Legal and General Group

In terms of senior leadership accountability, the responsibility for sustainability issues within Legal and General lies with the board of directors. Moreover, the financial institution links the remuneration of its executive team to sustainability performance criteria. In terms of gender equality and diversity, the financial institution discloses actions it takes to address any pay gaps, such as correcting unexplained differences in pay. It also has targets to increase the representation of women in middle and senior management to 40%, and the total representation of women across the workforce to 50%, by 2022.

Legal and General has set a target of net-zero financed emissions by 2050. In terms of engagement, the financial institution discloses the key companies it has identified as priorities to engage with on climate change, and the rationale for choosing these priorities. It also specifies that alignment with the Paris Agreement is one of its engagement topics. Legal and General Investment Management (LGIM), the financial institution’s asset management division, is a member of Climate Action 100+ so collectively engages with its clients on the topic of climate change. LGIM also requires some of its clients to have a strategy aligned with the Paris Agreement. Legal and General also engages both individually and collectively on the topic of nature and biodiversity. Finally, the financial institution discloses the aggregate amount of finance it devotes to climate solutions while specifying what these solutions are.

Legal and General has a publicly available policy statement committing it to respect human rights and the ILO core labour rights. It also has a grievance mechanism accessible to all workers to raise human rights concerns or complaints. Regarding workforce diversity, the financial institution discloses the proportion of women in its total direct operations workforce for each employee category. The financial institution commits to respecting the health and safety of workers, prohibiting bribery and corruption and protecting personal data, in public policy documents. Finally, Legal and General provides evidence that an executive-level individual has responsibility for its global tax strategy. It also discloses the amount of finance it directs towards SMEs.

There is an opportunity for Legal and General to link the remuneration of its management team to sustainability performance criteria; currently only executive remuneration is linked to sustainability. Legal and General also has an opportunity to reach at least 40% female representation in senior leadership positions. Finally, while Legal and General Investment Management (LGIM) describes its approach to engagement on sustainability themes and impact topics, the financial institution has an opportunity to describe an approach which covers all its financing activities.

Legal and General aims to reduce portfolio greenhouse gas emission intensity by 18.5% by 2025 and 50% by 2030. There is an opportunity for the financial institution to disclose absolute interim financed emissions reduction targets, rather than intensity-based targets, that cover all of its financing activities. In terms of financing for climate solutions, the financial institution could disclose time-bound targets explicitly for its climate solutions. For the group’s proprietary assets Legal and General will not invest in new coal mining, new coal plants or companies that are investing in new coal mining capacity or new coal plants, but it does not disclose that it will not provide any form of finance to any new fossil fuel projects. Regarding nature and biodiversity, no evidence was found that the financial institution is committed to financing regenerative solutions.

There is no evidence that Legal and General describes the process for identifying its human rights risks and impacts through its relevant financing activities. Furthermore, while the financial institution provides a grievance mechanism for raising human rights, as well as bribery and corruption concerns and complaints, it should specify that the mechanism is accessible to external stakeholders. In terms of providing transparency on financial inclusion, while Legal and General discloses that it directs finance towards low-income developing countries, through its Future World fund, it does not provide an amount. Moreover, there is no evidence that the financial institution discloses the amount of finance directed towards women-owned businesses or to another usually excluded group.