Hello and welcome to series two of Microsoft Stories, a podcast about technology and the people who use it.
Over the course of this series we will speak to young people about the big issues affecting their lives and shaping their futures. We will also look at the companies and organisations playing a role in those issues, and explore how technology can be used to create innovative solutions.
For episode two we are staying with sustainability – one of the most urgent issues of our time and a key focus for the UK with the COP26 summit being held in Scotland.
This episode asks: how can organisations launch impactful sustainability plans and continue to grow? Your customers should love your efforts to reduce your carbon footprint, but how do the inevitable changes to your organisation affect what it does and how it does it? We hear from two young people who are passionate about the environment and how they view companies who are trying to be more environmentally friendly. You will also hear from Microsoft’s Sustainability Customer Lead, as well as Rebecca Marmot, Chief Sustainability Officer at Unilever, about the work both companies are doing to be greener.
Click the play button and join us on our journey.
Transcript of this episode
Let’s find out!
This is the second episode looking at environmental sustainability – a topic that’s top of mind for people and companies.
The first episode in this series looked at the importance of companies measuring their carbon footprint so they can reduce it, as well as the tools Microsoft is making available to help organisations do that. This episode takes that a step further: once an organisation understands its carbon footprint, how do its leaders combine their new sustainability strategy with a successful growth plan?
Can efforts to make an organisation greener have a negative effect on productivity? Or does it unlock new opportunities and set the organisation up for success in a greener future?
The UK Government has set a target for the UK to be Net Zero by 2050, so the pressure is on for organisations to take a long, hard look at every aspect of their operations, and make it more sustainable. There’s also pressure from consumers, too – especially young people, who increasingly want to see the brands they buy from reflect their own views on key issues. That includes helping the planet.
Here’s Samuel, a 24-year-old from London, and one of the many people we have spoken to for this podcast who is supported by charity and social business Catch22.
SAMUEL: I’m heavy on recycling at home, so if a company has that sort of mentality or has that in their company ethos, then that’s something I can definitely resonate with and I could also see myself going to that company or purchasing products in that company in the future. As someone who’s starting to see the benefits of reducing carbon footprints to prevent harmful gases in our ecosystem, I’m all for companies actively trying to implement this into their ethos.
Samuel cares about how his actions affect the planet. He uses an energy company that provides renewable electricity and its gas is 100% carbon neutral. He also regularly buys food from a vegan business, even though he’s not vegan.
SAMUEL: It’s also quite important for you to try and incorporate vegan meals into your diet, possibly at least once a week, once or two times a week. That can’t hurt. It’s great for the environment.
Pressure to be more sustainable is not only coming from consumers, it’s coming from inside companies, too. Recent research released by Dr Chris Brauer, Goldsmiths, University of London and Microsoft – entitled Accelerating the Journey to Net Zero: A UK Blueprint for Carbon Reduction – revealed that 67% of UK employees expect their employer to take action to reduce their business’ climate footprint, while 72% believe sustainability should be a top priority for businesses over the next five years.
However, the study also found that only 19% of employees believe their employer is implementing their current sustainability plan efficiently.
So, companies know they need to be more environmentally sustainable, they want to be more sustainable and there is pressure from all sides for them to be more sustainable. But they’re not making that change fast enough or comprehensively enough.
One reason for that is uncertainty about how sustainability initiatives will affect their organisation. According to a World Economic Forum report on manufacturing and sustainability … quote – “Leading CEOs are quantifying how sustainability generates tangible value down to bottom-line profit and loss.”
However, starting your sustainability journey should be done with a step, not with a leap. There are many relatively easy things companies can do now that will not only help them be more sustainable, but could also potentially save them money.
Here’s Eve Joseph, Sustainability Customer Lead at Microsoft UK, on two key steps – moving to the cloud and data.
EVE: Microsoft is supporting companies to be more sustainable in many different areas, but the ones I think I’ll mention today… one is around supporting our customers to have more carbon efficient IT, so enabling companies and businesses to transition their IT to the cloud will help them be more energy efficient. So, for example, our cloud technology, Azure, can help organisations be up to 93% more energy efficient. So it’s all about thinking, when you’re running your IT system – How can you make it as efficient and as carbon efficient as possible?
Second, I’d say we’re supporting companies in getting their head around data management, so to reduce anyone’s carbon footprint, any business, any company, any retailer, they need to know their baseline, otherwise, how do you know you’re reducing? You can’t reduce something unless you know where you started.
