Embracing Change: Alliance Data’s 2018 Sustainability Progress

Change is not new, it’s merely the new norm. Within our 2018 Sustainability Report you’ll see that Alliance Data is embracing change by rethinking, re-strategizing and creating shared value for our associates, clients, investors, communities and other key stakeholders. Our approach to Environmental, Social and Governance (ESG) matters illustrates our commitment to ensuring we are well-positioned for the future. In today’s shifting business environment, we must continue to invest in practices that meet or exceed stakeholder expectations, effectively manage risk and enable us to focus on long-term growth and sustainability.

Good corporate governance is defined by transparency, integrity and accountability. We know that in order to stay competitive and relevant in a dynamic business environment, our Company’s strategy must remain focused on these core attributes, as well as the evolving priorities of our stakeholders. We operate in a way that serves the diverse interests of our shareholders as well as those of our associates, suppliers, clients, consumers, and the communities in which we operate.

Alliance Data is far from alone in this thinking. In his 2019 Letter to CEOs, BlackRock CEO Larry Fink wrote, “…every company needs a framework to navigate this difficult landscape, and that it must begin with a clear embodiment of your company’s purpose in your business model and corporate strategy. Purpose is not a mere tagline or marketing campaign; it is a company’s fundamental reason for being – what it does every day to create value for its stakeholders. Purpose is not the sole pursuit of profits but the animating force for achieving them.”

Mr. Fink and many other prominent members of the financial and investment community are also responding to the “rise of ESG investing.” The movement is predicated on expectations that businesses today are increasingly measured on their responsible operating practices and how those practices are embedded in the business strategy. Specific criteria are used by both retail and institutional investors to assess risk and evaluate financial performance against their investment goals. Shareholder engagement on this matter is at an all-time high, and Alliance Data is committed to advancing our ESG disclosures in an effort to meet the expectations of transparency from this important stakeholder group.

Proven practices that drive our success (2018 supporting metrics):

• Driving a mandate of ethical behavior throughout the entire organization as the foundation for our behaviors and every decision that we make
  • 85% Percent of associates that believe their manager treat associates with respect and dignity
• Maintaining an independent board committed to effective oversight and risk management through sound corporate governance
  • 89% Board independence 
• Adhering to responsible banking practices, safeguarding data and protecting consumer privacy
  • 42M active cardholder accounts, 0 data breaches
• Actively cultivating an inclusive work environment where our diverse associate population can thrive and their contributions are recognized and valued
  •  35% Women in leadership roles 
• Ensuring that our community investments deliver positive, measurable outcomes that tie back to our business strategy
  • $16.5M Community investment

These “non-financial” essentials are integrated into how stakeholders evaluate Alliance Data. Establishing trust and credibility are critical, which is why we’ve worked diligently to build a comprehensive annual sustainability report that provides an in-depth look at how we manage and advance our organizational activities. New this year, our standalone ESG Performance Scorecard makes it easier for rating firms to assess benchmarks and progress across significant business categories. This quantitative, data-focused approach to how we measure and report performance further underscores our commitment to respond to stakeholders’ expectations with respect to accountability and transparency.

Alliance Data has been recognized for its good practices by several notable organizations, including the FORTUNE “100 Best Companies to Work For,” the FTSE4Good Index Series and Forbes’ “Best Employers for Diversity” list. These recognitions validate the investments we have made in our people and our communities. Since 2008, the company increased its annual financial investment in communities worldwide by more than 65 times, contributing $16.5 million in 2018 alone. As we invest in our communities, I was not surprised that for the third consecutive year, 85 percent of our associates indicated their belief that Alliance Data makes the communities where we operate better places to live and work.

We at Alliance Data will continue to listen, respond, empower and use data for good to drive sustainable success for our company and all our valued stakeholders. Through our 2018 Sustainability Report, I welcome you to see how we are embracing change while adhering to our core tenets of operating ethically, with purpose and transparency.