Corporate Responsibility

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Corporate Responsibility

  1. 1. Corporate Responsibility Report 2006 Responsible banking
  2. 2. Key facts 2006 2005 % change Financial Total income net of insurance claims £21,595m £17,333m 25% Profit before tax £7,136m £5,280m 35% Tax £1,941m £1,439m 35% Earnings per share 71.9p 54.4p 32% Dividend per share 31p 26.6p 17% Tier 1 capital ratio 7.7% 7.0% – Total shareholder return 25% 21% – Customers Total customers 27m 25m 8% Number of branches outside the UK (including Absa) 1,613 1,516 6% Total UK current accounts 11.5m 11.1m 4% Barclaycard: International cards in issue 6.4m 4.3m 49% Employees Full-time equivalent (FTE) 122,600 113,300 8% Total employee remuneration £8,169m £6,318m 29% Employee opinion survey: Response rate 87% 84% – Employee opinion survey: Employee engagement 76% 72% – Environment UK CO2 emissions 222,773 tn 210,178 tn 6% UK carbon intensity (tonnes CO2/£m income) 16.2 16.8 (4%) UK energy consumption (offices) 472 GWh 497 GWh (5%) UK energy consumption (offices) per person 7,544 kWh/FTE 7,925 kWh/FTE (5%) Water use per person 11.9m3/FTE 12.3m3/FTE (3%) Environmental Management System coverage: • UK 100% 95% – • Africa, Americas and Asia Pacific 94% 25%(a) – Community Total investment £46.5m £39.1m 19% Volunteers: time committed 75,586 hrs 77,413 hrs (2%) Employee participation: community programmes 33,000 people 27,000 people 22% (a) 2005 figures do not include Absa. Member of the Member of the BITC Corporate PerCent Club Carbon Disclosure 2006 Dow Jones 2006 FTSE4Good Responsibility Project Sustainability Index Index Index Ranked in the top 3rd position 50 of the global FT 500 companies Contents Introduction Responsible banking Inside Barclays Measuring performance 1 Group Chief Executive’s 8 Our customers 37 Our people 57 Data tables introduction 13 Responsible lending 42 Managing our IBC External assurance 2 Barclays around the world 16 Financial inclusion environmental impact statement 4 Corporate Responsibility 22 Financing commercial 46 Barclays in the community BC Contact details Director’s statement customers 52 Our governance framework 6 Summary of our 26 Growing internationally 54 Creating value for commitments 31 Facing climate change stakeholders 34 Working with our suppliers 55 Engaging our stakeholders
  3. 3. Introduction Group Chief Executive’s introduction Responsible banking John Varley Group Chief Executive In the year since we issued our last report, key stakeholders and have improved our there has been a further marked increase in performance in a number of ethical indices. the importance attached to Corporate In support of our commitment to raise the Responsibility (CR). Over the course of the profile of CR further, Gary Hoffman, the last 12 months, CR has become more than I want us to be leaders, Group Vice Chairman, now represents this just good business sense – in 2007 no not followers, in corporate agenda at Board level. We made progress organisation can afford to ignore its scope responsibility. with innovative financial inclusion and its implications for business. programmes in the UK and Africa, while Absa became the first major South African There are two key developments driving guidelines. But we need to plan for the years bank to achieve ISO14001 accreditation for this change. The first is the growing, and ahead so we are undertaking a thorough its environmental management system. increasingly widespread, understanding review of our environmental and climate of the consequences of climate change. Sustainability is an appropriate topic for an change strategy. The second development is the evolving organisation that can trace its roots back well debate around sustainability, and the long- Preserving the environment for future over 300 years. But I am looking to the future term impact business has on the societies generations reflects the evolution in when I say that we are fully committed to and economies in which it operates. Neither thinking on sustainability, and the need to action – we must debate, we must learn and of these issues is particularly new – what is assess the impact of business over decades, then we must act, to ensure the successful unprecedented, however, is their adoption rather than years. It shifts the emphasis and responsible development of our and embrace by so many different and from a relatively near-term focus on business in the years ahead. interested parties. managing social, ethical and environmental risk, towards a more active form of business Banks play an important role in influencing leadership, which identifies and embraces thinking and behaviour on both these the commercial opportunities arising from issues, through their relationships with this change in thinking. Sustainability is also This is our eighth Corporate Responsibility customers, clients, employees, suppliers, very much about playing our part in building Report. It is intended for all those governments, non-governmental a more inclusive and just society, by stakeholders who are interested in the organisations and other stakeholders. addressing acute challenges such as This role as influencer is a core tenet of Speeding up making towards our goal progress we are the mortgage financial exclusion. This has always been an of sustainability. responsible banking – which embodies area of strength for Barclays and we remain process the Barclays approach to CR. I repeat my We aim to set out why corporate determined to build upon it, both in the UK In 2006 we asked a panel of 100 message from last year’s report: I want us responsibility is an integral part of our and in our strongly growing business across customers about their experiences of our to be leaders, not followers, in corporate business strategy and how we are emerging markets – particularly in Africa. mortgage application process, and as a responsibility. addressing and prioritising the social, We make our greatest contribution to result we decided to bring the business If we look at climate change, it is right environmental and ethical challenges society by being good at what we do, and back in-house, including the servicing arm that Barclays should assess – as