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| Overview |
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Ian Butterworth Norwich Union Central Services Director
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| Norwich Union Central Services (NUCS) is the internal service
provider to the other UK Business Units. With 2,200 staff, NUCS
is responsible for managing many of the direct environmental
and health & safety issues of the company in the UK. |
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| The nominated management team for the environment is Jane
Willetts and Joe Coyne. |
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| Environmental Management |
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| Last year, in order to communicate, share best practice, discuss
issues and solutions and set objectives and targets more efficiently
an Environmental Action Group was set up. |
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| Representatives from Hill House Hammond, Morley Fund Management,
Norwich Union Insurance, Norwich Union Life, Your Move and NU
Central Services are involved in the forum (environmental action
group) which meets on a quarterly basis to progress the reduction
of direct environmental impacts of the UK businesses. Though
it is early days, there is a commitment to ensure that projects
are progressed, impact are managed and reduced. |
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| Within NUCS, there is a drive to integrate environmental issues
into all areas of the business. A project plan was created to
provide structure and responsibility to the programme within
the business. The living document maps the achievements and
targets for NUCS and has proved to be a useful communication
tool. Based on the document, the Senior Leadership Team discusses
the environment as a stand-alone issue once a quarter at their
Monthly Board Meetings and has included it in their business
plans for 2002. |
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| Progress during 2001 |
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| Property management |
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| The initial phase of a major property review for the UK operations
has commenced to identify the strategic accommodation requirements
going forward. Subsequent phases will focus on reducing the
property portfolio's impact on the environment. Industry standard
indices will be used to benchmark the portfolio's environmental
performance in terms of environmental impact. |
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| In both acquisition of new property or refurbishment of existing
buildings, full assessments will be carried out to ensure the
appropriate materials and technologies are utilised to meet
the stated objectives of the Group environmental policy. |
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| Where the use of an air conditioned environment or comfort
cooling is identified as necessary, the choice of system will
consider full 'life cycle' costs both in terms of limiting CO2
production and adoption of guidance given by the government's
Energy Efficiency Best Practice programme. |
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| A recent project to replace plant which is 'life expired'
has allowed the use of alternative technologies, eliminating
the need to use chemicals to control bacterial growth and precipitation
of scale. The project has also allowed replacement of specific
refrigerant gases (CFC's) which the UK has signed up to removing
under the Montreal Protocol. |
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| Chillers have been replaced in the Group head office in London
and in the Perth office for the following main reasons: |
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The existing units were at the end of their useful operating
life. Maintenance costs were increasing and reliability
was decreasing. The new chillers offer improved efficiency
compared to the old. |
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The implication of the EU regulations controlling the
use/manufacture of refrigerants meant that as of January
2001, the original R11 CFC was no longer available as
a replacement. This again imposed severe maintenance issues
on the installation. The new chillers use R134a gas, which
has zero ozone depletion potential. |
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The requirements of the chillers were significantly
altered by the improved lighting and cladding changes
during the post bomb damage refurbishment (1994). |
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| The system was also reconfigured so that they would be 'chillers
in parallel' rather than 'chillers in series'. This delivers
significant pumping running cost improvements. |
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| The new equipment and system reconfiguration delivers reduction
in energy use of 1,089 MWh saving £36,100 (as at time
of installation) and 459 tonnes of CO2
annually. |
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| Additional 2001 Progress |
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Reduction in energy consumption by 8.4 GWh annually
(5% of total 2000 electricity use) following the consolidation
of three data centres into one - at Bowthorpe, Norwich. |
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| Energy management |
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| Last year the new energy contracts, for both gas and electricity,
created a single supplier for each of these utilities. This
rationalisation aids the monitoring and managing of one of our
largest areas of spend and impacts on the environment. In addition
to this the electricity contract included an added environmental
benefit. |
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| The Group's and Norwich Union's key business divisions head
offices are now powered by 'green' electricity. Under a new
two-year contract negotiated with Scottish and Southern Energy
plc, approximately 19% of the annual electricity requirement
will come from renewable sources. |
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| This 'green' energy is generated by small-scale hydroelectric
plants, wind power and landfill gas. It is exempt from the government's
new climate change levy, which was introduced in April 2001. |
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| The deal also means that CGNU is one of the largest consumers
of renewable energy in the UK. |
