Graham Corporation is a global business that designs, manufactures, and sells critical, highly engineered heat transfer equipment for the defense, energy, chemical/petrochemical, aerospace/space, medical, and technology industries. To help maintain our culture of precise engineering solutions, we aim to provide continued transparency as we further enhance our performance in Environmental, Social, and Governance (“ESG”). Over the last few years, Graham Corporation has transformed from a highly cyclical refinery and petrochemical equipment supplier towards a well-diversified, multi-market company providing complete life cycle mission-critical equipment to defend our nation, ensure sustainable energy supply and enable space commercialization while fostering deep relationships with customers, engaging and regarding employees and embracing communities.
Sustainability
Commitment to Sustainability
Oversight
In 2022, we enhanced our ESG strategy to align with the broader transformation of our business. Our executive management team recognized the importance of embedding environmental and social priorities within our business operations. It approved an enhanced and modernized ESG strategy to drive additional progress on initiatives promoting sustainability and increased transparency. Continuing to ensure our accountability and improvement, Mr. Thoren, Graham’s Chief Executive Officer, is the lead officer with responsibility for overseeing and advancing the Company’s efforts concerning ESG initiatives. In such a capacity, Mr. Thoren reviews our ESG efforts with the Board and the various Board committees as appropriate.
Last year, we established ESG working groups at each company responsible for leading our ESG strategy and monitoring our corporate social responsibility and environmental sustainability initiatives. This group includes cross-functional subject matter experts from across the firm. Against this backdrop, we have assessed key indicators with outside ESG expertise and engaged with our internal and external stakeholders on ESG topics to help further inform our future direction and tenets. These ESG working groups oversee Graham’s sustainability strategy and subsequent disclosures, including our 2023 Sustainability Accounting Standards Board (SASB) Factsheet production: 2023 Sustainability Accounting Standards Board (SASB) Factsheet.
Environment
We believe that a focus on environmental stewardship is fundamental and integral to the work we do every day to serve our customers, create value for our stockholders, and benefit our global community. We have taken steps at our business units in Batavia, New York, and Arvada, CO, to improve energy efficiencies and air quality to lessen our environmental impact. Our Board of Directors approved our new Enterprise Environmental Policy, available on our website here. We support clean energy initiatives of our customers, including hydrogen, nuclear, biodiesel, and geothermal power. Here are some highlights of our environmental sustainability efforts lately:
- Upgraded boiler feedwater pump and VFD saved 6600 kW-hrs annually
- Encouraged environmentally friendly work practices by supporting recycling, reusing, and continuing to install energy-efficient equipment
- Increased the use of e-records and e-signing technology, resulting in carbon emissions reduction
- Migrated technology infrastructure to a cloud environment, reducing energy usage and, accordingly, our carbon footprint
- Encouraged environmentally friendly workplace practices by supporting recycling and separation of waste throughout our offices
Each of our facilities diligently controls hazardous waste and ensures wastewater and storm sewer discharges are monitored to support greater access to clean water. We help minimize the sources of pollution in our communities with Adopt-A-Street clean-up activities, factory recycling programs, electric car charging stations, and implementing energy-saving initiatives like LED lighting, motion sensors for lighting, smart compressors to manage energy loads, and installing programmable thermostats in our facilities.
Our People
At Graham, we believe our most important asset is our people. We are committed to fostering and embracing a Graham community where employees share a mutual understanding and respect for each other. Our pledge to diversity and equality encompasses our commitment to creating a work environment that embraces inclusion regardless of race, color, religion, gender, sexual orientation, gender identity, national origin, age, genetic information, marital status, amnesty, pregnancy, disability, veteran status, or based on pregnancy, childbirth, or related medical conditions. We continually strive to use our knowledge, talents, and resources to improve the quality of life of our workforce.
Diversity, Equality, and inclusion (“DEI”) are essential to us at Graham. Our commitment starts with attracting, retaining, and developing a diverse background, knowledge, skill, and experience workforce. As of March 31, 2023, women represented approximately 19% of our workforce and 33% of our independent Directors. Graham self-identified racial and ethnic minorities represented about 8% of our workforce, up 60% from last year.
