Ben Telfer:

Hello everyone, and welcome to today’s ICMIF webinar, which is episode seven in our mutual advantage webinar series. Today, we’ll hear from UK mutual, Royal London on their case study of how they are putting a purpose driven strategy into practice.

I’m very pleased to welcome from Royal London, Jamie Jenkins and Nadia Al Yafai. Jamie is director of policy and external affairs, and Nadia is head of mutuality and social impact. Jamie, Nadia, delighted you could join us today. And Jamie, I think I’m handing it over to you first.

Jamie Jenkins:

Thank you very much. And my first observation is that the photograph, I think I sent you of me is probably a few years out of date. So you will see me having a few more gray hairs and indeed less hair than I did in that particular photograph, but hopefully it’s a true representation. Yeah, thank you very much.

And by way of introduction, so I have joined Royal London fairly recently. So I’ve come in the middle of some of what we’re about to talk to, but my history does date back with both with this industry and the life and pensions industry, but also with a mutual some 30 years with the previous company. Which spent about 15 of those years as a mutual and about, 15 demutualized as a PLC.

I’ve seen the world from both sides, if you like, in this industry. And it’s quite interesting and very pleased of course, to be returning now to work for a mutual. So really pleased to be at Royal London. It’s worth saying as well, a little bit about the history of Royal London before we delve in.

So it was formed in 1861. I’m not planning to go through every year of its history since then, but in 1861, a couple people got together and decided that it would be a good idea to try and resolve the issues in Victorian Britain around what they called the paupers funeral. So people had very little money and there was very little money available to people when somebody died. And so funerals were a very difficult and [inaudible 00:02:35] affair and they decided it would be good to improve that. And got together and had an afternoon, I suspect in the pub, and at the end of it formed a company, a friendly society as it was at the time. And then some years later in 1908, it transformed into a mutual that it remains today in the form of Royal London.

And today, it is a company. We are the largest mutual life and pensions company in the UK. And probably although we’re not the biggest overall in our sector, we are the large mutual, but we’re also arguably in the top 25 worldwide in terms of assets as a mutual. So we believe we’re a significant force. And therefore that comes with that is significant responsibility. We have almost nine million policies enforced. Just a little bit less than that in terms of the number of customers. We’ve got a bit 4,000 staff and 150 billion or so of assets under management. So we mainly do life cover protection benefits. We do pensions and retirement, and we do investments. And that’s primarily what we do at the moment. So it’s grown a long way since 1861 when a couple of people conceived the idea of protecting people against funeral poverty effectively.

And it’s also worth saying in recent years, the UK, for those of you not in the UK, particularly we’ve seen in the life and pension sector, we’ve seen five or six years of significant policy change, which has given rise to a lot of growth in the sector. So automatic enrollment was the introduction of a policy to get everybody through the workplace into a pension scheme, saving for retirement, which brought about 10 million, 11 million customers into the market over the five or six years leading up to where we are now. But we also had what we call the freedom and choice in the UK, which was the introduction of freedoms in retirement for people to take their pensions. However, they worked relief from the age of 55 and to utilize that money as they see fit, because we came from a regime in 2015, where people had to take an annuity. So they had to buy a guaranteed income for life, and they had no choice in that.

And that shifted in 2015 through policy to allow people to take the money as cash or to buy an annuity or whatever they choose to do. And those two things, automatic enrollment and the pension freedoms gave rise to really some boom years for the industry. And it wasn’t too difficult for anybody established in that to make strides in growing the business. And Royal London was no exception in doing so.

That started to change. And in 2019, ’20 quite from the pandemic, which we’ll come onto, we’ve experienced less in the way of policy change that was driving that sort of business, but equally a sustained low interest rate environment and quite difficult environment for traditional investment strategies, if you like. So more challenging environment coming into that.

In 2020 which of course was a difficult year for a whole host of reasons, but in 2020 we had already set about introducing a new strategy and indeed revitalizing if you like the purpose rethinking and reviewing and having a good look at what our purpose was. And it became clear. I mean, there’s some really important statistics that surround that, there are certainly suggestions that analysis shows that people in a purpose driven company, people working for a purpose driven company, 90% of them are engaged in what you do compared with perhaps 30 or 35% in a company that doesn’t have that clear purpose at the heart of what it does. And there’s also a strong suggestion that that productivity and growth can be two or three times stronger, again, with a firm purpose at its heart. So it was very clear that purpose not just all the good things that were going to come on to talk about, but commercially sensible thing to do in terms of how you grow the business and get everybody behind a really common course.

