Sustainability Review CEO Introduction Highlights GRI tables Commitments Group Chief Executive John Financial and operational This Review was written taking Our targets for the future Varley introduces our highlights of our performance account of the AA1000 standard and progress on our Sustainability Review across the Group and GRI reporting guidelines 2007 commitments As one of the world's leading banks, with 135,000 employees in more than 50 countries, Barclays plays a significant role, from working with governments on major infrastructure projects to bringing £4.69bn mainstream banking to customers in emerging markets. This online Sustainability Review explains our Tax paid to UK and non-UK progress on sustainability in 2007: the strong stories we have to tell, the areas where we still have work tax authorities. to do and our ambitions for the future.
CEO introduction Our governance framework Group Chief Executive John Responsibility for our Varley explains the shift from sustainability strategy rests corporate responsibility to with Barclays Group Executive sustainability in 2007 Committee, overseen by the Board
Stakeholder engagement Awards and recognition We engage with a wide range Barclays gained many awards of stakeholders in the many in 2007 for our progress on markets where we operate sustainability issues
Policy positions Economic impact Barclays has robust Group- As a large global company wide policies on important we have a significant sustainability issues economic impact which guide our employees’ activities
Scope of the Review The Review covers all our Business Units in the markets in which we operate. We provide details about the strategic approach we have adopted on sustainability across our businesses and then provide case studies and key performance indicators to highlight what this means in practice. The Review largely covers developments in 2007, however in some areas it has been necessary to provide information outside the reporting year, in order to set information in context. The Review is intended to provide a snapshot of our work in 2007 and benefits from the comments we have received from Corporate Citizenship, our external independent assurance provider. More information on our approach to sustainability and updates on our work will be available throughout the year on the other pages on our website, however the information in the Review will not change. We are determined to have a frank and ongoing dialogue with our many stakeholders, and this Review should be used together with the regularly updated information on our website to understand our commitment to embedding sustainability in our businesses. Introduction by Group Chief Executive John Varley
Corporate Social Responsibility (CSR) has been widely adopted as part of the strategic agenda of companies around the world. And it has become an important part of our life at Barclays.
In this, our eighth such report, we are developing our CSR ambitions under the strapline of ‘sustainability’. That’s the way we like to think about responsible corporate citizenship and it is the way that, in the future, we will report on the progress of our responsible banking across Barclays.
What do we mean by sustainability? Two things. First, we strive for sustainable relationships. That John Varley means seeking to ensure that, in the way that we serve our customers and clients, our long-term Group Chief Executive values of innovation, trust, and putting customers first are observable in how we behave.
Second, sustainability includes but expands the idea of being a responsible global citizen. Banks are an indispensable part of a productive economy and a healthy society. They facilitate risk taking and entrepreneurship, and they help those they serve achieve their goals – both are fundamental ingredients of sustainable economic growth and progression. Our corporate citizenship should not be confined to the making of philanthropic donations. It must include our obligations as a responsible employer, and our duty to manage the wider social and environmental impact of what we do.
We feel that ‘sustainability’ better captures these responsibilities and applying the term to our activities will keep us mindful of the centrality and durability of these commitments to our business and our brand.
It is very important to me that we can track how we are doing. And that we are candid in our self- assessment each year. We want our stakeholders to know that we take these matters seriously, in the certainty that they will judge us just as we judge ourselves, by what we do and not by what we say. As pleased as I am by the progress we report in this Review, I am very conscious of our need to hold ourselves to a requirement of continuous improvement. Barclays is not yet where I want it to be.
The format of our reporting has changed this year, and I wanted to explain why. We are committed as a Group to global carbon neutrality in 2009, and we set ourselves tough standards to reduce our waste and to increase our recycling. As a symbol of this commitment, for the first time this year more of our reporting is online than in printed form.
John Varley Group Chief Executive Economic impact
The support we offer as a bank helps our business and retail customers to grow and develop. Our investment products across all our Business Units help businesses and retail customers to develop and meet their long-term needs. Our ability to provide finance helps business to start and expand and our credit offerings to retail customers helps them to buy new property and to finance other needs. By doing what we do well as a bank, we can bring tangible benefits to the markets in which we operate. However, quantifying these benefits is not easy, especially when considering the multiplier effect – the wider economic impact of our employees and customers.
As a large global company our presence in the markets in which we operate also provides benefits to shareholders through dividends, our suppliers through the work we give them, our employees and their families through salaries and benefits, and governments through tax revenue.
• We paid £2.25billion in dividends to our shareholders in 2007. These shareholders include many of the major pension funds, mutual funds and insurance companies. Our success benefits millions of individuals around the world who rely on their pensions and investments for their income. In 2007, 7% of shares were held by individual investors. • Taking into account our share price, as well as the dividends paid, Barclays delivered a total shareholder return of 20.4% in 2007. This put us 8th in our chosen peer group for the period from 1 January 2004 to 31 December 2007 • We paid £7bn in employee salaries and incentives in 2007. We also contributed £301m to employee pension plans and retirement benefits • We also paid nearly £4.7bn in tax in the countries in which we operate, including more than £2.1bn in the UK • We have in excess of 25,000 suppliers with 10,000 making up 90% of our third-party spend. In 2007, our annual global sourcing spend was £7bn • In South Africa, we take supplier decisions that are intended to improve the economic prospects of black South Africans. In 2007, Absa was able to significantly improve the percentage spend with Black Economic Empowerment (BEE) companies throughout 2007. The Financial Sector Charter target for Absa is to have 50% (weighted spend) of its qualifying third-party spend going to BEE- rated suppliers by 2008. Absa has significantly exceeded that target a full year ahead of schedule, with 62% (weighted spend) of its qualifying procurement spend going to BEE companies during 2007. In 2008, we intend to commission a research project to map the economic impact of our presence in the emerging markets. We will use this research to consider how we can better serve the communities in which we operate. Net UK Net non-UK tax paid tax paid Total £m £m £m Corporate income tax(1) 71 1,512 1,583 Employee related tax (e.g. PAYE and NIC) 1,418 736 2,154 Indirect taxes (e.g. VAT) 321 285 606 Other taxes(2) 323 25 348 Total 2,133 2,558 4,691
(1) The total global corporate income tax paid of £1,583m will be the amount shown in the cash flow statement in the Group’s annual report. The £71m paid to the UK tax authorities is the net of £513m paid less £442m reclaimed for overpayments in earlier years.
(2) This is mainly income tax withheld on customers’ UK interest income (being £249m of the total £348m). Some non-UK amounts have yet to be obtained. Our governance framework Governance Corporate responsibility is firmly established as one of the Barclays Principal Risks, which means that it is managed within a robust framework of internal control, governance, and risk management processes.
Responsibility for Barclays Sustainability Strategy rests with the Group Executive Committee, with oversight by the Board. The Group Chief Executive has primary responsibility for embedding sustainability throughout Barclays, supported by the Group Executive Committee. This includes Our global headquarters is at ensuring there are effective processes for identifying and monitoring all the business risks or 1 Churchill Place, Canary Wharf, commercial opportunities that have a significant social, environmental or ethical dimension. London.
The Brand and Reputation Committee is a sub-committee of the Group Executive Committee, and is chaired by Sir Nigel Rudd, Deputy Chairman and a Non-Executive Director on the Board. This committee's role is to identify and manage issues that could have a significant impact on Barclays reputation. It met six times during 2007 and dealt with issues ranging from Barclays presence in Zimbabwe to new areas of commodities business and the fee structure for Barclaycard.
The Community Partnerships Committee, chaired by Group Vice Chairman Gary Hoffman, sets the policy and provides governance for our global community investment programmes, and the Environmental Steering Group gives direction and governance to our environmental and climate change strategies.
The Treating Customers Fairly (TCF) Forum, chaired by Group Vice Chairman Gary Hoffman, monitors progress across all retail and wholesale Business Units, UK and non-UK, to embed TCF principles in our relationships with customers. This wider approach to TCF goes significantly beyond our regulatory requirements.
The Barclays Board Joined as The Board director Marcus Agius Group Chairman 2006 John Varley Group Chief Executive 1998 Robert E Diamond Jr President, Barclays PLC and Chief Executive, Investment Banking and Investment Management 2005 Gary Hoffman Group Vice Chairman 2004 Chris Lucas Group Finance Director 2007 Frits Seegers Chief Executive, Global Retail and Commercial Banking 2006 David Booth Non-executive Director 2007 Sir Richard Broadbent Senior Independent Director 2003 Leigh Clifford AO Non-executive Director 2004 Fulvio Conti Non-executive Director 2006 Professor Dame Sandra Dawson Non-executive Director 2003 Sir Andrew Likierman Non-executive Director 2004 Sir Michael Rake Non-executive Director 2008 Sir Nigel Rudd DL Deputy Chairman 1996 Stephen Russell Non-executive Director 2000 Sir John Sunderland Non-executive Director 2005 Patience Wheatcroft Non-executive Director 2008 Executive Committee Date appointed John Varley Group Chief Executive 1996 Robert E Diamond Jr President, Barclays PLC and Chief Executive, Investment Banking and Investment Management 1997 Paul Idzik Chief Operating Officer 2004 Chris Lucas Group Finance Director 2007 Frits Seegers Chief Executive, Global Retail and Commercial Banking 2006
Other officers Date appointed Jonathan Britton Financial Controller 2006 Lawrence Dickinson Company Secretary 2002 Patrick Gonsalves Joint Secretary, Barclays Bank PLC 2002 Mark Harding General Counsel 2003 Robert Le Blanc Risk Director 2004
Our membership of external organisations related to sustainability These include:
• Business Leaders Initiative Human Rights (BLIHR) – a programme to help lead and develop the corporate response to human rights. • United Nations Environment Programme Finance Initiative (UNEP FI) – a global partnership between the United Nations Environment Programme and the finance sector. • The Carbon Disclosure Project – an independent not-for-profit organisation established to understand the business implications of climate change. • The Wolfsberg Group – an association of 11 global banks which seeks to develop standards to tackle financial crime. • FTSE4Good – measures the performance of companies against globally recognised corporate responsibility standards. • The Dow Jones Sustainability Index – global indices tracking the financial performance of the leading sustainability driven companies worldwide. • The CBI Climate Change Task Force – Marcus Agius, our Group Chairman, sits on the Task Force with 17 other Chairmen and Chief Executives to assess how business should tackle climate change. • The Climate Change Group – an independent, non-profit organisation dedicated to advancing business and government leadership on climate change.
Investor relations Institutional investors The Board’s priorities include communicating with shareholders, to keep them well informed about the company’s prospects and strategy, and staying abreast of the views of major shareholders.
To achieve this, executive directors and senior executives hold group and one-to-one meetings with major investors. Analyst research notes are distributed to directors and our corporate brokers provide annual feedback to the Board.
The Investor Relations team organises roadshows, seminars, conferences, presentations and other activities that enable the directors to interact with investors.
Prior to each Annual General Meeting (AGM), the Group Chairman, Senior Independent Director and Company Secretary have a series of meetings with the corporate governance representatives of our major institutional shareholders. Private shareholders A change in the law now allows us to communicate electronically with our shareholders, unless they advise us that they prefer to receive paper documents.
We have given shareholders a choice of how to receive future shareholder communications and those that receive documents electronically will have access to shareholder documents as soon as they are published. These new arrangements will enable us to use less paper, which benefits the environment and lowers distribution costs for the Group.
This year, we will continue to post the Annual Review, Notice of Shareholder Meetings and proxy forms to all shareholders.
We encourage shareholders to hold their shares in Barclays Sharestore, where shares are held electronically in a cost-effective way.
Our e-view service enables shareholders to receive their shareholder documents electronically. It also gives shareholders immediate access to information relating to their personal shareholding and dividend history. Participants can also change their details and dividend mandates online and receive dividend tax vouchers electronically.
How remuneration is linked to sustainability performance Sustainability objectives are included in the performance contracts of employees with specific responsibilities in this area. This would include Group Vice Chairman Gary Hoffman, and employees in Public Policy & Sustainability, Environmental Risk, Crime Prevention, Human Resources, and members of the Brand and Reputation Committee, among others.
In addition, Barclays employees’ annual performance assessment is based equally on the targets they have achieved, and how far their behaviour has demonstrated our Guiding Principles. In other words performance is based not only on what they have done but how they did it. Stakeholder engagement As a large business operating in more than 50 countries we have a wide range of stakeholders with whom we engage. This Review shows how we engage with these stakeholders in the many different markets in which we operate. There are, however, some key stakeholders with whom we engage on an ongoing basis.
Customers Our most important stakeholders are our customers. We hold regular surveys and focus groups to hear their views on how we can improve our products and services to better meet their needs. We engage with governments in the markets in which we operate. Consumer Groups These groups exist in some but not all of our markets. We engage with them in order to understand their views on any practical improvements we can make to our products and services and on any propositions we want to bring to market. In the UK in particular, we have an ongoing dialogue with consumer groups.
• In 2006, our Consumer Champion team set up a consumer roundtable to discuss our work with consumer organisations. We used the feedback to make changes to our products and services in the UK • Barclaycard UK held a consumer roundtable to help develop an enhanced consumer credit guidance section for its website.
NGOs Non-governmental organisations (NGOs) have an important role to play; working with government and business to highlight issues of concern in a range of different areas. We get approached by NGOs about the direct and indirect effects of our business. We engage with NGOs on a wide range of issues and where possible enter into a dialogue. We welcome their feedback but in some instances their concerns may be about the actions of our clients rather than our actions.
Colleagues We have an ongoing dialogue with our colleagues through networks and union representation. We also gain valuable feedback through the employee opinion surveys we conduct. Members of the Executive Committee, including Group Chief Executive John Varley, and other senior executives hold regular Colleague Presentations or Town Halls during which issues of interest, such as our financial results, are discussed with groups of employees.
Governments and political parties Banks play a vital role in the financial system and offer essential services to business and personal customers. Governments and public bodies have a legitimate interest in regulating and monitoring the banking sector. However, it is important to the health of the financial sector and wider economy that regulation and government influence is both effective and appropriate. To ensure this there must be an ongoing constructive dialogue between the banking industry and political stakeholders as well as regular contact with the regulators themselves. Barclays aims to provide candid input into government policy making and to provide policy makers with evidence to help in the decisions they have to make.
Part of being a responsible global citizen is offering expertise and advice to governments on wider social issues. Barclays is keen to assist and in 2007 engaged on issues as varied as reforms to the banking system in the UK, climate change and the Millennium Development Goals. Our role as a large bank in many developing countries means we also have to consider wider development issues as part of our political engagement.
The Group’s businesses and earnings can be affected by the fiscal or other policies and other actions of various governmental and regulatory authorities in the UK, the European Union, USA, South Africa and elsewhere. Areas where changes could have an impact include:
• The monetary, interest rate and other policies of central banks and regulatory authorities • General changes in government or regulatory policy that may significantly influence investor decisions in particular markets in which the Group operates • General changes in the regulatory requirements, for example, prudential rules relating to the capital adequacy framework and rules designed to promote financial stability and increase depositor protection • Changes and rules in competition and pricing environments • Changes to conduct of business rules and regulations • Further developments in the financial reporting environment • Expropriation, nationalisation, confiscation of assets and changes in legislation relating to foreign ownership • Other unfavourable political, military or diplomatic developments producing social instability or legal uncertainty which in turn may affect demand for the Group’s products and services.
Recent market instability has led to heightened interest from political stakeholders and our senior leaders spent considerably more time in 2007 in dialogue with ministers. In the UK, EU and USA particularly, we engaged with policy makers on a regular basis to provide them with an update on market developments, input to their reform packages and insight into the impact of policies as they developed. We sought to promote policies that would maintain market confidence, economic stability and protect the interests of our customers and shareholders.
We have three Public Policy teams that co-ordinate our work with governments in the markets in which we operate. The three teams in Group Centre, GRCB and IBIM have a global remit. Our teams provide input into government policy consultations including liaising with politicians, civil servants and government ministers. We also speak to international bodies such as the European Union, various United Nations organisations, the World Trade Organisation and the World Bank.
The Group did not give any money for political purposes in the UK nor did it make any donations to EU political organisations or incur any EU political expenditure during the year. Absa Group Limited, in which the Group acquired a majority stake in 2005, made donations totalling £170,142 in 2007 (2006: £212,729) in accordance with its policy of making political donations to the major South African political parties to support the development of democracy in South Africa. The Group made no other political donations in 2007.
We are members of a number of national and international trade bodies and associations which provide policy makers with feedback and evidence. Examples of our main trade body membership include:
• The British Bankers Association • The Council of Mortgage Lenders • Confederation of British Industry • The Payments Council • The American Banking Association • The South African Banking Association
Regulatory compliance risk Regulatory compliance risk arises from a failure or inability to comply fully with the laws, regulations or codes applicable specifically to the financial services industry. Non-compliance could lead to fines, public reprimands, damage to reputation, enforced suspension of operations or, in extreme cases, withdrawal of authorisations to operate.
We engage with the regulatory authorities in the markets in which we operate. This interaction gives us an opportunity to receive feedback on our own practice and also to comment and consult on the general regulatory environment in the markets in which we operate.
Think tanks We develop relationships with think tanks where we believe they can add value to the policy development process. During 2007, we sponsored a project led by the Institute of Public Policy Research on personal carbon trading in the UK. The project looks at the practicality of personal carbon trading. We have no set views to date but want to use this valuable research to guide our views.
Investors We set out details about our engagement with investors in our Annual Report, at our AGM and in ongoing dialogue throughout the year. Awards
Barclays gained many awards in 2007 for our progress on sustainability issues. Some of these are set out below:
Sustainable bank • Barclays, under the Woolwich brand, was named the top mortgage lender for customer empathy in a league table compiled by UK customer consultancy Harding & York. • Highly commended in the Business in the Community Marketplace Impact Award 2007 for our microfinance work in Ghana. • Absa was rated number one financial services company for contribution to development by Trialogue. • Barclays Commercial Bank was awarded ‘Best Commercial Mortgage Provider’ and ‘Best Leasing & Asset Finance Provider’ by Business Moneyfacts. • Barclays Commercial Bank was named Corporate Bank of the Year in the South West region. The award recognises the combined strength of Barclays corporate and leveraged finance proposition. • Barclays Commercial Bank was voted Business Bank of the Year at the UK’s Accountancy Age Awards in recognition of its dedication to clients. • Barclays Commercial Bank was named Debt Provider of the Year at the Deals of the Year Awards organised by EN magazine. • Call Centre Focus magazine European Call Centre of the Year 2007. • Best Customer Relationship Centre 2007 award in Portugal from the Portuguese Call Centre Association. • Barclaycard OnePulse was recognised as one of the world's most innovative banking cards in the Oscard international awards for the credit card industry. • Barclays Head of Environmental Risk Management, Chris Bray, received an accolade for his lifetime achievements from the United Nations Environment Programme Finance Initiative. The award honoured Chris’s commitment to sharing his expertise in environmental risk management with financial institutions globally. • Barclays Kenya was named East Africa’s Most Respected Company in the financial services sector in a PricewaterhouseCoopers survey. • Absa Islamic Bank was recognised as the best Islamic bank offering within a conventional bank in World Finance magazine’s first global awards. • Deanna Oppenheimer, Chief Executive UK Retail Banking at Barclays, was named Britain’s Business Communicator of the Year by the British Association of Communicators in Business (CiB). • Barclays was awarded Anti-Fraud Strategy of the Year at the Financial Sector Technology Awards which recognise the best use of new technologies to improve business processes. • Barclays under the Woolwich mortgage brand was named Best First Time Buyer at the Your Mortgage awards. • Named Best Small Business Bank Account by Start Your Business magazine. Responsible global citizen • Business in the Community Environmental Leadership Award 2007. • Leading bank in the Dow Jones Sustainability Index for environmental reporting. • Intelligent Giving website recorded Barclays as one of the top three UK companies supporting employees who give time and money to charity. • Absa was rated one of South Africa's top five employers in the Best Employers in South Africa 2007 survey. • Barclays was recognised for its best practice industrial relations in a Union Network International survey, which assessed the approach of 25 financial companies globally. • Barclays Spain’s employee community programme was ranked number two in Spain by Fundacion Empresa y Sociedad. • Our partnership with Crisis won a Business in the Community Big Tick award. • Business in the Community’s BUPA Healthy Communities Award for Spaces for Sports. • Hollis Sponsorship Award for Spaces for Sports 2007. • Sport England’s Community Programme of the Year Award. • Charities Aid Foundation Community Investment Awards for ‘most effective stakeholder engagement’ and ‘most effective company giving’. • Barclays Commercial Bank’s initiative to promote the health, safety and well-being of its colleagues was honoured at the UK’s National Business Awards. • Barclays Zimbabwe won the Harare Chamber of Commerce award for the Best HIV/AIDS Programme. • Barclays was recognised by The Times newspaper as one of the top places in the UK where women want to work. • Barclays was ranked 8th in the 2007 FTSE4Good Environmental leaders in Europe 40 index. Policy positions Bribery and corruption Barclays operates globally and believes that best practice governance, controls and compliance are essential for maximising shareholder value. In order to achieve this, it must act with the highest standards of integrity and honesty in all it does, to give customers confidence when entrusting their business to Barclays.
Barclays recognises that bribery and corruption have an adverse affect on communities wherever they occur. Corruption can undermine the rule of law, democratic processes and basic human freedoms, Barclays colleagues sign up to our impoverishing states and distorting free trade and competition. Corruption is often associated with policies each year by completing the organised crime, money laundering and, sometimes, even the financing of terrorism. Your Responsibilities booklet or our online version Our policy reflects the statutory requirements applicable in the UK as derived from the United Nations (UN) and Organisation for Economic Co-operation and Development (OECD) conventions on corruption. However, all Group offices must comply with this policy, unless there is a conflict with local legislation. Barclays offices outside the UK must comply with their own local legislation in respect of anti-bribery and corruption (e.g. in the US, the Foreign Corrupt Practices Act, which also has extra- territorial reach and implications for all Group offices).
We take our responsibilities seriously and expect all our employees, wherever they are based, to meet the requirements of our policy. Any breach of the Group's policy on bribery and corruption by any employee will be considered as grounds for disciplinary action, which may include dismissal.
Anti-money laundering Our anti-money laundering policy has been designed to be consistent with the UK 2007 Money Laundering Regulations, legislation, Financial Services Authority (FSA) Rules, Joint Money Laundering Steering Group (JMLSG) Guidance Notes and recommendations issued by the Financial Action Task Force on money laundering and terrorist financing.
Our employees must comply with the highest standards of anti-money laundering and anti-terrorist financing practice in all jurisdictions in which we operate and co-operate with the authorities wherever possible and practicable, paying due regard to customer confidentiality and data protection obligations.
All businesses must follow the UK Joint Money Laundering Steering Group Guidance when assessing their risks and designing their risk-based systems and controls unless prohibited by local legislation.
We provide appropriate employee training to ensure colleagues can meet these requirements.
Discipline, Capability and Grievance (DC &G) Global Standard This Global Standard establishes a set of minimum standards for dealing fairly and without discrimination with disciplinary, capability and grievance issues of all Barclays Group employees.
Harassment It is in everyone's interest that within Barclays we promote respect and equal opportunity for all. While we make every effort to achieve this very important goal, our workplace harassment policy recognises that inappropriate behaviour can sometimes happen and aims to deal with it in a serious, sensitive and confidential manner and to resolve it as quickly as possible.
Health and Safety (H&S) Global Standard This Global Standard establishes a set of minimum standards for H&S Management across the Barclays Group. Barclays Group businesses must ensure the health, safety and welfare of employees and, so far as is reasonably practicable, provide and maintain safe working conditions. They must also meet this responsibility towards all persons on Barclays premises, such as customers, contractors and visitors.
Conformance with these standards and policies are measured by the business and monitored by relevant governance and control committees. Redundancies In the UK, we have a landmark agreement with Unite on offshoring and site closures which offers early notification of redundancy, additional time for employees to find new roles either through internal redeployment or outplacement and a £2,000 re-training grant. Our emphasis is on avoiding compulsory redundancies where possible but in the event these do occur we have a generous redundancy pay policy.
Whistleblowing Barclays has a ‘Raising Concerns’ policy which employees can read on our intranets. It is also publicised widely across Barclays sites using an annual poster campaign and other communications.
There is a confidential telephone line and email account for employees to use if they feel they cannot resolve concerns with their own manager. Employees are encouraged to raise genuine concerns with the assurance that they will not be discriminated against in any way.
Financial Sanctions and Prohibition of Business Activity The Barclays Group Policy for Financial Sanctions and Prohibition of Business Activity is designed to ensure that all Barclays business areas comply with applicable financial sanctions in the jurisdictions in which they operate. We provide appropriate staff training to ensure staff are able to meet these requirements.
Sudan Barclays does not engage in business operations in Sudan nor do we deal with the Sudanese government.
Burma/Myanmar We have a policy of non-engagement with Burma/Myanmar. However, in May 2008 we donated £50,000 to the Red Cross to help support the relief effort in Burma following Cyclone Nargis.
