Companies and institutions with over 25 employees would need to obtain a certificate of compliance with the rules, a process which involves classifying each position and reducing any wage gaps to less than five per cent. Firms would also be subject to audits to ensure continued compliance, with all entities certified by 2022. Any entity failing to take adequate steps would be subject to a series of escalating fines.

Introduced by the country’s centre-right governing coalition and supported by several opposition parties, the bill forms the centrepiece of the government’s plan to entirely eliminate the Icelandic gender gap by 2022.

The country has been ranked the most equal country under the World Economic Forum’s Global Gender Gap Index for the past eight years, but government statistics show that women still earn on average 17 per cent less than men. Both direct and indirect forms of pay discrimination are factors in the wage gap, according to the Icelandic government, but pale in comparison to other factors such as continued gender dominance in specific sectors, a lack of women in senior leadership and the outsized role women play as primary caregivers.

Iceland has taken steps towards addressing this gap such as introducing corporate board quotas and generous parental leave policies, but Thorsteinn Viglundsson, Iceland’s equality and social affairs minister, believes more aggressive action is needed to reach 100 per cent.

“The gender pay gap is unfortunately a fact in the Icelandic labour market and it’s time take radical measures; we have the knowledge and the processes to eliminate it,” Viglundsson said in an interview with The Guardian. He acknowledged that compliance would be a burden on public and private entities alike, but that the obvious company-wide and societal benefits were too important to ignore. The legislation is modelled after an equal pay pilot program begun in 2013.

Business groups like the Confederation of Icelandic Employers have spoken up against the bill, but a recent poll conducted by Market and Media Research found only 20 per cent of the population against the effort. The groups most in favour were 18 to 29-year-olds and women in general, as well as a surprising level of support among older voters over 68. Voters for the right-leaning populist Progressive Party and wealthier voters were the most opposed.

The post Getting to equal appeared first on Corporate Knights.

American apparel and footwear company VF became the latest corporation to overhaul its sourcing policy targeting deforestation and human rights violations in the supply chain. The North Carolina-based firm, which owns more than 30 brands including Timberland and The North Face, unveiled its inaugural Forest Derived Materials Policy in late February. It instructs suppliers to prioritize the use of recycled materials whenever possible, as well as FSC-certified paper and fibre when using virgin materials. The company has also signed on to the Canopy Style initiative, an effort by environmental NGO Canopy to phase out the use of ancient and endangered forests to produce forest-derived fabrics like rayon in the textile industry by the end of 2017.

“Deforestation and forest degradation continues to be a global issue affecting climate change and human rights,” Letitia Webster, VF’s VP of global corporate sustainability, said in a statement. “This policy provides clear guidance across our many purchasing categories and it enables us to play our part in protecting the world’s forests.”

Rayon, an inexpensive alternative to silk, is a synthetic cellulose fibre prized by apparel companies for its flexibility. It is derived from a chemical process using tree pulp, which a groundbreaking investigation by Canopy five years ago concluded wastes up to 65 per cent of the tree. Demand for the product has spiked in recent years as performance wear has grown in popularity. This has placed greater pressure to clear forests in Indonesia and the Amazon basin to set up plantations of various pulpwood species such as Acacia. Canada’s boreal forest is another top source for pulpwood.

Canopy hailed VF’s policy announcement as a step in the right direction, bringing dozens of well-known consumer brands into the Canopy Style initiative that already lists over 65 new brands and producers as members. “When an apparel giant like VF expands its forest commitment with a policy like this, it adds incredible momentum to global forest conservation and climate efforts,” said Nicole Rycroft, executive director of Canopy. “From hang tags, to packaging to fabrics, some of America’s favourite global brands are protecting the world’s forests and the species that call them home.”

Zero: Princess Cruises

Princess Cruises will pay a $40 million fine for deliberate vessel pollution and subsequent cover-up after the settlement was approved by a U.S. district court in April. It represents one of largest penalties ever levelled against the cruise ship industry.

A subsidiary of Miami-based industry leader Carnival Corporation, Princess Cruises pleaded guilty to seven felony charges for illegally dumping oiled waste into the ocean that had not been properly treated. This practice occurred for at least eight years aboard the Caribbean Princess, and included the use of what investigators described as a “magic pipe” to circumvent environmental monitoring equipment.

Authorities were alerted after newly-hired Scottish engineer-turned-whistleblower Christopher Keays observed untreated wastewater being discharged off of British waters in 2013. According to court documents, Keays went on to document the practice through photos and video secretly taken on his cellphone. He was awarded a $1 million reward as part of the settlement.

“Let’s be very clear: Princess [Cruises] engaged in exceptionally serious criminal offences,” Assistant Attorney General John Cruden said at a press conference announcing the plea agreement last December. “It deliberately violated the international law regime designed to make sure that our precious oceans are protected.”

