ANZ offers a no-frills account of its sustainability balance sheet
The Australia and New Zealand Banking Group’s approach to corporate responsibility reporting is a bright spot for the otherwise embattled financial services industry. ANZ’s breadth of coverage and commitment to transparency should leave no reader wondering why the company has been named as the Dow Jones Sustainability Index’s number one bank globally, two years running.
One of five quick links on ANZ’s homepage directs readers to a catalogue of policies, data points, newsletters, and, of course, the 36-page performance-driven Corporate Responsibility Review 2008. The bank’s decision to publish an annual performance review while posting more lasting materials on its website is a wise one. It makes the annual review clear, manageable and, for those of us who prefer to read from paper, more printer-friendly.
To say that the review is straightforward would be an understatement. It focuses on what ANZ deems its most material issues – global financial market turmoil, the bank’s expansion into Asia, social and economic inclusion, and social and environmental assessments of corporate customers. Aside from these focus areas, there are no frills. For example, the only pictures included are head shots of chief executive Michael Smith and chairman Charles Goode. Instead, the copy is supported by useful links, charts and quotes that, together, paint a clear picture of the company’s performance.
ANZ strikes a sincere tone in the opening pages with honest discussion of the global financial crisis. The chairman and chief executive messages both speak of the challenges and opportunities that current market conditions present for the company. Chief executive Michael Smith also introduces “responsible products, services and decisions” as one of three core themes for 2009 – a focus that aims to provide customers with greater stability and renewed confidence.
The review further outlines how ANZ is responding to specific financial challenges. For example, we are told the bank is tackling the rising cost of credit by adjusting its capital levels and improving credit risk management practices. Considering that credit market failure is a leading cause of the financial crisis and, therefore, fresh in the minds of many stakeholders, it would be nice to see more banks confront their credit challenges head-on in discussions of responsible business.
ANZ demonstrates innovative approaches and, in many cases, solutions to complex and enduring problems across the spectrum of corporate responsibility. From a communications perspective, perhaps the most interesting are ANZ’s innovations in stakeholder engagement. For example, ANZ publishes and distributes a monthly e-bulletin to some 5,000 stakeholders worldwide, keeping people apprised of the bank’s progress against its existing goals and making reporting as “real-time” as possible.
ANZ is also using mobile technology to reach its customers more effectively. The bank sends SMS messages to mortgage, credit card and personal loan customers to provide them with reminders of upcoming payments and other notices. Through the Wing programme in Cambodia, bank accounts are accessible via any mobile phone device. This branchless banking platform helps ANZ invest in local communities and expand into an untapped market. According to the report: “Less than 5% of Cambodians have a bank account, but 25% own a mobile phone and that figure is growing by 50% every year.”
Balance may be the one area in which ANZ could improve. While the 2008 review is heavy on social content, it is light, perhaps too light, on environmental substance. Though, in fairness, ANZ has established a number of two-year environmental targets that will mature at the close of this year.
Nonetheless, ANZ has ambitious environmental targets in place that warrant more consistent coverage. Most notably, the bank is committed to carbon neutrality across its Australian and New Zealand operations by the end of 2009. The discerning eye will notice that ANZ is behind schedule to meet this goal, which is all the more reason that the bank should have reported on its progress to date in this review.
On a brighter note, ANZ released four social and environmental management policies in 2008 to inform the bank’s decision-making process on transactions involving forestry, greenhouse gas emissions and energy, water, and mining and minerals issues. The policies, which apply to new and existing clients, are designed to help companies balance sustainability with other business considerations. ANZ focused primarily on its forestry policy in 2008, and reports that its approach is attracting new business from companies beginning to think about these important issues.
ANZ’s report provides timely, transparent and, ultimately, credible content. What is most impressive, however, is ANZ’s evolution in reporting over the last five years. From the bank’s first report in 2004, ANZ has improved and grown consistently into the best-in-class reporter that we see today. If the past is any indication, we are in for another fine report in 2009.
Follows GRI G3? Yes; worthy of the A+ application level, but not stated outright.
Materiality analysis? Material issues identified; process not explained.
Stakeholder input? Yes
Seeks feedback? Yes
Key strength: Innovative responses to corporate responsibility challenges.
Chief weakness: Light on in-house environmental performance.
Pleasant surprise: Head-on discussion of the financial crisis.