Now is the time for Scottish Businesses to truly build back better
Insider and Darren Flynn, Head of Scotland, Corporate and Institutional Coverage at Bank of Scotland, introduce their partnership to help Scottish businesses on their sustainability journey
The Coronavirus pandemic and the huge economic issues that it presents are a challenge on a scale that business leaders normally do not face in peacetime.
There are so many interlocking factors that need to be taken into consideration. Companies also have to jump so many hurdles at a time when their ability to do so is severely hampered, with key workers furloughed among many other constraints.
But in charting that recovery there is another underlying challenge that makes the tasks involved even more difficult but also, arguably, present a major opportunity to do things differently – and better.
Hence the need to "build back better", a phrase that has importantly been adopted by new US President Joe Biden and by Prime Minister Boris Johnson.
The UK Government created the Build Back Better Council, a new business body that aims to bring together a broad range of business leaders from across the whole British economy to work in partnership with the government to unlock investment and boost job creation.
The Council, which had its first meeting on 18 January, includes among its members Sir Ian Wood, the veteran energy executive who is Chairman of Opportunity North East, a former Chairman of the Wood Group and of economic development agency Scottish Enterprise.
At Insider, we are keen to play our part in helping to create more sustainable business models and ways of operating, to build and build back a greener, more planet-friendly economy.
To that end, we have partnered with Bank of Scotland in the creation of The Green List, a directory of major Scottish companies and the work they are doing to become more sustainable.
It will focus on the challenges and opportunities in doing that. It will highlight both best practice and areas where there are still difficulties and, in doing so, provide clear insight to business.
Many companies consider the path to net-zero daunting: a recent poll taken during a Bank of Scotland live event on sustainability showed that companies ranked the sheer complexity and range of issues involved as one of the biggest barriers to becoming more sustainable.
Darren Flynn, Head of Scotland, Corporate and Institutional Coverage at Bank of Scotland, says: “Our purpose is to help Scotland recover and a prosperous economy requires a healthy environment. Sustainability and concerns about the environment are very much on the minds of our clients as they seek to recover and build for the future with a clear strategy and focus.
“Scottish businesses have experienced major disruption this year due to the Covid pandemic. However, notwithstanding this, our clients remain committed to improving their environmental sustainability.”
His comments mark a wider change in business thinking and practice, with the whole sustainability challenge having steadily risen up the agenda.
Thinking and practice on areas such as reducing both the use of natural resources and business waste have become more commonplace in the boardroom and on the factory floor.
There are ever-increasing numbers of major enterprises realising, both from studies and in their day-to-day experiences, the benefits of being seen as "green" and "good corporate citizens". Key to this is that businesses do not just express the right sentiments but also "walk the talk".
Environmental, Social and Governance (ESG) factors are increasingly being applied by investors when looking at companies and analysing material risks and growth opportunities.
More investment is going into these areas and companies are devoting time and resources to making changes in practices and processes to be more green. Within the corporate world itself, companies are making sure that their board includes directors who can make a contribution on this issue, guiding the business to a more sustainable, lower carbon way of doing things.
Businesses are also looking at their partnerships and their supply chains to see what can be done collaboratively to produce lower carbon ways of operating.
Alison McRae is senior director of Glasgow Chamber of Commerce, which has championed the circular economy and encouraged its introduction across a range of businesses.
She says: “We are still very much in the grasp of a global pandemic but, as we look to a recovery plan, circular economy can certainly influence our decisions in the future. We must be open to partnerships and new ideas to change the way we make and consume – the circular economy is going to be a key part of our future. Businesses adopting that change now will reap the rewards for years to come.”
Bank of Scotland and the wider Lloyds Banking Group is looking at what it can do to encourage and facilitate sustainability with its customers.
The overall Group has increased its green lending commitment from £3bn to £5bn, to encourage a wider range of clients in what it sees as a really positive step to help businesses become greener.
The Bank has also developed a training programme for its Relationship Managers with the University of Cambridge Institute for Sustainability Leadership to help them better support clients in the fast-moving landscape of sustainability.
Relationship Managers are there to provide a broad range of support across the sustainability journey, not just green financing.
The Group has supported renewable energy projects such as offshore wind farms, which help provide power to an average of over six million UK homes - exceeding the 2018-20 target of five million.
For the Scottish business community to truly "build back better", as individual companies and the economy as a whole recovers from the effects of the Covid-19 pandemic, it will need a clear focus on the big picture and drive to deliver it. And that will mean thousands of different actions and decisions being taken across the whole of the business community.