ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED

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ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
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ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
Contents
                                                                                                                            About this
                                                                                                                            Report
                                              SUSTAINABILITY                   03   STATEMENT FROM      04

                                              AT A GLANCE                           GROUP CHIEF EXECUTIVE                   Doing
                                                                                                                            Business in the
                                                                                                                            right way
                                                                                    AND PRESIDENT                           THE RIGHT
                                                                                                                            PEOPLE

                                                                                                                            Contributing to

     SECTION 1                           06   SECTION 2                        14   SECTION 3                          24
                                                                                                                            our communities

     About this                               Doing business The right                                                      operating
                                                                                                                            responsibly

     report                                   in the right way people                                                       FEEDBACK

     WHO WE ARE	                         07   Effective risk management        16   Developing our leaders             26   GRI and HKEx
                                                                                                                            guide content
     OUR APPROACH TO ESG	                10   Responsible business practices   17   Fostering a culture                     Index

     OUR APPROACH TO ESG REPORTING	      12   Securing customer information    20   of people development              27

                                              Customer engagement              23   Culture and engaging our people    29
                                                                                    Diversity and inclusion            30
                                                                                    recognising and rewarding
                                                                                    our people                         32
                                                                                    employee health, wellness
                                                                                    and safety                         32
                                                                                    embracing digital transformation   34

     SECTION 4                           35   SECTION 5                        50   SECTION 6                          59

     Contributing to Operating                                                      FEEDBACK
     our communities responsibly
     Our products                        36   Energy and emissions             51   SECTION 7                          61

     Continued innovation                44   Resource usage                   56   Global
     Sustainable investment              45   Sustainable infrastructure       57
                                                                                    reporting
     Corporate social responsibility
     and community wellness              47
                                              Our green buildings              58
                                                                                    initiative and
                                                                                    hong kong
                                                                                    stock exchange
                                                                                    Guide Content
                                                                                    Index

02     ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
2018
     SUSTAINABILITY
                                                                                                                                                       About this
                                                                                                                                                       Report

     AT A GLANCE                                                                                                                                       Doing
                                                                                                                                                       Business in the
                                                                                                                                                       right way

                                                                                                                                                       THE RIGHT
                                                                                                                                                       PEOPLE

               Protection                                                            GREEN BUILDINGS
                                                                                                                                                       Contributing to
                                                                                                                                                       our communities
     Serve the holders of more than                                        Two AIA Financial Centre in Nanhai, Foshan, China

     33 million
                                                                           achieves the highest rating of LEED Platinum certification
                                                                                                                                                       operating
                                                                                                                                                       responsibly
                                  individual policies and over

     16 million                   participating members of
                                  group insurance schemes
                                                                                                                                                       FEEDBACK

                                                                                                                                                       GRI and HKEx
                                                                                                                                                       guide content
              Investments in                                                                                                                           Index

              Infrastructure                                              Key ESG                                    Key ESG
     As at 31 December 2018,                                              Ratings                                    Index Inclusions

     US$ 24 BILLION
                                                                 Awarded an
                                                                 ISS-oekom
                                                                 Prime Rating

     invested in infrastructure-related sectors such
     as electricity, transportation and telecommunications

              ENERGY                                                      Environmental                               Corporate
              Performance                                                 Performance                                 Governance
                                                                 Total carbon emissions of                  AIA Group Ltd Board and Committees
     4,117 kWh per employee                                                                                 composed almost entirely of
                                                                                                            independent non-executive directors

              Total energy use amounted to                           55,761
                                                                         tonnes
             8 6 5 9 3 0 5 7
                        kWh

                                                                 2.7 tonnes per AIA employee

              Investments in Healthcare                                   Community Care                              ESG Signatories
                                                                 Over                                       AIA is the first Hong Kong headquartered

     US$ 2.4 BILLION                                             US$ 5 MILLION
                                                                                                            Asset Owner to join the Principles
                                                                                                            for Responsible Investment

     invested in the healthcare sector                           contributed to our communities

03     ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
STATEMENT FROM                                                                   About this
                                                                                                                             Report

                                            GROUP CHIEF EXECUTIVE                                                            Doing
                                                                                                                             Business in the
                                                                                                                             right way

                                            AND PRESIDENT                                                                    THE RIGHT
                                                                                                                             PEOPLE

                                                                                                                             Contributing to
                                                                                                                             our communities
                                            I am delighted to present the            programmes and financial support
                                            Company’s Environmental, Social          that are often not available at the     operating
                                            and Governance (“ESG”) Report            required scale. All of these factors    responsibly
                                            2018. At AIA we believe that             mean that our communities are faced
                                            insurance is intrinsically linked        with a growing “protection gap” – the   FEEDBACK
                                            with the economic and social well-       shortfall in insurance and savings
                                            being of our communities and it          required to protect against health
                                                                                                                             GRI and HKEx
                                            is imperative that we continue to        and mortality risk.                     guide content
                                            act with integrity while innovating                                              Index
                                            solutions that help address              This year we launched our new
                                            challenges across the region. Our        purpose-led brand promise –
                                            sustainable future is based both         “Healthier, Longer, Better Lives” –
                                            on our ability to deliver real value     which reflects what we stand for as a
                                            to our customers and shareholders        company. As the largest independent
                                            while also making a meaningful           publicly listed pan-Asian life
                                            contribution to the communities that     insurance group, we see it as our
                                            we serve.                                mission to help address the health
                                                                                     and wellness challenges faced by
                                            Rapid economic development has           our communities. Our products
                                            brought tremendous improvements          provide a safety net to millions and
                                            in standards of living in Asia.          we continue to raise awareness
                                            Nevertheless, the significant            about the importance of making
                                            progress made has not been without       healthy choices to manage risks
                                            its challenges. Growing affluence in     associated with disease, particularly
                                            the region has been accompanied          through our flagship AIA Vitality
                                            by an increasing prevalence of           wellness programme.
                                            lifestyle-related diseases. Industrial
                                            growth has resulted in higher levels
                                            of pollution. Advances in healthcare
                                            also mean that people are living
                                            longer, but ageing populations
                                            require levels of social welfare

04   ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
About this
                                                                                                                              Report

                                                                                                                              Doing
                                                                                                                              Business in the
                                                                                                                              right way

                                                                                                                              THE RIGHT
                                                                                                                              PEOPLE

                                                                                                                              Contributing to
                                                                                                                              our communities

                                                                                                                              operating
                                                                                                                              responsibly

                                                                                                                              FEEDBACK

                                                                                                                              GRI and HKEx
                                                                                                                              guide content
                                                                                                                              Index