After Keays reported the environmental violations to British authorities, the ship’s senior engineers tried to hide the evidence and convince junior staff to lie about the incident. The U.S. Coast Guard was tipped off by its British counterparts and examined the vessel upon its arrival in New York, launching a broader inquiry into the company’s compliance culture.

Investigators with the Department of Justice eventually concluded that similar practices were used on at least four other ships operated by Princess Cruises, including the emptying of greywater tanks directly into the ocean after reaching storage capacity. All greywater is supposed to be collected and offloaded for treatment after reaching port.

The court order also mandates a five-year environmental compliance regime for the Princess Cruises fleet and related Carnival-owned cruise lines operating in U.S. This will be overseen by a court-appointed monitor and include independent audits conducted by a third party.

The post Heroes & zeros: VF and Princess Cruises appeared first on Corporate Knights.

The 2017 Best 50 Corporate Citizens in Canada ranking was sponsored by CIPEC – the Canadian Industry Program for Energy Conservation – which helps organizations increase profits by improving energy efficiency and reducing greenhouse gas emissions.

Click here to go back to the ranking landing page.

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Canada’s largest community credit union has been tackling some top-of-mind social issues ranging from racism and refugees to gender equality and affordable housing. Meantime, its membership and assets under management keep growing. Today, Vancity manages about $25.6 billion in assets, up seven per cent from 2015, and has a goal to grow that further to $40 billion by 2020. It wants to see its membership reach 600,000, up from about 523,000 today.

“Even though we’re good, we always think we can aspire to be great,” says Vancity president and CEO Tamara Vrooman, who oversees the credit union with 59 branches in Metro Vancouver, the Fraser Valley, Victoria, Squamish and Alert Bay in B.C.

“We are always looking for ways to improve our performance even when our performance is, relatively speaking, very strong.”

It’s that never settle, do-better attitude that has helped Vancity land the title of Canada’s Best Corporate Citizen in 2016 for the second year in a row. The credit union also earned the top spot in 2013. It placed second in both 2014 and 2015.

Vancity’s overall score was 73.8 per cent in the latest ranking, the highest among the nine financial institutions included. Desjardins placed second and HSBC Bank Canada was third, while the Big Six banks rounded out the rest of the list, led by RBC. (Full disclosure: Vancity is a minority investor in Corporate Knights. It played no role in compiling the rankings.)

Vancity had some of the best scores in most of the 10 categories relevant to the financial services industry, including energy and waste productivity, gender diversity and low employee turnover. Its lowest scores were for water use and taxes paid.

Do good, but can do better

While some organizations may get defensive when addressing their lowest scores, Vancity sees it as an excuse to do better.

To help lower its water use, also flagged as a weakness in previous rankings, the credit union has been installing low flow and time-release faucets in washrooms and kitchens across its operations. It’s also working on eliminating the use of irrigation systems, where allowed, and moving to drip irrigation where those systems are required.

“I hope the next time we measure up on the water side we’ll see a significant improvement,” says Vrooman. “We do pay attention to the data and we do look for ways to continue to improve.”

Vancity also scored lower on the ratio of cash taxes paid, which Vrooman says is due to some tax losses carried forward and tax credits it took advantage of in previous years. Vancity says a special deduction for credit unions has since been phased out at the federal level, meaning credit unions are now being taxed at the same rate as banks and other large corporations. The province is also reviewing whether to continue with a similar tax credit offered to credit unions.

“If you look historically, over a longer period of time, the taxes are more stable,” Vrooman says.

Tipping the scale on gender diversity

Vancity continues to score well with gender diversity and actually tips the scale in the opposite direction compared to most organizations across Canada. Among four executives that currently report directly to Vrooman, two are women and two are men. Eight of its nine board members are women, up from six out of nine in 2015.

Vrooman says they have an equal number of women and men vying for board positions, which are a three-year term. In recent years, members (also represented by roughly an equal number of women and men) have been electing more women, she says.

“We put a very balanced and diverse pool of candidates out to the membership.”

Vancity is also well known for products and services that help to address some of society’s most challenging issues, in particular those faced by its core membership in and around Metro Vancouver. Examples include its mixer mortgage, which helps one or more roommates, co-workers, friends or family members buy a home together; Visa cards with profits that go towards environmental causes, and the “fair and fast” loan that claims to be friendlier and more affordable than traditional payday loans. A couple of years ago, Vancity also unveiled Canada’s first 100 per cent fossil-fuel-free mutual fund. Most recently, it launched Vancity Community Investment Bank, Canada’s first Schedule 1 community-investment bank focused exclusively on the triple bottom line.

A ‘force for good’

“Vancity is trying to advance the credit union in a way that it’s a force for good,” says Coro Strandberg, a sustainability strategist, president of Vancouver-based Strandberg Consulting and former board member at Vancity from 1987 to 2000. “By banking with Vancity, you become part of a community of people who are fostering a sustainable community.”

Strandberg says it’s a virtuous-circle business model that also makes good business sense.

