Material recycled from Centrica offices (%)

Corporate responsibility

Our businesses are focused on delivering essential products and services to millions of people every day. Continued and sustainable success requires that we accept and respond to our social responsibilities. By understanding our impact on society, the economy and the wider environment, we can develop positive relationships with stakeholders to benefit both business and the community.

Corporate responsibility is integral to all our activities. Our framework is set and co-ordinated by the Centrica corporate responsibility committee that was formed in 2002. Detailed information about our range of corporate responsibility activities is available at www.centrica.com/responsibility.

The effectiveness of our approach was illustrated by Centrica’s inclusion in the 2002 FTSE4Good Index and, for the first time, in the Dow Jones Sustainability Indexes for 2003.

We are aware not only of the positive business potential of demonstrating our commitment to corporate responsibility, but also of the negative impact of poor performance in this area.

Corporate responsibility concerns have been fully integrated into the group’s risk management structures. These address the financial impact on the business of social and environmental threats as well as the potential impact on the reputation of our brands.

Our corporate responsibility activities fall into four main categories:

Environment

Our prime responsibility is managing the impact of our operations on the environment. We also have a responsibility for helping our customers make informed decisions about using our products and services in a way that minimises any negative impact on the environment. British Gas plays a leading role in helping to achieve the government’s fuel poverty and climate change targets through the provision of free or subsidised energy efficiency products. During our Energy Efficiency Standards of Performance (EESoP) programme, which finished in April 2002, British Gas provided 1.4 million energy efficient products to 585,000 households throughout Britain, in total saving 5,250 GWh of energy.

From April 2002, EESoP was replaced by the Energy Efficiency Commitment, a three year programme with an energy saving target of around 27,000 GWh. British Gas is on target to deliver these savings. Key to this success has been our ability to engage customers through new product innovation and groundbreaking customer propositions. Through our Warm-A-Life programme, more than 70,000 disadvantaged customers have received a range of benefits including free insulation products, benefits assessment to ensure that they are claiming everything that they are entitled to and discounts on British Gas energy bills.

In 2002, we worked hard on delivering our environmental programme. Notable improvements included increasing the recycling in our offices from 18% to 34% and improving their energy efficiency by implementing projects that saved more than 4.5 million kWh per annum. In terms of environmental management, sites that were certified to ISO14001 have completed their reassessment and the British Gas Service Centres and AA Service Centres achieved certification for the first time.

We published our second environment report in March 2002.

We also promoted environmental good practice in the home through our ‘Think Energy’ education programme for schools. To date, more than 14,000 primary and secondary schools in Britain have signed up for the programme, involving an estimated one million school children between the ages of 7 to 14. The programme will be extended to include 14 to 16 year olds from 2003. During 2002, ‘Think Energy’ won a British Commitment to the Environment Premier Award.

Community

Our community programme addresses issues relevant to our business and, where possible, we also support our employees’ volunteering activities. Communities will benefit most from our investment if there is a sound business case for it, since this provides the best foundation for sustained involvement.

Centrica community investment

Centrica’s community spend is focused on a number of priority areas, linked to issues relevant to our business.

 

We contributed £5.66 million to community causes in 2002 as measured by the London Benchmarking Group model, which includes both cash and in-kind support.

Our UK charity of the year initiative enables employees across the group to raise funds for a charity chosen by a panel of employees. From April 2001 until July 2002, our partner was the Cystic Fibrosis Trust and our employees raised more than £475,000 to fund vital research and treatment for the UK’s most common life threatening inherited disease. The partnership received an Institute of Public Relations Sword of Excellence award in July.

We hope for similar success with our new chosen charity, the Meningitis Trust. Between its launch in September 2002 and the end of the year, employees raised more than £150,000.

In North America, we launched ‘Direct in the Community’. The programme seeks to play a leadership role in fostering, supporting and encouraging charitable initiatives that provide services related to safe and affordable housing, especially for adults, families, older people and people with disabilities.

The British Gas partnership with Help the Aged continues to support some of Britain’s most vulnerable older people. Since its launch in 1999, British Gas has provided Help the Aged with more than £5.4 million of support and to date there have been 1.6 million beneficiaries of partnership initiatives. The partnership received the Business in the Community Excellence Award for cause related marketing in July.

We have enjoyed a successful association with Carers UK since 1996. In 2002 we sought to identify ‘hidden’ carers and guide them to information, advice and support. Promotion, including a bill message to more than two million customers, also generated awareness among our employees about Centrica’s carer friendly employment policies. Our chief executive is president of the charity.