Group Environmental Management Our policy was updated in April 2008 and applies to all our businesses. The policy is sponsored by the Group Operating Committee and the policy owner is the Group Head of Environmental Sustainability. The policy places requirements on Business Units to meet a number of essential Group-wide requirements including managing environmental impacts via our Environmental Management Systems, integrating environmental considerations into business decisions and managing the indirect impacts in our supply chain. In this section of our Sustainability Review 2007, we provide brief information about Barclays. Further details can be found elsewhere on our website or in our latest Annual Report. 11.3m UK current accounts. Business strategy Our customers Our strategy is to achieve Barclays Group has over superior growth through 30 million customers in time by diversifying our more than 50 countries profit base around the world
Where we operate Highlights Our map reflects the global Highlights of our financial and activity that we are reporting operational performance in this Sustainability Review across the Group in 2007
Products and services We have nine separate Business Units which work together to combine world-class capabilities Business strategy Our strategy is to achieve superior growth through time by diversifying our profit base. To achieve successful growth we must be relevant to our customers. By anticipating our customers' needs across the Group, we seek to align the sources of growth in the financial services industry with Barclays brand, capability and physical footprint.
Barclays is made up of two major businesses: Global Retail and Commercial Banking (GRCB) and Investment Banking and Investment Management (IBIM). Frits Seegers is Chief Executive of GRCB, which comprises UK Retail Banking, Barclays Commercial Bank, Barclaycard, GRCB Western Europe, GRCB Emerging Markets and Absa. Robert E Diamond Jr is President of Barclays PLC and CEO of Investment Banking and Investment Management, which spans Barclays Capital, Barclays Global Investors and Barclays Wealth.
The structure of the Group is designed to enable us to be well positioned for the significant growth which we anticipate in the global financial services industry and to help us serve customers and clients well.
We continued to invest heavily across the Group in 2007, increasing the number of employees who serve customers and clients, and developing our distribution networks.
Barclays PLC
Global Retail and Investment Banking and Commercial Banking (GRCB) Investment Management (IBIM)
UK Retail Barclays Barclaycard Barclays Barclays Banking Commercial Capital Wealth Bank
GRCB GRCB Absa Barclays Western Emerging Global Europe Markets Investors Our customers Barclays Group has more than 30 million customers in more than 50 countries around the world. UK Retail Banking serves around 15 million UK customers, including 11.3 million current account holders, 11.1 million savings account customers and 643,000 Local Business customers.
Barclays Commercial Bank serves 81,000 larger and medium-sized business customers, many of whom are long-standing and happy to act as advocates for Barclays among their peers. We are expanding at pace in Barclaycard has 10.1 million UK customers and 93,000 retailer/merchant relationships. It has 8.8 emerging markets such as India. million international cards in issue.
GRCB Western Europe has one million customers in four countries including 17,000 corporate customers and 772,800 current account holders.
GRCB Emerging Markets has two million customers in 14 countries including 15,000 corporate customers and 700,000 current account holders.
Absa has 9.8 million retail customers and 85,000 corporate and business banking customers.
Barclays Global Investors has 3,000 institutional clients.
Barclays Capital and Barclays Wealth do not report client numbers. Where we operate Operating in more than 50 countries and employing 135,000 people, we move, lend, invest and protect money for more than 30 million customers and clients worldwide.
Barclays around the world
Angola Cyprus Guernsey Jersey Mozambique Singapore Thailand Argentina Denmark Hong Kong Kenya Netherlands South Africa UAE Australia Egypt India Luxembourg Nigeria South Korea Uganda Botswana Ethiopia Indonesia Malaysia Norway Spain UK Brazil France Ireland Malta Pakistan Sweden USA Canada Germany Isle of Man Mauritius Portugal Switzerland Zambia Cayman Islands Ghana Italy Mexico Rwanda Taiwan Zimbabwe China Gibraltar Japan Monaco Seychelles Tanzania Highlights Barclays PLC is a major global financial services provider engaged in retail and commercial banking, credit cards, investment banking, wealth management and investment management. Operating in more than 50 countries and employing 135,000 people, we move, lend, invest and protect money for more than 30 million customers and clients worldwide. With over 300 years of history and expertise in banking, Barclays has nine Business Units, six within Global Retail and Commercial Banking (GRCB) and three in Investment Banking and Investment Management (IBIM). In our financial reporting, results for three of the GRCB businesses (GRCB Western Europe, GRCB Emerging Markets and Absa) are given under International Retail and Commercial Banking.
Financial highlights For the year ended 31 December
2007 2006 2005 Income statement £m £m £m Total income net of insurance claims 23,000 21,595 17,333 Impairment charges and other credit provisions (2,795) (2,154) (1,571) Operating expenses (13,199) (12,674) (10,527) Profit before tax 7,076 7,136 5,280 Profit attributable to equity holders of the parent 4,417 4,571 3,447 Economic profit 2,290 2,704 1,752 Basic earnings per share 68.9p 71.9p 54.4p Diluted earnings per share 66.7p 69.8p 52.6p Dividend per ordinary share 34.0p 31.0p 26.6p Return on average shareholders’ equity 20.3% 24.7% 21.1% Tier 1 capital ratio 7.8% 7.7% 7.0%
Profit before tax (£m) Economic profit (£m) 7,136 2,704 7,076 2,290 5,280 1,752
05 06 07 05 06 07
Earnings per share (pence) Dividend per share (pence) 34.0 71.9 68.9 31.0 26.6 54.4
05 06 07 05 06 07 Global Retail and Commercial Banking UK Retail Banking Barclays Barclaycard International Retail and Commercial Bank Commercial Banking Profit before tax £1,282m £1,371m £540m £935m – Personal Customers – Larger Business – UK Cards and Loans – Absa – Home Finance – Medium Business – Barclaycard Business – GRCB Western Europe – Local Business – Asset and Sales – Barclaycard – GRCB Emerging – Consumer Lending Finance International Markets – Barclays Financial Planning
Contribution to Group profit (a) 17% 18% 7% 13%
Investment Banking and Investment Management Barclays Capital Barclays Global Investors Barclays Wealth Profit before tax £2,335m £734m £307m –Rates – Index asset management – Private Banking – Credit – Active asset management – Offshore Banking – Private Equity – iShares – Brokerage – Absa Capital – Wealth Structuring – Closed Life Assurance
Contribution to Group profit (a) 31% 10% 4%
Note (a) Head Office functions and other operations segment has been excluded. Financial and operating highlights UK Banking Delivers banking products and services to 15 million retail customers and 724,000 businesses in the UK. 11.3m 724,000 UK Current accounts Business customers
Barclaycard Is one of the leading credit card businesses in Europe with an extensive international presence. 10.1m 8.8m UK Customers International cards in issue
International Retail and Commercial Banking Has operations with 13 million clients, in geographies which currently include Africa, France, Spain, Portugal, Italy, India and the Middle East. 2,349 International distribution points
Barclays Capital The investment banking division, provides corporate, institutional and government clients with solutions to their financing and risk management needs. US$441.5bn Value of debt issued globally
Barclays Global Investors Is one of the world’s largest asset managers and a leading provider of investment management products and services. US$2.1trillion Assets under management
Barclays Wealth Serves high net worth, affluent and intermediary clients worldwide, providing private banking, asset management, stockbroking, offshore banking, wealth structuring and financial planning services. £133bn Total client assets Products and services Barclays Group is made up of nine separate Business Units. These are UK Retail Banking, Barclays Commercial Bank, Barclaycard, GRCB Western Europe, GRCB Emerging Markets, Absa, Barclays Capital, Barclays Global Investors and Barclays Wealth. Business Units provide their own products and services, but also work with each other to develop products and services which build on or combine world-class capabilities across the Group.
UK Banking UK Banking delivers banking solutions to Barclays UK retail and business banking customers. It offers a range of integrated products and services and access to the expertise of other Group businesses. Customers are served through a variety of channels comprising the branch network, automated teller machines, telephone banking, online banking and relationship managers. UK Banking is managed through two business areas, UK Retail Banking and Barclays Commercial Bank.
UK Retail Banking UK Retail Banking comprises Personal Customers, Home Finance, Local Business, Consumer Lending and Barclays Financial Planning. This cluster of businesses aims to build broader and deeper relationships with its Personal and Local Business customers through providing a wide range of products and financial services. Personal Customers and Home Finance provide access to current account and savings products, Woolwich-branded mortgages and general insurance. Consumer Lending provides unsecured loan and protection products, and Barclays Financial Planning provides investment advice and products. Local Business provides banking services, including money transmission, to small businesses.
Barclays Commercial Bank Barclays Commercial Bank provides banking services to organisations with an annual turnover of more than £1m. Customers are served via a network of relationship and industry sector specialists, which provides solutions constructed from a comprehensive suite of banking products, support, expertise and services, including specialist asset financing and leasing facilities. Customers are also offered access to the products and expertise of other businesses in the Barclays Group, particularly Barclays Capital, Barclaycard and Barclays Wealth.
Barclaycard Barclaycard is a multi-brand credit card and consumer lending business which also processes card payments for retailers and merchants, and issues credit and charge cards to corporate customers and the UK government. It is one of Europe’s leading credit card businesses and has an increasing presence in the USA.
In the UK, Barclaycard comprises Barclaycard UK Cards, Barclaycard Partnerships (SkyCard, Thomas Cook, Argos and Solution Personal Finance), Barclays Partner Finance (formerly CFS) and FIRSTPLUS.
Outside the UK, Barclaycard provides credit cards in the USA, Germany, Spain, Italy and Portugal. In the Nordic region, Barclaycard operates through EnterCard, a joint venture with Swedbank.
Barclaycard works closely with other parts of the Group, including UK Retail Banking, Barclays Commercial Bank and other businesses within Global Retail and Commercial Banking, to leverage their distribution capabilities. GRCB Western Europe, GRCB Emerging Markets and Absa GRCB Western Europe, GRCB Emerging Markets and Absa provide banking services to Barclays personal and corporate customers outside the UK. The products and services offered to customers are tailored to meet customer needs and the regulatory and commercial environments within each country. These businesses also work closely with other parts of the Group to leverage synergies from product and service propositions.
GRCB Western Europe and GRCB Emerging Markets provide a range of banking services to retail and corporate customers in Europe and emerging markets, including current accounts, savings, investments, mortgages and loans. GRCB Western Europe includes Spain, Italy, France and Portugal. GRCB Emerging Markets includes operations in Africa, India and the Middle East.
Absa Group Limited, majority-owned by Barclays, is one of South Africa’s largest financial services organisations serving personal, commercial and corporate customers predominantly in South Africa. Absa serves retail customers through a variety of distribution channels and offers a full range of banking services including current and deposit accounts, mortgages, instalment finance, credit cards, bancassurance products and wealth management services. It also offers customised business solutions for commercial and large corporate customers.
Barclays Capital Barclays Capital is a leading global investment bank which provides large corporate, institutional and government clients with solutions to their financing and risk management needs.
Barclays Capital services a wide variety of client needs, from capital raising and managing foreign exchange, interest rate, equity and commodity risks, through to providing technical advice and expertise. Activities are organised into three principal areas: Rates, which includes fixed income, foreign exchange, commodities, emerging markets, money markets, prime services and equity products; Credit, which includes primary and secondary activities for loans and bonds for investment grade, high yield and emerging market credit, as well as hybrid capital products, asset-based finance, mortgage-backed securities, credit derivatives, structured capital markets and large asset leasing; and Private Equity. Barclays Capital includes Absa Capital, the investment banking business of Absa. Barclays Capital also works closely with all other parts of the Barclays Group to leverage synergies from client relationships and product capabilities.
Barclays Global Investors Barclays Global Investors (BGI) is one of the world’s largest asset managers and a leading global provider of investment management products and services.
BGI offers structured investment strategies such as indexing, global asset allocation and risk- controlled active products including hedge funds, and provides related investment services such as securities lending, cash management and portfolio transition services. In addition, BGI is the global leader in assets and products in the exchange-traded funds business, with more than 320 funds for institutions and individuals trading globally. BGI’s investment philosophy is founded on managing all dimensions of performance: a consistent focus on controlling risk, return and cost. BGI collaborates with the other Barclays businesses, particularly Barclays Capital and Barclays Wealth, to develop and market products and leverage capabilities to better serve the client base.
Barclays Wealth Barclays Wealth serves high net worth, affluent and intermediary clients worldwide, providing private banking, asset management, stockbroking, offshore banking, wealth structuring and financial planning services. It also manages the closed life assurance activities of Barclays and Woolwich in the UK.
Barclays Wealth provides tailored, regulated, financial planning advice on life, pensions and investment products and works closely with all other parts of the Barclays Group to leverage synergies from client relationships and product capabilities. We are committed to being carbon neutral globally in 2009 and have set tough standards to reduce Case studies our waste and increase our recycling. We are also stepping up our efforts to source our goods and services from suppliers that have the highest standards. We also want to ensure that we uphold • The environment human rights, in the projects that we finance, the communities in which we operate and among our employees. • Supply chain • Human rights An inclusive employer The environment Supply chain • Barclays is facing up to climate Emissions generated by • In the community change, increasing our efforts suppliers is key to companies' to reduce our direct and indirect impact on the indirect impacts environment
Human rights Inclusive employer We represent the financial It is important for us to find, sector on a number of human develop and retain the most rights programmes including talented people available the Business Leaders Initiative
In the community Our business will benefit from contributing to the development and sustainability of the communities where we operate The environment Climate change is one of the biggest challenges confronting the world. We must make our own contribution to managing this risk and we are stepping up our efforts to reduce both our direct and indirect impacts on the environment. Through our climate action strategy, we achieved carbon neutral status in our UK and European operations for 2007. Our strategy includes reducing CO2 emissions by improving energy efficiency, buying renewable energy where available, and offering products and services that help customers tackle their carbon emissions. Throughout 2007, Group Chief Executive John Varley and Group Chairman Marcus Agius have contributed to the climate change debate. We are one of the biggest providers of finance to the renewable energy One of 2007's most visible symbols of our commitment to reduce our carbon footprint is the new market. Absa Capital building in South Africa. Andrew Flett, Global Head of Environmental Sustainability, says: "The design and planning for this building has been a genuine Group-wide effort involving the Capital Projects, Engineering and Environmental teams, and it will set a new standard for sustainable building for the Group." Measures such as rainwater harvesting, solar heating, natural cooling, lighting sensors and recycled materials, will make the complex at Sandton Court, Johannesburg 34.2% more energy- efficient than a traditional office.
We've also developed a number of products and services to help clients in the institutional, commercial and retail markets manage their energy use and reduce their carbon footprints.
New environmental products In July, we launched Barclaycard Breathe, a credit card that incentivises consumers to buy greener products and donates half its profits to carbon reduction projects. We guaranteed that in the first year we will make a minimum donation of £1million to environmental projects. Our corporate card 1,352 equivalent is Barclaycard Business Sustain, originally developed for consultancy Deloitte, but since November available to all our corporate customers. It’s the first business card designed to help tonnes of CO a year will be saved at companies offset the carbon emissions of business air travel. 2 Absa Capital’s new building in Johannesburg. We're also making the carbon trading and risk management expertise of Barclays Capital available to our larger commercial clients. Barclays Capital is a leader in the EU emissions trading market, trading more than 600 million tonnes since 2005. We're now working with the UK government on improving Africa's access to global carbon finance and sitting on an expert government group on the future of London's carbon market. We are also investing in projects that reduce carbon emissions globally.
Barclays Commercial Bank is building its reputation in the renewable energy market. With colleagues in Spain, we are providing long-term finance for more than 2,700MW of renewable generating capacity, enough to supply electricity to more than 1.45 million homes for a year. Schemes range from small-scale hydroelectric projects to onshore wind farms. Key Performance Indicators
Global CO emissions by source 2007 2
1 Buildings electricity 85% 2 Business travel car 2% 3 Business travel air 13% Total: 100% 3 2 Business travel rail <1% 1
Environmental key performance indicators 2007
2006 2005 2007 2007 UK 2006 UK 2005 Measurement unit UK only Global only Global only Global 2000 Total emissions (from energy use in offices, buildings, data centres and business travel emissions from air, car and rail) tonnes 292,849 565,752 276,063 526,922 244,625 291,827 269,964 Total emissions taking into account renewable energy contracts(a) tonnes 149,463 422,365 276,048 526,907 n/a n/a (b) Carbon intensity tonnes CO2/£m 22.31 24.60 20.02 24.40 19.53 16.84 Energy use in offices and buildings per full-time equivalent employee KwH 7,525 5,845 7,650 6,319 7,380 4,816 Energy use in datacentres per meter sq. KwH 2,136 2,346 3,842 3,842(c) 3,693 3,693(c) Videoconferencing usage no of calls 3,687 73,587(d) 3,301 4,310 n/a n/a EMS coverage based on full-time equivalent employee % 100% 83% 100% n/a n/a n/a Data coverage based on full-time equivalent employee % 100% 92% 100% n/a n/a n/a Performance against UK climate change targets 2007
% change 2007 against performance Baseline baseline On track 1 – Reduce total emissions by 20% by 2010 against a 2000 baseline C02 emissions tonnes (without taking into account renewable energy contracts) 292,849 269,964 +8.48 NO C02 emissions tonnes (with UK renewable energy contracts)(a) 149,463 269,963 -44.64 YES 2 – Reduce carbon intensity of income by 20% by 2010 against a 2005 baseline (b) Carbon intensity tonnes C02/£m 22.31 19.53 +14.23 NO (a) Carbon intensity (with renewables contracts) tonnes C02/£m 11.39 19.53 -41.70 YES 3 – Reduce energy consumption from offices and data centres per employee by 20% by 2010 against a 2005 baseline Energy consumption KwH per full-time employee 7,525.00 7,380.00 +1.96 NO
Notes (a) Barclays aims to purchase electricity from renewable or low carbon sources. During 2007 we moved to a renewable tariff to cover approximately 50% of our total electricity use in the UK.
(b) Carbon intensity is calculated using UK income net of insurance claims.
(c) We are currently only able to seperate energy information from data centres for UK operations. We aim to continuously improve coverage and quality of our data.
(d) A new data stream from our investment banking operations provides more information on our videoconferencing data which wasn't available last year. The environment case studies
• Progress towards carbon neutrality • Our approach to offsetting • Energy efficiency • Greener business travel • Managing our direct environmental impact • Engaging stakeholders • Waste management in the UK • The environmental services offered by Barclays Commercial Bank • Absa’s environmental strategy and programme • Barclaycard in the US Case study Progress towards carbon neutrality
Our UK and European operations were fully carbon neutral for 2007. We now plan to extend this to the whole Group worldwide in 2009.
Increasing our energy efficiency and buying renewable energy are the main ways to do this. Our offsetting project in India helps Our remaining emissions are offset. to reduce emissions and to ensure sustainable development. We offset 173,000 tonnes of CO2 emissions to make our UK and European operations carbon neutral for 2007.
We know that offsetting is not a long-term solution to climate change, but we believe it has a valuable role to play. It provides a powerful financial incentive for investing in emissions reductions, because offsetting comes at an additional cost.
Our total UK and European emissions have been verified by emissions auditor SGS. Our full carbon accounting and offsetting policy explains how we calculate our carbon footprint and our approach to offsetting. It is available by email from [email protected]
The voluntary carbon offsetting market is evolving rapidly and new standards are emerging. We are playing an active part in these developments and when a universally-accepted standard emerges we will adopt it. In the meantime we will: • Use suppliers with a proven track record 173,000 • Invest in projects that produce the required emissions reductions within three years tonnes of CO offset for 2007. • Ensure that all emissions reductions are verified by a credible independent third party, preferably 2 one recognised by the United Nations Framework Convention on Climate Change (UNFCCC) • Give preference to projects that meet recognised standards and take place in countries where Barclays operates. Case study Our approach to offsetting
Barclays has offset its UK CO2 emissions in two ways:
The Clean Development Mechanism (CDM) The CDM is a mechanism under the Kyoto Protocol, which was introduced in 2005 to help countries Our offsetting project in India cut greenhouse gas emissions. CDM allows countries to meet their emissions reductions targets by provides solar panels to increase investing in clean technology in developing countries that do not have emissions targets. renewable energy.
These clean investments generate carbon credits called Certified Emissions Reductions (CERs), which are verified independently and approved by the United Nations Framework Convention on Climate Change. Barclays has purchased 80,000 tonnes of CERs through Barclays Capital’s Emissions Trading Desk.
Community energy projects We have also invested in community-based energy efficiency and renewable energy projects in Africa, China and India. This was done through our offset suppliers, The Carbon Neutral Company, First Climate and Climate Care.
These projects are small scale but have real social and economic benefits for local communities. They are monitored and verified independently.
One good example is the Lesotho cooking stoves project in southern Africa. This was designed to produce a lower carbon alternative to traditional wood-fired cooking stoves. Around 550 efficient new ‘Rocket Stoves’ have been installed in schools and orphanages covered by the World Food Programme.
The new stoves will help improve nutrition as well as reduce emissions. In some cases these stoves have achieved a 90% reduction in the amount of fuel needed to cook for 100 people. Each stove could save up to 10 tonnes of CO2 a year.
Renewable energy During 2007 Barclays agreed its biggest ever purchase of renewable energy in a three-year deal with EDF Energy. This increased our UK renewable energy use from 3% to 50%, reducing our CO2 emissions by up to 125,000 tonnes a year. In early 2008, we finalised another renewable deal with Scottish and Southern Energy which means that 100% of our current electricity needs in the UK are met through renewable sources.
Our long-term strategy is to find ways of securing the long-term provision of renewable energy to Barclays, and to incentivise the energy market to produce more renewables. 125,000
tonnes of CO2 reduced through purchasing renewable energy in 2007. Case study Energy efficiency
We have a number of different initiatives running to improve our energy efficiency in the UK. These include:
Virtual desktops at Barclays Capital Remote technology was installed in Unlike a conventional PC, a virtual desktop runs from a centrally located server. As a result, a bulky PC 90 UK branches to save energy. can be replaced by a small thin unit. This delivers an overall energy reduction of 75% compared to a conventional PC. The savings equate to £280,000 and 750 tonnes of carbon each year per 1,000 units.
More than 1,200 virtual desktops were installed by the end of 2007, with an additional 3,000 in Barclays Capital and an additional 1,000 in Absa Capital scheduled for 2008. Virtual desktops also greatly reduce the need for air conditioning as they produce less heat than a conventional PC.
The PC power save initiative In May 2007, all our PC monitors in Barclays Capital in the UK were set to enter standby mode after 15 minutes of inactivity. This reduces energy consumption and saves on the cost of air conditioning. By May 2008, this initiative is expected to have reduced our carbon emissions by 3,000 tonnes and saved over £1.5million in energy costs.
UK retail branches We are now using remote technology to monitor and adjust the heating boilers in our branches from a single location. This means they use less energy and can be turned off when necessary.
We installed this system in 90 branches in 2007, cutting our gas bills by over £160,000 and saving the equivalent of 1,349 tonnes of CO2. We have now committed to put remote monitoring into all of our branches by the end of 2010.
Head Office heating Adjustments to the control systems for the boilers at Barclays Head Office led to a 45% reduction in gas consumption and a 2007 saving of 1.8GW. 34% energy savings of Absa Capital's new building Case study Greener business travel
Business travel covers journeys by air and on the roads – and we've taken steps to reduce the need for travel altogether.
By air Barclays employees can take Barclays is a member of the Institute of Travel Management 'Project Icarus Group', which was set up to advantage of the Bike to Work tackle the issue of carbon emissions associated with air travel. The project has developed a set of scheme. voluntary corporate standards to raise the understanding of environmental issues in business travel and encourage best practice.
There are three levels of involvement and our UK businesses have signed up for Bronze – Option B. This commits companies to: 73,587 Establish a baseline for measuring travel-related CO2 emissions • videoconferencing calls made • Implement a measurement methodology globally in 2007. • Demonstrate a reduction in CO2 of at least 2.11% per traveller per year over two years and identify targets over the following two years • State longer-term goals and strategy for the next 5-10 years.
On the roads We’re supporting the UK government’s 'Bike to Work' scheme. This has been introduced for employees working in Barclays Wealth and Barclays Capital buildings in the UK and will be offered to the other UK businesses in 2008.
Virtual alternatives We're encouraging more extensive use of videoconferencing to replace the need for business travel.
In 2007, we installed systems in our four main sites in the UK: 1 Churchill Place in London, Radbroke Hall in Cheshire, Westwood Park in Coventry and Barclays House in Poole.
Many of our investment banking and investment management sites around the world also have this technology.
In 2008, we will identify the main international sites that generate the highest volumes of business travel. Case study Managing our direct environmental impact
Barclays is developing Group-wide Environmental Management Systems (EMS) which have been certified to ISO 14001.
With a large network of offices globally it is important to reduce our direct environmental footprint by Absa Capital’s new headquarters is reducing the energy consumption and waste in our buildings. We do this either through changing setting new standards in energy aspects of our existing buildings – known as retrofitting – or by designing and developing new efficiency. buildings that meet higher environmental standards.
