Sustainability simply means good business. It means running our Society effectively for the benefit of our members, employees and other stakeholders. It also means maintaining financial strength, optimising our profits in order to return long-term value to our members and following the highest standards of governance.
It has been another record year for Nationwide, with underlying profit before tax up 24% to over £668 million. Our commitment to mutuality underpins this. As a building society, Nationwide is owned by its members and unlike many of our direct competitors we have no shareholders to pay. Economic success is the first element of sustainability but this cannot be pursued separately from our wider responsibilities towards society and the environment. In a year of change, in which we merged with Portman Building Society, announced the sale of two of our subsidiary companies (Nationwide Life and Nationwide Unit Trust Managers) to Legal & General and entered an agreement to sell Legal & General products, I am proud that sustainability remained as high on the agenda as ever.
We reached a significant milestone in our sustainability activities when 97.8% of members who voted at our 2007 AGM endorsed our intention to achieve the Business in the Community PerCent Standard. This means that the Society will donate at least 1% of pre-tax profits to charity, community and environmental activities. Part of this community investment is made through the Nationwide Foundation. This combined effort will ensure that we continue to achieve measurable benefits and outcomes, in particular for those most vulnerable and marginalised. This commitment is not just good for society. Our own research shows that it is good for business, helping us to attract and retain the talented colleagues and loyal customers on whom our future depends.
We remain committed to long-term partnerships with community and charitable organisations. Our successful partnership with Disability Sport Events, now extended to 2012, helps disabled athletes fulfil their potential. Our Cats’ Eyes for Kids scheme has been helping to reduce child pedestrian casualties since its launch in 2001. And our 14-year relationship with Macmillan Cancer Support, our flagship charity, has raised nearly £5 million through employee and corporate donations, including £25,000 raised this year through the World’s Biggest Coffee Morning event.
Continuing the theme of giving something back, we launched ‘Sponsored by you’ in April 2007, a ground-breaking campaign in support of our international football sponsorships. This is designed to give our members access to sponsorship benefits, such as seeing a child they nominate lead out their national team or receiving tickets for international matches.
Environmental matters remain paramount and although our footprint is not significant when compared to some other sectors, I am determined to ensure we continue to reduce our CO2 emissions and minimise other impacts. For example, all our electricity now comes from renewable energy sources and we recycle 100% of our waste paper, the first in our industry to do so.
The future holds challenges and opportunities for all businesses and Nationwide is no exception. As a mutual organisation belonging to our members, shared ownership is part of our culture and I strongly believe in the relevance of this ethos for our sustainability strategy. We know that our members and our other stakeholders will rightly hold us to account for our performance in this area.
Nationwide’s values are expressed in words which are vitally important to my colleagues and myself, but which can only come to life through sustained action. Fairness, honesty, integrity and transparency are the words by which we judge ourselves and by which I now invite you to judge us in reviewing the actions described in this, our fifth Better Society Report.
Graham Beale
Chief Executive
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