A leading financial
markets infrastructureand data provider
London Stock Exchange Group plc
Group Sustainability Report 2020

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

CONTENTS
Introduction
02 Welcome to our 2020 Group Sustainability Report
04 Our response to Covid-19
05 Our Sustainability Strategy
06 Group at a glance
07 Looking ahead
08 Our approach to sustainability
09 Materiality review
10 Progress on our commitments
11 Sustainability ratings performance12	Enabling and supporting positive change
21 Being a responsible business
22 Environment: progress in 2020
26 Social
26 2020 initiatives
29 Diversity and Inclusion
33 LSEG Foundation
35 Governance
35 Sustainability governance
36 Sustainability risk management
37 Key policies and compliance
38 Human rights
39 Engagement with stakeholders
		and shareholders
40 Tax transparency

For further information,
visit: www.lseg.com

Refinitiv acquisition
This report describes the sustainability
performance and activities of LSEG as it wasin 2020 and therefore prior to the acquisition
of Refinitiv, which took place in January 2021.
Development of the new Group’s sustainability
approach will be shared during 2021.

About this report
1. Scope and time frameThis report covers 100% of the businesses over which LSEG
had operational control in 2020 (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 covered in the report, please see our Annual Report,
pages 192–197. When a different boundary applies to ESG
data, we provide explanations in the relevant section. The
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 externally verified.
The external verification statement for the environmental
data is published on www.lseg.com/investor-relations/sustainability. This report was approved by the LSEG Board
in March 2021.

41 Appendix: Detailed performance data
and reporting disclosures
42 Environment
49 Social
50 Governance
50 Sustainability risk
51 UN SSE: communication to stakeholders
54 FTSE Russell ESG data points
55 SDGs
56 TCFD
58 WFE principles
59 SASB

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

Investor Relations
London Stock Exchange Group plc
10 Paternoster Square
London EC4M 7LS

Email: ir@lseg.com
For a glossary of terms, visit:www.lseg.com/glossary

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Welcome to our 2020 Group Sustainability Reportto transform the global financial ecosystem and second,transforming our operations and culture while supporting
our wider communities. In 2020, our focus was on
helping to mitigate the devastating impact of theCovid-19 pandemic; promoting diversity and inclusion;and tackling climate change.

David Schwimmer
CEO

In 2020 our focus was on
helping to mitigate thedevastating impact of theCovid-19 pandemic; promoting
diversity and inclusion; andtackling climate change.”

Our 2020 Sustainability Report reflects the progressthat we, prior to acquiring Refinitiv, have made towards
embedding sustainability as an integrated andfundamental part of our strategy and culture. This
agenda continues to be a priority for me and for LSEG.
Positioned at the heart of capital markets, LSEG iswell positioned to drive long-term sustainable economic
growth, stability and resilience across global economies.
We partner across the marketplace, and with otherindustry leaders, to champion the role responsible
businesses and investors play in accelerating thetransition to a low-carbon, sustainable economy andpromoting good corporate governance. Our approachto embedding sustainability has two pillars: first, helping

2020 was unprecedented in the challenges presented
globally by the Covid-19 pandemic. Throughout, LSEG
has been focused on ensuring the welfare of ouremployees and continuity of services to our customers.
We have prioritised operational resilience; maintaining
access to our capital markets; managing risk through ourclearing operations; and providing important information
services to market participants. All our systems continued
to operate as normal, coping with the surge in volumes
seen in March 2020, as customers rushed to hedge
portfolios to manage risk. We also supported ourissuers by waiving fees for Covid-19 related social andsustainability bonds. £75 billion of Covid-19 bonds werelisted on London Stock Exchange, as at 31 December.
As important was ensuring the wellbeing and healthof our people who have had different experiencesof longer-term working from home under restrictedconditions. We managed to transition the majority of ourworkforce successfully to a remote working environment
and we continue to adapt our technology and working
practices to this changing environment. We also
made a conscious effort to ensure that employee careerdevelopment was not hampered by ensuring they had
the right support and access to resources. This has
included the successful transition of face-to-face training
onto virtual environments. We maintained our global

mentoring programme and launched “the Social Exchange”
so that colleagues could meet and engage with each other,share experiences, foster an environment of partnershipand collaboration, and encourage people to seek
diversity of thoughts and opinions.
LSEG is also committed to supporting the communities
in which we operate around the world, partnering with
global and local charitable organisations to further support
those impacted by Covid-19. In the UK and Italy we donated£1 million and €1 million respectively to support small andmedium sized businesses who faced significant hardshipas a result of the pandemic. We also donated a further£1 million to the Red Cross’ Emergency Appeal Covid-19
emergency fund. Through our LSEG foundation, we havedonated £420,000 around the world and are also
matching up to £120,000 of employee donations inrelation to Covid-19 relief. We recognise the importantrole that LSEG can play in the economic recovery,
empowering and enabling businesses and customers
to fund innovation, manage risk and create jobs, andwe continue to assess areas where we can provide
leadership and support.
Diversity and inclusion remains at the centre of ourculture of partnership and collaboration. Our Diversity
and Inclusion agenda is supported throughout theorganisation and we have laid some of the foundations
to improve diversity and strengthen racial inclusion.
In 2020, 50% of our senior manager joiners were female,bringing our total female participation to 37%. In addition,at the end of 2020, we confirmed that the members of
the Executive Committee post the completion of theacquisition of Refinitiv would be 40% female.

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Welcome to our 2020 Group Sustainability Report continued
OUR FOCUS IN 2020

Our response to Covid-19
Page 4£75 billionof Covid-19 bonds were listed
on London Stock Exchange

Diversity and Inclusion
Page 29–30

44%
Female representation at Board level
as of 31 December 2020

We have also made good progress in promoting ethnicallydiverse talent within our organisation. We have madepublic commitments on race and disability equality
through the Race at Work Charter and grown our Inclusion
Networks. There is clearly much more to do but LSEG isfully committed to that effort and it will remain a key
priority for the Group moving forward.
Climate risks pose threats to ecosystems, societies,
markets and to companies. LSEG is committed to playing
a leading role in supporting the growing drive to a net-zerocarbon economy. LSEG has been a supporter of the Task
Force for Climate-related Financial Disclosures (TCFD)
since its launch in 2017. LSEG not only encourages issuers
to report against TCFD through our reporting guidance
but aims to go further each year in embedding thesestandards into our own financial reporting. In July, I joinedMark Carney, UN special envoy for climate and finance,
to launch an initiative to ask exchanges from aroundthe world to join a collaborative effort to drive globallyconsistent climate reporting. This collaboration is being
taken forward through the United Nations Sustainable
Stock Exchanges advisory group which LSEG chairs,
alongside the Johannesburg Stock Exchange. We aredeveloping reporting guidance based on TCFD to ensure
globally consistent disclosures which each exchange
can publish for use by their own corporate issuers.
With regards to carbon emissions associated with LSEG’s
own operations, given the pandemic, the reduction inbusiness travel and increased remote working haveresulted in a significant reduction in our CO2 emissions
per employee. In February 2021, LSEG also confirmedthat it had become a signatory to the Business Ambition
for 1.5ºC, and a member of the United Nations Climate
Change “Race to Zero”. The Group’s ambitious,
science-based targets to reduce emissions in alignment
with the Paris Agreement have also been approvedby the Science Based Targets initiative (SBTi).

And finally, as a product provider and a partner tobusinesses, investors and the finance sector, we
continued to roll out a series of new products across
our core businesses to further enable the integrationof sustainability into markets. This included the FTSE
Climate Risk-Adjusted EMU Government Bond Index(Climate EGBI), a European variant of the Climate WGBI,
applying factors based on physical risk, transition risk
and resiliency. Later in 2020, we brought out a newversion with increased tilting towards climate risk
considerations, the FTSE Advanced Climate EGBI,
which was used as a basis for the first climate riskadjusted government bond ETF in the market launchedby BlackRock. Further products launched include theGreen Revenues 2.0 model, a revised taxonomy toassess reliably corporate contributions to the green
economy. In our capital markets business, we werenamed “Stock Exchange of the Year” by Environmental
Finance in their 2020 Sustainable Investment Awards.
In 2020 London Stock Exchange recognised a further
21 issuers with its Green Economy Mark, for companies
that can attribute 50% or more of their revenues fromgreen products and services, bringing the total
number of companies with this classification to 92.
The acquisition of Refinitiv, which we completed in
January 2021, will significantly enhance our ability tofurther drive sustainable growth through innovation insustainability analytics. Furthermore, their commitment
to sustainability leadership and the United Nations
Sustainable Development Goals is aligned with LSEG’spriorities. The combination provides an opportunity tocreate a world-leader in sustainability that can partner
across capital markets to address the major challenges
that the global economy and our societies face.
We look forward to presenting a new and enhanced
sustainability agenda in the coming months.

The acquisition of Refinitiv
will significantly enhance
our ability to further drive
sustainable growththrough innovation insustainability analytics.”

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Our response to Covid-19
Across our business

Covid-19 has had a huge impact onsocieties, the global economy, our own
people, customers and stakeholders.
The health and wellbeing of employees
has been a key focus. The vast majorityof our teams in most locations have beenworking remotely and we continue
adapting our technology and working
practices to this changing environment.
LSEG is in regular contact with publichealth authorities, governments andstakeholders around the world and will
adjust the response accordingly.
To support our people we developed a Covid-19
microsite on measures that the Group were taking tosupport them. We launched a series of video updates
from our senior leaders and produced the first editionof LSEG’s Covid-19 Support Guide, bringing together
all related resources and making it easier to accessinformation on wellbeing, learning and development
and to stay connected across the Group.
In May, we surveyed our teams globally to understandtheir experiences and plan meaningful actions.
Overall feedback was positive and in line withexternal trends:• 92% were confident in senior leaders’ ability to lead
the Group during this time
• 86% believed their manager is effectively managing
them and their team virtually, with 83% agreeing their
manager regularly asks how they are doing• 93% understood their team’s key priorities and 94%
were clear about what is expected of them

• 82% responded that they knew who to talk to for support
to manage their wellbeing• 91% responded they were able to stay connectedwith colleagues.
The survey included open-ended questions which invited
colleagues to highlight what (if any) further support theyrequire while working remotely. Half confirmed they
were satisfied with current arrangements, while others
highlighted a need to improve: communication,technology and manager capability.
In response to the survey insights, we launched a seriesof line manager webinars focused on topics such asbuilding resilience and how to keep a remote teamconnected, helping our leaders manage wellbeing
within their teams and ensuring colleagues felt
connected. We empowered our leaders to encourage
new ways of working, through running townhalls andvirtual team meetings. These meetings are run alongsideregular intranet articles and events focusing on different
aspects of wellbeing, such as the “Managing Home andWork Life” webinar. We have have encouraged
colleagues to assess their working environments andtargeted learning is available to support our managers as
they learn to adapt to new ways of working andmanaging teams.
We launched a series of mental health awareness eventsand trained more than 340 colleagues as Mental HealthChampions, who are now able to spot when someone
may be struggling with their mental health while working
remotely, and can identify support pathways for colleagues.
We introduced the LSEG Social Exchange, wherecolleagues are paired up for a virtual coffee break withpeople they might not ordinarily interact with, building
relationships across the Group and fostering an environmentof collaboration. Over 350 colleagues took part in thefirst cohort with the next group starting in early 2021.

Parts of the Group have been running an initiative called“Mid-week My Time” where on Wednesday afternoons
there is a “no meeting zone”, colleagues can use this time
for their own development or wellbeing. Refinitiv alreadyhave something similar in place as a wellbeing initiative.
To measure these initiatives effectiveness, we surveyed
colleagues again in September. While results remainedin line with external trends, some results were lower,reflecting colleagues’ need for greater human and social
interaction, having worked remotely for a prolonged
period. For example, 55% of our colleagues felt able todisconnect from work during non-work time (vs. 75% inMay). To help them create clear boundaries, we launcheda series of Wellbeing webinars focusing on how to
improve motivation, stay connected and keep positive
through uncertainty. The latest results showed that 73%
know who to talk to if they need support to manage theirwellbeing (vs. 81% in May).
We recognise that we continue to operate in a challenging
environment, and for some colleagues this can takea toll on their wellbeing. We are encouraging colleagues
to speak with their line managers to arrange flexible
working solutions to suit them. We’ve provided regularcommunications through various channels and internal
support networks to ensure all colleagues understandwhat resources are available to them to manage theirwellbeing, and who they can talk to if they need support.
Across our markets
In March, London Stock Exchange was the first exchange
globally to announce that it would be admitting socialand sustainability bonds with the use of proceedsaligned towards mitigating the impact of Covid-19 with noadmission fees on its Sustainable Bond Market (SBM).
As of 31 December, a total of £75 billion of Covid-19
bonds were listed on London Stock Exchange, of which
over £4 billion was listed on the SBM. These issuances

included a US$3 billion Social ‘Fight Covid-19’ bondby the African Development Bank Group. The proceeds
will be put towards mitigating the impact of Covid-19.
Additionally, RepoClear supported the clearing ofbonds issued as part of the European Union’s
temporary support to mitigate unemployment risks inan emergency programme.
LSEG is committed to supporting communities where
it operates around the world. In response to Covid-19,
our regional charity committees made recommendations
to LSEG Foundation on suitable donations, which has
allocated more than £420,000 to charities across theworld. Colleagues have raised additional funds tofurther support specific charities. We are matching
employee donations for Covid-19-related relief up to£120,000 globally.
In the UK, we donated £1 million to Business in theCommunity’s National Business Response Network,
set up by The Prince’s Trust. The Network matches
community groups, charities and small businesses
in need with other businesses that can provide
support to them.
In Italy, we donated €1 million to Fondo di Mutuo
Soccorso (Mutual Aid Fund), established to help
individuals and support the recovery of the economy
with focus on small businesses and the sectors mostimpacted by Covid-19.
Globally, LSEG donated £1 million to the International
Committee of the Red Cross (ICRC)’s Emergency
Appeal for Covid-19 to fund emergency medical
aid around the world.
For more information on how we mitigated thepeople-related risks that came with Covid-19,
please see page 38 of our Annual Report.

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London Stock Exchange Group plc
Group Sustainability Report 2020

Our
Sustainability
Strategy

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Appendix

We are a global business and a key partof the world’s financial system. As such,
we play an important role in contributing
to economic stability and sustainable growth.
It is a role that we perform with pride andwe take our responsibilities very seriously.”David Schwimmer
CEO

01

Being a responsible business6

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Group at a glance
Who we are

OUR GROUPLSEG (London Stock Exchange Group) is more than adiversified global financial markets infrastructure and databusiness. We are dedicated, open-access partners witha commitment to excellence in delivering the services
our customers expect from us. With extensive experience,
deep knowledge and worldwide presence acrossfinancial markets, we enable businesses and economies
around the world to fund innovation, manage risk andcreate jobs. It’s how we’ve contributed to supporting
the financial stability and growth of communities
and economies globally for more than 300 years.

Data and Analytics
Our acquisition of Refinitiv ensures we can provide thebreadth and depth of financial data and best-in-classanalytics that customers expect – driving innovationand growth across global markets. And our highperformance solutions – from trading, to market
surveillance, to wealth solutions and more – enhance
the performance of our customers and the markets

Our purpose

Driving financial stability, empowering economies
and enabling customers to create sustainable growth.

The rest of this page describes our Group as of 29
January 2021, following the completion of the Refinitiv
transaction. This report describes the sustainability
performance of LSEG as a standalone business in
2020. We look forward to sharing more about our new
Group sustainability strategy going forward.

For more information on our business model,
see page 8 of the Annual Report

FTSE Russell is a global leader in financial indexing,
benchmarking and analytic services with more than
$16 trillion benchmarked to our indices – and offers
an extensive range of data services and research.
The combination of Refinitiv and FTSE Russell
provides LSEG with world-leading capabilities in data,
analytics and indices.
Capital Markets
We offer our customers extensive access to Europe’s
capital markets and liquidity across multiple asset
classes. We operate a broad range of international
equity, fixed income, related exchange-traded funds(ETFs)/exchange-traded products (ETPs) and foreignexchange markets that enable customers, communities
and economies to grow. Our Group is home to several
capital formation and execution venues: London Stock
Exchange, AIM, Turquoise, CurveGlobal, Refinitiv FXall
and Tradeweb (through a majority ownership interest).

Post Trade
We support our customers’ clearing and reporting
obligations, providing risk, balance sheet and financial
resource management solutions, while working with ourother divisions to extend this support across the value chain.
A leading global clearing house with a strong presence
across multiple asset classes, LCH helps financial
institutions all over the world use their capital efficiently
and mitigate counterparty risk across multiple asset
classes for sell-side clearing members and buy-sideclients in conjunction with trading venues globally.
UnaVista, a regulated platform that helps customers
meet their reporting compliance obligations andreduce operational and regulatory risk throughreporting, reference data and analytics solutions,further complements our Post Trade offering.
Through a comprehensive, integrated suite of trusted
financial market infrastructure services – and ouropen-access model – we provide the flexibility, stability
and trust that enables our customers to pursue theirambitions with confidence and clarity
Group Sustainability
Integrity and trust are at the core of what we do. As aGroup we have, from the outset, operated under thebanner of “my word is my bond”. That overriding principle
is still relevant today as a provider of trusted, reliable,
independent and user neutral services. Positioned at
the heart of capital markets, we are well placed to drive
long-term sustainable economic growth, stability andresilience across global economies. We partner acrossthe marketplace, and with other industry leaders, tochampion the role responsible businesses and investors
play in accelerating the transition to a net-zero,sustainable economy.

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Looking ahead
As our business expands and diversifies,
we continue to review our sustainability
objectives. Following completion of the
Refinitiv transaction in January 2021, on
this page we begin to set out our ambitions
for the new Group. We look forward to
sharing more on this during 2021.

Commitment

Actions

1. TRANSFORMING
THE GLOBAL FINANCIAL ECOSYSTEM• Integrate and invest in ambitious Group sustainable investment and finance strategies aimed at transforming
the global financial ecosystem.
• Build market-wide momentum in the run-up to COP26 as a leading global financial markets infrastructure group
working with issuers, investors and policy makers to drive actions towards a low-carbon and sustainable economy.
• Drive and support efforts towards catalysing consistent sustainability and climate disclosure globally.
• Deepen our work on social and inclusion performance metrics, and help strength financial controls in building war
crimes and green crime into financial risk screening tools• Take our focus on sustainable and climate transition finance to the next level through the development of innovative
market initiatives and collaborations.
• Build upon and extend our network of partners to develop the next generation of sustainable finance and investment
platforms including through Future of Sustainable Data Alliance and the UN Sustainable Stock Exchange Initiative.
• Explore strategies for integrating Sustainable Finance considerations into our Post Trade operations.

2. TRANSFORMINGOUR OPERATIONS AND CULTURE
WHILE SUPPORTING THE
WIDER COMMUNITY• Build out our internal sustainability capabilities and the associated resourcing to support the deepening integrationof sustainability across LSEG.
• Further develop quantified metrics including the enlarged Group’s Science-based Targets to set out a decarbonisation
trajectory with a 2030 time horizon aligned with a 1.5°C scenario.
• Engage our suppliers in our decarbonisation efforts with a view to encouraging them to establish their own
decarbonisation targets by 2025.
• Align LSEG Foundation and Refinitiv Charities under a common mission with the new Group’s purpose statement,
to enable strategic community investment partnerships and mobilise our staff volunteering potential.
• Roll out enlarged Group’s culture and values supported by a people strategy that prioritises wellbeing anddevelopment with a view to retaining and growing talent at a time of significant corporate change.
• Support the markets to integrate ESG considerations and target both impact and return through back-testing historicalaspects of ESG and financial performance.

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Our approach to sustainability
WHY SUSTAINABILITY MATTERS
We are a global business and a key part of the world’s
financial system. As such, we play an important rolein contributing to economic stability and sustainablegrowth. It is a role that we perform with pride and we takeour responsibilities very seriously. Here’s how we deliver.

Our purpose

Driving financial stability, empowering
economies and enabling customers
to create sustainable growth.

Focus areas
Our sustainability activities
can be broadly aligned to
one of two key focus areas

Enabling and supporting positive change
LSEG is well positioned to support and facilitate sustainable
and low-carbon solutions across the financial markets
ecosystem by providing access to capital and supporting
integration of sustainability into investment processes.

Positioned at the heart of capital markets, we are wellplaced to drive long-term sustainable economic growthacross global economies.
We partner across the marketplace, and with otherindustry leaders, to champion the role responsible
businesses and investors play in accelerating thetransition to a low-carbon, sustainable economy.
This goes beyond creating sustainable products
and being a responsible business ourselves. It’s about
embedding sustainability as a fundamental part of ourstrategy and culture.

We aim to do this through our Convene, Grow, Disclose
and Transition impact areas, explained below.
They represent where we can have the biggest impact as abusiness, using our unique position at the centre of capital
markets to make a meaningful difference.

Our intent is also to support and encourage our people
to volunteer, to play active roles in the communities inwhich we work and to work together on action on theenvironment and climate change.

Impact areas
We have six impact
areas that direct our
focus on all of oursustainability activities.

Information on our sustainability risk
management can be found on page 36 and 50

ConveneLeveraging ourposition at thecentre of capital
markets to drive
global growth

Grow
Small andmedium-sizedenterprises(SMEs) raise
capital and fundinvestments
to create
employment
worldwide

Disclose
Providinginvestors withinformation andtools to assess
the ESGperformanceof companies
to facilitate
engagement
and investment
approaches

Transition
We work withissuers andinvestors
to provide
solutions that
accelerate andmanage thetransition to a
low-carbon
andsustainableeconomyBeing a responsible business
LSEG fully recognises its responsibilities to its people
and their importance to our business model.
We monitor our impact on the communities around us
and how it aligns with our strategy and values. We aim
to promote sustainable practices and support local
communities and the environment where we havea significant business presence.

