The erosion of public trust in big business has changed the landscape for finance leaders, according to Gregor Alexander, Finance Director for British energy company SSE.
“Once there used to be a trade-off between making money in the short term or being a long-term force for good,” he said. “But now public expectations have rightly changed, and those companies which fail to contribute to society risk their business and their right to make a profit.”
No more has that erosion of public trust been evident than in the energy industry, which has rarely been out of the political and media spotlight of late. Earning back that trust, and by extension earning the right to be profitable, is at the heart of what is characterised as the ‘CFO’s dilemma.’
SSE has been taking strides towards balancing its profit with its social conscience. SSE became a Living Wage employer in September 2013. It was the biggest company at the time to achieve accreditation and is the only energy company to guarantee all its employees a Living Wage. In October 2014, SSE also became the first FTSE 100 Company to be Fair Tax Accredited.
“The CFO’s dilemma, in my mind, is not so much a binary choice: between the soft things that support society as opposed to the hard things like shareholder return. The dilemma is the choice of the actions you take to ensure you can achieve both. Then evidencing it to show clearly to shareholders and stakeholders what you are doing,” said Mr. Alexander,
“The CFO must be at the centre of this change, just as corporate social responsibility (CSR) must be at the heart of a good business too,” he added.