others and opportunities we face in our business so ensuring Barclays continued success. of it. quite properly will – whether we are around the world. This is at the heart of our ability to help our Even though the volume of business is doing enough to tackle an issue with Barclays is committed to transparency in customers and clients achieve their goals growing rapidly at the moment the such significant consequences. We have the reporting of these issues and, to this through providing competitive products feedback about the new approach is done much to address our direct end, our report has been produced taking and services, as well as supporting positive so far, and the average time it environmental footprint, and have fulfilled account of the international AA1000 economic growth and sustaining healthy takes to get from application to offer is the commitment we set last year to make Standard and in accordance with the financial systems. We must demonstrate down to 10 days from 16, an our UK operations carbon neutral. In our 2002 GRI sustainable reporting guidelines, by our actions how it is possible to make improvement of 37%. direct sphere of influence, we are well under including the Financial Sector Supplements. a significant and lasting difference. way with environmental as well as social A full GRI analysis is available at and ethical screening of our supply chain. Last year, we made encouraging progress in www.barclays.com/ In our lending activity, we have significantly CR. Under Alastair Camp’s leadership, we corporateresponsibility. updated our environmental as well as social are developing broader relationships with Barclays PLC Corporate Responsibility Report 2006 1
  4. 4. Introduction Barclays around the world Canada Barclays Capital BGI USA Barclaycard Barclays Capital BGI The Caribbean Mexico Barclays Wealth Barclays Capital Brazil Barclays Capital Argentina Barclays Capital Operating in over 50 countries and employing 123,000 people, we move, lend, invest and protect money for over 27 million customers and clients the world over. UK Banking Barclaycard International Retail and Commercial Banking (IRCB) Delivers banking solutions to Barclays UK A multi-brand consumer lending business Provides Barclays international personal retail and business banking customers. which also processes card payments for and corporate customers with banking It offers a range of integrated products and retailers and merchants and issues credit and services. The products and services offered services and access to the expertise of other charge cards to corporate customers and to customers are tailored to meet the Group businesses. Customers are served the UK Government. It is one of Europe’s regulatory and commercial environments through a variety of channels comprising the leading credit card businesses and has an within each country. branch network, automated teller machines, increasing presence in the United States. telephone banking, online banking and relationship managers. UK Banking is managed through two business areas, UK Retail Banking and UK Business Banking, the latter providing relationship banking to medium-sized and larger business customers. www.barclays.co.uk/personal www.barclays.co.uk/business www.barclaycard.com www.barclays.com 2 Barclays PLC Corporate Responsibility Report 2006
  5. 5. Sweden Barclaycard Norway UK Barclaycard UK Banking and all other businesses Isle of Man Barclays Wealth Denmark Ireland China Barclaycard UK Banking Barclays Capital Netherlands Barclays Capital Barclays Capital Jersey/Guernsey Germany Japan BGI Barclays Wealth Barclaycard Barclays Capital France Switzerland Barclays Capital BGI IRCB Barclays Capital BGI South Korea Barclays Capital BGI Luxembourg Barclays Capital Barclays Wealth Barclays Capital Spain Italy Taiwan Barclaycard Monaco Barclaycard Barclays Capital Portugal IRCB IRCB Barclays Capital Barclaycard Barclays Wealth Barclays Capital Cyprus Hong Kong Barclays Wealth IRCB Barclays Wealth Barclays Capital Malta Barclays Barclays Capital Wealth BGI Gibraltar Barclays Wealth Barclays Wealth Barclays Wealth Thailand United Arab Emirates Egypt Barclays Capital Barclaycard India Barclaycard IRCB Barclaycard IRCB Barclays Capital IRCB Uganda Barclays Wealth Barclays Capital IRCB Malaysia Kenya Barclays Capital Ghana Barclaycard IRCB IRCB Barclays Wealth Nigeria Barclays Wealth Tanzania Seychelles Singapore IRCB Barclaycard Angola Barclaycard Barclays Wealth IRCB IRCB Barclays Capital Zambia BGI Indonesia Barclaycard Barclays Wealth Mauritius Barclays Capital IRCB Barclaycard Botswana IRCB Barclaycard Mozambique IRCB IRCB Australia South Africa Zimbabwe Barclays Capital Barclaycard IRCB BGI IRCB Barclays Capital Barclays Wealth Barclays Capital Barclays Global Investors (BGI) Barclays Wealth A leading global investment bank which One of the world’s largest asset managers Serves affluent, high net worth and provides large corporate, institutional and and a leading global provider of investment intermediary clients worldwide, providing government clients with solutions to their management products and services. private banking, asset management, financing and risk management needs. BGI offers structured investment strategies stockbroking, offshore banking, wealth Barclays Capital services a wide variety of such as indexing, global asset allocation structuring and financial planning services. client needs, from capital raising and and risk controlled active products Barclays Wealth works closely with all other managing foreign exchange, interest rate, including hedge funds and provides related parts of the Group to leverage synergies equity and commodity risks, through to investment services such as securities from client relationships and product providing technical advice and expertise. lending, cash management and portfolio capabilities. transition services. www.barclayscapital.com www.barclaysglobal.com www.barclayswealth.com Barclays PLC Corporate Responsibility Report 2006 3
