Encouraging growth.
Expanding opportunities.
Group Corporate Sustainability Report
31 December 2017

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Contents

Part 1: London Stock Exchange GroupCS Strategy

Part 2: 2017 Review
Our Markets

02 Welcome to our 2017 Corporate
Sustainability Report

05 Our corporate
sustainability strategy

03 Report at a glance

06 Materiality review
07 Progress on our commitments

Part 3: Our Overall CS Performance

Appendix

10 Our Markets

32 Data reporting overview

42 Appendix i

15 Our Services

33 Environment

45 Appendix ii

19 Our People

37 Social

47 Appendix iii

25 Our Communities

38 Governance

Our Services

Our People

Our Communities

30 Looking ahead

About London Stock
Exchange Group (LSEG)
London Stock Exchange Groupis a global markets infrastructurebusiness. We provide valuable
services for a wide range ofcustomers, focusing on Intellectual
Property, Risk and Balance SheetManagement and Capital Formation.
The Group plays a vital economic
and social role in enablingcompanies to access funds for
growth and development.

-42%

Overall carbon footprint per Full
Time Employee£1.4m

Donated to charity by LSEG Foundation

100%

Employees successfully completed
mandatory Anti-Bribery
and Corruption training in 2017
For further information, visit:www.lseg.com

Or contact:

Investor Relations
London Stock Exchange Group plc
10 Paternoster Square
London EC4M 7LS
Email: irinfo-r@lseg.com
For a glossary of terms, visit:www.lseg.com/investor-relations/group-glance/glossary

Our culture of sustainability
This report provides an annual updateof the Group’s approach, aims andachievements across all aspectsof Corporate Sustainability (CS).
Our sustainability performance for2017 is demonstrated through bothquantitative KPIs and descriptions ofvarious initiatives and programmesthat were put in place to implement
our strategy and reach our targets.
For further information, visit:www.lseg.com/about-london-stockexchange-group/corporate-responsibilty

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Welcome to our 2017 Corporate Sustainability ReportDavid Warren

Interim Chief Executive Officer andGroup Chief Financial Officer“We are committed tosupporting a financial
ecosystem that fosters
long-term investment
horizons, that helps businesses
across the world, especiallysmall and medium sizedcompanies, drive sustainableeconomic growth.”

Sustainable and green finance are becoming important
issues for our clients, both issuers and investors, and isrising up the agenda of governments and policy makers
around the world. In 2017, we have continued to review
both the impact of the Group in the way we operate our
expanding international operations and also the positive
contribution and benefits we can bring through ouractivities. We are committed to supporting a financial
ecosystem that fosters long-term investment horizons,that helps businesses across the world, especially small
and medium sized companies, drive sustainable economic
growth. The way in which we manage our business, and theservices we provide to financial markets, demonstrates ourcommitment to responsibly run our business for the benefitof all stakeholders: clients, colleagues and shareholders
amongst others. Our Group Corporate Responsibility policy
sets out the way we conduct our business to deliver
long-term value creation. We incorporate good practice
governance, and take into account our environmental andsocial impacts to ensure the long-term viability of our Groupand the fulfilment of our responsibility to stakeholders.
Our core role as a global markets infrastructure businessis to enable wealth and job creation, through the provisionof safe, transparent and trusted services. Our markets
facilitate equity and debt funding, providing small, medium
and larger businesses with access to capital, giving thema chance to grow, create jobs and contribute to the broader
economies in which they operate. We also help investors
make informed investment decisions through a range ofdata and analytics, including FTSE Russell’s benchmarking
services which provide a range of criteria, including
environmental, social and governance (ESG) factors,
and indexes such as the new FTSE Blossom Japan Index,
to facilitate the transition to a sustainable economy.

Our ESG Reporting Guidance, launched in 2017, isencouraging and assisting issuers in providing ESG
information that informs the engagement between
investors and companies. Furthermore, we signed theTask Force on Climate-related Financial Disclosures(TCFD) statement of support, affirming our commitment
to climate-related disclosures.
This report defines our updated Corporate Sustainability(CS) strategy, and highlights the developments andprogress that are material to our business and stakeholders
that we have made through the past year. We hope thereport gives you insight into the way we approach CS
throughout our Group. We welcome your feedback.

David Warren

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Report at a glance
Our 4 Strategic Pillars

Our Markets

Our Services

Our People

Our Communities

Funding sustainable growth andbuilding long-term economic
prosperity

Providing transparent market
operations and reliable andtransparent information to enable
informed investment decisions

Developing our diverseand global talent to fulfil
long-term ambitions

Empowering people,
enriching communities

Environment-42%

Overall carbon footprint per FTE
SocialHighlights:– ELITE has grown to include over 700
companies from 27 different countries,
with 7 companies joining public markets
in 2017– The inaugural Companies to Inspire
Africa report was launched– AIM reached £105 billion raisedsince launch– Borsa Italiana launched a Green &Social bonds segment– 2017 was a record year for green
bond listings– Borsa Italiana convened the inaugural
Italian Sustainability Day

Highlights:– FTSE Russell was selected by a number oflarge institutional investors for its new
sustainability indexes, including FTSE
Blossom Japan Index, FTSE4Good TIP
Taiwan ESG Index, FTSE Global Climate
Index Series and FTSE Divest-Invest China
A50 Index– FTSE Russell partnered with The
Transition Pathway Initiative, an asset
owner-led initiative that assesses
how companies are preparing for thetransition to a low carbon economy– Astana International Exchange selected
LSEG Academy as a partner for a 2 monthknowledge sharing programme

Highlights:– Developed the Group Career Framework
to enable internal talent mobility

Highlights:– LSEG Foundation donated over £1.4
million in 2017

– Launched unconscious bias training aspart of our Diversity and Inclusion strategy– School Home Support was chosen as
the new LSEG UK Partner Charity– Further developed Diversity and Inclusion
effort including development of global
WIN network and committing to the UK
Government Disability Confident Scheme– LSEG and UNICEF made progress in the
Zambian Girls 2030 project, aiming tohelp 11,000 girls access employment– Our Mentor Exchange was extended toFrance, Italy, Sri Lanka and the US withover 600 mentors and mentees connected– City Harvest was chosen as the new
US Partner Charity

40%

Stretch target of female
representation for senior
management and overall
population by 2020
Governance

100%

LSEG businesses self-certified ascompliant with our Anti-Bribery
and Corruption policies

Part 1:
London Stock Exchange Group
Corporate Sustainability Strategy

05
Overview

London Stock Exchange Group plc Group Corporate Sustainability Report 2017
Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

HeadingOur
corporate
TBC sustainability strategy
Our Corporate Sustainability (CS) strategy isdefined by 6 impact areas and is executed
through 4 pillars, as demonstrated in thegraphic to the right.
Our approach to CS– To play an essential role in enabling sustainableglobal economic growthGroup Strategy

Driving global growth

Developing our customer
partnership approach

Delivering best in classcapabilities

As a customer-focused organisation, we
benefit from deep and broad relationships
with market participants globally. Thisdrives product and service innovation and,combined with our ability to respondeffectively to secular trends, creates
growth opportunities across the financial
markets value chain.

LSEG is set apart in the Financial Markets
Infrastructure sector through our open
access philosophy and collaborative
approach. This gives us maximum
flexibility to develop commercial andcorporate opportunities amidst ongoing
industry and regulatory change.

We constantly seek to improve our
execution capabilities, customer servicing
and expertise in financial markets
infrastructure. We utilise technology, ourglobal scale and the skills of our people toinnovate, manage risks and operate in themost efficient and responsive way.

CS Strategy

ConveneGrow

Disclose

Transition

Develop

Sustain

Our CS strategy is definedby 6 impact areas

We leverage ourposition at the centreof capital markets
to facilitate dialogue
and catalyse action
towards thedevelopment ofsustainable finance

We will help SMEs
raise capital andfund investments tocreate employment
worldwide

We will provide
investors withinformation and tools
to assess the ESG
performance ofcompanies to enable
incorporation into
engagement andinvestment

We work with issuers
and investors toprovide solutions
that accelerate andmanage the transition
to a low carbon andsustainable economy

We will employ
and invest in thedevelopment of
a highly diverse
global workforce
to deliver on oursustainable vision

We will help theless advantaged
in communities
worldwide to develop
business skills andto support theenvironment

Our CS Approach

Our Markets

Our Services

Our People

Our Communities

Our CS strategy is thenexecuted through thefollowing 4 pillars

Funding sustainable growthand building long-term
economic prosperity

Providing transparent
market operations andreliable information
to enable informed
investment decisions

Embracing our diverseand global talent to fulfil
long-term ambitions

Empowering people,
enriching communities

Our strategy and ouractivities are aligned
to 3 strategic pillars– To ensure our CS behaviour and actions are
consistent with best practice while generating
long-term value creation
Corporate sustainability is core to our business growthstrategy. At LSEG, our business not only helps to strengthen
global economic growth, but it fulfils a social purpose, forexample, by supporting the funding and development ofsmall and medium sized enterprises (SMEs). We believe thatstrong corporate sustainability behaviour underpins
delivery of enhanced business performance, and we set our
CS objectives, above, accordingly. We collaborate to deliver,measure and promote sustainable business and investment
practices, for example through the Transition Pathway
Initiative, and work to sustain the environment, supportingand providing opportunities to the global community.
Our approach to CS is directed by Executive Committee
members that lead working groups comprised of crossGroup colleagues, focused on developing specific targets
in each of the 4 pillars. This framework, in combination
with a clear and comprehensive CS strategy, allows us
to have a voice in key debates that affect global capital
markets, creating a platform for interacting with influential
stakeholders. The successful execution of our CS strategy
is exhibited through the achievements made across 2017,
which are listed in this report.

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2017 Review
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Our Communities

Materiality review
Before reporting, all corporate sustainability
initiatives and activities from across the year
are assessed for their materiality.
The assessment falls within our CS strategic framework,where items are cross referenced against internal andexternal evaluators. Internally, activities are grouped intopillars and evaluated on their relevance to 6 impact areas.
Externally, the UN Sustainable Development Goals (SDGs)
and Global Reporting Initiative (GRI) materiality definition
are used to fine tune CS relevance. If all checks are passed,
the item is reported.
Together, this framework provides a tool to:

Impact Areas
The 6 impact areas and their materiality are:

CONVENEGROWDISCLOSE

TRANSITIONDEVELOPSUSTAIN

Collaboration with thefinancial industry,
charities, governments
and companies isimportant to progress
solutions for the moveto a sustainable andlow carbon economy

Supporting the growthof companies and theeconomy, and accessto funding, generates
jobs for a growing
population

The publication andreporting of ESG
activities in accordancewith rating agency
sustainability
recommendations
addresses the growing
investor base that
includes ESG factors
into their investment
process

To facilitate the smoothtransition to a low
carbon economy, we
work with our clients todevelop solutions forboth capital raising andallocation that embedsustainability into theinvestment process

Continued business
innovation, theincrease in employee
expertise and diversity
and setting ambitious
sustainability goals
strengthen our
industry position andincrease stability forstakeholders andthe economy

Maintaining support forunderprivileged
communities,
developing economies
and the environmentis important for the
future stability of all
stakeholders and thecommunities in theareas in which we
operate– set coherent and congruent objectives withcross-Group impact;– create aligned actions plans;– engage with employees to add value through innovative
CS strategies; and– engage effectively with external audiences andstakeholder groups.
Sustainable Development Goals
We assess CS initiatives and activities for their contribution
towards fulfilling 5 SDGs that are relevant to stock exchanges:
gender equality, decent work and economic growth,
responsible consumption and production, climate action andpartnerships for the goals. More information on the SDGs canbe found here: sustainabledevelopment.un.org/sdgs. Our
ESG Reporting Guidance also covers the SDGs and how they
can be used within corporate reporting.

Sustainable Development
Goals

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Key:
Exceeded target
Met target
Working towards target

Progress on our commitments
In the past year, we have continued to make progress towards the commitments made in our 2016 CS report.
Impact area

Commitment

Progress

CONVENE“Convene the investment industry to discussand progress solutions for the transition to asustainable and low carbon economy fromacross our business divisions”

LSEG hosted the ‘Water: Risk, Opportunity andSustainability’ Conference, organised by Environmental
Finance, which brought together 150 delegates frompension funds, governments and technology providers
among others. Borsa Italiana hosted the first Sustainability
Day to support dialogue between companies and investors
on ESG issues.

In 2017, FTSE Russell hosted Ownership Day, an event
organised by the UK Sustainable Investment and Finance
Association (UKSIF), which brought together asset owners
and many organisations such as The Pensions Regulator,
a representative of the Task Force on Climate-related
Financial Disclosures (TCFD) and the Environment Agency
Pension Fund, to explain the benefit of active engagementwith investee companies.

GROW“Scale up our offering for the promotionof SMEs’ access to funding and help thembridge the gap to long-term financing; buildon the ELITE initiative, our AIM market andthe ‘Companies to Inspire’ series; and address
the needs of developing markets including thedevelopment of vital market infrastructure”

In 2017, LSEG launched the inaugural Companies to Inspire
Africa report, identifying the fastest growing businesses
across Africa. 1000 Companies to Inspire Britain highlighted
companies under a new ‘Green’ section.

Arabia, with 7 ELITE companies joining LSEG publicmarkets in 2017. ELITE Club Deal launched the first
ELITE Basket Bond, a €122 million 10 year bondproviding debt financing to ELITE companies.

ELITE grew to over 700 companies from 27 countries, andlaunched in South America, West Africa, China and Saudi

AIM reached the milestone of £100 billion being
raised since launch, with £5 billion raised in 2017.

“Keep promoting our new ESG Reporting
Guidance for issuers through industry andeducation initiatives and integration within
our existing product portfolios”

We supported the implementation of our ESG Guidance
through a range of events, including ESG-focused ‘CapitalMarket Days’, the first of which was the Italian Sustainability
Day, which was attended by over 250 attendees.

ESG guidance was integrated into our Issuer Services
portal, accessible to all LSE issuers, found at www2.
londonstockexchangegroup.com/issuer-services/esg“Continue to take an active role withregulators and policy makers to advocate
global alignment of ESG reporting standards
and to address potential barriers tosustainable investment and finance”

LSEG, alongside industry participants, put forward
recommendations to the TCFD on its Phase I report thatwere successfully taken into account in the productionof the final report.

LSEG was a member of the High-Level Expert Group advising
the European Commission on how to integrate sustainability
considerations into its financial policy framework in order tomobilise finance for sustainable growth.

“Further develop the Global Sustainable
Investment Centre, adding new tools andproducts that support the transition to asustainable and low carbon economy andrelated capital flows”

Borsa Italiana launched a Green & Social bonds segment
to offer instruments whose proceeds finance projects that
benefit environmental and social projects.

