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The UK is ranked ninth amongst the world’s twelve largest economies for employee engagement levels (Kenexa 2009). Productivity statistics also paint a worrying picture with a recent ONS survey revealing that the UK lags 15 points below the rest of the G7 industrialised nations in productivity (International Comparisons of Productivity 2011 - September 2012).

Yet we know that there is proven link between employee engagement and wellbeing driving productivity and that the resilience of the workforce is critical to business success. Most organisations will spend money on treating people when they’re sick, when what they need to focus on is keeping the well, well. Sickness absenteeism, or leaving a job entirely due to health issues, has a huge cost to business in both sick pay and recruitment costs.
In contrast, employee engagement and wellbeing contribute to sustained employee performance, and play a key role in attracting and retaining talent.

Companies, now more than ever, need to invest in the engagement and wellbeing of their employees to appeal and retain the best people, and must start to consider employee engagement and wellbeing as a strategic boardroom issue. But how can companies make the business case for investment in employee engagement and wellbeing and better demonstrate its impact?

The Workwell campaign from Business in the Community is committed to improving levels of understanding of the role of workplace wellness, and provides companies with a robust framework to enable them to take a proactive, strategic and integrated approach to supporting people to stay healthy and productive. Business in the Community’s Workwell model enables CR practitioners who recognise that a flourishing workforce is part of the ‘CR picture’ to articulate the inextricable link between engagement and wellbeing to driving sustainable performance.
The Workwell model focuses on four principles that contribute to employee engagement and wellbeing.

Principle 1: Better work
Creating a happy, engaging working environment and providing employees with ‘better work’ is the first principle of the framework. Better work can be characterised by:
• A management style and an organisational culture that promotes mutual trust and respect
• Employment security
• Talent management
• Job design: task and variety challenge
• Autonomy, control and task discretion
• Non monotonous and repetitive work
• Employee voice.

Principle 2: Better relationships
Good relationships – at work and at home – provide the ‘social capital’ which individuals need to maintain mental health and engagement. Employers have a responsibility to promote and enable better communication and social cohesion to support good relationships in the workplace particularly among:
• Line manager
• Team colleagues
• Support networks.

Relationships outside work (family and friends) can also be supported through flexible working practices and through involvement in social initiatives.

Principle 3: Better specialist support
Better specialist support can help teams manage health issues at work or facilitate a more efficient return to work for those off work. Better support and interventions to manage health and wellbeing can be provided by:
• Occupational health
• Human resources
• Employee assistance / counselling
• Training for line managers and employees.

Principle 4: Better physical & psychological health
Create a safe and pleasant work environment by:
• Promoting a physically safe working environment with optimal air quality, temperature, noise, lighting and layout of work spaces
• Promoting healthy behaviours such as emotional resilience which builds self esteem, healthy eating, physical activity, smoking cessations, sensible drinking and avoidance of drug misuse.

A new chapter for CSR reporting, BITC’s Workwell benchmark was developed in response to research showing a positive link between strong people management and organisational performance, with FTSE 100 companies that have robust arrangements for reporting on employee engagement and wellbeing outperforming the rest of the FTSE 100 by 10%.

The benchmark also responds to investor demands for a standardised measurement of employee management that could inform their investments.

Consultation with the investment community found that evidence of responsible people management could be reported as:
• Better health
• Better engagement
• Better attendance
• Better retention & recruitment
• Better brand image
• Better customer satisfaction
• Better performance
• Stronger resilience
• Higher productivity.

The Workwell Model, which outlines specific metrics and KPIs against each of the four principles, can be downloaded free of charge from: www.bitc.org.uk/workwell

Louise Aston is campaign director of Business in the Community’s Workwell campaign 

Groupon Grassroots, Groupon’s social innovation programme, is partnering with WWF to globally address a common cause - the environment - by launching more than 20 campaigns around the world.

The expansion of Groupon Grassroots will enable people everywhere to discover local causes, rally together and lend a helping hand. Campaigns will be tailored by region and local needs; the US campaign, for example, is focused on saving black-tailed prairie dogs.

“Groupon Grassroots represents the genesis of Groupon and the company’s core mission of creating local impact through collective action,” said Patty Morrissey, head of Social Innovation at Groupon. “Groupon’s massive international presence allows us to unify this mission globally, and kicking it off with WWF promises to have a spectacular impact.”

