Environmental Social and Governance

Westpac's approach to sustainability starts with a commitment to serving the needs of customers. Our vision is to be one of the world’s great service companies, helping our customers, communities and people to prosper and grow. We measure and report against a number of indicators to track our progress.

	FY16	FY17	FY18	Commentary	Link to source document
Number of customers (million)	13.4	13.9	14.2		2018 Annual Report (page 133)
Digitally active customers (million)	4.9	5.3	5.6		2018 Annual Report (page 133)
Change in consumer complaints (%) – Australia	-31	-18	12		2018 Annual Report (page 133)
Change in consumer complaints (%) – New Zealand	-7	-21	-16		2018 Annual Report (page 133)
Net Promoter Score (NPS) Australia – Consumer – Westpac Group¹ ²	-0.4	0.9	-6.8		2018 Sustainability Performance Report (page 79)
Net Promoter Score (NPS) Australia – Business – Westpac Group ¹ ³	-8.7	-6.7	-12.9		2018 Sustainability Performance Report (page 79)
Net Promoter Score (NPS) New Zealand – Consumer	+0	+2	+8		2018 Sustainability Performance Report (page 79)
Customer Satisfaction (mean) – Consumer – Westpac² ⁴	-	-	7.2	Prior periods not comparable due to change in supplier	2018 Investor Discussion Pack (page 46)
Customer Satisfaction (mean) – Consumer – St.George brands² ⁴	-	-	7.5	Prior periods not comparable due to change in supplier	2018 Investor Discussion Pack (page 46)
Customer Satisfaction (mean) – Business – Westpac³ ⁴	7.2	7.3	7.1		2018 Investor Discussion Pack (page 46)
Customer Satisfaction (mean) – Business – St.George brands³ ⁴	7.6	7.6	7.6		2018 Investor Discussion Pack (page 46)
Customer Satisfaction (%) – New Zealand⁵	65	66	69		2018 Investor Discussion Pack (page 46)
Customer advocate				Adrian Ahern appointed as customer advocate in Oct 2016	2016 media release

^{1. Net Promoter Score measures the net likelihood of recommendation to others of the customer’s main financial institution. Net Promoter ScoreSM is a trademark of Bain & Co Inc., Satmetrix Systems Inc., and Mr Frederick Reichheld. Using a scale of 0 to 10 (0 means ‘extremely unlikely’ and 10 means ‘extremely likely’), the 0-6 raters (detractors) are deducted from the 9-10 raters (promoters).}

^{2. Source: DBM Consultants Consumer Atlas, September 2016 – September 2018, 6MMA. MFI customers.}

^{3. Source: DBM Consultants Business Financial Services Monitor, September 2016 – September 2018, 6MMA. MFI customers, all businesses.}

^{4. The Customer Satisfaction score is an average of customer satisfaction ratings of the customer’s main financial institution for consumer or business banking on a scale of 0 to 10 (0 means ‘extremely dissatisfied’ and 10 means ‘extremely satisfied.}

^{5. 3 month rolling Retail Market Monitor data (survey conducted by Camorra Research). Main bank customers are asked to rate the overall level of service they receive from their main bank on a scale of 1 (poor) to 5 (excellent). Results represent the % of customers who rate the service as either 4 (very good) or 5 (excellent), excluding “don’t know”.}

Through our Workforce Revolution strategy, we are working to build a future-ready workforce with a culture focused on service and doing the right thing. We measure and report progress on a number of indicators that reflect this focus, including on training, diversity, wellbeing, speaking-up, and employee engagement.