Develop
Employ andinvest in thedevelopmentof a highly
diverse global
workforce todeliver on oursustainablevisionSustain
We will help theless advantaged
in communities
worldwide
to develop
business skills
and to support
the environment

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Materiality review
Prior to reporting, all initiatives and activities from acrossthe year are assessed for their materiality within our
strategic framework. Items are cross-referenced using
both internal and external evaluators; internally, initiatives
are evaluated on their relevance to six impact areas andexternally against the UN Sustainable Development
Goals (SDGs) and Global Reporting Initiative (GRI)
materiality definitions. If the item is deemed to be material
against this framework, it is reported.
Together, this framework provides a tool to:• set coherent and congruent objectives withcross-Group impact• create aligned action plans• engage with employees to add value throughinnovative strategies• engage effectively with external audiences
and stakeholder groups
Sustainable Development Goals
We assess initiatives and activities for their contribution
towards fulfilling five SDGs that are relevant to stock
exchanges as set out by the UN Sustainable Stock
Exchanges initiative (UN SSE): gender equality, decent
work and economic growth, responsible consumption andproduction, climate action and partnerships for the goals.
More information on SDGs can be found here:
www.sdgs.un.org/goals
This framework, incorporating the SDGs in corporate
reporting, is recommended in our ESG Reporting Guidance

Details on the specific targets within each
SDG that we look at can be found on page 55

Impact areas
The six impact areas
and their materiality are:Sustainable
Development Goals
Relating to the six
impact areas

ConveneLeveraging ourposition at the centreof capital markets todrive global growth

Grow
Small and mediumsized enterprises(SMEs) raise capitaland fund investments
to create employment
worldwide

Disclose
Providing investors
with informationand tools to assess
the ESG performanceof companies
to facilitate
engagement
and investment
approaches

Transition
We work with issuers
and investors toprovide solutions
that accelerate
and manage thetransition to a
low-carbon andsustainableeconomyDevelop
Employ and invest
in the developmentof a highly diverse
global workforce
to deliver on oursustainable vision

Sustain
We will help theless advantaged
in communities
worldwide to
develop businessskills and to support
the environment

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Progress on our commitments
Key:
Achieved
In Progress

In the past year, we have continued to make progress towards the commitments
made in our 2019 Group Sustainability Report.
Focus areas

Objective

Actions

Grow

Build on the success of the Companies to Inspire series, ELITE
and AIM to promote access to capital of SMEs

• 25th anniversary of AIM, see page 14 for progress in 2020
• 7th edition of 1000 Companies to Inspire Britain report published• See page 14 for details on ELITE

ConveneSupport climate finance action for COP26, co-hosted by the UK and
Italy, to convene the finance industry across both markets to mobilise
capital markets in support of action to enable climate transition• While COP26 was delayed due to the Covid-19 pandemic, we led a numberof major climate action focused initiatives, events and product launches through2020. We continue to drive momentum ahead of the postponed COP26 which
now takes place in November 2021

Disclose

Develop new tools to promote better ESG disclosures on LSEG
markets and beyond, and promote disclosure through benchmarks• London Stock Exchange’s ESG Disclosure Score helps issuers to see where
they might improve their most important sector-specific ESG metrics andunderstand how they fare in comparison to their peers. It is a tool for issuers
to consider good practice in disclosure of key quantitative ESG metrics

Transition

Build on LSEG purpose statement to develop a long-term integrated
sustainable finance strategy, including developing capabilities to support
investors and issuers focus on the transition to a low-carbon economy• Details on our strategy can be found on page 13. We continue to develop
this and there are opportunities to develop a more comprehensive
sustainable finance strategy within the new company

Develop

Further align HR systems and programmes, including diversity andwellbeing, to the Board’s culture approach, ensuring resilience during
periods of change• Full details of this can be found on pages 26–32

Sustain

Increase alignment of LSEG community investment programme to
LSEG Foundation’s mission and strategy, aiming for a 95% target• Full details of this can be found on pages 33–34• While we did not meet our volunteering target in 2020 we acknowledge thatthe impact of the Covid-19 pandemic played a part in this and we have worked
to provide additional support to our people and communities during this time.
Please see page 4 for more detail• Details of our environmental progress can be found on pages 22–25

Achieve the 25% target for LSEG colleague’s involvement involunteering activities
Work towards the approval of our science-based target by the
Science-based Targets initiative during 2020 and aim for a further
2% reduction in Scope 1 and 2 emissions per FTE/£m revenue anda 2% reduction in waste per FTE compared to 2019, while assessing
using Gold standard carbon credits to offset unavoidable air travelemissions, alongside other initiatives that will reduce our impact ofour business travel

SDGs supported

Progress

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Sustainability ratings performance
It is becoming a norm that investors consider aspects of the ESG performance of an issuer alongside other financial and strategic information in an integrated manner within
their investment strategies. Given our mix of businesses supporting both issuer companies and investors, we are keen to promote high standards and disclose data that is reliable,consistent and comparable across industries.
Our ESG practices are measured by a variety of assessments including performance indices and benchmarks. These assessments provide useful external input to benchmark against global best practices and to plan for improvements
in our sustainability approach.
ESG rating provider

Assessment

CDP
CDP, formerly known as the Carbon Disclosure Project, runs a global disclosuresystem that enables companies, cities, states and regions to measure andmanage their environmental impacts.

Overall score

MSCI
An MSCI ESG Rating is designed to measure a company’s resilience to long-term,industry material environmental, social and governance (ESG) risks. Ratings range
from leader (AAA, AA), average (A, BBB, BB) to laggard (B, CCC).

Overall score

Sustainalytics
Sustainalytics ESG Risk Ratings measure the degree to which a company’s
economic value is at risk driven by ESG factors or the magnitude of a company’s
unmanaged ESG risks.

Risk Rating(out of 100, where 0 is best)
Ranking (Diversified Financials)

FTSE Russell
FTSE Russell’s ESG Ratings and data model allows investors to understand acompany’s exposure to, and management of, ESG issues in multiple dimensions.
The ESG Ratings are comprised of an overall Rating that breaks down into
underlying Pillar and Theme Exposures and Scores. The Pillars and Themes
are built on over 300 individual indicator assessments that are applied to eachcompany’s unique circumstances.
Dow Jones/SAM Corporate Sustainability Assessment
The SAM Corporate Sustainability Assessment (CSA) is an annual evaluation ofcompanies’ sustainability practices. Each year over 7,300 companies around theworld are assessed. The CSA focuses on criteria that are both industry-specificand financially material and has been doing so since 1999.

Absolute score (5-highest)
Supersector relative percentile
score (100 – highest)
Environmental score (5-highest)
Social score (5-highest)
Governance score (5-highest)
Total sustainability company
score (Out of 100)Governance & Economic
score (Out of 100)
Environmental score (Out of 100)Social score (Out of 100)

2020
A-

AA

2019

2018

A-

A-

AA

A

16.9

18.2

N/A

Low Risk
62nd
out of 681
4.6
97

Low Risk

N/A

4.6
96

4.6
98

5.0
4.3
4.6
61 (89th)

5.0
4.3
4.6
61 (86th)

5.0
4.3
4.7
59 (83rd)

61 (91st)

63 (89th)

59 (83rd)

th

th

rd

85 (95 )
51 (87th)

76 (88 )
53 (82th)

65 (83 )
55 (85th)

Commentary
London Stock Exchange Group received a A- which is in the Leadership band.
This is significantly higher than the Europe regional average of C, and higher
again than the specialised professional services sector average of D.
LSEG has set long-term, ambitious targets; and signed up to
SBTi (Science Based Targets initiative) to ensure our corporate
targets are aligned with a 2050 Net Zero pathway.
According to MSCI, LSEG remains a top performer in its peer group due to its
strong corporate governance and comprehensive ethics policies. One area
MSCI highlights is whether LSEG’s acquisitions may weigh on employee
retention. Please see page 31 for further information, see the Social section
where we cover how we support and develop our diverse talent of our people,
and our culture.
MSCI also recognises that LSEG has implemented a number of initiatives
to reduce the energy consumption of its activities and outperforms peers
in its efforts to understand environmental trends and integrate related
considerations into its products and services.
Sustainalytics finds that LSEG is at low risk of experiencing material financial impacts
from ESG factors, due to its low exposure and management of material ESG
issues. LSEG is in the lowest risk decile within Diversified Financials. Sustainalytics
particularly identified LSEG for its strong corporate governance performance.
LSEG scored highly across ESG and is a strong performer in its peer group.
The FTSE Russell assessment is very high with LSEG identified in the top 3%
in its supersector. However, there still may be some opportunities to improve
the assessments further in some social and governance themes including
on tax transparency.
The assessment finds LSEG remaining a top performer in its peer group due
to its strong corporate governance and comprehensive ethics policies.
LSEG has performed consistently across all of the indicators, in particularly
environmental ranking. However, specific methodology details and analysis havenot been made available to LSEG.

12

London Stock Exchange Group plc
Group Sustainability Report 2020

Enabling andsupporting
positivechangeIntroduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Positioned at the heart of capital markets,
we are well placed to drive long-term sustainableeconomic growth across global economies.
We partner across the marketplace, and with otherindustry leaders, to champion the role responsible
businesses and investors play in accelerating thetransition to a low-carbon, sustainable economy.”
Murray RoosGroup Director of Capital Markets

Appendix

LSEG is well positioned to support andfacilitate sustainable and low-carbon
solutions across the financial markets
ecosystem by providing access tocapital and supporting integration ofsustainability into investment processes.
We aim to do this through our Convene,
Grow, Disclose and Transition impact areas.
This represent where we can have thebiggest impact as a business, using ourunique position at the centre of capital
markets to make a meaningful difference.
Impact areas:
Convene | Grow | Disclose | Transition
Sustainable Development Goals:

02

13

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixAchievements in 2020
London Stock Exchange has been named“Stock Exchange of the Year” in Environmental
Finance’s 2020 Sustainable Investment
Awards. The publication highlighted that
London Stock Exchange impressed judges
by both the breadth and depth of its
sustainable investment innovation,
including the launch of its Green Economy
Mark and Sustainable Bond Market.

London Stock Exchange’s sustainable financeprogramme drew on the unique strengths of London
Stock Exchange Group and demonstrated sector-wide
leadership in supporting ESG and sustainable
investment, with a comprehensive, cross-asset-classprogramme, which:• Delivered new market innovations that have alreadyhelped raise significant additional capital;• Provided comprehensive tools to support companies,
funds and investors; and• Brought together market actors to share best practice.

01

Our strategy is based on the belief that sustainable
investment must be integrated into the mainstream,
supported by the world’s largest capital markets. The
2020 sustainable finance programme is built upon theexpertise of the whole London Stock Exchange Group,particularly the deep ESG data and investor insights of
FTSE Russell and Beyond Ratings with three focus areas:

03

Driving best practice in disclosure
Helping all equity, fund and fixed income issuers tounderstand and implement effective, decision-useful
ESG disclosures that reflect investor needs andtrends in regulation.

02
Supporting new green-growth companies and funds
Improving the visibility of, and access to capital for,green and sustainable businesses worldwide.

Enabling the transition to a sustainable,
low-carbon economy
Innovating to enable companies across all sectors toaccess the capital needed to address environmental
risks and opportunities.

CONTENTS
Green and sustainable financing
Covid-19 bonds
ELITE
AIM
Green Economy Mark
Sustainable Bond Market
Green Funds
ESG ETFs
1000 companies to inspire

Market Partnership
ESG disclosure score report
Borsa Italiana sustainability week
Taskforce on Scaling Voluntary Carbon Markets
TCFD guidance

Sustainable investment decision-making
FTSE Russell green revenues data model 2.0
FTSE4GoodTPI index
FTSE target exposure indexes
Climate EGBI
Smart sustainability survey

14

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixAchievements in 2020 continued
COVID-19 BONDS

US$3 billion‘Fight Covid-19’ bond by the African
Development Bank Group

ELITE
Grow

AIM
Grow

Shaded achievements are our key highlights for the year

As at 31 December, a total of £75 billion of Covid-19
bonds were listed on London Stock Exchange, of which
over £4 billion was listed on the SBM. These issuances
included a US$3 billion Social ‘Fight Covid-19’ bond by
the African Development Bank Group; this was also theissuer’s first listing on London Stock Exchange. The
proceeds will be utilised towards enhancing access toessential services, supporting healthcare, employment,water and sanitation to mitigate the impact of the pandemic.
There were also two Covid-19 social response bonds
listed on Borsa Italiana, raising €1 billion.

£75 billion

ELITE, LSEG’s international programme to facilitate
access to capital for SMEs, saw its community reach
1,500 companies across 45 countries (2019: 1,400
companies across 45 countries).

ELITE continues to expand reach in Europe by leveraging
on ELITE Ambassadors local presence, country-specificknowledge and networks to better cater for the needsof ambitious private companies. Seven ELITE companies
joined our markets, taking the total number of IPOs from
ELITE companies on our markets to 36.

1,500

AIM continues to be one of the world’s most successful
growth markets, supporting companies throughoutchanging business and economic cycles. London Stock
Exchange celebrated the 25th anniversaryof the launch of AIM in June. Since its inception in June
1995, AIM has admitted over 3,800 companies from acrossthe globe, raising a combined £118 billion in equity capital.

25th

In March 2020, London Stock Exchange was the firstexchange globally to announce that it would be admittingsocial and sustainability bonds with use of proceedsaligned towards mitigating the impact of Covid-19 withno admission fees on its Sustainable Bond Market (SBM).
This move was widely welcomed by the market, andhas since been replicated by other exchanges.
We strongly believe that social and sustainability bonds
with use of proceeds aligned to funding essential
services such as healthcare, water and sanitation,
supporting employment, or with a link to the relevant
UN Sustainable Development Goals can have a role toplay in directing capital to initiatives that will help mitigate
the impact of Covid-19. Such instruments could help
issuers in both developed and developing countries
unlock funding for a wide range of critical projects inboth the short and long term.

of Covid-19 bonds were listed
on London Stock Exchange

companies in ELITE network

anniversary of the launch of AIM

15

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixAchievements in 2020 continued
GREEN ECONOMYMARK 2ND COHORTAND REPORTGrow | Transition

The Green Economy Mark, which was launched in
October 2019, recognises equity issuers on London
Stock Exchange Main Market and AIM with green
revenues of 50% or more, identified by the Green
Revenues data model developed by FTSE Russell.
21 new issuers were awarded the Green Economy Mark,bringing the total to 92 issuers by the end of 2020, with a
combined market capitalisation in excess of £135 billion,
including Chinese GDR issuer Yangtze Power, becoming
the first Shanghai-London Stock Connect issuer to beawarded the Mark.

A report published in July 2020 showed that Green
Economy Mark issuers account for 2% of total market
capitalisation and 4% of total number of equity issuers,
yet were responsible for 8% of total capital raised in theprevious 24 months. Further, collectively issuers with theGreen Economy Mark outperformed the FTSE All-Share
Index over the past two years by 37%. While the markets
experienced significant volatility during the Covid-19
pandemic, Green Economy Mark equities, in aggregate,
demonstrated greater resilience and subsequently
recovered faster than the rest of the market.

£135 billion

In 2020, a total of 43 bonds raising £13.5 billion by
22 issuers have been listed on the Sustainable Bond
Market. 11 of these issuers were debut issuers on ourmarkets, including the United Mexican States, Qatar
National Bank and Northern Powergrid. As of end of
December there are 253 active bonds on the SBM
raising a combined £52.4 billion.

On Borsa Italiana’s Green and Social Bond segment,
59 new green or sustainable bonds were listed in 2020,
with a total of 161 instruments on the segment at the endof the year. This includes two Covid-19 social responsebonds listed on Borsa Italiana, issued by Cassa Depositi
e Prestiti, raising €1 billion. Moreover, on ExtraMOT PRO3,
the fixed income segment of Italian SMEs, 23 new debt
instruments have been listed, with 180 debt instruments
listed and €5.5 billion raised since the launch.

combined market capitalisationof Green Economy Mark issuers

92Green Economy Mark issuers

SUSTAINABLE BOND MARKETAND GREEN BONDS
Grow | Transition

London Stock Exchange’s Sustainable Bond Market (SBM)
acts as a platform for sustainable finance instruments andcomprises dedicated segments for social and sustainability
bonds. We remain committed to supporting our clientsand the development of the social and sustainability
bond markets during this unprecedented period.
In 2020, London Stock Exchange launched its
Sustainable Bond Market Advisory Group (SBMAG), a
forum for market participants to provide input on London
Stock Exchange’s Sustainable Bond Market and act as aconsultative body on future developments in the sustainable
field. This initiative is part of London Stock Exchange’s
continued commitment to support companies andinvestors seeking to raise capital and manage risk
associated with the transition to a low-carbon economy.

Shaded achievements are our key highlights for the year

One of the key developments in sustainable financein 2020 has been the emergence of transition bonds,
where either the issuer itself or the issuer’s activities
are transitioning to more sustainable operating models.
We have participated in industry initiatives on the designof suitable market disclosure standards including the
Climate Transition Finance Working Group, under ICMA’s
Green Bond Principles/Social Bond Principles. In 2021,
we expect to launch London Stock Exchange’s Transition
Bond segment as part of SBM.

16

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixAchievements in 2020 continued
GREEN FUNDS
Grow | Transition

ESG ETFS
Grow | Transition

Green funds listed in London raised £2.3 billion in 2019,representing over one third of all capital raised by listed
funds in London. Key listings in 2020 included funds forsocial causes, such as Home REIT, which became thelargest UK focused REIT to list in London for over three
years and the largest fund IPO in 2020, by raising £241
million to invest in property that seeks to alleviate
homelessness in the UK. We also saw listings that aim
to facilitate the transition to a low-carbon economy
including Triple Point Energy Efficiency Infrastructure

Company, which was the 25th fund to receive the Green
Economy Mark, as it raised £100 million, to invest in energy
efficiency assets. Listed green funds represented over
35% of the further capital raised for funds in 2020,
including Greencoat UK Wind raising £400 million –the largest issuance ever for a listed green fund in London,
highlighting the strength of investor demand forrenewable energy and energy efficiency assets andunderlining LSEG’s position as a leading international
centre for promoting and raising green finance.

2020 saw a record breaking 132 ESG and sustainable
ETFs listed on our markets, bringing the total to 326
as of 31 December 2020.

The 61 new ESG ETF listings on our London markets
represent 45% of new ETF listings in 2020 on London
Stock Exchange. This compares to 18% in 2019,
demonstrating the continued growth in support
for these products.

At year end there were 138 ESG and sustainable ETFs
listed on London Stock Exchange with almost £100 billion
AUM at year end.

1000 COMPANIESTO INSPIRE
Grow

London Stock Exchange Group published the seventh
edition of its ‘1000 Companies to Inspire Britain’ report,
which identifies the UK’s most dynamic and fastestgrowing small and medium-sized enterprises (SMEs). The
businesses featured in this year’s report highlight theregional and sector diversity of UK SMEs and theinnovation shown by these companies.

The companies featured in this year’s report haverecorded an annual average revenue growth rateof 41.2% and have generated more than 42,000 jobs inthe two years to December 2019. Issuer Services hosted
and developed the functionality for those 1,000 companies
to log-in and personalise their own company pages,
allowing those companies to benefit from London Stock
Exchange’s digital reach via the Issuer Services platform.

Listed green funds represented
over 35% of the further capitalraised for funds in 2020, including
Greencoat UK Wind raising£400 million.”132
ESG and sustainable ETFs listed
on our markets in 2020

The businesses featured in thisyear’s report highlight the regionaland sector diversity of UK SMEs
and the innovation shown by
these companies.”

17

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixAchievements in 2020 continued
ESG DISCLOSURESCORE REPORT
Disclose | Convene

BORSA ITALIANA VIRTUALSUSTAINABILITY WEEK AND
CAPITAL MARKETS SUSTAINABLE
FINANCE PARTNERSHIP

London Stock Exchange’s ESG Disclosure Score helps
issuers to see where they might improve their mostimportant sector-specific ESG metrics and understandhow they fare in comparison to their peers. It is a tool for
issuers to consider good practice in disclosure of key
quantitative ESG metrics, by providing an indication of
the most relevant ESG metrics in the issuer’s industry
and showing how their quantitative disclosure acrossthese areas compares to industry peers.

The score supports issuers to focus on their ESG
disclosure, particularly the many issuers outside
the FTSE 100, who are aware but may have fewer
resources and less expertise in ESG.

Borsa Italiana continues to support Italian listedcompanies in embracing ESG trends through educational
initiatives and engagement with investors. It organised
the first virtual Italian Sustainability Week which led to
600 meetings between companies and ESG investors.

Borsa Italiana subsequently launched the CapitalMarkets Sustainable Finance Partnership, aimed
at creating an integrated ecosystem to foster thedevelopment of Sustainable Corporate Financesolutions for the Italian market.

The Taskforce on Scaling Voluntary Carbon Markets(VCM), was launched by Mark Carney, UN Special Envoy
for Climate Action and Finance Advisor to UK Prime Minister
Boris Johnson for COP26, chaired by Bill Winters, Group
Chief Executive, Standard Chartered. As an increasing
number of companies commit to reducing emissions,and investors demand clear, credible transition plans,a well-functioning voluntary carbon market will be
critical to reaching net zero and net negative goals.

These are recommendations for the private sector
developed by both current and potential market
users, to ensure this market can deliver to the needsof its participants without compromising the integrityof decarbonisation.

The ESG Disclosure Score is calculated and provided
to issuers annually in October based upon the latest ESG
data gathered by FTSE Russell. Analysis of trends showsa positive trajectory of disclosure, but found that more

ConveneTASKFORCE ON SCALINGVOLUNTARY CARBON MARKETSConvene | Transition

LSEG has been an active participant in the Taskforce
and sub-working groups since its creation andcontributed to the recommendations published in theTaskforce’s Consultation Document, which aim to identify
the infrastructure solutions necessary to scale the VCM.