Picture credit: WWF / Troy Fleece

The Carbon Trust is to launch the world’s first international business standard to certify the management and reduction of waste.

While it is estimated that around 11.2bn tonnes of solid waste is collected each year globally – the organic parts of which contribute around five per cent of all greenhouse gas emissions – Carbon Trust research has found that only 21% of senior executives of large companies in the UK, USA, China, South Korea and Brazil have sustainability targets for waste and 49% are not yet confident that there is a business case for investing in managing waste.

The Carbon Trust Waste Standard will require businesses to measure, manage and reduce their solid and hazardous waste. To achieve the standard organisations will need to demonstrate that waste streams are being reduced every year, or disposed of more effectively, for example through increased reuse, recycling or energy recovery.

Tom Delay, chief executive of the Carbon Trust commented: “For the past five years we’ve worked with companies across the world to cut carbon emissions and it is now time for us to apply this expertise to the global problem of waste. The new Waste Standard, combined with Carbon Standard and Water Standard, will help organisations take a more stringent approach to resources so they can operate in a more efficient, cost-effective way, as well as preserving global resources.”

The new Carbon Trust Waste Standard will also include a qualitative assessment to show that waste is being managed responsibly or prevented. This will include considerations outside of an organisation’s direct control, such as having a diligent procurement policy for goods and waste management services, or looking at downstream impacts through products and packaging.

The standard will launch later this year.

Picture credit: © Pn_photo | Dreamstime.com
 

How about this for the ultimate in greenwashing? Michinoku, a Japanese company which was - up until recently - making pampered pooch treats from one of the rarer species of whale, described itself as a green company because it used geothermal energy to melt the fat off whale carcasses…

Governments are to share their tax information automatically under an agreement reached by last month’s G8 summit to eliminate tax dodging.

This openness will be accompanied by an order to shell companies, frequently used to exploit tax loopholes and invest money anonymously, to name their effective owners.

Critics, however, complain that although the new measures target evasion, they leave untouched the perfectly legal tax avoidance devices used by large companies.

The G8 members – Canada, France, Germany, Italy, Japan, Russia, the UK and the US – expect their agreement to flush out tax evaders and money launderers by exposing the beneficiaries of shell companies, special purposes companies and trust arrangements.

The UK, for example, will compile a central register of beneficial owners but will conduct a consultation on making it publicly accessible.

The G8 agreement follows a recent similar proposal from the Organisation for Economic Co-operation and Development and comes a week after the UK announced a deal with its crown dependencies and overseas territories, including the Channel Islands, Gibraltar and Anguilla, under which information on the foreign companies banking their profits there will be shared. About a fifth of offshore tax havens used by multinationals to shelter or hide cash are British dependencies.

Delegates at the summit paid particular attention to mining companies, many of which were reported to be using complicated ownership structures in the Netherlands and Switzerland to avoid taxes on minerals extracted in developing countries.

A more aggressive unilateral measure will be introduced in the US this year compelling financial enterprises to reveal all citizens’ assets held overseas. The penalty for non-compliance would be a heavy tax.

Commentators say nations inside and outside Europe could copy the US. The G8 communiqué said significantly: “We call on all jurisdictions to adopt and effectively implement this new single global standard at the earliest opportunity.”

On avoidance, through which several large companies, including Amazon, Apple, Google and Starbucks, have legally minimised their tax bills, the G8 members appealed to individual nations.

The communiqué said: “Countries should change rules that let companies shift their profits across borders to avoid taxes.”

The present legislation allows revenue from UK customers to go directly into foreign bank accounts, permitting companies to avoid UK tax, even if they trade in the country.

The G8 members drew some hope from a meeting of G20 finance ministers, due this month, which could propose rule changes. They promised to “take the necessary individual and collective action” to back G20 recommendations.
The more cynical observers likened the resolve of the UK prime minister David Cameron to rewrite the rules to the 2009 declaration by his predecessor Gordon Brown welcoming “the beginning of the end for tax havens”. Such optimism was seen by many as premature.

Murray Worthy, tax campaigner at the UK anti-poverty group War on Want, said: “Talk of stopping companies shifting profits to avoid taxes is a huge step forward, but we have heard great promises from the world’s heads of state before. It is what they do that counts.”

