported on a market-basis. This year we have reported
externally verified Scope 3 data for the first time, up to
FY2022. This supports our commitment to fully disclose
our complete carbon footprint. In future years we intend to
align our Scope 3 verified data reporting with our financial
year reporting by further improving the complex data
collection requirements needed for Scope 3 accounting.
Targets
We have further improved our Scope 3 data and emissions
profiling to improve our understanding of the cost to
implement Scope 3 carbon reductions. In the future this
understanding of cost will help support the development of
an internal cost of carbon.
We are committed to reducing our environmental impact
and we aim to continually reduce the energy and water
consumption, carbon emissions and waste generated from
our operations and ultimately to achieve net zero carbon
by 2050 at the latest.
Greenhouse Gas Emissions
Greenhouse Gas (GHG) emissions data for Scope 1, 2 and 3
are detailed on page 195 of this report. Scope 1 and 2
disclosure includes all the emission sources required under
the Companies Act 2006 (Strategic Report and Directors’
A description of the KPIs used to assess progress against
the targets used to manage climate-related risks and
opportunities and related calculations can be found from
page 252 within the ESG Scorecard.
We have set the following targets to manage our climate-
related risks and opportunities:
T Y P E O F TA R G E T
D E S C R I P T I O N
SBTi verified commitments
Reduce our absolute scope 1 and 2 GHG emissions 42% by 2030 (from a 2021 base
year)
Reduce our absolute scope 3 GHG emissions 25% by 2030 (from a 2021 base year)
LTIP performance targets 1
LTIP 2022: reduce Scope 1 and Scope 2 greenhouse gas emissions by 20.7% by
financial year ending 2025
LTIP 2023: reduce Scope 1 and Scope 2 greenhouse gas emissions by 37.3% by
financial year ending 2026
Other 2
Purchase 100% REGO-backed renewable electricity for all operations by the end of
2024
95% + of construction waste diverted from landfill
Reduce construction waste intensity by 10% by end of FY25 (from a 2021 baseline)
1
2
These are the maximum vesting targets and are with reference to a baseline year of 2020/21 (tCO2e 16,099) and have been set in the context of meeting the 1.5 degree
SBTi target
Progress against these can be found within the ESG Scorecard from page 252
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S.172(1) statement
S.172(1) STATEMENT
In line with Section 172(1) of the Companies Act 2006, the Directors of the Company must act in a way which they
consider, in good faith, would most likely promote the success of the Company for the benefit of its members as a whole,
and in doing so must have regard to a number of other key matters. There must therefore be a careful balance of
sometimes competing interests of different stakeholder groups, and it is the duty of the Directors to act in such a way
that should promote the long-term success of the Company as a whole.
S E C T I O N
O F T H E
C O M PA N I E S AC T
2 0 0 6
K E Y M AT T E R O F
W H I C H T H E
B OA R D M U S T
H AV E R E G A R D
H O W T H E B OA R D H A S
R E G A R D TO T H E K E Y M AT T E R
Section 172(1)(f)
Acting fairly
between
members of the
Company
The Directors have regard to the need to act fairly between members of
the Company, aiming to understand their views and act in their best
interests. The ownership of the Company follows a ‘one share, one vote’
structure, which assists with promoting parity in shareholder rights. The
Board ensures that there is fair and equal dissemination of information to
all shareholders and has a dedicated investors section of the Company’s
website which is available to all shareholders. This provides easy access
to RNS announcements, key financial dates, dividend details and reports
and publications. All members are invited to attend the Annual General
Meetings of the Company, offering an opportunity for members of any size
shareholding to have a conversation with, and ask questions to, each of
the Directors. Where shareholders are unable to attend the AGM in
person but would like to ask a question on the formal business of the
meeting, all shareholders are offered the opportunity to submit questions
to the Board ahead of the meeting with answers being made available to
them.
Section 172(1)(b) to
Section 172(1)(d)
Having regard to
specific
stakeholder
groups
Pages 118 to 129 identify the priorities of our key stakeholders and display
how the Company has engaged with them during the year and the impact
they have had on Board decisions.
S E C T I O N
O F T H E
C O M PA N I E S AC T
2 0 0 6
K E Y M AT T E R O F
W H I C H T H E
B OA R D M U S T
H AV E R E G A R D
Section 172(1)(a)
Likely long-term
consequences of
decisions
H O W T H E B OA R D H A S
R E G A R D TO T H E K E Y M AT T E R
Given the nature of the business, the Board takes a long-term approach to
its decision-making to ensure that the Company is able to deliver its
strategy of creating long-term sustainable value for all of our stakeholders
by developing thriving communities with high quality homes that create a
better way to live.
There has been considerable emphasis on climate reduction, resource
efficiency, use of sustainable materials, placemaking and biodiversity as
these are aspects that are key to creating a long-term sustainable
business and value to our stakeholders. See pages 26 to 65 of the
Strategic Report for an overview of the sustainability practices of the
Group.
Effective risk management systems are also imperative to understanding
the likely long-term consequences of actions. The ultimate responsibility
for the effective management of the risks the Group faces in order to
achieve its strategic and financial objectives lies with the Main Board. See
pages 88 to 99 of the Strategic Report for a description of the identified
risks, procedures for identifying risks and an explanation of how these are
being controlled or mitigated. The TCFD report, which outlines how the
Group specifically manages climate-related risks and opportunities, can
be found on page 102.
At least annually, the Board conducts an assessment of the prospects of
the Company, taking into consideration the Company’s current position
and principal risks. This year the Directors selected a three-year
timeframe over which to assess the viability of the Company. The Viability
Statement can be found on page 100 of the Strategic Report.
Section 172(1)(e)
Maintaining a
reputation for
high standards of
business
conduct
The Company has in place a Code of Conduct that acts as a guide for
employees to doing the right thing in business, focusing on the values and
behaviours deemed most important for the Group and seeking to guide
employees in their good judgement to act in the Redrow way. The
Company also has well-embedded policies and procedures in place which
assist with ensuring high standards of conduct, including in respect of the
following key areas: Health, Safety and Environment; Whistleblowing;
Anti-Bribery and Corruption; Human Rights; and Modern Slavery.
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S.172(1) statement / continued
S E C T I O N 1 7 2 (1 ) D U T Y I N AC T I O N
Decision
Context
Stakeholder
considerations
Non-stakeholder
considerations
Setting and monitoring the transition plan to net zero.
During the year, the Company received validation by the Science Based Targets initiative (SBTi)
of its Greenhouse Gas (GHG) emissions targets to reduce absolute scope 1 and 2 GHG
emissions 42% by 2030 from a 2021 base year and absolute scope 3 GHG emissions 25% within
the same timeframe. The Company is also in the process of setting of a long term net zero
carbon target and the Board has supported a number of initiatives around this.
• Employees – feedback gained from the INsight survey, the materiality assessment survey
and the designated Non-Executive Director for workforce engagement showed that working
for a responsible Company that takes its environmental responsibilities seriously is an
important factor to many employees, particularly in attracting the next generation into the
industry.
• Investors – ESG and in particular climate change is of increasing importance to investors and
we understand their want to invest in companies that are proactive in managing the risks
surrounding climate change.
• Customers – a recent survey reiterated that residents of our homes welcome the cost and
quality benefits of our energy efficiency and renewable energy features, which contributes to
the Company’s commitment to deliver ‘zero-carbon ready’ for its customers.
• Suppliers – understanding that Scope 3 emissions account for a large proportion of the
Company’s GHG emissions, we have worked hard with suppliers to support them on their
own journey of education and adaptation to ensure that the shared goal of carbon reduction
can be achieved.
• Community, Environment and Non-Governmental Organisations – being an environmentally
responsible developer is a priority for the Company and the setting of ambitious carbon
reduction targets is indicative of its commitment to the community and the environment.
• Policy Makers and Local Planning Authorities – the Company understands the impact of the
Climate Change Act and its national adaptation programmes on the business. It also ensures
that it complies with Regulations relating to carbon efficiency (such as the amendments to
Building Regulations in preparation for the Future Homes Standard).
• Landowners – have expectations about ensuring developments leave a positive legacy and
contribute to their ESG and climate objectives. The Company's purpose and track record
aligns with their expectations ensuring that we remain a developer of choice.
• Long-term consequences – carbon emissions are adversely affecting the planet and it is the
responsibility of the Company to not only reduce its own emissions but to also encourage
others over which it has influence to do the same. In setting and monitoring the transition
plan, the Board had regard to the long-term consequences of the Company as well as the
impact of those consequences on the environment.
• Maintenance of high standards of business conduct – being an environmentally responsible
developer allows us to maintain high standards of conduct which is echoed throughout our
business.
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Strategic actions
supported by the
Board
• Installation of car charging stations at divisional offices and introduction of charging stations
at our sites and customer experience suites, with targets set for 100% electric car fleet by
2025.
• Purchase renewable energy for our offices, plots, show homes, and site compounds, with a
target to achieve 100% renewable by 2025.
• Introduction of the requirement of our suppliers to provide Environmental Product
Declarations (EPDs) for their products before the end of 2024.
• Trialling of low-carbon technologies in the move to reduce emissions.
• Ensuring that sufficient resources were provided to support and educate suppliers on their
carbon footprint and reduction initiatives.
• Setting near term carbon reduction targets for the business, that are verified by the SBTi and
align with the Business Ambition of 1.5˚C.
• Establishing remuneration linked to achieving carbon reduction targets.
• Introduction of air source heat pumps as a standard for all new developments from January
2023, in advance of any planned future legislation.
Expected
outcomes
• Reduced financial and reputational risk for the Company by responding appropriately to
climate change and making the necessary adaptations to the business.
• Improved engagement and standing with stakeholders as a result of the Company
understanding the shared value placed on carbon reduction and pro-actively responding
with the net zero transition plan.
• The ability to deliver better homes and thriving communities.
• A decarbonised value chain which contributes to national and global climate goals.
Link to strategy
• In setting and monitoring the net zero transition plan, the Company is acting as a responsible
developer and Building Responsibly is a vital part of the Company’s strategy.
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Stakeholder engagement
STAKEHOLDER ENGAGEMENT
Effective communication with our stakeholders and understanding their interests and priorities is crucial to the long term
success of our business.
The Board receives regular reporting from the Executive Management Team on engagement with stakeholders, as well
as having direct engagement with stakeholders themselves. This ensures that as a business we are able to keep up with
the evolving needs of our stakeholders and adapt our practices where necessary.
Our key stakeholders, their priorities, engagement methods and impact they have on Board decisions are set out on the
following pages:
S TA K E H O LD E R G R O U P
W H Y I M P O R TA N T TO U S ?
K E Y P R I O R I T I E S O F
S TA K E H O LD E R G R O U P
I N V E S TO R S
Our investors provide funds
which aid the growth of our
business and are vital to our
future success
• Strong financial performance
• Good governance practices
• Transparency and openness
• Adopt sustainable and responsible
business practices
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E N G AG E M E N T W I T H S TA K E H O LD E R G R O U P
I M PAC T O N B OA R D D E C I S I O N S
Examples of engagement with our investors include:
• Formal results presentations immediately following
Examples of the impact of investors on the Board’s
decision making include the:
publication of the interim and final results;
• Payment of an interim dividend of 10p per share on 6
• Meetings held between the Executive Directors and
April 2023;
current and potential significant shareholders;
• Implementation of a share buyback programme to
return up to £100m to shareholders. The programme
completed on 9 January 2023 and resulted in the
Company purchasing and cancelling 21,420,175
ordinary shares of 10.5p each; and
• Proposal to pay a final dividend of 20p per share on
16 November 2023, subject to shareholder approval at
the 2023 AGM.
• Direct engagement by Nicky Dulieu with significant
shareholders to explain and obtain feedback
regarding the proposal to amend the performance
conditions of the 2022 LTIP;
• Direct engagement by senior management to
understand how an organisation’s management of
ESG risks influences their capital allocation policies;
• Regulatory reporting such as the Annual Report,
results and trading updates;
• The Annual General Meeting, at which each of the
Directors were in attendance in 2022, offering an
opportunity for shareholders to directly engage with
the Board. Where shareholders were unable to attend
the AGM in person, they were offered the opportunity
to submit questions to the Board ahead of the
meeting; and
• A dedicated investor-related section of the Company
website (providing easy access to RNS
announcements, key financial dates, dividend details,
reports and publications).
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Stakeholder engagement / continued
S TA K E H O LD E R G R O U P
W H Y I M P O R TA N T TO U S ?
K E Y P R I O R I T I E S O F
S TA K E H O LD E R G R O U P
E N G AG E M E N T W I T H S TA K E H O LD E R G R O U P
I M PAC T O N B OA R D D E C I S I O N S
E M P LOY E E S
Our employees are essential to
preserving long-term value and
Valuing People is a fundamental
part of our strategy
• Development of our people
• Good quality employment opportunities
• Transparency and openness
• Diverse and inclusive workforce
• Support in all aspects of life, not just the
work element
• Good work-life balance
• High quality health, safety and
environmental practices
• Sustainable procurement
• Strong company culture
• Flexible working opportunities
• Adopt sustainable and responsible
business practices
Examples of engagement with our employees include:
• Bi-annual workforce engagement meetings hosted by
our designated Non-Executive Director for workforce
engagement, Nicky Dulieu;
• Employee communication via the intranet, Engage;
• Employee engagement meetings in all parts of the
business;
• Circulation of the annual INsight survey;
• Division specific communications, including regular
updates from the Managing Directors on news relating
to the division and beyond; and
• Company performance communications.
Examples of the impact of employees on the Board’s
decision making include the:
• Hosting of an annual all-employee staff conference,
held virtually to allow all office and site workers to
attend;
• Continued accreditation with the Living Wage
Foundation ensuring that the pay of every Redrow
employee is aligned with the real living hourly wage,
which takes into consideration the cost of living as
calculated by the Foundation;
• Introduction of health kiosks for employees and
sub-contract partners to access a health MOT, with
results and support shown instantly via a dedicated
app;
• Trained Mental Health First Aiders across all areas of
the business;
• Introduction of the Green Academy aimed at informing
and supporting our colleagues and their families on all
areas of sustainability; and
• Renewed annual invitation for all employees to join to
Sharesave scheme in 2023 at the full 20% share price
discount to promote share ownership.
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Stakeholder engagement / continued
S TA K E H O LD E R G R O U P
W H Y I M P O R TA N T TO U S ?
K E Y P R I O R I T I E S O F
S TA K E H O LD E R G R O U P
E N G AG E M E N T W I T H S TA K E H O LD E R G R O U P
I M PAC T O N B OA R D D E C I S I O N S
• Assistance with training and development
Examples of engagement with our suppliers include:
S U P P LI E R S
Having strong relationships with
our suppliers is important to our
long-term success and the
Board is briefed on supplier
feedback and issues on a
regular basis
opportunities
• Assistance with addressing the industry
skills shortage
• Timely payment practices
• Creation of jobs for our sub-contractors
• Safety and wellbeing of our people
• Compliance with laws and regulations
• High quality health, safety and
environmental practices
• Adopt sustainable and responsible
business practices
• Participation in workshops, delivered through our
partnership with the Supply Chain Sustainability
School, to engage with our suppliers on a number of
matters;
• Collaboration with sub-contractors on health and
safety matters and ensuring that our values on
customer service, quality, safety and sustainability are
in alignment;
• Working with our supply chain to attract new entrants
into the industry and actively supporting our sub-
contractors to train their recruits to agreed standards,
including inviting them to workshops and briefings;
• Continued engagement on ESG governance,
leadership, ownership and workplace approaches
throughout relationships with our suppliers;
• Working closely with our suppliers on environmental
sustainability as well as wider social impact; and
• Collaboration with key suppliers to find out how much
they understand about decarbonisation, what
progress they are making towards it and to
communicate the Group’s plans and requirements of
them.
Examples of engagement with landowners include:
• Engagement with landowners and proactive
monitoring of the market conditions to deliver a clear
defined strategy at both Group and divisional level;
• Continual engagement with landowners and their
representatives throughout the planning process to
keep them informed of progress and changes
required ensuring that they are brought with us
throughout the process; and
• Ongoing engagement with landowners during
protracted periods of planning promotion to ensure
that their own business needs are considered
alongside that of land management and any interim
land uses prior to development.
Examples of the impact of suppliers on the Board’s
decision making include the:
• Retained partnering with the Supply Chain School
which has granted access to thousands of online
presentations, training modules, guidance documents
and checklists with regular invites to attend
workshops and briefings;
• Working with suppliers to improve the buildability of
the units via product innovation and reviewing of new
technologies;
• Facilitation of a series of workshops for suppliers
supported by Environmental Product Declarations
experts to assist our suppliers to provide EPDs for
their products;
• Presentation from Redrow Group Commercial and
Group Sustainability of a seminar targeting
groundworkers with a focus on carbon reduction;
• Retained services of an external specialist to manage
all temporary labour requirements and processes,
including carrying out periodic audits to ensure
temporary agency workers are legally compliant and
there are no instances of modern slavery; and
• Increased use of new modular cabins to replace older
site accommodation.
Examples of the impact of landowners on the Board’s
decision making include the:
• Measurement of biodiversity on every new land
purchase and factoring this into the Group’s land
buying strategy to help the Company meet its
biodiversity net gain target;
• Reference in bid submissions to quality of the Redrow
product and the creation of legacy for landowners;
• Development of a revised Land Appraisal training
programme which was rolled out to all existing Land
teams during the year and will be incorporated into
the induction for all new Land team members going
forward;
• Monitoring of initiatives put in place to maintain strong
relationships with key landowners and promoters to
ensure that the Company remains the partner of
choice; and
• Understanding of the range of existing land uses to
ensure that the Company can tailor any proposals to
meet landowners’ needs whether that is legacy,
financial, environmental, family or business needs and
to strive for a “win-win” relationship with landowners.
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L A N D O W N E R S
The Company strives to remain
a partner of choice for
landowners and maintaining
good relationships with
landowners is essential to our
long-term success to ensure
that the Group has sufficient
land to continue to build and
grow
• Protect and enhance biodiversity
• Address the UK housing shortage
• Build a quality product and provide a great
place to live
• Create a legacy for future generations to
be proud of
• Additionality provided through social value
• To work collaboratively and in partnership
with one another to unlock schemes
• Adopt sustainable and responsible
business practices
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Stakeholder engagement / continued
S TA K E H O LD E R G R O U P
W H Y I M P O R TA N T TO U S ?
K E Y P R I O R I T I E S O F
S TA K E H O LD E R G R O U P
E N G AG E M E N T W I T H S TA K E H O LD E R G R O U P
I M PAC T O N B OA R D D E C I S I O N S
C U S TO M E R S
‘Putting our Customers First’ is
a key principle underpinning
our strategic theme of Building
Responsibly. Customers are at
the heart Redrow and are
central to its mission to creating
a better way to live
• Build a quality product and provide a great
Examples of engagement with our customers include:
place to live
• Provide excellent customer service
• Be a considerate constructor and good
neighbour
• Develop places that enhance health and
wellbeing
• Produce energy efficient homes with a
lower carbon footprint
• Mitigate for effects of climate change and
flood risk on our developments
• Face-to-face interactions and interactions via the My
Redrow platform;
• Interaction via social media and online reputation
platforms, retaining the utilisation of Crowd Control
HQ technology and Rep.com which enables over 100
colleagues to respond to verified customers on social
media;
• Personalised videos for customers ranging from
pre-appointment welcome videos to site colleagues
carrying out a walk around of the home to provide a
more visual update;
• Customer feedback via the NHBC and other surveys;
• Business benchmarking survey undertaken with
homeowners in their two year warranty period
undertaken by the Institute of Customer Service;
• Close monitoring of customer complaints and
feedback;
• Direct engagement regarding the value of the Group’s
wider offering around placemaking, community and
energy efficiency via the Customer Experience suites;
and
• Research undertaken to understand the attitude of
the general population towards energy efficiency
when considering home purchasing.
Examples of the impact of customers on the Board’s
decision making include the:
• Signing up of the self-remediation terms in March
2023 which follows on from the signing of the Fire
Safety Pledge last year;
• Enhancements to the RedSMI site manager inspection
app with geotagging and pre-completion inspection
information ensuring more data can be accessed in
real time on the portal;
• Retaining the use of the Company’s highly acclaimed
Homeowner Support portal allowing customers to
instantly report any issues, which is now used by 90%
of customers;
• Roll out of energy calculators at our Customer
Experience Suites to assist customers to realise
further cost and carbon savings;
• Integration of the fundamental principles of the New
Homes Quality Board Code of Practice into the
Group’s customer strategy, compliance, complaints
and monitoring procedures;
• Retaining the zero defects target of homes handed
over to customers with identified and unfixed issues
and monitoring of the zero defects reporting measure
within Board reports;
• Resourcing of a Homeowner Support team,
comprising experienced colleagues redeployed from
within the Group, to help ensure defects are reported
and actioned efficiently; and
• Ahead of time roll-out of Air Source Heat Pumps and
under floor heating as standard in detached homes on
all new developments, a decision made based on
research and customer listening.
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Stakeholder engagement / continued
S TA K E H O LD E R G R O U P
W H Y I M P O R TA N T TO U S ?
COMMUNITY, ENVIRONMENT
AND NON-GOVERNMENTAL
ORGANISATIONS
‘Listen to Learn’ is one of the
key Redrow 8 placemaking
principles and our ‘Nature for
People’ strategy both of which
feed into the key principle
underpinning our strategic
theme of Developing Thriving
Communities
K E Y P R I O R I T I E S O F
S TA K E H O LD E R G R O U P
• Provide affordable homes
• Mitigate for effects of climate change and
flood risk on our developments
• Protect and enhance biodiversity
• Develop places that enhance health and
wellbeing
• Create social value through the
communities we build
• Be a considerate constructor and good
neighbour
• High quality health, safety and
environmental practices
• Focus on resource efficiency and pollution
prevention
• Support with local causes and community
projects
• Create, support and invest in roles for a
range of trainee opportunities
• Adopt sustainable and responsible
business practices
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E N G AG E M E N T W I T H S TA K E H O LD E R G R O U P
I M PAC T O N B OA R D D E C I S I O N S
Examples of engagement with the community,
environment and Non-Governmental Organisations
(“NGOs”) include:
• Engagement and consultations with local communities
at an early stage to discuss matters that may inform
the development process, to enable us to design
developments that are sensitive and responsive and
foster a sense of belonging;
• Direct consultation with local wildlife organisations
which can provide a wealth of knowledge about the
local biodiversity and help influence our designs to
ensure the best outcome for nature and the
community;
• Direct engagement with NGOs within the Group’s
industry to better understand their views and
recommendations, recognising that they have the best
interests of society and environment in mind;
• Engaging directly with local schools to ensure that
green spaces and play areas are well planned and
used;
• Working with the emerging community as the
development progresses to help foster a sense of
community ownership and belonging through active
involvement of residents;
• Discussions with a variety of organisations local to our
developments, allowing us to understand what is
happening locally and enabling us to provide
donations and sponsorship for local community
projects to ensure that communities continue to
thrive;
• Working with local authorities and Registered
Providers to ensure that we provide the right mix of
affordable homes for local people; and
• Working and supporting workstreams being
developed by organisations with UK Green Building
Council to support the more sustainable built
environment.
Examples of the impact of the community, environment
and NGOs on the Board’s decision making include the:
• Setting of the target to reduce our Scope 1 and 2
emissions by 42% and our Scope 3 emissions by 25%
by 2030 in line with our verified SBTi commitments
and supporting of initiatives to enable the Company to
set a long term net zero carbon target later this year;
• Undertaking of a series of workshops to examine
site-level potential physical risks posed by climate
change under a hot-house scenario in 2050 and
beyond;
• Retaining contractor partnership with the Considerate
Constructors Scheme;
• Further trialling of low carbon technologies in excess
of current building regulations;
• Full integration of the biodiversity strategy into the
Redrow 8 assurance and post-completion audit
process;
• Procurement of Renewable Energy Guarantees of
Origin (REGO) backed electricity supplier contract for
our officers;
• Aim to procure labour and materials within a 50-mile
radius of each divisional office to support the local
communities we work in;
• Programming of a series of webinars for colleagues
with experts in different aspects of community
consultation, the first webinar being on ‘injecting
social value into community consultation’; and
• Development of internal biodiversity bite learning
sessions and the Biodiversity Net Gain Manual.
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Stakeholder engagement / continued
S TA K E H O LD E R G R O U P
W H Y I M P O R TA N T TO U S ?
K E Y P R I O R I T I E S O F
S TA K E H O LD E R G R O U P
POLICY MAKERS AND LOCAL
PLANNING AUTHORITIES
Active engagement with
governmental bodies and
regulators is important to allow
us the opportunity to have input
on matters relating to our
industry where possible and to
ensure we are able to put in
place appropriate measures to
ensure compliance with laws
and regulations
• Compliance with laws and regulations
• Ethical operations and practices
• Address the UK housing shortage
• Provide affordable homes
• Prevent pollution from our construction
activities
• Provide good quality employment
opportunities
• High quality health, safety and
environmental practices
• Mitigate for effects of climate change and
flood risk on our developments
• Produce energy efficient homes with a
lower carbon footprint
• Produce local plans and neighbourhood
plans
• Implement the National Model Design Code
• Address life critical fire safety issues
• Adopt sustainable and responsible
business practices
E N G AG E M E N T W I T H S TA K E H O LD E R G R O U P
I M PAC T O N B OA R D D E C I S I O N S
Examples of engagement mechanisms with policy
makers and local planning authorities include:
• Participation in a range of consultations affecting our
industry and practices;
• Engagement with the Department for Levelling Up,
Housing and Communities on matters including fire
safety, the National Model Design Code and the
Future Homes Standard;
• Working with the Department for Environment, Food &
Rural Affairs and Natural England to contribute to the
agenda on the mandatory biodiversity net gain
requirements for new developments and the water
and nutrient neutrality agenda;
Examples of the impact of policy makers and local
planning authorities on the Board’s decision making
include the:
• Working with the Future Homes Hub to explore how
the Future Homes Standard and other standards can
be delivered at scale to inform the consultation;
• Signing up of the self-remediation terms in March
2023 which follows on from the signing of the Fire
Safety Pledge last year;
• Supporting of initiatives and adaptations in response
to evolving regulation, including the Future Homes
Standard, the National Model Design Code and
upcoming Biodiversity Net Gain legislation; and
• Engagement with Government via our membership
• Receipt of regular updates on statutory and regulatory
developments following engagement with the
Government and regulators to enable the Board to put
in place structures to align practices with potential
future legislation.
with industry organisations such as the Home Builders
Federation and Future Homes Task Force;
• Attendance at meetings and forums to engage with
policy makers relevant to our operations;
• Government lobbying in relation to matters impacting
the housing market;
• Engagement with regulatory bodies during industry
sector visits; and
• Engagement in respect of local plan and
neighbourhood plan consultations seeking to
influence local policy on housing, design and
sustainability.
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Group non-financial information statement
GROUP NON-FINANCIAL
AND SUSTAINABILITY
INFORMATION STATEMENT
In line with Section 414CB of the Companies Act 2006, the table below sets out where key non-financial and
sustainability information can be found within this report:
R E L AT E D P O LI C I E S
AVA I L A B LE O N O U R
W E B S I T E
LO C AT I O N I N T H I S A N N UA L R E P O R T
PAG E
R E F.
R E L AT E D
P R I N C I PA L R I S K S *
Environment
Operating Review – Thriving Communities
Operating Review – Building Responsibly
Strategic Report – Task Force on Climate
Related Disclosures (TCFD)
26
42
Health and Safety/Environment
Key Supplier or Subcontractor
Failure
102
Appropriateness of Product
Strategic Report – Stakeholder Engagement
126
Sustainability
Governance Report – Placemaking and
Sustainability Report
Other Information – ESG Hub
162
262
Climate Change
Purchasing of sustainable
timber products policy
Group Health, Safety &
Environmental policy
statement
Partnering with our supply
chain
A responsible and
sustainable developer
Code of conduct
Equality, diversity and
inclusion policy
Employees
Operating Review – Valuing People
66
Attracting and Retaining Staff
Strategic Report – Stakeholder Engagement
120
Governance Report – Workforce
Engagement
Directors’ Report – Equality, Diversity and
Inclusion Policy
Other Information – ESG Hub
140
194
256
26
46
Housing Market
Health and Safety/Environment
Social
Operating Review – Thriving Communities
A responsible and
sustainable developer
Operating Review – Customers First
Strategic Report – Stakeholder Engagement
126
Attracting and Retaining Staff
Human rights policy
statement
Governance Report – Placemaking and
Sustainability Report
Other Information – ESG Hub
Partnering with our supply
chain
Responsible marketing,
advertising and sales
policy statement
162
252
Customer Service
Key Supplier or Subcontractor
Failure
Availability of Mortgage Finance
130
R E L AT E D P O L I C I E S
AVA I L A B LE O N O U R
W E B S I T E
LO C AT I O N I N T H I S A N N UA L R E P O R T
PAG E
R E F.
R E L AT E D
P R I N C I PA L R I S K S *
Human Rights
Operating Review – Valuing People
67
Attracting and Retaining Staff
Human rights policy
statement
Slavery and human
trafficking statement
Anti-Corruption and
Anti-Bribery
Code of conduct
Bribery and corruption
policy statement
Whistleblowing policy
statement
Governance Report – Whistleblowing
Governance Report – Conflicts of Interest
Audit Committee Report – Bribery Act
Business Model
Our Strategy
Code of conduct
A responsible and
sustainable developer
Strategy Spotlight
Strategic Report – Our Business Model
Corporate Governance Report – Strategy,
Purpose, Culture
Non-Financial KPIs
Strategic Report – Our Strategy
Other Information – ESG Hub
Code of conduct
A responsible and
sustainable developer
Group Health, Safety &
Environmental policy
statement
Climate-Related Financial
Disclosures
Strategic Report – Task Force on Climate
Related Disclosures (TCFD)
A responsible and
sustainable developer
Other Information – ESG Hub
Key Supplier or Subcontractor
Failure
Fraud/Uninsured Loss
Attracting and Retaining Staff
Cyber Security
All
Land Procurement
Customer Service
Attracting and Retaining Staff
Health and Safety/Environment
Planning and Regulatory
Environment
Appropriateness of Product
Climate Change
Climate Change
Sustainability
Health and Safety/Environment
Appropriateness of Product
Planning and Regulatory
Environment
139
139
154
6
10
12
138
9
252
102
252
* For full description of related principal risks, see pages 90 to 99.
The above policies are applicable to all employees within the Group and are easily accessible both internally and
externally. The principles which underpin each of the policies are embedded within the culture of the Group and any
behaviour inconsistent with these policies will be investigated and disciplinary action will be taken where warranted.
S T R AT E G I C R E P O R T A P P R OVA L
The Strategic Report outlined on pages 1 to 131 has been approved by the Board.
By order of the Board
Graham Cope
Company Secretary
15 September 2023
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Corporate governance report
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Quality corporate governance is one of
the cornerstones of a strong sustainable
business and the Board ensures that
it has an infrastructure in place which
promotes transparency, awareness,
accountability and responsibility.
Graham Cope
Company Secretary
134 Board of Directors
166 Directors' remuneration
136 Governance structure
146 Audit committee report
156 Nomination committee
report
162 Placemaking and
sustainability committee
report
report
170 Directors' remuneration
policy
180 Annual report of
remuneration
192 Directors' report
198 Statement of Directors'
responsibilities
132
D E A R S H A R E H O L D E R
Climate change
I am delighted to introduce the Corporate Governance
Report outlining the Company’s approach to corporate
governance.
We are reporting against the UK Corporate Governance
Code (2018 version) (the “Code”) for this report, which was
published by the Financial Reporting Council (“FRC”) and is
available to view at www.frc.org.uk. The Company
welcomes the launch by the FRC of the ongoing
consultation to revise the Code as we believe that the
enhancements will strengthen reporting to the benefit of
our stakeholders.
This report has been prepared and approved by the Board
and, on behalf of the Board, I confirm that during the 2023
financial year, the Company applied the principles of, and
was compliant with the provisions of, the Code other than
as outlined on page 137.
In this report, we seek to provide the opportunity for a
meaningful assessment of the quality of the Company’s
governance arrangements and the workings of our Board
as well as providing the required regulatory and statutory
assurances.
Board composition
Since the last report, Nick Hewson stepped down from the
Board on 11 November 2022 having served a nine-year
term as a Non-Executive Director of the Company.
On 1 May 2023 we welcomed Geeta Nanda as an additional
independent Non-Executive Director. Geeta Nanda is also
a member of the Audit, Remuneration, Nomination and
Placemaking and Sustainability Committees. Further details
of her appointment can be found on page 158 of the
Nomination Committee Report.
Board effectiveness
This report also discusses how the Board monitors its
effectiveness in order to ensure that it has the strength and
capability to lead the Company to continued success.
Climate change has remained a key agenda item
throughout the year with a focus on the Task Force on
Climate-Related Financial Disclosures (“TCFD”) framework
and the Climate-Related Financial Disclosures introduced
this year in section 414CB(2A) of the Companies Act 2006.
During the year the Company has also put in place a
number of initiatives to decarbonise Redrow homes and
operations and has undertaken feasibility studies to set
long-term targets for validation by SBTi.
During the year, alongside a specialist consultant, the
Company sought to further understand the physical risks
from climate change on its operating model. A research
project was conducted to explore the localised impacts of
our changing climate on the development process at four
strategic development sites. See page 105 for an overview
of this research project.
The work of the Climate Change Risk Steering Group is
reported through the Governance framework which
involved discussion and debate by the Executive
Management Team and the Placemaking and Sustainability
Committee and review and approval by the Audit
Committee. The 2023 TCFD report can be found on page
102.
Workforce engagement and culture
The Board plays a key role in setting and monitoring the
Group’s purpose, strategy and values and ensuring that
these are aligned with culture. During the year, Nicky
Dulieu, as designated Non-Executive Director for
workforce engagement, hosted two meetings with
representatives from each area of the business to obtain
employee views on a wide range of matters relating to life
at Redrow. There was a high level of participation and
debate throughout the meetings and an action plan was
presented to the Board by Nicky Dulieu following the
sessions. Further details of this workforce engagement
session, along with other engagement mechanisms, can be
found on page 140.
In line with the Code, a formal internal evaluation of the
Board and each of its Committees was carried out this year,
led by the Senior Independent Director with the assistance
of myself and the Non-Executive Chairman. This follows on
from the external evaluation carried out by Independent
Audit last year.
Annual General Meeting
Our 2023 Annual General Meeting will be held on Friday,
10 November 2023 and the Notice of Annual General
Meeting, together with Explanatory Notes, will be sent to
you separately and will be available on the Company’s
website.
Having considered the output of this year’s evaluation, the
Board considers that it continues to function effectively
and its relationships with its Committees continue to be
sound. Details of the evaluation can be found on page 158.
Graham Cope
Company Secretary
15 September 2023
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Corporate governance report / continued
BOARD OF DIRECTORS
The Board consists of our Non-Executive Chairman, Richard Akers; two Executive Directors,
Matthew Pratt and Barbara Richmond; three independent Non-Executive Directors, Nicky Dulieu,
who is the Senior Independent Director, Oliver Tant and Geeta Nanda; and our Company
Secretary, Graham Cope. The Board has an appropriate balance of skills, knowledge and
experience to allow it to create long-term sustainable value for stakeholders.
R I C H A R D A K E R S ( 6 2 )
Non-Executive Chairman
M N R P
Date of Appointment: 1 June 2021
Experience: Richard Akers was
formerly a Main Board Director of Land
Securities plc. Since retiring in 2014
from Land Securities plc he has held a
number of non-executive roles. He
currently holds the position of Senior
Independent Director of Shaftesbury
Capital plc. Until 2021, he held a role
at Barratt Developments plc, as a
Non-Executive Director, the Senior
Independent Director, Chair of the
Remuneration and Safety, Health &
Environment Committees and
Workforce Engagement Director.
Contribution and Skills: Richard Akers
has a strong career background in
property and land acquisition and
contributes extensive industry
experience to the Board.
M AT T H E W P R AT T (4 8 )
Group Chief Executive
M P
Date of Appointment: 1 April 2019
Experience: Matthew Pratt has worked
at Redrow for over 20 years. He joined
the Redrow Board in April 2019 as
Chief Operating Officer and was
promoted to Group Chief Executive
with effect from 1 July 2020. In his time
he has had various positions in a
variety of business, joining in 2003 as
a Chief Quantity Surveyor and later
became Managing Director of the
Midlands Division. In 2013, Matthew
Pratt was appointed as a Regional
Chief Executive and became a
member of the Executive Management
Team.
Contribution and Skills: Matthew Pratt
has over 25 years’ experience within
134
the industry and contributes key
operational knowledge to the Board.
He trained as a quantity surveyor and
graduated with an honours degree in
Building from Nottingham Trent
University.
B A R B A R A R I C H M O N D ( 6 3 )
Group Finance Director
M
Date of Appointment: 18 January 2010
Experience: Barbara Richmond has a
proven track record, with over 25
years’ experience as Group Finance
Director at a number of UK listed
companies including Inchcape plc,
Croda International plc and Whessoe
plc. She was appointed a Non-
Executive Director of Lonza Group Ltd
in 2014 and became Chair of their
Audit and Compliance Committee in
May 2022.
Contribution and Skills: Barbara
Richmond has a strong manufacturing
and retail background and contributes
key financial and major acquisition and
disposals knowledge to the Board.
She is a Fellow of the Institute of
Chartered Accountants in England and
Wales and a graduate of the University
of Manchester.
G R A H A M C O P E ( 5 9 )
Company Secretary
M
Date of Appointment: 1 January 2003
Experience: Graham Cope joined
Redrow as Head of Legal in November
2002 and was appointed Company
Secretary two months later. Graham
Cope has 30 years’ experience in the
housebuilding sector, either working
in-house or for house builder clients in
private practice.
Contribution and Skills: Graham Cope
is a highly experienced solicitor having
qualified in 1989 and is a member of
the Law Society. He has a strong
background in the housebuilding
sector and provides valuable advice
on governance, corporate conduct and
business ethics.
N I C K Y D U LI E U ( 5 9 )
Senior Independent Director
M A N R
Date of Appointment: 6 November
2019
Experience: Nicky Dulieu is currently a
Non-Executive Director and Senior
Independent Director of The Unite
Group plc (where she is also Chair of
the Remuneration Committee), WH
Smith plc (where she is also Chair of
the Audit Committee) and John Lewis
Partnership plc (where she is also
Chair of the Audit and Risk
Committee). She is also a Commercial
Board member of the Royal
Horticultural Society. Nicky Dulieu
trained as an accountant with Marks &
Spencer Group plc and held various
strategic and financial roles within the
company over a 23-year period.
Following this, Nicky Dulieu was
appointed to the Board of Hobbs
Limited and became Chief Executive
from 2008 until 2014.
Contribution and Skills: Nicky Dulieu
is a Fellow member of the Association
of Chartered Certified Accountants
with strong Non-Executive Director
experience. She has extensive
knowledge of retailing and customer
service and brings valuable
remuneration and audit experience
from her current and past external
appointments.
Redrow Board of Directors at Kings Moat Garden Village, Chester, Cheshire
Left to right: Oliver Tant, Geeta Nanda, Matthew Pratt, Barbara Richmond, Richard Akers, Nicky Dulieu and Graham Cope.
O LI V E R TA N T ( 6 2 )
Non-Executive Director
M A N R
Date of Appointment: 1 February 2022
Experience: Oliver Tant served as
Chief Financial Officer of Imperial
Brands PLC until 2021 where he was
responsible for finance, treasury,
investor relations, procurement and
information technology. Prior to this
role, he held several senior positions
in a 32-year career at KPMG, including
Vice Chairman, Global Managing
Director (Financial Advisory and
Private Equity Divisions) and Head of
UK Audit. Oliver was also a Non-
Executive Director of both the UK and
German Boards of KPMG. He is
currently a Non-Executive Director
and Chair of the Audit Committee of
B&M European Value Retail S.A. and
he previously served as Audit Chair of
the Royal Hospital for Neuro-Disability.
Contribution and Skills: Oliver Tant is
a Chartered Accountant with the
Institute of Chartered Accountants of
Scotland and the Institute of Chartered
Accountants in England and Wales and
has a Joint 1st Class Honours degree
in Economics and Business
Economics. He brings to the Board
strong financial and audit experience
as well as broader commercial and
operational expertise.
G E E TA N A N DA ( 5 8 )
Non-Executive Director
M A N R P
Reit plc and a member of the DLUHC
older person taskforce and the Princes
Homeward National Expert panel to
end homelessness.
Contribution and Skills: Geeta Nanda
brings to the Board strong housing
experience as well as broader
commercial and operational expertise.
Date of Appointment: 1 May 2023
COMMITTEE MEMBERSHIP
Experience: Geeta Nanda is a long-
serving chief executive who has spent
almost the entirety of her career in
housing associations and the
associated policy development arena
and is currently the Chief Executive of
Metropolitan Thames Valley Housing
Association, which is one of the
largest housing associations in the
country with around 60,000 homes.
She is also the former Chair of the G15,
the group representing London's
largest housing associations. In
addition, Geeta Nanda is currently a
Non-Executive Director of The PRS
M
Main Board
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Audit Committee
Nomination Committee
Remuneration Committee
Placemaking and Sustainability
Committee
BOARD EXPERIENCE
Finance
Property
Operational
Sustainability and Climate Change
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R E D ROW G OV E R N A N C E S TRUC TU R E
M A I N B OA R D
NON -EXECUTIVE CHAIRMAN
GROUP CHIEF EXECUTIVE AND
GROUP FINANCE DIRECTOR
NON -EXECUTIVE DIRECTORS
(INCLUDING SENIOR INDEPENDENT DIRECTOR)
Responsible for leading the Board
Responsible for day-to-day
Responsible for providing
and ensuring its effectiveness with a
operation of the business and
constructive challenge and helping
key focus of the strategic
performance of the Company.
to develop proposals on strategy.
development of the business.
B OA R D CO M M IT TE E S
AUDIT
NOMINATION
Provides independent scrutiny of the Company’s financial
Identifies and makes recommendations concerning the
and non-financial performance, risks and audit functions.
composition of the Board and that of its Committees.
PLACEMAKING AND SUSTAINABILITY
REMUNERATION
Promotes high environmental and placemaking standards
Aims to attract and retain good management and to
in line with the Group's strategy.
incentivise them to create shareholder value.
E X E C UTI V E M A N AG E M E NT TE A M
GROUP CHIEF EXECUTIVE
Responsible for the operational management of the Group and the implementation of strategic plans.
GROUP FINANCE DIRECTOR
COMPANY SECRETARY
Responsible for the financial management of the Group in
Responsible for governance structures and mechanisms,
its broadest sense and maintaining effective
corporate conduct and is the primary source of advice on
communications with shareholders.
the conduct of the business.
REGIONAL CHIEF EXECUTIVES
GROUP COMMUNITIES DIRECTOR
Responsible for the operational management of the
Responsible for placemaking and the sustainability
Divisions and reporting to the Board on this.
strategy and ensuring that these functions align with the
Group’s long term objectives and targets.
GROUP HR DIRECTOR
GROUP CUSTOMER & MARKETING DIRECTOR
Responsible for implementing the strategy on people,
Responsible for the overall customer experience, including
ensuring that the management of talent and culture is
marketing and sales strategy, and developing the Group’s
aligned with the Group’s longer-term goals.
reputation via strategic communications and customer service.
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I N T R O D U C T I O N
This report sets out the Company’s compliance with the
Code issued by the FRC and describes how the
governance framework is applied by the Company.
G OV E R N A N C E S T R U C T U R E
Governance is a key priority of the Board and the
governance structure is set out in the diagram opposite.
Each component within the structure is governed by a
particular set of rules, whether it is the Redrow employee
handbook, the Code of Conduct, the policies and
procedures manuals, Articles of Association and/or the
Committee terms of reference. Each of these documents
are regularly reviewed and is updated in line with best
practice and legislative or regulatory changes.
C O M P L I A N C E W I T H T H E U K C O R P O R AT E
G OV E R N A N C E C O D E
The Directors have considered the contents and
requirements of the Code and confirm that throughout the
year ended 2 July 2023 the Company has been fully
compliant with the principles and provisions of the Code,
other than the partial compliance with provision 38. As
explained in the 2022 Annual Report, the pension
contribution rate for our Group Finance Director was
aligned with that of our wider workforce on 1 January 2023,
at a rate of 10% of salary. Prior to this, the Group Finance
Director’s rate was 20% of salary in line with the Directors’
Remuneration Policy which was approved by shareholders
with a 96.94% majority at the 2021 AGM.
B OA R D LE A D E R S H I P A N D C O M PA N Y P U R P O S E
relevant management bodies in order to ensure that the
Group is operating efficiently and effectively.
In order to ensure that the members of the Board fulfil their
statutory duties as Directors, there is a formal schedule of
matters reserved specifically for the Board’s decisions. The
matters reserved include:
• approval of any significant changes in accounting
policies or practices;
• any changes relating to capital structure and approval of
treasury policies;
• ensuring the maintenance of a sound system of
governance, internal control and risk management;
• authorising conflicts of interest where permitted by the
Company’s Articles of Association;
• assessing the prospects and viability of the Group,
including measurement of key performance indicators;
• assessing and monitoring culture in alignment with
purpose, values and strategy;
• approval of corporate acquisitions or disposals,
significant land purchases or contracts;
• changes to the size, structure and composition of the
Board;
• approval of significant policies, including the Group’s
Health, Safety and Environmental policy;
• reviewing of overall corporate governance
arrangements;
• monitoring the whistleblowing programme and reviewing
concerns raised through the whistleblowing procedure;
• ensuring a satisfactory dialogue with key stakeholders;
R O L E O F T H E B OA R D
and
The Board sets the Group’s strategy and oversees and
monitors risk management, principal risks, internal controls
and the viability of the Company. The Board is responsible
for putting in place the strategic plans for the Group and
providing the leadership required in order to achieve its
vision and goals.
There are matters which the Board delegates to
Committees, the Executive Management Team and other
• appointment and removal of the Company Secretary.
Long-term performance and shareholder value relies on
high quality corporate governance and the Board is
responsible for maintaining strong governance practices
and regularly reviewing the Group’s governance structure
as illustrated on the page opposite.
LE A D E R S H I P CO M M IT TE E S
B OA R D M E E T I N G AT T E N DA N C E
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GROUP HEALTH, SAFETY AND ENVIRONMENTAL
FIRE SAFETY
Responsible for developing and monitoring the Group’s
Responsible for managing the Group’s approach to funding
approach to health and safety and environmental
the remediation of life critical fire safety issues on buildings
sustainability matters.
over 11m in which the Group was involved going back 30
years in line with its commitment.
DIVISIONS
GROUP
Build | Commercial | Customer Services
Finance | Land | Sales | Technical
Commercial | Finance | HS&E | HR | IT
Legal | Marketing | Technical | Sustainability
Our Homes Divisions are comprised of the above departments
which work together to deliver the Group’s strategy.
The above departments support the Divisions to contribute
to the successful operation of the business.
136
NAME
Richard Akers
Matthew Pratt
Barbara Richmond
Nick Hewson1
Nicky Dulieu
Oliver Tant
Geeta Nanda2
ROLE
ATTENDANCE AT MEETINGS
Non-Executive Chairman
Group Chief Executive
Group Finance Director
Former Senior Independent Director
Senior Independent Director
Non-Executive Director
Non-Executive Director
9/9
9/9
9/9
3/3
9/9
9/9
1/1
1
Nick Hewson stepped down from the Board on 11 November 2022 and attended all meetings held from the beginning of the 2023 financial year to the date he left the
Board.
2 Geeta Nanda was appointed as Non-Executive Director on 1 May 2023 and attended the one meeting held from her appointment date to the end of the 2023 financial
year.
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B OA R D M E E T I N G S
The Board meets regularly and frequently, not less than
seven times during the year and maintains a close dialogue
between meetings. During the year Board meetings have
predominantly been held in person and the Board have
carried out in-person site visits, accompanied by the local
management team.
Board packs are distributed sufficiently in advance of the
meetings to allow adequate time for review to enable
informed debate and challenge at meetings and include
key strategic, operational and financial information.
Where a Director is unable to attend a meeting, they are
encouraged to discuss any issues arising with the Non-
Executive Chairman or Group Chief Executive as
appropriate. If a Director has a concern about the running
of the business, the minutes should accurately reflect this.
Should any Director resign from their position as a result of
unresolved concerns in the Company, they are requested
to submit a written statement to the Non-Executive
Chairman outlining their concerns for circulation to the
Board. There were no statements received of this nature
during the year. Attendance by individual Directors at
Board meetings is set out on page 137.
P R O F E S S I O N A L D E V E LO P M E N T
The Company Secretary and Non-Executive Chairman
regularly review the developmental needs of the Board,
both as a whole and for individual directors, to ensure that
each Director is effective in adding to Board discussion,
debate and decision-making and to allow them to continue
to fulfil their role effectively on the Committees.
The Board receives regular briefings from those
responsible for key Group disciplines. In addition, the
Board maintains close working relationships with the
Executive Management Team and the divisional
management teams.
During the year, formal appraisals of the Group Chief
Executive, Group Finance Director and Non-Executive
Directors were undertaken by the Non-Executive Chairman
together with the Senior Independent Director. The
Non-Executive Chairman had an annual appraisal
conducted by the Senior Independent Director.
K P I A S S E S S M E N T A N D R I S K M A N AG E M E N T
The Board has the overall responsibility for setting the key
performance indicators and selecting the appropriate form
of measurement to allow an objective assessment of the
Group’s performance. The Board also sets appropriate
targets against each indicator and ensures timely and
accurate measurements against each identified
performance indicator. See page 9 for further details of the
key performance indicators of the Group.
The ultimate responsibility for the effective management of
the risks faced by the Group in order to achieve its
strategic and financial objectives lies with the Board. It is
vital to the long-term sustainability of the Group that strong
risk management mechanisms are in place. The Board
carries out a robust assessment of the principal risks facing
the Company, including those that would threaten its
business model, future performance, solvency or liquidity.
Details of the Group’s risk management processes,
including the Board’s robust assessment of the Group’s
emerging and principal risks, key controls and mitigating
strategies can be found on pages 88 to 99.
S T R AT E GY, P U R P O S E A N D C U LT U R E
Setting and monitoring the Group’s purpose, values and
strategy and ensuring that these are aligned with culture is
a key role of the Board. Engagement with stakeholders,
and understanding the key matters which are of priority to
them, has formed the basis of the Group’s business
strategy and purpose and can be seen in the three themes
of Developing Thriving Communities, Building Responsibly
and Valuing People.
All new Directors must undertake a formal and
comprehensive induction programme which is coordinated
by the Company Secretary and the Non-Executive
Chairman. The programme for the Non-Executive Directors
is specifically designed to encompass the full breadth of
the business and includes visits to operating businesses.
Our purpose is to create a better way for people to live.
This is supported by our strategy of creating long-term
sustainable value for all of our stakeholders by developing
thriving communities with high quality homes that provide a
better way to live. The messaging regarding the Group’s
purpose and strategy is consistent and clear.
