Nationwide Building Society Performance

We also remain committed to demonstrating our mutual good in the communities we serve.

In 2024/25, we will launch our new social impact strategy, making a meaningful difference on the key societal issues that impact across a range of customer life stages, including young people, families and older people.

Last year, we committed £15.5 million8 to charitable activities.

We have a bold social ambition and strive to have a positive impact in communities.

The power of mutuality means we can do more together than we could each do alone.

In March 2024, we were first among our peer group when ranked by consumers as to which brands they had ‘heard good things about’22.

Nationwide is committed to a net-zero future and supporting the UK in achieving its ambition to be net zero by 2050.

Since 2018, we have continued to source 100% renewable electricity, and by the end of 2023, we had removed the use of gas from over 80% of our branch network, replacing it with electrical solutions.

We offer a range of green finance propositions and initiatives to support our customers in making energy efficient home improvements.

Therefore, we do not believe that our intermediate (by 2030) science-based target for mortgages will be achieved.

We aim to build a more sustainable world by supporting progress towards a greener society.

We aim to reduce our scope 1 emissions that we control across our own business operations, in line with our 2030 scope 1 science-based target.

Nationwide continues to be an inclusive organisation that values the diversity of the communities it serves.

The Board is also most effective when it reflects the diversity of its colleagues and members.

This year I am pleased that the Society’s diversity has been recognised in both the 2024 Financial Times’ Diversity Leaders list2, where we were ranked fourth out of 850 and, in the FTSE Women Leaders Report3, where we ranked sixth for female representation on our Board of Directors across 50 of the UK’s largest private businesses.

By 2028, our people will better reflect the wider society that we represent.

This includes seven measures that span across gender, ethnicity, disability and sexual orientation, as set out on the next page.

We achieved five of our seven measures to meet by 2024.

On 21 March 2024, following full consideration and the appropriate due diligence, the Society confirmed its intention to buy Virgin Money.

The Board’s assessment is that this binding offer is in the best interests of the Society and its present and future members.

This acquisition will strengthen the Society’s ongoing financial position, enabling it to continue to provide further value to customers and members through its products and services.

The Board expects that the acquisition will bring the benefit of mutual ownership to more people in the UK.

In March 2024, we confirmed our offer to buy Virgin Money.

We continue to make good progress on our plans and Virgin Money shareholders have now voted in favour of the acquisition, with completion expected in Q4 2024, subject to regulatory approval.

The Nationwide Fairer Share Payment of £344 million, distributed in June 2023, accounted for the majority of the difference between underlying and statutory profit.

We aim to return additional value to our members as owners, including through our Nationwide Fairer Share products and payments.

The Board also considered the needs of members who only held deposits with Nationwide and supported the launch of a Fairer Share Bond with a preferential savings rate that all members could access.

At its May 2023 meeting, the Board recommended that the Nationwide Fairer Share Payment be made to eligible members, following due and careful consideration of the full year financial results to ensure that the payment was affordable.

The Board intends to declare annual distributions going forward, provided they would not be detrimental to the financial strength of the Society.

The total Fairer Share Payment of £344 million was paid to 3.4 million eligible members who received a payment into their current account in June 2023 and over 116,000 Fairer Share Bonds were opened by members.

Our strategic drivers are supported by our Mutual Good Commitments, that seek to measure the positive impact we have on our customers, communities and wider society.

Separately, in 2024, we ran our third materiality survey, to understand from a range of our stakeholders the environmental, social and governance (ESG) topics that mattered most to them.

These responses will continue to help guide our ESG ambitions, as articulated through our Mutual Good Commitments (see pages 46 to 51).

Our ESG ambitions are embedded within our Society strategy, and are focused in areas where we believe we can make the most significant, positive impacts for our members and customers, our communities and society as a whole.

Our Mutual Good Commitments are overseen by the Executive Committee and the Board, and the measures that support them are set out over the following pages.

Our Mutual Good Commitments help us to hold true to our ethical principles and mutual purpose, and further reinforce the UN Sustainable Development Goals (SDGs).

This section describes how the directors considered matters set out in section 172(1) of the Companies Act 2006 (the ‘Companies Act’).

