www.umalia.com Spring / Summer 2018 • Volume 3 • Issue 1 Français
Message from the Editor: It’s time for the private sector to differentiate itself amid turbulent global megatrends
Photo: Courtesy of Umalia Lucie Bourgeois, President of Umalia.

At a very young age, Scottish-born accountant William Barclay Peat recognized that a corporation’s “core purpose” is the progenitor of its “core goal” of profit. Known for his honesty, integrity and discretion, Peat became a partner in his early 20s in a small London accounting firm.

By 1891 at age 39, he had assumed leadership of the firm, which had pressing debts. The path of least resistance for Peat would have been to close the company and start over with a clean slate. Instead, he called on all the firm’s creditors, promising to pay them back if they would give him enough time.

Due to his sterling business reputation for probity, the creditors believed him. They gave him time, he paid them back and went on to even greater heights with his appointment as the accountant for the Privy Purse of King Edward VII before being knighted in 1912.

Most of us are likely not aware of his family name, Peat, but all business people have heard of KPMG, a multinational firm offering audit, tax and advisory services aimed at increasing business performance and value. Peat is the “P” in KPMG, which has 197,263 employees operating in 154 countries.

The lesson that we can derive from William Barclay Peat’s business success is that core purpose leads to core profits. For example, aligning your business with core values of higher social purpose helps build up communities in need, which in turn can help sustain long-term business viability from the points of view of employee engagement, staff morale, public support and profitability.

The Internet has turned the world into a digital village with social media opinions spanning the globe in seconds, creating enormous impact that can make or break business reputations.

The Internet has turned the world into a digital village with social media opinions spanning the globe in seconds, creating enormous impact that can make or break business reputations. Just ask Evan Speigel, CEO of social media messaging company Snapchat, which lost $1.3 billion of its stock market value (6 percent) on February 22, 2018, within hours after American reality TV star and model Kylie Jenner tweeted that she did not like the app’s new layout which had been implemented without consulting its users.

By 2030, 50 percent of the world’s population will have access to the Internet – meaning it has never been more important for corporations to develop a socially responsible vision and to enunciate it clearly with a view to differentiating themselves from the competition.

Businesses need to be aware of social, financial, environmental and political megatrends with a view to understanding their potential impact on them and how to remain competitive. KPMG produced a major report in 2013 titled, Future State 2030, which identifies the nine global megatrends that will change the global economy and physical environment in the coming decades.

The nine megatrends identified by KPMG:
1
Demographics – Higher life expectancy and falling birth rates are increasing the proportion of elderly people worldwide.
2
Rise of the Individual – Advances in global education, health and technology has empowered individuals as never before, leading to increased demands for transparency and shared decision-making.
3
Enabling Technology – Technological advances are testing governments’ abilities to harness their benefits and provide prudent oversight. [A Feb. 21, 2018 column by Washington Post business writer Robert J. Samuelson listed Internet cyberattacks and hacking as the greatest threat to the U.S. economy based on the annual report from the White House Council of Economic Advisers, which cited one study that estimated the U.S. would suffer $1 trillion worth of damage from an attack on its “critical infrastructure”, such as its power grid or payment system.]
4
Economic Interdependence – An interconnected global economy requires international conventions to be strengthened in order to optimize economic benefits for all.
5
Public Debt –High government debt is curtailing the ability of governments to deliver needed public services and to respond to major social, economic and environmental challenges.
6
Economic Power Shift – Emerging economies are lifting millions out of poverty while exerting more influence on the global economy and rebalancing global power. [China and India are expected to account for 25 percent of global GDP by 2030, with 57 percent of GDP accounted for by developing countries. A 2013 study by the International Labour Organization shows that 90 percent of the global youth population lives in developing countries. – Stimulus Editor]
7
Climate Change – It is proving difficult for governments to implement the right combination of adaptation and mitigation policies to deal with rising greenhouse gas emissions that are having a negative impact on the environment.
8
Resource Stress – Sustainable resource management has become the focus of government agendas due to the combined pressures of population and economic growth, as well as climate change.
9
Urbanization – According to a United Nations’ study done in 2011, almost two-thirds of the world’s population will reside in cities by 2030, exerting pressure on infrastructure and resources, particularly energy.