The programme is tailored accordingly to:
• provide an understanding of their role within the
Company and the key priority areas for the Board;
• build an understanding of how the Board operates within
the structure of the Group;
• introduce key Group personnel and external advisors;
• enhance their knowledge of the Group’s strategy, culture
and business;
• provide an understanding of the financial position of the
Company; and
• if applicable, prepare the Director for Committee
memberships by additionally providing induction material
relevant to the specific committee.
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The Redrow culture is the unconscious landscape through
which colleagues think, behave and act, regardless of
whether they are working in the boardroom, at Division, at
Group or on site. Culture is embedded through the Group’s
values which gives colleagues confidence about the
established Redrow brand and innovative way of
transforming the lives of our customers by creating dream
aspirational homes with inspirational designs.
There is a strong focus on creating personal emotional
connections with customers to make them feel instantly at
home. This culture is the backdrop of life at Redrow and
colleagues are expected to apply these values in their
daily working life. There are a number of measures adopted
by the Board to assist with monitoring, assessing and
embedding culture:
1.
2.
3.
4.
5.
6.
The Board monitors the opinions of employees via the
annual INsight survey to assist with measuring how far
Redrow values are incorporated into the culture and
evaluates the level of consistency in employees’ views
of culture.
Consistent language is used in communications with
our colleagues via our intranet, Engage, which seeks
to embed cultural norms by reinforcing the strategy
and values and reiterating the behaviours and actions
which are to be encouraged.
Policies are regularly reviewed and updated to ensure
that they are in alignment with the Company’s purpose,
values and strategy.
Colleagues have access to the Redrow Brand Portal
which reinforces what Redrow stands for and provides
a single source of brand-related assets to ensure
brand consistency.
Site and Divisional visits are carried out by the Board,
which allows them to engage directly with the
workforce and obtain their views on culture within the
business.
Workforce engagement sessions carried out with
Nicky Dulieu, as designated Non-Executive Director
for workforce engagement, play an important role in
obtaining views of employees and reporting back to
the Board on key issues for the workforce.
The Board uses the feedback from the above measures to
monitor behaviours and assess their alignment with the
desired culture.
The Board is proud to have a business that is customer
focused with employees taking pride in creating a better
way to live through their contribution to providing a high
quality product and service to customers.
W H I S T L E B LO W I N G
The Group has a widely publicised Whistleblowing Policy
which enables employees and other stakeholders to raise
concerns in confidence. The Board receives reports on all
occasions when such issues are raised under this policy
and ensures that appropriate follow-up action is
undertaken.
The Whistleblowing Policy allows concerns to be raised
anonymously and includes a non-retaliation policy whereby
all concerns raised in good faith will be protected, as will
those against whom claims are made which turn out to be
unfounded. The Company provides a safeguarding
assurance for anyone raising concerns in good faith that
they will be protected regardless of the outcome of the
investigation and any reporting of retaliation shall be
treated in the same way as a whistleblowing allegation and
disciplinary action taken if necessary.
Employees are reminded of the types of unethical or
unlawful behaviours which may prompt a report to be made
under the procedure and there are a series of reporting
channels within the policy to ensure that people are
comfortable raising their concerns at some level within or
outside of the Company. The policy contains the contact
details of the Company Secretary and Audit Committee
Chair and additionally includes an independent reporting
hotline where independent and confidential advice can be
provided on whistleblowing matters.
Investigations are undertaken as quickly as possible
without affecting their quality and depth. For any non-
anonymised concern, receipt of the concern is
acknowledged and the reporting person is provided with
an indication of how the Company is proposing to deal with
the matter. The person raising the concern shall be
provided with feedback relating to the investigation,
provided that it would not breach the confidentiality of
others within the Company.
The Company Secretary maintains a record of the number
of whistleblowing reports received, along with details of
the investigations undertaken, and reports to the Board on
this. During the year, there were three incidents reported
through the whistleblowing procedure. In line with the
policy, thorough investigations were held in respect of the
reported incidents led by the Company Secretary. The
investigations into the three incidents have concluded and
were dealt with in line with the policy and the Redrow
Employee Handbook.
The Whistleblowing Policy is formally reviewed and
approved each year by the Board, with changes being
approved in June 2023.
C O N F LI C T S O F I N T E R E S T
Transparency in our business dealings is paramount and
the Board is ultimately responsible for ensuring that there
are procedures in place to ensure that conflicts of
interests, or potential conflicts of interests, are managed
effectively.
In line with the Group’s Code of Conduct, employees must
immediately inform their line manager if there is any
possibility of there being an actual or potential conflict of
interest. If conflicts can be mitigated, authorisation by way
of a Divisional board meeting must be obtained and the
Company Secretary must be informed.
Directors must disclose any actual or potential conflicts of
interest immediately to the Company Secretary and seek
formal approval from the Board.
Each Head of Department and/or Managing Directors must
make an annual Related Party Transaction and Conflict of
Interest Disclosure confirming any instances where
employees had an actual or potential conflict of interest.
The Board is satisfied that the procedures in place to deal
with conflicts of interest are sufficient and were operated
effectively during the year.
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S H A R E H O LD E R E N G AG E M E N T
Shareholder engagement is paramount to the Board and
the Directors make themselves available to meet with
significant shareholders to understand the issues that are
of most importance to them. Following any shareholder
meeting, the Board is subsequently briefed on any issues
discussed therein. During the year, the Board engaged with
shareholders through the following means:
1.
2.
3.
4.
5.
Analyst presentations – the Board undertakes formal
presentations to equity analysts immediately following
the announcement of the Company’s financial results
half-yearly. These presentations are available on the
Company’s website.
Current and potential significant shareholders
meetings – following the full year and half-yearly
results’ announcement in September 2022 and
February 2023, the Executive Directors held meetings
with current and potential significant shareholders and
feedback from these meetings was independently
collated and disseminated to the Board.
Remuneration Committee Chair engagement – prior to
the Remuneration Committee agreeing to amend the
performance conditions of the 2022 LTIP awards and
partially waive the awards granted, the Chair of the
Committee reached out to significant shareholders to
explain the rationale behind the proposal and obtain
feedback.
Senior management engagement – feedback was
provided to the Board following engagement with
significant shareholders to further understand how an
organisation’s management of ESG risks influences
their capital allocation policies.
Annual General Meeting – last year the AGM took
place at Village Hotel Chester St. David's, St. David's
Park, Ewloe, Deeside CH5 3YB on Friday 11 November
2022. All Directors attended the AGM, which allowed
them to engage directly with shareholders and their
representatives and answer any questions. The Board
provided the shareholders with the opportunity to ask
questions and engaged with them following the
meeting. If shareholders were unable to attend the
AGM but had a question to raise, the Board provided
the opportunity for shareholders to submit questions
ahead of the meeting as outlined in the Notice of
Meeting.
6.
Company website – there is a dedicated investor
related section of the Company website (redrowplc.co.
uk) providing easy access to RNS announcements, key
financial dates, dividend details, reports and
publications. The website also gives access to current
financial and corporate information.
4.
W O R K F O R C E E N G AG E M E N T
The Board believes that greater engagement with the
workforce is essential to preserving long-term value.
Valuing People is a fundamental part of the Group’s
strategy and understanding the views of employees and
140
actively encouraging their participation sits highly on the
Board’s agenda. The Company engages with employees
through the following means:
1.
Designated workforce Non-Executive Director – in line
with Provision 5 of the Code, Nicky Dulieu is the
designated Non-Executive Director for workforce
engagement. During the year, Nicky Dulieu hosted two
employee engagement sessions with representatives
from each area of the business. The group was
wide-ranging with representatives from Build, Sales,
Commercial, Technical, Land and other support
functions. There was also a good mix of employees of
different ages and at different stages of their career to
allow for a broad spectrum of voices to be heard.
2.
3.
The sessions provide the opportunity for Nicky Dulieu
to engage directly with the workforce to obtain their
views on a wide range of matters relating to life at
Redrow. One of the sessions had a dedicated section
on executive remuneration and how the executive
bonus was calculated.
There was a good level of discussion and debate
throughout the sessions and Nicky Dulieu was able to
obtain a clear understanding of the most important
issues facing employees. The Group HR Director was
also available during the sessions and was able to
share with the group which issues were under active
consideration by the Board. Following each session, an
action plan was put together and was presented to the
Board by Nicky Dulieu who issues feedback to the
employee representatives in between each bi-annual
session.
Employee communication via the intranet, Engage
– Engage is available for all employees of the
Company and is the hub for sharing news and
communications across the business. It encourages
employees to actively participate and have a voice in
decisions being made by the Company.
Employee engagement meetings – each divisional
business and Group has a team of elected
representatives who attend regular engagement
meetings. These meetings keep employees up to date
with Company news and employee health and
wellbeing initiatives and enable the representatives to
put forward the views and ideas of the department.
Each employee has access to their engagement
representative and has the opportunity to discuss
matters arising from these meetings. All meeting
materials and action plans following meetings are
made available to all employees via Engage.
INsight survey – this survey is distributed annually to
all employees by an independent third party company
and in the latest survey there was a 92% participation
rate. The feedback from employees was anonymised.
Following the results, workshops were carried out with
each team to discuss the findings and feedback was
collated by the Engagement team. Resulting from the
feedback, commitments and themes for the year were
posted on Engage with regular progress reports
posted on these.
5.
6.
7.
Share ownership through employee share plans – the
Company supports employee share ownership at all
levels as it directly aligns employee interests with
those of shareholders.
D I R E C TO R S ’ A N D O F F I C E R S ’ I N S U R A N C E
The Company has directors’ and officers’ insurance in
place which insures Directors against certain liabilities,
including legal costs.
Division specific communications – the Divisions are
encouraged to make their employees aware of the
financial and economic factors affecting their
respective Divisions and the Company as a whole.
Each Division has a dedicated section on the intranet
which is regularly updated to reflect matters directly
affecting that part of the business. Managing Directors
and Heads of Departments provide, at least quarterly,
an overview of news within the related Division and
beyond.
Company performance communications – the
Company’s intranet, Engage, is also used as a tool for
communicating factors affecting the performance of
the Company to employees to ensure that they
understand how the business is performing in the
current market. Additionally, the Group Chief Executive
circulates the results announcements and trading
updates to all employees.
The Board is satisfied that the existing employee
engagement activities are effective in understanding the
views of the workforce and feels that matters are discussed
across all levels of the business in line with its Governance
structure, including at Board level where appropriate.
Engagement mechanisms will be kept under review for
their effectiveness and will be adapted and evolved in line
with the needs of the business.
D I V I S I O N O F R E S P O N S I B I L I T I E S
T H E B OA R D
The Board currently comprises a Non-Executive Chairman,
two Executive Directors and three independent Non-
Executive Directors, one of which acts as the Senior
Independent Director.
Division of Responsibilities
The Company has separate roles for the Non-Executive
Chairman and Group Chief Executive, ensuring that there is
a clear division of responsibilities at the head of the
Company between the running of the Board and the
operational responsibility for the running of the Company’s
business, as required by the Code.
The division of responsibility and accountability between
the roles is well defined and using such a balanced
approach ensures that no one individual has unfettered
powers of decision.
Non-Executive Chairman
Richard Akers, as Non-Executive Chairman, is primarily
responsible for:
• leading the Board to ensure optimum effectiveness;
• encouraging a culture of openness and debate;
Details of how the Company invests and rewards its
workforce can be found on page 76.
• facilitating constructive board relations and effective
contributions from all Non-Executive Directors;
• ensuring that all Directors receive accurate, timely and
S TA K E H O L D E R E N G AG E M E N T
clear information;
During the 2023 evaluation of the Board, it was identified
that there was scope to develop a fuller understanding of
interactions with key stakeholders to ensure all aspects are
fully covered at Board level. As a result, it was agreed that
a stakeholder engagement matrix would be maintained by
the Board and key management personnel would be
responsible for providing a summary of ongoing actions
and engagement with each stakeholder group during the
period between the Main Board meetings. This would
ensure that stakeholders remain a regular feature of
discussions at Board level.
• taking a leading role in determining the Board’s
composition and structure;
• ensuring that effective communications are maintained
with shareholders; and
• meeting with the Non-Executive Directors without the
presence of the Executive Management Team.
Richard Akers was appointed to the Board as Chair-
Designate and independent Non-Executive Director on 1
June 2021 and was made Non-Executive Chairman on 15
September 2021.
An explanation of the engagement undertaken during the
year with the key stakeholders of the Group, including the
impact of the engagement on Board decisions, can be
found on page 118 to 129 of the Strategic Report.
S E C T I O N 1 7 2 (1 ) S TAT E M E N T
The Section 172(1) Statement of the Group, explaining how
the Directors have carried out their statutory duty within
s.172(1) of the Act, can be found on page 114 of the Strategic
Report.
Group Chief Executive
Matthew Pratt, as Group Chief Executive, is responsible for:
• operational management of the Group and leading the
Executive Management Team;
• implementing strategic plans as agreed with the Board
with the assistance of the Executive Management Team;
• ensuring that the visions and values of the Company are
properly communicated across the Group; and
• reporting on these to the Board.
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In addition to his role on the Main Board, the Group Chief
Executive is also a Member of the Placemaking and
Sustainability Committee and Executive Management
Team.
Group Finance Director
Barbara Richmond, as Group Finance Director, is
responsible for:
• the financial management of the Group and ensuring that
the strategy aligns with financial objectives;
• maintaining effective communications with shareholders;
• maintaining strong relationships with the Company’s
banks, brokers and auditors; and
• reporting on these to the Board.
In addition to her role on the Main Board, the Group
Finance Director is also a Member of the Executive
Management Team.
Senior Independent Director
In line with Provision 12 of the Code, Nicky Dulieu was
appointed as Senior Independent Director on 11 November
2022, following the retirement of Nick Hewson from the
Board. Nicky Dulieu has a wealth of experience as a
Non-Executive Director and, having been on the Board
since 2019, has a good understanding of the business. The
following additional responsibilities fall within the remit of
the Senior Independent Director:
• acting as a sounding board for the Non-Executive
Chairman and supporting him in ensuring the Board is
effective and that constructive relations are maintained;
• being available to shareholders in order to understand
their issues and concerns in order to relay them to the
Board; and
• leading the evaluation of the performance of the
Non-Executive Chairman and obtaining views from other
Directors.
Non-Executive Directors
The role of the Non-Executive Directors within the
Company is essential in order to view the Group
objectively and provide constructive challenge to the
Executive Directors and scrutinise performance. They have
a good understanding of the business and bring a range of
skills and experience to the discussions in the boardroom,
including offering specialist advice and strategic guidance.
The diversity and skills brought into the Company by the
Non-Executive Directors are crucial to developing the
strategy of the Group.
The Non-Executive Directors play a vital role in occupying
seats on the Board’s Committees and they are positioned
in such way that the Committees benefit from their
expertise and background. The Non-Executive Directors
are also key in appointing and removing Executive
Directors and ensuring that there are succession plans in
place for senior level roles. The work of the Nomination
Committee, comprising all Non-Executive Directors, can be
seen on page 157.
Company Secretary
The Company Secretary acts as secretary to the Board and
its Committees and his appointment and removal is a
matter for the Board as a whole. He is responsible for
advising the Board on all governance matters and ensuring
that there is a good flow of information to the Board,
Committees and Executive Management Team.
The Company Secretary is a member of the Executive
Management Team and all Directors have access to his
advice and services. He is responsible for governance
structures and mechanisms, corporate conduct and is the
primary source of advice on the conduct of the business.
He also plays a key role in the annual evaluation of the
Board.
In certain circumstances, Board Committees and individual
Directors may wish to take independent professional
advice in connection with their responsibilities and duties,
and, in this regard, the Company will meet the reasonable
costs and expenses incurred and the Company Secretary
will assist in arranging such advice.
B OA R D B A L A N C E A N D I N D E P E N D E N C E
The Board considers that it is of a size and has a balance of
skills, knowledge and experience that is appropriate for its
business. The Executive Management Team provides the
Board with an appropriate view of the detail of the
business, which, together with the benefit of their
significant collective experience of the UK house building
industry, enables the Board to discharge its duties and
responsibilities effectively. The Non-Executive Directors
bring a wealth of experience and understanding from
outside the Company which enables them to challenge and
help develop proposals on the Company’s strategy.
The details of the Directors’ respective experience are set
out in their biographical profiles on pages 134 to 135.
In considering the independence of each Non-Executive
Director, the Board has taken into consideration the
guidance provided by the Code. The Board considers all
Non-Executive Directors holding office during the year and
seeking re-election at the 2023 AGM to be independent in
accordance with Provision 10 of the Code, as they each:
• have not been employed by the Company or Group;
• have no material business relationship with the
Company;
• do not participate in the Company’s employee share
plans or pension scheme;
• have not received additional remuneration beyond the
director’s fee displayed on page 182 of this Annual
Report;
• have no close family ties with any of the Company’s
Directors, Executive Management Team or advisers;
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C O M P O S I T I O N O F T H E B OA R D
( E XC LU D I N G C H A I R M A N )
L E N G T H O F T E N U R E O F
N O N - E X E C U T I V E D I R E C TO R S
M A I N B OA R D BY G E N D E R
2023
2023
2023
Non Executive
Executive
3
2
One to three years
Over 3 years
2
1
Male
Female
3
3
• have no significant links with other Directors through
involvement in other companies;
• do not represent a significant shareholder; and
• have not served on the Board for more than nine years
from the date of their first appointment.
The Board believes that presently the balance of Non-
Executive and Executive Directors is effective and contains
the appropriate mix of skills and experience for the Board
to continue successfully. The composition is compliant with
Provision 11 of the Code as the ratio of independent
Non-Executive Directors to Executive Directors, excluding
the Chairman, is 3:2 (60%).
A P P O I N T M E N T S TO E X T E R N A L B OA R D S
Prior to Executive Directors and Non-Executive Directors
taking on any additional responsibility outside of the
Group, and before making new appointments to the Board,
an assessment is undertaken to determine whether this will
compromise their ability to commit sufficient time to the
Company to properly discharge their responsibilities or
create any potential conflicts.
In making the assessment, the Board considers the
mandates attributable to such positions, in line with the
scoring mechanism used by Institutional Shareholder
Services, to determine whether a person is overboarded.
The Board does not consider that any of its Directors are
overboarded and is satisfied that sufficient time and
energy is devoted to the Company by each Director.
In line with Provision 15 of the Code, the Executive
Directors do not hold more than one significant Non-
Executive Directorship position.
C O M M I T T E E S
The Board is supported by the Committees outlined in the
table below.
Each Committee has Terms of Reference, governing their
responsibilities and powers, approved by the Board. The
minutes of the Committee meetings are circulated to the
Board and the Committee Chairs provide reports to the
Board on the work undertaken by the Committees.
In addition to the Board, each Committee completed a
performance evaluation during the 2023 financial year. The
TA B L E O F C O M M I T T E E S
COMMITTEE
Audit
Nomination
Placemaking and
Sustainability
Remuneration
PAGE OF
COMMITTEE
REPORT
146
156
162
166
CHAIR
MEMBERS (EXC. CHAIR)
Oliver Tant
Nicky Dulieu, Geeta Nanda
Richard Akers
Nicky Dulieu, Oliver Tant, Geeta Nanda
Richard Akers
Matthew Pratt, Geeta Nanda
Nicky Dulieu
Richard Akers, Oliver Tant, Geeta Nanda
% OF COMMITTEE
INDEPENDENT
100%
100%
67%
100%
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evaluation reports were discussed at a meeting of the
Committees and it was concluded that they were
contributing and functioning effectively and were
complying with their Terms of Reference.
Remuneration policy setting
Pay ratios
Engagement regarding remuneration
170
189
175
N O M I N AT I O N , AU D I T A N D R E M U N E R AT I O N
P R AC T I C E S
To assist with the assessment of the Company’s application
of the Code, the following table sets out where key
information relating to the Company’s practices can be
found within the Annual Report:
Further details of the role, membership and work
undertaken by the Committees throughout the year can be
found in their individual Committee reports on the pages
which follow.
CODE DISCLOSURE
COMPOSITION, SUCCESSION AND EVALUATION
Main roles and responsibilities of the
Nomination Committee
Annual reappointment of Directors and
justification for recommendation
Tenure of Chairman
External search consultancy and connection
disclosure
PAGE
REFERENCE
156
159
158
158
Graham Cope
Company Secretary
15 September 2023
Annual evaluation of Board, Committees and
Directors
158
AUDIT, RISK AND INTERNAL CONTROL
Main roles and responsibilities of the
Audit Committee
Recent and relevant financial experience of
the Committee members
Work undertaken by the Audit Committee
Risk management and internal control
systems
Robust assessment of the Company’s
emerging and principal risks
Adoption of going concern basis of
accounting and assessment of prospects of
the Company
Directors responsibility for preparing the
Annual Report and assessment forming the
basis for their conclusion that the Annual
Report is fair, balanced and understandable
REMUNERATION
Non-Executive Director remuneration
Remuneration consultancy appointment
Executive Director remuneration supporting
alignment with long-term shareholder
interests
Discretion to override formulaic outcomes,
malus and clawback provisions
Notice and contract periods
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88
196
198
182
191
174
170
178
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Audit committee report
AUDIT COMMITTEE
REPORT
The integrity of the financial
statements and the robustness
of the internal control processes
and risk management framework
are fundamental to the work of
this Committee.
Oliver Tant
Chair of the Audit Committee
I N T R O D U C T I O N
I am pleased to present the Audit Committee Report for the
year ended 2 July 2023, which has been prepared in
accordance with the requirements of the UK Corporate
Governance Code 2018 (the “Code”) and the Financial
Conduct Authority’s Listing Rules and Disclosure Guidance
and Transparency Rules (the “DTRs”).
This report describes how the Committee has carried out
its responsibilities during the year.
During 2023, the Committee maintained its focus on
monitoring the integrity of the Group’s internal control
processes and risk management framework and the
effectiveness of the Group’s financial reporting by
providing independent and objective challenge.
C O M M I T T E E M E M B E R S H I P
There are three Members of the Committee, each of whom
are independent Non-Executive Directors, with myself as
Chair of the Committee. The other Members of the
Committee during the 2023 financial year were Nicky
Dulieu, Geeta Nanda and Nick Hewson. Nick Hewson
stepped down as Chair of the Committee on 11 November
2022 when he retired from the Board, at which point I took
over the position of Audit Committee Chair.
Geeta Nanda joined as a Member of the Committee on 1
May 2023 following her appointment to the Board. In line
with Provision 24, the Chair of the Board is not a Member of
the Committee.
The Board is satisfied that there is the requisite recent and
relevant financial experience on the Committee (in line with
Provision 24 of the Code) and that there is sufficient
competence in accounting and auditing (in line with DTR
7.1.1A) due to the following:
• I, Oliver Tant, am a Chartered Accountant with the
Institute of Chartered Accountants of Scotland and the
Institute of Chartered Accountants in England and Wales.
I am the Chair of the Audit Committee at B&M European
Value Retail S.A. and have a long-standing career in
finance having held senior financial positions within
KPMG LLP and a FTSE 100 company;
• Nicky Dulieu is a Fellow member of the Association of
Chartered Certified Accountants and has held various
strategic and financial roles within a FTSE 250 company
over a 23-year period. She is currently the Chair of the
Audit Committee at WH Smith plc and Chair of the Audit
and Risk Committee of John Lewis Partnership plc; and
• Geeta Nanda has been a Member of the Committee
since her appointment and has recent experience of
providing independent challenge of the Company’s
financial performance, risk management and control
procedures.
The qualifications, skills and experience of each
Committee Member can be found on pages 134 to 135.
C O M M I T T E E M E E T I N G S
The Company Secretary acts as Secretary to the
Committee, and detailed papers and information were
circulated by the Company Secretary sufficiently in
advance of meetings to allow proper consideration of the
matters for discussion.
To enable the Committee to provide robust challenge of
the reports submitted to the Committee, regular attendees
at the meetings during the year included the Group
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TA B L E O F AT T E N DA N C E
NAME
Oliver Tant †
Nicky Dulieu †
Geeta Nanda1 †
Nick Hewson2 †
ROLE
Chair
Member
Member
Former Chair
ATTENDANCE AT MEETINGS
4/4
4/4
1/1
1/1
1
2
Geeta Nanda was appointed as a Non-Executive Director on 1 May 2023 and joined as a Member of the Committee at the same time. She has attended the meeting
held from her appointment date to the end of the 2023 financial year.
Nick Hewson stepped down from the Board and as Chair of the Committee on 11 November 2022. He attended the one meeting held from the beginning of the 2022
financial year to the date he left the Board.
† Member considered to be independent. Throughout the 2023 financial year, the Committee was made up of 100% independent Members.
• reviewing and monitoring the external audit process and
independent activity of the external auditors as well as
the nature and scope of the external audit and its
effectiveness;
• reviewing and monitoring the external auditor’s
independence and objectivity;
• monitoring and reviewing the policy on the engagement
of the external auditors to supply non-audit services,
taking into consideration the impact this may have on
independence;
• ensuring that the internal and external audit functions
remain independent and effective through formal and
transparent review;
• reviewing the Company’s procedures for detecting fraud
and the adequacy of its systems and controls for the
prevention of bribery;
• reviewing the Company’s procedures for data
management and cyber resilience;
• reviewing the Company’s procedures and controls for
the prevention of tax evasion and the facilitation of tax
evasion;
• reviewing the Company’s Code of Conduct;
• reviewing the Company’s procedures for raising
concerns; and
• reporting to the Board on how the Committee has
discharged its responsibilities.
The Committee’s Terms of Reference are available on the
Company’s website (redrowplc.co.uk).
Finance Director, Finance Director – Group Services (who
has the responsibility for the Company’s internal audit),
Chief Information Officer (who has the responsibility for IT,
including cyber security and systems accounts), the
Non-Executive Chairman and KPMG LLP as the external
auditor. In addition, other Redrow Group Directors attend
as and when invited to do so.
The Committee met four times during the year and details
of the meeting attendance can be seen in the table above.
It was agreed that going forward, the Committee would
meet five times per year due to the changing regulatory
environment resulting in more items to be discussed and
reviewed by the Committee. The Committee has also had
the opportunity to meet separately with the internal audit
function during the course of the year and the external
auditors following the final audit and the review of the year
ended 2 July 2023 financial statements.
R E S P O N S I B I LI T I E S A N D T E R M S O F R E F E R E N C E
The key responsibilities of the Committee are:
• monitoring the timeliness and integrity of the financial
statements and accompanying reports to the
shareholders and Corporate Governance Statements,
including reviewing any significant financial reporting
judgments contained therein and the findings of the
external auditors;
• monitoring and reviewing any formal announcements
relating to the Company’s financial performance;
• reviewing and monitoring the effectiveness of systems
for internal control, financial reporting and risk
management, including the Risk Register, covering all
material controls (including financial, operational and
compliance controls), having regard to the long-term
prospects and viability of the Company;
• making recommendations to the Board in relation to the
appointment and removal of the external auditors and
approving the remuneration and terms of engagement;
• determining the criteria used in order to assess the
quality of the external audit and reporting on any
significant issues considered in relation to the financial
statements;
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AU D I T C O M M I T T E E R E P O R T I N G O N S I G N I F I C A N T I S S U E S
M A I N AC T I V I T I E S D U R I N G T H E Y E A R
The primary areas of judgment and estimation uncertainty which were considered and challenged by the Committee and
how these were addressed are set out below:
The Committee followed a programme which is structured around the annual reporting cycle and received reports from
internal audit, the external audit and management. The principal activities undertaken were as follows:
AREA OF FOCUS
CONSIDERATIONS
DATE
ACTIVITY
Fire safety provision
Following on from the Committee’s review last year of the fire safety provision provided in the
2022 financial year, the Committee reviewed the changes as a result of the Group signing the
Self Remediation Terms for England (and the equivalent for Wales) in March 2023. This involved
considering the revised methodology to calculate the provision as a result of the Self
Remediation Terms.
September 2022
• A review of the full year 2022 results, including the Annual Report;
• Consideration of the Group risk assessment process, key accounting judgement areas,
viability statement and a going concern review;
• A review of the 2022 Task Force on Climate-Related Financial Disclosures (“TCFD”) Report;
The Committee reviewed management’s accounting assessment to understand the nature of the
remediation costs, judgments on the probability and timing of the outflow and sensitivities
around any estimations.
The Committee also reviewed the Key Process Improvements implemented during the year with
regard to fire safety issues, which included the update of commercial systems to fully handle
main contractor budgets to support the Group’s fire safety works.
Build cost variances
The Committee reviewed the Group’s analysis of the build cost variances to update the standard
cost of work in progress to approximate actual costs and also reviewed the judgments involved
in respect of this.
Valuation of inventory The Committee receives a report prepared by management at each reporting date outlining the
approach taken by management to assess the net realisable value of inventories, with details of
developments with significant areas of judgement and any forward land against which
provisions have been made.
Defined benefit
pension scheme
valuation
The Committee receives details of the IAS 19R – Employee Benefits valuations carried out at
each reporting date for management by the actuary who advises the Company on the
underlying assumptions. This included the proposed treatment of the Trustee investment
decision to purchase a bulk annuity insurance policy during the year. A sensitivity analysis is
also provided for its consideration. The Committee also receives details of the latest triennial
independent scheme valuation report prepared by the Scheme Actuary and reviews key
judgement areas made including relevant actuarial advice that has been received. In addition,
the Committee also reviews the external auditor’s report benchmarking pension actuarial
assumptions. The consolidated balance sheet included a £5m retirement benefit surplus as at
2 July 2023 (3 July 2022: £39m).
Going concern and
viability
The Committee challenged the various risks associated with the continuing uncertain nature of
the economic environment and market conditions.
In order to assess the appropriateness of judgements made by the Company to satisfy itself of the adequacy of
disclosures and to provide independent challenge, the Committee carried out the following:
CONCLUSIONS
• a review of the internal control measures and risk management systems;
• a review of the findings of the external auditor’s testing of controls; and
• a debrief and challenge of the Senior Finance team, including the Group Finance Director and Finance Director
– Group Services, with specific regard to the Group’s valuations, forecasts and assumptions.
Following this, the Committee concluded that appropriate judgements had been applied in determining the estimates
and that adequate disclosures had been made.
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• A review and discussion of the external auditor’s report;
• A review of the related party transaction summary;
• A review of the latest Business Performance Reviews;
• A review of the latest Post Completion Reports;
• A review of the compliance with the Anti-Bribery Policy;
• An update on cyber security;
• An update of the whistleblowing investigations;
• A review of the independence and objectivity of the external auditors;
• A recommendation to the Board to approve the 2022 Annual Report following a review of the
full and clean audit opinion from the external auditors; and
• A recommendation to the Board for it to recommend a final dividend of 22p, subject to
shareholder approval.
February 2023
• A review of the 2023 half-yearly accounts;
• A review of the strategy report from the external auditors;
• Consideration of the key accounting judgement areas and going concern;
• Discussion of accounting policies to be applied for the 2023 financial year;
• A review of the fire safety provision, its utilisation to date and an update on the monthly Fire
Safety Committee meetings;
• Discussion regarding use of the subsidiary audit exemption for certain Group companies;
• A review of the accounting treatment of the Redrow Staff Pension Scheme;
• A review of the Risk Register;
• A review of the latest Business Performance Reviews;
• A review of the Cross Divisional Testing programme;
• A review of the latest Post Completion Reports;
• A review of the compliance with the Anti-Bribery Policy and the Gifts and Hospitality Policy;
• An update on the compliance with the Code of Conduct;
• An update on control improvement implementation;
• A review of a fraud allegation and resultant control measures adopted;
• A further update on cyber security;
• A review and approval of the Terms of Reference of the Committee; and
• A recommendation to the Board to approve the 2023 half-yearly accounts; and
• A recommendation to the Board for it to recommend an interim dividend of 10p.
April 2023
• An update on the work being undertaken in respect of reporting against TCFD for 2023;
• A review of the Cross Divisional Testing programme;
• A review of the latest Business Performance Reviews;
• An update on control improvement implementation; and
• An update on compliance with the General Data Protection Regulation 2018 (“GDPR”).
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DATE
ACTIVITY
June 2023
• Discussion regarding the general update from the Assurance Team;
• A review of the Risk Register;
• Discussion regarding the strategic plan for the Commercial function;
• An update and discussion on internal audit and its strategy;
• A review of the internal controls across the whole business;
• Discussion of the key process and systems improvements implemented during the year;
• An update and discussion on the external audit and fees;
• An update on insurance cover renewal for the Group;
• A review of the whistleblowing report;
• A review and approval of the Group’s updated Anti-Bribery Policy, Receipt of Gifts & Hospitality
Policy, Anti-Facilitation of Tax Evasion Policy, Whistleblowing Policy and Code of Conduct;
• Report presentation of the Committee’s self-evaluation and a discussion on its effectiveness; and
• A review of the updated Terms of Reference of the Committee.
September 2023
• A review of the full year 2023 results, including the Annual Report and a report from the
external auditors;
• Consideration of the Group risk assessment process, viability statement and a going concern
review;
• A review of the related party transaction summary;
• Discussion regarding the latest Business Performance Reviews;
• A review of the compliance with the Anti-Bribery Policy;
• An update on cyber security;
• A review of the 2023 TCFD Report and work undertaken during the year by the Climate
Change Risk Steering Group;
• A review of the effectiveness of the external audit process and independence and objectivity
of the external auditors;
• A recommendation to the Board to approve the 2023 Annual Report; and
• A recommendation to the Board for it to recommend a final dividend of 20p, subject to
shareholder approval.
I N T E R AC T I O N W I T H F R C
The Company received a letter on 11 October 2022 from
the FRC noting that it had carried out an AQR on KPMG’s
audit of the Group’s financial statements for the period
ended 27 June 2021. This review covered one Key Audit
Matter specified within KPMG’s Independent Auditor’s
Report in the 2021 Annual Report, along with other areas of
audit focus. The Audit Committee reviewed and discussed
the scope of the AQR, the AQR report conclusions and the
actions that will be taken in response to the AQR findings
with KPMG. The Audit Committee was satisfied that the
matters raised by the AQR were appropriately incorporated
into the 2023 audit plan.
G O I N G C O N C E R N
Management conducts a detailed going concern review
twice per year, considering liquidity and banking covenant
compliance. The Committee has challenged forecast cash
flows and the assumptions applied to derive the cash flows
and availability of finance from existing facilities. The
Committee also challenged the various risks associated
with the continuing uncertain nature of the economic
environment, interest rates and consumer confidence
levels in light of inflation levels and the cost of living crisis
that have been assumed as part of this review. The cash
flow forecasts evidence that the Group has adequate
levels of liquidity from its committed facilities and complies
with all banking covenants for at least 12 months from 13
September 2023. The Committee therefore considers that
it is appropriate to continue to adopt a going concern basis
in the preparation of the financial statements.
The assessment of going concern is included in the Going
Concern Basis of Accounting Policies section on page 214.
E X T E R N A L AU D I TO R S
Following the last tender process which was undertaken by
the Committee in November 2018, KPMG LLP was
appointed as the external auditor of the Company for the
financial year ended 30 June 2019 and reappointed at the
2022 Annual General Meeting, with 99.79% of votes cast in
favour of re-appointment.
Paul Glendenning is the current Audit Partner and will act
as such for the audit of the financial statements for the
period ended 2 July 2023. He has held handover meetings
with the former Audit Partner, Nick Plumb.
Provision of non-audit services by external auditors
The Committee has a formal policy in respect of the work
undertaken by external auditors. The purpose of this policy
is to ensure that the auditors’ objectivity and
independence is maintained by ensuring both that the
150
nature of any non-audit work undertaken and the level of
fees paid does not compromise the auditors’ position.
the risks associated with the scope and methodology
used in for the calculation.
Appointments in respect of non-audit work require the
prior approval of the Committee within an established
budget. In addition, no work can be undertaken by the
external auditors in any area where there is any identifiable
risk that the work of an individual within the external audit
firm or the external audit firm generally could conflict or
compromise the quality, objectivity or independence of any
audit or compliance work undertaken for the Group.
The external auditors are not indemnified by the Company
nor has the Company purchased liability insurance for
them.
There were no non-audit services provided by the external
auditors during the financial year ended 2 July 2023.
Details of fees paid to KPMG LLP for audit are disclosed on
page 222.
Independence assessment of external auditors
In line with Provision 25 of the Code, the Committee
monitors and reviews the independence and objectivity of
the external auditors. The Committee is satisfied that
KPMG LLP remain independent and objective following its
assessment, taking into consideration the following:
• Tenure of the audit firm – KPMG LLP has completed four
years of external audit services;
• Tenure of the audit partner – the financial year ended 2
July 2023 is the first period which Paul Glendenning has
served as Audit Partner;
• Connection of the audit firm to the Members of the
Committee – I, Oliver Tant (Chair of the Committee),
worked for KPMG LLP from 1982 until 2013. The
Committee is satisfied that the roles held do not impair
the independence of the external auditors as it has been
ten years since I left KPMG LLP. KPMG LLP otherwise has
no connection to any Member of the Committee or the
Board; and
• Level of non-audit services provided to the Company
– there were no non-audit services provided by the
external auditors during the financial year ended 2 July
2023.
Following the above assessment, the Committee is
satisfied that the independence of the KPMG LLP has been
in no way compromised.
Effectiveness assessment of external auditors
The performance of the external auditors is subject to
regular review by the Committee, in line with Provision 25
of the Code. In assessing the effectiveness of the external
auditors, the Committee had regard to the challenge posed
by the external auditors of key management judgments.
During the audit for the financial year ended 2 July 2023,
the external auditor put in place a number of challenge
mechanisms to mitigate the risks associated with the
following:
• Fire safety provision – recognising that there is a degree
of estimation uncertainty of the provision required due to
the potential range of reasonable outcomes as well as
• Management override of controls – recognising that
there is a fraud risk from management’s ability to
override controls that otherwise appear to be operating
effectively.
• Valuation of inventory – recognising there is a risk
relating to the calculation of the net realisable value of
inventories and cost of sales.
During the year, Members of the Committee as well as
regular attendees participated in an evaluation of the
external auditors whereby they reviewed the performance
of KPMG LLP. Respondents provided comments on areas
where they thought the external auditors were performing
well, as well as areas where they felt there was scope for
improvement.
Following its assessment, an anonymised report was
presented to the Committee and the external auditor. The
report was reviewed by the Committee and discussed with
the external auditor, following which the Committee noted
it was satisfied with the effectiveness of KPMG LLP.
Following completion of the 2023 audit, the Committee will
undertake a full review of the external auditors where they
will consider the following in respect of the audit of the
2023 financial statements: the quality of the external audit
processes; the knowledge and experience of the external
audit team; the external audit scope and plan; the external
audit communications; and the external audit governance
and independence.
Re-appointment of external auditors
Following its assessment of the independence and
effectiveness of the external auditors, having received the
recommendation from the Committee, the Company will be
proposing the re-appointment of KPMG LLP as its external
auditor at the 2023 Annual General Meeting.
The Committee confirms that there were no contractual
obligations that acted to restrict the Committee’s choice of
external auditor and that the recommendation is free from
influence by any third party.
I N T E R N A L C O N T R O L S
The Board recognises its overall responsibility for the
Group’s system of internal controls and for monitoring its
effectiveness. There is an ongoing process for identifying,
evaluating and managing significant risks. However, in
reviewing the effectiveness of internal controls, any
internal control system can only provide reasonable but not
absolute assurance against material misstatement or loss.
Key business activities, including finance, land acquisition,
product design, and procurement and information
technology are controlled by the Executive Directors. All
activity is organised within a defined structure with formal
lines of responsibility, designated authority levels and a
structured reporting framework. A formalised reporting
structure has been established within the Group. The
Executive Directors, the Company Secretary, Regional
Chief Executives, Group Human Resources Director, Group
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Customer & Marketing Director and Group Communities
Director (the “Executive Management Team”) meet at least
monthly to discuss the Group’s key issues and principal
and emerging risks and opportunities, and more frequently
if required to meet the demands of the business. The
Divisions also hold monthly board meetings which are
attended on a rotational basis by the Executive Directors.
Redrow’s internal control environment is based on the
‘three lines of defence’ model which is designed to protect
against loss and is supported by a process of independent
review, as follows:
• The first line of defence comprises routine management
oversight of operations in the divisions themselves,
performed within the framework of policy and
procedures and standardised controls, many of them are
automatic controls embedded within our IT systems,
developed by the second line of defence.
• The second line of defence comprises functional teams
and experts operating at a Group level and the Regional
Chief Executives responsible for a number of divisions.
• The third line of defence is primarily the Group
Assurance team who provide objective assurance on the
effectiveness of all aspects of internal control (save for
HS&E and cyber security) based on a risk based annual
assurance programme supplemented by additional ad
hoc reviews.
• The third line of defence for HS&E is the Group HS&E
team who provide site and office HS&E inspections
and internal audits.
• The third line of defence for cyber security is external
cyber security experts.
The Committee reviews the work of the three lines in
monitoring the effectiveness of controls, with the
effectiveness being assessed in the context of an ongoing
process for identifying, evaluating and managing risks.
The Group has in place robust processes and controls to
protect the effective operation of the business and
safeguard our financial and non-financial assets. The key
features of the Group’s internal controls are as follows:
• the ‘three lines of defence’ model, as outlined above;
• defined authorisation levels exist over key areas such as
land purchase, the placing of orders and contracts and
staff recruitment;
• the requirement of a formal land bid approval meeting to
be held for all sites above a certain land value threshold
prior to being submitted. Depending on the threshold,
the meeting must be attended by the Group Chief
Executive, the Group Finance Director, the Regional
Chief Executive, the Managing Director of the Division
and Harrow Estates and provides greater Group visibility
of potential sites at an earlier stage. Main Board approval
is required should the land value threshold reach a
certain level;
• prior to completion on land purchases above a certain
monetary threshold, the requirement for a peer review of
the contract to be conducted by another Divisional Legal
Director, following which the Legal Director must prepare
a supplementary report for the Division;
• a requirement for a peer review to be conducted by
Group Commercial on the instruction of Group
Commercial for any subcontract orders above a certain
monetary threshold;
• a comprehensive prioritised Risk Register which is
regularly reviewed and presented to the Committee;
• the undertaking of scenario analysis and financial
quantification of risks and opportunities deemed
significant to the business relating to climate change;
• the Group’s management information systems provide
weekly updates on key statistics and information in
respect of sales and production and the content of these
weekly reports is regularly reviewed to ensure it remains
appropriate;
• the Group has an in-house Health, Safety and
Environmental department and places great emphasis on
the importance of health and safety and environment
management. The department works closely with the
Divisions to ensure that training is provided to
employees and subcontractors. Best practice is shared
and appropriate actions are taken to comply with health
and safety best practice and legislation throughout the
organisation;
• an Environmental, Social and Governance (“ESG”)
scorecard with cross discipline support which improves
the focus on the relevant key performance indicators and
controls over delivery in those areas;
• the Board requires each director in its operating
Divisions to complete an annual statement on Corporate
Governance, related party transactions and conflicts of
interest. The statement is designed to provide assurance
that Group policies and procedures are being
implemented and complied with in all material respects;
• key functional directors must complete a Principal
Controls Self-Assessment Questionnaire which is
reviewed by the Board to assist in improvements in the
control framework;
• a weekly business report comprising sales funnel
information, gross margins and order book is produced
for the Group, each division and each site and circulated
across the Group;
• a monthly reporting pack is circulated in advance and
reviewed at the meetings of the Board, Executive
Management Team and divisional boards. Annual
budgets are set, with actual performance compared
against the annual budget;
• preparation and regular updates of strategic plans;
• the policy and procedures manuals which cover all the
significant aspects of the Group’s operations and
describes the systems and controls that are to be
applied; and
• daily statements of a reconciled cash position identifying
significant payments are prepared, rolling cash flow
forecasts are prepared and forecast banking covenant
compliance are tested.
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Throughout the year, the Committee carried out
assessments of internal control by considering
documentation from the Executive Directors and the
internal audit function as well as taking into consideration
events since 2 July 2023. The internal controls extended to
the financial reporting process and the preparation of
consolidated financial statements. The basis for the
preparation of consolidated financial statements has been
undertaken in accordance with the Company’s accounting
policies as set out on pages 214 to 219.
During the year the Audit Committee assessed the Group’s
risk management and internal controls systems to be
adequate. However it concluded that the reporting of build
cost variances could be improved and a management
review be implemented to analyse the movements in
underlying gross margin year on year. Following the
Committee’s recommendation, the Board have agreed to
implement the changes in the next financial year.
As reported in the 2022 Annual Report, at the end of the
previous financial year, the Committee were informed
about a failure to comply with the Group’s policies and
procedures in one of the Divisions and took action to
satisfy itself that the matter had been satisfactorily
addressed. In addition to terminating certain members of
the divisional management team, during the year the Group
also put in place increased control measures which
included:
• the appointment of a Group Commercial Director to
strategically lead the function and enhance
communications between Group Commercial and the
Divisions;
• the creation of a new Commercial System training
programme for all Commercial colleagues;
• the implementation of peer reviews carried out by Group
Commercial and routine checks to ensure the accuracy
of the valuation function;
• making amendments to Commercial Policies and
Procedures; and
• improving and enhancing commercial systems.
With the exception of this matter, which the Committee
considers has been satisfactorily addressed, and the
enhancements in the reporting of build cost variances to
be implemented in the next financial year, the Committee
confirms that it is satisfied that the system of controls has
been in operation throughout the financial year and up to
the date of this report.
R I S K M A N AG E M E N T A N D I N T E R N A L AU D I T
The Group has in place a robust risk management
framework and the table below provides details of the key
components of the risk management system which are
subject to regular review and challenge by the Committee.
The internal audit strategy and risk management framework
is discussed with the external auditors, and then discussed
and agreed with the Committee. Suggested control
improvements and any control weaknesses identified are
followed up as appropriate.
COMPONENT
DESCRIPTION
Risk Register
The Group’s Risk Register defines controls as prevent or detect and identifies owners for each
high-level risk. Feedback on the risks and controls is actively encouraged. The Register itself is
regularly maintained and is reviewed by the Committee biannually and more often as necessary.
Authorisation
Processes
Defined authorisation levels exist over key areas such as land purchase, the placing of orders
and contracts and staff recruitment.
Business Process
Review Programme
The cornerstone of the internal audit work undertaken is the Business Process Review, a
risk-based programme designed (based on the Risk Register) to be carried out regularly at each
Division of the Group. The Business Process Review programme looks to provide assurance to
the Group by testing internal controls and adherence to Policies and Procedures and reviewing
specific principal and emerging risks. It also plays an important role in seeking out best practice
and sharing it across the Group and identifying business process improvements.
Business Process Review executive summary reports are presented to the Audit Committee and
copies of the detailed reports are provided to the Chair of the Audit Committee.
Action plans are developed by the Divisions to implement the Business Process Review
recommendations and follow up meetings held to review these.
The programme is reviewed annually following the completion of the Risk Register review to
ensure that it evolves and adapts in line with the needs of the business.
Cross Divisional
Testing Programme
The Cross Divisional Testing programme complements and runs alongside the main Business
Process Review programme and covers a number of functional areas. The Cross Divisional Testing
programme primarily focuses on testing which can be performed more efficiently at a remote level
across all Divisions at once and therefore provides a direct and instant comparison between
Divisions, immediately highlighting sources of best practice to be shared across the Group.
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Audit committee report / continued
COMPONENT
DESCRIPTION
Development
Completion Reporting
The Company has in place a business planning process whereby each land transaction,
following completion of the development, is tested against its original appraisal to ascertain its
performance and to improve cash flow forecasting. These Development Completion Reports are
provided to the Committee and are discussed at the appropriate meetings.
Business Policies and
Procedures
Group Policies and Procedures are regularly reviewed and updated by the department owners
and shared on the Group’s intranet, Engage. Key policies are assigned with ‘mandatory read’
status for all or select groups of employees to ensure that they are read and understood by the
requisite audience.
Gift Register
Reporting
HS&E Assurance
Inspections
The Committee is provided with regular updates on changes made to the current policies and
procedures as well as an overview of newly released policies.
The Business Performance Reviews test key controls and adherence to the policies and
procedures on a sample basis across all Divisional departments.
In line with the Anti-Bribery and Corruption policy and Receipt of Gifts and Hospitality policy,
each Division across the Group maintains its own Gift Register whereby all gifts received over
the relevant threshold must be recorded. Gift authorisation forms must be formally approved
and retained by each Division. Regular reviews of the Gift Register are undertaken in order to
detect any potential issues arising under the Bribery Act 2010. A combined Group-wide register
is provided to the Committee to allow risk assessments to be carried out by the Committee.
Within the Code of Conduct, there is a gift-specific decision-making tool which employees are
encouraged to use when considering whether they should accept or offer a gift or hospitality.
The purpose of this is to guide them to the expected behaviours in line with the policy. The Gift
Register Reports are provided to the Committee and discussed at the relevant meetings.
HS&E Assurance Inspections are undertaken by the Health, Safety and Environmental
Department across all operational construction sites on a minimum frequency of one every two
months. The aim of such inspections is to identify compliant and non-compliant sites in respect
of both the safety of activities by the Group’s subcontractors and the correct application of the
Group’s HS&E Management System. The scores are then benchmarked against the internal level
of compliance deemed satisfactory and reported to the Committee.
Cyber Security
Penetration Testing
Third party penetration tests are undertaken on the Group’s cyber security systems at least
twice per year. The results of these penetration tests are then reported at functional and
Executive Management Team meetings, as well as being reported through the Committee by
the Chief Information Officer.
R I S K R E G I S T E R
The Group formally reviews its prioritised Risk Register
biannually and more often as necessary. At least annually,
the detailed Risk Register is circulated to all Divisional
Managing Directors or Regional Directors and key Group
Directors and Heads of Department to review with their
teams. Feedback is then collated on any omissions or
amendments to the risks or controls, any views regarding
risks which have become more or less significant since the
last review period and provide any other comments
relating to the risks or controls.
Responses from the review exercise are then summarised
and forwarded to the risk owners together with the current
detailed Risk Register and a scoring matrix. The Risk
Register is then updated as appropriate, according to the
impact and likelihood of the risks after taking into
consideration the prevent and detect controls.
The Executive Management Team, through its regular
meetings, reviews key areas of risk on an ongoing basis
and considers whether the internal controls identified in
relation to those risks remain appropriate. The updated and
reviewed Risk Register is reviewed and considered by the
Committee at least twice per year. The Committee then
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reports to the Board to provide the relevant assurances
that the risk management process has been managed
effectively by the business during the period.
I N S U R A N C E
The Board has appointed an experienced broker to advise
on and co-ordinate all insurance matters across the Group
and they liaise closely with appropriate Group personnel
and insurance co-ordinators within the Divisions and report
directly to the Group Finance Director. The insurance
renewal is discussed and agreed by the Committee
annually.
