Doing business is good for business

There was a time when profit and corporate social responsibility were uncomfortable bedfellows. Business leaders found it hard to align helping the planet with improving the bottom line. After all, it cost money to be nice.

Today, however, companies are dedicating huge sums to ensure that fiscal concerns go hand in hand with a broader sense of social purpose. The eureka moment came when businesses realised that, far from becoming a burden, acts of social responsibility could actually become a benefit.

Those businesses that have embraced this wider corporate responsibility have seen an uplift in reputational measures and better engagement with employees and potential hires. Consumers are increasingly choosing brands for their ethical behaviour and their record on climate change.

According to Deloitte’s Global’s 2019 Millennial Survey ,38 percent of millennials and Gen Zs have stopped or lessened a business relationship because of a company’s ethical behaviour. Conversely, 36 percent said a company’s social issues engagement spurred them to become a customer or deepen their relationship with the organisation.

Deloitte Global CEO Punit Renjen says: “We firmly believe that companies motivated by a greater societal purpose will be stronger, more successful businesses for the long term.”

Compound has baked social responsibility into everything it does as part of its Impact Investment strategy which seeks to generate financial returns while also creating a positive social or environmental impact.

When Compound’s founder Jacob Sandelson converted the old Waterfront Studios Business Centre in London’s Royal Docks, he wanted to provide more than just office space for small businesses. He wanted to build a community with a benevolent landlord at its heart – someone who gave back as much as it took.

During the Covid 19 crisis, he set up a full-time, free, advisory service to help tenants through the maze of complex procedures designed to help businesses through the pandemic. Over coffee in the Expressway Genius Bar, Sandelson’s team dispensed advice on everything from VAT deferral and furlough, through to Coronavirus Interruption Business Loan Scheme, grant funding and the bounce back loans.

In addition, Sandelson worked with Newham Borough Council to create a youth incubator scheme which provides a number of free spaces to local people aged between 18 and 30. These “incubees” were also offered skills seminars, development support, social media marketing advice, guidance on accounting for small businesses and on how to raise funds.

Despite the extra cost of running these initiatives, the investment has paid off with a healthy 92 occupancy rate and a positive uplift in reputation.

As well as a commitment to community, Compound is passionate about its carbon footprint and ensured all its developments far exceed industry environmental standards. Compound’s latest project – a 91,000 sq. ft self-storage facility in Tunbridge Wells- will deliver a 194% biodiversity net gain and generate 60% of its total energy requirement through on-site renewables. It has been rated BREEAM excellent – a sustainability award given to only 10% of commercial buildings in the UK.

Investors are favouring businesses with robust ESG frameworks. In fact, 60% of respondents to CBRE’s 2021 Global Investor Intentions Survey stated that they have already adopted ESG criteria as part of their investment strategies.

And governments are implementing regulations requiring organisations to increase transparency in areas such as diversity, equal pay, carbon emissions and modern slavery.

With all stakeholders, from investors to tenants wanting to see hard evidence of a commitment to ESG and social responsibility, Compound’s strategy appears to be hitting the right note.