	FY16	FY17	FY18	Commentary	Link to source document
Code of Conduct				Employees complete training on the Code of Conduct	Westpac Group Code of Conduct (PDF 202KB)
Anti-Bribery and Corruption Policy				Employees complete training on the Anti-Bribery and Corruption Policy	Westpac Anti-Bribery and Corruption Policy Principles
Total full-time equivalent employees	35,580	35,096	35,029		2018 Annual Report (page 133)
Women as percentage of total workforce	58%	58%	57%		2018 Annual Report (page 133)
Women in leadership¹	48%	50%	50%		2018 Annual Report (page 133)
Age diversity published					2018 Sustainability Performance Report (pages 76-77)
Supporting employees with accessibility requirements					2017-2020 Accessibility Action Plan
Supporting LGBTIQ employees				First Australian organisation to sign the United Nations LGBTI Standards of Conduct²	2018 Sustainability Performance Report (pages 36)
Addressing wellbeing					2018 Sustainability Performance Report (pages 37)
Aboriginal and Torres Strait Islander new-to-bank hires (%)	3.4	4.5	4.3		2018 Sustainability Performance Report (pages 77)
Flexible workplace arrangements				74% of employees working flexibly	2018 Sustainability Performance Report (pages 36)
Employee training – average hours per employee	17.1	19.3	20.0		2018 Sustainability Performance Report (pages 78)
Employee engagement index	69%	79%	-	Survey completed typically every two years	2018 Annual Report (page 133)
Speaking Up Policy				Whistleblower Policy renamed to 'Speaking Up' and updated in November 2018	Speaking Up Policy Summary (PDF 225KB)
Whistleblowing reporting – total number of new concerns	209	344	289		2018 Sustainability Performance Report (pages 78)
Employee voluntary attrition	10.6%	9.6%	10.0%		2018 Annual Report (page 133)
New starter retention² (%)	85.5%	84.7%	84.1%		2018 Annual Report (page 133)
Lost time injury frequency rate (LTIFR)	0.8	0.6	0.4		2018 Annual Report (page 133)
All Group Executives have signed the Banking and Finance Oath					Banking and Finance Oath

^{1. Women in Leadership refers to the proportion of women (permanent and maximum term) in leadership roles across the Group. It includes the CEO, Group Executives, General Managers, senior leaders with significant influence on business outcomes (direct reports to General Managers and their direct reports) large (3+) team people leaders three levels below General Manager, and Bank and Assistant Bank Managers.}

^{2. https://www.unfe.org/wp-content/uploads/2017/09/UN-Standards-of-Conduct-Summary.pdf}

^{3. Voluntary new starter retention over the new starter headcount for the 12-month period (permanent full time and part time employees).}

As a major financial institution, we recognise we can influence social and environmental outcomes through our lending and investment decisions. This is a responsibility we take seriously and we have in place a number of frameworks, policies and positions that outline our approach to lending and investing. As a result we have become the largest financier to greenfield renewable energy projects in Australia. Westpac has also aligned reporting to the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), in our 2018 Annual Report (pages 124-125, 135-136) and Sustainability Performance Report (page 58).

	FY16	FY17	FY18	Commentary	Link to Source Document
Lending to climate solutions ($bn)^TCFD	6.2	7.0	9.1	Target: $10b by 2020 and $25bn by 2030	2018 Annual Report (page 133)
Facilitate climate solutions (e.g. green bonds) ($bn)^TCFD	-	-	1.7	Target: $3bn by 2020	2018 Annual Report (page 136)
Proportion of electricity generation financing in renewables including hydro – Aust and NZ (%)^TCFD	59	65	71		2018 Annual Report (page 133)
Electricity generation portfolio emissions intensity (tCO₂-e/MWh)^TCFD	0.38	0.36	0.28	Target: 0.30 (tCO₂-e/MWh) by 2020	2018 Annual Report (page 133)
Finance assessed under the Equator Principles – Group ($m)^TCFD	617	891	773		2018 Annual Report (page 133)
Mining as a % of Group total committed exposure^TCFD	1.16%	0.96%	1.03%		2018 Investor Discussion Pack (page 82)
Enhanced lending criteria to existing thermal coal sector customers (calorific value >5,700 kCal/kg)^TCFD	-	-	Compliant	Metrics introduced as part of Climate Change Position Statement & 2020 Action Plan	2018 Annual Report (page 136)
Enhanced lending to new thermal coal mines or projects (calorific value >6,300 kCal/kg)^TCFD	-	-	Compliant	Metrics introduced as part of Climate Change Position Statement & 2020 Action Plan	2018 Annual Report (page 136)
Business lending exposed to sectors that may experience higher risk in a transition to a 2 degree economy (%)^TCFD	-	-	4%	Australian Business and Institutional lending (excludes retail, sovereign, and bank exposures) under a Global Cooperation Scenario	2018 Annual Report (page 124-125 & 136)
Australian mortgage portfolio in postcodes which may be exposed to higher physical risks at 4 degrees of warming (%)^TCFD	-	-	1.7%	Share of current exposure to postcodes that may experience higher physical risk at 2050 under IPCC's RCP 8.5 Scenario	2018 Annual Report (page 124-125 & 136)
Climate-related issues integrated into overall risk management					2018 Annual Report (page 119-120)
Board and Executive oversight of climate change issues				Board oversight: including Six-monthly updates Executive oversight: including Quarterly updates through Sustainability Council	2018 Sustainability Performance Report (page 58)