These megatrends illustrate how fast our complex world is changing. Our interconnectedness means issues have to be dealt with in a systemic fashion, rather than one challenge at a time. It’s also obvious that governments cannot solve all the problems by themselves. They need input and participation by all – and private industry stands as the first potential contributor, given its financial resources, its broad innovation, its ability to scale and replicate, as well as its unique ability to foster economic growth.

Not only is the private sector able to contribute and participate, but it needs to in order to mitigate, influence and take advantage of these global megatrends for increased innovation, differentiation and competitiveness. The private sector also has to get involved because it needs healthy and thriving communities to become passionate consumers and engaged employees.

There has never been a more crucial time for corporations to find ways to address societal challenges through their business models and to use their resources to get ahead of the megatrend curve by collaborating with governments and NGOs in partnership projects that bridge the inequality gap. As William Barclay Peat did more than a century ago, they’ll likely discover that solid core moral values lead to solid corporate profits.

Lucie Bourgeois – Editor, Stimulus
Founding President of Umalia

Conference Board of Canada predicts ‘Defining Forces’ will threaten businesses by 2030
Photo: iStock.com Climate change is one of the wide-ranging trends that is predicted to disrupt business practices in Canada by 2030.

Climate change with its attendant water shortages, intense wildfires, and flooding is listed as one of the defining forces which will disrupt business practices in Canada by 2030, according to a pending report by The Conference Board of Canada (CBOC).

The report – titled Canada 2030: The Defining Forces Disrupting Business – identifies 30 major “wide-ranging” trends that businesses in Canada will have to respond to if they hope to be successful under altered and changing circumstances.

Climate change will have “significant implications” for Canada by 2030, Sally Crane, Senior Research Associate for Corporate Responsibility and Sustainability at CBOC, told Stimulus as part of a peek preview into the report, which is to be made public in the near future. “Canada is likely to experience more frequent and intense wildfires, heat-related mortality and increased damages from river and coastal floods, while properties in the highest flood-prone areas may ultimately become uninsurable.”

Canada is listed by the Pacific Institute, an American non-profit water conservation think-tank, as being among the top five countries in the world in terms of fresh water supplies. In descending order of reserves are Brazil, Russia, United States, Canada, and China, according to a January, 2015 report of the institute.

But John Pomeroy, Distinguished Professor and Director of the Global Water Futures Programme at the University of Saskatchewan, wrote in a February 2018 article in Maclean’s magazine that climate change has already impacted millions of Canadians with record droughts in the southern Prairies in 2017, intense forest fires in B.C. and unprecedented flooding in the Great Lakes-St. Lawrence basin.

And erratic weather patterns which impact Canada’s fresh-water supply will wreak even more havoc by 2030, the CBOC’s Crane warns. “Without adequate access to fresh water, supply chains could be disrupted, industries shut down and business growth limited,” she says. “In addition, crops could fail, ecosystems could be destroyed, health could worsen, and global conflicts could become more frequent.”

The CBOC’s entire report on disruptive forces – as seen through the lenses of their impact on “people, planet, performance” – will be made available on the CBOC’s website at www.conferenceboard.ca.

Client Success Story: Quadra Chemicals expands its impact

You can tell a lot about a company by its relationship with employees and suppliers. Judging by those standards, as well as by its impressive growth and financial success since its founding in 1976, Quadra Chemicals Ltd. is recognized as an industry leader in the Canadian chemical and ingredient distribution business. Quadra is recognized as one of the Top 100 chemical distributors in North America, supplying industries that manufacture products for food, human health, personal care, oil and gas, mining, agriculture, pulp and paper, water treatment, construction, as well as performance adhesives and specialties.

Since 2003, Quadra has been recognized as one of Canada’s Best Managed Companies, maintaining its Platinum Member status since 2010, and is certified as a Great Place to Work.™ Quadra won Silver for the 2017 Wellness Award by Canada’s Safest Employers. In November 2017, CEO Tony Infilise won EY Entrepreneur of the Year for the Quebec region in the Manufacturing and Distribution category. Their latest honour is being recognized in the prestigious Best Workplaces™ in Canada by Great Place To Work® Institute.

