Janet Blake, head of global corporate social responsibility (CSR) at BT, reckons CSR is delivering real and measurable financial value for the telco giant. In an exclusive interview with GBN she explains how the company measures the impact of its CSR work, details BT's plans to reinforce its position as a green business leader, and argues that the government must do more to help firms tackle climate change.
GBN: Why is CSR important to BT?
Janet Blake: BT has transformed as a company over the last ten years and service is very much key to our marketshare. As a service company brand, reputation, values and image are essential to our success and CSR activities help in all these areas.
But can you make a firm business case for CSR?
We believe there is a clear a business case for CSR – and there has to be because you have to ask if any form of investment you make is the right thing to do for the business and its shareholders. We've done a lot of work to make the case for our CSR investments. The main point is that it is good for the bottom line. We tracked new business and evaluated the proportion that is CSR driven. We found that £2.2bn of revenue a year had CSR credentials.
How did you come to that figure?
We looked at the value of our deals then identified the value the customer put on the CSR record of its suppliers. This assessment backs up the nice words about CSR, quantifies the value people place on it and highlights the business we could lose if we didn't have these initiatives. You do need to quantify it – we spent £21m on charitable efforts last year and if you are spending that kind of money a business needs to be it is getting a return.
What other benefits do you see from CSR?
Another big benefit is the cost savings we gain from environmental initiatives. We've saved £290m from improving energy efficiency and reformatting the way our staff work. We now have 11,000 home workers and a further 64,000 flexible workers who work from home some of the time. As a result we've been able to cut back on office real estate and reduced our business travel budget. Another benefit is in customer satisfaction, which as a service firm is critical to our competitiveness. We've looked at the proportion of a purchasing decision that comes down to reputation and the proportion CSR efforts contribute to our reputation. We've used customer panels and surveys to estimate that a 10 percent increase in customer awareness of CSR leads to a 1 percent increase in overall customer satisfaction.
Should firms have a separate CSR department or should CSR activities be embedded into everything they do?
It is a pertinent question. Long term CSR can’t be done as a single department running alongside day to day operations. It has to be embedded and for that to happen you need senior executives willing to push the agenda. Our CEO, Ben Verwaayen, has been very vocal about his support for our CSR initiatives and that really helps. However, at a practical level it helps to have CSR activities under one banner. If you are managing change in any business you need targets and specific objectives if you want that change delivered and having a department responsible for that change makes it easier to drive forward.
Why do you think firms have suddenly started taking a bigger interest in environmental issues?
For business managers the agenda has shifted from the environment to climate change. The environment is quite a passive concept, people feel they need to do their bit, but there is no burning platform for the issue. Climate change has provided that burning platform and forced itself up the agenda. The science is better understood by businesses while publicity, like the Al Gore film, has meant that people are getting it. It is focusing people's minds on the steps that can be taken. The challenge now is to keep this platform alive because it is the best way of driving change.
What efforts have BT made to become greener?
Ten years ago the environment was about complying with regulations but not doing anything radical, but in 2003 we looked at the issues we were facing and decided to do something radical. In 2004 we signed the world's largest renewable energy deal with npower and British Gas. That means all our exchanges, satellite networks and offices are powered by renewable energy.
Didn't that drive up costs?
It actually worked out cheaper for us. It was a good deal for BT. Now it is not so lucrative, but because we moved first we got a good deal.
What other steps have you taken?
Next we ramped up our agile working initiative. We have replaced three quarters of meetings with virtual meetings, which have eradicated 1.5m journeys a year. That equates to 55,000 tonnes of CO2 and has saved us £120m a year in travel, accommodation and lost productivity.
Where BT take its green agenda next?
We have just decided on three CSR priorities for the future: climate change, sustainable economic development and social inclusion. With climate change we want to take another radical step and make a bigger impact by changing some of the things that are intrinsic to the way we do business. We will make more detailed announcements in January, but one of the main focuses is on making our new 21st century network as environmentally friendly as possible. We are also working on our datacenters to ensure they are up to the latest environmental specs. Thirdly, we will look at how to make our whole product set more environmentally sustainable. One thing we want to do is work out the CO2 emissions of our product set and let our customers know what it is. We see that as helping to secure business because as our customers get more carbon aware having that data will help them better manage their carbon footprint.
Is there the customer interest to justify these investments?
Look at Innocent Smoothies. People will pay more for something that they perceive as better. It is consumer power that will ultimately drive these green business models. I think we need a few big wins to make that apparent to everyone, but I believe we will see widespread increase in the value placed on firms' environmental record.
BT is a member of the Corporate Leaders Group on Climate Change and signed the letter earlier this year urging the government to do more to tackle the problem. What would you like to see the government do?
The government has taken some positive steps, but there is room for improvement. Governments can do more and none of them are really taking a leadership position. Overall, I believe it is market forces that will do the most to drive change in business models, but the government has to put in place a better framework to enable change. Of course there needs to be basic legislation, but I’d also like to see incentives that find ways of awarding those companies that get it right and make investments in green business models.
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