We spent a lot of time in 2020 thinking about how we might develop the purpose and indeed subsequently the strategy. And one way to do that is to simply get everybody on the board and the senior executive around the table for several days locked away in a room and come up with a strategy and then tell everybody what that is. And tell everybody what the purpose is. That wasn’t our approach at Royal London at all. The chief executive who had arrived some year or so earlier, firmly believed and continues to believe that we need to engage everybody in that. And indeed he set the boat getting everybody to have a voice in that. We had purpose cafes as we called them set up around the business.

Physical areas where people were contributing their ideas towards what our purpose should be, what we stood for and really kind of getting engaged in that process. Many hundreds of our staff participated and engaged with that, which we believe is a clear way of getting people on with what you then want to go ahead and do if you’re part of it. So very much a sort of company wide driven approach to both purpose and strategy. And it was clear at that stage as well, that prior to that, whilst the company always purported to have a purpose, if you asked people in the business, you would get three, four, five different ways of describing it. So getting a singular version of that truth was fundamentally important.

And indeed, as you can see on the slide here, one of the key sentence we came up with, which describes our purpose in a nutshell, is that we want to protect today, invest in tomorrow, and that together we are mutually responsible. And there’s a bit of a play on words across all of that. Protecting today is very much about thinking about the here and now and helping our customers think about protecting, their wealth and their health and their wellbeing and all the things that matter right now. And we offer products that play into that space, but we also offer services that help too.

And indeed, when you think about investing in tomorrow, that’s about not just customers who are investing money with us and particularly for their own retirement, but also about us thinking about how we are investing for tomorrow. And I’ll come on to some of the work that we’re doing around investment, and particularly in terms of climate change and the environment as we go through. And we are mutually responsible. So it’s not a journey that any one person or the board or just us as a company take our customers on, but rather it is something that we are jointly responsible for. And again, in the UK, for those of you not in the UK, we’ve certainly moved to a position where there’s what we call much more democratization of risks.

So there is a greater expectation on individuals to take control of their own finances and their own future wellbeing. And we believe that’s the right way forward. It is a journey that requires people to take mutual responsibility, both in terms of the company that offers you products and services, but for you as an individual. And equally that applies across all of our people.

Our strategy, again, a simple sentence to describe what we want to do. So rather than pages of PowerPoint to try and tell people what we’re all about, our strategy is to be entirely led by the insight. We want to be a modern mutual, and we want to grow sustainably. So again, I’ll come onto a bit about what we’re doing around net zero, of course, like every other company, but growing sustainably in many other ways too. And deepening our customer relationships so that the heart at the middle of this, and it’s a bit of a cliche, but absolutely putting customers and clients at the heart of what we do and developing really relationships with them and the people who also share with them such as advisors to work with them. And we’re not, like every other mutual and those of you on this call would be very familiar, we’re not pressurized by the short term demands of shareholders interested in the quarterly returns, the share price and the dividend.

And I do have, as I say, extensive experience of how one company has spent 15 years when I was there as a mutual and 15 years as a PLC. And the difference is quite stark. It’s not good and bad. It’s just very different. There’s a real distraction when you’re torn by the short term demands of your share price and all things shareholder. But again, everybody on this call will be familiar with that.

We came up with six particular strategic objectives that we want to work to. Purpose driven, first and foremost, that we are driven… It is our kind of north star if you like, in terms of our purpose and the things that we do have to fit within that, or else we have to question why we’re doing them. We want to be data led and digitally nimble, of course, in a world which especially with the acceleration of digital over the last 12 or 18 months in the way that customers want to deal with us, we want to be firmly at the forefront of that space. We’ve got a very strong customer focus, uninterrupted customer focus, if you like, because we’re not torn by other stakeholders. We do want to develop, and we have developed broader solutions. And that’s not just in terms of the products that we offer to people across their life stages in terms of the protection benefits and savings products that we offer, but also the services beyond that in terms of the guidance, the advice that we might point them to with advisors, the help and the communications. And then even through to the emotional support that we might offer people at times of hardship. And again, we’ll, I’m sure, touch on that over the next half an hour or so.

We do want mutually valued relationships. And that is not in terms of how we deal with customers, but also our partners. As I say, we deal a lot through financial advisors who in turn deal with clients and customers, but equally we have many partners just like any big organization, and we want them to be relationships that are two-way and valued rather than any of our partners feeling that we are the big company that places all the demands on them. We want to work with people in a way that’s collaborative. And ultimately we must have, of course, sustainable financials. The fact that we’re a mutual doesn’t mean that we’re not commercial, and of course we have to be. And if we are to deliver returns to our customer which we do, we divert a portion of our profits to customers in the way that many PLCs, of course, return to shareholders. Then we needed to be sustainable and making a profit in order to do that. So we mustn’t take our eye off that ball, and we’re certainly not doing that.

