Stephen Timms MP

Business in the Community

And there is a lot of enthusiasm around Britain today, recognising that corporate social responsibility is a source for business success and sharper competitiveness in the modern economy, as well as a source of social progress. This is not about philanthropy. It is about hardheaded business success. One of the reasons is that people want to work for companies which are doing good as well as doing well - it is no accident that our hosts today, Asda, have featured consistently in the top 10 of the Sunday Times list of the best companies to work for, as voted for by the employees themselves. People want to be able to feel proud of the organisation they work for - to feel their employer is part of the solution rather than contributing to the problems. Companies who want to employ the most able people have to be able to give them good answers on CSR, otherwise they'll go and work for someone else.

We have recently published our strategy at the DTI for driving up UK competitiveness, based on the five key drivers we have identified - investment, innovation, skills, enterprise and competition. And we have made clear that we see widespread practice of CSR as an important element in the successful mix - as a key ingredient in making the most of the unprecedented economic opportunity that stands ahead of us in Britain.

Let me tell you about one company I know. Happy Computers is a computer training company with 40 staff. They aim to donate the equivalent of 20% of profits (in cash, gifts-in-kind and volunteering) to the community. They have, for example, what they call a Voluntary Day scheme, allowing employees to volunteer one day a month, fully paid, for a charity of their choice; and a 'Timebank' scheme under which 100 person days is made available. Any employee can apply to draw from the Timebank for a project that has 'mutual benefit' for the company and the community.

In one Timebank project, Happy Computers partnered with the Pan African Development, Education and Advocacy Programme IT Community Training Centre in Kampala, Uganda. The aim was, not just to provide training, but also to leave behind a training centre with increased capacity, higher levels of staff skill and confidence and additional training materials.

Now some people would feel that Happy Computers is over the top. But it is a successful business. It never has to advertise its vacancies but instead has a database of people wanting to come and work for it. Staff turnover is almost nil. All those are great commercial strengths for a company to enjoy. And there are some important clues in that example about why this is an important topic for us at the Department of Trade and Industry, with our commitment to making the UK more competitive and more productive.

Helping young unemployed people back into work - with low levels of unemployment today we need those young people making a contribution in our factories and offices, and that's what they want too. Helping improve reading as we have heard "Right to Read" to raise standards of education, headteacher mentoring to tackle poverty in the UK and overseas - working to protect the environment and to combat the threat of climate change. Supporting community organisations as ProHelp is doing. In all those areas, the modern CSR movement is one of the best allies we have in Government for bringing about the kind of changes we need.

There is really inspirational pioneering and exploration going on in corporate social responsibility - it is great wonderful ferment of enthusiasm and innovation. And what we need together to be looking for is how we can get past the old idea that economic, social and environmental goals are always and inevitably in conflict with each other. We need new ways in which we can make progress on all three of those fronts - economic, social and environmental - together and at the same time. We need new partnerships with businesses, Government agencies and community organisations working together - not grudgingly, but enthusiastically, because each can see its own key interests being advanced, as well as the interests of others.

Earlier this year, I joined Business in the Community to present the Awards for Excellence. One of the winners was Elite Forwarders that provides garment warehouse and distribution services for some of the country's major retailers. They received the Neighbourhood Renewal award. The background was that, when Elite was expanding its operation, it worked together with West Leeds Family Learning and Jobcentre Plus to target recruitment in the local community and particularly among people who were unemployed. The deal was that local people were trained and offered a job conditional simply upon their satisfactory completion of the training programme. Of the 300 new staff, 106 were recruited through that programme. And nearly half of them had previously been unemployed for over 12 months. Now that is great news for those people and for their families, and for the community in West Leeds. But the company has gained through recruiting a local workforce with the right skills and extra commitment - because people respond very positively to an employer who takes more trouble on their behalf.

I want to see corporate responsibility increasingly as part of the British brand overseas - for people around the world to be pleased when they hear that a British company is involved in their community, because they will know that CSR will be part of how that company will work. And we are, increasingly, being seen as Leaders worldwide in the push for higher standards of corporate responsibility - this month I shall be visiting Italy and Norway to talk about what is happening in the UK. Business in the Community has done a great job bringing about a culture change in UK companies which I believe is vital for future UK competitiveness - last year I shared a platform with Business in the Community in Japan about CSR, a few months ago Peter Davies and I shared a platform in Rome, and I have been invited back to Japan to talk about progress in the UK early in the New Year.
But not every company has yet been persuaded. I notice from time to time that not every journalist has been either. Some will argue that CSR practices will inevitably involve greater expense and distract them from the tough job of running a profitable company. So we need to do more to demonstrate the business case - and build on the impressive work by companies like BT and the Co-operative Bank who have produced data to substantiate the business benefits they derive from their CSR programmes.

