Waste management company Veolia UK has found new revenue streams by encouraging diversity, nurturing youth and opening the innovation process up to all
Step into the UK headquarters of Veolia in London’s King’s Cross and there are few hints you’re in the offices of an environmental services company. With sweeping views across the capital, the building is dominated by greenery, glass and light.
The traditional idea of a ‘hold and dump’ waste management company is not what springs to mind – although, granted, visitors are also greeted by a row of toilets displaying messages about water usage and its environmental impact.
This change of image is all a part of the shift in strategy brought about by executive vice-president Estelle Brachlianoff, who took over responsibility for the UK and northern Europe side of the business in 2012.
A French company, Veolia has been in the UK since the mid-1960s, employing 16,000 people here and in Ireland. With a €2.3bn (£1.9bn) turnover it has considerable spending power and is set to invest £1bn over the next four years. Its waste, water and energy services affect half the UK population through London boroughs and county councils, as well as private businesses such as Asda and AstraZeneca.
“What people usually think of when they think of Veolia is collecting bins from the drugs industry, which is part of what we do but only part. What we do behind the scenes is a lot more than that — [including] treatment of waste, meaning recycling and producing energy from the waste,” explains Brachlianoff.
“We are a leader in the industry, not just because we are the biggest, which we are, but because we do our business in a very different way. The business of waste used to be ‘hold and dump’; you had trucks and you put everything in the landfill, which was the case 10-15 years ago in this country. Now it has evolved a lot, but even more so in Veolia than in other companies.”
A circular economy
Though she is still within the first two years of her tenure, Brachlianoff has already overseen dramatic change – whether it be the collection of a rare metal from the dust left behind by street sweepers; the establishment of manufacturing plants in Southwark, south London, which convert residual waste into heating, securing the price of energy for residents; or the milk bottles now used by Marks & Spencer, which Veolia converts from recycled plastic.
These are all examples of what Brachlianoff calls the ‘circular economy’.
“In the linear economy you design, you manufacture, you sell, you consume and then you dump it, you waste it,” she explains. “In the circular economy, yes you dump it – but it is used to close the loop and make something out of it.” In effect, therefore, Brachlianoff has helped convert Veolia into a manufacturing company producing new things or energy from waste and waste water.
“What is important for us is that we produce energy and material that we sell on the market and we also produce some specific end-of-line products directly ourselves, so it is different from the industry many might have in mind,” she explains, adding that this approach has played a part in producing a healthy average of four per cent organic growth in what is a very mature market.
The changes came from a realisation that the company needed to innovate to stay ahead, says Brachlianoff. “The world moves very fast and, if you don’t move with it, even a successful company today can face a lot of disruption tomorrow… Veolia is not exempt from this threat.”
In the 10 years before her arrival, growth was driven by the Private Finance Initiative – the government scheme to fund public infrastructure projects with private capital – but this was coming to an end. “If we were not very careful and [didn’t change] our strategy completely, we would be very successful but then progressively end up without having any growth again,” she says.
In a bid to communicate changes to the workforce, Brachlianoff organised company-wide roadshows and education for staff about the circular economy. She estimates 80 per cent of staff are now on board.
When it comes to building a company culture Brachlianoff says her two key values are ‘truth in the room’ and an open mind. “It’s about a positive attitude toward change and vision,” she says. “It is not exactly what I found here [when I arrived]; neither the truth, nor the thinking out of the box. They were not welcomed at the beginning, I think it was a cultural shock for everybody.”
Change has started at the top of the business and the shape of the board and the executive committee has been overhauled. Diversity, which Brachlianoff points out is about more than gender, is at the heart of the journey she envisages for the company.
“If you only have people around the table who all look the same, are from the same background, with the same professional history, from the same country and with the same culture and gender, you end up reproducing exactly what has worked in the past but probably won’t be the business solution for tomorrow,” she says.