The new Absa Capital building under development in Johannesburg is a good example. These new premises are being adapted from a 1970s office block to meet our current environmental standards. The building's existing façade has been stripped and replaced with state-of-the-art, double-glazed walls which are uncommon in South African office buildings. Solar panels will heat water for many of the building's washrooms and sensor lighting will be installed which automatically switches off when there is no movement in the room. External landscaping will introduce indigenous planting to retain rainwater and provide irrigation during most of the dry season. We have also sourced many of the building materials locally to reduce the environmental impacts of converting the building. Other features in the building include:
• Energy-efficient light fittings – a 43% improvement over standard fittings • Dual-flush toilets in bathrooms to reduce water consumption 100% • Use of recycled material in building finishes, with all wood veneers from sustainable sources. of UK operations covered by an environmental management We have also supported our businesses to apply for independent certification to ISO. At present system Barclaycard UK together with Barclays operations in France and Portugal, have all achieved their own ISO. Parts of Absa and our Spanish business have also been certified to the same standard.
Barclays Capital and Barclays Wealth have extended their EMS and implemented a new governance structure to include working groups from Barclays Capital in the UK, Europe, the Middle East, Africa, Asia Pacific and the Americas, and one from Barclays Wealth. The system now fully covers both businesses.
In total, 83% of our global operations are covered by an EMS, with environmental data being received from over 92%. Our main gap is in establishing an EMS in Africa and our goal is to have 100% EMS coverage by the end of 2009. Case study Engaging stakeholders
In 2007, Barclays worked with the publisher Rough Guides to produce the Rough Guide to Saving Energy and Reducing Your Carbon Footprint.
The 64-page book is full of information explaining the challenge of climate change and how to reduce Our Rough Guide to Saving Energy. carbon emissions both at work and at home. It also illustrates how individuals can make a difference through seemingly unrelated issues, such as their choice of holiday and the food they eat.
It was given to 60,000 Barclays employees and its publication has prompted other stakeholders to produce a similar book for their companies.
In 2007, we were also one of the sponsors of the Prince of Wales’s May Day Business Summit on Climate Change. The event brought together more than 1,200 business leaders to agree action on 173,000 tackling global warming. tonnes of CO2 emissions offset in the UK and Europe. In addition, Barclays Chairman Marcus Agius, is a member of the Confederation of British Industry’s Climate Change Task Force. The taskforce aims to set the agenda for business action on climate change.
Its first step was to commission a global climate change study from consultants McKinsey, to assess the economic options for reducing greenhouse gas emissions. The report was published in November 2007.
The findings concluded that the UK government’s 2050 goals can be achieved at a manageable cost, provided there is an increase in the scale and speed of activity. It also estimated that by 2030, the UK will have to more than double the energy efficiency of its economy, and more than halve the carbon content of its energy if it is to reach the 2050 goals.
Changes of this scale will only happen if the UK’s government, businesses and consumers work together – it must become a shared national priority.
Marcus Agius explains: “Climate change is the challenge of our generation. Its impacts will of course not be felt by this generation alone, but the tenor of our response will determine the environmental and economic climate of the world to come.”
Barclays is working with governments internationally to find market-based solutions to mitigate climate change and adapt to its impact. Case study Waste management in the UK
In 2007, we worked harder to address our direct environmental impacts in the UK. At Gadbrook Park, we developed a green agenda of local awareness and held initiatives throughout the year. In Poole, site champions were established together with a newsletter and intranet site. Also in A ‘reverse vending’ machine at one 2007, contact centre champions were established in all sites with our Liverpool site now having of Barclays Capital’s London offices. representatives in each office block.
We also carried out a range of other activities:
• Retail Operations sent 23,000 unused marketing t-shirts to World Jewish Relief • Westwood Park implemented a recycling scheme for colleagues who live too far away from council facilities • The weekly actions report to branches migrated from paper to our intranet, saving 20,000 printed copies a week • The Local Business Change team set up an alert on our computer systems which automated some customer checks saving more than one million pieces of paper a year • Barclays Commercial Bank launched a Paper Report Switch-Off Campaign – a five-week environmental campaign to halt the printing of unnecessary paper reports • Our Enviromental Champions’ Handbook was revised and reissued • We celebrated World Environment Day on 6 June with roadshows at sites around the UK, manned by champions and representatives from local Energy Efficiency Centres and the Environment 1,352 Agency tonnes of CO2 a year will be saved • Our Woodland Trust mobile phone recycling campaign collected 2,314 old phones raising £5,875. at Absa Capital’s new building in In Barclays Capital’s London offices a recycling drive increased recycled waste volumes by 652% Johannesburg. saving the equivalent of enough energy to power 15,000 60w light bulbs for a year. Confidential paper waste recycling increased 127% saving the equivalent annual energy consumption of 53 three- bedroom homes. In our North American operations, switching pitch books from A4 to A5 double- sided has reduced paper consumption by 29% per full-time employee compared to our 2005 figures.
Barclays Capital also installed a ‘reverse vending’ machine as part of a trial at its Bank Street office in London, which automatically takes cans and plastic bottles and crushes them ready to be collected for recycling. The trial, which was the first in a UK corporate office, proved successful, with a high volume of material recycled. Case study The environmental services offered by Barclays Commercial Bank
Our commercial customers in the UK can now access a whole range of dedicated environmental services. These include access to: Barclays Commercial launched in • Barclays Capital’s carbon emissions trading expertise 2007 with a suite of environment • Our exclusive European Investment Bank cashback scheme. This is available to businesses for products. environmentally efficient capital expenditure projects between £200,000 and £17million. In 2007, around 80 customers received cashback payments totalling around £600,000 • Free advice on saving money by reducing energy, water and waste. This is offered by Envirowise, a government-funded programme that aims to put the sustainable use of resources at the heart of UK business practice • Robust and cost-effective environmental liability insurance through Marsh, a leading insurance broker and strategic risk advisor • Guidance on environmental legislation • Advice on making the most of Enhanced Capital Allowances which enable businesses to claim 100% first-year capital allowances on their spending on qualifying plant and machinery 1,352 • Free business carbon calculators and a guide to carbon offsetting tonnes of CO2 a year will be saved at • A step-by-step guide to managing environmental impact for SMEs. Absa Capital’s new building in Chris Grigg, Chief Executive of Barclays Commercial Bank says: “Developing more sustainable Johannesburg. business practices and reducing environmental impact should be a priority for all businesses. The bottom-line benefits of operating more responsibly are becoming clearer by the day.”
In 2007, Barclays Commercial Bank launched a dedicated environmental website for corporate customers. The interactive site provides useful sources of expertise and information including details of our environment-related products. Case study Absa's environmental strategy and programme
Absa's environmental strategy aligns with Barclays approach. Absa has also implemented an environmental management system certified to ISO 14001 standard. Absa offers customers energy Absa is improving energy efficiency, reducing waste and water usage, and recycling more to reduce its saving home loans. carbon footprint.
Absa's project finance transactions are approved in line with the Equator Principles criteria, and other corporate lending reflects Barclays established environmental risk management processes.
Absa is a sponsor of the Peace Parks conservation initiative, investing R10million over 10 years. The project is supported by President Thabo Mbeki, and involves training more than 10,000 game rangers, field guides, wildlife veterinarians and guest house managers. Peace Parks supports sustainable economic development, the conservation of biodiversity and regional peace and stability in southern Africa by facilitating the establishment of Peace Parks or transfrontier conservation areas (TFCAs) in the region.
Absa also supports the Southern African Wildlife College in Hoedspruit and the Southern African College for Tourism in Graaff-Reinet. 1,352 tonnes of CO a year will be saved at Absa is also involved with the Roundabout PlayPumps initiative in South Africa. The PlayPump is a 2 Absa Capital’s new building in playground roundabout that drives conventional water bore hole pumps. The pump is powered by the Johannesburg. movement of the roundabout. Using money from Absa's employee Give As You Earn programme, between October 2006 and March 2007, we provided funding to install 30 roundabouts.
South Africa is currently facing an energy crisis as growing demand has overtaken supply. In response, Absa Home Loans launched an energy efficiency campaign in partnership with a supplier who offered a 10% discount on products such as solar water heating, efficient lighting and home insulation. Case study Barclaycard in the US
Barclaycard’s new building in Wilmington has a ‘green roof’, with 80% of the rooftop covered in sedum plants.
This increases our energy efficiency on the top floors. The building is also designed to make the most Our Wilmington building has a of natural light, reducing energy consumption. green roof to increase energy efficiency.
83% of our global business is covered by our Environmental Management Systems. Supply chain The carbon emissions generated by suppliers is an increasingly important element of every company’s indirect impacts on the environment. Barclays engages with suppliers to promote responsible practice in this area. In 2007, we held a special forum for eight major suppliers accounting for around 4% of our UK spend, followed by individual discussions to ascertain the proportion of their emissions attributable to us. We We are taking steps to reduce the are now working with these suppliers to identify ways to help them reduce these emissions, and have environmental impact of our supply set up a working group to oversee this programme. chain.
During our selection process, we ask selected suppliers to provide information about their social and ethical performance, as well as their environmental track record. This information forms part of our selection decision.
In 2007, Absa adapted our questionnaire for suppliers in its local market. A first for a company of Absa’s size in South Africa, the questionnaire will go to 35 top suppliers initially. 25,000 We have more than 25,000 suppliers globally. Key performance indicators Global Sourcing 25,000+ 10,000 Number of suppliers suppliers provide 90% of third-party spend
2007 2006 Payments to our suppliers Approx £7bn Approx £4.9bn
Supplier management in South Africa The Financial Sector Charter target for Absa is to have 50% (weighted spend) of its qualifying third- party spend going to Black Economic Empowerment-rated suppliers by 2008.
2007 2006 Qualifying spend going to Black Economic 62% 55% Empowerment companies Supply chain case studies
• Absa’s new supplier questionnaire • Our policy on forced, compulsory and child labour Case study Absa’s new supplier questionnaire
Absa's supplier questionnaire is part All major Absa suppliers must complete a questionnaire as part of our screening process. of our supplier screening. Absa requires all strategic and some operational suppliers to complete the questionnaire. This assesses each organisation against three criteria:
• Human rights • Environmental impact, and • Business integrity.
In South Africa, in order to overcome inequalities, the government encourages businesses to place their business with a certain number of black-owned firms. Absa is one of the leading businesses to support the government scheme. Absa significantly increased the proportion of its spend with Black Economic Empowerment (BEE) companies in 2007.
The Financial Sector Charter target for Absa is to have 50% of its qualifying third-party spend going to BEE-rated suppliers by 2008. Absa has exceeded that target a year ahead of schedule, with 62% 10,000 of spend going to BEE companies during 2007. suppliers account for 90% of third-party spend. Case study Child, forced and compulsory labour policy
Barclays supplier screening process includes a human rights component. This addresses the issue of child labour. We aim to have no child labour in any part of our supply chain. We don't employ anyone under 16 We have a policy that we won't employ anyone under 16 years of age. years of age.
However, the issues are complex, and in some markets children may, for example, be supporting the rest of their family. In circumstances such as these we would be careful not to force the children out of their existing jobs and into worse conditions. We would work with the supplier to ensure that any children involved are treated well, and have access to education.
Our supplier screening process also seeks to ensure there is no forced or compulsory labour in our supply chain. 10,000 suppliers account for 90% of third-party spend. Human rights We have been representing the banking sector on the Business Leaders Initiative on Human Rights since 2003, and promoting greater awareness of these issues to the wider financial services community. Since October 2006, we've also co-led the workstream on human rights for the United Nations Environment Programme Finance Initiative, a global alliance of more than 160 financial institutions.
During 2007, we worked with a team of 11 other financial institutions to develop an online resource for banks on the human rights issues associated with lending. This is a complex area covering many We have worked with the UN to different issues. The resource is designed to be practically structured and commercial, helping lenders develop guidance for our sector. identify potential risks and evaluate ways they might be reduced or managed. It covers the issues to watch for in specific sectors, which might range from health and safety, to poverty and sustainable development. Human rights case studies
• Our work with unions • Our new deal on cleaners’ pay Case study Our work with unions
We support the rights of employees to engage in trade union activities, and recognise unions, employee councils and employee associations in more than 20 countries worldwide.
In our two largest markets, the UK and South Africa, we have reached progressive partnership UNI recognised our efforts to work agreements with the major trade unions. Where unions do not exist, we liaise with works councils with trade unions. and employee associations, and engage directly with our employees. However, in some countries unions are either not strong or even illegal. In Africa, we have developed a Pan-African forum to work constructively with our colleagues, whilst in Europe we have the Barclays Group European forum which brings together colleagues from across our European businesses.
In a recent survey published in September by Union Network International (UNI), Barclays was rated the best of 25 major financial institutions in relation to union rights and freedom of association.
In May 2007, we signed an agreement, called The Pledge, between Absa and its recognised trade union SASBO in South Africa. The agreement is based on our UK Partnership Principles approach to managing industrial relations. Case study Our new deal on cleaners' pay
In June 2007, Barclays introduced a market-leading base pay rate of £7.50 per hour for its third-party employees working in Greater London.
Around 1,000 cleaning, mailroom, gym and catering employees working across 370 Barclays We have increased our contractors branches and offices throughout London directly benefit from the increase, which came into pay as part of our commitment to all effect on 1 July 2007. those who work for Barclays.
This means Barclays hourly base rate is £1.98 per hour higher than the UK government's minimum wage of £5.52 and 30p per hour more than the London Living Wage recommended in 2007 by the Mayor of London Ken Livingstone.
Although the employees who benefit are not directly employed by Barclays, we believe we have a responsibility to ensure that they receive a fair, well-rounded remuneration package.
Barclays worked with union Unite (Amicus section) to introduce the increase, which equates to a 20% rise for some employees. 20% Our new pay deal for cleaners Atkins Asset Management and Johnson Controls manage Barclays suppliers in Greater London. equated to a 20% rise for some. The suppliers involved in the deal include Mitie, Lancaster, Initial, Mail Source, Restaurant Associates, Ararmark, Bannatyne's and Baxter Storey.
The deal followed our work with the Transport and General Workers Union in 2006 when we developed a new pay and benefits package for cleaners in our UK branch network. An inclusive employer In an intensely competitive industry it is important for us to find, develop and retain the most talented people available. Organisations hoping to achieve global ambitions need to bring together different cultural and international perspectives, and draw on the ideas of the widest possible range of people. Our Executive Diversity Group meets three times a year under the leadership of Group Vice Chairman Gary Hoffman to monitor our businesses’ progress against diversity action plans. In 2007, we moved our diversity specialists from our corporate centre into the businesses, where they can be more directly involved in decision making. As we grow our workforce becomes more diverse. We also changed the way we recruit at graduate level in our UK retail operations, resulting in a more diverse intake for 2007.
We have a wide range of development and leadership programmes for employees including sponsorship of a Chicago Graduate School of Business Executive MBA and intern programmes. Our policies ensure that employees are all treated with respect regardless of age, race, sexual orientation, gender, disability, religion or belief.
Becoming more diverse As we grow internationally our workforce is becoming more diverse, reflecting our worldwide presence. We are determined to hire employees from the communities in which we operate, as this not only helps those communities prosper through job creation but gives us local understanding of customer needs. The percentage of ethnic minority employees in our UK businesses has increased from 7.2% in 2001 to 12.3% in 2007.
We made further investments, in 2007, in disability mentoring to enhance career prospects and 'reasonable adjustments’ schemes to improve working environments for disabled colleagues. We 19% need to work harder on making these schemes accessible by identifying and removing obstacles to of UK Retail Banking graduate career progression. We also introduced a new helpline for disabled colleagues and Group Chief trainees were from ethnic minorities Executive John Varley hosted two sessions of our Disability Listening Group. in 2007, up from 8% in 2005. We recognise that we have work to do on developing and recruiting more women for senior jobs. All of our businesses now have robust plans in place to improve in this area. In 2007, mentoring schemes were set up across our retail and commercial banking businesses and Women’s Networks in Barclays Capital and BGI continued to grow. In Barclays Wealth there are dedicated programmes for high- potential women. Key performance indicators Human resources data tables Barclays – an international picture 2007(a) 2006(b) 2005 Global employment statistics FTE 134,900 122,600 113,300 Total employee headcount 141,885 133,529 126,000 Percentage of female employees 56.3% 60.6% 61.9% Percentage of female senior executives 13.7% 12.2% n/a Percentage of female senior managers 20.6% 20.8% n/a Percentage working part time 12.4% 13.6% 15.4% Turnover rate 18.3% 16.9% 17.% Resignation rate 12.3% 10.9% 10.9% Sickness absence rate 3.0% 3.6% n/a FTE by world region UK 61,900 62,530 60,103 Africa & Middle East 51,748 44,326 40,134 Continental Europe 9,750 8,100 7,616 Americas 6,413 4,905 3,916 Asia Pacific 5,088 2,739 1,531 Total 134,900 122,600 113,300 Notes (a) 2007 UK data – includes BGI employees (b) 2006 UK data – excludes 800 BGI employees Barclays UK employees 2007 2006 2005 2004 2003 UK employment statistics Total employee headcount 67,115 69,023 66,566 66,663 65,234 Average length of service (years) 9.7 9.8 10.2 10.5 11.00 Percentage working part time 16.8% 21.8% 23.7% 24.6% 25.1% Sickness absence rate 3.0% 4.0% 4.2% 4.4% 5.0% Turnover rate 16.6% 19.0% 20.0% 19.3% 20.0% Resignation rate 11.1% 12.0% 11.5% 11.8% 12.0% Women in Barclays Percentage of all employees 58.0% 61.0% 62.2% 63.4% 64.0% Percentage of management grades 28.4% 33.0% 30.9% 30.5% 29.4% Percentage of senior executives 13.0% 12.9% 10.9% 10.5% 11.4% Ethnic minorities in Barclays Percentage of all employees 12.3% 12.7% 11.3% 10.5% 9.0% Percentage of management grades 10.0% 8.1% 7.1% 7.0% 6.3% Percentage of senior executives 6.6% 6.1% 3.6% 3.3% 3.7% Disabled employees in Barclays Percentage of all employees 3.4% 3.8% 3.4% 3.2% 3.0% Age profile Employees aged under 25 16.5% 17.4% 17.1% 17.5% 16.0% Employees aged 25-29 17.0% 15.9% 15.0% 13.9% 12.9% Employees aged 30-49 54.2% 56.0% 57.3% 58.6% 61.0% Employees aged 50+ 10.3% 10.7% 10.5% 10.0% 10.1% Pensions Barclays Bank UK Retirement Fund active members 53,473 55,558 55,608 60,837 62,761 Current pensioners 48,607 43,754 42,258 40,926 39,296 Notes All global headcount and FTE numbers relate to direct employees therefore excluding agency employees and contractors. All employee statistics relating to Barclays PLC UK in 2006, excludes BGI – Barclays Global Investors (approx 800 UK employees). All data as at 31 December 2007, except pensions data for 2006 which is as at 30 September 2006. Percentage of disabled employees is derived using responses to the GRCB and Central Support Employee Opinion Survey, 84% of the UK population. Sickness absence percentage excludes Barclays Capital population. (c) Headcount base corresponding with UK FTE (full-time equivalent)
Employee Opinion Surveys Positive Scores 2007 GRCB 2006 GRCB Participation Rate 90% 87% Proud to work for Barclays 82% 84% Perceptions of Leadership 59% 62%
2007 GRCB 2006 GRCB Employee Engagement 74% 76% Barclays operates with integrity 85% 84% Environmentally responsible 78% 77% Socially responsible 82% 83% Other Engagement Barclays Capital The Employee Opinion Survey is conducted less frequently within Barclays Capital as a varied approach to gaining feedback is used. Through continuous engagement with our employee networks we have identified specific areas of improvement that we are working towards. Initiatives include, enhanced maternity guidelines for managers, accessibility audits, bespoke training for network members to help them through their careers and to provide two-way learning across the business. Outside of the employee networks, we have conducted focus groups within specific business areas looking at the level of cultural awareness and virtual team management skills across the firm. This has resulted in piloting a new "Working Globally” course in Asia Pacific and the UK. Direct feedback and open discussions with our employees have provided us with development areas within the firm and have helped us set the direction of our "people agenda” for 2008.
Barclays Wealth Barclays Wealth has implemented two full Employee Opinion Surveys since its creation in October 2006. These measure the opinions of our employees globally. Business Unit Improvement Forums are then established for each business area, responsible for putting in place, and then implementing throughout the year, a plan of action to address some of the key issues arising from the survey. In addition, our largest employee function; Operations (with more then 2,000 employees) does quarterly mini-surveys to track areas of improvement it is focusing on.
Barclays Global Investors BGI uses an Employee Opinion Survey to measure the firm's progress in variety of areas, including Employee Engagement. A comprehensive questionnaire is administered biennially with an abbreviated checkpoint survey conducted in alternate years. Firm-wide participation is historically strong. In 2007, the firm scored particularly well with respect to support for the organisation's values and goals, and in the quality of working relationships. Career development was indicated as a key area for focus. Additional efforts to collect feedback consistently across the various departments and regions are underway. In Europe, for example, the firm combined focus groups with a survey to better understand and address the needs of our diverse employee base. In the USA, focus group sessions were hosted to enhance our efforts to attract, retain and develop women employees. And last year the firm sponsored a number of new affinity groups, such as the LGBT network in the USA and a women's network in Australia. Input from all of these, is being used to inform and enhance our employee engagement activities in 2008. 36% 4,200 Hourly wages for third-party Barclays Wellness employees working in Programme in South Africa Greater London are 36% has helped more than 4,200 higher than minimum wage employees establish their thanks to a rise to £7.50 per HIV status, making early hour. intervention much easier. Absa staff split Absa has continued to make good progress in developing a more diverse workforce.
Occupational levels Designated Non-designated Total Foreign Male Female Male nationals African Black Indian African Black Indian White White Male Female Top management 20075012110280038 2006 5012110241035 Senior management 2007 35 14 31 11 7 13 56 309 12 2 490 2006 29 10 25 8 3 6 48 277 6 2 414 Professionally qualified and 2007 652 343 526 496 352 522 2,221 3,297 15 26 8,450 experienced specialists and 2006 556 291 458 381 298 418 2,027 3,201 29 41 7,700 middle-management Skilled technical and 2007 1,321 894 417 2,501 2, 001 949 4,750 1,090 5 23 13,951 academically qualified workers, 2006 1,124 786 402 1,951 1,762 886 4,912 1,128 9 61 13,021 junior management, supervisors, foremen and superintendents Semi-skilled and discretionary 2007 1,658 736 212 3,839 2,217 561 2,266 360 0 18 11,867 decision-making 2006 1,581 827 224 3,407 2,356 606 2,719 416 0 22 12,158 Unskilled and defined 2007481111272320000212 decision-making 2006 57 12 1 129 28 40000231 Total – permanent employees 2007 3,719 1, 998 1,188 6,976 4,601 2,048 9,293 5,084 32 69 35,008 2006 3,352 1,926 1,111 5,878 4,448 1,921 9,706 5,046 45 126 33,559 Non-permanent employees 2007 78 32 14 189 78 15 224 156 0 0 786 2006 182 145 76 348 325 80 524 283 0 0 1 963 Total employees 2007 3,797 2,030 1,202 7,165 4,679 2,063 9,517 5,240 32 69 35,794 2006 3,534 2,071 1,187 6,226 4,773 2,001 10,230 5,329 45 126 35,522
“Designated groups” means Black people (i.e. Africans, Coloureds and Indians), women and people with disabilities who are natural persons and are citizens of the Republic of South Africa by birth or descent; or are citizens of the Republic of South Africa by naturalisation before the commencement date of the Constitution of the Republic of South Africa Act of 1993; or became citizens of the Republic of South Africa after the commencement date of the Constitution of the Republic of South Africa Act of 1993, but who, but for Apartheid policy that had been in place prior to that date, would have been entitled to acquire citizenship by naturalisation prior to that date.
“Non-designated groups” fall outside this definition. An inclusive employer case studies
• Live Well, Work Well in South Africa • Gender equality • Increasing cultural awareness in Barclays Capital • Recruiting from the widest talent pool • Our partnerships with gay and lesbian organisations • Our programmes for disabled colleagues • Barclays Women of the Year Internal Award Case study Live Well, Work Well in South Africa
Our 'Live Well, Work Well' programme is one of the most successful employee HIV/AIDS programmes in Africa. It succeeds because we refuse to accept the stigma of HIV/AIDS. Absa has worked to reduce the Our managing directors across the continent have taken the lead by getting themselves tested for HIV, stigma of HIV/AIDS. and publicly supporting our "Project I Know" campaign. This is backed by a comprehensive education and healthcare programme at our Wellness Centres, based on three simple ideas: prevention, treatment and coping.
We offer voluntary testing for HIV and counselling to all employees. This is free and confidential, as is our employee helpline. When test results are negative colleagues are encouraged to protect themselves and stay negative. When results are positive, we support our colleagues with guidance on healthy lifestyles, and free anti-retroviral treatment. Up to three members of their family can also have this free treatment.
