Legal General has announced today that it is one of 35 global businesses working with the Organisation for Economic Co-operation and Development (OECD) to join Business for Inclusive Growth (B4IG), launched today by President Macron at the Élysée Palace. Legal General will be part of a coalition of 35 leading international companies that have committed to step up business action to advance human rights throughout their value chains, build inclusive workplaces and strengthen inclusion in their internal and external business ecosystems. In doing so, the objective is to advance G7 government-led efforts to strengthen equality of opportunity, tackle regional disadvantages and fight gender discrimination.
Inclusive Growth is expected to be a signature policy from the French Chairmanship of the G7 taking place over August 24th and 25th in Biarritz. A unique partnership between the OECD and business, the B4IG is a coalition of companies joining forces to fight inequality and deliver social impact. Participating global businesses with a combined market worth of over $1 trillion and over 3 million employees, have pledged their commitment at today's launch, with a three-year project to follow, including a global inclusive growth accelerator and fund.
Nigel Wilson, Chief Executive of Legal General said, "The joint G7-OECD-Business collaboration to deliver Inclusive Growth is closely aligned with our own platform of Inclusive Capitalism. Delivering shareholder value and furthering social progress are not mutually exclusive. It is the opposite for companies to prosper in the long term, it is imperative that they be socially as well as economically useful. With more money to invest globally than ever before, businesses can both generate returns for customers and shareholders and move from measuring the gaps in our society toward closing them. Given our track record delivering in this area, we're delighted to be working with like-minded global firms to support this initiative."
This ground-breaking public and private sector collaboration across the G7 nations provides a unique opportunity to make a pledge to tackle inequalities and drive forward opportunities of inclusive growth. The organisations will work with the OECD across three key areas: securing basic human rights, building inclusive workplaces and strengthening inclusion in company ecosystems and value chains. This includes impact investing, active ownership, and environmental, social and governance (ESG) principles. As the largest institutional investor in the UK, Legal General joins a like-minded global businesses coalition. From shareholder activism to direct investment strategies, Legal General has been recognised as combining growing shareholder value with social progress to advance human rights.
"Delivering shareholder value and furthering social progress are not mutually exclusive."
- Nigel Wilson, Legal General Chief Executive
A focus will be on experimenting, replicating or scaling-up inclusive business solutions from B4IG companies to deliver social impact and drive social progress. Legal General has been driving forward a strategic focus on developing these opportunities and will be sharing its experience of successful delivery of inclusive growth.
Examples include:
- In April, Legal General announced a new and innovative partnership with Croydon Council, investing £44.6 million investment into providing 167 homes for homeless families with rents set at Local Housing Allowance levels. With waiting lists for UK affordable homes reaching over 1.1 million, Legal General is delighted to be creating a blueprint for institutions and the public sector to work together to tackle the UK's housing crisis and the inequality it creates through our Affordable Homes, Later Living, and Build to Rent programmes.
- In 2017, Legal General invested in Salary Finance as part of its commitment to building a better society and improving the financial resilience of all employees and Salary Finance now reaches over 1 million employees across a range of sectors. The business aim is to accelerate an employee's journey from debt to savings, and in doing so, improving their financial and mental well-being, and their engagement at work. Salary Finance offers financial education resources and tools; low interest employee loans to help employees replace avoid high interest debt, enabled by repayments being collected from payroll; and a suite of salary linked savings products, designed using behavioural science, to make saving easy by deducting directly from salary.
- In Manchester and Salford, L&G's Future Cities programme has seen £1 billion invested in a range of projects, including the huge Media City development, which has become a key broadcasting and media hub in the UK. Our strategy also involves new "Build to Rent" projects, which will help tackle the shortage of good, affordable accommodation in Greater Manchester, where the population is expected to grow by 14 per cent over the next 20 years. L&G has also helped support the development of new science and technology centres in Greater Manchester, including the cutting edge new Bruntwood SciTech Bright Building in the heart of Manchester's science park.