“The more they grow, the more social good they can do, the more people will be attracted to them, bank and do business with them,” says Strandberg. “This is the new approach to CSR [corporate social responsibility]. More and more companies, now and in the future, will be pressed to find their own social ambition and build it into the core of what they do, which is what customers, employees, governments and the public are looking for.”

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One persistent thread of the nascent Trump era is the stark divide between corporate America and the White House on many of the issues du jour, particularly when it comes to questions of diversity and inclusion. Some of these are explicit, such as vocal opposition and fierce lobbying against the president’s religious liberty executive order or the proposed travel ban.

Other moments have been unintentionally revealing, including this year’s parade of Super Bowl ads. Innocuous corporate messaging took on a greater significance in the week after the chaos of the original travel ban. Coca-Cola aired its multilingual version of “America the Beautiful” – not so the company would be seen as joining the anti-Trump resistance but more likely because the ad reflected broad themes that its target demographic wants to hear. This rift will only grow more pronounced in the years ahead.

The 2017 Deloitte Millennial survey conducted across 30 countries last September found that 87 per cent of millennials believe “the success of a business should be measured in terms of more than just its financial performance.” Younger Americans and Canadians are more likely to work for companies that share their values, as well as purchase their products and use their services. These values include greater environmental awareness, a greater acceptance of LGBTQ communities and less suspicion of cultural minorities, among other things. While a much-discussed Angus Reid poll released in October 2016 found that 68 per cent of Canadian respondents said minorities should be doing more to fit in with mainstream society, 53 per cent of millennials disagreed with that sentiment.

Millennials will comprise around 50 per cent of the global workforce by 2020. Both they and Generation Z (kids under 18) will be the most diverse cohorts in history, with nearly 25 per cent of Canadian millennials classified as visible minorities in the 2011 census data. In the U.S., whites comprise only 51.5 per cent of Generation Z. Companies need to draw from the deepest pool of employees to stay competitive, which means corporate policies that make this multicultural cohort feel welcome are imperative. Employee and management diversity in both composition and outlook also creates a more innovative business that is able to steer away from the perils of groupthink.

Companies that fail to move in this direction are not only reducing their pool of potential talent and customers, but run the risk of blowback from employees and consumers alike. The #DeleteUber boycott first forced Uber CEO Travis Kalanick to step down from Trump’s economic advisory panel in February, and then picked up steam again later that month when a former female engineer at the company published an open essay accusing the company of covering up sexual harassment in the workplace.

This isn’t to say that an increased focus on diversity and inclusion in the workplace is inevitable. The Ontario Securities Commission released its newest report in March evaluating board and executive officer female diversity on 677 TSX-listed companies, and there is some notable corporate leadership on display (see here for a list of the top companies).

But 304 of the companies listed failed to have any women on their board. An additional 157 companies did not have any women in senior management. Only 46 corporate boards were more than 30 per cent female, and only 102 firms had more than 30 per cent women in senior management. This, of course, is only one facet of diversity.

Some Canadian workplaces are slowly becoming more welcoming to women, people of colour and LGBTQ employees, and these lessons should be adopted as widely as possible. Internal targets, recruitment programs and groups like the Canadian chapter of the 30% Club all have a role to play here, as do more blunt tools like legislation imposing quotas (see here for a broader meditation on this topic).

Together these elements can all contribute to a shift away from a culture of compliance as part of a longer-term growth strategy.

The post Editor’s note: A seat at the table appeared first on Corporate Knights.

Just 26 years old at the time, Adèle Hurley teamed up with fellow Canadian Michael Perley to help found the CCAR and act as its chief lobbyists and executive co-ordinators. Starting out with 12 core organizations, the group eventually encompassed 58 member groups representing over two million Canadians. It was also one of the first times that Canadians had set up a public advocacy campaign in Washington, D.C.

With the passage of amendments to the U.S. Clean Air Act in November 1990, the establishment of the Acid Rain Program and commensurate regulatory action on the Canadian side, the group was disbanded. Since then, Hurley has been heavily involved in a variety of cross-border air and water issues. She has served as the Canadian co-chair of the International Joint Commission which oversees the Boundary Waters Treaty of 1909 between Canada and the United States, as well as the director of the Program on Water Issues at the Munk School of Global Affairs at the University of Toronto.

She was awarded the 2017 Corporate Knights Award of Distinction in June for her tireless efforts to protect Canada’s natural resources. She recently sat down with our editorial team to reflect on the acid rain years and the CCAR’s legacy.

CK: How did your involvement in the CCAR first come about?

Hurley: I was working at the time in the Ontario legislature as a researcher, and went specifically to hear a presentation about acid rain by Dr. Harold Harvey out of the University of Toronto. A few professors like Dr. Harvey and Dr. David Schindler were trying hard to convince politicians, even in the early days, and journalists that something was amiss in the lakes.