Eve is saying it’s crucial that companies understand the scale of their sustainability project before they embark on it, so they can accurately predict costs, impact to the organisation and ensure it supports growth. That all starts with measuring your carbon footprint. We covered that – and the Microsoft tools available to help you – in episode one of this podcast, so go and have a listen if you missed it.
But where companies are pushing ahead with meaningful sustainability plans that are supported by a strong business case, leaders are typically jumping in with both feet.
According to the research by Dr Chris Brauer, Goldsmiths, University of London and Microsoft, companies are investing in technology to be greener in the short-term and the long-term. Immediate priorities are business productivity technologies, collaboration technologies, cloud technologies and carbon emissions measurement technologies.
Over the next five years, business leaders plan to shift their focus to more intensive use of Robotic Process Automation, machine learning, and “digital twin” technologies, which is a rapidly growing area that simulates business processes and strategies at scale without the real-world waste.
One company that has embraced sustainability and embedded it throughout the organisation to support growth and innovation is Unilever.
In 2010, the global consumer goods business, which owns brands such as Persil, Dove, Hellmann’s, PG Tips and Comfort, and uses Microsoft Azure and Microsoft 365, launched a Sustainable Living Plan to help billions of people, reduce its environmental impact and enhance the livelihoods of people in its supply chain. Overall, the plan, while ambitious in its breadth, size and scope, was a success, Unilever’s leadership felt there was more the company could do.
Fast-forward to 2020 and Unilever has evolved the Sustainable Living Plan into The Compass – a new strategy that has embedded green thinking in every part of the organisation and helps others to do the same.
Here’s Rebecca Marmot, Chief Sustainability Officer at Unilever, to explain how that works.
REBECCA: Sustainability really is peppered all the way through it, so it might be around, for example, plant-based foods or it might be around some of the work that we’re doing with the brands. It might be around thinking about channels and what are we doing with ecommerce, thinking about digital inclusion, financial inclusion, lots and lots on culture around diversity and inclusion.
So, not just thinking about consumers and not just thinking about shareholders, obviously, absolutely both of those completely crucial, but making sure that we think about all of the stakeholders that impact our business, so thinking about our own people is really, really important, our suppliers, our business partners, our customers, the big retailers, thinking about society and NGO groups, the planet. Really making sure that we took all of them into consideration as we’re starting to shape the business.
A study by Kantar last year revealed that brands with a meaningful and coherent purpose that was understood by consumers saw more value growth than brands that did not have a purpose or only a partial one. Over a period of 12 years the brands with high perceived positive impact saw brand value growth of 175%, versus 86% for medium positive impact and 70% for low positive impact.
The critical difference for the overperformers in Kantar’s study was that they had infused their purpose-led mindset throughout the entire organisation, rather than it just being a marketing ploy or one-off moment.
Unilever is an overperformer. It has created a culture of sustainability and made it a core part of its business, but the important thing to note is the company is still growing. It sells products in more than 190 countries and reaches 2.5 billion people a day. It employs 149,000 people and generated sales of €52 billion in 2019.
Here’s the key stat to take away from Unilever’s green journey: the company’s sustainable living brands delivered 78% of total growth and 75% of turnover in 2019.
Unilever found that fusing the company strategy with its sustainability strategy created value by – and I quote – “driving growth and trust, eliminating costs and reducing risks”.
REBECCA: Probably one of the things that we’ve learned on the journey to doing that is the importance of trying to do it in stages. The first part of that is making sure that your own company reflects those changes that you’re talking about and you’re setting in wider society. So for example, if I think about the environmental aspects and the work that we might be trying to encourage others to do around renewables, actually, it was really important for us to make sure that across all of our sites, we’re using renewable energy.
I think stage two is looking across your value chain to look at the impact that you can make. So if you think of a consumer goods company like Unilever, it’s from sourcing of those raw materials, those crops, those commodities, working with farmers in the field, right the way through the manufacturing process and then through to the retailers and thinking about what we can do there.
I think the third area, and this is something that we’ve really worked on over the past few years, is being able to use the power of your brand, as a consumer-facing company, is hugely helpful and beneficial.
Key to Unilever’s success was its approach – it started small and grew it stage by stage.
One of the key findings from the Microsoft’s research was that 74% of UK firms have “one foot in and one foot out” on sustainability, and are better at designing strategies than executing and operationalising plans in this area.
