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a year in focus
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Mervyn Pedelty, Chief Executive.
In last year's Partnership Report and Financial
Statements, I emphasised our firmly held business
philosophy that sustainable success is best achieved
by those organisations willing to take the broadest view
of their responsibilities. During 2001, The Co-operative
Bank continued to demonstrate just this. We have
again produced record financial results (follow this link for details of our financial results) - at
the same time as receiving a wide range of awards in
recognition of our partnership, ethical and environmental
policies (follow this link for details of our awards). This recognition not only signifies that
the bank has developed a leadership position in these
areas within the financial services industry, but also
demonstrates why we are seen as a leader in the field
of Corporate Social Responsibility (CSR) amongst
businesses of all types. Our aim is to deliver value to all
our Partners in an equitable manner as described later (follow this link for information on how the bank aims to deliver value to all Partners). This is affirmed in the bank's strategic plan,
which sets out our clear market position: 'The
Co-operative Bank is a modern bank that goes about
its business in an ethical manner', as well as our
customer proposition: 'Customer led, ethically guided',
which is communicated throughout our advertising and
promotional activities.
However, we have no intention of resting on our laurels.
Not only is there much room for improvement in the
bank's ethical and ecological performance but other businesses are also starting
to realise the merits of CSR and sustainable
development (follow this link for details of the Ethical Advocates Programme). Outlined below are some of the major
initiatives we launched in 2001 and early 2002, which I
believe will maintain the bank's ethical and ecological
position. I have also, once again, identified areas where
I would like to see particular improvements during 2002.
Ethical Policy review 2001 was a notable
anniversary for us, being ten years since we first
surveyed our customers on a range of ethical issues.
The results of that 1991 survey provided us with the
mandate to publish our original Ethical Policy in May
1992 - a public commitment of who we would, and
would not, do business with. That first poll provided us
with an overwhelming customer mandate for a policy
which has provided a distinctive co-operative point of
difference in a marketplace becoming crowded with
look-alike retail banking services. The results of our
fourth customer poll (follow this link for details of our 2001 Ethical Policy Review) have given us clear
directions once again. Some existing policies have
been extended or strengthened, and some new
policies introduced. This time the survey results have
been collected not just via a postal questionnaire, but
also through web-based and branch-based 'polling
stations'. I am delighted to say that the response rate
for this year's ballot has more than trebled to over
60,000, compared with the 1998 Ethical Policy survey.
With regard to the application of the Policy, I am proud
to report that the bank's social auditor, ethics etc..., has
confirmed once again that, in all instances reviewed,
the bank's Ethical Policy has been fully implemented,
overriding any economic factors.
Enlightened self-interest The bank's
ethical and ecological policies are inextricably linked to
its business success. We find that our customers cite
the bank's ethical and ecological policies - more than
any other single factor - as their main reason for joining
us. In 2001, for the eighth consecutive year, the bank
has produced record pre-tax profits. Profit before tax
was £107.5 million, higher than 2000 by 11.6%.
Earnings attributable to the Co-operative Group were
£68.5 million after tax, an increase of 15.7%. As can be
seen from the analysis (follow this link to the ethical and ecological value analysis), the
bank's ethical and ecological positioning has made a
sizeable direct contribution to the bank's profitability
of around 20%.
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July 2001 - the Secretary of State
for Trade and Industry, the Rt Hon
Patricia Hewitt MP, presents
Mervyn Pedelty, Chief Executive,
with Business in the Community's
'Company of the Year' 2001 award.
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Our people If the most prestigious of the awards
received by the bank in 2001 was our designation as
"Company of the Year" 2001 by Business in the
Community, then the highlights of 2002 to date are the
fact that, despite a greatly increased number of entries,
the bank retained its inclusion in the Sunday Times'
"100 Best Companies to Work For" listing, and the award
to the bank in April of a Queen's Award for Enterprise
in the Sustainable Development category.
The outstanding commitment of our staff is a major
contributory factor to our success. In every staff survey
conducted, we find high levels of pride in the bank as
an employer and as a leading promoter of ethical
business practice. Of the six targets we set last year for
staff development, we have achieved five. Only in the
area of 'opportunity for career progression' did we fail
to meet our target, and in 2002 I will be looking for an
improvement in staff understanding of, and satisfaction
with, different progression opportunities. I will also
be looking for further improvements in the bank's
recruitment and retention of staff from ethnic minority
populations.
Community involvement The bank's
social and ecological ambitions involve all staff, in
much the same way as do our endeavours to provide a
quality customer service. As shown in previous
Partnership Reports, significant numbers of our staff
have always engaged in community projects and
activities whilst representing the bank. However,
involvement levels have varied across the bank. Early in
2002, we formally announced our intention to grant
staff up to three days paid leave to contribute to their
local communities, as long as they match this with time
of their own. This initiative, together with the bank's
Green Genie groups (follow this link for details of the bank's recycling initiatives) and its Ethical Advocates
programme (follow this link for details of our 2001 Ethical Advocates Programme), demonstrates our belief that the
pursuit of sustainable development requires the active
involvement of our employees at all levels. In 2002,
I would like to see an improvement in the number of
staff who state that they believe that 'the bank behaves
ethically in the way it treats its staff', and for the bank
to play a full part in the proposals for a new Co-operative
Foundation (follow this link for information on The Co-operative Foundation).