With headquarters in Vaudreuil-Dorion, Quebec – about 50 km west of Montreal –Quadra employs 345 employees in facilities and offices across Canada. Some employees have been with Quadra since its founding, many others have been on staff for decades, and in a few cases others have left only to return. “That truly says something about us,” Tony says. “We truly value our employees, who, in turn, feel they are part of a team and part of a family.”

Respect for their employees and the environment has been a touchstone for the company since its founding, with corporate social values which include commitments to employee dignity, safety, well-being, integrity and ethical behavior practices that extend to community engagement initiatives.

Quadra proudly supports about 40 charitable organizations across Canada, and each Quadra facility has an individual committee of volunteer employees empowered to support local organizations, either financially or through volunteerism. Quadra aligns its business practices with sustainability and “green chemistry”.

Photo: iStock.com To attain maximum impact, Umalia aligned the program with existing local interests, anchoring it in a national collaborative framework and a common annual theme.

It is through this prism of sustainability and giving back to the community that Umalia was approached by Quadra to design its Employee Volunteer Program. Some 98 percent of employees surveyed by Umalia said they were interested or potentially interested in volunteering their time to local causes, and 66 percent were already volunteers outside of work. There were also individual interviews and workshops involving Umalia staff and Quadra employees to help design the program.

To attain maximum impact, Umalia aligned the program with existing local interests, anchoring it in a national collaborative framework and a common annual theme. They adopted a bottom-up approach, with employees identifying local interests and aligning around core elements to create the content of their local Employee Volunteer Program.

The program aims to encourage one day a year of volunteerism spread over two days to ensure company operations are not adversely impacted. Participation is encouraged not only from employees, but also from retirees and external partners. Individuals are encouraged to form teams focused on building non-profit capacity capable of sustainable impact.

The program has leveraged amazing engagement among Quadra’s staff. Their vision is to advance health and well-being for their communities in need, and by 2020, they aim to be a recognized leader in safety and sustainability, with a significant positive impact in their local communities.

As Quadra says of its core-value system: “We couldn’t do it without our group of dedicated, caring and motivated employees – thanks to the entire team!”

Top Tips for CSR: Are you missing CSR opportunities? Now might be an opportune time to act!

At Umalia’s 5th anniversary dinner, one of our guests challenged others at the table with her observations on what is impeding the implementation of positive social and environmental change in corporations. She noted that executive managers often view their employees as “not ready”, that employees view consumers as “not ready”, and that consumers are waiting for corporations to initiate action.

Who really is not ready and what is it costing you

Umalia suggests that the time to implement CSR and sustainability initiatives might be closer than you think. More than ever, stakeholders are alert and aware of the benefits. With our clients, we have seen that opinion surveys sent to a sample of stakeholders help test the waters. Such a survey can help to:

  • measure interest;
  • identify to what stakeholders are ready commit to;
  • mobilize stakeholders’ engagements.

With one of our clients, a survey meant simply to measure the level of interest resulted in 17 percent of respondents wanting to participate actively in the design and implementation of an Employee Volunteer Program. The survey created a wave of enthusiasm across the organization. So get ready. The time to initiate opportunities might be right now!

Photo: Courtesy of Umalia
Spotlight on Corinne Adam Meet a key member of Umalia’s team

Our relationship with Corinne Adam is an example of how Umalia reaches out to strategic partners from multiple disciplines linked to CSR and sustainability in order to provide clients with state-of-the-art solutions creating societal impact as part of a successful business strategy.

For the last 25 years, Corinne has been working in the fields of communications, corporate social responsibility (CSR), labor standards and monitoring, humanitarian assistance, as well as ethical sourcing and stakeholder engagement. She has a broad range of experience, working with corporate entities, the not-for-profit sector and international organizations in North America, Europe and Latin America.

Corinne, who was born in France, is fluent in French, English and Spanish. She has an undergraduate degree in law, as well as Masters degrees in Corporate Social Responsibility and Political Science. She is also an Equivalence Assessment Expert with the business-driven Global Social Compliance Programme, which develops best practices for sustainable supply chain management. In addition to her extensive knowledge about supply chains, Corinne has deep expertise concerning international standards and social compliance, as well as key sector specific know-how in the apparel and agricultural industries.