  6. 6. Introduction Corporate Responsibility Director’s statement Setting the right priorities Alastair Camp Corporate Responsibility Director During the year we engaged actively Operating a responsible business with our many stakeholders. In this report, we discuss the subjects they consider most important, and how we use our dialogue Why we are in business: to inform our responsible banking agenda • Helping customers Our achieve their and to set the right priorities. We talk about Business financial goals. how we are responding to feedback, and Purpose • Total Shareholder Return. specifically to the annual consultation on our last Corporate Responsibility Report Our strategy and the opinions provided by our external assurer. Stakeholder Risk mitigation Economic and commercial input We took the deliberate decision to opportunity raise our profile in this area over the Social Environmental past year, undertaking a much broader programme of consultation with stakeholders, particularly investors and NGOs. We have spoken more often, and Our Foundation Stones Our values more publicly, on corporate responsibility Code of Statement questions, because these events give us Guiding of Human Principles Conduct the opportunity to exchange views openly, Rights and we have found that this has created a virtuous circle of further dialogue and action. Climate change, financial inclusion in the UK and Africa, and the incorporation of social and environmental concerns into lending guidelines, are all good examples The judgements we make in our The issues reflect both ‘direct impacts’ of areas where we have benefited from prioritisation take into account: (which derive from our own business external input. activity) and ‘indirect impacts’ (which are • Our overall business goals. the result of actions taken by our customers • An assessment of the strength and How we prioritise our issues or suppliers). breadth of stakeholder views. The idea of sustainability is an integral part • How we can build employee and Looking ahead, our main challenges for of our commercial strategy, as well as the customer trust, and the reputation and 2007 are to: way we do business. As a global business, value of our brand. we are concerned with a wide number of • Ensure that our strategy remains • How social and environmental insights social, ethical and environmental issues. responsive to the fast-developing issue can assist the development of our We have well-established procedures to of climate change. business around the world, and open ensure that we assign the right priority to • Develop our financial inclusion and up new commercial opportunities each of them, which take account of our Microbanking programmes further, (for example, through the opportunity to own business strategy alongside a careful especially in the developing world. develop innovative customer products assessment of their importance to our and services). These priorities are reflected in our progress various stakeholders. • How we can best mitigate our report and new commitments for the operational and reputational risks. forthcoming year. The structure of this report highlights the main topics on our corporate responsibility agenda, and shows how these relate to our business strategy, and to our business units. 4 Barclays PLC Corporate Responsibility Report 2006
  7. 7. Linking CR issues to our business strategy We think it is important to link the CR issues covered in this report with our business Acting on feedback strategy and show the main business units to which the issues relate. After the publication of our last Corporate Barclays business strategy has four core priorities: Responsibility Report we undertook extensive consultation with investors, A Building the best bank in the UK. consumer groups, global and national B Accelerating the growth in our global businesses (investment banking, institutional NGOs, governments, media and corporate asset management, wealth management and international cards). responsibility specialists. Their views were C Developing retail and commercial banking in selected countries outside the UK. many and varied, but there were some D Enhancing our operational excellence. recurring themes. The table below shows these links in more detail. Report section – Key CR issues covered Link to Barclays Principal business units to Positive comments: business strategy which issue relates • Our ‘responsible banking’ theme was well received as a good way to integrate Responsible banking corporate responsibility with business Our customers strategy. Treating customers fairly, customer A, B, C, D All businesses • People liked the issues-based approach satisfaction, secure delivery channels, and context: 88% of respondents anti-money laundering agreed that the issues we chose should indeed be our major concerns. Responsible lending • 75% of previous respondents felt Levels of consumer indebtedness A, D UK Retail Banking, Barclaycard that we had acted on the feedback Financial inclusion they had given. Improving access, affordable credit A, C UK Retail Banking, Barclaycard, • The sections on financial inclusion, and savings for excluded groups; International Retail and Africa, community investment and environmental management were seen developing financial capability Commercial Banking (IRCB) as particularly strong. Financing commercial customers Sustainable lending: environmental A, B, C Barclays Capital, Negative comments – and how we and social impacts UK Business Banking, IRCB have responded • People felt that there was a need for Growing internationally more detail in the consumer lending Supporting development C IRCB section. We have included more and inclusion; HIV/AIDS background on this issue this time. Facing climate change • We were asked for more detail on how Managing our carbon emissions; A, B, C, D All businesses we prioritise our corporate responsibility developing climate related products issues. We cover that in this report, together with a statement of how we Working with our suppliers create value for all our stakeholders. Supplier management D All businesses • People wanted us to ensure that wider issues that are important to other stakeholders are also included. We have Inside Barclays aimed to give a broader context in this Our people report, as well as including candid Our values, talent and A, B, C, D All businesses views from other organisations development, diversity involved in these fields – even if we do not always agree with them – and say Managing our environmental impact where we disagree. Managing our physical resources, D All businesses • More detail was requested on how reducing our footprint corporate responsibility is integrated Barclays in the community into the business. A more detailed Global community A, B, C All businesses section on governance is included investment strategy this time. The Barclays Annual Report 2006 provides more detail on strategic and financial progress and can be found at www.investorrelations.barclays.com. Barclays PLC Corporate Responsibility Report 2006 5
