What’s material?

To our future strategy at Legal & General Group

In December 2012 we took our Executive Committee (Exco) through a materiality process. This involved taking a wide variety of stakeholders’ opinions of our business, and working through the ones that were material to our current and planned future business activities.

What is materiality?



There is an agenda on this issue
that the outside world has not
understood yet but we have.

We have a stake in this issue,
so does the outside world.
Its in all of our interests to solve it
because of market failure

Importance for L&G’s future

Its an issue in the public eye
in the short term which we
do not have a stake in.
This is for others to solve

Investigate Further

We are not sure what stake we
have in this issue but its high
on the external agenda




Importance for UK economy /
society / environment



We used the above framework to understand what is material to our business.

We discussed a number of issues for consideration amongst the Executive Committee. Here is a flavour f those topics:

“What are we doing to discourage over consumption versus saving?”


“How can we encourage favourable taxation of Green Bonds as a better use of capital than Solvency II?”


“What are we doing to support the development of the Social Housing Sector in terms of pensions, capital and easing their balance sheet?”






“As minds wear out quicker than bodies how will we help customers and employees to cope with mental health problems?”


Suggested Exco and GCSR Material Issues so far


“How do we provide the next generation with real jobs?”





“How can we use ownership of companies through Legal & General Ventures to create jobs ?”



“How can we provide people with a second chance in society whether that be re-offending, losing a job or simply trying to cope with a bad economy?”





“If we are in a 1% returns world how do we help our customers, employees and harder to reach parts of the market to adjust their lifestyles for the next 5 years?”



“How can we support Social Enterprise in the UK Marketplace to grow economically?”






“How can we tackle the obesity crisis rather than just benefit from it?”


“How do we help our customers, employees work until they are 80?”


“How do we inspire the next generation of shareholders and their responsibilities?”

After reviewing a number of options, our Executive Committee set a number of campaigns for our Group over the next three years.

This is how we want to be positioned as a business:

We are a campaigner for better social mobility in the countries that we operate around the world. We strive to make sure that each generation has the opportunity to live a better life than the previous one. What concerns us is that a number of countries around the world there is strong evidence that this may not be the case in the areas of housing, health and providing dignity in later life.

To take each area in turn:


 There are issues of lack of housing supply, homes unfit for purpose and housing wealth locking people into set lifestyles with little movement. Why?


Tthe lack of equality in healthcare services means that choice and access to services is diminishing. Why?

Dignity in later life

The level of dignity and choice when people are in the working population drops when people retire. Why?

We also have a responsibility to do business better each year. Better business with customers, with our suppliers, as an investor and with our employees.”

What does campaigning mean we actually do?

When we campaign for these issues it means that we:

  • establish a consistent ‘house view’ across the Group on the long-term areas important to our customers;
  • partner with recognised experts in the public, private and third sectors to improve our understanding and knowledge of these issues and invest in these organisations so they can do more of their good work;
  • volunteer our time to immerse our employees in the big debates around the topic to improve their empathy and understanding of these issues;
  • research how the issues affect our own employees and current customers;
  • widen the debate with joint campaigning with key points of influence such as investees, suppliers, tenants and government on the issues; and
  • produce a set of new or existing products which solve the issue for our customers and employees.

The Group Corporate Responsibility and Ethics Committee (GRCE) has now taken this strategy and set our 2013 - 2015 ESG targets to improve business performance and support these campaigns.


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