The Taskforce has found six key areas where efforts
are required to achieve a large, transparent, verifiable
and robust voluntary carbon market; these themes are
establishing core carbon principles, exchange tradedcore carbon reference contracts, infrastructure, offset
legitimacy, market integrity and demand signalling.
LSEG continues to be an active member and is currently
examining a number of potential commercial
opportunities to support the scaling up of the VCM.

work is required by issuers to improve disclosure
across all industries, and in particular for the ‘Social’component of ESG.
There was notable progress among the top-scoring
issuers. In 2020, 12 issuers scored over 90% and eightof these issuers scored 100%, compared to three in 2019.
These eight issuers have a combined market
capitalisation of more than £135 billion.

18

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixAchievements in 2020 continued
MODEL GUIDANCE ON TCFD
Disclose | Transition

FTSE RUSSELL GREEN REVENUES
2.0 DATA MODEL
Transition

London Stock Exchange Group’s CEO, David Schwimmer,and former Bank of England governor, Mark Carney,
who is now the UN Special Envoy for Climate Action
and Finance, wrote in June to the CEOs of major stock
exchanges around the world. The letter asked themto join forces via the United Nations Sustainable Stock
Exchanges (SSE) initiative to join a new collaborative
project to drive high-quality consistent climate reportingby corporate issuers globally. The project aims todevelop ‘model guidance’ on best practice climate
reporting incorporating the recommendations from the
FSB Task Force on Climate-related Financial Disclosures(TCFD). LSEG is co-chairing the workstream with
the Johannesburg Stock Exchange with the goalof publishing the guidance ahead of COP26 in 2021.

In September, FTSE Russell launched its enhanced
Green Revenues 2.0 Data Model, which measures
the green revenue exposure of more than 16,000 listedcompanies across 48 developed and emerging markets.
This represents 98.5% of the total global market valueof listed companies.

The data model can also be used for a growing numberof regulatory reporting needs, including reporting
portfolio exposure to the EU Sustainable FinanceTaxonomy. Over a decade of green revenues data
is available, dating back to 2008, enabling investors
to look at a company’s changing revenues linked
to green products and services.

FTSE Russell’s Green Revenues 2.0 Data Model
provides investors with a comprehensive classification
system covering green products and services
in 10 sectors. A green ‘tiering’ system is also applied
to determine net environmental impact based on sevenenvironmental objectives. By using three tiers to ranksources of green revenue by ‘Limited’, ‘Net Positive’and ‘Clear and Significant’, FTSE Russell’s Green
Revenues data supports a clearer understandingof investors’ ‘green exposure’.

FTSE Russell’s Green Revenues data model was
originally launched in 2015 and serves as the underlying
data to London Stock Exchange’s Green Economy Mark,
which is awarded to London listed companies with over
50% of green revenues. Launched in 2019, the Mark has
been awarded to 92 issuers across London Markets.
The data model is also used to underpin several prominent
index series including the FTSE TPI Climate Transitionindex and the FTSE Environmental Markets Index series.

LSEG has been an active
participant in the Task Forcesince its creation.”David SchwimmerCEO

FTSE Russell’s enhanced
Green Revenues 2.0 Data
Model is a powerful tool thatinvestors can use to quantify
a company’s contribution to
the green economy in a single
percentage of revenue figure.”19

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixAchievements in 2020 continued
FTSE4GOOD
Transition

In 2020 Taiwan Futures Exchange (TAIFEX) licensed theFTSE4Good TIP Taiwan ESG Index for its latest futuresoffering. The FTSE4Good TIP Taiwan ESG Index Futures
is the first product by TAIFEX linked to the index, andthe first ESG based future product launched in the
Asia-Pacific region. It is also the second futurescollaboration for FTSE Russell in Taiwan.
In January 2020 FTSE Russell, in partnership with Bolsa
Institucional de Valores (BIVA), launched the FTSE4Good
BIVA Index, the first index in Mexico with a global

FTSE TPI CLIMATE
TRANSITION INDEX
Transition

FTSE TARGETEXPOSURE INDEXES
Transition

Shaded achievements are our key highlights for the year

standard of companies that meet environmental, socialand corporate governance requirements. This index was
designed to measure the performance of companies in
Mexico that demonstrate strong sustainable practices.
To be included, companies must be part of the FTSE
BIVA index, which ensures that they meet minimum sizeand liquidity criteria as well as FTSE4Good criteria,
ensuring a minimum standard in their environmental,social and corporate governance (ESG) practices.

In early 2020, FTSE Russell launched the FTSE TPIClimate Transition Index in collaboration with theTransition Pathway Initiative and the Church of
England Pensions Board. FTSE Russell is a memberof TPI contributing data, expertise and benchmark
development. This is the first global index that enables
passive funds to capture company alignment with climatetransition. The Index combines FTSE Russell and TPI

analysis on company exposure to five climate
considerations: green revenues, fossil fuel reserves,carbon emissions, management quality and carbon
performance assessments. The Church of England
Pensions Board has allocated a £600 million mandate to
track the index, supporting the Pension Board’s objectiveof aligning its fund with the goals of the Paris Agreement.

In February FTSE Russell introduced FTSE Target Exposureindexes. The new FTSE Russell indices provide precisealignment between investment exposures and investment
objectives. They allow investors to precisely calibrate
exposure to common risk factors such as Value, Quality,
Low Volatility, Size and Momentum as well as industry
and country classifications. This same methodology is
now also being applied to sustainable investing portfolio
objectives such as achieving controlled and specificclimate exposure reductions or increases in green
industry exposure. The precise control of exposures,
including the removal of unwanted factor exposures,permits greater control over index tracking error.

The launch represents a natural evolution of FTSE
Russell’s factor framework by applying variable factor
tilts over time to account for the changing attributesof stocks. Crucially, the indices maintain the high levels oftransparency associated with the FTSE Global Factor
Index Series. This methodology was employed by a UK
based defined benefit pension fund, with LGIM serving
as the asset manager. The scheme moved its entire
equity allocation to a multi-factor strategy that could limit
draw-downs, apply specific risk parameters and control
the risks of unintended factors.

FTSE Russell is committed tosupporting growing client andinvestor demand in Taiwan,
and across Asia, for sustainable
investment solutions developed to
globally recognised ESG standards.”£600 million
allocated by the Church of England
Pensions Board

20

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixAchievements in 2020 continued
FTSE ADVANCED CLIMATE
EGBI LAUNCH AND
LICENCE TO BLACKROCK
Transition

In early 2020 FTSE Russell launched the firstgovernment bond index to adjust country weights basedon climate risk consisting solely of European Monetary
Union (EMU) countries. The FTSE Climate Risk-Adjusted
European Monetary Union (EMU) Government Bond
Index (‘Climate EGBI’) expands FTSE Russell’s rangeof climate risk-adjusted government bond indexes andfollows the launch of the ‘Climate WGBI’ in July 2019.
The Climate EGBI was developed using climate scoresfrom Beyond Ratings, London Stock Exchange Group’s
highly respected ESG analytics provider.

Building on the launch of the Climate EGBI, FTSE Russell
launched the Advanced Climate EGBI in October 2020.
It differs from the parent index by applying scores forphysical risk, transition risk and resiliency in equalmeasure. The index is designed for index users withan increased focus on climate performance of theirgovernment bond portfolios and is the result of close
collaboration with BlackRock, who then used this index
as the benchmark for the first climate risk-adjusted
government bond ETF in the market.

Both institutional and private
asset owners are increasingly
including climate objectives intheir decision-making and are
adjusting fixed income portfolios
based on climate concerns.”
Arne Staal
Group Head of Research and Product,Investment Solutions

SMART SUSTAINABILITYSURVEY
Disclose | Transition

FTSE Russell published the findings of an annual
asset owner survey, run in January and February 2020,
examining the convergence of smart beta strategy andSustainable Investment (SI): “Smart Sustainability: 2020
global survey findings from asset owners”.
In 2020, we have noted a significant increase amongasset owners worldwide interested in applying
sustainability considerations to their smart beta
strategies. The survey found that 58% of asset owners
globally anticipate applying sustainability considerations

Shaded achievements are our key highlights for the year

to smart beta strategies, up from 44% in 2019. This is also
reflected in our work with our clients, who are increasingly
looking to integrate these parameters into smart beta
indexes to underlie their portfolio strategies. Climate risk
was a key topic for asset owners in 2020: among those
who anticipate applying sustainability to their smart beta
strategy, Climate risk/Carbon tops the list of sustainability
themes at 64%, with Environmental considerations closebehind at 59%, while Governance and Social themes
are also widely considered, both at 55%.

58%
of asset owners globally anticipate applying
sustainability considerations

21

London Stock Exchange Group plc
Group Sustainability Report 2020

Being aresponsible
business

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Financial markets infrastructure must play a core role in enabling
the transition to a net-zero economy. The focus on incorporating
sustainable investment strategies has only increased during
Covid-19 and LSEG is committed to playing a leading role.
As part of our own commitment, LSEG is delighted to becomea member of United Nations Climate Change ‘Race to Zero’,
the first global exchange group to do so. Our ambitious targets
to reduce emissions and limit global temperature rise to 1.5°C,
in line with the Paris Agreement, have also been approvedby the Science Based Targets initiative.”
David Schwimmer
CEO

03

Being a responsible business

Appendix

LSEG fully recognises its responsibilities
to its people and their importance to ourbusiness model.
We monitor our impact on the communities
around us and how it aligns with ourstrategy and values. We aim to promotesustainable practices and support local
communities and the environment where
we have a significant business presence.
Impact areas:
Develop | Sustain
Sustainable Development Goals:

22

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Environment: progress in 2020
As a Group, we strive to take a leadershiprole in our approach to sustainability andenvironmental stewardship. This not only
covers how we support sustainability
integration into our business and capital
markets but also through our own
operations. The Group’s primary directenvironmental impacts arise from our data
centres, our offices that in 2020 hosted
over 5,000 employees around the world,from business travel and, indirectly, fromour supply chain. In the future, following
the coming together of Refinitiv andLSEG into a new company, our operational
footprint grows substantially. We are
exploring, understanding and modelling
the risks and opportunities for our businessarising from climate change and are taking
action to address them. The integration of
LSEG and Refinitiv provides an opportunity
to evolve and deepen our approach tosustainability and to managing ourenvironmental impacts.

Highlights

ACDP Climate Change
for 5th consecutive year

65%
reduction in absolute operationaland business travel emissions (vs. 2019)15

Between 2013 and 2020, the Group achieved over 70%
reduction in GHG emissions. We achieved this throughinvestment in energy efficiency measures: new technology,
office and data centre consolidation and purchasingof 100% renewable electricity. During 2020, ourenvironmental ambitions for the next ten years wereraised as we embark on what the United Nations havecoined the ‘Decisive Decade’. We have set a sciencebased target approved by the Science Based Targets
Initiative (SBTi), which ensures our emissions reduction
target meets with the changes needed to keep global
warming below 1.5ºC compared to pre-industrial levels.
This target will demand us to not only make substantialchange to our own operations, but also requires our
supply chain to take action.

15. Footnotes can be found on page 48

100%
renewable electricity

Approvedscience-based target

This target supports us on our trajectory towards net-zeroemissions by 2050. At the start of 2021, we stated ourcommitment to ‘Business Ambition for 1.5ºC’, and therefore
joined the ‘Race to Zero’ campaign convened by the UN
to build momentum around the shift to a decarbonised
economy, ahead of COP26. It aims to show that businesses,
cities, regions and investors are united in preparing
themselves to achieve net zero carbon emissions before
2050. As LSEG integrates with the Refinitiv business,
who themselves have set science-based targets approvedby the Science Based Targets initiative (SBTi), the targets
for both legacy businesses will be combined to provide
a new Group-wide set of targets which will be sharedin next year’s report.

Progress against our science-based target is detailed
Official science-based target
below. During 2020, as a result of the impact of Covid-19
London Stock Exchange Group plc commits toon our operations, we achieved a 65% reduction in
reduce absolute Scope 1, Scope 2 and Business
Scope 1, 2 and Business Travel (Scope 3) emissions.
Travel (Scope 3) GHG emissions 46% by 2030
This was primarily due to global travel restrictions.
from a 2019 base year.
We will report on progress against our science-basedtarget in our Sustainability and Annual Reports.
London Stock Exchange Group plc’s supplierengagement target commits to 66% of our
suppliers (by emissions) setting a science-basedtarget by 2025, covering 57% of our total
Scope 3 emissions.

23

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Environment: progress in 2020 continued
Progress against our science-based target is detailed
below. During 2020, as a result of the impact of Covid-19
on our operations, we achieved a 65% reduction in
Scope 1, 2 and Business Travel (Scope 3) emissions.
This was primarily due to global travel restrictions.
We will report on progress against our science-basedtarget in our Sustainability and Annual Reports.
2020 Actual

7,348
tCO2e

2019 (base year)

2020 Milestone

20,9554.2%2030 Target

Progress

tCO2e

46%

Less tCO2e

Less tCO2e

65%

Less tCO2e

In 2020, we undertook a full inventory of all relevant
indirect GHG emissions, covering emissions from our
supply chain, employee commuting, upstream assets,
and additional indirect fuel-and-energy-related emission
sources. Our supply chain emissions are estimatedbased on spend by procurement category, which has
allowed us to identify the number of suppliers that weneed to engage with through our supplier engagementtarget (as above). Upstream assets include leased
storage space, as our leased office and data centre
facilities are already included in our Scope 1 and 2
emissions. Emissions from this leased space are
estimated based on floor area. Employee commuting
is currently estimated using data on the averageoccupancy per month of each of our offices, andassumptions as to typical commute types and distances
applied by region. Importantly during 2020, we havealso estimated the emissions from our employees who
are now working from home because of the pandemic.
As part of our continuous work on managing ourenvironmental impact, we aim to improve the accuracyof this data during 2021.
During 2020, we rebased our GHG inventory to allow
us to make some accuracy improvements for businesstravel, as well as waste and energy emissions. This was
required as more accurate data was made available forsome offices and business travel partners, and we choseto include radiative forcing uplift to our air travelemissions calculations, as this is now common practicein corporate carbon accounting. These methodology
and data collection changes have been applied
retrospectively from 2018 to ensure continuity in ourreporting. See pages 47–48 for more information.
Our focus for the early part of 2021 will be the integrationof the legacy LSEG and Refinitiv organisations. This will
require a rebase of our GHG inventory, and generationof a new combined science-based target.

Managing our environmental impact
Our Environmental Management Group (EMG)
guides the Group’s environmental strategy, andis responsible for setting Group-wide targets,and managing and continually seeking to improve
our environmental performance. The EMG reports
performance quarterly via our Intranet and annually
discloses verified emissions on our website, in our
Sustainability and Annual Reports, and in response
to CDP, FTSE Russell, MSCI, Sustainalytics and S&P.
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
and procurement decisions, including new
developments, projects and materials• Engaging with clients, suppliers and community
partners to promote environmental best practice
We maintained our 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 extending
the system to cover further locations.
David Shalders, the Group COO, reports to theBoard on environmental operational issues andBrigitte Trafford, the Group’s Chief Communications
and Marketing Officer, reports to the Board on theGroup’s overall sustainability performance.

Appendix24

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Environment: progress in 2020 continued
OVERALL PERFORMANCE
SustainAchieved: -8% Scope 1 and Scope 2
carbon emissions per £m revenue (vs. 2019)2020 Target: -2% Scope 1 and Scope 2
emissions per £m revenue (vs. 2019)
Achieved: -9% Scope 1 and Scope 2
carbon emissions per FTE (vs. 2019)2020 Target: -2% Scope 1 and Scope 2
emissions per FTE (vs. 2019)
Achieved: -50% waste produced per FTE (vs. 2019).
2020 Target: -2% waste produced per FTE (vs. 2019).

Overall Performance
1, 5, 6, 8, 10

Total (tCO2e)
per FTEper £million revenue
Scope 12, 9
Scope 2 – Market Based3, 7
Scope 2 – Location Based3
Scope 34
Renewable Electricity 7
Scope 3 Categories6
Purchased Goods & Services
Fuel- and energy-related activities
Waste generated
Water
Business travel
Employee commutingHome working
Upstream leased assets

2020

2019

20184

137,047
23.4
56.1
2,670
0
14,279134,377100

150,983
27.8
65.3
2,734
0
18,052
148,249
100

31,492
6.1
14.8
2,271
7,132
19,16822,08966

120,194
2,663
148
22
4,671
843
5,755
81

123,2243,230
18
36
18,221
3,440
NA4
80

NA4
3,778
19
35
18,257NA4NA4NA41, 2, 3, 4, 5, 6, 7, 8, 9, 10. Footnotes can be found on page 48

It is important that we account for the GHG emissions
related to our staff working from home, for the
majority of 2020, due to the pandemic. This agile
way of working is set to continue in future years as
we adapt to increased social distancing within thework environment. For 2020, this is based onmonthly office occupancy data and estimatedenergy use in our employees’ homes by region,whilst we work on collecting more accurate datafrom our colleagues globally.
We estimate emissions resulting from our employees
working from home in 2020 totalled 5,755 tCO2e(0.98 tCO2e per FTE).

Further detail on our environmental performancecan be found on pages 42–48

Progress in 2020
Due to the impact of Covid-19 on our working
arrangements, we have achieved significant reductions
in electricity consumption, business travel journeys,
water use and waste production during 2020, resulting
in a 9% reduction in total market-based emissions
compared to 2019.
Our electricity consumption reduced by 12%, influenced
primarily by a 31% reduction in our office space electricity
use; our data centres continued to run at full capacity
throughout the year. Our fuel consumption, which isthe sole source of Scope 1 and Scope 2 market-based
emissions7 also reduced during 2020 due to lessincidents on the grid in the UK and fewer engineering
works requiring stand-by generator use.

The reductions in business travel journeys have helped
our understanding of what is possible without the ability
to travel globally, and will be an important learning that
we must use to inform our Net Zero Climate Strategy.
In response to Covid-19 and in an effort to keep our
employees safe we offered those who needed to visit
our offices the use of electric taxis across London to
avoid public transport. The use of electric vehicles in this
response has helped us to balance our environmental
concerns with the health and safety of our employees.
The estimation of further indirect emissions for our
supply chain, upstream leased assets and employee
commuting means that we are reporting all relevant
emissions sources to our organisation according to
the GHG Protocol.

25

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Environment: progress in 2020 continued
OVERALL PERFORMANCECONTINUED

What we can improve
During 2020 our absolute energy consumption reduced
for the first time since 2014, as a result of the pandemic.
If we include our assumptions on home working energyuse, we continued to use more energy to operatecompared to the previous year. This is because per
employee energy use is estimated to be higher forhome working than when in a more efficient officeenvironment. Energy efficiency initiatives were still taken
during 2020, including chiller replacement in Sri Lanka,
UPS (Uninterruptable Power Supply) replacement in
the UK and further lighting replacement projects globally,
but fewer were completed in the year than planned due
to limited access to our buildings. Natural gas reductions
were limited during low occupancy periods, whichhighlighted the need for improvements in building
management systems in some of our office locations.
These are planned for 2021.

We have identified a trend of better and more accurate
reporting of refrigerant use, which over the last two years
have become a more material impact on our Scope 1
emissions, due to the very high global warming potentialof many traditional refrigerants. During 2021, our UK teamare developing a strategy for replacing refrigerants withlower global warming potential alternatives.
This year we have expanded our carbon accounting
to include new Scope 3 categories, some of which havenecessitated the use of assumptions and estimates.

2021 focus
Our focus for 2021 will be on integration of the LSEG
and Refinitiv GHG emission inventories, environmental
governance and strategy and bringing together our
existing science-based targets. Both businesses areambitious on environmental objectives and the coming
together of the two businesses provides an opportunity
to share and learn best practice from one another.
We aim to develop an even stronger vision andexecution as combined entity. As part of the integration
activities, we have ensured environmental performanceof our estate is a key consideration in consolidating
our office and data centre locations. As we combine
our environmental reporting systems, we will prioritise
improving the accuracy of our most material emission
sources. During 2021, as travel restrictions and social
distancing measures slowly lift, it will be important that
we communicate our Net Zero Climate Strategy to all
employees and external stakeholders to ensure that
we work in a way that keeps us on track to meet ourscience-based target, and overall net zero ambition.

26

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocialDeveloping our diverse and global talent
to fulfil their potential.
In addition to activities that specifically aim
to deliver our sustainability strategy, we
also aim to ensure that our own businessactivities are consistent with good practice.

OUR CULTURE
Develop

The engagement of colleagues is central to ourorganisation. We rely on their skills and experience todeliver on the Group’s strategy and create a culture that
ensures we can attract, retain and develop the best talent.

Highlights in 2020

LSEG fully recognises its responsibilities to its people
and their importance to our business model. The LSEG
Board receives updates on matters relating to employees
and culture, through the Group Culture Dashboard.

Expansion of LSEG Inclusion Network (IN)*

Below we describe our culture as an new group
following the completion of the Refinitiv transactionin January 2021. The data and initiatives described
relate to LSEG as a standalone business in 2020.