B R I B E RY AC T
Following the introduction of the Bribery Act 2010, the
Company put in place a formal policy on bribery and
corruption for all employees to strictly adhere to. The
Company Secretary ensures that the policy is complied
with, updates the policy, procedures and Code of Conduct
as and when required and provides regular reports to the
Committee. The Bribery Act policy is formally reviewed and
approved each year by the Committee.
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The policy contains the definition of bribery and corruption,
providing examples of how this could work in the context of
the Company’s industry and offers guidance as to what
would be considered acceptable behaviour. The policy
deals with all matters of bribery and corruption and clarifies
the Company’s strict approach to any form of facilitation
payment or conflict of interest.
Training is given to all staff to highlight the various forms of
bribery and all new staff attend an induction course at the
commencement of their employment which includes a
section relating specifically to bribery and the implication
on individuals and the Company of an act of bribery either
given or received. Within the Code of Conduct, there is a
specific decision-making tool which is designed to provide
employees with key questions to ask themselves should
they ever be faced with difficult situations which could
ultimately lead to bribery or corruption. This aims to
encourage them to act in a way that is in line with Company
policy and prevent any form of bribery taking place.
As outlined on page 154, the Committee is provided with
Gift Register Reports following the twice-yearly reviews on
the compliance with the Anti-Bribery and Corruption policy
and Gifts and Hospitality policy.
T H E C R I M I N A L F I N A N C E S AC T
Following the introduction of the Criminal Finances Act
2017, the Company put in place a policy relating to the
facilitation of tax evasion. The policy is applicable to every
employee and the Redrow Employee Handbook (which is
provided to each new employee) includes reference to the
policy and the Group’s zero tolerance stance on tax
evasion and its facilitation. As with the Bribery Act policy,
the Company Secretary ensures that the policy is complied
with and reports to the Committee on matters falling within
the policy.
The Anti-Facilitation of Tax Evasion policy is formally
reviewed and approved each year by the Committee. There
were minor changes made to the policy during the year.
• integrity (comprising bribery, gifts and hospitality, tax
evasion facilitation, conflicts of interest, share dealing
and data and asset protection); and
• charitable and political donations.
The Code of Conduct has been made available to all
employees and is publicised on the Company’s intranet,
Engage and is also available to view at redrowplc.co.uk.
The Committee reviews and approves the Code of Conduct
at least annually.
P E R F O R M A N C E E VA LUAT I O N
After reviewing the 2022 externally facilitated evaluation
report, a questionnaire was created and tailored, taking
into consideration comments made in the previous year’s
assessment as well as the current market.
The questionnaire was completed by all Members of the
Committee, its regular attendees and KPMG LLP as
external auditor. Following completion of the Committee
assessment questionnaire, an anonymised effectiveness
report was compiled and presented to the Members of the
Committee.
The evaluation found that the Committee was discharging
its responsibilities well. The meetings were found to be
well-chaired with the right mix of people involved in the
discussion. The procedures of the Committee were found
to be conducive to effective performance and flexible
enough to deal with all eventualities.
As part of the review, the following items were agreed as
actions to progress during the 2024 financial year:
• as the new Chair of the Committee, I would develop an
action plan based on feedback of the Committee as I
continue to enhance its operation; and
• the number of Committee meetings would be increased
to five per year to:
• enable the Committee to discharge its responsibilities
to the fullest; and
C O D E O F C O N D U C T
• allow for more rigorous challenge by the members of
The Company has in place a Code of Conduct, which acts
as a guide for employees to do the right thing in business.
It focuses on the values and behaviours deemed most
important for the Group and seeks to guide employees in
their good judgment to act in the Redrow way.
The Code of Conduct provides a number of decision-
making tools to assist employees if faced with difficult
decisions and sets out the Company’s policy on a number
of key matters deemed integral to doing the right thing in
business, including:
• whistleblowing;
• health, safety and environment;
• diversity and inclusion;
• human rights;
• supply chain and modern slavery;
the Committee.
Having discussed the findings of the evaluation, the
Committee was found to be effective, concluding that it
had fulfilled its remit and had in place appropriate Terms of
Reference.
C O M P L I A N C E S TAT E M E N T
The Company has complied with the provisions of The
Statutory Audit Services for Large Companies Market
Investigation (Mandatory Use of Competitive Tender
Processes and Audit Committee Responsibilities) Order
2014 for the year ended 2 July 2023.
Oliver Tant
Chair of the Audit Committee
15 September 2023
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Nomination committee report
NOMINATION COMMITTEE
REPORT
The Committee is responsible
for ensuring that the Board is of
the appropriate structure, size
and composition to create and
deliver our strategy.
Richard Akers
Chair of the Nomination Committee
I N T R O D U C T I O N
I am pleased to present the Nomination Committee Report
for the year ended 2 July 2023. This report has been
prepared in accordance with the requirements of the UK
Corporate Governance Code 2018 (the “Code”).
Committee on 11 November 2022 when he retired from the
Board.
The biographies of the Members of the Committee can be
found on pages 134 to 135.
During 2023, the Committee focused on ensuring that the
Board and Executive Management Team have the requisite
level of diverse skills, knowledge and experience to deliver
the long-term success of the Company.
Since publication of the previous Annual Report, Nick
Hewson stepped down from the Board as Non-Executive
Director on 11 November 2022 having served a nine-year
term as a Non-Executive Director of the Company.
On 1 May 2023, we welcomed Geeta Nanda as an
additional independent Non-Executive Director. Geeta
Nanda is also a Member of the Audit, Remuneration,
Nomination and Placemaking and Sustainability
Committees. We are delighted that Geeta Nanda has joined
us as she brings strong housing experience as well as
broader commercial and operational expertise that will add
considerable value to the Board.
C O M M I T T E E M E M B E R S H I P A N D M E E T I N G S
In addition to myself, there are three other Members of the
Committee, each of whom is an independent Non-
Executive Director. The other Members of the Committee
during the 2023 financial year were Nicky Dulieu, Oliver
Tant, Geeta Nanda and Nick Hewson. The Company
Secretary acts as Secretary to the Committee.
As stated in my introduction above, Geeta Nanda joined as
a Member of the Board and the Committee on 1 May 2023
and Nick Hewson stepped down as a Member of the
The Committee met formally three times during the year
ended 2 July 2023. For all meetings, and where otherwise
necessary, papers were circulated sufficiently in advance
to allow proper consideration of all matters for discussion.
Details of the meeting attendance can be seen in the table
opposite.
R E S P O N S I B I LI T I E S A N D T E R M S O F R E F E R E N C E
The key responsibilities of the Committee are:
• reviewing the structure, size and composition of the
Board (including skills, knowledge and experience) and
making recommendations for further recruitment to the
Board or proposing changes to the existing Board;
• reviewing the leadership needs of the Company, both
executive and non-executive, ensuring appropriate
succession planning for Directors and other senior
executives within the business;
• leading the process for Board appointments, ensuring
they are conducted on merit and against objective
criteria and taking into consideration that diversity is an
important factor forming part of the selection criteria
used to assess candidates to achieve a balance on the
Board;
• making recommendations to the Board, including on
appointment of Executive Directors and Non-Executive
Directors to the Board, the re-appointment of Directors,
the re-election of Directors at the Annual General
Meeting and the membership of the Audit, Nomination,
156
TA B L E O F AT T E N DA N C E
NAME
Richard Akers †
Nicky Dulieu †
Oliver Tant †
Geeta Nanda1 †
Nick Hewson2 †
ROLE
Chair
Member
Member
Member
Member
ATTENDANCE AT MEETINGS
3/3
3/3
3/3
1/1
1/1
1
2
Geeta Nanda was appointed as a Member of the Committee on 1 May 2023 and attended the meeting held between her appointment date and the end of the 2023
financial year.
Nick Hewson stepped down from the Board on 11 November 2022 and attended the meeting held between the beginning of the 2022 financial year and his
retirement.
† Member considered to be independent. Throughout the 2023 financial year, the Committee was made up of 100% independent members.
Remuneration and Placemaking and Sustainability
Committees;
• a review of the structure, size and composition of the
Board;
• ensuring that a formal, structured and tailored induction
• a review of executive and non-executive succession;
programme is undertaken by any newly appointed
member of the Board;
• ensuring that a formal annual evaluation of the Board and
its Committees is conducted and that such an evaluation
be externally facilitated when deemed necessary and at
least every three years;
• reviewing annually the time required from the Non-
Executive Directors, as well as considering the external
commitments of all members of the Board and assessing
whether there are any issues with overboarding;
• assessing the independence of the Non-Executive
Directors which the Company deem to be independent
taking into consideration the circumstances outlined in
Provision 10 of the Code;
• satisfying itself with regard to succession planning for
the Board and the Executive Management Team, taking
into account the following:
• a review of the independence of the Non-Executive
Directors;
• a review of the succession plans of the Executive
Management Team;
• an assessment of the Board composition and diversity;
• a recruitment process for a new Non-Executive Director;
• an evaluation of the Board, its Committees and the
Executive and Non-Executive Directors;
• a review and recommendation that all of the Directors
stand for re-election at the 2023 Annual General
Meeting in accordance with the Code; and
• a review of the Committee’s Terms of Reference.
Where appropriate, the Directors were not present and did
not vote when any individual proposals were discussed.
• challenges and opportunities facing the Company;
S U C C E S S I O N P L A N N I N G
• future skills and expertise needed on the Board,
including development and training; and
• the need to support the development of a diverse
pipeline;
• ensuring suitable candidates for the Board are identified
through an appropriate recruitment process, giving due
regard to the benefits of diversity, including gender and
ethnicity, and recommending their appointment; and
• reviewing the Equality, Diversity and Inclusion Policy and
ensuring there is sufficient linkage to the Company’s
strategy.
The Committee’s Terms of Reference are published on the
Group’s website (redrowplc.co.uk).
Executive Directors
Matthew Pratt, previously Chief Operating Officer, was
promoted to Group Chief Executive on 1 July 2020. Having
joined the Board on 1 April 2019 as Chief Operating Officer,
the Committee recommended the promotion of Matthew
Pratt to Group Chief Executive. The Committee remains
satisfied that his capabilities, experience and strategic
focus allow him to effectively lead the operational
management of the Group and implement strategic plans
with the assistance of the Executive Management Team.
Having joined the company in 2003 as a Chief Quantity
Surveyor and then becoming a Regional Chief Executive in
2013, Matthew Pratt is a prime example of how the
Company develops and nurtures talent in line with the
strategic theme of Valuing People, resulting in the ability
for employees to make their way up to the Board.
M A I N AC T I V I T I E S D U R I N G T H E Y E A R
During the 2023 financial year, the Committee undertook
the following activities:
Barbara Richmond, Group Finance Director, joined the
Board from an external post in January 2010 and continues
to demonstrate a high level of competence in her role,
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displaying effectiveness in overseeing the financial
management of the Group and maintaining effective
communications with shareholders.
The Committee maintains an active succession plan matrix
that identifies key individuals within the business as having
potential to progress to the Board and/or Executive
Management Team. The succession plan matrix is reviewed
on an ongoing basis and is approved by the Board at least
every six months. A development plan has been put
together to ensure that those identified individuals are
provided with the resources deemed necessary or
desirable to allow them to achieve their full potential within
the business.
Non-Executive Chairman
I was appointed to the Board as independent Non-
Executive Director and Chair-Designate on 1 June 2020
and was made Non-Executive Chairman on 15 September
2021.
I have significant industry and commercial experience
gained over a long career and have also gained valuable
experience as a Non-Executive Director through various
roles in other companies.
Non-Executive Directors
The Board considers that succession planning of the Board
and its Committees is extremely important and believes
that it currently has a good balance and diversity among its
Non-Executive Directors, with each of them having relevant
skills derived from serving in a range of executive and
non-executive positions over many years.
During the year, the Committee carried out an exercise to
determine any gaps in experience or balance on the Board.
As part of this exercise, the Committee assessed the
independence of the current Non-Executive Directors,
taking into consideration the circumstances likely to impair
independence outlined in Provision 10 of the Code.
Recruitment of Geeta Nanda
As outlined in last year’s report, the Board engaged
Odgers Berndtson as the recruitment consultants to assist
with the search for a new Non-Executive Director in
addition to the recruitment process which led to the
appointment of Oliver Tant. Other than assisting with the
recruitment of Oliver Tant in 2021, Odgers Berndtsons has
no connection to the Company or any of the individual
directors.
A role specification was put together with a focus on
housing and operational experience and the Committee
expressed the value that it believed a diverse Non-
Executive Director could bring to the Board.
The Committee was provided with a longlist of candidates
from which it developed a shortlist for interviews. Each
Member of the Committee, along with the Executive
Directors, met with all shortlisted candidates. The
Committee held a debrief following the conclusion of all
interviews and meetings and made the recommendation to
the Board that Geeta Nanda be appointed.
158
The Board accepted the recommendation of the Committee
and formally approved the appointment in December 2022,
following which an announcement was made to investors
and Geeta Nanda joined the Board on 1 May 2023.
B OA R D P E R F O R M A N C E E VA LUAT I O N
In line with the Code, each year a formal performance
evaluation of the Board and its Committees is undertaken.
In 2022, an externally facilitated evaluation of the Board
and Committees was carried out by Independent Audit.
This year, a formal internal evaluation of the Board and
Committees was undertaken to build upon the progress
made in previous years. In line with Provision 21 of the
Code, the Board shall be engaging an external evaluator to
facilitate the evaluation of the Board by no later than 2025.
After reviewing the 2022 evaluation report, a questionnaire
was created and tailored, taking into consideration
comments made in the previous year’s assessment as well
as the current market.
The questionnaires were completed by all members of the
Board and each member of the Committees. Members of
the Executive Management Team and key external advisors
were also invited to participate in the relevant
questionnaires.
In addition to participating in the questionnaires, interviews
were set up by the Senior Independent Director and
Company Secretary with each individual Board member.
Directors were requested to give feedback on the general
effectiveness of the Board and to discuss their answers
and observations from completion of the evaluation
questionnaires. Directors were also asked to provide
feedback on how well they felt the Company had
responded to the key points from the 2022 Board
evaluation.
All interviewees were advised that comments made during
the interviews were confidential and would only be fed
back to the Board via an anonymised report.
Following completion of the questionnaires and interviews,
the Company Secretary together with the Senior
Independent Director compiled an anonymised
effectiveness report which was presented at the relevant
Board and Committee meetings held in June 2023.
Having considered the output of this year’s evaluation, the
Board considers that it continues to function effectively
and its relationship with its Committees continues to be
sound. The main observations from the evaluation were
that:
• the role of the Board and the understanding of the
Board’s responsibilities is clear and Directors are
cohesive in supporting Board decisions;
• the Board manages its time effectively in meetings and
has a good insight into areas that might affect the
Company’s reputation; and
the effectiveness of the Directors, the Nomination
Committee will make recommendations to the Board on
re-appointments.
• the right behaviours are being driven when setting
strategy and financial targets and the reward structures
produce appropriate incentives that encourage desired
behaviours and responsible risk-taking.
The evaluation also identified the following areas for
improvement, which will continue to be addressed over the
coming year:
• to improve meeting organisation, it was agreed that an
Annual Board agenda was to be put in place to include
proposed locations, routine matters and specific topics;
• use of external speakers was noted to be valuable and
that it would assist with planning to agree a program of
external presenters to the Board for the next year to
achieve more from these; and
• It was identified that there was scope to develop a fuller
understanding of interactions with key stakeholders to
ensure all aspects are fully covered at Board level.
P R O G R E S S F R O M 2 02 2 E VA LUAT I O N
RECOMMENDATIONS OF
IMPROVEMENT FROM THE 2022
EVALUATION
Scope for proposals to
come to the Board at an
earlier stage where the
Board could provide more
input prior to finalisation.
Scope for an increased
focus on the role of the
Board in managing a crisis
and looking for the
“unknown-unknowns” that
could impact the Company.
Key messaging in Board
papers could be highlighted
more clearly to ensure the
key messaging is not
missed in the detail.
ACTION TAKEN DURING THE YEAR
During the past year, the
Chairman together with the
Company Secretary have
evolved the Annual Board
programme which has
assisted with the planning
and timing of matters being
presented to the Board.
The disaster scenario matrix
was reviewed and is now
maintained and discussed
by the Board twice per year.
Additionally, a Business
Continuity Plan is
maintained by the Company
which sets out the roles and
responsibilities at varying
levels in the event of a
crisis.
The content of the papers
presented to the Board has
changed over the past year
and this remains ongoing as
part of the evolution of the
Board programme.
The Committee believes that presently the balance of
Non-Executive and Executive Directors is effective and
contains the appropriate mix of skills and experience for
the Board to continue to operate successfully. The current
composition is compliant with Provision 11 of the Code as
the ratio of independent Non-Executive Directors to
Executive Directors (excluding the Chairman) is 3:2 (60%).
The Committee has also assessed the time commitment of
all Directors to ensure that any other commitments do not
compromise their ability to commit sufficient time to the
Company to properly discharge their responsibilities. The
Committee does not consider that any of its Directors are
overboarded and is satisfied that sufficient time and
energy is devoted to the Company by each Director.
The Committee is mindful of the principles and provisions
of the Code on election and re-election, including that
there should be a formal, rigorous and transparent
procedure for the appointment of new directors to the
Board, and that annual re-election is subject to continued
satisfactory performance.
Following an assessment comprising the following factors,
the Committee has satisfied itself that all Directors
continue to perform satisfactorily and are important to the
Company’s long-term sustainable success:
• the effectiveness of the Directors as part of the annual
evaluation, including in relation to their fulfilment of their
duties under section 172 of the Companies Act 2006;
• the skills, knowledge and experience of the Directors,
taking into consideration the requirements of the
Company, including the individual contributions as
displayed on pages 134 to 135;
• the time dedicated by the Directors to the Company in
order to properly discharge their responsibilities; and
• the fulfilment of the independence criteria, as outlined in
Provision 10 of the Code.
Following the recommendation from the Nomination
Committee, the Board has satisfied itself that all Directors
who will be submitting themselves for re-election continue
to perform satisfactorily. Details of appropriate Annual
General Meeting Resolutions will be found in the Notice of
Annual General Meeting which will be sent to shareholders
separately.
D I V E R S I T Y
The principle of boardroom diversity is strongly supported
and recognised by the Board and has clear linkages to the
Company’s strategy, with Valuing People being one of the
Company’s three strategic themes.
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• Board Members are open and honest with each other
A N N UA L R E - E LE C T I O N O F T H E D I R E C TO R S
about what they really think and the relationship
between Board Members and management is
constructive;
The appointments of the Non-Executive Directors are
generally made for three-year terms and all Directors are
subject to annual re-election. Following the assessment on
It is the Board’s policy that appointments to the Board will
always be based on merit, so that the Board has the right
individuals in place, and the Board recognises that
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Nomination committee report / continued
TA B L E O F B OA R D G E N D E R D I V E R S I T Y
TA B L E O F E T H N I C D I V E R S I T Y
NO. OF BOARD
MEMBERS
% OF THE BOARD
NO. OF SENIOR
POSITIONS1 ON THE
BOARD
NO. IN EXECUTIVE
MANAGEMENT
% OF EXECUTIVE
MANAGEMENT
NO. OF BOARD
MEMBERS
% OF THE BOARD
NO. OF SENIOR
POSITIONS1 ON THE
BOARD
NO. IN EXECUTIVE
MANAGEMENT
% OF EXECUTIVE
MANAGEMENT
Men
Women
Not specified/prefer not to say
3
3
–
50%
50%
–
2
2
–
6
3
–
67%
33%
–
1
Senior position is classified as: Chair, Chief Executive Officer, Senior Independent Director or Chief Financial Officer.
2 The data in the above table is collected by the Company upon appointment on the basis of self-reporting by the individuals concerned.
TA B LE O F G E N D E R D I V E R S I T Y
MALE
FEMALE
White British or other White
(including minority white groups)
Mixed/Multiple Ethnic Groups
Asian/Asian British
Black/African/Caribbean/Black
British
5
–
1
–
Other ethnic group, including Arab –
Not specified/prefer not to say
–
83%
–
17%
–
–
–
4
–
–
–
–
–
9
–
–
–
–
–
100%
–
–
–
–
–
The data in the above table is collected by the Company upon appointment on the basis of self-reporting by the individuals concerned.
diversity is an important consideration forming part of the
selection criteria used to assess candidates to achieve a
balance on the Board.
The Board currently has not imposed a diversity quota at
Board level but will keep this under review and consider
putting this in place should it feel that it is in the best
interests of the Company to do so.
The Group HR Director attends the monthly Executive
Management Team meetings and provides a monthly HR
report, which provides key statistics on Group employees
as well as providing updates on employee engagement
and recruitment. She reports to the Nomination Committee
at least twice a year to provide an update on progress.
With Equality, Diversity and Inclusion (“ED&I”) being an
increasingly important consideration for shareholders and
given its positive impact on business performance, the
Remuneration Committee considered that it was an
important input measure to progress going forward as part
of the annual bonus and for the 2023 financial year bonus,
5% was based on management actions relating to
increasing diversity. It has been agreed that this would be
increased to 10% of the 2024 financial year bonus.
Details of the Group’s ED&I Policy can be seen on page
194.
Gender diversity
The composition of the Board currently exceeds the target
of 33% female representation on boards outlined in the
FTSE Women Leaders review. The Company also exceeds
the targets as set out by the FCA (at least 40% of Board
seats occupied by females and at least 1 female in a Senior
Position on the Board) and the information is set out above
in line with Listing Rule 9.8.6R(10).
160
Main Board
3 (50%)
3 (50%)
1 Senior position is classified as: Chair, Chief Executive Officer, Senior Independent Director or Chief Financial Officer.
active area for ongoing development and it was agreed
that the induction process would be reviewed during the
coming year.
Having discussed the findings of the evaluation, the
Committee was found to be effective, concluding that it
had fulfilled its remit and had in place appropriate Terms of
Reference.
Richard Akers
Chair of the Nomination Committee
15 September 2023
Executive Management
Team
6 (67%)
3 (33%)
Direct reports to Executive
Management Team
28 (78%)
8 (22%)
Redrow employees at
2 July 2023
1,448 (66%)
741 (34%)
The Board believes in the benefits of cognitive diversity,
from a wide range of complementary skills. The Committee
will continue to aspire to maintain a diverse Board with
recruitment and selection of talented individuals with a
broad range of appropriate skills, irrespective of gender or
otherwise. In line with Provision 23 of the Code, the table
above sets out the current position of the Company on a
gender basis.
Ethnic diversity
The Committee continues to monitor and review reports
and recommendations relating to the composition of
boards and diversity. The Group HR Director regularly
reports to the Committee on the diversity of the workforce,
the breakdown of which now includes employee
representation figures of ethnically diverse people at an
all-employee level and directorate level. Improving the
diversity of our workforce is a key focus at present, both at
entry level and for progression.
The Committee believes that all levels of the business
should reflect a diverse workforce and that appointments
to the Board will always be based on merit. The Board
strictly prohibits any bias towards any particular ethnicity,
creed, religious belief or otherwise.
As a national housebuilder, the Company is present in
many different communities and the Board believes that
the Group’s workforce should be reflective of the
communities we work in and the customers we create
homes for, including in respect of ethnicity.
The composition of the Board currently meets the target of
at least one Board member from a minority ethnic
background by 2024 set by the Parker Review. The
Company also meets the target as set out by the FCA (at
least one individual on the Board from a minority ethnic
background) and the information is set out above in line
with Listing Rule 9.8.6R(10).
The Committee notes the new targets launched for
December 2027 by the Parker Review that each FTSE 350
company set a percentage target for senior management
positions that will be occupied by ethnic minority
executives and that these targets will be included in next
year’s Annual Report.
Given the value placed on diversity by the Company and
its focus on progressing the ED&I agenda, the candidate
brief prepared for the latest recruitment process for a
Non-Executive Director factored in the Board’s desire for a
diverse Non-Executive Director, recognising the value that
the Board believes such a candidate can bring to the
Board. We are pleased to have appointed Geeta Nanda
and believe her skills, experience and background will be
highly beneficial to the Board.
Further details of the steps taken by the Company to
increase diversity and raise awareness of the importance
of an inclusive workforce can be found on page 72.
C O M M I T T E E P E R F O R M A N C E E VA LUAT I O N
After reviewing the 2022 externally facilitated evaluation
report, a questionnaire was created and tailored, taking
into consideration comments made in the previous year’s
assessment as well as the current market.
The questionnaire was completed by all Members of the
Committee and its regular attendees. Following completion
of the Committee assessment questionnaire, an
anonymised effectiveness report was compiled and
presented to the Members of the Committee.
The evaluation found that the Committee was discharging
its responsibilities well, is effectively chaired and reports
appropriately to the Board. Succession planning remains an
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Redrow plc Annual Report 2023Redrow plc Annual Report 2023Governance reportGovernance report
Placemaking and sustainability committee report
PLACEMAKING AND
SUSTAINABILITY COMMITTEE
REPORT
The Committee is focused on
the Company’s operations on
the environment, its communities
and its employees and ensures
alignment with the three
strategic themes of: Developing
Thriving Communities, Building
Responsibly and Valuing People.
Richard Akers
Chair of the Placemaking and Sustainability
Committee
I N T R O D U C T I O N
I am pleased to present the Placemaking and Sustainability
Committee Report for the year ended 2 July 2023.
During the year, the Committee maintained its focus on
monitoring the Company’s approach to placemaking and
sustainability and impact of the Company’s operations on
the environment, its communities and its employees.
C O M M I T T E E M E M B E R S H I P A N D M E E T I N G S
The Members of the Committee during the financial year
comprised myself as Chair of the Committee, Matthew
Pratt, Geeta Nanda and Nick Hewson. Nick Hewson
stepped down as a Member of the Committee on 11
November 2022 when he retired from the Board. The
Company Secretary acts as Secretary to the Committee.
The Committee met three times during the 2023 financial
year. For all meetings, papers were circulated sufficiently in
advance to allow proper consideration of all matters for
discussion. Details of the meeting attendance can be seen
in the table below.
R E S P O N S I B I LI T I E S A N D T E R M S O F R E F E R E N C E
The key responsibilities of the Committee are:
• to monitor the execution of the strategy approved by the
Board and to make recommendations from time to time
to the Board;
• to review and scrutinise the sustainability targets
proposed by management for recommendation to the
Board;
TA B L E O F AT T E N DA N C E
NAME
Richard Akers †
Matthew Pratt
Geeta Nanda1 †
Nick Hewson2 †
ROLE
Chair
Member
Member
Member
3/3
3/3
1/1
1/1
1
2
Geeta Nanda was appointed as a Non-Executive Director on 1 May 2023 and joined as a Member of the Committee at the same time. She has attended the meeting
held from her appointment date to the end of the 2023 financial year.
Nick Hewson stepped down from the Board on 11 November 2022 and attended the Committee meeting held between the beginning of the 2023 financial year and
the date he stepped down from the Board.
† Member considered to be independent. At the end of the 2023 financial year, the Committee was made up of 67% independent Members.
162
• to monitor the Company’s strategy on climate change as
set out by the Group Chief Executive (holding ultimate
responsibility for climate-related matters) and the Group
Communities Director;
• to review the performance of the Company in relation to
ESG matters, taking into consideration feedback from
reports received from key research and analytic bodies;
• to assess the impact of the Company’s operations on the
environment and communities affected by its activities,
including the consideration of policies to enhance the
benefits of those activities and mitigate any negative
impact of those activities;
• to monitor the Company’s approach to environmental,
corporate social responsibility and community issues,
including environmental management systems, waste
and recycling management systems and energy and
carbon management;
• to monitor the Company’s approach to placemaking,
including the Group’s adherence to the Redrow 8, being
the placemaking principles for designing sustainable
communities;
• to review in advance of each meeting the Sustainability
team’s update on non-financial ESG performance to
assist the Committee to more clearly evaluate the
relationship between the sustainability initiatives in
place, or being considered, and the related performance
levels being achieved;
• to monitor the Company’s developments in customer
engagement and service to ensure the Group values are
upheld;
• to investigate any statutory prosecutions or notices in
relation to environmental and community issues and
make recommendations to the Board regarding any
action to be taken;
• to have regard to the Company’s involvement in the
community, and the Company’s policy on charitable
donations and activities;
• to present a brief summary report to the Board, following
each Committee meeting, outlining the pertinent points
that should be given due consideration and respond to
any other report or information requests from the Board
as and when they arise; and
• to ensure that any initiatives and objectives are aligned
with the Company’s three strategic themes of:
Developing Thriving Communities, Building Responsibly
and Valuing People.
The Committee regularly reviews its Terms of Reference.
These were last reviewed in May 2023 and are published
on the Group’s website (redrowplc.co.uk).
M A I N AC T I V I T I E S D U R I N G T H E Y E A R
During the year ended 2 July 2023, the principal activities
of the Committee were as follows:
ACTIVITIES OF THE COMMITTEE RELATING TO THE OVERALL STRATEGY
• Discussed the progress made against the ESG Scorecard targets in the 2022 Annual Report along with the new
measurements and targets for the 2023 Annual Report;
• reviewed the ESG Improvement Plan;
• analysed the latest ESG rating figures;
• received an update on the stakeholder engagement and materiality review;
• received an update on the non-financial reporting journey of the Company;
• reviewed the reporting against the United Nations Sustainable Development Goals;
• discussed of the latest CDP Climate Change and Forests submission;
• reviewed the work undertaken in respect of the TCFD-aligned reporting for the 2023 Annual Report and resulting
work stream;
• discussed the climate change physical risk workshops which were carried out alongside a specialist consultant to
help understand the impact of climate related physical risks on four strategic Redrow developments;
• reviewed and ratified the Redrow Sustainable Operational Framework for implementation in the 2024 financial year;
SBTi commitment;
• discussed the global frameworks and standards of which the Company may wish to report against in the coming
years;
• received an update on the work of the Transition Plan Taskforce and Taskforce for Nature-related Financial
Disclosures and impact of these on the Company; and
• discussed the UK Taxonomy and impact of this on the Company.
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ATTENDANCE AT MEETINGS
• discussed progress on the assessment and feasibility in setting a Net Zero Carbon target in line with the Company’s
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Governance reportGovernance report
Placemaking and sustainability committee report / continued
ACTIVITIES OF THE COMMITTEE RELATING TO THE THREE THEMES FORMING THE OVERALL STRATEGY
STRATEGIC THEME
RELATED ACTIVITIES OF THE COMMITTEE
• Discussed of the new Biodiversity Net Gain Target and received an update of the
Company’s biodiversity strategy;
• discussed National Planning and Design Policy matters;
• received an update on the Redrow Design and Layout Seminar;
• discussed the post-completion placemaking audits and reviewed the Redrow 8 and
layout review process; and
• received an update on the community collaboration and consultation project.
• Reviewed the overall Health, Safety and Environmental (“HS&E”) performance;
• reviewed the latest Customer Satisfaction KPIs and strategic projects;
• reviewed the Group’s SBTi validated Greenhouse Gas emissions targets of reducing
absolute scope 1 and 2 GHG emissions 42% by 2030 from a 2021 base year and
absolute scope 3 GHG emissions 25% within the same timeframe;
• discussed the ongoing work to submit a long-term net zero carbon target and
initiatives around this;
• discussed the findings of the air source heat pump trial project;
• discussed the 5 Star Status awarded to Redrow for the 5th year running by the Home
Builders Federation;
• received an update on the activities of the Virtual Homeowner Support Team;
• discussed the ongoing work relating to the Future Homes Standard;
• received an update on the charitable activities of the Group; and
• received an update on the engagement work with the supply chain.
• Received an update regarding feedback from the 2023 INsight survey, the workforce
engagement sessions chaired by Nicky Dulieu and the divisional Engagement Groups;
• discussed the employee turnover and initiatives to align this figure with targets;
• received an update colleague benefits and the communication of these;
• received an update on the Group’s Equality, Diversity and Inclusion agenda;
• received an update in respect of learning and development across the Group; and
• discussed the work undertaken in developing the Company’s Green Academy.
P E R F O R M A N C E E VA LUAT I O N
G OV E R N A N C E S T R U C T U R E F O R S U S TA I N A B I LI T Y
After reviewing the 2022 externally facilitated evaluation
report, a questionnaire was created and tailored, taking
into consideration comments made in the previous year’s
assessment as well as the current market.
The questionnaire was completed by all Members of the
Committee and its regular attendees. Following completion
of the Committee assessment questionnaire, an
anonymised effectiveness report was compiled and
presented to the Members of the Committee.
The evaluation found that the Committee has effectively
performed its responsibilities and that it receives the right
quality of external advice. It was agreed that a Board
discussion was to be had regarding the remit and
objectives of the Committee to ensure that it has the right
focus and balance.
164
Having discussed the findings of the evaluation, the
Committee was found to be effective, concluding that it
had fulfilled its remit and had in place appropriate Terms of
Reference.
The Group’s sustainability strategy drives long-term value
for its stakeholders and allows the Group to minimise risks
and identify opportunities for growth. The sustainability
strategy is built around the Group’s three pillars: Building
Responsibly, Thriving Communities and Valuing People.
Each of the three pillars have areas of focus that set out
separate objectives and targets relating to the current
strategy. As part of the Group’s drive for continuous
improvement, objectives and targets are monitored and
reviewed against the over-arching business strategy.
There is a strong governance structure in place
surrounding the Group’s sustainability strategy which
ensures that initiatives, objectives and targets are
reviewed and approved at the appropriate levels within the
organisation. The governance structure for sustainability
which was in place during the 2023 financial year is
displayed opposite:
B OA R D
1
PA S C C O M M I T T E E
2
W O R K F O R C E
E N G AG E M E N T
G R O U P
(Chaired by Nicky Dulieu)
4
S U S TA I N A B I L I T Y
T E A M
8
E X E C U T I V E
M A N AG E M E N T T E A M 3
W O R K I N G /
S T E E R I N G G R O U P S
9
B U I L D I N G R E S P O N S I B LY
R E G I O N A L C H I E F E X E C U T I V E
T H R I V I N G C O M M U N I T I E S
G R O U P C O M M U N I T I E S D I R E C TO R
VA LU I N G P E O P L E
H U M A N R E S O U R C E S D I R E C TO R
5
6
Working safely
& considerately
Sponsored by
RCE Western
Putting our
customers first
Sponsored by
RCE Western
Managing
our resources
Sponsored by
RCE Western
Creating better
places to live
Sponsored by
Group Communities
Director
Valuing &
developing
our people &
partners
Sponsored by
Human Resources
Director
Inspiring the
next generation
to build
Sponsored
by Human
Resources
Director
Initiatives led by
Group Health Safety
& Environment
Director and Group
Construction
Director
Initiatives led by
Group Customer and
Marketing Director
Initiatives led by
Group Commercial
Director,
Group Construction
Director and Group
Sustainability
Director
Initiatives
led by Group
Masterplanning
Director and Group
Sustainability
Director
Initiatives led by
Human Resources
Director
Initiatives led by
Human Resources
Director
D I V I S I O N S
7
1. Ultimate responsibility
3. Delegated authority from
for sustainability and ESG
matters. Oversight of the
sustainable business
strategy framework.
2. Delegated authority from
the Board to monitor
the execution of the
sustainability strategy, as
approved by the Board, and
to make recommendations
from time to time to the
Board.
the Board to ensure that the
sustainability strategy and
ESG are integrated within
the Business. The Board
sponsor for Sustainability,
being the Group Chief
Executive, also sits on the
EMT and is accountable
to PASC and the Board for
ensuring that the structure is
governed effectively.
4. Meet twice per year. Nicky
Dulieu, as the Designated
NED for Workforce
Engagement, chairs these
meetings and reports to
the Board on key outcomes.
5. Sponsors are responsible
for overseeing the
delivery of strategic aims
and initiatives within each
area of focus.
6. Initiative leads are
responsible for the delivery
of initiatives of targets and
embed related procedures
within the business.
7. Divisions must comply with
procedures and to assist
in delivering initiatives
and targets efficiently
and effectively. Managing
Directors are accountable
to ensure that any outcomes
from the strategy and
initiatives are embedded
within the business and
followed.
8. The Sustainability team
administers the structure
and supports Board
Sponsor and EMT to deliver
it. Provides strategic advice,
target setting and reporting;
long-term risk and policy
management.
9. Working/Steering Groups
are set up based on
the needs and focus
of the business. These
groups are comprised of
subject matter experts
from within the business.
There is a nominated lead
sponsor for each group
who shall report to the
EMT as appropriate. The
groups meet as often as
necessary and exist until
the particular project has
completed or the business
need has been met.
Richard Akers
Chair of the Placemaking and Sustainability Committee
15 September 2023
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Redrow plc Annual Report 2023Redrow plc Annual Report 2023Governance reportGovernance report
Directors' remuneration report
DIRECTORS' REMUNERATION
REPORT
I am pleased to present the
Directors’ Remuneration Report
for the 52 weeks ended 2 July
2023.
Nicky Dulieu
Chair of the Remuneration Committee
As in previous years, this remuneration report is split into
three sections:
• Annual Statement – in my letter I set out the key items
considered by the Remuneration Committee during the
year. It includes the executive directors’ remuneration
outcomes for the 52 weeks ended 2 July 2023 and the
context in which pay decisions were made.
• Directors’ Remuneration Policy (the Policy) – our Policy
was approved by shareholders at the 2021 AGM and we
have now entered into the final year of the three-year
Policy. There are no changes proposed to the Policy and
we have included a copy in this report for ease of
reference.
• Annual Report on Remuneration – this section describes
in further detail the pay outcomes in respect of 2023 and
the proposed implementation for the 2024 financial year.
It also includes CEO pay ratio reporting and other
disclosures including executives’ shareholdings and
historic pay outcomes.
P E R F O R M A N C E O U TC O M E S F O R T H E Y E A R E N D E D
2 J U LY 2 02 3
Business context
Redrow’s proven business model has played an important
role during a time of significant political and economic
uncertainty. After a strong first quarter the market was
significantly impacted by political events in the second
quarter which resulted in a steep rise in mortgage rates.
Against this backdrop of considerable uncertainty we still
managed to deliver total revenue of £2.1bn, in line with last
year. Furthermore, despite ongoing build cost inflation and
lower build rates our underlying profit before tax was
£395m, compared to £410m in 2022.
We completed 5,436 homes in the year. Whilst this was a
5% reduction on the 2022 financial year (2022: 5,715),
revenue was stable due to the increase in average selling
price. This reflects both the differentiation of our Heritage
range of family homes in primary locations, which
differentiates us from both new build competitors and the
much larger second hand market and, secondly, our focus
on placemaking which enables thriving communities to
develop.
As a result of our land investment in 2021 we increased the
average number of outlets over the 2023 financial year to
117 and we expect to maintain this position during the 2024
financial year. We remain in a strong positive cash position,
ending the financial year with £235m net cash excluding
lease liabilities (2022: £288m). This is despite the fact we
have returned £100m to shareholders in the form of a share
buyback programme.
Building Responsibly remained a key pillar of our strategy
in 2023. This was demonstrated by maintaining excellent
health and safety levels; demanding high environmental
standards as we became the first large housebuilder to
announce that we would be installing air source heat
pumps into all our homes on upcoming developments; and
building quality homes that enhances our reputation in the
market as evidenced by ‘Excellent’ Trustpilot ratings and
five-star HBF ratings.
Wider employee pay at Redrow
Ongoing cost-of-living pressures continue to impact our
employees and the Committee has been pleased with the
Executives’ response to address this in the context of a
challenging trading environment. Last year we gave a 5%
salary uplift to all employees and all employees will receive
an increase of at least 3% in 2024. The Company reviewed
employee pension contributions during the year and
166
concluded that this was an area that should be enhanced.
Accordingly, from 1 January 2023 the pension contribution
rate was increased from 7% to 10% of salary for all monthly
paid employees. At Redrow, 864 monthly paid employees
are eligible to participate in the Universal Bonus scheme.
The actual payout for the year was low (average of 1.84% of
salary) but recognising the current pressures facing our
more junior employees, the Board decided to pay the
bonus out in full (5% of salary) to all eligible participants in
September 2023.
In line with Provision 40 of the Code, during the year there
was a section of the second employee engagement
session, led by myself as the designated Non-Executive
Director for workforce engagement, that was dedicated to
engagement regarding the remuneration arrangements of
the Executive Directors. This ensured that such
arrangements remain transparent and gave employees the
opportunity to provide their feedback relating to
remuneration.
2023 annual bonus
The bonus scheme was based on 5 metrics – profit before
tax (50%), outlets opened (20%), customer service (12.5%),
health and safety (12.5%) and a diversity-based ESG
measure (5%).
• Profit: Reflecting the challenging political and economic
turbulence experienced during the year, the profit
threshold was not met;
• Customer Service: the customer service threshold was
also not achieved reflecting the stretching nature of the
targets following the change in measurement
implemented in 2022;
• Outlets opened: 31 outlets were opened during the year
which was equal to the maximum target and therefore
resulted in a full payout;
• Health and Safety: The accidents per number of homes
built was between threshold and maximum leading to a
partial payout; and
• ESG: Significant progress was made on diversity and
inclusion objectives, resulting in this objective being met.
Overall, this resulted in a payout of 35.9% of maximum. The
Committee considers the lower bonus outcome this year to
be consistent with the overall stakeholder experience and
a fair reflection of management’s commendable
performance in very uncertain times.
Further detail of the measures, targets and performance is
set out in the Annual Report on Remuneration. In line with
our policy half of the annual bonus will be deferred in
shares.
2020 LTIP vesting
The EPS and ROCE targets attached to the LTIP were set in
December 2020 in the midst of the pandemic and were
stretching in the context of the outlook at the time. Post
pandemic, the Group’s recovery was encouraging with the
Group recording underlying EPS of 96.0p in FY22. FY23
has been more challenging for reasons set out above and
overall, EPS and ROCE performance has been just above
the maximum targets set, resulting in full vesting based on
formulaic outcomes.
The Remuneration Committee has discretion to adjust the
number of shares vesting from the award if it considers that
the vesting outcome is not sufficiently reflective of the
underlying performance of the Company and to the extent
it believes there have been windfall gains. The Committee
considers the overall three-year performance of the
business in the context of the recovery from the pandemic
to have been strong and reflective of the actions of the
management team. Therefore, the Committee has agreed
that the vesting outcome is warranted, particularly in the
context of nil LTIP vesting in 2020 and 2021, partial 24%
vesting in 2022 (all impacted by the pandemic) and
anticipated nil vesting in 2024 due to the reasons outlined
below. The awards were granted at a price of 405 pence
and the estimated vesting price is c.20% higher. The
Committee does not believe this constitutes a windfall gain
that requires an adjustment to the vesting level.
The Remuneration Committee has not applied any
discretion to amend the bonus and LTIP results. Overall,
the Remuneration Committee believes the outcomes under
the bonus and LTIP are fair and reasonable. The annual
bonus outcome is aligned with the stakeholder experience
in a difficult year and vesting under the LTIP reflects the
Group's recovery from the impact of the pandemic and
management’s actions.
T E R M S O F T H E 2 02 2 LT I P AWA R D
On 1 September 2022 the Remuneration Committee met to
set the performance conditions applying to the 2022 LTIP
grant and approved stretching EPS, ROCE and Carbon
reduction targets that reflected the prevailing internal and
external outlook. The measures and targets were disclosed
in last year’s report which was signed off on 13 September
2022 and the award was made a week later on 21
September 2022.
On 15 September 2022, the Government announced that
the Mini-Budget would take place on 23 September, just
two days after the LTIP grant was made. The Mini-Budget
created an immediate and significant economic shock, one
effect of which was to lead to a dramatic increase in
mortgage pricing. This in turn dented customer confidence
which translated into a material reduction in the number of
reservations. The shock to the market and the subsequent
impact on housebuilders was unexpected and a direct
result of the Government’s Mini-Budget.
This created a number of business risks for Redrow and,
from a people perspective, the Committee was very
concerned with the Mini-Budget’s impact on the 2021 and
2022 LTIP awards which were no longer achieving their
purpose – to motivate sustained performance and retain
key staff. The impact resulted in it being highly unlikely that
either of these awards would achieve their performance
targets and this would create a fallow period in 2024 and
2025 and a retention risk to the business. Furthermore, the
financial measures and targets set by the Committee were
incentivising management to grow the business which was
no longer in the best interests of shareholders during the
period of heightened uncertainty.
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Redrow plc Annual Report 2023Redrow plc Annual Report 2023Governance reportGovernance report
Directors' remuneration report / continued
Churchlands, Lisvane,
Cardiff.
The Committee was determined to address these risks and,
given the 2022 grant was made just two days prior to the
Mini-Budget, and in order to ensure it motivated the
management team and remained an appropriate incentive
over the 3-year performance period, the Committee
revisited the terms of the 2022 award around 6 months
following the grant of the awards.
The EPS and ROCE measures (with an aggregate weighting
of 90%) were replaced with a relative Total Shareholder
Return (TSR) condition with the Carbon reduction measure
(10%) remaining unchanged. The Committee understands
the challenges and optics with revisiting terms of LTIP
awards but on this occasion felt that this was warranted for
the following reasons:
• The Remuneration Committee identified the risk early
and took swift action to address the issue by revising the
most recently granted LTIP award only. Achieving the
original EPS and ROCE targets would have required
management to take actions which were not in line with
the Board’s strategy and would have incentivised
inappropriate risk-taking.
• The number of LTIP awards were reduced by 1/6th to
reflect the change in performance measure which took
place six months into the 36-month vesting period.
• The TSR measure requires management to take a
balanced view on risk and shareholder returns and
therefore was considered to be an appropriate measure
in the circumstances. TSR is measured against a peer
group of other housebuilders who were similarly
impacted by the Mini-Budget and any vesting is by no
means guaranteed with the Company tracking at median
(5th out of 9) against the peer group at the time of the
change. As a result, this is considered to be a ‘neutral’
change and no less challenging than the original EPS/
ROCE targets at the time the Committee set them.
• There will be no amendment to the in-flight September
2021 LTIP award for which a significant proportion of the
3-year performance has elapsed and therefore this
award which was performing strongly, is now expected to
lapse. Furthermore, the 2022/23 bonus as set out earlier
was significantly impacted and delivered a relatively low
outturn as a result.
Furthermore, two new underpins will apply to the 2022
award to ensure stakeholder interests are protected:
• Notwithstanding performance against the relative TSR
measure, the Remuneration Committee will apply
appropriate negative discretion if absolute TSR between
the date of change of the performance conditions and
vesting is negative.
• The Committee may reduce vesting to reflect the wider
stakeholder experience and in doing so will consider the
experience of our employees, customers, and suppliers.
The Committee communicated this change to leading
investors and is grateful for the written support received
from those who responded.
I M P LE M E N TAT I O N O F P O LI CY I N 2 02 3 / 2 4
Base salary
Barbara Richmond joined Redrow over 13 years ago and is
the longest serving CFO amongst FTSE350 UK-listed
housebuilders. Her extensive track record includes
successfully navigating our business through economic
cycles and major financial and macro incidents including
the credit crunch and the pandemic and she has been
instrumental in ensuring our proven business model is
sufficiently prudent and robust at a time of significant
political and economic uncertainty.
It is clear from our interactions with investors that Barbara
is held in very high regard and should be retained and
rewarded appropriately. The Committee has considered
her value to the business, her extensive responsibilities,
and the potential cost of replacing Barbara with a finance
director of similar calibre, noting that Barbara is the longest
serving CFO in the sector and 4 out of the 7 other FTSE
350 housebuilders have recently changed their CFO. In the
light of this, the Committee has concluded that a more
material salary adjustment is required, increasing Barbara’s
base salary from £400,600 to £470,000. As a secondary
check, the Committee considered the proposed salary
level against market benchmarks and took comfort that
Barbara’s proposed salary would be broadly in line with
market data in the sector.
However, as the financial year drew to a close the
Committee felt that such an increase at the current time
given the challenges facing the business was not
appropriate and agreed, subject to continued strong
performance in the role, to defer the increase to 1 July
2024.
Accordingly, both Matthew Pratt and Barbara Richmond will
receive a salary increase of 3% from 1 July 2023 which is in
line with the minimum workforce increase applying to all
employees.
Pension provision
The CEO’s and CFO’s pension is workforce aligned at 10%
of salary.
Annual bonus
For FY24, a bonus maximum in line with the approved
policy of 150% of salary will apply to both executive
directors. The weighting on the financial performance has
been increased with profit before tax applying to 65% of
the bonus (up from 50%). The measure based on the
number of outlets opening has been removed as the focus
has shifted away from buying land at the current time.
Customer Service, Health and Safety and ESG objectives
relating to diversity will continue to feature. The actual
targets will be disclosed on a retrospective basis in next
year’s report.
Long term incentives
The Remuneration Committee considers the share price at
the time of grant and based on the current price it is
expected that awards will be granted to executive directors
with a face value of 150% of salary, which remains modest
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against other housebuilders and companies of a similar
size.
For the 2023/24 grant, the metrics will be EPS, ROCE,
relative TSR and Carbon reduction. The inclusion of a
relative TSR measure reflects the support received from
shareholders during the consultation to change the terms
of the 2022 award. Full details of the weightings and
targets for each metric are set out in the Annual Report on
Remuneration.
D I R E C TO R S ’ R E M U N E R AT I O N P O L I C Y R E V I E W
We have entered into the final year of the three-year Policy.
Over the course of the year the Committee will review the
terms of the Policy to ensure we remain compliant with
good practice, have incorporated the latest views of
shareholders and to ensure the Policy supports the
business’s commercial goals. We will consult with
shareholders on any changes we propose making.
I hope that you have found this annual statement
informative and clear and that you will be supportive of the
advisory remuneration resolution at the upcoming AGM. I
am keen to keep open dialogue with shareholders and if
you would like to provide any feedback, please contact me
via the Company Secretary.
NICKY DULIEU
Chair of the Remuneration Committee
This report has been prepared in accordance with the UK Corporate Governance
Code, the relevant provisions of the Listing Rules and Schedule 8 of the Large
and Medium-sized Companies and Groups (Accounts and Reports) (Amendment)
Regulations 2013.
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Directors' remuneration report / continued
DIRECTORS' REMUNERATION
POLICY
This part of the Directors’ Remuneration Report sets out
the Directors’ Remuneration Policy (“the Policy”) for the
Group and has been prepared in accordance with
Schedule 8: The Large and Medium sized Companies and
Groups (Accounts and Reports) (Amendment) Regulations
2008 (as amended) and the UK Listing Authority’s Listing
Rules. This Policy was approved by shareholders at the
November 2021 Annual General Meeting and has a
three-year life. The Policy set out in this report remains
unchanged from that published in the 2021 Annual Report
except for updates to the Illustration of Remuneration
Policy chart, the Policy table to reflect a change to the
employee pension contribution rate and to the service
contracts section to update for changes to Board
composition.
Remuneration strategy
The Remuneration Committee designed the Policy with the
following aims in mind:
• executive directors are rewarded fairly and competitively
for the delivery of strong performance;
• it takes into account the need to attract, retain and
motivate executives of a high calibre and to provide an
appropriate balance between short and long-term
incentives;
• it considers a range of factors including competitiveness
against our peers, market practice, the performance of
the Group, the calibre of the executive team and
remuneration practices elsewhere in the Group; and
• incentive schemes are subject to stretching performance
criteria with full vesting or payouts requiring exceptional
performance.
