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Interserve to pass 3% of profits to local communities

Interserve has pledged to invest 3 per cent of its profits to local communities in what it has dubbed a “groundbreaking commitment”.

The £2 billion turnover support service and construction firm revealed the move while announcing its SustainAbilities plan, which also pledges to halve carbon emissions and recruit 500 apprentices by 2020.

Interserve group finance director and head of sustainability Tim Haywood said the plans made good business sense and would enhance the firm’s reputation with customers through a combination of financial, social, environmental and skills and knowledge measures.

He said that combination has already played a pivotal part in winning work – for example, on the £150 million West Yorkshire police PFI, where he said the bidders were on an equal footing with their commercial offer.

An Interserve-led consortium beat Balfour Beatty to win the contract to build two new police headquarters, custody suites and a training facility.

Mr Haywood said: “But we got 100 per cent for our social, environmental offer, needs of SMEs and apprenticeship roles, and putting something into the community – and that actually tipped the balance.”

He added these types of targets “will become the norm”, that contractors will need to meet them to win work and meet tender requirements and that companies risk losing work by not adapting to new sustainability and community requirements.

“Companies generally need to embrace these sorts of measures for a number of reasons. It’s going to get expensive not to, it’s going to get risky not to,” he said.

He described the 3 per cent pre-tax profit pledge by 2020 as a “groundbreaking” commitment, adding that he had only seen it elsewhere in the market at around 1 per cent, if at all.

The group revealed £182.9m of pre-tax profit in 2012.

Mr Haywood said it would not all be in the form of cash, saying the company will also contribute through areas such as community involvement.

But he added that it sends a message about big businesses.

“I find the negative reputation that business has got disappointing and a bit frustrating; certain parts of the media take delight in demonising big business and this is sort of our response to that,” he said.

Other targets include reducing voluntary employee turnover by 10 per cent.

The firm said the overall plan is aimed at putting back into society and the environment, while delivering sustainable growth and profit to shareholders.

Mr Haywood stressed that the sustainability plan “does not mean we throw away all our financial common sense and disciplines”.

But said he “does not buy” the argument that sustainability is a cost, with two pertinent topics in the UK being the soaring cost of energy and whether the UK has enough energy to meet current needs.

He said there are forward-thinking clients such as the Ministry of Defence that focus on energy efficiency in their projects, but that Interserve plans to “evangelise and lead” to tell others who have not yet “got it”.

Mr Haywood said the 50 per cent cut in carbon emissions is ahead of government targets, adding there is a debate to be had over “how green” this government is.

SustainAbilities – the 48-point plan includes:

By 2014 Interserve says it will:

  • Provide 1,000 work placements to school children every year
  • Increase re-use of construction waste by 15 per cent
  • Use only sustainable forest products
  • Introduce local employment targets when beneficial to the community

By 2016 Interserve aims to:

  • Ensure 50 per cent of forest products are certified as sustainable
  • Reduce emissions from energy use at construction sites by 30 per cent
  • Achieve a 20 per cent cut in its use of water
  • Reduce construction waste by 25 per cent
  • Reduce emissions from business travel by 30 per cent

By 2018 Interserve says it will:

  • Reduce voluntary employee turnover by 10 per cent
  • Be under way with at least 10 co-designed energy security projects
  • Double the number of apprenticeships, traineeships and graduate training opportunities
  • Develop three partnerships dedicated to innovation in sustainability
  • Achieve 75 per cent traceability of construction materials
  • Increase recycled content in materials by 50 per cent

By 2020 Interserve aims to:

  • Invest 3 per cent of pre-tax profits into local communities
  • Introduce ‘wellbeing’ key performance indicators into contracts
  • Double the opportunities for those in disadvantaged groups each year
  • Halve its absolute carbon emissions

 

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