Providing 'more' means creating value for our stakeholders. We actively engage with our different stakeholder groups in order to understand what matters most to them.

Identifying who our stakeholders are and engaging to understand what matters to them enables us to provide more for the North West and create long-term value for all.

We do not operate in isolation and it is not for us alone to determine what the region needs us to deliver. This is why it is essential we engage with stakeholders across the North West, so we can identify shared solutions to shared challenges. We value the diverse perspectives that a broad range of stakeholders, representing different and often competing interests, can bring to our decision-making.

Understanding what matters to stakeholders will only be achieved by building strong, constructive relationships and engaging regularly. These relationships are subject to robust governance to ensure the insights generated are taken into account in decision-making at executive and board level. Read more on Promoting the success of the company for the benefit of all. This is important to building and maintaining trust. The board's corporate responsibility committee meets four times a year, with stakeholder engagement as one of its standing agenda items, and the chair of the independent customer challenge group (YourVoice) regularly attends board meetings to provide its perspective.

The following pages detail how we engage with, and are influenced by, each of our key stakeholder groups. Our analysis of what matters most to stakeholders, and how these issues affect our ability to create long-term value, is set out in our material issues matrix in Delivering our purpose.

There are nine key stakeholder groups that influence our planning and activities:

Our approach to engagement extends across all of our stakeholders.

What Matters

Engaging our stakeholders


Keeping Cumbrian communities informed of pipeline plans.

From 2022 we will need to stop abstracting water from Ennerdale Water and the River Ehen in West Cumbria to avoid the risk of damage to the protected species that rely on these water sources.

To achieve this, we're linking customers in West Cumbria to our regional water network by building a major new pipeline from Thirlmere.

So far, we've completed the longest-ever tunnel of its type in the UK and completed over a million man hours with no lost time accidents while making sure we work carefully to protect the Lake District National Park.

Putting stakeholders at the heart of this project has resulted in a sector-leading approach to stakeholder management for major water infrastructure in England.

We have worked closely with regulators, stakeholders, local communities and contractors, and this constant dialogue has ensured the highest standard of environmental protection and transparency.

This continuous engagement has helped minimise the impact that construction on this scale inevitably brings to local communities.

Working in partnership with local organisations such as the Cumbria Community Foundation, we established two funds of just over £1 million in total to award financial grants to projects that provide social and environmental benefits to the local area.

These funds will leave a lasting legacy long after the pipeline is finished, benefiting people and communities across Cumbria for years to come.

Generating value for:


Communities


Why we engage

Our work puts us at the heart of local communities: places where customers and employees live and work. We seek to develop strong relationships based on mutual trust, respect and an understanding of the impact our work has on everyday lives. We play a constructive role in tackling issues through engagement and investment, and by identifying what matters most to communities we can develop solutions in partnership.

How we engage

When communities come together, whether that is around a particular issue or location, they can often make powerful representations to the company. Much of this engagement is face to face, although social media and other digital communication is on the increase with online communities such as Watertalk, our online customer research panel.

We engage through facilitated workshops and community partnerships, such as those involving communities affected by the construction of the West Cumbria pipeline. Issues raised by communities can present opportunities to improve what we do to help others, while some can be complex and difficult to handle, especially where competing interests between different stakeholder groups are present, and require time and effort to work through.

Top three material issues

Land management and access

Community investment

Trust, transparency and legitimacy

Customers


Why we engage

Serving over seven million people and 200,000 businesses in the North West means it's important we get our services right. But to deliver a great service in a way that customers value, we need to listen and engage with them in ways that are relevant. We know customer expectations are ever changing, and often more demanding, so we constantly look for ways to engage with, and understand, evolving customer expectations of us as their water company.

How we engage

We are always interested to hear what customers think about us and devote considerable time asking for, receiving and analysing customer feedback. We get this through everyday interactions, online customer panels and more detailed weekly research on key themes that are important to them. We have changed how we communicate and deliver services based on customer feedback, such as the introduction of Priority Services and our Instagram account. Our business plan for 2020–25 was shaped by unprecedented levels of customer engagement.