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| Anthony Sampson, Director of Corporate Social Responsibility,
said: "This is excellent news, both for the environment
and our shareholders. It demonstrates that you can achieve environmental
and financial benefits at the same time. By using green energy,
we are contributing to national targets to reduce carbon dioxide
emissions (by 14,300 tonnes p.a.), and helping to lessen the
effects of global warming and climate change, with no increase
in our costs." |
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| Ian Butterworth, Director of Norwich Union Central Services
said, "At a time when environmental issues are becoming
increasingly important, through using our combined purchasing
power, we have been able both to support our Green agenda and
still deliver a cost savings to the Group." |
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| NUCS is also committed to a programme of energy management
across the occupied portfolio. At January 2002, this stood at
some 197 buildings of various types and sizes from large prestige
air-conditioned purpose built office blocks to small old leased
accommodations for relatively small numbers of staff. Clearly
some of these premises will be more appropriate for energy management
measures than others. |
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| The primary purpose of any energy management system must be
foremost to cut consumption of water, gas and electricity and
therefore reduce our impact on the environment. The added bonus
is a reduction in costs to the business units and increased
profits to the shareholders. |
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| In order to achieve a successful and sustainable long-term
approach to energy management NUCS identified (early) in the
initiation stage of the project that any initiatives must be
driven from the top down with commitment from the highest level.
This commitment should come in the form of an energy management
policy endorsed by the senior team. From the foundation policy
a strategy will be formulated and measures implemented to reduce
consumption in both the short, medium and long term. |
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| It is anticipated that some of these measures may require
little or no financial investment but produce immediate and
quite dramatic results, while others may need a significant
investment with pay back periods measured in years. Sustainable
energy saving measures will result in reduced consumption and,
by association, cost savings year on year and these will be
measured against the original base line. |
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| A vital component of any energy management system is a targeting
and monitoring system, which will give us the ability to measure
consumption accurately on a site-by-site basis. It is no good
knowing that we have consumed 118,149,228 kilowatt hours of
electricity nationally across the portfolio if we cannot identify
and target which sites are actually performing badly in terms
of consumption. While we may have big sites that consume a large
quantity of electricity it does not necessarily follow that
they are using it wastefully. |
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| Environmental conditions will also be considered - comparing
consumption at a site for a month in 2002 against the same month
for 2001 to check that external factors have not led to a rise
in energy consumption such as it being unseasonably cold for
that month. |
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| January of 2002 has seen NUCS complete its initial research
and the project could yield results from as early as Q3/4 this
year. |
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| Initially, it is envisaged that the project will be aimed
at electrical consumption as this forms the single largest proportion
of CGNU's energy consumption (and cost). Potential initial savings
are estimated to be in the region of 5-10% for the early stages
of the project with further savings to be made as the scope
is extended. |
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| Savings will be cumulative, ongoing and sustainable with commitment
to energy management. This represents an exciting opportunity
for NUCS Facilities to make a major contribution to CGNU's environmental
policy. |
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| Waste management |
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Rationalisation of waste contractors to ensure better
measuring and monitoring of waste volumes and segregation |
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| Paper use |
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Document Services are saving costs by reviewing the
Group's centrally produced laser print to identify material
like reports to the business units where the information
can be better communicated by other means. Document Services
produces 6.5 million pages a month for internal distribution.
A reduction of 20% drop would save £130,000 a year
- this would save 76.4 tonnes of paper per year. |
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Online catalogues and ordering facility for general
stationery items. |
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CGNU's 2001 Annual Report & Accounts was printed
on paper containing 50% post & pre-consumer waste
paper and 50% virgin fibre, which is totally chlorine-free. |
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A paper policy has been put together as a minimum requirement,
this has been agreed with the suppliers. |
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| Travel and transport |
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Two hybrid vehicles are being used as pool cars in York
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Video conferencing facilities were increased in Norwich
and main UK locations |
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| Training |
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| Sustainability Learning Networks programme |
| Neil Campbell represented NUCS Purchasing on the University
of Cambridge Programme for Industry's Sustainability Learning
Networks (SLN) programme in 2001. |
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| Neil said "I went on the SLN programme with an open mind
but also with a primary goal to understand how we could develop
sustainability into our supply chain. I knew we already had
sustainability initiatives underway with a number of our suppliers,
however, it was key that we learned to develop what we had begun.
