Advisory Case Study: Strategy Development - Direct Line Group

BITC worked with Direct Line Group (DLG) to develop a distinctive and robust sustainability strategy following its separation from RBS Group. This included setting ambitious objectives for the four key impact areas of the company: Community, Environment, Sustainable Business Practice and Employee Experience.

Business benefits

  • Understanding of how sustainability can be defined at DLG and how responsible business fits with the company’s corporate culture.
  • Identification of what DLG’s material social and environmental issues are through a rigorous process.
  • Alignment between the new corporate brand, values and sustainability objectives.
  • Up to date information on how DLG’s sustainability performance compares with its peers and competitors.
  • Cross-functional and cross-regional knowledge of ongoing sustainability programmes and initiatives at DLG.
  • Improved internal stakeholder engagement at senior level and increased cooperation between departments and regions.
  • Established sustainability governance structure with senior management buy-in and support.
  • Detailed sustainability strategy with tangible initiatives that can form the basis for an implementation plan and budget setting.

Direct Line GroupThe Opportunity

The creation of Direct Line Group as a newly listed company, and our separation from RBS Group provided us with a unique opportunity to develop a CSR strategy that is aligned to our vision, beliefs and values. From the beginning we wanted to include CSR as a key strand of our new organisational culture and structure, with the focus on further engaging our colleagues in activities which would make them feel proud of being part of our new company and make an impact in our local communities. We have a strong track record in CSR and our people are already passionate about it, which is a strong foundation on which to build. Business in the Community was extremely supportive in helping us pull our programme together.

- Tom Woolgrove,
MD Personal Lines, Direct Line Group
Direct Line Insurance Group plc (DLG) is the leading UK personal lines insurer, operating across five segments – motor, home, rescue, commercial and international. It has a portfolio of own brands including Direct line, Churchill, Privilege and Green Flag. In 2009, RBS Group (RBSG) committed to the European Commission to sell its insurance business as a condition of its receipt of state aid. During 2012, DLG became essentially operationally separate from RBSG and more recently announced the intention to float and announced the price range for its planned initial public offering ('IPO').

Separation and divestment from the RBS Group required a strategic and coordinated approach to support the new corporate entity’s brand and values. It also prompted the organisation to define what corporate responsibility and sustainability means to DLG and its colleagues, and how it can support long term business success.

DLG engaged BITC at an early stage of the process with the aim of having an external organisation facilitate the project and provide regular constructive feedback and benchmarking. The collaboration was supported by a clear commitment from DLG to put sustainability and employee engagement at the heart of its business operations, making a wider contribution to society and the environment than just its financial results.

Our Methodology

BITC designed a participatory approach to developing a strategy with the aim of achieving senior manager buy-in. BITC’s work started with a discovery phase, carrying out a comprehensive research exercise to benchmark DLG’s sustainability performance with its peers and sector competitors. BITC also conducted one to one interviews with senior DLG staff to gauge their ambition and vision for the new sustainability strategy. Collating the findings from both the primary and secondary research, BITC presented the recommendations back to DLG’s Sustainability Advisory Group.

The second phase of the project established the foundations for the new strategy by putting in place a sustainability governance structure at DLG. This was complemented by a robust materiality assessment, which included a critical review of social and environmental issues of relevance to DLG’s business sector and operations.

The materiality workshop identified key issues across the four agreed impact areas: Community, Environment, Sustainable Business Practice and Employee Experience.

BITC supported the formulation of the four impact area specific working groups in the third and final phase of the project. These working groups were chaired by senior DLG employees and made up of members of the Sustainability Advisory Group and supported by BITC impact area experts. The working groups were then tasked with setting specific objectives and a timeline for their respective impact areas as well as identifying existing and new sustainability initiatives. These initial proposals and focus areas were presented to the new DLG Board, and the first phase of implementation was agreed.

Our Impact

Already, the project increased the internal awareness of Sustainability issues at DLG and built a shared understanding of material social and environmental issues. It also engaged key internal stakeholder groups across business functions and various regions.

In collaboration with DLG’s Sustainability Advisory Group, BITC developed a robust and actionable strategy for the newly forming company. This included a suite of opportunities and potential initiatives for the company to kick start its sustainability programme and realise tangible social and environmental benefits in the future.

Strategy development projects can only set the direction for change. BITC’s recommendations are due to be implemented over the medium to long term. BITC continues to advise and work with DLG to support the implementation of the new sustainability strategy.