Harvey was showing the research that he and his graduate students had assembled from Killarney (on the shore of Georgian Bay in Ontario), using secchi disk readings and acidity data. He explained to the committee how stories about people catching huge fish on lakes in the area were painting a false sense of security. That what you really wanted to find was the young-year classes of fish, because the fear was that those newly hatched fish were being killed off by the acidic runoff in the spring. Fish from those young-year classes were going missing and, as Dr. Harvey explained, those older, larger fish you were seeing were actually slowly “marching off into extinction.” That phrase caught in my mind.

CK: There’s something so vivid about the threat posed by acid rain.

Hurley: A great quote came years later from Margaret Atwood, when she was asked by some Americans why Canadians were so up in arms about that acid rain problem. And she said, in her droll way, “It’s the cottage.” Well, what does that mean? “The cottage is childhood,” she said.

Cottagers became incredibly important for this issue over time, in terms of helping to mobilize support but also in terms of fundraising. Many of the cottagers were Bay Street by day and cottagers in the summer. I don’t think many people grasped that for many years. This was crucial because if you were going to comply with foreign agent legislation in the U.S., we couldn’t have government funds. Private fundraising was paramount for a Canadian non-profit operating without any government support in the U.S.

CK: How did CCAR navigate within the ecosystem of interests and power centres that were ultimately pivotal in successfully combating the acid rain threat?

Hurley: From the outset, Michael and I and our board pretty much agreed on what we thought would be the important components involved in the set-up and operation of this campaign.

The first was the decision to form a coalition. This was critical, as it contained varied strengths that you could pivot and draw on at any given time. You could pull in tourism outfitters at certain points, forestry people, environmentalists, health experts, First Nations, cottagers, etc.

Sometimes we’d say that you’re better being your own mug, as the saying goes. Today we should speak as a coalition, or maybe we’ll put these three organizations together for their own statement. If it was a situation involving Quebec, Acadia or New England it would be our Quebec members talking to one another, and Michael would handle that completely in French. It gave us the ability to leverage that continental reach into Washington, Ottawa and Quebec media all at the same time.

Another pillar was not presenting ourselves as Canadians. I don’t mean that we were hiding this fact, but we simply appeared before Americans with the understanding that our meeting time was about enlightened self-interest. So if you’re from Pennsylvania, that’s all we’re talking about. And not the state in general, but your district in particular.

We also studied Congress extensively. We knew which votes we’d always have and could bank on – all we did was provide them with the most up-to-date science. There were also the ones we’d probably never get, and we tried to be respectful and not spend a lot of time on that. Most of all, we focused on the swing votes, and worried about the ones that might walk.

CK: How were duties split between you and Michael Perley?

Hurley: Our roles seemed to evolve quite naturally. I tended to focus on the overall strategic direction, after which Michael would fill in the necessary research details and take the lead on communications.

He’s a very organized speaker. He thinks before he speaks, and would always lay out our core message in quick bullet points at the top of any appearance. When you’re on an issue for that many years, the media comes to have a certain expectation, and even joy, if this was going to be the person explaining the latest development on the Hill or at a bilateral meeting. So he built up a following, because he managed to establish firm credibility in the eyes of the media. Excellent writer, articulate, no cheap shots, a little bit of light humour from time to time, but mostly just the facts.

That left me time to be on the Hill doing office meetings, sitting down with U.S. NGOs, reading the congressional record and publications like Business and National Affairs because every morning the information poured in. I’d go to committee hearings during the day, but the best time to work with the staff was around 6 p.m., when members of Congress were off on the cocktail and fundraising circuit and staffers were preparing for the following day.

That’s where we formed relationships with people who eventually started to count on us for the latest updates regarding their district. Obviously they’d fact-check it but after six years, if you hadn’t been making any mistakes, they were waiting. That’s why the congressional system needs to be monitored so carefully, because it really is open. Votes can flip pretty quickly.

CK: What were some unconventional strategies employed by the CCAR?

Hurley: One example of this was we put together a group toward the mid-to-latter years called the American Friends of Muskoka. It became essential because we saw the importance of the delegations from the Midwest. Many of the American Friends of Muskoka were influential senior Republicans from that region, who found themselves downwind in the summer from their own emissions back home.

American cottagers were writing to one another on the lakes in the summer, bringing each other up to date on the science and on the politics of acid rain in both countries. Several were CEOs and leaders of multinational companies, including heavy industry. At one point they convened a lovely summer cocktail reception, and invited the secretary of transportation in the Reagan administration to come and deliver remarks while he was in Canada fishing.

Very convivial, antique boats and people enjoying themselves, but a strong message was being sent directly to U.S. Midwest congressional leaders and Washington that this was important and not solely a Canadian or New England issue.

CK: Federal Green Party leader Elizabeth May has argued that Canadian government leadership and civil society engagement has never occurred as successfully as it did in that era.