Direct environmental performance is measured against a number of indicators. These include greenhouse gas (GHG) emissions, energy use, paper consumption, waste and recycling, water use, and business travel.

	FY16	FY17	FY18	Commentary	Link to Source Document
Total Scope 1 and 2 emissions – Aust and NZ (tCO₂-e)¹	154,339	131,723	125,973	Target: 9% reduction from 2017 to 2020, 34% by 2030	2018 Annual Report (page 133)
Total Scope 3 emissions – Aust and NZ (tCO₂-e)¹	63,016	68,415	64,804	Target: 9% reduction from 2017 to 2020, 34% by 2030	2018 Annual Report (page 133)
Paper consumption – Aust and NZ (tonnes)¹	3,304	2,706	2,189	Target: 40% reduction from 2017 to 2030	2018 Annual Report (page 133)
Energy consumption (GJ)¹	848,658	734,787	710,526		2018 Sustainability Performance Report (page 86)
Waste recycled (Tonnes)¹	3,506	3,052	3,355	Target: 80% diversion of waste from landfill in commercial workplaces from 2017 to 2020	2018 Sustainability Performance Report (page 89)
Water consumption (kL)¹	485,354	448,947	377,723		2018 Sustainability Performance Report (page 90)
Carbon neutrality across our business¹					Westpac Banking Corporation Public Disclosure Statement (PDF 2MB)

^{1. Data reflects a 1 July – 30 June reporting year.}

Recognising that the actions of our suppliers are important to our sustainability performance we have a Responsible Sourcing Code of Conduct which helps us manage risks and opportunities in our supply chain. In addition, our Supplier Inclusion and Diversity Policy includes an aspiration to increase the proportion of products and services we source from businesses that are driven by a social or environmental mission, or that support people who have traditionally been financially excluded.

	FY16	FY17	FY18	Commentary	Link to Source Document
Responsible Sourcing Code of Conduct in place					Westpac Group Responsible Sourcing Code of Conduct (PDF 309KB)
Number of suppliers assessed against Responsible Sourcing Code of Conduct	-	31	100		2018 Annual Report (page 133)
Spend with indigenous Australian suppliers - Australia ($m)	1.6	2.5	3.8	Targeting $10 million spend with Indigenous suppliers by 2020	2018 Annual Report (page 133)
ESG objectives included in our supply chain management strategy					Westpac Group Responsible Sourcing Code of Conduct (PDF 309KB)
Publicly available supplier code of conduct and supply chain management approach					Westpac Group Responsible Sourcing Code of Conduct (PDF 309KB)
Slavery and Human Trafficking statement				Westpac’s 2018 statement to be released before 31 March 2019

Our approach to community giving is guided by our social impact framework, which brings our company’s vision to life and focuses our efforts where we are best placed to make a difference. We believe we can play an important role in creating positive social impact through core business activities and community investment.

	FY16	FY17	FY18	Commentary	Link to Source Document
Community investment excluding commercial sponsorships ($m)	148	164	131		2018 Annual Report (page 133)
Community investment as a % of pre-tax profits – Group (%)	1.39	1.42	1.11	Target to maintain >1% (2017-2020)	2018 Annual Report (page 133)
Community investment as a % of pre-tax operating profit (cash earnings basis)	1.32	1.41	1.12		2018 Annual Report (page 133)
Financial education (participants)	59,596	112,263	133,844		2018 Annual Report (page 133)
Number of approved applications for financial assistance from customers experiencing financial hardship	30,759	28,322	37,678		2018 Sustainability Performance Report (page 96)

Westpac's board comprises directors with a diverse range of financial and other skills, experience and knowledge. Apart from the CEO, all directors are non-executive and independent.