It’s worth just touching on our values. So we put in place a sort of firm set of values that we work to, the things that really matter to us. We want to collaborate. We want to collaborate externally and internally. And for my part, I spend a lot of time working on the policy agenda. And that means I work with politicians, with regulators, and with policy makers and the influencers of all sorts outside of our organization who have different problems, issues, challenges. And it is quite easy for companies in our sector to be quite aggressive and really sort of being critical or cynical of government policy when it doesn’t suit them or suit their business model. Our objective is to think about our customers and how it works for them and our approach with how we engage with policy makers and those that I mentioned, is very much more constructive and collaborative. We want to work together. When government has a aim, it’s probably the same aim as ours in terms of how we help customers. So it’s just figuring a way through that.

We want to be trustworthy and again, if I relate that to my role, so it’s not just about how we work with our people and our colleagues, but in my role, being a trusted guide is being trusted as a force for good. So if I want to persuade a politician that Royal London has something important to say on a matter, and it’s worth listening to, then I need to develop the credibility that Royal London is a trusted guide or a trusted voice in the debate. And is objectively looking at the problem in terms of how we jointly resolve it for customers or people in society generally. And that’s, again, certainly the approach that we take.

We do want to empower people within limits. We want to give people parameters so they feel safe to make decisions within that sort of boundary that we set, but we do want people to feel they can make decisions and they can work with others to do so. And we’ve spent quite a lot of time trying to find that balance, and it is a balance. You can’t have empowerment, which is entirely unfettered, and that tends to breed chaos. But you need some empowerment for people to feel they can actually get on with their job and make decisions. So we’re working hard on that balance and we’ve restructured some of what we do to improve the empowerment across the organization to deliver on the things that we want to do.

And ultimately, we do want to achieve. We want a sense of achievement. We want people to feel that we are doing something meaningful and important, not just as a company that works in life and pensions, but in society, moreover, and that we are genuinely fulfilling a purpose that the people feel is valuable. So again, working quite hard on moving away from just being thought of as a company that sells products for profit and nothing more. And actually the debate around mutuality in the UK is an interesting one in that regard. The mutual sector in the UK is in it for our part by assets, probably seven or 8% of the market, is quite small. Whereas across the world, there are many developed countries where that’s more like 40 or 50% of that. And we’re working pretty hard on that agenda to try and understand why that might be the case. It might be seen as obviously a strategic advantage to us as the largest mutual in a small sector. So a unique selling point, if you like, but I’m more concerned about why the sector ultimately feels that it’s had to go through this period of demutualization for many of the larger companies.

Just to bring to life, before I move on from this slide. I mean, 2020 was clearly a very difficult year for everyone thanks to the pandemic, which still plague us, if you like, today as we try and emerge from it. And so it wasn’t an easy year to do these things. We had fortunately run most of the face to face workshops and engaged people physically in the process prior to the first lockdown in March, 2020, but the work didn’t stop there and it continued. And we worked through the changes we were making and the change in strategy and purpose that we were trying to embed with people despite the pandemic, if you like. Within a week, like many companies, we had everybody working from home. We got everybody set up and we tried to instill, and still do instill a sense of working together despite the geographical separation.

And as a company, we had many decisions to make during the year, which we still executed upon. So in line with our purpose and strategy and just to illustrate that, so we did during 2020 acquire three organizations really, or at least a stake in one of those three and acquire two others. So we bought police and forces mutual. So two other smaller mutual firms in our sector, which we believed had a really a good cultural fit and brought to us basically the kind of products that we were doing with the general public, but in the police force and again, in the army and forces. We felt that was the right thing to do, and it was a way of enabling them to continue under a mutual structure in a way that perhaps they couldn’t at the size and scale that they were operating. And they’re very much now part of Royal London.

We took a take in Responsible Life because we were keen to understand how we could offer equity release to customers. And that was a part in the later life that we knew was a gap for us, though Responsible Life was an obvious partner there, and we’ve taken stake in that we haven’t bought the company in its entirety. And we also acquired Wealth Wizards, which particularly was for the purposes of how we engage the many people who have been brought into automatic enrollment workplace pensions, but not being engaged in the process to being automatically enrolled. And a big part of what they can do is provide guidance and advice to those people as they start to need it. And we realized, again, that was a deficit in our armory which we’ve fully subsumed Wealth Wizards, and we’re now working with them on how we help corporate clients, employers, and their advisors with engaging the workforce and what they have.

