Subscribe

BlueNotes Debate: trust, sustainability & corporate culture

Issues of sustainability, trust and social licence are increasingly important across the political and business environment - as developments in the US, Britain and Australia upend long-held conventional wisdom about how it all works.

Click image to zoom Tap image to zoom

So how can organisations, government and the community reach common ground in a time where the gap appears to be widening?

"It's about winning trust and being seen to do the right thing both for customers and society."
Delia Rickard, Deputy Chair, ACCC

At the launch of ANZ’s 2016 Corporate Sustainability Review, our latest BlueNotes Debate interrogated the issues with Australian Competition and Consumer Commission Deputy Chair Delia Rickard, AGL Chief Financial Officer Brett Redman, The Smith Family Chief Executive Dr Lisa O'Brien and ANZ Chief Executive Officer Shayne Elliott.

This is an edited version of the discussion.

Cornell:  As leaders of industry, how do you interpret trust, social licence and corporate sustainability?

Rickard: I think it's a very difficult thing to tackle. I remember back in the late eighties when banks were out of favour we saw things put in place like the banking ombudsman scheme and the banking code. As a result things turned around for quite a long time.

I don't think it's as easy anymore and it has to be tackled at many layers, in terms of how you treat your clients and your relationship with society.  I think we've got this sense of the haves and have-nots, with the haves trying to rip the have-nots off.

I think it's a long way back from there and it's about winning trust and being seen to do the right thing both for customers and society.

O'Brien: When you look at the broader population, there's quite a gap between the trust those on a higher income place in organisations compared to those on a lower income.

I think there are a lot of people who want organisations to be really addressing this issue of income inequality and I think that's one of the themes that sits behind some of the recent political developments.

I think it also tells us the broader community wants its leaders and CEOs to really engage in these discussions. These things really matter to individual members of community. They want business leaders thinking beyond the bottom line.

How do we build a thriving economy and social communities where all the members of our society have access to the sorts of things they need to live a fulfilling life?

Redman: As a starting point I think trust and sustainability are quite heavily intertwined. Sustainability is often a very complicated topic. In the energy sector, how we become more sustainable is an enormously complex discussion to be had.

If we don't have trust in the community as we start to advocate for different sustainability solutions, it's very hard to be effective. You see it in the way the political agenda around the future of carbon gets caught up and increasingly difficult because community trust is quite low.

There's a lack of faith in people with the expertise to help us move the conversation forward.

ANZ HAS RELEASED ITS 2016 CORPORATE SUSTAINABILITY REVIEW, WHICH REPORTS ON HOW IT IS TACKLING ITS MOST MATERIAL SUSTAINABILITY ISSUES. BELOW IS A SELECTION OF HIGHLIGHTS.

Fair and responsible banking

  • Ranked first on the Relationship Strength Index (Institutional customers)
  • Enhanced support to vulnerable customers by training employees on empathy and identifying issues such as family violence and elder abuse
  • Improved cyber security support for customers

Social and economic participation

  • Spent almost $A90 million in community investment
  • More than 420,900 people reached through ANZ’s financial education program MoneyMinded
  • More than 113,000 hours volunteered by employees – equal to around 14,125 working days
  • 336 people employed from under-represented groups such as refugees and people with a disability

Sustainable growth

  • $A2.5 billion funded and facilitated in low carbon and sustainable solutions
  • Seventeen per cent reduction in greenhouse gas emissions in Australia
  • Greenhouse gas emissions from ANZ’s financing of electricity generation (within and outside Australia) continued to decrease and are below relevant grid average

To view a full copy of the report visit: anz.com/annualreport

Cornell: Shayne, one of the most significant initiatives you have launched at ANZ was the idea the organisation needed a broader purpose in society. Can you talk us through why you thought that was so important?

Elliott: Well, actually, I didn't launch it. It came from our people looking at how great companies thrive and survive over long periods. They came back and said, look, they've all got strategies and visions and programs and values and all those things, but one thing they all had was this sense of purpose, this higher sense of what they were achieving.

It was really a grassroots movement, if you will, within the organisation that captured the hearts and minds of people. All we've done is given it some sunlight and allowed it to kind of blossom across the organisation.

Purpose is not something you make up. It's not something you impose. It does exist and some people describe it as more like an archaeological dig.

As a bank we don't have a choice to kind of stand back and say “we're not shaping the future”. We are, and the only question is, do we want to do it consciously and in a directed way, or do we want to leave it in a more kind of random and haphazard way? We've taken a stand that we want to use it as a - you know, we want to do it in a thoughtful and future oriented way.

