Attracting, enabling and engaging a diverse workforce

We strongly encourage identifying, hiring and promoting talented individuals from a range of diverse backgrounds. We expect our organization to achieve this by putting robust processes into place - such as ensuring a varied panel of interviewers for open positions, training managers on unconscious bias and conducting pay equity audits for associates at all levels.

We are creating a performance culture with a heart, where people are recognized for great results, where all our associates can thrive and be their best selves, where dialogues lead to continuous improvement and where we build high performing teams that deliver great customer experiences, resulting in strong business performance. Our newly introduced Arxada behaviors reinforce these efforts and are the foundation to building a great workplace.

Attracting & developing talent

As a vibrant and innovative company operating in a competitive sector, it is imperative to prioritize attracting and retaining top talent. By fostering a unique and distinguished corporate culture under the guidance of esteemed leaders in the chemical industry, we provide our associates with opportunities for career advancement and personal growth. This makes us an appealing employer for new recruits and underscores the significance of connecting with and fostering the growth of our current team members. By valuing our workforce and offering meaningful opportunities, we are establishing a robust and sustainable business.

For both our new hires and existing staff, we offer comprehensive training and personalized development plans. Annually, all associates are required to complete compliance training, including instruction on our Code of Conduct. Additionally, all People Leaders and large group contributors (1,000 associates) have access to LinkedIn Learning to enhance specific job-related skills and personal interests.

Our talent attraction efforts in 2023 were primarily led by individual locations and regional teams. This included regional partnerships with organizations focused on women in science, technology, engineering and math (STEM) and early career apprenticeship programs. We focused on ensuring that our talent attraction processes are designed to drive a broad pool of candidates in support of our goal to build a workforce that is inclusive of various genders, races, backgrounds and skill sets, representative of the communities where we work and operate. This year, we have introduced a new Recruitment Policy to guide these efforts.

We also worked to introduce personal development plans for all associates, enhancing clarity regarding job expectations through tailored training sessions on goal setting and feedback mechanisms for monitoring progress. Resources have been made readily available to support associates in achieving their career goals and aspirations. In addition, we launched Arxada's mentorship program in early 2024, which sets out to provide robust leadership conversations, reflections and action plans. We also established dedicated learning spaces for career development and introduced a more seamless onboarding process.

By creating a unique and distinct business culture led by recognized leaders in the chemicals industry, we can offer our associates career growth within our organization. This makes us an attractive employer for new hires and emphasizes the importance of engaging with and developing our current team members. By valuing our workforce and providing meaningful work, we are building a strong and thriving business.

Engaging associates

Associate engagement is a key to retention and our ever-evolving business makes it important to listen to our associates while providing them with a strong understanding of our purpose and values. To do so, we are providing our associates with regional guidance and are engaging them through awards and a specialized engagement survey.

All associates have access to a handbook that contains guidelines on policies and practices that are specifically applicable to their region. The handbook helps associates better understand their job expectations, as well as the company and its culture. It contains practical information on associate benefits, and outlines how misconduct, such as harassment and discrimination, is handled. Learn more about our values and approach to business ethics, including our Code of Conduct here.

To ensure we are effectively promoting areas such as diversity and inclusion and health and wellbeing within our organization, we rely on feedback from our associates. To gather this feedback, we use Peakon, the associate engagement plafform for our lnsights2Action survey. This initiative is deployed across our organization to measure our drivers of associate engagement, including role rewards, recognition, workload and other items that contribute to an overall engagement score. We work with local teams to develop and agree on action plans to improve their scores and engage associates more effectively.

lnsights2Action survey results are shared at the individual team level. Both the team results, as well as global results, help us identify areas across the business that need more support and attention.

Health and wellbeing scores measure the extent to which associates believe the organization values and supports health and wellbeing. Our health and wellbeing score rose from 7/10 in 2022 to 7.2/10 in 2023.³²

The survey also provides an associate Net Promoter Score (eNPS), which tells us how likely our associates are to recommend Arxada as a place of work to family and friends, so providing an additional measure of associate engagement and satisfaction. In 2023, our average engagement and eNPS score was 6.7/10.³³

We are working to improve our engagement with eNPS by providing enhanced training for line managers to enable them to have more meaningful development conversations and offer better support for their teams. We continue to aim for year-over-year improvement in our engagement scores.

In 2023, we experienced a dip in engagement during times of economic decline. We took immediate action by increasing our communication efforts, recognition programs and action planning. We built a more informal culture by implementing communication practices with meaningful dialogues and interactions. We also created more fun moments for people to connect and reflect. We have communicated the importance of wellbeing and set clear expectations on taking time off for recovery. We have also started to work on a new Arxada Behaviors program to address cultural change.

This year, female representation in our senior leadership team increased from 23% to 26%, exemplifying the ways in which we are encouraging women and creating a culture of inclusiveness at all levels.³⁴

For the whole company population, the representation of female associates increased from 25% to 26%.

