Independent assurance statement

Review of targets and resource data by Bureau Veritas

To the stakeholders of British Land PLC

For the third year, Bureau Veritas has been engaged by the British Land Company PLC (British Land) to conduct an independent review of British Land's targets, Key Performance Indicators (KPIs) and resource use data for the period 1 April 2008 to 31 March 2009.

The overall aim of the review is to assure British Land's stakeholders that: i) the objectives and targets set by the business address the company's material issues; ii) the 'Building Together' strategy is being implemented effectively; and that appropriate processes are in place to accurately report information on progress against targets, KPIs and resource use data.

This Statement applies to the information detailed in the scope of work below and contained in the Corporate Responsibility Report for 2008/09, on the company's website. Bureau Veritas undertook this review in line with the requirements of the AA1000 Assurance Standard (AS 2003).

Scope of work
Bureau Veritas reviewed the following:

Review of progress made on the implementation of the 'Building Together' strategy;
British Land's process for assessing the levels of performance achievement against a sample (24 or 55%) of its 2008/09 targets (all of the performance-based targets). A list of these is available for download on this page;
Review of the stated performance against these targets;
The process by which British Land gathered and reported its resource use data for the period 1 April 2008 to 31 March 2009;
Review of process for collating British Land's London Benchmarking Group 2007/08 submission; and
British Land's process for setting its 2009/10 targets and the suitability of these targets for the year ahead.

Methodology
As part of its review, Bureau Veritas undertook the following activities:

Interviews with British Land Senior Management involved in the development and delivery of its 'Building Together' Strategy;
Interviews with ARUP (consultants) who assist British Land and managing agents in reporting progress against targets and collate the resource use data;
Verification of the systems used in the aggregation and analysis of the resource use data including review of source data provided by two managing agents (Munroe K and Broadgate Estates);
Independent review of the mechanisms for reporting progress and verification of the performance achieved for 24 targets;
Review of selected non resource-related KPI data produced in the CR report. This includes sustainable development, occupiers, suppliers and community KPIs; and
Review of the scope and specific wording of the 2009/10 targets to ensure that they reflect British Land's material issues raised by stakeholders, help manage the company's CR related impacts and promote performance improvement.

Findings and recommendations
Based on our review, it is our opinion that:

British Land has continued to effectively communicate and implement the 'Building Together' strategy across its key stakeholders - including employees and managing agents. Evidence of greater accountability and ownership for CR issues, and CR performance, were identified across operations. We recommend that British Land consider further expanding the implementation of the 'Building Together' strategy to work even more closely with key external stakeholder groups, such as occupiers.
British Land has further developed its methodology for selecting and defining CR targets relating to its key material issues. The 2009/10 targets are generally considered to be SMART (Specific, Achievable, Measurable, Realistic and Time-bound), and reflect British Land's current key material issues. British Land should be commended on setting challenging performance-based targets across its portfolio. We recommend that British Land continues to review on an ongoing basis any changes to its material issues reporting (and therefore target selection) to reflect changes in key stakeholder expectations relating to the current economic climate. For example, targets which provide increased emphasis on customer satisfaction, lease agreements and refurbishment activity.
Based on the sample review of 24 targets, the % levels of performance achieved and the description of progress are considered to be an accurate reflection of the activities and programmes carried out by the organisation during the relevant period. British Land should be commended on the improvements it has implemented in the process for collecting and reporting information from managing agents (for example, creation of Action Plans for large properties and regular performance reviews with managing agents and ARUP). We recommend that any good practice activities are reported across managing agents and that this process could be adapted and extended to smaller properties, such as retail parks;
The resource and non-resource use KPI data reviewed accurately reflects the data reported and managed by ARUP at a central level. Further, British Land has continued to improve the processes for collecting and reporting resource and non-resource use data. This includes, for example, more formalised mechanisms for collecting waste information. We recommend that British Land further develops and reviews the effective implementation of, the guidance for reporting resource use data provided to managing agents, particularly in light of planned changes to the reporting mechanism in 2009/10.
British Land should be commended on its aspirations and commitment to its carbon neutral status, including the financial investment in purchasing offsetting credits. We recommend that British Land reviews in more detail the processes for the calculation of its carbon footprint and carbon neutral reporting to ensure that this reflects the changing nature of stakeholder expectations and best practice reporting in this area;
British Land has implemented some of the recommendations from the previous Bureau Veritas assurance process. This includes increasing the scope of the assurance activities and developing more clearly the links between CR performance, targets and KPIs (as demonstrated by the increasing number of performance-based targets). We recommend that British Land continues to expand the scope of its assurance activities to include, for example, all of the targets and associated reporting content.

Limitations
This Assurance Statement relates only to information included in the scope of work above and contained in British Land's Corporate Responsibility Report 2008/09, on the company's website and within the Summary Report 2008/09; no other information has been reviewed by Bureau Veritas as part of this assignment. Progress against non performance related targets was not covered as part of the assurance process in 2008. Quotes in the CR report from British Land employees or third parties are outside of the scope of work. Where information has been assured this is signposted in the CR report with a footnote.

Bureau Veritas made reference to the principle of materiality as defined in the AA1000 Assurance Standard (2003) with regard to the identification of British Land's target focus areas. The applicability of the principles of completeness and responsiveness could not be fully assessed within the agreed scope of work for this exercise.

Whilst Bureau Veritas has examined British Land's resource use data collection system, we have not systematically tested data back to source in all cases, but have verified the data collection processes and quality for two managing agents: Munroe K and Broadgate Estates.

During the course of our review nothing came to our attention to indicate that there was any material error, omission or misstatement in the information subject to review. However, this review was carried out to provide reasonable, rather than absolute, assurance and we believe the scope above provides a reasonable basis for our conclusions.

Statement of independence, impartiality and competence
Bureau Veritas is an independent professional services company that specialises in quality, environmental, health, safety and social accountability with over 170 years history in providing independent assurance services, and an annual turnover in 2008 of €2.6 billion.

Our assurance team does not have any involvement in any other Bureau Veritas projects with British Land (none of which are CR related) and there is no conflict between the other services provided by Bureau Veritas and that of our assurance team.

Bureau Veritas has implemented a Code of Ethics across its business which is intended to ensure that all our staff maintains high ethical standards in their day to day business activities.

Competence: Our assurance team has extensive experience in conducting assurance over environmental, social, ethical and health and safety information, systems and processes in accordance with best practice.

London, May 2009