This culture is supported by three core pillars that apply
to all parts of the Group:• Connect: We work as one company to serve ourcustomers. We unify to get the best from our people
and to deliver the greatest value for our customers.
We break down silos, bringing together data, products,
people and partners globally in new and better ways.
We behave as a truly global organisation, creating
inclusive teams that work in partnership with ourcustomers and stakeholders• Create opportunity: We have the courage to think
differently. We are proud of our heritage yet notconstrained by it. We’re curious and willing to disrupt
ourselves. We expand our horizons and recognise thatbrilliant ideas and perspectives can come from anywhere.
We shape markets in ways that create sustainable value
for society and create an impact we’re proud of• Deliver excellence: We execute to the highest
standards. Good enough isn’t good enough – weconstantly challenge ourselves to be better. We deliveron our commitments and take ownership of every
aspect of our work. We know that financial communities
depend on the integrity of our infrastructure and data,and never compromise on stability and resilience

Culture sets expectations for how we behave, how
we work together, how we function as a team and how
we relate to our customers. It’s critical to realising our
purpose of “driving financial stability, empowering
economies and enabling customers to create
sustainable growth” and delivering on our promiseof “Essential Partnerships. Open Opportunities”.
Following the acquisition of Refinitiv ensuring wedevelop and embed a truly unified culture of growth,
opportunity, diversity and innovation has never been
more vital. We recognised this need early on and so a
key focus throughout our integration planning in 2020
was on creating a clear and distinctive culture by bringing
with us the best of how we operated individually.

More than 340 colleagues trained
as Mental Health Champions*	LSEG Inclusion Network (IN) represents seven global networks and
18 regional networks. The global Inclusion Network (IN) meetsregularly at a forum where networks will be able to share knowledge
and collaborate

We recognise that changing culture cannot be done bydecree and doesn’t happen overnight. How we behave
every day creates our culture. It will be core to our future
and will help us attract and develop the very best talented
and inclusive professionals. We’ll recognise and reward
people for building the organisation based on thesecultural traits. To help us achieve this we have set out
four ways to signal our intent to ignite change:• Incentivising behaviour: Our new approach toperformance enablement has been designed toembody our culture. It rewards not just what you do,but how you do it. We’re also designing intended
behaviours into other policies, systems and processes• Leading by example: Leaders will be held accountable
for modelling the change that we want to create, frombuilding teams with talented and inclusive
professionals, to enabling new ways of thinking• Getting people involved: Successful change is createdby the people who are living it. We’ll engage people
across the business in developing a picture of how theculture feels across the business, and in being part ofinitiatives to shape it• Recognition: We want to recognise the people who create
the organisation that we aspire to be. We’ll consistently callout the behaviours that tally with our culture

27

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocial continued
OUR CULTURE
CONTINUED

In 2019, we developed a Culture Dashboard to measure
and assess our culture. The Dashboard provides theBoard and Executive Committee with a quantitative way
to measure and assess progress over time, using data
gathered from our “Have Your Say” employee
engagement survey and other sources, which are allcontinually evaluated to ensure we collect the rightdata to best understand how our people feel.
The Dashboard focuses on five key areas:• Recruitment & On-Boarding: We recruit individuals
with the right skills, behaviours and mindset to support
our strategy• Performance & Development: We set individual goals
that are aligned with enterprise-wide objectives andsupported by a strong organisational learning culture• Talent & Mobility: We identify, nurture and retain talent,promoting internal mobility to support opportunities
across the Group• Diversity & Inclusion: We encourage an inclusive
environment, where diverse perspectives are welcomed,
and all colleagues can be their best selves at work
• Leavers: We use the insights from our leavers to
improve future recruitment and reduce turnover

ATTRACTING
THE BEST TALENT
Develop

Recruitment
Attracting, developing and retaining the right talentrequired by the Group to meet its business objectives in2020 has remained a key focus. Greater effort has been
dedicated to increasing the diversity of our talent pools
in order for us to attract and hire the best talent in themarketplace. Initiatives focused on diversity include
hosting a series of global Diversity and Inclusion supplier
briefings, a full end to end audit of our recruitment
processes, and a market mapping exercise to better
understand the diversity of the external talent landscape.
Graduate and Early Careers Programmes
Our Graduate and Early Career Programmes help to fuel our
growth and diversification. We have 50 graduates on
programmes globally, including our first cohort in Bucharest,

The table below shows our performance in 2020 against one of the indicators from each area fromthe Group Culture Dashboard for LSEG standalone in 2020:
Focus area

Indicator

2020

2019

2018

Recruitment & OnBoarding
Performance andDevelopment
Talent & Mobility
Diversity & Inclusion% of new joiners who understand LSEG’svalues
Hours spent on training

98%

99%

97%

82,99374,77063,150

33%
68%

25%
N/A

23%
N/A

3%

7%

5%

Leavers% of roles filled internally% of respondents that agree regardlessof background, everyone has an equal
opportunity to succeed% of leavers that cited work-life balance as
primary reason for leaving

In 2020, we changed our survey provider to enable us to strengthen the insights from colleague surveys. As a result,some of the questions we included have changed to enhance our ability to assess performance and create newopportunities for benchmarking our results; this includes the Diversity and Inclusion question previously reported inour culture dashboard, therefore no historic data is available for this question.

Romania. These graduate classes remain a key sourceof gender diversity, with 54% female representation in the classof 2020. We have been working to diversify our pipeline
further by running events and working with new partners
that actively target candidates from Black, Asian andMinority Ethnic backgrounds. For our existing recruitment
partners, we mandated they attend a virtual event on theimportance of attracting a more diverse candidate pool,and internally we worked with the Centre for Inclusive
Leadership to create career workshops on internal mobility.
Our early careers recruitment and programmes havealso had to adapt to the new virtual environment, withcareers fairs, insight weeks, global graduate onboarding
and training all taking place virtually for the first time.

Our planned summer internships became a Virtual
Experience Programme with over 50 students fromlocations across the UK, Italy and the USA taking partand subsequently many received offers to join us on our
graduate programmes in 2021. Our Spring Insight Week
programme continued in the UK and expanded in 2020
with our first programme in the US in January 2020 thatgave an insight into our work in data and technology as
well as securing students for our summer internship in 2021.
In addition to our graduate programmes, which provide
structured learning and professional development, we
continue to develop our wider early careers colleagues.
In 2020 we piloted using funding available through theapprenticeship levy in the UK to develop and upskill
our junior colleagues in technical areas such as software
engineering, data and business analysis.

28

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocial continued
SUPPORTING OURPEOPLE IN THEIR CAREERS
Develop

Developing our people
Developing our people remains integral to our agenda
and 2020 has been no exception. Although Covid-19
has meant that we have not been able to hold face
to face training, we successfully transitioned all ourplanned training to virtual delivery and continued
to invest in the development of our colleagues.
We highlighted to colleagues the importance of careerdevelopment, by running a campaign focused onincreasing the visibility of internal opportunities andensure managers evaluated internal talent to seek to fillroles before relying on external hires. This reduces ourreliance on external search firms and helps us to retain
our talent. As a result we have seen an increase in fillingroles internally to 33% compared to 25% in 2019.
Learning and development
We continue to see high levels of engagement in the
online learning that was introduced in 2019. We are
one of LinkedIn Learning’s top quartile users of content.
At the start of the pandemic, we were able to provide
support to colleagues quickly using curated LinkedIn
Learning content on key topic areas such as transitioning
to working remotely and managing resilience. Being
online only for most of 2020 did not disrupt our ability
to invest in and support the development of colleagues
with a total of 82,993 hours spent by colleagues on training.

500+
Mentoring partnerships
supported in 2020

Mentoring
In 2020 we expanded our virtual ‘Mentor Exchange
Connect’ programme, designed to help connect
colleagues across our worldwide business locations
and encourage further Group-wide collaboration,
launching a fully virtual programme for mentoringin 2020. Over 500 colleagues participated in thisprogramme in 2020, up from 300 in 2019. We also ran a
Reverse Mentoring programme which was new for 2020;
more information on this initiative can be found in the
Diversity and Inclusion section.
Investing in our leaders
We are making progress in developing our culture in how
we manage and lead our business. We have supported
the development of both leadership and management
capabilities and continue to invest in these skills in orderto strengthen our succession pipeline and collective
Group leadership. We have continued the investment
in our senior leadership population with the expansionof the 360° feedback process, launched in 2019 for all
Managing Directors, and rolled out to all Directors in
2020. In response to consistent themes that emerged
from this process, we created the LEAD2020 programme.
The LEAD2020 programme was supported by the
Executive Committee and focused on establishing thelink between strategy and leadership, the role of leadershipin building a collaborative culture, leading change, andincluded a module dedicated to inclusive leadership.

Engaging our people
Our annual engagement survey enables colleagues toshare their views on what it is like to work for LSEG andprovides a clear indicator of employee engagement. The
overall response rate in 2020 was 77%. The Engagement
Index score of 81, up one point from 2019, was driven by
the strong levels of and pride and commitment to helping
the Group succeed1. Going forward we will be increasing
the frequency of the survey to twice a year.
As well as the annual employee engagement survey,
feedback comes through: a colleague forum which is led
and attended by elected volunteers from the workforce;
townhalls and Executive Committee meetings which areopen to all employees and held regularly throughout theyear; and Employee-Board engagement sessions withcolleagues from the UK, US and APAC.
In 2020, we developed and launched a new ‘Ways ofWorking’ survey, designed to measure and assess theGroup’s initial response to remote working during the
pandemic. We used the insights to drive actions to further
support wellbeing and strengthen manager capability.

The investment in our Line Manager capability has
continued in 2020 with further rollout of our global
management development programme. All line managers
in LSEG (outside of the Managing Directors and Director
populations) attended the virtual programme during2020. The programme focused on enhancing managers’
ability to coach, develop and delegate effectively.

1.	“I regularly put in extra effort to help the Group succeed” (89%)
and “I am proud to work for the Group” (84%)

29

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocial continued
DIVERSITY AND INCLUSION (D&I)
Diversity and Inclusion (D&I) is critical to LSEG’s
success. We believe that diversity makes us more
dynamic, fosters innovation and boosts performance.
Colleagues are recruited and encouraged to develop
their careers regardless of age, gender, nationality,
culture or personal characteristics. While Diversity
and inclusion have always been a priority, events in2020 refocused our commitment. We continue to work
to make further progress in this area as we aim toembrace all aspects of diversity and seek to create
an organisation that is truly inclusive and wherecolleagues feel they can be their true self at work.
The Diversity and Inclusion Committee is now chairedby our Group Head of Data & Analytics. We have seen
further growth in our global Inclusion Network (IN),which acts as an umbrella group, representing 18
regional networks within LSEG, including our Black
Employee Inspired Network Group (BEING), MultiCultural Network, LGBTQ+ Proud Network, Parents andCarers Network, Disability Network (Ability), our Women
Inspired Network (WIN), and Veterans Network.
As a global organisation we also recognise that diversity
can mean different things across our different locations.
While our focus in the past has generally been centred
on improving our gender diversity, 2020 has shown usthat improving diversity in other ways may require more
focus in some locations. Events in the US and UK in2020 pushed ethnic diversity to the forefront, while inother locations gender diversity remains the priority.
Recognising this is crucial to ensure we can respondas necessary in all our global locations.
The first step in improving our diversity at LSEG isto ensure we have the appropriate data to better
understand our people. We are making efforts toincrease voluntary disclosure across all our locations
through engaging leaders and colleagues face-to-facethrough leadership forums, our Inclusion Networks,
events and encouragement from our Executive Team.
In the UK and US the percentage of colleagues who
disclosed their ethnicity was 81%, as of 31 December
2020. Amongst our UK and US colleagues, 34%
identify as Black, Asian and Minority Ethnic.

• Mentoring: we launched our Reverse Mentoring
programme for our Executive Committee and BEING
members, described below.
• Data: we have invited colleagues to provide theirpersonal diversity information to help shape theactions we take and track our progress.

We hope to improve our ethnicity disclosure rates inother locations as well as other forms of diversity data
throughout 2021 and beyond.

These workstreams will create substantive andsustainable change across the Group by ensuring allcolleagues understand the importance of an inclusive
culture, that our processes are examined and refined toremove any potential bias, and to leverage more diverse
candidate pools. We are proud that we have laid someof the foundations to better embrace diversity andstrengthen inclusion at LSEG.

In our efforts to strengthen diversity and inclusion acrossthe Group and in response to the Black Lives Mattermovement in 2020, we launched six workstreams which
aim to improve our focus on ethnic diversity and make
LSEG a more inclusive environment.
• Culture: we’ve taken steps to open up a Group-wide
conversation about race and diversity, creating a safe
space for our colleagues to share lived experiences.
Our Inclusion Networks have helped us to celebrate
a number of important events, such as Black History
Month, which created opportunities to learn about
racial disparities and injustice experienced bymembers of the Black Community.
• Wellbeing: through our partnership with City Mental
Health Alliance we’ve built a support network ofover 300 mental health champions. We’ve worked
with the provider of our Employee Assistanceprogramme to ensure all colleagues can accessethnically diverse counsellors.
• Hiring: we’ve onboarded eight new recruitment partners
across the UK and the US to help us reach and attracta more diverse pool of candidates. Our partners areworking with us to build diverse shortlists for all roles.
• Training: we introduced mandatory “Breaking the bias”
training across the Group and we’ve embedded
Inclusive Leadership learning in our leadership andmanagement development programmes to better
understand and prevent bias in hiring, performance
management and promotion.

We have also made public commitments on race anddisability equality through the Race at Work Charter,
Sunday Times Open Letter and Valuable 500 initiative.
The BITC Race at Work Charter aims to tackle thebarriers that ethnic minority people face in recruitment
and career progression. As a result of our commitment
to this, we’ve taken steps to ensure our leaders andmanagers are equipped to support equality in theworkplace. Examples include modules for inclusive
leadership and manager training that have been
embedded into LEAD 2020 and Manager Excellence
programmes. We have also launched a Reverse
Mentoring programme for our Executive Committee and
BEING members to help our business leaders understandthe experiences of Black colleagues. This also gives
mentors greater access to senior leadership to raiseawareness on issues, share ideas and develop their own
network. In 2021 we will expand this programme toinclude a wider range of Black, Asian and Minority Ethniccolleagues and involve managing directors.

I’m proud that we have laidsome of the foundations
to better embrace diversity
and strengthen inclusion
at LSEG.”David Schwimmer
CEO

44%

50%

Female representation
at Board level asof year endof our external hires
at senior manager levelin 2020 were female

30

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocial continued
DIVERSITY AND INCLUSION (D&I)
CONTINUED
Signing The Sunday Times Open Letter provides
an opportunity to take action on race inclusion.
This letter made clear commitments about opening
up the conversation about race in the workplace.
Our Inclusion Networks have continued to focus onlistening sessions to raise awareness on issues affectingBlack colleagues, supporting our commitment to a‘journey of learning’. Our partnership with The Centre
for Inclusive Leadership and the work we are doing
to develop new Conscious Inclusion learning helps todemonstrate our commitment to creating a safe place
to discuss and learn about race in the workplace.
The Valuable 500 is a global movement putting disabilityon the business leadership agenda. Our leadership-led
D&I programmes will focus on developing targeted
initiatives to further support colleagues with visible andnon-visible differences which will be established throughdata captured in our D&I data workstream. We also
continue to support the Group’s new Ability Network,
encouraging membership and allyship.
While these initiatives are creating positive change,
feedback obtained from the ‘Have Your Say’ survey
and anecdotal comments indicate there is still work
to be done in creating a truly inclusive culture at LSEG.
Diversity remains an important factor in our succession
planning and other appointments. We have included thisconsideration when selecting our Executive Committee
for the combined group. Further details on thenomination process can be found in our Annual Report.

Gender Diversity
The Group was an early signatory of HM Treasury’s
Women in Finance Charter in the UK, and we set ourselvesa stretch target of reaching 40% female representationin our senior leadership population by the end of 2020.
In 2020 we have reached 37% of senior leadership level
female representation across Group, while this is below
the 40% target we set, we have made good progressand recognise we have more to do to achieve this target.
In terms of female representation at Board level,
the Hampton-Alexander report recognised the Group formaking significant improvements that have led to womencomprising 44% of our Board. In 2020 we have continued
to strengthen our leadership and manager capability
to ensure all processes consider diversity of thought
and inclusive mindsets. We continue to promote
initiatives to support and develop diverse talent at LSEG,
both through our internal work, with our WIN network,
which has continued to expand across our key regions in
the year, and working with external partners such as the
30% club cross-company mentoring scheme.
These initiatives have resulted in an increase in the
proportion of female candidates hired across the group.
In 2020 at senior manager level, 50% of our externalhires were female rising from 41% in 2019.
Gender Pay Gap
At LSEG, we conduct equal pay analysis as part ofour annual pay review process and are confident that
we do not differentiate pay between men and women
who perform equivalent roles. We have a Group-wide
reward framework, which establishes the compensation
structure, elements and leverage for each stage in our
career framework. This is used to review any potential
gender bias as part of our annual pay review process.
However, we acknowledge that we do have a gender
pay gap, due to the unequal distribution of men andwomen across the company.

2020
Gender breakdown
LSEG plc Board
LSEG Subsidiary Board1,3
ExCo and Leadership Teams2,3
All other colleagues
Total4

Female
4
28
172
1,750
1,922

%
44%
20%
37%
34%
35%

2019
Male
5
110
298
3,334
3,632

%
56%
80%
63%
66%
65%

Female
4
31
140
1,577
1,717

%
31%
19%
32%
35%
35%

Male
9
132
291
2,957
3,248

1. Mix of employees and Non-Executive Directors
2. Executive Committee and Leadership Teams in LSEG
3. 	The LSEG Subsidiary Board members and the members of the Executive Committee and Leadership Teams
together comprise the ‘Senior Managers’ for the purposes of section 414C(8)(c)(ii) of the Companies Act 2006
4. Total comprises Executive Committee and Leadership Teams and All other colleagues
Note: Figures as of year ended 31 December 2020

We go beyond UK statutory disclosure requirements toincrease transparency, provide a more accurate pictureof our gender pay gap and establish a more meaningfulbaseline against which to track progress. Our 2020
global gender pay gap mean reduced by 2% from 23% in2019 to 21% and the median remained the same at 10% in
2020. The biggest factor behind our gender pay gap
continues to be the fact that there are fewer women insenior positions. We recognise we need to do more to
improve in this area and we have continued to focus on
talent acquisition and development of female talent,particularly at senior levels, resulting in increased
representation at senior leadership level. Our latest
gender pay gap report was published in March 2021.
This report can be found at:www.lseg.com/investor-relations/sustainability

We hope our members andthe wider LSEG community
have enjoyed the social
engagements this year,
learnt from the experiences
shared and have grownin their understanding.”
Black Employee Inspired
Network Group (BEING)

%
69%
81%
68%
65%
65%

31

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocial continued
REWARDING OUR PEOPLE
Develop

1,100
employees benefited
from Sharesave maturities

HEALTH AND SAFETY
DevelopOUR PEOPLE IN NUMBERS
Develop

LSEG’s reward strategy focuses both on the short term,
through an annual bonus scheme linked to our global
performance management approach, and on themedium term through share plans aimed at senior
management and the wider workforce. The Long-Term
Incentive Plan, details of which can be found on page 111
of our Annual Report, aligns the performance and reward
of senior management with the Group’s ongoing
performance and growth.
In 2020, we operated two employee share ownershipplans for permanent employees, split across nine countries.
Under Sharesave, eligible colleagues can save up to £500
or equivalent per month, with the option after three years

In 2020 the Covid-19 pandemic was a key focus for thehealth and safety activities of the group. We took a seriesof steps to ensure our colleagues could work safely fromhome during the pandemic including provision of training
on workstation set-up at home, and the provision of IT/
office equipment. We ensured each of our buildings hada Covid-19 risk assessment in place and control measures
implemented to ensure Covid-secure workplaces aheadof any return to office. In 2021, we will continue to ensurethat the health, safety and wellbeing of our colleagues
is at the forefront of our thinking as we plan a phased
to return to office when regional restrictions allow.

On 31 December 2020, the Group employed 5,566
employees, up 12% from the end of the previous reporting
period, mainly due to the continued expansion of
our Business Service Centres in Romania and Sri Lanka
to support our growing global business. While thisappears to be a large increase over 2019, actual newhire numbers were relatively flat and the increased
headcount is due to the much lower voluntary turnoverrate in 2020 due to the Covid-19 pandemic, reducing
the usual churn of vacant roles.

of using their accumulated savings to buy LSEG sharesat a discounted price. SharePurchase allows eligible
colleagues to purchase up to £500 of LSEG shares
per month and receive an award of additional shares,
which vest after completion of a three-year plan cycle.
No SharePurchase cycle has yet completed but, during
2020, more than 1,100 employees across seven countries
were able to benefit from Sharesave maturities including
share price appreciation of 163%, reflecting the Group’s
performance over the previous three years. There wasalso increased take up under both employee shareownership plans, increasing overall participationin 2020 to 61% of eligible employees.

Our Italian offices successfully completed their ISO
45001 accreditation in 2020. More widely, we undertooka detailed gas analysis against our Group Healthand Safety Framework involving all our global offices.
Following on from this work we ensured action was
taken where necessary to ensure continued compliancewith framework requirements, as we look to continually
improve performance going forward. Reviews also took
place of our contractor management and incident
management processes.

We endeavour to develop a remuneration policy thatis aligned with good market practice and corporate
governance developments and which continues topromote the long-term success and cultural agendaof the Group. The Remuneration Committee continues
to place great importance on ensuring that there isa clear link between pay and performance, including
a focus on culture, adherence to the Group’s risk
framework, and that our remuneration outcomesare reflective of this wider context. More informationon our Remuneration policy can be found on page 103
of our Annual Report.

As part of the planning for the Refinitiv acquisition a
new Group Health, Safety and Environment (HSE) Policy
has been approved. In 2021 our focus will be on how
we integrate the respective businesses’ health, safety
and environment management systems across a vastly
increased office portfolio, whilst maintaining existing
compliance levels. This will encompass not just policies andprocedures, but our training, risk assessment, audit and also
the IT software systems that support our HSE management.

