Finance sector needs to embrace sustainability more to future-proof its business

The finance industry needs to embrace sustainability to future proof its business and to strengthen its image. Acting now to shift towards sustainability is cheaper, simpler and makes business stronger – the laggards will be the losers.

These were some of the powerful yet practical messages delivered at the first ever Finance Footprint Forum: Exploring Sustainable Corporate Services in the Financial Sector. Held in association with Morgan Stanley, the forum was the first of its kind for the sector.

It kick-started the process of creating a much-needed platform to drive forward the sustainability agenda in the finance sector. By bringing together expert speakers and panellists, such as Joan Walley, MP and Chair of the Parliamentary Environmental Audit Committee, and David Symons, Director of Environment and Energy, WSP, in a collaborative, non-competitive environment, the inaugural forum shared best practice and aimed to spark collaboration on finding solutions.

Actions

The discussion ranged from the role of government in driving change through policy and the realities for business in a climate-altered world, to effective ways to engage with your supply chain, and to manage energy and buildings use to reduce operational impacts.

Delegates, from the likes of Citibank, Credit Suisse, Carillion, KPMG, PwC, BITC, Atos, Greater London Authority, Carbon Trust, Willis Group and CBRE Norland, came away with a range of tools and talking points to start the journey towards sustainable corporate services. These included:

Lead the charge. Acting now to incorporate sustainability into business thinking and strategy saves money and strengthens business. It’s cost effective as changes can be flowed through investment cycles, and means you can make the most of current opportunities, explained Adrian Gault, Chief Economist, Committee on Climate Change. The Climate Change Act commits the UK to an 80% emission reduction by 2050, and an international agreement is coming. The policy framework is changing and businesses that start adapting now will survive and thrive.
Audits and measurements are key. Speakers such as Jon Hampson, Head of Sustainability Measurement and Reporting, PwC, and Dr Richard Swannell, Technical Director, WRAP, stressed the important of measurements in understanding where you are. This can then allow you to identify solutions.
Passion is a powerful driver. David Symons, WSP, stressed that while the business case is important, people can be just as inspired and driven by passion, vision and altruism.
Sustainable cities attract top talent. Simon Mills, Head of Sustainable Development, City of London Corporation, discussed how cities like London, New York and Frankfurt are competing for top talent. To attract multinational corporations, we need to ensure that the quality of life is as high as possible as high fliers want good transport, air quality, schools and healthcare.
Stakeholder issues come first. Jon Hampson, PwC, acknowledged the scale of the challenge for businesses starting to incorporate sustainability into their businesses. He advised starting with a focus on what matters most to your stakeholders, then building on this.
Identify your impacts. Target your approach by looking at what the key issues are for your business, and what the main issues are that you can influence, continued Jon Hampson. In financial services, often the vast majority of our impacts are in the supply chain so engage with your supplier to address them.
Follow the money. Once you understand what your sustainability issues are, look at where you are spending money, as spend = impact, agreed Phil Cumming, formerly CSR Manager, LOCOG and Net Positive Strategy, Kingfisher plc.
Buildings management matters. Tony Baldwin, Executive Director and Head of Engineering, Morgan Stanley, highlighted the need for anyone that occupies a building to look at energy consumed, resources used, and the way people are treated. He also stressed the importance of reducing impacts without impacting quality to ensure new systems were adopted and embraced.
Sustainability is at the heart of risk management. Simon Mills, City of London Corporation, argued that whilst environmental management issues such as buildings and energy use are important, sustainability thinking shouldn’t be restricted to the scope of environmental management.
Extreme weather will disrupt business. Businesses will be effected as extreme weather becomes more frequent, from the impacts of flooded transport systems to offices struggling to function during heat waves, explained Adrian Gault, Committee on Climate Change. The solution is two-fold, advised David Symonds, WSP. 1) Be prepared for a climate-altered world by checking whether your vital infrastructure could be affected, such as data centres sited in a flood zone. 2) Start reducing your emissions and impacts to help work towards limiting climate change to 2 degrees.
Small is beautiful. Transformative change is needed, but small things do make a difference and are valuable, because if everyone chips away at an issue, it will lead to big results, said Val Carter, CR Director, Aramark.
Don’t try to convert the unconvertible. Focus your energy on those who believe in what you are trying to do, advised Val Carter, Aramark, and they will convince the people around them, creating a critical mass.
Be a sustainable partner. Financial institutions, like many other industries, want to use sustainable suppliers, agreed panellists. If you want to be that supplier, develop a sustainability strategy so you can be effective, specific and realistic about how you can help clients meet their goals, rather than promising them the earth and falling short.
Integration is power. The most powerful companies are those which have integrated sustainability to transform their whole business model, argued Phil Cumming. Cumming cited Phillips and Interface as good examples of organisations who had incorporated sustainability to transform their business models, moving from selling a product (lights; carpets) to a service (lighting; carpeting).

Bang on target

‘It was a really good launch event with great discussion points and some bang on speakers,’ commented delegate Richard Hillyard, CBRE Norland. ‘The last panel opened up the corporate services debate. It’s easy to get caught up in the wider issues, in the doom and gloom, but they really talked about the nuts and bolts of what can be done.’

‘I really liked it,’ said Eirini Matsouki, Senior Sustainability Consultant, Faithful Gould, ‘In my work, we mainly focus on the environment, but it was great to bring the social and the economic aspects of sustainability into the equation – it was educational, and captured everything.

‘These aren’t the things we talk about – like the impacts of food and other elements of an organisation’s supply chain. Usually attention is focussed on the building and its function. I know the finance industry cares about sustainability issues, but it was good to see evidence of it.’

Powerful positioning

‘2015 is a key year,’ explained Joan Walley, MP, Parliamentary Environmental Audit Committee, ‘We have to stop operating in silos. The 2015 UN Climate Change talks are looming and we have to get an international agreement if we’re going avoid more than a 2-degree rise. But it’s no good having these objectives if business doesn’t do the same within their own sector and organisation. They need a mechanism, or a framework to look at the long-term goals to assess what skills and training are needed; how buildings are run; and what’s being done to reduce their carbon footprint.

‘It’s like the line in Shakespeare from Richard II – we each have to tend our own garden as well as the kingdom. Each business and each sector has to have the same regard for where we need to be to meet our sustainable development goals; and what it actually means to have a carbon budget.

‘We won’t get there unless everyone is involved and at the table, from the top tier to lowest paid. We all have a role in saying: “What does reaching 2-degrees mean?” It’s a leadership role and I think everyone has to take leadership in this.’

‘We at Morgan Stanley take sustainability very seriously,’ explained Mike Morrison, EMEA Operations Director, Corporate Services. ‘It’s a very important topic, and we are keen to play our part in environmental operations. For example, we’ve appointed sustainability champions throughout our business units and obtained Carbon Trust accreditation for the work we’ve done in reducing emissions from our UK buildings. But we are not complacent. We have a long way to go and we have as much to learn as anybody. We are pleased to host the inaugural Finance Footprint Forum event today.’

Delegate Yaser Martini, working investor, said of the event: ‘The Footprint Forum is absolutely the right thing to do and the right place to be, and I hope many more people jump on board.’

With the future events ranging from importance of identifying and tacking operational impacts to the role of responsible investment, the question is: will you be one of them?

Be part of the community setting the sustainability agenda in the finance sector. Join Footprint Forum today events@footprint-forum.com or find out more at: www.financefootprint.com

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