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Stephen Timms MPBridging the Digital Divide: CSR and the E-Commerce Agenda |
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Lord Mayor, Lady Mayoress, Lord Lieutenant and friends. It is a privilege for me to be here today to deliver this lecture and I am grateful to Project North-East for the opportunity. I particularly welcome the opportunity because it brings together two parts of my Ministerial brief – e-commerce on the one hand and corporate social responsibility on the other. It may seem at first sight rather strange that a Ministerial portfolio around competitiveness should include Corporate Social Responsibility. But its not a mistake – the reason is the growing recognition that responsible corporate engagement with the big public policy challenges that we face in the social and environmental fields leads to benefits not just in these fields but for competitiveness too. Grappling with the challenges of improving children's IT skills or helping unemployed people find work or reducing the environmental impact of industrial processes is proving to be a big spur to innovation – and that innovation is having a big and positive impact on organisations' mainstream business success. Somebody told me recently of a senior Shell executive being asked why on earth he was spending such a lot of time talking to non-government organisations and pressure groups. And his answer was that "talking to these people I can see the future". We are not talking here about philanthropy, but about activities with serious commercial benefits, as well as social and environmental benefits too. Let me give an example of this kind of Corporate Social Responsibility in my own constituency in the East end of London, which I have been following with interest. Four weeks ago today a large new Tesco store opened in my constituency and amongst its employees are over 100 local residents who were formerly unemployed. They include a man who told me he had been unemployed for 13 years following an injury at work, another who had been jobless for eight years and a number of Asian housewives who have never worked before – never had the confidence to consider working – but who have for the past four weeks been in jobs in that store. The reason for that store making such a significant contribution to regeneration in our community is a partnership between the company, the local Council, the Employment Service, the local College and others. The Employment Service identified unemployed people who might benefit, an impressive training package was put together for delivery by the College and others and over three months this group of just over 100 people were intensively trained in using computers, dealing with customers, first aid and other topics. What was unique about it was that everybody getting through to the end of the training was guaranteed a job at the store when it opened. A young Asian man whom I did not know came in to see me at my surgery recently and asked for my help in securing a visa for his fiancée to come to the UK from India for their wedding. That was an unusual request – what usually happens is that the wedding takes place in India and an application is then made for the spouse to come to the UK. So I asked him why he wasn't getting married in India. He explained to me that was out of the question because he was only half way through his Tesco training! At the end of August I presented certificates to those who had come through the training and it was a very impressive occasion. They were proud of what they had achieved, and rightly, because by far the best way out of poverty is through employment. They were also very appreciative of the effort that had been invested in them. Now in my view that is how responsible development in disadvantaged communities like mine should be carried out, with serious effort to make sure that the employment opportunities being created are taken up by people in the area. In that case, 100 people straight off the unemployment register and directly into work. But that isn't why the company did it – they set up that partnership because its a good way to recruit staff for stores which then prove to be successful in pretty unprepossessing parts of the country. In the case of my constituency, the store is on the hugely polluted site of what was once the world's biggest gas works and it backs on to North London's principal sewage works. It is a huge site and the only thing it has been used for in the past 20 years is making Vietnam war films – Full Metal Jacket was made there because it looked so convincingly bombed out. But what Tesco has found is that the people it recruits through this approach are more committed, more enthusiastic, they respond to the trouble which has been taken to give them a chance through a real commitment to their work, which customers enjoy and which means they will stay working in the store a good deal longer than staff recruited by other more conventional routes. And I think that illustrates very well the kinds of opportunities we need to be looking for in this field of Corporate Social Responsibility. It is an approach that gets away from the old idea that economic, social and environmental goals are always in conflict. What we need to work out is how progress on any one of those fronts can support progress on the others. The approach on that store has led to gains on all three fronts, economic, social and environmental. We want to see business, the voluntary sector, and public bodies all working together, not doing so grudgingly, but because each sees it as advancing its own key interests to do so, as well as the interests of others. And everybody can see that it is in nobody's interests to have our society scared by damaging divides – our economy would never reach its full potential while large numbers of people are permanently excluded from employment, denied the skills that they need. We need everybody to be equipped to make their full contributions – to be able, as my constituents now working for Tescos have been – with the ability to exploit the new digital technologies which are such an important element in our modern economy. And their importance is