     This ESG Report has been structured      of climate change impacts. AIA           once again as a gender-inclusive
     to demonstrate how we manage             also became the first Hong Kong-         company through our inclusion in the
     our impact and address priority          headquartered asset owner to join the    Bloomberg Gender Equality Index.
     sustainability issues. We have           Principles for Responsible Investment
     mapped our disclosure against the        (PRI), a testament to our commitment     In 2019, our Centennial year, AIA
     United Nation’s 17 Sustainable           to sustainable investment across our     looks forward to continuing to
     Development Goals, aligning our          markets.                                 play a vital role in creating a more
     strategic commitments with these                                                  sustainable tomorrow as we help
     global objectives and the Principles     I am proud of the significant progress   the people we serve live Healthier,
     of the UN Global Compact.                we have made in our journey toward       Longer, Better Lives.
                                              building a sustainable future. Our
     ESG issues are rightly top of mind       efforts in addressing material ESG
     for our stakeholders. As one of          issues and enhancing our disclosures
     Asia’s leading companies, AIA has        have earned commendations from
     an important role to play in driving     international research and rating
     positive change. This year AIA           agencies. In 2018 we received a
     supported the recommendations of         “Prime” rating from ISS – oekom,
     the Task Force on Climate Related        and have been included in the
     Financial Disclosures (TCFD), a global   FTSE4Good Index Series for a             Ng Keng Hooi
     initiative that seeks to generate        second consecutive year. We were         Group Chief Executive and President
     greater awareness and consideration      also pleased to be acknowledged          15 March 2019

05    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
SECTION 1

                                                        About this
                                                        Report

                                                        Doing
                                                        Business in the
                                                        right way

                                                        THE RIGHT
                                                        PEOPLE

                                                        Contributing to
                                                        our communities

     ABOUT
                                                        operating
                                                        responsibly

                                                        FEEDBACK

                                                        GRI and HKEx

     THIS
                                                        guide content
                                                        Index

     REPORT

06   ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
Total sum assured of over
     OUR VISION is to be the
     world’s pre-eminent life
     insurance provider.                                          US$1.58 trillion                           About this
                                                                                                             Report

                                                                  Serve the holders of more than

                                                                  33
                                                                                                             Doing
     OUR PURPOSE is to play                                                  MILLION INDIVIDUAL              Business in the
                                                                                                             right way

     a leadership role in driving                                            policies                        THE RIGHT
     economic and social development                                                                         PEOPLE

     across the region.                                           And over                                   Contributing to

                                                                  16
                                                                                                             our communities
                                                                             Million
                                                                             participating                   operating
                                                                                                             responsibly

                                                                             members of                      FEEDBACK
                                                                             group insurance
                                                                             schemes                         GRI and HKEx
                                                                                                             guide content
                                                                                                             Index

     WHO WE ARE
     The Company and its subsidiaries (collectively “AIA” or      AIA Group Limited (the “Company”) is
     the “Group”) comprise the largest independent publicly       pleased to present its ESG Report 2018
     listed pan-Asian life insurance group. AIA has a presence    (the “Report”), which sets out in detail
     in 18 markets in Asia-Pacific-wholly-owned, branches         our ESG priorities and the commitments
     and subsidiaries in Hong Kong, Thailand, Singapore,          we are making toward our promise of
     Malaysia, China, Korea, the Philippines, Australia,          enabling Healthier, Longer, Better Lives
     Indonesia, Taiwan, Vietnam, New Zealand, Macau, Brunei,      across the Asia Pacific region.
     Cambodia, a 97 per cent subsidiary in Sri Lanka, a 49 per
     cent joint venture in India and a representative office in   This Report describes how we address
     Myanmar.                                                     material sustainability issues and
                                                                  contains cross references to information
     With a total sum assured of US$1.58 trillion as of           in AIA’s Annual Report 2018.
     31 December 2018, AIA serves the holders of more
     than 33 million individual policies and over 16 million
     participating members of group insurance schemes.

07    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
About this
                                                                                                                                       Report

                                                                                                                                       Doing
                                                                                                                                       Business in the
                                                                                                                                       right way

                                                                                                                                       THE RIGHT
                                                                                                                                       PEOPLE

                                                                                                                                       Contributing to
                                                                                                                                       our communities

                                                                                                                                       operating
                                                                                                                                       responsibly

                                                                                                                                       FEEDBACK

     WHERE WE MAKE A DIFFERENCE                                                                                                        GRI and HKEx
                                                                                                                                       guide content
                                                                                                                                       Index

     Deteriorating health associated with                It is projected that more than
                                                                                                               ACROSS ASIA
                                                         25%
     lifestyle factors has resulted in an
     increase of non-communicable                                                                              PACIFIC, RAPID
     diseases (“NCDs”), which account for
                                                                                                               Economic growth
     71%
     of all deaths globally1.
                                                         of the population in Asia Pacific will
                                                         be over the age of 60 by 20502,
                                                         straining economic growth and
                                                         increasing demand for public services.
                                                                                                               has seen reductions
                                                                                                               in poverty and
                                                                                                               improvements in
     Air pollution contributes to the                    By 2050, urbanisation coupled with                    standards of living,
     premature deaths of about                           the overall growth of the world’s                     yet this has not been
                                                                                                               without its share
     7 million 2.5 billion
                                                         population could add

                                                                                                               of challenges.
     people globally each year3.
                                                         more people to urban areas4.

     The shortfall in resources to ensure protection against mortality
     in the region is estimated to reach

     US$ 73 trillion
     by 20205.

     These issues present our markets with
     significant social and economic risks.

     1
         WHO 2018
     2
         UN 2016
     3
         WHO 2018
     4
         UN 2014
     5
         Our forecast is based on the 2014 mortality protection gap data of Swiss Re’s 2015 Mortality Protection Gap Report.

08       ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
For 100 years, AIA has provided
     protection to individuals and
     families when they have needed
     it most. As a market leader, AIA                                                                                           About this
                                                                                                                                Report

     focuses on the sustainability
     of our financial results, But we                                                                                           Doing
                                                                                                                                Business in the
     also focus on helping to address                                                                                           right way

     the challenges faced by our                                                                                                THE RIGHT
                                                                                                                                PEOPLE
     markets. We believe that this
     focus on sustainability is integral                                                                                        Contributing to
                                                                                                                                our communities
     to our long-term growth and
     the sustainable and inclusive                                                                                              operating
                                                                                                                                responsibly
     development of our communities.
                                                                                                                                FEEDBACK

                                                                                                                                GRI and HKEx
                                                                                                                                guide content
                                                                                                                                Index

     Given the array of ESG challenges across             As the largest pan-Asian life insurer, we are well
     Asia, we have chosen to focus on those that          positioned to meet these challenges.
     allow us to have the greatest impact and drive
     meaningful change.                                   OTHER MATERIAL TOPICS

     AIA’s Environmental, Social and Governance           AIA maintains a continuous dialogue with our
     Committee (“ESG Committee”) oversees the             stakeholder groups and considers industry and
     development of ESG strategies and initiatives        ESG specific research. These perspectives are
     at the Company. The role of the ESG Committee        incorporated within our materiality assessment
     is discussed in detail in the ESG Governance         process and are subject to further feedback
     section of this Report.                              from our ESG Committee. Other material ESG
                                                          issues that impact our operations more broadly
     After consultation with various stakeholders,        are outlined in the table below and discussed in
     the ESG Committee identified the following           this Report.
     five issues that will be central to our efforts to
     operate in a sustainable way while supporting
     our communities:

     •	The growing protection gap
     •	Lifestyle related disease
     •	Ageing populations
     •	Urbanisation
     •	Pollution

         Workforce wellness             Recruitment & retention            Digitalisation                 Climate change

             Cybersecurity               Financial performance         Effective governance             Diversity & inclusion

            Data protection                 Staff development and training                  Responsible business practices

