PARTNERING WITH YOU TO DO GREAT THINGS - Positive Futures Plan 2015 - Old Mutual
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Positive Futures Plan
2015
PARTNERING
WITH YOU TO DO
GREAT THINGS
02
CONTENTS W E LC O M E TO O U R
P O S I T I V E F U T U R E S P L A N 2 015
01 Our business overview
02 A responsible approach
03 Our Positive Futures Plan Our purpose is to help our customers thrive by
04 The world in which we operate enabling them to achieve their lifetime financial
09 External frameworks goals, while investing their funds in ways which
11 The business case for our Positive Futures Plan
13 How we added value across Africa in 2015
will create a positive future for them, their families,
14 The positive impact we are making their communities and the world at large.
15 – Financial wellbeing
18 – Responsible investment Q&A with
Gail Klintworth Our strategy Our strategic priorities
To execute a managed separation of the Working with our businesses in delivering
17
■■
Group into four strong standalone entities. enhanced performance relative to their
peer groups.
A managed separation of the Group will free ■■ Stewardship of the managed separation
the constituent parts into four independent process, balancing value, cost, time
businesses, each having a capital structure and risk.
and dividend policy suitable for its own ■■ Fulfilling the Group’s ongoing regulatory
strategy that will allow it to access its natural obligations; and managing the Group’s
shareholder base. debt obligations, central cost reductions
Following the managed separation, the and distributions to shareholders.
lead regulator for each business will then Our values
be the same as the local regulator. We are committed to being a responsible
We will manage the separation of the Group business with a view to the long term and
in a manner that aims to enhance value to will focus on areas where our businesses
Raising the Pupil at Richard Varha Secondary School, South Africa
shareholders over time. can make a material impact and create
standard For definitions of terms used in this meaningful change. Our businesses will
report, visit our Glossary continue to be guided by our strong values:
respect, integrity, accountability and pushing
www.oldmutual.com/reportingcentre beyond boundaries.
We have made excellent progress on the responsible
business agenda. It is now time to boldly move this
agenda forward through our Positive Futures Plan
Bruce Hemphill
O L D M U T UA L P LC Group Chief Executive
P O S I T I V E F U T U R E S P L A N 2 015
O U R B U S I N E S S OV E RV I E W Our services 01
■■ Life assurance
General insurance
18.9m
■■
■■ Protection
■■ Investments and savings
Customers
£1,663m ■■
■■
Lending
Asset management
OUR BUSINESS Adjusted operating profit
(pre-tax and NCI)
■■ Health insurance
Our markets
OVERVIEW ■■ South Africa
UK and Europe
£327.9bn Over 170
■■
Over 170 years on from our ■■ United States
■■ Africa (excluding South Africa)
first mutual life insurance Asia and Latin America
company in Cape Town, Funds under management years old ■■
South Africa, we continue
to build on our heritage of
trust and accountability;
64,043 Employees
offering financial security in
uncertain times and meeting
the diverse financial services OUR FOUR STRONG BUSINESSES
needs of our customers
throughout their lives. Old Mutual Nedbank Old Mutual Wealth (UK) Institutional Asset
Emerging Markets Management
We provide financial solutions to We provide a wide range of We provide advice-driven wealth We provide a diverse range of
retail and corporate customers wholesale and retail banking solutions to customers in the UK and investment strategies and products,
across a number of market services and a growing insurance, a number of cross-border markets. delivered via a multi-boutique model
segments and geographies. asset management and wealth to institutional investors.
offering to individuals and businesses.
www.oldmutual.com/about
£43.4bn
Funds under management
£11.9bn
Funds under management
£104.4bn £168.2m
Funds under management Funds under management
O L D M U T UA L P LC
P O S I T I V E F U T U R E S P L A N 2 015
Q&A with
O P E R AT I N G 02
R E S P O N S I B LY
Gail Klintworth £1.9bn Total tax paid
1
A RESPONSIBLE Q – What does it mean to
be a responsible business?
education and inclusion. We’ve also set targets
for investments in the green economy and
APPROACH A – It’s about working to add value for all of our
stakeholders. Banks, insurance companies and
infrastructure, and transparency around
responsible investment.
investment houses were founded on the power of Q – Why is a long-term
£2.6bn
doing things together: pooling people’s money to view so important? 2
manage risks and returns better than they could
do as individuals. But trust in financial services A – Financial wellbeing and responsible
investment are by nature long-term. Financial Committed investment
companies has dwindled as they are perceived wellbeing depends on giving everyone access in renewable energy
to focus on increasing rewards for shareholders to financial services that meet their current and
and executives at the expense of customers. At
Old Mutual we want to live up to our true purpose
– helping customers to achieve their financial
goals, while investing their funds in ways that
future needs, while basic financial literacy is the
key to greater independence and achieving their
lifetime financial goals.
