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Green Crusade

With talk this week about the need to make many UK firms include details of their carbon emissions in their annual reports within the foreseeable future, it’s time that everyone joined forces to navigate a path to a greener future.

The climate change has been caused by the increased levels of greenhouse gasses in the atmosphere, in particular, carbon dioxide (C02). So what can today’s businesses do for the future of our planet?

The government’s Act on C02 campaign recently highlighted the need for the country to pay more attention to its carbon footprint. The Act informed the nation of how it can save money by becoming greener: from driving Smart, to purchasing appliances, to improving home efficiency.

Everyone – from multinationals to small businesses – is responsible for their carbon footprint and all can make a difference. Working with companies such as Carbon Passport and The Carbon Neutral Company, businesses can gain advice on how best to implement a carbon strategy, advice on carbon reduction and energy saving opportunities. They can provide carbon offsets for balance of greenhouse emissions, for example, by investing in wind farms. These companies can also assist in developing PR and marketing strategies to promote their green credentials.

This month, The Copenhagen Climate Council will discuss how firms can help to solve the climate issues; CEOs will discuss innovative business models, new partnerships and the development of low-carbon technologies. In addition to these issues, they will also address ways to remove barriers that are still in the way and create incentives to implement solutions in a post-Kyoto framework.  

The government has started to address the issue of carbon offsetting by setting up a quality assurance scheme. This is when you can compensate for your unavoidable emissions by paying someone to make an equivalent greenhouse gas saving. By marking their status as an approved carbon offsetter, companies can gain a marketing edge in this tough economic climate.

Leading by example are PricewaterhouseCoopers (PwC), who have taken accountability by tracking the carbon emission of their employees’ international travel and energy wasted. In response, they have installed £500m worth of videoconferencing equipment to reduce the need for carbon-costly air travel.

PwC offset all of their carbon emissions by funding green projects in India; these projects include generating renewable electricity and steam from local waste rice husks to supply the electrical needs of a textile mill. Back in the UK, they supply 20% of the total energy needed for the company by using solar water heating panels and are continually attempting to increase their efforts.   

If they haven’t already, each and every company nationwide can do their bit to help. This can be achieved by doing something as simple as making desk-side bins a thing of the past and encouraging employees to recycle more.

Social Enterprises rejuvenate the economy

With the economy continuing to struggle and the nation in need of a brighter-looking future, it’s time for the Third Sector to lift Britain’s communities out of the turmoil created during the recession.

Social Enterprises (or what the government refer to as the Third Sector) will play a pivotal role in the growth of the so-called ‘new economy’. In times of regeneration, the government need to turn to the likes of Phone Co-Op, who have thrived in a highly competitive market, retaining their ethical and environmental policies. They are committed to providing greener telecoms through a range of measures that include buying greener electricity from renewable sources, investing in wind power and offsetting carbon emissions. Another exemplary company is the Wise Group in Glasgow, who are helping unemployed people find jobs by supplying training and work experience programmes. Both of these prestigious companies were winners in the Enterprise Solutions Awards 2008.

Many businesses would consider themselves to be Social Enterprises. However, the true characteristics of Social Enterprises are to be found in those businesses that hold their social and/or environmental purpose central to the running of their organisation. This should be favoured over the importance of getting higher return to shareholders, which given our current situation can only be in the public’s interest. Social Enterprises have a close connection to the community that larger corporations can’t buy. According to the Social Enterprise Coalition they already contribute £8.4 billion to the UK economy, and of a survey of 2,000 people, 30% said they would rather work for a Social Enterprise over any other kind of company. 

With redundancies in 2009 at their highest since records began and unemployment reaching 2.2million (the highest figure since 1981), there is a serious need for extra help to get the nation back on its feet. Communities Secretary Hazel Blears and Work and Pensions Secretary James Purnell emphasised that the government recognises the important role that Social Enterprises will need to play by creating 15,000 positions for Britain’s unemployed. The government will help with funding through the £1b Future Jobs Fund.

The jobs created through the Future Jobs Fund have to be sustainable to put the economy back on track and produce social value. Third Sector organisations can help to generate this much-needed social value through innovating and unique programmes, such as the Merseyside Getting Out To Work. This programme offers intensive, one-to-one support to ex-offenders to help get them back into permanent employment. Working with The New Economics Foundation, they assessed their social value and the final study showed that for every £1 invested, it generated £10.50 of social value in relation to reduced welfare costs, reduced crime rates and an increase in tax contribution. This has been calculated by measuring the value of the benefits relative to the cost of achieving the benefits (net present value of benefits/net present value of investment).

As well as the Future Jobs Fund, the government is encouraging Social Enterprises to boost the economy by addressing issues such as assets, finance, working with the Public Sector and business support. All of these issues have been raised in a Social Enterprise Summit hosted by the Social Enterprise Coalition for cabinet ministers. The summit also looked over the short and long-term issues and barriers that are in place at the moment, and ways in which to maximise the involvement of Social Enterprises in the recovery of the UK economy.

The mutual benefits of aligning finance with marketing

The news last week that a new business model has been devised to cultivate the relationships between finance and marketing departments UK-wide must come as a relief to professionals in both sectors.

The innovative ‘Infinity Model’ was conceived in 2005 at a Direct Marketing Association conference, where it was bemoaned that there was little cohesion between the fact-based discipline of finance and the airborne creativity of marketing.

All too often, finance departments are struggling to explain to their shareholders why so much money is invested on marketing campaigns, while being unaware themselves of the true value that their marketing team can offer…and in some cases, being unaware of what they actually do.

Dr Robert Shaw (Honorary Professor of Marketing Metrics at Cass Business School) researched over 100 organisations to compile the Return on Ideas report, supported by industry heavyweights CIMA (the Chartered Institute of Management Accountants), the Chartered Institute of Marketing and the Direct Marketing Association (where the idea started).

The fact that there are two marketing associations on board and only one finance body is somewhat reflected in the breadth of research in the report (it tends to be more focused on the integration of marketing rather than finance); however, it’s still fairly comprehensive.

Predominantly, it addresses the financial value that marketing departments indisputably add to any corporation of any size. It also provides good practice guidelines that demonstrate how creativity and ‘imagination’ (a word frequently used in the report) nurtured in marketing can be fostered by finance departments. I suppose even finance professionals will agree that you can never have too much creativity and imagination in any organisation!

Such advice seems fitting at a time when financial departments are deciding where to cut costs and are actively seeking innovative, money-making ideas to keep their corporations afloat. Instead of ignoring the value-adding acumen offered by these traditionally ‘disjointed’ sectors, it’s time to get the balance right and embrace BOTH. After all, there’s nothing like a credit crunch to get everyone banding together.

Have a read through Dr Shaw’s findings, and you might just come out of the downturn alive. Or at least with some new friends in your marketing department.