A big part of the session of course, is about putting our purpose into action. And we thought about it in terms of using mutuality for good. That’s the way we’ve phrased it. We want to put mutuality at the heart of what we do. We do realize it’s a real differentiator. And also that it kind of comes with a responsibility that I think is not quite as evident when you work for a proprietary business and your chief purpose is supplying returns to shareholders. That’s not what we’re about. We believe that our company’s ultimately owned by our members, and that gives us a different focus in terms of how we use that corporate model in a way that is good for society.

And in thinking about it, we had some of the work that Nadia and others have been doing had come up with a really good strong list of things that we wanted to do in terms of our social impact in society and communities that we work in. And a part of that was to say, “We absolutely want to do those things, but let’s really focus it and make sure it’s based around what we can see are the needs in the relevant areas where we can make a difference.” So being realistic about what our kind of our swim lanes are of influence, if you like, as a company.

So we really sort of rallied around and thought, what are the things that are driving change in society amongst the people that we serve? And climate change was clearly one of the biggest of those and everybody will, I think, agree that it’s to a large extent now, an existential threat. It’s not just an abstract concept that people think about or recycle a plastic bottle in favor of, it’s very much something that’s all pervasive in our thinking about the next 10, 20 years and how we treat the planet. And it’s very evident in what we can see on television every day in the news and what’s happening around the world. So climate change probably chief of those, but in terms of sustainability in our social activism thinking about, we do want to be involved in how we make changes or help with facilitate changes in society. And again, for me, that’s a big part of what we do and I’ll come on to what we’re doing on financial resilience particularly.

We’ve got an aging population. It’s not much of a surprise for me to say that. I think that’s broadly true across most of the world with some blip in some countries, thanks to the terrible events for the last year. But despite that we have generally an aging population across the world. And I actually spent a couple years of my last role working internationally on retirement policy and the aging population, speaking to people in many different countries about what they were doing in terms of pensions and saving and dealing with this very problem with the aging population. It’s quite evident everybody’s wrestling with the same problem, a society that’s moving towards having more people in retirement or more people over 65 or whatever age you want to choose as being old nowadays. And that’s a really big factor. It’s changing the way that the dynamics both in terms of society, but also economically as to how countries operate. So that’s a big deal.

And financial health and wellness and wellbeing, of course, hugely important. I think increasing understanding of the fact that financial wellness isn’t just about the numbers that you see on your bank balance or your credit card, it’s about how you feel and how you feel about your finances and whether it’s something that means you lose sleep every night or something that gives you comfort and can really affect your mental wellbeing as much as it can be a financial problem.

Finally, I talked earlier about the democratization of risk, which is a fancy way of saying we’re transferring risks to individuals. There’s more owners than individual people to think about what their lifestyle would be like in retirement and how they protect their finances rather than it being a function of government or any given company to take care of that for you. And we want to really sort of play into that agenda and think how we can support people.

So those were the kind of drivers. We then have, of course, what we’ve just discussed, which is we are mutually responsible for delivering a good standard living now and for future generations. Now, that’s a bit a twist on just delivering good returns or good products. We’re starting to think about standard of living that people may have. And this plays to the idea of it’s not just about… So take a pension for example, it’s not just about how much people get back on their investments and how good your service is, and whether your communications are clear and indeed how they take money and what guidance and advice they have at retirement, it’s also about the world we live in. And if we bring climate change back into that, and social activism, if you like, society around them will have big impact on their standard of living in retirement, as will the fact that if climate change proceeds as it is unabated, then many people will live in houses that flood every year. Or they’ll live in an area where they can go outside because they air quality is so poor. If we don’t succeed in changing those things, then people’s standard of living, regardless of how good a product may be that the saves into, could be quite adversely affected.

We’re starting to think about standard of living to bring that thinking through in how we deal with customers and design products and propositions for them. And that all fits with our idea of protecting today, investing for tomorrow and being mutually responsible for that outcome.

Finally, I mean, in terms of our purpose and putting it into action, if you like, we’ve thought hard about the key areas that we think we can make difference and how we can use mutuality for good. And the two key things we came up with are building financial resilience, which is increasingly obvious in a post-COVID world where so many families and so many small businesses and individuals have been so adversely affected by the events over the last 18 months, and are having to recover from that. So financial resilience is about many things. It’s about thinking, again, how we help them protect their financials today, their personal finances today, but also thinking about how they invest for the future. Will they have enough money and how will they be supported? And of course, in recent days in the UK, we’ve also had an announcement of the framework for funding social care certainly across England. And that’s a big factor. So more and more people dealing with either themselves or their loved ones or their father or mother being in care and the cost of that, which was largely until now unmet and how people deal with that. So we’re thinking pretty hard about how we support people in that respect.