As well as starting with small steps such as moving workloads from on-premise data centres to the cloud and using data to understand your organisation, another key area of sustainability investment is your staff.
Companies need to have the right staff with the right skills to put their sustainability plan into action. Microsoft runs digital skills courses covering a range of topics – from data centres and the Internet of Things to data analysis and understanding your organisation with Dynamics 365. Each of these – and many more – can help an organisation understand and tackle its carbon footprint in very simple or very complex ways – it’s up to you.
Here’s Microsoft’s Eve Joseph again.
EVE: The second key area I think is super important for businesses is to take note of the green skilling movement. It is happening. In 2020, the fastest-growing top three green skills were environmental sciences, climate and waste. There’s also a growing body of research which shows that companies who take note of their purpose and share that purpose externally and also integrate sustainability into their business model will not only be helping the planet, which is super important, but will also have lower rates of employee attrition and are ultimately more profitable.
Like Microsoft, Unilever is also helping its employees learn new skills. This helps their staff, who can gain knowledge in an area such as sustainability and lead them to new career opportunities, and it can help the company, too, because those workers are less likely to leave for another job.
Upskilling doesn’t mean going back to university to study for three years. There are many future-fit skills that people can learn online. Check out Microsoft’s Digital Skills Hub and Sustainability website after you finish listening to this podcast and start gaining new skills.
In the meantime, here’s Rebecca at Unilever again.
REBECCA: It’s not anymore just about academic qualifications. Skills are so important. Looking at collaboration skills, thinking about creativity, about critical thinking, about communications skills. And I think as well, and you see this particularly in young people, such a strong desire around purpose and around being activist and actually thinking about the role that all of us can play in realising our own purpose. It’s something that is really important at Unilever. Everyone is encouraged to think through what is their own purpose and how do they bring that to life in their jobs in a meaningful way. And I think young people, even more than perhaps some of the older generations, are massively energised by being able to bring their true authentic selves to work and think about how they bring that purpose to life.
Having staff who are passionate about sustainability and have the right digital skills is important for any organisation that wants to be greener and keep growing. Ideally, your staff will have both, because they can use their digital skills to interpret data, act on it and have impact for the organisation, while also understanding what a good green strategy looks like.
Ciara, a 25-year-old from London, said she would love to work with companies to help them be more sustainable.
CIARA: I hold myself accountable for a lot of things. So being able to hold these big corporations, for example, accountable for what they’re doing, and making sure that they are doing what they can… Even if it’s just making sure that they’re carbon neutral by making sure they plant more trees, or they’re clearing plastic out of the sea, or loads of different ways that companies can help better their carbon use and make sure that they are as carbon neutral as they can be.
Samuel, the 24-year-old from London who we heard from earlier, feels the same.
SAMUEL: As a young person, we have a massive responsibility to improve our futures today, tomorrow. So if that’s something that I can do within my job or whatever job role that I’m in, I’m not going to shy away from that because, as I said, we have a responsibility to make sure that what we do today has a positive impact in future for our children and our children’s children, to make sure that we’re living in an environment where it is sustainable, where we won’t have too many harmful gases in our ecosystem, where we’re recycling goods so that products are being reused where needs be.
If you’re a business leader and you’re worrying if your organisation can be more sustainable and continue to grow, hopefully this podcast will give you confidence that it’s not only possible but the first steps can be simple.
Study your data to understand your organisation; look at technology such as the Azure cloud, Microsoft’s Emissions Impact Dashboard, the Cloud for Sustainability and Planetary Computer; make sure you have the right staff with the right digital skills; and draw up a sustainability plan that can be embedded throughout your organisation.
Finally, start small – by changing a little, you change a lot. Your staff will upskill and grow with your sustainability plan, spotting opportunities to add even more value; you can measure the impact of your plan more easily; and even small changes can start positive conversations with your customers.
Here’s Ciara with a good example.
CIARA: There’s another company that I know that sells gym gear and they’re all sustainable and they’ve got recycled products, but they make sure that their tags are little plants. They’ve got seeds so you can plant the tags and grow plants, and obviously that helps to offset a lot of the carbon in the environment. Even just something as small as that can make a real difference to how I see a brand.
I’m afraid that’s all the time we have for today. Thank you for listening and make sure you look out for the next episode of Microsoft Stories soon. Bye for now!
(Music continues and fades)