Our People

Reward and recognition

Overall, we have taken a conservative approach to remuneration levels and we have differentiated reward for our high performing colleagues through a number of performance measures, including the management of risk and other balanced scorecard objectives.

For 2008 bonus awards, we have worked with the UKFI, (the body responsible for the government’s shareholdings in UK banks) to undertake a review of our bonus arrangements. We are also undertaking an ongoing review for 2009.

Overall, through aligning reward to our balanced scorecard, our aim is to recognise performance against factors including how well our colleagues manage risk and therefore the long term health of the business. We have structured our reward arrangements with this in mind. We will continue to differentiate our reward for colleagues who fulfil our commitment to building relationships for the long-term.

Total reward

We take a broader view on reward than financial benefits and our 2008 flexible benefits scheme enabled colleagues to select from a range of non-cash benefits including medical and life-assurance, additional pension, education vouchers, matched learning and childcare vouchers. In 2008, 68 per cent of colleagues participated in the scheme. In addition, in 2008, over 95 per cent of colleagues opted to participate in one of our various employee share plans. The vast majority of our colleagues are therefore shareholders and have a vested interest in our long term success.

During 2009, we will undertake a full review of our approach to total reward as part of the integration of Lloyds TSB and HBOS.

Recognition

While our emphasis is on providing recognition through line management, we also formally recognise those who have exceeded expectations and pushed boundaries in areas such as colleague support, customer service and building community profile. One example of this is through our ‘Making a Difference’ awards, which in 2008 recognised the contribution of over 180 colleagues who made exceptional contributions to the business and the community last year.