Alex Prats, Principal Economic Justice Advisor, Christian Aid told Ethical Performance: “The summit was a success in that there was clear acceptance that the tax abuse we estimate costs developing countries some US$160bn a year must be stopped. The question is how. The summit endorsed Automatic Exchange of Information. It also supported country-by-country reporting by multinationals to help end profit shifting into low-tax jurisdictions, but, unfortunately suggested such information would only be shared with tax authorities. And it failed to live up to expectations over establishing public registries of ownership of companies and trusts, which would help end tax haven secrecy. It agreed registries be established, but again, only open to the authorities. So it was a start, but there is still a long way to go.”
 

Concerted action against food wastage in the UK and an expansion of the government’s bilateral nutrition programmes have been urged by British MPs.

The parliamentary international development committee issued a global food security report as world leaders gathered for last month’s international nutrition summit hosted by the UK government.

Sir Malcolm Bruce, the Liberal Democrat MP who chairs the committee, said: “There is no room for complacency about food security over the coming decades if UK consumers are to enjoy stable supplies and reasonable food prices.

“UK aid to help smallholders increase food production in the developing world is of direct benefit to UK consumers as rising world food prices will reduce living standards of hard-pressed UK consumers. There is … considerable scope for the government to launch a national consumer campaign to reduce domestic food waste within the UK food production and retail sectors, with clear sanctions for companies that fail to meet these targets.”

Food availability worldwide, however, is being compromised and food prices are becoming higher and more volatile because of the use of agriculturally produced biofuels, a trend intended to bring environmental benefits, the committee said.

It predicted EU targets requiring 10% of transport energy to be drawn from renewable sources by 2020 could raise food prices dramatically because biofuel plants and trees displace food crops – some of which provide power generation more damaging than fossil fuels.

The MPs proposed that agricultural products should be excluded from the UK’s Renewable Transport Fuel Obligation requiring fossil fuel suppliers to confirm that a percentage of their road transport fuel is renewable.

They then asked why the international department worked bilaterally in 29 countries but ran nutrition programmes in only 16 of them. They want the government to expand its coverage.

A second demand from the MPs was for the department to explain why it failed to fund social protection programmes in 14 of the 29 countries, even though this measure protects the food security of the poorest against price rises.

Another worry was that in developing countries corporations are buying large areas previously farmed by smallholders. The committee recommended that UK corporations must be transparent about land deals.

It emphasised that smallholder farmers had a vital role in feeding the world’s population, projected to reach 9.3bn by 2050.

It therefore asked the government to increase funding for agricultural services, especially to help women, and the formation of inclusive farmer organisations and co-operatives, enabling smallholders to work with large companies and markets.  

Companies interact with children on a daily basis, although often this is neither directly nor purposefully. Children are workers in their factories and fields, family members of their employees, and community members in the neighbourhoods where they operate. In many countries, children are increasingly recognized as a consumer group themselves, with discretionary income to spend and increased influence on family purchases. They are a market force to be reckoned with, but nonetheless need protection.

Even while business and human rights discourse has evolved significantly, children have not been adequately considered by business as a key stakeholder group. A business focus on children’s issues is often relegated to eradicating the practice of child labour, or to investing in local community initiatives that support children. The past few decades have indeed seen greater corporate commitments to cleaning up global supply chains in order to eradicate the use of underage workers. Yet the need goes beyond child labour considerations.

Morals aside, there is good reason for companies to pay attention to their impacts on children’s rights. Exclusion of a holistic child rights lens within corporate human rights initiatives can create a number of risks for business, not least reputational risks from stakeholder allegations of direct or indirect violations of children’s rights; legal risks from lawsuits for alleged violations; financial risks from mishandling children’s rights within business operations; security risks from failing to earn the company’s social license to operate; and market share risks from consumer action on lack of attention to child protection. Furthermore, governments are increasingly likely to implement policies that govern business’ respect for children’s rights.

Recognising a need for explicit guidance about what it means for business to respect and support children’s rights, the UN Global Compact, Save the Children and UNICEF – together with companies and other stakeholders – released a set of 10 Principles on Children’s Rights and Business (‘the Principles’) in March 2012. Building upon the UN Guiding Principles, the Principles identify a comprehensive range of actions that all business should take to prevent and address risks to children’s rights and maximize positive business impacts in the workplace, marketplace and the community.