+8%
Annual customer growth
create a positive future for them, their families, the Responsible investment promotes the sustainability (18.9m customers)
community, and the wider world. This in turn will of our planet and its inhabitants. By allocating
ensure sustainable returns for shareholders too. capital responsibly, we help to maximise
opportunities and ensure scarce resources are
Q – Why focus on financial wellbeing used effectively. Progressive companies naturally
and responsible investment?
Gail Klintworth think long-term, embedding environmental and
A – We want to be a leader in responsible social issues in their strategies. These focus areas
Group Customer Director and business and we believe financial wellbeing and
Responsible Business Lead will deliver sustainable, long-term value for us
responsible investment are where we can make a
Read more about long-term positive difference. Our Positive Futures
our approach at: Plan, developed with the Cambridge Institute of
and for society.
£16.7mInvested in our
Sustainability Leadership, has ambitious goals
www.oldmutual.com/rb to reach millions of individuals through financial
communities
All figures for the year, as at 31 December 2015.
1 Total taxes paid including corporation tax, VAT and
tax paid on behalf of all employees
2 Committed investment on behalf of our
Collaborative approaches to solving global scale customers through Old Mutual Emerging
issues is critical. In the long term our markets will Markets and Nedbank.
develop and society will benefit
Gail Klintworth
O L D M U T UA L P LC Group Customer Director
P O S I T I V E F U T U R E S P L A N 2 015
Our Positive Futures Plan 03
FOCUS AREAS
Financial wellbeing Responsible investment
p15-17 p18-20
A PLAN TO
TACKLE THE BIG G OA L S
CHALLENGES
Our purpose is to help our
customers thrive by enabling
them to achieve their
lifetime financial goals, Education Products that drive A commitment Investment An investment approach A commitment
while investing their funds at scale societal value to transparency at scale that drives societal value to transparency
in ways that will create a
positive future for them, their
families, their communities
50m
people reached by
20m
people reached by
We will commission
and publish
independent research
10%
of our funds under
100%
compliance with our
100%
of our funds offered are
and the world at large. our financial education micro-finance and on the benefits management Responsible Investment publicly, environmentally,
programmes micro-insurance to customers of invested in the Standard and socially and governance
products which add our products green economy 100% proxy votes cast (ESG) rated
positive value to society and infrastructure where applicable
O U R 2020 G OA L S
While delivering value through projects and partnerships in these areas we must maintain
our licence to operate through our strong foundations in treating customers fairly, good
governance, our culture, transformation, capital cover and risk management.
www.oldmutual.com/rb
O L D M U T UA L P LC
P O S I T I V E F U T U R E S P L A N 2 015
Positive 04
transformation
to a digitised Growing population
THE WORLD economy and urban living
There is increased pressure on agricultural production,
IN WHICH D I G I TA L D I V I S I O N I N A F R I C A 1
Individuals with internet access natural resources, housing and other infrastructure which
are struggling to cope with growing populations. More
WE OPERATE 1 1 1
investment and support are needed to provide for an
ageing population, particularly regarding health and
Income financial management. A growing middle class, with high
With the help of the distribution 2 Age Location consumer demands but low savings and insurance cover
Cambridge Institute for (household) 2 highlights the need for long-term financial support.
Sustainability Leadership, 2
we have identified a number As infrastructure is being built, there is a profound need for
of interconnected global urban solutions that adapt and respond to change; efficient
sanitation systems, water delivery, waste management and
trends that will impact 1. Bottom 40% 1. Young (15-24) 1. Rural
transportation systems all need to be able to accommodate
the world in which we 2. Upper 60% 2. Mature (45+) 2. Urban
increasing numbers of people and industry while being
operate and the future resilient to climate change and natural disasters.
of our business. In many countries, technology provides more people
with access to products and services which opens
up new markets and generates increased economic
benefits. However, access to technology may also exacerbate
income differences within some countries with those adapting
quickly benefiting from technology-driven economic growth.
x3
Africa’s urban
population is expected
With increased reliance on technology, there is an to triple by 20252
Read more about our increase of cyber risks such as mismanagement of
Group level risks in our
Annual Report 2015: personal data, critical system failures and cyber attacks.
Businesses are responding with resources committed to Contributing to affordable housing in Karino, South Africa
www.oldmutual.com/reportingcentre technology and digital safety for employees and customers.
1 “World Development Report 2016: Digital Dividends” World Bank
2 “The Global Risks Report 2016”, World Economic Forum.