LSEG saw the continued issuance of retail charity bonds
and record fund listings in 2017, with 13 renewable funds
now listed on our markets.

DISCLOSE

TRANSITION

SDGs Supported1

Progress

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2017 Review
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Our Services

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Appendix

Our Communities
Key:
Exceeded target
Met target
Working towards target

Progress on our commitments continued
Impact area

Commitment

Progress

DEVELOP“Work towards the achievement of theGroup-wide 2020 gender diversity targets andconsider extension of diversity programmes
beyond gender”

In 2017, we increased female representation in all areas:
Board, senior management and overall staff numbers. To
extend diversity programmes beyond gender we partneredwith agencies who specialise in attracting under-represented

SDGs Supported1

groups such as disabled, LGBTI (lesbian, gay, bi-sexual,
trans and inter-gender) and BAME (Black and Minority
Ethnic) groups.

“Set and achieve a target for staff
2020 volunteering targets were set: to involve 15% of
involvement in volunteering across the Group” the Group’s workforce in volunteering initiatives, either
individual or Group-led. Over 2017, we achieved 6%
involvement.

SUSTAIN“Set targets on charitable giving to deepen
focus on LSEG Foundation’s core mission”

We set the target of fully aligning our grant-making activity
to LSEG Foundation’s core mission. In 2017, 88% of grants,
up from 79% in 2016, were aligned with a small proportion“Upgrade our environmental management
system and consider revised environmental
targets”

In 2017, all UK electricity at controlled sites came from
100% natural renewable resources, rated at zero emissions.
64% of global electricity usage is from 100% renewablesources.

1. The Sustainable Development Goals (SDGs) identified here are those considered material for exchanges by the Sustainable Stock Exchanges initiativeof donations outside core focus, mainly in response
to humanitarian emergencies.

Progress

Part 2:2017 Review

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

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Appendix

Our Communities

Our Markets
Funding sustainablegrowth and building
long-term economic
prosperity

As a fundamental component of
the economy, our markets, built
on transparency and trust, help ourcustomers optimise their capital
resources and let businesses thrive.
HIGHLIGHTS– ELITE has grown to include over 700 companies from
27 different countries, with 7 companies joining publicmarkets in 2017
– The inaugural Companies to Inspire Africa report
was launched– AIM reached £105 billion raised since launch– Borsa Italiana launched a Green & Social bonds segment– 2017 was a record year for green bond listings– Borsa Italiana convened the inaugural Italian
Sustainability Day£105bnRaised on AIM since launch

28

Green bonds listed on LSE in 2017

“Our markets provide
opportunities forinternational anddomestic businessesof all sizes to raise capital,build sustainable growthand create long-term
economic prosperity.”
Raffaele JerusalmiGroup Director of Capital Markets

Impact Areas:
Convene | Grow | Disclose | Transition
Sustainable
Development Goals:

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

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Our Markets continued
Initiative

Companies
to Inspire
Grow

Companies
to Inspire Africa

LSEG launched the inaugural Companies to Inspire Africa report,
identifying the fastest growing and most dynamic private
businesses across Africa. 343 companies from 42 Africancountries, 22 of which in the renewable energy industry, wereselected. The report highlights the important role of female
entrepreneurship, with 12% of featured companies led by
women, more than 3 times the average for companies
across Africa.

343

Companies from 42 African countries

The inaugural Companies to Inspire Africa report was published in 2017

1000
Companies
to Inspire

The 1000 Companies to Inspire report is LSEG’s strategy for
identifying the fastest-growing and most dynamic SMEs.
This year we issued the fourth 1000 Companies to Inspire
Britain and second 1000 Companies to Inspire Europe reports.
In the 2017, 1000 Companies to Inspire Britain report, wehighlighted specific companies under a new ‘Green’ section,
as there is a growing number of British businesses that meetthe consumer demand for environmentally friendly businesspractices and products.

96,500Estimated number of low carbon andrenewable energy businesses in the UK

The fourth Companies to Inspire Britain report highlighted specific companies
under a new ‘Green’ section

AIM
Grow

The world’s
leading growthmarketIn January, AIM reached a major milestone for a growth market,
having raised over £100 billion since launch. Founded in 1995,
AIM has been a source of long-term growth capital for more than
3,500 companies from around the world. During 2017, a further£5 billion was raised, underlining AIM’s unparalleled capacity to
act as a vital source of permanent capital.

During the year, we published an AIM Discussion Paper toseek feedback from users of the market to inform our future
development of AIM. Overall, respondents recognised thebenefits of the AIM market model which provides SMEs withthe opportunity to join a public market that both supports theirdevelopment and provides investors with a comprehensive
standard of disclosure and a fair and orderly market.

£105bnRaised on AIM since launch12

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

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2017 Review
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Performance
Our Services

Our People

Appendix

Our Communities

Our Markets continued
Initiative

Bonds
Grow
Transition

Green bonds

Over 2017, 28 green bonds listed on LSE, solidifying LSEG’s
position as a leading international green and sustainablefinancing centre. Highlights include the largest green bond by a
UK company (SSE €600 million), the first UK bank to list a green
bond (Barclays €500 million) and the Indian Renewable Energy
Development Agency’s (IREDA) inaugural green Masala bond
(US$300 million), the first bond of its kind to list on our new
International Securities Market.

Rural Electrification Corporation of India (REC) also launched its
first green bond in London, securing US$450 million. In addition,
we welcomed the first green bond from the Gulf Region, issued
by First Abu Dhabi Bank.

LSEG was awarded a Certificate of Recognition at the Climate
Bonds Initiative Green Bond Awards on the 6 March 2017.
The award recognises issuers, regulators and service providers
that have played a pivotal role in growing the market.

These landmark transactions bring the total number of green
bonds listed on our markets to 65, which have raised around
US$21 billion.

28

Green bonds listed on LSE in 2017

€47bn

Borsa Italiana’s
Green & Social
bonds segment

Borsa Italiana launched a Green & Social bonds segment tooffer investors a list of defined instruments whose proceeds
finance projects which benefit environmental and social projects:
value of green and social bonds traded on Borsa Italiana in 2017
green and social bonds, respectively. In 2017, the value of green
and social bonds traded on Borsa Italiana was €47 billion.

Charity bonds

Retail Charity bonds is an issuing platform enabling UK charities
to raise medium-term debt finance through bonds issued toretail and wholesale investors. In 2017, we welcomed 4 newcharity bonds on our markets, raising a total of over £90 million
in aggregate terms.
Issuers include Greensleeves Care, a care home provider; Dolphin
Square Charitable Foundation, a charity providing affordable

Conferences
ConveneWater FinanceConference

In April 2017, LSE hosted the Environmental Finance ‘Water:
Risk, Opportunity and Sustainability 2017’ Conference,
which highlighted the importance of long-term businesssustainability and funding approaches, requirements and risks
to global investors in water utilities and infrastructure projects.

housing; Hightown Housing, a housing association; and Golden
Lane, a provider of supported housing for people with learning
disabilities.

Over £90m
Raised from charity bonds

150 delegates and 30 speakers from universities, pension funds,
governments and technology providers attended the event.

Greensleeves Care, a care home provider, launched the first retail bond for thecare sector

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

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Our Services

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Appendix

Our Communities

Our Markets continued
Initiative

Listings
Transition

ELITE
Grow

Green ETFs

23 green ETFs are listed on LSE, with value traded up 31% year
on year. Lyxor, Europe’s second largest ETF issuer, launched theworld’s first ETF to offer exposure to the investment grade green
bond market, the Lyxor Green Bond UCITS ETF, on LSE.

13LSEG saw record fund listings in 2017, with a total of 13 renewable
funds now listed on our markets. One notable listing is thatof Greencoat Renewables, an investor in Euro-denominatedRenewable funds listed on our markets
renewable energy infrastructure.

Continuing tosupport SMEs
achieve growth

ELITE is LSEG’s international business support and capital raisingprogramme designed for ambitious, high growth companies. In
2017, the ELITE global community grew to over 700 companies,
from 27 countries and 35 sectors, accounting for over 240,000
jobs. Demonstrating our commitment to supporting global SME
growth, ELITE launched in China, South America, West Africa andSaudi Arabia. In 2017, 7 ELITE companies joined LSEG’s publicmarkets across Italy and the UK.

Promoting good
ESG reporting
practice

31%

Year on year increase in green ETF value traded on LSE

Record fundlistings

ELITE Club Deal, the private placement platform that streamlines
the capital raising for ELITE companies, launched the first ELITELSEG ESG
Reporting
Guidance
Disclose

On our Italian ETFPlus market, 24 social ETFs and one social
fund are listed.

On 9 February 2017, LSEG issued guidance through the Global
Sustainable Investment Centre, setting out recommendations
for good practice in ESG reporting. The global guide responds todemand from investors for a more consistent approach to ESG
reporting, which is now a core part of the investment decision
process. The Guidance is available online to both issuers andinvestors globally, and was sent to more than 2,700 companies
that have securities listed on LSEG’s UK and Italian markets witha combined market capitalisation of more than US$7 trillion.

Basket Bond. The €122 million, 10 year bond is a unique wayof providing debt financing to ELITE companies, and is madeup of 10 well performing Italian ELITE companies.
ELITE Connect, a platform dedicated to listed companies,
investors and other intermediaries, co-hosted an ESG briefing
with the UK IR society. The event saw a panel, including expert
buy and sell side speakers, give a strategic overview on how the
ESG landscape is evolving. ELITE Connect is a tool that helps
companies improve visibility to the global financial community
using digital technology.

We have engaged companies of all sizes listed on London Stock
Exchange and Borsa Italiana, and FTSE Russell has consulted
asset owners and asset managers to understand key ESG
reporting challenges. The Guidance builds on market standards
such as the Financial Stability Board’s Task Force on Climaterelated Financial Disclosures report and the UN Sustainable
Development Goals. The launch of the Guidance leverages
the central role LSEG plays in capital markets and support
improvements in reporting, dialogue and data flows along theinvestment chain. The launch event was attended by over 800
market participants globally, both in presence and remotely.

ELITE’s global community grew to over 700 companies

Following the launch, the Guidance was integrated into
London Stock Exchange’s Issuer Services portal (www2.
londonstockexchangegroup.com/issuer-services) andpresented at the first Italian Sustainability Day organised
by Borsa Italiana (see p.14 for more detail). The full Guidance
can be viewed at: www.lseg.com/esg.

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

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Appendix

Our Communities

Our Markets continued
Initiative

Sustainability
ConveneTransition

Task Forceon Climaterelated
Financial
Disclosures
ConveneDisclose
Transition

First Italian
Sustainability
Day

Borsa Italiana hosted its first Sustainability Day to raiseawareness among all market participants and support thedirect dialogue between companies and investors on ESG
and sustainability topics.

Training was provided on ESG communication and discussions
on global sustainable investment trends were held for over 250
attendees, with over 80 investor meetings held across the day.
The event addressed the trend of investors incorporating ESG
factors into their investment strategies. The UK Sustainability
Day is expected to take place in 2018.

Environmental
and sustainableindexesOver 2017, FTSE’s climate themed indexes rose by more thantheir benchmark indexes, a trend also seen over a 5 year period.
These indexes include the FTSE All-World ex Climate Balanced
Factor Index, FTSE Environmental Opportunities Index series
and the FTSE ex Fossil Fuels Index Series.

Environmental index performance supports the growing
recognition by market participants globally that applying ESG
considerations to portfolios can align with investment objectives.

Influencing
policy toaddress climatechangeIn June 2017, the Financial Stability Board’s Task Force on
Climate-related Financial Disclosures (TCFD) released its
reporting recommendations. The Group signed the TCFD
statement of support, affirming its commitment to support
the recommendations and sees them as an important stepin driving improved global consistency in voluntary global
reporting standards. The TCFD is an industry-led task force
with the objective to develop voluntary, consistent climaterelated disclosures that would be useful to investors, lenders
and insurance underwriters in understanding material risks.

The TCFD took into account several recommendations put
forward by LSEG and industry participants in the responseto the Phase I report in the previous year, on topics such as
green revenues, sector approach and standardisation inframeworks. The TCFD recommendations strike a balance
between encouraging the supply of consistent, easily
comparable and reliable data and the need to avoid overly
prescriptive requirements, particularly where global consensus
has not yet been reached.

Borsa Italiana hosted its first Sustainability Day to raise awareness on ESG andsustainability topics

The final report provides context, background and the generalframework for climate-related financial disclosures and isintended for broad audiences. The Annex provides the next levelof detail to help companies implement the recommendations
and the Technical Supplement provides a further level of detailthat can be helpful for companies in considering scenario analysis.

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

2017 Review
Our Services

Performance
Our People

Appendix

Our Communities

Our Services
The Group provides systemically important
Providing“Delivering long-term
infrastructure services that support andsustainable growth, from market
business success ortransparent market enable
failure prevention mechanisms andresponsible investment to regulatory
investment returns requires
operations andreporting mechanisms, through an Opentaking a broader, longerapproach that underpins all ouroperations. We aim to help investors andreliable information Accessterm view. Sustainability
market participants make informed andsustainable
investment
decisionsandto enable informed execute them efficiently, safely anddata is central to this andcost-effectively.
our services enable market
investment decisions
HIGHLIGHTS– FTSE Russell was selected by a number of large
institutional investors for its new sustainability indexes,
including FTSE Blossom Japan Index, FTSE4Good TIP
Taiwan ESG Index, FTSE Global Climate Index Series
and FTSE Divest-Invest China A50 Index– FTSE Russell partnered with The Transition Pathway
Initiative, an asset owner-led initiative that assesses
how companies are preparing for the transition to a
low carbon economy– Astana International Exchange selected LSEG
Academy as a partner for a 2 month knowledge
sharing programme57%

Of large funds (over US$10bn AUM) want to incorporate
ESG into Smart Beta strategies

participants to incorporate
this information into
investment processes,
engagement and businessdecisions.”
Mark MakepeaceGroup Director of Information Services

Impact Areas:
Convene | Grow | Disclose | Transition | Develop
Sustainable
Development Goals:

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

2017 Review
Our Services

Performance
Our People

Appendix

Our Communities

Our Services continued
Initiative

AwardsTransition

Awards for
integrating
sustainability
into factor
index investing

FTSE Russell champions ESG integration into passive investing
through its ‘Smart Sustainability’ framework. This helps investors
integrate ESG into core passive portfolios and builds on the growthof ‘Smart Beta’ investing. The concept brings together ‘Smart Beta’
factors with sustainability parameters into a single index design.
FTSE Russell’s work in this area has won them and their clients
5 awards in 2017, particularly for work on the FTSE Climate
Balanced Factor Index. This index is used, by HSBC Bank UK
Pension Scheme, one of the largest corporate pension funds
in the UK, for its default passive equity allocations for its Direct
Contribution (DC) and Direct Benefit (DB) schemes. The total
allocation across the DC and DB schemes is over £4 billion. In
doing so, HSBC became the first scheme to adopt a multi-factor
investment strategy incorporating climate change protection aspart of its default fund.