In February, UNICEF began a three-month consultation and pilot process to review and begin implementing the Principles. Participating companies are reviewing the Children’s Rights Checklist – an impact assessment tool; the UNICEF Workbook - Children are Everyone’s Business and the Reporting Guidance to embed children in sustainability reporting. Following the pilot, UNICEF will release the tools and make them publicly available.

Amaya Gorostiaga, CSR unit, UNICEF’s private fundraising & partnerships division 

Milka maker Mondelez International is set to help farmers increase sustainable cocoa production in Ivory Coast following an agreement with the local Conseil du Café Cacao. The chocolate giant will work with NGO Care International to lead a variety of ‘Cocoa Life’ projects.

Global hospitality company Hyatt Hotels Corporation recently unveiled a new social pledge campaign called Commit To Thrive, which asked employees, guests, and local residents to take an online pledge to commit to making a positive difference in their communities. For each pledge taken - up to 35,000 - Hyatt donated a book to a child in need through Room to Read and We Give Books.

Pro-active approach
Indeed, the group prides itself on its pro-active approach to community engagement. Now in its third year, the Hyatt Thrive Global Month of Community Service focuses on volunteerism “to make local communities places where Hyatt associates are proud to work, where guests want to visit, where neighbours want to live, and where hotel owners want to invest”. Hyatt Thrive, the company’s corporate responsibility platform, is based on four key pillars: environmental sustainability, economic development and investment, education and personal advancement, and health and wellness.

As a part of the Hyatt Thrive Global Month of Community Service this year, Hyatt worked with coffee chain giant Starbucks, where they collaborated on a day of service in Hyatt’s hometown of Chicago. Hyatt staff and guests, along with Starbucks employees, customers, and Chicago community members, volunteered in Chicago’s Englewood and New City communities on Chicago’s South side.

In addition to working with Starbucks, Hyatt hotels recently began working with Clean the World, a non-profit organisation that collects recycled soap and shampoo products discarded by the hospitality industry and donates them to impoverished people around the world. Through the distribution and donation of these products, Clean the World helps to prevent millions of deaths caused by hygiene-related illnesses every year.

There are currently 20 Hyatt properties around the world that work with Clean the World that have collectively donated more than 19 tons of soaps and amenities to date. To kick off the newly formed relationship, Hyatt Hotels & Resorts donated amenities worth $15,000 and will also encourage employees to get involved and help give back to the communities they call home.

Global initiatives
Community-oriented programmes take place around the world. In London earlier this year the hotel chain’s Andaz Liverpool Street employees cooked and served breakfast to homeless charity, Providence Row, clients and also painted and refurbished the organisation’s reception area.

In Shanghai, a dedicated team of volunteers from Grand Hyatt Shanghai, Hyatt on the Bund, Park Hyatt Shanghai, and Andaz Shanghai made a special visit to the Shanghai Social Welfare Institute where they organised interactive games, as well as song and dance performances for more than 150 children and seniors in need.

And in India staff of the Grand Hyatt Mumbai and Hyatt Regency Mumbai joined together to address education and personal advancement, health and wellness, and environmental sustainability in Mumbai. The hotels worked directly with Aseema, a charitable organisation providing underprivileged children with educational opportunities. Staff dedicated a day to volunteering at Aseema, providing children with fun, engaging and educational-based activities.

Local relevance
Additionally, in support of Mumbai’s Mahatma Gandhi blood bank, both hotels conducted a blood donation drive to help fight Thalassemia, a well-known red blood cell disease affecting India’s youth. Lastly, in support of environmental sustainability and Earth Day, both Grand Hyatt Mumbai and Hyatt Regency Mumbai launched a “Plant a Sapling” initiative, which encourages employees to plant saplings in and around their communities.

Comment from Insitute of Business Ethics

Hyatt Hotels Corporation clearly understands the business benefit of engaging staff in its commitment to being a socially responsible business. This should help embed their four pillars of their platform into all aspects of business behaviour.

Of note in this case:
• its success in harnessing, through their place of work, employees’ motivation to contribute to their wider communities
• the local nature and diversity of the projects
• that the company has also drawn customers and local residents into their pledge so that the influence of the project is widened most effectively.