growing fast. Figures published last week by the Office for National Statistics showed that last year, £18.4bn of sales were made online in the non-financial sector, representing 1% of the total – an increase in sales compared with the previous year of over 40%. It comes as a surprise to be reminded that the first time the British Government used the term 'Knowledge Economy' was three years ago. It was about the time I paid my first visit to Project North-East. I was a Minister at the Treasury and I was surprised on visiting California to see that every billboard carried a web address – as six months later they did in Britain too. Silicon Valley at the time abounded with stories like the one about the Chinese takeaway proprietor who, taking pity on the penniless dishevelled dot com entrepreneurs working in the lock up shop next door, accepted payment for their lunches in the form of shares rather than cash – and ended up a millionaire. We paid a reverential visit to the suburban garage where Hewlett and Packard had started it all by setting up their business in the 1930s – and hype was everywhere. And now, after the crash, where do we stand? Well, I believe we can see today, after all the dust has settled, that it is skills, knowledge and creativity which make the difference. There are compelling reasons for doing business electronically. Electronic links facilitate fast, effective communication, promoting the development of better business relationships, faster innovation and greater efficiency. Trading on the internet promises greater market penetration, increased customer response, more flexibility and lower costs. Better and smarter working provides competitive advantage. Small businesses can forge closer relationships with customers and suppliers. I recently presented the prizes in the e-commerce awards which are supported by the DTI through our UK Online for Business project. The overall winner for the smartness of the way it had built its business around web capabilities was a small firm in Glasgow called Global Recycling. As I presented the award to the Managing Director I asked him if any of his colleagues had come with him. His reply was "No, the other person had had to stay behind to keep the business going". There are in the Knowledge Economy immense opportunities for small and innovative firms. In the UK, the challenges facing us are clear. We need to exploit our superb science base and promote innovation to create world-class ideas, breakthrough technologies and high value businesses. I'm looking today at some great examples of that happening in the North East. Firms need to master the art of innovation. Where product lead times are becoming shorter, companies need constantly to develop and adopt the best products and practices available. Businesses need both to collaborate and to compete, to share ideas, to invest in research and development and to take informed risks. They need to take up the new digital technologies and exploit the opportunities of e-commerce. The Prime Minister has set a goal to make Britain the best place in the world to do e-commerce. Universities must become much better integrated in the economy, developing stronger links with business and commercial applications for their research. We need to help people adapt to fast-changing market and shifting work patterns so that they don't have to sacrifice their quality of life. It is the task of the government, businesses and trade unions to lead people through this process of change and to do it by working together. One of my particular responsibilities at the Department is for the development of broadband communications. We have waited a long time in the UK to see benefits from telecommunications infrastructure competition, and we were slow to make a start with broadband. But, thanks to competition between the telephone and cable networks, we now have broadband prices among the most competitive in the world, and broadband connections being sold at 20,000 per week – roughly half and half between cable modems and telephony DSL connections. Last week, we were able to celebrate the one millionth broadband connection in the UK. Project North East was quick off the mark in equipping all its sites with broadband three years ago – boosting what has developed today into a cluster of 70 new media businesses. Next month, a new Regional Broadband Unit will open for business. Working closely with the Regional Development Agencies and the Office for Government Commerce to co-ordinate public sector broadband procurement, its purpose will be to stimulate economic development and enhance the delivery of public services. The new unit will work between public and private sectors, to ensure best use is made of public sector purchasing and identify opportunities to aggregate public sector broadband demand, so maximising the potential to extend the reach of broadband services. The community will benefit from extended broadband services in a shot of important ways. Following the Chancellor's budget announcements earlier this year, we will have funding in place for a new health services communications infrastructure. It will provide a faster network access to every doctor and to all support staff, and a larger bandwidth across NHSnet gateways. The result will be better local health services. Over 20% of schools in England now have broadband connections. This figure is continuing to rise further as broadband services become more reachable. We will see more and more curriculum material online, improving the quality of teaching and learning – so that for example students will be able to follow online at their own pace courses for which there is insufficient demand in their school for a separate taught class. Nearly £50 million pounds of funding was announced recently for 64 partnership projects aimed at helping deliver better public services online. A number of them based on broadband services. Local authorities are making the most of new technologies in providing more accessible services of better quality to he public. All Britain's public libraries offer Internet access today, and around a quarter of them offer broadband access. If schools, surgeries and government offices in an area all want