Smart
Sustainability

FTSE Russell
Disclose
Transition

ESG Ratings
Model

Legal and General Investment Management (LGIM) use the index The index uses the risk premia factors and climate parameters
for its new high profile Future World Fund. LGIM has also invested to ‘tilt’ constituent weights either towards or away from specificits own capital in the fund and LSEG has included it as an option characteristics within individual companies.
for its DC pension members.
This award winning index is designed to target improved
long-term risk-adjusted returns through:– incorporating protection from climate change risks – throughreduced exposure to carbon emissions and fossil fuel reserves;– benefiting from the transition to a lower carbon economy – via
increased exposure to companies with ‘green revenues’; and– exposure to 4 alternative risk premia (value, size, momentum
and quality).
Mark Thompson, HSBC UK Pension Fund, and David Harris, LSEG, collect the IPE
award for Factor Investing

The fourth annual FTSE Russell global institutional Smart Beta
Survey, which comprised responses from approximately 200
asset owners from around the world, noted the significance ofSmart Sustainability for global asset owners.

The results demonstrate strong interest in applying ESG
considerations to Smart Beta, known as Smart Sustainability,with 57% of large asset owners (over US$10 billion assets undermanagement) anticipating applying ESG considerations totheir Smart Beta strategies. The main rationale provided for
ESG integration into smart beta was to avoid long-term risk.

FTSE Russell’s ESG Ratings Model is the backbone of ESG
integration by FTSE Russell and its clients. The model
assesses how companies manage their exposure to potential
ESG risks and scores companies accordingly. The overall scoreis used in the FTSE4Good Index family, which now includes
the FTSE4Good Taiwan TIP ESG Index, which was developed inpartnership with a wholly owned subsidiary of the Taiwan
Stock Exchange.
The Ratings and the underlying data across 14 ‘ESG themes’
help provide a common framework between companies
and investors on measuring and improving ESG practices,for example, shown through usage by the Transition Pathway

57%

Of large funds (over US$10bn AUM) want to incorporate ESG into
Smart Beta strategies

Initiative, an investor collaboration, and corporate consultants
such as KPMG. Investor engagement with companies has
become a key element of investment practices as covered in
Principle 2 of the UN-backed Principles for Responsible
Investment, and ESG Ratings can help support this.

17

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

2017 Review
Our Services

Performance
Our People

Appendix

Our Communities

Our Services continued
Initiative

FTSE Russell
continued
Disclose
Transition

Transition
Pathway
Initiative

The Transition Pathway Initiative (TPI) is an asset owner-led
initiative that assesses how companies are preparing for thetransition to a low carbon economy. It was launched by the
National Investing Bodies of the Church of England and theEnvironment Agency Pension Fund, with the London Schoolof Economics Grantham Institute and FTSE Russell as partners.
The TPI uses a subset of FTSE Russell’s ESG Ratings data from
There are over 25 asset owner and asset manager members
the Climate Change Theme to evaluate companies’ climateof the initiative who commit to incorporating climate change
strategies and low carbon transition plans.
considerations into their investment decision-making andengagement with companies, fund managers and policy makers.

Aligning FTSE
Russell’s
climate change
indicators with
the TCFD’s
recommendations

Following the release of the TCFD recommendations in June
2017, FTSE Russell conducted a full review of its climate-related
indicators and enhanced its climate change research. These
serve to ensure FTSE Russell’s methodologies and criteria, andthe TPI’s Management Quality indicators, are aligned with the
TCFD’s recommendations, respectively. The enhancements will
enable FTSE Russell to more accurately assess the quality ofcompanies’ climate change disclosures and scenario analysis,
and how climate change will impact companies’ strategy.
3 major changes were made to the indicators:

1. Inclusion of 7 new indicators

FTSE Blossom
Japan Index
and selection
by GPIFFTSE Russell developed and launched the FTSE Blossom Japan
Index in July 2017 to meet the need of long-term investors
looking to invest in Japanese companies. The new index isconstructed using FTSE Russell’s ESG Ratings data model, whichdraws on existing international ESG standards and aligns with
the UN Sustainable Development Goals. The inclusion thresholds
are aligned with the globally established FTSE4Good Index Series.

The index provides a powerful basis to increase corporate ESG
transparency and performance. The largest pension fund in
the world, the Government Pension Investment Fund (GPIF) of
Japan subsequently selected the index as a core ESG benchmark
through its flagship fund. The index was also selected for use
with 2 ETFs.

Othersustainability
indexes

FTSE Divest-Invest China A50 Index
In 2017, FTSE Russell launched the FTSE Divest-Invest China
A50 Index, an index designed to reduce exposure to Chinesecompanies with high carbon economy but increase exposure to
Chinese companies engaged in the transition to a green economy.

FTSE4Good TIP Taiwan ESG Index
FTSE Russell launched the FTSE4Good TIP Taiwan ESG Index,
developed in partnership with Taiwan Stock Exchange’s
subsidiary, Taiwan Index Plus Corp (TIP).

The index can be used by market participants to create index
tracking funds, ETFs, derivatives and as a performance benchmark.

2. New sector specific indicators
3. Updated sector categorisation model

4,000+

Companies covered by FTSE Russell ESG research

Indicators have started to be applied across the full universeof over 4,000 companies covered by FTSE Russell ESG research,with a full cycle of research expected to be completed by June
2018. Going forward, the Group will continue to review
the recommendations.

The index provides important new sustainability solutions forthe region and reinforces global investor demand to integratesustainability factors in investment portfolios.

Over 700
Companies covered by the
FTSE Blossom Japan Index

FTSE Global Climate Index Series
The new FTSE Global Climate Index Series and FTSE ESG IndexSeries were launched in 2017.
They are designed to help investors incorporate the transition
to a global green economy into core benchmarks and passive
investments, combining sustainable investing with an innovative
approach to factor index construction – Smart Sustainability.

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

2017 Review
Our Services

Performance
Our People

Appendix

Our Communities

Our Services continued
Initiative

MiFID II
Disclose

Ensuring
readiness for
MiFID IIMiFID II came into effect on 3 January 2018. The key objectivesof MiFID are to strengthen market regulation, increasetransparency and reinforce investor protection. LSEG has
completed an extensive programme of change in order to endure

its readiness for the implementation of MiFID II.

Ownership Day FTSE Russell
host Ownership
ConveneDay 2017

In April 2017, FTSE Russell hosted Ownership Day 2017, which is
linked to our efforts to convene key industry events around thetransition to a sustainable economy and improve dialogue on
this topic along the investment chain and with regulators. The
event was organised by the UK Sustainable Investment and
Finance association (UKSIF). It focused on asset

owners and the benefits of active ownership and engagementwith investee companies either directly or through asset managers.

LSEG
AcademyGrow

Accelerating
Growth in
an Exchange
Value Chain

As part of its mission in support of emerging markets, LSEG
Academy, training centre of the London Stock Exchange Group,developed and delivered 2 capacity building projects to thebenefit of executive teams from Tadawul, The Saudi Stock
Exchange and Astana International Exchange.

In August and September, a 5 day, bespoke training programme,‘Accelerating Growth in an Exchange Value Chain’, was held
twice to the benefit of 20 senior managers from Tadawul. The
programme was a benchmarking and learning opportunity for
the Tadawul team to be introduced to the core components anddynamics of a well-functioning financial market infrastructuresuch as LSEG.

AstanaFinancial
Centre Training

In November and December 2017, the nascent AstanaInternational Exchange chose LSEG Academy as a partner
in a 2 month knowledge sharing programme focused on
the development, monitoring and enforcement of listing
and capital market rules on AIX markets.

The programme was financed by TheCityUK and delivered, partly
online and in person, to 17 senior managers from AIX and AIFC.

For example, MTS upgraded its trading systems for Cash,
Repo and Bond Vision were updated, Millennium Exchange

Speakers included The Pensions Regulator, Institute and Facultyof Actuaries, Transition Pathways Initiative, ClientEarth, the Task
Force on Climate-related Financial Disclosures and the

For LSEG Academy, the project represented an opportunity toshare best practices and address the design of a solid regulatory
framework for privatised companies in Kazakhstan.

was upgraded to address equity and fixed income regulations,and an assortment of market infrastructure upgrades werecompleted on clock synchronisation, networks, cable lengthnormalisation and storage, amongst others.
Environment Agency Pension Fund. The event covered a rangeof governance topics, other ESG issues including climate change
and its potential implications for investors, and the importanceof dialogue and engagement between institutional asset owners
and their investments.

Astana International Exchange chose LSEG Academy for a 2 month knowledge
sharing programme

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services2017 Review
Our People

Performance

Appendix

Our Communities

Our People
Developing ourdiverse and global
talent to fulfil longterm ambitions

The engagement of our colleagues is central
to our organisation. We rely on the skills
and determination of our colleagues todeliver Group strategy, and to bring ourvalues of Integrity, Partnership, Innovationand Excellence to life.
HIGHLIGHTS– Developed the Group Career Framework to enable internaltalent mobility– Launched unconscious bias training as part of ourDiversity and Inclusion strategy– Further developed Diversity and Inclusion effort
including development of global WIN networkand committing to the UK Government Disability
Confident Scheme– Our Mentor Exchange was extended to France, Italy,
Sri Lanka and the US with over 600 mentors andmentees connected

700

Employees benefiting from Sharesave maturities“Our colleagues are thefoundation of LSEG,
embodying our motto‘My word is my bond’, anddriving the Group’s vision to
be the most trusted expert
in global financial markets.
We continually look to
improve their development
and engagement.”
Tim Jones
Group Director of Human Resources

Impact Areas:
Disclose | Develop | Sustain
Sustainable
Development Goals:

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services2017 Review
Our People

Performance

Appendix

Our Communities

Our People continued
Initiative

Diversity andInclusionDevelop

Summary
beliefs andStrategy

Unconscious
bias

Rededication of
LSE War
Memorial

LSEG values diversity and equality in the widest sense, andrecognises them as key drivers for development and innovation.
Diverse teams create opportunity, mitigate risk and are a catalyst
for new ideas. As such, we strive to be an employer of choice forthe diverse talent which we must attract, retain and engage in ahighly competitive market. To do this, we have implemented ourDiversity and Inclusion strategy.

making a difference and female representation across the Grouphas increased in line with our commitment to HM Treasury
Women in Finance Charter. Female representation has increased
to 33% in 2017 (July 2016: 30%). In March 2018, in line with new
UK requirements, we will publish our first Gender Pay Gap Reportacross our 3 UK legal entities and our plans to address any gaps.

Our work to improve diversity is guided by our Executive
Committee’s Diversity and Inclusion Committee, which ischaired by our Chief Risk Officer. Our strategy is alreadyWe currently brief all recruitment partners about our diversity
agenda. To reinforce the importance of committed action
on their part, we held a supplier event 1 November to givedetailed information on our gender targets, the challenges

In 2017, senior leaders and line managers undertook Open
Mind-set training, raising awareness of micro-inequities, theimpact of assumptions and how to change behaviour. To
reinforce the training, all colleagues completed unconscious bias
training. This was then applied to key management decisions

such as performance management and remuneration reviews,
to ensure outcomes are fair and consistent across the Group.
Similarly, when recruiting, we aim to include at least one female
in the hiring decision-making process to provide a more rounded
analysis and mitigate any unintentional bias.

On 14 November the Group rededicated and unveiled the London
Stock Exchange War Memorial. Employees wishing to attend
were warmly invited to do so.

On 20 September 2017, LSEG signed the UK’s Armed Forces
Covenant, an assurance that those who serve or served in thearmed forces, and their families, will be treated fairly andnot disadvantaged. Becoming a signatory reinforces LSEG’scommitment to supporting its surrounding communities
and encouraging inclusiveness in the workplace.

we face and engage their proactive support in increasing
gender representation.
In 2017, we provided diversity awareness workshops to line
managers, and we are currently working to increase diversity
and inclusion such as flexible working and the disability
confident employer scheme.
By 2020, we aim to achieve a stretch target of 40% female
representation for senior management and our overall
staff numbers.

100%

Staff completed unconscious bias training

Veteran colleagues attended the rededication of the LSE War Memorial

21

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services2017 Review
Our People

Performance

Appendix

Our Communities

Our People continued
Initiative

Employee
Development
and wellbeing
Develop

Colleague
Engagement &Wellbeing

Employee Engagement
An engaged workforce is critical for our success, and we remaincommitted to building a high performing culture where ourpeople can thrive. In our 2016 Have Your Say engagement
survey, which saw a response rate of 82% (2014: 76%), 3 areas
were highlighted where colleagues felt we could improve:
communication around change, cross-Group collaborationand career development.
Since then, we have implemented a number of practices to
respond to this feedback. To support the communication ofchange we have developed toolkits to help managers, and weinvested in a Group Change Framework to drive greater
consistency in how we manage change. In addition, the Mentor
Exchange programme is helping foster collaboration by uniting

Colleague
Forum

Providing colleagues with the opportunity to meet with theGroup’s leaders to raise questions and ultimately shape thefuture success of LSEG is important to us. To facilitate this,we have a variety of colleague forums, employee engagement
committees and representative bodies in place globally.
In the UK, the Colleague Forum supports all UK-based
employees, and is co-chaired by the CEOs of LSE plc and LCH Ltd.
The Forum meets bi-monthly to discuss and provide input to a

Reward andSharesave

The Group’s reward strategy focuses both on the short term,
through an annual bonus scheme linked to our global
performance management approach, and on the Group’s
medium-term performance through share schemes aimed
at senior management and all staff. The Long Term IncentivePlan, details of which can be found in the Group’s 2017 Annual
Report on p.78, aligns the performance and reward of our senior
management team with long-term performance and growthof the Group.

approximately 600 mentors and mentees across the Group,
and was extended to France, Italy, Sri Lanka and the US. We
also introduced On-boarding and Exit Surveys to understandthe experience we offer colleagues at these critical milestones,
and to help us understand how we can continue to improve as
an employer.
To provide more clarity around career opportunities, we havedeveloped a Group Career Framework which will launch in 2018.
This will provide a Group-wide view of roles, introduce consistentcorporate titles and behaviours aligned with our values. It will
enable colleagues to understand where their role sits in theorganisation, explore opportunities and plan their development.
We plan to host our next Group-wide Have Your Say survey inautumn 2018.