	FY16	FY17	FY18	Commentary	Link to Source Document
Independent Chair				Lindsay Maxsted, Chair	2018 Corporate Governance Statement (page 5)
Independent Chair of Remuneration Committee				Craig Dunn appointed Chair in 2017	2018 Corporate Governance Statement (page 5)
Number of independent directors	8/9	8/9	8/9	All directors independent with the exception of CEO	2018 Corporate Governance Statement (page 5)
Independence definition published					Westpac independence definition (PDF 163KB)
Women on board	22%	22%	22%	Appointment of Anita Fung (1 October, 2018), Margaret Seale and Steven Harker (both on 1 March, 2019) lifts the proportion to 36%	2018 Corporate Governance Statement (page 13)
Diversity incorporated in nomination policy				Not restricted to specific forms of diversity	Board Nominations Committee Charter (PDF 298KB)
Board skills matrix published					2018 Corporate Governance Statement (page 7)
Clear board tenure policy					Westpac Group Board Renewal Policy (PDF 31KB)
Average board tenure (years)	5	4	5	Rounded to nearest full year	2018 Corporate Governance Statement (page 7)
Board committees, including responsibilities and membership, outlined					2018 Corporate Governance Statement (PDF 1MB)
Board performance assessed				Board commissions an annual performance review by an independent consultant	2018 Corporate Governance Statement (page 9)
Board performance assessment published				Annual independent review is not published. Results of the performance review are used to recommend directors for election each year	2018 Corporate Governance Statement (page 9)

Westpac’s remuneration strategy is designed to attract and retain talented employees by rewarding them for achieving high performance and delivering superior long term results for our customers and shareholders, while adhering to sound risk management and governance principles.

	FY16	FY17	FY18	Commentary	Link to Source Document
Remuneration policy outlined					2018 Annual Report (pages 48-75)
Introductory letter to remuneration report published					2018 Annual Report (pages 48-49)
Statutory remuneration tables published					2018 Annual Report (pages 69-75)
Actual remuneration received tables published					2018 Annual Report (pages 54-56)
Details of outright and unvested shares held by board and management outlined					2018 Annual Report (pages 72-74)
Minimum shareholding requirements for board and management outlined					2018 Annual Report (pages 65-68)
% of board and management meeting, or on track to meet, minimum shareholding requirements	100%	100%	100%		2018 Annual Report (pages 65 and 68)
CEO performance against objectives outlined					2018 Annual Report (pages 48-64)
CEO remuneration at risk outlined					2018 Annual Report (pages 50, 51, 56, 59)
Malus provision in place					2018 Annual Report (pages 51)
Claw-back provision in place				While clawback of remuneration already paid does not apply, malus adjustments may be applied to both short term and long term variable reward if information comes to light that was not known when the awards were first granted	2018 Annual Report (pages 51)
Ratio of highest paid to median salary published					2018 Sustainability Performance Report (page 78)
Gender pay ratios published					2018 Sustainability Performance Report (page 77)
% of employees covered by collective bargaining agreements published					2018 Sustainability Performance Report (page 104)

Effective risk management across the entire Group is critical to achieving our vision to be one of the world’s great service companies, helping our customers, communities and people to prosper and grow.

	Commentary	Link to Source Document
Board risk and compliance committee		2018 Corporate Governance Statement (page 21)
Group Executive risk committee		2018 Corporate Governance Statement (page 21)
Independent audit function		2018 Corporate Governance Statement (page 17)
Key risks outlined		2018 Annual Report (pages 108-120)
Sustainability Council	Comprises senior leaders from across the business and is responsible for championing sustainable business practices across Westpac Group and driving activities and objectives	Sustainability governance framework
Stakeholder Advisory Council	Forum for a range of external stakeholders to provide important insight and feedback to our executives and sustainability leaders on Westpac’s approach to sustainability	2018 Sustainability Performance Report (page 68)
Sustainability materiality analysis aligned to risk and published in annual report		2018 Annual Report (page 129)

Westpac takes its tax obligations seriously and is committed to paying the right amount of tax in all the jurisdictions where it operates.

