Slavery and Human Trafficking Statement 2021
This Statement is made pursuant to section 54 of the Modern Slavery Act 2015 (“the Act”) and sets out the steps that Arbuthnot Latham & Co., Limited (Arbuthnot Latham) has taken to ensure that slavery and human trafficking is not taking place in its supply chains or any part of its business or that of its subsidiaries (“AL Group”).
Arbuthnot Latham does not tolerate modern slavery or human trafficking within the AL Group’s business operations and is committed to ensuring that its supply chains are free from slavery and human trafficking. This Statement sets out the actions that Arbuthnot Latham has taken and will continue to take, to understand and combat slavery and human trafficking risks within the businesses of the AL Group.
Arbuthnot Latham is a private limited company registered in England and Wales and is a wholly owned subsidiary of Arbuthnot Banking Group PLC.
Arbuthnot Latham provides private banking and commercial banking services, with offices in London, Manchester, Exeter, Bristol and Dubai. Arbuthnot Latham’s subsidiaries include Renaissance Asset Finance, Arbuthnot Commercial Asset Backed Lending Limited and Arbuthnot Specialist Finance Limited. The Arbuthnot Latham Group prides itself on quality of service and reputation built on understanding client needs.
In support of our business operations, Arbuthnot Latham purchases goods and services from a number of suppliers, the majority of which are based in the UK.
Our policy on slavery and human trafficking
We have a Modern Slavery Act Policy, procedures and processes which reflect our commitment to acting ethically and with integrity in all business relationships, and additionally to ensure slavery and human trafficking is not taking place anywhere in our business or supply chains. We also operate a Whistleblowing Policy, which encourages our employees to report any concerns or wrongdoing.
Supply chain risk within Arbuthnot Latham
We operate within a professional and regulated environment and do not have complex supply chains or obtain material services from suppliers with a high risk of slavery or human trafficking. We have adopted a risk-based approach to review existing suppliers and will adopt this approach for any new supplier with which we contract. The Arbuthnot Latham Modern Slavery Act Policy is available to all existing and potential new suppliers to Arbuthnot Latham. Where applicable, contractual provisions will be included in agreements or terms of business with suppliers, which are reviewed at least on an annual basis.
Due diligence processes for slavery and human trafficking
As part of our initiative to identify and mitigate the risk of slavery and human trafficking, we carry out appropriate due diligence when engaging and working with suppliers, whilst also ensuring that the diligence undertaken is proportionate to the services provided.
Training is fundamental to raising awareness and educating all staff members on the issues highlighted in the Act. We therefore provide relevant training and development for all staff members in order to ensure a high level of understanding of the risks of modern slavery and human trafficking in our supply chains and business, and our obligations under the Act.
We will continue to review and report on the following indicators to assess the effectiveness of our actions:
- The number of employees trained in relation to slavery and human trafficking
- Any non-compliance with the Modern Slavery Act and its requirements
We reiterate our ongoing commitment to the Act and its underlying principles.
This Statement has been reviewed by key stakeholders and senior management and has been approved by the Arbuthnot Latham Board of Directors. It will be reviewed annually and updated as required.
This statement is made with respect to the financial year ended 31 December 2020 in accordance with section 54(1) of the Modern Slavery Act 2015. It has been approved by the Arbuthnot Latham Board of Directors and signed by a Director.
Chief Executive Officer
Arbuthnot Latham & Co., Limited
31 March 2021
Arbuthnot Latham & Co., Limited considers a dormant bank account to be one which has been inactive for the last two years and where it has not been possible to establish contact with the client. For security reasons we will not send statements to a client who has a dormant account where correspondence has been returned from their last known address. If you have money in a dormant account or lost account, it will always be your property (or if you die, it will become part of your estate). This is the case no matter how many years pass. To enquire about a dormant bank account, please contact our Private Banking Support team on +44 (0)20 7012 2600.