09     ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ENVIRONMENTAL, SOCIAL AND GOVERNANCE - REPORT 2018 STOCK CODE : 1299 - AIA GROUP LIMITED
OUR APPROACH TO ESG
                                                                                                                      About this
                                                                                                                      Report

     In 2018, we launched our new purpose-led brand
     promise to help our customers lead Healthier,                                                                    Doing
                                                                                                                      Business in the
     Longer, Better Lives. With this promise at our core,                                                             right way
     and our commitment to our Operating Philosophy
                                                                                                                      THE RIGHT
     of “Doing the Right Thing, in the Right Way, with                                                                PEOPLE
     the Right People… and the Right Results will come”,
     we devised the following ESG Approach.                                                                           Contributing to
                                                                                                                      our communities

                       Environment                       Social              Governance                               operating
                                                                                                                      responsibly

                                                                                                                      FEEDBACK
                       Sustainable                       Our                 The Right
                       Infrastructure                    Products            People
                                                                                                                      GRI and HKEx
                                                                                                                      guide content
                                                                                                                      Index
                       Resource                          Sustainable         responsible
                       Usage                             Investment          Business Practices

                       Energy &                          CSR & Community    Effective Risk
                       Emissions                         Wellness            Management

                       OPERATING                    CONTRIBUTING TO         DOING BUSINESS
                      RESPONSIBLY                   OUR COMMUNITIES         THE RIGHT WAY

     AIA’s brand promise speaks to why
     we do what we do as a company and                                           We have structured this Report
                                                                                 to communicate the policies,
     is central to all our ESG initiatives.                                      initiatives and practices relevant
     We aim to address the sustainability                                        to addressing material ESG
     challenges faced across our markets,                                        issues. Our Approach provides
     to operate responsibly by mitigating                                        a framework for the continued
     our environmental impact, and to                                            communication of our ESG
                                                                                 progress and the delivery of our
     ensure that we always do business                                           brand promise. Please click on
     in the right way by adhering to the                                         a topic to be redirected to the
     highest ethical standards.                                                  relevant section.

10    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
THE ROLE OF HEALTH                                   OUR
     AND LIFE INSURANCE                                   PROMISE                                                About this
                                                                                                                 Report

                                                                                                                 Doing
     The insurance industry plays a                       At AIA we’re making this commitment to people          Business in the
                                                                                                                 right way
                                                          all across Asia Pacific, and in every community
     broad role in contributing to the                    where we live and work. We’re not going to focus       THE RIGHT
     social and economic fabric of the                    on sickness; we’re going to focus on health.           PEOPLE

     communities where we operate.                        We’re not going to focus just on life; we’re going
                                                          to focus on living. We believe the best way to live    Contributing to
     This is not always evident given                     well is to be healthier.                               our communities

     the intangible nature of our
                                                                                                                 operating
     products and services.                               Because when you’re healthier you get more out         responsibly
                                                          of life. You can do more. Experience more. Live
     The concept of pooling and sharing risk to           life to its fullest. Why longer? Because when          FEEDBACK
     provide businesses and people with security          you’re healthy, you can enjoy an active and
     has been around for centuries. Life and              meaningful life, for longer. And better. Because
     health insurance products provide individuals        it’s not just about staying alive, it’s about living   GRI and HKEx
                                                                                                                 guide content
     with peace of mind knowing that they, their          well. And that’s where we can really make a            Index
     employees, and their loved ones are protected        difference; with products and policies that don’t
     against life’s uncertainties.                        just protect lives but help make lives healthier,
                                                          longer and better. Every single day.
     The industry is also a valuable enabler of Asia’s
     growth. Rapid urbanisation and economic
     development in the region have brought
     affluence, but disrupted the traditional family      “At AIA we’re making a
     networks people have historically relied upon         purpose-led promise. It’s a
     for security and support. This societal shift has     promise that is at the heart
     exacerbated shortfalls in protection cover. Health
     insurance and savings options help to address         of everything we do and
     these protection gaps and reduce the burden           everything that drives the
     on families and on national healthcare systems,
     while providing people with a wider range of
                                                           decisions we make: it’s a
     options in accessing medical treatment.               promise to help people live
                                                           healthier, longer, better lives.”
     Insurance also helps to mobilise investment,
     with the premiums paid from policies reinvested
     across productive sectors and businesses in
     Asia. This supports the growth and development
     of capital markets and provides valuable capital
     for infrastructure, economic growth and thereby
     the development of our region.

11    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
OUR APPROACH TO ESG REPORTING
                                                                                                                                           About this
     AIA has a responsibility to be                          To provide a comprehensive review                                             Report
     transparent and accountable to all                      of our impact and performance,
     of our stakeholders. This includes                      this Report includes, unless                                                  Doing
     reporting on how we make a                              otherwise indicated, ESG data                                                 Business in the
                                                                                                                                           right way
     difference in our communities,                          from our operations in Hong Kong,
     addressing sustainability challenges                    Thailand, Singapore, Malaysia, China,                                         THE RIGHT
                                                                                                                                           PEOPLE
     and making a lasting and meaningful                     Korea, the Philippines, Australia,
     impact within our markets. Our key                      Indonesia, Taiwan, Vietnam, New
                                                                                                                                           Contributing to
     stakeholders include our investors,                     Zealand6, Macau, Brunei, Cambodia                                             our communities
     customers, regulators, business                         and Sri Lanka (collectively, the
     partners and our employees and                          “business units”)7.                                                           operating
     agents.                                                                                                                               responsibly
                                                             For easy reference to our reporting
     This Report is produced in                              disclosures, the GRI Index, the UN                                            FEEDBACK
     accordance with the “Core” option                       Global Compact, and the HKEx
     of the Global Reporting Initiative                      ESG content index are provided at
                                                                                                                                           GRI and HKEx
     (“GRI”) Standards and Financial                         the end of this Report. Additional                                            guide content
     Services Sector Supplement, with                        information relevant to our ESG                                               Index
     reference to the ESG Reporting Guide                    performance, including financial
     set out in Appendix 27 of the Rules                     data and corporate governance
     Governing the Listing of Securities                     matters, can be found in our Annual
     on The Stock Exchange of Hong Kong                      Report 2018. AIA makes every effort
     Limited (HKEx). As a signatory to                       to ensure consistency between the
     the United Nations Global Compact                       Chinese and English versions of this
     (the “UN Global Compact”), AIA also                     Report. However, in the event of any
     reports on our progress toward the                      inconsistency, the English version
     UN Global Compact Ten Principles.                       shall prevail.

     This year we have also added a                          This Report was reviewed and
     personal element to our Report by                       approved by the Company’s Board
     including stories from our customers,                   of directors (the “Board”) on
     agents, and employees – the people                      14 March 2019.
     who bring our story to life.

     6	
         In July 2018 AIA completed the acquisition of ASB Group (Life) Limited (renamed as AIA Sovereign Limited) and its subsidiaries,
         including Sovereign Assurance Company Limited, a licensed insurer in New Zealand (together, “Sovereign”). Unless otherwise
         noted, we have included ESG data from Sovereign in this Report for the first time.
     7
         Refers to all business units where AIA maintains majority operational control.