Throughout her career, Corinne has demonstrated a pragmatic, results-oriented approach that creates lasting solutions. Working in multiple countries on all continents, she has developed an excellent network and solid understanding of crisis situations and organizations.

Corinne moved to Canada in 2006 to work as Director and then Vice-President CSR at Gildan Activewear. There, she built on and led an internal transformation to boost a culture of social and environmental compliance and accountability. Since then, as well as collaborating with Umalia on multiple mandates, she has been working with major brands, their suppliers and their licensees, as well as with global investors and stakeholders, such as the Inter-American Development Bank and the International Labour Organization to develop sustainable supply chains that respect human rights and environmental best practices while meeting business objectives.

You might also be interested to know that despite her engrained work ethic and professional dedication, Corinne has a great sense of humor and is someone who places great value on developing close working relationships with her colleagues!

IN FOCUS
Update on Umalia’s project in Benin Quebec government grant helps battle climate change
PHOTO: Courtesy of Umalia Lucie Bourgeois, President of Umalia (polka-dot dress), is seen surrounded by members of her local team and Steering Committee as she presents details of the Climat'Eau project to Sô-Ava residents in November 2017.

With a $771,715 grant from the Green Fund through the Programme de Coopération Climatique Internationale, the first mission for a major initiative to combat climate change in the community of Sô-Ava was officially launched in the West African nation of Benin – replete with extensive local media coverage – during the two months leading up to Christmas 2017.

The three-year project, managed by Montreal-based Umalia, is being done in partnership with Technologies Ecofixe, a Quebec company which specializes in the biological treatment of waste water, and with the participation of Université Laval, which is supplying research, analysis and consultation. The municipal government and the collective of local civil society organizations (representing more than 60 local NGOs) are also important participants.

There are four pillars to the project:

  1. Raise awareness and develop the resiliency of the local population towards climate change with a view to eventually changing behavior.
  2. Clean the water of the Sô river by applying Ecofixe’s water quality expertise, and add solar panels for additional electricity, thus improving the quality of life in nearby villages and schools. Plant trees to reduce erosion, ameliorate water quality, and mitigate future effects of climate change.
  3. Implement the seeds of a green business ecosystem with the support of the Université Laval by evaluating its potential, including the identification of the value chain and ecosystem mapping.
  4. Research on local governance around climate change by exploring how a decentralized governance model influences the capacity of local populations to adapt to climate change.
PHOTO: Courtesy of Umalia Dignitaries and team members attending the November 2017 official launch of the Climat'Eau project in Sô-Ava, (L to R): Aurèle Ayitchedji, Project Manager for Climat’Eau; Mario Carrier, Professor, Université Laval; Brigitte Bonou, President, Collectif des Organisations de la Société Civile; Eustache Kotingan, Premier Vice Président, Conseil du Patronat du Bénin; Marisol Labrecque, Présidente, Technologies Ecofixe; Gaston Cossi Dossouhoui, Ministre de l’agriculture, de l’élevage et de la pêche; Lucie Bourgeois, Présidente, Umalia; Antoine Labrecque, Technicien, Technologies Ecofixe; Kouakanou Bonaventure, Directeur de cabinet; Assogba-Komlan Françoise, Secrétaire générale du ministère; and Aguemon Dossa, Directeur de la programmation et de la prospective.

Sô-Ava, a community of over 120,000, lives mostly without electricity in houses on stilts located on Lake Nokoué, which provides water for transportation, fishing, washing and human consumption. In addition to prevailing social issues, such as low education rates and high population growth, there is also a concern about the sanitation level of Lake Nokoué.

Titled in French, “Climat’Eau Sô-Ava: Action locale – Changement mondial”, the project’s first mission in November and December 2017 recruited a local team of six to conduct activities on the ground, meeting with all key stakeholders, including the village mayor, the agriculture minister of Benin and other dignitaries who attended the kickoff ceremonies. More than 1,000 people participated in this first phase to raise community awareness about the project among local residents who were very interested and asked a lot of pertinent questions. There was widespread coverage of the kickoff on local radio, television and in newspapers.

