Ground breaking new study will examine what the corporate sector is doing to create a better society
A new study has been launched to discover if businesses are doing their bit to help create a fairer Scotland.
The research, the first of its kind, will look at how companies can be supported to maximise their social and environmental value.
Social Value Lab, a research body specialising in ethically responsible business and the measurement of social value, is conducting the study with support from Firstport, Scotland’s development agency for social entrepreneurs and start-up social enterprises.
Better Business, Better Scotland will provide comprehensive evidence, drawing on an online consultation, that will reach thousands of businesses across Scotland, in-depth interviews with business leaders and chief executives, including Calmac’s Martin Dorchester.
It will contain detailed case studies featuring businesses that are doing well and doing good and will provide practical recommendations for government and business in Scotland, which will be launched to almost 2,000 political and business leaders at the Scottish Business Awards in November.
There is a growing awareness that a strong economy and successful businesses are essential to achieving a fairer society in Scotland
Social Value Lab director Jonathan Coburn said: “There is a growing awareness that a strong economy and successful businesses are essential to achieving a fairer society in Scotland.
“We see more and more companies playing a positive role in the workplace, in communities, and in relation to the environment around them. Their response is being shaped by both shareholder and customer expectations. The current Volkswagen emissions scandal shows clearly where customers stand when businesses don’t live up to high ethical standards.
“This study is timely in terms of the first minister’s agenda for inclusive and sustainable economic growth. The Scottish Business Pledge and other Scottish Government initiatives encourage businesses to make their full contribution to Scotland, for example extending the living wage, ensuring gender balance on boards, working in communities and investing in youth training and employment.
“This research will tell us where business is coming from on taking their wider ethical, social and environmental responsibilities seriously. We’ve heard talk about corporate social responsibility for the last three decades. Small family businesses already have it as part of their DNA, while a growing number of CEOs of larger corporates are recognising the challenges and are trying to push the needle.”
Firstport chief executive Karen McGregor said: “Firstport has supported start-up and early stage social enterprises that are bringing both social and economic benefits to communities across Scotland, demonstrating the business case for ethically responsible companies.
“We are committed to promoting socially responsible business in Scotland and encouraging the private sector to look at how they can work alongside social enterprises, for example involving them as suppliers, as well as learning from the good practice in the sector.”
"The cheapest quote is not always the best deal" - ferry chief on how business can promote social justice
One Scottish business leader who needs no convincing of the business case for social responsibility is Calmac chief executive MartinDorchester.
The boss of Scotland’s biggest ferry operator says acultural shift is needed to a more holistic approach if we want to create afairer Scotland.
He said: “Many private companies see shareholder returnas their reason for being. They can’t see a financial return on investing inthe community. We need to change this perspective if we want to build a fairersociety - delivering profits and short-term commercial success isn’t enough onits own.
“We set companies up as a vehicle for profit, when really theirfundamental purpose is to provide goods and services, to provide help andsupport for people and a source of employment. Social and environmental impactis not always at the forefront of companies’ day to day activity when it shouldbe part of their DNA. It’s not just a case of having a corporate social responsibility policy, it should bepart of your business plan from day one.”
Calmac’s strategy for being aresponsible business includes ongoing community engagement with both localpeople on the west coast routes it serves and the wider Scottish community; anemployment and training programme; setting waste and environmental targets forfuel use; buying produce locally, and guaranteed procurement for suppliers suchas shipyards to help them grow their business. It recently became the first UKferry operator to gain Living Wage accreditation.
Dorchester says more support is needed to encourage other Scottish businesses to follow suit: “There is very little help for businesses out there. We need a more proactive strategy from government and business groups and more academic research about the benefits, more longitudinal case studies, more high level discussions about how if you build social capital it will be more profitable for you. We also need to change how we measure success.
“We celebrate Bill Gates for building a billion pound business with high market capitalisation and share price - but we don't celebrate people who run a business employing disabled people, for example.”
The CalMac boss says the Scottish Government can help in a number of ways, including procurement, fiscal and tax regimes and improving the investment climate, while government agencies can act as an “honest broker” to bring businesses together and facilitate discussion to tackle social and environmental challenges.
He said: “For example, Calmac is a member of Argyll and Bute Economic Forum. One of the area’s main challenges is a falling population so we have spent the last three years investing in extra frequency and capacity on the ferry routes in Argyll and Bute. Calmac is 165 years old – I want it to be around in another 165
years. It’s a sensible business decision. If you as a company believe in investing in your community, you will take the long term view. If you are only interested in short term profit, you won’t do that.”
He says the public sector can also help by giving more credence to social and environmental value in tender processes: “Instead of always going for economically led tenders, they should consider if they give a business a contract now, where will that company be in two years time?
“There is an opportunity for governments and companies putting out tenders to score on social value andenvironmental impact, not just on cost. Instead of getting three quotes andtaking the cheapest, why not look at the most environmentally friendly? Thecheapest quote today may not be the best deal tomorrow.”