It’s the kind of nightmare interview question that might interrupt a CSR practitioner’s sleep: “take one sharpened pencil, a pad of A4, a twoyear timescale, and now tell us how you’d come up with a workable social investment policy for the UK’s largest listed company?” It may well get the consultants drooling, but one could excuse the prospective candidate for nervously nibbling their pencil down to a stub right there and then. And so it is to her credit that, 18 months down the track, Charlotte Grezo has seen Vodafone’s first ever Group Social Investment Policy signed off and is now onto her second pad of A4, marked ‘getting it implemented’.
Vodafone has been one of Europe’s stellar growth companies over the last decade. Although the telecoms sector might be experiencing a rough ride in the market at present, every day the company is serving over 100m customers in 28 countries around the world. Vodafone has been buying companies left, right, and centre over the last few years, chief among which was the Euro176 bn (£111bn) takeover of Germany’s Mannesmann in February 2000. The Group now contains 16 cellular network operators where Vodafone has more than 50% direct equity interest and has direct control over governance and management. There are also an additional 12 cellular network operators in which it holds a minority equity stake.
Such a meteoric rise has significant implications for Charlotte’s strategy puzzle. Firstly, just where do you start from, when there’s no established management system to govern the process or common value system to draw on? Secondly, how do you produce a strategy that provides a consistent direction for the Group, yet also allows for flexibility among its subsidiaries? And lastly, how do you position the company at the front of the pack where its size predicates it ought to be? Underlying Vodafone’s response to all these questions was its adoption of a values-driven approach. The starting point, therefore, became the Group’s internal core values and its business principles. One of these core internal values is ‘Passion for the World Around Us’ – which is more or less synonymous with CSR for external stakeholders. The Group vision and values were published in September 2001 with the Group Business Principles being approved in December 2001. Vodafone’s passions focus on the group’s commitment to its customers, employees, results and the ‘world around us’. Nothing devastatingly radical here perhaps, but neatly dovetailing with the Group’s social investment strategy concerns all the same.
If senior management – in the shape of the Group policy committee and the Group operational review committee (chaired by the chief executive and the Group chief operating officer respectively) – is ultimately responsible for the strategic consistency required, then it is to the newly-formed global ‘CSR network’ that Charlotte turns for the requisite flexibility. Made up of 80 or so representatives from a variety of functions across all of Vodafone’s worldwide operations, the CSR network meets regularly to shape and drive the Group’s social investment programme at the operational level. Charlotte is happy to see the Group CSR team in Newbury act as the go-between – communicating the Group’s vision, providing policy direction where necessary, ensuring subsidiaries are all chiming to the same ring-tone, and generally giving the subsidiaries’ community contacts the momentum to take up the social investment strategy themselves and run with it.
In its role as a catalyst for local ownership, the team organised a series of workshops for its global CSR contacts in 2001/2002. Representatives had the chance to share best practice and bounce ideas off one another. The dividends of such cross-fertilisation are already in evidence. A number of subsidiaries intend to replicate a programme presented by Vodafone Omnitel in Italy, for example, whereby registered blood donors in the Milan region are alerted to blood donation sessions in their area by text message sent by a leading Milan hospital.
Vodafone supports programmes that attempt to increase accessibility or that make creative use of mobile technology in the areas of arts and culture, community health, education and employability (see box for flagship programmes). This is true also for its environmental projects, which range from using mobile technology to track dolphins in the wild through to support for the Aid for Aid UK-based charity that provides mapping and communications support for humanitarian relief organisations responding to natural and man-made disasters.
However, to bring its existing activities into line with the company’s ‘passion for the world around us’, it was felt necessary to give a clearer definition to the priority areas for the Group collectively. Assessing how best the company could lever up from its day-to-day business activities and internal expertise, Vodafone defined the following priorities for its social investment:
Reaching out – sharing the benefits of mobile telecommunications as widely as possible, in countries where Vodafone operates and in those that have not yet shared in its technological developments;
Developing skills – giving people of all ages the opportunity to acquire the skills that will allow them to use new technologies;
Including those with special needs – supporting adaptations of technology to meet the needs of those with physical and mental disabilities;
Promoting sustainable business practice and environmental protection – helping to protect the natural environment globally, and in the communities where the Group operates, as well as supporting programmes that use cellular technology to help solve environmental problems;
Supporting community involvement – backing Group employees voluntary efforts to improve communities.