What struck visitors was the high degree of national support, with interest coming from all sectors, including entrepreneurs and various levels of government. The project’s high profile in Benin represents a realization that if the private sector gets involved in such green infrastructure developments, it can also share in its future economic benefits.

The kickoff phase was used, in part, to determine where Ecofixe’s water treatment systems were to be installed and to take measurements, with the actual installations slated to begin in May 2018. Université Laval was also targeting to have in place by May 2018 the protocol governing research, ethics and methodology.

Umalia is grateful to the Government of Quebec for its generous contribution. Their involvement, and the Benin partnership, conceived with a shared value lens, demonstrates that any and every organization – no matter the sector or the size – can collaborate to address a social, environmental or economic issue through its business or organizational model.

We’ll keep you posted as the project progresses!

Meet the Author Neil Gaught attends Umalia’s anniversary dinner
Photo: Courtesy of Neil Gaught Neil Gaught: an expert in helping businesses, governments and NGOs position themselves for the future.

Among 25 executive leaders attending Umalia’s 5th anniversary dinner in October 2017 was Neil Gaught, author of CORE: How A Single Organizing Idea Can Change Business for Good.

Published in July 2017, the book has already sold out twice and is garnering rave reviews for its British author as a practical guide for businesses seeking to establish a core purpose which will create positive social change while buttressing the bottom line.

Among the plethora of outstanding reviews on Amazon are these words from Rachel Brown, founder and CEO of Sustainable Business Network, New Zealand: “There's been a lot of pontification about why businesses need to develop a social purpose, but precious little insight on how they can go about it. Refreshingly, Neil's done exactly that with this book – a must read for any business that wants to create social change.”

In fact, the purpose of Umalia’s 5th anniversary dinner was to bring together a handpicked group of 25 executive leaders from across all sectors – private, (large banks, apparel manufacturers, retailers, investments, insurance, consulting, technology, food and agriculture), non-profits (foundations, NGOs), media and academia – to facilitate a no-holds-barred discussion about the role of the private sector in society and how a Single Organizing Idea can, indeed, change business for good.

Graphic: Courtesy of Neil Gaught

Neil emphasizes that at the core of the world's most admired businesses lies a powerful Single Organizing Idea. These organizations deliver sustainable economic and social benefits; they unite people, attract investment, inspire innovation, pioneer new efficiencies, and enjoy positive reputations.

Such businesses are admired, but they remain a rare breed. Though the tides of change are engaging the minds of business leaders, most are still trapped behind their brands and an approach to Corporate Social Responsibility that is out of step with a connected society that increasingly questions “who” these businesses really are and what drives their purpose.

Neil’s book, CORE, was shortlisted for the 2018 Best Business Book Awards in the Engaging Change category. Those who wish to learn more about Neil can visit www.neilgaught.com or email him at neil@neilgaught.com.

Innovation Labs spark opportunities for business differentiation and growth Graphic: istockphoto.com

The Conference Board of Canada and Umalia have launched a collaborative project called Innovation Lab, bringing together executives from major Canadian companies to discuss how corporate social responsibility and sustainability can be used as levers of innovation to make them more competitive and prosperous.

As a result of the first such lab held in Toronto in May 2017, steps have already been taken by some of the participating companies to integrate into their strategic business plans the lab’s core principles of creating a competitive advantage and differentiation through the lens of CSR and sustainability.

The companies in attendance were Rogers Communications, Intact Financial, CPA Canada, CN, KPMG, Fiera Capital and The Co-Operators. Hosted by KPMG, the first lab was designed by Umalia and co-facilitated with the Conference Board of Canada, supported by a network of facilitators from sustainability-focused organizations.

Between two and four executives from each company – representing different disciplines within their organizations – were invited to attend the lab workshops in order to garner a diversity of perspectives. Discussions were held about global and Canadian megatrends impacting business and society, the role of social innovation and non-profit organizations, and the power of multisector collaborations designed with a shared value perspective.

The second portion of the lab walked executives through a methodology by which they could conceive of company-specific initiatives and strategies to target simultaneous business and societal impact.

After the workshops, the executives went back to their respective organizations with a view to stimulating discussion with their executive teams in order to implement these concepts targeted at creating business and societal impact.

