Corporate responsibility
With a trusted heritage of over 200 years, Schroders has a long-standing commitment to maintaining consistently high standards in all areas of corporate responsibility ('CR'). We seek to:
- Reduce our environmental footprint;
- Support the communities in which we operate;
- Attract and develop the best people;
- Be transparent in our operations and reporting; and
- Encourage and support these principles in the companies in which we invest.
Schroders is an index component of both the Dow Jones Sustainability World Index (DJSI World) and the Dow Jones STOXX Sustainability Index (DJSI STOXX). We are also included in the FTSE4Good Index that is designed to identify companies that meet globally recognised CR standards.
As one of the leading quoted asset managers in the world, we recognise that how we behave can influence other companies in the global financial services market. Our stakeholders, with whom we maintain an ongoing dialogue, include shareholders, staff, non-governmental organisations, the wider community and companies in which we invest. Our behaviour is in turn influenced by our core values - Integrity, Passion, Innovation, Teamwork and Excellence.
Governance structure
A clear delegation of responsibilities forms the backbone of our CR activities. The Board is ultimately responsible for corporate governance and CR within the Group. During 2007, a new Corporate Responsibility Committee was established to provide a strategic framework and better co-ordination of the Group's CR activities. This Committee is responsible for the development of Schroders policies on CR and their implementation through the Group as we look further to embed CR principles in all of our activities and culture, as well as to introduce a formal measurement system.
As part of this change, Alan Brown, Group Chief Investment Officer, has assumed responsibility for all employee, environmental and community involvement issues, socially responsible investment and corporate governance issues relating to the companies in which we invest.
Our approach to corporate responsibility is built around four main areas:
- Workplace;
- Marketplace;
- Environment; and
- Community.
Workplace
Schroders has more than 2,800 people across 28 countries. Throughout our 203-year history, our people have always been our most important asset, at the heart of everything we do. It remains a priority for us to develop, manage and retain our talented people in order to deliver our potential as an organisation. We want to be an employer of choice and we work to ensure that our employee policies reflect best practice within each of the countries where we operate and that our staff understand the strategic aims and objectives of the Group, are clear about their role in achieving them and are aware of and participate in the wider community.
An Employee Consultation Forum was established in the UK in 2005, consisting of employees elected by their peers. Members of the Forum meet regularly with management as part of a Joint Consultative Group which discusses employee-related matters and provides feedback and recommendations to the senior management team.
High ethical standards
We actively promote high ethical standards. Concerns about behaviour or decisions that are perceived to be unethical can be raised by employees through our internal whistleblowing process. Personal securities trading by employees is regulated and monitored to ensure this does not lead to conflicts of interest. Staff are not permitted to solicit or accept any inducements which are likely to conflict with their duties to clients. Training is provided in relation to these issues and in relation to money laundering, terrorist finance and data protection.
Remuneration
Our approach to remuneration is consistent with our ambition to be an employer of choice. We have developed flexibility to enable our staff to personalise their remuneration package to suit their own needs and ambitions.
As a further example of our commitment to our staff, at the end of 2007, we announced our intention to significantly enhance the defined pension contribution rates for UK staff from 1 March 2008. Pension arrangements in other locations have also been reviewed.
Further information on our remuneration policy is outlined in the remuneration report.
Personal development
Our performance management process comprises an annual performance appraisal against agreed objectives and our core values. Output from this performance process is used to inform decisions on remuneration, career development and progression. In creating a high performing organisation, we recognise the importance of encouraging all our employees to learn, develop and fulfil their potential. We provide our staff worldwide with access to a wide range of training and development opportunities that are relevant to our business.
Diversity
We are committed to providing equal opportunities and seek to ensure that our workforce reflects the diversity of the many communities in which we operate.
A flexible working policy has been developed to recognise the diverse needs of employees in managing the responsibilities of their work and personal lives. We believe that achieving an effective balance in these areas is beneficial to both the Group and the individual. We recognise that through the attraction and retention of a diverse workforce we are better able to understand the needs of all our clients. It is the Group's policy to give full and fair consideration to applications from disabled persons, having regard to their particular aptitudes and abilities. For the purposes of training, career developments and progression disabled employees (including those who become disabled during the course of their employment) are treated on equal terms with other employees. We operate a zero tolerance policy to harassment and bullying.
Health and safety
We promote high standards of health and safety at work and have a globally implemented health and safety policy, which we expect all staff to follow and which highlights our commitment to ensuring employees are provided with a safe and healthy working environment. Training is also offered to all staff.
Marketplace
As a leading asset management group, investing over £139.1 billion on behalf of our clients, our investment decisions have a greater impact than our direct operational activities.
Schroders initially introduced a socially responsible investment policy in 2000 to enhance our approach to corporate governance. This policy meets the ABI Disclosure Guidelines on Socially Responsible Investment and endorses the Voluntary Code on Shareholder Activism issued by the Institutional Shareholders Committee. A copy of the policy is available on our website.
