Can profit and responsibility go together? That’s the question Sky News Business Editor Ian King asked our Panel at the latest Sky / CBI Great Business Debate event (09.12.15). Speaking to a live audience of business representatives, opinion formers and journalists, our panellists were:
- Nicholas Ferguson CBE (Sky)
- Paul Drechsler CBE (CBI)
- Lady Barbara Judge CBE (IoD)
- Mark Price (Waitrose)
- Matthew Taylor (RSA)
In a lively and interesting debate, we heard from Nick Ferguson that businesses are a core part of society, with a purpose that is similar to that of individuals – using talents, having fun and leaving the world a better place. Paul Drechsler emphasised the important role that profit can play in creating opportunity for companies to invest and spend for the benefit of society, while Lady Barbara Judge talked about the changing expectations of consumers over the last 30 years. Matthew Taylor focused on the ongoing concerns that the public have about the way business operates, including high dividends and executive pay compared to employee earnings. Mark Price completed the line-up, sharing his 30 year experience of the John Lewis Partnership and their approach to engaging employees.
Scroll down to read a full summary of what our panellists had to say or listen to the event in full here:
Nick Ferguson CBE (Sky) kicked off the debate, making the case that business is society. Businesses are a core part of society, he argued, and have an important role to play in making society better. Just like individuals, the purpose of a business is threefold: to use its talents, to have fun and ‘to put a brick in the wall’ and leave the world a slightly better place.
As Chairman of a retail business with 21 million customers, he went on to explain how Sky are living up to this purpose through making great TV, offering enjoyable careers and through a wide range of business activity and programmes that help Sky reach out to communities, from paying £3.5bn a year in tax to the Sky Academy initiatives, designed to unlock potential in young people.
Paul Drechsler CBE (CBI) opened by reinforcing the importance of profit as an opportunity for business to spend and invest for the benefit of society. Up and down the country businesses are creating jobs and opportunity for people and paying the £175bn in taxes that help fund schools and hospitals. Paul told the audience that wherever he goes, as President of the CBI, he meets firms who are doing things to make a difference.
Drawing on his passion for education and experience as Chairman of Teach First, Paul argued that organisations like Teach First could not do what they do without the support and engagement of businesses with their cause. He finished by stressing the importance of the next generation – our future employees and customers – as the people who will make the rules about what is publically acceptable for business.
Lady Barbara Judge CBE (IoD) drew on her experience in the world of business to assert that there has been progress in how we measure business success, compared to 30 years ago. Success is no longer purely benefit for shareholders, but rightly takes into account a much wider group of people such as employees and customers, she said.
Lady Barbara went onto cite the contrasting examples of Ben and Jerry’s ice cream and Gerald Ratner’s jewellery chain to demonstrate that customers like the idea of ethical business and want to trust the businesses where they spend their money. Lady Barbara finished by quoting powerful statistics from a survey of IoD members, suggesting that a third (largely small and medium sized business directors), said they didn’t know what good things big business is doing.
Matthew Taylor (RSA) said that business should not be surprised that business reputation is where it is, referring to ongoing public concerns about issues such as executive pay, living standards and the tax that businesses pay. He went on to draw on research suggesting that for businesses over 150 employees, their size means that clear communication can be tricky and good intentions of the leadership don’t always permeate through the organisation.
Matthew finished by expressing his concerns about the influence and control of some technology companies and remarking on the capacity of ‘disruptive organisations’ for mobilising large numbers people.
Mark Price (Waitrose) shared with the audience his experience of the long journey that companies have been on since he first joined the John Lewis Partnership three decades ago. Mark referred to the early 1990s warnings from Václav Havel about reliance on capitalism post-fascism and communism, and described attending courses that still taught that the purpose of a CEO was to make profit for shareholders.
Mark went on explore the relationship between employee engagement, responsible business and profits, using the example of the John Lewis Partnership. Mark said that that the John Lewis Partnership places a big focus on the happiness of the people inside the company: as a result staff are likely to stay longer and provide better service, which in turn is good for customers and good for profits.
In a varied ensuing discussion, our panellists agreed that profit and responsibility can go hand in hand. A number of themes emerged from the panel discussion and audience Q&A issues including whether businesses are too short term in their thinking, the impact of disruptive industries on the business landscape and whether CSR as we know it is giving way to businesses who embed responsibility in all their actions.
Find out more — listen to the event in full here.