Annual Report 2008 in PDF - GKN

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40 Business Review The GKN Way How we sustain and develop our business For 250 years certain characteristics have been common to the way GKN operates: a culture of continuous improvement, a focus on technology, development of our people and, underpinning these, fundamental and enduring values which extend beyond the purely commercial aspects of our activities. Today we call them the GKN Way. GKN plc Annual Report 2008
Living the Values GKN is a group of 40,000 people from many different locations around the world, with diverse backgrounds and differing experience. The GKN Way brings them all together with a common global approach to the way we sustain and develop our business. It encompasses a culture of continuous improvement, a focus on technology, development of all our people to raise their capability and, at its heart, the GKN Values. The Values govern our relationships with all our stakeholders whether they are shareholders, employees, customers, suppliers or the communities in which we operate. They are underpinned by the GKN Code which, together with a series of underlying policies, provides a framework for the behaviour of all our employees whatever their job and wherever they are located. The GKN Code is designed to ensure that our business in all its aspects continues to be run in an ethical, socially responsible and sustainable manner. (The Code Principles are shown in yellow text throughout this review.) Although only formally launched in 2006, there are many examples throughout our 250 year history of the application of the Code’s principles in the conduct of our business. Some historical and some recent examples are provided throughout this review. All the recent examples are winners of 2008 Group Excellence awards. The awards encourage a culture of continuous improvement in everything we do and recognise truly outstanding performance across our business. In the beginning . . . Conducting our business with integrity We will comply with all relevant laws and regulations wherever we operate and conduct our business with integrity and in such a manner as to reinforce our reputation. Our ethical standards policy requires all employees to maintain the highest standards of integrity, honesty and fair dealing. We support the Universal Declaration of Human Rights and do not tolerate the use of child labour or forced labour in our own operations and, through our supplier management policy, we require equivalent standards through our supply chain. We will continue to reinforce our reputation through high standards of conduct to underpin shareholder value. Working with our suppliers We will deal honestly and fairly with our suppliers and subcontractors. Our suppliers play an integral part in the sustainability of our business and it is essential that they conduct their business in a manner that supports our commitment to world class performance. Our supplier management policy encourages Group companies to develop and maintain value adding relationships with our supply base. It prohibits companies from engaging suppliers that offer inadequate health and safety standards for employees, infringe internationally accepted standards of workers’ rights, use child or forced labour, adopt unsound environmental practices, have poor standards of social responsibility or that fail to comply with relevant laws and regulations. In the current difficult trading conditions we are closely monitoring the financial health of our suppliers to ensure that we are aware of any significant issues and can provide assistance where appropriate. In 1859, the Dowlais Iron Co. completed construction of Goat Mill, the world’s most powerful rolling mill. This enabled the company to mass-produce rails up to 70 ft in length without impacting quality. . . . more recently A GKN Driveline team of torque technology specialists demonstrated excellent global cross-functional customer service in designing and developing a new low cost all wheel drive system for Renault’s H79 programme which has been proven to outperform previous off the shelf products. Customer satisfaction was demonstrated by the award of follow on business on other all wheel drive programmes. (Customer Service Excellence award) GKN Driveline’s plant in Cheonan, South Korea, improved its quality performance significantly over the period 2006 to 2008 achieving 22 consecutive months with no quality concerns or complaints from customers. This represents a world class performance and is a model for all other GKN plants. (Product Quality Excellence award) Business Review The GKN Way www.gkn.com 41
Page 1 and 2: GKN plc Annual Report and Accounts
Page 3 and 4: Our Objective GKN is committed to p
Page 5 and 6: 2008 Performance* Group results sig
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Page 9 and 10: Constant velocity joints (CVJs) rev
Page 11 and 12: Off-highway driveshaft Blended wing
Page 13 and 14: Strategy and business objectives Th
Page 15 and 16: Operating cash flow performance of
Page 17 and 18: Restructuring and impairment costs
Page 19 and 20: 2008 2007 Tax charge analysis % % W
Page 21 and 22: Overseas pensions The principal cou
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Page 25 and 26: GKN Driveline manufactures across a
Page 27 and 28: 2008 2007 GKN Driveline £m £m Sal
Page 29 and 30: Continuing evolution of powder meta
Page 31 and 32: Despite a £6 million positive impa
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Page 35 and 36: Trading profit of subsidiaries of
Page 37 and 38: In January 2009 GKN completed the a
Page 39 and 40: Divisional strategy GKN Aerospace
Page 41 and 42: Financing The following section des
Page 43: Competitive markets and competition
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Page 57 and 58: Dividend An interim dividend of 4.5
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Page 79 and 80: Consolidated Statement of Recognise
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5 Taxation continued Financial Stat
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Financial Statements Notes to the F
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11 Goodwill and other intangible as
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11 Goodwill and other intangible as
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14 Other receivables and investment
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18 Net borrowings continued Financi
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Financial Statements 19 Financial r
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24 Acquisitions There were no acqui
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26 Post-employment obligations Fina
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26 Post-employment obligations cont
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Independent Auditors’ Report to t
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Notes to the Financial Statements o
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Group Financial Record For the year
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OffHighway GKN OffHighway Ltd GKN W
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Unsolicited mail GKN is obliged by
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Contact Details GKN plc PO Box 55 I
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