Employee-based indicators

2020

2019

2018

New Hires
Voluntary Turnover
Permanent Contracts
Fixed-term Contracts

1,120
6.0%
97%
3%

1,194
10.5%
98%
2%

978
11.0%
98%
2%

32

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocial continued
SUPPORTING OURPEOPLE’S WELLBEING
Develop340+
Mental Health Champions
trained in 2020

Wellbeing – LSEG’s Wellbeing strategy provides
dedicated framework of awareness and support centredaround five pillars: Emotional, Physical and Financial
Wellbeing, Workplace Choice and Social Purpose.
We work with a range of strategic partners who provide
advice and help strengthen the framework to ensure
we are offering our colleagues the best support, tools
and services. Having this framework has allowed us torespond to Covid-19 to truly support colleague wellbeing.
Financial Wellbeing – New Financial Wellbeing
workshops delivered to colleagues in the UK, Italy, Sri
Lanka, and APAC. In addition to our existing seminars andworkshops targeted at different life stages, we have also
been working with Wealth at Work who were onboarded
as a new supplier to provide sessions and offer a specific
Covid-19 Financial Wellbeing workshop. We also havedeveloped and launched a Wealth at Work microsite
through our Group intranet services.

Emotional Wellbeing – Emotional Wellbeing continued
to be a priority throughout the pandemic, by partneringwith City Mental Health Alliance to train more than 340
colleagues to create a virtual network of champions
to offer support and signpost information and services.
The training was delivered globally, to promote earlyintervention for colleagues. We promote this community
via visual identities attached to colleague signaturesand via our intranet. Alongside this training, the Grouphas provided a webinar series for all colleagues, focusedon addressing fatigue, and maintaining connection
and positivity throughout uncertainty.
In 2020 we ran the Group’s first Global Mental Health
Awareness Week which celebrated World Mental Healthday, promoting the Lord Mayor’s Green ribbon campaign
which aims to end the stigma around mental health.
Following on from rolling out the Global Employee
Assistance Plan to extend support for all colleagues
across the Group, this year we delivered Employee
Assistance Programme training sessions to all colleagues
to promote how EAP can provide support for them.
Physical Wellbeing – Our Executive Committee
members delivered personalised videos to share tips andexperiences working from home, as well as conducting
virtual ‘fireside chats’ to share information. Teams also
took part in fitness challenges, desk yoga, and virtual
quizzes to stay connected beyond regular work meetings.

Social Purpose – We are committed to supporting
our local communities and offer several ways for ourpeople to do this, such as offering employees two
paid volunteering days each year and runningcharitable events through the LSEG Foundation.
More information about our work in this area canbe found in the Foundation section of this report.
Workplace Choice – We understand that striking theright work-life balance is essential for the wellbeingof our people; and we recognised from the results ofour engagement survey in 2019 that this was an area
where we needed to do more.
With everyone working remotely we needed tounderstand how we can provide this support whilecolleagues continued to work remotely. We publishedregular Wellbeing articles to support colleagues working
remotely, and our Parents and Carers US and UK
Network have partnered with Timewise event during2020 Global Inclusion Week and Mental Health AwarenessWeek to discuss with parents and carers how they can
optimise their time and communicate with Line Managers
if they need support.
More information about how we responded to
the Covid-19 pandemic can be found on page 4.

33

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocial continued
LSEG FOUNDATION
Sustain

The LSEG Foundation was established in 2010 to be
the single channel for the Group’s charitable giving anda focal point for staff engagement with charities. Its core
mission is to empower people and enrich communities.
The Foundation focuses on projects that help young
and disadvantaged people reach their full potential bydeveloping life skills and business acumen. Additionally,as our global presence grows, we continue to engage
and give back to the communities we operate in.
Partnering with local charities allows the LSEG
Foundation to have a long-lasting impact.
In 2020 we ran the second LSEG Foundation Challenge
which saw over 2,100 volunteering hours donated bymore than 400 LSEG staff during a five-month period,
with Sri Lanka the winning region, receiving an additional
grant to support their chosen charity in 2021. Sri Lanka
also won the Most Innovative Challenge, running a social
media based fundraising activity. We also celebrated
the LSEG Foundation’s 10th anniversary. Over the past
10 years over £11 million has been donated to support
almost 400 charities. To mark the anniversary, we hosted
a global week of virtual celebration, in partnershipwith our regional partner charities and our global
partner charity UNICEF.
Partner charities
In 2020 we elected a new partner charity in Malaysia
and local partner charities covering APAC regions.

2,100
Volunteering hours
donated in 2020

USA
City Harvest, New York City’s largest food rescue
organisation, helps to feed more than 1.5 million New
Yorkers who are struggling to put food on the table.
In 2020, a number of colleagues participated in a virtual
5K and 10K race to raise funds. The amount raised wasmatched by LSEG Foundation. Nearly 1.6 million New
Yorkers have lost work and income since Covid-19, andfood insecurity Is expected to surge nearly 40% in NYC.
2020 also saw the return of the successful fundraiser“Skip Lunch to Fight Hunger”; the amount raised wasmatched by the LSEG Foundation.
Italy
Associazione CAF Onlus has been our Italy Charity
Partner since May 2019. The charity is a leading national
non-profit organisation dedicated to helping victimsof child abuse and neglect.
In 2020, due to the impact of Covid-19, the activities
conducted by the volunteers were managed remotely.
Each of the LSEG volunteers was paired up with a childto support with homework and a distant-learning session
on video. Volunteers and children shared materials in
advance to help organise the session, as well as allowing
for moments for a freer exchange of ideas between
volunteer and child.
Romania
Ajungern Mari aims to create an educational centre for
institutionalised children from Bucharest, a place where
they can feel free and supported to develop their skills
and discover new ideas for their future.
In 2020, Ajungern Mari created online challenges withchildren from orphanage houses. They shared the tasks
and responsibilities during the workshops with thechildren, and all of them worked together with thechildren to encourage and support the team in several
learning based activities.

UK
Our UK Charity Partner School-Home Support tackles
the issues that prevent disadvantaged children from
attending and succeeding at school. Although school
closures and the lockdown due to Covid-19 have affected
our regular volunteering programme, LSEG staff remaincommitted to building connections and making
a difference to the lives of vulnerable families.
In April, as a response to Covid-19 LSEG launched adigital Financial Literacy for Children Programme to assist
with home schooling. The programme included videos
created by another charity partner, City Pay It Forward.
Sri Lanka
In 2020, LSEG Sri Lanka provided national-level support
during the Covid-19 outbreak to the Sri Lankan Government.
The Group’s donation contributed towards medical
equipment and setting up a Covid-19 Isolation Unit.
This provided over 1,850 families with essential supplies.
Malaysia
DASwk is an established and registered non-profit NGO
based in Kuching, Sarawak, Malaysia. The charity advocatesfor children and individuals affected by dyslexia and otherlearning disabilities through promoting awarenessof and intervention programmes on the cause.
The charity committee organised a visit consistingof 11 volunteers to the local charity partner sites.
The intention was to familiarise volunteers with the local
charity partner’s operation situation as well as follow-up
on the three-year project with the association.

34

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

AppendixSocial: progress in 2020 continued
LSEG FOUNDATION CONTINUED
SustainCommunity contributions from the Group in 2020
Based on the London Benchmarking Group (LBG)
methodology, we report our donations and otherfactors that reflect the Group’s overall engagementwith our communities.
In 2020, the Group made an overall donation to LSEG
Foundation of £1,764,000 which is 9% higher than
2019. An additional £3,173,000 was donated directly
to charities by the Group, bringing total donations
to £4,937,000, significantly higher than 2019 due
to our response to Covid-19 (see page 4 for more detail).
The 2020 Charity Trading event raised £1,123,000, 59%
higher than 2019 over a two-day period (previously
this has only been one day). Total grants approved
and paid reached £2,003,000.
Principal sources of funding 2020
Employees
Foundation Day

Corporate

Employees make donations
and organise fundraising events
The Group donates the equivalent of
all equity trading fees raised on London
Stock Exchange, Turquoise and Borsa
Italiana during the annual Foundation Day
The charitable donations from othercompanies in the Group contributeto the Foundation’s donation pool

LSEG community
investment charitable
donations
Donations to LSEG
Foundation
Donations to charity
In-kind donations
Management costs
Total

2020
£’000

2019
£’000

1,764

1,616

3,173
0
158
5,095

130
141
131
2,018

2018
£’000
1,254
207
143
194
1,798

In 2018, LSEG Foundation Committee set out a listof strategic priorities for 2019-2022, supported by anaction plan based on four focus areas: i) Maintain deepalignment with our mission; ii) Encourage colleagues’
engagement and enhance a culture of collaboration; iii)
Invest in business inclusion and entrepreneur skills; iv)
Invest in bringing LSEG philanthropy programme alive.
These priorities support and sharpen the overarching
LSEG Foundation strategy, set out above.
We also identified a further three elements connected
to our community engagement: in-kind donations,
free venue hire for charities at our premises in the
UK and Italy; management costs, the cost of timeof the managers involved in our Board of Trustees;
and charity committees across the Group, ourFoundation’s programme office and the corporate
functions that support staff engagement programmes.
In 2019 London Stock Exchange has scaled up its
volunteering programme, based on the strategic
programme approved in 2018. Based the achievementin 2018 of the initial 2020 15% target in terms of proportionof the employee base involved in volunteering, in2019 we raised the 2020 target to 25%. In 2020, 650
employees across seven regions, equivalent to 13%
of LSEG colleagues, were involved in volunteering
activities. We acknowledge this is below our targetof 25%. This is largely due to the impact of Covid-19
however, we were able to run a number of virtual
volunteering events; for more information see
our Foundation initiatives on page 33.
Donations from LSEG Foundation
Total grants approved and paid were over £2,000,000.
In addition to the grants to the Group partner charities,
this amount includes the small grants disbursed as partof LSEG Matching scheme, which doubles the funds
raised by employees through fundraising initiatives,
up to £2,000 per year per person (€2,000 in Italy).
In 2020, more than £100,000 was raised by our
employees and matched by LSEG Foundation.

Impact reporting
Given the strategic objective of maintaining deepalignment to the mission included in the 2018 strategic
review, we’ve continued measuring the alignmentof our grant-making activity with the LSEG Foundation’s
mission, with particular reference to the one-off donations
recommended by the Regional Charity Chairs to LSEG
Foundation’s Board. In 2020, mission alignment was
94% (+4% versus 2019). The remaining 6% of donationis related to wellbeing ( as opposed to life skills andbusiness enterprise) – excluding the one off donationin response to Covid-19.

94% 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 attitude change,termed “raised aspirations”, 19%, or at the developmentof skills and personal effectiveness, 75%. The small
percentage of “Quality of life or wellbeing” donations
equivalent (6%) supporting projects in hospitals to give
seriously ill children and young people the best chanceof a full life.
Impact of LSEG Foundation grant on beneficiaries
6%

Based on the LBG Impact reporting framework,
we ask charities to report on three 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 itchallenged negative attitudes orpreconceptions, enabling them to makewider, different or more informed choices?
2. Skills or personal effectivenessHas the activity helped people todevelop 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)?

19%
Behaviour or attitude change
Skills or personal effectivenessQuality of life or wellbeing

75%

Within impact areas 1 and 2 (“Behaviour or attitudechange” and “Skills or personal effectiveness”),
donations are perfectly aligned with our mission.
Target skills to be developed with our donation
26%
Employability or enterprise skills
Life skills

74%

74% of the donations are aimed at increasing theemployability of the beneficiaries or at developing financial
or business skills, for which the UNICEF Zambia project
plays a large role. 26% is focused on developing life skills.

35

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance
SUSTAINABILITY GOVERNANCE

GovernanceOur approach to sustainability is overseenby the LSEG Board. The CEO is responsible
for and reports to the Board on sustainability
matters, while the COO is responsible
for and reports on environmental policy.
In 2020, the Board discussed sustainability
and environmental matters on two occasions.
Our sustainability strategy is driven by the Group
Sustainability Committee, comprised of Executive
Committee members and other senior executives
that represent a wide cross-section of relevant businessareas. Delivery of the sustainability programme is carriedout by the Sustainable Business team and our related
sustainability initiative teams, such as our global Inclusion
Network (IN). These teams also feed back into the Group
Sustainability Committee directly to input into the overall
approach and direction of our sustainability activities.
This process allows us to draw on a wide range ofknowledge and experience from across the Group.
Delivery during 2020 was overseen by the Group Headof Investor Relations and Group Head of Government
Relations and Regulatory Strategy. From 1 February 2021,
the Chief Communications and Marketing Officer chairs
the Group Sustainability Committee.

LSEG Board

LSEG Executive Committee

LSEG Sustainability Committee
Chair; Chief Communications and Marketing Officer

Programme Delivery OversightGroup Head of Investor Relations;Group Head of Government Relations and Regulatory Strategy
Programme Delivery
Head of Sustainable Business; Sustainability Manager

Foundation

Environmental
Management
Group (EMG)

Inclusion
Network (IN)36

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
SUSTAINABILITY RISK MANAGEMENTThe Sustainability Committee reports at the executive
level on our climate-related and other sustainability risks
as well as providing oversight and accountability acrossall relevant initiatives, and any associated opportunities.
With respect to this, it is acknowledged that althoughclimate-related risks have been categorised as an
emerging risk in the Principal Risks section of our
Annual Report, they are inherently linked to otherstrategic, financial and operational risks, as well as
commercial opportunities. Climate-related risks, andother sustainability related risks and opportunities, arefully embedded within our risk taxonomy and fall within
the scope of our Enterprise Risk Management (ERM)
framework. To further align with Task Force on Climaterelated Financial Disclosures (TCFD) recommendations
and prepare for future regulations, we are preparing
a new risk taxonomy for 2021 giving climate-relatedrisks greater visibility and facilitating sustainability risk
reporting at a more granular level. In addition, Risk
Champions have direct access to the Sustainability
Risk team and are provided with a dedicated climate
and sustainability risks training pack, regularly
updated and available within the risk registerdatabase for reference and support.

Over the last twelve months LSEG has undergone
multiple exercises to define and measure thesignificance and relevance of climate risks andopportunities to LSEG’s operations and business
units. For more details see page 50

Environmental and climate risk
We support consistent global standards and encouragecontinued alignment between the EU and UK on
sustainable finance. We have been members of the
EU High Level Expert Group and the Technical Expert
Group on Sustainable Finance, and the FCA/PRA
Climate Financial Risk Forum.
LSEG is an advocate of the TCFD and supports
the development of global disclosure standards. Asa signatory to the TCFD since the guidelines were firstreleased in 2017, LSEG annually discloses information
on how we expect climate change (and the associatedtransition to a low-carbon economy) to impact ourbusiness in the near to long-term future and we arecommitted to continue fully aligning our disclosure with
TCFD’s recommendations. LSEG has also been
submitting its annual CDP climate disclosure since 2010and has maintained a rating of A- for the last four years.
In line with increased disclosure requirements forcorporations and financial markets participants, LSEG
has taken proactive steps to develop its methodology
to define and model how climate change impacts its
operations and businesses. To further align with the
TCFD recommendations, the Group is undertaking
scenario analysis over both the medium and longer term
(2035 and 2050), and how these may impact operationaland market risks. The aim is to reinforce the Group’s
resilience to physical risks today and in the future; toaddress transition risks and opportunities; be preparedfor potential future mandatory reporting requirements;
and to protect the Group’s reputation. See our TCFD
disclosure on pages 56–57 for more detail.

The TCFD classifies climate-related risks into two categories:• Transition risk refers to risk related to the transition toa lower-carbon economy, and entails policy, technology,
and market changes to address mitigation and adaptation
requirements related to climate change. It may impose
a financial and reputational impact to companies.
• Physical risk refers to risk related to the physical impactsof climate change, and includes event driven (acute) or
longer-term shifts (chronic) in climate patterns. It may havefinancial impact for companies, such as direct damage toassets and indirect impacts from supply chain disruption.

High-level introduction to scenario analysis
A thorough understanding of potential physical andtransition risks and opportunities will ensure that LSEG
makes informed decisions in terms of long-term strategy,
business resiliency and risk mitigation in the future. Overthe last 12 months LSEG has undergone multiple exercises
to define and measure the significance and relevance ofclimate risks and opportunities to LSEG’s operations andbusiness units. A scenario scoping exercise was conducted
to determine the most suitable climate scenarios to apply
to our business (see table below and impact pathways
for the scenario analysis were developed.
Impact pathways are tools to help corporations
understand and establish the causal links betweenchanges in climate and weather patterns, related nationaland global policies and the impacts on business in termsof costs, revenue and asset values.

Two physical risks and two transition risks scenarios were chosen to project changes in an approximately
2 and 4 degree warming world.
Physical risks

Transition risks and opportunities

Scenarios andtimeframes~2 degree
warming
scenario~4 degree
warming
scenario

Scenarios andtimeframes~2 degree
warming
scenario~4 degree
warming
scenario

Scenarios
for financial
impact analysis
used

IPCC SSP245

IPCC SSP585

Scenarios
for financial
impact analysis
used

IEA Sustainable
Development
Scenario (SDS)IEA WEO
Stated Policies
Scenario (SPS)

Timeframesconsidered

2030 & 2050

2030 & 2050

Timeframesconsidered2025 & 2035

2025 & 2035

37

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
KEY POLICIES AND COMPLIANCE

Good governance is key
to promoting the long-termsustainable success of thecompany, generating value
for shareholders, building andmaintaining relationships withstakeholders and contributing
to wider society.”
Don Robert
Chair
LSEG is committed to the corporate governancestandards set out by the UK Corporate Governance
Code, which in 2014 was updated to strengthen thefocus on long-term sustainable value creation. For afull description of our corporate governance frameworkplease see the 2020 LSEG Annual Report, while we setout our sustainability governance on page 35 of thisreport. You may also refer to the GRI Index available atwww.lseg.com/investor-relations/sustainability

Anti-bribery and Corruption
Executive Committee Responsibility, Group CEO
Consistent with LSEG’s strategic risk objective of
maintaining stakeholder confidence, we regularly
review both the risks associated with our businessconduct and our related policies. As a result, LSEG has
in place a Code of Conduct, Anti-bribery and Corruption,and conflict of interest policies, approved by the Board.
Financial Crime (including Anti-money Laundering)
Executive Committee Responsibility, Group CEO
This 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 anddeterrence of financial crime is a key objective for many
regulators worldwide and continues to be a high priority
for governments. Consequently, financial crime posesa 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 the Group and approved persons
to civil and criminal sanctions including heavy fines,
restrictions on business activity and loss of relevant
regulatory authorisation. LSEG is committed tosupporting government, law enforcement andinternational bodies to combat the use of thefinancial services sector to facilitate financial crime.

Group Information Security
Executive Committee Responsibility, Group CIO
This policy outlines the Information Security
requirements across LSEG. It addresses a numberof risks, including: data loss or theft which could resultin unauthorised access to systems or company
information; the threat of malware; and the loss orunauthorised alteration of company data, including
personal and confidential information which could
expose LSEG to the risk of non-compliance with legal
obligations of confidentiality, data protection and privacy.
Business Continuity Management (BCM)
Executive Committee Responsibility, Group CRO
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 threats to an organisation and the impacts tobusiness operations those threats might cause. It provides
a framework for building organisational resilience withthe capability for an effective response that safeguards
the interests of its key stakeholders, reputation, brandand value-creating activities. BCM includes all activities
relating to: business recovery planning; IT service
continuity planning (including disaster recovery); and crisis
management. The purpose of this policy is to ensurethat the Group has a feasible, practical, cost-effective
and tested Business Continuity Management Framework(BCMF) and that controls exist which ensure that theGroup operates within its overall risk appetite.

Cyber Security
Executive Committee Responsibility, Group CIO
Cyber security is a key non-financial sustainability riskin the financial services sector. Our reputation and ability
to fulfil our purpose as a critical markets infrastructure
provider is dependent on the secure management ofdata and assets. In order to maintain confidence in ourassets, security controls have been implemented toprotect the confidentiality, integrity and availability of
LSEG and Group company data and systems. Given theincreased size and scope of our businesses, we face awide number of technology risks, such as cyber threats,systems resilience and new technological innovation.
The threat of cybercrime and the evolution of the cyberthreat landscape requires robust cyber security defences.
Long-term unavailability of systems and corruptionof data could lead to the loss of client confidence
and reputational damage. Security risks have escalated
in recent years due to the increasing sophisticationof cybercrime. LSEG continues to invest significantly
in cybersecurity to protect LSEG, our clients andstakeholders. The Group is reliant upon secure premises
to protect its employees and physical assets, as well
as appropriate safeguards to ensure uninterrupted
operation of its IT systems and infrastructure. Security
threats are treated very seriously. The Group has robust
physical security arrangements, and extensive IT
measures are in place to mitigate technical security risks.
The Group is supported by the Centre for the Protectionof National Infrastructure (CPNI) in the UK, with both
physical and IT security teams monitoring intelligenceand liaising 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.

38

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
Compliance training
Given LSEG’s role at the heart of capital markets,and the Group’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 areembedded into the Group’s operations through a seriesof policies that are enforced through periodic training
and auditing. This year, the Group’s compliance training
programme has included training on the following policies:

In Q2 2020 we changed the platform used to deliver our training courses and as such the below statistics are shown
per quarter from Q2 onwards rather than per course as previously reported.
Quarter training released Training provided
Q1

Q2

Q3

Q4

Business Continuity Management
Cyber Security
EU Benchmarking Regulations
LCH Incident Management ProcedureYour Role in avoiding Tax Evasion
Code of Conduct
Preventing Harassment and Discrimination
Data Protection (GDPR)
Privileged Access Management
Conflicts of Interest
Financial Crime & Anti-money Laundering
Preventing Bribery & Corruption
Breaking the Bias (formally known as Unconscious Bias)
Gender Discrimination

CoverageCompletion

Italian Staff
All Staff
All Staff
All LCH Staff
All Staff
All Staff
All Staff
All Staff
IT Staff
All Staff
New Joiners
New Joiners
All Staff
Romanian Staff

98%
99%
99%
93%

90%
89%

98%

Additionally, all new joiners are provided with training on Competition Law, An Introduction to LSEG Policies,
Information Security, Privacy & Data Protection and EU Benchmarking throughout the year.