Rapid urban growth is having a major impact on ecosystems with consequences
for human health and security. Financial service companies can play a critical
role, collaborating with others to deliver positive outcomes for society
Polly Courtice
O L D M U T UA L P LC Director, Cambridge Institute for Sustainability Leadership
P O S I T I V E F U T U R E S P L A N 2 015
THE WORLD
IN WHICH Extreme weather 5.5
T H E G LO B A L R I S K S L A N D S C A P E 2 05
W E O P E R AT E
CONTINUED events and Failure of
climate-change
Water crisis mitigation and
changing climate 5.0
Critical information
Asset bubble
Fiscal issues adaptation
Cyber attacks
infrastructure breakdown Unemployment or
G LO B A L R I S K S O F H I G H E S T C O N C E R N 1 Failure of financial underemployment
mechanism or institution
Impact
Extreme weather events
1. Water crisis 4.5 Adverse Data fraud or theft Natural catastrophes
1 2. Failure of climate- consequences Deflation
change mitigation Unmanageable of technological
inflation advances
4 and adaptation Man-made
environmental
3. Extreme weather catastrophes
events Failure of critical
4.0 infrastructure
4. F ood crisis
2
3 Failure of
urban planning
3.5 4.0 4.5 5.0 5.5 6.5
Likelihood
Changes to our climate are leading to increased
environmental risks, impacting on food and water
security and increasing uncertainty for current
Youth unemployment
Unemployment affects business in many
and planned infrastructure. In the extreme these ways from slowing economic growth to
changes could lead to ecosystem collapse, the
need for large-scale migration and amplify
Dry river bed in Kruger National Park, South Africa social security problems. Growing competition
threatening social stability. Unemployment
amongst youth is a particular concern, as
they leave the education system
11m
By 2030, South Africa
for resources, particularly water will be exacerbated inadequately skilled or prepared for the aims to create
by climate change. demands of current jobs markets. This 11 million new jobs
demographic pressure helps to explain
Read more about the trends we have As highlighted in the graphs above, weather events why unemployment in sub-Saharan Africa
identified in our Annual Report 2015: and climate change rank high for World Economic is considered such high risk and requires
Forum stakeholders. business to adapt and diversify.
www.oldmutual.com/reportingcentre
1 Risks of highest concern over next ten years as rated by World Economic Forum survey respondents
2 “The Global Risks Report 2016”, World Economic Forum.
By 2035, sub-Saharan Africa is projected
to have more young people reaching working
age than the rest of the world put together
O L D M U T UA L P LC
P O S I T I V E F U T U R E S P L A N 2 015
What this
THE WORLD 06
IN WHICH
W E O P E R AT E
CONTINUED
means for us
Our Positive Futures Plan is a bold progression We have thoroughly researched and spent Patrick O’Sullivan
for Old Mutual but one that builds on solid and significant time to ensure our Plan is aligned to Chairman
long-standing foundations in our approach to relevant international and national frameworks, Our primary purpose is to enable
operating a responsible business. addresses the biggest issues in the markets in positive futures. We do this by
We hope that as the Plan develops and is which we operate and maximises the skills and helping our customers save, invest,
delivered, that our external stakeholders knowledge of our people. We are also scaling lend and protect against risk, and
will also be enthusiastic about the benefits up our current activities by developing existing by providing for them in retirement,
it brings to them and to others. or creating new partnerships. Instead of while responsibly investing the
delivering lots of small projects across our money they entrust to us in the green
business, we can now focus our resources and economy and infrastructure projects.
build measurements to help us track where our
efforts make the greatest difference.
We have complete engagement This all means that we will create long-term
from our leadership, the Plan benefits which will have lasting positive impact
is embedded in our strategy and on both our business and society. Our Positive Futures Plan
it is creating excitement for reinforces our vision to
our employees be our customers’ most
trusted partner
Helen Wilson
Group Head of Responsible Business Helen Wilson
Group Head of Responsible Business Patrick O’Sullivan
Chairman
www.oldmutual.com/rb
Working in partnerships with others, we are consolidating our efforts to
address issues important to our society. Our Plan provides the framework
to work together across the Group to achieve the same goals
Khanyi Chaba
O L D M U T UA L P LC Head of Responsible Business, Old Mutual Emerging Markets
P O S I T I V E F U T U R E S P L A N 2 015
What this means
THE WORLD 07
IN WHICH
W E O P E R AT E
CONTINUED
for our four strong
business units
For each business, there are Old Mutual is proud to be involved
elements of the Positive in the communities we serve –
Futures Plan which has more an ethos which is a cornerstone in
resonance based on the each of our businesses. In particular, Ralph Mupita
markets they serve, the skills we have a very special relationship Chief Executive Officer, Old Mutual Emerging Markets
of their employees or their with South Africa and the African
own business strategy. continent. We remain committed to Old Mutual Emerging Markets (OMEM)
Our business leaders are being proactive in our contribution As a proud African business we recognise that we
committed to ensuring the to society, including the growth of have a significant role, partnering with others, to
continued integration of jobs, housing and income. support prosperous societies with positive futures.
responsible business activities Our Positive Futures Plan has the Our business decisions take full account of the social
into their operations and commitment from all our business and environmental challenges facing our markets.
delivering the aims and leaders because it consolidates the As part of my commitment to integrate the Plan
goals of the Plan. great work our business units are across OMEM, we will scale-up our involvement
Bruce Hemphill doing in financial wellbeing and
Group Chief Executive in financial education and enhance current
responsible investment, and unites programmes; in recognition of the high levels of
us in our long-term view of creating indebtedness and financial constraints that our
positive futures for all. customers face.