In seeking to achieve the above objectives, the Committee
is mindful of the views of a broad range of stakeholders in
the business and accordingly takes account of a number of
factors when setting remuneration. This includes market
conditions, pay and benefits in relevant comparator
organisations, terms and conditions of employment across
the Group, the Group’s risk appetite, the expectations of
institutional shareholders and feedback from shareholders
and other stakeholders. Whilst the views of other
stakeholders are considered as part of the process, the
Committee manages any potential conflicts of interest and
retains the ultimate decision making authority.
This Policy has considered guidance provided by investors
and proxy voting agencies. We have also taken into
account the principles and provisions of the 2018 UK
Corporate Governance Code and in particular the following
six factors:
Clarity
• The Policy has a clear aim; to incentivise and reward for
the delivery of our strategy
• The Policy is well understood by our Directors and senior
executives
• Each component of remuneration is clearly explained in
the Policy table, including its purpose, how it is operated,
the maximum potential and any relevant performance
measures
• Full disclosure of performance measures and
assessments is provided for shareholders’ consideration
Simplicity
• The Policy reflects standard UK market practice, with the
operation of an annual incentive and a single long-term
share plan, full details of which are set out in the Policy
table
• All payments are in the form of cash or Redrow plc
shares, there are no artificial structures used to deliver
remuneration
Risk
• The Policy and our approach to target setting seek to
discourage any inappropriate risk-taking
• The Committee has the ability to use its discretion to
override the formulaic outturns of the incentive plans if it
is felt appropriate
• Comprehensive malus and clawback provisions operate
in both incentive plans, providing the ability to recover or
withhold payments if appropriate
Predictability
• Appropriate individual (and where necessary aggregate)
limits are set out in the Policy and within the respective
plan rules so outcomes can be predicted
• The possible reward outcomes under different
performance scenarios are shown in the “Illustration of
Remuneration Policy” section included in the Policy
• In operating the Policy, the Committee continually
monitors the performance of in-flight incentive awards so
that it is well aware of potential outcomes
Proportionality
• The outcomes of our incentive plans are directly aligned
to the delivery of our strategy. Outcomes are assessed
against multiple metrics to ensure performance is
considered on a broad basis
170
• Outcomes are assessed against multiple metrics to
ensure performance is considered on a broad basis
• The Committee has the ability to use its discretion to
override the formulaic outturns of the incentive plans if it
is felt appropriate
Alignment with culture
• A key focus of our Policy is to promote long-term
sustainable performance which is reflective of the
business culture
• Incentive outcomes rely on strong performance across a
broad selection of measures which are important to our
stakeholders
Policy table for Executive Directors
P E R F O R M A N C E
F R A M E W O R K
Executive Directors’
performance is a factor
considered when determining
salaries.
No recovery or withholding
provisions apply.
C O M P O N E N T A N D
L I N K TO S T R AT E GY
Base salary
To provide a market
competitive element of
fixed remuneration to
attract and retain leaders
of the required calibre to
deliver the strategy.
O P E R AT I O N
M A X I M U M
Salaries are determined by
the Committee taking into
account all relevant factors
such as: the size and
complexity of the Company,
the scope and
responsibilities of the role,
the skills and experience of
the individual and
performance in role.
The salary review for
executive directors takes a
range of factors into
consideration, including:
• Business performance
• Salary increases awarded
to the wider employee
base
• Skills and experience of
the individual and
development over time
• Scope of the individual’s
responsibilities
• An assessment of the
market positioning
considering UK
companies of similar size
and companies in the
sector.
Salaries are normally
reviewed annually, with any
changes normally effective
from the start of the
financial year.
Whilst there is no
prescribed maximum salary,
any increases will take into
account prevailing market
and economic conditions
and the approach to pay
throughout the wider
workforce.
Base salary increases are
awarded at the discretion
of the Committee; however,
salary increases will
normally be no greater than
the general increase
awarded to the wider
workforce, in percentage of
salary terms.
The Committee has
discretion to award larger
increases where it
considers this appropriate,
such as to reflect (for
example):
• a significant change in the
size and complexity of the
Company;
• an increase in scope and
responsibility of the role,
or a change in role;
• an Executive Director
being moved to market
positioning over time; and
• an Executive Director
falling below competitive
market positioning.
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O P E R AT I O N
M A X I M U M
Benefit provision, for which
there is no prescribed
monetary maximum, is set
at an appropriate level for
the specific nature and
location of the role. The
value of each benefit is
normally based upon the
cost to the Group.
Participation in all
employee share plans is
subject to statutory limits in
place at the time.
P E R F O R M A N C E
F R A M E W O R K
N/A
C O M P O N E N T A N D
L I N K TO S T R AT E GY
Annual Bonus
A variable pay
opportunity which
motivates and rewards
annual financial
performance and
delivery of the strategy
on an annual basis.
Deferral aligns reward
with long term value of
Redrow shares and
provides retention.
Directors' remuneration report / continued
Benefits may include: a
company car (or equivalent
cash allowance), private
medical insurance,
permanent health
insurance, fixed term group
income protection and a
death in service benefit,
and where appropriate any
tax payable thereon.
Executive Directors may
also participate in all-
employee share plans on
the same basis as other
employees.
The Committee has
discretion to include, where
it considers it appropriate
to do so, other benefits to
reflect specific individual
circumstances, such as
housing, relocation, travel,
or other expatriate
allowances.
Expenses incurred in
respect of the performance
of duties for the Company
may be reimbursed or paid
for by the Company,
including any tax due on
such payments.
Individuals are eligible to
participate in the
Company’s Defined
Contribution (DC) pension
scheme or receive a
pension allowance cash
supplement in lieu.
Executive Directors who
are members of the
Company’s Defined Benefit
(DB) pension scheme will
continue to receive
benefits under the terms of
that scheme. There will be
no new entrants or accrual
of future benefits under the
DB scheme.
C O M P O N E N T A N D
LI N K TO S T R AT E GY
Benefits
To provide a market
competitive benefits
package to support the
Director in fulfilling their
role.
Pension
To provide a market
competitive element of
fixed remuneration for
retirement planning.
172
N/A
The maximum company
contribution (in respect of a
financial year) is 20% of
base salary. From 1 January
2023, all executive
directors have a pension
contribution rate of no
more than the workforce
rate.
Any new executive
directors appointed to the
Board will have a maximum
pension contribution equal
to the workforce rate.
The workforce rate was 7%
of salary and increased to
10% of salary from 1 January
2023.
O P E R AT I O N
M A X I M U M
The maximum annual bonus
opportunity is 150% of
salary for executive
directors. A 125% of salary
maximum will apply for the
first financial year of the
policy period (2021/2022)
and a 150% of salary limit
will apply to future years
under the Policy.
Bonuses are determined
based on measures and
targets that are agreed by
the Committee. Bonus is
based on performance over
the relevant financial year.
Half of any bonus earned
will be deferred into
Redrow shares which vest
after one year and two
years, subject to continued
employment.
Following exercise of a
vested deferred share
award, participants will be
entitled to receive an
amount equal to the
aggregate of any dividends
which they would have
been entitled to receive as
a shareholder during the
period between the grant
and satisfaction of the
award. In exceptional
circumstances (for example,
in limited situations where
it may not be possible to
grant a share award due to
technical reasons), the
Committee may determine
that deferral is in the form
of an equivalent cash
award (which in all other
respects mirrors the terms
of the deferred share
awards). It is not anticipated
that a cash award will be
made. Malus and clawback
provisions apply to both
the cash and deferred
elements.
P E R F O R M A N C E
F R A M E W O R K
Performance measures are
determined by the Committee
each year and may vary to
ensure they promote and are
aligned with the Company’s
business strategy.
Performance is assessed
against key financial and
non-financial performance
measures linked to the delivery
of the strategy and shareholder
value determined each year by
the Committee. The 2023/24
performance measures are set
out on page 180.
The Committee retains
discretion to adjust the
measures and/or weightings in
future years to reflect prevailing
financial, strategic and
operational objectives of the
business or of the individual.
However, a minimum of 50% of
the total will be based on key
financial measures.
No bonus will be payable for
performance below threshold
levels set by the Committee.
Where a sliding scale of targets
applies to financial measures,
typically up to 20% of that
element may be payable for
threshold performance.
The Committee has discretion
to adjust the level of payout if
the outcome from a formulaic
assessment does not
appropriately reflect underlying
business performance.
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C O M P O N E N T A N D
LI N K TO S T R AT E GY
Long Term Incentive
Plan (LTIP)
Designed to motivate
and reward long-term
performance and
delivery of the strategy
and provide alignment
with Redrow
shareholders.
P E R F O R M A N C E
F R A M E W O R K
The LTIP is based on
performance measures aligned
to the creation of long-term
shareholder value, normally
measured over a performance
period of at least three years.
The current performance
measures are set out in the
Annual Report on Remuneration.
For threshold performance, 20%
of the awards would normally
vest.
The Committee retains
discretion to include additional
or alternative financial
performance measures and/or
adjust the weightings in future
years to reflect prevailing
strategic or operational
objectives of the business
aligned with shareholder value
creation.
Performance conditions
applicable to LTIP awards may
be amended if an event occurs
which cause the Committee to
consider that an amended
performance condition would
be more appropriate and not
materially less difficult to satisfy.
O P E R AT I O N
M A X I M U M
The maximum award which
may be granted in respect
of a financial year will
normally not exceed 150%
of salary.
In exceptional
circumstances, the
Committee may make
awards of up to 200% of
salary.
Awards are normally
granted to Executive
Directors annually in the
form of nil-cost options.
The Committee may also
determine that awards are
made in the form of
conditional share awards or
in exceptional
circumstances, as an
equivalent cash award (for
example, in limited
situations where it may not
be possible to grant a
share award due to
technical reasons) (which in
all other respects mirrors
the terms of the LTIP).
Awards normally vest after
a period of three years
subject to the satisfaction
of performance conditions.
Vested awards will be
subject to an additional
holding period which
requires awards to be
retained for a period of two
years from the end of the
vesting period, except for
shares sold to pay personal
tax upon vesting/exercise.
Awards may incorporate
the right to receive the
aggregate value of
dividends paid on vested
shares between the vesting
date and the date on which
the awards are released
following the holding
period, on such basis as
the Committee may
determine, which may
assume the reinvestment of
these dividends in shares
on a cumulative basis.
Malus and clawback
provisions apply.
174
P E R F O R M A N C E
F R A M E W O R K
N/A
C O M P O N E N T A N D
L I N K TO S T R AT E GY
Share Ownership
Guidelines
Encourage Executive
Directors to build a
meaningful shareholding
in the Group so as to
further align their
interests with those of
shareholders.
O P E R AT I O N
M A X I M U M
Executive Directors are
required to retain all share
awards vesting as shares
(after the sale of any shares
to settle tax due) until they
have reached the required
level of holding.
Shares owned outright by
the Executive Director or a
connected person are
included. Shares or share
options which are subject
to a performance condition
are not included. Unvested
deferred bonus shares and
vested LTIP awards which
remain unexercised may
count towards the in-
employment guideline on a
net of tax basis.
During employment:
Executive Directors are
required to build and
maintain a shareholding
equivalent to at least 200%
of their base salary.
Post employment:
Executive Directors are
normally required to hold
shares at a level equal to
the lower of their
shareholding at cessation
and 200% of salary for two
years post cessation
(excluding shares
purchased with own funds
and any shares from share
plan awards granted before
the approval of this policy).
The Remuneration
Committee believes this is
appropriate to ensure
executives are not
discouraged from
purchasing Redrow shares.
The Committee reserves the right to make any
remuneration payments and payments for loss of office
(including exercising any discretions available to it in
connection with such payments) notwithstanding that they
are not in line with the Remuneration Policy set out above
where the terms of the payment were agreed (i) before 10
November 2014 (the date the Company’s first shareholder
approved Remuneration Policy came into effect); (ii) before
the Remuneration Policy set out above came into effect,
provided that the terms of the payment were consistent
with the shareholder-approved Remuneration Policy in
force at the time they were agreed; or (iii) at a time when
the relevant individual was not a director of the Company
and, in the opinion of the Committee, the payment was not
in consideration for the individual becoming a director of
the Company. For these purposes “payments” includes the
Committee agreeing awards of variable remuneration and,
in relation to an award over shares, the terms of the
payment are “agreed” at the time the award is granted. The
Committee may make minor amendments to the
Remuneration Policy (for regulatory, exchange control, tax
or administrative purposes or to take account of a change
in legislation) without obtaining shareholder approval.
Choice of performance measures and target setting
For the annual bonus and LTIP, performance measures are
chosen which help to drive and reward the achievement of
the Group’s strategy and also provide alignment between
employees and shareholders. The Committee reviews
measures each year to ensure they remain appropriate and
reflect the future strategic direction of the Group. Targets
for each performance measure are set by the Committee
with reference to internal plans and external expectations.
Performance is typically measured on a ‘sliding scale’ so
that incentive payouts increase pro-rata for levels of
performance in between the threshold and maximum
performance targets.
Consideration of employment conditions elsewhere in
the Group
The principles applied to the remuneration of Executive
Directors are essentially the same as those for the Group.
The difference between pay for Executive Directors and
employees is that for Executive Directors the variable pay
element forms a greater proportion of the overall package
and the total remuneration opportunity is higher to reflect
the increased responsibility of the role. While remuneration
practices vary across the full employee population, they
are based on the same broad principles which underpin
the policy for Executive Directors set out above.
The Remuneration Committee is regularly briefed on pay
and employment conditions across the Group and takes
this into account when setting directors’ remuneration.
Employees’ salary levels are determined by taking into
account prevailing industry rates and the Remuneration
Committee takes into account the workforce salary
increase when determining the increases that should apply
to Executive Directors’ salaries.
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Directors' remuneration report / continued
The Workforce Engagement group provides feedback to
the nominated non-executive director for workforce
engagement on employment conditions and pay.
The Company operates a SAYE scheme available to all
employees with the ability to become shareholders in the
Company and thereby providing the ability to comment on
executive directors’ pay as with all other shareholders.
Employees can raise issues through the divisional
engagement groups and the national Workforce
Engagement group, at performance appraisals and can
write directly to the nominated non-executive director by
email.
When setting the Remuneration Policy for Executive
Directors, the Committee has regard to the pay and
employment conditions of employees within the Group.
The Committee did not consult directly with employees
when formulating the Remuneration Policy for Executive
Directors. The Committee considers salary increases within
the business but does not formally consider any other
comparison metric.
Consideration of shareholder views
The Committee engaged with all major independent
shareholders and shareholder advisory groups, when
developing this Remuneration Policy. Views expressed
during this engagement were taken into account by the
Committee and helped shape the final proposals. The
Committee subsequently informed all of those consulted of
the revised changes as a result of the consultation and the
final proposed Policy. The Committee is grateful for the
feedback received.
Clawback
For awards under the annual bonus plan (including
deferred share awards) and awards made since the
introduction of the 2014 LTIP, the Committee has discretion
to clawback awards in the event of a material misstatement
of the Company’s audited financial results or employee
misconduct. Awards made from 2019/20, included
additional triggers relating to an error in the calculation of
a performance condition and circumstances which the
Committee considers sufficient to have, or had potential to
have, caused reputational damage will also apply.
In such circumstances, at any time prior to the fifth
anniversary of the payment of any cash bonus or vesting of
a deferred bonus/LTIP award, the Committee has discretion
to:
• reduce, cancel or impose further conditions on
outstanding deferred bonus/LTIP awards; or
• require the participant to repay (in cash or shares) some
or all of the value delivered from a deferred bonus/LTIP
awards; and/or
• require the participant to repay some or all of any cash
bonus received.
For deferred bonus plan awards, in the event of a material
misstatement of the Company’s audited financial results or
employee misconduct, any unexercised awards will lapse
immediately and the participant will forfeit any shares
previously acquired under awards made under that plan.
Corporate events
Unvested awards under the deferred bonus plan and LTIP
will normally vest early in the event of a takeover or
winding-up of the Company and, in the case of the
deferred bonus plan, if the Company goes into
administration or a voluntary arrangement is proposed with
its creditors. In these circumstances, deferred bonus
awards vest in full and LTIP awards vest taking into account
the relevant performance conditions and, unless the
Committee determines otherwise, time pro rata to reflect
the proportion of the performance period that has elapsed.
Awards may also be rolled over for equivalent awards in a
different company. If the Company is or is likely to be
affected by a demerger, special dividend, delisting or other
event which in the Committee’s opinion, may affect the
current or future value of the Company’s shares, the
Committee may allow some or all of the awards to vest. The
extent to which LTIP awards vest in these circumstances
will be calculated on the same basis as set out above for a
takeover. The terms of awards may be (a) in the event of
any variation of the Company’s share capital, delisting,
special dividend or distribution, demerger or other event
which may in the Committee’s opinion, affect the current or
future value of the Company’s shares, adjusted or (b)
amended in accordance with the plan rules.
Illustration of Remuneration Policy
The charts opposite illustrate the potential value of the
remuneration packages for the Executive Directors under
the following scenarios (no share price growth is assumed):
• Minimum – reflects fixed pay only (base salary and
pension contributions as at 1 July 2023 and benefits
included using the disclosed values for the year ended 2
July 2023);
• Target – reflects fixed pay, target bonus (75% of salary)
and LTIP awards vesting at threshold (i.e. 20% of
maximum);
• Maximum – reflects fixed pay, maximum bonus (150% of
salary) and maximum LTIP awards (being 150% of salary
for the CEO and CFO); and
• Maximum plus share price growth – as for Maximum
above, but with the value of 50% share price growth
included within the LTIP element.
176
I L LU S T R AT I O N S O F A P P LI C AT I O N O F R E M U N E R AT I O N P O L I C Y ( £ ’ 0 0 0 )
100%
£777
54%
27%
23%
36%
10%
£1,486
36%
31%
37%
31%
£2,804
M I N I M U M
O N -TA R G E T
M A X I M U M
15%
£3,311
M A X I M U M W I T H G R O W T H
C E O
100%
£493
56%
%
35% 9
£926
29%
35%
36%
£1,731
M I N I M U M
O N -TA R G E T
M A X I M U M
25%
30%
30%
15%
£2,040
M A X I M U M W I T H G R O W T H
C F O
Total Fixed Remuneration
Annual Bonus
LTIP
Share Price Growth
Approach to remuneration for recruitment of a new
Executive Director
On the appointment of any new Executive Director, the
Committee would seek to offer a remuneration package
which can secure an individual with the necessary skills
and experience to lead the business and deliver the
strategy.
compensatory awards to facilitate recruitment. These
awards would be in such form as the Committee considers
appropriate, taking into account all relevant factors
including the form, expected value, anticipated vesting and
timing of the forfeited awards. The value of any
compensatory awards would be no higher, in the opinion of
the Committee, than the value forfeited.
Executive Directors would be appointed within the
remuneration framework set out in the Policy Table for
Executive Directors. Salaries would typically be set at an
appropriately market competitive level to reflect skills and
experience, although, if appropriate, the Committee may
set salaries towards the lower end of the market range to
allow future salary progression to reflect performance and
development in the role. A higher salary than the departing
director’s salary may be appropriate in certain
circumstances, particularly where the experience and
calibre of the individual warrants such a positioning. In
accordance with the Policy Table, the Committee also has
discretion to include other benefits such as housing or
relocation benefits, if relevant to reflect specific individual
circumstances. The maximum level of variable
remuneration which may be awarded (excluding any
compensatory awards referred to below) would be as set
out in the Policy Table.
Depending on the timing and responsibilities of the
appointment, it may be necessary to set different annual
bonus/LTIP performance measures and targets for initial
awards from those applicable to other Executive Directors.
Where an individual forfeits outstanding incentive awards
with a previous employer, the Committee may offer
Any share awards referred to in this section will be granted
as far as possible under the Company’s existing share
plans. Share awards may be granted under the Company’s
LTIP in excess of the limits set out in the Policy Table above
to provide compensatory buyout awards only (which may
be subject to any performance conditions the Committee
considers appropriate), in accordance with the terms
above. If necessary, awards may be granted outside of
these plans as currently permitted under the Listing Rules,
but within the limits set out in this section.
Any incentive awards granted to employees prior to their
promotion to the Board will be permitted to vest on their
original terms.
The remuneration package for a newly appointed Non-
Executive Director would normally be in line with the
structure set out in the Policy Table for Non-Executive
Directors.
Service contracts
The service agreements of the Executive Directors are
rolling contracts which were entered into on the dates
shown in the following table:
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NAME
CONTRACT DATE
NOTICE PERIOD FROM THE DIRECTOR
NOTICE PERIOD FROM THE COMPANY
Barbara Richmond
18/01/10
Matthew Pratt
01/07/20
6 months
12 months
12 months
12 months
The service agreements provide for formal notice to be served to terminate the agreement, by either the Company or the
Executive Director, with the required period of notice shown in the table. The agreements and letters of appointment do
not include any provisions for pre-determined compensation for early termination. The Committee may terminate service
agreements immediately by making a payment in lieu of notice consisting of base salary, benefits and pension for the
unexpired period of notice. At the discretion of the Committee, this payment may be made as instalments over the
period, subject to a duty to mitigate, or as a lump sum.
For appointments after 1 July 2017, it is the Committee’s policy that notice periods will normally be 6 months from both
the Director and the Company initially and thereafter, 12 months from both the Director and the Company, and that
payments in lieu of notice will comprise no more than base salary, benefits and pension only over the unexpired period
of notice. This policy applies to Matthew Pratt who was appointed to the Board on 1 April 2019.
The Non-Executive Directors’ terms of appointment are detailed in formal letters of appointment as shown in the table
below. Each appointment is for a fixed initial period of three years although this term is terminable upon either party
giving three months’ notice.
NAME
POSITION
DATE OF INITIAL APPOINTMENT
CURRENT DATE OF APPOINTMENT
Nick Hewson 1
Non-Executive
Nicky Dulieu
Non-Executive
01/12/12
06/11/19
Richard Akers
Non-Executive Chairman
01/06/21
Oliver Tant
Non-Executive
Geeta Nanda 2
Non-Executive
01/02/22
01/05/23
1. Nick Hewson stepped down from the Board at the November 2022 Annual General Meeting.
2. Geeta Nanda joined the Board as a Non-Executive Director on 1 May 2023.
N/A
06/11/22
01/06/21
01/02/22
01/05/23
Copies of the Directors’ service contracts and letters of appointment are available for inspection at the Company’s
registered office.
Policy on payments following Directors’ termination of service
On termination of a Director’s contract, the Committee’s objective is to agree an outcome which is in the best interests of
the Company and its shareholders, taking into account the specific circumstances and performance of the individual, as
well as any relevant contractual obligations and incentive plan rules.
As described in the section above, contractual payments in lieu of notice would be limited to salary and contractual
benefits and may be made in instalments subject to mitigation.
The Committee has discretion to make a payment under the annual bonus in respect of the year of leaving where an
individual is designated a “good leaver” (as described below). In such circumstances, the maximum bonus opportunity
would normally be reduced pro-rata to reflect the portion of the year served. Any payment would remain subject to
performance against the original targets and, if practicable, would be assessed and paid (in cash) as part of the normal
year end assessment process. Outstanding awards under the deferred bonus plan and the LTIP would be treated in
accordance with the relevant plan rules. Under these rules, if the participant leaves as a “good leaver”, then the
treatment of outstanding awards will be as follows:
• Deferred bonus: Nil-cost options will be exercisable for a period of six months following the date of cessation. Options
will be exercisable in full unless (for awards made in respect of 2015 and subsequent financial years other than in the
case of death) the Committee exercises discretion to reduce the awards pro-rata to reflect the extent to which the
vesting period had elapsed at the date of cessation; and
• LTIP: Awards will normally continue to the original vesting date although the Committee may determine that awards
vest following cessation. Where a holding period applies, awards will normally continue to be subject to that holding
period following cessation. Unless the Committee determines otherwise, awards will be reduced pro-rata to reflect the
extent to which the performance period has elapsed at the date of cessation and time served as an executive. The
Committee will decide the extent to which the award vests in these circumstances. If an individual dies, their LTIP
178
awards will normally vest shortly following their death and their LTIP awards will only be time pro-rated if the
Committee considers it appropriate.
Circumstances in which a participant will be considered a “good leaver” are: death, ill-health, injury, disability,
redundancy, retirement or the sale of the individual’s employing company or business outside of the Group.
Where an individual leaves the Company for any other reason, deferred bonus and unvested LTIP awards will lapse.
The Committee retains discretion to make additional exit payments where such payments are made in good faith in
discharge of an existing legal obligation (or by way of damages for breach of such an obligation) or by way of settlement
or compromise of any claim arising in connection with the termination of a director’s office or employment or for any fees
for outplacement assistance and/or the director’s legal and/or professional advice fees in connection with their cessation
of office or employment. The details and rationale for any such payments would be disclosed in the Annual
Remuneration Report.
Non-Executive Director fees
COMPONENT
OPERATION
Non-Executive
fees
Fees are determined by the Board excluding the Non-Executive Directors. The fee encompasses a
basic fee and supplementary fees for serving on a Board Committee or acting as Senior Independent
Director. It may also include supplementary fees for undertaking duties or making a time commitment
to Company business beyond the Non-Executive Director’s normal role.
Expenses incurred in respect of the performance of duties for the Company may be reimbursed or
paid for by the Company, including any tax due on such payments.
The fees payable to the Non-Executive Directors will not exceed the limit set out in the Company’s
Articles of Association and will be set at a level which reflects skills, experience, time commitment
and appropriate market data.
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ANNUAL REPORT ON
REMUNERATION
I M PLE M E NTATI O N O F P O LI CY F O R 2 02 4
This section summarises how the Committee intends to operate the Remuneration Policy for the year ending 30 June
2024.
Salary
All employees of the business including executive directors have received a salary increase of 3% with some employees
receiving higher increases, where appropriate.
The salaries are effective from 1 July 2023 and are as follows:
£’000
Barbara Richmond
Matthew Pratt
1 JULY
2023
412.6
676.0
1 JULY
2022
%
INCREASE
400.6
656.3
3.0%
3.0%
As set out in the Chair’s Annual Statement, it is the Committee’s intention to increase Barbara Richmond’s salary to
£470,000 from July 2024 subject to continued good service and performance in the role.
Pension
Matthew Pratt’s and Barbara Richmond’s pension contributions in FY2024 will be 10% of salary which is in line with the
workforce contribution rate. The workforce pension contribution rate was increased from 7% to 10% of salary on 1
January 2023.
Annual bonus
The annual bonus opportunity for executive directors will be 150% of salary for FY24 in line with the annual bonus policy
limit approved by shareholders at the last Policy review.
The Committee considered carefully the metrics and weightings for the year in the context of current market conditions
and the key financial and non-financial priorities of the business over the next 12 months. In previous years, an element
of the bonus was based on the number of outlets opened but for FY24 this has been removed as the focus has shifted
away from buying land at the current time.
Instead, the Committee has placed a higher weighting on financial performance measured by profit before tax (PBT)
which will increase from 50% to 65% and on ESG which will increase from 5% to 10%, The ESG measure is based on our
diversity goals focusing on female entrants into graduate schemes and increasing our intake of apprentices from an
ethnically diverse background.
Customer service remains of paramount importance as does the health and safety of our employees and subcontractors.
Accordingly, 12.5% of the bonus will continue to be based each on customer service targets and health and safety.
MEASURES FOR FY24
Profit Before Tax
Customer Service
Health & Safety
ESG (diversity)
65%
12.5%
12.5%
10%
These measures are felt to be appropriately aligned with our current priorities. A sliding scale of targets will apply for
each measure (except ESG) with 20% of maximum payable for achieving a demanding threshold target. Unlike last year,
the ESG metric will involve a quantitative assessment with this element of the bonus split between two independently
assessed targets relating to female diversity and ethnic diversity.
180
It is the current intention that targets will be disclosed in the FY24 Remuneration Report provided the Committee is
comfortable they are no longer commercially sensitive at the time.
LTIP awards to be granted during FY24
The Remuneration Committee will consider the prevailing share price at the time of grant and assuming there is no
significant change from the date this report is signed off, it is expected that LTIP awards in the 2024 financial year will be
made at the level of 150% of salary to Matthew Pratt and Barbara Richmond.
The key financial KPIs for Redrow are EPS growth and ROCE. Last year, the Committee introduced a climate-related metric and
this remains an important non-financial goal for the business. When we consulted shareholders on changes to the terms of the
September 2022 LTIP award, those who responded were supportive of the use of relative total shareholder return at the current
time. Reflecting this, and taking into account our medium-term priorities, the following measures and targets will apply for the
September 2023 LTIP award:
Underlying EPS (FY26)
ROCE (FY26)
Relative TSR
Carbon reduction (Scope 1 & 2 GHG emissions)1
WEIGHTING
40%
20%
30%
10%
THRESHOLD2
(20% VESTING)
62.8 pence
14.5%
MAXIMUM2
(100% VESTING)
70 pence
16.5%
Median
Upper Quartile
-32.7%
-37.3%
1.
The reduction targets (measured as Scope 1 and 2 greenhouse gas emissions) are by reference to a baseline year of 2020/21 (tCO2e 16,099) and will be measured
using the year ending June 2026.
2. For each measure, vesting will be on a straight line basis between Threshold and Maximum.
In setting the financial targets, the Remuneration Committee considered the internal plan and market consensus,
recognising the current macro-economic environment and challenging trading conditions is likely to result in lower
profitability over the next three year period.
Reflecting this and the need to set challenging targets in the current circumstances, the EPS threshold has been set at
current market consensus meaning none of this part of the award will vest unless market expectations have been met or
exceeded. The maximum is materially ahead of current external expectations and is appropriately stretching. The ROCE
targets have also taken into account internal and external forecasts and have been based on our guidance level of land
creditors. The Committee will consider, at the time of vesting, whether it is appropriate to apply any discretion in the
event that land creditors are materially different to the Company’s guidance. The Committee retains the power to amend
targets to ensure they are no more or less challenging in the event of unforeseen changes to tax rates or accounting
standards during the performance period.
The TSR measure will compare Redrow’s three-year return against the following home construction peers – Barratt,
Bellway, Berkeley, Crest Nicholson, MJ Gleeson, Persimmon, Taylor Wimpey and Vistry.
The Carbon reduction targets have been set in the context of meeting the 1.5 degree SBTi pathway and our overall goal
of reducing our absolute Scope 1 and 2 GHG emissions by 42% by FY30, from our FY21 base year. Our 2030 net zero
carbon targets have been validated by the Science-Based Targets Initiative.
In 2023, a significant reduction in GHG emissions was achieved with over half of the reduction down to the transition to
REGO backed renewable electricity. Recognising the material progress that has been achieved in such a short space of
time, the emission reduction targets for the 2023/24 LTIP are based on delivering our 2028 and 2029 SBTi pathway two
to three years earlier than scheduled, in 2026. As emissions are related to build activity and given prevailing political
and economic headwinds, the Committee will consider whether any adjustments to vesting are required to reflect a
material deviation in build assumptions implicit in our SBTi pathway.
In line with our Policy, vested awards will be subject to an additional two-year post-vesting holding period.
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Non-Executive Director and Chairman fees
2 02 3 A N N UA L B O N U S
The Board excluding the Non-Executive Directors conducted an annual review of Non-Executive Director fees and
awarded a 3% increase from 1 July 2023 meaning the base fee for a Non-Executive Director will increase from £59,195
p.a. to £60,975 p.a.
The additional fees for Committee Chairs and the Senior Independent Director were also increased from £12,000 p.a. to
£12,360 p.a. from 1 July 2023. The base fee and additional fees reflect the level of time commitment required in
undertaking the role.
The Remuneration Committee reviewed the Chairman’s fee and agreed a 3% increase from £262,500 to £270,375 p.a.,
effective from 1 July 2023.
S I N G L E TOTA L F I G U R E O F R E M U N E R AT I O N TA B LE ( AU D I T E D)
The tables below set out the remuneration for the Directors in respect of 2023. Further discussion of each of the
components is set out on the pages which follow. Where indicated, these disclosures have been audited.
The remuneration of the Executive Directors in respect of 2023 is shown in the table below (with the prior year
comparative).
The maximum bonus opportunity for the Executive Directors in 2023 was 150% of salary. This was based on the
achievement of stretching targets under a balanced scorecard of performance measures. The following measures and
targets applied:
% OF BONUS
OPPORTUNITY
THRESHOLD PAYOUT MAXIMUM PAYOUT
ACTUAL 2023
PERFORMANCE
PAYOUT ACHIEVED
(% OF TOTAL BONUS
OPPORTUNITY)
PBT (i)
50.0%
£423m
£478m
20.0%
Number of outlets opened
Customer recommend score (ii) 12.5%
Accident rate (homes built/
accident)
12.5%
26
80%
25.0
31
84%
27.5
£395m
31
79.6%
27.1
ESG
Total
5.0%
100%
Partial
achievement
Objectives
achieved
Fully achieved
(see assessment
below)
0.0%
20.0%
0.0%
10.9%
5.0%
35.9%
SALARY
BENEFITS (I)
PENSIONS (II)
BONUS (III)
LTIP (IV) (V)
TOTAL
REMUNERATION
TOTAL FIXED
REMUNERATION
TOTAL VARIABLE
REMUNERATION
(i) PBT is underlying, pre-exceptional items.
£’000
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
(ii) This measure was changed from the 8 week HBF customer satisfaction survey to the 9 month version to better represent true customer service achieved.
Matthew Pratt
656
625
Barbara Richmond
401
381
33
39
29
36
56
60
44
76
353
781
986
122 2,084
1,601
216
477
676
110 1,392
1,080
745
500
698 1,339
493
892
903
587
(i) Benefits include a fully expensed company car (or equivalent cash allowance) and private health insurance.
(ii)
(iii)
(iv)
Pension includes the value of the cash allowance paid to Matthew Pratt and Barbara Richmond in respect of the relevant year. Barbara Richmond’s pension
contribution was 20% of salary until 31 December 2022 and then reduced to the prevailing workforce contribution rate of 10% of salary. Matthew Pratt’s pension
contribution for the year was in line with the workforce rate which was 7% of salary until 1 January 2023 and 10% of salary thereafter.
Annual bonus represents the full value of the bonus awarded in respect of the relevant financial year including both cash and deferred elements. Details of outcomes
against the performance targets are set out below. See page 166 and 167 on how the Remuneration Committee determined the level of the annual bonus payment.
The 2023 column includes the value of the September 2020 LTIP which will vest in full on 23 September 2023. The value of this award has been based on the
average share price over the last three months of FY23 of 493 pence. 21.7% of this award is attributable to share price appreciation over the period based on the
estimated vesting share price. No discretion was applied by the Remuneration Committee to amend the vesting outcome.
(v)
The 2022 column includes the value of the 24.2% of the 2019 LTIP which vested on 11 September 2022. In last year’s report this was calculated using the average
share price over the last three months of FY22 of 519 pence. The figure has been updated to reflect the actual share price on 11 September 2022 of 488 pence.
The remuneration of the Non-Executive Directors in respect of 2023 are shown in the table below (with the prior year
comparative).
£’000
Richard Akers (i)
Nicky Dulieu (ii)
Oliver Tant (iii)
Geeta Nanda (iv)
Nick Hewson (v)
John Tutte (vi)
Sir Michael Lyons (vii)
FEES
2023
263
78
67
10
29
–
–
2022
210
66
23
–
76
63
24
(i)
Richard Akers joined the Board as a Non-Executive Director on 1 June 2021 and became Non-Executive Chairman on 15 September 2021.
(ii) Nicky Dulieu was appointed Senior Independent Director on 11 September 2022.
(iii) Oliver Tant joined the Board as a Non-Executive Director on 1 February 2022.
(iv) Geeta Nanda joined the Board as a Non-Executive Director on 1 May 2023.
(v) Nick Hewson stepped down from the Board as a Non-Executive Director on 11 November 2022.
(vi
John Tutte served as Non-Executive Chairman from 6 November 2020 to 15 September 2021. The disclosure in the above table and footnote are in reference to that
period.
(vii) Sir Michael Lyons stepped down from the Board as a Non-Executive Director on 12 November 2021.
182
The PBT threshold was not met. See Chairman's statement on pages 2 and 3. The Customer recommend score was
marginally below threshold and therefore no bonus under this measure was accrued.
The Accident rate outcome was between threshold and maximum resulting in a partial payout. The ESG component was
based on supporting the improvement in gender and ethnic diversity of Redrow’s new entrant population and, as set out
in last year’s report, this involved a qualitative assessment. The following factors were considered:
• Targets on gender and ethnic diversity are now reported on and discussed at Executive Management Team meetings
ensuring its importance is emphasised.
• ED&I and the specific targets are an agenda point at every divisional engagement meeting and have featured at the
last two national workforce engagement meetings. A working group has been set up to look at how the business can
improve in relation to site-based employees.
• During the year the business has invested in third party recruitment support to improve the rigour of the process and
conducted a thorough review of all recruitment promotional materials and processes to ensure the use of inclusive
language and images to widen reach. The use of virtual assessment centres has proved particularly effective in
widening participation.
The Committee recognises that the financial performance delivered by the business was below expectations set at the
beginning of the year and this is reflected in a below target bonus outcome. However, the Committee believes strong
progress has been made in certain areas including health and safety and diversity, that management responded
appropriately to the change in the macro-economic environment and that a 35.9% of maximum bonus outcome is
appropriate in the circumstances.
In line with the Policy, 50% of the bonus will be paid in cash and the other 50% will be deferred in shares which will vest
after 12 and 24 months.
LO N G T E R M I N C E N T I V E P L A N ( LT I P)
The LTIP is designed to motivate and reward long-term performance and delivery of the strategy and provide alignment
with Redrow shareholders.
The sections below summarise details of the September 2020 LTIP awards which are capable of vesting in September
2023 and those awards which were granted during the 2023 financial year.
LTIP awards vesting in respect of 2023
The LTIP awards granted in September 2020 were based on performance over the three year performance period
ending 2 July 2023. Based on performance against the EPS and ROCE targets set when the award was granted,
summarised in the table following, the EPS and ROCE measures were met in full.
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AWARD VESTING LEVEL AS A % OF SHARE OPTIONS GRANTED (FOR EACH COMPONENT)
Nil
6.67%
20%
50%
Vesting between the points above is on a sliding scale basis
Actual performance
Vesting (% of total award)
EPS FOR 2023
(SEE NOTE 1)
ROCE FOR 2023
(SEE NOTE 2)
Below 73.0p
Below 17%
73.0p
77.0p
18%
20%
86.0p or above
20% or above
91.2p
50%
23.11%
50%
1.
The original EPS targets as set out in the above table were amended to 71.38p (threshold), 75.28p (target) and 84.09p (maximum) to (i) take account of the increases
in corporation tax and the introduction of RPDT, and (ii) to adjust for the impact of the £100m share buy-back programme. Neither of these were known at the time
the targets were set and these adjustments ensured the participant was in no better or worse position. This is consistent with the methodology applied to previous
awards and consistent with Redrow’s approach for LTIP awards.
2.
The original ROCE targets as set out in the above table were amended upwards to 18.1% (threshold), 19.2% (target) and 21.3% (maximum) to remove the benefit of the
impact of the FY22 exceptional item from net assets / capital employed.
The EPS and ROCE targets were set in December 2020 during the pandemic and were stretching in the context of the
outlook at the time. Post pandemic, the Group’s recovery was encouraging with the Group recording EPS of 95.6p in
FY22. FY23 has been more challenging for reasons set out earlier in this report and overall, EPS and ROCE performance
has been just above the maximum targets set, resulting in 100% of the awards vesting.
The Remuneration Committee has discretion to adjust the number of shares vesting from the award if it considers that
the vesting outcome is not sufficiently reflective of the underlying performance of the Company and to the extent the
Remuneration Committee believes there have been windfall gains. The Committee considers the overall three-year
performance of the business in the context of the recovery from the pandemic to have been strong and reflective of the
actions of the management team. Therefore, the Committee has agreed that the vesting outcome is warranted,
particularly in the context of nil LTIP vesting in 2020 and 2021, partial 24% vesting in 2022 and anticipated nil vesting in
2024. The awards were granted at a price of 405 pence and the estimated vesting price is c.20% higher. The Committee
does not believe this constitutes a windfall gains that requires an adjustment to the vesting level.
The value of the vested award is estimated and included in the 2023 LTIP column of the Single Total Figure of
Remuneration table on page 182.
S C H E M E I N T E R E S T S AWA R D E D D U R I N G 2 022 / 2 3 ( AU D I T E D)
Long Term Incentive Plan
The following table sets out details of the original LTIP awards granted to Executive Directors on 21 September 2022.
EXECUTIVE DIRECTOR
Matthew Pratt
Barbara Richmond
NUMBER OF
AWARDS
GRANTED
BASIS OF AWARD
198,193
150% of salary
120,962
150% of salary
FACE
VALUE 1
£984k
£601k
THRESHOLD
VESTING (% OF
MAXIMUM)
VESTING DATE
13.3%
21 September 2025
13.3%
21 September 2025
(i)
The share price used to determine the number of shares awarded was £4.967 (the average share price over the three days prior to the date of grant).
184
As set out in the Annual Statement, on 1 September 2022 the Remuneration Committee set the performance conditions
applying to the 2022/23 LTIP grant (EPS, ROCE and Carbon reduction targets) and approved stretching targets for each
of the conditions that reflected the prevailing internal and external outlook. The measures and targets were based on
performance in FY25:
• EPS range of 82p to 100p
• ROCE range of 22% to 25%
• Carbon reduction of 15.7% to 20.7% (Scope 1 and 2, using a baseline of 2020/21 (tCO2e 16,099))
Within two days of granting the LTIP targets the Mini-Budget took place and created an immediate and significant
economic shock to the market and the subsequent impact on housebuilders was unexpected and a direct result of the
Government’s Mini-Budget.
The purpose of the LTIP is to drive long term performance commensurate with the business’s risk appetite. It quickly
became clear that the 2022 LTIP awards were no longer achieving their purpose – to motivate sustained performance
and retain key staff.
Given the 2022 grant was made just two days prior to the Mini-Budget, and in order to ensure it motivated the
management team and remained an appropriate incentive over the 3-year performance period, the Committee revisited
the terms of the 2022 award around six months following the grant of the awards.
The EPS and ROCE measures were replaced with a relative Total Shareholder Return (TSR) condition
Threshold (13.3% vesting)
Target (40% vesting)
Maximum (100% vesting)
RELATIVE
TSR 1
(90%)
ESG – CARBON
REDUCTION 2
(10%)
Median rank
n/a
15.7%
18.7%
Upper Quartile rank or higher
20.7% or higher
1.
2.
TSR is measured against Barratt, Bellway, Berkeley, Crest Nicholson, MJ Gleeson, Persimmon, Taylor Wimpey and Vistry.
The Carbon reduction targets have been set in the context of meeting the 1.5 degree SBTi pathway. The reduction targets (measured as Scope 1 and 2 greenhouse
gas emissions) are by reference to a baseline year of 2020/21 (tCO2e 16,099) and will be measured using the year ending June 2025.
Furthermore, the Committee introduced two underpins that will apply to the revised 2022 award to ensure stakeholder
interests are protected:
• Notwithstanding performance against the relative TSR measure, the Remuneration Committee will apply appropriate
negative discretion if absolute TSR between the date of change of the performance conditions and vesting is negative.
• The Committee may reduce vesting to reflect the wider stakeholder experience and in doing so will consider the
experience of our employees, customers, and suppliers.
To reflect the above change in performance condition which took place six months into the 36 month performance
period, participants surrendered 1/6th of the awards they were granted. The following table sets out details of the
original LTIP awards granted to Executive Directors on 21 September 2022 and the revised number of awards.
ORIGINAL GRANT – 21 SEPTEMBER 2022
TERMS OF THE REVISED GRANT TO REFLECT THE
CHANGE IN PERFORMANCE CONDITIONS
EXECUTIVE DIRECTOR
NUMBER OF
AWARDS
GRANTED
BASIS OF
AWARD
FACE
VALUE 1
NUMBER OF
AWARDS AFTER
1/6TH
REDUCTION
BASIS OF AWARD
AFTER 1/6TH
REDUCTION
FACE VALUE
THRESHOLD
VESTING
(% OF
MAXIMUM)
Matthew Pratt
198,193
Barbara Richmond
120,962
150% of
salary
150% of
salary
£984k
165,096
£601k
100,761
125% of
salary
125% of
salary
£820k
13.3%
£500k
13.3%
VESTING DATE
21 September
2025
21 September
2025
(i) The share price used to determine the number of shares awarded was £4.967 (the average share price over the three days prior to the date of grant).
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Directors' remuneration report / continued
The Committee understands the risks with amending performance targets but believes this is warranted given the
Committee acted early to amend the targets to reflect a change in the external environment, there is a reduction in the
number of awards grant and the revised award requires outperformance of the sector for any vesting. The Committee
communicated this change to leading investors and were grateful for the written support received from those who
responded. The same adjustments to targets and reductions to grants were made to all 2022 LTIP recipients.
LTIP awards made to Matthew Pratt and Barbara Richmond were in the form of nil-cost options and vested awards will be
subject to a further two-year holding period.
Deferred Bonus Plan
Between 2 July 2023 and 15 September 2023 (being the latest practicable date prior to the posting of this report), there
were no further changes to the directors’ beneficially held shares. On 21 September 2023, 100% of the 2020 LTIP award
will vest and these options are shown in the above table under the column "Number of unvested LTIP awards".
The table below provides details of executive directors’ share interests:
AWARDS
HELD AT
3 JULY
2022
SHARE
PRICE
ON
GRANT
£
GRANT
DATE
AWARD
VESTED
AWARDS
GRANTED
IN YEAR
AWARDS
LAPSED
IN YEAR
AWARDS
EXERCISED
IN YEAR
AWARDS
HELD AT
2 JULY
2023
EXERCISE
PRICE
£
EXERCISABLE
FROM
EXERCISABLE
TO
Deferred Bonus Plan awards, being 50% of the bonus earned relating to FY22 performance, were granted during the
year as set out below:
Matthew Pratt
SAYE 2020
4,768 09/11/20
4.72
–
DIRECTOR
NUMBER OF
AWARDS GRANTED
FACE VALUE (I)
PORTION OF
BONUS DEFERRED
VESTING DATE
Matthew Pratt
78,644
Barbara Richmond
48,001
£391k
£238k
50%
50%
50% on 21 September 2023 and
50% on 21 September 2024
50% on 21 September 2023 and
50% on 21 September 2024
(i) The face value has been calculated using the average share price used to determine the number of shares awarded, being £4.967 (the average over the three days
prior to the date of grant).
S H A R E H O L D I N G G U I D E LI N E S A N D S H A R E I N T E R E S T S
Under our shareholding guidelines, Executive Directors are expected to build and retain a shareholding in the Group at
least equivalent to 200% of base salary. Until the shareholding guideline has been met Executives will be required to
retain all deferred bonus shares and LTIP shares on a net of tax basis.
S TAT E M E N T O F S H A R E H O LD I N G A N D S C H E M E I N T E R E S T S ( AU D I T E D)
The following table sets out the shareholding (including connected persons) of the Directors in the Company as at 2 July
2023 and current interests in long-term incentives.
LTIP 2019
LTIP 2020
LTIP 2021
LTIP 2022
103,448
11/09/19 5.945 25,034
199,852 23/09/20 4.053
131,192 21/09/21
7.146
–
–
–
–
–
–
–
(78,414)
–
–
–
–
–
–
–
25,034
199,852
131,192
165,086
– 21/09/22 4.967
– 198,183
(33,097)
DEF BONUS 2021
37,783 21/09/21
7.146
18,891
–
DEF BONUS 2022
– 21/09/22 4.967
–
78,644
–
–
(18,891)
18,892
–
78,644
477,043
43,925 276,827
(111,511)
(18,891) 623,468
Barbara Richmond
4,768
3.775
01/01/24
01/07/24
–
–
–
–
–
–
11/09/22
11/09/29
23/09/23
23/09/30
21/09/24
21/09/31
21/09/25
21/09/32
21/09/22
21/09/31
21/09/23
21/09/32
SAYE 2019
SAYE 2020
SAYE 2022
LTIP 2019
LTIP 2020
LTIP 2021
LTIP 2022
1,821 28/10/19
2,384 09/11/20
6.81
4.72
2,868 09/11/22
3.137
1,821
–
–
93,356
11/09/19 5.945 22,592
136,936 23/09/20 4.053
80,080 21/09/21
7.146
–
–
–
–
–
–
–
–
–
–
–
(70,764)
–
–
– 21/09/22 4.967
– 120,962
(20,201)
(1,821)
–
–
–
–
–
–
–
2,384
2,868
22,592
136,936
80,080
100,761
DEF BONUS 2021
25,889 21/09/21
7.146
12,944
–
DEF BONUS 2022
– 21/09/22 4.967
–
48,001
–
–
(12,944)
12,945
–
48,001
4.94
3.78
01/01/23
01/07/23
01/01/24
01/07/24
3.137
01/01/26
01/07/26
–
–
–
–
–
–
11/09/22
11/09/29
23/09/23
23/09/30
21/09/24
21/09/31
21/09/25
21/09/32
21/09/22
21/09/31
21/09/23
21/09/32
343,334
37,357 168,963 (90,965)
(14,765) 406,567
NUMBER OF
SHARES
BENEFICIALLY
HELD AT 2
JULY 2023
NUMBER OF
VESTED AND
UNVESTED
DEFERRED
BONUS
AWARDS
NUMBER OF
VESTED BUT
UNEXERCISED
LTIP AWARDS
NUMBER OF
UNVESTED
LTIP
AWARDS
NUMBER OF
HMRC APPROVED
UNVESTED ALL
EMPLOYEE
AWARDS (SAYE)
SHAREHOLDING
AS % OF SALARY
GUIDELINE
MET?
i.
ii.
The performance conditions attached to the 2020 LTIP awards have been met in full and therefore these awards will vest on 21 September 2023.
The performance conditions attached to the 2021 LTIP awards were disclosed in the 2022 Directors’ Remuneration Report.
Executive Directors
Matthew Pratt
107,515
97,536
25,034
496,130
Barbara Richmond
572,765
60,946
22,592
317,777
4,768
5,252
126%
738%
Non-Executive Directors
Richard Akers
Nick Hewson 1
Nicky Dulieu
Oliver Tant
Geeta Nanda
60,000
33,500
6,500
11,303
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
No
Yes
–
–
–
–
–
(i) The shareholding of Nick Hewson is as at the date he stepped down from the Board on 11 November 2022.
Shareholding as a percentage of salary is based on the number of beneficially held shares and the number of
outstanding deferred bonus awards (net of tax) and vested but unexercised LTIP awards (net of tax) held at 2 July 2023.