In 2007, Schroders became a signatory to the United Nations Principles for Responsible Investment ('UN-PRI') that provide a framework for how to consider environmental, social and corporate governance issues into our investment decision making.
We are also a founding member of the Institutional Investors Group on Climate Change, signatories to the Bali Communique issued by the Corporate Leadership Group on Climate Change and a member of the Carbon Disclosure Project.
Our investment process incorporates research into the corporate responsibility performance of companies and we engage with companies where the scope of environmental, social and governance codes falls short of acceptable standards.
During 2007, Schroders voted on 122 shareholder resolutions of a social, ethical or environmental nature and engaged in dialogue with 69 companies on these issues to improve our analysis.
Number of companies engaged with on CR issues
In addition to our engagement activities we also utilise the research of the Ethical Investment Research Service. This enables us to screen investable universes in order to reflect clients' values in their investment portfolios. At the end of 2007, Schroders had £9.2 billion of funds under management which had some form of ethical criteria attached to them.
Environment
We are committed to continuous improvement in minimising the negative environmental impact of our operations and to the promotion of positive environmental practices. We measure our performance in terms of waste management, water usage and energy usage.
Waste management
We try to balance business needs with the aim of reducing our consumption of materials. In 2007, we saw a 12 per cent. reduction in waste generation, and through the introduction of further recycling initiatives and staff awareness campaigns we continued to beat our target to recycle or reuse over 90 per cent. of our waste.
| 2006 | 2007 | |
|---|---|---|
| Waste generated (tonnes) | 685 | 568 |
| Waste recycled or reused (per cent.) | 92 | 91 |
| Waste generated (tonnes per employee) | 0.256 | 0.196 |
Schroders has been awarded the Platinum Award in the City of London's Clean City Scheme for the third year running. The award places us in the top 20 out of 1,300 buildings in the Scheme, which recognises good waste management and effective recycling.
Water usage
We are also committed to the efficient use of water and encourage our staff to conserve water. However, in 2007, our consumption of piped water increased as a result of the refurbishment work undertaken at our Gresham Street office in London.
Total water consumption
cubic metres
Water consumption per employee
cubic metres
Energy usage
Our energy usage is one of the most significant impacts that our operations have on the environment. Schroders has monitored and managed its energy consumption for several years and continues to look for new opportunities to minimise our usage wherever possible. In 2008, we intend to install an electrical sub-metering system at our Gresham Street offices, better to understand and target efficiencies in our energy consumption.
Total energy consumption for 2007 across our London offices has decreased by 3.6 per cent. compared with 2006, primarily reflecting the building work undertaken during the year to refurbish our Gresham Street offices and reduce our IT load through consolidation and decommissioning of redundant equipment.
As part of this work, we have introduced more energy efficient systems and more advanced controls to reduce our overall consumption.
Energy consumption
Mwh
Energy consumption per employee
Mwh
Almost all of our staff in London travel to work by public transport. All business travel is approved and authorised by line managers and the use of video conferencing as an alternative to travel is actively encouraged. We have increased the number of video conference facilities in London and are developing a programme to increase the number of video conferencing facilities at our other offices during 2008.
Community
We encourage all staff to participate in the community and in civic and charitable causes. Involvement is valuable to the community and also assists personal development.
Charitable giving
Our charitable giving has in recent years focused on employee choice with the Group 'matching' staff donations and sponsorship. In 2007, the Board agreed to increase our charitable giving to include discretionary donations, doubling our donations to £1.25 million.
A new Charity Committee was established to receive nominations from staff for potential donations, targeted at specific projects in the areas of education, development and health. Fifty-two applications were considered before five donations of between £50,000 and £100,000 were made.
A number of our offices operate payroll giving schemes of which the UK scheme is the largest. At the end of 2007, nearly 16 per cent. (2006: 16 per cent.) of UK staff were participating, making charitable donations totalling £197,317 through this scheme. We again received the Payroll Giving Quality Mark Gold Award in 2007, in recognition of over 10 per cent. of staff giving money to charity via the payroll.
Volunteering
As well as making financial donations, staff are encouraged to spend time working in the community. Since June 2005, staff in the UK have been able to take up to 15 hours paid leave per year to provide volunteer services. Many staff regularly volunteer their own time to work in the not for profit sector, utilising their business experience.
Overseas volunteering
During 2007, Schroders staff continued to volunteer to help Habitat for Humanity, a global charity dedicated to eliminating sub-standard housing and homelessness. Investing time to help build homes with their colleagues enables employees to build strong team relationships and develop their communication skills, whilst making a positive and lasting contribution to the communities they help. Schroders contributes 50 per cent. of the cost of participating, with employees meeting the remainder as well as raising money for the charity.
Local community involvement
In London, Schroders is a significant corporate supporter of the Hackney Schools Mentoring Programme, established in 1996 by the East London Business Alliance and Hackney Learning Partnerships. Our staff continue to help mentor 14 and 15 year old students in the London Borough of Hackney to increase students' self confidence and improve their academic performance and allow them to gain experience of the working world and to broaden their aspirations. A number of staff also help primary school children with literacy skills.