Link: Corporate social reporting – Good for the environment
Remember the scene in Mary Poppins where she walks into a nursery and turns chaos into order with a click of her fingers? In a nutshell, that’s Gaynor Coley’s desire – to turn chaos into calm. ‘Wouldn’t it be wonderful if you could just do that? The common sense of life is brought to bear,’ she muses.
Indeed her heroine is Mary Poppins. Perhaps an unusual choice for an extremely practical woman with her feet firmly on the ground.
But a stroll around the now-famous, St. Austell-based Eden Project gives you the feeling its development director, Coley, has already contributed to restoring calm where they was once chaos.
Admittedly, it may not have been achieved with a click of her fingers.
More like hard graft and determination. But nonetheless a sense of calm reigns in Eden.
Until the late 1990s the valley in which the Eden Project sits was an industrial scar, the product of a china clay pit that once provided a vital source of employment for the area.
Now the giant biomes, designed to replicate climates around the world and home to the majority of the Eden Project’s exotic plants, have transformed the site into an internationally acclaimed tourist destination.
The all-year round spectacle marks a much-needed shift from the seasonality that plagues Cornish tourism.
Deloitte-trained Coley joined the Eden team back in 1997 when it was still a seed waiting to be planted by creator Tim Smit. By 1998 she had been promoted to finance director, tasked with turning £300,000 worth of millennium funding into a constant flow of cash to ensure the project came in on time and to budget.
Public pressure was intense, given that it was taxpayers’ money that was funding the project. It was a rough ride initially, admits Coley, but one that has paid endless dividends.
She says that the team’s ability to be forthright and transparent was probably their saving grace. At one point when it looked like the whole project was about to go down the pan, they turned to some of their backers for help. And against public perceptions of big business, McAlpine, the main contractor, and NatWest sat and listened.
‘We called it the country dance,’ she says. ‘If they were sat around the table with us then they must have wanted to dance.’ Although McAlpine did suggest that ‘it’d be cheaper if we built it square’.
Within the four months of opening the project was pulling in 750,000 visitors – its annual target. By August 2001 the three giant biomes welcomed their 900,000th visitor since opening to critical acclaim in March 2001.Today it boasts the accolade of Cornwall’s biggest tourist attraction.
Prior to Eden, Coley had spent five years as finance director of Plymouth University.She admits most of her friends and colleagues were surprised when she announced her plans to jump ship to join a non-existent project.
Her motivation for the move, she says, was the ‘absolutely inspirational and professional people’ she met. And, of course, the chance to take a risk – an attribute not usually associated with chartered accountants.
‘I thought if I don’t do it now, I’ll never take that kind of a risk again,’ she explains. Although with success behind her, she confides: ‘I might again now.’
The lure to Eden was a similar experience for the project’s current finance director Peter Cox, who turned his back on a partnership in Ernst & Young’s corporate finance division for much the same reasons. ‘I wanted a change; to do something with my life,’ says Cox.
Within three years, Coley had stepped up to the role of managing director.
‘I was in charge during that first summer. We were paddling like ducks. Things looked smooth on the surface, but below the water everyone was paddling like hell,’ she remembers.
Was she daunted by the prospect of managing the whole project instead of just the purse strings? No, she says: ‘The things the finance professional brings with them to the MD role is an essential framework, structure and clarity of objective.’
The one thing she did grapple with was the question of when to allow creativity to take precedence over finance matters.’As a profession, one of the things we aren’t trained in is when to allow creativity to flourish and not to have predicted and predictable outcomes. Finance people can provide the discipline for creativity but don’t expect it to be predictable,’ she urges.
Last year, Coley made yet another career change that surprised friends and colleagues and defies all the unwritten rules of the finance professional.
She stepped down from MD to become Eden’s development director.
It is here that her passion and financial acumen really come into play.
‘People were puzzled by my sidestep. For me it was about trying to find a bit more freedom for good ideas,’ she says.
Right from the start the Eden team have followed strict social, environmental and ethical principles from employment and materials’ sourcing to using local businesses and transport.
‘Balancing the books as well as meeting social obligations – it’s an interesting challenge,’ says Cox. ‘It’s easier to run the business just for profit.’
Coley now wants to use that philosophy as a basis for Eden’s sustainable development as a viable business. ‘We can all dream and think that the world can be a better place, but unless people have ways of taking practical steps, then it remains just a dream.
‘We want to say you don’t have to compromise cost and environmental and social issues when buying. We want customers to understand the trade-off between prices and other issues and for them to exercise what we call the power of their wallet,’ explains Coley.
She is working with existing suppliers to identify products that have been successful in the destination – that is the insiders’ word for the Eden project – and can be sold externally.
‘It’s using the brand to share with the right companies who have sustainable business at the heart of their agenda to start making a real difference out there,’ says Coley.
More and more consumers are indeed buying with their conscience. In February, Cafe Direct, the UK’s largest Fairtrade drinks company, launched a public shares issue with Triodos Bank.
And it’s not just the right-on, hippie crowd either that are backing these principles.
The Pensions Investment Research Consultants last month warned that companies that fail to embrace corporate social responsibility issues risk investor rebellion.
The day after PIRC’s warning, the Association of British Insurers told companies that shareholders would pile pressure on those companies that fail to disclose social, ethical and environmental risks to their business.
It welcomed an announcement by Henderson Global Investors, the fund manager, that it would consider non-financial risk management information when deciding how to vote on a company’s report and accounts.
Coley believes this is an arena in which accountants can play an important role. ‘It’s about taking the skills that we have – numeracy, understanding of business and cash – and making it work for ordinary people.
‘But the problem with modern corporate society is that it is an either/or. Either you sacrifice your own salary and work for a charitable organisation or take time off to do some charitable work and fund that by doing your normal day job, or you don’t do it.
‘Part of what we’re working on is introducing that balance into the business workplace. It’s not about having brown rice and knitted business plans. It’s about having real commercial acumen and a drive to find long-term solutions,’ she urges.
In the meantime her next challenge is to raise £40m over the next two years to build the last biome that will tell the story of the dry, arid regions of the world and how important water is for plants and human life.
Coley might not have Mary Poppins’ carpet bag – a bottomless source of practical objects – but she does have a loyal, dedicated staff, understanding backers and a society increasingly concerned about the state of the environment.
GOOD FOR THE ENVIRONMENT
Due to growing investor and stakeholder demands, many companies include corporate social environmental information in their annual report and accounts. Soon this will become mandatory.
The Department of Trade and Industry is due to publish guidelines on the operating and financial review soon. Sources say it could happen in the next few weeks, but the DTI says has no firm date. It follows the DTI launch of the OFR working group consultation on materiality last year.
When they are eventually published, the guidelines will mean companies of public interest will have to disclose any social, environmental issues that affect the business.
The OFR aims to encourage businesses to provide additional information that goes beyond the balance sheet and cashflow statements. But it will be up to directors to decide what information is material to their business.
The UK is way ahead in this field of reporting. The OFR has existed for more than 10 years in the UK on a voluntary basis, although market pressure has made it all but mandatory.
As part of the government’s review of company law – still uncompleted after seven years – the steering group recommended that the OFR be enshrined in law.
Updated guidance published by the Accounting Standards Board last year recommends that the OFR should ‘highlight accounting policies which are key to an understanding of the performance and financial position, focusing on those to which the results are particularly sensitive’.
Following the growing use of ‘proforma’ figures, it also recommends that ‘where information from the financial statements has been adjusted for inclusion in the OFR, that fact should be highlighted and a reconciliation provided’.