How to be change-proof

While telecoms group BT has had its ups and downs in business, its excellent environmental management performance has been maintained. Tom Idle met group head of environment, Mike Hughes

BT’s not a Johnny-come-lately in the environmental game, Mike Hughes tells me. And he’s certainly got a point.

The BT Group, for which Hughes heads up the environment team, provides communications solutions to customers throughout the world. It has been developing its environmental management system since the early nineties – and been registered to ISO 14001 since 1999. And it’s this environmental management performance that has played a huge role in making the firm what it is today.

“Something that has been fundamental to the things we’ve done has been developing a business case to prove that what’s good for the environment is also good for the company commercially,” says Hughes.

His environment team, part of a larger corporate social responsibility unit within BT, offers support to internal departments bidding for new business. And BT’s environmental credentials are now worth somewhere in the region of £3B a year.

“That’s something we’ve seen grow over the years,” he says. “We’re seeing an increasing number of contracts requiring us to be able to say, for instance, that we have ISO 14001 accreditation. In a lot of instances, if you don’t have it, it’s a non-starter.”

BT’s ISO registration was probably one of the biggest of its kind in the world. With around 6,000 buildings in the UK alone, it was unfeasible to certify each site, so a more innovative approach had to be taken. “We developed an approach that saw us concentrate on our key environmental impacts,” says Hughes.

Research threw up 150 key impacts (“things like emissions to air and waste – the normal candidates”) and these were collated into a number of environmental aspect areas. “BT constructed an environmental management system that was based on these aspects.”

Change-proof system

The unique system covers buildings and is adopted throughout the business and, as Hughes suggests, “it’s change-proof. Those aspects remain, no matter how much the business changes.”

Another unique element of BT’s EMS was the decision to include the good things that they could bring to the environment, such as teleconferencing.

“We decided we’d include those in our environmental management system, which meant that they had to be audited externally. It’s given us a really positive benefit because we’ve had to get independent research to prove the value of those things.

“You could say, hypothetically, that working from home, doing conferencing has to be good for the environment.

But there was no hard data to prove that, so because it was included in our management system, it’s been very good for us.”

BT’s progress is reported on via its corporate social responsibility report, produced annually (and available on the internet at world). And it’s a great example of excellence in environmental reporting, winning many awards for its transparency and effectiveness.

But while BT gets it right, Hughes feels sympathy for those still getting to grips with their environmental policies. He certainly doesn’t want to see reporting made compulsory any time soon. As a key member of the Aldersgate Group, a new cross-sector forum which is tasked with debating the future of environmental regulation, Hughes says that it’s certainly an area being explored at the moment. “We are currently discussing how far compulsion goes. At this stage, we don’t believe that compulsion is necessary.

“What we’ve seen over the years that we’ve been doing this, is a growth in companies reporting. Certainly successive environmental MPs and cabinet ministers have talked about naming and shaming companies that don’t do the things they ought to do on environment. But in terms of compulsion, we believe that this is a good way forward and companies ought to do this as part of their accounting process.”

Good for business

And if you needed evidence to back up claims that being environmentally sound isn’t good for business, BT has plenty to offer. Since the early 1990s, the company has saved around £100M in energy costs. Its energy-related CO2 emissions have been reduced by 60% since 1996. Vehicle-related emissions are down 38% in the same period.

With BT using around 1.8% of the UK’s commercial electricity supply, the company signed up the world’s largest green energy contract in 2005. Now, 95% of all electricity is supplied from wind, solar or wave and combined heat and power plants. Hughes was delighted at the feedback he received. “I got so many emails about that contract.

“People from the USA and from far-flung corners of the world, who weren’t BT customers, were just saying how pleased they were that BT was doing something like this and demonstrating leadership in a very important area.”

But do customers really care about BT’s environmental performance? Hughes certainly thinks so. “Each year we do Mori surveys about stakeholder awareness.

“What we’ve found over recent years is that environmental awareness is going up the agenda, mirroring what’s going on in the outside world. So a significant proportion of our customers expect us to be doing something about the environment.”

And for Hughes (and the requirements of ISO 14001), doing something about the environment means continuous improvement. “When we first started doing it, we got the low hanging fruit. In subsequent years, we’ve had to go for better and better improvements,” he says.

“Our performance has improved each year, and it’s getting harder and harder to do because the easiest things have already been done.”

Back in 1991, BT had its own environmental management system but it was thought that a more “robust framework” was needed. “And we found that because we already had the quality management system [ISO 9001], we were able to piggyback on that and a lot of work had already been done to put a management system in place.”

One of the key things that BT has built into its EMS is looking at procurement – “sourcing with human dignity, making sure we use the right sort of suppliers and making sure that environmental management comes into the criteria when we are judging the needs of our suppliers.

“Major companies like ours have a duty to their shareholders and stakeholders to look after the environment. We like to think that we provide a lead and a vision because we’ve looked at our own internal products and services and how they can benefit the environment. And because we’ve got the size, we can make sure our suppliers conform to the standards we expect.”

Smaller companies

But what about the smaller companies out there that don’t know where to start when it comes to environmental management and certification? Hughes says that the most important thing to consider is whether it’s important for your company to go down the formal certification route or not.

“Every company can look after its environmental management to the extent and

size of the company. So, it’s important to consider the impacts and focus on the

significant ones. “But you should also consider the future growth of the company and whether you’ll need some form of certification as well.”

As for BT, Hughes’ team certainly won’t be resting on its laurels. Next up is a special focus on climate change. “It’s obviously a very significant factor that’s here with us already, and we’ve decided to put some particular focus on it.

“We’ve just recruited and put somebody in place who will be working on climate change. We’re putting a climate change paper to the main board later this year because we consider it to be a major factor commercially as well as from a CSR perspective.”

BT has won plenty of acclaim for it’s environmental work. Mike Hughes deserves every ounce of it.

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