This week I assessed companies in the Construction Materialsand Building Products industries in regards to their overall SustainabilityDisclosure and Practices.
Similar to the articles I wrote on the Software and Servicesindusty and the Biotechnology industry, to get started I looked at an ESGRatings analysis of the cohort. Under this GICS classification the researchfocused on 50 companies in the US, UK and Europe. The full list of companies availableis at the bottom of this article.
MSCI: Of the 50 companies, 9 received an MSCI AAA. 36of 50 had an A score or above. Only 2 companies scored lower than BB, one witha B and one with a CCC.
Sustainalytics: There was a wider range ofSustainalytics score with the best score a 10.5 (lower is better) and the worstscore a 39.8. The majority of the group scored between 20-30 on Sustainalytics.
CDP: CDP clearly has more prominence in this industrythan others we looked at as 29/50 were participants. No company was able to achievean A but x3 has A- scores: Owens Corning, Breedon Group and RHI Magnesita N.V.
ISS: Only 13 of the 50 companies have achieved thatISS Prime badge which begins at C+ for this group. X1 Company, Owens Corninghas been able to get to ISS B.
Considering these results, we looked into the top x5 performersin both GICS classified “Construction Materials” and “ Building Products.” Thecountry breakdown of the companies assessed are below:
· USA: 36 Companies
· UK: 9 companies
· Germany: 2 companies
· Denmark: 1 companies
· Austria: 2 companies (Both made the top 10)
For Construction Materials those are:
· Wienerberger AG
· Breedom Group Plc
· RHI Magnesita N.V.
· Marshalls Plc
· Sigmaroc Plc
For Building Materials
· Owens Corning
· Carrier Global Corporation
· Lennox International Inc
· Armstrong World Industries
· Zurn Elkay Water Solutions
In this article, I have looked into the top x10 performers to provide commentary on what we see in their disclosure practices overall and what leading companies from these industries are doing in terms of disclosure.
Some overall summaries for this:
· Health and Safety is a key area for this groupto have targets for. Across the cohort of companies assessed we consistently saw Health and Safety targets as a top priority.
· The majority of the companies in the top 10 had extensive policy pages with both reporting archives of their core sustainability documents as well as access to a multitude of policies that are appliable to their business
· Of the top Ratings performers, it is common practice to offer a Code of Conduct / Supplier Code of Conduct across multiple languages with fast access on your website.
· Wienerberger and RHI Magnesita N.V. both transitioned to CSRD aligned reports. The rest of the top 10 have not however use of voluntary frameworks such as GRI, SASB and TCFD (IFRS) is prominent. For example, Carrier Global did not publish under ESRS but they used GRI codes in a similar way to market CSRD disclosure.
· Both Owens Corning and Zurn Elkay publish data tables showing where they have industry membership.
· Zurn Elkay has transitioned to an IFRS index(One of the first ones I have seen). IFRS stand alone report there.
As an Austrian Company they published a CSRD aligned report in FY 2024. Access the 119 page Sustainability Statement here. 9 of 10 ESRS topic standards are listed within their Sustainability statement. They have detailed targets across: Waste Management, Circularity, Biodiversity, Health & Safety, Revenue from products supporting net-zero buildings, Water management, Decarbonization and Energy Mix, Training and Development, Social Commitment, Diversity, Equity & Inclusion. See example of how this is displayed below.
Their Sustainability page opens with a statement around their Net Zero Goals: “The construction sector offers major opportunities to help the world build as sustainably as possible and Breedon is committed to achieving net zero carbon emissions. The ambitions and targets we have set in our Sustainability Strategy will shape our people, our products and our business operations, securing our ability to operate in the long term and provide value to wider society, too. Donna Hunt, Group Sustainability Director” In their Annual Report page 69 they begin discussing the Sustainability Strategy focusing on targets. (See image)
In their Annual report, there is both an opening around Sustainability as well as a regulatory aligned Sustainability Statement for CSRD (See page 66). 7 of the 10 topic standards were considered material for them. Safety is the first KPI they list.