	FY16	FY17	FY18	Commentary	Link to Source Document
Tax transparency report published					Westpac Group 2018 Tax Transparency Report (PDF 303KB)
Effective tax rate	29.91%	30.55%	30.96%		2018 Annual Report (pages 89)

Westpac does not make cash donations to political parties. Political expenditure, as set out below, relates to participation in legitimate political activities where they were assessed to be of direct business relevance to Westpac. Such activities include business observer programs attached to annual party conferences, policy dialogue forums and other political functions, such as speeches and events with industry participants.

	FY16	FY17	FY18	Link to Source Document
Political expenditure published				2018 Annual Report (page 46)
Political expenditure – Australia	$196,555	$162,726	$189,195	2018 Annual Report (page 46)
Political expenditure – New Zealand ($NZ)	$0	$2,756	$19,150	2018 Annual Report (page 46)

Westpac supports the United Nations Sustainable Development Goals and their agenda to end extreme poverty, fight inequality and injustice, and protect the planet. We have identified 10 priority goals based on their importance to our stakeholders and business. Priority goals were identified by considering the SDGs in our materiality assessment and by assessing their importance against our business activities, our stakeholders and operating regions.

Our 10 priority goals

Goal 4: Quality education
Goal 5: Gender equality
Goal 8: Decent work and economic growth
Goal 9: Industry innovation and infrastructure
Goal 10: Reduced inequalities
Goal 11: Sustainable cities and communities
Goal 12: Responsible consumption and production
Goal 13: Climate action
Goal 16: Peace, justice and strong institutions
Goal 17: Partnership for the goals

Helping people make better financial decisions	We believe in creating a fairer, more inclusive and confident society by helping people understand money. Our aim is to help customers track and grow their wealth so they will feel more confident with financial decisions no matter their situation. Initiatives include: Delivering products and services that help customers make better financial decisions Implementing financial health check programs Delivering financial capability training programs and resources Providing additional insights to business customers.
Helping people by being there when it matters most to them	We understand that life has its tough moments, and vulnerability is something that can affect anyone at any time. We want to be by our customers’ side and help more people as they go through major life events. Initiatives include: Providing targeted support to help customers recover from financial hardship Making support available to customers experiencing significant life events such as the death of someone close to them divorce or the birth of a child Providing support to communities impacted by a disaster or by major changes in local economies Supporting business customers through transitions, such as family succession.
Helping people create a prosperous nation	Our world is changing at an unprecedented rate, affecting how we all live and work. We want to help more people gain the skills that will be needed in the future, and accelerate how we identify and solve the biggest issues impacting Australia and the world. Initiatives include: Providing our employees with access to learning opportunities to help build the skills needed for the workforce of the future Investing $50 million by 2020 to back the people and ideas shaping Australia Backing the growth of climate change and housing affordability solutions.
A culture of doing the right thing	We are committed to building a culture of care, inclusiveness and high integrity – where it’s expected that all our people demonstrate the values of our company and speak up if something isn’t right. We believe in doing the right thing by our customers, communities and people – grounded in transparency and responsiveness to the concerns of our customers and the wider community
Fundamentals	We are committed to continuing to lead on the fundamentals: the sustainability policies, action plans and frameworks. We are also continuing to report on additional metrics that are expected of a bank committed to sustainable business practices.