Hurley: It certainly became a successful continental collaboration over time.  Interestingly, a level of difficulty occurred once it was Canada’s turn to clean up. After all the work we did in the U.S., it turned out that Ontario Hydro was one of the toughest emission control orders to nail down.

After many years of Canadians having had their noses pressed to the glass, furtively following what was going on in the U.S. it was time for us to clean up our contribution to acid rain in our own country. I recall that we weren’t very popular in some quarters at the time. It sometimes felt like we were handing out detentions.

Eventually, Canada’s approximately 50 per cent contribution to emissions that were causing acid rain in this country were brought under control and, together with the U.S. emission reductions, have protected moderately sensitive regions of this country.

On November 19, 1990, the CCAR happily threw a farewell party at Casa Loma in Toronto. Hundreds of supporters turned up and were charged admission because, as the invitation said, “We got smart but we never got rich.”

The post Who stopped the (acid) rain? appeared first on Corporate Knights.

It was quite the mood swing for the Skoll World Forum, a global meetup for social entrepreneurs inspired by Canadian Jeff Skoll, who was eBay’s first president and now spends his time founding organizations that address global social, medical and economic ills. In its 15th year, Skoll World adopted the tough-love theme, “Fault Lines: Finding Common Ground.” Attendees were in a cautious and defensive mood, given the rise of Trump, Brexit, and us-versus-them politics.

In her opening remarks, Skoll Foundation CEO Sally Osberg tackled that struggle head-on, expressing the hope that “exposed fault lines” may actually encourage change, by drawing attention to unsolved problems and forcing activists to listen harder, think more creatively and develop more innovative partnerships. Here are seven takeaways from Skoll World 2017 that suggest the future is still social:

1. Entrepreneurs are redefining the nature of business. The conference opened with an interview with Hamdi Ulukaya, founder and CEO of Chobani, the New York company behind America’s leading yogurt brand. Ulukaya challenged the notion that businesses exist only to turn a profit. Born into a Kurdish farming family in Turkey, Ulukaya has made a point of hiring refugees (they now make up a fifth of Chobani’s workforce), and he created the Tent Foundation to help refugees around the world. Ulukaya also believes in sharing; last year he promised that when Chobani becomes a public company, he will gift 10% of his own shares to his employees.

Ulukaya told forum attendees that he is trying to build a business based on fairness and generosity – principles he learned from his mother. “I never thought I would get involved with business. I was always thinking I was on the other side,” he said. He shares critics’ anger at unsavoury business practices, but says his job at Chobani is to be “a competitive innovator, and channel that anger into the marketplace. The good people have to win.”

Ulukaya’s work proves that good examples can make a difference. Through Tent he has cajoled 70 companies, from Accenture to Zynga, into donating money, services or technology to support refugees. Business, he says, “is still the most effective way to change the world.”

2. Embrace your critics. Another trailblazing speaker was Jim Yong Kim, president of the World Bank. Founded to promote prosperity in the developing world, the bank has often been criticized for encumbering poor nations with unwanted projects and bad economic policies. Kim himself was one of those critics. As a physician and co-founder of a not-for-profit that delivers health care to the world’s poorest regions, he opposed the World Bank’s “trickle-down” economic policies and called for its complete abolition.

As president, Kim redirected the bank’s resources to combat the 2014 Ebola pandemic when conventional health-care organizations were slow to act. Later, he brought health experts together with the reinsurance industry to create a new “parametric” insurance program that will free up emergency funds at the first sign of future pandemics – supported by insurers in hope of reducing the life-insurance and business-interruption claims that generally follow epidemics. “The incentives are aligned,” announced Kim, “so this [the slow response to Ebola] will never happen again.”

3. Serious Celebrity No.1. Jeff Skoll ended the first day by handing an “Honorary Skoll Award” to Don Henley, founder of the Walden Woods Project, formed to protect Henry David Thoreau’s historic Walden Pond, near Boston. You may know Henley better as co-founder of The Eagles. “The first songs I learned on guitar when I was 13 were Eagles songs,” said Skoll. In accepting his award, Henley took a serious turn. He noted that Thoreau, as writer of both Walden and an anti-slavery essay called “Civil Disobedience,” is considered a founder of both the environmental and social justice movements: “two distinct yet related sets of moral imperatives.”
4. Fighting fake news. Day 2 started with an example of how philanthropy can counter intolerance. As part of a special panel on “The Future of Media,” the Omidyar Network, a social investment firm established by Skoll’s former boss, eBay founder Pierre Omidyar, announced a US$100 million fund to support investigative journalism, strengthen independent media and counter the spread of misinformation. As panel moderator Pat Mitchell noted, “You can’t have a free and open society without free and open access to information that is reliable.”
5. Reach out and touch someone. You don’t have to be a philanthropist to make a difference. Just do what you can, when you can. That’s the message of Dorcas Mensah, a 24-year-old Ghanaian studying international development at the University of Edinburgh. She told the conference that when she was invited to do an internship at a London bank, she lacked both the professional clothes and spending money to make the right impression. “I couldn’t show up in jeans,” she said.