HUMAN RIGHTS
LSEG adheres to the UN Guiding Principles
on Business and Human Rights, together
with the International Labour Organization
Conventions and Recommendations within
our working environment in each location
where we operate.

The Group strongly supports these conventions which
promote freedom of association and equality and abolishforced labour and child labour. Human rights
considerations are also included in our Supplier Codeof Conduct and Sustainability Policy.
Our updated risk assessment and research in 2020
has again indicated that LSEG operates in an industry
where the risk of modern slavery and human trafficking
is inherently low. However, we operate as a global
business and therefore recognise the risks of partneringwith a varied spectrum of global suppliers and of slavery

occurring deeper in those complex supply chains.
We also acknowledge that modern slavery is getting
more prominent globally given recent events, leading
to financial insecurity for many and increased
vulnerability. We want to become a market leader
in fighting modern slavery, helping to contributeto the UN Sustainable Development Goals target
to bring the modern slavery figure close to zero by 2030.
The Group believes we can have a strong impact given
the financial sector has unparalleled influence over global
business and can invest in and foster the best practices.

The Group has a zero-tolerance approach to modern
slavery. Some of our key actions taken in 2020 in orderto make advances in tackling modern slavery were:• Refreshed risk assessment on our current supplierbase to identify the highest risk suppliers from a slavery
perspective which has confirmed majority of our relevant
supplier spend is with suppliers in our lowest slavery
risk tier. Our procedures and anti-slavery approaches
continue to be appropriate and proportionate• Increased our acceptance of LSEG’s Supplier Codeof Conduct across our supplier base
• Engaged our key suppliers and our highest risk suppliers
to have an understanding of the governance, processes
and where they are further advanced than LSEG to use
as an opportunity to progress ourselves in this space
The most recent version of our modern slavery
statement can be found at: www.lseg.com/investorrelations/sustainability

39

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
ENGAGEMENT WITH STAKEHOLDERS
AND SHAREHOLDERS
The Board views clients, regulatorsand employees as key stakeholders.
Here we provide a brief commentary on
our engagement with these stakeholders
in 2020. More information on our stakeholder
engagement can be found in the Annual
Report on pages 68–69.

Our Customers
We engage with our customers across our businessin a number of different of ways. In 2020, some examples
are outlined earlier in this report on pages 13–20.
Our Regulators
As a global financial markets infrastructure business,
LSEG works across the marketplace with investors,
issuer companies, policy makers, regulators, academics
and other stakeholders to support global financial
stability and sustainable economic growth.
LSEG is committed to using its position at the heartof financial markets to contribute to the developmentof effective and proportionate sustainable finance policy.
LSEG supports issuer companies with ESG reporting
tools and access to sustainable capital. We also workwith investors to integrate sustainability into theinvestment process.
The lack of globally comparable and reliable disclosureand taxonomies is a key barrier to effective integrationof climate and sustainability risks and opportunities byinstitutional investors and the transition towards a moresustainable and net zero economy. In order to encourage
global coherence, LSEG engages with key policy makers
in the UK, EU, North America and Asia Pacific to share
our market experience and provide data and support
to regional and global policy making.

LSEG’s structured engagement in policy making
forums includes:

The TEG has delivered recommendations on thesefour workstreams.

UK Climate Financial Risk Forum
LSEG is a member of the Climate Financial Risk Forum(CFRF), an industry forum jointly convened by the
Prudential Regulation Authority (PRA) and the Financial
Conduct Authority (FCA) to build capacity and share bestpractice. Since its inception in March 2019, the CFRF has
published a report with industry best practice on disclosure,scenario analysis, risk management and innovation.

LSEG is a member of the European Financial Reporting
Advisory Group (EFRAG) taskforce on preparatory work
for a possible EU non-financial reporting standard,
which will publish a report in Q1 2021.

UK Green Finance Institute
LSEG is an active member of the Green Finance Institute.
The purpose of the Institute is to bring together the UK’s
existing capabilities, create new business opportunities
and communicate to the wider market what London’soffer is in green finance and insurance.
EU Technical Expert Group on Sustainable Finance and
EFRAG taskforce on non-financial reporting standards
In July 2018, the European Commission establisheda Technical Expert Group on sustainable finance (TEG)
to assist in the development of a unified classification
system for sustainable economic activities, an EU green
bond standard, methodologies for low-carbon indicesand metrics for climate-related disclosure. LSEG has
been a member of the TEG, and contributed to reports
in the following areas:• EU taxonomy – to develop draft technical screening
criteria on whether an economic activity
is environmentally sustainable;• EU Green Bond Standard;• methodologies for EU climate benchmarks
and disclosures for benchmarks;• guidance to improve corporate disclosure of climaterelated information.

Broader engagement
LSEG regularly engages with policy makers andregulators in key jurisdictions, including HM Treasury,
Financial Conduct Authority, Bank of England, European
Commission, Council and European Parliament, US
Commodity Futures Trading Commission (CFTC), China
Securities Regulatory Commission, People’s Bank of China,
Japan Financial Services Agency and other authorities
and international organisations like IOSCO to discuss
legislative proposals and contribute to the developmentof sustainable finance policy. Public policy speakers at
LSEG events in 2020 included Martin Spolc and Andrea
Beltramello, European Commission; CFTC Commissioner
Rostin Behnam; Alok Sharma, UK Business Secretary; andMark Carney, Advisor to the UK Prime Minister for COP26.
Our Workforce
Employee engagement continues to be of paramountimportance to the Group, and we are committed to acting
on the results of our regular “Have Your Say” global
employee surveys. Details of how we have engaged with
our people in the year can be found pages 26–32.
Our Shareholders
The Company maintains an active shareholder
engagement programme, managed through the Group’s
Investor Relations (IR) function. The IR programme
provides regular opportunity for the Board to havecontact with existing and potential shareholders.
In 2020, the IR team held over 700 investor meetings.

40

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
TAX TRANSPARENCY

Executive Committee Responsibility
LSEG has refreshed its Global Tax Strategy in light of theclosing of the Refinitiv transaction, which has been agreed
by the board and will be published on the Groups website.
The refreshed strategy builds upon the Group’s tax
governance policy and seeks to define enhanced
understanding on how we manage tax risks, our attitude
to tax planning, tax risk appetite and how we work with
tax authorities around the world.
The Global Tax Strategy includes our core principals
on which our strategy is based on.
The Group’s underlying effective tax rate for the period
in respect of continuing underlying operations andexcluding the effect of prior year adjustments was 24.4%.

The Group continues to monitor the evolving tax
landscape and potential developments with US tax reform.
While there are no material changes to the underlying tax
base or rates for 2021, we note that the recent UK budget
announcement indicates the UK corporate tax rate will
increase to 25% from April 2023. Accordingly, we haveconsidered the impact of the increased rate on therevaluation of the Group’s deferred tax assets and liabilities,
which will be required during 2021.

The Annual Report also discloses the split
between the current year corporation tax charge
in respect of the UK and Overseas. However, the tablebelow provides further detail, summarising the total
underlying tax charge, including prior year adjustments,
recorded across our main operating countries.

Therefore, considering the mix of profits for theorganisation combined with Refinitiv, the Group should
expect to record a reported tax rate on an underlying
basis of between 22% to 24% for 2021, which forms ourbest estimate of forward guidance.
The Groups Annual Report provides a reconciliation
between the Group’s total tax charge of £198 million,
which includes both Underlying and Non Underlying
items and the theoretical amount of tax if the Group’s
profit before tax had been taxed solely at the UK rateof 19%. This reconciliation is summarised below:

Profit before tax
Profit multiplied by standard rate of corporation tax in the UK
Expenses not deductible
Overseas earnings taxed at higher rate
Adjustments in respect of previous years
Deferred tax not recognised
Adjustment arising from changes in tax rates on amortisation of purchased intangible assets
Taxation

2020
£m

2019
£m

685
130
(15)
70
(2)
10
5
198

651
124
18
38
(3)
5
4
186

Country

Profitbefore
tax
£m

Tax
£m

Effective
tax
rate

UK
USA
FranceItaly
Sri Lanka
ROW
Total

613
97
93
207
9
42
1,061

(116)
(30)
(30)
(68)
(2)
(10)
(257)

19%
31%
32%
33%
20%
25%
24%

Additionally, the Annual Report discloses the Groups
total cash contribution for taxation during the year.
For 2020 the Group paid £232 million in taxes acrossits global footprint in respect of corporation tax.

41

London Stock Exchange Group plc
Group Sustainability Report 2020

Detailed
performancedata andreportingdisclosures

04

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix42

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Environment
DATA CENTRES

Achieved:

1%
fewer carbon emissions
per cabinet (vs. 2019)8%less water
per cabinet (vs.2019)

2020

2019

2018

Total (tCO2e)1, 5, 6, 10
per occupied cabinet
per £million revenue

2,417
1.7
1.0

2,447
1.7
1.1

5,654
4.0
2.6

Electricity (kWh)Natural Gas (kWh)Diesel (litres)
Fugitives (tonnes)9
Waste (tonnes)
Water (m3)per occupied cabinet

38,995,338
924,396
24,9740.124
5.4
37,54826

39,399,309
1,110,729
29,8750
1441,051
29

38,314,359
1,266,356
15,9440.017
1645,37532

1, 5, 6, 9, 10. Footnotes can be found on page 48

Progress in 2020
In 2020 we achieved significant decreases in emissions
associated from diesel and natural gas (-18% and -17%
respectively). We continued to purchase 100% renewableelectricity, therefore reducing the emissions associatedwith our data centres to only those related to fuels andrefrigerants. Electricity consumption decreased by 1%
and natural gas consumption decreased by 17% comparedto the previous year. The reductions in natural gas
consumption are due to reduced need for space heating
for employee comfort. Lighting upgrades to more
efficient LEDs slowed in 2020 with about half of thewattage saving installed compared to 2019. A larger
decrease in diesel would have been observed if it had
not been for the UPS (Uninterruptable Power Supply)
upgrade programme being undertaken at our primary
UK data centre which necessitates the usage of thediesel stand-by generators. Power supply issues werealso present in Sri Lanka during June, which required
on-site diesel generator use.

What we can improve
A significant increase in Scope 1 emissions was observedin 2020 because of a coolant leak at our primary UK data
centre (equivalent to 220 tCO2e emissions). Data centre
energy consumption and related emissions have notbeen materially impacted by the pandemic, providing
comparable performance to 2019. While there is a clear
trend in a reduction of water usage per cabinet (-8%compared to 2019), measurement of water efficiencies
can be improved to reflect utilisation rather thanphysical cabinet space. Utilisation across data centres
continues to grow, whilst the number of cabinets
remains relatively constant.

2021 focus
During 2021, we will begin a programmeof consolidation of our European data centres
into a new facility and utilise more cloud storage.
This should improve efficiencies in our energy
consumption, and support reductions in emissions.

43

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Environment continued
OFFICES

Achieved:

19%
reduction in carbon emissions
per FTE (vs.2019)91%
less water
per FTE (vs.2019)

Total (tCO2e)1, 5, 6, 10
per FTEper £million revenue
Electricity (kWh)Natural Gas (kWh)
LPG (tonnes)
Diesel (litres)
Fugitives (tonnes)9Company leased fleet Diesel (litres)
Waste (tonnes)
Water (m3)
Per FTE

2020

2019

2018

2,981
0.5
1.2

3,407
0.6
1.5

7,360
1.4
3.4

14,775,667
9,893,901
1.9
18,6340.067
13,115436
21,533
3.7

21,557,927
9,823,669
9.7
89,9580.087
13,560808
57,026
10.5

21,794,074
8,669,881
9.5
40,2180.013
20,135857
48,4309.1

1, 5, 6, 9, 10. Footnotes can be found on page 48

Progress in 2020
Our offices’ environmental performance in 2020 has
been highly affected by the pandemic, so comparisonsto previous years are hard to make. Total emissions
reduced by 5% compared to 2019, with most of the
reduction explained by reduced diesel consumption.
Electricity use across our offices reduced by 31%, andwater by 62% compared to 2019, almost all explainedby lower office occupancy during national and regional
lockdowns. LPG consumption significantly reduced
compared to 2019, as this is only used in one of our
Sri Lankan office’s catering facilities which wereclosed due to the pandemic for most of 2020.
A range of energy efficiency activities took place during2020 but the full impact of these initiatives will not berealised until the offices are again fully occupied.
The most significant improvement was replacing the
HVAC system in the Malabe office with a more energy
efficient chiller. LED lighting replacement initiatives
have continued in Sri Lanka, Italy and the UK.

During 2020, with the support of our on-site property team,
we identified a historic error in reporting of natural gas at
our largest Italian office site – the largest single contributor
to our Scope 1 emissions. The issue has now been rectified,with the support of the landlord, and we have corrected
our disclosure for Scope 1 emissions and consumption
for 2019 and 2018 to ensure consistent reporting.
What we can improve
Natural gas usage increased by 1% compared to theprevious year, which shows the seasonality of pandemic
restrictions as most of our offices using natural gas wereat normal occupancy levels during January to early March.
It also allowed us to identify where improvements in controls
are required, to better adjust our energy consumption
to the varying occupancy levels of our offices.

2021 focus
As occupancy in our offices increases with the lifting ofrestrictions, energy efficiency activities will restart andaccurate monitoring of these initiatives will be key toseeing a return on investment. We are planning
replacement of refrigerant gases used in some of ourexisting equipment, with lower global-warming-potential
alternatives to ensure these are in keeping with ourenvironmental targets. The integration with Refinitiv will
necessitate office consolidation across the combined
portfolio. A key focus of this initiative will be environmental
performance of our buildings. In our response to thepandemic, we have a developed a model to support our
new hybrid way of working – either from home, the office,or another location. This model will require a redesignof some of our real estate portfolio and the creation of
Activity Based Working environments), and all employees
will be affected through greater adoption of homeworking and desk sharing. The environmental
performance impacts of our new ways of working will be
important to monitor.

44

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Environment continued
BUSINESS TRAVEL

Achieved:

74%
fewer businesstravel emissions (vs. 2019)

Total (tCO2e)6per FTEper £million revenue
Total Air Travel tCO2e12
Total Air Travel (km)Total Rail Travel tCO2e12
Total Rail Travel (km)Taxis, Ground Transfers and Hotels tCO2e

2020

2019

2018

4,671
0.8
1.9

18,221
3.4
7.9

18,256
3.5
8.6

4,484
12,433,933
3.1
369,192
184

17,66950,295,918
13
1,254,963
539

18,22747,527,008
30
1,277,664
NA4

4, 6, 12. Footnotes can be found on page 48

Progress in 2020
Business travel has been severely limited due topandemic-related restrictions around the world. Resultsfrom 2020 indicate that business travel was broadly
similar to 2019 levels for the first two months of the year,
before travel restrictions stopped all but a small numberof essential trips. Absolute emissions from air travel
reduced by 75% compared to 2019, and rail travel
showed a similar reduction of 76%. While theserestrictions continue into 2021, we expect our options totravel will increase in the latter part of the year. The
forced reduction in travel has provided an opportunity to
expand our use of digital teams and video conferencing
facilities to all staff members and we hope to capitaliseon these improvements to help drive down a significant
portion of our GHG footprint.
During 2020, we expanded our Scope 3 inventory toinclude all relevant emission sources in order to prepare
our science-based target. This work included improving
our disclosures of air and rail travel to include upstream,or Well-To-Tank (WTT), emissions as well as radiative
forcing uplift for air travel. We also disclose for the firsttime emissions related to Hotels, Taxis and Ground
Transfers. We will be working to improve the accuracy
and coverage of this data during 2021.

What we can improve
Given the huge reduction in travel associated with the
pandemic and government restrictions, 2020 and 2021
are likely to be the lowest levels of business travel
related emissions as options to travel begin to increaseagain in the future. The opportunity, and challenge, is tonow build on this forced change in behaviour to achievea step change in the business approach to travel and toembrace the opportunities for virtual meetings, online
events, and video conferencing. The main source ofemissions are long haul flights, particularly whentravelling business class, which are more carbon
intensive per kilometre travelled than other haul types.
Travel related to integration with Refinitiv is anticipatedthis year once restrictions are lifted. It will be critical tomanage travel carefully during 2021, to keep us on trackwith our Net Zero Climate Strategy.

2021 focus
As part of our strategy to meet our science-based target,business travel will be the primary means by whichemissions reductions can be made against our 2019baseline year. Business travel will need to reduce byapproximately 5% (compared to 2019) every year until
2030, and therefore it is important we carefully manage
the return to air travel as restrictions lift during 2021.
Business divisions will be responsible for managing
employees’ use of travel, encouraging reductions in
numbers of trips and switching to less carbon intensivemeans of travel. Our sustainability and travel teams will
support this change with analysis and regular reporting.

45

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Environment continued
WASTE

Achieved:

50%
less waste produced
per FTE (vs. 2019)2%less waste produced
per FTE (vs. 2019)

Progress in 2020
Waste generated from operations reduced by 46%
compared to 2019, because of reduced site occupancy
during 2020. While waste tonnage reduced, emissions
associated with waste increased by 721% compared
to 2019 due to significantly more waste being reported
as landfill. Early in 2020, we conducted a waste audit
including locations where we must extrapolate waste
production (due to lack of available data in shared buildings).
This confirmed that waste was most likely to be sent
to landfill, rather than recycling or energy from waste
facilities at these offices. It is important to note that 2019and 2018 waste emissions have been restated, to avoid
double counting (see pages 47–48 for more information).
Recycling waste is closely linked with office occupancy
and as such has reduced in line with fewer staff on site.
Similarly, food waste is mainly related to our on-site
canteens that saw closures for significant portionsof the year due to the pandemic.

Total waste (tonnes)
per FTEper £million revenue
Total waste for energy (tonnes)
Total waste recycled (tonnes)
Landfill avoidance
Total (tCO2e)6per FTEper £million revenue

2020

2019

2018

442
0.08
0.18

822
0.15
0.36

874
0.16
0.41

54.9
70.2
28.3%
148
0.025
0.061

538
271
98.5%
18.0
0.003
0.008

644
228
99.8%
18.5
0.004
0.009

6. Footnotes can be found on page 48

What we can improve
Waste treatment at our smaller locations, or those where
we do not have sufficient data, are harder for us to influence
as we typically share the building with other occupants.
However, we will be exploring options for where we canget better information from some sites in terms of waste,
and ensure recycling is an option for all colleagues
globally. This year Defra (our source for waste treatment
carbon intensity) significantly increased the GHG emissions
associated with landfilled commercial waste (increase of359%), due to their use of more recent data on the actual
composition of landfilled waste in their emission factor
calculation. This accuracy improvement provides additional
impetus to secure better waste treatment services.

2021 focus
As site occupancy increases, waste from staff needs
to be properly sorted. With a projected increase in single
use plastics in the short term due to reduced handlingand likelihood of spreading infection, our availabilityof recycling bins and food waste collections will need
to be sufficient and it will be important that as muchwaste as possible is diverted from landfill. Waste
disposal infrastructure will be a focus of ourwaste management efforts during 2021.

46

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Environment continued
METHODOLOGYAND VERIFICATION

We report all the emission sources required under theCompanies Act 2006 (Strategic Report and Directors’
Reports) Regulations 2013. These sources fall within
our consolidated financial statements. We do not have
responsibility for any emission sources that are notincluded in our consolidated financial statements.
Our emissions are calculated in alignment with GHG
Protocol Corporate Accounting and Reporting Standard(revised edition) and UK Government Environmental
Reporting Guidelines: Including streamlined energy andcarbon reporting guidance (March 2019).
LSEG uses an ‘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.
This approach accounts for 100% of emissions fromfacilities, operations and vehicles (whether leasedor owned) over which LSEG has operational control.
It excludes client-based workers; home-based workers are
now included in our working from home emissions estimate.

LSEG’s Scope 1, 2 and 3 emissions disclosed here
and in our Annual Report have been externally verified
by SGS against the requirements of the WRI/WBCSD
GHG Protocol, GHG Protocol Corporate Accounting
and Reporting Standard (revised edition), GHG Protocol
Scope 2 Guidance: An amendment to the GHG Protocol
Corporate Standard and the GHG Protocol Corporate
Value Chain (Scope 3) Standard. Conduct of theverification met the requirements of ISO 14064-3:2006.
Verification statements are available on our website.

The tables and charts included summarise our relevant
environmental disclosure based on Streamlined Energy
and Carbon Reporting (SECR), CDP, GRI and FTSE
Russell ESG indicators. Supporting the call for more
effective climate-related financial disclosures to inform
longer-term investment decision, in June 2017 LSEG
signed a statement of support for the recommendationsof the TCFD framework established by the Financial
Stability Board. Our TCFD disclosures can be foundon pages 56–57 of this report.