Listening to and engaging regularly with our stakeholders is fundamental to the way we do business, and it ensures we operate in a balanced and responsible way, both in the short and longer term.

Their views are important to us and help to guide our decision making.

The Board considers the outcome for all relevant stakeholders, as well as the need to maintain a reputation for high standards of business conduct, the need to act fairly, and the consequences of its decisions.

Our Board and Board committee papers must include a section for authors to outline how the matter directly or indirectly impacts our key stakeholder groups.

Among these values is the strong commitment from the Board to engage directly with our stakeholders, to listen to their views and to consider their interests during Board discussions and decision making.

We will offer customers a choice in how they bank with us, and support their financial resilience.

In March 2024, we extended our Branch Promise again, providing reassurance to our customers who rely on our branches, or prefer to speak to us face to face.

Since this time, we have further strengthened and extended our Branch Promise to at least the start of 2028, committing to no further closures.

By 2025, we will protect 750,000 customers with our Scam Checker Service7.

Since our target began in March 2022, we have protected 967,000 customers through this service, ahead of both our cumulative target for 2024 and our 2025 target.

As a result, we will uplift our cumulative March 2025 target to protect 1.4 million customers through our Scam Checker Service.

We will help more people into safe and secure homes, both our customers who have relationships with us and more broadly.

We are working to address the two main challenges that first time buyers face – raising a deposit and being able to borrow enough to afford a property.

Since setting our target in November 2020, we have helped 260,000 people into a home, ahead of both our cumulative target for 2024 and our 2025 target.

It also reflects the continued success of our Helping Hand mortgage, which launched in 2021 (see page 16).

As a result, we will uplift our cumulative March 2025 target to help 300,000 people to buy a home.

By 2025, we will have provided £1 billion of new lending to support the social housing sector5.

Environmental and climate consciousness are aligned to our mutual purpose of Banking – but fairer, more rewarding and for the good of society.

Climate change presents a risk to Nationwide and its customers, and so managing the risk from climate change, and aiming to build a more sustainable world by supporting progress towards a greener society, is core to Nationwide being a responsible business.

This compels us to take meaningful action by limiting the environmental impact of our business operations, helping customers to green their homes (so that they are warmer, healthier, more comfortable places to live, and more cost effective to heat in the long term), and better managing the impacts of a more unpredictable climate.

Ownership for responding to climate change sits with Nationwide’s Director of Strategy, Performance, and Sustainability, who reports to the Chief Financial Officer (CFO), whilst Senior Managers Regime accountabilities sit with the Chief Executive Officer (CEO).

The Responsible Business Committee is now an executive management-level committee.

It is the Society’s policy to provide equal access to training, career development and promotion opportunities (with appropriate adjustments made to processes if required) to all colleagues, regardless of their gender, race and ethnicity, gender reassignment, sexual orientation, age, religion or belief, disability, marriage or civil partnership, or socio-economic background.

We are a Disability Confident Leader, the highest level under the Disability Confident scheme introduced by the Government’s Department for Work and Pensions.

We support colleagues with disabilities and long-term health conditions with appropriate workplace adjustments and access to occupational health support if needed.

Should colleagues become disabled while employed, the Society will, wherever possible, make appropriate adjustments to support them in their existing role or re-deploy them to a more suitable alternative role.

We also have an active and supportive disability employee network group, which all colleagues are welcome to join.

In December 2022 we set and disclosed intermediate (by 2030) science-based emissions targets3, across scope 1, 2, and 3, and in December 2023, we published our inaugural Intermediate (by 2030) Net-Zero-aligned Transition Plan 20234, detailing the actions and potential actions needed for us to progress towards our targets.

Our scope 1 and 2 science-based targets are within our control due to our ability to manage our operational energy usage, actions underway to reduce or remove gas usage from our buildings, and the continued procurement of renewable electricity.

We remain confident in achieving our scope 1 and 2 intermediate (by 2030) science-based targets.

Therefore, we now do not believe that our intermediate (by 2030) science-based target for mortgages will be achieved.

The UK’s progress towards net-zero, particularly the greening of homes, has not been at the pace needed to deliver the emissions reductions required to support progress towards our intermediate (by 2030) science-based mortgages target.