Furthermore, on their website they show multiple langauges support for the Code of Conduct which is often a key areas assessed by rating agencies.
Marshalls has a 34 page Sustainability Report that includes a GRI Index and communicated the following priorities for 2025: Fraud prevention training programme, Creation of Conflict of Interest Policy and Publication of additional Environmental Product Declarations (EPDs) for natural stone. On their website the have a documents page to show key PDFs and certificates.
Has a very extensive policies page on their IR Site. They also have a detailed “Road to Net-Zero” sheet on the ESG & Sustainability section of their website.
It is no surprise they top the list for ISS and CDP. When checking their Sustainability Report they publish a 385 page document. Having looked at hundreds of Sustainability documents, this is probably the longest- focused ESG document I have ever seen. The end of their report includes quantitative data tables around topics such as Workforce Data, Safety Data, Emissions Data and more. They also include items lie a GRI table and matrix. On top of their Sustainability page, we also found a policy page with fast links to many documents.
They published an 87 page document called the Sustainability and Impact Report. Some things we found is Carrier embeds GRI codes within their core Sustainability report via the same best practice approach we saw in ESRS reporting. They also use these codes to populate data tables at the end of their report. Visitors can access a multitude of other documents including their CDP response, information around workforce development and more.
They publish both a 51 page Sustainability Report as well as a additional documents like a ESG Data Sheet, TCFD Disclosure, SASB Disclosure and more. The disclosure formatting is very clean enabling readers to quickly access the applicable date for them.
For them we found x2 primary documents, x1 68 page Sustainability Report as well as a performance data summary sheet. Their summary sheet includes an overview of their key performance KPIs. Similar to other companies they have a sheet taking you to an extensive reporting archive with fast access to Safety Policies, certifications and more.
Published a 154 page Sustainability report for FY 2024. One key highlight is that Zurn Elkay has transitioned to publishing an IFRS Index Instead of a TCFD Index within their end of report data tables (See example image). Like many of the others in this best practice cohort, you can quickly access all their policies here.
Companies included in the research:
AMERICAN WOODMARK CORPORATION
BUILDERS FIRST SOURCE, INC.
CARLISLE COMPANIES INCORPORATED
CORNERSTONE BUILDING BRANDS, INC.
GENUIT GROUP PLC
GIBRALTAR INDUSTRIES, INC.
GRIFFON CORPORATION
HAYWARD HOLDINGS, INC.
KNIFE RIVER CORPORATION
NORCROS PLC
QUANEX BUILDING PRODUCTS CORPORATION
VULCAN MATERIALS COMPANY
AAON, INC.
ADVANCED DRAINAGE SYSTEMS, INC.
ARMSTRONG WORLD INDUSTRIES, INC.
AZZ INC.
CARRIER GLOBAL CORPORATION
EUROCELL PLC
Heidelberg Materials AG
IBSTOCK PLC
JELD-WEN HOLDING, INC.
MARTIN MARIETTA MATERIALS, INC.
OWENS CORNING
RHI Magnesita N.V.
ROCKWOOL A/S
SIGMAROC PLC
VOLUTION GROUP PLC
BREEDON GROUP PLC
FORTERRA PLC
FORTUNE BRANDS INNOVATIONS, INC.
LENNOX INTERNATIONAL INC.
MARSHALLS PLC
RESIDEO TECHNOLOGIES, INC.
SUMMIT MATERIALS, INC.
Wienerberger AG
ZURN ELKAY WATER SOLUTIONS CORPORATION
JANUS INTERNATIONAL GROUP, INC.
CSW INDUSTRIALS, INC.
MASTERBRAND, INC.
UFP INDUSTRIES, INC.
UNITED STATES LIME & MINERALS, INC.
A. O. SMITH CORPORATION
APOGEE ENTERPRISES, INC.
EAGLE MATERIALS INC.
MASCO CORPORATION
PATRICK INDUSTRIES, INC.
SIMPSON MANUFACTURING CO., INC.
Sto SE & Co. KGaA
TREX COMPANY, INC.
INSTEEL INDUSTRIES, INC.