Wellbeing
A highlight of our engagement action planning has been the
launch of our wellbeing focus in the UK, which spans 5 pillars:
physical, mental, social purpose, financial and work-life balance.
In June 2017, we joined the City Mental Health Alliance, acoalition of organisations committed to improving support
around mental health. Internally, we have hosted a series ofexternal speakers, who have addressed our colleagues on topics
such as mental health, driving performance and building
resilience. We are now in the process of rolling out similar
practices across the Group.

number of key business initiatives and business change
programmes, as well as people-focused initiatives, such as
contributing to the launch of LSEG’s Wellbeing programme.

one place and creating communities of colleagues with similarinterests being able to connect with each other. There are now 10
clubs, ranging from Languages to Yoga to Running to Wine Tasting.

In 2016, the UK Colleague Forum launched ACTIVE, as a way forcolleagues to meet people from across the Group, both sociallyand in a work context, and to build connections and grownetworks. ACTIVE is a directory of clubs and groups available to
London-based employees, bringing together existing clubs into

Sri Lanka has an employee engagement forum that meetsregularly to discuss and progress their employee engagement
plan, whilst France- and Italy-based colleagues are represented
by the Works Councils and Trade Unions respectively, all of whichhold regular meetings on important business initiatives.

Our employee share ownership scheme, Sharesave, is available
to all permanent employees across France, Hong Kong, Italy,
Malaysia, Sri Lanka, the UK and the US. Colleagues can save up
to £500 or equivalent per month, with the option, after 3 years,of using their accumulated savings to buy LSEG shares.

plan. Participation was extended further, continued to exceed
50% in an organisation that grew one third year on year, andwas extended to colleagues joining the Group from Mergent
and The Yield Book.

During 2017, over 700 employees in 6 countries benefited from
Sharesave maturities including share price appreciation of c.
175%, further to the Group’s performance over the 3 years of the700

Employees benefiting from Sharesave maturities

22

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services2017 Review
Our People

Performance

Appendix

Our Communities

Our People continued
Initiative

Colleaguelearning
Develop

Learning andDevelopment

Throughout 2017, our Learning Management system, The
Learning Exchange, successfully delivered blended development
solutions across all LSEG locations, through visual and written
content, as well as events requiring attendance. The Learning
Exchange supports new business acquisitions and reaches
approximately 4,000 colleagues in the US, Asia-Pacific, Europe,
US and Rest of World.

Graduate,intern andapprenticeshipprogrammes

To support the growth and diversification of the Group, we
expanded our global Graduate and Early Career Programmein 2017. The programme now has over 250 colleagues globally,
and was extended to the US for the first time, strengthening ourtalent pool and leveraging significant growth opportunities as
we invest and acquire in the US. We also offer an apprenticeshipscheme and work experience for students interested in gaining
an insight into LSEG.
The programme provides graduates with rotations across theGroup, and will expand further in 2018 to support global growth.

ComplianceTraining

Considering LSEG’s role at the heart of capital markets, and theGroup’s reliance on the analytical skills and decision making
capabilities of its employees, adherence to the highest
behavioural standards is key to ensuring the quality of our
product and service offering. The principles of the Group’s
Code of Conduct are embedded into the Group’s operations
through a series of policies that are enforced through periodic
training and auditing.
This year, the Group’s compliance training programme
has covered the following policies with 100% completion.
We take completion of these modules seriously.

We tailored our current core offerings to meet businessand audience needs, focusing on supporting line mangers
throughout the colleague life cycle, managing change andraising awareness of unconscious bias. A practical and flexible
delivery approach was adopted throughout 2017, maximisingcolleague impact through providing real-time, in-house delivered
webinars and supporting resources encouraging colleagues totake ownership of their career. Managers were supported inholding performance and career conversations.

Our mandatory training modules were designed and delivered todrive an inclusive culture and behavioural impact. Line managers
received a dedicated module enabling them to proactively
manage the colleague experience from on-boarding to exit.
All line managers were invited to attend an interactive session
to raise awareness and mitigate the impact of potential
unconscious bias within their teams, with an online version
delivered to all global colleagues.

100+ graduates
On our graduate programme across Italy,
Sri Lanka, the UK and the US

170+ interns
Joined us globally

Training
Financial Crime
LCH Incident Management Procedure
Conflicts of Interest
Preventing Bribery and Corruption
Information Security
Unconscious Bias
Joiners, Movers and Leavers
1. Business Services Limited
2. Except Italy, who will complete in 2018

The 2017 graduate cohort

CoverageAll staff
LCH staff and part of BSL1
All staff2
All staff2
All staff2
All staff
All line managers

Completion Statistics
100%
100%
100%
100%
100%
100%
100%

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services2017 Review
Our People

Performance

Appendix

Our Communities

Our People continued
Initiative

Health and
SafetyDevelop

Updates topolicy andsystems

This year a new Health and Safety (H&S) Policy was approved
and published, with the major focus of this new policy recognising
the increased global presence of LSEG. Senior managers in each
LSEG entity have signed Statements of Intent to demonstrate
their commitment to safeguarding the H&S of their staff.
The development of a Group H&S Framework recognised thewidening scope of H&S risks for staff working for LSEG acrossthe globe. A high standard of safety and security is maintainedat all LSEG offices but increasingly, staff travel from and between
offices in the course of their duties and therefore many of theGroup’s H&S systems are targeted at this wider global risk.

Our People in
Numbers
Disclose

The changing
employeelandscapeOn 31 December 2017, the Group employed 4,908 employees,
an increase of 23% from the end of the previous reporting
period, mainly due to the acquisition of Mergent and The Yield
Book. On an organic basis, excluding the impact of acquisitions,
we can report on the following KPIs:

ShareAction
SustainPromoting
Living Wagestandards

LSEG hosted a ShareAction Market Open and Investor Briefing in2017. Attended by leading businesses and institutional investors,
the event celebrated the positive impacts of adopting the Living

A comprehensive Global Risk Register was developed to ensurethat all risks associated with working at LSEG are documented
and assessed to ensure that appropriate procedures and controls
are in place, and to enhance our systems where necessary. To
support the global H&S risk, access to a Legal Register was
procured. This enables the Group to measure complianceagainst H&S legislation in individual countries and will be
used to ensure compliance in all operating jurisdictions.

Employee-based indicators
New Hires (excl. Acquisitions)
Voluntary turnover
Permanent contracts
Fixed-term contracts

2017
1,228
9.5%
97%
3%

In 2017, a focus was placed on ensuring that all H&S procedures
and systems were appropriate to support the global risk. Eachsafety procedure and key systems were reviewed, including
water management, fire safety, electrical safety, permit to work
and workstation assessment. A new workstation assessment
system was launched to focus on mitigating against the risks
associated with using computers.

2016
1,055
5.6%
98%
2%

2015
1,010
9.9%
96%
4%

2014
(9 months to December)
346
8%
95%
5%

Wage standards, both on workers and on the business outlook
of FTSE 100 constituent companies. London Stock Exchange isa Living Wage accredited employer.

ShareAction opened the Main Market of London Stock Exchange, celebrating thepositive impacts of adopting the Living Wage standards

24

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services2017 Review
Our People

Performance

Appendix

Our Communities

Our People continued
Initiative

Women
Inspired
Network(WIN)
DevelopWIN

WIN Pillars

Now in its third year, the Group’s WIN continues to nurture
female talent at all levels across our offices in Fort Mill, London,
Milan, New York, Paris, Seattle, and Toronto. WIN is composedof 3 pillars: Winning Communities, Winning Networks andWinning People.

A recently launched sub-committee of active volunteers is
involved in various initiatives across the 3 pillars and connect the
network globally to ensure LSEG remains an employer of choice
for women and men.

Winning Communities aims to inspire female leaders of the
future. WIN works with schools, charities and other entities
to inspire young people to consider a career in finance andtechnology and to simplify what can often feel like anoverwhelming next step in their lives.

Winning Networks connects WIN members with otherdiversity networks and professional organisations to strengthen
the Group’s brand and broaden our network opportunities.

In 2017, WIN ran numerous initiatives across the 3 pillars in our
global locations to ensure LSEG remains an employer of choice
for all.

WIN networking event

Winning People aims to nurture talent within the businessand provide all employees with the best chance of succeedingin their career through relevant events, such as career insight
breakfasts and WIN Week Americas.

WIN UK
Supporting
Diversity

In 2017, WIN UK hosted numerous events including AllBright’sFoundHer initiative, Women in ETF’s, and Veuve Clicquot’s
Business Woman Award. In May, LSEG welcomed HRH TheCountess of Wessex to open the market in celebration of the

Women’s Network Forum. We welcomed the Power Women
Network to our office in London, hosting a high-level panelsession on the theme of ‘Diversity: driving innovation’.
The event emphasised the Group’s commitment to all forms

WIN Italy
Young WINners
Programme

The Young WINners Programme reaches out to academically
gifted female students aged 16–18 who come fromdisadvantaged backgrounds. A total of 60 academically gifted
female high school students took part in a series of lectures at

Borsa Italiana’s Milan and CC&G’s Rome offices, covering topics
such as work-life balance, managing change as well as CV writing
and interview skills. 2 participants won a scholarship to attend
4 weeks of summer school in Ireland.

WIN USWIN Fort Mill
Following the completed acquisition of Mergent, a networking
event at the new Fort Mill office was sponsored by LSEG’s WIN
culture and diversity network, alongside the newly established
WIN Fort Mill group. The session allowed new and existing
employees to mix and learn about the professional development
opportunities available as we integrate this importantacquisition.

WIN Week Americas
WIN North America was relaunched in 2017. The main LSEG
offices in North America – New York City, Fort Mill, Seattle andToronto – organised a week-long series of events aligned to theinitiative’s pillars. The activities and presentations provided aplatform for career development and networking with colleagues
and leadership, and also included training and wellness activities.

WIN Sri
Lanka

Building up to a formal launch in early 2018, the WIN Sri Lanka
community has been actively engaged with the tech industry’s
women empowerment initiative Diversity Collective Lanka.

In November, Sri Lanka’s inaugural Women in IT Awards
recognised the outstanding contribution of one of MillenniumIT’s
female business leaders.

of inclusiveness, including gender diversity. In addition, WIN UK
also successfully nominated one of LSEG’s rising stars who won
the Asian Women of Achievement Young Achiever award.

60

Academically gifted girls took part in a lecture series on life skills

WIN Week – Team and panellists

25
Overview

London Stock Exchange Group plc Group Corporate Sustainability Report 2017
Corporate Sustainability Strategy
Our Markets

Our Services

Our People

2017 Review
Our Communities

Performance

Appendix

Our Communities
Empowering
people, enrichingcommunities

As our global presence grows, we monitor
our impact on the communities aroundus and how it aligns with our strategy andvalues. We aim to promote sustainable
practices, support local communities
and the environment where we have asignificant business presence.

“Using our global footprint tomake a positive social andenvironmental impact andsupport local communities.”

HIGHLIGHTS– LSEG Foundation donated over £1.4 million in 2017

Diane Côté
Chief Risk Officer and Chair of LSEG Foundation– School Home Support was chosen as the new LSEG UK
Partner Charity– LSEG and UNICEF made progress in the Zambian
Girls 2030 project, aiming to help 11,000 girls accessemployment– City Harvest was chosen as the new US Partner Charity£1.4m

Donated to charity from LSEG Foundation

School Home
SupportWas chosen as the new UK Partner Charity

City Harvest
Was chosen as the new US Partner Charity

Impact Areas:
SustainSustainable
Development Goals:

26

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services

Our People

2017 Review
Our Communities

Performance

Appendix

Our Communities continued
Initiative

Partner
Charities
Sustain

Global Partner –UNICEF

UNICEF has been LSEG’s global partner charity for 19 years. A
key project between LSEG and UNICEF is Zambian Girls 2030,
which aims to equip more than 11,000 Zambian girls with
employability skills and help them access formal employment

in Zambia. To date, the project has helped nearly 8,000 girls enrolin school-level careers and skills clubs.

Current UK
Partner Charity- Ellen
MacArthur
Cancer Trust

The Ellen MacArthur Cancer Trust (EMCT) rebuilds confidence
in young people recovering from cancer by providing theopportunity to sail. In 2017, in addition to corporate donations,
we raised over £6,000 for EMCT through a pub quiz, bake sale,raffle and foreign exchange collection boxes. With the cost of
supporting one young person on a first time, 4 day sailing trip at

approximately £575, our donation equates to supporting 11
young people on their road to recovery from cancer.

Future UK
Partner
Charity –School Home
SupportSchool Home Support, which provides access to the educationand life skills young people need so that they can go on to leadsecure adult lives, was announced as LSEG’s new UK Charity

Partner in October 2017. The 3 year partnership with LSEG
Foundation will provide a substantial boost to a charity
previously operating on a limited budget.

France Partner –Unis-Cité

Unis-Cité’s purpose is to bring young people who have dropped
out of school back to education or to employment, in order toincrease their chance of acquiring autonomy, stability andwellbeing in the future. The Booster programme is steered by
the French Ministry for Education and the Civic Service Agency.

The programme involves:and mathematics.

– 3 days a week with Unis-Cité involving solidarity actions andcreative projects, andOver 2017, LCH SA and LSEG have increased their participationin Unis-Cité by financing an additional class for 2017–2018. This
raised the number of participants helped by LSEG Foundation to31, helping them regain self-confidence and put them back on
track for their future.

LSEG also contributes to the UNICEF UK Children’s
Emergency Fund.

In January 2017, EMCT announced their Round Britain Tour,
uniting 100 young people. In July 2017, the EMCT crew wereinvited to open the market at our headquarters in London– 2 days a week in school for individualised teaching sessions.
The aim is to develop competencies, such as self-confidence andinterpersonal skills, respectively, and computer skills, team work

Italy Partner –COMETACOMETA’s mission is to help at-risk students develop thetechnical and soft skills required to enter the job market or
higher education, after achieving a professional qualification.
On an annual basis, 24 LSEG volunteers support 50 students

US Partner –City Harvest

City Harvest was chosen by LSEG Foundation as partner charity.
Working with schools, the programme will help disadvantaged
young people learn about nutrition and to help them understandthe importance of healthy nutrition in leading a healthy andsuccessful life.

The 2017 LSEG Foundation Day brought together charities to which theFoundation donates, including UNICEF

to complete education, acting as mentors on skills such ascommunication, finance, mathematics and English. In addition,
through face-to-face meetings and video calls, the mentors
provide interview practice, case studies and work on businessplans with the students.

LSEG colleagues packed 200 bags of food to serve around 200 families forseveral days

27

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services

Our People

2017 Review
Our Communities

Performance

Appendix

Our Communities continued
Initiative

Regional
Charitable
Giving andVolunteering
Sustain

Global

LSEG Foundation
LSEG Foundation is the single channel for the Group’s charitablegiving and focal point for staff engagement with charities.
Its core mission is to empower people and enrich communities.
Recognising the global reach of LSEG’s business model, theFoundation’s approach and positioning are aligned with theoverall Group CS strategy (see p.5).