If you believe you have money or assets with Arbuthnot Latham & Co., Limited that are in a dormant or lost account, please call +44(0)20 7012 2500 and ask to speak to a member of the Investment Management team.
This section of the Strategic Report describes how the Directors have had regard to the matters set out in section 172 (1) (a) to (f) of the Companies Act 2006 when making decisions. It forms the Directors’ statement required by Arbuthnot Latham as a large-sized company under section 414CZA of the Act.
The Directors have acted in a way that they considered, in good faith, to be most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so had regard, amongst other matters, to:
- the likely consequences of any decision in the long term
- the interests of the Company's employees
- the need to foster the Company's business relationships with suppliers, customers and others
- the impact of the Company's operations on the community and the environment
- the desirability of the Company maintaining a reputation for high standards of business conduct and
- the need to act fairly as between members of the Company.
The stakeholders we consider in this regard are our shareholder, Arbuthnot Banking Group PLC (ABG), of which the Company is a wholly owned subsidiary, and its shareholders, our employees, customers, suppliers, regulators and the environment in which we operate.
The Arbuthnot Principles and Values set out on page 1 of the Annual Report of ABG, the Company’s holding company explain the Board’s approach to its stakeholders.
Likely consequences of any decision in the long term
The Directors make their decisions to ensure that long-term prospects are not sacrificed for short term gain, reflecting the values and support of Sir Henry Angest, Chairman of the Board and ABG’s majority shareholder, which have proved successful in creating and maintaining shareholder value over many years. This was demonstrated in the year by a number of Board decisions.
In November 2020, notwithstanding the uncertainties arising from the pandemic and Brexit, the Board approved the acquisition of Asset Alliance Group Holdings. It judged this to be complementary to the Group’s strategy to diversify its income stream with higher yielding assets, whilst not affecting its risk profile. It was also seen as a typical Arbuthnot opportunistic moment to buy a good business, constrained by external uncertainties and by funding which the Bank is able to supply.
Secondly the Board reaffirmed its decision, taken as part of the annual budget, to maintain significant investment in modern technology in order to grow the Group’s businesses, principally the new integrated Client Relationship Management (CRM) platform introduced in July. Investment in technology continued with the roll out ahead of the first national lockdown of Microsoft 365, including Teams for meetings, which enabled efficient remote working. Amortisation of this investment began at a time of pressure on the Group’s profitability due to the shortfall in income resulting from the impact on margins of the Bank of England base rate cuts in March 2020. Income was further reduced by the absence of growth in lending as a result of the decision to tighten credit appetites which was relaxed in September once the impact of the unprecedented extent of Government intervention in the economy became known. This typically cautious long-term approach led to a slower recovery from the damaging impact of the base rate cuts than would have otherwise occurred.
A further illustration of the balancing of the interests of our stakeholders in their long-term interest was the decision to withdraw the final dividend proposed in March 2020. This followed the decision of the board of ABG to withdraw its second interim dividend in response to the statement by the PRA on deposit takers’ approach to dividends since the Board had previously agreed that the Company would fund ABG’s dividends to its shareholders. Following the relaxation of the PRA’s position in December 2020, advising that it is for bank boards to determine the appropriate level of distributions, the Board decided in February 2021 to pay the withdrawn dividend which related to 2019 profits and also not to recommend a final dividend for 2020. The Board will continue to consider any future dividends to the Company’s shareholder in a prudent manner, ensuring they are properly planned in line with business growth and potential bad debt experience.
Interests of the Company's employees
The Board receives an update on human resource matters at each of its meetings. Early on in the pandemic, the decision was taken to prioritise job retention and not to furlough any staff, whilst awarding no bonuses for 2020, in order to protect the business. There were regular communications during the year including two Employee Surveys undertaken in order to support staff, reassure them over job security and to seek their views on the eventual return to office working. Each survey showed high engagement and positive responses, reflecting the efforts made to reassure employees by communicating the decisions made to look after them during the period of remote working. In the first survey in April, 94% of staff responded with 90% satisfied. 89% of employees agreed that they had been provided with the necessary IT support to work remotely, within a reasonable timeframe. From the comments received, there was a strong sense that communication had been clear, regular and consistent and had a strong focus on employee wellbeing. There were similarly good responses to the second survey in September which included questions on interest in remote working in future with 92% of employees proud to work for the Group, up from 83% in 2019.