Pam mentioned Accountability's work looking beyond individual company benefit to effects on the regional and national economy. DTI hosted the Accountability conference last month on Responsible Competitiveness and I believe that work has made a very promising start. Earlier in the year, we hosted a workshop with Forum for the Future bringing together businesses, policy thinkers and non governmental organisations to explore business performance, seen through the different lenses of competitiveness, productivity and the increasingly importance of intangible assets, as well as sustainability and CSR. The broad conclusion was that CSR and a focus on sustainability do make a positive contribution to business success. The key is to look on these activities as an investment in a strategic asset or a distinctive capability rather than as an expense. And this is the message we need to get across - that this is about long-term success.

CSR is for small businesses as well as large ones, as vast numbers of SMEs already know, even if they don't use the term itself. They understand very well the advantages of close involvement in their local community. They account for half of business employment and turnover in the UK, so we need them to be making a full contribution. BiTC's Communitymark is helping to address this need and I warmly congratulate those who have received one this morning. DTI is also sponsoring the Small Business consortium, which is working on a practical programme of support for SMEs looking to improve their competitiveness by addressing their social and environmental impacts.

The Corporate Challenge, recently launched by the Treasury and Home Office, demonstrates the commitment right across Government to work with the corporate sector to facilitate this type of involvement, rather than looking to regulatory measures or new laws. The Corporate Challenge, and the associated network of champions, aims to increase corporate support for employee giving and volunteering. The champions will work with Government to help spread best practice and collaboration between companies, in order to increase the impact of involvement across business as a whole.

I know that many companies within this region are already taking up this challenge through Yorkshire Cares. And I'm sure you will know from your own experience that volunteering is not a one way street - as well as offering time, expertise and money, businesses have a lot to gain through a stronger relationship with the community and voluntary groups - better reputation, higher local profile, greater staff motivation, and the development of new skills and a fresh perspective on the part of the volunteers.

I am the Energy Minister at the DTI, responsible for our work on sustainable development, so I was particularly pleased to hear about the 142 companies in the regional Business in Environment index and the Green Business Support Project. We have set ourselves challenging goals to improve our energy efficiency and to minimise waste through resource productivity - getting more from less to reduce our impact on the environment. I am particularly keen that we should help businesses develop and exploit greener technologies and business models.

In September we published our Framework for Sustainable Consumption and Production setting out the progress so far and the challenges that remain if we are successfully to decouple growth in the economy from growth of environmental degradation. In taking forward the ideas in that framework, we will be working with specific sectors to identify the barriers to sustainable consumption and production, and work out how we can address them. We are starting here in this region, focusing on the glass sector with a partnership with British Glass. But this is a major challenge for all of us.

And as I saw when I spent the week before last visiting renewable energy developments across the country, from Lynmouth in Devon to Kirkcaldy in Fife, the switch to greener business is creating a huge new raft of business opportunities. We need to be ahead of the game here to maximise the commercial benefits for UK companies in the years ahead, as tackling climate change becomes an increasingly pressing global priority.

CSR needs to be part and parcel of the way business operates - from strategy through to day-to-day operations. For that to happen, it needs to become better understood and more widespread. That will demand a wide understanding across the business - it cannot be the responsibility of just one person or one department. To help achieve that mainstreaming of CSR into business practice, together with the Corporate Responsibility Group, I commissioned last year a report to look at how we could best identify and develop the skills needed for effective CSR.

Among its conclusions was to recommend:"the setting up of a CSR Academy to support the growth of CSR competencies at the heart of education, training and on-going development of both specialist and general managers". The report called for this Academy to contribute to Government strategy for the promotion of CSR - including for UK companies operating internationally. It drew attention to the need to serve small organizations as well as large, and recommended that it should be "new and independent" and have a small core staff.

I have now set up a Steering Group to take forward that recommendation, with a view to its implementation by next summer. I was delighted that Clive Mather, the Chairman of Shell UK has agreed to act as chair. The Group also includes representatives of SMEs, the voluntary sector and non-governmental organisations. Peter Davies is also a member, bringing the expertise of Business in the Community to the Group. It is exploring how we can best make a contribution which will have an impact in embedding CSR in business practice, and how we might complement and support the work of existing organisations. I look forward to meeting with the Group in the coming month to hear about progress.

I am delighted with the enthusiasm and the commitment I have been able to witness here today. The partnerships we are celebrating have the potential to make big inroads with our social and our environmental challenges - the toughest challenges that the world is facing - but the potential also to deliver new insights, new business ideas, new products and processes to build business success. It is a great opportunity - and we all need to be working together to make the most of it.

Thank you very much.