We also try to break down damaging stereotypes and create a supportive working environment for everyone, whatever their HIV status. Trade unions have a big role to play here, and their support 4,200 for testing, in particular, has made a huge difference to the numbers of employees taking part in employees have established their our initiative. HIV status through Absa’s Live Well, Work Well programme. Case study Gender equality
The Equality and Diversity Team in Barclays France was recognised for its work on gender equality in our 2007 Chairman’s Awards. The team won the Equality and Diversity Achievement of the Year category. The Equality and Diversity Team in Barclays France, with Barclays Programmes to promote gender equality are not commonly found in France, but this team ensured Group Chairman Marcus Agius that’s not the case at Barclays. A gender champion was appointed and six team leaders each hosted a (far left) and Trevor Phillips of ‘listening lunch’ with senior women to hear their views on how best to address gender inequality. the Equality and Human Rights Dedicated groups were established within Barclays France to focus on work-life balance, identifying Commission (far right). and developing talented women, and creating a mentoring programme for them. The team also organised sponsorships of events such as the Women’s Forum for the Economy and Society in Deauville. Partnerships were also formed with three organisations that support girls’ education for International Women’s Day 2007.
This work in France is only one example of what we are doing to increase the number of senior women in Barclays. Each Business Unit has a gender action plan that is reviewed by our Executive Diversity Group every six months.
In Barclaycard, we are ensuring that all high performing women up to the most senior levels have coaches or mentors. A transparent "talent" agenda has also been established to ensure that talented women in senior roles are nurtured, developed and given opportunities for promotion. They have development plans, in line with our Performance Development process, which are reviewed twice a year. 56.3% of our employees globally are female. Case study Increasing cultural awareness in Barclays Capital
Linking strongly into the Global business strategy, Barclays Capital recognised the need to re-energise its Cultural Awareness Network. The Network was relaunched in September 2007, headed up by two senior chairs and two senior sponsors within the business. The Cultural Awareness Network The mission of the network is simple: "To increase the cultural awareness of the firm’s employees was relaunched in September. allowing them to build deeper and more fruitful relationships with their clients and colleagues from around the world".
Since the relaunch, the network has seen a 10-fold increase in employee membership. The first initiative was a Celebration of South Asian Culture which was run by members of the network and provided our employees with an educational leaflet on South Asian cultures and festivals as well as the opportunity to sample Asian food.
A number of celebrations are planned for 2008 covering diverse events such as Chinese New Year, St Patrick's Day and a Vaisakhi Event celebrating Punjabi culture.
With our clients based across the globe and an employee base of more than 100 nationalities, 12.3% Barclays Capital recognises the importance of valuing, understanding and educating our employees of our employees in the UK are from on the many different and vibrant cultures across the world. ethnic minorities. Case study Recruiting from the widest talent pool
Graduate recruitment is a key part of recruiting and developing Barclays Capital’s future leaders. Bob Diamond with members of one Working in partnership with our campus recruitment teams, our employee networks and the diversity of our women’s networks. team play an important role in helping us find the most talented graduates from the widest talent pool.
In 2007, Barclays Capital reached out to some of the most talented graduates through UK programmes such as:
• Sponsors for Educational Opportunity • Elevation Network • Inside & Out • Investability.
In addition to supporting these organisations, Barclays Capital invites colleagues from across the firm and from our employee networks to share their experiences with potential graduate recruits during open days and social evenings. This provides students with direct access to our employees so they can learn more about what it means to earn success at Barclays Capital.
In 2005, more than two-thirds of the 28 graduates on our UK Retail Banking graduate programme were men. In contrast, more than half of our 38 graduates were women in 2007 following our efforts 20.6% to increase the diversity of our graduate recruitment. The UK Retail Banking Human Resources team of senior managers are women. changed our approach by:
• Changing the marketing of our graduate recruitment scheme to make it more accessible and appealing to women • Involving male and female assessors, removing any perceived bias, and ensuring they had all undergone our online diversity training. Case study Our partnerships with gay and lesbian organisations
Our partnership with Stonewall, the campaigning organisation for gay, lesbian, and bisexual people in the UK, was the first of its kind in the financial sector.
We’ve sponsored Stonewall’s annual awards for two years and will do so again in 2008. The awards We have signed a one-year celebrate the whole range of positive contributions people and institutions make to gay Britain. sponsorship deal with Stonewall In 2007, we also sponsored a ‘Barclays Community Group of the Year’ award, which was won, Football Club. along with a £5,000 donation, by the London Lesbian and Gay Switchboard.
Stonewall Workplace Equality Index Barclays was again ranked in the top 20 of Stonewall’s 100 top employers for lesbian, gay and bisexual employees in 2007. The top 100 employers were ranked according to criteria ranging from implementation of effective equality policies to demonstration of good practice in recruitment and mentoring. Barclays was ranked 17 and scored 86% in the 20-question survey, designed to measure equality in the workplace.
Sponsorship of Stonewall Football Club In 2007, we signed a one-year sponsorship of Stonewall Football Club, the UK’s first club for gay footballers. As well as being title sponsor of Stonewall FC’s three teams, we provide kit and equipment for the club. In return, Stonewall FC will be involved in our equality and diversity programme, building on our status as the best gay-friendly bank or financial institution in the UK, as voted by The Pink Paper in 2006.
Stonewall FC Chairman, Liam Jarneki, says: "Barclays investment is a fantastic opportunity for Stonewall FC to develop in the build up to the Gay World Cup in London in 2008. Our aim is to help promote an environment where everyone can enjoy playing football, regardless of sexual orientation.” 86% Barclays score in Stonewall's survey Supporting Employees on equality in the workplace. Aside from our partnership with Stonewall, we also supported employee floats in the London, Manchester and Brighton Pride parades in 2007, and sponsored the Brighton Pride Community Village. Case study Our programmes for disabled colleagues
We have three main programmes to help our disabled colleagues which cover improving facilities at work, recruitment and development.
Facilities at work With reasonable adjustments Our ‘Reasonable Adjustments’ scheme makes the workplace more accessible for disabled employees colleagues can make changes to and allows them to fulfill their potential. Since 2005, more than 2,500 of these adjustments have been their working environment to meet made. They include simple but effective changes to our colleagues' working environment from their needs. changes to seating and lighting to arranging sign language interpreters for meetings. We have also completed a project to provide an enhanced service for people with complex IT needs.
Another element here is ongoing support for disabled colleagues and their line managers. We now have a dedicated disability helpline and a One-Stop-Shop disability intranet portal, which brings together all the information our employees need in a concise and user-friendly format.
Recruitment We've overhauled our approach to recruitment across the Group from graduate recruitment to entry- level positions.
In 2007, we recruited five disabled graduates to our UK Banking graduate training schemes in GRCB, and took on another 10 disabled undergraduates as part of our internship programme.
UK Retail Banking continued to build on the success of ‘Recruitment That Works’ in 2007. The scheme aims to recruit people with disabilities who have been out of work for a long time. The scheme was run 3.4% at our Manchester Contact Centre in 2007 with further sites planned for 2008. of colleagues in the UK have a Developing and retaining colleagues disability. There are three major initiatives here. The first is the Disability Mentoring Scheme, which offers every disabled employee a trained mentor. Since 2005, approximately 25% of our disabled colleagues have taken up this offer.
There’s also Group Chief Executive John Varley’s Disability Listening Group, which meets twice a year, and the ‘Reach’ employee network which helps disabled colleagues with career development and social networking. Case study Barclays Women of the Year Internal Award
The Barclays Women of the Year Internal Awards recognise inspirational and extraordinary UK-based women who have demonstrated excellence in their field, either personally or Barclays 2007 Women of the Year professionally, and who have made a difference. Internal Award winners with The Awards were launched in 2007 to coincide with Barclays sponsorship of the overall Woman of the Deanna Oppenheimer and Sister Year Award at the Women of the Year Lunch and Assembly. This UK event recognises the Frances Dominica. achievements, often against the odds, of women around the world. Deanna Oppenheimer, Chief Executive, UK Retail Banking presented the award to Sister Frances Dominica, founder of Helen and Douglas House, the first children's hospice in the world, which provides care to children with life- limiting illnesses.
56.3% of our employees globally are female. In the community Investing in the community is an important part of Barclays sustainability strategy. We believe our business will benefit from contributing to the development and sustainability of the communities where we operate. In 2007, we invested £52.4million in community projects around the world, and more than 43,000 colleagues in 29 countries were involved in our fundraising and volunteering initiatives.
We also made a step change towards globalising our community investment. As we grow outside the UK, our community investment should reflect that growing presence. In 2007, our investment outside Barclays Spaces for Sport has the UK increased from 15% of the total (£6.9m) to 26% (£13.5m). invested £30m in community sports in the last three years. In 2008, the Another change in 2007 was giving more responsibility for budget allocations and spending to the programme goes global. different areas of our business. Within our overarching community investment framework, businesses can decide the causes which matter most in their communities – from tackling malaria in East Africa to helping reduce debt among elderly people in the UK.
Banking on Brighter Futures In October, we committed to invest $150m over the next five years, to support 1,500 Banking on Brighter Futures projects around the world. Employees are being encouraged to volunteer 150,000 hours of their time.
Banking on Brighter Futures is our flagship programme allowing us to use our financial skills and expertise to help people work towards financial independence and security. Aligning our community investment to our core business maximises the impact. We are giving money and using the power and capability of our organisation to tackle social issues, focusing on financial inclusion, entrepreneurship, education and helping people into employment.
Rachael Barber, Global Head of Community Investment, says: “Banking on Brighter Futures covers a huge range of different projects, from major initiatives such as the £3.5m Barclaycard Horizons programme in the UK which has so far benefited 89,000 lone parents and their children, right through to Barclays Capital’s programme with YWCA in New York which involves 24 employees acting as £52.4m mentors and has already helped six women find employment.” Total community investment Global breakdown of community investment in 2007 £000
UK 38,932 Europe 1,994 Africa 7,856 North and South America 3,046 Asia Pacific 579 Total: 52,406 Key performance indicators
2007 2006 2005 Community investment Total community investment £52.4m £46.5m £39.1m Employees receiving support for fundraising, volunteering and giving 43,718 33,419 26,978 Charities supported by Barclays 7,140 8,279 7,515 Fundraising Total amount raised by employees through matched fundraising (a) £12.8m £13.8m £13.8m Total number of fundraising events receiving matched fundraising 9,501 11,399 11,644 Total number of employee fundraisers 8,990 11,772 n/a Volunteering Number of employee volunteers 25,880 19,672 18,608 Number of volunteering grants given 1,815 1,317 1,496 Bank hours to support employee volunteering activities 94,746 75,586 77,413 Employees’ personal hours given to support Barclays volunteering activities 68,935 37,055 Giving Amount given by employees through payroll giving (UK and South Africa) £1.39m £1.08m £1.05m Amount matched (UK and South Africa) (a) £846,000 £578,000 £517,000 Number of people taking part in payroll giving UK and South Africa 12,145 9,549 8,662 Notes (a) Matching from Barclays and Absa
Community investment by region (£) UK 38,932,000 39,589,000 35,259,000 Europe 1,994,000 989,000 882,000 Africa 7,856,000 4,430,000 1,696,000 USA/Canada 3,021,000 1,153,000 1,115,000 Asia Pacific 579,000 316,000 139,000 South America 25,000 16,000 19,000 Barclays in the community case studies
• The Katine project • Horizons - Helping lone parents manage debt • Help the Aged - Providing money management and debt advice • Balia Foundation - Supporting young people in Spain Case study The Katine project
Katine is a region made up of 66 villages in Eastern Uganda, where 77% of the 25,000 population live on less than $1 a day.
The Katine project is a joint initiative by Barclays, the Guardian Media Group, and AMREF (African Financial education, savings, and Medical and Research Foundation). It is a major socio-economic sustainability project providing loan services will be offered in Katine. improved water, sanitation and hygiene practices, improved health and education services, and sustainable economic development in the region.
AMREF is delivering the project on the ground, and The Guardian is following progress in print and online as well as raising around £1.5million from reader donations. Barclays is donating £1.5m to the project and drawing on its business expertise to increase the social benefits.
We are leading a component which includes financial education and the provision of basic savings and loans services to 5,000 people through village banks. Barclays will develop a sustainable model for rural banking that will deliver genuine community and business benefits. The initiative is being driven by Barclays Global Community Investment and Financial Inclusion teams, and Barclays Uganda. This all makes good business sense, enabling Barclays to develop new ways of delivering financial services in remote and rural locations.
At the same time, NGO Farm Africa will improve Katine’s economic development and the livelihoods of local people through better agriculture, use of technology, focus on specific crops and healthcare for £52.4m animals. It will also support farmers to access new markets. While some already sell their goods in Total community investment local markets, not enough is being done to encourage them to sell further afield. Selling in towns and cities, such as Kampala and Mbale, will help local farmers achieve better prices for their produce.
The Katine partners have set themselves ambitious targets to achieve in the coming years including better health, clean water and primary school education.
Sustainable health for Katine’s 25,000 residents requires measures such as establishing village health teams to identify danger signs, such as malaria or malnutrition, and refer people to the nearest clinic. Already, 66 community members have been trained and are ready to deliver these essential services to Katine’s residents.
Clean water is critical for survival and for health, but currently more than 8,000 locals have no choice but to drink dirty water. During the first six months, the project brought clean water to more than 2,500 people and the whole population will be covered by the end of the project.
Primary education, a cornerstone for the future of Katine’s youngsters, will be improved. Teachers will be trained to deliver quality education in more comfortable classrooms. Katine has 13 primary schools but only four have safe water and sanitation, and only half of the children have seats. This contributes to a drop-out rate of over 20% of pupils every year. By building 26 new classrooms and providing clean water and sanitation in schools, the project aims to halve the drop-out rate.
To manage the project’s environmental impact, solar panels are being installed at the office in Katine. More may be installed at local health centres and schools. Ways to help local people protect the environment and increase their livelihoods through carbon credit schemes will also be explored. Case study Horizons – Helping lone parents manage debt
The Barclaycard Horizons programme helps families who are struggling with debt. It targets lone parents as they are among the most vulnerable in our communities. The Barclaycard Horizons Since March 2005, Barclaycard has invested £3.5million in the programme, and through programme helps low-income it supported around 89,000 disadvantaged lone parents and their children. The initiative seeks to parents out of debt and poverty. improve the skills and confidence of lone parents, helping them manage their finances, improve their job prospects and better support their children.
Nearly two million British families have only one parent, and around 1,488,000 children of lone parents are poor.
Horizons brings together four charity partners; Citizens Advice, Family Welfare Association (FWA), One Parent Families|Gingerbread and Parentline Plus. With Barclaycard, they share expertise and knowledge and have created a programme of activity that makes a real difference to lone parents.
Project targets Impacts to date • For FWA to support 3,000 • More than 7,000 lone parents supported through one- lone parents. to-one debt advice and/or financial literacy training. • For Parentline Plus to reach 7,500 • More than 1,000 community professionals received lone parents via parenting financial literacy training and reaching an estimated services. 14,500 lone parents. • For Citizens Advice to reach 7,600 • More than 8,500 lone parents have benefited from lone parents via debt advice and Horizons parenting support. financial literacy training. • Six 'back to work' programmes have been completed • For One Parent Families|Gingerbread supporting 97 lone parents on their journey towards to reach 120 lone parents via the employment. Barclaycard has recruited 11 of them. 'back to work' programme. • 10,460 lone parents and their children have benefited from £600,000 of grants to support education. Case study Jessica Bayliss, from Northampton, is a lone parent who took part in the Barclaycard Horizons programme.
Jessica was paired with a Barclays mentor, who helped develop her skills, identify her career options and increase her self-confidence. Horizons taught her how to achieve financial stability and manage her work/life commitments. Sessions with Parentline Plus were incorporated to help Jessica balance parental stress with work commitments. She also took part in work-based role plays to build her confidence.
As a result of Jessica's achievements during the programme, she now works for Barclaycard as an HR Administrator. The programme has also boosted her confidence. Inspired by Barclays employee £52.4m volunteers, Jessica plans to train as a counsellor so that she can use what she has learned to help others. Total community investment. Case study Help the Aged – Providing money management and debt advice
Barclays has donated £1.8million to the Help the Aged ‘Your Money Matters’ programme. It provides basic money management and debt advice to older people and their carers Barclays has donated £1.8m to the through 17 individual projects across the UK. Help the Aged 'Your Money Matters' The projects help to improve their knowledge, skills and confidence about managing money. They also programme. raise awareness of the issues of older people and debt.
The information and advice provided in sessions range from basic budgeting to understanding how chip and PIN works. They also cover opening bank accounts, negotiating with creditors and helping older people claim benefits.
Barclays employees volunteer their time at the programme’s money management sessions. If individuals require specific financial advice, they can access professional debt advisors through the programme.
Up to 100,000 older people will also receive information and support through targeted publications and SeniorLine, a free welfare benefits advice telephone service.
Project targets • 2,000 older people to receive money management and debt advice through one-to-one sessions with dedicated advisers. • 10,000 older people to attend Your Money Matters group awareness sessions. • Reduce debt among this group by £1.1m. £52.4m • Work with debt advisers and local charity partners to identify £1m of unclaimed benefits. Total community investment
Impacts to date • 2,500 older people have been helped with money management and debt advice through one-to- one sessions with dedicated advisors. • 7,600 have been helped through Your Money Matters group awareness sessions. • Over £1.5m of debt has been written off. • Over £650,000 of additional benefits have been received by older people. • £450,000 of unclaimed benefits have also been identified through SeniorLine.
Mr O’s story Mr O was referred to the Your Money Matters programme by a Macmillan/Citizens Advice Bureau benefits adviser. After his wife’s death in July 2007, he discovered that his wife had built up debts of £3,620 from credit cards and a catalogue account.
Mr O was upset and unsure about what he should do. His wife had not worked for 30 years and had no income or savings. Although he had £13,000 in savings in a joint account with his wife, this was due to a compensation award he had received for an industrial injury.
His adviser drew up pro forma letters for the client to copy out and send to his wife’s creditors with a copy of her death certificate, informing them that she had left no estate. All the creditors responded by writing off the debts. Case study Balia Foundation – Supporting young people in Spain
The Balia Foundation provides support to young people and their families in Spain who are at risk of social exclusion. Over the last three years, in partnership with Barclays, it has been providing safe childcare facilities for children and developing the parents to help them secure more highly skilled work. Balia Foundation, Spain. Many of the families are immigrants with lone parents, who have limited skills and face long working days in order to earn a decent income. This means leaving their children at home, or playing on the street, during working hours.
The Balia Foundation operates an after school club, providing professional childcare and opportunities for children’s personal development.
For parents, the Balia Foundation has two new technology classrooms where they can develop computer skills, design new CVs and search the internet for career opportunities. Barclays colleagues are also running a series of workshops to increase their financial awareness, including budgeting and opening bank accounts.
Project targets Impacts to date • 30 young people to have a safe educational • 45 young people have been enrolled in the environment while their parents are Balia programme enabling their parents to working. look for better jobs. • 30 parents to attend financial awareness • 35 parents have attended financial sessions. awareness sessions. • 30 parents to develop their skills and seek • 9 Barclays volunteers have run financial meaningful and fairly paid employment. awareness sessions. • 12 parents to attend advanced computer workshops.
GC’s story After a long and expensive custody battle with the child’s mother, GC found himself heavily in debt. As a full-time carer, GC had to give up work to look after his child. This left him unable to pay his rent. £52.4m He enrolled his child in the Balia programme, and attended financial awareness sessions, which helped Total community investment him manage and repay his debts. GC is now working hard to find a new, better paid job. A sustainable bank anticipates its customers’ need and builds long-term relationships with its Case studies stakeholders. In 2007, we explicitly set out to develop services with those needs in mind. Sustainability should be ‘business as usual’ — embedded in everything we think and do. It should arise in our first • Developing new products and conversation about a customer’s needs, in the development of new products and in the way we services handle complaints, confidentiality, and security. • Customer service • Broadening our reach Developing new products Customer service Becoming more inclusive and services Customers expect fair • Sustainability relies on treatment, and sustainability is • Responsible lending products and services that suit underpinned by consistently • Investment management our customers’ needs and high standards of service Risk management attract new customers •
Broadening our reach Becoming more inclusive We have more than 30 million Inclusive banking means customers in more than appealing to the broadest 50 countries and we target range of customers and markets with higher growth understanding our customers’ needs
Responsible lending Investment management We tightened our lending Barclays Global Investors is criteria and developed new one of the largest asset services to help customers management companies in manage their borrowing the world
Risk Management Our approach to risk covers environmental and social issues as well as our financial performance Developing new products and services Barclays has a history of innovation. We recognise that sustainability relies on the development of new products and services to suit the needs of our existing customers around the world and to attract new ones. We use our local knowledge to help us adapt successful products in one market to match the needs of customers in another. Last year, we used the inclusive banking expertise we have developed in Africa and the UK to develop our no frills bank account in India. We also launched Barclaycard there, using our expertise as a global cards company. New three-in-one card, Barclaycard Reaching untapped markets OnePulse, brings cheap travel and In Africa, we offer services to townships and remote villages that have never had a bank before. faster payments for Londoners. In February, customers sang and danced in the street at the opening of an express branch in Marromeu, Mozambique by Banco Austral, a subsidiary of Absa, which employs 700 colleagues across 54 outlets. More than 5,000 customers registered for accounts before the branch opened for business. And building on our pioneering 'mobile' branches we have introduced other new formats including small kiosks and ‘the bank in a box’ which is operated from a briefcase and managed by a local agent. These service centres are quick and inexpensive to set up and less intimidating than a visit to a branch for a first-time bank customer.
In September 2007, Barclaycard OnePulse made headlines as the only three-in-one card to combine a 4,082 credit card, a contactless payment card and an Oyster travel card for use on London’s public transport Branches and sales centres. network. Employees helped to test the unique card before it was launched.
Wherever we operate in the world, we aim to be fair and transparent in our dealings with customers, and our performance in this area in the UK is often under a media spotlight. We conduct consumer research 364 days of the year in the UK and use these insights to develop products and services.
We track stakeholder views on our reputation – monitoring how we match up to competitors, and what converts someone from 'just looking' to actually buying.
Investment Philosophy During 2007, Barclays Wealth developed a new software supported Investment Philosophy which looks at six individual characteristics of clients' investment decisions as the basis for targeted portfolio construction. This more developed approach contrasts with the two characteristics commonly used by most financial advisers. Key Performance Indicators
UK Retail Banking 556 644 UK branches refurbished Branches and sales in 2007 centres added in 2007 outside the UK
19% 50,000 increase in year-on-year interviews with UK business savings income growth and retail customers to gain in the UK in 2007 customer insight
UK retail banking • New customers worldwide in 2007 – 21% UK and 79% non-UK. • Savings products reduced from nine to four products, making them simpler for consumers to understand. • Lower than market rate repossession for UK properties in 2007. • Customer recruitment from other banks up 12% on 2006 in Local Business, part of UK Retail Banking. • UK telephony and electronic sales volumes up 27% and 30% respectively in the year.
Growth of our retail presence Distribution points (branches and sales centres)
2007 2006 change Western Europe 798 653 145 Emerging markets 550 214 336 Absa 1,001 838 163
4,082 Branches and sales centres offering customers access to services across our global retail network Developing new products and services case studies
• New trends in credit cards • Shari'a-compliant products for Islamic customers • Customer-focused products and indices from Barclays Capital • Workplace banking in our retail and commercial banking businesses • Business Clubs • Financing renewable energy • Barclays Capital's work on emissions trading Case study New trends in credit cards
One of the trends we are seeing – and leading – in credit cards is the movement towards a wider range of cards tailored for the needs of different customers.
While it's common to have many different cards competing in the market, especially in the UK, there Barclaycard Breathe was launched has been little differentiation between them. We broke new ground with our new cards in 2007. in response to consumer concerns We moved beyond customer satisfaction data and aimed for a much deeper understanding of about global warming. emerging trends, competitor developments, and changes in customers' needs and priorities.
For example, we tailored Barclaycard OnePulse especially for Londoners. It's the first card to combine credit and cashless payments with an Oyster travel card for use on London's public transport network. We were also the first credit card company in the UK to pilot payments of £10 and under by mobile phone.
Barclaycard Breathe is another new card that gives consumers incentives to buy green products and donates half its profits to carbon reduction projects. In 2007, we guaranteed that donations to charity would be at least £1m.
Similarly, Barclaycard Business Sustain is the first business card designed to help companies offset the carbon emissions generated by air travel. 556 UK branches refurbished in 2007 In the USA, we've launched a contactless payments card in partnership with retail chain BJ's Wholesale Club. Consumers pay by waving the new Visa card in front of a card reader. Case study Shari’a-compliant products for Islamic customers
Within Barclays, Barclays Capital is leading the development of wholesale Shari’a- compliant products for Muslim customers. In the UAE and Kenya, our retail bank has also Our Shari’a products help meet the launched Shari’a products. needs of our Muslim customers.
The most prominent requirement of Shari’a prohibits the payment or receipt of a pre-determined return that is not linked to the underlying transaction being financed. For instance, conventional interest payments tend to be non-Shari’a compliant.
Our contribution to making the Islamic market accessible to investors around the world was recognised in the 2007 Islamic Finance News awards, where we won five Deal of the Year awards. 30 million customers globally. In 2007, we launched the UK’s first Shari’a-compliant exchange-traded funds on the London Stock Exchange. Exchange-traded funds are funds that are traded like shares. Customers in Barclays Wealth now have access to a full range of structured Islamic products. This range also includes Barclays Global Investors’ new Shari’a iShares, which cover three different indices: the MSCI World Islamic, Emerging Markets Islamic, and USA Islamic.