Two strangers came to her rescue. A business owner she knows only as “Mr. Biney” gave her 500 pounds for clothes and the occasional tea. And a woman she never met, calling herself “Auntie Sheila,” paid for a shoe-shopping spree. Mensah’s challenge to the Skoll attendees: Recognize your power to help others. “Be Auntie Sheila, be Mr. Biney: people who are not afraid to help others. Let your light shine.”

6. Serious Celebrity No. 2. The Skoll Foundation presents a “Global Treasure” award to extraordinary people addressing pressing problems. This year’s winner was Bono, lead singer of U2, for his co-founding of non-profit organizations fighting AIDS and poverty. Bono and Skoll are also co-founders of Rise, a new social impact fund that will invest in worthy businesses such as health care and clean energy, or housing and education in developing economies.

In accepting the award, Bono noted that “Capitalism is not immoral, but it is amoral. You have to tell it what to do.” Asked by Skoll how he reconciles serious activism with the life of a pop star, Bono said he and his bandmates agreed early on that the only way to justify their commitment to music was by working on social issues off-stage: “That gave us permission to be in the band.”

7. It all comes down to politics. Harvard business professor Michael Porter ended the conference by warning attendees they had to pay more attention to the self-serving structure of politics. Porter, who specializes in competitiveness, says he began looking at politics last year only reluctantly. “I never thought government was important,” he said. “I thought it was a sideshow. But it’s not. We need government to make good choices.”

Porter reached this epiphany after he and his Harvard colleagues reviewed all the painstakingly researched, cutting-edge advice they had given governments about promoting prosperity – and found none of it had been adopted. While he studied the U.S. scene, he said the same general problems can be found throughout the world: ongoing failures to reform health care, taxation, education and infrastructure to ensure that people prosper along with corporations. Porter’s conclusion: “Our system is not designed to deliver solutions. It’s designed to advance the interests of the system itself, starting with our political parties.”

To fix the system, Porter said, we need campaign-funding reform, new processes for selecting candidates and ranked-choice voting (which lets voters pick second, third and fourth choices). None of this will come from the politicians, he warned: Voters must demand it. “We can change the way political systems work. But it’s not going to happen naturally.”

It would be an exaggeration to say that Skoll World attendees left Oxford with a spring in their step; there was too much work ahead. But the annual progressive clambake ensured that no one would be doing it alone.

The post It’s a Skoll world appeared first on Corporate Knights.

So when I had three random interactions all pointing in the same direction, I decided to take a closer look. It led me down a path to a $2 trillion pot of gold.

The first interaction was with former Corporate Knights and current Sustainalytics research sage Doug Morrow. Over some pizza pies, Doug could barely contain his enthusiasm for a simple but powerful idea he had come upon while working on a paper (“ESG risk in default funds”) for the U.K.-based Pensions and Lifetime Savings Association (PLSA): Why not make the pension plan default option – used by nine out of every 10 members – one that invests in companies with advanced social and environmental practices? In the paper he reasons that low-cost sustainability index tracker funds can provide a hedge against a host of intensifying risks including climate change. As Luke Hildyard from the PLSA puts it: “We no longer understand [sustainable investing] as a niche product designed to enshroud investors in a warm glow of righteousness, but as a critical component of the wisest investment strategies.”

The second interaction happened at a Chemistry Industry Association of Canada conference focused on green economic opportunities. An audience member named Anne-Sophie Tétreault got up during the Q&A to ask why we were only talking about such opportunities for companies and not their pensions as well. She shared her experience as the lone voice at a 2004 general meeting of FÉRIQUE (the pension fund group for Quebec engineers), pointing out the first duty of an engineer: to respect their obligations towards humanity and take into account the consequences of the performance of their work on the environment and on the life, health and property of every person. Why, she asked, should her retirement fund be exempt from this? That led to FÉRIQUE inviting Anne-Sophie to sit on a committee working towards a better answer. Today, the group flexes its financial muscle and proxy power through the FÉRIQUE Funds to nudge companies toward more sustainable practices.

The third time was on Earth Day. I came across a tweet that Desjardins Group Pension Plan had invested $750 million of its $11 billion employee pension in a series of green energy installations. So I decided to do some of my own digging to get a better sense of what syncing the wealth of Canadian pensions with the health of the planet might mean.

According to Statistics Canada, 6.3 million Canadians have public or private sector pension plans with a total value of just over $2 trillion at the end of 2015. That works out to an average of $319,000 per plan member. Using a standard benchmark (MSCI World) with a carbon footprint of 160 tonnes per $1 million (U.S.) invested, that means each pension is generating 37 tonnes in carbon emissions, or almost double the 20 tonnes emitted by the average Canadian’s lifestyle. This doesn’t just apply to carbon. Whatever you do in your daily life, your pension investments could be generating double the impact for better or worse.

