INSTITUTE OF DIRECTORS RESPONSIBLE GOVERNANCE AWARD: ASB Bank

The ASB Bank’s success in winning the 2012 Top 200 Institute of Directors Responsible Governance Award is, appropriately, based on its strategic commitment to supporting the communities in which it operates.
The bank’s commitment to community support programmes is longstanding and the effectiveness of the strategy is internationally recognised and benchmarked. ASB invests more than $12 million year in community support activities in New Zealand. The robustness of its current programme is reflected in the results it has obtained from the independent London Benchmarking Group (LBG), an international framework used to measure community investment and involvement.
In the last measured year to June 2011, ASB’s contribution as percentage of pre-tax profit was 1.26 percent. The LBG Australasian member average is 0.6 percent. And the bank’s contribution for every full time equivalent (FTE) employee is A$1686 against the LBG member average of A$392.
The ASB’s Community Support Strategy is board approved and focuses on four key areas of operation, according to the bank’s executive general manager – culture and community, Linley Wood. The areas are education and literacy; youth and families; safe, caring communities; and sustainable community development. The strategy is regularly evaluated against objectives, and the results are benchmarked against brand and spend measures and formally reported to the board.
The bank takes what it describes as “multi-faceted, flexible approach” to community support that combines financial investment, in-kind involvement, functional support and the direct contribution of its people’s time. The strategy is deliberately designed to put focus on the bank’s community support activities and to make “sustainable difference” in those communities.
ASB’s Energy Tracker environmental programme is an example of the bank’s strategy at work. The programme focuses on improving the environmental performance of all ASB’s properties and facilities. According to Wood, the approach “ensures ASB people have meaningful opportunities to make difference to our environmental footprint”.
The bank has measured and reduced its carbon emissions by 2538 tonnes of CO2-e, or 21 percent, between 2008 and the end of 2011. The reduction has been independently assessed by global consultancy Deloitte. Executive leadership teams are responsible for implementing and achieving energy saving targets in their respective business areas and report progress quarterly.
Energy reduction is particular responsible governance focus for ASB. And Wood believes the bank’s “pervasive” energy programme contributed to it receiving the Energy Efficiency and Conservation Authority’s (EECA) Large Business Award for energy conservation in 2012.
Energy Tracker is an online tool that visually tracks energy consumption and savings across every ASB site. “It brings the concept of energy consumption and energy saving to life for our people,” says Wood. The programme shows growing awareness of energy use with some teams in the bank achieving energy use reductions of up to 30 percent.
ASB now plans to encourage other organisations to adopt similar strategies. It plans to launch School Energy Tracker programme. ASB says it is committed to continuing to invest in energy efficiency measures and to embedding energy conservation into everyday business and culture. M

RESPONSIBLE GOVERNANCE AWARD JUDGES’ COMMENTS

WINNER
ASB BANK
SUSTAINABLE COMMUNITIES
The judges were “impressed” with the ASB Bank’s commitment to building sustainable communities. Examples range from ASB making contributions to the community of 1.26 percent of pre-tax profits compared with the Australasian industry average of 0.6 percent, through to the bank’s reduction of carbon emissions by 21 percent since 2008.
ASB Bank’s innovative Energy Tracker system has paid excellent dividends and is now being offered to schools and other organisations. These and other practices provide an outstanding case study of how directors can observe and foster high ethical standards and take lead in meeting the needs of community stakeholders.

FINALIST
AIR NEW ZEALAND
DIVERSITY INITIATIVES
Air New Zealand was Top 200 Responsible Governance Award finalist last year. It is back as finalist this year because the judges were impressed with number of diversity initiatives that the company has focused on and introduced to the business.
The company’s People Development and Remuneration Board Committee has become the People Remuneration and Diversity Committee and updated its charter to confirm the company’s focus and emphasis on the governance of diversity. Air New Zealand recognises that diverse workforce will benefit its stakeholders including employees, customers and ultimately investors.
The key diversity achievements in the 2012 financial year include updating the company’s diversity policy, starting programmes to mentor high potential women, the roll-out of Leaders’ Toolkit for middle management addressing diversity with specific emphasis on unconscious-bias, and providing seminars for women to network and address the challenges of returning from parental leave.
Air New Zealand is focusing initially on gender and ethnic diversity issues. The strategic decision to focus on diversity will, the board believes, help stimulate greater breadth of thought, increased innovation and enhanced customer insights in the enterprise. This in turn will enable Air New Zealand to better service its broad customer base and deliver an enhanced business performance.

FINALIST
VODAFONE NEW ZEALAND
ORGANISATIONAL RESPONSIVENESS
Vodafone is frequent finalist in this Top 200 Award category. That it is finalist again this year is reflection of how seriously the company takes its commitment to responsible governance.
Its entry this year showed how the company responded to the Canterbury earthquakes and the recovery process. It demonstrated Vodafone’s robust risk and crisis management processes. It also demonstrated Vodafone’s ability to understand and address key stakeholder interests while simultaneously focussing on customer needs and building the company’s reputation to continue to deliver stakeholder and shareholder value.
The February earthquake knocked out 55 of the company’s Christchurch area cell sites. This was reduced to 14 within 48 hours. The company deployed ‘cell sites on wheels’ to provide additional network capacity at key sites, including the Civil Defence coordination centre.
It also activated Vodafone Red Alert TXT-based fundraising service following both the September and February earthquakes. It raised $675,015 in donations which it passed to the Red Cross earthquake appeal fund. The company subsequently established the Vodafone NZ Foundation Canterbury Fund and used the foundation’s expertise as an experienced philanthropist to assist the Canterbury Earthquake Appeal Trust (CEAT) to focus on major decisions around grants.

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