to connect to broadband services, then suppliers can be persuaded to install broadband locally, so widening the infrastructure support at a local community level. And it is interesting to see at the moment how local community campaigns around the country are proving effective in pressuring the suppliers to deliver broadband and marshalling the demand to make it worthwhile. I believe the strategy we are following will give everybody the opportunity to benefit from the development of the digital economy. If you go into a Jobcentre today, you will find not those awful old boards with scruffy little postcards about local jobs, but smart kiosks providing information in a much more respectful way about jobs not just locally but right across the country. Those kiosks are part of the reason why unemployment fell again last month, despite everything that is happening in the world economy, to the lowest level for nearly thirty years. That is a good example of how we can use the digital transformation of our economy to benefit those who have been on the wrong end of the rich / poor divide in the past and ensure that we do not put a new digital divide in its place. There will be many more community based benefits. Local medical centres, schools and libraries will all receive new and modern resources that the public can use. Opportunities for small scale companies and new services will provide benefits for all the community. Everyone has access to public libraries. Developments will be on a vast scale overall, but individually they will be small and local in their impact. There are many challenges in making a success of all this and we are grappling with them at the Department of Trade and Industry, but a lot of grounds for hope as well. But to be successful we need the kind of imaginative and creative partnerships which characterise Corporate Social Responsibility at this best. Shell launched the Live WIRE programme in 1982 and appointed Project North-East as UK managers for the programme in 1986. It's a Community Investment Programme that aims to support youth development and specifically to help young people (normally aged 16-30) to become interested in setting up in business, and working for themselves. I am delighted that the Internet portal which has been developed will now help local people manage change in their working lives and make informed decisions on training, education and careers, to help them develop their potential. Over 400,000 young people have been helped by the LiveWIRE programme and it has awarded over £2.8m to new business starters through its Young Entrepreneur of the Year Awards. In partnership with Shell International, this success has helped Project North-East develop similar LiveWIRE schemes in 17 other countries. And in Government we are also working to match companies to community initiatives, which promote the Internet. The UK online partnerships programme has helped develop several initiatives, including the partnership between Age Concern and Abbey National to provide Internet access for older people. So the Government's vision is to see private and public sector organisations in the UK take account of their economic, social and environmental impact, and take complementary action to address key challenges based on their core competences – locally, regionally, nationally, and internationally. I used to work in the e-commerce industry and I know there is a high level of support for businesses being run in a responsible way. The Global e-Sustainability Initiative is a good example. A group of global communications companies have formed it to improve and promote access to ICT for the benefit of human development, to gradually adopt a corporate social responsibility agenda – starting with environmental issues and to promote and support greater awareness, accountability and transparency. Initiatives such as this illustrate the positive role that the Industry can take in delivering sustainable development, rather than simply being blamed for contributing to the digital divide. I was pleased to see that the Business in the Community Initiative, MAD 4 I.T., was launched on Saturday, with more than 50 events planned to bring business skills and resources to groups which have too often been excluded from the benefits of IT, and could make great use of it, such as elderly people, disabled people, homeless people. Businesses, report that Corporate Social Responsibility can help build brand value, foster customer loyalty, motivate staff, and contribute to a good reputation among a wide range of stakeholders. And, increasingly, young people are demanding answers on these matters. The brightest young people, considering entering corporate employment, of course want to be confident that they will enjoy a rewarding career. But they also want increasingly to know if their skills will also contribute to making the world better – if they will be addressing the digital divide and the rich/poor divide which threatens our own society, and if what the impact of their work will be on dealing with poverty and equipmental damage around the world. And if corporates are to attract those young people, they have to be able to give them some convincing answers. When I started my work at DTI in May, one of the things I can across in my reading material was a remarkably prescient article from 1968 written by the American Internet pioneer JCR Licklider. Writing then about what he called the "interconnected electronic network", he said that it would prove to be a tremendous boon to mankind. But, he said, whether that potential was realised or not would depend on whether "to be online" was "a privilege or a right". The concern he raised is a pressing one today, 34 years later. And what we can see today is that we all need to work together – corporates acting in a responsible way, Government and public organisations – to ensure that access to the digital economy will not be a privilege for a few, but will be an opportunity extended to every single person in our society. And we need to work together to achieve that. Thank you. |
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Other speeches by Stephen Timms MP
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