Letter from our CEO
How we do things is just as important as what we do
Principal was founded more than 140 years ago with the purpose of putting financial security within reach for more people. As the company has evolved into a global financial partner, our ambitions have followed, but our purpose remains: Fostering a world where financial security is accessible to all.
At Principal, our commitment to our customers, and their expectations of us, extend beyond building a secure financial future, to improving the future of the world we all share. Our business ambitions must be balanced with responsible business practices and a pledge to advance humanity and the planet. This report discusses our ongoing work to become a more sustainable, inclusive, innovative, and responsible organization. These efforts are essential to our continued success—not only because our stakeholders expect them, but also because they are vital to shaping the future of generations to follow.
The hurdles to becoming financially secure are numerous and urgent. They include longer lifespans, shortfalls in retirement savings, gaps in pension funding, and a need for greater financial education. We face environmental threats, including climate change and—as we’ve seen with COVID-19—public health. And around the world, unequal power structures, ongoing racial bias, and other systemic inequalities fuel widespread social unrest.
We must begin to address these challenges today. Change must happen in our homes, our communities, our workplaces, and with our civic and political leaders. Only together can we lead the type of change the world needs—and Principal pledges to be a catalyst for change.
Only together can we lead the type of change the world needs—and Principal pledges to be a catalyst for change.”
ESG Task Force
We’ve taken major steps to strengthen our ESG work this year. Our ESG Task Force, comprised of leaders from across the company, meets monthly to chart the course and ensure alignment with internal goals and third-party standards. Last year we added to that task force, hiring our company’s first Chief Inclusion Officer, who joined Principal in July 2019 and leads our effort to build a diverse workforce and inclusive culture where everyone is heard and respected.
The ESG Task Force guides our work across a myriad of distinct and often-overlapping areas including, but not limited to:
We’re focused on maximizing the impact of our volunteerism, grant-making, and other community-building efforts.
Workforce and talent resources
We strive for greater equity in our human resources processes—the recruitment, retention, and advancement of diverse, world-class talent.
We’re developing products and services that are socially responsible and accessible to people of all careers, backgrounds, beliefs, and income levels.
We are continuing to build sustainability into our business operations and develop more sustainable products and services for our clients.
Brand and experience
We’re identifying new ways to inform, educate, and engage with all potential customers within our key markets, including customers in historically underserved groups.
Our pledge to engage in responsible business practices
We can do more to reach underserved populations—for example, in the U.S., the Hispanic population, the nation’s fastest-growing demographic. Although we outperform many of our industry peers (and in the Fortune 500) at the C-suite and board levels, we share our industry’s challenge of recruiting, retaining, and advancing women and minorities. We can do more to reach people who are self-employed, work part-time, or are otherwise involved in the informal job market (commonly known as the “gig” economy). We are proud to call the state of Iowa our global headquarters—I was born within a short drive of our headquarters—but we need to embrace a more global mindset.
These are just a few examples of how we are balancing our business ambitions with our pledge to responsible business practices. We’re working on it—and we’ll find better ways to fulfill our mission, just as we always have in the past. We will succeed because these core values underlie our efforts:
We have the honor of helping more than 33 million people around the world to save enough, protect enough, and have enough. But we can’t stop there.”
Starting with the customer.
We have the honor of helping more than 33 million people around the world to save enough, protect enough, and have enough. But we can't stop there. We embrace the opportunity to foster meaningful and positive change for our customers, drawing on our financial and investment management expertise to help more people take the steps necessary to achieve financial security. Everything we do from an ESG perspective helps us fulfill our promises to customers—and to all stakeholders.
Doing what’s right
Integrity is non-negotiable at Principal. We believe strongly in the business value of an inclusive, ethical organization. We’re stronger when everyone feels welcomed, respected, and has an opportunity to thrive.
Investing for our future
I mentioned we’ve been in business for more than 140 years. We will be here for at least another 140. We’re making strategic investments in people, partnerships, products, and technology to help make it happen.
Owning what’s next
Technology has brought us closer together as a global community. Even amid the COVID-19 pandemic, when Principal has 95% of our employees working remotely (outside of a traditional office), we have greater opportunity than ever to share wisdom, best practice, and innovation at scale. This enhances our opportunity to serve as educators, advocates, and lobbyists on behalf of individuals, employers, and institutions.
Despite the hurdles to financial security, we see reason for optimism. The global middle class is expanding at an unprecedented rate, placing financial security within reach of millions—if not billions—more people than ever before. Even with the rapid pace, we have the technology that puts our financial products and services at their fingertips. Crucially, our global footprint places us in a strong position to understand and adapt to the changing economic, social, political, and technological landscape.
There’s so much that we’re working toward—more to share about our efforts in 2019, and our aspirations for 2020 and beyond. This report will take you for a deep dive into those topics. Thank you for reading—and we look forward to achieving much more together in years to come.
Principal® Community Relations has a focus to build financial security in communities where Principal Life Insurance Company operates. Insurance products and plan administrative services provided through Principal Life Insurance Co., a member of the Principal Financial Group®, Des Moines, IA 50392.
The Principal Financial Group Foundation, Inc. (the “Principal® Foundation”) is a distinct, not for profit, undertaking separate from the Principal Financial Group, Inc. (“Principal”). The major focus of the Principal Foundation is to build financial security in the communities where Principal operates. The Principal Foundation has $200M assets under management and directs its returns to helping people learn, earn, and save. While the Principal Foundation receives funding from Principal, the Principal Foundation is an independent organization. The Principal Foundation does not practice any form of investment advisory services and is not authorized to do so. The Principal Foundation YouthCan Initiative is a venture of the Principal Foundation and is aligned with the goals and objectives of the Principal Foundation. © 2020 Principal Foundation.