Employees are able to raise concerns in confidence with the HR Team, with grievances followed up in line with a specified process which satisfies all legal requirements. Paul Marrow, a non-executive director and chairman of the Risk Committee, has been designated by the Board as the Director to engage with the workforce. He is also the Group’s Whistleblowing Champion and there is an anonymous whistleblowing service via an external provider. There is also protection for employees deriving from the Public Interest Disclosure Act 1998. Any whistleblowing events are reported annually to the Risk Committee and, where material, notified to the Board and to the applicable regulator.
Company's business relationships with suppliers, customers and others
The Directors attach great importance to good relations with customers and business partners. In particular, our clients are integral to our business and forging and maintaining client relationships are core to Arbuthnot Latham’s business and crucial for client retention. Regular contact was maintained with clients during the year providing support where possible, mainly by telephone following the closure of offices and some via Microsoft Teams. In the summer months, our bankers were able to meet some clients in their gardens. It was decided that the Bank should apply for approval into the Government Loan Schemes (BBLs and CBILs), administered by the British Business Bank, as this was important in being able to meet client expectations.
As their needs and expectations change, clients now demand access to their bank and relationship managers through a variety of channels and expect efficient and streamlined processes supported by state of the art technology. Hence the decision in 2019 to invest in the adoption of modern and integrated CRM technology with the potential to improve significantly front-office operations and help support existing and new clients better. This project was delivered during 2020 with all the training material both created and consumed remotely.
In July the Board approved a new relationship with a clearing bank as part of the move to an Extended Hours Service which was launched in December whereby customers are now able to send and receive faster payments 24 hours a day, seven days a week, with the Banking Support team on hand for longer, to assist with online banking-related queries.
The Company is committed to following agreed supplier payment terms. There is a Supplier Management Framework in place covering governance around the Company’s procurement and supplier management activities. For due diligence and compliance purposes, suppliers are assessed through an external registration system. The Modern Slavery Statement, approved by the Board each March as part of its annual review of the Company’s stance and approach to the Modern Slavery Act, explains the risk-based approach that the Company has taken to give assurance that slavery and human trafficking are not taking place in its supply chains or any part of its business.
Other stakeholders include the Company’s Regulators, the PRA and the FCA, with whom open and regular dialogue is maintained including regular fortnightly calls by the Finance Director and Chief Risk Officer with the PRA Supervisory team throughout the pandemic. The Board received and considered feedback, following the PRA’s Periodic Summary Meeting, reviewing the risk profile of the Bank, and agreed to address the composition of the Risk Committee by appointing an additional non-executive director, Angela Knight, to it.
Impact of the Company's operations on the community and the environment
As a financial services company our impact on the environment is limited. Nevertheless, there is growing consensus that an orderly transition to a low-carbon economy will bring structural adjustments to the global economy which will have financial implications, bringing both risks and opportunities. Accordingly, in September, the Board considered a report on the Strategic Review of Climate Change Opportunities Report, following consideration by the Executive Directors of the Group’s strategic response to climate change as part of the annual strategy and budget process.
Desirability of the Company maintaining a reputation for high standards of business conduct
The Directors believe that the Arbuthnot culture set out in the Arbuthnot Principles and Values on page 1 of ABG’s Annual report manifests itself at Board level and in the external view of the Group as a whole. The critical importance of the Company’s continuing good reputation is considered at each Board meeting. In February 2020 the Board approved the Group’s cultural values, encapsulating these Principles in five Group values, themselves embedded into day-to-day activities. These values are integrity, respect, empowerment, energy and drive, and collaboration.
24 March 2021