The value of shareholding is calculated using the base salary as at 1 July 2023 and the average share price for the final
quarter of the year ended 2 July 2023. Matthew Pratt is building his shareholding in line with the Remuneration Policy
and is expected to retain all vested deferred bonus and LTIP awards until the shareholding guidance is met.
iii. The performance conditions attached to the 2022 LTIP awards are shown on page 185.
iv. There are no further performance conditions attached to the exercise of the deferred bonus awards.
G A I N S M A D E BY D I R E C TO R S O N S H A R E O P T I O N S
The table below outlines the notional gains made by Directors on share options exercised during the year, calculated as
at the exercise date.
EXECUTIVE DIRECTOR
Matthew Pratt
Barbara Richmond
Barbara Richmond
P E N S I O N
NUMBER OF
SHARES
EXERCISED
DATE OF
EXERCISE
SCHEME
DEF BONUS 2021
18,891
21/09/22
SAYE 2019
1,821
14/02/23
DEF BONUS 2021
12,944
21/09/22
MID PRICE
ON DATE OF
EXERCISE
(PENCE)
488.4
511.0
488.4
NOTIONAL GAIN ON
EXERCISE (£'000)
92.2
–
63.2
Matthew Pratt is a deferred member of the Redrow Staff Pension Scheme (now closed for future accruals) and details of
entitlements under this plan are set out below. Barbara Richmond received a pension allowance supplement equivalent
to 20% of salary to 31 December 2022 and 10% of salary thereafter. Matthew Pratt received a pension allowance
supplement equivalent to 7% of salary to 31 December 2022 and 10% of salary thereafter. The value of these cash
supplements is included in the pension column of the Single Total Figure of Remuneration Table. Barbara Richmond and
Matthew Pratt are also covered by fixed term group income protection and death in service benefit.
186
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TOTA L P E N S I O N E N T I T LE M E N T S
Details of the Executive Directors’ pension entitlements under the defined benefit section of the Redrow Staff Pension
Scheme are as follows:
DIRECTOR
Matthew Pratt
NORMAL RETIREMENT
DATE
ACCRUED BENEFIT
AT 2 JULY 2023
£
BENEFITS PAID TO
DIRECTOR DURING
PERIOD UP TO
2 JULY 2023
£
DEFINED BENEFIT
ACCRUED DURING
PERIOD UP TO
2 JULY 2023
£
6 July 2040
17,526
Nil
Nil
The normal retirement date shows the date at which the Director can retire without actuarial reduction. No additional
benefit is available on early retirement.
The accrued pension shown above is the amount of pension entitlement that would be paid each year on retirement on
the normal retirement date, based on service to 29 February 2012. The Scheme closed the accrual of future benefits with
effect from 1 March 2012.
S U P P O R T I N G D I S C LO S U R E S , A D D I T I O N A L S TAT U TO RY I N F O R M AT I O N A N D A D D I T I O N A L C O N T E X T
Percentage change in remuneration of Group Chief Executive, Directors and all employees
The table below shows the percentage change in the salary, benefits and annual bonus paid to each Director compared
to the average pay of all Redrow employees who qualify for participation in the Company’s bonus and benefits plans for
the years ending June 2020, 2021, 2022 and 2023.
NAME
MATTHEW
PRATT
(GROUP
CHIEF
EXECUTIVE)
BARBARA
RICHMOND
(CHIEF
FINANCIAL
OFFICER)
RICHARD
AKERS (II)
(NON-
EXECUTIVE
DIRECTOR)
NICKY
DULIEU (III)
(NON-
EXECUTIVE
DIRECTOR)
OLIVER
TANT (IV)
(NON-
EXECUTIVE
DIRECTOR)
GEETA
NANDA (V)
(NON-
EXECUTIVE
DIRECTOR)
NICK
HEWSON (VI)
(SENIOR
INDEPENDENT
DIRECTOR)
AVERAGE PAY
OF REDROW
EMPLOYEES
N/A
N/A
N/A
N/A
N/A
N/A
2023
Salary/fee
5.0%
5.1%
25.0%
18.4%
Benefits
13.8%
8.3%
N/A
N/A
Annual bonus
(54.8%)
(54.7%) N/A
2022
Salary/fee
Benefits
15.7%
26.1%
3.0%
2.9%
Annual bonus
44.6%
28.9%
2021
Salary/fee
Benefits
35.3%
2.78%
4.5%
0.0%
Annual bonus
N/A (i)
N/A (i)
N/A
N/A
N/A
N/A
N/A
N/A
2020
Salary/fee
Benefits
Annual bonus
6.50%
N/A
84.2%
(100%)
N/A
N/A
N/A
6.5%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
1.3%
N/A
N/A
2.74%
N/A
N/A
1.4%
N/A
N/A
5.0%
(10.8%)
(42.2%)
3.1%
(7.4%)
(11.1%)
3.07%
1.4%
292.9%
2.92%
11.0%
(64.3%)
(i)
Zero bonus was awarded to Matthew Pratt and Barbara Richmond for FY20. £540k and £370k bonus respectively was awarded for FY21.
(ii) Richard Akers was appointed as Non-Executive Director on 1 June 2021 and Non-Executive Chairman on 1 September 2021.
(iii) Nicky Dulieu was appointed as Non-Executive Director on 6 November 2019 and subsequently appointed Senior Independent Director on 11 September 2022.
(iv) Oliver Tant was appointed as Non-Executive Director on 1 February 2022.
(v) Geeta Nanda was appointed as Non-Executive Director on 1 May 2023.
(vi) Nick Hewson stepped down from the Board as Non-Executive Director on 11 November 2022.
188
CEO PAY RATIO
The table below sets out the CEO pay ratio for the last four financial years. It compares the single total figure of
remuneration for the Group Chief Executive with that of Group employees who are paid at the 25th, 50th and 75th
percentiles.
CEO PAY RATIO
25th Percentile pay ratio
50th Percentile pay ratio
75th Percentile pay ratio
2023
65:1
41:1
27:1
2022
55:1
35:1
23:1
2021
42:1
26:1
17:1
2020
27:1
18:1
12:1
Our CEO pay ratios have been calculated using Option A under the Companies (Miscellaneous Reports) Regulations
2018 as this is the most statistically accurate way. The total remuneration of all UK employees for the 2023 financial year
has been calculated and ranked to identify the employees where remuneration places them at the 25th, 50th and 75th
percentile points.
The salary and total pay plus benefits of the employees paid at the 25th percentile, 50th percentile and 75th percentile
are shown in the two tables below.
Salary 2023
25TH PERCENTILE
50TH PERCENTILE
75TH PERCENTILE
£30,384
£40,617
*£30,435
*
The employee identified at the 75th percentile is in a sales consultant role which has the opportunity to earn higher remuneration through commission
arrangements, hence the base salary is lower than the 50th percentile employee but the total pay and benefits is higher.
Total pay and benefits 2023
25TH PERCENTILE
50TH PERCENTILE
75TH PERCENTILE
£32,098
£50,309
£78,002
The pay ratio figures for 2023 have widened compared to those in the previous year and have returned to similar levels
to 2019. This reflects two factors. Firstly, the CEO is now on the full salary rate for the role following a period of transition
and, secondly, the full vesting of the LTIP compared to a 24.2% vesting outcome in the previous year. The total pay and
benefits payable across the workforce has increased as shown in the table above but is not as variable as the CEO’s pay.
Therefore the year on year change in the pay ratio is in line with our expectations. The Committee will continue to
monitor longer-term trends in pay.
The Remuneration Committee notes that the Group Chief Executive’s remuneration package is appropriately more
heavily weighted toward variable pay elements, i.e. annual bonus and LTIP, than the general employee population and is
therefore likely to result in the ratio fluctuating as a function of the outcomes of incentive plans year on year. However,
the Committee will continue to monitor pay ratios, including any longer term trends, as part of its annual agenda.
Relative importance of spend on pay
The table below shows total employee remuneration and distributions to shareholders, in respect of 2023 and 2022 (and
the difference between the two).
£M
Total employee remuneration
Distributions to shareholders
2023
155
199
2022
Change (%)
151
113
2.6%
76.1%
Total employee remuneration represents amounts included in note 7a to the accounts in respect of wages, social
security, pension and incentive costs for all Group employees. Distributions to shareholders include the cash returns in
respect of each financial year (see note 5 to the financial statements). This represents 30.0 pence dividend per share in
respect of 2023 and £100m share buyback programme compared to 32.0 pence per share dividend in respect of 2022.
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Directors' remuneration report / continued
Performance graph and CEO single figure table
TA B L E O F AT T E N DA N C E
The chart below shows the TSR of Redrow in the ten-year period ended 2 July 2023 against both the FTSE 250 return
index and the FTSE 350 Household Goods & Home Construction index over the same period. TSR refers to share price
growth with re-invested dividends. The Committee believes the FTSE 250 and FTSE 350 Household Goods & Home
Construction indices are the most appropriate indices against which the TSR of Redrow should be measured, as Redrow
is a constituent of both.
400
300
200
100
0
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
Redrow
FTSE 250
FTSE 350 Household Goods & Home Construction
The table below provides remuneration data for the Executive Chairman/Group Chief Executive (as applicable) for each
of the ten financial years over the equivalent period.
Name
Remuneration/
donations*
Bonus
(% of Maximum)
LTIP vesting
(% of Maximum)
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
Steve
Morgan
John
Tutte
John
Tutte
John
Tutte
John
Tutte
John
Tutte
John
Tutte
Matthew
Pratt
Matthew
Pratt
Matthew
Pratt
£1,922k £2,355k £1,916k
£2,463k £1,950k £2,093k £712k
£1,141k
£1,601k
£2,084k
100%
100%
100%
100%
96.7%
85%
Nil%
100%
100%
35.9%
100%
100%
100%
100%
100%
100%
Nil%
Nil%
24.2%
100%
*
For Steve Morgan, this value includes the nominal salary and benefits disclosed in the Single Total Figure of Remuneration table as well as Company donations
to The Steve Morgan Foundation, a UK registered charity of which Steve Morgan is a trustee, reflecting notional salary and waived annual cash bonus in respect
of the relevant year. It also includes the value of deferred bonus and vested LTIP cash awards in respect of each relevant year (calculated in accordance with the
methodology applicable to the Single Total Figure of Remuneration Table).
External Non-Executive directorships held by Executive Directors
It is the Committee’s policy that, with the approval of the Board, Executive Directors may hold one non-executive
directorship at another company in order to broaden their knowledge and experience to the benefit of the Company. The
Executive Director may retain any fee received for these duties. Barbara Richmond is a non-executive director of Lonza
Group Ltd and in line with the Committee’s policy, she is entitled to retain the fees from this appointment. She received
fees of £248k during 2023 (£209k during 2022). This represented 280,000 Swiss Francs in 2023 and 250,000 Swiss
Francs in 2022.
C O N S I D E R AT I O N O F D I R E C TO R S ’ R E M U N E R AT I O N – R E M U N E R AT I O N C O M M I T T E E A N D A DV I S O R S
The Remuneration Committee is comprised solely of Non-Executive Directors. Nicky Dulieu chaired the Remuneration
Committee and the other members during the year comprised Nick Hewson (who stepped down from the Board and the
Committee on 11 November 2022), Richard Akers, Oliver Tant and Geeta Nanda (who joined the Board and the
Committee on 1 May 2023).
190
NAME
Nicky Dulieu †
Richard Akers †
Oliver Tant †
Geeta Nanda1 †
Nick Hewson2 †
ROLE
Chair
Member
Member
Member
Member
ATTENDANCE AT MEETINGS
4/4
4/4
4/4
1/1
2/2
1
2
Geeta Nanda was appointed as Non-Executive Director on 1 May 2023 and joined as a Member of the Remuneration Committee at the same time. She attended the
meeting held between her appointment date to the end of the 2023 financial year.
Nick Hewson stepped down from the Board and as a Member of the Remuneration Committee on 11 November 2022. He attended all meetings held from the
beginning of the 2022 financial year to the date he left the Board.
† Member considered to be independent. Throughout the 2023 financial year, the Committee was made up of 100% independent members.
The Committee has agreed Terms of Reference detailing its authority and responsibilities. The Terms of Reference of the
Committee are kept under regular review and are published on the Group’s website and include:
• determining the Remuneration Policy in respect of the Executive Directors and the Company Secretary (together ‘the
Senior Executives’), taking into account the context of the Company’s overall approach to remuneration for all
employees and within this Policy determining the total individual package of each Senior Executive;
• determining performance targets and the extent of their achievement for both annual and long-term incentive awards
operated by the Company affecting Senior Executives; and
• monitoring and approving the level and structure of remuneration of the Executive Committee immediately below the
Senior Executives.
The Committee meets as often as is required but at least twice per year. The Committee met four times during the
course of the financial year ended 2 July 2023 and details of Committee attendance are set out in the table above:
The Committee received advice from FIT Remuneration Consultants LLP during the year. FIT was appointed to advise the
Committee following a competitive tender exercise. FIT is a founder member of the Remuneration Consultants Group and
as such voluntarily operates under the Code of Conduct in relation to executive remuneration consulting in the UK. The
Committee is comfortable that FIT does not have connections with Redrow plc that may impair their objectivity and
independence. The fees charged by FIT for the provision of independent advice to the Committee during 2023 was
£62,852 + VAT. FIT provided no other services to the Company.
Statement of voting at Annual General Meeting
The Directors’ Remuneration Policy was approved by shareholders at the Annual General Meeting on 12 November 2021
and there was an advisory shareholder vote to approve the Directors’ Remuneration Report at the Annual General
Meeting held on 11 November 2022. The votes cast by proxy and the meetings in respect of directors’ remuneration are
shown in the table.
RESOLUTION
NO.
%
NO.
VOTES CAST
EXC WITHHELD
%
VOTES
WITHHELD
VOTES FOR
VOTES AGAINST
TOTAL
258,197,497
96.94
8,151,899
3.06 266,349,396
430,888
247,511,457
98.66
3,367,538
1.34 250,878,995
57,766
Approval of the Directors’ Remuneration
Policy (2021)
Approval of Directors’ Remuneration
Report for the 53 weeks ended 3 July
2022
By order of the Board
Nicky Dulieu
Chair of the Remuneration Committee
15 September 2023
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Directors' report
DIRECTORS' REPORT
The Directors take pleasure in presenting to the
shareholders their report and audited consolidated
financial statements for the year ended 2 July 2023.
The Company has in place a dividend re-investment plan
which gives shareholders the opportunity to re-invest their
dividends by acquiring shares in the Company.
The Companies Act 2006 (the “Act”) requires the Directors
to present a fair review of the business during the year
ended 2 July 2023 and of the position of the Company at
the end of the financial year together with the financial
statements, Auditor’s Report and a description of the
principal risks and uncertainties which the Company faces.
The Company is required to disclose certain information in
the Directors’ Report by the FCA’s Listing Rules and
Disclosure Guidance and Transparency Rules (the “DTRs”)
and by legislation applicable to the Company. The
Corporate Governance Report and the Strategic Report,
together with sections of the Annual Report incorporated
by reference, form part of the Directors’ Report which is
presented in accordance with applicable English company
law.
The table below sets out where this key information can be
found in the Annual Report.
SUBJECT
INCORPORATED BY REFERENCE
PAGE
REFERENCE
Details of long-term incentive schemes
181 & 225
Likely future developments of the business
1 to 131
Risk management and internal controls
88 to 99
Workforce engagement
Business relationships
140
118 to 129
Management of climate related risks
102 to 113
Corporate governance arrangements
132 to 199
Section 172(1) Statement
Stakeholder engagement
TCFD Report
D I V I D E N D S
114
118 to 129
102 to 113
C A P I TA L S T R U C T U R E A N D AC Q U I S T I O N O F O W N
S H A R E S
As at 15 September 2023, being the latest practicable date
prior to publication of this report, the Company had an
issued share capital of 330,770,245 ordinary shares of 10.5
pence each (there are no shares held in treasury).
The Company has one class of ordinary shares which carry
ordinary rights to dividends (subject to the Company’s
Articles of Association). Each share carries the right to one
vote at general meetings of the Company in respect of
resolutions which are taken on a poll.
No person has any special rights of control over the
Company’s share capital and all issued shares are fully
paid.
Authority was given to the Directors at last year’s Annual
General Meeting to allot unissued shares up to an
aggregate nominal amount of £12,326,664.70 (which is
equivalent to approximately 33% of the Company’s issued
share capital) and up to a further aggregate nominal
amount of £12,326,664.70 in connection with an offer by
way of a rights issue. The authority was not exercised
during the period ended 2 July 2023 or prior to the date of
this report.
Authority was also given to the Company at last year’s
Annual General Meeting to make market purchases of the
Company’s ordinary shares up to an aggregate nominal
value of £3,697,999.41, which is equivalent to
approximately 10% of the issued share capital of the
Company. Under the authority, there is a minimum and
maximum price to be paid for such shares and the shares
purchased by the Company pursuant to this authority may
be held in treasury or may be cancelled.
The above authorities expire at the forthcoming Annual
General Meeting. Therefore, the Directors will be seeking
new authorities as set out in the Notice of Annual General
Meeting.
An interim dividend of 10.0p (2022: 10.0p) net per share
was paid on 6 April 2023.
The Board proposes to pay on 16 November 2023, subject
to shareholder approval at the 2023 Annual General
Meeting, a final dividend of 20p (2022: 22p) net per share
in respect of the year ended 2 July 2023 to shareholders
on the Register as at the close of business on 22
September 2023.
In line with the authority limits, the Company announced on
14 July 2022 that it had commenced a share buyback
programme to purchase ordinary shares of 10.5p each in
the Company for up to a maximum consideration of £100m.
The primary purpose of the buyback programme was to
reduce the capital of the Company. The share buyback
programme completed on 9 January 2023 and resulted in
the Company repurchasing 21,420,175 ordinary shares of
10.5p each in the Company, of which 12,852,106 were
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cancelled and 8,568,069 transferred to treasury. The
average price paid per share was £4.70. On 16 May 2023,
all 8,568,069 shares held in treasury were cancelled,
leaving no shares held in treasury.
The Company has made no non-pre-emptive issuances of
equity for cash over the past three reporting periods.
D I R E C TO R S
The Directors of the Company during the year ended 2 July
2023, along with their meeting attendance, are listed on
page 137. The current Directors are listed on pages 134 and
135 together with their biographical details.
the Company’s co-operation, financial rights carried by
securities are held by a person other than the holder of the
securities.
E M P LOY E E B E N E F I T T R U S T
Zedra Trust Company (Guernsey) Limited (“Zedra”), as
trustee of the Employee Benefit Trust, held 9,782,375
shares (2.96%) in the Company as at 2 July 2023 on trust
for the benefit of employees of the Company. The voting
rights attaching to the shares held by the Employee Benefit
Trust are exercisable by the Trustee and there are no
restrictions on the exercise of the voting of or acceptance
of any offer relating to those shares.
All Directors will be seeking re-election at the upcoming
AGM for the reasons outlined on page 159.
D I V I D E N D WA I V E R
Details of Directors’ pay, service contracts and interests in
the ordinary shares of the Company are included in the
Directors’ Remuneration Report on page 182.
The liabilities of the Directors in connection with this report
shall be limited as provided by English law.
D I R E C TO R S I N T E R E S T S
Related party transactions are disclosed in note 22 to the
Financial Statements. A summary of remuneration provided
to key management personnel is provided in note 7c.
P O W E R S O F T H E D I R E C TO R S
Subject to the Company’s Articles of Association, UK
legislation and any special resolutions passed by the
Company, the business of the Company is managed by the
Board, which may exercise all the powers of the Company.
Directors have been authorised to allot and issue shares by
way of resolutions of the Company passed at its Annual
General Meeting.
The rules in relation to the appointment and replacement of
Directors are as set out in the Company’s Articles of
Association and applicable English company law. The
Articles of Association can only be amended, or new
Articles of Association adopted, by a resolution passed by
shareholders at a general meeting by at least three
quarters of the votes cast.
VOT I N G A N D T R A N S F E R O F S H A R E S
The Company’s Articles of Association do not contain any
specific restrictions on the size of a shareholder’s holding
or on the transfer of the Company’s shares.
The Company is not aware of any agreements between
shareholders that may result in restrictions on the transfer
of securities and/or voting rights in the Company.
The Company’s Articles of Association do not contain, and
the Company is not aware of, any restrictions on voting
rights, including any limitations on voting rights of holders
of a given percentage or number of votes, deadlines for
exercising voting rights and arrangements by which, with
In respect of those shares held within the Employee
Benefit Trust, during the year, Zedra agreed to waive
payment of the following dividends:
• the 2022 final dividend of 22p per share paid on
16 November 2022 in respect of 2,500,000 ordinary
shares; and
• the 2023 interim dividend of 10p per share paid on
6 April 2023 in respect of 4,000,000 ordinary shares.
The shares over which the dividends were waived were
held to satisfy Save As You Earn share options granted by
the Company which do not attract a dividend equivalent
payment. Therefore, there was no loss to the individual
employees of the Company by Zedra waiving the dividends
in respect of those shares.
S U B S TA N T I A L H O L D I N G S I N T H E C O M PA N Y
As at 2 July 2023, the Company had been advised of the
following notifiable interests in its ordinary shares, in
accordance with Rule 5 of the DTRs.
NOTIFIABLE PERSON
Bridgemere Securities
Limited1
NO. OF
ORDINARY
SHARES HELD
% OF
VOTING
RIGHTS
56,301,816
15.99%
Vidacos Nominees/HSBC2
18,770,138
5.08%
GLG Partners LP
19,487,673
5.89%
1
2
Notified prior to commencement of the Share Buyback Programme, an event
which altered the Issued Share Capital of the Company. The number of shares
held and % of voting rights is displayed as it was stated on the latest TR-1 Form
submitted to us by the Notifiable Person.
Notified prior to commencement of the B Share Scheme, which was
accompanied by a 20 for 21 consolidation, and the Share Buyback Programme,
both events which altered the Issued Share Capital of the Company. The
number of shares held and % of voting rights is displayed as it was stated on the
latest TR-1 Form submitted to us by the Notifiable Person.
The Company has not been notified of any changes to
the above interests, or any other notifiable interests,
since 2 July 2023 to 15 September 2023, being the latest
practicable date prior to publication of this report.
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Directors' report / continued
C H A N G E O F C O N T R O L
The Company’s banking facilities require repayment in the
event of a change of control. In addition, the Company’s
employee share incentive schemes contain provisions,
whereby, upon a change of control, outstanding options
and awards would vest and become exercisable by the
relevant employees, subject to the rules of the schemes.
There are no agreements between the Company and its
Directors or employees providing for compensation for loss
of office or employment in event of a takeover bid.
S I G N I F I C A N T E V E N T S P O S T Y E A R E N D
There have been no significant events affecting the
Company or its subsidiaries since the balance sheet date.
Q UA L I F Y I N G T H I R D PA R T Y I N D E M N I T Y P R OV I S I O N S
During the course of the year ended 2 July 2023,
qualifying third party indemnity provisions were in place.
The Company agreed to indemnify the Directors, former
Directors and the Company Secretary of the Company and
Associated Companies (as defined in Section 256 of the
Act), to the extent permitted by law and the Company’s
Articles of Association, against any liability arising: in
connection with any negligence, default, breach of duty or
breach of trust by them; and in connection with their duties,
powers or office, including in connection with the activities
of the Company or an Associated Company in its capacity
as a trustee of an occupational pension scheme.
The above indemnity provisions remain in force at the date
of this report. In addition, the Company maintains directors’
and officers’ insurance for each Director of the Company
and its Associated Companies.
R E S E A R C H A N D D E V E LO P M E N T
The Company has a centralised Product Development
Team charged with identifying and evaluating new
construction techniques and products. They are also
responsible for minimising risk and seeking opportunities
associated with future regulatory changes. In addition, the
Company has a centralised Sustainability team, as these
issues play a prominent role in the Company’s activities.
The Company recognises its responsibilities to the
community as a whole and has adopted an environment
strategy and framework which is a core part of the
Company’s objectives.
The charge to the income statement in respect of research
and development for the year ended 2 July 2023 was £1m
(2022: £0.6m).
C H A R I TA B L E A N D P O LI T I C A L D O N AT I O N S
The Company recognises the difference it can create
through its presence as a national housebuilder by
developing thriving communities through supporting the
local community and charitable projects. The Company and
its employees are actively involved in fundraising activities
for our selected charitable partners.
Divisions annually select a local charity to support which
has a purpose that aligns with one of the Group’s key
priorities. This allows each part of the business to choose a
charity that is meaningful to them in the communities in
which they operate. In accordance with Company policy,
the charity must be verified before any donations are made
to it and a record is maintained of all charitable
contributions made. The Group paid £0.2m in charitable
donations during the year, being £0.1m in support of
national charities and £0.1m in support of local charities.
The Company does not engage in or support any form of
political donations. No Group company or employee is
permitted to make a political donation in the name of the
Company and employees are instructed to be particularly
vigilant to ensure that political contributions are not made
in circumstances where gifts, hospitality or the actions of
third parties are engaged in transactions on behalf of the
Company. The Group made no political donations during
the year.
W O R K F O R C E E N G AG E M E N T
The Board believes that greater engagement with the
workforce is essential to preserving long-term value.
Valuing People is a fundamental part of the Group’s
strategy and understanding the views of employees and
actively encouraging their participation sits highly on the
Board’s agenda.
See page 140 of the Corporate Governance Report for
details of the work undertaken during the year in respect of
engagement with the workforce, including the Group's
arrangements to: provide employees with information on
matters of concern to them, including making employees
aware of the financial performance of the Company;
consult with employees to obtain their views; and
encourage employee involvement in the Company’s share
plans.
E Q UA LI T Y, D I V E R S I T Y A N D I N C LU S I O N P O LI C Y
The Company is firmly committed to giving every potential
recruit and employee the same opportunities irrespective
of their gender, race, ethnic or national origin, disability,
age, sexuality, religious belief, marital status or social class.
There is a strong commitment to continuously promoting
equality, diversity and inclusion ("ED&I") throughout the
business to build a culture that is inclusive to all, actively
values difference and ensures everyone is treated fairly.
As outlined in the Equality, Diversity and Inclusion Policy
(“ED&I Policy”), the Company gives full and fair
consideration to applications for employment made by
disabled people and is committed to offering training and
career development of disabled persons. The ED&I Policy
places a duty on the Company to take reasonable steps to
remove any disadvantage which a disabled person may
have compared with employees who are not disabled. In
the event of any employee becoming disabled, the
194
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Company makes every effort to ensure that their
employment continues, training needs are met and
reasonable adjustments are made to the working
environment.
The Company embeds its stance of diversity matters
through awareness and training in the following policies:
• Equality, Diversity and Inclusion Policy
• Recruitment and Selection Policy
The ED&I Policy is inherently linked to the Group’s strategy
through the pillar of Valuing People and is reviewed and
approved annually by the Nomination Committee. This
ensures that ED&I remains an active area of discussion
throughout the Group, from Divisional and Group-level all
the way up to the Main Board.
For details of how ED&I is considered by the Board and its
Committees, see page 159 of the Nomination Committee
Report. Details of the KPIs relating to Diversity and
Inclusion, including targets where applicable, can be seen
within the ESG Scorecard on page 258.
B U S I N E S S R E L AT I O N S H I P S
A summary of how the Board has had regard to the need to
foster the Company’s business relationships with suppliers,
customers and others, and the effect of this on the
decisions taken by the Company, can be found within the
Stakeholder Engagement table on pages 118 to 129.
G R E E N H O U S E G A S E M I S S I O N S
Greenhouse Gas (GHG) emissions data for the period
4 July 2022 to 2 July 2023 are set out in the table below.
This disclosure includes all emission sources required
under the Companies Act 2006 (Strategic Report and
Directors’ Report) Regulations 2013. These sources fall
within our consolidated financial statement, and we do not
have responsibility for any emission sources that are not
included in our consolidated statement.
The Company has used the WRI/WBCSD GHG Protocol –
A Corporate Accounting and Reporting Standard and the
emissions have been calculated using the 2023 UK
Government’s Greenhouse Gas Conversion Factors
(DEFRA) for Company Reporting. Reported Scope 2
emissions are calculated using both the location-based
and market-based methods.
This inventory of greenhouse gas emissions has been
verified by SGS to a limited level of assurance, in
accordance with the requirements of EN ISO 14064-3:2019,
as meeting the requirements of The Greenhouse Gas
Protocol – A Corporate Accounting and Reporting
Standard. Further details and the independent assurance
report can be found on our website: https://www.
redrowplc.co.uk/sustainability/esg-disclosures/
During the reporting period, the annual quantity of energy
consumed by the Company was 44,003,874 kWh. This
figure presents the underlying global energy use data that
was used to calculate the GHG emissions and is calculated
in kWh. Where information has been converted to kWh
from other units (e.g. litres of fuel), the 2023 UK
Government’s Greenhouse Gas Conversion Factors for
EMISSIONS FROM:
Scope 1 activities:
• Direct emissions from combustion of fuels and
business travel
Scope 2 activities – Location Based:
• Indirect emissions from purchased electricity and
heat
Scope 2 activities – Market Based
Outside of Scopes 1
Total Greenhouse Gas Emissions – Location Based:
CURRENT
REPORTING
YEAR
PREVIOUS
YEAR
(4 JULY 22 TO
(28 JUNE 21
2 JULY 23)
TO 3 JULY 22)
UNITS
7,726
9,558
Tonnes of CO2e
2,568
592
0.46
2,591
264
3
Tonnes of CO2e
Tonnes of CO2e
Tonnes of CO2e
• (Scope 1 and Scope 2)
10,294
12,149
Tonnes of CO2e
Total Greenhouse Gas Emissions – Market Based:
• (Scope 1 and Scope 2)
Intensity ratio:
8,318
9,822
Tonnes of CO2e
Total Greenhouse Gas emissions per 100m2 of build
(Location Based)
2.07
2.16
Tonnes of CO2e per 100m2 of build
1
These are emissions resulting from the use of HVO and should be reported separately to scope 1 emissions under ‘outside of scopes’ as detailed in the UK
Government Greenhouse Gas Conversion Factors file and the GHG Protocol Corporate Accounting and Reporting Standard.
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The Chelford house type at
Tabley Park, Knutsford, Cheshire.
Directors' report / continued
Company Reporting have been used for the required
conversions.
This figure is the aggregate of:
• the annual quantity of energy consumed from activities
for which the Company is responsible involving the
combustion of fuel;
• the annual quantity of energy consumed resulting from
the purchase of electricity and heat by the company for
its own use; and
• the annual quantity of energy consumed from activities
for which the Company is responsible, involving the
consumption of fuel for the purposes of transport.
100% of the figures reported above relate to emissions and
energy consumed solely in the United Kingdom.
The Company has taken several measures for the purpose
of reducing greenhouse gas emissions and increasing the
Company's energy efficiency, including:
• Reducing construction site diesel use in generators and
site equipment by 25%. This is a result of more efficient
use of vehicles and machinery, and securing earlier
connections to the electricity grid, which allows for
quicker transition to electric power for site cabins.
• The roll out of energy-efficient site cabins with a B+
rating compared with the previous D rating. These
provide improved thermal insulation, double glazed
windows with low u-values, energy efficient LED lights
with PIR activation, thermostatically controlled heaters
with thermal cut-out and energy efficient point-of-use hot
water taps. To reduce emissions further the use of solar
panels or hybrid generators is being trialled, along with
smart distribution boards to better manage consumption.
• Reducing gas, electricity and heat consumption, down by
10%. Reduction from our site use has been driven in part
by minimising the time between build completion and
handover to homeowner, resulting in a lower period of
energy consumption of gas (40% reduction) and
electricity (23% reduction) in comparison to the previous
financial period.
• Procurement of 88% of our electricity from renewable
sources (backed by Renewable Energy Guarantees of
Origin). Due to a change in supplier part way through the
year, and a decision not to sign a longer-term contract
when energy prices were at their peak, our percentage
of renewable energy use has reduced against last year,
however a new 100% renewable contract is now in place.
• The steady progress made on the Company’s
commitment to reduce the carbon impact from its
company car fleet has seen over 100 more employees
opt for all electric cars, with 73% of company cars
ordered during the year being either Hybrid or Pure
Electric. The current fleet car mix is now 54% electric,
with an EV option available at all grades. Despite miles
covered increasing back to pre-pandemic levels, our
emissions have reduced by 11.5% in the last year.
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• The exploration of the viability of installing solar
photovoltaic panels on the Company’s divisional and
head office buildings. The payback period is favourable,
at around six to seven years, with installation complete at
South Midlands divisional office. Further installation will
be considered across other offices in the next few years.
C O R P O R AT E G OV E R N A N C E A R R A N G E M E N T S
The Board remains committed to high standards of
corporate governance. Details relating to the Company’s
governance arrangements and compliance with the UK
Corporate Governance Code are provided in the Corporate
Governance Report on pages 132 to 199.
A N N UA L G E N E R A L M E E T I N G
Notice of the 2023 Annual General Meeting to be held on
Friday, 10 November 2023 will be sent to shareholders
separately. Members wishing to vote, should return forms
of proxy to the Company’s Registrar not less than 48 hours
before the time for holding the meeting.
The formal notice convening the Annual General Meeting,
together with explanatory notes, will be found in a separate
circular which will be sent to shareholders separately and
will be available on the Company’s website. Shareholders
will also find with the Notice of Annual General Meeting a
form of proxy for use in connection with the meeting.
P R OV I S I O N O F I N F O R M AT I O N TO AU D I TO R S
Each Director in office at the date the Directors’ Report is
approved, confirms that:
• so far as the Director is aware, there is no relevant audit
information (as defined in section 418(3) of the Act) of
which the Company’s external auditors are unaware; and
• they have taken all of the steps that they ought to have
taken as a Director in order to make themselves aware of
any such relevant audit information and to establish that
the Company’s external auditors are aware of that
information.
G O I N G C O N C E R N
In considering whether it is appropriate to prepare these
financial statements on a going concern basis, the
Directors have conducted a detailed going concern review,
considering the Group’s liquidity and banking covenant
compliance.
Following the review, details of which can be found within
the Going Concern Basis of Preparation section of
Accounting Policies on page 214, the Directors consider
that the Group has adequate resources in place for the
forecast period and have therefore adopted the going
concern basis of accounting in preparing these financial
statements.
By order of the Board
Graham Cope
Company Secretary
Redrow plc
Registered no: 2877315
15 September 2023
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Statement of Directors' responsibilities
STATEMENT OF DIRECTORS'
RESPONSIBILITIES
Under applicable law and regulations, the Directors are
also responsible for preparing a Strategic Report,
Directors’ Report, Directors’ Remuneration Report and
Corporate Governance Statement that complies with that
law and those regulations.
The Directors are responsible for the maintenance and
integrity of the corporate and financial information included
on the Company’s website. Legislation in the UK governing
the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.
In accordance with Disclosure Guidance and Transparency
Rule 4.1.14R, the financial statements will form part of the
annual financial report prepared using the single electronic
reporting format under the TD ESEF Regulation. The
auditor’s report on these financial statements provides no
assurance over the ESEF format.
R E S P O N S I B I LI T Y S TAT E M E N T O F T H E D I R E C TO R S I N
R E S P E C T O F T H E A N N UA L F I N A N C I A L R E P O R T
We, the Directors, confirm that to the best of our
knowledge:
• the financial statements, prepared in accordance with
the applicable set of accounting standards, give a true
and fair view of the assets, liabilities, financial position
and profit or loss of the Company and the undertakings
included in the consolidation taken as a whole; and
• the strategic report includes a fair review of the
development and performance of the business and the
position of the issuer and the undertakings included in
the consolidation taken as a whole, together with a
description of the principal risks and uncertainties that
they face.
We consider the annual report and accounts, taken as a
whole, is fair, balanced and understandable and provides
the information necessary for shareholders to assess the
Group’s position and performance, business model and
strategy.
The Directors are responsible for preparing the Annual
Report and the Group and parent Company financial
statements in accordance with applicable law and
regulations.
Company law requires the Directors to prepare Group and
parent Company financial statements for each financial
year. Under that law they are required to prepare the Group
financial statements in accordance with UK-adopted
international accounting standards and applicable law and
have elected to prepare the parent Company financial
statements on the same basis.
Under company law the 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
parent Company and of the Group’s profit or loss for that
period. In preparing each of the Group and parent
Company financial statements, the Directors are required
to:
• select suitable accounting policies and then apply them
consistently;
• make judgements and estimates that are reasonable,
relevant and reliable;
• state whether they have been prepared in accordance
with UK-adopted international accounting standards;
• assess the Group and parent Company’s ability to
continue as a going concern, disclosing, as applicable,
matters related to going concern; and
• use the going concern basis of accounting unless they
either intend to liquidate the Group or the parent
Company or to cease operations, or have no realistic
alternative but to do so.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the parent Company’s transactions and disclose with
reasonable accuracy at any time the financial position of
the parent Company and enable them to ensure that its
financial statements comply with the Companies Act 2006.
They are 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, and have
general responsibility for taking such steps as are
reasonably open to them to safeguard the assets of the
Group and to prevent and detect fraud and other
irregularities.
198
The Directors of the Company who were in office during
the year were:
Richard Akers
Non-Executive Chairman
Matthew Pratt
Group Chief Executive
Barbara Richmond
Group Finance Director
Nick Hewson 1
Nicky Dulieu
Senior Independent Director
and Non-Executive Director
Senior Independent Director
and Non-Executive Director
Oliver Tant
Non-Executive Director
Geeta Nanda 2
Non-Executive Director
1 Nick Hewson stepped down from the Board on 11 November 2022
2 Geeta Nanda joined the Board on 1 May 2023
By order of the Board
Graham Cope
Company Secretary
15 September 2023
Redrow plc
Redrow House
St. David’s Park
Flintshire
CH5 3RX
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199
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Governance reportGovernance report
I N D EPEN D ENT AU D ITO R ' S R EP O RT
To the members of Redrow plc
1. Our opinion is unmodified
We have audited the financial statements of Redrow plc
(“the Company”) for the 52 week period ended 2 July 2023
which comprise the Consolidated Income Statement, the
Group and Company Statement of Comprehensive Income,
the Group and Company Balance Sheets, the Group and
Company Statement of Changes in Equity, the Group and
Company Statement of Cash Flows, and the related notes,
including the accounting policies on pages 210 to 249.
In our opinion:
–
–
–
–
the financial statements give a true and fair view of the
state of the Group’s and of the Parent Company’s
affairs as at 2 July 2023 and of the Group’s profit for
the 52 weeks period then ended;
the Group financial statements have been properly
prepared in accordance with UK-adopted international
accounting standards;
the Parent Company financial statements have been
properly prepared in accordance UK-adopted
international accounting standards and as applied in
accordance with the provisions of the Companies Act
2006; and
the financial statements have been prepared in
accordance with the requirements of the Companies
Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (“ISAs (UK)”) and applicable
law. Our responsibilities are described below. We believe
that the audit evidence we have obtained is a sufficient
and appropriate basis for our opinion. Our audit opinion is
consistent with our report to the audit committee.
We were first appointed as auditor by the shareholders on
6 November 2019. The period of total uninterrupted
engagement is for the four financial periods ended 2 July
2023. We have fulfilled our ethical responsibilities under,
and we remain independent of the Group in accordance
with, UK ethical requirements including the FRC Ethical
Standard as applied to listed public interest entities. No
non-audit services prohibited by that standard were
provided.
Overview
Materiality:
group financial
statements as a
whole
Coverage
Key audit matters
Recurring risks
Parent Company
Key Audit Matter
£19.2m (2022:£20.4m)
5% of Group profit before tax
(2022: 5% of Group profit before
exceptional items and tax)
100% of group profit before tax
(2022: 100% of Group profit before
exceptional items and tax)
vs 2022
Cost of sales
recognition and
carrying amount of
work in progress
Fire Safety Provision
Valuation of defined
benefit pension
obligation
2. Key audit matters: our assessment of risks of
material misstatement
Key audit matters are those matters that, in our
professional judgement, were of most significance in the
audit of the financial statements and include the most
significant assessed risks of material misstatement
(whether or not due to fraud) identified by us, 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. We
summarise below the key audit matters, in decreasing
order of audit significance, in arriving at our audit opinion
above, together with our key audit procedures to address
those matters and, as required for public interest entities,
our results from those procedures. These matters were
addressed, and our results are based on procedures
undertaken, in the context of, and solely for the purpose of,
our audit of the financial statements as a whole, and in
forming our opinion thereon, and consequently are
incidental to that opinion, and we do not provide a
separate opinion on these matters.
The risk
Our response
Cost of sales
recognition and
carrying
amount of work
in progress
Cost of sales
(£1,619 million;
2022: £1,788
million); carrying
amount of work
in progress
(£1,017 million;
2022: £962
million).
Refer to page
148 (Audit
Committee
Report), page
217 (accounting
policy) and
page 241
(financial
disclosures).
Subjective judgements:
The Group holds inventory in the form of
land for development, work in progress
and show homes. Cost of sales and
inventory (excluding land) is recognised at
standard cost and any abnormal costs are
expensed to cost of sales as incurred.
The current macro-economic conditions,
including high levels of inflation and
extended development timescales, have
resulted in an increase in the level of build
cost variances. As a result, there is a risk
that the standard cost on certain
developments no longer accurately
approximates the actual build cost.
Judgement is applied in determining the
classification of build cost variances as
abnormal costs and those that require the
standard cost to be revised.
The judgements made are profit impacting
and therefore there is an incentive for
management to manipulate the
assumptions made to meet profit targets.
The effect of these matters is that, as part
of our risk assessment, we determined
that the carrying value of work in progress
and the recognition of cost of sales due to
the accuracy of the standard cost, involves
a high degree of judgement.
The financial statements note 1 on page
221 disclose judgements made by the
Group.
We performed the detailed tests below rather than
seeking to rely on the Group’s control, because
our knowledge of the design of the control
indicated that we would not be able to obtain the
required evidence to support reliance on the
control.
Our procedures included:
–
–
–
Testing application: We challenged the
Group’s judgement on the classification of
build costs variances as abnormal costs or
variances that require an adjustment to the
standard cost in accordance with IAS 2 by
assessing the nature of the additional
variances to supporting documentation such
as subcontractor valuations, third party quotes
and invoices. We obtained corroborative
evidence through inquiries with Divisional
commercial teams in instances where third
party evidence wasn’t available due to the
nature of the variance.
Enquiry of personnel: We made inquiries with
the Group Commercial Director, Group’s
Quantity Surveyors and Divisional commercial
teams to understand variances on a sample of
developments and assess whether the Group’s
policy is applied consistently across the
Group.
Assessing transparency: We assessed
whether the Group’s disclosure in respect of
costs of sales recognition and the carrying
amount of work in progress, including key
judgements, have been adequately disclosed.
We performed an assessment of whether the
overstatement of cost of sales and understatement
of work in progress identified through these
procedures were material, taking into account
findings from other areas of the audit and
qualitative aspects of the financial statements as a
whole.
Our results:
We consider the cost of sales recognition and the
carrying amount of work in progress to be
acceptable (2022: acceptable).
200
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Independent auditor's reportto the members of Redrow plc The risk
Our response
The risk
Our response
Fire Safety
Provision
(£188 million;
2022: £200
million).
Refer to page
148 (Audit
Committee
Report), page
220 (accounting
policy) and
pages 245 and
246 (financial
disclosures).
Subjective estimates:
In common with many in the sector the
Group signed up to the Building Safety
Fund (‘BSF’) pledge in April 2022 (‘the
Pledge’) and signed the self-remediation
terms (‘SRT’) in March 2023 which
replaced the Pledge and the Welsh
Government’s Pledge Deed of Bilateral
Contract in April 2023. In signing up to the
SRT and the Welsh Government’s Deed of
Bilateral Contract (‘SRT Deed’), the Group
has agreed to remediate both external and
internal life-critical fire safety issues on all
properties over 11 metres in, England and
Wales, where Redrow was the developer,
going back 30 years. In comparison to ‘the
Pledge’, the SRT has widened the
developers’ responsibilities to also include
potential remediation works on internal
communal areas.
Estimation of the provision requires
identification of the impacted properties,
an assessment of the defects requiring
remediation, and the likely costs. The
Group’s estimated provision will be
subject to further refinement as the
remediation work and tendering process
progresses and detailed building
inspections continue.
The effect of this matter is that, as part of
our risk assessment, we determined that
the amount of the provision required for
fire safety remediation has a high degree
of estimation uncertainty, with a potential
range of reasonable outcomes greater
than our materiality for the financial
statements as a whole, and possibly many
times that amount. The financial
statements note 1 on pages 245 and 246
disclose the sensitivity estimated by the
Group.
We performed the tests below rather than seeking
to rely on any of the Group’s controls because our
knowledge of the design of these controls
indicated that we would not be able to obtain the
required evidence to support relying on them. Our
procedures included:
Test of details: We evaluated the existence and
extent of the obligation for the Group to remediate
life critical fire safety issues by obtaining the SRT
and SRT Deed for England and Wales respectively,
performing a comparison between the SRT and the
April 2022 Pledge and evidence to understand the
Group’s commitments in Scotland and Northern
Ireland.
Test of details: We assessed the completeness
and accuracy of the population of properties over
11 metres that were developed by the Group going
back 30 years by comparing the Group’s list of
properties to external evidence including direct
confirmation from the Department for Levelling Up,
Housing and Communities (‘DLUHC’), a list of
buildings included in the SRT, the Welsh SRT Deed,
reviewing board minutes, and enquiring with the
Group's internal legal counsel.
Test of details: For those properties with approved
BSF claims, we agreed the amount included within
the provision to the direct confirmation from
DLUHC.
Test of details: For a sample of properties where
remediation work has commenced, we agreed the
costings to underlying supporting documents such
as quantity surveyor appraisals, contractor invoices
and contracts.
Benchmarking of assumptions: For those
properties where the internal and external
remediation costs have been estimated, we
challenged the appropriateness of the provision
methodology prepared by management and
assessed the reasonableness of key assumptions
that the Group have assigned to estimate the
external and internal costs per plot and plot
numbers by benchmarking to comparable data,
inspecting External Wall System ('EWS1’)
certificates and correspondences from
management companies of the relevant properties.
Historical comparisons: For a sample of
properties, we performed a retrospective review
by comparing actual remediation costs incurred to
the Group’s previously estimated cost to evaluate
the Group’s forecasting accuracy.
Sensitivity analysis: We performed analysis on the
potential range of possible outcomes in respect of
the estimation of remediation costs under the SRT.
Sector experience: We utilised our Quantity
Surveyor specialists to assist us in challenging the
appropriateness of remediation assumptions. We
also evaluated the competence, independence
and integrity of the management's experts.
Assessing transparency: We assessed whether
the Group’s disclosures in respect of the fire safety
provision, including the sensitivity of the provision
to changes in key assumptions, have been
adequately disclosed.
Our results:
We consider the amount of fire safety provision
recognised to be acceptable (2022: acceptable).
Valuation of
the defined
benefit
obligation
(Parent
Company only)
(£74 million;
2022: £97
million)
Refer to page
148 (Audit
Committee
Report), page
218 (accounting
policy) and
pages 229 and
232 (financial
disclosures).
Low risk, high value:
As part of our risk assessment, we
determined that the valuation of the
defined benefit obligation is not a
significant risk of material misstatement
due to low estimation uncertainty. The
potential range of outcomes as a result of
reasonable changes in key assumptions,
in particular those relating to mortality,
price inflation rate and the discount rate, is
lower than our materiality for the financial
statements as a whole.
However, due to the defined benefit
obligation’s materiality in the context of
the parent Company financial statements,
this is considered to be the area that will
have the greatest effect on our overall
parent Company audit.
Due to the nature of the scheme and the
value of the defined benefit obligation in
relation to Group materiality, we have not
assessed this as an area that had the
greatest effect on our current year audit
for the Group and is therefore included as
a parent Company key audit matter only.
We performed the tests below rather than seeking
to rely on any of the parent company’s controls
because our knowledge of the design of these
controls indicated that we would not be able to
obtain the required evidence to support relying on
them.
Our procedures included:
–
–
–
Benchmarking assumptions: We challenged
the key assumptions applied in the calculation
of the obligation, including those relating to
price inflation, discount rate and mortality,
against externally derived market data.
Assessing actuary's credentials: We
assessed the competence, independence and
integrity of Group’s external actuarial expert.
Assessing transparency: We considered the
adequacy of the Group and Parent Company’s
disclosures relating to the defined benefit
obligations and buy-in transaction.
Our results:
We consider the carrying amount of defined
benefit obligation to be acceptable (2022:
acceptable).
In the prior year audit our key audit matter was in relation to Cost of sales recognition and carrying amount of land held
for development was identified as having significant estimation uncertainty however we have not assessed this as one of
the most significant risks in our current year audit and, therefore, have directed our efforts on the judgements involved in
assessing the impact of build cost variances on the standard cost. We continue to perform procedures over the carrying
value of land held for development. However, due to lower levels of land acquisitions in the year, and a number of sites
having obtained planning permission during the year, we have not assessed this as one of the most significant risks in
our current year audit and, therefore, it is not separately identified in our report this year.
202
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Independent auditor's reportto the members of Redrow plc 3. Our application of materiality and an overview of
the scope of our audit
Performance materiality for the Parent Company was set at
75% (2021: 75%) of materiality which equates to £13.5
million (2022: £12.4 million).
Materiality for the Group financial statements as a whole
was set at £19.2 million (2022: £20.4 million) determined
with reference to a benchmark of Group profit before tax in
the 52 week period ended 2 July 2023 of £395.0 million
(2022: Group profit before exceptional items and tax of
£410.0 million), of which it represents 5% (2022: 5%).
Materiality for the Parent Company financial statement as a
whole was set at £18.0 million (2022: £16.5 million),
determined with reference to a benchmark of net assets, of
which it represents 1.5% (2022: 2.0%).
In line with our audit methodology, our procedures on
individual account balances and disclosures were
performed to a lower threshold, performance materiality, so
as to reduce to an acceptable level the risk that individually
immaterial misstatements in individual account balances
add up to a material amount across the financial statements
as a whole.
Performance materiality for the Group was set at 75%
(2022: 75%) of materiality for the financial statements as a
whole, which equates to £14.4 million (2022: £15.3 million).
We applied this percentage in our determination of
performance materiality because we did not identify any
factors indicating an elevated level of risk.
We agreed to report to the Audit Committee any corrected
or uncorrected identified misstatements exceeding £0.9
million (2022: £1.0 million), in addition to other identified
misstatement that warranted reporting on qualitative
grounds.
The scope of the audit work performed was fully
substantive as we did not rely upon the Group’s internal
control over financial reporting.
Of the Group’s 9 (2022: 9) reporting components, we
subjected 2 (2022: 2) to full scope audits for Group
purposes. For the residual 7 (2022: 7) components, we
performed an analysis at an aggregated Group level to
re-examine our assessment that there were no significant
risks of material misstatement within these. The
components within the scope of our work accounted for
the percentages illustrated opposite.
The component materialities ranged from £9.0 million to
£19.0 million (2022: £10.0 million to £20.0 million), having
regards to the mix of size and risk profile of the Group
across the components.
Our audit of the Group and Components was all performed
by the Group audit team.