Read more about our As such, we will help build their financial wellbeing
business units in our and long-term prosperity, while at the same time,
Annual Report 2015: responsibly invest their funds in ways that will
contribute to the socio-economic development
www.oldmutual.com/reportingcentre of Africa.
The Group’s new strategy will seek to unlock
and create significant long-term value
Bruce Hemphill
Group Chief Executive
O L D M U T UA L P LC
P O S I T I V E F U T U R E S P L A N 2 015
THE WORLD
IN WHICH What this means 08
W E O P E R AT E
CONTINUED for our four strong
business units
Old Mutual Wealth (UK)
When customers trust us with their savings we have a duty
to invest responsibly on their behalf. That means we think
about risk in broad terms and use our position as a
shareholder to hold companies to account, promoting Peter Bain
strong corporate governance and sustainable business Chief Executive Officer, Institutional Asset Management
models. This is one element of my commitment to the
Positive Futures Plan alongside further embedding Institutional Asset Management
responsible business practices across our business. We will continue to build on our strong foundation
of ethical values, treating clients fairly and good
Mike Brown governance that is so critical to our custodianship of
Chief Executive Officer, Nedbank our clients’ money. In 2015, our Affiliates devoted a
good deal of attention, appropriately, to the topic of
Nedbank responsible investing and studying ways in which each
To be a sustainable business, I recognise that Nedbank might add value to its clients within the framework of
needs to operate within the confines of environmental
limits while meeting social needs. Our eight Long-term its investment discipline and client mandates.
Goals guide our strategy in this regard and will result in
us being a more resilient bank that delivers value to our
stakeholders. Our strong legacy position as a green and
caring bank means we are uniquely placed to develop
differentiated commercial offerings that shape the macro
environment and deliver a better future for all. Fair Share
2030 and our approach to integrating sustainability into Paul Feeney
our strategy align to the aims of the Positive Futures Plan. Chief Executive Officer, Old Mutual Wealth
O L D M U T UA L P LC
P O S I T I V E F U T U R E S P L A N 2 0151
Sustainable Development T H E S U S TA I N A B L E 09
Goals (SDGs) D E V E LO P M E N T G OA L S
We view the SDGs as an opportunity for
us to collaborate with others in order to Across the Group our businesses are delivering
scale up and innovate around existing projects that support seven of the SDGs.
initiatives that contribute to progress These are Goals 4, 7, 8, 9, 10, 13 and 17.
towards achieving the goals. Over the
EXTERNAL coming year, we will continue to explore
the best way we can align our Plan
FRAMEWORKS with specific goals and demonstrate
Old Mutual’s active commitment to the
sustainable development agenda of
We are mindful of operating ending poverty, protecting the planet
within international and local and ensuring prosperity for all.
frameworks and following
internationally recognised
standards to ensure we are
contributing to coordinated
efforts to address the world’s
biggest social, economic
and environmental issues. We are supporting our corporate
partners, including Old Mutual
to turn businesses into positive
transformative forces
Steve Kenzie
Executive Director,
UN Global Compact Network UK
Read more about
our partnerships at:
https://sustainabledevelopment.
www.oldmutual.com/rb un.org/sdgs
Responsible businesses have enormous power to create decent
jobs, open access to education and unlock energy solutions
Ban Ki-moon
Secretary-General of the United Nations
O L D M U T UA L P LC
P O S I T I V E F U T U R E S P L A N 2 0152
EXTERNAL United Nations Global Compact Our affiliations and partnerships 10
F R A M E WO R K S Since 2010, we have reported our progress in aligning We collaborate with a number of partners to help us deliver
CONTINUED our strategies and operations with the 10 universally programmes, rate our performance and identify opportunities.
accepted principles in the areas of human rights, labour, In addition to reporting the impact of our Plan, we will continue
environment and anti-corruption. We view these as to disclose our progress in responsible business and be benchmarked
foundations to our approach to responsible business through a range of guidelines and ratings which have long positively
and continue to develop the approach as national influenced the way we conduct our business. Highlighted below are
legislations change and we increase transparency in some of our key affiliations.
our activities.