Dr Nicole Dando
Head of Projects  

Collaboration, either between different divisions of large corporates, or between companies and organisations in related fields, is not just a simple case of pooling expertise. There are lots of other CR business benefits too discovers Patricia Mansfield-Devine

When it comes to corporate social responsibility, companies often find that there is strength in numbers. Collaboration, either between different divisions of large corporates that effectively run as separate companies, or between companies and organisations in related fields, results in a pooling of expertise, reduced overheads and sometimes the ability to access grants from national and international bodies that might not otherwise be forthcoming.

Natural products trade association PhytoTrade and the Union for Ethical Biotrade (UEBT) have recently partnered with the International Finance Corporation (IFC) to promote ethical sourcing and biodiversity in Africa. The partnership aims to protect the natural environment and reduce poverty in the countries involved, principally Tanzania, Mozambique and Malawi, which produce raw materials such as baobab and mafura, whose seeds yield a fatty butter that is used for conditioning the hair and skin.

The IFC is a member of the World Bank Group, and focuses exclusively on the private sector. Africa is rich in biodiversity, says the organisation, and there are many opportunities in the region for the production of ethically sourced products in both the food and cosmetics markets.

“When we asked 5,000 consumers what would make them purchase a product containing natural ingredients from Africa, protecting biodiversity and improving the livelihoods of African producers were the two most popular responses,” says Rik Kutsch Lojenga, executive director of the UEBT.

“This partnership will allow us to promote ethical sourcing of biodiversity in Mozambique, Malawi and Tanzania.”
Via the project, Phytotrade Africa aims to facilitate low-income farmers’ access to international biotrade markets and develop sustainable supply chains. It will map the availability and production capacity for the natural ingredients, and find community associations or co-operatives and SMEs that can be helped to process and market the products.
The project also aims to link those associations and SMEs with international markets.

In terms of how the partners work together, “The UEBT is a standards-setting organisation, so they provide a way of linking business in the developed world to businesses in Africa,” says Jonathan Landrey of Phytotrade.
“It gives people assurance - though not guarantees - that their suppliers are following the right standards to sustainability, fair trade, environmental protection etc.”

The Fair Trade (FT) model works well for commodities that can be traded in large volumes, he points out, because players can afford the FT certification and charge a premium. “But if you don’t have high volume or are producing more niche ingredients, then Fair Trade certification is too expensive to obtain.”

The UEBT provides a system that is intuitive for SMEs to follow. “Like a ladder, there’s a staged approach for SMEs to become fully certified,” he says. “Then, companies like Weleda are happy to work with them - the UEBT helps to bring in the big players, which are also its members.”

Meanwhile, the IFC’s role in the partnership, says Landrey, is to manage a fund originally set up by the Swiss, Danish and Dutch Governments to support the development of biotrade.

“[The IFC] is interested in developing new markets that will be able to access the forming banking sector,” he says. “The money they’ve provided Phytotrade with has helped to provide access to investment with the aim of developing SMEs to a level where they can obtain finance from venture capital etc.”

He adds: “We need to develop biotrade so that these companies can access technology to trade more efficiently, as we have come to a tipping point with artisan production and can’t just keep adding more people with more hand presses - scalability is limited. What is needed now is technology and that requires financing and solid supply chains and co-ordination.”

The IFC specifically deals with small-scale private sector investors and it also advises Phytotrade on impact - gender-based impact in particular - and how the money is being utilised. “They have skills to improve how we collect information,” says Landrey.

Meanwhile, in Europe, French governmental funding for the Genesys project has been given the go-head* by the European Commission (EC), stimulating another collaborative project.

Genesys, which is still at the research stage, aims to develop a new ‘zero-waste, positive-energy’ third generation of bio-refineries in France, using oilseed and lignocellulosic biomass from agricultural and forestry residues and urban waste to produce clean energy. Sources will include maize stalks, sunflower seed and rapeseed.

The energy will be in the form of electricity and heat, and the refineries also aim to produce food products and chemicals. The project also has an ambitious target of publishing around 100 scientific publications per year and filing around 40 patents on oilseeds and lipids over the next 10 years. Patent licences arising from successful projects will be sold to interested firms on commercial terms.

SAS Pivert, the holding company set up to run Pivert IEED (Picardie Innovatons Végétales, Enseignements et Recherches Technologiques Institut d’Excellence en Énergies Décarbonées), and which will run the Genesys project, will be 50% owned by the public sector and 50% by the private sector.