I don't want it to look like, we’re saying that because we’ve been in the newspapers or because there's been some parliamentary enquiries. Rather than going out and putting up posters and adverts in the newspaper, I think we should just change the way we behave and I think that will become self-evident over time.

Cornell: What is the role for a regulator in culture then?

Rickard: You can't regulate for culture. I think we've got a fairly good regulatory regime but you could have all the laws under the sun, fantastically resourced regulators but I don't think you can regulate for culture.

I think culture is something that has to be shown from the top, it has to be modelled, you have to set out very clearly the values and then you have to live those values in every aspect of your organisation.

I guess spending my life working for regulators we usually interact when corporations are doing the wrong thing. But through other associations it's so common to see big organisations which have people striving to do really good work, to serve their customers well and then other parts of the organisation which are motivated really just very much along monetary lines, undermining the good work and the group’s reputation.

We've all seen so many times, it takes one bad thing to undo years and years and years of widespread good work. I think the culture has to be lived, breathed and modelled - and you've got to keep your eye on it all the time.

Redman: There's often - there's always going to be some segments looking for ways to pull you down in a sense, or looking for a lack of authenticity in what you're doing. We think the best way to deal to it is to be quite transparent with both what's working and what's not working.

There's nothing like putting out there you've missed something or failed on something or something's not going exactly as it should, to build the credibility of the things that are working. We think that's the best way to counter this whole idea of greenwashing. In many respects, it's about forcing yourself - and sometimes this is quite hard corporately.

In a corporate, often you just want to shut down, put up the sandbags, pull down the shutters and protect the mothership, if you like. It's best to pry open the windows and let people look in, and then just accept some rooms are going to be a bit untidy, but you’re working on it.

I think authenticity and transparency are the best ways to counter challenges around greenwashing.

Rickard: We've all got an obligation to do what we can to make our societies better and to tackle the really big problems of the times.

I think about something like climate change and it comes as a huge sense of relief to me - and I think to many others - that corporate Australia is standing up and playing a role here.

Organisations are made up of individuals, so we all have our links, we all have our connections, and I think we all have a duty to care and do what we're best placed to do and help in the ways we're best placed.

Redman: I think corporates have an enormous responsibility to stay in the debate first and foremost.

You often see corporates retreat from some of the tougher discussions through fear. I think corporates have to stand out there in the public space and advocate for what they think is the right thing to do.

I think in part what corporate Australia needs to do is get behind the idea we need to be moving forward and not to get too hung up on exactly what that something is. The pursuit of the perfect is standing in the way of moving forward, and it means there are conflicting voices around the right solutions.

That allows those that don't want to move forward to hide behind what appears to be a misalignment or disagreement rather than a firm agreement we need to move. I think we are doing a good job but I think it can go even further.

O’Brien: I think if you focus on looking at how do we drive social change, what kind of outcomes over the long-term might an organisation be moving towards, I think that takes you away from the bottom line imperative that sits alongside it.

This transparency issue is really important as well. Organisations obviously want to act with integrity and be authentic in how they're talking about what's being achieved. But I think there's also an opportunity to be really open about the challenge.

There is a natural tension between being a for-profit organisation and being focused on the greater good. I don't think anyone is unaware of that. And so being transparent around the challenge this represents is probably a reasonable way to build trust and to be authentic in communications to the broader public and to stakeholders.

Andrew Cornell is managing editor at BlueNotes

The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.

editor's picks

13 Dec 2016

Phi, Friedman and the purpose of business

Andrew Cornell | Managing Editor bluenotes

Trust, purpose, social licence, corporate responsibility - no matter which business or political forum you attend, these themes are likely to be aired, if not formally then in discussions before and after.

07 Dec 2016

The benefits of being good

Andrew Cornell | Managing Editor bluenotes

Come the end-of-year festive break and the attention of senior bank executives, particularly in finance and compliance, shifts to the Swiss town of Basel and its population of regulatory gnomes who in recent years have delivered surprise presents at this time.

23 Dec 2016

Summer content stocking: Elliott, Carnegie, Gonski

Shayne Elliott, Maile Carnegie, David Gonski | Chief Executive Officer & Group Executive Digital Banking & Chairman, ANZ

Reading lists are a fixture of the holiday period and BlueNotes’ list last year, sourced from ANZ directors and senior executives, was extremely popular. But this year we thought why limit the festive list to reading?