Corporate Responsibility

CSR recognises the importance of social, environmental and ethical (SEE) matters and during 2009, continued to work towards compliance with the ABI disclosure guidelines on social responsibility. We believe that our work is part of a continuous improvement to develop standards and working practices that represent tangible improvements in the way in which we undertake our business and also meets our responsibilities to the wider community and all our stakeholders. This includes the impact through our operations on the environment, on the safety and well being of our employees, and end users of our products as well as those who contribute to the process of the development and manufacture of our products through our suppliers, distributors and customers. Following the acquisition of SiRF, we recognise that we need to more effectively harmonise best practices which presently are carried out by separate parts of the group. This is an ongoing objective for 2010.

SEE matters are considered an integral part of the philosophy of the Company, and the Board and its committees receive reports as part of their routine business on aspects of SEE issues in addition to other reports from those directors responsible for such matters as may be appropriate from time to time.

The Company expects the highest of ethical standards of all its employees and its policies and procedures support its stated aim of acting with integrity in all aspects of its operations. From the time of his appointment in June 2008, the Board director responsible for health and safety matters has been Will Gardiner, Chief Financial Officer. Mr Gardiner met on a number of occasions with those who manage the Company’s health and safety issues including the Chair of the Health, Safety and Environmental (HSE) Committee. An annual report is presented to the Board covering health and safety matters, which includes statistics on accidents and incidents, progress against targets from the previous period and objectives for the next year.

In the UK, we have a Health, Safety and Environmental Committee which meets regularly and is chaired by the Group Facilities Manager, who is also the senior health and safety manager for the Group. Our Health, Safety, and Environmental policies are available to all employees on our intranet site as are the minutes of the HSE Committee and current HSE initiatives. Current initiatives are explained below.

Throughout 2009 we continued to assess the existing measures around health and safety management at a number of our overseas offices. This entailed a base line assessment of health and safety standards and management at the locations visited, in addition to providing training on basic practices. This was augmented by guidance on establishing or improving on current local policies by reference to both local law and best practice within the Group. These activities will be extended throughout 2010 to include the additional offices that form part of the enlarged CSR group, in particular following the acquisition of SiRF.

The Executive Director with responsibility for the Group’s Environmental Management System (EMS) is Mr Chris Ladas, Operations Director. The EMS, which has the support of the Board, has been developed reflecting our existing low eco-footprint, with all employees working in office based environments, whilst recognising that high standards should be established and maintained across all aspects of our operations. The ongoing management of EMS is overseen by a team incorporating managers responsible for Facilities, Business Management Systems and Quality Assurance.

In June 2009, the Company’s recertification assessment against both ISO 14001 and OHSAS 18001 was undertaken by Lloyds Register Quality Assurance Limited which is an internationally recognised independent assessor. No major non-conformities were raised during this visit. Minor non-conformities found during the reviews were either addressed immediately or, in certain instances, a corrective action plan has been implemented. Progress in carrying out the action plans is monitored by the Company’s internal Quality Assurance department. The assessments confirmed that the Company’s Management System continues to satisfy the requirements of ISO 14001:2004 and BS OHSAS 18001:2007, and continued certification to these standards was awarded.

Certification requires that we have an Environmental Management System (EMS) which defines the environmental policy of the Group and sets objectives intended to drive continuous improvements in environmental awareness and practices. Our environmental policy includes commitments to:

• employee consultation and training;
• assessment of our activities and product related environmental impacts to identify targets for continuous improvement; and
• legal compliance and due consideration of other stakeholder environmental requirements.

We believe that we are taking considerable steps to contribute to sound environmental practices, covering not only the manufacture and supply of our products but also positive measures to establish and build on good working practices within our various office locations.

We continue to prepare for the introduction of the Carbon Reduction Commitment (or “CRC”) in the UK which begins in 2010. The CRC is a new mandatory Energy Efficiency Scheme in the UK that aims to reduce energy consumption and contribute to a reduction in carbon dioxide (CO₂) emissions. This objective is being managed through financial levies on businesses in the UK based on the consumption of electricity.

The CRC applies to organisations that meet certain criteria relating to their consumption of electricity derived from units purchased in 2008. Based on the qualifying criteria, we must participate in the CRC scheme.

Organisations that participate will have to monitor their energy use and either show reductions against prescribed targets or purchase allowances for each tonne of CO₂, based on energy consumed. There are also annual registration fees to pay beginning in 2010 and until the scheme ends, with 2010 being the first data reporting and registration year. Allowances will be sold by the UK Government in each compliance year through the initial CRC phase from 2011 to 2013. This is intended to provide a direct incentive for businesses to reduce energy use emissions, since the lower the emissions, the lower the levy paid to the Government. A performance league table will also be published showing the comparative performance of all organisations in reducing emissions, reflecting the annual returns from UK businesses.

We have developed plans and investigated appropriate measures in readiness for the implementation of the CRC scheme. As part of the Carbon Reduction Commitment in the UK, we continued our energy monitoring programme that encompasses taking readings of our electrical distribution boards to identify potential areas where energy efficiencies can be made. This has highlighted a number of systems where potential savings are possible and during 2009 we focused our attention on air conditioning and building management systems by adjusting operating times to give optimal utilization.