  8. 8. Summary of our commitments Goals in 2006 Progress Commitments for 2007 Our customers • Develop new electronic payments • New faster payments service is on • Maintain momentum on customer 27 million customers service, ready for launch by end 2007. track for November 2007 launch. service and satisfaction. and clients worldwide • Continue to improve customer • Progress sustained – customer • Complete the Barclays/Woolwich satisfaction in UK Retail Banking. advocacy up 10% since end 2004. branch and infrastructure integration programme. • Continue development of online • Strong focus of attention – • Continue to improve disability banking security features. continual improvements made. access to products and delivery channels. Responsible lending • Encourage an increase in the • Most major credit card issuers have • Drive progress on data sharing Taking a lead role on number of organisations sharing signed-up to ‘Behavioural data initiatives. data sharing credit information. sharing’ and good progress achieved • Continue data review to ensure we on current account data sharing. make the best credit decisions for our customers. • Pilot programme to identify and help • Pilot scheme implemented first • Develop electronic information customers who may be approaching half 2006. to help customers make informed financial difficulty. decisions. Financial inclusion • Embed the Ghanaian Microbanking • Programme has reached 80,000 • Reach 500,000 people through Barclays and Absa have programme; use learning to develop market traders; extended to credit Microbanking in Ghana. opened almost one million new microfinance initiatives. union sector. basic bank accounts • Review our UK basic banking • Consultation with three consumer • Target Cash Card customer proposition to ensure it meets the groups has led to product satisfaction score of 89%. needs of a diverse customer base. enhancements. • Encourage a strong UK community • We remain the leading private • Play a leading role in driving finance sector. sector supporter of credit unions sustainability in the credit union in the UK. sector to reduce financial exclusion. Financing commercial • Improve understanding of social • Lending sector guidance reviewed • Continue environmental and customers issues relating to Equator Principles and extended to cover our whole social risk training programme. Our revised environmental and include in updated sector commercial lending book and social sector guidance guidance. (over 50 sectors). has been shared with • Provide training on environmental • Training conducted for over 120 • Collaborate with United Nations 170 institutions risk and the Equator Principles to employees in project finance, Environment Programme to colleagues in Absa. investment banking and credit develop our approach to human teams. rights in risk management. Growing internationally • Expand branch and cash machine • Customers have access to some • Significant growth in branch and Ten million customers network in South Africa. 6,700 cash machines (up 16%) cash machine network across our in Africa and 749 branches. African businesses. • Increase take-up of Mzansi basic • We now have 518,000 Mzansi basic • Grow basic banking services bank account in South Africa. bank accounts in South Africa. targeting disadvantaged people. • Further develop HIV/AIDS • Leading HIV education, counselling • Continue progress towards the awareness and participation in and testing programmes in place achievement of Black Economic employee welfare programmes. across African businesses. Empowerment targets in South Africa. 6 Barclays PLC Corporate Responsibility Report 2006
  9. 9. Goals in 2006 Progress Commitments for 2007 Facing climate change • Make UK operations carbon • UK carbon neutrality achieved. • Work towards becoming globally Our UK operations neutral. carbon neutral. are now carbon neutral • Renewable energy purchased for • Source renewable energy for 50% of UK operations. international operations. 100 % • Investigate carbon management services for SMEs, personal customers and employees. • UK carbon neutral debit card launched. • Develop further environmental products for personal customers and launch employee guide on climate change actions. Working with our • Review our suppliers using • New corporate responsibility • Continue application of suppliers enhanced screening tool and build supplier questionnaire launched. questionnaire to medium and 57 medium and high-risk into new supplier contracts. • 57 medium and high-risk suppliers high-risk new and existing suppliers and reviewed to date (see page 35). suppliers. £1.5 bn of supplier spend reviewed Our people • Further improvement in key • Good progress: employee • Improve employee opinion scores 123,000 employees in employee opinion survey scores. engagement up from 72% to 76%. to high-performing norm. over 50 countries • Acquire and develop talent with • Focus on talent sustained – 21% of • Improve satisfaction scores increased momentum. senior managers are now female. for disabled, gay and lesbian colleagues. • Ensure line managers have the • In place. Strong focus on talent • Increase the proportion of women tools they need to meet the ‘Best recruitment and development. in senior grades. People’ guiding principle. Managing • Meet 2006 environmental • Good progress on energy use in • Continue progress towards 2010 environmental impact improvement targets. offices, water and waste targets – CO2, energy, water and First position amongst management. waste (see page 58). banks in the Dow Jones • Implement our Environmental • Absa in South Africa and Barclays • Continue to extend the EMS Sustainability Index for Management System (EMS) in France achieved ISO14001 internationally. environmental reporting Italy and South Africa. certification. • Establish new programmes to eliminate sources of waste. Barclays in the • Launch programmes with Help • Partnerships successfully launched • Increase participation in employee community the Aged and NCH, the children’s in June 2006. community programmes by 5%. £46.5 million global charity. investment • Develop a co-ordinated global • New programme developed and • Drive globalisation of community in our communities community investment rolling out through 2007. programme, increasing non-UK programme. funding to 25% of total. • Increase participation in employee • 33,250 employees participated in • 30% of community investment to community programmes 2006, an increase of 22%. be focused on ‘Banking on brighter (volunteering, fundraising futures’ theme (see page 48). and giving). Barclays PLC Corporate Responsibility Report 2006 7
  10. 10. Responsible banking Significant investments are being made to ensure that our customer service standards are consistently achieved. 8 Barclays PLC Corporate Responsibility Report 2006
  11. 11. Our customers Work in progress Everything we do starts with our customers. That may sound like a truism but we are in business to help them. Our customers are at the heart of what we do, although the banking industry as a whole has not always had a strong reputation for customer service. From a Barclays perspective, we have set ourselves high standards for customer service right across the Bank. That clear intent is being backed up by significant investments to ensure that our standards are consistently achieved. Fair play Consumer Code. The main areas which There are certain basic principles that have been updated are access to basic underpin everything we do in relation to bank accounts, how changes to the interest our customers: we should be open and rates applicable to savings accounts are At a time of falling customer managed, and the way credit assessments transparent, we should ensure that our products always meet genuine needs, and trends [across the finance are conducted before loans are made. we should give people all the information industry], Barclays improved its they need to make an informed choice. position and is now first among Products Treating customers fairly is not just about We are embedding these principles into the UK banks in terms of good customer service, it is also about the way we do business by aligning many customers believing it takes developing the right products, and of our employees’ pay and performance targets with the quality of service which its CR seriously. providing clear and straightforward information about them. We are working customers receive. In the past we had a hard to make all of our products simpler Source: MORI survey, 2006 more traditional approach to sales and and more transparent. An example is the targets, but now customer satisfaction ‘lifetime tracker’ mortgage, which was plays a key role. For example, in Barclays Treating customers fairly Wealth, rather than have a sales incentive Investing in training Our own principles on fairness reflect the structure, our focus is on providing the right In the UK all our cashiers now go through Financial Services Authority’s agenda on product for each customer, adapted to their a 16-week induction programme, which treating customers fairly. This covers own circumstances and attitude to risk. covers detailed training on our systems subjects such as: Across our retail business we have made as well as modules on customer service. complaint-handling a particular priority. This is followed up with ongoing • Product design We have overhauled many of our assessments back at their branch, which • Marketing and promotion procedures, and improved the way we lead eventually to full accreditation. • Sales and advice processes investigate the root causes of the most Last year, 1,400 employees successfully • Remuneration common problems. A ‘Red Flag’ scheme completed the scheme. • After-sales information • Complaint handling has also been introduced which means In South Africa, Absa runs a full set of that customer feedback can be acted upon training programmes, and in 2006 a total within 24 hours. of ZAR 118 million was invested in the Barclays continues to support the Banking training of 21,000 employees. Codes in the UK which provide – via self- regulation – additional protections to consumers and to businesses, charities, clubs and associations. In 2006 we worked with the British Bankers’ Association to make further improvements to the Barclays PLC Corporate Responsibility Report 2006 9
  12. 12. Responsible banking Our customers developed in response to customer We launched a revised and more feedback, and has no application fee and Assets under management comprehensive website, covering no tie-ins. Barclays Global Investors (BGI) is one of disability access to all our branches, the world's largest managers of exchange products and services. We also made We are responding to the growing requests traded funds under the iShares brand, changes to our online banking service to clear payments more quickly. We have which are index funds that trade like for visually impaired customers, been giving immediate value on personal shares. Each share represents a portfolio including improvements on-screen cheques up to £1,000 paid into Barclays of stocks designed to track closely one and new speech reader software (visit accounts for over eight years, but this is specific index. These investment products www.barclays.co.uk/accessibleservices/ an issue that affects the whole banking trade on a stock exchange and can be branch_banking.html for more sector, and it will only be fully resolved by bought through most stockbrokers, information, or call Barclays Information taking an industry-wide approach. We are allowing the flexibility to invest in indices Line 0800 400 100). working with other banks and APACS, the UK trade association for payments, to focusing on environmental, social and In preparation for the Mental Capacity develop