The corporate sector and Scottish Government are working together for a better society, economy and future.
A quiet revolution is taking place in Scotland. Throughout the country, companies are coming together to play a much fuller role in society. Today (8 December) that movement will publish the Scottish National Action Plan for Responsible Business (SNAP-RB), a landmark document that will commit businesses and government to work together to create “a fairer society, a stronger economy and a more sustainable future in Scotland”.
Under the strapline “created by business, with government, for society”, the action plan will invite companies to join this business-led, highly-ambitious and transformational campaign.
Eight regional hubs are being formed to ensure that the SNAP-RB has “national scope, local foundations and universal relevance and impact”.
The action plan has received strong support from the Scottish Government. First Minister Nicola Sturgeon says: “I want Scotland to be the best place in the UK to do business. As part of that, we know that we need all businesses to flourish and thrive.
“This plan, which is led by business, sets out a shared ambition for ever more inclusive growth to build a stronger economy and society.
“Business in the Community (BITC) Scotland has created this platform to deliver better business for a better Scotland, which are ambitions which my government shares.
“The same goals are at the heart of the Scottish Business Pledge and our support for living wage accreditation and fair work.”
The leadership group, chaired by Royal Bank of Scotland (RBS), has drawn up four key themes to kick-off its action plan. These will provide focus for companies that want to come together to produce a wider impact through their activities.
Chief among the group’s priorities is education and specifically the role that businesses can play in supporting both students and the education system.
For students, businesses will look at projects that involve employee volunteers visiting schools to inspire pupils and get them to think about work in the future.
When it comes to the education system, businesses are likely to work much more closely with Education Scotland and the Scottish Government on the development of the entire system and to see if there are opportunities to pool companies’ resources and interests to work as a collective. Secondly, the group wants to have a focused day of action – a campaign day that will bring together as many businesses as possible to open their doors to their communities and to send their staff out into those communities to undertake helpful activities.
The day of action could include senior pupils from secondary schools visiting companies to take part in mock interviews – pupils would dress up and sit in reception just like any other candidate and then receive feedback after their practice interview.
Mentoring was also on the leadership group’s hit list for its action plan. Businesses want to take a longer-term view of mentoring by providing mentors who will work with either young people or new recruits to help them fulfil their potential.
Instead of leaving new members of staff to fend for themselves on the bottom rung of the career ladder, companies want to invest in their staff so that they not only help to grow the company, but can also use their skills in the wider community.
The action plan also aims to use the management structures and internal communication channels in businesses to support members of staff on lower incomes and help them to access the government employment benefits to which they are entitled.
At present, only around 45 per cent of young people aged between 16 and 24 claim the benefits they are due, yet it is this group that struggles with sickness, stress and poorer attendance at work – all the indicators that signal lower productivity.
The leadership group is also looking at broader issues in society, such as the potential need for a “poverty premium”.
People with very low incomes find it hard to get credit, which prevents them from taking out direct debits to access cheaper tariffs for gas and electricity, for example.
Eventually it is hoped that the action plan will help to tackle some of the longer-term problems in society.
Experts can already predict by the ages of six or seven which children will fail when they leave the education system at 16 – simply down to the fact that they’ve not been given enough food to help them concentrate during their lessons.
Scotland’s ageing population means that the labour force will shrink over the coming years and so every person of working age will need to contribute if the economy is to continue to grow in order to support retired people or people who are too sick to work.
Over the years, many businesses have tried to tackle some of the issues identified in the action plan at a local level.
It is hoped the plan will now help them to pool their resources and create projects to have an effect at a national level.
“We’ve been involved in a lot of very worthwhile but relatively low-impact projects with businesses and communities throughout the country – great things that have been making a difference for, say, ten or 20 or 30 people in Dundee or Grangemouth,” says Jane Wood, managing director of BITC Scotland.
“The businesses that we were working with challenged us to be more ambitious and have a level of ambition that would reflect their own – some of them are global businesses like Barclays, Virgin, Asda-owner Walmart and so on.
“We brought these businesses together to identify what they have in common, what they could genuinely work on together to change the landscape and move away from the inefficiencies of individual programmes in particular locations so they can tackle some of the big stuff.
“What we do with businesses in specific locations on smaller issues is still important because often it’s the staff that get involved and they want to do something in their local community.
“But when you have 20 businesses delivering 20 education programmes then you put at risk having a single, quality-assured, landscape-changing education programme that ensures we’ve got the right skills for the future.