Aside from what pensions mean for planetary health, they matter a lot to plan members’ financial well-being, accounting for 36.7 per cent of their net worth. But there could be a problem on the horizon. Pension fund guru Keith Ambachtsheer has calculated that 3.6 per cent is now a reasonable long-term expectation for a broadly diversified stock portfolio. This compares poorly with the 1871-2014 realization of 6.7 per cent. Ambachtsheer suggests that a strong understanding of how a corporation creates sustainable value over time can go a long way to creating a sustainable alpha return for investors, making up the lost three per cent. To back this up, he points to pioneering research being done by George Serafeim out of the Harvard Business School demonstrating how companies with good performance on material sustainability issues for their industry significantly outperform companies with poor performance over a 20-year time period.

So why isn’t everybody doing this already? For the big plans, it’s mostly a function of status quo stickiness. A new non-profit named Shift, backed by a mix of eco-folk and Bay Street brass, has been formed to empower plan members to make pension wealth and planetary health the default offering for pension plan members. In the meantime, are there any early takers?

Will it be the Top 100 Pension Funds with combined assets pegged by Benefits Canada at $1.2 trillion? Or, maybe the Top 50 Defined Contribution Plans (with $34 billion in combined assets)? Or why not the Best 50 Corporate Citizens in Canada, 96 per cent of which have a defined benefit and/or contribution pension with combined assets of $180 billion?

It would not be a bad deal for employees: working for a company you can be proud of that lets you invest in a world worth retiring in.

All with some extra cash in the jeans.

The post The people’s pension power appeared first on Corporate Knights.

Today, the corporate lawyer and partner in the firm’s Toronto offices has a Pride flag on her desk. She’s involved in Blakes’ employee resource group on behalf of its lesbian, gay, bisexual, transgender and queer (LGBTQ) staff members. When she interviews law students interested in joining the firm, “almost everyone I speak with asks about diversity, regardless of their personal circumstances. And when we recruit young [LGBTQ] lawyers, they are, by and large, out in the recruiting process.”

When Smith tells new hires her story – how it took a good five years for her to feel comfortable enough to come out at work and to bring her partner to a corporate social event – “it doesn’t resonate. They just look at me, confused. They can’t imagine not being their whole selves at work.”

According to a recent report by Great Place to Work and Pride at Work Canada, business leaders across the country now recognize diversity – including that of sexual orientation, gender identity and gender expression – as a competitive advantage. The report notes that 85 per cent of organizations have a diversity team or person whose mandate explicitly includes LGBTQ employees, and 62 per cent have an LGBTQ champion at the C-suite level. Pride at Work Canada, which works with industry partners to foster LGBTQ diversity and inclusion in the workplace, had 50 partners in 2014, notes its executive director, Colin Druhan; today, it has 83. From the Big Banks’ sponsorship of Pride events to de rigueur LGBTQ employee resource groups to increasing coverage for gender-affirming surgeries (currently, 11 per cent of organizations offer such benefits to their transgender employees), the past decade or so has seen some visible gains in terms of LGBTQ rights in the workplace.

Those gains, in many ways, are uniquely Canadian. In contrast to the United States, where anti-gay discrimination is still legal in nearly 30 states, Canada’s LGBTQ populations have implied protections under Section 15 of the Charter. The Canadian Human Rights Act protects LGBTQ employees from employment discrimination; Bill C-16, currently awaiting Royal Assent, was put forth by the sitting Liberal government to update the act to include the terms “gender identity” and “gender expression.”

For all the positive change, however, cautions Druhan, there’s still much more to accomplish. A recent study commissioned by Telus found that one third of the 814 respondents (half of whom identified as LGBTQ) did not find their workplaces safe and inclusive for lesbian and gay employees; 45 per cent said the same for trans workers. Nearly a third of respondents said they had experienced or witnessed homophobic or transphobic discrimination or harassment at work – with fewer than 40 per cent of these incidents reported to employers.

While being out has arguably given more visibility and opportunity as leaders to employees like Blakes’ Smith or Kimberley Messer – who represents IBM Canada’s Global Diversity Business Development team focused on workforce diversity and LGBTQ markets – 35 per cent of respondents aren’t convinced that LGB employees have opportunities to be promoted to senior leaders; for trans workers, that number rises to 52 per cent. Perhaps for all of these reasons, nearly 60 per cent of LGBTQ respondents said they were not fully out at work.

And that takes its toll, particularly in highly intensive, competitive environments where teamwork is key. “Corporate law is a pretty intense practice,” says Smith. “I spend more time with my colleagues than I do with my partner or my family. And when you can’t be your whole self at work, that can have a negative impact not only on you but on team dynamics and morale.”