And that also includes guidance and advice. And again, for those who are in the UK, you’ll be familiar with the term the advice gap. There is a very big gap of people who would benefit from advice, for sure, but are not receiving it for one reason or another. And there’s a whole host of reasons why they don’t seek out advice, whether it’s the cost or the fact they don’t feel comfortable talking about their finances, or they just don’t know what advice was due or when to engage with one. And indeed guidance is similar. We have free guidance available to everyone really in the UK at certain points, provided either by a government service or delivered by providers around the products of the service and particularly on pensions and retirement. But the take up is minuscule compared to what is available and those who would certainly benefit from it.

We have a real problem in sort of joining these things, financial advice and guidance that’s offered versus the demand for it. And there’s real gap in the middle of people who just don’t use it. Now, don’t get me wrong, if everybody in the UK decided they needed financial advice tomorrow, they wouldn’t get it. There are only about 25,000 advisors across the UK. And they will only deal with certain people, but there’s guidance available to everyone. And there are certainly a number of people who would benefit from advice, but don’t seek it out. And I think we need to do a lot in that space. So Royal London’s certainly playing its part in trying to solve that problem. And finally on building financial resilience, just also the emotional support. And again, I think we’ll touch on a few of these things before we conclude, just around how we help people in times of difficulty. And it’s not just about the products that we provide.

And the second element that we came up with was around moving fairly to a sustainable world. So it’s no surprise, I’m sure, to any of you that we’ve committed like most others to net zero carbon emissions by 2050. And there are some companies moving earlier than that in terms of their targets anyway. Whether they’re actually going to achieve them, time will tell. We take a view on that. I mean, let me pause on that just for a second. We do take a view that if you listen to Bill Gates response to this question, why not target 2040, or 2030 for that matter in terms of net zero? And if we all did that, we’d solve the problem sooner. And actually he takes the view, and I concur with it, that we need to be careful that we don’t… This is a very long term problem that we have to solve. And there’s a lot of really difficult things that we need to do in getting there. And if we come up with a target that’s overly ambitious, then there’s a danger that we really focus on the kind of low hanging fruit and the bigger problems that we need to resolve, the big infrastructure questions around how we build things and how we run our cars and use transport and heat our homes, and various other things, change entire industries from one skilled work force to another.

Those are really big things that will take a significant length of time. And to just turn around and say, well, we can go net zero. We could probably do it tomorrow if we just divested in all the companies that had any carbon emissions, then we’d achieve that. But what would be really have achieved all we’d be doing is handing over the stewardship of those companies to somebody else who might be a bit less responsible. We take the view that we want to influence that change. We want to take the time to be involved in the big things that need to be done and to direct our investments accordingly.

So as a company, again, and you could argue, there is a change in purpose of the sector here, certainly having an investment business within our group, our investment business is in essence in many cases, an investor in other companies and holds their shares as an influence on those companies and wants to make a difference. And you could argue now that investment is less about just being the custodian and investor of people’s money in providing returns for their products, but also a steward of good corporate governance. And within that corporate governance is of course the net zero ambition and all things climate change and all things ESG, environmental, social, and governance. So soon to be ESHG, I heard the other day. So health, I think, is going to be a firm part of that going forward.

And the last point on this is simply that we want to do that in a sustainable way, a fair transition, a just transition as it’s formally known. So again, how do we help people along that journey? If somebody’s got to replace their boiler and they don’t have the money to do it, who’s going to fund that? Now, it’s not necessarily the case that we roll it out with our swim lanes to be involved in replacing people’s boilers, but we invest in companies that get involved in doing things like that. So again, there’s a strong connection to the types of things that we need to do. And we care and we engage with companies on how they are thinking about those problems and how they help the most vulnerable customers in moving towards ultimately a net zero ambition.

I’ll stop just there, if that’s okay and I want to give some time to Nadia who can just perhaps… And I have to say she’s been at Royal London longer than me, so she knows a bit more of the history and she can bring to life. She works on our social impact and mutuality and can bring to life a few of the specific things that we’ve been doing and the detail of that. So Nadia, I’ll hand over to you.

