Stepping up.

For Shareholders, Customers and Society.


These are the measurements used by management to monitor our financial performance.

  • Operating profit before tax

    £1,087m(2011: £1,053m)

  • Total shareholder return (TSR)

    50%(2011: 11%)

  • Net cash generation

    £865m(2011: £846m)

  • Insurance groups directive (IGD) capital surplus

    £4.1bn(2011: £3.8bn)

  • Return on equity

    15.5%(2011: 14.9%)

  • European embedded value (EEV) per share

    173p(2011: 167p)

  • Full year dividend

    7.65p(2011: 6.40p)

  • Employee engagement index

    78%(2011: 73%)

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Market Environment

There are a number of external factors that can impact and influence our business. They include the economic and political environment, regulatory and legal changes such as the Retail Distribution review (RDR) and broader societal changes such as the ageing of western populations. We need to understand, interpret and prepare for each of these changes as they emerge. We expect to operate in a period of change over the coming years.

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European population growth 1950-2000

European population growth 1950-2000

What makes us different?

We have over 175 years of experience and a range of businesses with strong synergies between them. Our expertise provides us with a number of competitive advantages which allow us to provide financial solutions and services to our customers throughout the various stages of life. To see which products fit with each life stage click on the link below.

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What we are doing

There are a number of key strategic drivers that have driven our progress in 2012. Putting customers at the heart of our business; Digital developments; Improving synergies between our corporate businesses; Retirement solutions; International growth; Infrastructure investment and talent and people development.

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Our Social Purpose

We consider that we have a social purpose beyond our financial and business prioirities. In its simplest form we believe that this is to help make financial security easier to achieve. To do this we aim to provide good value, high quality products for our customers. In this section of our report we outline a number of social issues that are key to our business and describe the work we have done to impove outcomes and understanding in each area.

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  • Business in the Community (BITC)

    Corporate Responsibility Index 2012
    We retained our Platinum status having first achieved this in 2011.

  • SIG Watch

    We scored -9 in the Corporate Reputations Index with NGOs in 2012. This was an improvement on our score of -28 in 2011.

  • ClimateWise

    We have improved our ClimateWise rating to 100%, an increase of 1% from 2011, we are now joint first in the insurance sector globally.

  • Dow Jones Sustainability Index

    We scored 73% in 2012 up from 71% in 2011. The sector leader scored 81%.

Risk management

Managing risk lies at the heart of our business and effective risk management capabilities are an area where we can gain real competitive advantage. This is essential to delivery of the Group's strategy and the generation of shareholder value.

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1 Setting our overall approach to risk –

2 Discussion of risk profile –

3 How we manage risks –

4 The residual risks that remain –