Download - @GRIAusConf_Plenary: Linking Sustainability to Strategy, Corporate Governance and Risk - Shane Lucas
1
Linking Sustainability To Strategy, Corporate Governance and Risk –the role of materiality.
Chair: Stella Whittaker, Senior Executive Sustainability and Climate Change, Manidis Roberts; Vice-Chair, GRI Stakeholder Council.Michael Dundon, Chief Executive Officer, Vic SuperShane Lucas, Group Head of Sustainable Development, ANZAlex Malley, Chief Executive Officer, CPA Australia
The Role of Materiality:Linking Sustainability to Strategy, Corporate
Governance and Risk
Shane LucasGroup Head of Sustainable Development
The Australian GRI Conference on Sustainability and Integrated Reporting
Melbourne, 27 March 2012
3
The context: Our Corporate Responsibility Framework.
4
We maintain Sensitive Sector policies to guide decision-making.
• Sensitive Sector policies guide decision-making related to Water, Forestry & Forests, Energy, and Extractive Industries.
• Policies were released in 2009 and comprehensively reviewed in 2011 incorporating consultation with internal and external stakeholders.
• Process and outcomes of the review were reported through the 2011 Shareholder and Corporate Responsibility Review.
5
We offer social and environmental risk training to staff with lending responsibility.
• New social and environmental risk training program implemented earlier this year.
• Mandatory for all Credit Approval Discretion (CAD) holders in our Commercial, Corporate & Institutional Divisions globally.
• The training aims to:
• Assist staff in making responsible practices the foundation of decision making
• Ensure our people take account of the material risks and opportunities facing our clients and business
• Help minimise exposure to reputation risk.
6
Our relationship managers use screening tools to assess social and environmental risks.
• Social and environmental screening is a critical part of the assessment process for existing and prospective customers.
• Our screening tools are designed to continually evolve to respond to issues and industry trends.
• The screening covers social and environmental issues and includes our human rights standards – Respecting People and Communities.
7
There is a well understood and transparent escalation process that goes to the highest level of the bank.
• ANZ utilises an escalation model allowing all staff to identify and escalate projects or customers with reputational risk potential.
• Staff are provided with tools, training and policies to aid determination of approval – or the need for escalation or rejection.
• Escalation can continue to the Group Reputation Risk Committee chaired by the Group Chief Risk Officer.
RMconsideration
S&EScreening tool
Executiveconsideration
Reputation Risk
Committee
Social &Environmental
risk
SustainableDevelopment(Advisory role)
EquatorPrinciples
consideration
CustomerTransaction
Project
No appetite
A A AA
A Approval pointInstitutional risk
Asia, Pacific, Europe, America
Risk
8
We publish sector information statements on anz.com
• Stakeholders expect more disclosure and
transparency on our approach to sensitive
sector customers and projects.
• anz.com houses detailed information
statements on our sensitive sector
policies.
• anz.com also holds position statements
on stakeholder concerns and specific
campaigns (coal-fired power generation,
cluster munitions, Gunns).
• Our approach to transparency and
reporting is continually evolving in
response to industry trends – and our own
values.
9
Our Shareholder and Corporate Responsibility Review – meeting stakeholder expectations.
• Since 2010, ANZ has published a combined shareholder and corporate responsibility review
• Stakeholder conversations and industry trends sought a robust and practical document that included information on financial and non-financial measures of performance
• 2010 and 2011 reviews included information about sustainable development approach, material issues, policy positions, and governance processes
• Our approach to the Review is also evolving in response to feedback from customers, investors and stakeholders
10
• In 2010, we revised our Military Equipment policy in response to stakeholder concerns – and material, values-based reflection.
• We encouraged direct engagement between the stakeholder and customers allegedly involved in the production of cluster munitions components.
• We engaged directly with our defence customers and outlined the rationale behind our revised policy – and the material implications for our relationship.
• Customers responded positively – 2 of 3 companies committed to cease production at the conclusion of existing contracts.
• We respectfully exited one relationship.
Our approach in action: Military equipment.
11
Thank you