The public arm includes a handful of major universities and 14 other public research bodies acting together in a consortium, while the private arm consists of six industrial partners from the chemicals, food manufacturing and engineering sectors, who were chosen by the EC from the firms who answered the tender.

They include major French agri-food group Sofiprotéol; international chemicals group Solvay Rhodia; sugar technologist and bioethanol producer Maguin; French fine chemicals group PCAS; engineering and construction group SNC Lavalin; and IAR (Industries & Agro-Ressources), itself a ‘competitive cluster’ of around 215 companies.
To carry out their R&D work in biorefining, the partners will have access to a specially designed building and experimental facilities: the Centre BIOGIS, which should come on line in 2015, will make up the heart of an industrial zone that includes training facilities, processing plants and biodiesel production.

The partners were chosen by the EC because they have all developed specific skills and competencies that are useful and necessary to carry out the R&D activities.

The primary goal of research organisations is to conduct independent research to produce public scientific knowledge and they may have fewer options than specialised enterprises to respond to the technological and economic needs of the industry.

However, private investors would be unlikely to spontaneously put money into technological activities that give rise, for the most part, to free knowledge transfers.

The project, therefore, allows the universities to provide the initial research expertise, with 150 researchers - an overhead that would be impossible for the companies to provide - then later the companies will further refine and then commercialise the products that result. Patents will be granted in a joint-ownership fashion that reflects the different bodies’ personal contributions to the project.

IAR, the cluster involved in SAS Pivert, focuses on creating regional biorefineries based in the heart of production areas. Sixty per cent of its members are private and 40% are SMEs.

“The idea is to get a handle on R&D,” says Johan de Coninck, business development manager
at IAR.

“We will never produce an end product - we will build an intellectual property (IP) portfolio that will be proposed to our partners, which are grouped into a sort of a club. They pay us to get first refusal on that IP. If they are interested, they pay an option and then royalties if they are able to market it. If not, then we’ll put it out on the free market. Club membership is quite broad and includes firms such as Clariant, Archema, Chimex and BCIS.

“Any type of oilseed biomass will be produced,” he continues, “but since we are in France, it will probably be rapeseed, though we’re open to working with anything. We already have two big biorefineries on site, one right next to Pivert and owned by Sofiprotéol - a crushing plant for rapeseed oil that produces biodiesel and resins.”

What the collaborative enterprise of SAS Pivert permits, says de Coninck, is “to allow our members to innovate better and accelerate time to market for their innovations.”

Case in Point

One company that prides itself on its sustainability credentials is Coca-Cola, a firm that measures its commitments against key performance indicators and publishes them annually in a sustainability report.

PlantBottle is just one of its initiatives. Introduced in 2009 as the first fully recyclable PET plastic bottle made partially from plants, it recently passed the 15bn bottle mark. Around 8% of Coca-Cola’s PET plastic bottles last year contained PlantBottle technology.

The packaging offers the same functionality and recyclability as traditional PET plastic, claims Coca-Cola, but with a lighter carbon footprint and reduced dependence on fossil fuels. It uses natural sugars found in plants to make ingredients identical to fossil-based ingredients traditionally used in polyester fibres and bottle resins.

Coca-Cola has also collaborated with environmental organisations and academic researchers to ensure that the raw materials used come from sustainable sources and do not compete with food crops.

In addition to eliminating the equivalent of around 140,000 metric tons of CO2 emissions, the new technology also has business advantages, with Coca-Cola using PlantBottle as a key differentiator for its water brand Dasani.

At a time when it was suffering from falling sales, Dasani created a striking new visual identity for PlantBottle – including an image of a big leaf and green closures that played up the packaging’s connection to plants and nature - and saw its sales increase by 12%.

Rather than keeping the technology to itself, Coca-Cola has also taken the decision to license it to other manufacturers such as Heinz, which is now using it in its ketchup bottles. Since production began in 2011, more than 200m 20-oz ketchup packages, featuring ‘talking labels’ asking, “Guess what my bottle is made of?”, have been produced for sale in the US and Canada.

In anticipation of further licensing deals in the future, Coca-Cola has also teamed up with manufacturer JBF Industries to build a world-scale production facility for the bottles in Brazil.