Customers

IAG customers include individuals, businesses, government and non-government organisations. The customer base is predominantly Australian, but our profile of international customers is growing rapidly as IAG continues to expand.

We provide insurance products to individual retail customers – individuals who are primarily home and car owners. We sell products directly to these customers through our network of branches, franchises, country service centres, call centres and the internet.

We also distribute products indirectly through intermediaries, such as insurance brokers and authorised representatives; and business partners, which include banks, credit unions and motor dealers.

Through our workers’ compensation businesses, we also build relationships with injured workers and their employers. We work closely with the WorkCover authorities in each State.

We work to provide consistent, reliable and excellent service beyond the claim to all our customers.

To assess how well we are meeting our customers’ needs, we conduct regular satisfaction surveys and focus groups across all our business lines. The results of these surveys can be found in the social performance section of the online report. We also seek our customers’ feedback on new products, such as the most recent Risk Radar for farms.

Through our workers’ compensation business, we receive ongoing formal feedback from regulators about our products and services. This feedback directly affects the profitability of these portfolios. We have also initiated a formal engagement process with employers, medical professionals and injured workers, which is described in this case study.

The wealth of data that IAG collects regarding weather patterns, claims and accidents is used to benefit our customers at every stage of customer contact. The Group’s online tools to assess the safety and environmental performance of cars and home products are just one way in which we help our customers reduce their own risk.

Shareholders

We have more than 950,000 shareholders.

We keep our shareholders informed through regular announcements to the Australian Stock Exchange, which are relayed through an email messaging service to shareholders who have registered to receive them. They are also posted on the IAG website.

Half-yearly results briefings and the Annual General Meeting (AGM) are webcast with archived copies available on our website.

We meet any obligations to communicate with our shareholders and, due to the size of our register and the cost involved in communicating directly to our shareholder base, we seek media coverage of important events if we need to deliver information. We encourage shareholders to use email to reduce paper usage and costs of postage.

We also communicate formally with shareholders through annual and half-year reports and at AGMs, where they are encouraged to ask questions of the Board.

Shareholders can also submit written questions to the company's auditor relating to the conduct of the audit and the content of the auditor's report to be considered at the AGM. The company's auditor attends the AGM to answer the qualifying questions. A list of questions is available at the AGM and the answers posted on our website after the meeting.

All our share registry functions are performed by Computershare Investor Services, which is a dedicated IAG shareholder information line. We also have a Shareholder Centre on our website.

Employees

We have about 12,000 employees across IAG.

Results from a recent diversity survey in Australia revealed that our employees are drawn from more than 10 ethnic backgrounds and speak more than 11 different languages. Women make up approximately 60% of our workforce, and our age profile in both New Zealand and Australia is strongest in the 25-34 age bracket.

We have a number of formal and informal channels available for employees to provide feedback and give input. These include Staff Consultative Committees, CEO email boxes and annual employee engagement surveys. Our employees also have the opportunity to talk about their experiences and the work they do through internal publications and videos. In addition to this, managers hold regular performance and career planning discussions with our employees.

Many employees also participate in our annual planning sessions, during which our strategy is communicated and team goals and plans are established.

Government bodies and regulators

In every country where we conduct business, we maintain honest, open and cooperative relationships with government and regulatory officials.

General insurers in Australia are subject to a significant amount of regulation. There is the corporate regulatory regime that applies to Australian incorporated businesses generally, as well as a range of industry-specific regulations at Federal, State and Territory levels. These regulations cover prudential supervision, market conduct and consumer protection requirements.

As such, in Australia we are in continual dialogue with both Federal and State governments; Federal regulators such as Australian Securities & Investment Commission (ASIC), Australian Prudential Regulatory Authority (APRA) and Australian Competition and Consumer Commission (ACCC); State regulators such as WorkCover and Compulsory Third Party authorities; and the Insurance Council of Australia (ICA).

In New Zealand, our contact is with national government, as well as the NZ Securities Commission and the Commerce Commission.

In Asia, IAG has built relationships with regulators in our areas of operation, these include the Department of Insurance ( Thailand), Bank Negara ( Malaysia), Monetary Authority of Singapore ( Singapore) and China Insurance Regulatory Commission ( China). As IAG continues to expand overseas, it will expand its interactions with governments and regulators internationally.

Through our Government and International Relations team, we are actively involved in the public policy process. We participate in parliamentary inquiries, make submissions and research policy issues to provide insurance protection and security to the community.

In 2005/06 we produced 24 public policy submissions in Australia, including the Parliamentary Joint Committee Inquiry into Corporate Responsibility. All public submissions to Government are available to view or download.