12       ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
About this
                                                         Report

                                                         Doing
                                                         Business in the
                                                         right way

                                                         THE RIGHT
                                                         PEOPLE

                                                         Contributing to
                                                         our communities

                                                         operating
                                                         responsibly

                                                         FEEDBACK

                                                         GRI and HKEx
                                                         guide content
                                                         Index

     THE SUSTAINABLE
     DEVELOPMENT GOALS
     Developed by the United Nations (“UN”), the
     Sustainable Development Goals (“SDGs”)
     are 17 overarching goals that provide a
     global framework for peace and prosperity in
     consideration of the environment. Adopted in
     2015 by all member states of the UN, they are
     strategically important to governments across
     Asia Pacific.

     As a life and health insurer, our business
     naturally aligns with several SDGs. In AIA’s
     ESG Report 2017, we mapped our progress
     toward the goals using the SDG Compass, a
     tool designed for businesses to outline their
     contributions to the SDGs. In response to the
     positive feedback we received, this Report
     continues to outline our support for related
     SDGs and, for the first time, includes SDG
     targets that align with our disclosure.

           Please click on the SDG icons above to
           be redirected to discussions on each goal.

13    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
SECTION 2

                                                        About this
                                                        Report

                                                        Doing
                                                        Business in the

     DOING
                                                        right way

                                                        THE RIGHT
                                                        PEOPLE

                                                        Contributing to
                                                        our communities

     BUSINESS
                                                        operating
                                                        responsibly

                                                        FEEDBACK

                                                        GRI and HKEx

     IN THE
                                                        guide content
                                                        Index

     RIGHT WAY

14   ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
ESG GOVERNANCE
                                                              ESG issues have potential to impact business        About this
                                                                                                                  Report
                                                              performance, whether through regulation,
                                                              stakeholder perception, or by directly affecting
                                                                                                                  Doing
                                                              the health and well-being of our customers.         Business in the
                                                                                                                  right way

                                                              AIA seeks to understand these ESG issues,           THE RIGHT
                                                              mitigate our impact on the environment, and         PEOPLE
                                                              address the key health challenges facing our
                                                              markets. This is core to who we are and how         Contributing to
                                                                                                                  our communities
                                                              we operate.

                                                                                                                  operating
                                                              All employees at AIA are responsible for            responsibly
                                                              contributing to the realisation of our ESG
                                                              priorities, whether through upholding our           FEEDBACK
                                                              principles for good governance or through
                                                              an ESG focused role.
                                                                                                                  GRI and HKEx
                                                                                                                  guide content
                                                              In 2018, to provide effective governance for        Index

     DOING BUSINESS in                                        integrating and addressing ESG issues within
                                                              our business, we formed an ESG Committee,

     THE RIGHT WAY                                            comprised of members of the Group Executive
                                                              Committee.

                                                              The Committee meets on at least a quarterly
     Strong corporate governance sets the                     basis and plays an integral role in overseeing
                                                              the Company’s ESG strategy, policies and
     foundation from which we are able to                     disclosure, including reporting to the Board
     grow our business, realise our Purpose,                  on a biannual basis. The Committee also
     and make a positive difference in                        considers ESG research, feedback raised by
                                                              key stakeholders and reports by rating
     people’s lives.                                          agencies, and provides input on material ESG
                                                              issues relevant to the Group.
     Our approach is based on the Group’s Operating
     Philosophy of “Doing the Right Thing, in the Right       In 2018, the Committee approved AIA’s
     Way, with the Right People... the Right Results will     membership in the PRI and TCFD.
     come.” This approach applies across all our operations
     and is embedded within our governance practices
     and culture programmes.

     “Doing the Right
     Thing, in the
     Right Way, with
     the Right People...
     the Right Results
     will come                ”                                     For further details on our leadership team,
                                                                    please click here.

15    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
About this
                                                                                                                              Report

     Effective Risk                                                                                                           Doing
                                                                                                                              Business in the

     Management
                                                                                                                              right way

                                                                                                                              THE RIGHT
                                                                                                                              PEOPLE

                                                                                                                              Contributing to
                                                                                                                              our communities
     Investors increasingly consider ESG        may have immediate operational
     risks in making their investment           impacts and are therefore treated       Risk Culture                          operating
     decisions, with research showing           as operational risks. Long-term                                               responsibly
     that companies with better                 challenges such as pollution and        A key element in the effective
     capacity to manage ESG-related             lifestyle risk factors impact the       management of risk, including         FEEDBACK
     risks produce higher returns               health and well-being of people         ESG risk, is a strong risk culture.
     over the long term8. At AIA, a             across our markets, and are viewed
     comprehensive approach to risk             as insurance risks given the impact     Risk culture refers to how an         GRI and HKEx
                                                                                                                              guide content
     management ensures that we have            they may pose. Such emerging ESG        organisation behaves as it            Index
     the frameworks in place across our         issues may be discussed by the          encounters opportunity and
     business to address relevant risks.        BRC, eRC or the ESG Committee.          manages risk. Strong risk
                                                                                        awareness, as a part of AIA’s
     The Board retains ultimate                 AIA conducts scenario testing           desired broader culture, is
     responsibility for the oversight           and business continuity analysis        integral to our RMF. Our Vision
     of the Group’s risk management             to ensure sufficient capital is         and Purpose are aligned with
     activities and monitors material           earmarked to provide protection         a strong and sustainable risk
     Group-wide risks, whether they are         to our policyholders and to ensure      culture.
     relevant to the industry or unique to      business continuity under stressed
     the Group and its businesses. The          conditions. For further details,        AIA’s Operating Philosophy, Code
     Board is supported by the Board Risk       please refer to page 155 of the         of Conduct (the “Code”) and
     Committee (“BRC”) and executive            Annual Report 2018.                     brand promise further outline
     risk committees (“eRC”), such as                                                   expectations on professional
     the Operational Risk Committee and         Our internal audit team provides        conduct, risk behaviours, and
     Financial Risk Committee, which are        independent assurance on the            channels of recourse and
     comprised of our senior executives.        effectiveness of our key controls       reporting on potential risks.
                                                and recommends control                  Frequent training and internal
     AIA’s Risk Management Framework            improvements as necessary. The          communications ensure that
     (“RMF”) ensures that across our            team’s efforts cover a number of        all employees and agents are
     Group, we have the capabilities            current and emerging ESG risk           familiar with reporting relevant
     and processes in place to identify,        areas, such as people management,       risk issues.
     quantify, monitor and report risk.         technology and data privacy,
     The Board and business unit                to provide assurance that the
     boards of directors are responsible        appropriate controls are in place     organisations, and by playing a
     for reviewing this framework to            to address these risks.               proactive role through our business
     ensure that it is sufficiently effective                                         where we remain committed to
     given local business environments          AIA recognises that long-term         enabling Healthier, Longer, Better
     and context.                               ESG risks, such as climate change,    Lives across the region.
                                                pollution and life-style related
     We address ESG related risks               disease, have far reaching impacts
     according to the process outlined          on our markets and require
     in the RMF and categorise them             concerted contributions from
     based on the nature of the risk to         business, government and the
     our operations. Data protection,           general public alike. AIA aims
     cybersecurity, people management           to address these issues through
     and responsible business practices         discussion within our ESG member