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The Sunday Times' award; recognising the bank as one of the
"100 Best Companies to Work For".
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Ecological sustainability This year's
Partnership Report presents, for the first time, a
concise table showing the bank's performance over
time in a number of key areas. This shows that the
bank has significantly reduced its ecological impact
over a number of years. Waste has reduced by 36%
per customer account since 1998 (follow this link for details of the bank's waste), carbon
dioxide emissions from our buildings have reduced by
83% per customer account since 1997 (with 98% of all
electricity used now being from renewable sources)
and water usage has fallen by 28% per customer
account since 1999. The amount of land with
significantly increased biodiversity as a result of the
bank's initiatives is seventy-five times greater than the
land occupied by its operations, and is now almost
350 hectares. Furthermore, the switch of the majority
of the bank's company car fleet from petrol to diesel,
combined with a reduction in mail carriage, has
reduced transport CO2 emissions by 6% per customer
account. However, against this, the bank has not
achieved its target to increase the proportion of
ecologically sound paper by 5% and total business
mileage has increased by 300,000 miles. Therefore, in
2002 we will review further our paper purchase
activities and I will also be looking for further net
reductions in the bank's carbon dioxide emissions,
particularly in the area of transport.
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In April 2002, Minister for the Environment, the Rt Hon Michael
Meacher, MP, presented Ken Lewis, Executive Director,
Resources, with the award for the best Sustainability Report in
the UK.
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Innovation The bank continued to innovate with
its products and services in 2001. In June 2001, a new
current account - Privilegei - was launched which, for
a small monthly fee, provides a guaranteed overdraft at
preferential rates, together with free comprehensive
annual family travel insurance and a wide range of
other lifestyle products and services at discounted
prices. At the turn of the year, we enhanced our
mortgage product range with the introduction of
attractively priced five year capped rate and two, three
or five year fixed rate flexible mortgages. As with our
previous mortgage offerings, each comes with a
commitment to offset a percentage of customers'
household carbon dioxide emissions (follow this link for information about green mortgages). We
were also able to take our contributions to countering
financial exclusion a stage further with the piloted
provision of our Cashminder account to vendors of The
Big Issue in the North. Big Issue vendors frequently
lack the forms of identification usually required by
banks from their new customers to comply with money
laundering regulations. By working closely with The Big
Issue in the North, we were able to identify and agree
other forms of identification and therefore help a small
number of vendors to overcome one of the many
barriers they face in entering 'mainstream society'. In
January 2002, we launched a five year stock market
deposit bond, the first ever with an interest rate linked
to the FTSE4Good Index of leading UK companies
meeting FTSE's requirements on Corporate Social
Responsibility. It provides depositors with a return of
up to 66% over five years, with no capital risk.
FTSE4Good is a new FTSE index for socially
responsible investment and includes taking account of
how companies are working towards environmental
sustainability, developing positive relationships with
their stakeholders and upholding and supporting
universal human rights. I was privileged to have been
invited to be the first chair of the new FTSE4Good
Advisory Committee in mid 2001. |
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Early in 2002, customers had the opportunity to profit from
socially responsible stock market investment.
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Co-operation 2001 was a milestone year for
the UK co-operative movement. After extensive
consultation, the new Co-operative Commissionii
published its findings and recommendations in early
2001, which were endorsed at a special Co-operative
Congress in November 2001. There is now an agreed
and forward-looking strategy for the Co-operative
movement, designed to underpin its future success.
The Co-operative Bank, too, will be following through
with a number of important co-operative strategies -
including working much more closely with our sister
financial services enterprise, the Co-operative
Insurance Society (CIS) (follow this link for information about the bank's closer working relationship with CIS). This promises much
for the customers of both the bank and CIS, and should
also provide each business with many new
opportunities.
A discussion on the Co-operative movement would not
be complete this year without a word of congratulation
being extended to Sir Graham Melmoth, Chief Executive
of the Co-operative Group, who was awarded a
knighthood in the 2002 New Year's Honours list. This
award recognises the enormous contribution that
Sir Graham has made to the Co-operative movement
over the years; a fitting accolade to his career, in the
year of his retirement.
2002 and beyond Improving our performance
year after year - across all our Partnership indicators -
becomes an ever greater challenge, particularly in such
a competitive marketplace. However, the clear sense
of motivation, purpose and pride in their work shown
by our staff gives me great confidence in our ability to
maintain our performance levels into the future.
Feedback I hope that this Report, and the
additional information on the bank's website,iii is both
informative and interesting. The feedback we receive
from our Partners is essential to the ongoing
development of both our Partnership Approach and
the management of our 'triple bottom line' of ethical,
ecological and economic sustainability. The bank's
executive and senior management team use the
indicators, data and targets presented in the Report in
their management of the business and will seek to
improve our performance further still. I would be
delighted to receive your feedback once again, so
please do use the pre-paid postcard attached at the
end of this Report, or e-mail your comments to the
bank's Partnership Development Manager, Paul
Monaghan (pmonag@co-operativebank.co.uk).
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- www.co-operativebank.co.uk/privilege/privilege_body.html
- www.co-opcommission.org.uk
- www.co-operativebank.co.uk/partnership2001
To follow any of the links mentioned within the Partnership Report 2001, please visit the links page.
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The above data and commentary has been audited by ethics etc... |
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