- L&G has committed £400 million to transforming the heart of Cardiff in a joint venture partnership with the City Council and local developer Rightacres. The ambitious project will provide 1.4 million square feet of mixed used office and residential accommodation, including BBC Wales' new headquarters. The initiative has is set to create 10,000 local jobs and has helped create significant economic growth in the Welsh capital.
- In Leeds, L&G has invested nearly £650 million to help build new infrastructure across the city, including an innovative modular housing factory, which has the capacity to produce up to 3,000 homes per year. There has also been investment in new science and technology centres, as well as commercial and retail buildings. L&G has also helped fund a £55 million Build to Rent development, which is creating new homes to meet growing demand in the rental sector.
"We pledge to play our part in advancing the G7 agenda to reduce inequalities of opportunity; promote diversity and inclusion and eliminate gender inequality; and reduce territorial inequalities."
Notes to editors
The G7 Business for Inclusive Growth is built around three pillars:
1/ Pledge ensuring benefits of economic growth are shared more widely through public-private cooperation
The Business for Inclusive Growth (B4IG) Pledge commits companies to advance human rights throughout their production chains, fight child and forced labour and respect freedom of association. Signatories agree to build equitable and inclusive working environments, including by providing decent wages, promoting gender equality and helping prepare employees for the future of work through training and upskilling programs. The companies also commit to tackling inequalities of opportunity such as those caused by regional disadvantages by supporting community development programs, strengthening inclusive sourcing and expanding access and affordability of basic services.
The companies (1) will commit specifically to a three-year programme aimed at advancing the ambitions laid out in the pledge. Underpinning the pledge is the view that such engagement is not just good corporate citizenship but is the future of successful business. Business benefits from more inclusive growth models through a more educated and engaged workforce; a larger middle class of consumers with greater purchasing power; more stable operating environments; and a high level of trust from employees, customers and stakeholders.
2/ Business for Inclusive Growth (B4IG) Incubator of innovative public-private projects: a platform where companies can incubate, share, scale-up and replicate new inclusive business approaches.
The B4IG incubator will act as a laboratory to test social innovative projects, extract lessons and promote effective solutions, offering models and impact measurement frameworks to ensure micro-economic action can inform macro-economic policies at G7 level.
B4IG members have already earmarked around 50 projects to the platform, mobilizing more than 1 billion USD in private finance and benefiting close to 100 million people to date. Through B4IG, they will look to leverage these projects to strengthen their collective social impact worldwide.
Certain projects will be accelerated, scaled or replicated through the B4IG incubator, leveraging collaboration with other coalition members, philanthropic organizations and the public sector. In addition, companies will share learnings from projects that are already underway and that can serve as inclusive business models to be emulated or replicated. Among the projects earmarked are schemes to tackle homelessness, help the unemployed back into work and improve access to basic services such as finance and transport in deprived and remote regions in G7 countries.
3/ An inclusive Growth Financing Forum to bring synergies between financing streams
B4IG members will also establish an Inclusive Growth Financing Forum, to catalyze innovative, hybrid financing for social impact, and to assess how to build greater synergies between private, public and philanthropic funding streams. The Forum will look at how to test and expand promising financing mechanisms such as results-based financing, through the B4IG incubator.
About Legal General
Established in 1836, Legal General is one of the UK's leading financial services groups and a major global investor, with international businesses in the US, Europe, Middle East and Asia. With over £1.1 trillion ($1.3 trillion) in total assets under management, we are the UK's largest investment manager for corporate pension schemes and a UK market leader in pensions de-risking, life insurance, workplace pensions and retirement income. We have also invested over £19 billion in direct investments such as homes, urban regeneration, clean energy and small business finance.
About the OECD
The OECD is an international organisation that works to build better policies for better lives. Together with governments and civil society, it establishes standards and seeks evidence-based solutions to a range of social, economic and environmental challenges. The OECD website provides further information on the B4IG initiative and on its work on inequality and inclusive growth.
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