Group profit before tax
£395.0m (2022: £246.0m)
Group Materiality
£19.2m (2022: £20.4m)
£19.2m
Whole financial statements materiality
(2022: £20.4m)
£14.4m
Whole financial statements performance materiality
(2022: £15.3m)
£19.0m
Range of materiality at 2 components (£9m – £19m)
(2022: £10m to £20m)
n Group PBT
n Group Materiality
£0.95m
Misstatements reported to the audit committee
(2022: £1m)
Group revenue
Group profit before tax
Group total assets
0
1
100%
(2022: 99%)
99
100
1
0
0
100%
(2022: 100%)
100
100
9
12
91%
(2022:88%)
88
91
n Full scope for Group audit purposes 2023
n Residual components 2023
n Full scope for Group audit purposes 2022
n Residual components 2022
4. The impact of climate change on our audit
In planning our audit, we have considered the potential
impact of risks arising from climate change on the Group’s
business including the impact of the commitments made by
the Group and the changes to building and planning
regulations in respect of climate change on its financial
statements.
As part of our audit we have performed a risk assessment,
including making enquiries of management, reading board
minutes and applying our knowledge of the Group and
sector in which it operates in order to understand the
extent of the potential impact of climate change risk on the
Group’s financial statements. We also held discussions
with our own climate change professionals to challenge our
risk assessment.
Taking into account our risk assessment procedures we
have assessed the key area contained within the financial
statements for which climate change could have the
greatest impact to be the net realisable value of land not
yet in development and without planning due to future
potential changes to building and planning regulations in
respect of climate change. We concluded that climate risk
has no material effect on future build costs for those sites
currently in development and therefore on the cost of sales
recognition or the carrying amount of work in progress.
We have read the Group’s TCFD disclosures in the Annual
Report and considered consistency with the financial
statements and our audit knowledge.
Company’s financial position means that this is realistic.
They have also concluded that there are no material
uncertainties that could have cast significant doubt over
their ability to continue as a going concern for at least a
year from the date of approval of the financial statements
(“the going concern period”).
We used our knowledge of the Group, its industry, and the
general economic environment to identify the inherent
risks to its business model and analysed how those risks
might affect the Group’s and Parent Company’s financial
resources or ability to continue operations over the going
concern period. The risks that we considered most likely to
adversely affect the Group’s and Parent Company’s
available financial resources over this period were a
possible reduction in sales volumes and prices as well as
increased cost inflation as a consequence of changes in
the economic environment, leading to sustained medium-
term decline in revenue and profits.
We also considered less predictable, but realistic second
order Impacts such as disruption to the Group’s supply
chain.
We considered whether these risks could plausibly affect
the liquidity or covenant compliance in the going concern
period by assessing the directors’ sensitivities over the
level of available financial resources and covenant
thresholds indicated by the Group’s financial forecasts
taking account of severe, but plausible adverse effects that
could arise from these risks individually and collectively.
Our procedures also included:
5. Going concern
The directors have prepared the financial statements on
the going concern basis as they do not intend to liquidate
the Group or the Company or to cease their operations,
and as they have concluded that the Group’s and the
–
critically assessing assumptions in the base case and
downside scenarios, particularly in relation to forecast
liquidity, profitability and performance, including
assessing consistency to external information such as
industry and economic forecasts;
204
205
Independent auditor's reportto the members of Redrow plc
assessing whether downside scenarios applied
mutually consistent assumptions in aggregate, taking
into account all reasonably possible downsides, using
our assessment of the possible range of each key
assumptions and our knowledge of the Group and the
industry;
–
enquiring of directors, the audit committee, internal
legal counsel and inspection of policy documentation
as to the Group’s high level policies and procedures to
prevent and detect fraud, including the internal audit
function, and the Group’s channel for ‘whistleblowing’,
as well as whether they have any knowledge of any
actual, suspected or alleged fraud;
–
reading Board and all relevant committee minutes;
–
–
–
–
–
–
–
–
comparing past budgets to actual results to assess the
directors’ track record of budgeting accurately;
inspecting confirmation from banks of the level of cash
and cash equivalents held at year end and loan facility
documentation including covenant requirements;
selecting a sample from the forward order book and
corroborating to sales and reservation contracts; and
considering whether the going concern disclosure on
page 214 of the financial statements gives a full and
accurate description of the directors’ assessment of
going concern, including the identified risks,
dependencies, and related sensitivities.
–
–
–
Our conclusions based on this work:
we consider that the directors’ use of the going
concern basis of accounting in the preparation of the
financial statements is appropriate;
we have not identified, and concur with the directors’
assessment that there is not, a material uncertainty
related to events or conditions that, individually or
collectively, may cast significant doubt on the Group’s
or Company's ability to continue as a going concern for
the going concern period;
–
we have nothing material to add or draw attention to in
relation to the directors’ statement on page 196 of the
financial statements on the use of the going concern
basis of accounting with no material uncertainties that
may cast significant doubt over the Group and Parents
Company’s use of that basis for the going concern
period, and we found the going concern disclosure on
page 214 to be acceptable; and
–
the related statement under the Listing Rules set out
on page 196 is materially consistent with the financial
statements and our audit knowledge.
However, as we cannot predict all future events or
conditions and as subsequent events may result in
outcomes that are inconsistent with judgements that were
reasonable at the time they were made, the above
conclusions are not a guarantee that the Group or the
Company will continue in operation.
6. Fraud and breaches of laws and regulations
– ability to detect
Identifying and responding to risks of material
misstatement due to fraud
To identify risks of material misstatement due to fraud
(“fraud risks”) we assessed events or conditions that could
indicate an incentive or pressure to commit fraud or
provide an opportunity to commit fraud. Our risk
assessment procedures included:
206
considering remuneration incentive schemes and
performance targets for management and directors,
including any revenue and trading margin targets for
management and directors’ remuneration;
using analytical procedures to identify any unusual or
unexpected relationships; and
consultation with our own forensic professionals
regarding the identified fraud risks and the design of
the audit procedures planned in response to these.
This involved the forensic professional holding an
initial fraud brainstorming session as well as further
discussions between the engagement team and the
forensic professional, particularly in respect of our risk
assessment and audit response following the failure of
one of the divisions to account accurately for
development profit at the beginning of the financial
period, as reported in our 2022 audit report;
we assessed the adequacy of the disclosures on page
153 of the Audit committee report within the
Governance report related to a failure by one of the
divisions to account accurately for development profit,
including the omission of incurred costs overruns, for
consistency with our knowledge and understanding
acquired during the audit.
We communicated identified fraud risks throughout the
audit team and remained alert to any indications of fraud
throughout the audit.
As required by auditing standards, and taking into account
our overall knowledge of the control environment, we
perform procedures to address the risk of management
override of controls, in particular the risk that management
may be in a position to make inappropriate accounting
entries and the risk of bias in accounting estimates and
judgements such as costs of sales recognition, the carrying
value of work in progress and the fire safety provision.
On this audit we do not believe there is a fraud risk related
to revenue recognition as the accounting for the majority of
the Group’s revenue is non-complex and only recognised
on the legal completion of the sale, being the point at
which the balance of the sales is paid for and the title of
the property transfers to the customer. There are therefore
limited levels of judgement with limited opportunities for
manual intervention in the sales process to fraudulently
manipulate revenue.
We also identified fraud risks related to the cost of sales
recognition and carrying amount of work in progress as
well as related to the fire safety provision in response to
the significance of the accounting estimates.
Context of the ability of the audit to detect fraud or
breaches of law or regulation
We also performed procedures including:
–
Identifying journal entries and other adjustments to
test based on risk criteria and comparing the identified
entries to supporting documentation. These included
those posted to unusual or unexpected account
combinations, including revenue, cost of sales and
cash; and
– Assessing significant accounting estimates for bias.
Identifying and responding to risks of material
misstatement due to non-compliance with laws and
regulations
We identified areas of laws and regulations that could
reasonably be expected to have a material effect on the
financial statements from our general commercial and
sector experience, through discussion with the directors
and other management (as required by auditing standards)
and from inspection of the Group’s regulatory and legal
correspondence as well as discussion with the directors
and other management over the policies and procedures
regarding compliance with laws and regulations.
As the Group is regulated, our assessment of risks involved
gaining an understanding of the control environment
including the entity’s procedures for complying with
regulatory requirements.
We communicated identified laws and regulations
throughout our team and remained alert to any indications
of non-compliance throughout the audit.
The potential effect of these laws and regulations on the
financial statements varies considerably.
Firstly, the Group is subject to laws and regulations that
directly affect the financial statements including financial
reporting legislation (including related companies
legislation), distributable profits legislation, taxation
legislation and the building safety act and we assessed the
extent of compliance with these laws and regulations as
part of our procedures on the related financial statement
items.
Secondly , the Group is subject to many other laws and
regulations where the consequences of non-compliance
could have a material effect on amounts or disclosures in
the financial statements, for instance through the
imposition of fines or litigation or the loss of the Group’s
licence to operate. We identified the following areas as
those most likely to have such an effect: UK planning,
building regulations, health and safety, data protection
laws, anti-bribery, anti money laundering and sanctions
checking, employment laws and environmental laws.
Auditing standards limit the required audit procedures to
identify non-compliance with these laws and regulations to
enquiry of the directors and other management and
inspection of regulatory and legal correspondence, if any.
Therefore if a breach of operational regulations is not
disclosed to us or evident from relevant correspondence,
an audit will not detect that breach.
Owing to the inherent limitations of an audit, there is an
unavoidable risk that we may not have detected some
material misstatements in the financial statements, even
though we have properly planned and performed our audit
in accordance with auditing standards. For example, the
further removed non-compliance with laws and regulations
is from the events and transactions reflected in the financial
statements, the less likely the inherently limited procedures
required by auditing standards would identify it.
In addition, as with any audit, there remained a higher risk
of non-detection of fraud, as these may involve collusion,
forgery, intentional omissions, misrepresentations, or the
override of internal controls. Our audit procedures are
designed to detect material misstatement. We are not
responsible for preventing non-compliance or fraud and
cannot be expected to detect non-compliance with all laws
and regulations.
7. We have nothing to report on the other
information in the Annual Report
The directors are responsible for the other information
presented in the Annual Report together with the financial
statements. Our opinion on the financial statements does
not cover the other information and, accordingly, we do not
express an audit opinion or, except as explicitly stated
below, any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in
doing so, consider whether, based on our financial
statements audit work, the information therein is materially
misstated or inconsistent with the financial statements or
our audit knowledge. Based solely on that work we have
not identified material misstatements in the other
information.
Strategic report and directors’ report
Based solely on our work on the other information:
–
–
–
we have not identified material misstatements in the
strategic report and the directors’ report;
in our opinion the information given in those reports
for the financial year is consistent with the financial
statements; and
in our opinion those reports have been prepared in
accordance with the Companies Act 2006.
Directors’ remuneration report
In our opinion the part of the Directors’ Remuneration
Report to be audited has been properly prepared in
accordance with the Companies Act 2006.
Disclosures of emerging and principal risks and longer-
term viability
We are required to perform procedures to identify whether
there is a material inconsistency between the directors’
disclosures in respect of emerging and principal risks and
the viability statement, and the financial statements and
our audit knowledge.
207
Independent auditor's reportto the members of Redrow plc decisions of users taken on the basis of the financial
statements.
A fuller description of our responsibilities is provided on
the FRC’s website at www.frc.org.uk/
auditorsresponsibilities.
The Company is required to include these financial
statements in an annual financial report prepared using the
single electronic reporting format specified in the TD ESEF
Regulation. This auditor’s report provides no assurance
over whether the annual financial report has been
prepared in accordance with that format.
10. The purpose of our audit work and to whom we
owe our responsibilities
This report is made solely to the Company’s members, as a
body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the Company’s members those
matters we are required to state to them in an auditor’s
report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume
responsibility to anyone other than the Company and the
Company’s members, as a body, for our audit work, for this
report, or for the opinions we have formed.
Paul Glendenning (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
8 Princes Parade
Liverpool
L3 1QH
15 September 2023
Based on those procedures, we have nothing material to
add or draw attention to in relation to:
–
the section of the annual report that describes the
review of the effectiveness of the Group’s risk
management and internal control systems.
–
–
–
the directors’ confirmation on page 90 that they have
carried out a robust assessment of the emerging and
principal risks facing the Group, including those that
would threaten its business model, future performance,
solvency and liquidity;
the risk management report disclosures describing
these risks and how emerging risks are identified, and
explaining how they are being managed and mitigated;
and
the directors’ explanation in the viability statement of
how they have assessed the prospects of the Group,
over what period they have done so and why they
considered that period to be appropriate, and their
statement as to whether they have a reasonable
expectation that the Group will be able to continue in
operation and meet its liabilities as they fall due over
the period of their assessment, including any related
disclosures drawing attention to any necessary
qualifications or assumptions.
We are also required to review the viability statement, set
out on page 100 under the Listing Rules. Based on the
above procedures, we have concluded that the above
disclosures are materially consistent with the financial
statements and our audit knowledge.
Our work is limited to assessing these matters in the
context of only the knowledge acquired during our
financial statements audit. As we cannot predict all future
events or conditions and as subsequent events may result
in outcomes that are inconsistent with judgements that
were reasonable at the time they were made, the absence
of anything to report on these statements is not a
guarantee as to the Group’s and Company’s longer-term
viability.
Corporate governance disclosures
We are required to perform procedures to identify whether
there is a material inconsistency between the directors’
corporate governance disclosures and the financial
statements and our audit knowledge.
Based on those procedures, we have concluded that each
of the following is materially consistent with the financial
statements and our audit knowledge:
–
–
the directors’ statement that they consider that the
annual report and financial statements taken as a
whole is fair, balanced and understandable, and
provides the information necessary for shareholders to
assess the Group’s position and performance,
business model and strategy;
the section of the annual report describing the work of
the Audit Committee, including the significant issues
that the audit committee considered in relation to the
financial statements, and how these issues were
addressed; and
We are required to review the part of the Corporate
Governance Report relating to the Group’s compliance with
the provisions of the UK Corporate Governance Code
specified by the Listing Rules for our review. We have
nothing to report in this respect.
8. We have nothing to report on the other matters
on which we are required to report by exception
Under the Companies Act 2006, we are required to report
to you if, in our opinion:
–
–
–
–
adequate accounting records have not been kept by
the parent Company, or returns adequate for our audit
have not been received from branches not visited by
us; or
the parent Company financial statements and the part
of the Directors’ Remuneration Report to be audited
are not in agreement with the accounting records and
returns; or
certain disclosures of directors’ remuneration specified
by law are not made; or
we have not received all the information and
explanations we require for our audit.
We have nothing to report in these respects.
9. Respective responsibilities
Directors’ responsibilities
As explained more fully in their statement set out on page
198, the directors are responsible for: the preparation of
the financial statements including being satisfied that they
give a true and fair view; 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; assessing the
Group and parent 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 they either intend to liquidate the Group or the
parent Company or to cease operations, or have no
realistic alternative but to do so.
Auditor’s responsibilities
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 our opinion in an auditor’s report. Reasonable
assurance is a high level of assurance, but does not
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 aggregate, they
could reasonably be expected to influence the economic
208
209
Independent auditor's reportto the members of Redrow plc Financial statements
CO N SO LI DATE D I N CO M E S TATE M E NT
BA L A N C E S H E E TS
52 WEEKS ENDED 2 JULY 2023/53 WEEKS ENDED 3 JULY 2022
Revenue
Cost of sales
Gross profit
Administrative expenses
Operating profit
Financial income
Financial costs
Net financing costs
Profit before tax
Income tax expense
Profit for the year
Earnings per share – basic
– diluted
2022
PRE-
EXCEPTIONAL
ITEM
£M
2022
EXCEPTIONAL
ITEM
£M
2,140
(1,624)
516
(102)
414
2
(6)
(4)
410
(82)
328
–
(164)
(164)
–
(164)
–
–
–
(164)
33
(131)
2023
TOTAL
£M
2,127
(1,619)
508
(109)
399
5
(9)
(4)
395
(97)
298
91.2p
90.9p
96.0p
95.8p
2022
TOTAL
£M
2,140
(1,788)
352
(102)
250
2
(6)
(4)
246
(49)
197
57.7p
57.5p
NOTE
2
2
2
3
3
4
6
6
S TATE M E NT O F CO M PR E H E N S I V E I N CO M E
G RO U P
CO M PA N Y
2022
PRE-
EXCEPTIONAL
ITEM
£M
2022
EXCEPTIONAL
ITEM
£M
328
(131)
2023
TOTAL
£M
298
2022
TOTAL
£M
197
2023
TOTAL
£M
550
2022
TOTAL
£M
–
52 WEEKS ENDED 2 JULY 2023/
53 WEEKS ENDED 3 JULY 2022
Profit for the year
Other comprehensive
(expense)/income
Items that will not be
reclassified to profit or loss
Remeasurements of post
employment benefit
obligations
NOTE
7e
Deferred tax on remeasurements
of post employment benefit obligations
Other comprehensive
expense for the year net of tax
Total comprehensive income/
(expense) for the year
(34)
12
(22)
(1)
–
(1)
–
–
–
(1)
–
(1)
19
276
327
(131)
196
(34)
8
(26)
524
(1)
–
(1)
(1)
The accompanying notes form an integral part of the financial statements.
Assets
Intangible assets
Property, plant and equipment
Lease right of use assets
Investments
Deferred tax assets
Retirement benefit surplus
Trade and other receivables
Total non-current assets
Inventories
Trade and other receivables
Current corporation tax
Cash and cash equivalents
Total current assets
Total assets
Equity
Retained earnings 4 July 2022/28 June 2021
Profit for the year
Other comprehensive expense for the year
Dividend paid
Net purchase of own shares arising from share buyback
programme
Movement due to equity based share options and
owned shares held by EBT
Retained earnings at 2 July 2023/3 July 2022
Share capital
Share premium account
Other reserves
Total equity
Liabilities
Trade and other payables
Deferred tax liabilities
Long-term provisions
Total non-current liabilities
Trade and other payables
Current income tax liabilities
Provisions
Total current liabilities
Total liabilities
Total equity and liabilities
NOTE
8
9
10
11
12
7e
13
14
13
15f
5
18
19
18
19
19
16
12
17
16
17
G RO U P
CO M PA N Y
AS AT
2 JULY
2023
£M
AS AT
3 JULY
2022
£M
AS AT
2 JULY
2023
£M
AS AT
3 JULY
2022
£M
1
22
10
–
1
5
–
39
2,770
42
–
235
3,047
3,086
1,846
298
(22)
(108)
(100)
8
1,922
35
59
10
1
20
5
–
1
39
–
66
2,740
76
7
288
3,111
3,177
1,768
197
(1)
(100)
–
(18)
1,846
37
59
8
–
–
–
–
–
5
860
865
–
117
2
238
357
1,222
781
550
(26)
(108)
(100)
6
1,103
35
59
9
2,026
1,950
1,206
104
3
88
195
750
8
107
865
1,060
3,086
91
15
110
216
914
–
97
1,011
1,227
3,177
–
2
–
2
14
–
–
14
16
–
–
–
–
–
39
266
305
–
317
1
285
603
908
878
–
(1)
(100)
–
4
781
37
59
7
884
–
10
–
10
14
–
–
14
24
The financial statements on pages 210 to 249 were approved by the Board of Directors on 15 September 2023 and were
signed on its behalf by:
RICHARD AKERS
Director
BARBARA RICHMOND
Director
Redrow plc Registered Number 2877315
1,222
908
210
211
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statements
S TATE M E NT O F C H A N G E S I N EQ U IT Y
S TATE M E NT O F C A S H FLOWS
59
10
1,922
2,026
Interest paid
Tax paid
T H E G R O U P
Total equity at 27 June 2021
Profit for the year
Other comprehensive income for the year
Total comprehensive income relating to the year (net)
Dividends paid – distributions to owners
Net purchase of own shares to satisfy share options
Other LTIP/DB/SAYE credit
Total equity at 3 July 2022
Profit for the year
Other comprehensive expense for the year
Total comprehensive income relating to the year (net)
Dividends paid – distributions to owners
Net purchase of own shares arising from share buyback
programme
Satisfaction of share options from treasury shares
Other LTIP/DB/SAYE credit
Total equity at 2 July 2023
T H E C O M PA N Y
Total equity at 27 June 2021
Profit for the year
Other comprehensive income for the year
Total comprehensive income relating to the year (net)
Dividends paid – distributions to owners
Other LTIP/DB/SAYE credit
Total equity at 3 July 2022
Profit for the year
Other comprehensive expense for the year
Total comprehensive expense relating to the year (net)
Dividends paid – distributions to owners
Net purchase of own shares arising from share buyback
programme
Other LTIP/DB/SAYE credit
Total equity at 2 July 2023
NOTE
5, 19
19
5, 19
18
19
NOTE
5, 19
19
5, 19
18
19
SHARE
CAPITAL
£M
SHARE
PREMIUM
ACCOUNT
£M
37
59
OTHER
RESERVES
£M
RETAINED
EARNINGS
£M
TOTAL
£M
8
–
–
–
–
–
–
8
–
–
–
–
2
–
–
1,768
1,872
197
(1)
196
(100)
(22)
4
197
(1)
196
(100)
(22)
4
1,846
1,950
298
(22)
276
(108)
298
(22)
276
(108)
(100)
(100)
2
6
2
6
–
–
–
–
–
–
59
–
–
–
–
–
–
–
–
–
–
–
–
–
37
–
–
–
–
(2)
–
–
35
SHARE
CAPITAL
£M
SHARE
PREMIUM
ACCOUNT
£M
37
59
–
–
–
–
–
37
–
–
–
–
(2)
–
35
–
–
–
–
–
59
–
–
–
–
–
–
59
OTHER
RESERVES
£M
RETAINED
EARNINGS
£M
TOTAL
£M
7
–
–
–
–
–
7
–
–
–
–
2
–
9
878
981
–
(1)
(1)
–
(1)
(1)
(100)
(100)
4
781
550
(26)
524
(108)
4
884
550
(26)
524
(108)
(100)
(100)
6
6
1,103
1,206
The above items are presented net of tax where appropriate. See note 4 and note 12 for information on income tax and
deferred tax expense. As permitted by Section 408 of the Companies Act 2006, the Income Statement of Redrow plc is
not presented as a part of these financial statements. The consolidated profit on ordinary activities after taxation for the
financial year, excluding intra-Group dividends, is made up as follows:
Holding company
Subsidiary companies
2023
£M
–
298
298
2022
£M
–
197
197
G RO U P
CO M PA N Y
52 WEEKS
ENDED
2 JULY
2023
£M
53 WEEKS
ENDED
3 JULY
2022
£M
52 WEEKS
ENDED
2 JULY
2023
£M
53 WEEKS
ENDED
3 JULY
2022
£M
NOTE
Cash flows from operating activities
Profit for the year
Depreciation and amortisation
Dividend from subsidiary undertakings
5
Financial income
Financial costs
Income tax expense
Adjustment for non-cash items
Decrease in trade and other receivables
Increase in inventories
(Decrease)/increase in trade and other payables
(Decrease)/increase in provisions
Cash inflow/(outflow) generated from operations
Net cash inflow/(outflow) from operating activities
Cash flows from investing activities
Acquisition of software, property, plant and equipment
Advances and loans repaid by subsidiary undertakings
Interest received
Receipts from joint ventures
Net cash (outflow)/inflow from investing activities
Cash flows from financing activities
Payment of lease liabilities
Purchase of own shares
Dividend paid
5
Net cash (outflow) from financing activities
(Decrease)/increase in net cash and cash equivalents
Net cash and cash equivalents at the beginning of
the year
Net cash and cash equivalents at the end of the year
20
The accompanying notes form an integral part of the financial statements.
298
197
4
–
(5)
9
97
–
34
(30)
(151)
(12)
244
(4)
(82)
158
(4)
–
4
–
–
(3)
(100)
(108)
(211)
(53)
288
235
5
–
(2)
6
49
7
24
(227)
86
173
318
(2)
(55)
261
(4)
–
1
–
(3)
(3)
(27)
(100)
(130)
128
160
288
550
–
(550)
(6)
2
–
–
–
–
1
–
(3)
(2)
–
(5)
–
160
6
–
166
–
(100)
(108)
(208)
(47)
285
238
–
–
–
(4)
2
–
–
–
–
2
–
–
(2)
–
(2)
–
239
4
–
243
–
–
(100)
(100)
141
144
285
212
The accompanying notes form an integral part of the financial statements.
213
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statementsFinancial statements
Accounting policies
ACCOU NTI N G P O LI C I E S
B A S I S O F P R E PA R AT I O N
The Group financial statements were prepared in
accordance with UK-adopted international accounting
standards (IFRS) and applicable law. The Parent Company's
financial statements have been prepared in accordance
with UK-adopted international accounting standards (IFRS)
and applied in accordance with the provisions of the
Companies Act 2006 and applicable law. The financial
statements have been prepared in accordance with the
historical cost convention as modified by the revaluation of
derivative financial instruments.
The preparation of financial statements in conformity with
IFRS requires the use of estimates and assumptions that
affect the reported amounts of assets and liabilities at the
balance sheet date and the reported amounts of revenue
and expenses during the reporting period. Whilst these
estimates are based on management’s best knowledge of
the amount, event or actions, actual results ultimately may
differ from those estimates (refer to note 1).
Redrow plc is a public listed company, listed on the London
Stock Exchange and domiciled in the UK.
G O I N G C O N C E R N B A S I S O F P R E PA R AT I O N
The financial statements have been prepared on a going
concern basis which the Directors consider to be
appropriate for the reasons outlined below.
The Group has a £350m Revolving Credit Facility (RCF)
(2022: £350m) provided by an established syndicate of six
banks being Barclays Bank PLC, Lloyds Bank Plc, The Royal
Bank of Scotland Group Plc, Santander, HSBC and Svenska.
This expires on 30 September 2025 (2022: 30 September
2025) and is a committed unsecured facility. As at 15
September 2023, £350m of this facility was undrawn. It is
likely that the RCF will be renewed prior to its expiry in
September 2025.
In addition the Group is in a net cash position at 2 July
2023 of £225m (see note 20) and also has £3m of
unsecured, uncommitted facilities.
The Directors have prepared forecasts including cashflow
forecasts for a period of at least 12 months from the date of
signing of these financial statements (the going concern
assessment period). These forecasts incorporate
assumptions about the timing of legal completions of new
homes and land purchases, build cost inflation, interest
rates, profitability and working capital requirements. These
forecasts indicate that the Group will have sufficient funds
to meet its liabilities as they fall due, taking into account
the following severe but plausible downside assumptions:
• A 10% price reduction on all unexchanged private and
social legal completions for the going concern
assessment period compared to the base case Board
approved budgeted prices;
• A 30% volume reduction for the going concern
assessment period compared to the base case Board
approved budgeted volumes;
• In addition to the build cost inflation incorporated within
the base case Board approved budgeted costs, an
additional 3% build cost inflation has been applied to all
build costs from Q1 FY24 falling to 2% from Q1 FY25; and
• The Bank of England base rate increasing to 6% during
FY24 before reducing to 5.5% by the end of the going
concern assessment period.
Mitigations to this sensitivity analysis include a reduction in
land investment and development and a reduction in
dividends to align with the Company dividend payout ratio
policy.
These downside assumptions reflect the further potential
impact of the uncertain economic and housing market
conditions, cost of living pressures, the impact on
consumer confidence levels, the continuing war in Ukraine
and disruption in the energy and fuel market.
Allowing for the above downside scenario, the model
shows the Group has adequate levels of liquidity from its
committed facilities and compiles with all its banking
covenants throughout the going concern assessment
period. The Directors therefore consider that the Group
has adequate resources in place for the going concern
assessment period and have therefore adopted the going
concern basis of accounting in preparing these financial
statements.
P R I N C I PA L AC C O U N T I N G P O LI C I E S
The principal accounting policies have been applied
consistently.
The principal accounting policies are outlined below:
I M PAC T O F N E W S TA N DA R D S A N D
I N T E R P R E TAT I O N S
a) The following standards have been issued but have
not been applied by the Group in these financial
statements. These amendments to standards and
interpretations had no significant impact on the financial
statements:
• Amendments IAS 16 ‘Property, Plant and Equipment’
• Amendments to IAS 37 ‘Onerous Contracts ‘
• Annual Improvements to IFRS Standards 2018 – 2020
• Amendments to IFRS 3 ‘Reference to the Conceptual
Framework’
b) The following new standards and amendments to
standards have been issued but are not effective for the
financial year beginning 4 July 2022 and have not been
early adopted:
• Amendments to IAS 1 ‘Classification of Liabilities as
Current or Non-current’
• Definition of Accounting Estimates (Amendments to
IAS 8)
214
• Amendments to IAS 1 ‘Presentation of Financial
Statements’ and IFRS Practice Statement 2 Making
Materiality Judgements
• Amendments to IAS 12 'Income Taxes' – deferred tax
related to assets and liabilities arising from a single
transaction
• IFRS 17 'Insurance Contracts'
Management is in the process of assessing the impact of
IFRS 17 in relation to performance bonds provided and
cross guarantees provided for the Group entities and
expect no significant impact on the Financial Statements.
The new standards and amendments to the standards
noted above are expected to have no significant impact on
the financial statements.
B A S I S O F C O N S O L I DAT I O N
The consolidated financial statements incorporate the
financial statements of Redrow plc and all its subsidiaries,
together with the Group’s share of the results and share of
net assets of jointly controlled entities i.e. the financial
statements of Redrow plc and entities controlled by
Redrow plc (and its subsidiaries). Control is achieved where
Redrow plc:
• has the power over the investee;
• is exposed or has rights, to variable returns from its
involvement with the investee; and
• has its ability to use its power to affect its returns.
Redrow plc’s accounting reference date is 30 June.
Consistent with the normal monthly reporting process, the
actual date to which the balance sheet has been drawn up
is 2 July 2023 being a 52 week year (2022: 3 July 2022
being a 53 week year).
The Group has taken advantage of the exemption provided
under Section 408 of the Companies Act 2006 not to
present Redrow plc’s Company income statement. The
profit for the financial year is dealt with in the statement of
changes in equity.
a. Subsidiaries
Subsidiaries are all entities over which the Group has
control. The Group controls an entity when the Group is
exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect
those returns through its power over the entity.
Subsidiaries are fully consolidated from the date on which
control is transferred to the Group. They are
deconsolidated from the date that control ceases.
Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured
at their fair value at the date of acquisition. Any excess of
the cost of acquisition over the fair value of the Group’s
share of the identifiable net assets represents goodwill.
Goodwill is subject to an annual impairment review, with
any reduction in value being taken straight to the income
statement. Adjustments are made as necessary to the
financial statements of subsidiaries to ensure consistency
with the policies adopted by the Group.
All inter-company transactions and balances between
Group companies are eliminated on consolidation.
b. Interests in joint ventures
Whilst the Group has no current joint ventures the Group
applies IFRS 11 to all joint arrangements. Under IFRS 11
investments in joint arrangements are classified as either
joint operations or joint ventures depending on the
contractual rights and obligations of each investor. Redrow
plc has assessed the nature of its joint arrangements and
determined them to be joint ventures. Joint ventures are
accounted for using the equity method.
Under the equity method of accounting, interests in joint
ventures are initially recognised at cost and adjusted
thereafter to recognise the Group’s share of the post-
acquisition profits or losses and movements in other
comprehensive income. When the Group’s share of losses
in a joint venture equals or exceeds its interests in the joint
ventures, the Group does not recognise further losses,
unless it has incurred obligations or made payments on
behalf of the joint ventures.
Unrealised gains on transactions between the Group and
its joint ventures are eliminated to the extent of the Group’s
interest in the joint ventures. Unrealised losses are also
eliminated unless the transaction provides evidence of an
impairment of the asset transferred.
R E V E N U E A N D P R O F I T R E C O G N I T I O N
Revenue represents the fair value received and receivable
in respect of the sale of residential housing and land and of
commercial land and developments net of value added tax
and cash incentives. This is recognised on the transfer of
control to the customer on legal completion i.e. at a point in
time for the vast majority of sales.
Profit is recognised on legal completion.
In respect of social housing, the Group enters into
contracts for the sale of social housing either at an agreed
price or at a discount to open market value. Payment for
these properties is made by the purchaser, either on legal
completion of the unit or, in certain circumstances on a
staged basis.
For those social or private rental sector contracts where
payment is received on a staged basis, the Group
considers these on a contract by contract basis and
determines the appropriate revenue recognition based on
the particular terms of that contract. The Group recognises
revenue on legal completion i.e. at a point in time for such
contracts where the Group retains effective control of the
land asset until legal completion. The Group recognises
revenue over time for the construction element of such
contracts rather than at legal completion in circumstances
in which effective control of the underlying land is
transferred to the social or private rental sector provider
before or during construction. This is because effective
control of the land asset has passed to the customer and
subsequent construction activity is adding value to the
A
c
c
o
u
n
t
i
n
g
p
o
l
i
i
c
e
s
215
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statementsFinancial statements
Accounting policies / continued
land asset controlled by the customer. For such contracts,
revenue for the construction element is recognised by
reference to the degree of completion of contract activity
at the balance sheet date based on the percentage of build
completion of each unit multiplied by the build contract
cost of the unit as reviewed by Quantity Surveyors.
Revenue for the sale of the land element of such contracts
is recognised at the point in time when control of the land
is transferred to the customer.
PA R T E XC H A N G E P R O P E R T I E S
Part exchange is consistently a de minimis proportion of
our business. It is incidental to our main operation and
hence this is shown on a net expense basis within cost of
sales.
S E G M E N TA L R E P O R T I N G
The main operation of the Group is focused on
housebuilding.
The Executive Management Team (who are the Chief
Operating Decision Maker as defined in IFRS 8 ‘Operating
Segments’) regularly reviews the Group’s performance and
balance sheet position at both a consolidated and
divisional level. Each division is an operating segment as
defined by IFRS 8 in that the Executive Management Team
evaluates performance and allocates resources at this
level.
All the divisions have been aggregated into one reporting
segment on the basis that they all operate entirely within
the United Kingdom and share similar economic
characteristics including:
• sales demand subject to the same macro economic
factors e.g. mortgage availability and Government policy;
• debt is raised centrally and the cost of capital is the
same at each division; and
• national supply agreements for key inputs such as
materials are negotiated centrally and in place across the
Group.
Within the Financial Review, the Group has provided
information on land holdings (page 86) and homes revenue
proportions (page 84) by geographical area being North,
Central, South and Greater London. The Executive
Management Team do not consider these to be separate
reportable segments because, as stated above, they
review the whole operations at a consolidated and
divisional level when assessing performance and allocating
resources.
E XC E P T I O N A L I T E M S
Exceptional items are those which in the opinion of the
Board, are material by size or nature, non-recurring,
outside the normal course of business and of such
significance that they require separate disclosure.
N E T F I N A N C I N G C O S T S
Interest income is recognised on a time apportioned basis
by reference to the principal outstanding and the effective
interest rate. Interest costs are recognised in the income
statement on an accruals basis in the period in which they
are incurred.
I N C O M E A N D D E F E R R E D TA X
Income tax comprises current tax and deferred tax.
Current tax is based on taxable profits for the year and any
appropriate adjustment to tax payable in respect of prior
years. Taxable profit differs from profit before tax as shown
in the income statement as it excludes income or
expenditure items which are never chargeable or allowable
for tax or which are chargeable or deductible in other
accounting periods. Current tax from 1 April 2023 includes
Residential Property Developer Tax following its
introduction by HMRC.
Deferred tax is provided in full, using the balance sheet
liability method, on temporary differences arising between
the carrying amounts of assets and liabilities in the
consolidated financial statements and the corresponding
tax bases used in the calculation of taxable profit.
Deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which
deductible temporary differences can be utilised. Deferred
tax liabilities are recognised for all temporary differences.
Deferred tax is calculated at the rates substantively
enacted at the balance sheet date.
Deferred tax is credited or charged in the income
statement, consolidated statement of comprehensive
income, or retained earnings as appropriate.
S O F T WA R E A S A S E R V I C E ( S a aS )
Implementation costs including costs to configure or
customise a cloud provider's application software are
recognised as administrative expenses when the services
are received.
I N TA N G I B LE A S S E T S – C O M P U T E R S O F T WA R E
( N O N S a aS S O F T WA R E )
Acquired computer software licences are capitalised on
the basis of costs incurred to bring to use the specific
software and are amortised over their estimated useful
lives of three years, charged to administrative expenses.
These are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying values
may not be recoverable.
P R O P E R T Y, P L A N T A N D E Q U I P M E N T
Freehold property comprises offices or other buildings
held for administrative purposes. Freehold property is
216
shown at cost less the subsequent depreciation of
buildings.
All other property, plant and equipment is stated at historic
cost less depreciation. Historic cost includes any costs
directly attributable to bringing the assets to the location
and condition necessary for them to be capable of
operating in the manner intended by management.
Land is not depreciated. Depreciation on other assets is
charged so as to write off the cost of assets to their
residual values over their estimated useful lives, on a
straight line basis as follows:
Buildings within freehold property
Plant and machinery
Fixtures and fittings
50 years
5 – 10 years
3 – 5 years
liability is measured by increasing the carrying amount to
reflect interest on the lease liability, and reducing it by the
lease payments made. The lease liability is remeasured
when the Group changes its assessment of whether it will
exercise an extension or termination option.
The Group has elected not to recognise right-of-use assets
and lease liabilities for short-term leases that have a lease
term of 12 months or less and leases of low value assets.
The Group recognises the lease payments associated with
these leases as an expense on a straight-line basis over
the lease term.
The Company presents right-of-use assets separately as
‘Lease right of use assets’ and lease liabilities as ‘Trade
and other payables’ in the statement of financial position.
The assets’ useful lives are reviewed and adjusted if
appropriate at each balance sheet date.
These are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying values
may not be recoverable.
The gain or loss arising on the disposal of an asset
represents the difference between the sales proceeds and
the carrying amount of the asset and is recognised in the
income statement.
I N V E S T M E N T I N S U B S I D I A RY C O M PA N I E S
In the parent company books, the investment in its
subsidiaries is held at cost less any impairment.
L E A S E S
At the inception of a contract, the Group assesses whether
a contract is, or contains, a lease.
The Group recognises a right-of-use asset and a lease
liability at the lease commencement date. The right-of-use
asset is initially measured at cost, which comprises the
initial amount of the lease liability adjusted for any lease
payments made at or before the commencement date, plus
any initial direct costs incurred less any lease incentives
received.
The right-of-use asset is subsequently depreciated using
the straight-line method from the commencement date to
the end of the lease term.
The lease liability is initially measured at the present value
of the lease payments that are not paid at the
commencement date, discounted using the interest rate
implicit in the lease or, if that rate cannot be readily
determined, the Group’s weighted average incremental
borrowing rate. The lease term comprises the non-
cancellable period of the contract, together with periods
covered by an option to extend the lease where the Group
is reasonably certain to exercise that option. The lease
I N V E N TO R I E S
Inventories (excluding land) are at standard cost. Abnormal
costs are expensed to cost of sales as incurred. The
standard costs are set for each phase at the outset of that
phase.
Cost comprises land and associated acquisition costs,
direct materials and subcontract work, other direct costs
and those overheads (based on normal operating capacity)
that have been incurred in bringing the inventories to their
present location and condition. These include
infrastructure and development costs such as roads and
sewers, including contributions to other community
benefits such as schools, medical centres and community
centres. Inventories (excluding land) are at standard cost.
Land includes refundable land contract exchange deposits.
Total land costs are allocated to the private housing on a
development as, in the case of amenity land and social
housing land, neither has sufficient contribution from sales
of the precise area of the land to cover the land costs and
are a planning requirement of the development.
Provisions are established to write down land where the
estimated net sales proceeds less costs to complete are
less than the current carrying value. Adjustments to the
provisions will be required where selling prices or costs to
complete change.
Net realisable value for land was assessed by estimating
selling prices and cost (including sales and marketing
expenses), taking into account current market conditions,
considering the planning status in respect of undeveloped
land and environmental factors likely to impact these in the
relevant time horizon.
This net realisable value provision will be closely monitored
for adequacy and appropriateness as regards under and
over provision to reflect circumstances at future balance
sheet dates. Any material change to the underlying
provision will be reflected through cost of sales.
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Accounting policies / continued
F O R WA R D L A N D
The Group enters into a number of arrangements for the
purchase of land. Where such arrangements are conditional
on a future event the Group recognises option fees and
other relevant initial costs as they fall due, which are
included initially in inventory and subject to regular
impairment analysis, but does not recognise the full cost of
the land until the option to purchase the land has been
executed. Where the Group enters into an unconditional
contract on deferred payment terms the land purchased is
recognised at contract inception together with a related
liability, discounted at an appropriate rate. The related land
creditors are shown as due within or after one year in line
with the contractual payment terms, as the Directors
believe this information is important in assessing the
Group’s liquidity and timing of future cash flows and debt
profile. In line with industry practice in the cash flow
statement the settlement of land creditors is shown as an
operating cash flow as the Directors believe the financing
of land purchases is integral to the Group’s management of
working capital.
E M P LOY E E B E N E F I T S
a. Pension obligation
The Group operates two pension schemes for its staff. The
Redrow Staff Pension Scheme (the ‘Scheme’) closed to the
accrual of new benefits with effect from 1 March 2012, with
new benefits now being provided via the Redrow Group
Personal Pension Plan (the ‘GPP’). The Scheme is externally
invested and comprises two sections: a defined benefit
section and a defined contribution section. A defined
benefit plan is a pension plan which defines an amount of
pension benefit that an employee will receive on
retirement. It is funded through payments to trustee
administered funds, determined by actuarial valuations
carried out on at least a triennial basis. A defined
contribution plan is a pension plan under which the Group
pays agreed contributions into a separate fund for each
employee and any subsequent pension payable to a
specific employee is determined by the amount
accumulated in their individual fund. The GPP is also a type
of defined contribution plan.
The (liability)/asset recognised in the balance sheet in
respect of the defined benefit section of the scheme is the
present value of the defined benefit obligation at the
balance sheet date, less the value of plan assets. Plan
assets include insured annuities with matching benefits
which are valued on the basis of corresponding DBO. In
January 2023, the Trustees of the Scheme entered into a
bulk insurance policy with Standard Life covering the
benefit entitlements of all pensioner and non-pensioner
Scheme members (who were not already insured under a
separate policy) prior to GMP equalisation. The asset value
attributed to this policy for IAS19 purposes has been set
equal to the defined benefit obligation of the members
covered under the policy excluding the allowance for GMP
equalisation. The remaining invested scheme assets have
been taken at their fair value (see note 7e). The defined
benefit obligation is determined using the projected unit
credit method on an annual basis by an independent
scheme actuary.
Actuarial gains and losses arising from experience
adjustments, changes in actuarial assumptions and actual/
expected return on plan assets are charged or credited to
equity as they arise in full via the statement of
comprehensive income. Any surplus from the Scheme will
be recognised only if there are any future economic
benefits available either in the form of a refund or reduction
in future contributions.
Scheme service costs are charged to cost of sales and
administrative expenses as appropriate and scheme
finance costs are included in net financing costs. Past
service credits are recognised immediately in income.
In respect of the defined contribution section of the
Scheme and the GPP, contributions are recognised as an
employee benefit expense when they are due. The Group
has no further payment obligations in respect of the above
once the contributions have been paid.
b. Bonus plans
The Group recognises a liability and an expense for
bonuses where contractually obliged.
c. Share-based payments
Equity settled share-based payments are measured at fair
value on the date of grant and expensed on a straight line
basis over the vesting period, based on the Group’s
estimate of shares that will eventually vest, having
reassessed any appropriate service and non-market
performance conditions. Market based performance
conditions are valued using a stochastic model. The charge
to the income statement is recognised in administrative
expenses and the credit to the retained earnings via the
Statement of Changes in Equity.
F I N A N C I A L I N S T R U M E N T S
a. Land creditors
Deferred payments arising from land creditors are held at
discounted present value using the effective interest
method, in accordance with IFRS 9. The difference between
the fair value and the nominal value is amortised over the
deferment period via financing costs.
The interest rate applied is an equivalent loan rate available
on the date of the land purchase.
Deferred payments arising from land creditors are
considered as financing rather than operational in nature.
However, in line with industry practice, the Group treats
cash paid in respect of land, including land creditors, as
operating rather than financing cashflows.
218
b. Derivative financial instruments and hedge accounting
Derivative financial instruments are initially recorded at fair
value and the fair value is remeasured to fair value at each
reporting date.
The Group’s use of financial derivatives is governed by an
interest rate risk management framework adopted by the
Board which sets parameters to ensure an appropriate
level of hedging is maintained to manage interest rate risk
in respect of borrowings.
The policy prohibits any trading in derivative financial
instruments or their use for speculative purposes.
The effective portion of changes in the fair value of
derivative financial instruments which are designated and
which qualify as cash flow hedges are recognised directly
in equity in a hedge reserve. The gains or losses relating to
the ineffective portion are recognised in the income
statement immediately they arise.
c. Loans and receivables
Loans and receivables are non-derivative financial assets
with fixed or determinable payments that are not quoted in
an active market. They are included in current assets,
where considered to be receivable within the Group’s
normal operating cycle of c4 years after the balance sheet
date; otherwise they are classified as non-current assets.
Loans and receivables include ‘trade receivables’ and
‘other receivables’ in the balance sheet.
until legal completion of the related properties when
revenue is recognised.
Deposits received in advance are typically held for a
period of up to 18 months before the associated
performance obligations are satisfied and the revenue is
recognised.
P R OV I S I O N S
Provisions are recognised when the Group has a pursuant
legal or constructive obligation as a result of a past event,
and it is probable that the Group may be required to settle
that obligation. Provisions are measured at the Directors’
best estimate of the expenditure required to settle the
obligation at the balance sheet date and are discounted to
present value where the effect is material.
O N E R O U S C O N T R AC T S
Onerous contracts are contracts in which the unavoidable
costs in meeting the obligations under the contract exceed
the economic benefits expected to be received under it.
Provision is made to reflect management’s best current
estimate of the least net cost of either fulfilling or exiting
the contract.
S H A R E C A P I TA L
Ordinary shares are classed as equity.
D I V I D E N D D I S T R I B U T I O N
Trade receivables are held at discounted present value
less any impairment. The amount is then increased to
settlement value over the settlement period via financing
income.
Dividend distribution to the Company’s shareholders is
recognised as a liability in the Group’s financial statements
at the point at which there is a legal obligation to make a
distribution to shareholders.
d. Cash and cash equivalents
Cash and cash equivalents comprise cash balances and
call deposits. Bank overdrafts that are repayable on
demand, forming an integral part of the Group’s cash
management are included as a component of cash and
cash equivalents for the purpose of the statement of
cash flows.
e. Borrowings and trade payables
Interest bearing borrowings and trade payables are
recorded when the proceeds are received, net of
transaction costs incurred and subsequently at amortised
cost. Any difference between the proceeds, net of
transaction costs and the redemption value is recognised
in the income statement over the period of the borrowings.
f. Deposits and payments on account
New property deposits from private customers are held
within Trade and Other payables until the legal completion
of the related property when revenue is recognised or the
rescission of the sale contract.
Payments on account from social and private rented sector
(PRS) customers are held within Trade and Other payables
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Notes to the financial statements
N OTES TO TH E FI N A N C I A L S TATE M E NTS
1 . C R ITI C A L ACCO U NTI N G J U D G E M E NT S A N D K E Y S O U RC E S O F E S TI M ATI O N U N C E R TA I NT Y
1 . C R ITI C A L ACCO U NTI N G J U D G E M E NT S A N D K E Y S O U RC E S O F E S TI M ATI O N U N C E R TA I NT Y C O N T I N U E D
Judgements and estimates are continually evaluated and are based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances. Management consider the
critical judgements and key sources of estimation uncertainty relate to:
Carrying value of inventories and cost of sales recognition
The Group carries inventories at the lower of cost and net realisable value. Cost of sales and inventory (excluding land) is
recognised at a site or phase specific standard cost and any abnormal costs are expensed to cost of sales as incurred.
The standard cost is based on a detailed budget for the site or phase with specific allocation of budgeted costs to an
individual unit.
Due to the nature of development timescales, the standard cost is affected by a variety of uncertainties such as
inflationary cost pressures, build delays and unforeseen build issues. Judgement is needed to allocate build variances
between 'abnormal costs' and 'standard cost'. Abnormal costs include, but are not limited to, costs to rectifying
contaminated land, redesign works and change of contractor due to quality issues or administration. The level of
judgement required is increased during periods of volatility. The current year total build variances of c£100m are
significantly higher than prior periods due to the unique combination of current macro-economic conditions leading to
extended development timescales in response to a fall in demand from Q4 calendar 2022, combined with high levels of
build cost inflation due to fulfilling a record opening orderbook as a result of as a strong upsurge in demand post
pandemic. As a result, a full review has been carried out by the Group to analyse the build cost variances to update the
standard cost of work in progress to approximate actual costs.
Legacy fire safety provision
The Group holds a provision of £188m (2022: £200m) in respect of legacy fire safety remediation. As outlined in the 2022
Annual Report, in April 2022 the Group signed the Government’s Building Safety Pledge in respect of funding of
remediation of life critical fire safety issues on buildings over 11m in which the Group was involved in going back 30 years.
On 30 January 2023 Michael Gove announced the publishing of the self remediation terms (SRT) which follows on from
the signing of the Building Safety Pledge last year. Redrow signed this SRT on 13 March 2023 and the Welsh version on
18 April 2023. This SRT widened developers’ responsibilities regarding potential remediation work which may need to be
undertaken notably to include communal internal areas and for all buildings over 11m to be risk assessed regardless of
EWS1 (External Wall Fire Review) status.
The legacy fire safety provision reflects management’s best estimates of the cost of works outstanding to complete the
remediation of all identified buildings within scope to the standard outlined in the SRT including the reimbursement of
funds to the Build Safety Fund (BSF) as appropriate. Prior year provisions represented Management’s best estimate of
the liability based on the information available at the time in relation to the obligations at the time. In estimating the cost
of the works for calculating the provision at 2 July 2023, Management has used the latest BSF cost information shared
with Redrow, taken into account the cost of contracts Redrow has placed and tenders received together with input from
external cost consultants with respect to estimated external and internal remediation cost per plot. Management
classified buildings as in scope according to a risk assessment across 6 risk categories used in reporting to DLUHC
including their ESW1 status.
These estimates are inherently uncertain as:
• this is a highly complex area involving bespoke buildings for which investigations and assessments will be ongoing for
some time;
• whilst c50% of the provision is based on claims notified by the BSF or insurers and contracts placed by Redrow, actual
costs may differ as works progress;
• the remaining properties have a higher degree of estimation uncertainty as our assessments, remediation strategies
and tenders are at a more preliminary stage and the contingencies included in this element of the provision reflect the
increased uncertainty over the nature and cost of the remediation required; and
• it is not possible to establish the extent of internal area fire safety works without an intrusive survey of each building
and whilst external expert cost estimates were used, these may change as more information becomes available.