      MSCI 2015
     8	

16     ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
Responsible Business Practices
     Our customers place                     CODE OF CONDUCT
                                                                                                                                About this
                                                                                                                                Report

     a high degree of                        At the heart of our approach to good    supplemented with an ethical
     trust in our business,                  governance is the AIA Code. The Code    leadership programme in business,
                                                                                                                                Doing
                                                                                                                                Business in the
     and in our ability to                   provides clear guidance on how we       which equips AIA’s leaders with
                                                                                                                                right way

     provide protection                      conduct business at all times and       practical tools in managing situations     THE RIGHT
                                                                                                                                PEOPLE
                                             applies to everyone who works at AIA.   involving ethical dilemmas.
     and financial security                  It reflects our Operating Philosophy
     to millions across the                  of “Doing the Right Thing, in the       Each employee is expected to take          Contributing to
                                                                                                                                our communities
     region. We take pride                   Right Way, with the Right People…       personal responsibility for observing
                                             the Right Results will come.” It also   the highest standards of integrity
     in our reputation of                    defines how we hold ourselves to the    and conduct, and to report any
                                                                                                                                operating
                                                                                                                                responsibly
     being a reliable and                    highest standards of professionalism,   violations without fear or hesitation.
     trustworthy brand,                      which is key to maintaining trust and   Non-compliance with the Code is            FEEDBACK
                                             building sustainable relationships      subject to disciplinary action, which
     and continue to act                     with our stakeholders – customers,      may include dismissal. AIA’s business
     with integrity                          agents, distribution partners and       partners, including its agents,            GRI and HKEx
                                                                                                                                guide content
     throughout our                          shareholders.                           suppliers, distribution partners and
                                                                                     others who act on behalf of AIA, are
                                                                                                                                Index

     operations.                             The Code has been translated into       expected to apply the same standards
                                             six languages across the Group’s        and to follow the same responsible
                                             markets and employees are required      practices as our employees.
                                             to undertake training to familiarise
                                             themselves with the Code on joining
                                             AIA. All employees are required to
                                             complete an annual certification
                                                                                           For further details, we invite you
                                             of understanding and compliance.              to read our Code linked here.
                                             Training on the Code is

17    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
PREVENTING BRIBERY                      PREVENTING                             About this
     AND CORRUPTION                          FRAUD                                  Report

     AIA has zero-tolerance for              AIA is committed to the high           Doing
                                                                                    Business in the
     corruption. Under our policies,         ethical standards outlined in          right way
     employees and other persons             the Code and espouses a zero-
                                                                                    THE RIGHT
     representing AIA are prohibited         tolerance approach towards fraud.      PEOPLE
     from offering, accepting, paying        AIA’s Anti-Fraud Policy sets out
     or authorising any bribes or any        standards for managing the risk of     Contributing to
     form of corruption in any business      fraud, including training as well as   our communities
     interaction that involves AIA           preventive and detective measures.
     and government officials, our           Our operating entities implement       operating
                                                                                    responsibly
     customers, or employees.                procedures to prevent and facilitate
                                             early detection of fraudulent
                                                                                    FEEDBACK
     Our Group-wide Anti-Corruption          practices to protect customer
     Policy (the “Policy”) sets a high       interests and those of AIA, in line
     standard that is observed across        with this policy.                      GRI and HKEx
     our operations. Anti-corruption                                                guide content
                                                                                    Index
     training is compulsory for              Incidents and allegations or
     all employees. Reviews and              suspicions of fraud are assessed
     assessments are conducted               and investigated. If allegations
     from time to time to monitor            or suspicions are substantiated,
     compliance with the Policy. The         AIA is committed to taking a fair
     Policy also outlines the roles and      and proportionate approach in
     responsibilities of employees           administering disciplinary actions.
     to ensure compliance. Our               Other actions may include the
     business units are responsible          loss of employment-related
     for implementing processes and          benefits, reporting the fraud to
     controls to reduce the risk of          law enforcement authorities for
     corruption and ensure compliance        prosecution or seeking a legal
     with Group standards, as well as all    remedy against the employee for
     relevant local laws and regulations.    the fraud that has been committed.

18    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
OUR APPROACH TO ANTI-MONEY                     About this
                                                                                                              LAUNDERING (“AML”) AND COUNTER                 Report

                                                                                                              TERRORIST FINANCING (“CTF”) AND
                                                                                                              SANCTIONS                                      Doing
                                                                                                                                                             Business in the
                                                                                                                                                             right way
                                                                                                              AIA is committed to a strict
                                                                                                                                                             THE RIGHT
                                                                                                              programme of compliance with                   PEOPLE
                                                                                                              all applicable AML/CTF laws and
     WHISTLE-BLOWER POLICY                                                                                    regulations to prevent the use of its          Contributing to
                                                                                                              products and services for money                our communities

     AIA provides channels for all of our                  All allegations are assessed                       laundering and terrorist financing
     stakeholders, including employees,                    and investigated. Reporting                        purposes.                                      operating
                                                                                                                                                             responsibly
     customers, and suppliers, to raise                    through internal channels (such
     concerns about any violation of                       as Human Resources, Audit and                      The AIA Group AML/CTF Policy
                                                                                                                                                             FEEDBACK
     the Code or other behaviour that                      Compliance) accounted for 76                       and Guidelines set out the detailed
     falls short of the high standards                     per cent of the reports received                   requirements of the Group AML/
     demanded by the Group.                                during the year. Issues raised via                 CTF Programme. This programme                  GRI and HKEx
                                                           the ethics hotline are handled by                  includes a risk based approach                 guide content
                                                                                                                                                             Index
     To that end AIA maintains a                           AIA’s Group Compliance team.                       to conducting customer due
     comprehensive Whistle-blower                          The Whistle-blower programme                       diligence, ongoing monitoring,
     Programme designed to handle                          is overseen by the Board Audit                     suspicious activity reporting,
     reports of misconduct and                             Committee, who receive regular                     training and record keeping. AIA
     inappropriate behaviour with multiple                 reports from Group Internal Audit                  uses a comprehensive AML/CTF
     reporting channels, including a                       and Group Compliance on the                        monitoring software or online tool
     24-hour, multi-lingual third-party                    number and nature of issues                        to screen, risk profile and monitor
     administered compliance hotline                       raised and the progress of all                     customer activity.
     which permits complete anonymity.                     material investigations. AIA’s
                                                           Whistle-blower Protection Policy                   All new employees are required to
                                                           prohibits any form of retaliation                  complete AML and CTF training.
               Further details on our ethical              against any employee providing                     Tied agents also are required
               compliance hotline can be                   a good faith report of an actual or                to receive appropriate AML/
               found here.                                                                                    CTF training. In addition, our
                                                           suspected violation of the Code.
                                                                                                              AIA Group Economic Sanctions
                                                                                                              Compliance Policy & Guidelines
         Proportion of reports received in 2018 by reporting channel9                                         set out standards to manage the
                                                                                                              risk of dealings with governments,
                                                                                                              individuals and entities subject to
                                                                                                              sanctions programmes.

                                         24%

                            2018
                                                                         External Hotline

                                76%                                      Internal ChannelS

            Reporting through internal channels accounted for
            76% of the reports received during the year

     9
         Proportion of reports received by reporting channel remains the same for both the twelve-month and thirteen-month periods ended 31 December 2018.