Helping people make better financial decisions	Continued to offer a range of products and services to help customers pay down their debts more easily and support their savings goals. Promoted financial capability for different customer segments, including 2.5 million Australians via Starts at 60. Delivered financial literacy programs through Davidson Institute in Australia and the Managing Your Money program in New Zealand.
Helping people by being there when it matters most to them	Announced a $100 million Drought Assistance Package. Donated $100,000 to the Salvation Army Rural Support Services Program and a further $100,000 in Community Recovery Resilience grants. Established processes to assist customers in vulnerable situations earlier in the complaints process for escalation to a high priority resolution team. Announced *Loss of a loved one* tools and resources to help customers and their family managing a deceased estate. Introduced the option for credit cardholders to block transactions from gambling merchants to support customers vulnerable to a gambling problem. Expanded dementia-friendly banking to BankSA and Bank of Melbourne.
Helping people create a prosperous nation	Welcomed the next 100 Westpac Scholars, bringing the cohort to 330. Westpac Foundation Social Scale-up Grants supported social enterprises to create 513 jobs¹ for vulnerable Australians. Awarded Westpac Foundation Community Grants to support 200 not-for-profits. 275 businesses supported through our Many Rivers partnership. Announced 200 Businesses of Tomorrow. Supported eight early-stage companies through the FUELD accelerator program. Published our Science, Technology, Engineering and Mathematics (STEM) Commitment centred on talent incubation, championing change and fostering innovation.
A culture of doing the right thing	Held Navigate employee training to reinforce Our Compass, a framework that brings together our vision, service promise, values and code of conduct. Maintained 50% Women in Leadership roles. Indigenous Australian new hires as a percentage of total hiring was 4.3%. Tailored Talent program developed to remove some of the traditional barriers to work for people on the autism spectrum. One of six employers to attain the highest Platinum status in the Australian Workplace Equality Index for LGBTI inclusion. Established a new Customer and Corporate Relations Division, bringing together customer complaints teams from across the Group.
The fundamentals - sustainability policies, action plans and frameworks	Strengthened management of climate change risk including new scenario analysis. Released BT Financial Group’s Sustainable Investment Approach and signed the UNEP FI’s Tobacco-Free Finance Pledge. Continued to increase awareness to ensure employees are familiar with our Speaking Up Policy. Determined Westpac’s salient² human rights issues and supported the introduction of comparable Australian legislation to the UK Modern Slavery Act. Continued to invest in cybersecurity capability to protect customer information and commercial data. $17.7 million sourced from diverse suppliers. Contributed over $131 million to community investment.

^{1. All results as at 30 September 2018 except ‘jobs created following Westpac Foundation Social Scale-up Grant support’, which is as at 30 June 2018. Refer to www.westpac.com.au/sustainability for glossary of terms and metrics definitions.}

^{2. UN language for Human Rights ‘at risk of the most severe negative impact through a company’s activities and business relationships’.}

Guiding our approach

Principles for doing business
Stakeholder Engagement Framework
Social Impact Framework

Managing Risk

Sustainability Risk Management Framework
Approach to risk management
Responsible Sourcing Code of Conduct (PDF 309KB)

Driving action

2018-2020 Sustainability Strategy (PDF 2MB)
Inclusion & Diversity Strategy
Divisional and Business Unit Strategies

Principles for Responsible Banking

Part of core group of 28 banks developing the Principles for Responsible Banking

UN Sustainable Development Goals

CEO Statement of Commitment (2015)

Paris Climate Agreement

Supporter (2015)

The Equator Principles

Founding Adopter, First Australian Bank (2003)

UN Environment Program Finance Initiative

Founding Member (1991)

Financial Stability Board’s Task Force on Climate-related Financial Disclosures

Align with and support

Commitment to United Nations Global Compact

Signatory (2002), Global Compact Network Australia Founding Member

Banking Environment Initiative

Founding signatory (2012)

Principles for Responsible Investment

Signatory (2007)

Global Investor Coalition Statement on Climate Change

Signatory (2014)

The Montreal Carbon Pledge

Signatory (2014)

Climate Bonds Initiative

Partner

Carbon Markets Institute

Corporate Member

We Mean Business Coalition

Signatory (2015)

Climate Action 100+

Signatory (2018)

Carbon Neutral Certification

Since 2012

Supply Nation

(for Indigenous owned businesses) Founding member (2016)

WeConnect International

(for women owned businesses) (2014)

Social Traders

(for social enterprises) Member of Connect (2016)

Our Industry awards, Sustainability indices, and Inclusion & diversity recognition can be found on our Ratings and Recognition page.

Westpac’s Environmental, Social and Governance dashboard

Helping people make better financial decisions

Helping people by being there when it matters most to them

Helping people create a prosperous nation

A culture of doing the right thing

Fundamentals