Our Leadership recognizes that a diverse workforce and a culture of equity and inclusion help us compete more effectively, sustain success, and build long-term shareholder value. We encourage every one of our team members to form deeper relationships with those around them based on mutual respect, dignity, and understanding. Furthermore, we implement employee surveys to promote productive conversations within our organization. Graham has robust non-discrimination and anti-harassment policies as outlined in our employee handbook and a formal Code of Business Conduct and Ethics.
We believe that employee development is vital to our continued success, and we support the development of our employees through programs such as our internal weld school training, our partnerships for external weld training, our tuition assistance program, and leadership and management training classes. Our management continuously focuses on developing an inclusive and respectful work environment where our employees are highly engaged and motivated.
We are dedicated to ensuring the health and safety of our team members by supporting the whole person. Our dedicated global health and safety function ensures employees are trained on best practices to create a safe and healthy workplace. To ensure the health and well-being of our employees, we aim to provide a robust health and wellness package. Some of the various benefits we offer include:
- Competitive medical, dental, and vision benefits.
- Short- and long-term disability insurance.
- Paid maternity and parental leave.
- 401(k) retirement savings program, including company matching contributions.
- Employee Assistance Program provides free counseling services.
- Wellness incentives, including a wellness consultant.
Our Community
We believe investing in local communities to create social and economic outcomes is at the heart of generating social impact. We believe that to be successful, we need to push ourselves to do our best for our customers, our stockholders, the Company, ourselves, those around us, and the world we all share. We are committed to supporting the communities in which we do business by leveraging the power of our Company through donations, scholarships, education, and participation with specific charitable organizations. We strive to use our capabilities, reach, and resources to make a lasting difference. Namely:
- We participated in the GLOW Corporate Cup. This event aims for local businesses to form racing teams, compete in a fun atmosphere, and crown a winner of the Corporate Cup. With the proceeds raised from this event, the YMCA can fulfill its mission of youth development, healthy living, and social responsibility in the GLOW region.
- We implemented a United Way Day of Giving, the largest community-wide volunteer event across our region, serving Genesee, Livingston, Monroe, Ontario, Wayne, and Wyoming counties.
- Donated time and resources to several charities, including Habitat for Humanity, Second Wind Fund, Children’s Hospital, Community Table Food Bank, Family Tree, and veteran organizations.
- Partnered with school STEM programs to support students and educate them regarding careers in manufacturing and engineering
We believe it is our responsibility to respect human rights in our operations, including, among other things, opposing human trafficking and the exploitation of children. Accordingly, we have a Human Rights Policy Statement to emphasize our strong commitment to human rights. As another part of being a good corporate citizen, we have a Conflict Minerals Policy to support our commitment to sourcing components and materials from companies that share our values around human rights and ethics.
Corporate Governance
Graham is committed to achieving excellence in our corporate governance practices. We emphasize a culture of accountability and conduct our business in a fair, ethical, and responsible manner to earn our stakeholders’ trust. The Company has comprehensive corporate governance, sustainability policies, and structures to foster accountability and transparency. These policies reflect our underlying commitment to maintain the highest standards of ethics and integrity and to operate our business in compliance with all applicable anti-corruption, anti-bribery, and anti-trust laws and regulations.
The Board of Directors comprises most independent directors as defined by the NYSE listing standards and the Board’s Corporate Governance Guidelines. All of the Board committees are composed entirely of independent directors. The Board also believes that director refreshment is an essential component of good corporate governance, and therefore, in March of 2022, nominated two new directors.
Graham recognizes that effectively managing enterprise risks is critically important to the long-term success of our business. Management is responsible for our company’s day-to-day risk management activities. Our company relies on a comprehensive risk management process to aggregate, monitor, measure, and manage risks. While we exercise oversight, we do not have complete control over our supply chain or the suppliers we do business with; however, we continually seek to partner with suppliers that share common values and a shared commitment to our ESG objectives.
As a global leader in designing and manufacturing critical electronics-enhanced turbomachines, turbomachine-based subsystems, and vacuum and heat exchanger technologies, Graham is a trusted partner that meets the industry’s high bar for data resiliency and security. We leverage the latest encryption configurations and technologies on our systems, devices, and third-party connections and further vet third-party vendors’ encryption, as required, through our vendor management process.
We routinely engage with our stakeholders to better understand their views on ESG matters, carefully considering the feedback we receive and acting when appropriate.