Fair Money & Economic Opportunity

Rolls-Royce Holdings plc is an engineering company that designs, manufactures, and distributes power systems, not a financial institution.

The 'Fair Money & Economic Opportunity' value specifically evaluates financial institutions and their provision of lending, insurance, moving, or storing money for consumers. The provided articles do not contain any evidence that Rolls-Royce offers such financial services or products to consumers. Therefore, all KPIs under this value are not applicable and are omitted due to a lack of relevant evidence.

Fair Pay & Worker Respect

The company's CEO to median employee pay ratio is 64:1, reflecting strong pay equity efforts.

However, only 1,200 workers at the Goodwood plant are covered by a collective bargaining agreement, representing approximately 2.9% of the total workforce of 41,400 employees. The total reportable injuries rate (TRIR) is 0.29 per 200,000 hours, indicating a near-zero injury status. The median gender pay gap across all UK employees is 4.4%, with women earning less than men. Employee engagement is reported at 78% based on the "Our Voices" survey. The voluntary employee turnover rate is 15%. Rolls-Royce has faced two employment-related penalties totaling $135,000, including for employment discrimination, and was fined for breaching safety regulations in 2014 related to a radioactive capsule incident.

Fair Trade & Ethical Sourcing

Rolls-Royce mandates adherence to its Global Supplier Code of Conduct for all suppliers through the General Conditions of Purchase and precedent contractual terms, covering 100% of contracts.

The company has reported zero instances of modern slavery, forced labor, or child labor in its own operations or supply chain for 2024, with no related concerns raised via its Speak Up Line during these years. Rolls-Royce views supplier diversity as a strategic advantage and has more than 200 small and medium-sized companies registered with its Supplier Diversity Programme, but the percentage of the procurement budget directed to these suppliers is not specified.

Honest & Fair Business

Rolls-Royce agreed to pay over $800 million to resolve bribery charges with U.S., UK, and Brazilian authorities for schemes that lasted more than a decade.

The company has a 'Speak Up Line,' an independently managed, confidential online and telephone service available 24/7 in multiple languages to all stakeholders, with 98% of employees completing annual mandatory learning in 2024. However, a former employee claimed concerns were ignored for six years, and the company did not self-report misconduct until media reports surfaced. The company restated cash flows in 2023 due to a change in accounting policy, reclassifying £326 million from financing to operating activities for 2022. Audit coverage in 2023 included 96% of revenue, 76% of profit before tax, and 90% of total assets. Rolls-Royce has a digital Code with a zero-tolerance approach to bribery and corruption, supported by Global Anti-Bribery and Corruption policies, and routinely checks its program effectiveness. However, the company admitted to paying over $35 million in bribes to officials in six countries. Bureau Veritas UK Limited provided limited assurance for selected sustainability performance indicators in 2023, including GHG emissions and employee engagement score.

No War, No Weapons

Rolls-Royce derived approximately 31.6% of its total revenues from arms in 2024.

The company provides engines to the Typhoon and Tornado aircraft used by Saudi Arabia in attacks on Yemen, and KLP excluded Rolls-Royce from its portfolios due to involvement in controversial weapons, including nuclear weapons. In 2004, Rolls-Royce lobbied to weaken anti-bribery procedures introduced by the Export Credits Guarantee Department. Amnesty International criticized the company's human rights due diligence policies in 2019 in light of the Saudi-led coalition’s campaign in Yemen. Rolls-Royce provides nuclear reactors for the UK Royal Navy’s fleet of submarines, including the nuclear-armed Vanguard-class ballistic missile submarines. The board visited the Defence division in Washington, US, and explored geopolitical risks. The company divested non-core activities, including a naval propulsors & handling business in the Defence division, but no comprehensive conflict-zone divestment policy is detailed.

Planet-Friendly Business

Rolls-Royce has a stated ambition to achieve net-zero GHG emissions by 2050 or sooner, covering at least 95% of Scope 1 and 2 emissions and relevant Scope 3 emissions.

