How we manage corporate responsibility

We believe that CR is best managed on the ground by the people running our businesses. It is our people who are closest to, and therefore best understand, our stakeholders. However, we are also very aware of the need for good governance, which is why global CR priorities, policies and standards are set and monitored by the Group.

Governance

The Board

Paul Manduca, Chairman, Prudential plc, is the Board sponsor for corporate responsibility.

The Board regularly reviews the Group’s CR performance and scrutinises and approves the Group CR report and strategy on an annual basis.

Group Corporate Responsibility team

The Group CR team is responsible for collating data and information for internal and external reporting; publishing the annual CR report; external monitoring and horizon scanning; overseeing CR risk and issues management processes and benchmarking.

Code of Business Conduct

Consideration of environmental, social and community matters is integrated in our Code of Business Conduct, which is published on our corporate website. Our code is reviewed by the Board on an annual basis and sets out the ethical standards expected of our employees, agents and others working on behalf of the Group. It is in force across the Group and compliance by all businesses is mandatory. It is also integrated within the Group Governance Manual and is covered by the annual compliance certification process. We have translated the Code into Chinese, Korean, Thai and Bahasa.

Stakeholder engagement

We recognise the importance of maintaining a regular dialogue with our stakeholders and responding to their concerns. We conduct regular customer research and measure customer satisfaction. We participate in industry-wide surveys and conduct our own stakeholder research. Our businesses regularly survey their employees. We have frequent dialogue with politicians and other public representatives, and we actively engage with shareholders, analysts and potential investors through an active schedule of investor communications.

External reporting

We publish a summary CR review in our Annual Report as well as this annual CR report, which is available online and in a pdf format. Information about our CR principles and policies, and case studies showing our principles in practice are available on our corporate website.

Supply chain management

Prudential recognises that its own social, environmental and economic impacts go beyond the products and services it supplies to include the performance of its suppliers and contractors.

It is our policy to work in partnership with suppliers whose values and standards are aligned with our Group Code of Business Conduct.

Procurement practices in Prudential UK have been successfully accredited with the Chartered Institute of Purchasing and Supply (CIPS) certification, an industry benchmark of recognised good practice.

Payment policy

It is our Group policy to agree terms of payment when orders for goods and services are placed and to pay in accordance with those terms.

In the UK, we have signed up to the Prompt Payment Code, launched in December 2008 by the UK Department for Business, Enterprise and Regulatory Reform. In 2012, our trade creditor days, based on the ratio of amounts that were owed to trade creditors at the year-end to the aggregate of the amounts invoiced by trade creditors during the year, were 22 days (2011: 22 days).

The Prompt Payment Code and its signatories can be found at www.promptpaymentcode.org.uk

Environment, health and safety

Each of our businesses has a senior representative who provides leadership for environment, health and safety and who attends twice-yearly meetings of our Environment, Health and Safety Council. In a similar way, global operational environment, health and safety issues are addressed through a Health and Safety Forum and Environmental Sustainability Group attended by business unit representatives who have a key environment, health and safety mandate.

In 2012 we retained compliance with ISO 14001 environmental management system standard at our UK sites.

There were no environmental, health and safety breaches in 2012 and we successfully retained compliance with OHSAS 18001 occupational health and safety management system standard at UK sites.

Combating financial crime

Prudential values its reputation for ethical behaviour and for financial probity and reliability, forbidding corruption and the paying or receipt of bribes.

Prudential seeks to comply with high standards of anti-money laundering, counter-terrorist financing practice and economic sanctions in all countries and territories in which we operate. Failure to comply with international standards and Group policies to prevent financial crime, including fraud, could lead to criminal prosecution, fines or reprimands by regulators. Prudential takes these matters extremely seriously and has established strong policies and procedures to manage these issues, including awareness raising and training, record keeping and compliance monitoring.

Overview