an electronic payments service governance criteria, such as iShares KLD Act, Barclays is implementing processes that can transfer cleared funds within two Select Social Index Fund and iShares KLD and training to equip our frontline hours. This is scheduled for launch in 400 Social Index Fund. employees with the necessary knowledge November 2007. BGI is also one of the largest asset and skills they need to deliver the right management companies in the world with services. We applaud the goals of the Act, We have responded to the very different over US$1.8 trillion under management; it but believe that it represents a challenge, circumstances of the African market by has over 2,800 clients in 52 countries. By particularly with regard to employees being introducing a different way of assessing serving institutional asset management required to make judgements on the mental applications for loans from small- and clients with actively managed and indexed capacity of customers. medium-sized businesses. Many of these customers simply do not have traditional strategies, our investment returns are Our new offices in Zaragoza, Spain, are financial statements that they can show us, benefiting tens of millions of individual being designed with accessibility in mind. and we now make our decisions based on pension participants worldwide, providing So far 29 of our offices across Spain have their bank account and how they have consistent and reliable returns to finance been through the programme which will managed it. their retirements. be completed in 2007. In June last year we announced that we Branches and ATMs planned to integrate the branch networks For many customers, our branches are the UK, where some of our branches have and supporting infrastructure for Barclays Barclays front door. We are making large needed refurbishment. Likewise many and the Woolwich. This will mean extra investments in Spain, Portugal and Italy, branches have been made more accessible investment in the newly combined branch where we opened 50 new outlets in 2006, for disabled people. We have spent a total network, and in the Woolwich name as taking the number in those countries to of £84 million on this programme, and 95% our flagship mortgage brand. Under these some 590. And in Africa, Absa and our of our branch network now has disability plans Woolwich and Barclays branches other businesses on the continent are all access. This represents the large majority within 300 metres of each other will be focusing on extending their reach, of branches that can have their access consolidated onto one site. The aim is to especially into rural areas, where we are improved; whilst our ideal is complete avoid duplication and improve customer using creative new ways to offer branch accessibility, issues such as planning service by using the same IT systems across services even where we do not have a permission and the physical structure of the network. Woolwich customers will get traditional bricks-and-mortar building. some buildings make this impractical. access to four times as many branches as There is more detail on this in the chapters Where we cannot improve accessibility, we before, as well as to Barclays ATMs and on financial inclusion and growing still provide the same features for disabled some 12,000 Post Offices where Barclays internationally. customers as are found in our other current account customers can withdraw In terms of the overall Barclays branch branches, such as hearing induction loops cash free of charge. network the obvious priority has been and low-level writing surfaces. Improving our service Significant investment in the principles of Treating Customers Fairly means better products, more employee training and an improved experience for our customers. 10 Barclays PLC Corporate Responsibility Report 2006
  13. 13. in the short term. However, through further investment in the network over the next two Speeding up the mortgage years, we expect our ATM numbers to process Once complete, these return to pre-integration levels. improvements will make all of our In 2006 we asked a panel of 100 Customer satisfaction customers about their experiences of our branches available to all of our mortgage application process. Their input In last year’s report we talked about the customers, who will see familiar fact that we needed to improve the levels helped us decide to bring the business faces serving them in better of customer satisfaction in our UK retail back in-house, including its servicing arm. looking and better equipped business. Our overall strategic aim for Even though the volume of business is premises. the UK Retail Bank is to build the best growing rapidly, the feedback about the bank in the UK, and our aim is to do that new approach is positive, and the average through sustained focus on excellence time it takes to get from application to Deanna Oppenheimer Chief Executive Officer, UK Retail Banking in customer service. offer is down by 32%. A great deal of effort has gone into this in the last 12 months: we have invested in modernising our branches, and we have sharpened up our internal processes. Our customer satisfaction scores are now Barclays Capital and Barclays Global We expect no frontline job losses as a result. improving, and the number of customers Investors. Likewise the operations in Africa However, three back offices are expected to who would recommend Barclays has also and the Indian Ocean are well ahead of their close. Our union, Amicus, has been advised gone up by 10% since the end of 2004. competitors, and Absa is ranked joint first in on the plans and employees informed of South Africa. We have succeeded in reducing queuing the potential future impact. These offices times in our branches this year – the Absa was rated the most caring company have a combined workforce of 1,200 but, average is now under three minutes, in the financial sector in the South African through employee turnover and taking compared with a high of 4.5 minutes Corporate Care Check survey. It was also steps to redeploy where possible, we are in 2004. third amongst all South African companies. working towards ensuring redundancies are significantly fewer than this. Overall, the We have always had a strong reputation Barclays Spain was ranked third in workforce of UK Retail Banking is expected for customer service in Spain and Portugal, the country for customer service in a to remain broadly in line with the current in UK Business Banking, Barclays Wealth, recent survey. number of 32,000. We continue our commitment to remaining in any town Safer banking where we are the last bank branch. UK branches reduced queuing time (minutes) The confidentiality and security of our data As for cash machines, we have the third- and transactions is one of our highest largest ATM estate in the UK, and our priorities, and we know that customers are customers also have access to some 34,500 increasingly concerned about this topic. 