Financial Times: reporting or leading business responsibility?
August 01, 1996
As Britain’s pre-eminent business newspaper, the Financial Times is a substantial commercial operation in its own right, with over 800 staff and annual turnover of ?160 million. Its parent company is Pearson with extensive regional publishing and other media interests.
As a company the FT has developed its own community involvement programme. As a publisher, it faces questions most other similar-sized companies don’t: should the paper simply report other companies’ CCI activities, or could it use its pre-eminent position to lead, raising expectations and setting standards? Does it have an editorial ‘line’ on what a turn-of-the-millennium company in a free-market economy should look like, and if so, how far can it push that vision given the reality today of many of its readers?
Internal programme management
The FT’s move in 1989 from its old City of London location to a modern building, south of the River Thames in inner city Southwark, made it a neighbour in a community with high rates of unemployment and urban deprivation. The focus of corporate donations and staff involvement became very local. The annual donations budget is around ?100,000, roughly equivalent to one per cent of notional pre-tax profit. But in addition to local projects and the matching of staff fundraising through a pound-for-pound scheme up to ?500, one national charitable cause is supported each year, chosen by staff.
Staff involvement is actively encouraged in three local schools. Some 70 staff regularly support a supplementary reading scheme over their lunch time period in two primary schools and around 20 staff act as mentors in the secondary school.
Volunteering is facilitated through the work place, to make available staff skills; examples include a management accountant advising a local group on finances and a member of the ad sales department helping with a marketing brochure. In addition a small number of 100 hour development assignments, for staff training, were previously undertaken but could not be continued on a regular basis, given the practical difficulties of absence from work during the daily rhythm of a press operation.
The FT supports Common Purpose in south London which brings managers from the private, public and voluntary sectors together in localities to build networks. Senior staff have also been on BITC Seeing is Believing trips, including the new chief executive, Stephen Hill.
Internal responsibility for community involvement lies with George Healey, head of human resources. The programme’s rationale is partly philanthropic and partly out of recognition of the HRM benefits, whether self development by staff or the sense of shared values which CCI engenders. A newspaper is a creative organisation, needing that ‘softer’ element as it copes with the tough business environment, with cost cutting and staff down-sizing inevitable.
External sponsorships
Given its standing, the FT is frequently asked to support events and causes. In July, it became lead sponsor of ABSA’s annual arts awards, with the presentation ceremony held in the new Globe Theatre, a recreation of the Shakespearian original a few hundred yards from the FT’s south bank office. The paper runs a respected arts page and – unlike some – makes a policy of crediting sponsors. The decision to agree the sponsorship, when approached by ABSA, was less a marketing initiative and more a natural ‘fit’ with the style of the paper and the interests of its readers.
The FT has developed a media partnership with Business in the Community and for two years has published BITC’s annual report through a special supplement distributed to every reader. Funded through advertising, half the surplus after deduction of costs is paid across to BITC as a donation, yielding it both enviable extensive coverage and a cash return.
The month of July also saw the launch of design contest for a new footbridge across Thames, to be built if Lottery funding is agreed. Run by Royal Institute of British Architects along with Southwark Council and the Corporation of London, FT Chairman, David Bell, is chairing the nine strong judging panel.
Editorial policy
Thus described, the FT’s approach to community involvement is not untypical. But potentially the largest contribution the paper can make, given its position as the journal of record for the business community, is through its own columns. The editor, Richard Lambert, defines the three basic editorial objectives of the paper as:
the provision of basic business data;
original, accurate, hard reporting of news and events;
coverage of themes, stories and ideas of interest to readers, such as the state of education and the role of business in society.
Under this last objective, the FT’s coverage of corporate social responsibility is arguably the best of the broadsheet papers. And asked if there will be more, less or about the same column inches devoted to the topic in five years time, the editor expects more. Companies like Hanson and BTR, which deliberately declined to get involved during the 1980s, are now showing signs of interest. There will be a continuing debate about role and rights of employees, for example, and companies will go on being concerned about the effects of inner city ‘ghettos’ and social ‘exclusion’.
The FT regularly features writers like John Kay and Charles Handy. Topics such as cause marketing and business ethics were included in the recent 20 part management education series. But the paper itself does not promote a particular vision of companies’ wider responsibilities, neither through editorials nor as a theme on the regular management page. It is not a campaigning newspaper, pushing a line, and is unlikely to run very far ahead of what business is doing and business leaders are saying.
Challenges ahead
But will plans for international expansion prompt a sharper stance? Already the paper is printed at eight centres outside the UK and it is no secret that FT is looking to grow internationally, as the globalisation of business and especially finance gathers pace. In continental Europe, there is strong interest in the UK’s recent experience of the changing role and responsibility of companies, as France and Germany in their own ways question the old certainties of the welfare state and social market capitalism.
To expand into the competitive European market, the FT’s core selling points will remain quality business data and hard accurate reporting; but it may need to articulate a stronger vision of the role of business in society – if not a campaigning stance, then at least a distinctive theme. Part of that package could be to highlight the pragmatic British experience of combining a still very active government with the business-like management of long term ‘destiny’ relationships in the community and among others with a stake in the company, distinguishing this from the rather different American practice – federal structure, strong local government, lower tax and a welfare safety net with big holes.
Contribution at home
Closer to home, the FT could help the CCI ‘profession’ to overcome the paucity of data and methodology in recording corporate community involvement. A tight definition of total community contribution is still lacking. Too few companies produce a figure beyond their UK charitable spend required by law. Compared to recent improvements in corporate environmental reports and the rigour of British Standards, quality awards and Investors in People, this is worse than an embarrassment; it is a hindrance to building better partnerships. Such data as is available is not published in a way that helps companies to benchmark themselves nor allows the other sectors, community groups and public policy makers, to know how best to work with business.
The problem is one of chicken and egg: journals like the FT will not publish data about corporate social responsibility until they are absolutely rigorous, hard, consistent and objective. But companies will not make the investment of effort (nor take the risk) of collecting data and making them available until there are demanding routes into publication. Then the best companies would want the publicity, and so achieve differentiation with lesser competitors, who in turn would be pressured to catch up.
So perhaps the biggest service that FT could make to community involvement in Britain is using its expertise as a collector and publisher of business information. The FT’s credibility would both reassure individual companies and spur them into action.
FactFile
Pearson plc
Year ended 31 December 1995
Chairman: Michael Blakeham
Managing director: Frank Barlow
FT chairman: David Bell
FT chief executive: Stephen Hill
FT editor: Richard Lambert
Main business: international media group, publishers of the Financial Times in UK and international editions and its electronic edition, ft.com; education, entertainment and investment banking interests include Addison Wesley Longman, Pearson television, Penguin, Tussauds Group, Mindscape and Lazards.
Turnover: ?1830 million
Pre-tax profit: ?365 million
Employees: 19,422 (11,543 in UK, 800 on the FT)
FT UK Top 500 ranking: 53
Charitable donations: ?1.1 million (?792,000 in UK)
Total community contribution: not calculated
Percentage of profit: 0.3%
Memberships: Per Cent Club (FT is a member of BITC)
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