3
1
Old Mutual’s commitment United Nations-supported Principles
to the PRI’s six principles for Responsible Investment (PRI)
underscores how seriously In 2012, Old Mutual became a signatory to the PRI
they take sustainability as an asset owner. In the same year, we completed
issues. They have the vision to a review of our responsible investment practices using
understand that considering the reporting framework. We continue to report our
ESG factors can lead to progress using the this framework on an annual basis as Read more about
identifying new opportunities, we believe transparency demonstrates our commitment our partnerships at:
better management of risk to good governance and to responding appropriately
and enhanced returns to social and environmental issues. www.oldmutual.com/rb
4
for shareholders
South African National Development
Plan (NDP) 2030
Fiona Reynolds The South African Government has set ambitious goals
Managing Director, Principles for poverty reduction, economic growth, economic Long-term growth and investment
for Responsible Investment requires a shared vision, trust and
transformation and job creation.
cooperation between business,
Through our focus areas of financial education and
responsible investment in the green economy and labour and government2
socio-economic infrastructure, we are aligned with
the NDP; and committed to working with others in
civil society and across the private and public sector
to building a prosperous and equitable South Africa.
1 FTSE/JSE Responsible Investment Index in October 2015
2 “Our future – make it work. National Development Plan 2030
Executive Summary.” National Planning Commission.
Given Old Mutual’s longstanding excellence in the JSE SRI
Index, we look forward to seeing how the Plan enhances their
performance in social and economic management
Corli le Roux
O L D M U T UA L P LC Head of Sustainability, Johannesburg Stock Exchange (JSE)
P O S I T I V E F U T U R E S P L A N 2 015Creating a positive difference 11
By focusing on financial wellbeing and
responsible investment, we are addressing
the areas where our business can specifically
82%
of retirement savers say responsible
make a positive difference as well as create investment principles are important
strategic commercial gains. when investing retirement money
As well as managing risk created by
Building trust with our customers
THE BUSINESS We will drive growth in our business by
changes to the environment, we see
opportunities to develop solutions that
continuing to build trust with our customers.
CASE FOR We believe one of the ways we can do this
benefit the environment, our clients
and our bank
OUR POSITIVE is to help our customers increase their
financial literacy through financial education.
FUTURES PLAN By providing this alongside our services and
products, we are helping customers to make Mike Brown
Chief Executive Officer, Nedbank
informed decisions for their short- and long-term
We have built a strong case for financial wellbeing.
our Plan; we are clear that we
can capitalise the business We believe we will also be in a leading position
to attract new customers as trust in financial
opportunities it offers to
232,000
services begins to be rebuilt. With large numbers
ensure outcomes which will of people currently excluded from financial Driving growth in the low
create sustainable benefit services, we have an opportunity to increase carbon economy
for our stakeholders while our share of the market by becoming the Research demonstrates that over the coming People
creating competitive most trusted provider of financial education years as our environmental and societal
advantage for Old Mutual. and helping people to change their financial needs change, there will be increased lending
behaviour for the better. With improved insight opportunities in the green economy and
into the future challenges of society, we will socio-economic infrastructure. We are placing Participated in OMEM’s
develop and offer more and different products Old Mutual and our customers in a position to financial education
to meet people’s changing financial needs. benefit from a share in this growth by focusing programmes in 2015
on these areas and incorporating environmental,
Read more about our social and governance (ESG) issues into our
Positive Futures Plan at:
investment and ownership decision-making.
www.oldmutual.com/rb
We have harnessed our investment skills to invest
Group and customer capital which deliver attractive
returns while empowering communities
Ralph Mupita
O L D M U T UA L P LC Chief Executive Officer, Old Mutual Emerging Markets
P O S I T I V E F U T U R E S P L A N 2 015THE BUSINESS CASE Managing risk Building reputation 12
-13
FOR OUR POSITIVE With a long-term view of the challenges With strong leadership for our Plan and
FUTURES PLAN facing the world in which we operate, and a through engagement with our employees,
CONTINUED commitment to tackle the big issues relevant we can continue to build on our solid reputation. Net trust in the banking
to our business and stakeholders, we are Our bold approach adds additional purpose and financial industry2
ensuring that Old Mutual is prepared to to our employees in their daily activities and
respond to change. For example, the changing long-term plans with Old Mutual, and helps
Working with others and economic value placed on resources that for differentiate our proposition to attract
creating powerful partnerships so long have been considered abundant in talented individuals.