2006 free LINK cash machines. All of our ATMs Throughout the world we work closely with are free to use both for our customers and all the relevant authorities to ensure that our competitors’ customers, as our signage we play our full part in the fight against at these machines makes clear. And 92% financial crime and terrorism. of our machines are at a height that suits 2004 We know that our customers value the wheelchair users, a figure expected to freedom and convenience of online reach 98% by the end of 2007. As Barclays banking: in Spain, 54% of our customers and Woolwich fully integrate, there will be now use internet banking, and that some decrease in the number of our ATMs 0 1 2 3 4 5 number is rising annually by 25%; in South Free LINK cash machines Percentage of our cash machines that are Post Offices where our current account at a height that suits wheelchair users customers can withdraw cash free of charge 34,500 92 % 12,000 Barclays PLC Corporate Responsibility Report 2006 11
  14. 14. Responsible banking Our customers Africa the growth rate is more like 90%. We guarantee to refund any UK customer However, the flexibility of internet banking who has innocently suffered internet Dealing with money laundering can come at a price. There are a number of fraud on their Barclays account. There is Our anti-money laundering policies are possible security concerns here, including more information about this at designed to make sure that we observe ‘trojan’ viruses and ‘phishing’ (scam email www.barclays.co.uk/security. the highest ethical standards. They cover attacks). In response to this we are making issues such as training and accreditation All Barclays cash machines are protected free anti-virus software available to for our employees, and the use of IT with ‘anti-skimming’ devices, which ensure customers in the UK, Spain and South systems to monitor and report on that customers’ card details cannot be Africa, and we update our online security anything that appears suspicious. Barclays stolen by fraudsters. Our ATM cards are pages on a regular basis. Wealth has reviewed its processes to protected by Integrated Chip and PIN We have also introduced a free SMS text technology and over one million customers ensure that they meet the strictest alert service in the UK and Spain, which are now using Barclaycard Secure, a process requirements of international compliance sends our online banking customers an which gives them better security when they and control, especially given the volume alert when they set up a new third-party are shopping online. of cross-border activity undertaken. payment, to check its authenticity. The next step will be the introduction of ‘two factor There is more detail about our authentication’– in other words Chip and customers on the website at PIN technology combined with a hand-held www.barclays.com/ourcustomers. card reader. Our goals, progress and commitments for 2007 can be found on page 6. 12 Barclays PLC Corporate Responsibility Report 2006
  15. 15. Responsible lending Understanding the issue With UK consumer debt now standing at a record £1.3 trillion, the subject of responsible lending has understandably received a good deal of press coverage. But media reports have not always given an accurate picture of the wider context. We have dedicated considerable time and resources to dealing with this issue, but before we talk about what we are doing, here are some basic facts and figures about consumer lending in the UK. Lending in context Of the remaining £213 billion, a large As one of the leading credit card companies For several years now levels of consumer proportion is structured debt, in other words in Europe, Barclaycard clearly has a debt have been rising, but there are positive lending with a fixed repayment schedule. responsibility to listen to these criticisms as well as negative aspects to this. Consumer And of the remainder, credit card borrowing and take the lead in doing something borrowing has not only supported the accounts for £55 billion, and most of that is about them. We talk later in this section country’s economic prosperity, with growth either being repaid in full every month, or about the specific work we have in hand, fuelled by retail spending but, in general, being managed without problem. but the main point is that we are committed more flexible access to credit has also been to both fairness and transparency in lending Even though credit card borrowing only good for the individuals concerned. At the and, as the market continues to develop in accounts for a very small proportion of the same time, interest rates have been at response to customer demand, we will do total, the wide choice of products available historically low levels, and seem likely to more to look at the deeper causes of and level of marketing means that public remain relatively low. So while debt has risen excessive borrowing. attention tends to focus on this particular considerably, the majority of people are product whenever the issue of consumer Given the increasing complexity and variety managing that debt without difficulty. debt arises. Critics have said that the terms of lending products available in the market, It is also important to look behind the and interest rates that apply to cards are not we have put greater focus on ensuring that headline figures. As the diagram shows, clear enough, and that the industry as a our marketing practices are responsible