Nadia Al Yafai:

Thank you, Jamie. Hi everyone. I think what would be really useful for us to spend a little bit of time on and kind of share with you is how we’ve started to bring that to life. I think one of the things that’s really interesting about the kind of purpose agenda and what mutuality enables us to do is how we drive change in the areas that we can most knowledgeably affect. And what we’ve done with that, especially externally how that’s starting to come about through our brand and through our communications and through our social impact activities. So I’ll spend a few minutes just kind of sharing a few examples of what we’ve done within that space.

And I think one thing that’s a really key message for us is around our mutuality enabling us to take a long-term journey with this piece of work. So it isn’t done and dusted and on a piece of paper. Actually, we are really now going on the second stage of our journey, which is to embed it across every area of our business to really drive change behavior, to enable people to understand each of these purpose areas and how their work contributes to that. So, as you can see on the slide there at the bottom, it says outcome measures, and that’s the piece of work that we’re currently undertaking. And that’s a really robust piece of work to understand how we really live our purpose and kind of embedded in every area of our business.

A couple of really interesting examples of what we’ve done since we’ve kind of really brought this purpose to bear. So we launched a refresh brand strategy to bring our purpose to life around the creative platform called it’s everybody’s business. And we’ve refreshed our visuals off the back of that to really reflect this as a modern mutual, and that had to be an absolutely critical, so changing our visual identity and a new photographic library. And that’s really helped places in that space of a modern mutual but also kind of really demonstrated this kind of step change that the business is taking. And it’s it really landed quite well internally and with our customers as well.

And we’ve brought all that together in a campaign called together for good. So that’s a campaign to protect the standards of living for this and future generations that really aligns to being re truly responsible on these topics. And what that does is helps us tell a story through all our brand work and all our activations around our role in society and what we’re doing. And that helps us pull together all the great activity in this space and kind of gives us that platform to start building on and that narrative. And what we aim for long term is to be able to bring to bear all our proof-points so people can kind of really see how we’re making change.

One really active change that we’ve made is looking at our sponsorship strategy. So in 2021, this has been focused within sports on leveling the playing field. And an example of that is within the ACE campaign, which is part of the cricket sponsorship. So we’re a principal sponsor and partner in Bristol to help black children get involved in sports. We’re also a principal sponsor of a women’s feasibility study, which is looking at the possibility of a women’s line tour within the rugby. Now, those are all kind of really interesting engagements that we’ve had really good conversations with our partners about. What we’re trying to do is come out, we’re tackling this kind of issue of inequality within sports from really new angles and really trying to engage with different demographics and tackle change in quite a deep way.

We’ve also run a really engaging and meaningful brand campaign around grief and tackling the taboo around it. So it’s called loss of words. And the focus on influencers and celebrities really sharing stories of grief, really kind of brought to life the issues around grief and how people are prepared for it or not prepared for it and how it hit them at that moment. And it’s been really an enabler to kind of start a conversation with consumers, particularly during the pandemic, and obviously had to be very sensitively handled, but landed really well. And off the back of that, we’ve got a book called the How to Die Well book, which is downloadable, and it’s full of kind of tips and support around the issue and gives the longevity to the issue. Really shows that we are playing our part in the issues that we are spending time on, and actually thinking about that kind of long-term journey we’re going on with these issues and how we tap into societal issues.

With our social impact work, so I’ve been at Royal London almost six years and social impact has always been at the heart of Royal London. And what is a bit of a pivot for us around our purpose has been, how do we really think about that concept that we’ve been really driving change on around resilience to live shops? But look at a strategic change that we drive around financial resilience. So we’ve actually started to look around the issue of financial resilience from an end to end approach. So thinking about everything from that moment of crisis to prevention, to innovation and building a program of work around that.

So what we’ve done last year is identify a new charity partner. So our charity partner’s called Turn2us. They’re a leading UK poverty charity, and they’re a key strategic partner in supporting at that moment of financial crisis. So their remit is around supporting with accessing grants and benefits at that moment of financial challenge. And so people can go onto their website, around 11 million people do access that on an annual basis and find information. That’s our way of tackling and protecting today. So we’ve kind of really built a social impact program on our partnerships around each of the elements of our purpose.

The next bit is a new program, which we’ve recently launched, which is around how do we drive innovation and invest in tomorrow with future ideas around financial resilience? And that’s called the Changemakers programme, working with social enterprises to drive change and new ideas around this issue of financial resilience. And what’s interesting about that is we’ve identified 10 social enterprises, all at different moments in their journey. And they’re really tackling financial resilience in different ways, not all immediately obvious. So for example, one organization we’re working with works with survivors of domestic violence to empower them and build their financial resilience, but they’re actually a paper flower company. So they make beautiful products out of paper and work with corporates and so on to kind of sell that product. And the other organization, which I think is really interesting is working with refugees to learn to bake bread and build business skills.