To demonstrate our commitment to Diversity, Equity and Inclusion (DEi) at leadership level, in 2022 we began actively communicating our diversity measures to our Executive Leadership Team (ELT). Collectively, our ELT is actively involved in and passionate about driving awareness and progress on this topic. Our DEi steering committee, established in 2022, continues to champion DEi at operational level by fostering a diverse, equitable and inclusive culture. This groundwork has been instrumental with our progress in increased female-to-male hires, with an increase of 13% since 2022.

To attract top talent, we are developing a talent engine roadmap with specific workstreams focused on aligning job levels and performance measures globally, standardizing our approach to early careers and creating a plan for associate learning and development that includes training for line managers. Our talent engine roadmap will link to our DEi ambitions, creating a more diverse talent pipeline. This will include targeted partnerships and job descriptions containing gender-neutral and inclusive language. By implementing these strategies, we hope to position ourselves as an attractive and supportive employer for top talent.

In 2023, we founded four new Employee Resource Groups (ERGs). Each group has defined specific strategies and actions plans based on the community they represent. Through these ERGs, associates can attend educational sessions and virtual webinars, engage in meaningful discussions and exchange experiences and advocate for organizational changes. All ERGs are sponsored by a senior leader.

In early 2024, Arxada launched a mentor program called Women@Arxada. The program has more than 115 members representing all levels of our organization. Women@Arxada promotes Women in Chemicals events, with a focus on family-forward policies and the personal development of its members.

While DEi representation at the leadership level is important, we are working on creating a more diverse talent pipeline for all career levels by integrating DEi into our talent attraction processes and by utilizing an updated Recruitment Policy that reflects the goals.

Commitment to workplace safety, integrity and associate wellbeing

At Arxada, we are dedicated to maintaining a safe, dynamic and compliant workplace through comprehensive company-wide and local policies. Our internal guidelines cover critical areas such as living wages, integrity and anti-harassment, collective bargaining, and the labelling, storage and transport of hazardous materials.

We provide our associates with an Ethics & Compliance Portal and Hotline, enabling them to report harassment, ethical concerns, legal or regulatory violations or pose questions. Associates are able to remain anonymous. Arxada's hotline is available 24 hours a day, seven days a week. They have the option to speak to a call center representative, file an online report or contact Arxada's compliance group who can address their matter appropriately.

We have increased the focus on recovery and wellbeing in our corporate communications to empower associates to prioritize self-care. A directory of local Employee Assistance Programs (EAPs) provides easy access to appropriate levels of support to associates and their families, at no cost. The suite of services available through these programs spans matters of mental wellbeing and work-life balance to personal growth, family care and financial consultations.

Associate benefits

Arxada offers a comprehensive range of benefits, tailored to country needs and designed to foster the wellbeing of our associates, including medical and healthcare services, life insurance, disability coverage, retirement savings and/or pension plans. They and their families are supported through various phases of life with inclusive paid parental leave policies and benefits for childcare.

While the specifics of these benefits may vary by country, our commitment to essential support remains unwavering across all locations. In some regions, we also provide ancillary coverage for dental and vision care to ensure holistic healthcare and tuition assistance for continued learning and development. We internally track data on benefit utilization and eligibility to enhance and improve our benefit porffolio.

Commitment to pay fairness and equity 

Arxada is committed to providing fair and equitable reward opportunities for all associates. Our strategy reflects our desire to drive pay fairness and positively impact systemic pay disparities, as well as stimulate desire for action. Key initiatives include:

–   Conducting annual living wage studies to identify and address potential pay disparities by location

–   Frequently reviewing and evaluating macro-level pay gaps, if any

–   Monitoring living wage benchmarks and trends to stay current with best practices

–   Offering targeted learning programs to ensure unbiased reward decisions anchored in compensable factors and fair living wages.

Through these efforts, we aim to have a fair, supportive and equitable workplace for all Arxada associates.

In 2023, we conducted a living wage study to evaluate the size and significance of pay disparities in accordance with the latest International Development House (IDH) Recognized Living Wage Benchmarks at the time (as of June 2023).

Arxada's commitment to its associates is evident through our core values and actions. We foster an enriching work environment through initiatives aimed at promoting work-life balance and supporting personal development. These include our Bike to Work Challenge, racial equity lunch and learns, pay equity seminars, book clubs, blood and stem cell donation drives and local wellbeing activities. In 2023, our Thailand facility launched a comprehensive Health and Wellbeing Program to create a healthier workplace by providing a wide range of healthy activities for our associates.

Looking forward to 2024

In 2024, we will increase the level of communication regarding the activities of our ERGs and further build on the foundation of a nurturing culture that promotes inclusion. Through our ERGs, we can extract the authentic voices of our associates and understand their motivations and needs. This input will help us build the supporting policies and practices required to reach our goals. We will continue to maintain a continuous feedback loop to ensure our associates feel heard and are helping to drive policies with their insights.

 

^{[32] [33] The data covers 100% of our workforce, including Arxada (legacy LSI), TROY and Envirotech.}

^{[34] [35] Please note, the data provided is only for Arxada (legacy LSI). In 2022 this represented 74% of the company. In 2023 this represents 80% of the company.}

^{[36] Our senior leadership includes the following job roles: Associate Director; Director; Senior Director; Vice President; Senior Vice President; President; and CEO.}