A message from our CEO.

David McLean.

COVID-19 is a major threat to our health and economy. It is also a major threat to progress in several other important areas.

In early 2020, climate change was getting more worldwide attention than ever before. By late March, it had tumbled from the front pages and has been mostly absent since. At the same time COVID-19 has increased poverty and inequality.

Hopefully, a vaccine will soon stop COVID-19 in its tracks. However there is no simple solution for climate change, poverty or inequality. These are long-term issues that we need to keep tackling with urgency.

I was encouraged by the words of young environmental leader, Annika Andresen, when asked if she was worried that our COVID-19 response had halted progress in other areas.

“Although climate change has taken a back seat, the idea of being able to see how visibly we can change quite quickly and adapt, and how much we can change our behaviour, has been quite a positive outcome.”

Our challenge as a country is to face into climate change, inequality and social exclusion with the same resilience and energy with which we’ve tackled COVID-19.

That is the approach we’ve tried to take at Westpac NZ and I’m pleased with progress towards our sustainability goals.

You’ll read in this report about our certification as the first carbonzero bank in Aotearoa, our first sustainability-linked loan, our plans to transition all of our vehicle fleet to electricity, and our partnership with responsible spending app, CoGo.

You’ll also read about how we no longer lend to coal mining and how we’ve increased our lending to the green economy to $1.6 billion.

Perhaps the thing I’m most proud of is the launch of Westpac Warm Up, a $10,000 interest-free loan for home heating, insulation and ventilation. This is about making it easier and more affordable for customers to make their home warmer, healthier and more environmentally sustainable.

We’ve also been kept on our toes. In May and July, we had systems outages that affected our customers’ ability to transact and access their accounts. That’s not good enough. As a result, we have dedicated significant resources to fixing these issues.

We’re also seeing an increasing trend, sped up by COVID-19, for customers to bank remotely through online banking and our contact centre. But there are still customers that want or need to visit our branches, so we are working hard to find solutions that meet everyone’s needs. We’ll also be putting cheque users at the centre of our thinking as we migrate them to other forms of payment in the coming year.

The low-interest environment we’re currently in also presents challenges. How do we offer good value to savers? How do we support first home buyers as they negotiate an uncertain housing market? COVID-19 will reshape our economy so we need to ask ourselves how we support all of our customers as we all grapple with the new financial outlook.

We’re deeply indebted to our Sustainability Advisory Panel for their guidance, oversight, challenge and scrutiny. We also want to hear from you, the public, on how we can serve our customers and the country better.

COVID-19 has given us the chance to look at new ways to create a healthier environment, economy and society. This will be at the heart of our next 2025 Sustainability Strategy, which we will unveil early next year. We believe businesses should help solve big problems and bring resources and a different lens to the challenges we face. Our commitment is manaaki te ao, manaaki te tāngata, e tipu pūtea ora - take action on climate change, support our people and communities and help lift financial wellbeing.

Noho ora mai

David McLean

Chief Executive Officer, Westpac New Zealand

Adj David Mc Lean 2020 HR 11