Taking part in SLN allowed me to discuss our experiences with
like-minded people across various industries. It soon became
very clear that everyone was facing the same challenge with
their own suppliers. |
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| By attempting to develop a set of best practice guidelines,
our NUCS team was able to refine CGNU's current approach to
supplier management. We are currently finalising a strategy
for our suppliers that will see an increased focus on sustainability
issues for our current contract holders as well as at the pre-business
award stage. |
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| HRH Prince of Wales's Business & the
Environment programme |
| CGNU were represented in Cambridge at the 2001 Business and
the Environment Programme in April last year. This was the eighth
annual seminar held under the sponsorship of HRH The Prince
of Wales Trust and managed by a core faculty within the University
of Cambridge Programme for Industry. |
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| Joe Coyne was warmly welcomed by the management team as a
new member of their faculty, which offers the opportunity to
join a network comprising over 400 individuals across 250 companies
who now participate in this activity. |
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| The seminar was primarily aimed at individuals who operate
at a highly strategic level within their organisation and have
the potential to impact on long term and wider strategic planning.
Click
here to obtain further information about the seminar. |
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| Objectives for 2002 |
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| Objectives for 2002 have been identified as follows: (the
objectives set in respect of direct environmental impacts are
in respect of all UK operations). |
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| Property management |
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Property refurbishment tenders to be reviewed to include
environmental considerations and develop a process on
how to assess the responses by end Q2 2002. |
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Assess environmental impact of all CGNU properties and
develop and implement a strategy for improving the overall
profile of UK occupied properties over the next 5 years
by end Q2 2002 and ongoing. |
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Reduction in energy consumption due to the closure of
Basildon print facility. |
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Replacement programme of Halon Gas fire extinguishers
in computer suites by end 2003. |
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| Energy management |
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Energy management consultant appointed to develop an
energy management strategy and policy and implement a
reduction of 5% on electricity consumption by end Q4 2002. |
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Reduction in energy consumption through rationalisation
of printers, copiers and faxes by Q4 2002. |
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| Waste management |
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Increased volume of paper and cardboard recycling to
reduce landfill volumes by 10% by end Q4 2002. |
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Introduction of save-a-cup and can recycling in all
locations with more than 200 staff by end Q2 2002. |
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| Paper use |
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Buy-in from the businesses to the paper policy. Key
buyers from each business unit will be asked to sign-up
to the policy which promotes basic environment considerations
in the purchasing of paper supplies by end Q1 2002. |
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Supply of photocopier paper to be reviewed to identify
less expensive and more environmentally friendly supplies. |
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Warehousing review to centralise warehousing facilities
thus reducing the transportation of stock. |
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Reduction in paper volumes following a review of centrally
produced laser printing. |
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| Travel and transport |
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Two additional LPG minibuses supplied to York Office
by end Q1 2002. |
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Introduce dual fuel vehicles on the company car list
by end Q2 2002. |
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Reduction of fleet vehicles by removing car choice to
management level termed 'Heads of' and above following
the implementation of the policy in 2001. |
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Raise awareness of video conferencing facilities to
reduce the need for business travel. |
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| Training and communication |
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NUCS's approach to the environment is to be incorporated
into the NUCS induction booklet and induction presentations
and courses by end Q4 2002. |
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| Workforce |
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| The 'Change Champions' programme was set up to facilitate
the transformation process following merger of the legacy companies
to help understand behaviour. A spotlight staff survey was carried
out in September 2001 programme. In the first half of 2002,
290 staff will attend a Leadership Training Programme, which
will help to equip staff with leadership skills to enable NUCS
to provide greater levels of service. |
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| NUCS Unplugged is a communication initiative whereby the Senior
Leadership Team hold roadshows at the larger NUCS locations
and all NUCS staff are invited to attend. Presentations are
given by the Directors on their department's achievements, focuses
and plans going forward. These are followed by a question and
answer session. This supplements the other communications routes
of the Catalyst Magazine and information available on the Intranet
site. |
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| Health and Safety |
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| In February 2002 a series of initiatives were launched to
promote health and safety. As all staff have a responsibility
for maintaining a healthy and safe working environment, emphasis
will be on understanding the potential risks in the workplace
and how to deal with any concerns. |
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| A health and safety policy has been published in the UK and
during the course of the year, all CGNU staff in the UK will
receive individual copies of the new employees' health and safety
handbook. |
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| Suppliers |
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| Progress during 2002 |
| The Purchasing policy was signed of by the CGNU Board in September
2001. This extremely positive step in developing the purchasing
service within CGNU will enhance the service already provided
to internal customers and assist in improving governance and
best practice in the services offered by the purchasing function. |
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| The purpose of the policy is to set out the governance and
guidance role of purchasing within CGNU both in the UK and worldwide.