leads to shared and reduced supply may create risk for some business We have an exciting opportunity to move
risk. Our chosen partners models. By building our awareness of external Old Mutual into a strategic position in our sector
can share with us their changes, we can take longer-term business and to positively respond to the changes we all
experiences, knowledge, shaping decisions, reduce risk and maximise see around us. We are clear that if we do this,
skills and understanding opportunities in such developments as it will create business benefits that will help us
of international and local carbon pricing and valuing water. continue our long heritage while helping our
challenges to help us all customers to thrive by enabling them to achieve US$1 trillion of additional
scale-up and deliver on lifetime financial goals. By investing funds in investment in new green
our commitments. ways which help secure a positive future for infrastructure in energy,
our customers, their families, their communities transport, buildings
and the world at large, we are contributing to and industry is estimated
a more positive future for us all. to be needed annually
to 2030
Decline in global reputation
of financial services1 World Economic Forum
0
OUR RISK MANAGEMENT
CONSIDERS: CAPITAL -5.0
EARNINGS, LIQUIDITY
AND REPUTATION -10.0
Read more about how
we manage risk at:
-15.0
www.oldmutual.com/
reportingcentre -20 2001 2003 2005 2007 2009 2011 2013 2015
1 GlobeScan Radar Study 2015, covering 19 countries, 2 GlobeScan Radar Study 2014 of 20,000 citizens across
valuing the reputation of financial services 20+ countries; those who trust minus those who distrust.
Our global research highlights that the finance industry
needs to address public concerns about ethical behaviour by
becoming more transparent. This is the only way the sector
can rebuild trust and reputation among its stakeholders
O L D M U T UA L P LC
Chris Coulter
P O S I T I V E F U T U R E S P L A N 2 015
co-CEO, GlobeScanSOME OF THE WAYS
13
WE ADDED VALUE ACROSS
AFRICA IN 2015
INVESTING IN D E V E LO P I N G
INFRASTRUCTURE1 COMMUNITIES
DEVELOPING
Affordable Other Renewable Broad-Based Community
COMMUNITIES
Education
housing infrastructure energy Black Economic investment funding
R10.2bn 2
R57bn R60.5bn 3 Empowerment R175m R116m
ownership
R16.1bn 4
All figures refer to Nedbank and Old Mutual Emerging Markets as at December 2015. All figures quoted in South African Rand. 3 Committed investment
2 Invested by the end of 2015
DEVELOPING
1 Invested by Old Mutual as custodians of our customers’ money 4 Net value created from Black Economic Empowerment transactions between 2005 and 2015.
COMMUNITIES
We are proud of our heritage in Africa and the
positive impact we have on the lives of our customers,
their families and wider communities
Bruce Hemphill
O L D M U T UA L P LC Group Chief Executive
P O S I T I V E F U T U R E S P L A N 2 015Highlights
THE DIFFERENCE OUR 14
PLAN WILL MAKE
from the year
THE POSITIVE The impact we have made to date
The Plan is already embedding into the business. Since its
IMPACT WE launch in August 2015, we have grown strong partnerships
to drive it forward and implemented key initiatives. The case
ARE MAKING studies that follow demonstrate the tangible positive impacts
that we have made to date. Delivering innovative products Providing financial education
and services to meet the to equip people with the tools to
Over the year we have been Going forward changing needs of society and make sound financial decisions
developing our Positive Futures We will continue to strengthen partnerships and initiatives to give more people access to and plan for their financial
Plan. We have conducted where we make positive impacts. For example, with a range of financial services. wellbeing in the future.
research, asked our Opportunity International we are testing education
stakeholders what they expect tools for customer use and digitising our financial
from Old Mutual beyond our education programmes.
core business, and given much With the World Business Council for Sustainable Development
consideration to how we want and the Investment Leaders Group, we are working on
to create lasting, positive a number of projects including sustainable agriculture, the
impact. true value of reporting and embedding environmental, social
and governance practices and to help grow our share of
investment opportunities in a low carbon economy.
We are establishing a common approach to measure Being held to account by Investing in renewable energy
the impact of our Plan – to help us report progress against stakeholders, who will be to support the transition to a
Read more detail our six goals. Our aim is to report not just what Old Mutual able to review progress against mixed-energy, resource-efficient
on the stories featured has delivered but what the effect is for our business and the our goals, as we commit to and socially inclusive economy.
and others at: long-term benefit to society. being transparent about the
Plan’s progress.
www.oldmutual.com/rb
We have established solid foundations in the core principles of responsible
business, from environmental management of our buildings to employee
wellbeing. We are now looking broader to help address social and
environmental issues which affect wider society
O L D M U T UA L P LC
Helen Wilson
P O S I T I V E F U T U R E S P L A N 2 015
Group Head of Responsible BusinessFinancial Samrit Academy, Ghana
Financial solutions
15
education for schools
Working in partnership with Opportunity
International, we are helping to increase
access to capacity building loans and
FINANCIAL Why it matters
There are 350 million adults in sub-Saharan training for Kenya’s growing number of
low-cost schools. Operating through our
WELLBEING Africa. More than half have no ready access
to financial services, and financial knowledge Faulu Microfinance Bank, the product will
fuel the growth of Kenya’s schooling market.
could be improved across all our markets.