We also offer products for Muslim customers in our retail network in the UAE and Kenya. According to ratings agency Moody’s, the global Islamic finance market is estimated to be worth $700bn and has grown by 15% a year since 2005, driven by increasing volumes of sukuk, the Islamic equivalent of bonds.
UAE In the UAE, the number of Islamic banks has grown from two in 2000 to seven in 2007, while the number of Islamic investment companies has grown from one in 2000 to ten in 2007. In terms of assets and liabilities, Islamic banks account for Dh170bn of total banking assets, or 13.5%, a ratio similar to that of Malaysia. Islamic banks currently have the fastest growing market share in the UAE.
We are currently in discussions with a number of providers to distribute Takaful (Shari’a compliant) insurance products and investment options such as mutual funds.
Kenya We launched Islamic banking under the La Riba brand in 2005 in Kenya – the first bank in Kenya and the wider region to launch this offering. The product offers Islamic banking accounts that are Shari’a compliant. We have around 8,000 accounts that have this offering. The product is very popular in new branches especially in areas with a higher concentration of Muslim customers. In these branches the products account for 40% of new accounts.
These products were recognised as the Best Products Innovation at the Market Intelligence Banking Awards in Kenya 2006.
In 2006, a Shariah Advisory Board was appointed to build confidence in the product among customers. Case study Customer-focused products and indices from Barclays Capital
Barclays Capital launched a number of new products during 2007 which were designed to make it easier and more efficient for corporate and trading clients to manage their finances. We are offering new solutions to These included a number of new features on BARX – Barclays Capital’s E-commerce trading platform: help clients meet their needs.
• The Chi-X Exchange, which allows clients to trade European equities up to 10 times faster and up to 10 times cheaper than on traditional equity exchanges • A new dual-currency investment pricer on BARX FX, which is of special interest to private banks, third-party intermediaries and any clients seeking to enhance the yields on their multi-currency portfolios • The ability to trade Barclays Global Investors cash funds in Europe and Asia • A new multi-product trading platform for Barclays Wealth private investors • An online trading system for fixed income, which includes the Research RVI tool, offering interactive access to Barclays Capital’s research/analytics covering over 5,300 bonds and volatility data for the major currencies • The launch of PowerFill Orders – a world first for FX trading. This new tool allows clients to choose whether to execute their trades passively or aggressively 19% • Futures SpreadTrader, a new algorithmic trading tool. Increase on year-on-year savings income growth in the UK in 2007. Case study Workplace banking in our retail and commercial banking businesses
Workplace banking is one of the most effective ways in which we're growing our business in new markets. Absa uses kiosks to deliver The basic idea is to use an established commercial banking relationship with a major company to workplace banking structure a special suite of services for its employees. This provides employees with tailored products and services from a trusted bank, making it more convenient for them to manage their money.
This might include a customised electronic banking portal, and different services tailored for different levels of employee, from standard to Premier accounts.
We're already doing this in markets as diverse as South Africa, Spain, Portugal and Italy, and a number of emerging markets including Kenya. 19% increase in year-on-year savings income growth in the UK in 2007. Case study Business Clubs
In many of the countries in which we operate, our commercial banking operations have developed Business Clubs to help members network and share best practice. The services these clubs offer are tailored to the specific markets in which they operate. In developing countries, such clubs can help businesses learn new ideas and gain access to new markets. Business Club members get to see how businesses have developed in What our customers say: An interview with Dr J N Ng’ethe, a member of the Kenya Business Club. other markets. Dr Ng’ethe founded Metropolitan Chemists Ltd, a high-tech pharmaceutical company in Nairobi, with his wife in 1985. The company manufactures human and animal medicines and has a large research department. It faces many of the same challenges other aspiring businesses face in emerging markets, as well as specific issues relating to the cost of electricity and the presence of illegal chemists in the Kenyan market.
Dr Ng’ethe’s ambition is to build on the success of his manufacturing operation, broadening its range, and making his company a regional and national player. Here he explains how Barclays Business Club in Kenya is helping him. 556 UK branches refurbished How long have you been a member of Kenya Business Club? in 2007 I am a founding member of the club and have been banking with Barclays since 1987.
Do you see a relationship between being a club member and the growth of your business? Yes, definitely! I must say that Barclays as a bank is a very good listener, and sensitive to input from members about improving the club. Barclays has been extremely supportive of the growth of my business. The relationship with the club has been very productive. I am witnessing growth in my business as Barclays grows.
Have you participated in any of the club’s international trips? Through the club I have visited China, Malaysia, Singapore and Thailand.
What benefits did you derive for your business from these trips? This has greatly enhanced my capacity in terms of technological transfer and enabled me to establish useful links for my business. In the mid-90s, I started importing drugs from China for my pharmacy. When I went on the Business Club trip to China, I found out that I can also source the machinery for my manufacturing arm there, and this has helped me save on costs. My scope has broadened, my business has greatly benefited, and I believe I will grow to be a market leader in the manufacturing of pharmaceutical products.
Do you attend the club seminars? Yes, every seminar I have been able to attend has increased my knowledge of better business management. Another direct benefit is that I can network with other club members helping me acquire new customers. Case study Barclays Capital’s work on emissions trading
Barclays Capital is a leading player in the EU emissions trading market. We’ve been able to employ our expertise in commodity trading and risk management to help clients The Emisions Trading Scheme across the world understand and manage their carbon risk. provides a price incentive to reduce CO2. This has included developing forward contracts and derivative products. A good example is our Global Carbon Index, launched in December 2007. This is the first of its kind, and tracks the returns of the credits in a number of carbon trading schemes, including Certified Emissions Reductions and EU Allowances. Our work concentrates in four important areas of the emissions market: 644 Market access and intermediation • Branches and sales centres added in • Risk management and structuring 2007 outside the UK. • Financing and investment, and • Investor products.
Our record so far We are the largest intermediary in the carbon market and were the first to set up a dedicated carbon trading desk.
We’ve traded more then 600 million tonnes of carbon credits, with a total value of around $14billion.
We hold the directorship of the International Emissions Trading Association.
We helped standardise the secondary Certified Emissions Reduction market with the launch of the ‘Standard CER Forward Agreement’.
In the long run, we hope the trading of emissions will make a real contribution to the challenge of climate change, but this will only be fully realised if the successful EU scheme can be extended.
As Louis Redshaw, head of environmental markets at Barclays Capital says: “The only credible solution to delivering the required global emissions reductions is a global cap-and-trade scheme. This would create the potential to set very long-term caps on emissions. And, at a stroke, industry everywhere would face the same price for the ‘common currency’ of emissions.” Case study Barclays Capital's work on emissions trading
Barclays Capital is a leading player in the EU emissions trading market. The Emisions Trading Scheme We’ve been able to employ our expertise in commodity trading and risk management to help clients provides a price incentive to reduce across the world understand and manage their carbon risk. CO2.
This has included developing forward contracts and derivative products. A good example is our Global Carbon Index, launched in December 2007. This is the first of its kind, and tracks the returns of the 644 credits in a number of carbon trading schemes, including Certified Emissions Reductions and EU Allowances. Branches and sales centres added in 2007 outside the UK. Our work concentrates in four important areas of the emissions market:
• Market access and intermediation • Risk management and structuring • Financing and investment, and • Investor products.
Our record so far We are the largest intermediary in the carbon market and were the first to set up a dedicated carbon trading desk.
We are the largest intermediary in the carbon market and were the first to set up a dedicated carbon trading desk.
We’ve traded more then 600 million tonnes of carbon credits, with a total value of around $14billion.
We hold the directorship of the International Emissions Trading Association.
We helped standardise the secondary Certified Emissions Reduction market with the launch of the 'Standard CER Forward Agreement'.
In the long run, we hope the trading of emissions will make a real contribution to the challenge of climate change, but this will only be fully realised if the successful EU scheme can be extended.
As Louis Redshaw, Head of Environmental Markets at Barclays Capital says: "The only credible solution to delivering the required global emissions reductions is a global cap-and-trade scheme. This would create the potential to set very long-term caps on emissions. And, at a stroke, industry everywhere would face the same price for the ‘common currency’ of emissions." Customer service Sustainability must be underpinned by consistently high standards of customer service. We're learning from the best in other service industries. Our Premier offering in Europe established its first flagship outlet in Porto, Portugal – quite a different experience from a traditional branch. Service managers, hired from top-class hotels, run the facilities in these centres which have dedicated desks to speed up basic transactions, meeting areas complete with Wi-Fi access and playzones for children. Outlets like these are aimed at serving the growing number of ‘mass affluent’ consumers – customers who want more personal attention and increasingly sophisticated services. Our new Premier branch in Porto is Customers also expect to be treated fairly and we faced criticism in March 2007 when investigative UK the first of our flagship branches. TV show Whistleblower took a different view. A full enquiry resulted and although no serious failings were found, lessons were learned.
Across our UK banking business, wide-ranging customer service initiatives have brought measurable improvement. Lean, a programme originally developed by Toyota, and used by much-admired service companies such as Amazon, focuses ruthlessly on the customer and cuts out waste. We are using Lean to reduce the number of steps in our processes, and the time they take, improving customer 91% service. An example of its success is the reduction in mortgage processing time from application to Our new security device, PINsentry, offer from 11 days to 5. made online customers feel safer by cutting online fraud losses by 91%. Real Retail In the UK, branch managers play a pivotal role uniting all branch colleagues into one local team including personal bankers and financial specialists such as mortgage and local business advisers. Branch teams use locally tailored market information to serve the needs of their local customers. This is part of a programme called Real Retail. We also launched a programme to phone new UK customers to welcome them to Barclays and check they are happy with our products and service. We called 55,000 customers in 2007, checking that they understood their new accounts and had received all the supporting materials such as cards and PIN numbers. UK Retail Banking’s Chief Executive, Deanna Oppenheimer says: “We start from the principle that every customer deserves the best from Barclays. Real Retail is about creating the sort of culture where all our employees take equal responsibility for delivering the best possible service.” Key Performance Indicators UK retail and commercial banking Successfully transferred 4.6 million accounts, 3.3 million customers and £12billion in balances from Woolwich to Barclays systems. 943 91% Relationship Managers and Our new security device, Relationship Directors in our PINsentry, made online commercial bank in the UK customers feel safer by cutting online fraud losses by 91%
In the UK, Barclays Commercial Bank is a gateway through which customers can access the products and expertise of other businesses in Barclays Group. For example: 40%+ 50% of Barclays Commercial Bank of Barclays Commercial Bank customers also have a customers are also customers Premier Banking relationship of Barclaycard Business Commercial Cards
In 2007, UK Retail Banking entered into: • More than one million new relationships Served: • 9 million customers more than 200 million times in branches • 4.5 million customers more than 40 million times in contact centres • 2.7 million customers more than 130 million times online.
Average branch queuing times in the UK (minutes) 4.5 3.5 3.0
05 06 07
We’re working to reduce these further.
Real Retail – Branch teams use locally tailored market information to serve the needs of their local customers. 86% 96% of branch managers believe said their teams better that the new approach will understand the link between deliver significant customer experience, performance improvements performance and incentives UK Retail Banking customers Key facts 2007 2006 2005 Personal Customers Number of UK current accounts (millions) 11.3* 11.5 11.1 Number of UK savings accounts (millions) 11.1* 11.0 10.8 Total UK mortgage balances £69.8bn £61.7bn £59.6bn Local Business Number of Local Business customers 643,000 630,000 630,000 * Decrease reflects the consolidation of Woolwich and Barclays current accounts.
Barclays Commercial Bank customers Key facts 2007 2006 2005 Number of customers 81,000 77,000** 86,500 Number of colleagues 8,400 8,100 7,800 Note ** Reduction in 2006 relates to customers transferred to Barclays Capital.
Barclays UK Commercial Bank Portfolio
17 1 Business Services, 16 Healthcare and Logistics 14% 14 2 Property and Construction 14% 13 3 Manufacturing 12% 12 4 Public Sector 10% 5 Retail and Wholesale 10% 1 6 Financial Services 8% 10 15 7 Hospitality and Leisure 5% 11 8 Leveraged Corporate 3% 2 9 9 Private Finance Initiatives 3% 10 Media 3% 8 7 11 Leveraged Financial Sponsor 2% 3 12 Agriculture 2% 6 13 Professionals 2% 5 4 14 Technology and Telecoms 2% 15 Private Individuals 1% 16 Miscellaneous 1% 17 Social Housing 9% Total: 100% Customer service case studies
• Services for Polish residents in the UK • Services for Indian people resident in the UK • Security and fraud prevention • Listening to customers at Barclaycard US • A new Investment Philosophy • Using customer feedback to develop products and services • Continuing to serve our customers in Zimbabwe Case study Services for Polish residents in the UK
More than one million Eastern Europeans have moved to Britain over the past three years, many of them from Poland.
Barclays has recruited around a third of this new market as customers, by tailoring our services to their We are tailoring our services for the specific needs. We’ve done this by hiring Polish speakers in areas with large Polish populations such as Polish market. west London, and by holding open evenings for Poles to advise on setting up a business or buying a house. Case study Services for Indian people resident in the UK
In 2007, we launched a range of products specially designed for first and second generation Indian citizens currently living in the UK (known as Non-Resident Indians or NRIs). We launched a new range of NRI customers can access these products in more than 100 Barclays branches across the UK, products and services for Indian increasing access to this type of banking which was previously available only from Indian banks. customers. One of our products is the Non-Resident External Savings Account with which customers can manage all their rupee transactions in India from the UK, using their overseas earnings. The Non-Resident Ordinary Savings Account allows customers to manage their rupee income in India. Both accounts come with ATM cards, free cheque books and free pay orders from India. Customers can move funds from their UK current account to their NRI savings account in India free and within 24 hours.
There are also two rupee term deposit accounts and a Foreign Currency Non-Resident Term Deposit account, for foreign currency savings customers who do not want to convert into rupees. Interest 96% earned on these balances has no tax deducted at source, and is easily moved back to the UK. said their teams better understand the link between customer Deepak Ahuja, Head of NRI Banking UK says: “There are more than one million non-resident Indians in experience, performance and the UK. A lot of them want to provide financial asistance to their family and friends in India, and invest incentives in the growing Indian economy. Thanks to our extensive branch network and international expertise, we can help NRIs meet their own needs in an effective and convenient way.” Case study Security and fraud prevention
Our first priority is the security of our customers' money. Research shows that consumers are concerned about fraud, so we are constantly working to improve the security of our services. PINsentry has helped to reduce Throughout 2007, we helped the UK government and police by continuing to detect and report fraud. online fraud losses by 91%.
Our anti-fraud work operates on a number of fronts, including transaction profiling to help detect and reduce fraud. This prevents many acts of fraud being completed, protecting customers from the inconvenience of sorting out such issues. Our customers are also protected by a fraud guarantee – if they are innocent victims of fraud who have not been negligent they receive a full, and often immediate, refund of any lost money.
In 2007, we launched PINsentry – a new level of security for online banking that uses chip and PIN technology. By the start of 2008, more than one million customers had PINsentry devices. These are small card readers that work with a customer's chip and PIN card to generate a unique passcode for each online banking session. As a result of this and other initiatives, we've cut online fraud losses by 91%, compared with an industry-wide reduction of 33% reported by APACS, the UK payments association. Case study Listening to customers at Barclaycard US
In 2007, members of the Barclaycard US Executive Committee began a new programme – sitting with Customer Care representatives to monitor card member calls.
The call-monitoring sessions are part of a new weekly programme during which leaders monitor and Call-monitoring sessions help evaluate calls, and compare observations, to improve the service offered to our customers. improve customer service.
50% of Barclays Commercial Bank customers are also customers of Barclaycard Business Commercial Cards. Case study A new Investment Philosophy...
Barclays Wealth has recently introduced a new approach that will allow personal clients access to hedge fund strategies previously available only to institutional investors. The new ‘Investment Philosophy’ is a framework for investing, covering a much wider array of products, which can be precisely matched to clients’ needs. Our clients are demanding ever more Barclays Wealth's new Investment diverse and sophisticated approaches to investment, and we have the skills and experience to help Philosophy precisely matches client them make the most of the growing range of opportunities in today’s complex financial markets. need.
The process begins with a Financial Personality Assessment, an exclusive new technique that provides a detailed profile of every client’s individual characteristics, including their attitude to risk. This gives a much richer and subtler analysis of their priorities than traditional profiling.
The data from the assessment is used to construct a personal portfolio, which will typically include a cash element, a core portfolio of assets, and a proportion of more illiquid investments tailored to the client’s specific needs. Private equity, property, and hedge funds can play a role here.
Mark Kibblewhite, Managing Director and Head of UK Private Banking, Barclays Wealth says: “The introduction of this exciting new approach represents our commitment to understand client needs 40% better than anyone in the industry; to deploy the most sophisticated investment techniques and of Barclays Commercial Bank strategies, and to deliver through leading-edge products and technology. We are setting the pace for customers also have a Premier change by introducing scientific ways to help our clients articulate their true expectations and then relationship. meet these with a tailored, innovative framework that delivers appropriate market returns.”
New approaches to reporting Barclays Wealth is introducing a new style of reporting for its personal clients. This is the first step towards a fully-integrated approach that will show clients their total holdings with us, across all types of products from cash to equities.
The new reports combine data from seven different systems and put it on a single page. Each asset class is then broken out and analysed to whatever level of detail the client has requested.
The aim is to continue to improve the reports and add more information based on what clients tell us they want.. Case study Using customer feedback to develop products and services
We use consumer research to help We conduct market research to understand the needs of our customers so we can develop us develop our products and better products and services. services. Since March 2007, in our UK retail bank, we've run monthly customer service panels with our retail customers. At each panel we tested three propositions with them to get customers’ feedback on the products we were hoping to develop.
This research was complemented with 50,000 short interviews with retail and commercial customers and more than 3,000 half-hour interviews to gain even greater insight into consumer views. Our research helped us understand the relationship customers want with their bank and we have used this to develop segmented offers and to prioritise investment activity for the next three years.
Barclays Wealth’s approach A core business belief of Barclays Wealth is that we will only achieve our strategic goals by being demonstrably client-centric. We recognise the need to improve client service and, to that end, have changed the way we do things – including high-level structural changes, modifications to individual business processes, and improving the overall quality of our employees.
We have also:
• Introduced substantially enhanced client reporting, designed around the principles of clarity, simplicity, flexibility and timeliness • Proactively reached out to clients, where a product experience has not lived up to their (or our) expectation.
We use a variety of alternative methods of measuring qualitative outcomes to supplement the internal controls and governance processes in place. Depending upon need, these methods involve either the regular use of external assessment or opinion to validate our internal view, or ad hoc exercises to obtain external views on business proposals. Examples of both are as follows:
All Barclays Wealth businesses are required to conduct half-yearly client surveys Each of our structured products designed for the mass market are scrutinised by an independent external consultancy which scores them on value, transparency and potential returns. If our proposed products do not score highly enough, they are not launched.
We use client focus groups to test significant new marketing proposals Where we develop literature for new product types, we subject it to user groups to comment on whether they believe the literature to be clear and useful – this currently involves colleagues and their relatives.
We recently conducted a survey of 6,000 retail structured-product clients to obtain their feedback on our product range, product literature and service levels and an indication of what motivates their investment decisions. The 800 responses received have provided a rich source of information, which has been used to drive our product development. Case study Continuing to serve our customers in Zimbabwe
Barclays has been in Zimbabwe since 1912 and is committed to supporting our 150,000 customers and 1,000 colleagues in what is clearly a difficult operating environment.
Colleagues at a Barclays branch in Barclays is the majority owner of Barclays Bank of Zimbabwe with a 67.8% stake. Barclays Bank of Kadoma, Zimbabwe. Zimbabwe Limited is a company incorporated under the laws of Zimbabwe with its own governance structure. It has been listed on the Zimbabwe Stock Exchange since the early 1990s.
Barclays Zimbabwe’s participation in the Agricultural Sector Productivity Enhancement Facility has been questioned in the media recently. This is a lending scheme for agricultural customers, and does not involve lending to the government. It is organised by the Reserve Bank of Zimbabwe and all local and foreign banks are required to participate.
Like the other banks in Zimbabwe, Barclays must comply with the regulations of the Zimbabwe Reserve Bank in relation to treasury bills and government bonds, which occasionally involves purchasing these instruments. However, we comply with EU sanctions regarding Zimbabwe. Broadening our reach We have over 30 million customers in more than 50 countries and we are targeting the markets where we believe there will be higher growth. We opened 644 branches and sales centres outside the UK, expanding our distribution in Europe and moving into mass-market services in emerging markets. In Africa we now have products and services that reach across all sectors of society.
The rationale behind this is clear: in Africa alone about 90% of the population is thought to have no access to banking. Being part of that introduction to banking services from the start allows us to build Our retail banking in India offers customer trust and retain those new customers as they migrate to more sophisticated products and innovative products and services services. This has been successful in our South African business, and in 2007 we’ve been applying the such as mobile phone banking and same thinking in other African countries, and in India. our no frills account.
We launched retail banking in India including a suite of current account, credit cards, savings and loans products. We also began to develop mobile phone banking which was launched in 2008. With the country's economy growing at around 9% a year and only one bank branch for every 16,000 people, there is a huge unmet demand for banking services. Mobile phone banking reduces the costs and bureaucracy of opening bricks-and-mortar outlets while making a full range of banking services accessible and affordable for many customers for the first time, especially in rural areas.
China Development Bank Our partnership with China Development Bank (CDB), announced in July 2007, provides unprecedented access to jointly deliver financial services to the rapidly growing Chinese market. CDB can now access 600 our extensive international franchise to help Chinese companies with their international commerce. Kenyan business people took We are sharing best practice on customer service, product development, risk management and part in overseas trade visits corporate governance with our new partner. organised by Barclays Business Club which helped them make Our service to start-up business customers also builds customer loyalty. Providing the funding to kick- new relationships. start a small business is the key to sustainable growth and poverty alleviation in many emerging markets.
From microfinance to Barclays Business Clubs, we make generations of business banking experience available to entrepreneurs and small firms. In Kenya alone, more than 10,000 club members benefit from preferential pricing, educational events, and dedicated Business Development Managers. In 2007, we organised trade visits to potential markets such as China, India, Turkey and Egypt – and many members established profitable trading links as a result. Clubs in Ghana, Zambia, and Botswana were established in 2007.
Distribution points (branches and sales centres) 2007 2006 change Western Europe 798 653 +145 Emerging markets 550 214 +336 Absa 1,001 838 +163 Key Performance Indicators Number of UK branches In Barclaycard UK half of new accounts are driven by the Internet 1,733 2,014 2,029 2007 2006 2005
In the UK the number of branches reduced as a result of the integration of Woolwich.
Emerging markets and Europe 1million+ 550 704 New customers added in Distribution points in GRCB ATMs in GRCB Emerging GRCB Emerging Markets in Emerging Markets, up from Markets, up from 295 in 2007 – more than 100% growth 214 in 2006 2006
In UAE, 15-minute account opening with fully-functional debit card and cheque book. 150,000 798 764 Accounts opened in India in Distribution points in GRCB ATMs, in GRCB Western first six months following Western Europe, up from 653 Europe, up from 665 launch in 2006
GRCB Western Europe added 75,000 new savings clients with balances of £2.3billion following targeted savings campaigns across all four countries. 14% Increase in customer numbers in GRCB Western Europe. Total has now reached one million
Absa • Absa Card ranks number two in South African market by numbers of cards in issue • Absa continued its focus on increasing footprint: 163 new distribution centres, 473 new ATMs • Micro-lending launched as a separate Business Unit in February 2007 • Sales of R1,617m achieved in 2007 equating to 7% share of sector.
Key facts 2007 2006 2005 Number of branches 837 800 759 Number of sales centres 164 38 41 Number of distribution points 1,001 838 800 Number of ATMs 7,884 7,411 5,835 Number of retail customers (millions) 9.7 8.3 7.7 Number of corporate customers 100,000 84,000 79,000 Barclaycard In Barclaycard UK half of new accounts are driven by the internet.
Key facts 2007 2006 2005 Number of Barclaycard UK customers (millions) 10.1 9.8 11.2 Number of retailer relationships 93,000 93,000 93,000 UK credit cards – average outstanding balances £8.4bn £9.4bn £10.1bn UK credit cards – average extended credit balances £6.9bn £8.0bn £8.6bn International average outstanding balance £3.9bn £2.9bn £2.1bn International – average extended credit balances £3.3bn £2.5bn £1.8bn International – cards in issue (millions) 8.8 6.4 4.3 Secured lending – average outstanding balance £4.3bn £3.4bn £2.2bn 80% 10.1million 8.8 million Cards issued in overseas UK Barclaycard customers International cards markets in 2007
Barclays Wealth Key facts 2007 2006 2005 Total client assets £132.5bn £116.1bn £97.5bn Broadening our reach case studies
• The recent crisis in Kenya • New credit cards in Europe Case study The recent crisis in Kenya
Barclays is the largest bank in Kenya, our biggest market on the continent outside South Africa.
