Through its understanding of the challenges its customers face and efforts, its social and environmental responsibilities, Leeds Building Society is leading the change in Environmental, Social & Governance (ESG). Node4 spoke to several of the Society’s leadership team to learn more about their efforts.
Node4’s relationship with Leeds Building Society began when they chose us to deliver Colocation Services and migrate all existing equipment, whilst reducing risk and downtime from their previous location. This transition commenced in 2021 with meticulous planning, execution and initial services, which included physical audit, de-racking, transportation and re-racking six full racks in total, with one in reserve.
HOW LEEDS BUILDING SOCIETY APPROACHES ESG
Leeds Building Society is an excellent example of how the financial sector is leading the change in ESG. It understands its fundamental role and responsibility to society, with the cost of home ownership and the cost-of-living crisis continuing to create a very financially challenging environment for its customers. In the face of these challenges, Leeds has refreshed its purpose, which is now ‘putting home ownership within reach of more people, generation after generation.’ This includes supporting ESG ambitions that provide long term value to its owners (who are its members), and setting out clear expectations for its suppliers and other stakeholders.
Understanding what stakeholders care about is crucial, explains Graeme McRitchie, Head of Prudential, Enterprise & Climate Risk: “We perform something called a Materiality Assessment, which helps us find out what our members, colleagues, suppliers and other key stakeholders care about, and what we can improve. We then use the output of the Materiality Assessment to develop and support our ESG strategy.”
Leeds has set itself a target to help 65,000 first-time buyers into a home between 2021 and 2025. Working towards a strategic goal cannot be achieved on your own; it involves the whole business and supply chain, which is why the Society uses EcoVadis as a sustainability platform to monitor their suppliers’ ESG performance. Node4 signed up with EcoVadis in 2021 to support Leeds in achieving its purpose and sustainability goals.
To support its purpose and its wider ESG strategy, Leeds set key business targets, focusing on five pillars, and has made good progress against these so far:
- Supporting Home Ownership – the Society supported 38,000 first-time buyers onto the housing ladder in 2021-2022, compared to a target of 30,000, with a cumulative 2025 ambition of 65,000 as noted above.
- Sustainable Communities – the Society donated £1.4m to charities and communities in 2021-2022 through grants, donations and sponsorship, compared to a target of £600,000 – a new target has now been set of £3m to be donated by 2025.
- Inclusion and Diversity – Leeds improved ethnic minority representation among the workforce in 2022, reaching 11.9% compared to a target of 9.75% and a target for 2025 of 12%. It also increased female representation amongst senior leaders to 35.25% in 2022 compared to a target of 33.5%, with a target of 35% by 2025.
- Climate and environment – Leeds intends to reduce its absolute scope 1 and 2 market-based emissions by 90% by 2030; progress is already ahead of the 10% target reduction set for 2022, with an actual reduction of 19%.
5. Trust and Transparency – the Society maintained a strong colleague engagement and met its target of an average score of 8 out of 10, in line with the UK financial services sector benchmark. It also maintained a high member satisfaction score of 93%, compared to a 2022 target of more than 90%.
The NPS (net promoter score) is also a key indicator of Leeds’ member satisfaction, and a high score and increased promotion of its brand will support its ambition of increasing homeownership.
SUPPORTING CHARITIES THROUGH EMPLOYEE INITIATIVES
Discussing employee involvement and charitable funding, Vanessa Roberts – Head of Strategy & Responsible Business (ESG) explains: “One of the most exciting ESG activities we ran in 2022 was an initiative where colleagues pitched for a share of £250,000 for a charity or environmental project close to their hearts. We raise funds for our charity partner Dementia UK through colleagues participating in activities such as sky diving, competing in the Great North Run, organising raffles or taking part in a dog walking challenge, which is match funded by the Society. Every colleague receives 14 paid volunteering hours and we donate £10 per hour when a colleague gives up their time, whether this is planting trees, or decorating accommodation for Ukrainian refugees.”
Without doubt, Leeds is reaping the rewards of sustainable leadership, supporting its ESG ambitions through setting a clear purpose and specific targets, which lead to improved growth, profitability, member and colleague satisfaction, and support for local communities during financially challenging times.
The technology that Node4 provides Leeds Building Society helps them achieve their purpose and deliver services to customers daily. Creating opportunities and improving the accessibility to make home ownership a reality for so many customers is life-changing – this is change that matters.
This interview was conducted with Leeds Building Society’s Jonathan Utley – Senior Supplier Relationship Manager, Graeme McRitchie – Head of Prudential, Enterprise & Climate Risk, Vanessa Roberts – Head of Strategy & Responsible Business (ESG), Vicky Withey – Head of Compliance and Joanne Jones – Senior Account Manager from Node4.