We adopt an evidence-based approach in public advocacy and aim to propose solutions that are in the best interests of our stakeholders. All political donations are disclosed through the Australian Electoral Commission website.

Suppliers

Insuring businesses and protecting people on the road, in the home, and workplace requires IAG to have a vast network of suppliers across all industry areas. These include smash repairers, builders, jewellers, office supplies providers, car manufacturers, medical and healthcare providers, lawyers and doctors.

At present we are working to expand our relationships with suppliers outside of Australia and New Zealand.

In 2006/07 we look forward to reporting on our supply chain relationships in our Asian operations.

Our customers often see IAG suppliers as key representatives of the Group’s operations. For that reason we seek out suppliers who share our values and philosophies. IAG’s Supplier Selection Guidelines in Australia aim to ensure that our suppliers share the Group’s commitment to sustainability. The guidelines are supported by supplier performance reporting for strategic suppliers. These reports detail supplier performance across broad criteria: quality, commitment, pricing, implementation, sustainability, and technology. In New Zealand we have similar requirements.

We are developing consultative mechanisms for our preferred supplier network and providing incentives for them to increase the sustainability of their operations.

Our preferred supplier code of practice in Australia also outlines our responsibility to our supply chain partners, including their rights to dispute resolution and our people’s responsibility to interact with our preferred suppliers fairly.

In Australia, we measure over 30 major suppliers on their contribution to our sustainability targets and their own sustainability initiatives. In addition, we make available a range of cost-competitive, environmentally-friendly products from our office supplies provider.

Unions

Just over 18% of IAG’s Australian employees are registered with unions (Finance Sector Union and Australian Metal Workers Union).

In New Zealand 1,052 (52%) employees are registered with unions (Public Service Association, IAG NZ Staff Association and Finsec).

Our consultation process with the Finance Sector Union (FSU) is detailed in the IAG Enterprise Agreement 2003 (Agreement). Under the Agreement, we consult with the FSU regarding workplace change programs impacting on employees, when positions are being made redundant and/or employees are being retrenched. FSU representatives are invited to address new recruits at our induction programs. In accordance with the Agreement’s grievance procedure, they are recognised as an employee representative.

This process is similar in New Zealand and detailed in the respective union collective employment agreements.

Community partners

Our community programs are focused on risk reduction, specifically targetting road and home safety, crime prevention, workplace safety, emergency services and climate change.

In Australia, our sponsorships operate at the national, state and local level, and include St John Ambulance Australia, Kidsafe, CareFlight, Salvation Army Emergency Services, Queensland Fire & Rescue Services, NSW Crimestoppers and our crime prevention initiatives/Social Capital Investment Programs (SCIPs).

In New Zealand they include Victim Support, The New Zealand Fire Service, Community Patrols New Zealand, Neighbourhood Support and WWF NZ.

In 2005/06, a selection of our Australian partners was invited to showcase their organisations at our CEO Forum, where our employees have the opportunity to interact with them as part of an expo-style event.

Representatives from partner organisations are also regularly invited to IAG functions.

A number of our community partners in Australia are also supported via IAG’s workplace giving program, through which employees can donate their pre-tax pay. IAG matches these donations. Community partners regularly update on how this support is being used.

IAG’s community partners can and do assist in product development where their expertise is relevant. For example, community partners provided input into the Climate Help product, as well as the most recent version of the Risk Radar.

IAG also engages with community organisations, government agencies and other businesses to deliver risk reduction research and advocacy programs.

In-house teams manage our day-to-day relationships with our partner organisations in Australia and New Zealand.

Business organisations and industry groups

A number of our employees are representatives in business organisations and industry groups.

For example, Mike Hawker, CEO of IAG, is currently the President of the Insurance Council of Australia (ICA), and we participate in many- and chair a number- of their committees. He also represents IAG on the World Business Council of Sustainable Development (WBCSD).

Nick Hawkins, CEO of IAG NZ, is the Vice-President of the Insurance Council of New Zealand.

We have representatives on committees for compulsory third party insurers, workers’ compensation insurers, and agents, actuaries and accountants. In NSW and Vic the committees include non-insurers that have a licence.

We also have representatives on the UNEPFI (United Nations Environment Program Finance Initiative) Climate Change Working Group, UNEPFI Insurance Working Group and we are a member of the Geneva Association.

Our Chief Risk Officer is the Australian representative on the International Accounting Standards Board (IASB) Insurance Working Group, which is advising the IASB on the development of an International Financial Reporting Standard for insurance.

We encourage our people to take part in public debate on areas of relevance to our core business. Our managers regularly speak at seminars, conferences and public hearings.

By taking an active role on specific issues relevant to our business, we believe we are demonstrating how seriously we take our role as Australasia’s leading general insurance group.