Like all the other banks and businesses in the country, our operations were affected by the political We took steps to protect our unrest in late 2007 and early 2008. As an international operation we were able to cope better than colleagues in Kenya. others that only operate within Kenya.
Our primary concern, as always, was the safety of our colleagues and customers, and we acted quickly to understand the situation and take action.
We set up a crisis management committee and made sure all employees were accounted for and offered practical support to those whose homes were damaged or not accessible during the crisis. We then closed some branches temporarily, especially in Kisumu and Eldoret, calling on other Barclays operations in Africa to keep some services going through the crisis.
We contributed £200,000 to the Red Cross Appeal, and many of our employees are working closely with the Kenyan Red Cross teams in the affected areas.
It’s hard to know what the long-term effects of the unrest will be, and whether lending will become tighter as a result. However, we’re in the country for the long term and we’re confident we can manage 550 the situation and continue to operate effectively in Kenya. distribution points in emerging markets. Helping SMEs cope with future disruption Small businesses often operate within tight financial constraints meaning any disruption can hit their profitability and threaten the survival of their business. The recent events in Kenya have obviously been a challenging time for SMEs. As part of our support for the small business community, we have sponsored a countrywide seminar programme together with the International Finance Corporation (IFC), for our Business Club members. The programme of 16 seminars runs between May and June 2008, covering topics such as business crisis management, continuity planning, and business recovery. Our sponsorship of these events is part of our commitment to help the SME sector develop across Africa. Case study New credit cards in Europe
In Germany, we're offering a range of new credit cards in a market dominated by debit cards.
Our four new cards are aimed at different segments of the market. There's also the Netto We developed a range of new cards dual-function card which operates as an EC/Maestro card and also a Mastercard. Traditionally, for the German market German shops tend to accept EC cards only so this is a major breakthrough into a new market. Netto is the discount brand of Germany's biggest grocery chain EDEKA. There are 1,280 Netto shops with 180 new outlets a year planned.
In April, the re:member card was launched in Norway with the slogan 're:member – you're in charge!'. The card is part of the EnterCard range offered through Barclaycard's joint venture with Swedbank. 75% It has been available in Sweden since September 2006. Re:member lets consumers borrow in a flexible of new Barclaycards in 2007 were and controlled way. Customers can choose different insurance packages and additional services. issued outside the UK. Becoming more inclusive Inclusive banking is about appealing to the broadest possible range of customers, understanding the types of customer we have in all our markets, and adapting our business model and products to suit them. Our work on financial inclusion combines commercial and social objectives. Peter Kelly, Head of Financial Inclusion, explains: "This integrated approach provides appropriate and affordable products as well as investment in financial education to help people really benefit from those products."
An individual's journey from financial exclusion to inclusion may have several stages requiring different AllPay - part of Absa - helps support and services from different institutions. We're developing basic banking and microfinance low-income families access products to help customers through this journey, working with intermediary organisations including state benefits. susu collectors supporting market traders in Ghana, and credit unions in the UK.
Using our expertise Governments in emerging markets are promoting financial inclusion and need banks like Barclays, with the expertise they have gained in other markets, to put these plans into action. The Reserve Bank of India requires 32% of lending by foreign banks to go to priority sectors such as microcredit, agriculture and housing.
Absa serves more than five million low-income customers in South Africa, including beneficiaries of social grants through AllPay. Absa also provides Mzansi, Flexi and Club Accounts as basic bank 90,000 accounts for low-income customers. We gave 90,000 UK start-ups reductions in day-to-day banking In 2007, the number of UK customers with our basic Cash Card Account increased by 42% to costs worth up to £25m. 660,000. In response to feedback from consumer organisations, we are training branch colleagues to better meet the needs of basic banking customers.
A Banking Code Standards Board's mystery shopping survey found our performance on the basic bank account was "generally better than the average". A subsequent visit in 2008 showed that our performance had improved. Key performance indicators
Our lending decisions are based upon customers' ability to repay, not where they live. These tables show the extent of our business in deprived areas. Support for small UK businesses in deprived areas (a) As at 31 December 2007 The figures below refer to firms with a debit turnover of less than £1million.
% share All small Small business business customers in customers deprived areas 2007 2006 2005 Number of business current accounts 705,599 16,999 2.4 2.4 2.3 % in overdraft 21.9 26.8 2.9 2.9 2.7 Number of business deposit accounts 283,579 6,454 2.3 2.6 2.4 Number of outstanding loans (b) 89,187 2,420 2.7 2.7 2.6 Number of new loans in 2007 (c) 17,917 475 2.7 2.9 2.6 Loan and overdraft balances £9,467m £204m 2.2 2.2 2.1 Current and deposit balances £11,250m £259m 2.3 2.4 2.5 Ratio of savings to lending 1.19 1.27 Business start-ups in 2007 90,671 2,856 3.1 3.1 2.9 % of end-year business customers 12.5 15.8
Notes (a) 'Small businesses' are those meeting the definition used by the British Bankers Association. ‘Deprived areas’ are the 5% most deprived postcodes in each of England, Scotland and Wales based on the most recent indices of deprivation for each country. (b) Including commercial mortgages. (c) Excluding commercial mortgages.
In 2007, we gave: 9,696 2,287 Small business loans of less than Small businesses loans of less than £20,000, excluding commercial £5,000, excluding commercial mortgages mortgages
Support for personal customers in deprived areas
2007 Analysis 2006 Barclays Barclays UK Deprived UK Deprived accounts areas (d) % accounts areas % Number of current accounts 11,303,136 247,366 2.2% 11,467,960 252,496 2.2% Number of Cash Card Accounts 660,661 36,217 5.5% 464,508 28,890 6.2% Cash Card Accounts as % of all current accounts 5.8% 14.6% 4.1% 11.4%
Notes (d) ‘Deprived areas’ are the 5% most deprived postcodes in each of England, Scotland and Wales based on the most recent indices of deprivation for each country. £14.8m £5.5m of support to independent money of support to independent money advice services since 2004 advice services in 2007 Becoming more inclusive case studies
• Microfinance in emerging markets • Basic banking in South Africa and India • Black Economic Empowerment • Economic growth and good governance in Africa • Our work on HIV/AIDS in Africa • Financial inclusion partnerships in the UK • Lending and support to start-ups and individuals in deprived areas of the UK • Support for female and ethnic minority entrepreneurs in the UK • Our work with social housing firms and charities in the UK and South Africa Case study Microfinance in emerging markets
What is microfinance? Microfinance is providing financial services to people who cannot access formal banking services. These services often include very small loans, typically less than $100, savings and insurance Susu collectors operate in markets products. The basic principle of microfinance was endorsed by the G8 leaders in June 2004 as: in Ghana. (Picture by Candace Feit) "building financial systems that serve the poor".
In many cases, being able to manage their savings, however small, and to borrow to establish a business can help lift people and their families out of poverty. The size of the market 36,217 Although it's difficult to get accurate statistics, some estimates suggest that there are more than Cash Card Accounts in a million small businesses in emerging markets. The number of micro-enterprises is thought to be deprived areas. even larger. This is a huge potential market for us, which is why we’re developing a wide range of microfinance services for these entrepreneurs.
The first phase of our microfinance plans cover Ghana, Kenya, India and Zambia, and we’re looking to expand in Botswana, Uganda and Egypt. In 2007, we appointed a new head of microbanking and expanded our team in Ghana. We also appointed new heads of microfinance in India, Kenya and Zambia.
South Africa As many as 97% of micro-entrepreneurs in South Africa have no access to loans – a huge market opportunity of up to R2.85billion (£180million).
Absa has been a pioneer of basic banking in South Africa, with more than 4.5 million people on low incomes using its savings accounts, transaction accounts and loans.
In 2007, we extended our commitment in this market by launching Absa's first dedicated micro- enterprise unit for micro-enterprises. It has a range of products tailored for micro-businesses at different stages of their development including Absa savings and transaction products.
Yanda loans are aimed at new clients with no previous track record. Loans start at R300 (£19) and go up to R8,000 (£500). If credit is managed well and repaid on time, the client can access larger-scale financing. We may implement this more widely in Africa.
Group Lending loans focus on rural areas and use a Grameen Bank approach, providing loans to groups of women who support each other with repayment.
Retail Enterprise Loans are aimed at larger enterprises, and are more like conventional loans. They range from R2,500 to R25,000 (£155 to £1,550).
Gerhard Coetzee, General Manager, Micro-Enterprise Finance, in Absa says: "We are entering a market with huge potential for reducing poverty levels in South Africa by bringing funding to micro- entrepreneurs operating in disadvantaged communities around the country. Previously ignored by the system, these entrepreneurs need loans as small as R400 to establish themselves and even create opportunities for others."
Since the start of the Khula Credit Indemnity Scheme 10 years ago, Absa has provided R420m in funding to more than 2,700 business enterprises who would otherwise have been unable to start or expand their businesses due to lack of capital or collateral. Ghana Our collaboration with the traditional ‘susu’ collectors in Ghana is now in its third year. As much as 80% of the 21 million people in Ghana are engaged in the informal sector. Many people have no access to formal banking services, instead they use the country’s traditional forms of community banking.
There are more than 4,000 susu collectors who collect a fixed amount of money from their clients daily, keep it safe for them, and then return it at the end of each month, minus one day’s contribution. Collectors usually have between 400 and 2,000 clients. The susu industry is estimated to be worth around £75m.
Barclays continues to provide deposit accounts to the collectors, and loans they can in turn lend to their clients. The number of collectors on our programme has increased from 100 in two regions in the first year to more than 500 across the country in 2007. Around 70% of the susu collectors have attended Barclays training sessions.
An independent study of the programme's impact showed that 72% of susu collectors increased the number of clients they have since joining our programme, which has an 81% satisfaction rate. On the client side, 61% said their lives had improved and 93% of those in business recorded an increase in sales and income.
The programme is now being expanded to other intermediaries such as credit unions and trade associations. Our aim is to help more than a million people access appropriate financial services. Case study Basic banking in South Africa and India
Across Africa, we offer a range of different basic banking accounts, tailored for different customers and markets.
South Africa Our first year of retail banking in Absa pioneered basic banking in Africa, and now has 33% of the South African market. We are now India was one of significant growth. using its expertise to bring the concept to other countries across the continent.
Absa's principal basic accounts are Mzansi and Sekulula. These accounts are targeted at people earning less than R3,000 (£187) a month and with very limited or uncertain income. This currently accounts for 23.6 million consumers, or 76% of the overall retail bank market. 36,217 Mzansi is an industry-wide initiative, launched in 2004. It's a very basic transaction account that offers Cash Card Accounts in easy access, with a low minimum opening deposit of R10 (£0.62p) and no requirement for a deprived areas permanent postal address. For consumers on very low incomes this is important as they may be forced out of housing at short notice when they are not earning. The number of accounts grew by 8% from 529,436 to 569,900 in 2007.
Sekulula is unique to Absa and is a debit card that allows people on social welfare to access funds at any ATM. Cardholders can also deposit money into their Sekulula account. The number of accounts grew by 12.2% from 612,707 in December 2006 to 683,576 in December 2007.
AllPay is also unique to Absa, and is specially designed for those on welfare. It was set up in 1997, and currently distributes social grants to Western Cape, Free State, Gauteng and Eastern Cape. Account holders can access their money in cash from a designated service point or using a Sekulula debit card to make purchases or withdraw cash from an ATM.
AllPay beneficiaries have access to a helpline and advice on both financial services and HIV/AIDS. The success of the account is due in part to the respect for the customer that is the basic principle of AllPay, and which can be summed up in the Nguni word 'ubuntu'. It's a word which translates as "I am because you are," meaning that we all need other people to be fulfilled.
Other basic accounts include the Flexi Account, which grew by 9% from 3,601,671 accounts to 3,941,022 in 2007, and the Club Account, which grew by 27% from 18,445 accounts to 23,394.
In 2007, Absa spent R18.8million (£1.2million) on consumer education to improve financial literacy. This was done through financial seminars, face-to-face training in communities, and print communications.
India Barclays recently launched a new 'no frills' account in India. More than 2,000 had been opened by the end of 2007.
The account offers all the benefits of basic banking and requires an average quarterly balance of no more than 350 rupees (£4). Any balances over this amount are automatically swept into a savings account at the end of each month. Case study Black Economic Empowerment
Black Economic Empowerment (BEE) is a key part of the South African government’s plan to transform the country and ensure that everyone has an opportunity to share in the wealth it is creating. Absa is making good progress to In October 2003, Absa was a signatory to the Financial Sector Charter (FSC). This deals with issues meet its BEE targets. such as employment, equity ownership, and how banks work with their supply chains. Specific targets are set in a wide variety of areas. Each financial institution is given a rating each year, from A-E, providing an indication of the extent to which the firm is setting a more inclusive agenda through its practices.
We made significant progress on these issues in 2007. For instance, the proportion of black people in senior positions increased at junior, middle and senior management levels, as well as on the Absa 36,217 board. The number of black suppliers in Absa’s supply chain increased, and a number of new products Cash Card Accounts in and services were launched that specifically address BEE objectives. deprived areas In the wider economy, Absa continued to provide finance for low-income housing, agriculture, and small and medium enterprises.
Absa’s FSC performance in December 2006 and December 2007 was assessed by an external auditor. Absa scored 86.2 points and was an A-rated company in 2006.
Our FSC scorecard for 2007 was 92.53 meaning we have maintained our A rating. Absa is also on course to meet its FSC targets for 2008. Case study Economic growth and good governance in Africa
Our £2.6billion investment in Absa, South Africa's largest bank, in 2005 was our largest purchase in Africa. However, we also have a presence in 10 other African countries, with Kenya is one of 10 African countries around 2.3 million accounts and more than 14,000 employees. in which we operate.
We’re committed to long-term sustainable development in Africa and believe this will only be achieved through the benefits of business investment in which the people of Africa share. Africa’s huge potential can only be unlocked if business is able to develop profitably on the continent, and economic participation grows. To do this, business will have to work in partnership with government and NGOs. Our guiding principles 36,217 Our priorities in Africa are: Cash Card Accounts in • To develop local capabilities and local management deprived areas • To develop sustainable African businesses using our commercial banking expertise, together with capital funding for infrastructure projects • To provide accessible, affordable and understandable retail banking products and services to those who need and want them.
Our presence in Africa is about business, not philanthropy. However, we believe that developing successful, commercially viable banks in Africa will also contribute to sustainable development.
Nurturing a new economy We’re also working to develop the broader African economy. We see the development of an effective small business sector as key to Africa’s long-term success. We’re helping to develop these businesses and increasing our focus on non-traditional lending and microfinance.
Our involvement also extends into African capital markets, where the financing we arrange helps develop Africa’s infrastructure. This will help the continent become a more attractive business environment.
We are also committed to ethical development. We actively contribute to the development of better governance and stronger civil institutions through our work on industry groups and self-regulatory initiatives.
A leadership role By observing the highest standards of governance wherever we operate in the world, we provide a model for others to follow – driving up local standards. A number of our board members in Africa and other emerging markets use the experience they gain working with Barclays to help the other businesses they are involved with. In this way, we are helping to spread best practice.
Barclays was the only financial institution to support the Commonwealth Business Forum in Kampala, Uganda, in 2007. Our Group Vice Chairman Gary Hoffman spoke to delegates, including Commonwealth Heads of Government, on how global business can help to strengthen local economies.
In South Africa, Absa’s work on financial inclusion, basic banking and social housing all make a substantial contribution to sustainable growth. We also support the Accelerated and Shared Growth Initiative for South Africa, which aims to halve poverty and unemployment by 2014. Absa believes that helping ordinary South Africans accumulate 'personal capital' (savings, investments, property) is the best and most sustainable way to achieve this. Developing Africa’s economy for Africans Our development in Africa relies on the ability and talents of our African employees. We have African leadership teams and boards for our African businesses – people who know and can work collaboratively and ethically with local and national African governments. We also insist that succession plans for our business are based on developing local expertise through effective training. Case study Our work on HIV/AIDS in Africa
In Africa, HIV/AIDS is the biggest single threat to our own employees, the future of the economy, and the development of a thriving business sector. We run programmes to help employees find out their HIV status. In South Africa alone:
• 5.3 million adults and children are living with HIV • 2.9 million women aged 15-49 are living with HIV • 230,000 children under 15 years are living with HIV.
We're tackling this on three fronts – with our own colleagues, with our customers, and in the wider community.
Our colleagues We offer voluntary testing for HIV and counselling to all employees. This is free and confidential, as is our employee helpline. Our 'Live Well, Work Well' programme is one of the most successful employee HIV/AIDS programmes in Africa.
Our customers Turning to our customers, we know that small and medium-sized businesses are bearing the brunt of the epidemic. Technical know-how, experience, and management skills are hard to replace even for 36,217 big concerns in Africa, but for a smaller firm the loss of one key employee can be catastrophic for the Cash Card Accounts in whole business. This is where we've been able to help. For example, we’ve worked with the Afrikaanse deprived areas Handels Instituut on a "know your status" campaign and tool kit for small businesses. This makes it easier and more affordable for employers to help their employees manage their HIV status.
Our communities The third element of our HIV/AIDS programme happens out in the community. HIV/AIDS is the overwhelming priority of our community programme across Africa, with nearly 1% of our profits going straight to HIV/AIDS programmes.
This includes education and counselling, donations of medical equipment, support for AIDS orphans, and funding for projects. Case study Financial inclusion partnerships in the UK
Financial inclusion is still an important issue in the UK with an estimated three million people without bank accounts and up to eight million using high-cost lenders. We provide funding for face-to-face Our financial inclusion programme in the UK is long established. We work to improve the supply of basic money advice provided by Citizens products and services and to empower people to understand and use financial services confidently. Advice.
Financial exclusion is a complex issue which cannot be solved by one organisation alone. So in 2007, we continued to develop our partnerships with other organisations including community finance and advice agencies, housing associations and charities.
Working in partnership As the leading corporate funder of credit unions and CDFIs (Community Development Finance Institutions) we believe these local organisations provide a simple first step into formal financial 36,217 services. Cash Card Accounts in deprived areas Our partnership with the CDFA (Community Development Finance Association) on the Step Change programme has developed, taking this programme into a second year with a further £120,000 in support. This is providing capacity building and grant support for specific areas of need identified by the sector, including loan delinquency, board governance and social reporting.
In 2007, our Vice Chairman Gary Hoffman accepted a role on the Third Sector Credit Working Group, a sub-group of the government's Financial Inclusion Taskforce, leading to greater engagement with government on issues relating to better access to affordable credit. We also continued our support for credit unions and ABCUL (Association of British Credit Unions Ltd), supporting their strategy work.
“When the UK government engaged banks to support the scaling up of the credit union sector Barclays was quick to respond with support for a series of high profile roadshows to develop a strategy for scaling up,” said Mark Lyonette, Chief Executive of ABCUL and a member of the UK Financial Inclusion Taskforce.
He added: “Combined with its ongoing support for the PEARLS financial monitoring system, Barclays continues to stand out among the largest banks as a committed supporter of strengthening credit unions.”
Kitty Ussher, the UK government’s Economic Secretary to the Treasury, said: “Barclays continues to display real leadership in promoting financial inclusion, particularly in viewing it as a competitive, as well as a social, concern.”
In 2008, this work will continue when Gary Hoffman joins the Financial Inclusion Taskforce.
Engaging with others We've worked with a number of partners such as The Passage, Help the Aged, and other groups to make the opening of bank accounts easier for excluded people such as the homeless, and ex- offenders. In 2008, we will work with The Passage on a research programme to help it develop its own financial inclusion work.
We have been involved at a national and regional level in the UK government’s ‘Now Let’s Talk Money Campaign’, raising awareness of our commitment to financial inclusion and the development work on our basic banking product, the Cash Card Account. Housing associations continue to be important partners in tackling exclusion and in 2007 we ran a successful workshop for a number of them. This was designed to share best practice and expertise on financial inclusion. By December 2007, we had arranged ‘introducer schemes’ for seven housing associations. These help tenants open basic bank accounts with us. Around 70 new accounts were opened by the end of the year as a result.
We're also working on a programme with Leonard Cheshire Disability to help people with disabilities set up their own businesses. Over three years we are investing £2.6million, and many of our employees will be volunteering as mentors. Case study Lending and support to start-ups and individuals in deprived areas of the UK
Despite the credit crunch, in the last three months of 2007 we agreed an average of 91 new loans per working day to small firms with a turnover of less than £1million. Tracy Mackness, centre, won our This added up to £500m of new money for the sector. Trading Places award. We also have just under 17,000 business current accounts in deprived areas, and our small business loans and overdrafts in these areas totalled £204m at the end of 2007.
For some years we've run local seminars aimed at new entrepreneurs, focusing on those in deprived areas of the UK. In 2007, we ran 870 'Let's Talk Start Up in Business' events attracting more than 8,000 delegates. Around 63% of these events were held in deprived neighbourhoods.
We also provide a programme of 'Let's Talk' events for existing businesses, ensuring that they have access to support and advice on a range of business-related matters. In 2007, we ran 39 events across the country, attracting 3,674 businesses. Around 28% of these events were run in deprived areas.
We also ran the Barclays Trading Places Awards for the second year. The awards are aimed at individuals who have overcome major adversity by setting up in business. They are supported by the government and run with major partners including The Sun and The Prince's Trust. Last year, Tracey Mackness won the top prize for her efforts to develop a successful sausage business following a period of mental illness and imprisonment.
Other facilities for small business include the Small Firms Loan Guarantee scheme, which is a joint venture between the Department for Business, Enterprise and Regulatory Reform and a number of 36,217 major lenders, including Barclays. It aims to help small enterprises that may not be able to obtain Cash Card Accounts in loans because they lack assets to offer as security or a track record. The government effectively deprived areas acts as guarantor for up to 75% of the loan. Case study Support for female and ethnic minority entrepreneurs in the UK
All our business relationship managers are expected to understand the make-up and characteristics of their local communities, and be active within them. Diwali celebrations at our Southall Branches in specific areas are provided with an information pack that gives detailed demographic branch with local MP Virendra information about the local area. We also run targeted events aimed at entrepeneurs from the South Sharma (right). East Asian community.
We’ve given our salespeople special training about business practices in South East Asia, and key cultural differences and characteristics. Much of this training was held at local Asian community sites 36,217 such as Sikh temples and mosques. The feedback scores we’ve received as a result are among our Cash Card Accounts in highest ever. deprived areas In November 2007, we sponsored the Hindu Forum of Britain Diwali event at the House of Commons in London, and a 'How to take your business to the next level seminar' at Wembley, London.
We also monitor our lending to starts-ups by women, and have stepped up our work to encourage women in business in the last year. We've recently agreed to work with Professor Sue Marlow of De Montfort University and Professor Sara Carter (a member of the new Women's Enterprise Task Force) on a joint project on women, banking and business. They are expected to report later in 2008. Case study Our work with social housing firms and charities in the UK and South Africa
In the UK in 2007, we lent £1.6bn to finance social housing, which brought our total lending to the sector to £7.3bn. Absa’s goal is to deliver financing for We have a 14.2% share of this sector, and 400 housing associations bank with us. 100,000 homes by 2010. We are also one of the main financiers of housing associations, lending them more than £6bn.
During 2007, we arranged finance of more than £1.5bn for associations to fund low-cost home ownership, and a wide range of other projects including key worker housing, student accommodation and privately rented homes.
Working with AmicusHorizon In 2007, we committed to supporting a 'Bank Accounts for Tenants' programme for AmicusHorizon – an umbrella group for a number of social housing landlords. The initiative was designed to provide 36,217 practical local support and financial education for up to 3,000 tenants and young people facing Cash Card Accounts in financial exclusion. deprived areas The programme, jointly funded by AmicusHorizon and Barclays, will operate initially for two years. One of the aims of the project is to train tenants to become community finance champions. They will provide specialist advice, training and support to new residents, and ensure they have access to basic bank accounts and the skills they need to use them.
We work with AmicusHorizon on a number of other community initiatives. These include a new outdoor sports facility at Murston in Kent, and the development of a community sports club through Barclays £30m community sponsorship programme, Spaces for Sports.
Delivering better value for the charitable sector We strive to provide the best banking and fund management services for our charitable clients to help them better achieve their charitable objectives. According to CaritasData, in 2007 more large UK charities banked with us than any other bank. We were bankers for 28 of the top 100 UK registered charities ranked by total annual income and 5 of the top 10 fundraisers. In 2006, the Charity Fund Management Survey said we managed more charitable funds than any other UK financial institution. In September, Barclays Wealth was managing £2.3bn on behalf of 1,700 UK charities.
As well as providing banking and investment management services for charities, we also provide them with practical advice. We work with various stakeholders and organisations from the sector, and have a programme of charity events planned to help charities improve their management. In October 2007, we held a fraud awareness seminar at our headquarters in London with speakers from Barclays Fraud Team and the Charity Commission. Our clients wanted to learn from our best practice in this area. Other events are planned including guest speakers from Barclays Wealth, the Institute of Philanthropy, Philanthropy UK, and other professional advisers to charities such as solicitors and accountants. Absa's work on social housing in South Africa Absa lent a total of R940million to finance social housing in 2007. This covers loans to more than 8,200 people in low-income groups.