19       ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
Securing customer information
                                                                                             About this
     DATA PROTECTION                                                                         Report

     Among our most important assets is          Appropriate data protection controls        Doing
                                                                                             Business in the
     the trust placed in AIA to handle the       are also integrated into relevant           right way
     personal information of our customers,      operational processes and are regularly
                                                                                             THE RIGHT
     employees and business partners. AIA        tested by our internal audit team. For      PEOPLE
     has in place Group-wide Data Privacy        example, procedural controls are built
     Compliance Policy and Guidelines to         into our interactive Point of Sale “iPoS”   Contributing to
     ensure adequate safeguards for our          and interactive Mobile Office (iMO)         our communities
     customer and business data as well          systems that have been adopted by
     as compliance with data protection          our insurance agents in their sales         operating
                                                                                             responsibly
     legislation. These policies and             processes and broader day-to-day
     guidelines are communicated to all          operations. These controls include
                                                                                             FEEDBACK
     employees and our insurance agents          user authentication, secure storage of
     when they join AIA and are regularly        customers’ data on servers controlled
     reinforced through refresher training.      by AIA and transaction audit trails.        GRI and HKEx
     All employees and agents are required                                                   guide content
                                                                                             Index
     to safeguard customers’ personal            AIA also reviews the data security
     information and are prohibited from         standards of our third-party vendors
     disclosing customer information to          through our Third Party Security
     unauthorised parties.                       Assessment process. This process
                                                 regularly assesses a broad range
     AIA also has in place a number of           of security controls of our vendors,
     Information Technology standards,           including data security and encryption,
     such as a Cloud Security Standard,          against industry standards such as
     a Data Protection Standard and a            ISO27001 and those by the National
     Mobile Application Security Standard,       Institute of Standards and Technology
     to ensure sufficient operational controls   of the United States (NIST).
     which meet our information security
     objectives. Any cloud services providers
     we engage must also adhere to our                   AIA’s Privacy Policy Statement
                                                         is publicly available and can be
     Cryptography Standard.
                                                         viewed here.

20    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
CYBERSECURITY PREPAREDNESS                           SUPPLY CHAIN MANAGEMENT

     AIA is committed to protecting the interests         We work with many different product and
     of our customers, partners, employees and            service providers across our business.
     stakeholders by providing a world-class              Sustainability is a key element of our supply   About this
                                                                                                          Report
     information and security environment. AIA’s          chain as summarised in our Supplier Code
     Group Information Security Policy is aligned to      of Conduct (“Supplier Code”). The Supplier
                                                                                                          Doing
     industry leading standards to ensure that our        Code was developed to complement the            Business in the
     systems, processes and information are secured.      Code, which is also applicable to our           right way

                                                          suppliers, and references international         THE RIGHT
     Our Group Chief Technology and Operations            conventions such as the UN Declaration on       PEOPLE
     Officer and a dedicated information security         Human Rights and AIA’s ESG memberships.
     team oversee the quality and consistency of          The Supplier Code encourages sound ESG          Contributing to
                                                                                                          our communities
     technology risk management and cybersecurity         practices among our suppliers and a general
     across the Group. The team maintains a focus on      culture of integrity in all matters.
                                                                                                          operating
     protecting AIA from the latest cyber threats by                                                      responsibly
     detecting any anomalies, effectively responding      As a Group, we work with suppliers that
     to cybersecurity issues, enhancing defensive         demonstrate best practice. Dedicated due        FEEDBACK
     controls and investing in security analytics. We     diligence processes form a part of our
     also partner with leading information security       existing supply chain management and
     services providers to provide further capability     monitoring system. This includes conducting     GRI and HKEx
                                                                                                          guide content
     on ensuring a secure operational environment.        supplier and third-party assessments where      Index
                                                          necessary, as well as requesting information
     AIA focuses on protecting our critical assets        on employment and environmental practices
     from cyber threats using classification and threat   from selected material suppliers through our
     modelling techniques. This includes focusing on      supplier registration process.
     our key systems that process our customer data
     as well as key supporting business processes,
     and software specifically designed to address
     cyber risk in this area. All cybersecurity issues
     are handled by the Director of Information
     Security who reports directly to the Head of
     Group Technology Governance.

     AIA believes that cybersecurity is the
     responsibility of every employee. Therefore, we
     educate our employees about how to protect
     themselves and AIA from cyber threats through
     web-based awareness and readiness training
     and conducting regular cyber-defence
     assessments including incident
     management drills.

21    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
CUSTOMER SERVICE STANDARDS

     People are at the heart of our business, and                            To assist our customers in making well-
     this means ensuring that we adhere to the                               informed decisions, internal standards on
     high standards of quality and customer                                  sales illustrations also promote a consistent   About this
                                                                             approach to fair disclosure in accordance       Report
     service expected by our customers.
                                                                             with regulations.
                                                                                                                             Doing
     AIA has in place a robust business quality                                                                              Business in the
     framework which allows us to meet these                                 All business units and subsidiaries have        right way

     expectations. The framework includes the                                checks and controls in place to ensure
                                                                                                                             THE RIGHT
     following key elements:                                                 compliance with our standards.                  PEOPLE

     •	An agency Code of Conduct       outlines
                                                10                                                                           Contributing to
                                                                                                                             our communities
          our standards of integrity, behaviour and
          compliance obligations applicable to our                                                                           operating
          tied agents.                                                                                                       responsibly

     •	An agency training programme on sales                                                                               FEEDBACK
          conduct and a guideline on the agency sales
          process. AIA’s agency sales process provides
                                                                                                                             GRI and HKEx
          a framework for how agents should sell our                                                                         guide content
          products. This includes Know-Your-Customer                                                                         Index
          diligence and need-based sales practices
          to establish clients’ needs, priorities and
          circumstances, including the amount of
          existing life insurance coverage they
          already have. This allows agents to
          recommend suitable products with
          appropriate coverage.

     •	Our iPoS technology guides our agents
          through the sales process and helps ensure
          a consistent, high-quality customer
          experience.

     •	Monitoring of adherence to our standards,
          through various means, including direct
          verification calls with customers
          and a mystery shopping programme.
          Misrepresenting, or attempting to mislead or
          deceive customers by agents, for example
          through use of unsupported or fictitious
          claims about AIA products or those of our
          competitors, is not acceptable and may
          result in disciplinary action.

     10
          Applicable to AIA’s tied agents, and intended to be referred to in conjunction with the Code.

22        ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
CUSTOMER ENGAGEMENT
                                                                                                                                 About this
     With more than 33 million individual policies       To understand how we can continue to enhance                            Report

     and over 16 million participating members           the customer experience at all stages of the
     of group insurance schemes, the scale and           journey, one of our initiatives is running an                           Doing
                                                                                                                                 Business in the
     footprint of our customer base presents a           annual customer relationship survey. Insights                           right way
     huge growth opportunity as we actively engage       provided by our customers’ feedback from the
                                                                                                                                 THE RIGHT
     and nurture long-term relationships with            survey have helped us enhance our customer                              PEOPLE
     our customers.                                      engagement and experience, and ultimately drive
                                                         retention, repurchase and recommendation level.                         Contributing to
     Achieving our promise of enabling Healthier,        We also conduct deep research to understand                             our communities
     Longer, Better Lives requires that we engage        the needs of various customer segments in order
     in a meaningful way with our customers at           to customise our propositions to them. In Hong                          operating
                                                                                                                                 responsibly
     each touchpoint in their journey, allowing us to    Kong, this research has allowed us to develop
     develop a deep understanding of their unique        digital sales tools such as segmentation toolkits,
                                                                                                                                 FEEDBACK
     needs and wants, and meet their requirements.       which support our team and our agents in
                                                         engaging our customers.
     In 2018, we continued to improve the customer                                                                               GRI and HKEx
     data we capture and used propensity models                                                                                  guide content
                                                                                                                                 Index
     and advanced machine learning methodologies
     to address customer protection and savings
     gaps and develop the right propositions,
     delivered at the right time and in the right way.