The independent customer challenge group, YourVoice, aims to ensure customers are at the heart of our business planning, and the Chair regularly attends our board meetings. YourVoice provides challenge and critical support on the delivery of commitments as well as contributing to the shape of future business plans.

Top three material issues

Customer service and operational performance

Affordability and vulnerability

Leakage and water efficiency

Employees


Why we engage

Our employees are the face of the company and we could not deliver our services without them. It is essential we build productive relationships based on trust. We know that the more engaged, skilled and motivated our people are, the better service they provide to our customers, at a lesser cost. In addition to our own employees there are over 13,000 as part of our supply chain in the North West who are essential to our performance.

How we engage

Employees know our business better than anyone, with a diverse range of views and experience, making them well placed to identify opportunities for improvement.

We have a highly-engaged workforce who take pride in their work and value opportunities to learn new skills, and we maintain an open and honest dialogue between trade unions and the business. Line managers play a vital role in supporting employees, with regular one-to-one meetings, and our engagement survey now achieves UK high-performing norms. Our Employee Voice panel consists of 24 members from across the company providing a means by which employee perspectives are heard by the board. We have several employee-led networks such as LGBT and multi-cultural networks, an early careers board and we encourage employees to share innovative ideas via many forums.

Top three material issues

Health, safety and wellbeing

Diverse and skilled workforce

Employee relations

Environment


Why we engage

We rely on the environment and play a key role in protecting and enhancing it across the North West. As the environment has no voice of its own, we engage with interested groups such as environmental regulators, non-governmental organisations, campaigners and local communities to find the best ways to tackle environmental issues, like climate change and reducing plastic pollution. We work with other water companies to collectively make a difference.

How we engage

The environment is one of our key resources so it is important for the sustainability of our business that we protect and enhance it; see Our business model. We conduct facilitated workshops with environmental stakeholders to understand their priorities and have undertaken a large number of customer research projects.

Environmental stakeholders tell us that working together is the best way to ensure resilience in the natural environment, especially where climate change is concerned. We work with environmental partners across the North West to identify new ways to deliver improvements, and engage with several groups to explore opportunities to deliver shared environmental outcomes.

Top three material issues

Resilience

Environmental impacts

Climate change

Investors


Why we engage

It is important that shareholders have confidence in the company and how it is managed, given their investment in our business. We have over 70,000 shareholders, from large institutions who manage the pensions of millions of people to private individuals who are looking for a return on their hard-earned money. So that we can finance improvements to our assets and services, we maintain relationships with a diverse range of banks.

How we engage

Engagement with shareholders gives us a broad insight into their priorities, which is taken into account in our decision-making and our strategic direction. By providing updates on strategy and performance, we can assist them in their understanding and decision-making.

Through our investor relations programme, we actively engage with shareholders and analysts who write research reports on our company and industry. Regular engagement activities are supplemented by ad hoc events, such as the capital markets day held this year on the business plan determination for the 2020–25 period. We supply information to several investor-led indices on environmental, social and governance matters, such as the Dow Jones Sustainability Index.

Top three material issues

Customer service and operational performance

Political and regulatory environment

Financial risk management

Suppliers


Why we engage

Good relationships with suppliers help ensure projects are delivered on time, to good quality, at efficient costs, and can bring innovative approaches and solutions that create shared value. We work with around 2,500 suppliers to deliver our services, and the availability of goods and services in the market influences our strategy and how we operate.

How we engage

We rely on suppliers to deliver our services. We engage suppliers through workshops, including targeted sessions on innovation, and one-to-one feedback. Like-minded suppliers sign up to our sustainable supply chain charter and support the commitments set out within it, such as the commitment on human rights.

Feedback from suppliers revealed it can be difficult to access the company, especially when they have new products and services that could help us be more efficient and deliver better service. We established our Innovation Lab to help address this issue.

Top three material issues

North west regional economy

Responsible supply chain

Human rights

Media


Why we engage

It is through both traditional media and social media platforms that many of our stakeholders receive their information about us and our activities. The media is influenced by the issues that matter to those stakeholders as well as influencing them through what it reports.