The Foundation is a grant-making charitable body, focusing
on projects that help young and disadvantaged people reach
their full potential by developing life skills and business acumen.
It places particular attention on entrepreneurship, encompassing
the communities in which the Group has a significant numberof employees.

UK

Opening the Market in support of Prior’s Court
Prior’s Court was founded 1999 and welcomes approximately 60
pupils from 5–23 years that suffer from severe autism.
Unfortunately, only 16% young people with autism will ever holddown a job. Prior’s Court wants to change this by offering them realskills that will enable them to stay in employment, which is the aimof the Prior’s Court Bakery Project. LSEG proudly opened the market
in support of this project and its launch.

Tour of Cambridgeshire Cycle Ride
LSEG employees rode in the Tour of Cambridge Gran Fondo cycling
event to raise money for the Atlas Foundation, which uses a
global network of Rugby Champions to support projects that use
rugby to improve lives of the poorest people. 9 LSEG employees
joined a peloton of 60 riders in the event, raising £16,000.

Charity Touch Rugby Tournament
In partnership with the Harlequins Foundation, a charity thataims to combine the sport of rugby to create opportunities foryoung people in local communities, LSEG organised a third
annual touch rugby tournament. Over £34,500 was raised in2017 and involved 28 companies from across the City of London.

US

Treehouse
FTSE Russell Seattle volunteered and held donation drives for
Treehouse, a non-profit serving young people in foster care.
24 hours was volunteered and a US$5,000 grant provided
to Treehouse.
American Heart Association Run & Walk
For the fourth consecutive year, LSEG employees from FTSE
Russell, LCH, MTS, UnaVista and Corporate Functions took partin the annual Wall Street Run & Walk, which benefits theAmerican Heart Association. The event raised US$2 million
overall, with LSEG employee donations of over US$1,000
doubled by matching from LSEG Foundation.

Meridian Pull Challenge
5 LSEG teams took part in the Meridian Pull Challenge inJune, raising over £10,000 for the AHOY Centre (Adventure,
Help and Opportunities for Youth). The AHOY is a water
sport-based charity in London that aims to change lives bybuilding key life skills through sailing and rowing. The charity
works with disadvantaged, at-risk young people, those excluded
from mainstream education and disabled individuals.

The Group is in the third year of a global partnership with
UNICEF, having focused its community work on a project thatstrongly supports LSEG Foundation’s core mission: helping
11,000 Zambian girls obtain formal employment.

LSEG opened the Market to support Prior’s Court Bakery Project, which aims tooffer young autistic people the skills required for permanent employment

City Harvest
New York City colleagues gathered to support City Harvest,
a programme that rescues excess food and delivers it to thehungry. Employees packed 200 bags, estimated to serve 200
families for 2–3 days, and 56 boxes of food for families impacted
by hurricanes in Puerto Rico. The event also served as anintegration mechanism for our employees who are spread
across 5 offices, including those newly acquired.
Staff also joined the City Harvest Skip Lunch event, where
employees donated the money they would usually spend onlunch to help feed hungry children. The funds raised by LSEG
employees provided sufficient food for approximately 1,000
children over summer 2017.

6 colleagues spent 24 hours organising a free store where young people in foster
care and their caregivers can shop for essentials

28

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services

Our People

2017 Review
Our Communities

Performance

Appendix

Our Communities continued
Initiative

Regional
Charitable
Giving andVolunteeringcontinued
SustainEnvironmental
achievements
Sustain

Italy

Intercultura
Many donations have been made to Italian charities, such as€15,000 to Intercultura, a non-profit volunteer-based, educationalorganisation that promotes intercultural learning through student
exchanges, and, €20,000 to Mondo Bambino Onlus, a charity
supporting children’s growth in discriminative social situations.

Sri Lanka

Micro-volunteering
In 2017, a number of small micro-volunteering events wereorganised that benefited local communities. Examples of suchinitiatives include fundraisers to purchase monitors used to fightthe dengue epidemic in Sri Lanka, which were donated to a local

hospital; providing dry rations and cash donations to thoseaffected by floods and landslides; organising a book donation
drive to assist a local library and school; and, organising a beachclean up.

Australia

The Smith Family Foundation
The LSEG Sydney office donated AUD$15,000 to The Smith
Family Foundation, which supports disadvantaged young

students and families through education. The donation helped
support approximately 26 young people.

Performanceandmanagement

Move to 100% natural renewable energy
From 1 May 2017, all UK electricity at controlled sites came from
100% natural renewable sources (hydro, wind and solar power)
and is rated at zero carbon emissions. The switch accounts formore than 50% of electricity purchased globally, and the UK
switch builds on 100% hydro-generated electricity that was
already supplying 2 Italian sites. Total global electricity from
100% renewable sources is now 64%. LSEG is engaging withlandlords at other sites to review potential to switch theselocations to 100% natural renewable energy.

To demonstrate commitment to ongoing environmental
improvements both within LSEG Property Services and supply
chain, a review of all property management activities was carriedout to identify areas where real gains could be made in thesustainability performance for LSEG properties. This wasachieved using the ISO 14001:2015 Standard as the framework
for the improvement activities. The key benefits are reduced
energy demand within buildings and more environmentally
responsible processes for the management of waste materials.
Supply chain engagement also improved, with service partners
being key contributors in the success of the project.

External recognition for commitment to environmental
management
The improvements were externally verified by a global
LSEG’s Property Services function in the UK achieved certification certification body and LSEG was awarded certification into the internationally recognised Standard for Environmental
December 2017.
Management, ISO 14001:2015.

LSEG recognised for commitment to sustainability
In the latest edition of the annual FTSE 100 Sustainability
Reporting Performance report, published by Carbonclear, LSEG’scommitment to sustainability performance and disclosure wasrecognised, with LSEG moving into the top 20, at joint 13th. We
top the financial services sector with a score of 66% against thesector average of 45%.

29

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services

Our People

2017 Review
Our Communities

Performance

Appendix

Our Communities continued
Community contributions from the Group in 2017
Based on the London Benchmarking Group (LBG)
methodology, we report our donations and otherfactors that reflect the Group’s overall engagementwith our communities.

How LSEG Foundation’s strategy aligns to our business priorities

Empowering people. Enriching communities.

In 2017, the Group made an overall donation to LSEG
Foundation of £1,122,000 which is 17% higher than 2016.
An additional £107,000 was donated directly to charities
by the Group, bringing total donations to £1,229,000,
12% higher than 2016 spending. The 2017 Charity Trading
Day raised £509,000 for LSEG Foundation, which will be
distributed to charities over the course of 2018.
Principal sources of funding 2017

Employees

The Group donates the equivalentof all equity trading fees raised on
London Stock Exchange, Turquoise
and Borsa Italiana during the annual
Foundation Day

Corporate

The charitable donations from othercompanies in the Group contributeto the Foundation’s donation pool
Money received through fines leviedby the Group
2017
£’000

2016
£’000

2015
£’000

Donations to LSEG Foundation

1,122

962

1,080

Donations to charity

107

133

1,074

In-kind donations

136

153

131

218

219

Management costs

238
1,603

1,466 2,5041

1. Variance in donations from 2015-2016 are due to the sale of Russell
Investment Management

2. Help more young people access the job market,
overcoming barriers posed by their condition

2. Developing a partnership approach

3. Help more young people aspire to become
entrepreneurs, as a way of expanding theirlife opportunities

3. Driving global growth

Impact of LSEG Foundation grant on beneficiaries
12%24%
Behaviour or attitude change
Skills or personal effectivenessQuality of life or wellbeing

Encouraging growth. Expanding opportunities.

We also identified a further 3 elements connected toour community engagement: in-kind donations, freevenue hire for charities at our premises in the UK and
Italy; management costs, the cost of time of the managers
involved in our Board of Trustees; and, charity committees
across the Group, our Foundation’s programme officeand the corporate functions that support staff
engagement programmes.

LSEG community investment
charitable donations

Total

Business Priorities
1. Delivering best in class capabilities

64%

Employees make donations andorganise fundraising events

Foundation
Day

Fines

Foundation Priorities
1. Help young people realise their potential, despite
their situation or disadvantage

life or wellbeing’ fraction covers donations made toorganisations such as UNICEF Children’s Emergency
Fund and Habitat for Humanity Sri Lanka in responseto emergencies.

Donations from LSEG Foundation
Total grants approved and paid amounted to £1.426 million,
broadly similar to the prior year amount (£1.479 million).
In addition to grants to partner charities across France,
Italy, the US and the UK, and the major grant to the Group’s
global partner charity UNICEF, 37 grants for charities wereidentified and put forward to LSEG Foundation by LSEG
employees across Australia, France, Italy, Sri Lanka, the UK
and the US. This amount included small grants disbursed
as part of the LSEG Staff Matching scheme, which doubles
employee-raised funds up to £2,000 (€2,000 in Italy) per
year, per person. In 2017, a record £105,000 was raisedby our employees and matched by LSEG Foundation.
Impact reporting
Given the bottom-up approach adopted for the selection ofprojects for local charitable grants, this year we have placed
particular importance on the measurement of our donations’impact and their consistency with LSEG Foundation’s cause.
Based on the LBG impact reporting framework, we ask
charities to report on 3 types of impact to help aggregation
across different project categories.

1. Behaviour or attitude change
Has the activity helped people makebehavioural changes that can improvetheir life or life chances or has it challenged
negative attitudes or preconceptions,enabling them to make wider, different ormore informed choices?
2. Skills or personal effectivenessHas the activity helped people to develop
new, or improve existing, skills to enable
them to develop in the workplace,academically or socially?
3. Quality of life or wellbeing
Has the activity helped people to behealthier, happier or more comfortable(e.g. through improved emotional, social
or physical wellbeing)?
88% of LSEG Foundation grants were directed to projects
that are in line with LSEG Foundation’s mission, called‘impact areas’. Those aimed at behaviour or attitudechange, termed ‘raised aspirations’, accounted for 24% ofgrants, and those aimed at the development of skills andpersonal effectiveness accounted for 64%. The ‘quality ofWithin impact areas 1 and 2 (‘Behaviour or attitude change’and ‘Skills or personal effectiveness’), donations are
perfectly aligned with our mission. Three quarters of the
donations are aimed at increasing the employability of thebeneficiaries or at developing financial or business skills,
for which the UNICEF Zambia project plays a large role.
25% is focused on developing life skills.
Target skills to be developed with our donation
25%
Employability or enterprise skills
Life skills

75%

In 2018, we aim to set targets to further sharpen the impact
and strategic alignment of the Group’s charitable giving.

30

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy
Our Markets

Our Services

Our People

2017 Review
Our Communities

Performance

Appendix

Looking ahead
As our business expands and diversifies,
we continue to review our approach tosustainability. In the coming year, as partof a strategic approach based on 6 revised
impact areas, we plan to promote sustainablebusiness that underpins the UN Sustainable
Development Goals and links with our pillar
sections in the following ways:

PillarImpact area

Objective

Our Markets
Our Services

Grow
ConveneDisclose
Transition– Develop an integrated programme and campaign promoting and supporting thetransition to a sustainable and low carbon economy through our Global Sustainable
Investment Centre

Our People
Our Communities

Develop
Sustain– Develop tools and plans to support the implementation of the final recommendationsof the Financial Stability Board’s Task Force on Climate-related Financial Disclosures– Identify a set of medium and long-term focus areas to inform the Group corporate
sustainability programme in the long run– Develop greater focus within the Group sustainability strategy on the Group’s culture
and value creation for stakeholders to align with Group strategy– Continue making progress towards the achievement of the 2020 targets1

1. Ongoing delivery

SDGs supported

Part 3:
Our overall Corporate
Sustainability performance

32

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Data Reporting Overview“LSEG actively supports thedrive for global alignment in
ESG reporting standards, forthe benefit of investors andcompanies. We also seek toimprove our reporting year on
year. Having recently launched
our ESG Reporting Guidance
for issuers, our own reporting
ambitions must reflect thehigh standards we advocate.”
David Harris
Group Head of Sustainable Business
It is becoming a norm that investors consider the ESG
performance of a company alongside other financial andstrategic information within their investment process. Asa leading international markets infrastructure provider,
we are keen to promote high ESG standards and ESG datathat is reliable, consistent and comparable across industries.
In light of this, we are committed to reflecting bestpractice in our own reporting. We conduct materiality
reviews before reporting to identify the importantmaterial standards and materials to adopt for LSEG. This
year, we have started to reference our own ESG Reporting
Guidance launched in February 2017 (more details onp.13), which are based on globally recognised standards.
We also draw from a range of international frameworks
and standards, many of which interrelate, including FTSE
Russell’s ESG methodology, TCFD, GRI Standards,
Sustainability Accounting Standards Board indicators,

CDP and UN Sustainable Stock Exchanges initiative. This year
we are starting to consider the recommendations from the
Financial Stability Board’s Task Force on Climate-related
Financial Disclosures (TCFD) (see p.14). Please see the
Appendix for a summary of LSEG data for the quantitative ESG
data points recommended in our ESG Reporting Guidance.
Based on these reporting frameworks, the following sections
outline a set of indicators, divided across Environmental,
Social and Governance areas, which we will continue tobuild on over time as our approach evolves.
While we expand as a Group with a number of newacquisitions and joint ownership initiatives, we alignour values and incorporate them into our ESG reporting
mechanisms during the integration. Acquisitions and Group
companies where we have below 100% ownership add
complexity to reporting ESG data, thus we have set out how
we have calculated Group-wide data in the relevant sections.
About this report
1. Scope and time frameThis report covers 100% of the businesses over which LSEG has
operational control (all legal entities in which LSEG has a 51%
stake or higher) employing the same principles as for financial
data. For a list of all the subsidiaries consolidated and coveredin the report, please see our Annual Report, p.158–161. When adifferent boundary applies to ESG data, we provide explanationsin the relevant section. Time frame matches the time period for
the Annual Report.

2. Verification and approval

All data included in this report has been submitted to aninternal verification process. Environmental, diversity andcash donation data has also been also externally verified.
The external verification statement for the environmental
data is published on www.lseg.com/home/about-london-stockexchange-group/corporate-responsibility/environment.
This report was approved by LSEG Board in March 2018.

3. Data provision

We provide both raw and normalised data where relevant(see Environment section), and wherever possible we provide
4 year time series of comparable data.

