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Ivan Lewis, Economic Secretary to the Treasury, HM Treasury

In the last edition of CEO Today, Tony Hayward of BP set out business’s view of Corporate and Social Responsibility (CSR). He argued that although CSR is something of a fashion, its core meaning of firms taking responsibility for the societies in which they operate is something more serious and long-term. Following on from Mr Hayward’s article I have been invited to offer a few thoughts from a Government perspective. Let me concentrate on a less high profile area of CSR, but one of considerable importance, that of Corporate Community Involvement (CCI).

CCI

Building enterprising communities: Deloitte encourages their employees to mentor and teach pupils at risk of exclusion, giving young people the qualifications and experience they need to secure employment, and providing employers with a source of quality recruits.

Corporate Community Involvement spans a wide range of activities including volunteering in local third sector organisations, mentoring children and financial donations. Community involvement often takes place at a local level and is key to creating strong and vibrant communities. In particular, through volunteering and mentoring, we can harness the talents and enthusiasm of young people and develop their confidence and skills to their benefit and the advantage of future employers and local communities.

Across the spectrum of corporate community involvement there’s scope for everyone in a business to get involved in activities that can have immediate and tangible local benefits. Businesses can bring a different approach which complements the work of other organisations, and they can also offer additional resources and specialist knowledge all of which means that businesses, individuals and the local community benefits.

These benefits are changing and growing as the style of CCI has evolved in response to better information about the needs of communities. A decade or so ago, firms were more likely to be involved in one-off financial donations and their employees in routine activities far removed from their fields of expertise. Today, firms want to make a continuous and therefore sustainable contribution and their workforce to draw upon specialisms such as financial and legal knowledge.

As CCI has become more beneficial and relevant to the concerns of firms and workers, more companies are starting to become involved. The charity, Business in the Community acts as a crucial source of information and motivating business and Government to do more. It has been this partnership between leading businesses like Deloitte and Merrill Lynch and third sector organisations like BitC that has driven the agenda forward.

In my view it is absolutely right that businesses, the third sector and local people are in the driving seat. However, Government also has a crucial role to play. In my capacity as Economic Secretary to the Treasury I am tasked with ensuring that Government enables and encourages public and private sector employees to identify opportunities and to pursue them. I would like to highlight three areas of policy in particular.

Russell Commission

In Budget 2004 the Chancellor and the Home Secretary invited Ian Russell to recommend the basis of a national framework for youth volunteering. Ian Russell reported a year later with an ambitious package of measures, which the Government accepted in full. This is now the center-piece in fulfilling our goal of encouraging more people to volunteer, especially young people.

Russell’s measures are now being taken forward by an independent charity, which will be launched in May, aiming at delivering a step change in the quality, quantity and diversity of volunteering. With the support of 26 companies, including our seven founding partners, the charity will work to attract one million young people to volunteer over the next five years. The success of the framework will depend on continued cross-sector partnership: this year’s Budget announced £10 million in private sector contributions. The ability to raise a further £40 million worth of private sector funding over the next two years will be key to the framework’s delivery.

Responsible Business Conference

This Government sees partnership working as key to spreading best practice and learning the lessons across a number of policy areas, including responsible business. In October 2006 the Treasury and HMRC will host a responsible business conference which will provide those present with a unique opportunity to showcase UK collaborative best practice, share ideas on how to integrate and sustain responsible activity across businesses and sectors, and produce recommendations on how to move forward together to improve our responsible business record.

Payroll giving

The Payroll Giving Quality Mark, awarded to businesses that run successful Payroll Giving Schemes

Payroll Giving lets businesses and staff work together to give money to good causes. It is a hassle-free way to make sure that charities get a regular income. Any employer can run a Payroll Giving scheme, which employees can then use to make tax-free monthly donations to charity. The Government incentivises payroll giving by refunding tax paid on the proportion of salary donated. Last year, £83 million was given to charities through Payroll Giving. This is an impressive achievement, but we are trying to build on this for next year.

To increase uptake of payroll giving, the Government funds the Institute of Fundraising, which has set up a Grant scheme to help small and medium employers (SMEs). Whilst relatively few SMEs currently run payroll giving schemes, where they do evidence suggests high levels of employee takeup. The Grant Scheme gives up to £500 to businesses to open Payroll Giving schemes, and matches donations of up to £10 a month for the first six months. In response to the scheme, over 1,300 SMEs have started Payroll Giving schemes.

Employers can also now qualify for a Quality Mark if their scheme is a success. Bronze, silver and gold awards signify a business that has signed up one, five or ten per cent of staff. Since the launch in January, over 700 employers have received an award. The Government has challenged charities, businesses and employees to work together to contribute over £100 million via payroll giving for the first time this year. One business making a considerable contribution is The Royal Bank of Scotland, who treble the value of employee donations. In January 2006, RBS Group was one of the first to be awarded with a gold Quality Mark. More information on this area can be found at www.payrollgivingcentre.org.uk.

Exciting Times Ahead

There are a number of ways then in which the Government has helped and is helping to foster Corporate and Community Involvement as part of the wider programme of Corporate and Social Responsibility. However, I know from having worked in the third sector that success depends upon a partnership between all sectors of society. If we can continue to renew and refresh this partnership, there will be exciting times ahead in the field of responsible business.

Biography

Ivan Lewis was appointed as Economic Secretary to the Treasury in May 2005, having been Parliamentary Under Secretary of State for Skills and Vocational Education at the Department for Education and Skills since June 2003. Before that he was Parliamentary Under Secretary of State for Young People and Learning, Parliamentary Under Secretary of State for Adult Learning and Skills and then Parliamentary Under Secretary of State for Young People and Adult Skills at the DfES. Mr Lewis has been Member of Parliament for Bury South, Manchaster, since 1997. The Payroll Giving Quality Mark, awarded to businesses that run successful Payroll Giving Schemes

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