We manage a range of sustainability issues as part of our everyday business operations:
- Offering the right products in key customer segments
- Customer satisfaction, engagement and advocacy
- Helping customers in financial hardship
- Fair fees and interest rates
- Lending responsibly to customers
- Access to our products and services
- Healthy franchise partnership model
- Culture and work environment
- Employee engagement
- Workplace health and safety
- Workforce attraction and retention
- Diversity and inclusion
- Remuneration including link to long-term performance
Economic and financial
- Market risk
- Changes to or a deterioration in economic conditions
- Sustainability of housing prices
- Balance sheet strength
- Efficient expenditure and use of resources
- Shareholder returns
Risk, compliance, governance and operations
- Credit risk
- Operational risk
- Ethics and business conduct (including risk culture)
- Identifying and responding to external fraud
- Simplifying processes and procedures
- Climate change and weather events
- Environmental risk of customers we lend to
- Environmental impact of our own property, assets and operations
- Changes in technology
- Digitising operations
- Information and cyber security
- Digital disruption
- Changes in regulation and government policy
- Litigation risk
- Strategic partners
- Stakeholder engagement
- Brand and reputation
- Financial literacy of Australian population
- Community contribution
While all of these sustainability issues are important, our key focus areas and priorities change over time.
To determine the most important sustainability issues for our 2018 financial year, we conducted a survey asking participants to rate the importance of a range of existing and emerging sustainability issues are to BOQ. BOQ’s extended leadership team participated in the survey along with a range of external stakeholders including customers, suppliers, business partners, community partners, analysts and investors.
This process identified four key themes that formed the basis of our sustainability focus areas for the year ahead:
*While the survey did not identify diversity and inclusion as one of our top sustainability issues, it has been added as an additional sustainability focus area for the year ahead because of its importance to our strategy.
Each of the above links provides more information on how we manage these sustainability focus areas. We monitor all of our sustainability issues on an ongoing basis, with the priority areas assessed on an annual basis.
For more information on our performance across a range of customer, people, community and environmental measures, visit our non-financial performance table.
Material business risks
Our sustainability priority areas include both material and non-material business risks, and should be read alongside our material business risks outlined on page 18 of our 2017 Corporate Governance Statement.
Our material business risks include economic sustainability issues such as market and credit risk. Further details on the controls in place for some of these risks are also outlined on pages 103-112 of our 2017 annual report.
Our material business risks also include a number of social sustainability risks such as cyber security, compliance risk, operational risk and reputational risks. More information on how we are managing these risks are available on page 18 of our Corporate Governance Statement and through the above sustainability focus area pages.
While not all of the issues covered in our sustainability focus areas are considered material business risks, they concentrate on social sustainability issues where we have the greatest impact, for example through:
We continue to manage our social sustainability issues through engagement with a number of stakeholders for ongoing feedback including customers, employees and regulators. Our sustainability framework provides more information on how we put customers at the heart of everything we do, operate with strong governance, create a place where our people love to work, engage with the communities we operate in, and responsibly manage our environmental impacts. Support we have provided for our various stakeholders over the past 12 months is also outlined in our 2017 sustainability scorecard.
In our 2017 Corporate Governance Statement we identify that we have no material exposure to environmental sustainability issues that would compromise the health of the ecosystem in which we operate over the longer term. Our physical footprint includes branches, support centres and an energy efficient head office and, as a financial services provider, the output of our own operations has limited direct environmental impacts. Our primary function is gathering deposits from and lending to customers. Our lending activities are guided by an Ecological Care and Sustainability Policy which strengthens controls when lending in a range of industries that have the potential for environmental impact. As at 31 August 2017 our direct commercial lending exposure to the mining industry was less than 1% of BOQ’s total loan portfolio. You can find out more about this on our approach to sustainable lending page. You can also find out more about some of our environmentally friendly initiatives on our environment sustainability page and our 2017 sustainability scorecard.