Lecture three - Engaging Employees in CR and Sustainability
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Transcript of Lecture three - Engaging Employees in CR and Sustainability
Corporate Responsibility Module
Lecture Three: Employees
January 22st 2015 Lecturer: Tobias Webb
Tobiaswebb.blogspot.com
Leadership: The big picture
Simon Sinek: Why good leaders make
you feel safe
Nadine Exter, Cranfield, on Employee Engagement in Sustainability
Some useful extra reading
A study of the link between
Performance Management and Employee Engagement in Western mulLnaLonal corporaLons operaLng
across India and China
A reminder….Employees and business value: Alex Edmans
London Business School and Wharton researcher Alex Edmans Three key points to remember about the latest research on the business case for CSR:
1. Employee welfare is posi/vely related to firm value. While the idea that “companies do beRer if their workers are happier” is seemingly intuiLve, this idea is contrary to tradiLonal ways of managing workers, which holds that a dollar paid to workers is a dollar taken away from shareholders. Human resource departments are not just cost centres, but a posiLve source of value creaLon.
Employees and business value: Alex Edmans
2. CSR can improve firm value. TradiLonal thought is that considering other stakeholders (e.g. employees, customers, the environment) is at the expense of shareholders. Thus, socially responsible invesLng should underperform tradiLonal invesLng, since responsible companies are distracted from the boRom line. His paper suggests that there need be no tension between CSR and profit.
3. The market does not fully value intangibles such as stakeholder capital. Results suggest that the market doesn’t immediately recognise the benefits of stakeholder capital. As a result, we need to move beyond evaluaLng managers according to short-‐term performance to encourage them to consider the long-‐run health of their firms – and society.
Academic research findings
Employee Engagement and CSR: TRANSACTIONAL, RELATIONAL, AND DEVELOPMENTAL APPROACHES
Philip Mirvis
Evident from surveys says (1)
• Three out of four of the Millennial GeneraLon (born 1978-‐1998) want to work for a company that “cares about how it impacts and contributes to society.”
• Among those already in the workforce, nearly seven in ten say that they are aware of their employer’s commitment to social/environmental causes.
• 65 percent say that their employer’s social/environmental acLviLes make them feel loyal to their company.
Evident from surveys says (2) Sirota Survey Intelligence, of 1.6 million employees in seventy companies, found that:
• Employees who approved of their company’s commitments to social responsibility, compared to those who did not approve were:
• Far more engaged on their jobs. • More apt to believe that their employers were interested in their well-‐being.
• They also had more favorable percepLons of their management’s integrity and rated their companies as more compeLLve, too.
Evident from surveys says (3) • A 2007 Towers Perrin survey of 90,000 employees in 18 countries found that only 21 percent reported being fully engaged on the job.
• The rest were either simply enrolled (41%),disenchanted (30%), or disconnected (8%).
• In turn, the Gallup Employee Engagement Index reported that, on average as of 2010, some 33 percent of employees were engaged by their companies, 49 percent were not engaged, and 18 percent were acLvely disengaged.
Mirvis (2012) explores three different ways that companies design and manage their efforts:
1. A transac/onal approach, where programs are undertaken
to meet the needs and interests of those employees who want to take part in the socially responsible efforts of a company.
2. A rela/onal approach, where an organizaLon and its employees together make a commitment to social responsibility; and
3. A developmental approach, where a company aims to more fully acLvate and develop its employees and the firm to produce greater value for business and society.
So, what’s the problem
• On the surface, engagement in CSR/CR/Sustainability makes perfect business sense;
• Studies prove it. • Surveys prove it. • So why don’t more companies do it well?
So why don’t more companies engage employees well on CR/Sustainability?
• Many do: But they tend to be the largest ones, such as PUMA, Mars, Alliance Boots, IBM etc.
• OR they are smaller, mission driven firms such as Patagonia, Interface, etc.
• There are lot of companies that are not in the global leadership group nor who are mission driven on sustainability and CR.
• Probably tens of thousands of them globally.
These companies struggle with employee engagement in CR because:
• They think it’s expensive, and some of it is (supply chain changes, product changes or system changes generally).
• They don’t tradiLonally value Human Resources as strategic so don’t hire the right people and apply the right resources.
• They don’t really believe the numbers, and think a more tradiLonal business approach is best.
• So iniLaLves like this in a company like this are sLll rare.
• Company grown by merger since 2006.
• From Boots to Alliance Boots now merged with Walgreens.
• Company in Europe has appointed 40 (approx) CSR Champions.
• Based all over Europe. Idea is they are there to catalyse change in the business.
• Engaging senior execuLves, other employees on issues from energy efficiency to social innovaLon.
• Board members have personal tasks/targets on CSR and sustainable business.
• Employee champions also promote Alliance Boots' work with anL-‐cancer network EORTC.
• Trained by interacLve video, presentaLons, workshops. Graded on a pass/fail basis as part of their annual assessments.