Focusing initially on the UK businesses and key global relationships,
the Group will progressively extend the reach of Purchasing
to encompass an increasing number of significant supplier relationships.
The policy also includes, for the first time, the mandatory
involvement of Norwich Union Central Services Purchasing for
spend above £50,000 with any suppliers in the UK and on
a worldwide basis where this involves any of nine of our key
supplier relationships. |
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| Improvements in payment practice |
| Great importance is given to ensuring our suppliers are paid
in a timely and efficient manner. CGNU UK operations adopted
the DTI's Better Payment Practice Code, which Norwich Union
originally signed up to in 1999. Through the merger we endeavoured
to comply with the code and will continue to seek improvements
in our adherence to the code. An example of good practice can
be seen in the decrease of creditor payment days, reducing from
39 days in 2000 to 19 days in 2001. |
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| The Norwich Union Insurance E-Payments project in the UK has
been designed to replace the current process of supplier payment,
consisting of manually matching invoices to estimates - an expensive
and time consuming process. The project is an integrated solution
whereby supplier payment is processed, authorised, and paid
electronically via BACS. This improves supplier payment performance,
reduces the need for cheque production and postage, and time
spent scanning manual invoices. |
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| Accreditation of purchasing system |
| A primary step in ensuring the purchasing service we provide
to our internal customers is of the highest standard and fair
and equitable to our suppliers was accomplished in 2001 by the
Norwich Union Central Services purchasing team in the UK. The
team worked towards, and achieved, accreditation from the Chartered
Institute of Purchasing and Supply (CIPS). The CIPS award was
presented following the purchasing team meeting the stringent
criteria demanded by the CIPS Corporate Partnership Programme
(CPP). The award demonstrates that the company is actively pursuing
best practice behaviour in this area. |
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| The award, presented in January 2002, was particularly well
timed as it coincided with the launch of CGNU's Group Purchasing
policy promoting the use of purchasing not only in the UK, but
also in certain areas on a global basis. |
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| Jane Willetts, Director of Purchasing said, "I believe
the recent release of the Group purchasing policy is a very
positive step in developing the purchasing service within CGNU.
It will allow my team to enhance the service we already provide
to the organisation and assist us in improving governance and
best practice in the services we offer." |
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| "CGNU has demonstrated a real commitment to change in
a very short timescale. By using the CIPS Certification standard
as a benchmark, the group has harmonised the purchasing processes
from three major organisations following recent mergers. In
addition, they have developed a purchasing Intranet to ensure
total visibility among all users," said Jeannie Bevan,
CIPS President. |
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| One of the priorities for the purchasing operation was to
develop a revised set of common processes and systems. |
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| The CIPS process review was used to ensure that purchasing
plans were focused on the correct areas and that the processes
we were implementing were based on industry best practice. |
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| Sections of the accreditation include provision of assurance
on purchasing issues such as environment, ethics, human rights,
standard of business conduct, health & safety etc. |
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| Having created a process manual for the initial certification
review, it was decided that from a cascade and maintenance point
of view, it would be better to have all process and procedures
activity on-line - in an intranet repository for all purchasing
related information. This is available to all CGNU employees
in the UK and further development of a purchasing site on the
global intranet, ARENA, is now underway to benefit international
internal customers. |
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| Introduction of CSR strands into purchasing |
| Potentially, it is easier to tackle the environmental impact
of a company at the purchasing stage rather than looking for
'end-of-pipe' solutions. As such, we are considering the following
approaches in the UK: |
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Firstly, by the rationalisation in the number of suppliers
for each of the commodities we purchase. This has two
benefits - we have the economies of scale to demand the
environmental criteria we feel necessary, and we are able
to obtain more accurate data, which in turn helps us to
measure and monitor our environmental impacts. |
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Secondly, last year we introduced some environmental
question sets in a number of the commodity areas, such
as office furniture. These were weighted along with other
considerations such as price, quality, service standard
etc. and where this was used there seemed to be a close
relationship between the environmental scores and the
'normal' purchasing criteria. We are building environmental
and ethical question sets relevant to each of the commodity
sets; the questions relate to environmental awareness,
commitment, supply chain issues, use of resources, and
product stewardship. These questions are weighted according
to where we feel the emphasis is needed. |
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| We will also be talking to and working with suppliers to improve
their environmental stance where appropriate. |
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| Over the past year NUCS Purchasing has started to increase
its scope and solutions are being sought on a wider European
and global basis. Environmental, social and ethical considerations
will be included in this expanding remit. |
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| Alignment with other business areas |
| We are concerned that a company of our size should have consistency
in the dealings of various business units and that 'values'
held in one area of the business should be the same as another.
