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Johnson Matthey has a wide range of stakeholders with an interest in hearing from or working with the company at both a corporate and business level. Our stakeholders include any person or organisation that may interact with or have an interest in Johnson Matthey and include customers, employees, suppliers, fund managers, shareholders, communities, governments, non-governmental organisations (NGOs) and national and international trade associations. The company is also engaged with national and local government to inform the development of policy in areas where our technology and products can play a pivotal role. We aim to provide meaningful and transparent communications to meet the needs of all stakeholder groups and deliver information to them in the most appropriate format. These formats may include annual performance reports, participation in performance indices (Carbon Disclosure Project, FTSE4Good, for example) or one to one discussions on specific topics. At regular meetings with the company’s major shareholders, matters relating to sustainability and corporate social responsibility may be discussed, together with the performance and development of the group’s businesses.

We communicate with our stakeholders throughout the year and engagement is integrated into our business decision making processes. This 360 degree dialogue is essential in providing all parties with a rounded view of all material issues and helps all to shape their actions and strategies to move forward on these matters.

Read more about how we engage with our employees in the Employee Q&As section and in the Social section.

Read more about how we engage with our communities in the Community Investment section.

Johnson Matthey engages with a wide range of stakeholder groups as illustrated below. In previous sustainability reports we have provided details of engagement activities with our employees and our investors. In this year’s report we take a more in depth look at our involvement with the trade associations and industry organisations related to our business areas.

How We Engage

Stakeholder	Ongoing dialogue	Surveys / questionnaires	Regular meetings	Reviews	Audits	Sustainability Report	Annual Report
Employees
Shareholders
Institutional investors / analysts
Suppliers
Customers
NGOs
Regulatory bodies
Trade associations
Ethical investment markets
Voluntary schemes (CDP)

Economic Impact and Distribution of Value to Stakeholders

2010/11 marked a return to strong growth for Johnson Matthey as demand for our products increased across most of our businesses.

The group generated an underlying operating profit of £366.2 million and revenue of £9,985 million in the year. Of this revenue, £7,705 million represents the value of precious metals in our products which is a pass through cost for Johnson Matthey that we directly transfer to our customers. As a result, we may see quite large year on year swings in the revenue line depending on the movements in the market prices of precious metals during the year. Sales excluding the value of precious metals is thus a better measure of our sales, equivalent to other companies’ turnover.

Of the £9,985 million revenue in 2010/11, the costs of goods and services were £9,124 million (including £7,705 million for precious metals) while our own operations created £860.5 million in underlying added value.

Employees received the largest share of this underlying added value, some £459.0 million or 53.3% of the total, reflecting the fact that Johnson Matthey is a high technology company employing many highly skilled employees across the globe. Amounts payable to providers of capital, i.e. our shareholders and financiers, were £118.6 million or 13.8% of the total, and taxes of £92.1 million (10.7%) were payable to governments. In 2010/11 we retained / invested £190.3 million (22.1%) in the business for future growth and £0.5 million (0.1%) was invested in our local communities. This investment in local communities includes donations made by Johnson Matthey and does not include the value of employee time donated during working hours. Work is underway to develop our systems to capture further details of our contribution to local communities.

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• Economic Impact and Distribution of Value to Stakeholders