Through the partnership, over 900 schools
Financial education is Earning trust will access loans resulting in improved
the gateway to financial We are working to ensure that our 64,000 access to quality education for over
inclusion. We are enabling employees and 18.9 million customers 400,000 children.
growing numbers of have access to the best financial education www.opportunity.org.uk A school receiving financial solutions from Opportunity International
people to make informed available and feel equipped to make
decisions when using responsible and appropriate financial London, UK
financial services. decisions that will help them prosper.
By 2020, we want to bring meaningful Ready for the future?
financial education to 50 million people.
One of the ways of achieving this goal is by
building accessible education into every point The UK has a savings gap: people are not
of customer contact to help them make saving enough to secure their future. Research
informed financial decisions. we commissioned found that people are
overwhelmingly short-term in their views.
These are our future markets The main purpose of wealth, people said, is
We are committing substantial resources to to support family and pursue opportunities,
this. We aim to be seen as the most trusted experiences and interests. So through our
provider of financial education, wherever financial education and advice service, we are
Read more detail on the we operate – particularly in our African
stories featured and others at: markets where the need is greatest. These now encouraging people to give more thought
to what they will need in later life.
large, mostly financially excluded markets
www.oldmutual.com/rb have future potential for business growth. www.oldmutual.com/rb/reports
Jane Goodland, Responsible Business Director, Old Mutual Wealth
350m Adults in
50m
People we aim to reach through
sub-Saharan Africa financial education by 2020
O L D M U T UA L P LC
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WELLBEING
CONTINUED Financial 16
inclusion
Why it matters
Education is only part of the solution. People also need access
to suitable products.
New ways to meet financial needs
The South African Government has been encouraging new approaches
that bring financial services to underserved communities. In response
we have launched Imbizos which are community-based providers of
financial services offering Nedbank, Mutual & Federal and Old Mutual
products in mostly rural and financially excluded areas. They have
helped us develop new products to meet the needs of rural
communities, such as affordable livestock insurance. Acquisitions such
as Faulu in Kenya have strengthened our ability to offer innovative
micro-finance solutions.
Partnering to drive change
In Africa, we are seeking partnerships with non-governmental
Kitale, Kenya organisations (NGOs) who have existing inclusion solutions that we
can help to scale-up. In the UK, we are working with partners to better
Protecting understand our customers’ financial needs and earn their trust.
vulnerable societies Technology offers exciting new opportunities. Through partnerships
For many of the people who most need with mobile operators and technology companies we aim to improve
access to both products and financial education.
insurance protection, it is simply Read more about
unavailable. As one of eight founding our Imbizos at:
partners of Blue Marble Microinsurance,
we want to change that by collaborating www.oldmutual.com/rb
Smallholder farmer in Kenya
with others to give vulnerable societies
access to insurance. In Kenya we protect
farmers from the impact of adverse
weather conditions such as drought and
excess rainfall. Through our Blue Marble
partnership we will extend our reach to
other parts of Africa.
https://bluemarblemicro.com
50%
of people are excluded from financial
services in many of our markets
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WELLBEING
CONTINUED
Raising the
standard.
In 2013 there were only
787 pupils, now there are
1,161 at the school. This shows
us the impact the school is
having and that the community
is noticing what’s happening.
They are saying to us ‘we want
our children at your school’
King Williams Town, South Africa
Mr Adonis
Acting Principal, Richard Varha Raising the standard
Secondary School
In 2013, we challenged ourselves: could
we significantly improve the Grade 12
maths and science results in South African
Pupil at Richard Varha Secondary School, South Africa public schools? Not just for a privileged
few, but for 250 schools across 10 school
circuits. We are working with Government
officials and education trade unions,
harnessing our collective capabilities to
reach 250,000 learners over seven years.
www.dogreatthings.co.za
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green economy
RESPONSIBLE and infrastructure
INVESTMENT Why it matters
Addressing environmental, social and
Our responsible governance factors in our investment and
ownership decisions makes good business
investment initiative is sense. This long-term approach adds value
a game changer – in our to all our stakeholders and means that the
contribution to sustainability, investment decisions we make today take into
and in shaking up the account the wellbeing of future generations. Cape Town, South Africa
competitive landscape
across all our markets. Funding a greener future Generating energy and jobs
We have funds that are specifically focused
on infrastructure, renewable energy and By the end of 2015, we had committed
housing. By the end of 2015 we had invested
R10.2 billion* in affordable housing projects. R60.5 billion of our customers’ money in
A further R57 billion* was invested in other renewable energy projects, which also
infrastructure projects including schools aim to drive job creation and enterprise
and sustainable agriculture. Through development in surrounding communities.