and of the total £1.3 trillion that has attracted whole has encouraged people to borrow transparent. It is our responsibility to ensure so much attention, £1.08 trillion is more – and take out more cards – than they that our products and their terms are clear secured debt, most of it mortgages. can afford. to customers. Nevertheless there will always be some individuals who will get into Total consumer debt in 2006 difficulties with their borrowings, however strictly the banking sector is regulated – or regulates itself. Secured lending Total unsecured lending Regardless of how low this figure is, it is £1.08trn £213bn important to address the issue and at Barclays there are two fundamental aims: 84% 16% first, to ensure that the number of people in difficulty, or at risk of becoming so, is as of which, low as possible and, secondly, to provide credit card lending, support and guidance to those in difficulty, £55bn or to those who need our help. 4% Preventative measures There are two aspects to our work on this. Within Barclays we are making better decisions about how much we lend, and to whom, partly by sharing data with other Source: Bank of England lenders. And in parallel with this we are Barclays PLC Corporate Responsibility Report 2006 13
  16. 16. Responsible banking Responsible lending encouraging customers to take more to highlight the potential value of having control and responsibility for their own access to other data sources, such as finances by developing better products, student loans, council tax payments, providing better and clearer information, and utility bills. and supporting financial capability And following extensive work across the initiatives. banking industry, in 2007 we are also in a position to share positive data, such as Data sharing limits and balances on current accounts. We talked in last year’s report about the This gives us access to additional benefits of data sharing for the industry as information which will help us to make a whole, and more progress has been made the best possible credit decisions. in the last 12 months. We fully understand the sensitivities The agreement we pioneered with other surrounding the disclosure of personal data lenders to share behavioural data is now and we want to be sure that it is secure and supported by the majority of the other big only used in responsible and appropriate credit card issuers. Barclaycard was the first ways. To achieve this, we continue to play a New services UK issuer to share data – such as a series of leading role in the industry-level work to minimum payments across multiple cards After text messages were sent to identify ongoing improvements to the UK’s or extensive cash advances – which can customers in May, 15,000 regular late- data sharing governance model. help us spot customers’ problems in the payers set up a direct debit. early stages. We expect other issuers to be We seek to improve lending practices to in a similar position over the course of 2007. keep pace with the market as it develops. Around 350 million accounts are already For some time we have maintained a ‘low For example, our Flexi-Rate card offers part of this scheme. A key objective for and grow’ approach whereby customers a lower APR to those who repay more of 2007 will be to start identifying sudden new to credit are given low credit limits. their balance each month. And we have and extreme changes in customers’ We will only increase this limit once they seen that Flexi-Rate customers are half circumstances, which look very different have shown that they are able to manage as likely, compared with other customers, in behavioural terms from a gradually their finances in a responsible fashion, consistently to repay only the minimum increasing problem. for example, by consistently meeting their amount. monthly commitment. We have also The behavioural data sharing project is one Alongside new products we have introduced other measures, such as of a number of data sharing initiatives in introduced additional services to give reduced credit limits, to help ensure that our which Barclays is playing a leading role. customers more control. For example, to customers do not over-commit themselves. Other opportunities include working with help people repay on time we can send text Callcredit (a UK credit reference agency) alerts to customers five days before their More appropriate products on an ‘over-indebtedness initiative’ which monthly repayment date, and put more One way to encourage responsible allows us to test the value of sharing certain personalised messages on their statements. card ownership is to develop products information relating to a customer’s These help people who often pay late or that reward customers who manage income, and working with Government only pay the minimum, by giving a useful their debt sensibly. Initiative Data shared Purpose Who is involved? Historic (‘Non- This is data from customers who signed To allow the inclusion of data A cross-industry effort, where Consensual’) agreements before Data Protection sharing for ‘long-standing’ customers, numerous responses to a DTI-led data sharing notification clauses allowed the sharing of helping to address the ‘gaps’ in credit files consultation were submitted in positive data January 2007 Behavioural Additional data to be shared for credit To increase our ability to identify sudden Barclays is playing a lead role on this data sharing cards, for example, payment amounts, and severe changes in customer project under the auspices of APACS, credit limit changes and cash advance circumstances the UK trade association for payments, activity with a majority of issuers now engaged Callcredit Over – Current account turnover and income To provide data about income and Being piloted by Barclays and four indebtedness declared on loan applications debt levels other banks initiative Data sharing A detailed review of the governance To ensure that processes remain effective Led by the British Bankers’ Association governance processes surrounding data sharing and managed through a cross-trade association stakeholder group 14 Barclays PLC Corporate Responsibility Report 2006

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