2020

201911

201811% Change

Total
UK

66,910,236
42,132,213
640
0
9,466
19,765,509
1,964
0
2,756
1,683,485
14
0359
3,329,029
52
0
1,699

75,667,753
45,548,356
518
0
11,16621,481,944
1,922
0
3,529
2,690,579
22
0
645
5,946,875
271
0
2,710

73,767,993
45,772,365
399
1,831
12,44019,523,202
1,713
1,849
3,276
2,919,307
21
777
777
5,553,119
138
2,675
2,675

-12%
-8%
24%
0%
-15%
-8%
2%
0%
-22%
-37%
-35%
0%
-44%
-44%
-81%
0%
-37%

EuropeAmericas

APAC

Energy Consumption (kWh)Energy Consumption (kWh)Scope 1
Scope 2 – Market Based
Scope 2 – Location Based
Energy Consumption (kWh)Scope 1
Scope 2 – Market Based
Scope 2 – Location Based
Energy Consumption (kWh)Scope 1
Scope 2 – Market Based
Scope 2 – Location Based
Energy Consumption (kWh)Scope 1
Scope 2 – Market Based
Scope 2 – Location Based

Table 1 – LSEG UK energy consumption and emissions13, 14 compared to rest of Group
11. 13, 14. Footnotes can be found on page 48

47

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Environment continued

Rebased numbers
Table

MetricOverall
Performance

Total(tCO2e)1, 5, 6, 8, 10

METHODOLOGYAND VERIFICATIONCONTINUED

Data Centres

Offices

Being a responsible business

Appendix

Reported numbers

2019

2018

2019

2018

+/-2019

150,983

31,492

10,604

17,864

1324%

27.8
65.3

6.1
14.8

2
4.6

3.4
8.4

1290%
1320%

2,734
148,249

2,271
22,089

1,816
8,788

1,414
9,319

51%
1587%

Purchased
goods andservices
Fuel andenergy-related
activities
Waste
generated
Water
Business travel

123,224

NA

NA

NA

3,230

3,778

NA

NA

18

19

302

234

-94%

36
18,221

35
18,257

NA
8,013

NA
8,522

127%

EmployeecommutingHome working
Upstreamleased assets
Total(tCO2e)1, 5, 6, 8, 10

3,440

NA

NA

NA

NA
80

NA
NA

NA
NA

NA
NA

2,447

5,654

282

3395

768%

per occupiedcabinetper £million
revenue
Fugitives(tonnes)9
Waste (tonnes)
Total(tCO2e)1, 5, 6, 8, 10

1.7

4

0.2

2.39

750%

67% Inclusion of fugitive emissions in Data Centre/Office sub-reports
as of 2020. Inclusion of Scope 3 Fuel and Energy Related emissions.
Inclusion of waste and water tCO2e in sub-report total.
67%

1.1

2.6

0.1

1.6

1000%

63%

0

0

NA

NA

14
3,407

16
7,360

NA
1,337

NA
5,559

155%

0.6
1.5

1.4
3.4

0.3
0.6

1.1
2.6

100%
150%

Inclusion of fugitive emissions in Data Centre/Office sub-reports as of
2020.
Inclusion of waste in Data Centre/Office sub-reports as of 2020.
32% Inclusion of fugitive emissions in Data Centre/Office sub-reports
as of 2020. Inclusion of Scope 3 Fuel and Energy Related emissions.
Inclusion of waste and water tCO2e in sub-report total. Natural Gas
reporting error identified and fixed during 2020.
27%
31%

9,823,669

8,669,881

5,315,666

4,428,881

85%

96% Natural Gas reporting error identified and fixed during 2020.

per FTEper £million
revenue
Scope 2, 9
Scope 34

Table 2 – Restatement of emissions
and activity data that have been changed in2020 vs. 2019 Sustainability Report disclosures.

1, 2, 4, 5, 6, 8, 9, 10. Footnotes can be found on page 48

Enabling and supporting positive change

per FTEper £million
revenue
Natural Gas(kWh)+/-2018 Comment
76% Inclusion of radiative forcing uplift for Air Travel, accuracy
improvements to business travel, emission factor change for waste
to avoid double-counting error correction for Scope 1 emissions.
2019 only expansion of Scope 3 to all relevant emission sources.
79%
76%
61% Natural Gas reporting error identified and fixed during 2020.
137% Inclusion of radiative forcing uplift for Air Travel, accuracy
improvements to business travel, emission factor change forwaste to avoid double-counting. 2019 only, expansion of Scope 3
to all relevant emission sources.
Not reported until 2020.

Only Purchased Electricity T&D reported previously,
included in Total Scope 3 emissions.
-92% Emission factor for Waste changed to use only Waste Disposal,
not Material Use, in order to avoid double counting.
Not reported as Group total until 2020.
114% Inclusion of radiative forcing uplift for Air Travel, accuracy
improvements to business travel. In addition expansion to
include Hotels, Taxis and Ground Transfers in 2020.
Not reported until 2020.
Not reported until 2020.
Not reported until 2020.

48

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Environment continued

Rebased numbers

Reported numbers

Being a responsible business

Table

Metric

2019

2018

2019

2018

Fugitives(tonnes)9Company
leased fleet
Diesel (litres)
Waste (tonnes)
Total (tCO2e)6

0.087

0.013

NA

NA

13,56020,135NANA

808
18,221857
18,256

NA
8,013

NA
8,522

127%

3.4
7.9

3.5
8.6

1.5
3.5

1.6
4

127%
126%

17,66918,227

8,002

8,497

121%

50,295,918 47,527,008 50,298,670 47,353,780

0%115% Inclusion of radiative forcing uplift for Air Travel, accuracy
improvements to business travel. Inclusion of upstream Well-To-Tank
emissions for Air Travel.
0% Air Travel journeys reporting error identified and fixed during 2020.

TravelTable 2 continued – Restatement of emissions
and activity data that have been changed in2020 v.s. 2019 Sustainability Report disclosures.

per FTEper £million
revenue
Total Air TraveltCO2e12

Waste

Total Air Travel(km)
Total Rail TraveltCO2e12
Total Rail Travel(km)
Taxis, Ground
Transfers andHotels tCO2e
Total (tCO2e)6per FTEper £million
revenue+/-2019

Appendix

Offices
continued

METHODOLOGYAND VERIFICATIONCONTINUED

Table 2 – Restatement of emissions and activity data that have beenchanged in 2020 (because of inventory rebase) versus 2019
Sustainability Report disclosures
1.	All Group totals and electricity breakdowns use market-based Scope
2 emissions factors, unless otherwise stated.
2.	Scope 1 Emissions Combustion of fuel and operation of facilities –includes Natural Gas, Diesel, LPG, Fugitive Emissions and Fleet Vehicles.
3.	Scope 2 Emissions Purchase of electricity by the Group for its own use(the Group does not purchase heat, steam or cooling). Market-based
emissions use supplier-based emission factors and energy attributecertificates for where 100% renewable supplier tariffs are not in place.
Residual mix factors are excluded due to the entire group electricity
consumption being covered by 100% renewable tariffs or energy
attribute certificates.
4.	Scope 3 includes emissions from Purchased goods and services,
Fuel-and-Energy Related Emissions, Air Travel, Rail Travel, Taxis,
Hotels and Ground Transfers, Waste, Water, Employee Commuting

Enabling and supporting positive change+/-2018 Comment
Inclusion of fugitive emissions in Data Centre/Office sub-reports as of2020.
Reported as TCO2e in 2019.
Inclusion of waste in Data Centre/Office sub-reports as of 2020.
114% Inclusion of radiative forcing uplift for Air Travel, accuracy
improvements to business travel. In addition expansion to
include Hotels, Taxis and Ground Transfers in 2019.
119%
115%

13

30

11

25

18%

20% Inclusion of upstream Well-To-Tank emissions for Rail Travel.

1,254,963

1,277,664

1,443,758

1,410,599-13%-9% Rail Travel journeys reporting error identified and fixed during 2020.

539

NA

NA

NA

18

18.5

302

234

-94%

0.003
0.008

0.004
0.009

0.06
0.13

0.04
0.11

-95%
-94%

	(including home working) and Upstream leased asset. Emissions fromPurchased goods and services, Taxis, Hotels and Ground transfers,
Employee Commuting and Upstream leased assets have only been
calculated as of 2019. Homeworking was calculated for the first time
during 2020, as a result of the Covid-19 pandemic.
5.	Group Carbon Footprint includes tenant consumption. Detailed Officeand Data Centre subsections exclude tenants.
6.	Defra UK Government GHG Conversion Factors are used for our UK
sites, and all business travel, water, waste, upstream leased assets
and extrapolated data. US EPA factors are used for United Stateselectricity and employee commute factors. Local GHG Protocol
emissions factors are used to calculate Scope 1, 2 and Scope 3 fueland-energy-related emissions for international sites where available.
Defra IO factors have been adjusted to reflect reporting year
consumer index pricing to estimate emissions related to purchased
goods and services. US and UK National Travel Surveys have beenused to inform our estimations for employee commuting. Emissions
related to working from home have been based on EcoAct’s“Homeworking emissions whitepaper” (2020).

Not reported until 2020.

-92% Use waste disposal emission factor only (removal of material use)
for waste reporting, as material use counted within Purchased Goods
and Services as of 2020.
-90%
-92%

7.	69% of our total electricity consumption is via 100% direct renewablesupplier tariffs. Energy attribute certificates have been purchased toclaim renewable electricity consumption for all sites where 100%
renewable supplier tariffs are not in place. These certificates havebeen sourced from an internationally recognised trader who is an IETA
member and gold partner of CDP.
8.	Total estimated or extrapolated activity data 5.1%.
9.	Only four sites are able to provide Fugitive emissions data fromsuppliers. All other sites excluded.
10.	Office and Data Centre Total CO2e includes Scope 1, 2 and Scope 3
property related emissions (waste, water and fuel-and-energy-related).
11.	2019 and 2018 total carbon emissions (and associated intensity
metrics) have been updated to reflect changes made to our
methodology in reporting air and rail travel emissions during 2020
(inclusion of radiative forcing and upstream well-to-tank (WTT)
emissions, as well as improvements in accuracy in seat class
information). We have also corrected our waste emission factors toreport only waste disposal emissions. Procurement of goods iscovered by Scope 3 Category 1 Purchased Goods and Services.

12.	Air travel and Rail travel emissions (CO2e) now include radiative
forcing uplift and upstream well-to-tank (WTT) emissions.
This has been applied consistently from 2018 to 2020.
13.	Electricity, Natural Gas, Diesel, LPG, and Fleet Vehicle fuel haveeach been converted from their respective units to MWh in order
to be presented as an aggregate fuel consumption value. Defra
GHG Conversion Factors 2020 (Fuel Properties) have been usedas the basis for this conversion. Refrigerant consumption is notincluded in total MWh.
14.	Scope 3 emissions are not reported separated by UK and Rest ofGroup. Streamlined Energy and Carbon Reporting requires only
Scope 1 and Scope 2 emissions and associated energy usage to be
separated by region
15.	Science-based carbon reduction target applies to Scope 1, Scope 2
and Scope 3 Business Travel (inc Business Travel upstream well-totank emissions) emissions only. Our Supplier engagement target
addresses 57% of our total Scope 3 emissions, stating ourcommitment that 66% of our suppliers by emissions set a sciencebased target by 2025.

49

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

SocialBeing a responsible business

Appendix

2020 Group statistics1,2
Disclosure
Employment
by region

By contract type

Health and safety9
Training and education

1.	Figures as of year-end 31 December 2020
2.	Due to rounding, some totals may not correspondwith the sum of the separate figures
3.	LSEG office in Romania opened in 2018
4.	Mix of employees and Non-Executive Directors
5.	Executive Committee and Leadership Teams in LSEG
6.	The LSEG Subsidiary Board members and the Executive
Committee and Leadership Teams together comprise the‘Senior Managers’ for the purposes of section 414C (8)(ii)of the Companies Act 2006
7.	Total comprises Executive Committee and Leadership
Teams and All other colleagues
8.	Not a required disclosure
9.	100% of total LSEG workforce is represented in formal joint
management worker health and safety committees
10.	Figures may not total 100% due to individuals who havechosen not to disclose this information

Enabling and supporting positive change

Indicator
United Kingdom
Sri Lanka
Italy
United States of America
Malaysia
Romania3
FranceTaiwanOther
Total
Full TimePart 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

Labour standards
Disclosure
Indicator
Diversity and equal opportunity10
United Kingdom
Sri Lanka
Italy
United States of America
Malaysia
Romania3
FranceTaiwan
Other
Total
Disclosure
Indicator
Group by gender and organisational level
LSEG plc Board
LSEG Subsidiary Boards4,6
Executive Committee and Leadership Teams5,6All other colleagues
Total7

Disclosure
Indicator9
Employees by age group Under 30 years
30 – 50 years
Over 50 years
Total
Nationalities represented in the Group8
Non-discrimination
Total number of incidents of discrimination and actions taken

2020
1,962

%
35

2019
1,705

%
34

2018
1,666

%
36

1,319
698
699
191
271
210
90
126
5,566
5,354
56
156
5,566
16%
6.0%
1
100%
82,993
0

24
13
13
3
5
4
2
2
100
96
1
3
100

1,127
683
676
199
193
192
80
126
4,981
4,810
64
107
4,981
18%
10.5%
0
100%
74,770
0

22
14
13
4
4
4
2
3
100
97
1
2
100

1,001
669
667
189
68
167
30
130
4,587
4,397
78
112
4,587
18%
11.0%
0
100%
63,150
0

22
15
15
4
1
4
0
3
100
96
2
2
100

Female
33
30
35
34
68
33
34
52
45
35
Female
4
28
172
1,750
1,922
2020
1,397
3,340
827
5,566
84
0

2020 %
Male
67
70
64
66
33
67
61
48
55
65
2020
Male
5
110
298
3,334
3,632
%
25
60
15

Female
33
29
36
33
66
33
34
53
44
35
Female
4
31
140
1,577
1,717
2019
1,291
2,983
707
4,981
81
0

2019 %
Male
67
71
64
67
34
67
58
47
66
65
2019
Male
9
132
219
2,957
3,248
%
26
60
14

Female
33
28
36
35
65
29
39
43
41
34
Female
3
22
134
1,453
1,569
2018
1,361
2,641
585
4,587
80
0

2018 %
Male
67
72
64
65
35
71
61
57
59
66
2018
Male
10
116
295
2,723
3,018
%
30
57
13

50

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance
SUSTAINABILITY RISK
Findings of Scenario Analysis and Heatmap Exercise
Following he selection of the four scenarios, (seepage 36), a key risks and opportunities heatmap
was developed using qualitative data from the business.
The heatmap was quantitatively validated throughthe use of publicly available data aligned withscenarios and timeframes selected, highlighting
key risks and opportunities across multiple LSEG
geographies and business units:
Physical Risks to Operations – the greatest changes
to physical risk for LSEG’s operations as of 2020 are
in the UK, Italy, Malaysia and Sri Lanka driven by a highvalue at risk (exposure) and in Malaysia and Sri Lanka
driven by a greater change in the physical risk ofextreme weather events.
Transition Risks to Operations – The greatest risk
to operations is assessed to be within the UK and Italy.
This is driven by a risk of more stringent policies suchas carbon prices being introduced across the world withthe transition to net zero. However, given that LSEG’semissions are relatively small, this will have less of an
impact on LSEG operations relative to potential impacts
in other areas of the business.
The physical and transition risks to our Operations willchange over time as LSEG’s property portfolio evolves.
Transition Risks to Business Units – Capital markets andInformation Services were assessed to be the two most
exposed business units to climate risk which are strongly
driven by the policy & legal and reputational risk factors.
Transition Opportunities to Business Units – A veryclear picture emerged from this assessment, withinformation services clearly experiencing the greatest
opportunity closely followed by capital markets.

Findings of Quantification Modelling Exercise:
Building on the Climate risk scenario analysis
and heatmap validation work, the Group developed
preliminary quantification models to facilitate therisk assessment of climate-related risks. The twomodels developed cover Physical Risks for Operations
and Transition Risks for one of the Group’s business
units. The Operations model has focused on threemain pathways:• the impact of climate events on our operations andresultant foregone revenue,• the business disruption and repair costs for uninsurable
buildings and equipment,• the rising insurance costs
The associated preliminary output of the quantificationof the financial risk for our Operations ranges between
the probable values of £395,000 and £690,000 of likelihoodweighted annual costs over the next 10 to 30 years.
We will use and further expand the new Climate Change
Physical Risk quantification model to inform Operations’future strategic decisions and footprint planification.
Further, we plan to build on the Climate Change
Transition Risk quantification model and apply it toother Business Units as well as to the overall Group.
Social and Governance risks
Cultivating a diverse talent pool and an inclusive culture
is a key focus for the Group to ensure we reflect thesocieties we serve. Further, ensuring the health andsafety of staff during the existing global Covid-19
pandemic has been a key priority over the past 12
months with Business Continuity measures in placeacross all offices. The Group has mobilised greater
resources to support the wellbeing of staff with newdevelopments including the creation of Mental HealthChampions across the Group and additional
engagement surveys on the new “Ways of Working”.
Further details can be found in LSEG’s Annual Reportunder HR Risks. Last, Cyber is another sustainability risk
we continuously consider as a Group, especially froma governance perspective, and is fully documented
under the Principal Risk section of our Annual Report.

Significance and relevanceof climate-impact
No

VL

L

M

H

VH

Risk/
Opportunity
area

Risk/Opportunity
sub areas

Transition

Policy and legal risk

Physical

Opportunity

Operations

Business Functions
Information
services

Post Tradeservices LCH

Capitalmarkets

Technology
services

M 1

M

L

H 5

Market and economy risk

VL

M 3

L

M 3

L

Technology risk

M 1

L

L

L

L

Reputational risk

VL

M 6

M 6

M 6

M 6

Acute physical risk

H 2

VL

L

VL

VL

Chronic physical risk

M 2

VL

L

VL

VL

Resource efficiency

M

VL

L

VL

VL

Energy efficiency

M

VL

L

VL

VL

Product and service
efficiency

No

H 4

L

H 4

L

Market opportunity

No

L

L

M 7

L

1 Medium transition risk to theoperations of the businesswith stronger carbon
regulations and greater
technology risk such asenergy efficiency measures.
2 Physical risk is most material
at an operational level
but will have knock-on
impacts for each of thebusiness functions.

3 Medium market risks
to capital markets andinformation services given
trends towards a greaterclimate focused risk
or investors switching
benchmark if LSEG doesn’t
have the capability or
ambition to include a climate
aspect on the benchmark.

4 The most material
opportunities exist within
information services where
there are opportunities todevelop low carbon indexes
and capital markets business
units where there areopportunities to promote
green products.

L

5 High regulatory risk tocapital markets as greater
disclose requirements may
discourage companies
from listing altogether.
6 Reputational risk is relevant
at a Group level andtherefore impacts all
business units.
7 Market opportunities
to capitalise on new
structure of businesswithin the economy.

51

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
UN SSE: COMMUNICATION TO STAKEHOLDERS
Having joined the UN-backed Sustainable Stock Exchanges (SSE) 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 sixth report on progress.

BUSINESS STRATEGY
1. 	How does your exchange define and viewthe rationale for corporate sustainability
and the exchange’s role in promoting it?

Our CEO’s message, sustainability strategy and Materiality review on pages 3,5 and 9 respectively, demonstrates our rationale for corporate sustainability
and our role in promoting it.

2. 	How does your exchange’s senior leadershipand organisational structure support the promotionof corporate sustainability in its market(s)?

Our sustainability strategy is developed and reviewed by our Executive Committee and Board respectively, while our organisational structure is set out on page 35.
We support the promotion of sustainability across capital markets globally, see pages 13–20.

3. 	 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, Grow and Transition – please see Our supporting and enabling positivechange section for more details (see pages 13–20). We set out our specific objectives for 2021 in our Looking ahead section on page 7.

TRANSPARENCY AND ISSUER REPORTING
4. 	Describe your exchange’s approach to promoting
sustainability disclosure by companies.

We encourage best practice disclosure in three ways. Firstly, during 2016 we developed guidance on ESG disclosure for issuers of all sizes across the UK and Italy, which
was first launched in February 2017 and whose latest edition can be accessed at www.lseg.com/esg. Secondly, FTSE Russell’s ESG assessment methodology Reinforced
the leading global ESG reporting standards including GRI, SASB and CDP. In 2019, London Stock Exchange Group launched the ESG disclosure score for its London-listedcompanies (see page 17). Thirdly, we promote issuer-investor dialogue on ESG issues through capital markets events.
In July 2020 Borsa Italiana held its fourth Sustainability Day – this year a virtual Sustainability Week, due to the Covid-19 pandemic – to encourage investor-issuer dialogue
on ESG issues. More than 600 one-to-one meetings took place (see page 17). 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 Task Force on Climate-related Financial Disclosures (TCFD). In 2020, London Stock
Exchange Group – in collaboration with the Sustainable Stock Exchanges Initiative and the former Governor of the Bank of England and now UN Climate Envoy Mark Carney– convened an advisory group to develop model guidance for stock exchanges on climate-related disclosures, to be launched in 2021 ahead of COP26 (see page 17).

5.	What is your exchange’s process for reviewing
listing standards in general? Are there opportunities
for stakeholders 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 as set
in the Rules of the Markets, organised and managed by Borsa Italiana. Any modification to the Rules is subject to two main approvals: Borsa Italiana’s Board 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 Rulesof the Markets and their implementing Instructions. For example, as part of its preparation of the modifications, Borsa Italiana shall consult relevant stakeholders, such as theindustry associations of issuers and intermediaries, in order to incorporate their comments and suggestions.

6.	How do you track sustainability reporting of yourlisted companies?

Starting from 2019, the main tool to track sustainability reporting will be the ESG disclosure score based on FTSE Russell ESG assessment methodology. The ESG disclosure
score was awarded to London listed companies in October 2019 (see page 17). The 2020 report on the ESG disclosure score of LSE listed companies was publishedin November (see page 17).

52

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
TRANSPARENCY AND ISSUER REPORTING CONTINUED
7.	What incentives (i.e. public recognition/awards)
and sanctions do you have in place to encourage
disclosure and discourage 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 to construct the FTSE ESG Index Series, which highlight companies that meet good practice standards, and the Environmental Markets and Green Revenues Index Series.
FTSE Russell also works with other exchanges across the world.

8. What connections have you made between
national sustainable development frameworks
and goals, and your exchange’s existing Standard
and norms?

