November 30, 2015

Social issues for business and in supply chains

Tobias Webb, Founder & MD, Innovation Forum

•  Not many companies mean to have negative influences

•  Generally it happens by accident

•  Companies don’t think about impact and consequences of actions

•  Bad systems, short term thinking and poor institutions mean incentives are often wrong

A key point to remember

Social & Environmental are linked: Deforestation is linked with the spread of Ebola

Companies HAVE to collaborate: Bangladesh & working conditions

Don’t forget bribery: Business contributions to fighting corruption

Climate change in many places driven by social issues

So how are some companies trying to respond to this?

•  Policy development via stakeholder engagement

•  Policy implementation and target setting

•  Supplier and business partner engagement

•  Investor and campaign group conversations

•  Seeking benchmarks with peers

•  Tuning ‘risk radar’ to upcoming issues

•  Embedding new practices into the business: i.e. inclusive business

Pulp & Paper, Palm Oil & zero deforestation

The Bangladesh Accord of brands, focusing on structural integrity

Business alliances against corruption

Companies leading the way to tackle climate change

Tackling poverty via inclusive business

Seven reasons to take action:

1) Reputation risk management2) Access to new markets and customers 3) Supply security4) Customer retention 5) Moral imperatives, living their values6) Employee recruitment, retention and motivation 7) Investor and campaign group pressure License to Operate (political and social)

So, what does the future look like?

•  Global environment under pressure (50% of species lost in last 50 years)

•  Rising population & consumer demands (9 billion by 2050)

•  Political & economic volatility

•  Increased transparency and perhaps regulation

•  Pressure to tackle risks – and seize innovation opportunities

•  Final point: Innovation in design, process, management and engagement will be KEY to better management and business success in the long term!

More specific ‘social’ trends

•  Inclusive business, community empowerment, living wages, gender equality, local content, and human rights all becoming increasingly relevant for big companies, even those without a traditionally large social footprint, ie Interface

•  UN Guiding Principles on Business and Human Rights increasingly seen as The Tool for companies to show they are making progress

•  ‘Social footprinting’ and the measurement of social impacts is incredibly difficult due to lack of investment by business, competing or narrow academic methodologies and lack of a common language around measurement

•  Yet reporting requirements around transparency and most basic areas, ie human slavery and trafficking are now very high on the business agenda

More specific ‘social’ trends

•  Requirement and expectations around reporting and transparency will only grow

•  The COP 21 negotiations are highly significant and much of the implementation will depend on social progress. I.e. cutting emissions by cutting corruption

•  The 17 Sustainable Development Goals agreed on by all nations are being used as a social and environmental framework by business, but are both broad and ambitious

•  Companies will use these, and other tools, to increasingly ‘prove’ their social value AND deliver innovation, new products, access to markets, money and talent

tobias.webb@innovation-forum.co.uk

www.innovation-forum.co.uk

Check out the Smarter Business blog at: hhttp://sustainablesmartbusiness.com

Thanks, and contact details:Tobias Webb

Founder and Managing DirectorInnovation Forum