Its long-term GHG reduction target for 2036-2050 is aligned with a 1.5°C goal, but its medium-term target for 2028-2035 does not cover the most relevant Scope 3 emissions, and it lacks a short-term target for up to 2027. While targets are set in accordance with SBTi methodology for its SMR subsidiary, validation is planned for the future. In 2022, 30.8% of the company's energy consumption came from renewable sources, including 0.9% from on-site installations. Many of its sites achieve zero waste to landfill, and over 60% of waste is from four principal sources. The company has committed to implementing TCFD recommendations and signposts TCFD-aligned disclosures. It has conducted climate-scenario planning, including a 1.5°C scenario, and disclosed its results. Rolls-Royce does not disclose capital expenditure towards decarbonization or climate solutions, nor does it have a commitment to the principles of a Just Transition. It mandates EcoVadis monitoring with supply chain partners, and 77% of suppliers responsible for 77% of Scope 3 Category 1 emissions will have SBTi targets by 2029. A Life Cycle Assessment (LCA) for its SMR design is in progress.

Respect for Cultures & Communities

Rolls-Royce has 6 formal partnerships with organizations such as Charities Aids Foundation India, The Akshay Patra Foundation, Tamana, NFBM, and Agastya International Foundation.

The company invested £6.96 million in charitable, social, and community contributions in 2019, with STEM programs making up the largest proportion. Rolls-Royce supports Tamana's Annual fashion show for inclusion and the Tamana Education Series, which develops audio/visual aids. The company honors the mural art of the Dunhuang Mogao Caves, suggesting active protection measures for cultural sites.

Safe & Smart Tech

Rolls-Royce has developed and peer-reviewed "The Aletheia Framework" (v2.0 released December 2021), a toolkit for ethics and trustworthiness in AI.

This framework considers 32 facets of social impact, governance, trust, and transparency, and includes a five-step continuous automated checking process to detect bias. A module was added in December 2021 to identify and mitigate bias in training data and AIs. The company also uses a 'Rolls-Royce 5 Checks Philosophy' for trustworthy AI outputs, including continuous test systems and independent checks. Rolls-Royce SMR Limited is working towards ISO27001:2022 certification in 2024, and its Integrated Management System was certified to ISO9001:2015 in 2023. In 2024, 98% of colleagues completed mandatory learning, including core compliance training related to data privacy and export control. Rolls-Royce SMR Limited states it uses Secure by Design and Safeguards by Design principles. The company is subject to UK and international laws and regulations governing data privacy. In July 2023, Rolls-Royce's website was inaccessible for three days due to a suspected cyberattack, with potential data theft related to SMR technology, though the extent was unconfirmed. Rolls-Royce has a Vulnerability Reporting system and funds 4-6 cybersecurity research projects annually through its Cybersecurity Technology Research Network.

Zero Waste & Sustainable Products

Rolls-Royce achieved a 60% recycling and recovery rate in 2024, with a target to reach 68% by 2025.

The company has reduced total solid and liquid waste in operations and facilities by 65%, normalized by revenue, against a 25% target for 2025. Several manufacturing sites have achieved zero waste to landfill. Rolls-Royce recycles approximately 20,000 tonnes of high-value metals annually through its Revert scheme. The company aims to reduce total solid and liquid waste in operations and facilities by 25% by 2025, from a 2014 baseline, and increase the recycling and recovery rate to 68% by 2025 from a 2019 baseline. Rolls-Royce manages hazardous waste through stringent rules and processes, minimizing hazards and substituting with safer alternatives where possible, and is focused on the managed reduction and phase-out of substances targeted by REACH. The company collects waste data from each individual site on a monthly basis. Rolls-Royce requires suppliers to provide responsibly-sourced materials and cascade these requirements through their supply chains. Product durability is a focus, with Trent 1000 TEN high-pressure turbine blades more than doubling their time on wing, and Trent 7000 and 1000 engines expected to deliver a further 30% time-on-wing benefit by year-end 2025.