LGBTQ employees who are closeted face the stress of “constantly having to obfuscate” about their partners, their activities, their identities, says Sarah Kaplan, a professor at the University of Toronto’s Rotman School of Management and director of its Institute for Gender and the Economy. Those workers who are partially or even fully open about being LGBTQ still face the stress of mentally auditing each new situation for potential hostility; coming out to each new hire or manager; being misgendered; or choosing whether to correct a client who notices a wedding ring and asks about a gay man’s “wife.”

That accumulated stress, says Kaplan, amounts to a mental “tax” on LGBTQ workers. “Some percentage of their energies is being spent on constantly coming out or constantly being in the closet, and that means that they are not able to focus all of their energies on doing the job. If you’re an employer, you should be very worried about that.”

Indeed, having fully-engaged team players is one compelling business case for creating LGBTQ-friendly workplaces. As Smith’s experiences make clear, recruitment is another: the Telus study reported that 56 per cent of Canadians and 86 per cent of LGBTQ Canadians are more likely to consider working for businesses that support the LGBTQ community. Respondents also perceived LGBTQ-friendly workplaces as better corporate citizens, more innovative and more understanding of their customers’ needs. As IBM’s Messer puts it, diversity is a key driver of innovation – “and if we’re not innovating, we’re not going to be successful.”

What does it take, then, to create a corporate environment that truly welcomes LGBTQ workers? There’s a laundry list of best practices, says Druhan, from creating formal policies, training, offering LGBTQ-relevant benefits (including drugs related to HIV/AIDS and full coverage of gender-affirming surgeries), creating and supporting LGBTQ employee resource groups, and ensuring that inclusion efforts have visible support from an organization’s most senior levels.

While each organization will have different needs or priorities, Pride at Work Canada has identified some general gaps. These include a lack of gender-neutral language in policy, a dearth of established guidelines for transition in the workplace, insufficient training for managers in particular, and a real hesitancy to measure LGBTQ populations.

This last one, Druhan says, “is strange, given that employers want to see measurable results. When you implement policies and programs that support inclusion, you want to have ways to measure their impact. One of the best ways to do that is demographic surveys that indicate numbers of LGBTQ employees and their satisfaction with the workplace. Where are LGBTQ employees? Where aren’t they – where do you need to focus your efforts?”

Employers can even measure the change over time and numbers of employees who openly identify as LGBTQ or gender-non-conforming versus those who “prefer not to say.” “An increase in those numbers signals the development of trust that this is an organization where it’s safe to be out,” says Druhan.

Interestingly, notes Messer, IBM notices an uptick in people who self-identify as LGBTQ each time the company adds benefits or create policies relevant to them.

Clients concerned with their own inclusion efforts are increasingly asking for diversity statistics as part of their selection process, says Smith. “We simply need to have that information in order to be responsive.”

Whatever strategies an organization adopts, says Druhan, they need to be part of a systemic effort rather than piecemeal initiatives. “You can design applications, for example, that use gender-neutral language or don’t ask about gender or allow applicants to use their chosen names. You can do outreach efforts to get those applications into the hands of LGBTQ community members. But if you haven’t trained hiring managers on how to operate an inclusive hiring process, how to check their own implicit biases, those earlier gains won’t have an impact.”

Here, perhaps, lies the difference between diversity and inclusiveness. “Diversity is having a lot of different people around the table,” says Druhan. “Inclusion is making sure that everyone is included in the conversation, giving people who may not have traditionally had access the tools to have access to the conversation.”

In many cases, that means starting well before even the recruitment process – not only to graduate and professional schools, but even the undergraduate and elementary levels.

“There’s no doubt that the diversity of our legal team does not yet represent the diversity of our communities,” says Smith. “There’s no denying that, period. And yet we are only able to recruit the people who come from law school. And so efforts need to start at the law school level and even before then to create an inclusive space for people who have not traditionally gravitated toward corporate law.” In that category, Smith includes gay women (significantly outnumbered by gay men), trans people, people of colour and “people from racialized minorities who are not traditionally represented in law but who are greatly represented in our communities.”

Blakes, for example, participates in a number of pipeline initiatives that target undergraduate students who haven’t thought of law school as a place for them, or LGBTQ law students who aren’t sure that they can be out and successful in a corporate setting. Rotman, says Kaplan, is deeply focused on creating formal structures to support LGBTQ students, including partnering with U.S.-based LGBTQ advocacy group Reaching Out MBA (ROMBA) and creating fellowships for standout LGBTQ spokespeople. It has also established The Letters, a fast-growing club for LGBTQ students and their allies.

In the end, she says, a truly inclusive workplace will require deep, system-wide changes, to “back up that rainbow on the office door with real action.”

Explains Kaplan: “There’s something about the business world that is still particularly toxic to anybody who’s not a straight white man. And if you hire a whole bunch of diverse people into that kind of system, you’re not ever going to really include those people. If you really want to be inclusive, you have to change the design of the system. And that’s the part that is difficult, that is costly, that requires risk. But if organizations are interested in helping their employees to be fully actualized, they need to take more than symbolic action.”

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