I think a really key part of everything we’re doing within our social impact work is around co-creation. So that’s a really key part of this being mutually responsible with other people. We can’t do it alone, so really how we work with our customers and lived experts of people who’ve got experience of issues in terms of how do they help us develop our programs? And we’ve certainly put them at the heart of our Changemakers programme. In fact, we actually chose our changemakers by using the support of lived experts to ensure that we choose the right organizations.

I guess that’s probably all for me right now. I’m happy to answer questions. But I guess in conclusion for me before I hand over to Jamie, army charity has really enabled us to take that kind of long-term view in developing the purpose and engage the business in deep diving into all the elements of the business. And I think hopefully some of the examples we’ve shared started to bring to life that kind of future direction for us. Back to you Jamie.

Jamie Jenkins:

Thanks very much, Nadia. That’s really helpful. And yeah, really back to you, Ben, I guess. And keen to leave time for questions, if anybody has any. You briefly saw the very important information slide there, which of course we have to include, but other than that, just to thank those of you who have joined. And yeah, I’ll pass back to Ben and we’ll see if there’s any questions.

Ben Telfer:

Thank you very much, Jamie. Thank you, Nadia. We do have a number of questions in. Hopefully I’ll get through all of them. In the audience, if you have any further questions, please do type them in now and and submit them and we’ll pose them to Jamie and Nadia. First question, I don’t know which one to go first, first one question here for you.

Jamie, I’ll come to you first for this. It just notes that you have the word mutual in both your purpose and your strategy. How much does being a mutual resonate with your customers and policy holders?

Jamie Jenkins:

Really good question. Not as much as it should is the short answer. I think it’s a really powerful concept being a part of a company, feeling that you have some ownership of that and that the company isn’t distracted by all the things that I mentioned earlier and is very focused on delivering for its customers, is an almost unique, I’m allowed to say almost unique, way of operating a business. And I don’t think that’s truly valued. And that’s clearly not a suggestion that it’s the customer’s fault, it’s our fault and our industry’s fault, I think for not yet getting that strongly across to people. It’s quite a hard thing to define and I do wrestle with this. How do you get across the benefits of mutuality when they are largely intangible?

So apart from the profit share that we pay and that’s significant. Over recent years, we’ve paid over £1 billion back to members. We returned I think 140 million or some think of that order, and during the last year, even despite the last year. So there’s that tangible bit, and that is important of course, a bit like the dividends for shareholders. That’s an important part of what we do. But I think we struggle with the intangibles. I mean, we struggle with describing… I mean, let’s be honest, people in society are, generally speaking, not interested in the corporate governance structure of the company they have a product with, and we shouldn’t try and engage them with that. But I think there is something different about being a mutual in terms of how we operate, how we act and how we fulfill our purpose in society. And that’s the bit that’s hard, and we’re now working very hard on thinking how do we get that across both to our members and customers, but also more broadly from the sector in the UK given its relative decline.

Ben Telfer:

Thanks Jamie. Nadia, anything to sort of add on that from your perspective?

Nadia Al Yafai:

Probably just two things which are, I think there actually is a really interesting place at the moment in society with, whilst people aren’t necessarily interested in engaging in corporate governance structures, actually there is a real understanding of the role of business in society. And being able to articulate that being a mutual enables us to do the kind of things that people are demanding business does, is probably the way we’d be able to leverage that. And certainly some of the things I talked about in terms of the proof points is how do we articulate those proof points so people understand that that’s what mutuality enables you to do?

And I know this isn’t the question, but actually I think what’s really important to say is that for our people our mutuality is absolutely critical. And certainly when we did the purpose cafes and all the workshops, that’s what comes through again and again, is how critical it is for our people and how different working for a mutual feels. And I think actually that’s probably something that is not a product piece, but actually I think it’s something we could share that feeling more. That’s probably something that will bring to life mutuality, because actually working for a mutual. Similar to Jamie, I’ve worked for many other types of organizations, but working for a mutual really does feel very different. And that’s probably something that we could do more of to kind of tell that story.

Ben Telfer:

Nadia, I think you somehow can read the second part of that question because that was a two-parter. And it said, how does sort of being a mutual resonate with your employees? And do they have a sense of pride to work for a mutual company? So you’ve pretty much answered that there, so thank you for that.

