CE’s message
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Liberty's top six sustainability issuesWe regard these as the most important sustainability issues facing Liberty today:We believe that we must take care of our earnings and balance sheet, but we should also ensure that the society and environment in which we operate remain healthy. Stakeholders need to believe in the quality of our products and trust that we will deliver in a responsible manner. In short, sustainability must make business sense. Liberty's top six sustainability issues discussed in this report reflect the comprehensive approach we take to running our business. We identified the issues through internal risk assessments, an internal stakeholder engagement process which sought to identify the key issues of a range of our stakeholders, a benchmarking exercise and an executive survey. Given the turbulent times of the last two years, and our reported loss in the first half of 2009, the delivery of sustainable financial results remains a key priority for Liberty. We have clearly outlined three key focus areas for sustainable growth and value - each of which is discussed in detail in the Deliver sustainable financial results section of this report. The first focus area is strengthening Liberty's insurance business, with specific emphasis on addressing persistency. This is going well with persistency levels on target across all insurance business lines and risk lapse rates at their lowest levels for a number of years. The second focus area is achieving excellence in balance sheet and capital management. In this respect, LibFin is delivering on its mandate. Since completing the de-risking of the balance sheet, Liberty has had lower volatility in earnings in unusually volatile markets. As a result, capital requirements are being limited at a time when volatility should be significantly increasing the requirement. Liberty is also still paying a dividend to its investors. The third focus area is diversification in terms of geography and business lines. We remain committed to our long-term vision of transforming from a domestic life assurer to a broad-based wealth management company, both locally and into Africa. Liberty's diversification strategy is gaining impetus with the properties, health, insurance and asset management expansion into Africa continuing as planned. We recognise that in all of these focus areas, and in everything we do, we need to be responsible corporate citizens. As the custodian of a significant proportion of South Africa's savings we are committed to the utmost diligence and integrity. A section of this report deals with the importance we place on governance, ethics, regulatory compliance and engagement, managing fraud and corruption and investing responsibly. In all of these areas we strive to lead by example and contribute positively to the financial services sector, and to the countries in which we operate more broadly. Our customers are at the core of our business and in 2010 we restructured our Retail business unit to ensure end-to-end customer management. We improved our customer research and analytics capability and continued to enhance our products in order to remain relevant in the market. Customer satisfaction remains high and the number of complaints dealt with at a group level has stabilised at 2009 levels (around 4 300). Our people are the driving force behind our success and we continue to provide competitive remuneration and benefits as well as excellent development opportunities. Staff turnover increased slightly this year to 10.6% from 9.1% in 2009. Our focus in 2011 will be on developing and retaining talent. As a large property owner (with R24.6 billion of direct property assets under management), we understand the need to limit our impact on the environment when we develop new buildings, and actively pursue greener methods of development. We have implemented a number of initiatives to reduce our energy consumption in our property portfolio. Despite extensions and refurbishments to the Sandton City, Eastgate and Promenade shopping centres (which could potentially increase energy consumption) we consumed less electricity in 2010 than we did in 2009. Our transformation efforts have produced good results, and we achieved a Level Three Broad-Based Black Economic Empowerment rating in 2010, a year earlier than forecast. We continue to make a positive contribution to South Africa's previously disadvantaged communities through the products and services that we offer our entry level market customers. And our corporate social investment activities continue to focus on education, which is core to the long term stability of South Africa. While our sustainability reporting is guided by the Global Reporting Initiative's (GRI) G3 Guidelines, we have focused on the issues that are most relevant to Liberty. We know that there is still much we can do to contribute to the sustainability of our society and environment, but we believe in reporting honestly on what we have done, and in setting realistic, achievable goals that we and our stakeholders can believe in. |
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| Bruce Hemphill Chief Executive |