• Company also communicates their targets, policies, and work using company intranet, to store managers and other employees.
• Board of the company has CSR CommiRee which meets quarterly to review progress.
• Aiming to roll out basic video training on "What CSR means to us" across the whole company.
Employees and CR
Case Study: Accenture
Gib Bulloch from Accenture on ADP
Accenture: “Human Capital Strategy”
• 246,000 employees. • 35% female -‐ 17% of Senior
ExecuLves. • Big picture short term
focus: equipping 250,000 people with skills to get a job or build a business. Claim 162,000 achieved so far.
How?
• Via: cash and in kind support "equivalent to $44.5 million" from $25 billion turnover.
• Target of $100m by 2013. • Training and capacity
building with NGOs: InternaLonal FederaLon of Red Cross/Red Crescent.
What does this mean in pracLce?
• DonaLons. • In-‐kind consulLng. • "Train the trainer" Lme
donaLons with NGOs to support/empower vulnerable people.
Junior Achievement Young Enterprise
• Encouraging student business.
• Award and donaLons. • Encouraging Workplace and
Entrepreneurial Skills. • 18,000 students by 2012,
esLmate that 15% will become entrepreneurs by 2016-‐18.
Big on donaLons, short on exact detail…
• Also support Save the Children and Plan InternaLonal with donaLons.
• Claim 59% of contribu/ons are in kind (unclear on detail).
• Strategies regionally and locally adapted: different approaches per country needs.
Employee Engagement Methods
A mulL-‐channel approach: • Company Intranet • eLearning programmes • Volunteering/skills
matching • Employee surveys • Local/small group meeLngs • CR/Sustainability
Champions
Accenture Development Partners
"Corporate Social Enterprise" • Non profit model helps
employees make a difference in development via paid secondments to NGOs around the world.
• Two-‐way innova/on model: Ideas for clients and help for NGOs etc.
Accenture Development Partners
• A “key vehicle” for driving sustainability experience into graduate hires.
• 3-‐12 month physical placement on a project with an NGO or development partner in a developing economy.
Accenture Development Partners
• Seen as a “game changer” for parLcipants in terms of experience, career, benefits.
• Rigourous selecLon process.
• Accenture offers support, project evaluaLon and a peer community to parLcipants.
• Valuable for clients + company.
Accenture: Conclusions/Acknowledged areas of improvement
• Online tool to streamline access and registraLon for community events and track volunteer hours.
• Even a technology company struggles with measurement and data collec/on… key challenge.
• A good example of current beLer prac/ce in services industry…
Employees and CR
Case Study: Linklaters
Linklaters: A global law firm
5000 employees/partners Four Pronged Approach: 1. Trusted Advisor 2. Valued Colleague 3. Engaged Professional 4. Good Neighbour
Linklaters: Progressive for their sector?
• Recognise role/responsibili/es as "trusted advisor" and "voice in global business”.
• Global Engagement Survey • Includes "global
responsibility strategy" from 2011.
• Anonymous partner feedback mechanism for employees.
Embedding CR?
• Partners have employee development KPI's built into partner performance expectaLons.
• 17% female partners: "we clearly have much to do”.
• Clearly realise diversity is a challenge: Weaker on acLon…
"Women's Leadership Programme"
• Provides learning, coaching and mentoring to 24 managing associates over six months.
• Gited comprehensive data protecLon training to Save the Children.
• Wellbeing assistance service.
Learn for Work Programme
• 18 offices: "hundreds of volunteers enthusing" 9000 young people about world of work, careers, sharing skills.
• 57 university scholarships in China.
• Learning resources on dealing with stress.
• Recent flexible working pilot successful.
• Sponsored "Good Governance in Interna/onal Development" conference in 2012. ObjecLve of helping employees assist in int. development outcomes.
Linklaters: State of the art on employee engagement?
• They are clear how non core legal work maRers given global markets, challenges & socieLes. E.g. Charity trustee work, research, policy commiRees, teaching etc.
• Focus on skills matched volunteering in communiLes and with chariLes.
Going a bit beyond the usual…?
• Created Italian network for women in business. 400 members in two years.
• Support legal advice clinics in Hong Kong, London, Paris and Warsaw.
• "CommunityMark" award from BITC in 2012.
Unfinished measurement…
• Use World Environment Day & issue of sustainable food sourcing to engage colleagues.
• 25% volunteering rate with 75% skills matching. Further incremental targets set.
• Community impact reporLng lacking but is a target.
Much more to be done…
• Some targets weak: "collaborate with clients" on Living Wage.
• Retaining talented women. • Individual partner plans to
embed ethics / values / diversity and measurement of that.
Conclusions: Linklaters
• Making good gradual progress.
• Overall measurement of CR parLcipaLon a significant challenge.
• No visible stakeholder engagement beyond charity/volunteering/events.
• No menLon of an ethics commiLee with/without external viewpoints.
• No external feedback mechanism.
• But level with, or ahead of peers in their sector globally.