From Compliance to a Culture

In this weeks Executive Insight, we speak to a sustainability manager at one of Australia’s largest property firms drawing on his experience in the UK to transform CSR from a workplace compliance to a culture.

Paul Edwards was formerly the Head of Sustainability at major British property development and investment company Hammerson. Since June 2013, he has been Head of Sustainability at Australian company Mirvac, which creates, owns, and manages a diverse portfolio of assets across the office, retail, industrial and residential property sectors in Australia.

Edwards became Chairman of the Better Building Partnership in 2012. He has been a London Sustainable Development Commissioner, a Trustee of London Sustainability Exchange, and led the 2010 task force for the Green Property Alliance to create a common set of metrics for the UK property industry.

Mirvac, guided by Edwards, has recently launched a landmark sustainability plan. Pro Bono Australia News spoke to Edwards about his new challenges at the property giant as the company seeks to strengthen its ties with community and set itself apart in the CSR space.

Communicating a Milestone

Edwards says Mirvac’s sustainability plan breaks new ground for the company.

”We’ve made a commitment to be net positive,” he says. “We’ve actually stood up to everyone and said we don’t know how we’re going to do it, but we’re going to set our flag on the hill and try and get there.

“Being net positive, the creation of smart buildings, to educate one million people, and have zero waste by 2030 – they’re all really long term goals that we’re trying to achieve. We’ve set them out but haven’t actually had clear roadmaps as to how we’re going to get there. They [the roadmaps] are better now, but I think that was a really brave thing to do when we started.”

The plan, he says, stands out for its clarity of communication.

“The simplicity of the communication of our plan – I think we’re unique in what we’ve done as a company, in setting it out. I don’t think many other companies set up a plan that is as simple, clear, concise and really demonstrates the integration of social and environmental issues.

“It’s a highlight because a lot of people like sustainability strategies, but if they’re not communicated in a simple and effective way, they don’t get taken up, they just become a boring bit of strategy work.”

The plan builds on some of the company’s existing initiatives, networking and formalising previously ad-hoc projects with the community through a National Community Day.  

“We had been identifying local projects and charities near our assets and getting our own community to do work with those local communities. Now that has grown into a whole company project, where 730 people go out to 47 projects linked to 35 charities across the country,” Edwards says.

“It’s also about helping our staff.  Especially with our assets (property and construction) sometimes we’re out there engaging with people on not the best of topics, like noise – to have a relationship with those communities makes life so much better.

“We’ve been fairly selective in who we’re working with, what benefits will be achieved in those communities. We’ve been very keen on measurement afterwards, we’ve run surveys and interviews with those charities, to ensure what we’ve delivered helps them.

Although awaiting the final results of their community day benchmarking survey, I can tell you now,” Edwards says, “it’s in the 90 percent of people would want to do it again.”

Compliance and Culture

Edwards endorses the philosophy that measurement is fundamental to improvement, and that you can’t manage what you can’t measure.

The new strategy, he says, is “taking that next step of evolution in measurement – so that we as a business can value the currently unquantifiable and use that to develop new strategies, to hopefully take our business in to that next generation of leadership”.

“We do the Aon Hewitt employee engagement survey. We’ve gone from 37 per cent in 2009, then last year we hit 67 per cent as a company, which puts us in the top percentile of companies that people want to work for.

“We’ve made this dramatic shift in company culture, and things like [National] Community Day only help to improve that. It’s always difficult within a company to make sure a strategy is integrated then implemented and adhered to.”

Mirvac is in the small group of companies who link CSR to remuneration.

“One of the things we’ve done is we’ve linked the strategy to each individual department’s business plans, and that is then linked to each individual's own performances scores, which is linked to the bonus system of the company,” Edwards says. “I don’t know anyone who’s done it. It’s really good, it’s still in its infancy, this is the first financial year where it’s included. It’s really powerful in ensuring the link throughout the business.

“We want it to be part of our DNA. That’s the end goal. I compare it to health and safety. If you think about health and safety when it first came out, it was sort of tedious – now it’s a cultural thing. It’s moved from compliance to a culture.”

Clarity of strategy has also proven effective for Mirvac to resource itself internally.

“Because of the strategy, everybody has a clear direction, we can now resource accordingly to deliver it. Obviously what we find then, is you have to demonstrate the business case, and measurement is key to demonstrate the business case,” Edwards says.

“If you look at the area of waste recycling, we’ve now got a person whose sole job is to look after resource management. But she pays for herself easily because of all the fantastic initiatives being introduced we’re reducing our landfill tax burden – it’s a no brainer.”

One thing Edwards is not optimistic about moving forward is the role of Government and its potential to affect the smooth implementation of Mirvac’s strategy.

“The Government is way behind. The UK Government has a bilateral agreement on climate change. They’ve put in place initiatives that have consistency to them.  Like every Government, they change their mind…but if you look at their plan for zero carbon homes, they set three year targets, and stuck by them, through different Governments I might add,” he says.

“All business wants is consistency. We want to know that legislation is going to stay, so we can value it and put a business case to it. The same can be said for landfill tax in the UK. It’s consistently going up by the same amount each year, so you know the cost of doing nothing by looking at how many tonnes you have year on year. You can put a business case to your initiatives. In Australia you don’t have that consistency with the Federal Government.”

A Promising Future

Edwards lauds the efforts of the property sector as a whole, but concedes that some issues remain.

“You always get a spectrum. You get those companies that are leaders and want to lead, pushing forward to deliver, and you get those at the other end who don’t know how or can’t be bothered,” he says.

“I think the property sector is doing a fantastic job in a lot of ways. A lot of the bigger companies are doing some great work. I think the problems with the property sector are more in the middle tier. They might not have the access to the funds or knowledge that the bigger companies do, so it’s important that the bigger companies help the smaller companies.”

Edwards see several trends emerging in the space.  

“Shared value is one of those terms that definitely on the richter scale at the moment…I think also the need to improve engagement with communities, when you’re creating new developments and managing properties, the issue of you engage with those communities properly is becoming more prominent  – making sure you do community consultation and community engagement, taking on people’s views.

“I think another topic that is important is lifecycle, thinking more holistically about lifecycle, about how you don’t just look at a building’s operations anymore, you think about its total footprint. That’s also becoming much more prominent…and obviously, energy, water, waste, carbon, they’re core elements you’re not going to avoid.

Edwards says the next hot issue will be around biodiversity, green spaces, green places, and access to nature.

“That’s becoming much more important because people are now seeing that as linked to health and wellbeing, which is the next big thing on the horizon – how do you link health and wellbeing to places – to nature, to access to daylight, fresh air, the types of buildings you provide, toxicity in the environment. Providing space and places that actually enable people to exercise and improve their health.

“Buildings don’t use energy, people do. Buildings don’t create waste, people do. It’s about getting people engaged and making sure they’re part to the solution.”