On a director level the Veolia UK board is now 29 per cent female; a figure that used to be just two per cent. The executive committee counted no women at all when Brachlianoff arrived, now there are four out of 11. There is a mix of nationalities and, she says, it helps that not everybody is from the waste and water industry.
There has also been a move to encourage innovation from across the workforce. In companies of Veolia’s scale, innovation has traditionally come from technically based R&D teams but, according to Brachlianoff, this risks missing out on a lot of ideas.
“I have 16,000 employees and, now they know what we are aiming to do, they have expressed some ideas directly – and to formalise that we have organised innovation days. Everybody in the company can pitch, they can ask for money and time to develop it. We have already approved a dozen ideas and they are now going into our incubation phase and will become the projects of tomorrow,” she says.
The aim, she adds, is to blend the power of a big company with an entrepreneurial spirit more often seen in SMEs. “We want to combine those and have people who will be entrepreneurs in the company, [and we are] dedicated to developing their idea provided it’s aligned with strategy. It is very powerful when you use the best of both worlds.”
Veolia: The next generation
Sustaining this emphasis on diversity and innovation relies, of course, on a steady stream of new graduates joining the company with the right skills and ideas.
The day Brachlianoff meets Director she has been to a government meeting on how to attract more women into Stem (science, technology, engineering and mathematics) careers and is clear this is a big challenge for the sector, citing issues on two levels.
“The first is that when you think of waste, water and energy you don’t think it would be naturally attractive to young graduates, but if you are slightly interested then you think it’s great,” she says.
“The second issue, which all companies in the country face, is the lack of Stem graduates. Everybody has an issue with recruiting Stem-based graduates and specifically female graduates. This has to change because otherwise it will hurt the country in terms of growth.”
Veolia is making progress on the first challenge, having seen an increase in applications to their graduate scheme and the proportion of female applicants up to 38 per cent. “Two or three years ago they wouldn’t even think of applying,” she says.
This is the result of a concerted effort to spread the message. All senior team members, including Brachlianoff, have visited schools and colleges while managers have been encouraged to get involved with their local communities.
In Wolverhampton, an in-house training facility, Veolia Campus, has been established and won several awards, including an NVQ award. “We don’t just train managers but also people who otherwise have no qualifications, so it is both ends of the spectrum,” she says.
The wider solution to the lack of interest in Stem, says Brachlianoff, requires a more collaborative effort, which must include business, industry and government, parents and teachers, and this is likely to be a long, challenging journey.
“We need to make everybody aged 10 to 15 understand that Stem is not only for nerds with big glasses. They need to know it allows you to open doors to pretty much every sector: from hi-tech, environment and manufacturing to engineering and building.”
A good time to be green
It’s a timely moment to be involved in green innovation. According to Brachlianoff, only 10 years ago, the UK was one of the biggest countries in Europe to be trailing behind in the green agenda. Now, thanks to influences including pressure and legislation from the EU, it has caught up.
“The UK is now at the same level as all the big countries in Europe,” she says.
“Will this last? I hope so because I fight against the vision that you can be green only if you can afford it. Once you have an economic crisis or people have issues with living wages then there’s talk about dropping the green agenda.”
Veolia, she says, is proof that the two can co-exist. “We create jobs, we invest in this country on a green agenda without any subsidies because it is a virtuous cycle…
In the last five years we have created the equivalent of 36,000 jobs by all the construction work we have done.”
Veolia is currently the sector leader, says Brachlianoff. “We are the company people will probably follow. We invest money into the ideas, so it is organic growth with some investment. I won’t [rule out] acquisition at one stage but it will be for a small, very specific technological area that we would have in our portfolio,” she says.
The speedy progress has left her hungry for more innovation and positive change. “You have to deliver the project and to make it real. I am very proud to see that not only do we have a completely new strategy, but it is shared by the vast majority of people in the company and we have started to deliver some of those examples,” she says.
“We’ll have achieved something as a team once Veolia is associated with sustainability and the circular economy; when you think ‘Veolia can help us with that’. When all of our 16,000 employees think like that, I will know I am done.”