The main movements in the provision estimates compared to last year reflect confirmation of EWS1 status in respect of a
number of properties reducing the risk categorisation of those buildings and therefore the cost estimate for external fire
safety works (as no external remediation cost allowance has been made for those properties with a satisfactory ESW1)
and the obligation in the SRT in respect of internal communal areas which extended the scope of Redrow’s obligations
and required the inclusion of cost estimates for such works in the provision.
Given the high degree of complexity and uncertainty, it is possible that these estimates, based on the SRT, will change
over time as more accurate cost information is obtained and as the leaseholders or ourselves have any success in
recovering costs incurred by Redrow from other third parties. No recovery is currently assumed. If possible costs
(excluding known BSF costs) were underestimated or overestimated by 10% then the profit before tax in the period would
reduce or increase respectively by c£13m, c3%.
220
Net realisable value of inventories
This is not considered to have significant estimation uncertainty but has been included as it is a complex estimate. A full
review of the net realisable value of inventories was undertaken by the Group as at 2 July 2023, including a review of
land owned without a residential planning consent, and this requires Management to use its judgement and experience
in assessing any impairment provisions that may be required taking into account for example movement in house prices,
development costs, impact of climate change and regulatory change. If there are significant movements in UK house
prices or development costs or planning regulation or expectation compared to Management expectations then further
impairments or reversal of impairments already made may be needed in future period.
Pensions
This is not considered to have significant estimation uncertainty based on sensitivities as the Trustees of the Scheme
have entered into a buy-in transaction with matching benefits and under IAS19 value of the annuity policy is equal to
DBO but has been included as it is a complex estimate.
The Group has utilised assumptions including price inflation rate, mortality assumptions and a discount rate having been
advised by its actuary. To the extent that such assumed rates are different from what actually transpires, the retirement
benefit obligations of the Group would change. A sensitivity analysis is included on page 232.
The primary risks the Group is exposed to by the defined benefit pension scheme are the movement in corporate bond
yields, the market’s long-term expectations for inflation and movement in mortality rates. The scheme closed to future
accrual with effect from 1 March 2012. See Note 7e.
Judgements in relation to certain disclosures
As noted in the accounting policy, in line with industry practice, the Group treats cash paid in respect of land, including
land creditors, as operating rather than financing cashflows. This is a judgement as, whilst the repayment profile of land
creditors is important in assessing the Group’s liquidity and timing of future cash outflows, the Directors believe that
settlement of the land creditors is an operating cashflow on the basis that land purchases are integral to the Group’s
working capital management.
2 . R E V E N U E A N D O P E R AT I N G P R O F I T
a. Revenue
An analysis of the Group’s revenue, which is wholly generated in the UK in 2023 and 2022, is as follows:
Revenue from the sale of new housing
Revenue from the sale of land
2023
£M
2,083
44
2,127
2022
£M
2,119
21
2,140
Included within revenue from the sale of new housing is £109m (2022: £189m) of revenue from contracts with social
housing providers or private rental sector providers on which revenue is recognised over time by reference to the stage
of completion of contract activity. Of this amount £nil (2022: £36m) was included in contract liabilities at the beginning of
the year. The amount of revenue recognised in the current period from performance obligations satisfied (or partially
satisfied) in previous periods was £20m (2022: £nil).
Contract assets
Contract liabilities
NOTE
13
16
2023
£M
11
–
2022
£M
23
36
The contract assets relate to the Group's rights to consideration for work completed but not invoiced at the balance
sheet date for contracts on which revenue is recognised over time.
The contract liabilities, which are included within social customer payments on account in note 16, relate to the advance
consideration from customers at the balance sheet date for contracts on which revenue is recognised over time.
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Notes to the financial statements / continued
2 . R E V E N U E A N D O P E R AT I N G P R O F I T C O N T I N U E D
a. Revenue continued
The following table shows further revenue of £14m (2022: £98m) expected to be recognised in future years in respect of
contracts on which revenue is recognised over time:
4 . I N C O M E TA X E X P E N S E
Year ending June £m
Year ending June %
b. Operating profit
Operating profit is stated after charging:
Inventories expensed in the year
Amortisation
Depreciation – Property, plant and equipment
Depreciation – Lease right of use assets
Research and development expenditure
Exceptional item – Legacy fire safety provision
2024
14
100
2025
2026
TOTAL
–
–
–
–
14
100
Current tax charge
UK Corporation Tax in respect of current year
Adjustment in respect of prior years
Current tax charge/(credit)
Deferred tax
NOTE
2023
£M
2022
£M
Origination and reversal of temporary differences
14
8
9
10
1,538
1,715
–
2
2
1
–
1
–
–
2
3
1
164
1
–
Adjustment in respect of prior years
Deferred tax charge
Total income tax charge/(credit) income statement
Reconciliation of tax charge for the year
Profit before tax
Tax calculated at UK Corporation Tax rate at 20.5% (2022: 19.0%)
Residential Property Developer Tax at 4.0% (2022: 1.0%)
Tax charge for the year
Deferred tax recognised directly in equity
Relating to pension scheme
2022
PRE-
EXCEPTIONAL
ITEM
£M
2023
TOTAL
£M
2022
EXCEPTIONAL
ITEM
£M
2022
TOTAL
£M
98
(1)
97
–
–
–
97
395
81
16
97
12
12
82
–
82
–
–
–
82
410
78
4
82
–
–
(33)
–
(33)
–
–
–
(33)
(164)
(31)
(2)
(33)
–
–
49
–
49
–
–
–
49
246
47
2
49
–
–
Auditor’s remuneration – Fees payable to the Company’s Auditors for audit services (i)
– Fees payable to the Company’s Auditors for other services (ii)
Exceptional item in cost of sales
There were no exceptional costs in the 52 weeks ended 2 July 2023. In the 53 weeks ended 3 July 2022, there was an
exceptional item of £164m in cost of sales. This arose as a consequence of in April 2022, the Group signed up to the
Government’s Building Safety Pledge in respect of funding the remediation of life critical fire safety issues on buildings
over 11 metres in which the Group were involved, whether or not it constructed them, going back 30 years. The additional
£164m legacy fire safety provision was charged to cost of sales in respect of buildings the Group agreed to remediate
solely as a result of signing the voluntary Building Safety Pledge. This was treated as exceptional as it was outside the
normal course of business, non-recurring and material by size and nature and of such significance as to require separate
disclosure, in line with the accounting policy.
Fees payable to the Company’s Auditors comprise:
(i)
fees payable for the audit of parent company and consolidated financial statements £216,250 (2022: £157,500) and
fees payable for the audit of the Company’s subsidiaries pursuant to legislation £648,750 (2022: £472,500).
(ii)
No non-audit services were provided in either 2023 or 2022.
The 2023 ratio of non-audit fees to audit fees is 0:1 (2022: 0:1).
3 . N E T F I N A N C I N G C O S T S
Interest payable on bank loans
Imputed interest on deferred land creditors
Financial costs
Other interest receivable
Financial income
Net financing costs
222
2023
£M
2022
£M
(4)
(5)
(9)
5
5
(4)
(2)
(4)
(6)
2
2
(4)
An increase in the UK Corporation Tax rate from 19% to 25% effective 1 April 2023 was substantively enacted on 24 May
2022. No further increase has been substantively enacted in respect of future years.
Residential Property Developer Tax commenced on 1 April 2022 at a rate of 4.0% per annum, hence 1.0% for the 3
months ended 3 July 2022.
Current income tax charge in the Company is £nil (2022: £nil).
5 . D I V I D E N D S
The following dividends were paid by the Group:
Prior year final dividend per share of 22.0p (2022: 18.5p); Current year interim dividend per
share of 10.0p (2022: 10.0p)
2023
£M
108
108
2022
£M
100
100
The Board is proposing a final dividend of £66m being 20.0p per share (2022: £77m being 22.0p per share) subject to
Shareholder approval at the Annual General Meeting on 10 November 2023. There are ample distributable reserves from
which to lawfully pay the proposed dividend (see note 19).
Redrow plc received a non-cash dividend of £550m from its subsidiary undertaking HB (HDG) Limited settled via
inter-company account on 15 July 2022.
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Notes to the financial statements / continued
6 . E A R N I N G S P E R O R D I N A RY S H A R E
The basic earnings per share calculation for the 52 weeks ended 2 July 2023 is based on the weighted average number
of shares in issue during the period of 327m (2022: 342m) excluding those held in trust under the Redrow Long Term
Incentive Plan (10m shares (2022: 11m shares)), which are treated as cancelled.
7. E M P LOY E E S C O N T I N U E D
c. Key management remuneration
Key management personnel, as defined under IAS 24 ‘Related party disclosures’, are identified as the Executive
Management Team and the Non-Executive Directors.
Diluted earnings per share has been calculated after adjusting the weighted average number of shares in issue for all
potentially dilutive shares held under unexercised options.
Summary key management remuneration is as follows:
For the 52 weeks ended 2 July 2023
UNDERLYING AND STATUTORY
Basic earnings per share
Effect of share options and SAYE
Diluted earnings per share
EARNINGS
£M
NUMBER
OF SHARES
MILLIONS
PER SHARE
PENCE
298
–
298
327
1
328
91.2
(0.3)
90.9
1,764,773 LTIP share options and 1,037,498 deferred bonus share options outstanding at the period end (2022: 1,586,607
and 873,533) were not included in the calculation of diluted earnings per share as they are anti-dilutive for the
respective periods.
For the 53 weeks ended 3 July 2022
UNDERLYING – PRE-EXCEPTIONAL ITEM
Basic earnings per share
Effect of share options and SAYE
Diluted earnings per share
See note 23.
STATUTORY
Basic earnings per share
Effect of share options and SAYE
Diluted earnings per share
7. E M P LOY E E S
a. Cost (including Directors)
Wages and salaries
Social security costs
Other pension costs
Share-based payments
b. Number
The monthly average number of persons employed by the Group was:
Directors and administrative staff
Other personnel
224
EARNINGS
£M
NUMBER
OF SHARES
MILLIONS
PER SHARE
PENCE
328
–
328
342
1
343
96.0
(0.2)
95.8
EARNINGS
£M
NUMBER
OF SHARES
MILLIONS
PER SHARE
PENCE
197
–
197
342
1
343
57.7
(0.2)
57.5
G RO U P
CO M PA N Y
2023
£M
121
16
12
6
155
2022
£M
120
16
10
4
150
2023
£M
2022
£M
2
1
–
1
4
2
1
–
1
4
G RO U P
CO M PA N Y
2023
NUMBER
2022
NUMBER
2023
NUMBER
2022
NUMBER
935
1,335
2,270
907
1,340
2,247
7
–
7
7
–
7
Salaries and short-term employee benefits
Share-based payments
2023
£M
2022
£M
5
2
7
5
2
7
The number of Directors where retirement benefits are accruing in respect of defined benefit schemes are 1 (2022: 1).
The aggregate amount of gains made by Directors on the exercise of share options was £0.2m (2022: £0.3m).
Detailed disclosure of Directors’ emoluments and interests in shares are included in the Directors’ Remuneration Report
on pages 166 to 191, notably the 'Single Total Figure of Remuneration Table (Audited)' on page 182 which details
remuneration paid to or received by directors in respect of qualifying services, and the 'Statement of Shareholding and
Scheme Interests (Audited)' on page 186.
d. Share-based payments
Save As You Earn Share Option scheme (SAYE)
The Redrow plc SAYE scheme is open to all employees and share options can be exercised either three or five years
after the date of grant, depending on the length of the savings contract. The SAYE schemes are not subject to
performance conditions.
The SAYE schemes have been valued using the Black-Scholes pricing model.
Options granted during the year
Date of grant
Fair value at measurement date
Share price
Exercise price
Option life (contract length)
Expected dividend yield
Risk free interest rate
2023
2,756,663
2022
792,961
1 January 2023
1 January 2022
£1.38
£3.92
£3.14
£2.30
£6.55
£5.24
3/5 years
3/5 years
3.38%
1.5%
3.38%
1.5%
The expected volatility on SAYE schemes is based on the historic volatility of the Group’s share price over periods equal
to the length of the savings contract.
Long Term Incentive scheme (LTIP)
Except in specified circumstances, options granted under the scheme are exercisable between three and ten years after
the date of grant.
Options granted under the LTIP on 21 September 2022 were granted to a limited number of Senior Executives. The
performance conditions applying to this grant were EPS, ROCE and carbon reduction targets. The Remuneration
Committee revisited the terms of the award around 6 months following the grant of the award and revised two of the
performance measures in the light of economic conditions being EPS and ROCE and replaced them with a market based
Total Shareholder Return (TSR) condition. To reflect these changes in performance conditions 6 months into the 36
month performance period participants surrendered 1/6th of the share options originally granted. The scheme is
discussed in greater detail within the Directors’ Remuneration Report notably within the 'Directors' Remuneration Policy'
on page 174.
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Notes to the financial statements / continued
7. E M P LOY E E S C O N T I N U E D
d. Share-based payments continued
The LTIP granted on 21 September 2022 was modified on 11 April 2023 which resulted in an incremental fair value of
£1.1m which will be recognised over the remaining vesting period.
The LTIP has been valued using the Black-Scholes pricing model for the non-market based performance conditions and
a stochastic model for the market based TSR condition.
Options granted during the year
Date of grant
Fair value at the measurement date
Share price on date of grant/and modification
Exercise price
Expected volatility
Option life
Expected dividend yield
Risk free interest rate
2023
584,388
†
2022
461,937
21 September 2022
21 September 2021
£4.776/£2.092/£2.174
£4.967/£4.780
£0.00
30.90%
3 years
N/A
3.31%/3.73%
£7.146
£7.146
£0.00
N/A*
3 years
N/A
N/A*
*
†
For nil-cost awards not subject to a market based condition, volatility and risk free rate are not applicable.
Post surrender of 1/6th of options as noted on pages 167 to 168.
The fair value at the measurement date of the LTIP granted on 21 September 2022 and modified on 11 April 2023 was
£4.776 in respect of non-market based performance condition and £2.092 and £2.174 in respect of the market based TSR
condition. The £2.092 fair value relates to options granted to the Executive Directors which have a holding period
condition beyond the vesting date of the options.
In addition a £29,000 charge arose in the year on the partial surrender of the options.
The fair value at the measurement date of the LTIP granted on 21 September 2021 comprises £7.146 in respect of
non-market based performance conditions.
Deferred Bonus Incentive (DBI)
Grants under the DBI were limited to Senior Management. Except in specified circumstances options granted under the
scheme are exercisable between one and ten years after the date of grant for Tranche 1 and between two and ten years
after the date of grant for Tranche 2 and are not subject to performance conditions.
In respect of options granted during the financial year ended 2 July 2023, Deferred Bonus Incentive Tranche 1 and 2
were absolute contractual entitlements to a small number of individuals and were granted on 21 September 2022.
The DBI has been valued using the Black-Scholes pricing model.
Options granted during the year
450,696
450,778
347,870
347,945
2023
TRANCHE 1
2023
TRANCHE 2
2022
TRANCHE 1
2022
TRANCHE 2
Date of grant
Fair value at the measurement date
Share price
Exercise price
Expected volatility
Option life
Expected dividend yield
Risk free interest rate
21 September
2022
21 September
2022
21 September
2021
21 September
2021
£4.967
£4.967
£0.00
N/A*
1 year
N/A*
N/A*
£4.967
£4.967
£0.00
N/A*
2 years
N/A*
N/A*
£7.146
£7.146
£0.00
N/A*
1 year
N/A
N/A*
£7.146
£7.146
£0.00
N/A*
2 years
N/A
N/A*
*
For nil-cost awards not subject to a market based condition, volatility and risk free rate are not applicable.
226
DATE OF GRANT
NUMBER
OF OPTIONS
2023
NUMBER
OF OPTIONS
2022
EXERCISE
PRICE
7. E M P LOY E E S C O N T I N U E D
d. Share-based payments continued
Share options outstanding
The following share options were outstanding at 2 July 2023:
TYPE OF SCHEME
Long Term Share Incentive 2019
Long Term Share Incentive 2020
Long Term Share Incentive 2021
Long Term Share Incentive 2022
Deferred Bonus Incentive 2013 – Tranche 1
Deferred Bonus Incentive 2013 – Tranche 2
Deferred Bonus Incentive 2014 – Tranche 1
Deferred Bonus Incentive 2014 – Tranche 2
Deferred Bonus Incentive 2015 – Tranche 1
Deferred Bonus Incentive 2015 – Tranche 2
Deferred Bonus Incentive 2016 – Tranche 1
Deferred Bonus Incentive 2016 – Tranche 2
Deferred Bonus Incentive 2017 – Tranche 1
Deferred Bonus Incentive 2017 – Tranche 2
Deferred Bonus Incentive 2018 – Tranche 1
Deferred Bonus Incentive 2018 – Tranche 2
Deferred Bonus Incentive 2019 – Tranche 1
Deferred Bonus Incentive 2019 – Tranche 2
11 September 2019
68,888
22 September 2020
678,328
21 September 2021
441,454
21 September 2022
576,103
24 September 2013
24 September 2013
8 September 2014
8 September 2014
14 September 2015
14 September 2015
12 September 2016
12 September 2016
11 September 2017
11 September 2017
10 September 2018
10 September 2018
11 September 2019
11 September 2019
4,642
4,642
3,615
3,615
3,069
3,070
5,070
9,948
6,418
6,555
12,674
41,060
42,167
66,106
34,526
73,904
Deferred Bonus Incentive 2020 – Single Tranche
15 March 2021
Deferred Bonus Incentive 2021 – Tranche 1
21 September 2021
Deferred Bonus Incentive 2021 – Tranche 2
21 September 2021
132,865
330,159
Deferred Bonus Incentive 2022 – Tranche 1
21 September 2022
183,898
Deferred Bonus Incentive 2022 – Tranche 2
21 September 2022
399,654
Save As You Earn
Save As You Earn
Save As You Earn
Save As You Earn
Save As You Earn
Save As You Earn
Save As You Earn
1 January 2017
1 January 2018
1 January 2019
281
22,620
24,604
1 January 2020
116,036
318,335
1 January 2021
909,562
1,398,148
1 January 2022
246,325
717,664
1 January 2023 2,582,336
–
The total share options outstanding at 2 July 2023 under the LTIP, Deferred Bonus Incentive Plan and the Save As You
Earn schemes represent 2.0% of the issued share capital (2022: 1.4%).
411,800
712,870
461,937
–
4,642
4,642
3,615
3,615
3,069
3,070
5,136
10,015
7,142
7,617
16,563
56,436
59,466
95,503
58,094
169,159
–
–
9,843
43,430
42,257
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
£3.20
£4.90
£4.62
£4.94
£3.78
£5.24
£3.14
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Notes to the financial statements / continued
7. E M P LOY E E S C O N T I N U E D
d. Share-based payments continued
Movements in the year
The number and weighted average exercise prices of share options is as follows:
Long Term Share Incentive scheme:
Outstanding at the beginning of the year
Partial surrender of LTIP 2022
Lapsed during the year
Exercised during the year
Granted during the year
Outstanding at the end of the year
Exercisable at the end of the year
Deferred Bonus Incentive scheme:
Outstanding at the beginning of the year
Lapsed during the year
Exercised during the year
Granted during the year
Outstanding at the end of the year
Exercisable at the end of the year
Save As You Earn scheme:
Outstanding at the beginning of the year
Lapsed during the year
Exercised during the year
Granted during the year
Outstanding at the end of the year
Exercisable at the end of the year
NUMBER
OF OPTIONS
2023
WEIGHTED
AVERAGE
EXERCISE PRICE
2023
NUMBER
OF OPTIONS
2022
WEIGHTED
AVERAGE
EXERCISE PRICE
2022
1,586,607
(117,159)
(396,147)
(10,075)
701,547
1,764,773
4,708
873,533
(71,115)
(666,394)
901,474
1,037,498
542,685
2,529,677
(1,215,037)
(169,539)
2,756,663
3,901,764
130,177
–
–
–
–
–
–
–
–
–
–
–
–
–
£4.37
£4.33
£4.78
£3.14
£3.49
£4.92
1,396,914
–
(272,244)
–
461,937
1,586,607
–
823,461
(38,613)
(607,130)
695,815
873,533
374,215
2,445,541
(315,864)
(392,961)
792,961
2,529,677
38,292
–
–
–
–
–
–
–
–
–
–
–
–
–
£4.09
£4.43
£4.38
£5.24
£4.37
£4.37
The weighted average share price at the various dates of exercise of share options during the year was £4.89 (2022:
£6.27).
The options outstanding at 2 July 2023 had a range of exercise prices of £nil to £5.24 (2022: £nil to £5.24) and a
weighted average remaining contractual life of 4.6 years (2022: 5.0 years).
The expected life used in the models has been adjusted, based on best estimates, to reflect exercise restrictions and
behavioural considerations.
The charge to income in relation to equity settled share-based payments in the year is £6m (2022: charge £4m).
228
7. E M P LOY E E S C O N T I N U E D
e. Retirement benefit schemes
The Redrow Staff Pension Scheme comprises a defined benefit scheme. The Company also offers a defined contribution
scheme to employees. The defined benefit scheme was closed to new entrants from July 2006, having been closed to
all but a limited number of agreed new entrants from October 2001. The defined benefit scheme was closed to future
accrual with effect from 1 March 2012.
The Scheme operates within the frameworks of the applicable pension’s legislation and is regulated by the Pensions
Regulator. The Scheme is managed by a board of Trustees who act in line with legislation and the provisions set out
within the Trust Deed and Rules which underpin the day-to-day operation of the Scheme. The Trustees' overarching aim
is to ensure that there are sufficient monies available to pay members benefits when they fall due. The Trustees work in
collaboration with the Company to manage the risks that this aim might not be met.
On 27 January 2023, the Trustees of the Redrow Staff Pension Scheme entered into a bulk annuity buy-in contract with
Standard Life. This transaction is part of the Trustees' long term strategy to reduce the Scheme’s exposure to risk with
the Trustees agreeing to exchange the assets of the Scheme for an insurance policy which exactly matches the
projected cashflows for all future pension benefits. No additional cash funding from the Company was required to fund
this. Thus under the bulk annuity the Trustees will receive payments from Standard Life which they will use to pay
pension benefits due to the members in the Scheme.
The buy-in reduces future pension and funding risk from a Company perspective. However, the Trustees making the
strategic investment decision and entering into the bulk annuity buy-in contract does not impact the Company’s
obligations in relation to the Scheme. In particular, the Company remains primarily responsible for ensuring that
employee benefits are funded for when they fall due. The insurance policies have been issued in the name of the
Scheme and currently there is neither intention nor any decision to transfer the policies in the name of members of the
Scheme. Therefore as the Company retains responsibility for all its obligations in relation to the Scheme, it continues to
treat the Scheme as a defined benefit plan as permitted by IAS 19.
The total pension charge for the year was £46m (2022: charge of £11m). A charge of £34m related to the defined benefit
section of the Scheme (2022: charge of £1m), with £nil being charged to the income statement (2022: charge of £nil) and
a charge of £34m to the statement of comprehensive income (2022: charge of £1m). The charge arising from the defined
contribution section was £12m (2022: £10m).
Triennial valuation
A full independent triennial actuarial valuation of the defined benefit section of the Scheme was undertaken at 1 July
2020 using the Projected Unit Actuarial Funding Method. As at 1 July 2020, in the opinion of the Actuary, there was a
deficit of £4m in the defined benefit section of the Scheme, based on the Trustees’ technical provisions assumptions with
the Scheme’s assets representing 98% of the Scheme’s technical provisions. As at 1 July 2020 the value of the defined
benefit section of the Scheme’s assets was £172m. The previous triennial valuation was undertaken as at 1 July 2017 and
reported a deficit of £15m. The triennial valuation as at 1 July 2023 is currently ongoing.
Defined benefit scheme – IAS 19R valuation
Redrow recognises all remeasurements for its defined benefit plan in the period in which they occur, outside the income
statement, in the statement of comprehensive income.
This disclosure relates to the defined benefit section of the Scheme. The Scheme’s assets are held separately from the
assets of Redrow and are administered by the trustees and managed professionally. Following the decision taken by the
Trustees to purchase a bulk annuity buy-in contract with Standard Life, this insurance policy now represents the majority
of the assets held by the Scheme.
The latest formal actuarial valuation of the defined benefit section was carried out at 1 July 2020. This valuation has been
updated to 2 July 2023 by a qualified actuary for the purposes of these financial statements.
The Group contributed £nil to the Scheme in the year ended 2 July 2023 (2022: £nil) and expects to contribute £nil to the
Scheme in the year ending 30 June 2024.
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Notes to the financial statements / continued
7. E M P LOY E E S C O N T I N U E D
e. Retirement benefit schemes continued
7. E M P LOY E E S C O N T I N U E D
e. Retirement benefit schemes continued
The major financial assumptions used in arriving at the IAS 19R valuation were:
The defined benefit obligation can be approximately attributed to the scheme members as follows:
Deferred members
Pensioner members
All benefits are vested at 2 July 2023 (unchanged from 3 July 2022).
The total amounts credited/(charged) against income in the year were as follows:
Amounts included within the income statement:
Administrative expenses
Net interest on defined benefit liability
Amounts recognised in the statement of comprehensive income:
Return on scheme assets excluding interest income
Actuarial movements arising from changes in demographic assumptions
Actuarial movements arising from changes in financial assumptions
Actuarial movements arising from experience adjustments
2023
%
59
41
100
2022
%
62
38
100
G RO U P A N D CO M PA N Y
2023
£M
2022
£M
(1)
1
–
(56)
5
21
(4)
(34)
(34)
–
–
–
(40)
–
40
(1)
(1)
(1)
The amount included in the balance sheet arising from the surplus in respect of the Group’s defined benefit section is as
follows:
Long-term rate of increase in pensionable salaries
Rate of increase of benefits in payment (lesser of 5% per annum and RPI)1
Rate of increase of benefits in payment (lesser of 2.5% per annum and RPI)2
Discount rate
Inflation assumption – RPI
– CPI
1
2
In respect of pensions in excess of the guaranteed minimum pension earned prior to 30 June 2006.
In respect of pensions earned after 30 June 2006. Other pension increases are valued in a consistent manner.
2023
N/A
3.1%
2.0%
5.1%
3.3%
2.9%
2022
N/A
3.1%
2.0%
3.8%
3.3%
3.1%
The mortality tables used in the actuarial valuation were as follows (which make allowance for projected further
improvements in mortality):
For male and female members:
SAPS3 CMI_2022 1.50% Long Term Trend (Core) (2022: SAPS3 CMI_2021 1.50% Long
Term Trend (Sk 7.5))
The life expectancies from age 65 implied by these tables for typical members are:
Pensioner currently aged 65:
Male 21.6 years (2022: Male 22.3 years)
Future pensioner currently aged 40: Male 23.7 years (2022: Male 24.4 years)
Female 24.1 years (2022: Female 24.6 years)
Female 26.2 years (2022: Female 26.8 years)
It has been assumed that members take 80% of the maximum tax-free cash available to them at the point they retire via
commutation of their pension.
The total assets, the split between the major asset classes in the Scheme, the present value of the Schemes’ liabilities
and the amounts recognised in the balance sheet are shown below:
G RO U P A N D CO M PA N Y
2023
£M
2023
£M
2022
£M
2022
£M
QUOTED
MARKET PRICE IN
ACTIVE MARKET
NO QUOTED
MARKET PRICE IN
ACTIVE MARKET
2023
£M
TOTAL
QUOTED
MARKET PRICE IN
ACTIVE MARKET
NO QUOTED
MARKET PRICE IN
ACTIVE MARKET
2022
£M
TOTAL
Equities
Debt instruments
Real estate
Investment funds
Other
Cash and cash equivalents
Insurance policies
Total market value of assets
Present value of obligations
Surplus in the Scheme
–
–
–
–
–
6
–
6
–
–
–
–
–
–
73
73
–
–
–
–
–
6
73
79
(74)
5
50
56
1
4
7
16
–
134
–
–
–
–
–
–
2
2
50
56
1
4
7
16
2
136
(97)
39
The Scheme’s assets are invested in such a way so as to ensure that the assets are sufficient and appropriate to meet
the associated liabilities as they fall due.
230
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Notes to the financial statements / continued
7. E M P LOY E E S C O N T I N U E D
e. Retirement benefit schemes continued
Balance sheet surplus
At start of year
Amounts (charged) against statement of comprehensive income
Employer contributions paid
At end of year
Changes in the present value of the defined benefit obligation:
At start of year
Interest expense
Benefit payments
Actuarial movements arising from changes in demographic assumptions
Actuarial movements arising from changes in financial assumptions
Actuarial movements arising from experience adjustments
At end of year
Changes in the fair value of the Scheme’s assets:
At start of year
Interest income
Return on scheme assets excluding interest income
Administrative expenses paid from plan assets
Benefit payments
At end of year
G RO U P A N D CO M PA N Y
2023
£M
2022
£M
39
(34)
–
5
97
3
(4)
(5)
(21)
4
74
136
4
(56)
(1)
(4)
79
40
(1)
–
39
137
3
(4)
–
(40)
1
97
177
3
(40)
–
(4)
136
8 . I N TA N G I B L E A S S E T S
The Group
Cost
At 27 June 2021
Additions
Disposals
At 3 July 2022
Additions
Disposals
At 2 July 2023
Accumulated amortisation
At 27 June 2021
Charge
Disposals
At 3 July 2022
Charge
Disposals
At 2 July 2023
Net book value
At 2 July 2023
At 3 July 2022
At 27 June 2021
The Scheme rules permit the refund of any surplus to the Company with no restrictions. The surplus has therefore been
recognised in full in the Group and Company balance sheets and there is no requirement to restrict the surplus nor to
recognise any additional liability in respect of agreed deficit contributions.
Sensitivity of key assumptions
The table below gives a broad indication of the impact on the IAS 19R numbers to changes in assumptions and
experience (away from the assumptions shown on page 230). All figures are before allowing for deferred tax.
ITEM
Present value of defined benefit obligation (£m)
Discount rate -25 basis points
Discount rate +25 basis points
Price inflation rate -25 basis points
Price inflation rate +25 basis points
Post-retirement mortality assumption – 1 year age adjustment
Weighted average duration of defined benefit obligation (in years)
Discount rate -25 basis points
Discount rate +25 basis points
APPROXIMATE
AMOUNT
2023
APPROXIMATE
AMOUNT
2022
77.2
71.4
71.5
77.1
76.0
16.0
15.0
101.1
92.4
92.6
100.9
99.3
18.2
17.8
After completion of the buy-in transaction, the value of the bulk annuity insurance policy as an asset is set to be equal to
the value of the IAS19 liabilities. Therefore, any change in assumptions that would increase or decrease the value of the
defined benefit obligation would have a corresponding increase or decrease in the asset value resulting in an overall net
asset position that would be unchanged. As such, the net asset balance is no longer sensitive to changes in the
assumptions used.
232
GOODWILL
£M
SOFTWARE
£M
TOTAL
£M
1
–
–
1
–
–
1
1
–
–
1
–
–
1
–
–
–
2
1
–
3
–
–
3
2
–
–
2
–
–
2
1
1
–
3
1
–
4
–
–
4
3
–
–
3
–
–
3
1
1
–
N
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t
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233
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statementsFinancial statements
Notes to the financial statements / continued
9. P R O P E R T Y, P L A N T A N D E Q U I P M E N T
The Group
1 0. LE A S E R I G H T O F U S E A S S E T S
The Group
FREEHOLD
PROPERTY
£M
PLANT AND
MACHINERY
£M
FIXTURES
AND FITTINGS
£M
TOTAL
£M
PROPERTY
£M
PHOTOCOPIERS
£M
VEHICLES
£M
TOTAL
£M
Cost
At 27 June 2021
Additions
Disposals
At 3 July 2022
Additions
Disposals
At 2 July 2023
Accumulated depreciation
At 27 June 2021
Charge
Disposals
At 3 July 2022
Charge
Disposals
At 2 July 2023
Net book value
At 2 July 2023
At 3 July 2022
At 27 June 2021
24
–
–
24
3
–
27
7
–
–
7
1
–
8
19
17
17
3
–
–
3
–
–
3
3
–
–
3
–
–
3
–
–
–
11
3
–
14
1
–
15
9
2
–
11
1
–
12
3
3
2
38
3
–
41
4
–
45
19
2
–
21
2
–
23
22
20
19
Cost
At 27 June 2021
Additions
Disposals
At 3 July 2022
Additions
Disposals
At 2 July 2023
Accumulated depreciation
At 27 June 2021
Charge
At 3 July 2022
Charge
At 2 July 2023
Net book value
At 2 July 2023
At 3 July 2022
At 27 June 2021
4
–
–
4
–
–
4
2
–
2
–
2
2
2
2
1
–
–
1
–
–
1
–
–
–
–
–
1
1
1
7
2
–
9
7
–
16
4
3
7
2
9
7
2
3
12
2
–
14
7
–
21
6
3
9
2
11
10
5
6
N
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235
234
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statementsFinancial statements
Notes to the financial statements / continued
1 0 . L E A S E R I G H T O F U S E A S S E T S C O N T I N U E D
The Group continued
Lease liabilities
Maturity analysis – contractual undiscounted cash flows
Less than one year
One to five years
More than five years
Total undiscounted lease liabilities
AS AT
2 JULY
2023
£M
AS AT
3 JULY
2022
£M
4
7
–
11
2
4
–
6
1 1 . I N V E S T M E N T S
a. Investments
Joint ventures
b. Investments in subsidiary undertakings
At 3 July 2022 and 2 July 2023
G RO U P
CO M PA N Y
2023
£M
–
–
2022
£M
–
–
2023
£M
–
–
2022
£M
–
–
COMPANY
£M
–
On implementation of IFRS 16 leases, lease payment commitments are reported within trade and other payables.
AS AT
2 JULY
2023
£M
AS AT
3 JULY
2022
£M
4
6
10
2
4
6
AS AT
2 JULY
2023
£M
AS AT
3 JULY
2022
£M
The principal subsidiary company is Redrow Homes Limited. All subsidiary companies are incorporated in Great Britain
except Redrow Homes (Park Heights) Limited which is incorporated in Jersey. A full list of subsidiary undertakings as at
2 July 2023 is shown on page 238. The capital of all the subsidiary companies, consisting of ordinary shares, is wholly
owned by HB (HDG) Limited which in turn is wholly and directly owned by Redrow plc.
The principal activity of Redrow Homes Limited, Redrow Real Estate Limited, Redrow Regeneration plc, The Waterford
Park Company Limited and The Waterford Park Company (Balmoral) Limited is residential development. The principal
activity of Harrow Estates plc is land acquisition, development and resale. HB (HDG) Limited is an intermediate holding
company. St David’s Park Limited principal activity is business park maintenance services.
Those subsidiaries marked with † are dormant and exempt from audit.
Those subsidiaries marked with * are covered by a guarantee provided by Redrow plc and are consequently entitled to
an exemption under s.479A of the Companies Act from the requirement relating to the audit of individual accounts. Under
this guarantee, the Group will guarantee all outstanding liabilities of these entities. No liability is expected to arise under
the guarantee.
All the subsidiaries registered office is Redrow House, St David’s Park, Flintshire, CH5 3RX apart from those marked (i)
and (ii) whose registered offices are as follows:
–
–
(i) c/o TLT LLP, 140 West George Street, Glasgow, G2 2HG
(ii)
13 Castle Street, St. Helier, Jersey, JE4 5UT
AS AT
2 JULY
2023
£M
AS AT
3 JULY
2022
£M
3
3
Lease liabilities included in the statement of financial position
Current
Non-current
Amounts recognised in profit or loss
Interest on lease liabilities
Amounts recognised in the statement of cashflows
Total cash outflow for leases
236
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237
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statementsFinancial statements
Notes to the financial statements / continued
1 1 . I N V E S T M E N T S C O N T I N U E D
b. Investments in subsidiary undertakings continued
1 2 . D E F E R R E D TA X A S S E T S A N D L I A B I L I T I E S
The following are the deferred tax assets and liabilities recognised by the Group and the movements thereon during the
current and prior year:
Subsidiaries
Name
HB (HDG) Limited
Redrow Homes Limited
Harrow Estates plc *
Redrow Real Estate Limited
Redrow Regeneration plc *
Redmira Limited †
HB (NW) Limited †
HB (LCS) Limited (i) †
HB (MID) Limited †
HB (SW) Limited †
HB (SWA) Limited †
HB (Y) Limited †
HB (ESTN) Limited †
HB (WM) Limited †
HB (SM) Limited †
HB (SN) Limited †
HB (WC) Limited †
HB (WX) Limited †
HB (EM) Limited †
HB (CD) Limited †
HB (GRPS) Limited †
HB (CPTS) Limited †
HB (SE) Limited †
HB (CSCT) Limited (i) †
HB (SC) Limited (i) †
COMPANY
NUMBER
1990709
1990710
6825371
3996541
5405272
7587765
1189328
SC38052
2469449
3522335
2230870
2293006
4017345
3379746
3522321
537405
4984069
1940936
2827161
2034733
2898913
1079513
3988594
SC231364
SC74732
Name
HB (1995) Limited (i) †
Redrow Homes (Wallyford) Limited (i) †
St David’s Park Limited
PB0311 Limited †
Debut Freeholds Limited †
Tay Homes (Western) Limited †
Tay Homes (Northern) Limited †
Tay Homes (Midlands) Limited †
Tay Homes (North West) Limited †
Redrow Homes (Park Heights) Limited (ii) †
Redrow Construction Limited †
Poche Interior Design Limited †
Redrow (Shareplan) Limited †
Cadmoore Limited †
Redrow (Sudbury) Limited †
The Waterford Park Company Limited *
The Waterford Park Company (Balmoral) Limited
HB (Herne Bay No 1) Limited †
HB (Herne Bay No 2) Limited †
Redrow Homes East Midlands Limited †
Radleigh Construction Limited †
Radleigh Homes Limited †
Radbourne Edge (Holdings) Limited †
Redrow Langley Limited †
Radleigh (Hackwood) Limited †
COMPANY
NUMBER
SC155021
SC205159
2479183
7577839
4638403
2806562
2708575
2183136
2189721
66240
1375826
2169473
3520984
3977222
4558070
5429823
6047122
7743649
9163243
4219459
4219460
4210633
8737345
7306461
8131049
Deferred tax assets
At 27 June 2021
Charge to income
Charge to equity
At 3 July 2022
Charge to income
Charge to equity
At 2 July 2023
Deferred tax liabilities
At 27 June 2021
Charge to income
Charge to equity
At 3 July 2022
Charge to income
Charge to equity
At 2 July 2023
IMPUTED
INTEREST
£M
SHORT-TERM
TEMPORARY
DIFFERENCES
£M
TOTAL
£M
–
–
–
–
–
–
–
1
–
–
1
–
–
1
1
–
–
1
–
–
1
EMPLOYEE
BENEFITS
£M
SHORT-TERM
TEMPORARY
DIFFERENCES
£M
TOTAL
£M
(13)
–
–
(13)
–
12
(1)
(2)
–
–
(2)
–
–
(2)
(15)
–
–
(15)
–
12
(3)
The Group has no material unrecognised deferred tax assets.
An increase in the UK corporation tax rate from 19% to 25% (effective 1 April 2023) was substantively enacted on 24 May
2022. In addition, the Government introduced a new Residential Property Developer tax of 4% on profit effective from 1
April 2022. The deferred tax asset and liability at 2 July 2023 has been calculated at 29% based on these rates (2022:
29%) with the exception of the deferred tax liability on employee benefits which has been calculated at 35% (2022: 35%).
This reflects the results of the latest triennial valuation of the defined benefit section of The Redrow Staff Pension
Scheme (see page 229) which now suggests the return of the IAS 19 surplus is highly likely to take the form of a lump
sum cash refund rather than a reduction in future deficit contributions.
The Company has deferred tax liabilities of £2m (2022: £10m).
N
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239
238
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statementsFinancial statements
i
F
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Notes to the financial statements / continued
1 3 . T R A D E A N D OT H E R R E C E I VA B L E S
1 4 . I N V E N TO R I E S C O N T I N U E D
G RO U P
CO M PA N Y
The table below details the movement on the inventory net realisable value provision in the year.
Non-current assets
Trade receivables (net)
Amounts due from subsidiary companies
Current assets
Trade receivables (net)
Contract assets
Amounts due from subsidiary companies
Other receivables
Prepayments
2023
£M
2022
£M
–
–
–
13
11
–
13
5
42
–
–
–
22
23
–
25
6
76
2023
£M
–
860
860
–
–
117
–
–
117
2022
£M
–
266
266
–
–
317
–
–
317
Current trade receivables are stated after an allowance of £9m (2022: £7m) in respect of expected credit losses with £nil
provision utilised (2022: £nil), £nil provision released (2022: £1m) and £2m provision created (2022: £nil). Expected credit
losses are calculated based on lifetime expected credit losses at each reporting date. The risk has increased at the
current balance sheet date due to the impact of interest rate and mortgage rate rises.
Amounts due from subsidiary companies are unsecured, repayable on demand and carry interest at market rate. The
balance classified as current is anticipated to be repayable within the normal operating cycle of the subsidiary
businesses (c4 years as explained in more detail on page 219). Of this amount £22m (2022: £100m) is expected to be
recovered within 12 months of the balance sheet date. No allowance for expected credit losses is considered necessary
in respect of amounts due from subsidiary companies as any such expected credit losses are considered to be
immaterial.
1 4 . I N V E N TO R I E S
Land for development
Work in progress
Stock of show homes
G RO U P
CO M PA N Y
2023
£M
1,684
1,017
69
2,770
2022
£M
1,710
962
68
2,740
2023
£M
2022
£M
–
–
–
–
–
–
–
–
Inventories of £1,538m were expensed in the year (2022: £1,715m). Work in progress includes £1m (2022: £1m) in respect
of part exchange properties. Land held for development in the sum of £215m is subject to a legal charge as security in
respect of amounts due in respect of development land (2022: £300m).
The carrying value of undeveloped land where net realisable value has been determined on the basis of a sale of land in
its current state is £2m (2022: £1m). Land for development includes £68m (2022: £111m) of strategic land owned without a
residential planning consent net of a net realisable value provision of £9m (2022: £14m). There is a £17m (2022: £8m) net
realisable value provision against land with a residential planning consent.
4 July 2022/28 June 2021
Created
Released
Utilised
As at 2 July 2023/3 July 2022
G RO U P
CO M PA N Y
2023
£M
2022
£M
2023
£M
2022
£M
22
13
(8)
(1)
26
14
8
–
–
22
–
–
–
–
–
–
–
–
–
–
The Directors consider all inventory to be current in nature as they are expected to be realised within the Group’s normal
operating cycle of c4 years.
1 5 . F I N A N C I A L R I S K M A N AG E M E N T
The Group’s financial instruments comprise cash and cash equivalents and various items included within trade
receivables and trade payables which arise during the normal course of business.
The tables that follow provide a summary of financial assets and liabilities by category.
The accounting policies for financial instruments have been applied to the following items:
The Group’s activities expose it to a variety of financial risks.
Financial risk management is conducted centrally using policies approved by the Board. Market risk is negligible due to
the Group’s limited exposure to equity securities (some limited exposure arises through the Redrow Staff Pension
Scheme’s investment portfolio) and the associated price risk. Its foreign exchange exposure is negligible given the
nature of the Group’s business and its exclusive UK activities.
a. Liquidity risk and interest rate risk
Liquidity risk is the risk that the Group does not have sufficient financial resources to meet its obligations as they fall
due. Liquidity risks are managed through the regular review of cash forecasts and by maintaining adequate committed
banking facilities to ensure appropriate headroom.
At 2 July 2023, the Group had total unsecured bank borrowing facilities of £353m, representing £350m committed
facilities and £3m uncommitted facilities.
The Group’s cash surpluses arise from short-term timing differences. As a consequence the Group does not consider it
bears significant risk of changes to income and cash flows as a result of movements on interest rates on its interest
bearing assets.
The Group is exposed to interest rate risk as it borrows money at floating rates. The Group’s interest rate risk arises
primarily from long-term borrowings. In order to manage its interest rate risk, the Group from time to time enters into
simple risk management products, almost exclusively interest rate swaps. All interest rate swaps are sterling
denominated. The swaps are arranged so as to match with those of the underlying borrowings to which they relate.
There were no interest rate swaps in place in 2023 or 2022.
b. Maturity of bank loans and borrowings
There were no outstanding bank loans or bank borrowings as at 2 July 2023 or 3 July 2022.
The Company was fully compliant with its banking covenants as at 2 July 2023.
At the year end, the Group and Company had £350m (2022: £350m) of undrawn committed bank facilities available.
There is no material difference between the fair value of the bank overdrafts and bank loans and their carrying values as
shown in the balance sheet.
c. Amounts due in respect of development land
The Group’s policy permits land purchases to be made on deferred payment terms. In accordance with IFRS 9, the
deferred creditor is recorded at fair value and nominal value is amortised over the deferment period via financing costs,
increasing the land creditor to its full cash settlement value on the payment date.
240
The interest rate used for each deferred payment is an equivalent loan rate available on the date of land purchase, as
applicable to a loan lasting for a comparable period of time to that deferment.
241
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statements
Notes to the financial statements / continued
1 5 . F I N A N C I A L R I S K M A N AG E M E N T C O N T I N U E D
c. Amounts due in respect of development land continued
1 5 . F I N A N C I A L R I S K M A N AG E M E N T C O N T I N U E D
e. Credit risk continued
The maturity profile of the total contracted cash payments in respect of amounts due in respect of land creditors at the
balance sheet date is as follows:
No credit limits were exceeded during the reporting year or subsequently and the Group does not anticipate any losses
from non-performance by these counterparties.
2 July 2023
3 July 2022
TOTAL
CONTRACTED
CASH
PAYMENT
£M
DUE
LESS THAN
ONE YEAR
£M
DUE
BETWEEN
ONE AND
TWO YEARS
£M
DUE
BETWEEN
TWO AND
FIVE YEARS
£M
276
380
174
289
81
51
21
40
BALANCE
£M
272
376
d. Maturity of trade and other payables
The maturity profile of the total contracted payments in respect of financial liabilities (excluding amounts due on land
creditors shown separately in note 15c) at the balance sheet date is as follows:
Trade and other payables (excluding lease liabilities)
Lease liabilities
2 July 2023
Trade and other payables (excluding lease liabilities)
Lease liabilities
3 July 2022
e. Credit risk
TOTAL
CONTRACTED
CASH
PAYMENT
£M
DUE
LESS THAN
ONE YEAR
£M
DUE
BETWEEN
ONE AND
TWO YEARS
£M
DUE
BETWEEN
TWO AND
FIVE YEARS
£M
468
11
479
530
6
536
468
4
472
530
2
532
–
4
4
–
2
2
–
3
3
–
2
2
BALANCE
£M
468
10
478
530
6
536
Credit risk arises from cash and cash equivalents, including call deposits with banks and financial institutions, trade
receivables and contract assets. It represents the risk of financial loss where counterparties are unable to meet their
obligations.
Credit risk is managed centrally in respect of cash and cash equivalents. In respect of placing deposits with banks and
financial institutions and funds, individual risk limits are approved by the Board. The table below shows the cash and
cash equivalents as at the balance sheet date:
Held at banks with at least an A credit rating per Standard & Poor's
G RO U P
CO M PA N Y
2023
£M
235
235
2022
£M
288
288
2023
£M
238
238
2022
£M
285
285
There is no specific concentration of credit risk in respect of home sales as the exposure is spread over a number of
customers. In respect of trade receivables and contract assets, the amounts presented in the balance sheet are stated
after adjusting for any expected credit losses which are calculated based on lifetime expected credit losses at each
reporting date. In the majority of cases, the Group receives cash on legal completion for private sales (excluding PRS).
The Group applies for and receives stage payments from registered providers for affordable homes and PRS providers
and considers it has an insignificant risk of default given the standing and funding of these registered providers.
f. Capital management
The Group defines total capital as equity plus net debt where net debt is calculated as total borrowings less cash and
cash equivalents.
The Group monitors capital on the basis of the level of returns achieved on its capital base and, with respect to its
financing structure, the gearing ratio. This is defined as net debt divided by equity.
The Group’s objective in managing capital is to safeguard its ability to continue as a going concern in order to deliver
value to its Shareholders and other stakeholders. The Group operates within policies outlined by the Board in order to
maintain an appropriate funding structure. The Board keeps the Group’s capital structure under review.
The total capital levels and gearing ratios as at 2 July 2023 and 3 July 2022 are as follows:
Total borrowings
Less cash and cash equivalents
Equity
Total capital
Operating profit before exceptional items
ROCE (Operating profit as above as a percentage of opening and closing total capital)
Gearing ratio
The Company has cash and cash equivalents of £238m (2022: £285m).
g. Fair values
Basis for determining fair values
2023
£M
–
(235)
(235)
2,026
1,791
399
2022
£M
–
(288)
(288)
1,950
1,662
414
23.11%
24.54%
N/A
N/A
The principal methods and assumptions used in estimating the fair value of financial instruments can be found in the
Accounting Policies page 218.
Fair value hierarchy
Financial assets and liabilities carried at fair value are categorised within the hierarchical classification of IFRS13:
• Level 1: Quoted prices 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 or indirectly.
• Level 3: Inputs are not based on observable market data.
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242
Redrow plc Annual Report 2023Redrow plc Annual Report 2023Financial statementsFinancial statements
Notes to the financial statements / continued
1 5 . F I N A N C I A L R I S K M A N AG E M E N T C O N T I N U E D
g. Fair values continued
The carrying value of financial assets and liabilities of the Group and Company approximate to their fair value, thus no
fair value hierarchy is disclosed.
The Group
Assets per the balance sheet
Trade receivables, contract assets and other receivables
Cash and cash equivalents
2023
2023
LOANS AND
RECEIVABLES
FAIR VALUE
£M
LOANS AND
RECEIVABLES
CARRYING
VALUE
£M
2022
LOANS AND
RECEIVABLES
FAIR VALUE
£M
2022
LOANS AND
RECEIVABLES
CARRYING
VALUE
£M
37
235
272
37
235
272
70
288
358
70
288
358
2023
OTHER
FINANCIAL
LIABILITIES
FAIR VALUE
£M
2023
OTHER
FINANCIAL
LIABILITIES
CARRYING
VALUE
£M
2022
OTHER
FINANCIAL
LIABILITIES
FAIR VALUE
£M
2022
OTHER
FINANCIAL
LIABILITIES
CARRYING
VALUE
£M
Liabilities per the balance sheet
Bank loans and overdrafts
Trade payables and other payables including customer deposits
Land creditors
Lease liabilities
Other financial liabilities are at amortised cost.
