When sustainable property consultancy Viridis became the first Australian firm to achieve the International Living Future Institute’s JUST certification, it was a catalyst for some challenging conversations, according to director Jonathan Dalton.
For one thing, the certification process – which looks at 22 indicators across equity, diversity, workplace health and safety, supply chain, local control and content, investments and transparency – revealed the company scored no points for staff happiness, something that has required some serious thought.
Mr Dalton told The Fifth Estate the certification was pursued because it was seen as an important step in practising the kind of triple-bottom-line sustainability suggested to clients when providing sustainability consulting services.
It was also important to the firm’s staff.
“As a consulting organisation our value is in the team we have,” Dalton says.
“We do want to push ourselves for continual improvement, and JUST means we now have a benchmark we can assess ourselves against.”
Following certification, more reasons to have undergone the process emerged.
“It really does force you to open your eyes, and helps identify problems,” Dalton says.
There has been increased staff engagement, as some “tough things” needed talking about – including why people weren’t happy in their jobs.
There have also been benefits from a broader business perspective, with a number of companies already contacting the firm to talk about the certification and the positive things it says about the company.
“The way they saw it, if an organisation pursued JUST then it cares about its team. And that probably means it has low staff turnover, which means a client is more likely to finish a project with the same staff the project started with – and some projects can take years,” Dalton says.
Only 13 companies worldwide have achieved certification to date. One of the conditions of certification is the company must adopt, adhere to and make publicly available policies around all the indicators. The label is also publicly displayed, as the tool is focused overall on creating transparency about how companies operate in terms of social justice.
The whys of unhappiness, and the remedies
Dalton says that while the lack of any points for staff happiness could be seen as a liability out there where any headhunter or potential recruit could see it, it has also been the catalyst for positive change.
“That was confronting for an environmental organisation,” he says.
“We had been going through a difficult time for a number of years, since the GFC, and since then with other policy shifts, and it had been very much a tight-belt time.
“Now we are beginning to be able to loosen the belt.”
He says that during the tight period staff had needed to focus fairly closely on simply what billable hours they were achieving each month, and a siloed style of working had been the result. Since confronting the reality of staff unhappiness, active steps have been taken to build community within each office and between the Sydney, Brisbane and Canberra offices. And this is creating raised morale.
External factors contributing to the malaise have also been addressed. Dalton says the policies of the federal government had been taking their toll, but a shift in emphasis on the part of the company is creating new opportunities.
“It’s disheartening to work on something for years, and then the politics changes and it gets thrown down the drain. That affects morale of both staff and the company to have our work devalued,” he says.
“One way [we have found] to deal with it is to work with a wider view beyond ‘green’.”
The firm is now framing its services with a focus on the overall health of people, buildings and communities. The use of the word “health’” is key, Dalton says, as “no government is going to be discouraging health”.
“By changing the words we use, exciting things are happening.”
Staff malaise seen across sustainability industry
The sense of devaluation that affected his staff is one he sees across the industry.
“The people in the sustainability industry who are still in it are there because they have the passion [for sustainability] to stick with it through the tough times. Congratulations are due to anyone to anyone left standing after all we’ve been through.
“[As a nation] we have to pursue what’s good for the economy, the environment and the people or there will be a catastrophe in future [as a result of policy of government].”
One upside he sees is that if there is a change in the policy weathercock back towards sustainability, “it is easy to retake steps you’ve already taken.”
Essentially, he says the “health” messaging his firm is now employing encapsulates what people have always meant by “green”, where the benefits for people, the environment and the economy are all considered.
The new opportunities arising as a result are also enabling staff to look beyond billable hours to the bigger picture.
How the indicators shine a broader light on Australian business
The JUST process also revealed some differences between the US situation, where the assessment tool was developed, and the Australian one, as well as some areas where its language and methods could be improved.
For example, Viridis scored low on gender diversity, which looks for a proportion between genders in senior roles reflective of the population. Being a small firm with two female staff on maternity leave at the time of assessment meant the gender ratio looked imbalanced.
An issue also arose with the equity criteria on full-time employment. The staffing includes a number of employees who work part-time by choice. Dalton says he suggested to the LFI the criteria should more accurately ask, “How many of your staff who want full-time employment don’t have it?”
“Sometimes the words need more maturity,” he says.
Staff health, on the other hand, scored highly, because unlike the US our country still has – even if only by the skin of a senator or two – a functional national public health system in Medicare that is available to all workers.
Senior consultant Stephen Choi, who undertook the four-month process to analyse the company’s performance on the various indicators, says the paygap question was revealing in terms of how a firm in Australia compares to the context in which the tool was developed – massive US-based companies where the gap between the highest paid executives and the lowest paid is frequently a factor of 100 times the pay rate. Viridis has a much smaller gap.
He said there is a lot of research around each indicator that comes with the assessment tool.
Asking new questions
The supply chain questions covered areas the firm had not considered before, Choi says. Analysis was required of everything from sub-consultants to pens in terms of origin, and whether it was an ethical source.
The assessment also asked about the degree to which a business had an international supply chain or was internet-based. Choi says this led to reflection on the degree to which firms in the property sector outsource elements such as building modelling overseas because of the pricing benefits. The firm has not adopted this practice, and is now unlikely to as local control and local sourcing are the means to accrue points.
“Some things [it asked] had never been asked before in the company,” he says.
“Like the happiness survey… those questions are usually not asked, and I have not seen it publicly disclosed before by any company [in Australia].”
The anonymous survey asked all staff – from the CEO down to the lowest paid worker – to rate their satisfaction with the company, and also to rate how likely they would be to recommend it to others as an employer. It takes an average of eight out of 10 to earn the points for the criteria.
Divestment may be on the agenda
On investing the company scored poorly too. Dalton says that as a consulting firm, there are no substantial property portfolios or traditional investments. There is a bank account, and that pays staff, who are the firm’s actual “investments”.
The firm currently banks with one of the big four banks, and this is something it is now looking to change in order to improve the ethical investment score for the next assessment. On the upside, Dalton says its default superannuation firm for staff is already an ethical and just one.
“[The label] is not a perfect scale, but it’s a point in time,” he says.
The firm’s certification label expires in March 2017 but Dalton says he expects to seek recertification in a year’s time – and hopefully this time get better scores on critical points like staff happiness.
“The onus is on me to make sure things have improved,” he says.
A framework for betterment
The assessment is a combination of metrics, such as whether a firm is involved in the production of Red List chemicals, or how many women and men hold senior roles, and self-analysis.
Choi says the process was incredibly valuable to go through, and not a costly one, with a small donation of around US$500 the only direct cost.
“The value is enormous. Imagine having the framework to ask how happy are your staff? What is the pay gap in your company? Are we family friendly? Where do we do our volunteering? Are we providing a living wage? Where do we get our stuff?
“It is so valuable to have a means to start having those conversations. We so often focus on the easy things, not the bigger and deeper ones.
“The process has had a huge [positive] impact on morale, and on attracting staff.
“We are really far away from perfect, but now we really have benchmarking, and we have plans for what we are going to do next year [to improve].”