“We talked to several businesses about this and they said they completely agreed – it’s what they do as businesses, they look to test an idea and then deliver it at scale.
“They wanted to come together around the table with other businesses from other sectors and geographies from throughout Scotland to identify what they thought could be the set priorities.”
Being a responsible business isn’t simply about supporting the workforce of the future or increasing customer loyalty – it’s also about growing the bottom line too.
Accenture, BITC and Marks & Spencer compiled a report in 2013 that identified an opportunity to generate £100 billion for the British economy through sustainable growth and productivity gains.
The report, entitled Fortune Favours the Brave, highlighted five pieces of innovation that would trigger such growth:
– “Shared value” through which companies would focus on areas in which their own interests were aligned with society such as promoting community prosperity, improving skills and enhancing health, which in turn would lead to higher productivity through increased employee engagement, reduced churn and enhanced reputation and trust
– doing “more with less” to use resources efficiently and harness clean technologies
– using the “circular economy” to reduce, reuse and recycle to cut input costs and improve margins
– adopting “new consumption models” to deliver products as a service and thus generate recurring revenues
– “transparency and customer engagement” to drive brand loyalty.
A previous report – commissioned by BITC and compiled by Cranfield University’s school of management – found companies that consistently manage and measure their responsible business activities outperformed their FTSE 350 peers on total shareholder return (TSR) during seven out of the last eight years leading up to 2011.
The TSR of those companies also recovered more quickly in 2009 following the 2008 financial crash compared with that of their FTSE 350 and FTSE All-Share peers.
“It’s phenomenal – it’s not fluffy stuff, it’s about businesses understanding that they have an enlightened self-interest in making this stuff work because it will contribute to their business’s growth, it will contribute to loyalty and it will contribute to an improved society,” adds Wood.
“The success of businesses is inextricably linked to the success of society – one cannot survive as well as it could without the success of the other.”
Susan Fouquier, regional managing director for business banking at RBS, is the chair of the SNAP-RB leadership group.
She and Bevan began kicking around ideas for the action plan after they both attended a CSR seminar.
“We wanted to get businesses around the table in a non-competitive environment and try to get them to work together on some of the issues in Scotland’s society,” she explains.
“There are lots of really good individual programmes going on out there and if we can provide a framework for us all to work together then the whole will be greater than the sum of the parts.
“From a personal perspective, I look after small and medium-sized enterprises (SMEs) in Scotland for the Royal Bank. There are lots of sole traders and small limited companies out there that do really great small stuff in their local communities.
“They would love to engage in bigger CSR, but they have neither the time nor the resources to setup their own programmes.
“This is a way for the big corporates to lend SMEs their expertise to facilitate it and make it easier for them to get involved.”
Fouquier is particularly excited about the opportunities for businesses to work together to help with education.
“For me, one of the points with the most impact is helping SMEs to work with schools,” she says.
“We recognise that there are some communities and schools that receive less support from businesses than others.
“The schools that receive less support are often the ones that need the most support.
“Businesses would love to give people ‘in-work’ experience and the opportunity to see what’s out there, so it raises their aspirations to come into the workplace or go on to further education. It’s about giving them role models.
“But it’s hard for a small business to work with a school because there are quite a lot of hoops to get through at the different local councils.
“If we can build a programme that makes that easier for the businesses then we’re opening it up to the benefit of both the businesses and the schools.
“It can be anything from supporting opportunities for employees to volunteer in schools through to educational activities, such as mentoring, career labs or business classes. Or it could be work experience – it can be quite wide.”
The activities surrounding SNAP-RB fit in with RBS’s broader work on responsible business.
When it comes to enterprise, the bank focuses its attention on business support and business creation, including through its powering of Entrepreneurial Spark, the world’s largest free business accelerator service.
The lender turned the former executive suite at its Gogaburn head office in Edinburgh into a “hatchery” – or incubation centre – for the fledgling companies or “chiclets” that receive support from Entrepreneurial Spark.
“In January, we will be launching Boost, which is a programme designed to drive small business growth,” Fouquier adds.
“It will work by helping to make the right connections between businesses and offering them access to the resources and expertise that they need.
“We’ve hired a team of 11 business growth enablers throughout Scotland to help connect businesses and give them what they need, from improving business resilience and dealing with fraud through to access to finance.”