Leeds Building Society became the first national high street financial institution to receive the Fair Tax Mark in December 2018, and was reaccredited in July 2019. We took the opportunity to speak to Luke Wellock, Corporate Responsibility Manager at Leeds Building Society, and asked him about their experience of the accreditation process, why the Society applied for the Fair Tax Mark and how it’s benefitted the business so far.
Luke, why did Leeds Building Society apply for the Fair Tax Mark?
Our members and colleagues influence much of the Society’s responsible business activity and research carried out by our Insight team revealed that transparency was a very important topic to our membership.
Tax is one of the most scrutinised aspects of transparency, coming up repeatedly as the public’s number one concern about how businesses conduct themselves. It was also an area we felt we should lead on in the financial services sector.
Paying our fair share of tax was nothing new for us – as a mutual, we were founded on the principle of people helping people. It is one of the main ways we contribute to society and it funds the vital public services our members and colleagues all rely on. So, as a successful and profitable business, paying our way is important. The official accreditation was a great opportunity to demonstrate our commitment to doing things the right way.
How did you find the process of gaining the Mark?
Many of the processes already in place within the business around our accounting and tax affairs met the standard needed for accreditation, so we used these as the starting point to build on. The feedback from the Fair Tax team helped us make further improvements, particularly around developing a tax policy that articulated our commitment publicly, to ensure our tax affairs comply with the spirit, as well as the letter, of the law.
What did your business learn from going through the process?
We knew tax transparency was an important issue for our members and the wider public. However, one of our key learnings is the strength of feeling people have when it comes to talking about tax fairness and in turn how this has the capacity to build trust in financial services.
To learn more we surveyed our online member panel and I’ve outlined some of the key findings here:
- 96% of respondents said payment of the fair amount of tax is integral to being a responsible business
- 93% of those surveyed said financial services business should have to publicly disclose how much tax they pay in the UK
- 89% said all financial services organisations should commit to not using tax havens or tax avoidance practices
- 79% said they would trust an organisation with the Fair Tax Mark more than one without the accreditation
- 79% said they would consider switching their account if they discovered their provider was not paying their fair share of tax
What are the benefits for you of having the Fair Tax Mark?
The benefits of the Fair Tax Mark are significant and varied. It:
- helps build trust with new customers;
- is a positive indication of our commitment to communities;
- demonstrates our corporate values to prospective and existing colleagues;
- illustrates our commitment to ethical business practices;
- is a point of differentiation in financial services, where public trust is particularly important;
- delivers positive media coverage reporting us as an industry-leader in this area.
What would you say other businesses could gain by securing the Mark?
As well as the benefits outlined above, businesses achieving the Fair Tax Mark will join a growing number of organisations that are a force for positive change in this area.
The public feeling around tax transparency is already heightened and I can only see awareness of this issue growing. Companies that aren’t playing fairly may soon find themselves out of step with what society expects of them.
How should businesses start the process of achieving the Fair Tax Mark?
- Listen to the public: Earlier this month our members told us being transparent in how we do business was really important; 96% of respondents said payment of the fair amount of tax is integral to being a responsible business.
- Be open to feedback: we asked the Fair Tax Mark to understand what we needed to do – we’d always paid our tax in the spirit of the law but their advice on how we could be more open led to one of our first actions, publishing our tax strategy on our website.
- Get teams working together: our Board of Directors was committed from the start and our Finance and Corporate Responsibility teams worked together to make our tax reporting clearer.
- Plan ahead: the process isn’t onerous, but asks questions businesses may not have front and centre in their planning. We started building changes into our Report and Accounts process in anticipation of applying for the Fair Tax Mark.
- Be transparent: tax avoidance has shown itself to have a damaging impact on trust in business. Therefore, now more than ever, it’s important for those who are proud to pay their tax to step up.
Why does Leeds Building Society believe tax matters?
We think it’s time we started to talk about the contribution made to society through tax and the importance of businesses paying it fairly.
It’s hard to imagine any business would be successful without all the things tax funds, such as quality education, healthcare and transport, and its important businesses consider this when deciding how they structure their tax affairs.