BT 2009 Annual Report Download - page 73

ADDITIONAL INFORMATION FINANCIAL STATEMENTS REPORT OF THE DIRECTORS BUSINESS AND FINANCIAL REVIEWS OVERVIEW
REPORT OF THE DIRECTORS
71BT GROUP PLC ANNUAL REPORT & FORM 20-F
REPORT OF THE DIRECTORS
Responsible business
We have had in place for nearly ten years a written statement of
business practice (
The Way We Work ). This covers all our operations
and applies worldwide to all employees, and to all agents and
contractors when representing BT, and is available in nine
languages. During 2009, we have refreshed and reissued
The Way
We Work
and our policy on Anti-corruption and Bribery to all our
people worldwide.
We have also issued a new Gifts and Hospitality policy to our
employees. We are committed to high ethical standards and legal
compliance in all aspects of our business. We have measured our
employee awareness of
The Way We Work and the extent that our
employees have ethical behaviour; and we are reviewing our KPIs
on ethics to reflect our new policies.
Through our Sourcing with Human Dignity initiative, we seek to
ensure that working conditions throughout our supply chain meet
internationally recognised human rights standards. We investigate
potential social and environmental shortcomings and are
committed to achieving 100% follow-up within three months for
all suppliers identified as high- or medium-risk. During the 2009
financial year, we completed 27 on-site assessments (2008: 25).
The majority of assessments were conducted in China, although we
also conducted assessments in the Philippines, South Korea,
Thailand, France and the UK. We now employ our own assessor
based in Shanghai, which has enabled us to focus our efforts on
suppliers in China. We work with our suppliers to help them
improve their performance. In 2009, 83% of our suppliers agreed
that we work with them to ensure our purchases are made,
delivered, used and disposed of in a socially and environmentally
responsible manner.
The high-level principles in
The Way We Work are supported by a
continuing and comprehensive communications programme and
on-line training. A confidential helpline and dedicated e-mail
facility are also available to employees who have questions about
the application of these principles. The helpline number is also
published externally. BT’s Undertakings code of practice (
It matters )
forms part of our statement of business practice and is consistent
with it.
We are committed to managing our environmental performance
and have had an environmental management system in the UK
since 1992. We are certified to ISO 14001 in six countries including
the UK.
A Board committee – the
Committee for Responsible and
Sustainable Business
– chaired by Sir Michael Rake and comprising
representatives from BT businesses, three non-executive directors
and three independent members oversees our corporate
responsibility, environment and community activities, including
charitable expenditure and the strategy for maximising our
contribution to society. More information is available in Business
review – Corporate Responsibility on page 23. The Report of the
Committee for Responsible and Sustainable Business is on
page 56.
Political donations
Our continuing policy is that no company in the group will make
contributions in cash or kind to any political party, whether by gift
or loan. However, the definition of political donations used in the
Companies Act 2006 (the 2006 Act) is very much broader than the
sense in which these words are ordinarily used. It covers activities
such as making MPs and others in the political world aware of key
industry issues and matters affecting the company, which make an
important contribution to their understanding of BT. These
activities have been carried out on an even-handed basis over a
five-year period related broadly to the major UK political parties’
electoral strength. The authority we are requesting at the AGM is
not designed to change the above policy. It will, however, ensure
that BT acts within the provisions of the 2006 Act requiring
companies to obtain shareholder authority before they can make
donations to EU political parties and/or political organisations as
defined in the 2006 Act. During 2009, the company’s wholly-
owned subsidiary, British Telecommunications plc, made the
following payments totalling £17,658 (2008: £29,989) to cover
the cost of hosting briefing meetings with MPs and MEPs about the
company’s activities: Labour Party £5,933; Conservative Party
£5,380; Liberal Democrats £3,333; Scottish National Party £2,411;
Plaid Cymru £600. No loans were made to any political party by any
company in the BT group.
Pension funds
BT’s two main UK pension funds – the BT Pension Scheme and the
BT Retirement Plan (BTRP) – are not controlled by the Board but by
separate and independent corporate trustees. The trustees look
after the assets of the funds, which are held separately from those
of the company. The pension funds’ assets can be used only in
accordance with their respective rules and for no other purpose.
With effect from 1 April 2009, no further contributions are to be
paid into the BTRP as BT has made arrangements for all future
employee and employer pension contributions for BTRP members
and future new entrants to be paid into individual personal pension
plans arranged through Standard Life.
Payment of suppliers
In the UK, BT’s normal payment terms are 60 days from the date of
receipt of a due and valid invoice, although these terms may be
different in some of the local markets in which BT operates. BT will
make payment to the supplier on the agreed next payment run
following expiry of this term. BT also provides access in the UK to a
supplier financing scheme which offers suppliers the opportunity to
obtain payments in advance of the agreed terms. In 2009, the
average number of days between the invoice date and the date of
the payment run for the invoice was 49 (2008: 47).
Financial statements
So far as each of the directors is aware, there is no relevant
information that has not been disclosed to the auditors and each of
the directors believes that all steps have been taken that ought to
have been taken to make them aware of any relevant audit
information and to establish that the auditors have been made
aware of that information.
A statement by the directors of their responsibilities for preparing
the financial statements is included in the Statement of directors’
responsibility. The directors’ statement on going concern is
included in Financial review – Capital resources.
Takeover Directive disclosure
Following the implementation of the EU Takeover Directive by
certain provisions of the 2006 Act, we are required to make
additional disclosures. A number of these disclosures can be found
elsewhere in this Report as set out below:
structure of BT’s share capital (refer to page 115) including the
rights and obligations attaching to the shares (refer to pages 153
to 155);
restrictions on the transfer of BT shares and voting rights (refer to
pages 153 and 154);
BUSINESS POLICIES