        ListENing to customer feedback
        Staying at the forefront of our          customer needs where required. The
        industry relies on us being able to      system also helps to drive structural
        place our customers at the heart of      improvements, enabling us to identify
        our business. This involves collecting   key issues in our processes if and
        and responding to customer               when they arise.
        feedback, while delivering a holistic
        support experience through each        The system is an integral part of AIA
        and every interaction with AIA.        China’s customer communication
                                               strategy. AIA China takes pride
        Closed loop feedback management        in reviewing and analysing each
        systems provide companies with         comment, so that it is able to continue
        the tools they need to identify key    to improve on its service and provide
        touchpoints throughout the customer an unparalleled customer experience.
        lifecycle, and seek feedback at these
        stages. This enables companies to      Feedback from the system revealed
        continue a dialogue with customers     an overall customer satisfaction rate
        regarding their feedback.              for AIA China of 99 per cent, with 96
                                               per cent of customers being satisfied
        These systems are in place at AIA      with our customer service centres as
        China, allowing it to understand       at 31 December 2018.
        what matters to its customers on an
        ongoing basis, as it collects customer                                           Overall customer satisfaction rate of
        feedback at every touch point with its
        business. This has enabled AIA China
        to take prompt action to address                                                 99%

23    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
SECTION 3

                                                        About this
                                                        Report

                                                        Doing
                                                        Business in the
                                                        right way

                                                        THE RIGHT
                                                        PEOPLE

                                                        Contributing to
                                                        our communities

     THE
                                                        operating
                                                        responsibly

                                                        FEEDBACK

                                                        GRI and HKEx

     RIGHT
                                                        guide content
                                                        Index

     PEOPLE

24   ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
About this
                                                                                                                             Report
     We are proud of our people                          OUR EMPLOYEE WORKFORCE
     and the culture at the heart of                     As at 31 December 2018, AIA had a total of
                                                                                                                             Doing
                                                                                                                             Business in the
     our Company.                                                                                                            right way

     At AIA, equipping our employees for success
                                                         22,263               EMPLOYEES11                                    THE RIGHT
                                                                                                                             PEOPLE
     is vital to serving our customers and enabling
     our communities to live Healthier, Longer,          which included full-time and part-time staff,                       Contributing to
                                                         as well as employees on fixed term contracts12.                     our communities
     Better Lives.

                                                                                                                             operating
     Our vision to be the world’s pre-eminent                                                                                responsibly
                                                         Percentage of employees across markets
     life insurance provider is supported by
                                                         (as a percentage of total employees)13
     our many employees and agents. Guided                                                                                   FEEDBACK
     by our Operating Philosophy of “Doing the
     Right Thing, in the Right Way, with the Right
                                                         Hong Kong
                                                                          11.5%               15.0%
                                                                                           China
     People... the Right Results will come”, we
                                                                          17.6% Singapore 6.4%
                                                                                                                             GRI and HKEx
     focus on recruiting, developing and retaining       Malaysia                                                            guide content
                                                                                                                             Index
     capable, engaged and high-performing
     employees who can continuously learn and
     grow while delivering their best work. These
                                                         Thailand
                                                                          11.3% Other Markets 38.2%
     are people who thrive in our customer-
     centric culture, embrace AIA’s brand promise
                                                         Permanent employee turnover 14
     and exhibit our leadership characteristics.
                                                         Permanent employee turnover across the Group was
     AIA’s people strategy is designed to build          16.6% in 2018. The APAC region provides many career
     capabilities for the future, transform the          opportunities with increasing demand and competition
     way we work and recognise sustained high            for skilled talent. We actively monitor our employees’
     performance.                                        levels of engagement and the programmes we offer
                                                         them to create an environment in which they can do
                                                         their best and ensure we retain our talent.

                                                         11
                                                              The increase compared to 30 November 2017 is primarily
                                                              due to our acquisition of Sovereign.
                                                         12
                                                              Excludes interns, agents and employees of Tata AIA.
                                                         13
                                                              Figures for Hong Kong include Group Office employees,
                                                              figures for China and Malaysia include our employees in our
                                                              shared services centres.
                                                         14
                                                              Permanent employees exclude employees on fixed term
                                                              contracts. As part of an update to the methodologies we
                                                              apply to certain data of the Group this year, permanent
                                                              employee turnover excludes involuntary turnover. Turnover is
                                                              calculated using monthly average headcount for the twelve
                                                              months ended 31 December 2018.

25    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
About this
                                                                                                                     Report

                                                                                                                     Doing
                                                                                                                     Business in the
                                                                                                                     right way

                                                                                                                     THE RIGHT
                                                                                                                     PEOPLE

                                                                                                                     Contributing to
                                                                                                                     our communities

                                                                                                                     operating
                                                                                                                     responsibly

                                                                                                                     FEEDBACK

                                                                                                                     GRI and HKEx
                                                                                                                     guide content
                                                                                                                     Index

     DEVELOPING OUR LEADERS                                                The ALC has now entered its third year
                                                                           of operation.

                                                                           In 2018, it hosted more than
     Our AIA Leadership Centre (“ALC”) based in
     Bangkok is a world-class learning facility
     offering various programmes to our senior
     executives, top agency leaders and key
                                                                           240               events

     partner executives. With a clear focus on                             Delivered more than
     AIA’s strategic and governance priorities,
     the ALC continues to deliver impactful
     leadership development programmes,
                                                                           20          customised
                                                                                       leadership
                                                                                       programmes
                                                                           partnering with world renowned
     including those focusing on:                                          business schools and consulting firms.

     Executive Leadership                Technical Leadership              At AIA, we make it a top priority to
     Targeting AIA’s current             Designed to develop technical     develop our people and their leadership
     and future executives, our          and professional capabilities     and functional capabilities. We believe
     programmes are designed to          within our core functions to      in growing our leaders from within and
     accelerate executive leadership     promote operational excellence.   in 2018, we closed a large proportion
     as well as management                                                 of our senior management positions
     capabilities. Our Enterprise        Distribution Leadership           through internal progression. Committed
     Leadership Programme                Designed for AIA’s senior         to having a strong pipeline of senior
     continues to be our signature       distribution leaders, senior      leaders, we conduct a comprehensive
     programme offering to all           agents and partners, these        Group-wide people review process
     markets.                            programmes develop the sales      annually to identify and plan for the
                                         leadership and technical skills   succession of key roles. In 2018, we
                                         required to produce consistent    reviewed approximately 1,400 senior
                                         best in class results.            positions across the Group, ensuring we
                                                                           consider succession planning from a
     Ethical leadership training is also provided to our senior            holistic perspective.
     finance leaders at the ALC to help ensure ethical risk issues
     are considered in their decision making and behaviour.