Absa also has a subsidiary dedicated to sustainable social housing projects, the Absa Development Company. This business funds developments that combine affordable homes with commercial and light industrial units and social amenities such as schools, crèches, churches and parks.
The Absa Development Company supports the South African government's 'Breaking New Ground' policy. This aims to use the provision of decent housing to help create jobs, stimulate economic growth, combat crime, and eliminate social division.
Absa's goal is to deliver financing for at least 100,000 homes by 2010. The emphasis in 2008 will be as follows:
• 9,400 units in Kagiso, Mogale City Local Municipality, Gauteng • 8,200 units in Klarinet, Mpumalanga • 5,000 units in Ndlambe, Eastern Cape, and • 7,200 units in Chief Albert Luthuli Park, Ekurhuleni. Barclays also sponsored the Innovation Ghana conference in 2007, bringing together business, government and academics to find a solution to the country’s housing shortage. Responsible lending The level of unsecured consumer debt remains a high-profile issue in a number of countries, but attention turned from consumer lending in the UK to mortgages in the USA as the credit crunch hit in late 2007. Barclays Capital subsidiary HomEq Servicing became a founder member of the HOPE NOW Alliance formed in the USA in October to help struggling homeowners meet rising mortgage payments.
In the UK, our policy on mortgage arrears is to contact customers early to ensure that arrangements to help them are put in place quickly. Our Loan Star loan offers a competitive interest rate. Following criticism of Shared Appreciation Mortgages (SAMs), products we sold in 1998, we introduced a hardship scheme for customers voluntarily. The scheme offers SAMs holders who are suffering hardship, interest-free loans to move into a more appropriate property. Those who do not wish to move can apply for a one-off, non-repayable grant to adapt their current home. So far, 80% of applications for assistance have been approved based on the criteria for the scheme.
Strict lending criteria Although the market for commercial loans became tighter in 2007, UK Business Banking relaunched as Barclays Commercial Bank in November and remained very much 'open for business' for our corporate customers.
Barclaycard in the UK enforced strict criteria on new card applications, using a scoring system that takes more than 400 variables into account when assessing applicants' ability to manage debt. Around 50% of applications are declined as a result.
During 2007, we continued to work on the behavioural data-sharing collaboration we helped initiate with APACS, the UK payments association. Sharing this additional data will give lenders a greater pool £3.5m of information on which to base lending decisions and identify customers in danger of future debt is being spent on the Barclaycard problems. Horizons programme helping low- income parents out of debt and poverty. Key performance indicators UK credit cards £8.4bn £9.4bn Average outstanding Average outstanding balances in 2007 balances in 2006 £6.9bn £8.0bn Average extended credit Average extended credit balances in 2007 balances in 2006
International credit cards 8.8 million 6.4 million International cards International cards in in issue in 2007 issue in 2006 £3.9bn £2.9bn Average outstanding Average outstanding balances in 2007 balances in 2006 £3.3bn £2.5bn Average extended credit Average extended credit balances in 2007 balances in 2006. As our international cards business has grown so has our total lending on cards
Barclaycard secured lending £4.3bn £3.4bn Average outstanding Average outstanding loans in 2007 loans in 2006
Retail impairment charges on loans and advances fell 11% (£204m) to £1,605m (2006: £1,809m).
Barclaycard impairment charges improved 21% (£229m) to £838m (2006: £1,067m) reflecting reduced flows into delinquency, lower levels of arrears and lower charge-offs in UK cards.
Impairment charges in UK Retail Banking decreased by £76m (12%) to £559m (2006: £635m). Our specialist UK business support team helps businesses in financial difficulties get back on track: Businesses supported Success rate 2007 568 82% 2006 400 80%
Mortgages
Barclays mortgage customers in GRCB Western Europe 134,087 Italy* France 98,658 Portugal Spain 19,527 13,276
*Through Banca Woolwich.
Mortgage loan-to-value ratio UK (%)
Loan to value 46 44
43 ratio on the mortgage book 35 34
33 Industry average*
05 06 07
*Industry figures from the Council of Mortgage Lenders, 2008. Responsible lending case studies
• Launch of Fair & Square • Our new Financial Support Team • The mortgage market in the UK and Western Europe • Supporting our customers Case study Launch of Fair & Square
Fair & Square is a new proposition in the UK secured lending market. It offers a straightforward product, simply explained, with a competitive interest rate and no hidden charges. Fair & Square offers to lower the Fair & Square is aimed at consumers who want to manage their borrowing more effectively. More than cost of unsecured debt. 750,000 people in the UK could reduce the rate they are currently paying on unsecured debts and Fair & Square was established to help them do that.
Challenging preconceptions Fair & Square is challenging the preconceptions about secured lending among consumers and the media. It aims to make this sort of loan a normal and affordable way to manage debt. As unsecured debt becomes tighter and more expensive, it offers real consumer choice, a 30-day 'cooling-off' period, and one of the lowest early redemption charges on the market.
Neil Radley, Managing Director of Barclaycard Secured Lending says: "Secured loans are often viewed as lending of last resort – it’s a view that’s outdated and we aim to change it. For people with other £3.5m debts at high interest rates, secured loans should at least be on the consideration list. A secured loan is being spent on the Barclaycard managed well is far better than unsecured borrowing managed poorly." Horizons programme helping low- income parents out of debt and Fair & Square sits alongside, FIRSTPLUS, which serves a different segment of the market. poverty. Case study Our new Financial Support Team
During 2007, Barclaycard subsidiary FIRSTPLUS introduced a Financial Support Team to help customers facing problems with their debts.
The team deals with accounts before they fall into arrears and customers in financial difficulty can call FIRSTPLUS launched initiatives to the team for help before they miss a payment. help customers in financial difficulty.
The team provides support to customers and advises them on prioritising their debts. Examples of support offered are Term Extensions (extending the term of the customer's loan to reduce the monthly contractual payment on the account), Payment Holidays and Repayment Plans.
The Financial Support Team also calls customers identified by Credit Risk as having a higher chance of falling into arrears (through analysis of the customer's account and other financial circumstances). These calls help educate customers about managing their finances and keeping repayments under control. In 2007, we reduced our maximum loan-to-value (LTV) ratio at FIRSTPLUS from 125% to 100%. £3.5m In July, we introduced our new Arrears Management Policy to help customers in arrears improve their is being spent on the Barclaycard situation and reduce the need for further action. As a result, we have introduced practices such as Horizons programme helping low- more flexible payments and extending the term of loans to reduce arrears. income parents out of debt and poverty. Case study The mortgage market in the UK and Western Europe
We are the seventh largest mortgage lender in the UK, and offer both residential and buy- to-let mortgages under the Woolwich Mortgages brand name. A Barclays branch in Portugal.
In 2007, our mortgage business continued to grow through our focus on delivering long-term value to our customers.
Our approach means that we don’t operate in the sub-prime market. Generally our loans are to consumers who’ve had no payment arrears in the last year, no more than three months’ arrears in the last three years, and no defaults or County Court Judgments during the same period. During 2007, Woolwich mortgages were available for up to 95% of the value of the property for residential loans, and 85% for buy-to-let. However, the majority of our loans were for lower loan-to-value percentages, and most of our customers are experienced borrowers. In 2007, our proportion of arrears and repossessions was lower than the market average. When customers fall behind with their payments, we work with them to find a fair way to resolve the situation. Repossession is always a last resort.
Long-term value Our range of mortgages is available to both new and existing customers, and is designed to offer long- term value with lifetime trackers, long-term fixed rates and offset mortgages. Consumers can choose £3.5m the product that best suits them. Some of our mortgage deals have application fees. Products that is being spent on the Barclaycard start with a short-term fixed rate generally revert to a tracker rate after the initial period. We always try Horizons programme helping low- to keep our customers when their loans come to an end, and contact them to explore what products income parents out of debt and they might want. poverty. Plans to repay We assess whether mortgage applicants can afford their loans by going through a process of credit scoring. This takes into account net monthly income and other regular credit commitments and outgoings. We also look at the implications of any possible rises in interest rates. We do not offer loans on a self-certification basis. We only offer interest-only mortgages if applicants can demonstrate that they have plans in place to repay the capital at the end of the mortgage term. Low-risk loans with a low loan-to-value percentage are offered a simplified, fast-track approval process.
Rigorous Our businesses in GRCB Western Europe continue to increase their rigorous credit assessments for mortgage applications, seeing this as the best way to cut the number of accounts that go into arrears.
European markets have slightly different approaches to mortgages than in the UK. For example, in Spain, Portugal and France, more than 90% of our mortgages have variable rates, so these customers are not facing the same issues as fixed-rate customers in the UK.
In 2007, our business in Portugal significantly improved mortgage processing times by re-locating all back-office colleagues to one site. We also instituted an account manager system which means each new customer is given a single point of contact in Barclays. Case study Supporting our customers
In 2007, we offered special support to our business customers in rural areas of the UK whose businesses were affected by foot and mouth disease. We also offered help to businesses which suffered in severe floods. We helped our business customers in flood-affected areas. We offered a financial support package to all our customers in flood-affected areas, including repayment holidays on existing and new loans, and extensions to overdraft facilities.
Chris Grigg, Chief Executive, Barclays Commercial Bank, says: “Many businesses in flooded areas were severely affected. We wanted to help wherever possible and as quickly as possible to prevent any cash flow issues and keep our customers in business.”
Foot and mouth When foot and mouth broke out again in 2007, the UK-wide ban on moving livestock meant sales were delayed and animals couldn't be sent to market. We knew many of our agricultural customers £3.5m would face cash flow difficulties as a result, and put together a support package to help them. is being spent on the Barclaycard Horizons programme helping low- This included repayment breaks on existing loans for an initial six-month period, the offer of new loans, income parents out of debt and and extended overdraft facilities for essential animal feed supplies. poverty. Martin Redfearn, Barclays National Agricultural Specialist says: “2007 was a difficult and stressful year for the farming industry with the floods and the added issue of foot and mouth. Barclays is absolutely committed to supporting its customers and these measures helped them through this difficult time.” Investment management Barclays Global Investors (BGI) is one of the largest asset managers in the world with more than $2trillion under management. Much of this money is invested in tracker funds including $60billion of environmental and ethical investments. BGI is the world's largest manager of exchange-traded funds (investment vehicles that can be traded like equities) under the iShares brand name. iShares allow individual and institutional investors the flexibility to invest across a broad range of indices, including some focusing on environmental, social and governance criteria, such as the iShares KLD Select Social Index Fund, iShares XEN Jantzi Social Index Fund and the Dow Jones EURO STOXX Sustainability 40. The take-up of green products is iShares allow investors the flexibility growing slowly but we think it is important to develop and offer them to our clients. BGI evaluates to invest across a broad range of environmental, social and governance criteria just as we examine other potential sources of long-term indices. value for companies.
Corporate Governance We promote strong corporate governance in companies in our investment portfolios as a key mechanism for protecting shareholder value for our clients. Our votes at company AGMs reflect this approach, as does our engagement with those companies and within the wider shareholder community.
We regularly engage with companies on issues that could have a significant impact on the value of our clients' holdings. We do this at face-to-face meetings with senior management and board members or through written communication. We support initiatives within the shareholder community to promote long-term value for clients.
BGI is active in a range of corporate governance organisations including the International Corporate Governance Network, the Council of Institutional Investors, the Stanford University Institutional 324 Investors Forum, the Australian Investment and Financial Services Association, and the National We increased the number of iShares Association of Pension Funds in the UK. funds we offer globally from 191 to 324. Key performance indicators
Barclays Global Investors 2007 2006 2005 Net new assets in period: £42bn £37bn £48bn Assets under management (US$): 2,079bn 1,814bn 1,513bn indexed 1,225bn 1,108bn 980bn iShares 408bn 287bn 193bn active 446bn 419bn 340bn Net new assets in period (US$) 86bn 68bn 88bn Number of iShares products 324 191 149 Number of institutional clients 3,000 2,900 2,800 Case study iShares using alternative investment criteria
In 2007, we launched a number of different iShare products that use indices with alternative investment criteria. By offering these kinds of funds, we provide our clients with options to balance their social objectives with their investment objectives. iShares products help customers For example, in 2007 we acquired the iShares Dow Jones EURO STOXX Sustainability 40 from spread their risk. Indexchange. It enables investors to profit from the largest sustainably operating companies in the Eurozone, where the index components are weighted in line with the "degree of sustainability". The Dow Jones EURO STOXX Sustainability 40 Index offers a consistent, flexible and investable blue-chip representation of the largest sustainability leaders in the Eurozone, in terms of long-term economic, environmental and social criteria.
Using exchange-traded funds as building blocks, customers can spread the risk of individual companies, entire sectors or even whole countries to minimise the possibility of suffering losses. Our iShares team is constantly developing new products to meet the needs of our customers.
Index disclaimers ‘iShares’ is a registered trademark of Barclays Global Investors, N.A. £42bn All other trademarks, servicemarks or registered trademarks are the property of their respective owners. (c) 2008 Barclays Global Net new assets in 2007 Investors Limited. Registered Company No. 00796793. All rights reserved. financial year Risk management Our approach to risk management across the Group helped us maintain our performance during one of the toughest years for banks in recent times. In the UK, our conservative approach to lending helped us achieve an average loan to value (LTV) on new mortgage business in 2007 of 54%. Across the existing UK mortgage book the LTV for 2007 was 33%. In Barclaycard, stricter lending criteria helped profit grow.
Our Brand and Reputation Committee, a sub-committee of the Group Executive Committee, met six times during the year and discussed issues ranging from Barclays presence in Zimbabwe to new areas Our Environmental Risk team of commodities business and Barclaycard’s fee structure. Sir Nigel Rudd, Barclays Deputy Chairman screens project finance deals, and a Non-Executive Director on the Board, chairs the committee. Its role is to identify and manage including those in the oil industry. issues that could have a significant impact on Barclays reputation.
We’re proud to have co-founded the Equator Principles which have changed the operation of the project finance market since 2003, and in 2007 we’ve continued to lead on their development. As the Chair Bank for 2007/08, we are playing a central role in promoting the Principles at international events. Our own guidelines for assessing social and environmental risk go beyond the Principles, extending into other larger non-project credit facilities.
Training During 2007, 65 employees in Hong Kong, Jakarta, Singapore, Lisbon, London, Paris and New York were trained to identify different environmental risks in 10 sectors, including agriculture, mining, and 54 oil and gas, and to follow our policies and procedures for managing them. Our internal environmental project finance deals were risk guidelines were also reviewed and updated. considered by our Environmental Risk team, up from 36 in 2006. New deals are assessed by our credit teams, the lending manager, and the Environmental Risk team. If any social and environmental risks are identified, we work with the client to determine whether those risks can be managed or mitigated, and what changes or covenants need to be incorporated into the loan documents.
This process worked for the $870million Bujagali hydropower project in Uganda. This deal, partly financed by the World Bank and a consortium of private sector institutions including Absa, recently won Project Finance magazine’s ‘African Power Deal of the Year’ award. Key performance indicators Project Finance deals – Barclays Group
Category Total Total Total ABC2007 2006 2005 Higher Medium Lower Risk Risk Risk Number of project finance deals 7 18 29 54 36 68 Deals completed or pending 4 12 29 45 30 43 – of which, number where environmental and social related changes were made 4 12 29 45 30 N/A Deals considered, but not participated in 3 6 0 9 625 Projects referred from EU 5 9 24 38 25 58 Projects referred from Africa 2 1 4 7 58 Projects referred from Asia Pacific 0 4 1 5 32 Projects referred from North America 0 4 0 4 30
Environmental risk-management training
2007 2006 Number of employees trained 65 122
Project Finance deals by sector
Sector 2007 2006 General manufacturing 3 0 Infrastructure (including dams) 9 3 Mining and metals 6 3 Oil and gas 4 3 Power generation 16 14 – of which fossil fuels 7 8 – of which non fossil fuels 9 6 Service industry 10 11 Utilities and waste management 5 1 Chemicals, pharmaceuticals manufacturing and bulk storage 1 1 Total 54 36
Our guidance notes cover the following sectors, and a number of sub-sectors within them: • Agriculture and fisheries • Metals and mining • Oil and gas • Power generation, supply and distribution • Chemicals, pharmaceuticals manufacturing and bulk storage • General manufacturing • Utilities and waste management • Infrastructure • Service industry • Forestry and logging. Risk management case studies
• Our pioneering research with the London Accord • Managing environmental risk in the commercial bank in the UK Case study Our pioneering research with the London Accord
There's been a great deal of debate about what businesses can do to reduce carbon emissions, but less on what they need to do to adapt to the climate changes we already Barclays worked closely with the face. London Accord. During 2007, Chris Bray, Barclays Head of Environmental Risk Policy Management, worked closely with the climate adaptation consultants Acclimatise as part of a wider initiative by the London Accord, a coalition of banks, researchers, academics and NGOs.
The overall report produced by the London Accord looked at the investment consequences of a rising carbon price. Barclays contribution was new research on how a changing climate could affect the way banks assess credit risk.
This research looks not just at climate risks but opportunities, and how different sectors will be affected by changing weather patterns, heightened threats to physical assets and infrastructure, changing consumer demand, and a growing scarcity of natural resources, whether locally or regionally.
Chris says: "We deliberately concentrated on a wide range of sectors, not just those obviously affected by climate change, such as energy, but those where the impacts are more complex, such as tourism. 9 There are many ways we could move this thinking forward in 2008; my own view is that we'll have to project finance deals rejected ensure a balance, addressing the potential commercial impacts of a changing climate, while gaining because of our screening process. a better understanding of the timescales involved." Case study Managing environmental risk in the commercial bank in the UK
All loans by our commercial bank are considered against our environmental risk criteria. All Barclays Commercial Bank advances are assessed for environmental risk by our Relationship and In the UK, our commercial bank Credit Risk Teams who are supported by an Environmental Risk Associate Credit Director. assesses environmental risks when making advances. In 2006, we improved our processes by developing a bespoke environmental screening product, Barclays SiteGuard, to assess any environmental risks on commercial land and property offered as security for a loan. This online system is used by our panel of valuers partly to look at a site's commercial history and its potential for contamination, in addition to the implications of its current or intended commercial use. In 2007, approximately 3,700 such sites were screened via Barclays SiteGuard. Of these, 950 cases were flagged as requiring further action and referred directly to the Environmental Risk Associate Credit Director for review. Recommendations were made to mitigate risk, or enhance opportunity, as appropriate. 54 Our knowledge of environmental risk is leading to commercial opportunities and, in 2007, we launched an environmental insurance product for businesses, based on our Barclays SiteGuard report. project finance deals were considered by our environmental risk team, up from 36 in 2006. Targets and performance Summary of commitments and progress
Sustainable bank: 2007 Commitment Update on 2007 Commitment Expand branch and cash machine network in South Africa. By the end of 2007, Absa had a total of 7,884 cash machines and 1,001 distribution points. Significant growth in branch and cash machine network Our GRCB Emerging Markets business, which operates in Africa, the across our African businesses. Middle East and India increased the total number of ATMs to 704, up from 295 in 2006. It also increased the number of distribution points to 550, up from 214 in 2006. Absa added 163 new distribution centres, and 473 new ATMs. Increase take-up of Mzansi basic bank account in South Absa increased its Mzansi accounts to 570,000. Africa. Grow basic banking services targeting disadvantaged Absa was able to achieve this success through its continued focus on people. core channels such as expansion of its footprint with new points of presence, particularly in previously disadvantaged areas, leveraging its brand sponsorships such as the Absa Cup and the Premiership League (PSL) that are relevant to the mass market. Continue progress towards the achievement of Black The proportion of black people in senior positions increased at junior, Economic Empowerment targets in South Africa. middle and senior management levels, as well as on the Absa board. The number of black suppliers in Absa’s supply chain increased, and a number of new products and services were launched that specifically address Black Economic Empowerment objectives. Target Cash Card customer satisfaction score of 89%. Cash Card satisfaction survey achieved 86%. Reach 500,000 people through microbanking in Ghana. Reached 280,000 market traders through susu collectors alone. Established strategies to reach more people through other intermediaries such as trade associations and credit unions. Play a leading role in driving sustainability in the credit union We provided significant input in 2007 into UK government work in sector to reduce financial exclusion. this area. Continue environmental and social risk training programme. 65 employees in Hong Kong, Jakarta, Singapore, Lisbon, London, Paris, and New York were trained in the identification of risks in 10 sensitive sectors, and our policies and procedures for managing them. Complete the Barclays/Woolwich branch and infrastructure Transferred 4.6 million accounts, 3.3 million customers and £12 billion in integration programme. balances from Woolwich to Barclays systems. Maintain momentum on customer service and satisfaction. Launched various initiatives such as Lean and Real Retail focused on efficient, quality-driven customer service. Drive progress on data-sharing initiatives in responsible In Barclaycard we continued to work on the behavioural data-sharing lending. Continue data review to ensure we make the best collaboration we helped initiate with APACS, the UK payments credit decisions for our customers. association. Develop electronic information to help customers make Barclaycard US continued to implement its ‘credit on the web’ for new informed decisions. credit card customers and offered eight different programmes to assist card holders facing difficulties in making payments. Develop further environmental products for personal Launched products such as Barclaycard Breathe and Barclaycard customers. Business Sustain. Responsible global citizen: 2007 Commitment Update on 2007 Commitment Increase participation in employee community programmes Almost 44,000 employees participated in 2007, an increase of 31%. by 5%. Drive globalisation of community programme, increasing £13.5 million was invested in community programmes outside the UK in non-UK funding to 25% of total. 2007, 26% of the total. 30% of community investment to be focused on Banking on 29% of funds invested in Banking on Brighter Futures. Brighter Futures theme. Improve employee opinion scores to high-performing norm. Steady progress with one area improving to exceed HPO, one area increasing to match HPO and one area remaining at HPO. Improve satisfaction scores for disabled, gay and lesbian The gap between satisfaction scores for disabled, gay and lesbian colleagues and improve disability access to products and colleagues and other groups persisted in 2007. delivery channels. Increase the proportion of women in senior grades. The number of senior women executives increased from 12.2% in 2006 to 13.7% in 2007. Continue programmes towards 2010 targets – CO2, energy, We have put in place several initiatives to improve our resource efficiency water, waste. Establish new programmes to eliminate and waste management, such as rain water harvesting at Barclaycard sources of waste. and ‘reverse vending’ machines at Barclays Capital in London. Work towards becoming globally carbon neutral. Source We continued to focus on increasing our energy efficiency and renewable renewable energy for international operations. energy purchases, as well as offsetting the remaining UK emissions. During 2007, we moved to a renewable contract which increased the proportion of our total electricity supplied by renewable sources to almost 50% in the UK. Continue application of questionnaire to medium and high- We held a special forum for eight major suppliers and identified ways to risk new and existing suppliers. help them reduce their emissions including setting up a working group. Absa adapted the questionnaire to suit suppliers in its market. Launch employee guide on climate change actions. Worked with publisher Rough Guides to produce the Rough Guide to Saving Energy and Reducing Your Carbon Footprint. Continue to extend the EMS internationally. 83% of our global operations are covered by an EMS, with environmental data being received from over 92%. New ISO 14001 certification of EMS was established in South Africa. Collaborate with United Nations Environment Programme to We worked with UNEP FI and a team of 11 other financial institutions to develop our approach to human rights in risk management. develop an online resource for bankers on the human rights issues associated with lending. Additionally, we have represented our sector on the Business Leaders Initiative on Human Rights. Targets and performance In 2008, we will: • Act on customer and client feedback to develop appropriate products and services to meet different needs. We will also improve employee training and development to ensure that our people have the know how to understand the needs of our customers and clients, and how best to serve them. • Explore appropriate ways to help customers who face financial difficulties resolve their problems. • Continue to find solutions to expand our inclusive banking services in new and existing markets. • Continue to develop products, like Barclaycard’s Breathe, that support environmental sustainability and develop investment products to help clients balance their social and environmental objectives with investment objectives. • Extend our programme of employee training in environmental credit risk management, including the application of the Equator Principles, and continue to develop our understanding of the impacts of changing climatic conditions on our lending decisions. • Work with governments and regulators in the UK, EU and US to help them develop a market-driven approach to carbon emission reduction. • Work on proposals to help strengthen financial stability and develop effective regulatory frameworks through our continued engagement with governments and other bodies. • Continue the globalisation of our Community Investment programme, increasing non-UK funding to 40% of the total. In addition, we will encourage employees to volunteer a total of 20,000 hours, and assign 45% of community investment to our Banking on Brighter Futures programme. • Become carbon neutral globally in 2009 and develop low-carbon property design standards for use in new Barclays buildings. • Share best practice with firms in our supply chain and expand the use of our supplier questionnaire to promote more sustainable environmental and social impacts. • Develop diversity strategies and action plans tailored to local markets across our businesses globally. GRI tables Barclays is committed to the transparency, consistency and accuracy of our reporting. Therefore, we continue to follow the Global Reporting Initiative (GRI) Reporting Framework. This year, we have updated our GRI Index Tables from the 2002 reporting guidelines to the G3 Indicator protocols, along with the Financial Sector Supplements.