Our ESG practices are measured by a variety of assessments including performance indices and benchmarks.
These assessments provide useful input to benchmark against global best practices and to plan for improvements
in our sustainability approach.
Assessment

Benchmark

2017

2016

2015

2014

ESG Rating Absolute Score (5 – Highest)
ESG Rating ICB Supersector Relative Percentile
The FTSE4Good Index Series is Score (100 – Highest)
designed to identify companies Pillar Exposure (3 – Highest)that meet globally recognised
Environmental
ESG standards
SocialGovernance
Pillar Score (5 – Highest)
Environmental
SocialGovernance

4.6
99

4.5
100

3.8
99

4.3
100

1.0
2.0
2.3

1.0
2.0
2.3

1.0
2.0
2.3

1.0
2.0
2.3

5.0
4.3
4.7

5.0
4.5
4.3

5.0
3.2
3.9

5.0
3.8
4.3

71 (89th)

69 (83rd)

61 (80th)62 (84th)

75 (95th)
83 (93rd)
58 (84th)

77 (88th)
83 (97th)
50 (78th)

68 (76th)
73 (91st)46 (76th)

73 (85th)
75 (93rd)
40 (68th)

A-

A-

99B

96B

FTSE Russell ESG

Dow Jones Sustainability
Indices (DJSI)The Dow Jones Sustainability
Indices comprise global
sustainability leaders as
identified by RobecoSAM
CDP

Total sustainability company score (Percentile
Ranking)1
Economic (Percentile Ranking)1
Environmental (Percentile Ranking)1
Social (Percentile Ranking)1

Overall score

CDP, formerly known as the Carbon Disclosure Project, runs the global disclosure system that enables companies, cities, states andregions to measure and manage their environmental impacts. We were scored in the ‘leadership’ bracket for the fourth year running,highlighting the steps LSEG has taken which represent best practice in the field of environmental management
1. A higher percentile indicates a higher score and better performance

33

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Environment
LSEG is committed to utilising resourcesin ways that ensure the long-termsustainability and profitability of thebusiness and that benefit the environment.
The Group’s primary environmental impacts arise from ouroffices and data centres that host nearly 5,000 employees
around the world, from staff travel and, indirectly, from our
supply chain. We are aware of the risks and opportunities
of climate change for our business and our clients, and theneed to adapt our operations to prepare and take advantageof these.
The reporting period was the Group’s fourth year of setting
and reporting against environmental targets. We haveachieved our aims for 2017, and have now set long-termscience-based targets. More explanation and details of
our progress are outlined on the following pages.
Group reporting boundaries
LSEG uses the ‘Operational Control’ boundary for our
GHG and environmental reporting. An organisation has
operational control if it has, or its subsidiaries have, the fullauthority to introduce and implement its operating policies,
including health, safety and environmental policies, within
the operation. This approach accounts for 100% ofemissions from facilities, operations and vehicles (whether
leased or owned) over which LSEG has operational control.
The tables on the following pages summarise our relevant
environmental disclosure based on CDP, GRI and FTSE
Russell ESG indicators. We are considering the TCFD’s
recommendations (see p.14).

Methodology and verification
We report all of the emission sources required under theCompanies Act 2006 (Strategic Report and Directors’
Reports) Regulations 2013. These sources fall within
our consolidated financial statement. We do not have
responsibility for any emission sources that are notincluded in our consolidated statement.
The Scope 1, 2 and 3 emissions disclosed here and in
the Directors’ and Strategic Reports have been externallyverified by SGS against the requirements of the WRI/WBCSD
GHG Protocol – Corporate Accounting and ReportingStandard. Conduct of the verification met the requirementsof ISO 14064-3:2006. Full details and the verification
statement are available on our website.
Our emissions are calculated using GHG Protocol Corporate
Accounting and Reporting Standard (revised edition) and UK
Government Environmental Reporting Guidelines: Including
mandatory greenhouse gas emissions reporting guidance.
We use DEFRA UK Government GHG Conversion Factors
for our UK sites, and for extrapolated data, business travel,water and waste. Local GHG Protocol emissions factors areused to calculate energy emissions for international sites
where available.
Managing our environmental impact
Our Environmental Management Group (EMG) guides theGroup’s environmental strategy, and is responsible forsetting Group-wide targets, and managing and continuallyseeking to improve our environmental performance.
The EMG reports performance quarterly via our Intranet
and annually discloses verified emissions on our website,in our CS and Annual Reports, and in response to CDP,FTSE Russell and DJSI. Its responsibilities also include:– Increasing efficiency and reducing consumption
in areas including energy, water and paper usage,
waste management and business travel;– Ensuring that environmental considerations areincorporated in the Group’s purchasing policy andprocurement decisions, including new developments,
projects and materials;– Engaging with clients, suppliers and community partners
to promote environmental best practice.
David Warren, the Group’s Interim CEO and CFO, reports to
the Board on environmental issues.
HIGHLIGHTS

64%

Group electricity now from natural renewable sources

4thConsecutive year of recognition as an environmental leader
by CDPTop 20And first in sector for FTSE 100 Sustainability Reporting
Performance Benchmark1-31%

Reduction in absolute carbon emissions-54%

Data Centre energy tCO2e-8%

Air travel tCO2e per FTE-9%Office Space energy tCO2e

ISO 14001

Received ISO 14001 accreditation for UK property portfolio

Overall carbon footprint per FTE

Science-based targets
LSEG has become one of the first companies in the financial
services sector to set long-term science-based carbon
reduction targets. The official Scope 1 and 2 target, whichmeets the standards of the Science Based Targets Initiative(SBTI), is:

1. Sustainability Reporting Performance of the FTSE 100 – Carbonclear Sep 2016

– “London Stock Exchange Group commits to a 40%
reduction of their global Scope 1 and 2 GHG emissions
by 2030 from a 2016 baseline.”-42%

A Scope 3 target is being developed, and once this iscomplete all 3 Scopes will be verified by the SBTI.

34

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Environment continued
Overall Performance
During the reporting period, we achieved a 31% reductionin our absolute carbon footprint and a 42% reduction
in Carbon Emissions per Full Time Employee (FTE),
accelerating our progress from previous years. Thissignificant reduction is primarily attributed to our moveto 64% of the Group’s electricity now being provided bynatural renewable energy.

2020 Target: Reduce tCO2e by 20% per £m Revenue and per FTE
Progress against 2020 Target: -59% per £m Revenue and -56% per FTE
Disclosure
Carbon Footprint(tCO2e)We also implemented and received accreditation for our
ISO 14001 Environmental Management System by a
UKAS accredited body. The system initially covers the UK
property portfolio and we are assessing expansion to coverfurther locations.
In 2017, we also set new long-term, science-based targets(see p.33).

Data Centres
Data centre energy is the largest contributor to the Group
carbon footprint, and as of May 2017, this impact has been
dramatically reduced with a move to 100% renewableelectricity for our primary UK data centres, resulting in a 56%
reduction in tCO2e per occupied cabinet. We will further buildon this with increased moves to cold-aisle containment
in 2018. Diesel consumption was higher in 2017 due torunning of generators during infrastructure upgrades.

Fugitive Emissions

Indicator
Total Group Carbon Footprint
per m2
per FTEper £m Revenue
Scope 1
Scope 2 – Market Based
Scope 2 – Location Based
Scope 3
Scope 3 (Electricity T&D)
Data Centres
Offices
Tenants
Emissions from Aircon & Refrigeration

2017
tCO2e
21,902
0.236
3.99
11.21
1,918
11,74921,958
7,320
915
7,008
7,265
545

2016
tCO2e
31,688
0.351
6.91
19.10
1,583
21,73823,1206,572
1,795
15,450
8,315
1,538

2015
tCO2e
31,974
0.393
7.72
22.54
1,094
22,80924,404
6,318
1,753
15,940
8,352
1,671

88.7

114.3

127.7

Performance against 2017 target
TargetActual-42%-2%
tCO2e per FTE
tCO2e per FTE-2%
tCO2e per £m Revenue-41%
tCO2e per £m Revenue

2020 Target: Reduce tCO2e and Water by 20% per £m Revenue
Progress against 2020 Target: -72% tCO2e and -34% m3 per £m Revenue
Disclosure
EnergyWater(m3)

Indicator
Electricity (kWh)Natural Gas (kWh)Diesel (litres)
Total tCO2e
per occupied cabinet
per £m Revenue
Data Centres
per occupied cabinet
per £m Revenue

2017
2016
2015
Unit
tCO2e
Unit
tCO2e
Unit
tCO2e
36,270,505
6,638 35,084,718 15,023 33,093,661 15,609
1,301,549
240 1,225,793
226 1,427,685
263
44,755116
32,70885
21,31855
6,994
15,334
15,927
4.99
11.23
13.21
3.58
9.25
11.23
39,164
13.5
37,79013.0
36,276
12.5
27.91
27.66
30.08
20.04
22.80
25.57

Performance against 2017 target
TargetActual-2%-56%
tCO2e pertCO2e peroccupied cabinet
occupied cabinet

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Environment continued
OfficesDuring 2017, we continued to make incremental energy
savings through LED lighting replacements and otherefficiency initiatives, however these gains were dwarfed
by a move to 100% renewable electricity for our controlled
UK offices and an additional site in Italy. Natural Gas
consumption was higher than normal in 2017 due toa landlord meter fault at a site in Italy, which has since
been resolved.

2020 Target: Reduce tCO2e and Water by 20% per £m Revenue.
Progress against 2020 Target: -48% tCO2e and -40% m3 per £m Revenue
Disclosure
EnergyWater(m3)

Business Travel
LSEG continues to review and extend the use and availabilityof video conferencing (VC) facilities, and to encourage the useof VC in place of air travel. Train travel is the preferred option
between a number of major European hubs. Over the last year,
we significantly exceeded our target of a 10% increase in
VC call hours (49%). Air travel per FTE also exceeded its 2%
reduction target, achieving a 6% reduction per £m Revenue.
In 2017, we changed part of our vehicle fleet to be electric(charged using 100% renewables), and are investigating
options to switch the remaining fleet.

Indicator
Electricity (kWh)Natural Gas (kWh)
LPG (tonnes)
Diesel (litres)
Total tCO2e
per FTEper £m Revenue
Energy use from Renewable Sources
Office Space
per FTEper £m Revenue

2017
2016
2015
Unit
tCO2e
Unit
tCO2e
Unit
tCO2e
21,292,703
5,504 19,444,263
6,504 19,015,195
7,311
6,183,674
1243 4,113,675
822 1,931,365
382
10
31
13
37
10
31
43,268115
71,031
190
61,659
164
6,893
7,553
7,888
1.26
1.65
1.91
3.53
4.56
5.56
47%
20%
20%
62,64721.5
56,29919.3
46,301
15.9
11
12
11
32.05
33.97
32.64

Performance against 2017 target
TargetActual-2%-24%
tCO2e per FTE
tCO2e per FTE-2%
m3 per FTE-7.1%
m3 per FTE

2020 Target: Reduce tCO2e by 20% per £m Revenue and per FTE.
Progress against 2020 Target: -26% per £m Revenue and -19% per FTE.
Disclosure
Air Travel(km)Rail Travel(km)Road Vehicles
Video Conferencing

Indicator
International
Long Haul
Medium Haul
Short Haul
Total km
per FTEper £m Revenue
Eurostar
National Rail
Total tCO2e
per FTE
Company Leased Fleet (Diesel litres)
Number of Conferences
Conference Duration (Hours)

2017
2016
2015
Unit
tCO2e
Unit
tCO2e
Unit
tCO2e
3,667,592
350 8,611,245
815 9,925,739
951
31,394,971
5,653 25,456,946
4,642 22,657,714
4,186
5,185,352
445 4,698,111
420 4,601,109
414
4,235,405
599 3,207,159
473 2,696,238
425
44,483,319
7,047 41,973,461
6,349 39,880,800
5,977
1.28
1.39
1.44
3.61
3.83
4.21
502,907
5.8
636,7206.7
502,9078.8
775,16132.1
689,01929.7
597,26525.8
1,278,068
37.9 1,325,739
36.4 1,100,172
34.5
0.00690.00800.008423,93364.1
29,52479
15,77942.2
19,24014,786
12,621
38,581
25,884
20,278Performance against 2017 target
TargetActual-2%-5.9%
tCO2e per £m Revenue
tCO2e per £m Revenue+10%
total call hours+49%
total call hours

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Environment continued
Waste and Paper
LSEG continues to achieve 99% landfill avoidance, and total
waste produced per FTE has reduced by 13%. This is largely
driven by improvements in the waste management process
in the UK including introduction of a baler and new foodwaste processes – adding to an innovative food waste
solution in Italy.

2020 Target: Reduce Total Waste by 20% per £m Revenue.
Progress against 2020 Target: -69% per £m Revenue.
Disclosure
Waste(tonnes)In our second year of setting a paper reduction target, weachieved a 2% reduction in A4 sheets per FTE (target -5%
per FTE), building on a 29% reduction in 2016. A new print
management system is being further rolled out, and an
ongoing push towards paperless processes is expected todriver further reductions in 2018.

2017
Unit
tCO2e
946
198
0.17
0.036
0.48
731
211
23.9
71.2
1.7
11.3
103
99.70%
11,339,005
2,065

Indicator
Total Waste Produced
per FTEper £m Revenue
Total Waste for Energy
Total Waste Recycled– Food and Drink– Paper & Cardboard– Plastics– Glass– Mixed Recycling
Paper

Landfill Avoidance
Sheets of A4
per FTE

2016
2015
Unit
tCO2e
Unit
tCO2e
904
153
905
278
0.20
0.033
0.22
0.067
0.55
0.64
667
631
234
271
20.6
49.2
38.1
44.5
1.5
1.2
11.2
16
162
160
99.80%
99.60%
9,618,326
12,450,315
2,099
3,008

Performance against 2017 target
TargetActual-2%-12.7%
tonnes per FTE
tonnes per FTE-5%sheets of A4 per FTE-1.6%
sheets of A4 per FTE

Notes:
1. All Group totals and electricity breakdowns use market-based Scope 2 emissions factors
2. Scope 1 includes combustion of fuel and operation of facilities including Natural Gas, Diesel, LPG, Fugitive Emissions and Fleet Vehicles
3. Scope 2 is purchase of electricity by the Group for its own use (The Group does not purchase heat, steam or cooling)
4. Scope 3 includes emissions from Air Travel, Rail Travel, Waste, Water and Scope 3 Electricity Transmission and Distribution
5. Group Carbon Footprint includes tenant consumption. Detailed section data excludes tenants
6. Market-based emissions use grid average emissions factors except for renewable energy supplies. Residual factors will be updated for 2018
7. Total extrapolated emissions -4.63%
8. Only 4 sites are able to provide Fugitive emissions data from suppliers. All other sites excluded
9. 2016 and 2015 figures have been updated on receipt of annual emissions factor guidance and actual data from suppliers

2018 Targets
We have set ongoing targets for all of our impact areasfor 2018 compared to 2017, alongside our new long-termscience-based targets (see p.33).
We are aware of the risks and opportunities for our businessarising from climate change, and have developed measures
to address them. We will actively monitor these changes so
we can adapt and respond as necessary. Direct climatechange costs for the Group arise from the carbon tax
associated with the UK CRC Energy Efficiency scheme.