How we engage

Given the essential nature of our services, it is important that coverage is fair, balanced and accurate, and this requires effective two-way dialogue between the company and the media. This is achieved through proactive engagement by our media team, which is available 24/7, providing content to media outlets, as well as dedicated resources to drive proactive messaging on social media channels.

Top three material issues

Political and regulatory environment

Leakage and water efficiency

Social media

Politicians


Why we engage

Politicians influence the long-term national water strategy and environmental priorities, matters that affect how all businesses operate, and champion issues raised by their constituents.

How we engage

We undertake direct engagement with national and local government, as well as elected representatives and devolved administrations on topics of public interest, helping us to understand their issues so we can seek solutions to shared environmental, social, economic and governance issues. We engage with regional and national politicians across the different political parties.

Top three material issues

Political and regulatory environment

Leakage and water efficiency

Trust, transparency and legitimacy

Regulators


Why we engage

Through proactive, constructive engagement with economic, quality and environmental regulators, we agree to deliver commitments over specified time frames.

How we engage

We actively engage to shape the policy and regulatory framework within which we operate, covering customer, economic, environmental, social and governance matters. These priorities need to be balanced and viewed over a long-term horizon, and maintaining relationships is key to this. The priorities and objectives of regulators can change over time so active engagement to provide our perspective around future policy is important to us.

We hold regular meetings with all our regulators, including working on joint projects such as Natural Course, which aims to build capacity to protect and improve the north west water environment.

Top three material issues

Political and regulatory environment

Resilience

Trust, transparency and legitimacy

Managing our material issues

Our approach to materiality

Understanding what matters most to our stakeholders is fundamental to being a purpose-driven organisation. We consider these stakeholder priorities alongside our own assessment of what has the biggest impact on the company and its ability to create value, and the output is presented in the material issues matrix below.

This stakeholder materiality assessment informs decisions about what we report in documents such as this Annual Report. Setting out issues in this way helps ensure we understand key stakeholder priorities and consider their interests in strategic decision-making, helping us create long-term value.

In defining the strategic relevance of an issue to the company, we have adopted the integrated reporting framework definition of materiality, which states: "a matter is material if it could substantively affect the organisation's ability to create value in the short, medium or long term". Value, in this context, may be created internally (for the company, investors and employees) and there can be external value (for customers, communities, suppliers and the environment). Value may be financial or non-financial.

Our assessment of the level of interest to stakeholders is based on a balance of views obtained from customers, investors, regulators, communities, and subject matter experts from the company on an ongoing basis, as well as the extensive insights gathered for the regulatory price review process.

We have cross-referenced and aligned these issues with our principal risks and uncertainties, and our approach was reviewed by responsible business consultancy Corporate Citizenship, which commented that "alignment with United Utilities' way of creating value gives life and credibility to the materiality matrix", and this sends a very distinctive message about our business model and what we value.

Material issues matrix

We consolidated feedback from our various stakeholder groups, as detailed above, which resulted in 26 material issues. These issues are impacted by factors that may be external, internal or both; for example, affordability and vulnerability affect customers due to external social and economic factors, and the support services we provide for those customers are an internal factor, so this issue is impacted by both. The 26 issues are plotted on the matrix below, from lower to higher in terms of level of interest to stakeholders and how much it can affect our ability to create value.

External factors

5 Political and regulatory environment

7 Climate change

12 Cyber security

15 NW regional economy

17 Natural resources

21 Social media

24 Land management and access

26 Human rights

Internal factors

2 Resilience

8 Financial risk management

9 Corporate governance and business conduct

11 Innovation

14 Data security

16 Energy use

18 Responsible supply chain

19 Health, safety and wellbeing

22 Employee relations

25 Community investment

Both external and internal factors

1 Trust, transparency and legitimacy

3 Customer service and operational performance

4 Leakage and water effciency

6 Affordability and vulnerability

10 Sewer flooding

13 Environmental impacts

20 Competitive markets

23 Diverse and skilled workforce