The AA Accessible Hotel of the Year Awards highlight the importance of ensuring equal access for people with disabilities to hotels and guest accommodation in the lead up to the next phase of the Disability Discrimination Act in 2004. During 2002, AA hotel inspectors assessed 60 hotels and guest houses selected from the results of a detailed questionnaire returned from more than 300 of the AA’s 8,000 strong list. The awards will be repeated in 2003 to make more establishments aware of the need for improved accessibility.

The AA Foundation for Road Safety Research published reports in 2002 on the safety of young male and female drivers, when and why older drivers give up driving and on safety in pan-European tunnels. During the year, research continued on the effect of surface conditions on road safety and accidents on high speed dual carriageways.

In December, it was announced that One.Tel would be working with the Samaritans, the emotional health charity, to promote its new telephone directory enquiries service. During 2003, One.Tel will donate 1p for every call made to the new service generating vital funds for the charity.

Marketplace

We try to take a responsible approach to the marketing and selling of our products and services. We take care of our customers’ daily essentials and provide the necessary access and expertise to ensure they benefit fully from the products and services we offer. For example, we currently provide over 500 communications each day to customers who are blind or visually impaired in the format they require, which includes Braille, large print and audio.

Some of our customers have specific needs. Current services include the Home Energy Care Register, the password scheme, providing information in alternative formats and using access technology such as text phones. We have developed our own website accessibility guidelines based on internationally recognised standards and intend that all our business websites will meet and exceed these standards in the near future.

We have reviewed the needs of hearing- and speech-impaired customers in collaboration with the RNID and the Royal Association for Deaf People. Text phones have been installed throughout the business and the AA has developed a text messaging service so that hearing and speech-impaired members can communicate effectively via their mobile phones.

The British Gas ‘here to HELP’ initiative was launched in 2002 to help tackle household poverty in the most deprived communities in Britain. From a package of £150 million, British Gas’s investment of more than £70 million is supported by additional government and social housing provider funding. Over the next three years, 500,000 homes will be supported in urban, suburban and rural areas through a network of local authorities, housing associations and charity organisations. Households are offered energy efficiency measures and advice along with other services delivered by our charity partners.

Workplace

Relationships with all our employees are based on trust and respect for the individual. We aim to attract, develop, reward and retain high quality people who are motivated to achieve our business objectives. Our employment policies seek to create an environment that motivates and engages all our employees, rewards performance, and satisfies material needs whilst supporting equality of opportunity for all. This is achieved through policies such as family leave, carers, personal development and supporting employees to find a successful balance between work and personal life. A new guide to sound business practice was developed in 2002, setting out how we expect our employees to act in a variety of situations. This is being disseminated in 2003.

The growing diversity among our customers and employees presents us with opportunities for change. In an increasingly competitive environment, it is essential that we recognise the importance of operating as an inclusive organisation, through embracing diversity in the workforce and selecting the very best employees from a wide and varied choice of applicants. We work with a number of partners to achieve this goal including the Employers’ Forum on Disability, an organisation chaired by our chief executive.

Diversity modules form part of the training for all our customer facing employees and a disability awareness training package has also been developed. More than 29,000 booklets giving practical advice on how best to serve disabled people have been issued throughout the business.

We have created employment opportunities for individuals from disadvantaged backgrounds. More than 180 individuals have been employed through targeted recruitment in our contact centres. In July 2002 we received a Business in the Community award for our investment in disabled people as employees and customers.

British Gas has committed to recruiting 200 gas engineers, targeting the long term unemployed and those who have trouble finding a career that fits in with their lifestyle. The engineer training course, developed with the Gas and Water Industries National Training Organisation, includes a part-time option aimed at single parents. The initiative is part of the government backed Ambition Energy programme, chaired by Centrica’s chief executive, to address an anticipated shortage of skilled and qualified gas engineers.

We are delighted that, in recognition of its commitment to the development and training of its employees, the AA has received corporate Investors in People accreditation.

Nearly three quarters of our employees took part in the annual global employee satisfaction survey in 2002, up from under two thirds in 2000. The survey measures four key improvement drivers – customer focus, performance and development, management impact and working life. Part of the performance related element of directors’ remuneration is linked to this survey.

The health and safety of our employees is of paramount importance. Our performance is targeted and monitored through key performance indicators. In 2002, the amount of time lost to injuries or occupational ill health was low. Injuries have been attributable mainly to slips, trips and falls, and our accident prevention programmes focus on the underlying causes of these and other near miss events.

We have also taken steps to protect employees who may encounter violence while they do their jobs, for example gas engineers, roadside patrols and debt collectors. We have launched an occupational road risk programme to manage the risks to employees who drive in the course of their employment. Good practice workshops share new safety techniques and opportunities for performance improvement.

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