I’ve got another question here. Jamie, you touched on it as well about your dividends, the policy holders. The question just asks, what form does that take? Is it for certain eligible customers or products? And is it a historic thing? You mentioned just one billion that’s been given up. Perhaps you could elaborate a bit more on that.

Jamie Jenkins:

Yeah, I won’t try and explain all the depth of the detail, but it is primarily enhancement to the value of people’s policies. That’s how we do it. So we look at our, with profits members, who are the kind of core membership, but also our wider customer base. And we allocate what we think is a fair distribution of a proportion of the profits to each of those as groups by enhancing the value on their policy. So it’s directly sort of paid into their policy primarily pensions. So it’s not given out as cash, to be clear.

Ben Telfer:

And you said one billion over how many years, has it been going?

Jamie Jenkins:

Seven or eight years, Nadia? Yeah, seven or eight. I forget which.

Ben Telfer:

Excellent. A question here. Nadia, I’ll come to you for this one. Talking about your social impact commitments. Do you align these to the UN sustainable development goals?

Nadia Al Yafai:

Yeah. So I’ve been here five years and what we’ve done within social impact is we’ve almost taken a two-fold approach. So when we worked through our social impact, we had 10 social impact commitments that we’ve now subsumed into the purpose impact areas. And the reason I mention them is when we deep dived into those 10 commitments, one of the things we did was align all of those to the SDG. So we are now going through the next stage of that, which is starting to align not just to the SDGs, but actually looking at the indicators underneath them. And I think that is very much the journey of the sustainable development goals, is not just being able to kind of stick one or two of them against one of your purpose impact areas, but actually really think about against the indicators, what are you driving?

So that’s actually part of the next phase of work that we’re doing. So really trying to take our time with that and sure, whoever’s asked the question is aware of how many indicators there are to work through. But yeah, I think it’s actually critical to do that.

Ben Telfer:

Thank you, Nadia. I think we’ve got time for one more question. It simply just asks, was the idea of being a modern mutual really important in how Royal London developed its new purpose and also it’s new brand? Jamie I’ll come to you there.

Perhaps it links to the debate of about mutuality in the UK, and you didn’t specifically say it, but obviously the recent demutualization of LV, which has been discussed in parliament. Was it important that the idea of a modern mutual was what was presented and marketed to customers and to future customers?

Jamie Jenkins:

Yeah, absolutely. At the end of the day, we still compete with the whole range of companies that invest just like ours in their proposition and they will want to be cutting edge and leading just as we do. So our peer group of competitors, regardless of their mutuality or otherwise is a strong field and we need to be modern and modernized in that regard to compete in terms of how we operate in the market. But the other thing, and perhaps more importantly, is that there is still among some the perception that mutuality an outdated concept and that you hear these, others around the call will have heard the kind of notion of a sleepy mutual that kind of rests on its laurels and is based on a kind of older idea of how business is done. And that’s definitely not the case. And in fact, some of the greatest innovations I think are coming now from the mutual sector. And if you look around the world, that’s definitely true. But it’s important in terms about thinking about how we position ourselves as a modern mutual, rather than being categorized as simply a mutual that could be deemed to have an older business model that’s out of date. We don’t believe that’s true, and we want to prove that it’s not the case.

Ben Telfer:

Thanks, Jamie. I’ve just got one more question that’s just come in. It just says, “Nadia, loved your job title, head of mutuality and social impact.” And it asks, “How important is it to link all the sustainability, climate change, ESG work that Royal London’s doing to the idea and the values of mutuality? And is that something that you, again, promote the market that it’s linked so much to your sort of historic values as a mutual company?”

Nadia Al Yafai:

Yeah, I think it’s absolutely critical. And I think the fact that we’re a mutual enables us to have that conversation as a united conversation, but I think for us, that conversation really is driven through our purpose. It’s not about having it on the side in terms of sustainability agenda or social impact agenda. It is really at the heart of everything we do. And I think one of the things that we are really looking to do more and more is how do we embed that across everything we do so it’s very much a kind of behavioral approach and innovation approach. So taking those purpose impact areas does seem really critical to kind of re-embed, but yeah, I love my title too.

Ben Telfer:

Thank you, Nadia. I’m going to close the webinar there. Jamie, Nadia, it was great to hear from you today. Thank you for sharing so much about Royal London’s journey over the past year and this year. And look forward to hearing more about how you embed it across the organization and the outcomes that you use to measure mutuality across your business.

So again, a final thank you to Jamie and Nadia and for everyone for joining us today. I hope everybody is safe and well, and look forward to seeing you again soon. Enjoy rest of your day.

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