Carbon Emissions

5%(tCO2e/FTE/£m Revenue)

Business Travel Carbon

Video Conferencing(tCO2e/£m Revenue)(Total call hours)

2%5%

Other Environmental Impacts
Waste Production(tonnes/FTE)

2%

Water Consumption(m3/FTE)

2%Paper Consumption(A4 Sheets/FTE)

2%

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Social
Our social performance tables summarise
our social disclosure based on global
standards, and in particular draw from
GRI and the FTSE Russell ESG indicators,aligning with the recommendations in
our Group’s ESG Reporting Guidance.
Please see ‘Our People’ section andappendix for further details on our policies
and activities related to our employees.

2017 Group statistics1, 2
Disclosure
Employment

LSEG’s human rights policy statement is included in
the Group Corporate Responsibility policy approved by
the Board in 2016 and incorporated into our Supplier
Code of Conduct.
Progress was made in 2017 to further embed the respectfor human rights in our operations and business conduct.
1. LSEG ESG Reporting Guidance
Our guidance on reporting ESG information provides specificguidance on human rights disclosure, based on FTSE
Russell’s ESG methodology. It explains the investment caseand the sources of investment risks, and provides example
indicators of practice and performance.
See p.17 of the LSEG ESG Reporting Guidance for humanrights guidance at www.lseg.com/esg.

Health and safety4
Training and education
Labour standards
Diversity and equal
opportunity

2. Implementation of the UK Modern Slavery Act
During 2016 LSEG amended its standard supplierframework terms to specifically address modern slavery,
and our procurement team undertook a broad reviewof the existing supplier base for modern slavery risks,
focusing on the suppliers that made up the top 75% ofspend. More details on the steps taken by LSEG to countermodern slavery are shown in the full ‘Slavery and Human
trafficking statement’ at www.lseg.com/about-londonstock-exchange-group/corporate-responsibility/
modern-slavery-act-statement.

Non-discrimination
1. Figures as of year end 31 December 2017
2. Owing to rounding, some totals may not correspond with the sum of the separate figures
3. Malaysian employees acquired as part of Mergent. No past data available
4. 100% of the total workforce were represented in formal joint management-worker health and safety

Indicator
Employees by region
United Kingdom
Sri Lanka
United States of America
Italy
RussiaFranceMalaysia3
Other
Total
Employees by contract type
Full time
Part time
Fixed term
Total
Employees covered by collective bargaining agreements
Staff voluntary turnover
Number of health and safety incidents
Employees receiving regular performance and career development reviews
Total hours spent on employee development training
Number of incidents of labour standards non-compliance
Employees by region
United Kingdom
United States of America
FranceItaly
Sri Lanka
Other
Total
Group by gender and organisational level
LSEG plc Board
LSEG Subsidiary Boards5, 7
Executive Committee and Leadership Teams6, 7
All Staff
Total
Employees by age group
Under 30 years
30–50 years
Over 50 years
Total
Nationalities represented in the Group
Total number of incidents of discrimination and actions takencommittees. The health and safety committee is chaired by the Head of Group Property
with departmental representation from across the global business in multiple jurisdictions
5. Mix of employees and Non-Executive Directors
6. Executive Committee and Leadership Teams in LSEG

2017

%

2016

%

2015

%

2014

%

1,596
1,036
657
625
555
171
121
147
4,908

33
21
13
13
11
3
2
3
100

1,408
1,030
249
586
435
174
–
94
3,976

35
26
6
15
11
4
–
2
100

1,549
833
1,305
578
318
182
–
480
5,245

30
16
25
11
6
3
–
9
100

1,502
670
1,308
546
–
169
–
–
4,656

32
14
28
12
–
4
–
–
100

4,683
95
3,808
96
4,891
93
4,328
93
104
2
91
2
171
3
116
2
121
3
77
2
183
4
212
5
4,908
100
3,976
100
5,245
100
4,656
100
16%
20%
15%
15%
9.5%
5.6%
9.9%
8%
0
3
0
1
100%
100%
100%
100%
41,67530,000
N/A
N/A
0
0
N/A
N/A
2017
2016
2015
2014
% Female% Male % Female% Male % Female% Male % Female% Male
33
68
32
68
33
67
33
67
35
65
33
67
39
61
40
60
39
61
37
63
38
62
38
62
38
62
38
62
39
61
38
62
24
76
18
82
18
82
17
83
40
60
34
66
38
62
43
57
33
67
30
70
33
67
34
66
FemaleMale
FemaleMale
FemaleMale
Female
Male
2
9
1
10
3
11
3
11
23
142
17
128
21
181
10
93
146
303
111
252
15
65
11
48
1,458
3,001
1,085
2,528
1,741
3,424
1,593
3,004
1,604
3,304
1,196
2,780
1,756
3,489
1,604
3,052
Total % Female
Total % Female
Total % Female
Total % Female
1,540
31
1,357
34
1,396
27
941
20
2,740
56
2,204
55
3,157
60
3,067
66
628
13
415
10
692
13
648
14
4,908
3,976
5,245
4,656
728
59
55
51
0
0
0
0
7. The LSEG Subsidiary Board members and the Executive Committee and Leadership Teams together
comprise the ‘Senior Managers’ for the purposes of section 414C(18)C(11) of the Companies Act 2006
8. Not a required disclosure, and therefore represents 76% of staff who disclosed this information

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Governance
LSEG is committed to the corporate
governance standards set out by the UK
Corporate Governance Code, which in 2014
was updated to strengthen the focus on
long-term sustainable value creation.
The purpose of this section is to provide disclosure on
governance practices that are particularly relevant tosustainability issues deemed significant by our stakeholders.
For 200 years, we have abided by our motto, Dictum Meum
Pactum, ‘My word is my bond’. Today, it is as vital as everthat we maintain the highest standards of ethics andgovernance. Given our central role in a constantly evolving
global economic landscape, it is important that we foster
confidence in our markets and in the services we provide.
What we believe as a Group and how we act issummarised by our 4 core values and behaviours:
Integrity, Partnership, Innovation and Excellence.

Integrity

Partnership

Innovation

Excellence

My word is my bond

We collaborate
to succeed

We nurture newideas

We are committed
to quality

Integrity underpins allthat we do – from ourunshakeable commitment
to building and supporting
global markets based ontransparency and trust, toevery transaction acrossour business with eachand every stakeholder. We
are a source of enduringconfidence in the financial
system, so when we saythat our word is our bond,
we mean it.

We pride ourselves on
working together as
proactive partners, building
positive relationships withour colleagues, customers,
investors, regulators,
governments andshareholders, for ourmutual success and thebenefit of all.

We are ambitious andforward-looking – a pioneeringGroup of market innovators,
driven by fresh thinking thathas kept us ahead of change.
We prudently and proactively
invest to make sure that ourmarkets and services areconstantly developing
and evolving with advancesin technology.

We have a fundamental
commitment to developing
talented teams who deliverto the highest standards
in all that we do. Bycollaborating together, we
will sustain industry-leadinglevels of excellence, setting
the benchmarks that inspire
ever-better performance.

HIGHLIGHTS

100%

Employees successfullycompleted mandatory Anti-Bribery
and Corruption training in 2017

100%

LSEG businesses self-certified ascompliant with our Anti-Bribery
and Corruption policies

Over 500
Investor meetings held in 2017

Further information:
For a full description of LSEG’s corporate
governance framework please see the2017 LSEG Annual Report.
You may also refer to the GRI Index
available at: www.lseg.com/about-londonstock-exchange-group/corporateresponsibilty.

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Governance continued
Corporate responsibility and oursustainability strategy are overseen by
the LSEG Board. Our CEO is responsible forreporting to the Board on sustainability
matters, while the Group CFO, who is a
Board member, has responsibility for theenvironmental policy.

Our sustainability strategy is driven by the Group Corporate
Responsibility Committee, on which Executive Committee
members and an LSEG Board member sit.
Delivery of the sustainability programme is carried out by the
Sustainable Business team, reporting to Investor Relations.

Tax transparency
LSEG’s strategy for taxation has been published and is availableat www.lseg.com/about-london-stock-exchange-group/
regulatory-strategy/london-stock-exchange-tax-strategy.
The strategy is centred around 4 concepts:
1. To ensure that the Group fulfils its fiscal obligations withregard to the administration and payment of all taxes.
2. To ensure that the Group’s tax affairs are arranged inan efficient manner, whilst remaining compliant withthe tax laws of the jurisdictions in which it operates.
3. To support the delivery of the Group’s corporate andrisk management strategies.

Sustainability governanceOversight

Execution

LSE Group Board
LSE Group ExCo

Chair of LSEG CR Committee

LSE Group CR Committee

Pillar leaders + cross-businessCR working groups

Ratings agencies

Sustainable Business Team

Deliverable
LSE Group CS Strategy

We disclose UK tax charge and overseas tax charge inthe cash flow statement of our Annual Report. LSEG
is also a signatory of the UK Prompt Payment Code.

CS pillar strategies

Our Markets

Our Services

Our People

Our
Communities

Management and reporting
External validation

ExCoGroup Head of Comms
Group Head of IR

4. LSEG does not undertake purely artificial transactions
in order to obtain a tax benefit and will only enter intotransactions which would be fully justifiable should
they become public. Furthermore, all transactions musthave a business purpose or commercial rationale.

Communications strategy

Cyber security
Cyber security is increasingly identified by investors asa key non-financial sustainability risk in the financial
sector with broad impacts on a number of stakeholders.
Our reputation and ability to fulfil our purpose as a vital
markets infrastructure provider is dependent on our securemanagement of data and financial assets. In order to haveconfidence in our data and assurance of financial assets,
we have controls that protect the confidentiality, integrity
and availability of LSEG and Group company assets
including preventing unauthorised use or modification.
Given the increased size and scope of our businesses, weface a wide and expanding universe of risks. In particular,
our critical role as a markets infrastructure provider gives
us exposure to technology risks such as cyber threats,systems resilience and technological innovation. The Groupis reliant upon secure premises to protect its employees andphysical assets as well as appropriate safeguards to ensure
uninterrupted operation of its IT systems and infrastructure.
The threat of cyber crime requires a high level of scrutiny as
it may have an adverse impact on our business. Long-term
unavailability of key premises could lead to the loss of client
confidence and reputational damage.
Security threats are treated very seriously. The Group has
robust physical security arrangements, and extensive IT
measures are in place to mitigate cyber security risks.
The Group is supported by the Centre for the Protection of
National Infrastructure (CPNI) in the UK, with both physicaland IT security teams monitoring intelligence andliaising closely with police and global Government
agencies. A third party security monitoring service isretained to assist with monitoring global physical security
events with the potential to impact Group operations. The
Group has well established and regularly tested business
continuity and crisis management procedures. The Grouprisk function assesses its dependencies on critical suppliersand ensures robust contingency measures are in place.
Please see the ‘Key policies’ on p.40 for a descriptionof the Technical Information Security and BusinessContinuity policies.

40

London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Governance Key policies
Our Code of Conduct and Corporate
Responsibility policies, both published onwww.lseg.com, are underpinned by LSEG’svalues and behaviours and a number ofpolicies that embed sustainability into
our day to day operations.
Given their relevance for our industry and associated risks,
we provide below a brief description of the following policies:
1. Financial crime
2. Anti-bribery and corruption
3. Technical information security
4. Business continuity management
5. Representation

1. Financial crimeThis policy outlines the approach and arrangements that
LSEG has in place to prevent the occurrence, facilitationor furthering of financial crime. It also sets out LSEG’s
approach to compliance with applicable legislation,
regulation and guidance.
The detection, disruption and deterrence of financial
crime is a key objective for many regulators worldwide
and continues to be a high priority for governments.
Consequently, financial crime poses a continuous
reputational, regulatory and legal risk to LSEG. In addition
to the reputational and financial loss caused by financial
crime, a failure to establish adequate controls to manage
our risk and ensure those controls are effective exposes thegroup and approved persons to civil and criminal sanctions
including heavy fines, restrictions on business activity andloss of relevant regulatory authorisation.
LSEG is committed to supporting government, law
enforcement and international bodies to combat the useof the financial services sector to facilitate financial crime.

2. Anti-bribery and corruption
Consistent with LSEG’s strategic risk objective of
maintaining stakeholder confidence, we regularly review
both the risks associated with our business conduct andour related policies. As a result, LSEG has in place a Codeof Conduct, Anti-bribery and Corruption and conflict ofinterest policies, approved by the Board. In 2017, we carriedout mandatory anti-bribery and corruption compliancetraining, with 100% successful completion; and, thenumber of staff disciplined or dismissed due to noncompliance was zero. Based on FTSE Russell’s 2017
ESG assessment, LSEG’s industrial and geographic
exposure to the corruption theme is medium (2 out of 3).
Our Anti-bribery and Corruption policy is available atwww.lseg.com.
3. Technical information security
This policy outlines the Technical Information Security
requirements across LSEG. It addresses a number of risks,
including data loss or theft which could result inunauthorised access to systems or company information;
the threat of malware (such as viruses, worms, spyware,
Trojans and other threats); and, the loss or unauthorised
alteration of company data, including personal andconfidential information which could expose LSEG to
the risk of non-compliance with legal obligations ofconfidentiality, data protection and privacy.

4. Business Continuity Management (BCM)
LSEG is committed to minimising the impact to markets,
customers and other stakeholders arising from any event
which causes disruption. To achieve this the Group has
established BCM as an integral part of its business operations.
BCM is a management process that identifies potential threatsto an organisation and the impacts to business operations
those threats might cause. It provides a framework forbuilding organisational resilience with the capability for aneffective response that safeguards the interests of its key
stakeholders, reputation, brand and value-creating activities.
BCM includes all activities relating to:– business recovery planning;– IT service continuity planning (including disasterrecovery); and– crisis management.
The purpose of this policy is to ensure that the Group has afeasible, practical, cost-effective and tested BCM Frameworkand that controls exist which ensure that the Group operates
within its overall risk appetite.

41
Overview

London Stock Exchange Group plc Group Corporate Sustainability Report 2017
Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Governance Sustainable policy engagement
1. EU High-Level Expert Group on Sustainable Finance
LSEG played a major role throughout 2017 as a member ofthe expert body advising the European Commission on how
to integrate sustainability considerations into its financial
policy framework in order to mobilise finance forsustainable growth.
The High-Level Expert Group (HLEG), comprised of 20
senior experts, including the Group Head of Sustainable
Business from LSEG, was drawn from the civil service, thefinance sector and academia as well as a limited numberof observers, was asked to provide recommendations to
the Commission, which would feed into the EU’s action
plan, leading to concrete legislative proposals.

