FINANCIAL STATEMENTS
STRATEGIC REPORT
GOVERNANCE
I am pleased to introduce Just Group plc’s 2021 Annual Report. Our focus in this period shifted to sustainably growing the business after we successfully completed the programme to strengthen our capital position in 2020. Before commenting on the Company’s performance, on behalf of the Board I would like to express our gratitude to Keith Nicholson who retired from the Board at the end of December. Keith was Senior Independent Director of Just Group since its creation, and was part of a team that steered our Group through significant regulatory change. He has provided me with wise counsel, for which I am grateful and he takes with him our best wishes for the future. OUR PRIORITY IN 2021 The primary focus of our Group in 2021 has been to capture profitable growth opportunities. There are strong structural drivers of growth which make our markets very attractive, including demographics and the appetite of company directors and pension trustees to transfer the risk of operating defined benefit pension schemes to insurance companies. The segments of the market we choose to operate in are growing, which enables us to be selective in the risks we take on, whilst still enabling our Group to achieve double-digit levels of profitable and sustainable growth. In 2020 we successfully completed the programme to strengthen our capital position and the Board remains content with our position. We have continued with our management actions to reduce our exposure to UK house price movements by selling a portfolio of lifetime mortgages. During the year we made good progress with the Prudential Regulation Authority (“PRA”), receiving approval to make changes to the Group’s Solvency II internal capital model. The UK government is seeking to conclude its Future Regulatory Framework (“FRF”) Review to deliver the vision for the sector set out by the Chancellor in his Mansion House speech in July 2021. We are hopeful that the FRF will deliver opportunities for Just Group to increase our investment in the UK economy to drive productivity and contribute to our net zero commitments. The Group’s financial strength and performance is explained in detail in the Business Review. DIVIDEND Having met our commitment to strengthen the Group’s capital position by attaining capital self-sufficiency and delivering positive organic capital generation, and following a strong financial operating performance the Board proposes restarting dividends and recommends a final dividend of 1.0 pence per share. BOARD COMPOSITION AND GOVERNANCE Following Keith Nicholson’s retirement, I am pleased that Ian Cormack has taken up the role of Senior Independent Director and that Kalpana Shah will now Chair the Group Risk and Compliance Committee. Mary Kerrigan was appointed a Director of the Group on 1 February 2022. Mary is already, and will continue to be, a Non-Executive Director of Just’s subsidiary life companies, and is Chair of the Investment Committees. John Perks joined the Group on 1 April and became Non-Executive Chair of the Group’s subsidiary life companies in May, following the decision by Nick Poyntz-Wright to step down. I’d like to thank Nick for his service to the Group over his six year tenure and his diligent work in ensuring that the policyholders’ expectations of the insurance products are met. Kathy Byrne was appointed as a Non-Executive Director of the Group’s subsidiary life companies on 1 February 2022 and joined the Investment Committees. You can read more about the Directors of the Company on page 68.
I take great pride in leading the Board and the Group’s governance function, and my introduction to the Corporate Governance Report on page 66 provides further information on our governance and decision making processes. I would like to thank the entire Board for their significant contribution, and look forward to working with them in 2022. CONTRIBUTING TO A MORE SUSTAINABLE FUTURE We have an important role in helping the world transition towards a sustainable environment and low carbon global economy. We announced a number of new carbon net zero commitments, which builds on the excellent progress already made to reduce the carbon intensity of our business. We’ve also incorporated a new section into this year’s report to provide a better understanding of climate-related risks and opportunities. Our disclosures are consistent with those recommended by the Taskforce on Climate-related Financial Disclosures and you can read more on pages 22 to 29. I was delighted that Just became the first European insurance company to launch a Sustainability Bond. This follows our pioneering launch of the first Green Bond by a UK insurance company in October 2020. You can read more about this on page 18. Growing the Just way is a theme our colleagues across the Company want to be active in shaping and the Board has received input from our colleagues before approving the Group’s sustainability strategy during this period. We are on an exciting journey as a Company, as an industry, as a country and as individuals. You can read more about our sustainability strategy on page 20 and at justgroupplc.co.uk . ENGAGEMENT WITH OUR STAKEHOLDERS The Board engages directly and indirectly with our customers, shareholders, colleagues, regulators, legislators, professional bodies and wider society to promote the interests of our customers more broadly. We place great importance on working effectively with these groups and actively seeking their feedback. We work hard to ensure our customers benefit from our services and our shareholders receive the benefit of long-term value creation. Throughout this report you can read how the Board takes into consideration feedback from the Company’s stakeholders and how the Board, and colleagues from across the Group, promote the success of the Company. OUR PURPOSE We are a purpose driven Company with a compelling and credible purpose. Quite simply, we help people achieve a better later life. We achieve this by providing competitive products, services, financial advice and guidance to help our customers achieve security, certainty and provide themwith peace of mind in retirement. Our purpose remains as relevant today as it did all those years ago when we created it. It’s clear, authentic and it acts as a beacon for colleagues across the entire Group to live the purpose every day. Our customers, existing and prospective, are at the heart of everything we do at Just. OUTLOOK The fundamental drivers for growth in our core markets continue to be strong and we have focused our leadership team on driving long-term profitable growth. We have continued to increase the Group's balance sheet resilience by taking actions to reduce our capital sensitivity to residential property exposure. The commercial outlook remains favourable for our Group. On behalf of the Board, I would like to close by thanking all of our colleagues across the Group for their commitment to providing award winning services to our customers and business partners. I’d also like to thank our business partners who have trusted us to provide outstanding service to their clients. We are growing the Just way, delivering profitable and sustainable growth, fulfilling our purpose and helping contribute to a net zero economy. We are increasingly optimistic about the future.
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