Looking forward into 2010, we are developing purchasing strategies so that an evaluation of the energy efficiency of a particular item of equipment is part of the selection criteria. This has already featured in decisions taken on the replacement of the main chillers at our Cambridge site, which constitutes one of our largest offices globally. This is an example of a practice which we could adopt across all our operations.

We remain committed to finding ways in which we can develop further the recycling of used materials.

During 2008 we met our target of reducing by 40% of total waste produced, the amount of material being consigned to landfill in the UK. In 2009 we extended our recycling waste streams to include the recycling of plastics and cans, and bio-waste and set a stretching target of recycling 50% of all the waste we produced in the UK which was successfully met. In conjunction with a local waste contractor our bio waste is processed into compost which can then be made available to local farmers and members of the public as a soil conditioner. The total amount of waste being recycled during 2009 rose from 895,940 litres to 1,130,300 litres. Over the same period, we experienced a 6.7% increase in the amount of waste produced from 2,234,000 litres to 2,384,120 litres.

The main objective for 2009 was to tackle our waste “at source” by finding ways in which we can prevent potential waste from coming on to site in the first place. This has proved very challenging since we have established through the review that a significant proportion of the waste we consign is unsolicited or unnecessary multiple copies of paper based materials provided by third parties. During 2010 we will be looking at ways in which we can limit the amount of this material being provided to us, whilst still maintaining the existing challenging recycling target. We will also target increasing our recycling of waste materials from 50% in 2009 to 55% in 2010.

During 2009 we continued to utilise Information Technology to support existing energy efficiencies whilst still providing state of the art research facilities and data storage capacity. Since 2007, we have successfully reduced power consumption in the UK as a result of improvements to the way in which we store and configure our information systems, resulting in the equivalent of around 220 fewer physical servers. This is equivalent to a reduction in power consumption of 37%, against figures as at the end of 2006 providing both financial and environmental benefits.

In recognition of the increasing globalisation of our business operations, in 2008 we reported on our intention to adopt video conferencing, which was expected to provide further financial benefits, operating efficiencies and reduction in our carbon footprint. Our target at the start of 2009, was to reduce travel expenditure by 25%. From 1 May 2009, we implemented a programme of rolling out video and audio conferencing facilities across all our international locations to improve operational efficiencies, and with the aim of reducing our overseas travel. Given the nature of the business activities undertaken by the Company in the integration process with SiRF, these facilities provided a significant tool with which to conduct meetings thereby limiting the increase in overseas travel. The acquisition however did mean that our original target for reducing travel was not met. Nevertheless, these facilities have been used for an average of approximately 190 hours every month since its introduction and we envisage utilisation of this facility to increase through 2010. Our objective over the coming year is to further enhance the video conferencing solution by extending the capabilities to external parties. This next step will allow the company to communicate with customers, partners and suppliers more effectively while at the same time reduce the need to travel.

An ongoing objective is to optimise the use of “greener” materials in our end products. We are committed to developing and supplying products which meet the highest standards as regards minimising the use of hazardous substances. CSR’s products are manufactured and packaged in a variety of forms. Most of these products are already manufactured according to CSR’s own “green” standards. The green standards have been developed by CSR as part of continual engagement with leading global companies who are customers of CSR and also with the support of our suppliers. CSR’s green standards therefore reflect not only internationally recognised guidelines but also the feedback of our customers, whose requirements frequently exceed the minimum conditions set by governments and regulators. 2009 has seen the integration of CSR and SiRF into one company. Both companies had existing programmes for development of “green” products. Since the acquisition a single “green” standard has been agreed and all new products developed have met this standardised requirement.

As part of our commitment to ensure compliance to international requirements, during the early part of 2010, we will perform a review of the “green” standards promulgated by national and supranational agencies, particularly to review developments from the Japan Green Procurement Survey Standardisation Initiative (JGPSSI) and in the USA, the Joint Industry Group (JIG). It is expected that our “green” standard will be upgraded to cover both these requirements following this review.

We have dedicated internal resource which assists in the development of all new products and the review of existing product lines targeting the use of greener materials. Part of their role is to monitor established and pending legislation and standards published by national and supranational governments and agencies and to ensure that we are proactive in going beyond the minimum requirements in our compliance with the types and quantities of materials used.

In this respect we work closely with both customers and suppliers in developing products which reduce the use of hazardous materials, and through testing and certification ensures ongoing compliance.

Our standard integrated circuits are fully compliant with all existing European legislation, including RoHS and REACH, as well as in other territories where equivalent legislation has been introduced.

In addition to procedures that establish and monitor compliance, we have processes in place to make sure that customers are supported with up to date materials information and laboratory analysis to validate the environmental compliance of our products.

We recognise the importance of ensuring that our key suppliers have appropriate policies and practices on SEE matters. Key manufacturing partners are selected and assessed based on certification to appropriate globally recognised standards such as ISO 14001, OHSAS 18001 and SA 8000. Audits of their operations are undertaken regularly to ensure that appropriate standards and certification exists.

During 2009, a review of product environmental compliance was conducted by our Supplier Audit Team at TSMC and ASE in Taiwan. This confirmed that current certifications to the recognised standards mentioned above were being maintained. The review also considered the suppliers wider HSE policies and management systems in connection with our requirements. The results of these assessments were reported to our management, which concluded that the suppliers complied with our requirements.

Based on the extent of our ongoing engagement with health, safety and environmental matters the Board is satisfied that there are no significant risks affecting its strategic objectives or the long or short term value of the Group.

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