To achieve this, NUCS are working with Morley Fund Management's
socially responsible investment (SRI) team to assess our top
100 suppliers to help align purchasing and investing criteria. |
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| Working in partnership with suppliers |
| CGNU chairs the interim Board of the ACORN Trust, an initiative
sponsored by the DTI to develop a stepped approach to environmental
accreditation for small and medium-sized enterprises. |
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| Increasingly, smaller companies in the supply chain of larger
businesses are required to demonstrate conformity with their
customer's environmental policies. This can be demanding for
a smaller business in the supply chain of several larger businesses
in different countries. |
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| The ACORN approach is in an advanced stage of development
in the UK and already has the support and interest of several
other countries in Europe and elsewhere. |
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| NUCS participated in a pilot scheme to act as mentors for
small to medium sized enterprises (<250 staff). |
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| Objectives for 2002 |
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Develop an environmental purchasing tool covering all
commodities within the sourcing process. This is incorporating
environmental considerations into the 'Request for Quotation'
and developing a process on how to assess the responses
by end Q1 2002. |
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Participation in the relaunch of the Acorn Trust supporting
small to medium sized enterprises in working towards environmental
accreditation. |
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Participation in the Chartered Institute of Purchasing
and Supply (CIPS) forum to promote best practice - ongoing. |
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We are planning to begin an environmental assessment
of our top 100 suppliers with Morley's SRI research team
by end Q2 2002. |
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| Community Investment |
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| With our largest concentration of staff (7,000) located in
Norwich, UK, we are eager to participate in schemes in the area.
With the University
of East Anglia, a world renowned University for its work
on climate change also being situated in Norwich it has made
sense to be partners in the University's Community Carbon Reduction
Project. It is believed that this project is the most ambitious
of its kind anywhere in the world as it involves not only the
new technologies etc. but also the social and cultural changes
necessary to bring about real climate change reduction. |
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| In April 2001 and throughout the summer NUCS helped fund a
Friends of the Earth Climate Change awareness programme in the
Norfolk area. The launch of the programme was a public exhibition
at the Norwich Assembly rooms depicting the effects of climate
change and how everyone can play their part in reducing the
impact. The week culminated in a public meeting where the understanding
of climate change and its impacts were voiced by a climatologist,
a local TV presenter and Zelda Bentham, CGNU's Environmental
Management Consultant. |
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| In August, UKCS Property & Facilities, supported by Purchasing
and Human Resources from Norwich, York, Perth and London, volunteered
to raise £5,600 in one month for CLIC. The fundraising,
with such a tight timescale, was a challenge, but they ended
up raising more than £8,000. |
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| Two teams were sponsored to take part in an Outward Bound
Challenge. The weekend in the Lake District included a five-
mile hike uphill, kayaking across Wast Water, raft building
and racing and other physical and mental challenges. The teams
said "We had a fabulous weekend, which was challenging,
very rewarding and for a worthwhile cause". |
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| In the UK, Norwich Union is a key supporter of the National
Neighbourhood Watch Association and besides our financial giving,
we also provide free accommodation to such charities in our
London and Bristol offices. |
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| Fundraising from Norwich Union carparks |
| Norwich Union has 7,000 staff working around Norwich. In view
of this number, they have several carparks. These are opened
at weekend to the public, as there is easy access to the shops.
The public pays for the carparking and the money collected is
then used to fund community initiatives. Last year approximately
£29,000 was raised this way. |
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