Following the labs, Umalia and the Conference Board of Canada do follow-ups with the lab participants six weeks and then six months later, offering support, as needed, to make these concepts become realities.

The labs and the subsequent consultations are a great example of how a strong ecosystem can really drive collaboration and innovation.

A second Innovation Lab held in Vancouver in February 2018 was attended by representatives of the Port of Vancouver, the British Columbia Lottery Corporation, the Center for Social Innovation and Telus Corporation. The session was held at Telus’ state-of-the-art Innovation Centre, where startups, developers, university students and innovators can share ideas, gather different perspectives and gain insights, as well as experiment with the latest technologies. Telus encourages multi-sector participation at its Innovation Centre, including by its competitors.

The Centre “is a true testament to what companies can achieve when they are open to innovation and collaboration with other organizations across all sectors,” says Umalia President Lucie Bourgeois.

A third Innovation Lab is scheduled to be held in Montreal in the fall of 2018. Keep watching our newsletter for updates and insights on how these labs are creating the groundwork for business differentiation, opportunities and growth based on CSR and sustainability.

Umalia in The News!
Photo: Christian-José Surpris-Aho With the Montreal skyline as her backdrop, Lucie Bourgeois is seen standing at the head of the table – with author and CSR expert Neil Gaught seated to her left – as she welcomes guests to Umalia's 5th anniversary dinner celebration in October 2017.
Great food, ambience and discussions mark 5th anniversary dinner

Umalia celebrated its 5th anniversary in October 2017 by hosting a dinner for 25 distinguished, multi-sector business leaders, researchers and academics who were challenged to galvanize their thoughts on how the private sector can move ahead immediately to create positive social and environmental change.

There was a widely-shared recognition that business can no longer just be about chasing profits; that the old model predicated on “profit” being the sole motivation for business was antiquated.

About three-quarters of the 25 attendees represented a wide spectrum of private business ranging from large banks, apparel manufacturers, retailers, investors, and insurers to consultants, technologists, as well as food and agriculture specialists. The remaining 25 percent were from the non-profit sectors (foundations and NGOs), as well as from media and academia.

Great food and charming ambience in a fine restaurant overlooking the Montreal skyline put participants at ease as they engaged in a no-holds-barred, no-risk discussion about the role of the private sector in society.

Where are we? Where should we go? How can we get there? As one participant described:“There’s a train rolling down the track and we are all willing passengers on it. All open and passionate. But we don’t know where the train is going or how it will get there.”

There was consensus among the businesspeople that employees now look for purpose beyond their paycheques: they want to know that what they do in their jobs matters, in terms of being relevant to society. They also agreed that implementing policies based on CSR attracts a loyal following among customers.

But the question in some minds was whether a business case could be made for consecrating more money to implement positive societal policies which appeal to the higher moral instincts of customers. In other words, would the public pay more for a “responsible” product?

...a social conscience, in and of itself, is not enough to keep clients. Product quality is tantamount...

While CSR and sustainability initiatives are integral strategies for a business to differentiate itself, and surveys indicate that half of consumers are prepared to pay 10 percent more for such a responsible product, Umalia President Lucie Bourgeois emphasized a very important caveat: that the product itself must be at least as good – or better – than any other in the marketplace for it to gain share.

In other words, a social conscience, in and of itself, is not enough to keep clients. Product quality is tantamount, and trying to gain market share with a low price point is not compatible with positive societal values.

So while most of the businesspeople in attendance indicated that they would be willing passengers on the Purpose/ CSR train, they concluded that there is no one path to get there and that they need to share the experiences of others to figure out what would work best in their own business.

They are part of the 10 to 15 percent of “early adopters” businesspeople ready to engage right now, and as they move ahead as societal influencers, they can lead the way for other well-meaning businesspeople to follow once a path to success is seen.

But all in attendance agreed that the clock is ticking because of fast-moving technological and global trends which demand more transparency and sharing of the world’s resources with those in need.

Connect here to view a French-language video with English sub-titles of the October 2017 Umalia dinner with business leaders: https://www.youtube.com/watch?v=j4e_uBL6_2g&t=19s

Read a LinkedIn article about this subject: Getting closer to the Purpose Tipping Point: The power of uniting multisector innovative leaders