We consider social, environmental and ethical (SEE) risks no differently to the way we manage any other business risk. As a result, their evaluation and mitigation is incorporated into our general risk management framework.
Our operating companies are responsible for managing their own risks. As part of our risk reporting systems, they review and report on their business risks, including SEE risks, to our group control function on a semi-annual basis. The results of these reviews are reported via the audit committee to the board. This reporting is supplemented by risk review sessions - facilitated by group control - with the operating companies and the Pearson Executive Committee. In 2005, we carried out an independent review of the SEE risk processes in our UK businesses.
Our 2005 risk assessments did not identify any significant under-managed SEE risks, nor have any of our most important SEE risks, many concerned with reputational risk, changed year on year.
- Journalistic/author integrity: Fundamental to both our newspaper and publishing
operations. Our newspapers have clearly articulated journalistic policies and
procedures covering journalistic standards of conduct.
- Within the book publishing businesses, editorial and legal review processes are in place to ensure that our authors' independence and freedom of speech is respected and maintained, whilst protecting us legally and on copyright infringement.
- Ethical business behaviour: Our widely published Code of Business Conduct outlines
how we behave as a business. To ensure compliance, we ask employees on an annual basis to confirm that they understand the Code and to report any breaches. Our confidential whistle blowing help lines are another vehicle by which unacceptable behaviour can be reported.
- Compliance with UN Global Compact standards: As a signatory to the UN Global
Compact it is important that both we and our suppliers comply with these guidelines. Our greatest exposure is where we source printed material from developing countries, where less rigorous standards may apply. Both operating company and corporate employees regularly visit suppliers in these countries to ensure compliance.
- Environmental impact: Compared to many other businesses we do not believe that
our products have significant environmental impact. However, wherever possible
we strive to understand the effect of printed material on the environment. We work
with suppliers to use renewable sources of paper and recycled paper where available
and economically viable. In the UK, we are lead participants in an industry-wide
initiative involving both publishers and retailers, which looks at the process of book
returns - a feature of our industry.
- People: People are key to our business. Our human resource policies are designed
to attract and retain talented and motivated employees who enjoy and contribute
to the growth of Pearson.
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