Old Mutual Investment Group and Nedbank, One such project is the 66 megawatt
we are a leading participant in the South Hopefield Windfarm, developed by
Read more about African Government’s renewable energy Old Mutual Alternative Investments
our approach to
responsible investment: programme. This will help the country’s through its ‘IDEAS’ and ‘AIIM’ suite of funds.
transition to a mixed-energy, resource-
www.oldmutual.com/rb/
efficient and socially inclusive economy.
responsibleinvestment www.oldmutual.com/rb
* Old Mutual Emerging Markets and Nedbank. Left: Doug Thompson, Head of Investor Relations, Old Mutual
Alternative Investments. Right: Patrick O’Sullivan, Chairman
O L D M U T UA L P LC
P O S I T I V E F U T U R E S P L A N 2 015RESPONSIBLE London, United Kingdom 19
INVESTMENT
CONTINUED Collaborating to invest
responsibly
We can build a better business faster if we work
together. When we bring together skillsets, insights
Embedding
and experiences from our different businesses,
Making it transparent we create greater impact. This is already delivering
We want to make it easy for customers results in our drive to be a leader in responsible
to know where their savings are being
responsible
investment. Our Responsible Investment team, based
invested. We are currently working with in Old Mutual Investment Group, partners with teams
key stakeholders on how best to use the across the Group – and organisations such as the
investment
industry’s emerging system of fund Principles for Responsible Investment (PRI) initiative
ratings for responsible investment. and the Investment Leaders Group – to embed
Spreading the word our responsible investment approach across our
We actively contribute to the debate international businesses. Responsible investment
Getting it right on responsible investment through our stakeholders convened to exchange ideas and
To support our drive for best practice involvement in initiatives such as the UK network at the 2015 PRI in Person conference,
in responsible investment, we constantly Sustainable Investment Forum and the where Old Mutual was a gold sponsor.
monitor our compliance with our Responsible Code for Responsible Investment in South www.oldmutual.com/rb/responsibleinvestment Jon Duncan, Head of Responsible Investment
Investment Standard. We aim to be active Africa. We have played an active part in the
and engaged investors: our South African drafting of South Africa’s King IV Code on
asset manager has met our target of casting Corporate Governance, and have supported
100% of proxy votes, and we are making the development of the Africa Directors
good progress across the rest of the Group. Programme in conjunction with the University It was fantastic for Old Mutual to be supporting
A proxy vote is where we vote on a company of Stellenbosch Business School and INSEAD. the PRI for the third year in a row. The event
resolution at the Annual General Meeting continues to provide the best annual opportunity
(AGM) on behalf of the people who have to listen to and engage with thought leaders on
delegated that responsibility to us. material and emerging ESG issues
Jon Duncan
Head of Responsible Investment, Old Mutual
79%
of Group proxy votes cast in 2015
O L D M U T UA L P LC
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INVESTMENT
CONTINUED
Affordable
Housing
Green affordable housing integrates
Cape Town, South Africa social and environmental sustainability
Building for the future imperatives providing access to better
quality homes with lower running costs
for lower middle income groups
By the end of 2015, Old Mutual had
invested R10.2 billion in affordable
housing projects. Our Housing Impact Manie Annandale
Head of Affordable Housing Development Finance,
Fund South Africa (HIFSA) aims to Nedbank
address the housing backlog in the
affordable income segment of the
market. The fund finances the
construction of homes for sale and
rent that are affordable to the lower to
middle income markets. During the year, Lukholo Mlisana and Mike Mannix, Investment Professionals,
Old Mutual Development Impact Funds. Construction of Buh-Rein Estate
Nedbank also facilitated the provision
of over 4,000 new homes. This includes
their agreement with the Green Fund –
delivering funding for 400 affordable
energy and water efficient houses in
South Africa.
www.oldmutual.com/rb
O L D M U T UA L P LC
P O S I T I V E F U T U R E S P L A N 2 015You can read more about Old Mutual’s positive impact at www.oldmutual.com/reportingcentre – Our Annual Report & Accounts 2015 – Adding value to Africa Report 2015 – Nedbank Group Sustainability Review 2015 O L D M U T UA L P LC P O S I T I V E F U T U R E S P L A N 2 015
Old Mutual plc Registered office: www.oldmutual.com
Registered in England and 5th Floor
Wales No. 3591559 and Millennium Bridge
as an external company House
in each of South Africa 2 Lambeth Hill
(No. 1999/004855/10), London EC4V 4GG
Malawi (No. 5282),
Namibia (No. F/3591559)
and Zimbabwe (No. E1/99)
Cover images Designed and produced by MerchantCantos
www.merchantcantos.com
Smallholder farmer in Kenya
Principal at Maloney’s Eye Primary School, South Africa
Pupil at Richard Varha Secondary School, South Africa
Doug Thompson, Head of Investor Relations,
Old Mutual Alternative Investments. Patrick O’Sullivan, ChairmanYou can also read
