Over the last several years, legislative bodies and regulators globally have enacted social responsibility and due diligence laws in hopes of improving the way businesses and their supply chains interact with their communities and the environment. In this episode of Assurance In Action, Justin Bettey, Intertek's Director of Strategic Partnerships, asks the question, is legislation enough? We examine real life examples of the effects of legislation, company action, and consumer pressures, and how they work together to make the world a more sustainable place.
Hello and welcome. You were listening to the Assurance and Action Podcast Network, brought to you by total quality Assurance provider intertech. Our podcast today is titled CSR Due Diligence Legislation. Will It Save the World? I am happy to be joined by my colleague Justin Betty. Uh, Justin is Intertech business assurances, director of Strategic Partnerships. Justin has more than 25 years of experience in the field of sustainability. Justin will c s r due diligence legislation help save the world.Speaker 2:
Thank you, Seth. Um, well let's see. I've got, I've got a few words to be saying on this subject, so let's maybe discuss that at the end, uh, and see what we both think and, and the rest of the audience. So, um, thank, thank you Seth for that and welcome and hello everyone and thank you for listen, uh, to this podcast. So, so lemme get started on, on, on this topic. Um, in recent years, um, I think we all know there's been an explosion in corporate csr, due diligence legislation and, and it's been 23 years, uh, since at least 21 Chinese illegal immigrants were drowned by incoming tide nor Baying England while harvesting cockles off the Lancashire coast. That's a long time ago and it really was a tragic accident. In those 23 years, we've seen various pieces of legislation coming into force that are requiring companies to take ownership and accountability for the social and environmental performance in their own operations and that of their up and down stream supply and value chains. I mean, that is not an easy task to do. And the latest legislation that came into effect this year, the EU Corporate Sustainability Reporting Directive is putting even more responsibility on those large corporates. I think what I want to explore in this podcast, Seth, are three parts of this emerging legislation. Firstly, how will corporates meet these requirements? What impact will it have on at risk or exploited people and our ecosystems in the world and what will it mean to me and you, Seth, who in the end are also custodians of this world related. So firstly, how are corporates meet these requirements? Well, it won't be simple or cheap. Just trying to figure out what is material salient or important to you is difficult, but assessing what's material or important to a whole bunch of other stakeholders. Well that takes time, expertise, and investment. There are still large companies out there that a don't even know where their products are made seriously. Says, I've met them and they really don't know. All they see is a container that lands in their warehouse and they start to unload the goods. Well, how hard can you be to trace that container and put us back to a factory? Well, maybe not that hard, but then consider tracing back all of the raw components and materials that we are into making that product. Oh, now you have a bigger problem. Good luck in tracing raw cotton and sugar cane and cocoa back to the plantations they were growing on. Okay, so, so I am being a little bit cynical here and there's an innovation wave right now on technologies and solutions for supply chain mapping and traceability from on the ground, verification by experts to the use of blockchain technologies to verify chain of custody and providence of those materials. I mean, at inter tech right now we are helping many of our customers with this supply chain mapping and traceability challenge. We haven't even talked yet about the impact of those products and manufacturing processes are having on people in the environment. Toxic waste, air pollution, energy and material usage, global warming, forced labor, child labor, death. The World Health Organization estimates that 2 million people die each year due to work-related reasons. This list is long of the social and environmental impacts that supply chains can have on our world. It does make me wonder, Seth, actually where the company's due to legislation, stakeholder and investor pressures end up saying it's all too much. We are here to set a product and make a profit not to save the world. And that leads to me onto my next topic. What impact will this legislation actually have? Corporate reporting will mean that a huge amount of data will be amassed by industry trying to assess and remedy social and environmental impacts. Now this is where there could be good news for all of us. If there's one thing modern businesses are good at, it's collecting and analyzing data, big data, data lakes, servers full of data. This is where there is the greatest opportunities for businesses in the world. This data will help corporates, I believe, move to a real time predictive position in their business performance. They'll become nimbler and more flexible and using sustainability based data to inform their business decisions, reduce risk, and become more competitive for too long now. Well my personal view only of course here, businesses have been too focused on that one KPI P to driving forward profit. Now Seth, we are not so naive in thinking that profit will not remain the main KPI and capitalist based economies, but time to change it. And when you can see the post covid insecure supply chain reduced workforce and the recession hit world we are in, businesses are looking for any advantages so they can keep both share and stakeholders happy. So after my quite cynical and negative start set to this podcast, I do have optimism for the future. I do see that the plethora of due diligence legislation will drive the ballrooms to see sustainability as a competitive edge to attract investment revenue, customers and profit. And guess what? The spinoff from that is less impact on the environment and human rights. I often mention my daunted, my podcasts and this one is no different. They frequently say we're a great industry are working cuz every day I'm speaking to companies about helping them improve their sustainability performance. It's true. Uh, in tech we are helping some of the largest companies in the world measure and assess their impact on the environment or employees, which I'm proud to do. Every worker we identify as not being paid a legal wage or fire a door. We find locking a factory or a discharge pipe pumping out chromium. Six is our way of supporting those companies in meeting their legal due diligence requirements. So what does this mean for me, for you, ait? Okay, so let's not put all the hard work and responsibility onto these companies who are making the lovely stuff. We like to buy from our phones every day. We need to do our bit to support as well. We are all important stakeholders that companies need to listen to and our behavior accounts, remember this new legislation extends the whole value chain. And guess what, as consumers, we are part of that value chain. Firstly, voice and choice. We need to voice our support of sustainability. And guess what, again, social media is great at that and companies listen to it a lot. Choice. Choose brands that put sustainability at the heart of their business. Re reviewing your favorite brand sustainability report will do that. If they don't commit to putting sustainability first isn't an easy swap to another brand that does make that commitment. We also have to consider our own behavior recycling, reusing, disposing and responsible purchasing. There is no point in large companies changing their behavior due to this legislation if we don't do the same. So what does it mean to the value of this short podcast today? Well, it's clear that as a corporate, unless they put sustainability at the core of their businesses, then they really will not be competitive in the coming decades. And likely it will cease to exist very quickly. It's a short ride for those not believing that their time is up data. This will be the heart of company's ability to measure and improve csr performance driven not just by stakeholders, but these new and far-reaching legal requirements for the people on the planet. Well, I've see an acceleration in innovations technologies and commitments by corporate and understanding and reducing impacts to people on the planet. To me and you, let's remember this legislation applies to companies, but we also need to do our bit in supporting them to behave in the right way and meet those legislative requirements. As an example, I purchased Seth this week, an electric fan heater and forgot to put the clearly identifiable recyclable packaging into my recycling beam, which that company probably spent hundreds of thousand pounds developing and making that packaging recyclable. And then I just go and put it into the wrong bin. There's no point in having a c economy of stringent due diligence legislation. If there was one week link in the chat call Seth. I have now since put that packaging into the right recycled bin. Thank you for listening to this podcast and do reach out to myself on intech if you'd like to discuss this topic further. Thank you very much.Speaker 1:
Thank you for listening to the Assurance and Action Podcast Network. If you would like to learn more about industry trends and topics, uh, find us at the link in the description of this podcast and give us a follow and a rating. You can also follow us on social media, on uh, LinkedIn and Twitter at Intertech Business Assurance.