The number of climate change-related jobs in the workplace is growing, which means more UK boardrooms could be welcoming a corporate social responsibility director to the table. But is this phenomenon a must-have or a flash in the pan?
In light of turbulent stockmarkets, the credit crunch and a global economic downturn, it's easy to assume that climate change and wider issues of corporate social responsibility (CSR) might be pushed down the corporate agenda. But instead of tightening their belts and focusing on the bottom line, UK directors aren't cutting back on CSR, according to research published by sustainability recruitment consultancy Acre Resources.
Its latest CSR salary survey shows that issues such as governance, environmental management, social equity, and employee and community relations are actually becoming such a significant issue that a growing number of businesses are appointing specialist officers to develop and enforce clear CSR strategies. Climate change, in particular, is climbing the corporate agenda—the number of climate change-related jobs has grown by 200 per cent in the last year.
Tom Leathes, director of Acre Resources, explains: "CSR has gone from something that was a bit fashionable to something that is much more broadly accepted. Some companies have whole teams doing this now—we have just been working with Sky, which has a team of 20 to 30 people dedicated to it."
Although larger companies such as BT, the Body Shop and Marks & Spencer have been hiring CSR specialists for a number of years, Leathes says he has seen a growing number of smaller companies taking them on in the last 18 months.
Stephen Howard, chief executive of Business in the Community (BITC), has noticed a similar increase in the number of businesses getting involved with his organisation. BITC provides support and advice to help organisations improve the impact they have on society and the environment. "CSR is getting more boardroom attention; universities now run degree courses in CSR," says Howard. "Like the evolution of the HR professional, we are seeing the evolution of the CSR professional."
The climate-change agenda is partly responsible for the rise of CSR as a boardroom issue. But other factors—such as the financial scandals at Enron and WorldCom, and more recently Société Générale, as well as alleged labour abuses at Nike and Gap—have also put CSR on the priority list. According to Howard, businesses are increasingly using it as a tool to manage risk and reputation: "Wider stakeholder groups—local authorities, public bodies, customers and prospective staff—are all asking questions about how companies are fulfilling their environmental and social responsibilities. It is an issue that is here and now, so businesses need to look at how they are going to respond."
Leathes points out that the future will bring more regulation aimed at reducing carbon emissions and managing waste. He believes compliance will push companies to hire specialist CSR staff in-house, as outsourcing can be expensive.
This growing demand for CSR specialists and the increasingly senior status given to the role are reflected by large rises in average wages in the sector—from £19,000 in 2005 to £45,000 today. "In order to get buy-in from all the different stakeholders, it has to be a senior role," says Leathes. But he adds that these salaries are still not in line with more established industry positions. CSR budgets and team sizes are still relatively under-developed compared to those of more entrenched areas, such as marketing, HR, finance and IT. And less than half of CSR heads report directly to the chief executive or other main board director.
As well as the ethical and regulatory argument for behaving responsibly, the business case is compelling, says Howard. He reckons it will help to build your brand and reputation, as well as help recruit, retain and develop staff. "Generation Y loves mentoring and volunteering," he says. "A sound CSR strategy can help build your employees and hold onto your best people."
So although businesses need to watch costs and spending during a downturn, it may not be the time to cut your CSR budget. "You have to think about how to keep your staff and your customers," says Howard. "Identifying what your business stands for is even more relevant in a downturn. At times like this it really puts your business model to the test."
Leathes agrees that CSR presents an opportunity for businesses of all sizes. "Companies that develop a strong CSR programme, and integrate that into their brand and marketing can gain competitive advantage," he says. "The buying public are much more aware of environmental and social issues. They are looking toward companies who can make this easy for them. For example: 'If you buy our product—and not our competitor's—you are being more environmentally/socially responsible.'"
But Leathes points out that appointing a CSR officer is more relevant for some companies than others. "It is naïve to say any company that does this will see a massive rise in sales," he says. "Some oil and tobacco companies have a massive social and environmental impact, and this needs to be managed and made clear to the public that it is so. It doesn't make any money necessarily. Businesses need to make sure it is the right option. They don't have to do this at the moment, but it could be a good investment for the future."
Sounds like it's time to make more room at the boardroom table.
Case study 1Who Big Yellow Self Storage Company
CSR manager Paul Donnelly
Investing in a CSR manager has been a sound strategy for the Big Yellow Self Storage Company. It appointed Paul Donnelly last August to manage its environmental and social activities. In light of its development and expansion programme, the company directors were keen to ensure all new buildings were energy efficient and built in accordance with EU legislation. They also wanted the operation of the stores to be more efficient and to see economic savings through the repair and maintenance of existing buildings.
"Our biggest energy usage is light," explains Donnelly. "We have just done a trial in our Luton store, changing all the light bulbs from T8 fluorescent tubes to more energy-efficient T5 tubes, which reduced energy consumption by 30 per cent over a six-month period." As a result, he says, all new stores will be fitted with T5 bulbs.
Other measures include generating renewable energy using natural resources, such as solar panels, wind turbines and ground-source heat pumps. On an operational level, Donnelly is looking at energy and waste management in stores. He highlights the importance of getting all staff involved. "It's all about integration," he says.
The strategy also allows Big Yellow to tick boxes in the sustainability checklists when filling in local planning applications. "This helps us win land and building permission, another driver for us to comply," explains Donnelly.
But his remit is not just environmental responsibility, it is also about social and sustainable development, and linking those together. "We have a giving policy and each store has a charitable budget," says Donnelly. "Our charitable giving is related to what we do. We store supplies for disaster relief so it can be accessed and distributed quickly.
We also work with local charities, storing second-hand goods that are to be resold in charity shops or storing equipment for charities that is going overseas."
The strategy seems to be having a positive effect on employees. Although it's too early for Cheryl Hathaway, Big Yellow's head of HR, to assess a direct link to recruitment and employee turnover, she says that the results from the latest staff survey confirm the importance of CSR to staff and a positive effect on morale within the organisation.
Case study 2Who Workspace Group
Sustainability project leader James Dixon-Gough
Workspace Group lets out commercial property space to SMEs in and around London. Although various people in the company have been involved in sustainability, new legislation last year prompted the company to appoint a sustainability project leader—James Dixon-Gough.
The company's main contribution to climate change is made up of its direct energy consumption, and the maintenance and refurbishment of its buildings. But with only 180 staff, Dixon-Gough explains that a considerable contribution comes from customer use of the buildings. "We manage our customers' waste and recycling so we try to encourage them to do more," he says.
Dixon-Gough is responsible for improving the metering of energy and increasing the efficiency of its buildings, many of which were originally designed and built to serve different purposes. "The challenge is to work with the existing fabric of the buildings to create lettable, thriving business centres, which are resource and energy efficient," he says.
The company's sustainability policies are welcomed by customers, staff and investors. "We get good feedback from tenants. Our sustainability policies reflect well on clients and reduce their service charges. The staff like working for a company that's trying to do something," explains Dixon-Gough.
And it stands the business in good stead, too. "When we need to get planning applications through, there are lots of loops to jump through. Having sustainability policies in place puts us a foot further forward," he says. "It also makes marketing the property easier. If the message is communicated effectively, it sways people to be in your property".
The company's sustainability policies also involve working with public agencies on regeneration schemes, consulting with local residents and sponsoring local events. It supports two charities, Richard House Children's Hospice and Kids Company.
"We run fundraising events and each employee has two volunteering days per year," says Dixon-Gough. "The staff get really involved. It gives them a chance to do something fun with the other team members.
It's really appreciated."