With its priorities in place, the company is willing and waiting for good project ideas, both from inside the Group and outside. Disability is an issue where the company is already on the front foot. Take Vodafone in the UK, which is now developing a range of complementary products and approaches for disabled and elderly customers, especially those who are deaf or with poor hearing, blind, with poor sight or who have poor grip or limited manual dexterity. The Vodafone website, for example, has a section containing information on a range of handsets for disabled and elderly customers, as well as making its customer brochure available in statutory large print and in Braille. Set up in 1997, six TFCAs were identified initially. Southern Africa’s first Peace Park, the Kgalagadi Transfrontier Park, was opened in May 2000 and since then tourism numbers have doubled on the Botswana side of the Park. The flagship project is the Great Limpopo Transfrontier Park. The first phase links the Kruger National Park in South Africa with the Gonarezhou National Park in Zimbabwe and the Limpopo National Park in Mozambique.
Some of Vodafone’s Group companies channel substantial parts of their community investment through foundations, sometimes established as part of a regulatory agreement. Increasingly, these are being voluntarily established by the operating companies. Vodafone decided to adopt this model of grant-making, setting up The Vodafone Group Foundation in June 2002 with a budget this year of £10 million. John Logan, one of the top echelon managers at Vodafone Group, was appointed as its first Director in June this year. About two-thirds of its total budget is earmarked for the company’s local foundations. In step with the strategy of flexibility and local ownership, the local foundations are encouraged to select new projects in line with the Group’s social investment priorities, while having the freedom to continue support for successful ongoing programmes that may not fit the Group’s new criteria. The remaining third is marked down for global programmes, which mirror the Group’s priority categories; using mobile technology to address social needs, protecting the natural environment, and supporting local communities.
The Vodafone Group Foundation was established as a separate legal identity. Not surprisingly, however, it is harmonised with Vodafone’s overall CSR programme, both at a strategic and management level. Commercially-driven programmes, such as research into mobile applications for users with disabilities, remain the function of the mainstream businesses and this ensures that core aspects of the businesses’ social responsibilities are kept within the mainstream, and not farmed out to the Group or local foundations. The establishment of foundations throughout the Group is seen as the best way to facilitate contact with non-profit and government actors, as well as giving real insight into emerging risk issues. The Vodafone Group Foundation is currently introducing the GIFTS software, which is designed specifically for measuring corporate charitable giving. This will be further developed to include the LBG (London Benchmarking Group) methodology.
Charlotte’s team is also responsible for developing reporting templates to measure and report key environmental and social impacts in a consistent way. To this end, the team is piloting a web-based data collection tool (which goes by the name of ENVOY) that will allow the Group CSR team and the Vodafone subsidiary participants to collect relevant information and data. The system is still in its assessment stage, but will no doubt contribute to the company’s effort to producing hard data concerning its key impact areas in the future. For now, Vodafone has just gone to press with its second CSR report, which sets out the company’s journey to date, as well as reporting on some key economic, social and environmental performance indicators.
Having identified its priority areas, Vodafone has signed up to a select number of membership organisations and policy forums with the aim of engaging relevant stakeholders. Its decision twelve months ago to enter into partnerships with Forum for the Future and Fauna & Flora International derive from a willingness to listen and learn collectively. Perhaps its most creative partnership is the Digital Europe programme, in conjunction with Forum for the Future, the UK nonprofit. Among other initiatives, this EU-backed initiative will research the role of mobile telecommunications in promoting sustainable social and economic development in Eastern Europe, and will survey the progress of the ‘mobile’ society.
The CSR team is currently working with market researchers, MORI, to consult with its key stakeholders, including investors, corporate clients and NGOs, while also expanding its existing consultation channels with other stakeholder groups. The dialogue process aims to provide the team with year-on-year perception data on the company’s CSR performance – information which will be factored into Charlotte’s strategy planning in the future.
Vodafone’s latest report testifies to how much has been achieved in a relatively short time, both in terms of a workable social investment policy and a ‘comprehensive, yet flexible’ approach to wider CSR issues. Clearly unfazed by recurrent interview nightmares, the policy ends with a promise to “regularly rethink and adapt our approach as we aspire to be at the leading edge of corporate social investment”. Still, better make sure that pencil sharpener’s not too far away!
Charlotte Grezo director of corporate responsibility Charlotte joined Vodafone in January 2001. She manages a core CSR team based at the company’s Newbury headquarters. She is responsible for the development and management of Vodafone’s CSR strategy, encompassing the environment, and wider economic and social issues, including community investment. She is educated as a scientist, with a Masters degree in applied hydrobiology and PhD in environmental biology – giving her a strong base for developing metrics to monitor, measure and manage environmental and social issues. Her career began as a lab technician at GlaxoSmithKline, after which she moved to British Steel (now Corus) in pollution control and then a spell as an environmental consultant with ERM. Her last role before joining Vodafone was as director of global environmental issues at BP, where she took a leading role in the company’s climate change policy. She has two children, aged nine and seven.
COMMENTS