The key outcome of the HLEG’s work are recommendations
to the European Commission and the policy makers on:– Establishing an EU sustainability taxonomy, alignedwith the Paris Agreement but also the Sustainable
Development Goals.
– Clarifying investor duties to extend the time horizonsof investment and bring greater focus on ESG factors
into investment decisions.
– Upgrading disclosures to make sustainability
opportunities and risks transparent.
– Empowering retail investors to invest in sustainablefinance opportunities.
– Developing official European sustainability standards
for some financial assets, starting with green bonds.
– Establishing ‘Sustainable Infrastructure Europe’ todeploy development capacity in EU member states forinfrastructure necessary for a more sustainable economy.
– Integrating sustainability firmly in the governanceof financial institutions and in financial supervision.
(Fit and proper tests to include an assessment of
the individual and collective ability of members ofgoverning bodies in financial institutions to address
sustainability risks).

2. Lujiazui (LJZ) Green Finance Council
The LJZ Green Finance Council is an important working
group for promoting green and ESG disclosure by listedcompanies, on which LSEG is a representative. In thelast 2 years China and the UK have been building aclose partnership in green finance, and the involvementof LSEG on the LJZ Council highlights this partnership.
3. LSEG representation on Green Finance Task Force
LSEG is a member of the UK Government’s Green Finance
Task Force, and is represented by the CEO of LSE. The Task
Force was established by ministers from HM Treasury andthe Department for Business, Energy and Industrial
Strategy in September 2017, and is intended to accelerate
growth of green finance and the UK’s low carbon economy.
The Task Force aims to deliver ambitious proposals toaccelerate investment in the transition to a low carbon
economy, creating high-value jobs and opportunities for
UK businesses. It will examine a range of interventions,from making infrastructure investment more sustainable
to scaling-up green mortgages.

4. G7 finance meeting
The G7 is supporting the growing movement to sustainable
powering of the financial system.
As part of the G7 green finance work stream, Borsa Italiana
hosted a meeting dedicated to Green Financial Centres.
Borsa Italiana also joined and co-chaired the working groupthat the Minister for the Environment, set up in July 2017,
to coordinate the creation of an Italian Sustainable
Financial Centre.

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Appendix i
UN SSE: Communication to stakeholders
Having joined the UN-backed Sustainable Stock Exchanges (SSE) initiative in 2014, LSEG has committed to reporting to the SSE stakeholders on an annual basis. The report provided below is in line with the template and structure developed by the SSE.
This is LSEG’s fourth report on progress.
Business Strategy

How does your exchange define and view the rationale
for corporate sustainability and the exchange’s role inpromoting it?

Our CEO’s message, CS strategy and Materiality review on p.2, 5 and 6, respectively, demonstrate our rationale for corporate sustainability and our role in promoting it.

How does your exchange’s senior leadership andorganisational structure support the promotion of
corporate sustainability in its market(s)?

Our sustainability strategy is developed and reviewed by ExCo and the Board respectively. Our organisational structure is set out on p.5. Our Markets and Our Services pillars support
the promotion of sustainability across capital markets globally, see p.10-18.

What goals/objectives does your exchange have inregards to advancing sustainability in your market?

The impact areas of our sustainability strategy that are more relevant here are Disclose, Convene, and Grow - please see the Our Markets and Our Services sections for more details(see p.10 and 15). We set out our specific objectives for 2018 in our Looking ahead section on p.30.

Transparency and Issuer Reporting

Describe your exchange’s approach to promoting
sustainability disclosure by companies.

We cover this across both Our Markets and Our Services. We encourage best practice disclosure in 3 ways. First, during 2016 we developed guidance on ESG disclosure for issuers of
all sizes across the UK and Italy, which was launched in February 2017 and can be accessed at www.lseg.com/esg. Second, FTSE Russell’s ESG services and the associated FTSE4Good
Index family set a standard for ESG disclosure globally. Third, we promote issuer-investor dialogue on ESG issues through capital markets events and our new online investor relations
platform Elite Connect. In July 2017, Borsa Italiana held its first Sustainability Day to encourage investor issuer dialogue on ESG issues (see p.14). In 2017, the CEOs of LSEG, London
Stock Exchange, Borsa Italiana and FTSE Russell signed the letter of support for the final recommendations of the Financial Stability Board’s Taskforce on Climate-related Financial
Disclosures (TCFD).

What is your exchange’s process for reviewing listing
standards in general? Are there opportunities forstakeholders to comment during the process?

The UKLA is responsible for listing standards in the UK not the London Stock Exchange. Borsa Italiana is responsible for setting and reviewing the listing standards of Directors’ and the
Italian financial markets supervisory authority’s approval. Borsa Italiana stakeholders can comment on the process of amending the listing standards, both the Rules of the Markets
and their implementing Instructions. For example, as part of its preparation of the modifications, Borsa Italiana shall consult relevant stakeholders, such as the industry associationsof issuers and intermediaries, in order to incorporate their comments and suggestions.

How do you track the sustainability reporting of yourlisted companies?

We track sustainability reporting in 2 ways: internally and externally. Internally, the FTSE ESG service tracks the level of ESG disclosure for our markets and for other markets aroundthe world. The report published by FTSE Russell in December 2016 saw LSE in 16th position and Borsa Italiana 9th. Externally, we review our progress against Corporate Knights
exchange rankings for sustainability disclosure. The 2017 report saw LSE reach the 4th position globally (up from 8th in 2016) and Borsa Italiana 21st (down from 19th in 2016).

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Appendix i continued
What incentives (i.e., public recognition/awards) andsanctions do have in place to encourage disclosure anddiscourage non-compliance/lower levels of transparency?

FTSE Russell assesses ESG and green revenues disclosure and performance of companies globally and provides this analysis to investors around the world. This data is also used toconstruct the FTSE4Good Index Series, which highlights companies that meet good practice standards, and the Environmental Markets and Green Revenues Index Series. FTSE Russell
also works with other exchanges.

What connections have you made between nationalsustainable development frameworks and goals, andyour exchange’s existing standards and norms?

LSEG’s ESG Reporting Guidance builds on national disclosure standards and norms across the UK and Italy. The EU Non-Financial Reporting Directive was transposed in the UK and
Italy during 2016, mandating public interest companies with more than 500 employees to disclose environmental, social, diversity, human rights and anti-bribery and corruption
information. The guidance also builds on the recommendations of the TCFD and the Sustainable Development Goals.

Issuer Capacity Building

If your exchange offers sustainability guidancefor companies, please provide a description of theprocess for its creation.

LSEG involved market participants in the creation of its ESG Guidance for issuers through investor and issuers workshops organised in the UK and Italy, and consulted other stakeholders(standard setters and responsible investment NGOs) before finalising the guidance.

Do you and/or your regulator provide guidance on
externally assuring ESG disclosures? In your market,
how common is external assurance of ESG disclosures?

Assurance of ESG disclosure is mandated in Italy and the UK as part of the implementation of the EU Non-Financial Reporting Directive. LSEG ESG Guidance recommends enhancing
the credibility of ESG information through internal and or external assurance (see the ‘Investment Grade Data’ chapter of the guidance).

Collaboration and Engagement

Who does your exchange view as its key stakeholders andhow does it engage and collaborate (or plan to do so) withthese and potentially other stakeholders?

We do this is a range of ways:– LSEG, in 2017, was involved in the EU High Level Expert Group on Sustainable Finance, in the UK Green Finance Taskforce, and in the G7 Green Finance workstream under the
Italian Presidency. We are working in a range of ways to support the growth and development of green finance and are represented on the City of London’s Green Finance Initiative
and as an observer of the Green Bond Principles;– we partner a large number of peer exchanges around the world and in some cases this explicitly covers ESG and ESG indices;– we respond to regulator consultations and have responded positively to consultations regarding issuer non-financial disclosure in the past;– we host events for issuers and ESG-related initiatives;– through FTSE Russell we are involved in a large number of investor ESG collaborative bodies and initiatives including the UN backed PRI, UK SIF, US SIF, Euro SIF, ICGN,Japan SIF and RIAA and through our involvement with the SSE initiative: in 2017, LSEG was part of the SSE Green Finance Advisory Group.

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Appendix i continued
Sustainable Products

How has your exchange supported the developmentof financial products that address sustainability-related
issues (e.g., ESG Indices, carbon markets, social/environmental bonds, sustainable development funds, etc.)?

In 2016, LSEG launched its Global Sustainable Investment Centre which aims to promote green and sustainable capital raising and deep integration of ESG consideration in theinvestment process across asset classes. The product portfolio includes green bonds in different currencies, renewable infrastructure funds, cleantech companies, green ETFs,
ESG indexes and analytics, FTSE Russell’s Green Revenues and analytics, and supporting tools such as LSEG ESG Reporting Guidance.

Exchange Needs

Are there any specific resources that you would
like from the SSE or other relevant groups to help
you in your sustainability work?

The agenda of the SSE has already moved beyond disclosure, addressing green finance. The next step could be to carry out work on SDG8 regarding decent work and growth, which
is one of the key SDGs identified by the SSE as relevant to exchanges.

Are there any specific requests you have of investors,
issuers and regulators in terms of their role in advancing
sustainability in the market?

LSEG looks forward to continuing collaboration with investors, issuers and regulators on the sustainable investment agenda. It is key to the continued success of ESG disclosurethat issuers perceive how investors are shifting capital allocation in response to ESG and low carbon economy considerations. Therefore, we will continue to place emphasis on theimportance of investor-issuer dialogue on ESG issues, as a complement to high-quality ESG data flows. LSEG welcomes the recommendations of the TCFD as a key development in thetrend toward the global alignment of ESG disclosure standards.

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities
Key:
LikelyPossible

Appendix ii
FTSE Russell quantitative ESG data points as referenced in the LSEG ESG Reporting Guidance
Indicator

Indicator sub code

Indicator description wording

2017

20161

Environmental

ECC14

Total operational GHG emissions data (Scope 1 & 2) is disclosed

13,667 tCO2e

23,321 tCO2e

ECC15

Total energy consumption data is disclosed

64,655 MWh

70,432 MWh

EPR18Disclosure of NOX emissions (tonnes)

Not significant

Not significant

EPR19

Disclosure of SOX emissions (tonnes)

Not significant

Not significant

EPR21

Disclosure of volatile organic compounds (VOC) emissions (kilograms)

Not significant

Not significant

EPR24

Disclosure of hazardous waste generation (tonnes)

Not significant

Not significant

EPR25

Disclosure of non-recycled waste generation (tonnes)

735 tonnes

6702 tonnes

EPR26

Disclosure of waste recycled (tonnes)

211 tonnes

2342 tonnes

EPR27

Total costs of environmental fines and penalties during financial year

0

0

EPR28

Percentage of sites covered by recognised environmental management systems such as ISO 14001 or EMAS

47%

N/A3

ESC30

Total GHG emissions data on properties disclosed

14,818 tCO2e

25,303 tCO2e

ESC31

Total energy usage data on properties disclosed

64,655 MWh

70,432 MWh

ESC32

Total water usage data from property portfolio disclosed

97,624 m3

109,243 m3

EWT11

Total water use/water extraction data is disclosed

97,624 m3

109,243 m3

EWT12Percentage of water recycled (non-potable) for use in own operations

Not significant

Not significant

Relevance

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Appendix ii continued
Indicator

Indicator sub code

Indicator description wording

2017

20161

Governance

GAC12Disclosure of total amount of political contributions made£0

The only political donations
made in 2016 amounted to
US$41,500 by Russell
Investments PAC, before its sale.
The Group has made no otherpolitical donations.

GAC13

Disclosure of number of staff disciplined or dismissed due to non-compliance with anti-corruption policy/policies

0

0

GAC14

Disclosure of cost of fines, penalties or settlements in relation to corruption

0

0

SHR17

Total amount of corporate or group donations/community investments made to registerednot-for-profit organisations£1.2 million4

Close to £1.1 million5

SHS12

Percentage of sites with OHSAS 18001 certification

6%

16%

SHS13

Number of staff trained on health and safety standards within the last year

100%6

100%

SHS15

Lost-time incident rate, over last 3 years

0

Not significant

SHS38

Number of work-related employee fatalities

0

0

SHS40

Number of work-related contractor fatalities

0

0

SLS24

Full-time staff voluntary turnover rates

9.5%

5.6%

SLS25

Percentage of employees that are contractors or temporary staff

3%

2%

SLS26

Amount of time spent on employee development training to enhance knowledge or individual skills, using:a) Total hours as a company, orb) Average hours per employeea) 41,675b) 8.5a) 30,000b) N/A

Social

1. 2016 figures have been updated and re-verified on receipt of annual emissions factor guidance and actual data from suppliers
2. 2016 figures reduced due to a supplier reporting error which has been corrected
3. ISO14001 system established and accredited for UK property portfolio in 2017

Relevance

4. This is the total cash charitable donation made by the Group in 2017, consisting of £1122,000 to LSEG Foundation and £107,000 to other charities (see p.29)
5. This is the total cash charitable donation made by the Group in 2016, consisting of £962,000 to LSEG Foundation and £133,000 to other charities (see p.29)
6. 100% of new staff received health and safety training

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London Stock Exchange Group plc Group Corporate Sustainability Report 2017

Overview

Corporate Sustainability Strategy

2017 Review
Our Markets

Performance
Our Services

Our People

Appendix

Our Communities

Appendix iii
Sustainable Development Goals
As the UN Sustainable Stock Exchanges initiative assesses
that exchanges are well placed to have a measurable
impact on 5 of the Sustainable Development Goals (SDGs),
we align our strategy to them. This is also one of theframeworks recommended in our ESG Reporting Guidance.

SDG

Goal

Associated targets

LSEG impact area

Gender equality

Ensure women’s full and effective participation and equal opportunities for leadership at all levels ofdecision-making in political, economic, and public life

DEVELOPSUSTAIN

Decent work andeconomic growth

Promote development-oriented policies that support productive activities, decent job creation,
entrepreneurship, creativity and innovation, and encourage the formation and growth of micro,
small and medium sized enterprises, including through access to financial services

GROW
SUSTAIN

Responsible
consumption andproduction

Encourage companies, especially large and trans-national companies, to adopt sustainable practices
and to integrate sustainability information into their reporting cycle

DISCLOSE
TRANSITIONCONVENE

Climate action

Improve education, awareness raising and human and institutional capacity on climate change
mitigation, adaptation, impact reduction, and early warning

DISCLOSE
TRANSITIONCONVENESUSTAIN

Partnership forthe goals

Enhance the global partnership for sustainable development complemented by multi-stakeholder
partnerships that mobilise and share knowledge, expertise, technologies and financial resources to support
the achievement of Sustainable Development Goals in all countries, particularly developing countries

DEVELOP
CONVENE© March 2018
London Stock Exchange Group plc
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Telephone +44 (0)20 7797 1000
Registered in England and Wales No. 5369106
www.lseg.com