We have provided links to the Sustainability Review 2007, Barclays website, and Annual Report as sources of disclosures for each of the Performance Indicators. There are certain areas that are not reported because they are not applicable to our businesses, or the data is not collected and available in this format.
Key: AR = Annual Report 2007 (relevant page number) NR = Not Reported
Strategy and Analysis Section Disclosure Links 1.1 Statement from the CEO CEO introduction 1.2 Description of key impacts, risks and opportunities Sustainability and Barclays
Profi le Section Disclosure Links 2.1 Name of reporting organisation Home page 2.2 Primary brands products and/or services Products and services 2.3 Operating structure of the organisation Business strategy 2.4 Location of organisation's headquarters Home page 2.5 Number of countries where the organisation operates Where we operate 2.6 Nature of ownership and legal form AR (page 284) 2.7 Markets served Our Customers 2.8 Scale of reporting organisation Highlights 2.9 Signifi cant changes during the reporting period regarding size, AR (pages 56, 130, 212) structure or ownership 2.10 Awards received in the reporting period Awards Reporting Parameters Section Disclosure Links 3.1 Reporting period for information provided Sustainability and Barclays 3.2 Date of most recent report Home page 3.3 Reporting cycle CEO introduction 3.4 Contact point Contacts 3.5 Process for defi ning report content Home page Sustainability and Barclays Stakeholder engagement 3.6 Boundary of the report Sustainability and Barclays 3.7 State any specifi c limitations on the scope of the report Sustainability and Barclays 3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, Sustainability and Barclays outsourced operations, and other entities 3.9 Data measurement techniques and the basis of calculations Sustainability and Barclays 3.10 Explanation of the effect of any re-statements of information provided Sustainability and Barclays in earlier reports 3.11 Signifi cant changes in the scope, boundary or measurement methods Sustainability and Barclays 3.12 GRI Context Index Table GRI Tables 3.13 Independent assurance for the report External assurance Governance, commitments and engagement Section Disclosure Links 4.1 Governance structure of the organisation Our governance framework 4.2 Indication if the Chair of the highest governance body is also an Our governance framework executive offi cer 4.3 Independent and/or non-executive directors Our governance framework 4.4 Mechanisms for shareholders and employees to provide Our governance framework recommendations or direction to the highest governance body An inclusive employer KPIs 4.5 Linkage between compensation for members of the highest Our governance framework governance body, senior managers and executives and the organisation's performance 4.6 Processes of the highest governance body to ensure confl icts of interest Our governance framework are avoided 4.7 Process for determining the qualifi cations and expertise of the Our governance framework members of the highest governance body 4.8 Internally developed mission and values statements, codes of conduct, CEO introduction and principles Sustainability and Barclays Policy positions Sustainable bank Responsible global citizen 4.9 Procedures of the highest governance body for overseeing the Our governance framework organisation's identifi cation and management of economic, environmental and social performance 4.10 Processes for evaluating the performance of the highest governance Our governance framework body 4.11 Precautionary approach or principle Risk management 4.12 Externally developed charters, sets of principles, or other initiatives to Stakeholder engagement which the organisation subscribes or which it endorses Our governance framework Equator Principles 4.13 Signifi cant memberships in associations and/or national/international Our governance framework advocacy organisations Stakeholder engagement 4.14 List of stakeholder groups engaged by organisations Stakeholder engagement 4.15 Basis for identifi cation and selection of stakeholders to engage Stakeholder engagement 4.16 Approaches to stakeholder engagement, including frequency of Stakeholder engagement engagement 4.17 Key topics and concerns that have been raised through stakeholder Stakeholder engagement engagement and how the organisation has responded to those key issues Economic Section Disclosure Links Disclosure on Disclosure on management approach Our governance framework Management Approach Goals and Organisation-wide goals regarding performance Targets and performance Performance Policy Organisation-wide policies Policy positions EC1 Direct economic value generated and distributed Economic impact In the community EC2 Financial implications and other risks and opportunities for the The environmental organisation's activities due to climate change services offered by Barclays Commercial Bank Financing renewable energy New trends in credit cards Barclays Capital’s work on emissions trading Our pioneering research with the London Accord EC3 Coverage of organisation's defi ned benefi t plan obligations AR (pages 206, 212) EC4 Signifi cant fi nancial assistance received from government NR EC5 Range of ratios of standard entry level wage compared to the local Our new deal on cleaners' minimum wage at signifi cant locations of operation pay EC6 Policy, practices and proportion of spending on locally based suppliers Absa's new supply chain at signifi cant locations of operation questionnaire Our policy on child, forced and compulsory labour Black Economic Empowerment EC7 Procedures for local hiring, and proportion of senior management in An inclusive employer locations of signifi cant operation from local community An inclusive employer – KPIs EC8 Development and impact of infrastructure investments and services In the community provided primarily for public benefi t through commercial, in-kind, or In the community – KPIs pro-bono engagement In the community – Case Studies EC9 Understanding and describing signifi cant indirect economic impacts, Economic impact including the extent of impacts Sustainability and Barclays Broadening our reach Broadening our reach – KPIs Becoming more inclusive Becoming more inclusive – case studies Environmental Section Disclosure Links Disclosure on Disclosure on the management approach The environment Management Approach Goals & Organisation-wide goals set regarding performance Measuring our impact Performance Targets and Performance 2008 commitments The environment – KPIs Policy Organisation-wide policies The environment Absa’s environmental strategy and programme Environment – Our Policies Organisational The most senior position with operational responsibility Our governance framework Responsibility Training and Procedures related to training and raising awareness Risk management – KPIs awareness Monitoring and Procedures related to monitoring and corrective actions Supply chain follow up Supply chain – KPIs Absa’s new supplier questionnaire EN1 Materials used by weight or volume NR EN2 Percentage of materials used that are recycled input materials NR EN3 Direct energy consumption by primary energy source NR EN4 Indirect energy consumption by primary source The environment – KPIs EN5 Energy saved due to conservation and effi ciency improvements The environment EN6 Initiatives to provide energy-effi cient or renewable energy based The environment products and services, and reduction in energy requirements as a result The environment – case of these initiatives studies EN7 Initiatives to reduce indirect energy consumption and reductions The environment – KPIs achieved (additional) The environment – case studies EN8 Total water withdrawn by source (core) NR EN9 Water sources signifi cantly affected by withdrawal of water (additional) NR EN10 Percentage and total volume of water recycled and reused (additional) NR EN11 Location and size of land owned, leased or managed in, or adjacent to, NR protected areas and areas of high biodiversity value outside protected areas (core) EN12 Description of signifi cant impact of activities, products and services NR on biodiversity in protected areas and areas of high biodiversity value outside protected areas (core) EN13 Habitats protected or restored (additional) Absa’s environmental strategy and programme EN14 Strategies, current actions, and future plans for managing impacts on Absa’s environmental diversity strategy and programme Environment – Our Policies Risk management EN15 Number of IUCN Red List species and national conservation list species NR with habitats in areas affected by operations EN16 Total direct and indirect greenhouse gas emissions by weight (core) NR EN17 Other relevant indirect greenhouse gas emissions by weight (core) NR EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved The environment (additional) The environment – KPIs The environment – case studies EN19 Emissions of ozone depleting substances by weight (core) The environment – KPIs EN20 NO, SO and other signifi cant air emissions by type and weight (core) NR EN21 Total water discharge by quality and destination (core) NR EN22 Total amount of waste by type and disposal method (core) The environment – KPIs EN23 Total number and volume of signifi cant spills (core) NR EN24 Weight of waste deemed hazardous under the terms of the Basel NR Convention Annex I, II, III or VIII, and percentage of transported waste shipped internationally (additional) EN25 Identity, size and protected status and biodiversity value of water bodies NR affected by reporting organisation's discharges of water and runoff (additional) EN26 Initiatives to mitigate environmental impacts of products and services Our progress towards carbon and extent of impact mitigation neutrality The environment The environment – KPIs The environment – case studies EN27 Percentage of products sold and their packaging materials that are NR reclaimed by category (core) EN28 Monetary value of signifi cant fi nes and total number of non-monetary NR sanctions for, non-compliance with environmental laws and regulations (core) EN29 Signifi cant environmental impacts of transporting goods and materials NR used for organisation's operations, and transporting members of the workforce (additional) EN30 Total environmental expenditures and investments by type (additional) Financing renewable energy Progress towards carbon neutrality Our approach to offsetting Labour practices and decent work Section Disclosure Links Disclosure on Disclosure on management approach Policy positions management Responsible global citizen approach An inclusive employer Goals and Organisation wide goals regarding performance Targets and performance performance 2008 commitments An inclusive employer Policy Organisation-wide policies An inclusive employer Our policy on child, forced and compulsory labour Organisational The most senior position with operational responsibility Our governance framework Responsibility Training and Procedures related to training and raising awareness An inclusive employer Awareness Monitoring and Procedures related to monitoring and corrective actions NR follow up LA1 Total workforce by employment type, employment contract and region An inclusive employer – KPIs LA2 Total number and rate of employee turnover broken down by age, An inclusive employer – KPIs gender and region LA3 Benefi ts provided to full time employees that are not provided to An inclusive employer – KPIs temporary or part time employees, by major operations LA4 Percentage of employees covered by collective bargaining agreements NR LA5 Minimum notice period(s) regarding operational changes Policy positions LA7 Rates of injury, occupational diseases, lost days and absenteeism and An inclusive employer – KPIs number of work related fatalities by region (core) LA8 Education, training, counselling, prevention and risk-control Our work on HIV/AIDS in programmes in place to assist workforce members, their families or Africa community members regarding serious diseases (core) Live Well, Work Well in Africa An inclusive employer – case studies LA10 Average hours of training per year per employee by employee category NR (core) LA11 Programmes for skills management and lifelong learning that support Policy positions the continued employability of employees and assist them in managing career endings LA12 Percentage of employees receiving regular performance and career NR development review LA13 Composition of governance bodies and breakdown of employees per An inclusive employer – KPIs category according to gender, age group, minority group membership and other indicators of diversity (core) LA14 Ratio of average remuneration of men and women broken down by An inclusive employer – KPIs employee category (core) Human rights Section Disclosure Links Disclosure on Disclosure on management approach Our governance framework management approach Goals and Organisation wide goals regarding performance Targets and performance performance 2008 commitments Policy Organisation-wide policies Human rights – Case studies Human rights Organisational The most senior position with operational responsibility Our governance framework Responsibility Training and Procedures related to training and raising awareness Human rights Awareness Risk management Equator Principles Business Leaders Initiative on Human Rights HR1 Percentage and total number of signifi cant investment agreements that Risk management – KPIs have undergone human rights screening HR2 Percentage of signifi cant suppliers and contractors that have NR undergone screening on human rights and action taken HR4 Total number of incidents of discrimination and actions taken NR HR5 Operations identifi ed in which the right to exercise of freedom of NR association and collective bargaining may be at signifi cant risk, and actions taken to support these rights HR6 Operations identifi ed as having signifi cant risk for incidents of child Our policy on child, forced labour and measures taken to contribute to the elimination of child and compulsory labour labour HR7 Operations identifi ed as having signifi cant risk of forced or compulsory Our policy on child, forced labour, and measures to contribute to the elimination of forced or and compulsory labour compulsory labour Society Section Disclosure Links Disclosure on Disclosure on management approach Policy positions management approach Goals and Organisation-wide goals regarding performance Targets and performance performance 2008 commitments Policy Organisation-wide policies Policy positions Organisational The most senior position with operational responsibility Our governance framework Responsibility Training and Procedures related to the training and raising awareness Policy positions awareness Monitoring and Procedures related to monitoring and corrective and preventive actions Our governance framework follow up SO1 Nature, scope and effectiveness of any programmes and practices that Broadening our reach assess and manage the impacts of operations on communities Broadening our reach – case studies Becoming more inclusive Becoming more inclusive – case studies SO2 Percentage and total number of Business Units analysed for risks Policy positions related to corruption SO3 Percentage of employees trained in organisation's anti-corruption NR policies and procedures SO4 Actions taken in response to incidents of corruption NR SO5 Public policy positions and participation in public policy development Stakeholder engagement and lobbying SO6 Total value of fi nancial and in-kind contributions to political parties, AR (page 131) politicians and related institutions by country SO7 Total number of legal actions for anti-competitive behaviour, anti-trust AR (page 218) and monopoly practices and their outcomes SO8 Monetary value of signifi cant fi nes and total number of non-monetary AR (page 218) sanctions for non-compliance with laws and regulations Product responsibility Section Disclosure Links Disclosure on Disclosure on management approach Our governance framework Management Developing new products Approach and services Customer service Policy Organisation-wide policies Customer service Organisational The most senior position with operational responsibility Our governance framework responsibility Training and Procedures relating to training and awareness NR awareness Monitoring and Procedures relating to monitoring and corrective and preventive actions NR follow up PR1 Life cycle stages in which the health and safety impacts of products NR and services are assessed for improvement PR2 Total number of incidents of non-compliance with regulations and NR voluntary codes concerning health and safety impacts of products and services during their lifecycle, by types of outcome PR3 Type of product and service information required by procedures, NR and percentage of signifi cant products and services subject to such information requirements PR4 Total number of incidents of non-compliance with regulations and NR voluntary codes concerning product and services information and labelling, by type of outcomes PR5 Practices related to customer satisfaction, including results of survey Customer service measuring customer satisfaction Listening to customers at Barclaycard US Using customer feedback to drive development of products and services Stakeholder engagement PR6 Programmes for adherence to laws, standards and voluntary codes NR related to marketing communications including advertising, promotion and sponsorship (core) PR7 Total number and type of incidents of non-compliance with regulations NR and voluntary codes, concerning marketing communications including advertising, promotion and sponsorship (additional) PR8 Total number of substantiated complaints regarding breaches of NR customer privacy and losses of customer data PR9 Monetary value of signifi cant fi nes for non-compliance with laws and NR regulations concerning the provision and use of products and services (core) Financial Services Sector Supplement – Social Performance Indicators (SPIs) Section Disclosure Links CSR1 CSR Policy Home page Sustainability and Barclays CEO introduction CSR2 CSR Organisation Our governance framework Policy positions CSR3 CSR Audits External assurance CSR4 Sensitive Issues Policy positions CSR5 Non-compliance NR CSR6 Stakeholder dialogue Stakeholder engagement INT1 Internal CSR policy Policy positions INT2 employee turnover and job creation An inclusive employer – KPIs INT3 Employee satisfaction An inclusive employer – KPIs INT4 Senior management remuneration AR (page 144) INT5 Bonuses fostering sustainable success Our governance framework INT6 Female/male salary ratio NR INT7 Employee profi le An inclusive employer – KPIs SOC1 Charitable contributions In the community – KPIs SOC2 Economic value added Economic impact SUP1 Supplier screening Supply chain SUP2 Supplier satisfaction NR RB1 Retail banking policy Sustainable banking RB2 Lending profi le Responsible lending RB3 High social benefi t lending Broadening our reach Becoming more inclusive IB1 Investment policy Risk management IB2 Customer profi le Risk management Our customers Becoming more inclusive – KPIs IB3 Transactions with high social benefi ts Broadening our reach Our approach to offsetting AM1 Asset management policy Investment management AM2 Fostering social capital Investment management Investment management – case study AM3 SRI oriented shareholder activity Investment management INS1 Underwriting policy Risk management INS2 Customer profi le NR INS3 Customer complaints NR INS4 High social benefi t insurance NR Financial Services Sector Supplement – Environmental Performance Indicators (EPIs) Section Disclosure Links F1 Environmental policies applied to core business lines Environment – Our policies F2 Screening of environmental risks Risk management Managing environmental risk in the commercial bank in the UK F3 Threshold(s) for environmental risk assessment procedures Risk management F4 Monitoring environmental aspects raised in risk assessment NR process(es). F5 Improving employee competency in addressing environmental risks and Our governance framework opportunities Risk management Stakeholder engagement The environment Engaging stakeholders 2008 commitments F6 Audits of environmental risk systems and procedures Our governance framework External assurance F7 Interaction with stakeholders about risks and opportunities Stakeholder engagement Our pioneering research with the London Accord Barclays Capital’s work on emissions trading F8 Engagement on environmental issues with companies in portfolio Investment management F9 Assets subject to environmental screening Investment management F10 Share voting policy on environmental issues Investment management F11 AUM with right to vote shares or advise on voting NR F12 Value of environmental products and services Financing renewable energy Barclays Capital’s work on emissions trading Investment management Our progress towards carbon neutrality Absa’s environmental strategy and programme F13 Value of portfolio by specifi c region and sector NR External assurance Barclays online Sustainability Review 2007 External assurance and commentary Barclays has commissioned Corporate Citizenship to provide it with external assurance and commentary on its online Sustainability Review 2007. Barclays management has prepared the Review and is responsible for its contents. Our objectives were to review its contents and presentation, to conduct selected checks to underlying records and other evidence, and to provide this statement for which we have sole responsibility.
Corporate Citizenship is a specialist management consultancy, advising corporations that seek to improve their economic, social and environmental performance around the world. A detailed note describing our relationship with Barclays and the assurance process we have adopted appears at the end of this statement.
Our opinion In our opinion, the online Sustainability Review provides a fair and balanced representation of the material aspects of Barclays performance for the 2007 reporting period. We have examined the processes Barclays has in place for identifying, understanding, managing and responding to its corporate sustainability issues. Where we believe significant gaps in performance data and stakeholder views on material issues exist, they are identified below.
In forming our opinion and making our comments, we have based our work on the international assurance standard AA1000, notably considering materiality, completeness and responsiveness. We have also had regard to the reporting guidance for content and the principles for defining quality contained in GRI's G3 sustainability reporting guidelines.
Commentary A corporate sustainability report should explain how a company impacts on society, looking at all the important economic, social and environmental concerns of its stakeholders. It should show how crucial decisions are made, differing interests are balanced and progress is being made towards the goal of sustainable development. Honest about shortcomings, it should demonstrate how the organisation is responsive, by listening, learning and improving.
Barclays eighth such report marks a shift in the company’s approach to its social responsibilities, with a new strategy of focussing on Barclays as ‘a sustainable bank’ and as ‘a responsible global citizen’. We recognise that this year’s report is a transition to this new outlook, with implementation still underway, and our comments below are made in light of this.
Last year we commented that Barclays should explain the role of a bank in society and in the economy. The new sustainability strategy makes progress in this regard. We also note that Barclays has taken steps to link remuneration to sustainability performance which will assist in embedding sustainability into decision making across the business.
As Barclays continues its international expansion, the Review contains increased coverage of operations in emerging markets, particularly how corporate responsibility and sustainability issues are managed in the Absa business in South Africa. We believe that future reports should show more about other emerging markets, particularly on issues such as financial inclusion where a clearer illustration of the different ways in which Barclays helps financially vulnerable customers along the financial inclusion journey would help to complete the picture. The intention to examine economic impacts in emerging markets more fully should help to extend understanding of the contribution Barclays makes both in these economies and wider.
The 2007 Review also covers more aspects of the business, with more information on commercial and international banking, as well as the investment banking and asset management businesses, Barclays Capital and Barclays Global Investors. As we have commented previously, these businesses contribute a substantial portion of the bank’s overall profits and we believe reporting on the impacts of these businesses should continue to expand. Being a co-founder of the Equator Principles, Barclays has made good progress on assessing its own investments for environmental and social risks. We believe some readers would welcome further information on how these principles are being applied in project finance deals, including a regional analysis and the impacts achieved by those projects. Since Barclays applies more comprehensive social and environmental guidelines to other large loans outside project finance, a fuller discussion of these would also be welcome.
The company is also reporting more fully on how it is tackling its indirect environmental impacts through its engagement with key suppliers, its employees and its customers through new environmental products. This is an area where more data would help show the impacts achieved; spending on suppliers, for example, increased to £7.2billion in 2007 from £4.9bn in the year before.
Last year we recommended that Barclays should report more fully on its efforts to improve customer service in UK Retail Banking, and this has been done. Barclays has stated its intention to implement stronger world-wide data collection systems and this will help provide stakeholders with increased disclosure on issues such as customer satisfaction, as well as diversity, employee attitudes and community involvement. We believe it advisable to consult stakeholders on enhancing future reporting on topics such as human rights.
In addition the inclusion of Barclays approach to topics of interest to some specialist stakeholders would strengthen transparency and accountability, even if not judged material to understanding the company's overall sustainability performance. These could include any involvement in controversial countries or industry sectors such as armaments, customer issues such as bank charges or operational matters such as outsourcing and off-shoring.
Future reporting Looking forward, we believe there are three main areas where Barclays can strengthen its sustainability reporting to meet stakeholders’ expectations.
As a financial services company, Barclays is subject to extensive regulation and supervision by public authorities. During the reporting period, loss of confidence among others in its sector has resulted in government intervention. More information about how regulation takes place in different marketplaces and greater disclosure about relations with governments and regulators would strengthen understanding. This would build on disclosures made this year and extend to reporting on submissions made to consultations, for example, and engagement with political parties and legislators beyond formal political donations.
A second area is the management of assets for clients, now amounting to some $2trillion, where Barclays primary duty is to secure financial returns as instructed by customers. Given growing expectations of the wider role of banks in the global economy, we believe a fuller discussion is warranted about the dilemmas and issues that arise, explaining the approach adopted and how this differs when the bank’s own funds are at risk. This would cover Barclays’ view of its legal duties, the issues on which it has engaged with company management, how votes are cast on governance and other matters, and how engagement varies between European, North American and Asian markets.
Finally, with the new ‘sustainability’ strategy in place, we believe that Barclays should show how this helps the bank to contribute to the wider goal of sustainable development, as defined by governments and other stakeholders. Such a discussion would address what the limitations are on Barclays own responsibilities and where others need to act, as well as the challenges that arise on the journey.
2 May 2008
Note on our relationship with Barclays and on the assurance process Our relationship with Barclays This is the third year that Corporate Citizenship has acted as the external assurance provider for Barclays. We have not worked with Barclays on any other projects during the year.
Separately, Barclays is a member of the LBG (the London Benchmarking Group) – an evaluation framework for corporate community involvement, which Corporate Citizenship manages on behalf of the LBG’s members and adherents. The assurance process As there are no statutory guidelines for social reporting, we have formed our own judgements based on emerging best practice among other companies, the principles of assurance standard AA1000, the approach of the Global Reporting Initiative, the stated views of principal stakeholders and our own professional expertise and experience.
In particular, we have considered the availability of information, sufficiency of evidence, underlying systems and processes, internal assurance systems, adequacy of resources and relevant legal and commercial constraints. We have judged materiality by considering significant legal, regulatory and financial impacts, business policies, the performance of peers and competitors and stakeholder views.
A team of four, led by a director, undertook the assurance and commentary process. A second director acted as advisor to the group. The team has extensive relevant professional and technical competencies and experience. For a fuller description please refer to our website. The assurance process began in January 2008 and was completed in May 2008. Detailed records were kept of meetings, assurance visits and correspondence relating to the materiality, completeness and responsiveness of the report, as well as to technical matters relating to the accuracy and presentation of the data.
Our external assurance and commentary process for the online Sustainability Review 2007 has involved the following elements:
1 A thorough testing of data and statements made during the drafting process of the Review, as well as in the final version on which we based our assurance statement. 2 Meetings and discussions with a cross-section of Barclays businesses about the bank’s approach to corporate responsibility and its transition to sustainability, its policies and performance, its future challenges and its relations with stakeholders, including UK and Global Retail and Commercial banking, Barclays Capital, BGI, as well as Absa and Barclaycard. These interviews were used to obtain evidence to validate data and statements made in the report. Representatives from the following business functions were interviewed: • Community Investment • Consumer Agenda • Corporate Affairs • Diversity • Environmental Products • Environmental Management • Financial Inclusion • Market Research • Public Policy • Risk Management 3 Examination of management and reporting systems, notably for employee engagement, community investment and environmental management. We have relied upon the external verification provided by SGS for the carbon dioxide emissions for Barclays UK and European operations. 4 An analysis of best practice among other companies, the principles of the GRI G3, as well as the Financial Services Sector Supplement and the AA1000 assurance standard. 5 A review of national and international published sources of information about the views and opinions of external stakeholders, including inter-governmental and governmental agencies, academics and special interest groups. 6 An appraisal of Barclays stakeholder engagement activity, principally the employee opinion survey and customer opinion research. 7 A review of external assessments made, notably by the Dow Jones Sustainability Index and BITC’s Corporate Responsibility Index. 8 Site visits to a Barclaycard call centre and to three Barclays retail branches in the UK, representing a range of B5 and B6 level branches. This helped inform our assessment of how Barclays’ corporate responsibility and sustainability policies and commitments are being implemented outside of headquarters. Our work did not extend to a complete audit of the review’s contents nor to direct engagement with stakeholders to seek their views, beyond that mentioned above. We have not been responsible for the preparation of the 2007 online Review nor in devising the internal management and reporting systems that yielded the data contained therein.
The opinions in this external assurance statement and commentary are intended to extend understanding of Barclays non-financial performance and should not be used or relied upon to form any judgements, or take any decisions, of a financial nature. Contacts
If you have any questions or feedback about our report, please send an email to [email protected]
Address: Public Policy & Sustainability Barclays 1 Churchill Place London E14 5HP