In recent weeks the news headlines of the mainstream media have been largely occupied by the outcome of the global climate summit COP26.
In recent weeks the news headlines of the mainstream media have been largely occupied by the outcome of the global climate summit COP26. International leaders from all over the world gathered in Glasgow to discuss what action could be taken to help prevent further damage to our planet. Research was shared, negotiations took place, and ideas were developed with a view to implementing plans as quickly as possible to help cut carbon emissions. As awareness of the challenges grow, the impact of our global footprint is no longer an issue solely for world leaders to deal with. The business community must also look at all aspects of how their own industry is operating and examine in detail any negative consequences of their actions that can be mitigated going forward.
One of the key areas of interest is how a business approaches ESG (Environmental, Social and Governance). ESG is already attracting a great deal of attention, as climate change and ethical, sustainable investing become key focus points for investors and individual companies. Belvoir has always had an ESG policy, but over the past few months we have been engaged in a process to further develop the five pillars of our strategy and clearly define the most important areas for our business. As this work continues, we will be setting some ambitious targets, and working on how we can best advise franchisees within the Group to help take our ESG policy out to the wider business.
ESG stands firstly for environmental, i.e. how companies treat the planet, and from Belvoir’s point of view this can include things such as the use of electric cars, solar panels, ethical waste disposal, ensuring that franchisees deal with properties that comply with EPC standards etc. Secondly it stands for social, i.e. how companies treat people, improving employee engagement and wellbeing such as the introduction of mental health first aiders, nurturing talent through access to training and career opportunities, team building activities etc, and thirdly governance, i.e. how a company is being run. This includes concepts such as Board diversity, ethics, culture and values, regulatory compliance, responsible tax and economic contribution and above all, building trust and transparency.
When talking about ESG with franchisees at a recent national Belvoir Networking Group meeting, it became apparent that this is something that our franchisees are extremely interested in. Many franchisees are already considering ESG within their own businesses and looking at those areas they can work on and the impact and opportunities that will result from this. Lockdown provided an insight into a different way of working, including reduced car journeys through greater use of Zoom and Teams for internal, franchise and client meetings, plus home working and the success of virtual viewings etc. Franchisees and their teams also went out of their way to help support their clients through the challenges of lockdown, and this had a positive impact on the local community and helped to unite the network through shared experience. Interestingly, not only did these new working practices help to keep everyone safe during the pandemic, they also helped to improve efficiency for franchises in many areas of their businesses. I know from my own experience as CEO, that I was probably more in contact with my team on a daily basis during lockdown than ever before, and our senior management meetings via Zoom first thing every morning proved to be invaluable.
In the future, climate and ESG considerations are likely to be at the heart of mainstream investing. Customers will also eventually only choose to work with sustainable businesses who aim to give more to the environment than they take from it. It is therefore very important that the franchise world starts to understand ESG and that we go forward on this journey together. I hope that all franchisors and franchisees will give high priority to looking at their individual business models and working towards developing and updating an ESG policy that will help them to not only ensure their future survival but also help them to take advantage of the many opportunities that this is likely to bring.