The Company
–
468
272
10
750
–
468
272
10
750
2023
2023
LOANS AND
RECEIVABLES
FAIR VALUE
£M
LOANS AND
RECEIVABLES
CARRYING
VALUE
£M
2022
LOANS AND
RECEIVABLES
FAIR VALUE
£M
2022
LOANS AND
RECEIVABLES
CARRYING
VALUE
£M
Assets per the balance sheet
Cash and cash equivalents
Amounts due from subsidiary companies (current and non-current)
Liabilities per the balance sheet
Bank loans and overdrafts
Amounts owed to subsidiary companies
244
238
977
1,215
238
977
1,215
285
583
868
285
583
868
2023
OTHER
FINANCIAL
LIABILITIES
FAIR VALUE
£M
2023
OTHER
FINANCIAL
LIABILITIES
CARRYING
VALUE
£M
2022
OTHER
FINANCIAL
LIABILITIES
FAIR VALUE
£M
2022
OTHER
FINANCIAL
LIABILITIES
CARRYING
VALUE
£M
–
14
14
–
14
14
–
14
14
–
14
14
–
530
376
6
912
–
530
376
6
912
Private customer deposits and social customer payments on account are accounted for as contract liabilities under
IFRS15.
Amounts due to subsidiary companies are unsecured, repayable on demand and bear interest at market rate on trading
balances. Amounts due in respect of development land are classified as current when they are contractually due within
12 months of the balance sheet date.
1 6 . T R A D E A N D OT H E R PAYA B L E S
Non-current liabilities
Amounts due in respect of development land
Lease liabilities
Current liabilities
Trade payables
Amounts due in respect of development land
Private customer deposits
Social customer payments on account
Amounts owed to subsidiary companies
Lease liabilities
Other payables
Other taxation and social security
Accruals
G RO U P
CO M PA N Y
2023
£M
98
6
104
400
174
36
21
–
4
7
4
104
750
2022
£M
2023
£M
2022
£M
87
4
91
385
289
87
48
–
2
5
5
93
914
–
–
–
–
–
–
–
14
–
–
–
–
14
–
–
–
–
–
–
–
14
–
–
–
– †
14
1 7. P R OV I S I O N S
The Group
At 3 July 2022
Provisions created during the year
Provisions released during the year
Provisions utilised during the year
At 2 July 2023
Current provisions
Non-current Long term provisions
LEGACY FIRE
SAFETY
PROVISION
£M
ONEROUS
CONTRACTS
£M
OTHER
£M
TOTAL
£M
200
32
(32)
(12)
188
1
–
–
–
1
6
–
–
–
6
2023
£M
107
88
195
207
32
(32)
(12)
195
2022
£M
97
110
207
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Notes to the financial statements / continued
1 7. P R OV I S I O N S C O N T I N U E D
Legacy fire safety provision
The Group holds a provision of £188m (2022: £200m) in respect of legacy fire safety remediation. As outlined in the 2022
Annual Report, in April 2022 the Group signed the Government’s Building Safety Pledge in respect of funding of
remediation of life critical fire safety issues on buildings over 11m in which the Group was involved in going back 30 years.
On 30 January 2023 Michael Gove announced the publishing of the self remediation terms (SRT) which follows on from
the signing of the Building Safety Pledge last year. Redrow signed this SRT on 13 March 2023 and the Welsh version on
18 April 2023. This SRT widened developers’ responsibilities regarding potential remediation work which may need to be
undertaken notably to include communal internal areas and for all buildings over 11m to be risk assessed regardless of
EWS1 (External Wall Fire Review) status.
The legacy fire safety provision reflects management’s best estimates of the cost of works outstanding to complete the
remediation of all identified buildings within scope to the standard outlined in the SRT including the reimbursement of
funds to the Build Safety Fund (BSF) as appropriate. Prior year provisions represented Management’s best estimate of
the liability based on the information available at the time in relation to the obligations at the time. In estimating the cost
of the works for calculating the provision at 2 July 2023, Management has used the latest BSF cost information shared
with Redrow, taken into account the cost of contracts Redrow has placed and tenders received together with input from
external cost consultants with respect to estimated external and internal remediation costs per plot. Management
classified buildings as in scope according to a risk assessment across 6 risk categories used in reporting to DLUHC
including their EWS1 status. c£68m of the provision is related to known BSF amounts awarded.
However, these estimates are inherently uncertain and may change over time as this is a highly complex area involving
bespoke buildings for which assessments and investigations are at varying stages across the building population in
scope depending on risk prioritisation and will therefore be ongoing for some time. Please see Note 1 for further
information on key sources of estimation uncertainty.
It is expected that £107m of the provision will be utilised over the next 12 months and the remainder over the following
four years although these timescales may change depending on the progress of the remediation work for the building
population and timing of BSF reimbursement requests.
Provisions are discounted to net present value where the effect is material.
1 9. S H A R E C A P I TA L , S H A R E P R E M I U M AC C O U N T A N D R E S E R V E S C O N T I N U E D
The Group continued
Other reserves
Other reserves consists of a £9m Capital redemption reserve (2022: £7m) and a £1m Consolidation reserve (2022: £1m).
Undistributable reserves
Other reserves are not available for distribution.
The Company
At 27 June 2021
Total comprehensive income
Dividends paid
Other LTIP/DB/SAYE credit
At 3 July 2022
Total comprehensive income
Dividends paid
Net purchase of own shares arising from share buyback programme
Other LTIP/DB/SAYE credit
At 2 July 2023
Other reserves
SHARE
CAPITAL
£M
SHARE
PREMIUM
ACCOUNT
£M
OTHER
RESERVES
£M
RETAINED
EARNINGS
£M
37
–
–
–
37
–
–
(2)
–
35
59
–
–
–
59
–
–
–
–
59
7
–
–
–
7
–
–
2
–
9
878
(1)
(100)
4
781
524
(108)
(100)
6
1,103
Other reserves consists of a £9m Capital redemption reserve (2022: £7m) with the increase in the year reflecting the
cancellation of shares purchased as part of the share buyback programme.
1 8 . S H A R E C A P I TA L
As at 3 July 2022 (ordinary shares of 10.5p each)
Purchased and cancelled in share buyback programme
As at July 2023 (ordinary shares of 10.5p)
NUMBER OF
ORDINARY SHARES
352,190,420
(21,420,175)
330,770,245
Undistributable reserves
Other reserves are not available for distribution.
2 0. M OV E M E N T I N N E T C A S H
The Group
As a consequence of the £100m share buyback programme announced on 14 July 2022 and completed in January 2023,
the Group purchased and subsequently cancelled 21,420,175 ordinary shares. This reduced share capital by £2m,
reduced Retained earnings by £100m and increased the capital redemption reserve by £2m. See note 19.
As at 2 July 2023 10m Redrow plc ordinary shares of 10.5p each are held in trust under the Redrow Long Term Incentive
Plan (3 July 2022: 11m shares).
Cash and cash equivalents
Lease Liabilities
Net cash
AT
3 JULY 2022
£M
NON-CASH
MOVEMENT
£M
CASH FLOW
£M
AT
2 JULY 2023
£M
288
(6)
282
–
(7)
(7)
(53)
3
(50)
235
(10)
225
1 9. S H A R E C A P I TA L , S H A R E P R E M I U M AC C O U N T A N D R E S E R V E S
The Group
Non-cash movement comprises movements in respect of LTIP/SAYE together with relevant IAS19, IFRS7 and IFRS16 non
cash movements.
SHARE
CAPITAL
£M
SHARE
PREMIUM
ACCOUNT
£M
OTHER
RESERVES
£M
RETAINED
EARNINGS
£M
The Company
At 27 June 2021
Total comprehensive income
Dividends paid
Net purchase of own shares to satisfy share options
Other LTIP/DB/SAYE credit
At 3 July 2022
Total comprehensive income
Dividends paid
Net purchase of own shares arising from share buyback programme
Satisfaction of share options from treasury shares
Other LTIP/DB/SAYE credit
246
At 2 July 2023
37
–
–
–
–
37
–
–
(2)
–
–
35
59
–
–
–
–
59
–
–
–
–
–
59
8
–
–
–
–
8
–
–
2
–
–
1,768
196
(100)
(22)
4
1,846
276
(108)
(100)
2
6
10
1,922
Cash and cash equivalents
Lease Liabilities
Net cash
2 1 . C O N T I N G E N T L I A B I LI T I E S
AT
3 JULY 2022
£M
NON-CASH
MOVEMENT
£M
CASH FLOW
£M
AT
2 JULY 2023
£M
285
–
285
–
–
–
(47)
–
(47)
238
–
238
The Company has guaranteed the bank borrowings of its subsidiaries. Performance bonds and other building or
performance guarantees have been entered into in the normal course of business. Management estimate that the bonds
and guarantees amount to £158m (2022: £158m) at the year end and consider the possibility of a cash outflow in
settlement to be remote.
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Financial statements
Notes to the financial statements / continued
2 2 . R E L AT E D PA R T Y T R A N S AC T I O N S
Full year dividend per share
Within the definition of IAS 24 ‘Related party disclosures’,
the Board and key management personnel are related
parties. Detailed disclosure of the remuneration of the
Board is given in the Directors’ Remuneration Report on
pages 166 to 191 notably the 'Single Total Figure of
Remuneration Table (Audited)' on page 182. A summary of
remuneration provided to key management personnel is
provided in note 7c.
There have been no other material related transactions
with key management personnel.
The Company funds the operating companies through both
equity investment and loans at commercial rates of
interest. In addition, the Company provides its subsidiaries
with the services of Senior Management, for which a
recharge is made to those subsidiary companies based
upon utilisation of services.
The amount outstanding from subsidiary undertakings at 2
July 2023 was £977m (3 July 2022: £583m). The amount
owed to subsidiary undertakings at 2 July 2023 was £14m
(3 July 2022: £14m).
The Company provided the Group’s defined benefit
pension scheme, as detailed in note 7e. Expected service
costs were charged to the operating businesses at cost.
There is no contractual arrangement or stated policy
relating to the charge. Experience and actuarial gains are
recognised in the Company, via the Statement of
Comprehensive Income.
2 3 . A LT E R N AT I V E P E R F O R M A N C E M E A S U R E S
Redrow uses a variety of Alternative Performance
Measures (APMs) which are not defined or specified by
IFRSs but which the Directors believe are pertinent to
reviewing and understanding the broader performance of
the Group, in conjunction with IFRS defined measures.
Annual Injury Incidence Rate (AIIR)
No. of RIDDOR Accidents resulting in an injury divided by
the average number of people employed multiplied by
100,000 (see ESG Scorecard on page 252).
Cash conversion percentage
Interim and final dividend per share declared in respect of
the financial year.
HBF customer recommend rating
Independent HBF customer satisfaction rating score.
2 3 . A LT E R N AT I V E P E R F O R M A N C E M E A S U R E S
C O N T I N U E D
Underlying return on capital employed (Underlying ROCE)
Operating profit before exceptional items adjusted for joint
ventures as a percentage of opening and closing capital
employed. See note 15f.
Homes revenue from ongoing business
Underlying return on equity (Underlying ROE)
Revenue per consolidated income
statement
Revenue from the sale of land
(see note 2a)
2023
£M
2022
£M
2,127
2,140
(44)
(21)
Profit before tax before exceptional items adjusted for joint
ventures as a percentage of opening and closing net
assets.
Net assets at 2 July 2023/3 July 2022
2,026
1,950
2023
2022
Revenue from the sale of new housing
(see note 2a)
2,083
2,119
Net assets at 3 July 2022/27
June 2021
Revenue from London Build Out sites
(45)
(52)
Average net assets
Homes revenue from ongoing business
2,038 2,067
Profit before taxation – pre-exceptional
Return on equity %
1,950
1,872
1,988
395
1,911
410
19.9% 21.5%
Hurdle rates
Gross margin and internal rate of return minimum rates
required for land purchase appraisals.
Land holding years
No. of plots in owned land holdings at balance sheet date
divided by no. of legal completions in financial year.
Owned land holdings at
2 July 2023/3 July 2022
Legal completions
Land holding years
2023
2022
26,070
29,600
5,436
4.8
5,715
5.2
Legal completions
The number of homes legally completed in the financial
year.
Monies committed to fund improvements in local
communities
These reflect committed Section 106 contributions and
affordable housing provided in the year.
Revenue value of private reservations secured in the year
The fair value receivable in the future of private house
sales reserved by customers during the year, net of
cancellations.
Sales outlets
Average no. of sales outlets open in the year.
Underlying profit before tax
Profit before tax pre-exceptional item
Underlying earnings per share
As statutory earnings per share but based on
pre-exceptional profit for the year per the consolidated
income statement.
Underlying gross profit
Gross profit per the consolidated income statement
pre-exceptional item.
Underlying operating profit
Operating profit per the consolidated income statement
pre-exceptional item.
Cash inflow generated from
operations per statement of cash
flows
Divided by:
Operating profit per consolidated
income statement
Amortisation and depreciation per
note 2b
Cash conversion percentage
2023
2022
Net asset value per ordinary share
Total net assets at balance sheet date divided by the
number of ordinary shares in issue at balance sheet date.
£244m
£318m
Number of trainees
No. of trainees at year end as a percentage of employees
at year end.
£399m £250m
Order book
£4m
£5m
£403m £255m
61%
125%
The value of reserved and exchanged sales which had not
legally completed at the year end.
Private reservation rate
No. of private reservations per week in financial
year divided by average no. of sales outlets.
248
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249
Redrow plc Annual Report 2023
Colindale Gardens,
North London.
Five year summary
FIVE YEAR SUMMARY
12 months ended June
Revenue
Operating profit – pre-exceptional
Operating profit – pre-exceptional as a percentage of
turnover
Profit before tax – pre-exceptional
Net assets
Net cash/(debt)*
Gearing – net debt as a percentage of capital and reserves
Return on capital employed – operating profit before
exceptional items adjusted for joint ventures as a
percentage of opening and closing capital employed
Return on equity
Number of legal completions
Earnings per ordinary share – pre-exceptional
Dividends paid per ordinary share inc cash return
2019
£M
2,112
411
19.5%
406
1,585
124
N/A
28.5%
26.5%
6,443
92.3p
59.0p
2020
£M
1,339
148
11.1%
140
1,626
(126)
7.7%
9.2%
8.7%
4,032
32.9p
–
2021
£M
1,939
321
16.6%
314
1,872
160
N/A
18.5%
18.0%
5,620
73.7p
6.0p
2022
£M
2,140
414
19.3%
410
1,950
288
N/A
24.5%
21.5%
5,715
96.0p
28.5p
2023
£M
2,127
399
18.8%
395
2,026
235
N/A
23.1%
19.9%
5,436
91.2p
30.0p
Net asset value per ordinary share
450.0p
461.7p
531.5p
553.7p
612.5p
* Excluding lease liabilities
250
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ESG hub
ESG SCORECARD
All of the FY23 ESG data contained in this scorecard has been assured at a limited level of assurance according to
ISAE3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information, to
evaluate veracity of the specific KPIs. This has been undertaken by SGS United Kingdom Ltd in accordance with their
Sustainability Report Assurance protocols, including the Global Reporting Initiative (GRI) Principles for Report Quality.
The full Assurance Statement can be found on our corporate website: https://www.redrowplc.co.uk/sustainability/
esg-disclosures/
K P I T H E M E
K P I DATA P O I N T
K P I D E F I N I T I O N
H E A LT H &
S A F E T Y
Annual Injury
Incidence Rate (AIIR)
Number of RIDDOR Accidents resulting in an injury divided by the
average number of people employed1 multiplied by 100,000.
C U S TO M E R
Net promoter score
(NPS)
NPS is a benchmark score that asks customers how likely they are to
recommend a builder to a friend on a scale of 0-10.
HBF survey 8 week
recommend –
customers that would
recommend Redrow to
a friend as a %
This metric is the percentage of customers that have moved into
their home between 8-20 weeks ago that state they would
recommend their builder to a friend in the HBF survey.
HBF 9 months post
occupancy – customer
that would recommend
Redrow to a friend as
%
This metric is the percentage of customers satisfaction rated on the
HBC satisfaction survey completed by owner-occupiers 9 months
after legal completion and state they would recommend their builder
to a friend in the HBF survey.
U N I T
R E P O R T E D
No.
1 2 M O N T H
P E R I O D T H I S
DATA R E L AT E S
TO ( F O R F Y 2 3 )
4 July 2022 to
2 July 2023
F Y 2 3
F Y 2 2
F Y 2 1
TA R G E T
365
365
441*
10% reduction of
incidences year
on year2
R E A D
M O R E
Page 62
50.2
59.3
50.1
Achieve a
minimum NPS
score of 54%
Page 46
90.8
94.5
92.6
Page 47
Consistently
deliver a 91%+
customer
satisfaction rating;
recommend to a
friend (ongoing)
81.10
New for
FY23
New for
FY23
No target set
Page 47
%
%
%
1 October 2021
to 30
September
2022 (results
published
annually for
this period in
following
March)
1 October 2021
to 30
September
2022 (results
published
annually for
this period in
following
March)
1 October
2020 to 30
September
2021 (results
published
annually for
this period in
following
March) 3
Average Trustpilot
Review Score
This score is a mean average of every review received on Redrow’s
Trustpilot page during the reporting period. When reviewing Redrow
on Trustpilot, customers choose a rating between 1 – 5 stars.
No. 1 – 5
stars
4 July 2022 to
2 July 2023
4.49
4.45
4.54
Excellent (4.3 or
above)
Page 46
1
2
‘People Employed’ refers to the average number of people employed at any one time across Redrow Offices, Sites, Sales and Customer Services including both
employees and engaged sub-contractors. As defined by the Health and Safety Executive.
In FY2023 AIIR has remained static at 365.
252
3 Survey sent to customer 9 months post completion. The figures shown are for homes sold within stated period in 2020/21.
* Figure not verified by SGS.
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ESG hub / continued
K P I T H E M E
K P I DATA P O I N T
K P I D E F I N I T I O N
B U I L D Q UA L I T Y
A N D
C O N S I D E R AT E
C O N S T R U C T I O N
Average Considerate
Constructors Scheme
(CCS) score
This KPI demonstrates an average score, out of 50, from all visits
carried out by the CCS, where a report is received, in the reporting
period.4
U N I T
R E P O R T E D
No. out of 45
1 2 M O N T H
P E R I O D T H I S
DATA R E L AT E S
TO ( F O R F Y 2 3 )
4 July 2022 to
2 July 2023
F Y 2 3
39.5
F Y 2 2
38.43
F Y 2 1
36.67
R E A D
M O R E
Page 64
TA R G E T
Achieve a
minimum CCS
score of 33/45 on
all sites in FY23
NHBC Construction
Quality Review (CQR)
average score per
inspection
The average score (1-6) taken from all scored areas within a CQR
report. This KPI demonstrates the average score, out of 6, from all
CQR visits carried out by the NHBC in the reporting period. The CQR
visits are only applicable to sites that are registered with the NHBC
for Building Control and Warranty.5
NHBC Construction
Quality Review (CQR)
Group average score
The average score stated as a % taken from all scored areas within a
CQR report. This KPI demonstrates the average score as a
percentage from all CQR visits carried out by the NHBC in the
reporting period. The CQR visits are only applicable to sites that are
registered with the NHBC for Building Control and Warranty.
Average Reportable
Items (RIs) from the
NHBC
The Average RI is the number of all of the RIs received within the
period divided by the number of inspections carried out on all sites
registered with the NHBC. An NHBC RI is any contravention of the
NHBC technical standards or building regulations recorded at any
key build stage or frequency visit.6
No. 1-6
4 July 2022 to
2 July 2023
4.56
4.44
4.36
Achieve a score
of 4.5/6 in FY23
Page 65
%
No.
4 July 2022 to
2 July 2023
87
New for
2023
New for
2023
Achieve a score of
82% in FY23
Page 65
4 July 2022 to
2 July 2023
0.19
0.17
0.22
Achieve ≤0.15
reportable items
per inspection
Page 46
4
5
6
254
Covers 100% of Redrow sites. A site is registered with the CCS once Redrow take over as Principal Contractor.
This covers NHBC 203 site inspection reports received from the NHBC in the reporting period. Excludes Greater London sites, two in the Northwest, two in Lancashire
and one in South Midlands as these are not registered with the NHBC.
This covers only sites registered with the NHBC. Excludes Greater London sites, two sites in the Northwest, two in Lancashire and one in South Midlands as these are
not registered with the NHBC.
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K P I T H E M E
K P I DATA P O I N T
K P I D E F I N I T I O N
E M P LOY E E S
Overall engagement
score
Overall engagement score taken from annual survey report provided
by Employee Feedback Ltd.7
Employee turnover
rate
% of employees who leave the business in the year through
voluntary attrition (resignation or retirement).
Number of internal
promotions
Number of internal promotions during the financial year.
% of direct employees
that are trainees
% of employees who are apprentices, graduate trainees or following
a training programme, academic or professional qualification.
Total number of
training days delivered
Total number of training hours delivered as face to face, e-learning
or online seminars during the financial year, divided by 6 hours to
give a number of training days.
AND
AND
Average number of
training days per
employee
The average figure is obtained by dividing the total number of
training days by the average number of employees in the business
during the year.
7
8
256
The questions in the engagement index measure two factors important to employee engagement – are employees capable of high levels of performance and are they
willing / keen to deliver? Similar sets of questions are used to determine other organisations’ engagement indices. The survey covered those employees who are paid
monthly representing 80% of the total workforce.
Whilst we have seen an 16% increase in training days in FY2023 (5,591) from those reported in 2022 (4,819) this is still below our 2020 figure (5,925), the reason being
we have continued with the use of e-learning and seminars to support our face-to-face training and these online sessions tend to be shorter in duration.
1 2 M O N T H
P E R I O D T H I S
DATA R E L AT E S
TO ( F O R F Y 2 3 )
Measurement
taken from
annual
employee
survey carried
out February
2023
4 July 2022 to
2 July 2023
F Y 2 3
F Y 2 2
F Y 2 1
TA R G E T
R E A D
M O R E
84
83
82
Maintain at 80%+
Page 80
15.23
19.4
14.3
N/A
Page 80
4 July 2022 to
2 July 2023
235
261
211
N/A
Page 80
U N I T
R E P O R T E D
%
%
No.
%
15.9
15
14.5
Measurement
taken as at
year end date
of June 2023
No. of days
4 July 2022 to
2 July 2023
5,5918
4,819
4,083
2.52
2.19
1.81
15% of all
employees being
trainees
Page 68
Invest in at least 3
training days per
employee per year
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K P I T H E M E
K P I DATA P O I N T
K P I D E F I N I T I O N
D I V E R S I T Y A N D
I N C LU S I O N
% who identify as
Ethnic minorities
% of self-reporting who identify as Ethnic minorities.9
% of apprentices who
identify as Ethnic
minorities
% of female employees
– Overall and by
management category:
% of apprentices self-reporting who identify as Ethnic minorities.10
% of Female
employees -
Overall and by management
category:
All employees
% of female employees overall.
Executive
Management Team
Main Board (includes
non-executives)
% of female employees on Executive Management Team.
% of female employees on Main Board.
Executive
Management Team
Reportees
% of female employees as Direct Reports to Executive Management
Team (excluding PAs and those reporting to CEO who are also on
the Executive Management Team).
Senior Management
% of female employees within the Senior Management population.
Female graduates
recruited
% of employees who are apprentices, graduate trainees or following
a training programme, academic or professional qualification.
U N I T
R E P O R T E D
%
%
%
%
1 2 M O N T H
P E R I O D T H I S
DATA R E L AT E S
TO ( F O R F Y 2 3 )
Measurement
taken as at 2
July 2023
Measurement
taken as at 2
July 2023
Measurement
taken as at 2
July 2023
F Y 2 3
F Y 2 2
F Y 2 1
TA R G E T
7.02
6.64
5.14
N/A
R E A D
M O R E
Page 72
10.55
10.67
N/A – New
KPI in
FY2022
12.5% by 2025
Page 72
N/A
Page 160
33.85
34.17
34.06
34.06%
33.33
33.33
25
25%
50
33.33
28.57
28.57%
22.22
28.57
27.27
27.27%
25.28
25.41
Measurement
taken as at 2
July 2023
33.33
28.57
28% by 2025
40% by 2025
N/A – New
KPI in
FY2022
N/A – New
KPI in
FY2022
9
This KPI and definition has changed from BAME to Ethnic minorities in FY 2022 to align with current government guidance. Gov.uk defines ‘Ethnic minorities’ as all
ethnic groups except the white British group. Ethnic minorities include white minorities, such as Gypsy, Roma and Irish Traveller groups. This is based on 93% (92% in
FY 2022) of employees who have self-reported ethnicity information.
258
10
This is the second year we have reported 'apprentice ethnicity' information and can confirm it is based on 99.5% of our total apprentice population who self-reported
this information.
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K P I T H E M E
K P I DATA P O I N T
K P I D E F I N I T I O N
C A R B O N &
E N E R GY
Group GHG emissions
Scope 1 and 2 –
Market Based
Total Market Based Scope 1 and 2 GHG emissions from our
operations (sites and offices).
Total GHG emissions
per 100m2 of build
– Market Based
Operational energy
use
% of electricity
procured from
renewable sources
GHG emissions normalised per 100m2 of build (Market Based).
Total energy and fuel consumption used from sites and offices.
Percentage of electricity used in our operations that is sourced from
renewable sources.
U N I T
R E P O R T E D
1 2 M O N T H
P E R I O D T H I S
DATA R E L AT E S
TO ( F O R F Y 2 3 )
Tonnes of
CO2e
1 July 2022 to
30 June 2023
Tonnes of
CO2e/
100m2
1 July 2022 to
30 June 2023
kWh
%
1 July 2022 to
30 June 2023
1 July 2022 to
30 June 2023
Group GHG emissions
Scope 3
Total Market Based Scope 3 GHG emissions from our value chain.
Tonnes of
CO2e
1 July 2022 to
30 June 2023
Total scope 3 GHG
emissions per 100m2
of build
GHG emissions normalised per 100m2 of build (Market Based).
Tonnes of
CO2e/
100m2
1 July 2022 to
30 June 2023
F Y 2 3
F Y 2 2
F Y 2 1
TA R G E T
8,318
9,822
16,099
To reduce our
absolute Scope 1
and 2 GHG
emissions by 42%
by FY30, from our
FY21 base year
R E A D
M O R E
Page 195
1.67
1.75
3.11
N/A
Page 195
44,003,874
53,788,513
64,294,472
N/A
Page 195
87.96
96.03
3.30
Page 52
Purchase 100%
REGO-backed
renewable
electricity for all
operations (offices
and construction
sites) by the end
of FY24
Verified
FY23 data
not yet
available
Verified
FY23 data
not yet
available
1,073,070
1,011,279
New for 2023 –
no target set
Page 54
191.11 *
195.61 *
New for 2023 –
no target set
Page 54
260
* Figure not verified by SGS.
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K P I T H E M E
K P I DATA P O I N T
K P I D E F I N I T I O N
S U S TA I N A B LE
H O M E S 1 1
Average SAP rating
The average as built SAP rating12 for legally completed units in the
financial year.
U N I T
R E P O R T E D
No. 1-100
1 2 M O N T H
P E R I O D T H I S
DATA R E L AT E S
TO ( F O R F Y 2 3 )
F Y 2 3
F Y 2 2
F Y 2 1
TA R G E T
4 July 2022 to
2 July 2023
85
85
B
N/A, new
KPI in FY22
N/A
N/A, new
KPI in FY22
N/A, new
KPI in FY22
N/A
N/A
Average EPC rating
The average as built EPC rating 13 for legally completed units in the
financial year.
A-G rating
4 July 2022 to
2 July 2023
B
Average DER
The average Dwelling Emission Rate (DER)14 is the actual CO2
emission rate of self-contained dwellings and individual flats
(excluding common areas) based on the actual as built specification.
Kg/CO2/
m²/year
4 July 2022 to
2 July 2023
15.63
15.75
R E S O U R C E
E F F I C I E N C Y
Tonnes of construction
waste per 100m2 build
Construction waste produced per 100m2 of build.
Tonnes of
waste/
100m2
1 July 2022 to
30 June 2023
8.82
7.91
8.11
% of construction
waste diverted from
landfill
The % of waste which is diverted from landfill. This includes refuse
derived fuel (RDF) as well as recycling.
%
1 July 2022 to
30 June 2023
98.29
98.34
97.65
Reduce
construction
waste intensity by
10% by the end of
FY25 against 2021
baseline
95%+ of
construction
waste diverted
from landfill
Water use per 100m2
build
Cubic metres of water used in our sites and offices per 100m2 of
build.
m3 per
100m2 build
1 July 2022 to
30 June 2023
29.93
26.53
33.06
N/A
Page 59
% of timber certified
% of timber responsibly sourced and credibly certified to FSC or
PEFC.15
%
1 January 2022
to 31
December
2022
99.92
99.98
99.64
100% of timber
responsibly
procured
Page 61
11
12
13
The SAP, EPC and DER ratings relate to 100% (5,236) as built legally completed units in FY2023. This figure excludes the legally completed units at the Royal Docks
Partnership, where data was not available at the time of collection.
The Standard Assessment Procedure (SAP) is the methodology used by the Government to assess and compare the energy and environmental performance of
dwellings. SAP quantifies a dwelling’s performance in terms of energy use per unit floor area, a fuel-cost-based energy efficiency rating (the SAP rating) and emissions
of CO2 (the Environmental Impact Rating). The SAP rating is expressed on a scale of 1 to 100, the higher the number the lower the running costs. Source: https://www.
bre.co.uk/filelibrary/SAP/2012/SAP-2012_9-92.pdf
Energy performance certificates (EPCs) set out the energy efficiency rating of a building. They are required when buildings are built, sold or rented. Buildings are
rated from A to G, with A representing a very efficient building and G a very inefficient building. Source: https://www.gov.uk/buy-sell-your-home/energy-performance-
certificates.
262
14
15
The Dwelling Emission Rate is equal to the annual CO2 emissions per unit floor area for space heating, water heating, ventilation, and lighting, less the emissions saved
by energy generation technologies, expressed in Kg/CO2/m²/year. Source: SAP Methodology
Prior to FY2021, our timber was verified as part of the WWF network for responsible timber and includes legal timber. In FY2023, the verified figure covers only timber
certified to FSC or PEFC.
R E A D
M O R E
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K P I T H E M E
K P I DATA P O I N T
K P I D E F I N I T I O N
S U P P LY C H A I N
– PAY M E N T S O N
T I M E 1 6
Average time taken to
pay invoices
The average time taken to pay supplier invoices and sub-contractor
applications from the date of receipt .
U N I T
R E P O R T E D
days
1 2 M O N T H
P E R I O D T H I S
DATA R E L AT E S
TO ( F O R F Y 2 3 )
4 July 2022 to
2 July 2023
F Y 2 3
F Y 2 2
23.1
23.1
F Y 2 1
23.5
Invoices paid within 30
days
Percentage of invoices and applications paid during the reporting
period within 30 days.
S U P P LY C H A I N
– M O D E R N
S L AV E RY
% of Material suppliers
and manufacturers
who have actively
confirmed compliance
with the Modern
Slavery legislation and
Redrow Code of
Conduct
% of ‘temporary labour
suppliers’ who have
actively confirmed
compliance with the
Modern Slavery
legislation and Redrow
Code of Conduct
All Suppliers and Manufacturers must submit a detailed Supplier
Appraisal Assessment for approval as part of our pre-tender
qualification process. We have updated the appraisal forms to track
the country of manufacture allowing us to identify materials supplied
by manufacturers with a high risk profile.
All suppliers of agency/temporary labour staff working on our sites
are monitored for compliance by an external organisation named
Datum RPO.
%
%
%
4 July 2022 to
2 July 2023
83.30
81.2
79.1
4 July 2022 to
2 July 2023
100
96
100
Aim for 100%
compliance
Page 82
4 July 2022 to
2 July 2023
100
100
100
Aim for 100%
compliance
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M O R E
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TA R G E T
N/A – Signed up
to Prompt
Payment Code
and report data to
HMRC 6 monthly
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N/A – Signed up
to Prompt
Payment Code
and report data to
HMRC 6 monthly
264
16
All ‘Payments on time’ KPIs cover 100% of Suppliers and Sub-contractors
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OPERATIONAL FRAMEWORK
FY24
P U R P O S E
P I LL A R
P R O G R A M M E
U N S D G
O B J E C T I V E
B U S I N E S S D R I V E R
2 02 4
2 02 5
2 0 3 0
TA R G E T S
O
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Nature for People
SDG15
Better Places to
Live
SDG11
Positive Social
Impact
SDG11
Putting nature, people
and wellbeing at the
heart of our
developments.
Create beautiful,
sustainable and
inclusive places for
wellbeing.
Create positive
outcomes and making
a difference to the
communities within
which we develop.
Safe by Design &
Operating
Responsibly
SDG8
Integrate health,
safety and
environment into
everything we do.
Putting Our
Customers First
Consistently deliver
high quality, efficient
homes for our
customers.
E
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P
O
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P
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W
R
E
T
T
E
B
A
E
T
A
E
R
C
O
T
Enhancing nature is essential to
the design of our developments
and makes them more attractive
communities in which to live.
• 100% of planning
applications with at
least 10% BNG
Delivering a better quality of life
makes our places as attractive as
possible for our customers.
Making a positive impact
demonstrates the benefits that
our developments deliver to local
communities and improves
relationships.
We do not pursue this aim simply
to comply with legislation; we do
it because we know it significantly
contributes to our overall
business performance and
protects our people. This
responsibility extends to the
communities we work in.
We want our customers to be
delighted with every aspect of the
homes and services we offer.
• 100% post completion
audit conducted on
completed
developments
• Carry out a Social Value
gap analysis to inform
social value strategy
development and a
social value summary
on a completed project
by June 2024
• 10% year on year
reduction in Annual
Injury Incidence Rate
• 100% sites registered to
the Considerate
Constructors Scheme
• Average CCS score at
least 35/45
• Net Promoter score of
54%
• Customer Satisfaction
rating (recommend to a
friend) 91%
• Average Trustpilot
Score 4.3
• 0.25 or less red
reportable items per
NHBC inspection
• NHBC CQR Group
Average Score of 86%
or more
Resource
Efficiency and
Climate Change
SDG12 and SDG13
Transition to a low
carbon and more
efficient business and
deliver zero-carbon
ready homes.
Reducing our impact on the
environment meets legal
requirements, contributes to the
wider need to achieve net zero
carbon and maintains our
standing with stakeholders.
• 95%+ waste recycled
• 100% timber FSC or
PEFC certified
• 10% reduction in waste
per 100m2 construction
build
• 42% reduction in Scope
1 and 2 emissions
• 11.1% reduction in Scope
• 100% renewable energy
used in offices and sites
by end of 2024
• 100% Electric car fleet
3 emissions
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P U R P O S E
P I LL A R
P R O G R A M M E
U N S D G
O B J E C T I V E
B U S I N E S S D R I V E R
2 02 4
2 02 5
2 0 3 0
TA R G E T S
E
V
I
L
O
T
E
L
P
O
E
P
R
O
F
Y
A
W
R
E
T
T
E
B
A
E
T
A
E
R
C
O
T
Future Skills
SDG8
Engaging Our
People and
Partners
SDG8
Inspire the next
generation into the
sector and ensuring
our people have the
opportunity to develop
and grow with the
business.
Empower and engage
our people and
partners to deliver on
our purpose.
Diversity, Equality
and Inclusion
SDG5
Create a diverse and
inclusive workplace
that prioritises the
wellbeing of our
people.
To deliver our future business
challenges, we need to attract
and retain the best people and
provide continuous support and
training.
• 15% of all employees
being trainees
• 3 training days per
employee per year
We rely on people both within and
outside our business to deliver
our business objectives. Valuing
our people and partners is critical
to ensuring our relationships
flourish.
• Maintain 80% overall
employee engagement
(taken from annual
survey report produced
by Employee Feedback
Ltd)
• Top 70% of the Supply
Chain (based on spend)
to be using the Supply
Chain Sustainability
School by the end of
2024
Diversity in our workforce
benefits our business through
greater creativity, innovation,
productivity, connection to
customers, reduced staff turnover
and ultimately, delivering our
business purpose.
• 12.25% of apprentices
self-reporting who
identify as ethnic
minorities
• 28% of females
employees with the
Senior management
population
• 40% of females
recruited into graduate
roles during the
financial year
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SUSTAINABILITY ACCOUNTING
STANDARDS BOARD (SASB)
DISCLOSURE TABLE
The following table discloses our performance against the criteria set by the Sustainability
Accounting Standards Board (SASB), an independent not for profit organisation that sets
voluntary standards to guide the disclosure of deemed financially material sustainability
information for specific industries. Our disclosures are based on the specific criteria set out for
Home Builders.
All data relates to financial year 4 July 2022 – 2 July 2023 unless otherwise stated.
Our voluntary SASB disclosures ensure we meet the increasing demands of our investors and
other stakeholders. This is the first year of publication in line with SASB standards and
represents our commitment to quality, decision-useful disclosure and evolution of our sustainability reporting. We are
committed to continuously developing and expanding our SASB reporting.
Wherever possible we have provided equivalent data and explanation. Note ‘plots’ are homes prior to completion which
are equivalent to the SASB term ‘lots’.
AC T I V I T Y M E T R I C S
S A S B M E T R I C /
C R I T E R I A
O U R A P P R OAC H
A N D P E R F O R M A N C E
C O D E
Number of controlled
plots.
Our current land holdings comprised 26,070
as at 2 July 2023.
IF-HB-000.A
N OT E S /
R E F E R E N C E S /
D E F I N I T I O N S
Our current land
holdings is defined
as owned or
controlled (under
contract but does
not include land
under option) with
outline or detailed
planning permission.
Number of homes
delivered.
5,436 homes legally completed (3,948
private homes).
IF-HB-000.B
See page 2.
Number of active selling
communities.
An average of 117 sales outlets open in the
year.
IF-HB-000.C
See page 85.
A sales outlet is
defined as a site
with an outlet that
has at least 1 plot
released and the
outlet has at least 6
plots of any value
that are not reserved
OR the outlet has at
least £1m total worth
of plots not
reserved.
270
AC C O U N T I N G M E T R I C S
S A S B M E T R I C /
C R I T E R I A
O U R A P P R OAC H
A N D P E R F O R M A N C E
C O D E
L A N D U S E A N D E C O LO G I C A L I M PAC T S
Number of (1) lots and
(2) homes delivered on
redevelopment sites.
5,557 (21%) of our current land holdings
were on brownfield land. 1,437 (27%) home
completions were on brownfield land.
IF-HB-160a.1
We estimate 1,080 (20%) home completions
were in areas of high water stress. No
homes were built in areas of Extremely High
Stress.
IF-HB-160a.2
None in the reporting period.
IF-HB-160a.3
N OT E S /
R E F E R E N C E S /
D E F I N I T I O N S
Brownfield land is
the equivalent of
redevelopment land
i.e. previously
developed land.
Using the World
Resources Institute’s
(WRI) Water Risk
Atlas tool, Aqueduct
(https://www.wri.org/
aqueduct).
Number of (1) lots and
(2) homes delivered in
regions with High or
Extremely High
Baseline Water Stress.
Total amount of
monetary losses as a
result of legal
proceedings associated
with environmental
regulations.
Discussion of process
to integrate
environmental
considerations into site
selection, site design,
and site development
and construction.
IF-HB-160a.4
See pages 266, 28,
34 and 35.
Our Operational Framework, Redrow 8
Placemaking Principles, Nature for People
Strategy and land buying and construction
policies and procedures have environmental
commitments, KPIs and processes at the
core of them which deliver a robust
structure for our project teams to use
through each stage of the development
process.
Site selection and acquisition:
All new site acquisitions follow strict
procedures which includes scrutiny of all
environmental risks and opportunities
including:
• Detailed ecological assessments
• Air quality impact
• Land contamination
• Flood risk and mitigation – Flood risk
authorities specify that new
developments must survive a one in
hundred year storm plus 20% – 40%. Our
developments meet and very often
exceed this specification.
• Landscape and visual impact surveys
• Protected sites such as Special Areas of
Conservation, and potential nitrate and
phosphate issues
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S A S B M E T R I C /
C R I T E R I A
O U R A P P R OAC H
A N D P E R F O R M A N C E
C O D E
N OT E S /
R E F E R E N C E S /
D E F I N I T I O N S
S A S B M E T R I C /
C R I T E R I A
O U R A P P R OAC H
A N D P E R F O R M A N C E
C O D E
L A N D U S E A N D E C O LO G I C A L I M PAC T S C O N T I N U E D
L A N D U S E A N D E C O LO G I C A L I M PAC T S C O N T I N U E D
E
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See pages 58, 59
and 64.
See pages 28, 34,
35 and 44.
Discussion of process
to integrate
environmental
considerations into site
selection, site design,
and site development
and construction.
All operational sites identify Critical Site
Environmental Issues and complete a
Pollution Prevention Plan and Waste
Management plan.
As a partner of the Considerate Constructor
Scheme (https://www.ccscheme.org.uk)
since 2018, the scheme provides the Group
with an independent assessment of our
approach to protecting and enhancing the
local environment on each development.
During the year we achieved an overall
average score of 39.5 out of 45. An increase
for the fifth consecutive year. Our site
compounds are energy efficient with the
building fabric B+ rated, PIRs,
thermostatically controlled heating, door
closers, improved windows, rainwater
harvesting and bike racks.
Groundworks materials are managed at site
level and across each division to maximise
the reuse of materials on site. Waste
materials such as hardcore are re-used
where feasible.
W O R K F O R C E H E A LT H & S A F E T Y
(1) Total recordable
incident rate (TRIR) and
(2) fatality rate for (a)
direct employees and
(b) contract employees.
All H&S incidents are measured using the
Annual Injury Incidence Rate (AIIR) metric
which is per 100,000 employees.
The AIIR was 365 in FY23 for both
employees and subcontractors.
There were no fatalities.
IF-HB-320a.1
See page 252.
Discussion of process
to integrate
environmental
considerations into site
selection, site design,
and site development
and construction.
Site design and placemaking:
All sites are sustainably designed using the
Redrow 8 Placemaking Principles which
includes environmental considerations. It
incorporates national policy and guidance
including Manual for Streets, Active Design,
NHS Healthy New Towns, BREEAM
Communities, Trees in Townscapes and
Sustainable Drainage Manual amongst
others.
We are continually reviewing the energy
efficiency of our homes. The average EPC
rating for our homes is B and we are looking
to improve this as we prepare for Future
Homes standards in 2025.
Our Nature for People strategy developed
in partnership with the Wildlife Trust in 2020
(https://www.redrowplc.co.uk/media/
cykfjckt/redrow-wildlife-trust-pdf-brochure-
updated-140322.pdf ) and Landscape
manual ensure designs retain and enhance
existing quality habitats; include
connectivity with habitats outside the
development; and design green and blue
infrastructure with multiple benefits for
people and nature.
The Company has a commitment that each
new planning application must demonstrate
a minimum 10% net gain for biodiversity by
November 2023. This informs the design of
our new developments and enables climate
resilience.
Site development and construction:
All business operations are covered by an
Environmental Management System (EMS)
ISO14001:2015 system. Our EMS helps
prevent pollution and minimise disturbance
to the local community from flood, noise and
dust as well as helping to protect local
biodiversity.
Our Health, Safety and Environment (HS&E)
Managers conduct regular site visits to
assess compliance with our environmental
procedures. All our Site Managers complete
weekly HS&E inspections which include
environmental performance against our
procedures.
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(1) Number of homes
that obtained a certified
HERS® Index Score and
(2) average score.
100% home completions with an energy
efficiency rating of EPC B.
IF-HB-410a.1
See pages 44 and
262.
Average SAP rating of 85.
The Energy
Performance
Certificate (EPC) is
the UK equivalent to
the HERS score.
The SAP rating is an
indication of the
total running cost of
the dwelling
including space
heating, water
heating, ventilation
and lighting. It
doesn’t account for
unregulated energy
such as the
occupants’ use of
electrical
appliances.
Percentage of installed
water fixtures certified
to WaterSense®
specifications.
100% of our Heritage Collection of homes in
the reporting period were designed to a
flow rate of 105 litres/person/day (l/p/d). This
is below building regulations which require
125 l/p/d.
Number of homes
delivered certified to a
third-party multi-
attribute green building
standard.
100% of homes are designed to meet our
Redrow 8 Placemaking Principles which
incorporates standards on connectivity,
sustainable transport and biodiversity .
IF-HB-410a.2
See page 59.
UK Building
Regulations Part G is
the UK equivalent to
WaterSense.
IF-HB-410a.3.
See page 30.
The UK does not
currently have an
established third-
party multi attribute
green building
standard for
residential homes.
274
Description of risks and
opportunities related to
incorporating resource
efficiency into home
design, and how
benefits are
communicated to
customers.
A key part of our long term approach is to
continually review our risks and
opportunities in relation to resource
efficiency in the design of all of the homes
that we build. This forms a key part of our
climate vision which sets out to reduce our
carbon emissions and adapt to a changing
and unpredictable climate.
IF-HB-410a.4.
We have cross departmental working
groups that are established to prepare for
forthcoming regulation changes and to
understand our customer requirements in
greater detail. Examples in the year include
the conclusion of research trials with
customers that had homes fitted with
alternative technology to a standard gas
boiler so we can understand not only how
the technology performs but also the
customer’s experience. We have now
moved to adopt this technology, and
improved fabric efficiency (including
improved insulation, more efficient doors
and windows) as standard in our new
houses from the start of 2023.
During the year, we carried out surveys and
focus group research with customers to
better understand what they want and
expect from new homes, specifically with
regards to energy efficiency and the Future
Homes Standard. This research has helped
us refine our approach to the inclusion and
use of new technology in our homes.
We communicate with our customers
through a variety of methods. We have
Customer Experience Suites to transform
how we interact with customers, right from
their first visit and all the way through to
post-completion. This includes digital
communications which are updated
regularly to ensure a consistent message.
Customers can use our portal to view their
choices, make upgrades and complete their
reservations. We also have demonstration
build show homes that are finished to a key
build stage to show our customers not only
how our homes are built but importantly,
what specification items are included which
help to drive high levels of energy efficiency
that aren’t visible once homes are
completed.
N OT E S /
R E F E R E N C E S /
D E F I N I T I O N S
CDP Climate Score
of C CDP Forests
score of B
Sustainability
Redrow PLC (https://
www.redrowplc.
co.uk/
sustainability/).
See pages 42 to 61.
See pages 102 to 113
for Redrow annual
TCFD report
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C O M M U N I T Y I M PAC T S O F N E W D E V E LO P M E N T S C O N T I N U E D
Number of (1) plots and
(2) homes delivered on
infill sites.
5,557 (21%) of our owned or controlled
landbank plots were on brownfield land.
1,437 (27%) home completions were on
brownfield land.
IF-HB-410b.2
C LI M AT E C H A N G E A DA P T I O N
Number of plots located
in 100-year flood zones.
IF-HB-420a.1
This data is not collected at a Group wide
level. Flood risk assessments are carried
out as part of the site acquisition risk
identification process. We understand the
risk of flooding on each individual site by
working with specialist consultancies who
advise on latest data and mapping tools.
Flood risk is highly regulated through the
planning process. Flood risk authorities may
require a Flood Risk Assessment as part of
a planning application which demonstrates
the proposed development is not impacted
during a one in hundred year rainfall event
with a significant further allowance for
Climate Change, as well showing resilience
during a one in thousand year flood event. It
is also necessary to demonstrate the
development will not negatively impact local
communities in this respect by causing
additional flooding elsewhere.
IF-HB-410b.1
See page 40 which
illustrates some of
the economic, social
and environmental
value we have
created in FY23.
Through our customer facing website we
explain how our homes are water and
energy efficient including the different
types of energy efficiency approach we
offer for customers and how they can save
energy costs and reduce their carbon
footprint. Our places are designed in line
with our biodiversity strategy – Nature for
People. We also provide a digital tool to
customers that advises how they can
reduce their impact on the environment
through using their homes in the most
efficient way.
Our sales teams are supported with a
sustainability toolkit which informs them of
the resource efficiency of our homes such
as smart heating controls, improved
insulation and air tight designs to ensure
homes are warm and efficient. They are also
supported with information about our
placemaking principles and commitment to
supporting nature.
C O M M U N I T Y I M PAC T S O F N E W D E V E LO P M E N T S
Description of how
proximity and access to
infrastructure, service
and economic centres
affect site selection and
development decisions.
We consider the location of every site in
terms of its proximity to public transport,
local facilities and services. Our Redrow 8
placemaking principles requires that we
“seek to build homes in locations where
there is a choice of places to walk to within
a reasonable walking distance” and that
“wherever possible, we will choose
locations that have existing or planned
employment or community facilities within
walking distance”.
Relevant indicators for this reporting period
include:
• 90% of our homes are within 500 metres
of public transport
• 34% of our developments were delivered
with community infrastructure
• We provided £305m towards community
infrastructure and affordable housing
• 1,221 acres of public open space
• 349 trainees, apprentices and graduates
• 1,495 subcontractors supported
• 2,708 suppliers supported
• 15.9% of employees who are apprentices,
graduate trainees or following a training
programme, academic or professional
qualification
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In the UK Brownfield
land would meet the
definition of an infill
site (see IF-HB-
160a.1).
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CORPORATE AND
SHAREHOLDER INFORMATION
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Description of climate
change risk exposure
analysis, degree of
systematic portfolio
exposure, and
strategies for mitigating
risk.
IF-HB-420a.2
See TCFD report
pages 102 to 113.
In 2022 we achieved
a CDP Climate Score
of C and have a
development plan in
place to instigate
improvements on
this.
We have had our
near-term net zero
targets validated by
Science Based
Targets Initiative
(SBTi) and setting
our Net Zero carbon
target currently with
submission to be
made to the SBTi
prior to the end of
2023.
Climate Change is a key risk identified for
the business. The Group Communities
Director has direct management
responsibility for climate related matters
and sits on the Executive Management
Team with the Group Chief Executive who
has ultimate responsibility for these matters.
The Group Communities Director, with the
support of the sustainability department,
assists and advises the Placemaking and
Sustainability Committee and Main Board in
its development and monitoring of the
Company’s strategy on climate change.
We are in our fourth year of reporting in line
with the recommendations made by the
Task Force for Climate-related Financial
Disclosures (TCFD) which sets out our
strategy on determining climate related
risks and opportunities and governance of
these matters. We have undertaken an
identification and prioritisation process of
climate related risks and opportunities and
these have been qualitatively prioritised by
potential financial impact in the short,
medium, and long-term outlook under
current operating conditions. Financial
quantification was undertaken with support
from external climate advisors and a report
prepared for the Main Board. This
assessment will be reviewed annually as
part of the annual risk review process and
updated in response to a changing
operating context and findings from
scenario analysis activities.
S H A R E H O L D E R D I S C O U N T S
G R O U P C O N TAC T S – O F F I C E R S A N D A DV I S E R S
The Company offers a discount of 1% to Shareholders off
the purchase price of a new Redrow home. In order to
qualify for the discount a purchaser must hold a minimum
of 2,500 ordinary shares in Redrow plc for a minimum of 12
months prior to the date of reservation, subject to a cap of
£5,000.
Company Secretary
Graham Cope
Registered Office
Redrow House
St. David’s Park
Flintshire
CH5 3RX
Registered Number 2877315
redrowplc.co.uk
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