Transparency

Target

Status

Work with Responsible 100 to have at least six critical friend reviews with NGOs on material policies for the Group to check they are fit for purpose by the end of 2016

Completed

Work with Open Corporates to improve our company structure disclosure to stay ahead of beneficial ownership transparency by the end of 2017

Ongoing

Deliver the first local sustainability report for India First and LGIM / LGA by the end of 2017

Ongoing

Launch the new and more inclusive ‘speak up and speak out’ line working with the Institute of Business Ethics by the end of 2016

Ongoing

Disclose our position on ‘Modern Slavery’ as a group working with key external NGOs to guide us

Completed

Our reputation to be open, fair, honest and a lawful business activity is one of our greatest assets. We are committed to maintaining the highest standards of ethics and we do not tolerate any form of fraud or dishonesty. Our policies and procedures, including those for whistleblowing, anti-bribery and corruption and information security, provide specific reference to detailed control procedures to minimise specific threats and aspects of fraud.

As a company we have developed a culture of transparency within our business. There are a number of initiatives and opportunities we have worked on during 2016.

Opinions on key issues

We believe the issues that matter focus around housing, health, energy, responsible investments, how we run our business, community development and an ageing population. These are areas we continue to campaign on and work with stakeholders to understand and improve our future. We do this in a number of different ways.

  1. Our CEO’s blog provides insight the parts we play in improving the economy, society and the environment.
  2. We invite our stakeholders who we work alongside to help us solve some of these opportunities.
  3. Inviting experts to scrutinise our business through www.responsible100.co.uk.
  4. Our critical friends meet with our business divisions to ‘critique’ the services and products we offer.

This shows our stakeholders how we embrace transparency and channel new ways of thinking.

Working with Responsible 100 Network.

We continue to work with Non-government organisations and not for profit partners to critique the services and products that we offer customers. In 2016 we committed to work with the Responsible 100 network to have at least six critical friend reviews with NGOs on material policies for the Group to check they are fit for purpose. We have delivered eleven of these resulting in scrutiny by over 200 experts through these forums to see if we are fit for purpose in the following areas:

  • Reporting cycles
  • Board Effectiveness
  • Whistleblowing
  • Employees who are careers
  • Cyber Security
  • Tax Policy
  • Modern Slavery
  • Water Use
  • Measuring Culture
  • Transition to a low carbon economy
  • Circular economy

In 2017 the Group Corporate Responsibility and Ethics Committee have identified a further 21 areas of our business needing to be tested during the year.

Stakeholder Feedback on Material Issues.

We had meetings in our offices with shareholders groups to understand their view on our Environment, Social and Governance (ESG) performance.

The feedback shows our Customer Privacy statement and our big data usage polices to be weak in the public domain. This affected our rating with MCSI who moved us from AAA to AA on our ESG performance.

We have since reinforced these statements with involvement from Compliance, IT, Legal and our Data Security team. The new wording shows:

Cyber security risk is a major issue today. In Legal & General we take the risk very seriously and are responding by continuing our programme of strengthening and developing countermeasures across all parts of the group and investing in our cyber-response capability also.

Effective governance of security is vital; we have established an executive-level group for cyber-security that has representation of all business divisions and with expert cyber-security input. The group has accountability for setting policy, reviewing security investments and endorsing the overall security strategy. In 2016, L&G appointed our first Chief Information Security Officer, with responsibility for Information and IT Security Oversight and Governance across the group. This is a critical role for Legal & General in light of our increased adoption of digital technologies and also the increased sophistication of cybercrime.

We have an approved set of security policies and standards that are applicable across the group. Implementation of the policies is done within the business divisions, and is overseen by 2nd line security function, in accordance with the operational risk model.

We recognise that effective defence against cyber-attack requires a comprehensive approach that covers people, process and technology. We help our people understand their responsibilities through regular awareness and training, we implement and revise processes to ensure the effective execution of policy in our environment, and we deploy start-of-the-art technologies to protect our assets.

Today with the complexity of cyber-security, we also recognise the importance of being able to react effectively to situations. Therefore our emphasis is not only to protect the organisation, but also on our ability to detect and anticipate events, and to establish a joined-up response capability to manage situations, small and large.

We liaise with other cyber-security contacts across the industry, with agencies, the National Cyber-Security Centre, the regulator and other key contacts to share knowledge, current thinking, good practices strategies and necessary for keeping ahead of the game.

Connecting customer to our investments

In 2016 we committed to provide our 10 million retail customers with a way of understanding how doing business with Legal & General funds UK Infrastructure. Our Investment map was made available to our 1 million 'My Account' customers as part of their online log in experience so that they can see what we have invested in on their behalf and close to their homes.

We are one of the first in our sector to deliver this level of transparency to our customers

New policies developed or revised during 2016

A number of new policy areas have been developed during 2015 across the Group including

  • A revised inducement policy
  • A revised Whistleblowing policy
  • A new gone away customer Policy – Launch 2017
  • An unclaimed assets Policy - Launch 2017
  • Speak out and Speak up service – Launch 2017

Looking ahead

The Group Corporate Responsibility and Ethics Committee reviewed areas of feedback from stakeholders and have tied these into our targets for 2017 as material issues for us to address.