LSEG ESG reporting guidance builds on national disclosure standards and norms across the UK and Italy. The EU Non-Financial Reporting Directive was transposedin 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 Financial Stability Board’s Task Force on Climate-related Financial Disclosures and theSustainable Development Goals (SDGs). In 2018, Borsa Italiana joined the Technical Expert Group on Sustainable Finance set up by the European Commission to provide
advice on a number of initiatives included in the EU Action Plan on Financing Sustainable Growth. In particular, Borsa Italiana has been involved in the activities of the TEG
sub-group focusing on climate-related disclosures, tasked with incorporating the TCFD recommendations into the Non-Binding Guidelines complementing the Non-Financial
Reporting Directive, and the sub-group focused on the EU Classification System for sustainable activities ( EU Taxonomy). London Stock Exchange Group in 2020
was a member of the FCA/PRA Climate Risk Forum, which published four reports on the integration of climate considerations in the financial sector.

More information can be found on pages 18–19.

In December 2020, the FCA announced that climate-related disclosures will be mandatory for certain listed companies from 2021, with gradual extension to all listedcompanies over time.

ISSUER CAPACITY BUILDING
9. If your exchange offers sustainability guidance forcompanies, please provide a description of theprocess for its creation.

LSEG involved market participants in the creation of its ESG Guidance for issuers thorough investor and issuer workshops organised in the UK and Italy, and consulted
other stakeholders (standard setters and responsible investment NGOs) before finalising the guidance. In 2019, London Stock Exchange held a consultation on theevolution of its Sustainable Debt Markets.

10. Do you and/or your regulator provide guidanceon externally assuring ESG disclosures? In yourmarket, how common is external assuranceof 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 “Investment Grade Data” chapter of the guidance).

53

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
COLLABORATION AND ENGAGEMENT
11. 	Who does your exchange view as its key
stakeholders and how does it engage
and collaborate (or plan to do so) withthese and potentially other stakeholders?

We do this in a range of ways including:• we partner with 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, and LSEG in 2020 was involved in the PRA/FCA Climate Financial Risk Forum (see page 39)• 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, Forum per la Finanza
Sostenibile (ITA SIF) Euro SIF, Japan SIF, RIA Canada and RIAA
• through our involvement with the SSE initiative and the World Federation of Exchanges, in 2020, LSEG was part of the Advisory Group that developed guidance on thedevelopment of ESG derivatives, and convened a UN SSE Advisory Group on climate-related disclosures (see above and page 39)• we are working in a range of ways to support the growth and development of green finance: London Stock Exchange Group and Borsa Italiana are partners of the Climate
Bonds Initiative, and London Stock Exchange in 2019 joined ICMA’s Green Bond Principles and Social Bond Principles Advisory Council• in 2020 Borsa Italiana was a member of the EFRAG project task force tasked with providing the European Commission with technical advice on the creation of an EU
non-financial reporting standard

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

LSEG’s Global Sustainable Investment Centre aims to promote green and sustainable capital raising and deep integration of ESG consideration in the investment processacross 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 guidance. In 2020, London Stock Exchange’s Green Economy Mark,
recognising issuers with more than 50% of their revenues deriving from the green economy as defined based on FTSE Russell Green Revenue data model (see page. 15),
was awarded to 92 companies.

EXCHANGE NEEDS
13. 	Are there any specific resources that you would
like from the SSE or other relevant groups tohelp you in your sustainability work?

The agenda of the SSE has already moved beyond disclosure, also addressing green finance and the role of regulators. 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.

14. 	Are there any specific requests you have ofinvestors, issuers and regulators in terms of theirrole 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
disclosure that issuers perceive how investors are shifting capital allocations in response to ESG and low-carbon economy considerations. Therefore we’ll keep placingemphasis on the importance of investor-issuer dialogue on ESG issues, as a complement to high-quality ESG data flows. LSEG welcomes the recommendations of the
Financial Stability Board Task Force on Climate-related Financial Disclosures as a key development in the trend.

54

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
FTSE RUSSELL QUANTITATIVE ESG DATA POINTS AS REFERENCED IN THE LSEG ESG REPORTING GUIDANCE
Indicator

Indicator
sub code

Indicator description wording

2020

2019

2018

Environmental

ECC14

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

ECC15
ERP18

Total energy consumption data is disclosed
Disclosure of NOX emissions (tonnes)

2,670 tCO2e
66,910 MWh

2,734 tCO2e
75,668 MWh

9,403 tCO2e
73,768 MWh

Not significant

Not significant

Not significant

EPR19

Disclosure of SOX emissions (tonnes)

Not significant

Not significant

Not significant

EPR21

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

Not significant

Not significant

Not significant

EPR24

Disclosure of hazardous waste generation (tonnes)

Not significant

Not significant

Not significant

EPR25

Disclosure of non-recycled waste generation (tonnes)

371 tonnes

551 tonnes

646 tonnes

EPR26

Disclosure of waste recycled (tonnes)

70 tonnes

271 tonnes

228 tonnes

EPR27

Total costs of environmental fines and penalties during financial year

0

0

0

EPR28

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

47%

47%

47%

ESC30

Total GHG emissions data on properties disclosed

5,503 tCO2e

6,014 tCO2e

13,234 tCO2e

ESC31

Total energy usage data on properties disclosed

66,910 MWh

75,668 MWh

73,768 MWh

ESC32

Total water usage data from property portfolio disclosed

62,856 m3

103,970 m3

101,478 m3

EWT11

Total water use/water extraction data is disclosed

62,856 m3

103,970 m3

101,478 m3

EWT12

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

Not significant

GAC12Disclosure of total amount of political contributions made5

GAC13Disclosure of number of staff disciplined or dismissed due to non-compliance with anti-corruption policies

0

0

0

GAC14

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

0

0

0

SHR17

Total amount of corporate or group donations/community investments made to registered not-for-profit organisations£4.9 million1£1.7 million2£1.5 million3

SHS12

Percentage of sites with OHSAS 18001 certification

0%

0%

0%

SHS13

Number of staff trained on health and safety standards within the last year4

100%

100%

100%

SHS38

Number of work-related employee fatalities

0

0

0
0

GovernanceSocialNot significant
Not significant
The only political donations The only political donationsThe only political donations
made in 2020 amounted
made in 2019 amounted made in 2018 amounted
to US$14,000 donated to
to US$29,000 donated to to US$19,000 donated topolitical organisations bypolitical organisations by political organisations by
the LSEG US Holdco, Inc.
the LSEG US Holdco, Inc. the LSEG US Holdco, Inc.
employee operated PAC
employee operated PAC. employee operated PAC.

SHS40

Number of work-related contractor fatalities

0

0

SLS24

Full-time staff voluntary turnover rates

6.0%

10.5%

11.0%

SLS25

Percentage of employees that are contractors or temporary staff

3%

2%

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) 82,993b) 15a) 74,770b) 15a) 63,150b) 14

1.	This is the total cash charitable donation made by the Group in 2020, consisting of £1,764,000 to LSEG Foundation and £3,937,000 to other charities
2.	This is the total cash charitable donation made by the Group in 2019, consisting of £1,616,000 to LSEG Foundation and £103,000 to other charities
3.	This is the total cash charitable donation made by the Group in 2018, consisting of £1,254,000 to LSEG Foundation and £207,000 to other charities

4.	100% of new staff received health and safety training
5.	All LSEG US Holdco, Inc. contributions will be reviewed for legal compliance and will be publicly reported in accordance with US election laws

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
SUSTAINABLE DEVELOPMENT GOALSAs the UN Sustainable Stock Exchanges initiative
assesses that exchanges are well placed to havea measurable impact on five of the Sustainable
Development Goals (SDGs), we align our strategy
to them. This is also one of the frameworks
recommended in our ESG Reporting Guidance.

SDG

Goal

Associated targets

LSEG impact

Gender equality

Ensure women’s full and effective participation and equal opportunities for leadershipat all levels of decision-making in political, economic, and public life.

Develop
SustainDecent work and economic growth

Promote development-oriented policies that support productive activities, decent job
creation, entrepreneurship, creativity and innovation, and encourage the formationand growth of micro, small and medium-sized enterprises, including through accessto 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
Transition
ConveneClimate action

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

Disclose
Transition
ConveneSustain

Partnerships for the 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56

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
Task Force on Climate-related Financial Disclosures (TCFD)
In 2020, LSEG has taken further steps, facilitated and supported by an independent and external consultancy, to define and model how climate change impacts our businesses and operations. To further align with the TCFD
recommendations, the Group has undertaken scenario analysis and quantification modelling over both the medium and longer term (2035 and 2050), and how these may impact operational and market risks. The aim is toreinforce the Group’s resilience to physical risks now and in the future; to address transition risks and opportunities; be prepared for potential future mandatory reporting requirements; and to protect the Group’s reputation.
The associated preliminary output of the quantification of the financial risk for our Operations ranges between the probable values of £395,000 and £690,000 of likelihood-weighted annual costs over the next 10 to 30 years.
TCFD recommended disclosures
Governancea. Information on LSEG’s governancearound climate-related risks andopportunities: Board’s oversightb. Information on LSEG’s governancearound climate-related risks andopportunities: Management’s role

Strategya. Climate-related risks and opportunities
identified over the short, medium
and long term:b. Impacts of climate-related risks andopportunities on
LSEG’s business, strategy andfinancial planningc. Resilience of the organization’s strategy
based on scenario analysis

LSEG Approach2020 Enhancements

References• LSEG Board has oversight of the Group Sustainability Policy,
which includes our Environmental Policy;• The Group CEO sponsors the Group Sustainability Policy at Board level• The Group COO reports to the Board on environmental matters• Board Risk Committee presented with clearly identified
non-financial risk framework as part of Group ERM,
including climate-related risks• Group Sustainability Policy• LSEG Sustainability Report 2020: Environment
section, pages 22–25 and 42–48• Risk section of the Annual Report, pages 24–39• LSEG Sustainability Report 2020, Governancesection, page 35• LSEG Annual Report 2020, Supporting Sustainable
Growth section, pages 54–67• Group Sustainability Committee is chaired by Executive Committee member • There are two dimensions to our sustainability strategy.
• The EMG is responsible for setting Group-wide targets, and managing
Our first pillar is described as “Transforming the global
and seeking to improve our environmental performancefinancial eco-system” this is about how we work acrossthe market to support the shift to a net-zero sustainableeconomy. Our second pillar is described as “Transforming
our operations and culture while supporting the wider
community” – this includes our people, our communities
and our environmental impacts• There is a Group approach on climate-related risks and is reported through • The Group is developing climate-related risk quantification• LSEG Sustainability Report 2020 : Environment
The Group Sustainability Committee – The process is managed by Risk
models over both the medium and longer term to help identify section,pages 22–25 and 42–48
and has been supported by an independent external consultancy, to define
how physical and transition risks may impact our business• FTSE Russell Green Revenues data modeland model how climate change impacts our businesses and operations• Strategy section of the Annual Report, pages 14–23• For scenario analysis, see risk section of the
Sustainability Report, pages 36 and 50• LSEG Annual Report 2020, Supporting Sustainable• Our EMG guides the Group’s environmental strategy, and is responsible• Group Risk has worked with an independent external
Growth, pages 54–67
for setting Group-wide targets, managing and seeking to improve ourconsultancy to develop a Climate risk and opportunities
environmental performanceheatmap and a preliminary quantitative methodology inorder to quantify the financial impact on LSEG’s businessand support and inform future investment and business’
decision making.
• We have been working on developing quantification models to
identify the most material physical and transition risks for the business,
including our operations• Climate Change risks and opportunities qualitativeand quantitative heatmaps completed• Preliminary quantification models completed for Operations
and one business unit

57

London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
TCFD recommended disclosures

LSEG Approach2020 Enhancements

References

Risk managementa. Information on LSEG’s processes for:identifying and assessing climaterelated risks• Some climate-related risks have been categorised as emerging risks
and it is acknowledged that they are inherently linked to other strategic,
financial and operational risks• Training was delivered to Risk champions to enableeffective identification and assessment of ESG risks,
including climate-related risks• Review of climate-related risks in the Group Risk database• The Group has developed climate-related risk scenarios
over both the medium and longer term

• LSEG 2020 CDP Response: Risk and Opportunities
Section, questions C2.1–C2.3• LSEG Annual Report: Principal risks and uncertainties
emerging risks section, page 39• LSEG Annual Report, Supporting Sustainable Growth,
pages 54–67

b. Information on LSEG’s processes for:managing climate-related risks• LSEG has taken steps to develop its methodology to define andmodel how climate change impact its businesses. The aim is toreinforce the Group’s resilience.
• The Group Sustainability Committee is the governance body that provides
direction to the Group, incorporating strategic input from the Executive
Committee, to which the Group Sustainability Committee reports. Risk
function also reports and seeks input and approval on climate risk workfrom the Sustainability Committee.

• Developed preliminary quantification models forOperations and one of the Group’s business units• On-going interaction with Operations around footprint
and climate exposurec. Information on LSEG’s processes for:how climate-related risks
are integrated into LSEG ERM system• LSEG continues to increase its’ focus on embedding these risks in our
ERM framework and some climate-related risks have been categorised as
emerging risks and it is acknowledged that they are inherently linked toother strategic, financial and operational risks

Metrics and targets
a. Metrics and targets used by LSEG
to assess and manage: relevant climaterelated risks and opportunities• Our business divisions are developing more established approaches
to get more exposure of our markets to the green economy• Physical risk metrics are associated with LSEG environmental
programme targets• Climate Risk and Opportunities Quantification models
and ongoing refinement to drive future strategic
decision-making

b. Metrics and targets used by LSEG toassess and manage: Scope 1, 2 and 3
GHG emissions• LSEG has measured and disclosed these emissions for many years
and has incrementally improved its calculation of this data

• We have made improvements to how we calculate
our Scope 3 emissions including radiative forcing
in travel emissions

c. Metrics and targets used by LSEG
to assess and manage: Targets
and performance• LSEG sets environmental targets for business operations for reports
against these targets externally on an annual basis• We have set a science-based target approved by the
Science Based Targets Initiative (SBTi), which ensures ouremissions reduction target meets with the changes needed
to keep global warming below 1.5°C compared to preindustrial levels• LSEG Sustainability Report 2020: Environment section,
pages 22–25 and 42–48• FTSE Russell Report “The green economy report: How
issuers are leading the drive to a low-carbon economy”
16 July 2020
• LSEG Annual Report 2020, Supporting Sustainable
Growth, pages 54–67• FTSE Russell Report “Investing in the green economy –sizing the opportunity” 16 December 2020

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
WFE PRINCIPLES
Having joined the World Federation of Exchanges (WFE)
in 2018, LSEG has committed to take on a leadershiprole in promoting the sustainable finance agenda.
Below we summarise our efforts to promote thePrinciples progressively in accordance with ourcircumstances and priorities.

Principle

Principles in action

Principle 1
Exchanges will work to educate participantsin the exchange ecosystem about the importanceof sustainability issues• Borsa Italiana held a virtual Sustainability event to raise awareness among market participants
and facilitate dialogue between issuers and investors on ESG and sustainability topics• London Stock Exchange launched its Sustainable Bond Market Advisory Group (SBMAG), a forum
for market participants to provide input on London Stock Exchange’s Sustainable Bond Market

Principle 2
Exchanges will promote the enhanced availabilityof investor-relevant, decision-useful ESG information• We have introduced mandatory annual post-issuance reporting requirements for issuerson Sustainable Bond Market• London Stock Exchange has produced a guidance report on Green FinancePrinciple 3
Exchanges will actively engage with stakeholders
to advance the sustainable finance agenda• Our stakeholder engagement is outlined in this report on page 39

Principle 4
Exchanges will provide markets and productsthat support the scaling-up of sustainable financeand reorientation of financial flows• FTSE Russell launched its Climate EGBI
• London Stock Exchange AIM market celebrated its 25th anniversary in 2020
• In March 2020, London Stock Exchange was the first exchange globally to announce that it would
be admitting social and sustainability bonds with use of proceeds aligned towards mitigating the impact
of Covid-19 with no admission fees on its Sustainable Bond Market (SBM)

Principle 5
Exchanges will establish effective internal governanceand operational processes and policies to support
their sustainability efforts• We continue to assess the materiality of ESG and related risks to LSEG and to increasingly integratethese considerations into our Enterprise-wide Risk Management framework• A description of our sustainability governance can be found in this report on page 35

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
SUSTAINABILITY ACCOUNTING STANDARDS BOARD (SASB)
As an advocate for greater transparency, LSEG is committed to providing meaningful sustainability information to our stakeholders.
We continue to enhance our sustainability reporting, beginning our first ever disclosure aligned to the SASB framework.
The table below summarises LSEG’s current SASB alignment.

Table 1.
Sustainability
Disclosure
Topics &Accounting
Metrics

TOPIC

CODE

INDICATORDETAILS

PromotingTransparent& Efficient
CapitalMarkets

FN-EX-410a.1(1) Number and (2) average duration of (a) halts
related to public release of information and (b)pauses related to volatility

No volatility reported following release of information

Managing
Conflicts ofInterest

FN-EX-410a.2 Percentage of trades generated from automatedtrading systems2

As a provider of execution services and associated platform connectivity infrastructure, the entire process is considered electronic by definition,utilising various forms of automated strategies and processes. If we define this as the monthly averages by value traded by proprietary trading
firms directly accessing the London Stock Exchange order book in their own capacity as member firms, then over the course of 2020 this varied
between 29% and 32%.

FN-EX-410a.3

Description of alert policy regarding timing andnature of public release of information

We do not provide any advice to our clients about the content or timing of their disclosures. All responsibility for content and timing rests with theclient.

FN-EX-410a.4

Description of policy to encourage or require listed
We actively support evolving global ESG reporting standards and our own reporting strives to reflect the high standards we advocate. We provide
companies to publicly disclose environmental, social, tools and insights to help our issuers understand the importance of, and best practice in, ESG disclosure.
and governance (ESG) information
Examples include:• Provision of FTSE Russell ESG Ratings to issuers via LSEG Issuer Services platform, with sector benchmarks• Provision of a proprietary ESG Disclosure Score to issuers via LSEG Issuer Services platform, with sector benchmarks, to indicate the %of material data points being disclosed• Provision of an online tool for issuers outside the FTSE Russell research universe to calculate an ESG Disclosure Score• ESG Disclosure Guidance for Issuers publication• Annual report on ESG Disclosure Score performance trends to celebrate best practice• Regular webinars from LSEG experts and industry specialists on the importance of ESG disclosure, covering regions and sectors• Creation of the Green Economy Mark to incentivise disclosure of Green Revenues. Annual report of Green Revenues trends and performance• Direct engagement with issuers on market development and regulatory trends in ESG and climate disclosure

FN-EX-510a.1

Total amount of monetary losses as a result of legal
proceedings associated with fraud, insider trading,anti-trust, anti-competitive behaviour, market
manipulation, malpractice, or other related financial
industry laws or regulations

FN-EX-510a.2 Discussion of processes for identifying andassessing conflicts of interest

LSEG did not sustain any monetary losses in the reporting period as a result of legal proceedings associated with fraud, insider trading, anti-trust,anti-competitive behaviour, market manipulation, malpractice, or other related financial industry laws or regulations.

LSEG plc maintains a Group Conflicts of Interest Policy (the Policy) which is subject to annual review.
The Policy:• provides guidance to assist in the identification of both personal and business conflicts;• sets out the requirement to clearly identify all conflicts and, if possible, take appropriate steps to avoid them;• where conflicts cannot be avoided, mandates that they be disclosed or recorded and effectively managed to mitigate any associated riskthat a Group entity or employee might be, or perceived to be, unduly influenced as a result of their existence.
Mandatory Conflicts training is provided to all employees annually to ensure the provisions set out in the Policy are communicated, reinforced
and understood. To confirm their comprehension of the training, all employees must pass a test before being considered to have successfullycompleted the course. Any non-completion is subject to escalation to the Executive Committee.

2.	Footnotes can be found on page 48

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London Stock Exchange Group plc
Group Sustainability Report 2020

Introduction

Our Sustainability Strategy

Enabling and supporting positive change

Being a responsible business

Appendix

Governance continued
SUSTAINABILITY ACCOUNTING STANDARDS BOARD (SASB) CONTINUED
TOPIC

CODE

INDICATORDETAILS

Table 1.
Sustainability
Disclosure
Topics &Accounting
Metrics
continued

Managing
Business
Continuity &Technology
Risks

FN-EX-550a.1(1) Number of significant market disruptions and (2)duration of downtime4

There was no downtime of the Trading platforms in 2020

Table 2.
Activity
Metrics

Averagedaily numberof trades
executed, by
product or
asset

FN-EX-550a.2 (1) Number of data breaches, (2) percentage
involving personally identifiable information (PII), (3)number of customers affected5

In 2020, LSEG did not record any loss of PII or data where customers were directly impacted

FN-EX-550a.3 Description of efforts to prevent technology errors,
security breaches, and market disruptions

LSEG aims to proactively detect and/or prevent technology errors and security breaches to minimise the risk of disruption to the businessand safeguard data. LSEG has established layers of defences to mitigate against security breaches; ranging from protecting the externally facing
perimeter to defending the internal network. Our Global Security Operations Centre constantly monitors 24 hours, 7 days a week x 365 daysa year, rapidly responding to security alerts.

FN-EX-000.A

Average daily number of trades executed:
UK order book:
1,070,450
Italian order book:
391,071
Derivatives – Equity & Commodity:
98,472Retail Bonds:
15,671MTS Cash:
2,399
MTS Repo:
4,071
EuroTLX:6,445
Turquoise Integrated:
414,816
Turquoise Plato™:
64,2924, 5. Footnotes can be found on page 48

Average daily number of trades executed, by
product or asset class© March 2021
London Stock Exchange Group plc
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