26    ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
FOSTERING A CULTURE OF
     PEOPLE DEVELOPMENT                                                                                                  About this
                                                                                                                         Report

     EMPLOYEE LEARNING AND DEVELOPMENT                               We continuously review feedback from our            Doing
     We foster a robust learning culture at AIA                      employees, the content of our courses and           Business in the
                                                                                                                         right way
     that empowers our people to develop critical                    training material to ensure our programmes
     capabilities for their current roles and                        deliver value for the business and develop our      THE RIGHT
                                                                                                                         PEOPLE
     career aspirations. AIA’s enterprise-wide                       people for the future.
     development framework aligns our people
     development with our business strategy and                      AIA practices a holistic approach to learning       Contributing to
                                                                                                                         our communities
     talent needs. Core development modules                          and development, whereby skills and
     for senior employees such as the People                         knowledge are accumulated from on-the job
                                                                                                                         operating
     Manager Accelerator Programme and the                           experience, activities such as mentoring and        responsibly
     AIA Manager Series remain foundational                          coaching and classroom and online based
     curriculum items offered throughout the                         learning. We present below the average training     FEEDBACK
     year. These core modules are complemented                       hours in 2018 by employee category and
     with a wide variety of skills-based training to                 gender. The numbers do not capture all online
     target individual development needs as well.                    learning activities, mentoring and coaching,        GRI and HKEx
                                                                                                                         guide content
                                                                     knowledge sharing sessions or professional          Index
     In 2018 we expanded the digitisation of                         development courses undertaken by our
     learning content and delivery methods                           employees.
     with the launch of a new learning platform
     that centrally houses an extensive range of                     Through our programmes, we aim to cultivate
     content. This platform (“Catalyst”) provides                    forward looking leadership and managerial
     employees with flexibility regarding the                        mindsets, and skills that will ensure the
     subject matter they would like to develop                       sustained growth and development of our
     while addressing some key principles of                         people. The strengthening of these skills
     modern learning – access to content is on-                      enables us to capture the vast growth
     demand, anytime and anywhere.                                   opportunities in the region, allowing us to
                                                                     provide the right solutions for our customers’
     Courses offered on Catalyst include technical                   protection and savings needs.
     skills, crisis management, effective leadership
     and healthy living practices, among many                        As we transform our functional operating
     others. Catalyst has been rolled out at Group                   model, we have also outlined capability
     Office and six business units, with plans for                   roadmaps to provide our leaders and employees
     further expansion in 2019.                                      with key knowledge, skills and behaviours
                                                                     required for their success in future roles. We
                                                                     offer internal mobility opportunities in other
                                                                     teams, functions and markets to broaden our
                                                                     employees’ perspectives and present new
                                                                     career experiences.

     Average hours of training15

     by gender                                                       by Employee category

             Male                             14.3                   Junior Staff                12.4

           Female                             14                     Middle
                                                                     Management
                                                                                                           18.4
                                                                     Senior
                                                                     Management                                   22.2

     15
          Training hours for Sovereign employees are not included.

27        ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
Lo Si Io
     EMPLOYEE MENTORING                                                                   Lo Si Io, an agent with AIA Macau, shares her                                     About this
     Mentorship programmes are currently offered                                          passion for her job, interests and getting                                        Report

     and supported at our Group Office and in many of                                     started in her career.
     our markets. These programmes are structured                                                                                                                           Doing
                                                                                          “I used to think that it was important to choose your                             Business in the
     to allow our employees to expand their networks,                                                                                                                       right way
     benefit from guidance, and foster communication                                      career early on, and then stick with the job you’d
     across departments and seniority.                                                    chosen the rest of your life. That was what made you                              THE RIGHT
                                                                                                                                                                            PEOPLE
                                                                                          successful.
     AGENT LEARNING AND DEVELOPMENT                                                                                                                                         Contributing to
     AIA’s Premier Agency strategy offers our                                             In 2013, I was a first-year student at university,                                our communities
     agents world-class training and development                                          studying to be a professional chef when I met my
     opportunities. Since the launch of our Premier                                       current manager. I was inspired by her success and                                operating
     Agency strategy, we have focused on developing                                       her ability to speak to many different types of people                            responsibly

     best-in-class agents that enable us to offer high-                                   with ease. While her job was challenging, her work
     quality advice to customers and provide them with                                    was meaningful, and I could see that she was really                               FEEDBACK

     the savings and insurance cover they need. Please                                    making a difference in people’s lives. I decided
     refer to the Business Review Section of Annual                                       shortly after to take up a new challenge, and work
                                                                                                                                                                            GRI and HKEx
     Report 2018 for further details on AIA’s Premier                                     for her.                                                                          guide content
                                                                                                                                                                            Index
     Agency Strategy.
                                                                                          While my performance was not ideal the first
     As part of the onboarding process, all prospective                                   year, through hard work, dedication and under the
     agents are required to attend training and                                           guidance of my manager, I qualified as an MDRT16
     development programmes that are tailored to their                                    member in my second year, and have continued to
     needs and are designed to equip them with the                                        be an MDRT member thereafter. This is probably
     necessary skills to be productive.                                                   what I am most proud of.

     This year, we continued to innovate new                                              It’s not been too difficult to strike a balance between
     approaches to training and development through                                       work and leisure. Healthier, Longer, Better Lives
     digital classroom and mobile learning platforms,                                     has always been a way of life to me. It’s something
     making learning easier and more accessible to                                        that we can all relate to. Personally, I think it’s
     our new agents and agency leaders in major                                           quite important to manage one’s schedule, and this
     cities. We plan to roll out these initiatives to other                               includes making time for leisure. I love yoga and
     cities and all agents and agency leaders in 2019.                                    taking it up as practice also helps me relax.
     Structured courses allow us to encourage the
     right behaviours, enabling our agents to be more                                     Healthy living is just as important to my clients.
     effective in their jobs. This includes a training                                    I even play badminton with them sometimes. AIA’s
     roadmap, online assessments, study materials and                                     efforts to promote healthy living have always been
     course evaluations, all of which are accessible                                      a talking point when I meet my clients, especially
     on mobile devices and within a paperless                                             nowadays when people are more conscious of their
     environment.                                                                         health. Many of them are interested in AIA Vitality,
                                                                                          and always ask me for advice on ways to earn points
                                                                                          and collect rewards.
          “It’s now been six years since I made my career
          switch. it’s been an exciting journey!”                                         I also rely on a lot of different apps and technology
                                                                                          on a day to day basis, this includes staying in touch
                                                                                          with friends, family or clients. AIA’s iPoS is a tool
                                                                                          that I use very often. Previously, I’d need to meet
                                                                                          a client about four to five times until I had all the
                                                                                          necessary information for a policy, but now it only
                                                                                          takes one or two meetings. It’s also a lot easier to
                                                                                          service customers and their needs, this includes
                                                                                          providing them with policy information or changing
                                                                                          their address. Plus, there’s little need for me to carry
                                                                                          around a lot of paper.”

     16
           DRT is internationally recognised as the standard of excellence in the life insurance and financial services business. Its members are required to generate a
          M
          certain level of premium, commission or income, and demonstrate professional knowledge, strict ethical conduct and outstanding client service.

28        ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT 2018
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