Raconteur https://www.raconteur.net Publisher of special-interest content to the world’s leading media brands Fri, 26 Aug 2022 14:32:55 +0000 en-GB hourly 1 https://wordpress.org/?v=6.0.1 Are we at the dawn of the AI-created city? https://www.raconteur.net/urbanisation/are-we-at-the-dawn-of-the-ai-created-city/ Fri, 26 Aug 2022 14:32:20 +0000 //www.raconteur.net/?p=157945 Illustration of an AI-designed urban area

A new wave of generative design tools poses existential questions for urban planners and architects about the future of our public spaces


Just over a century since The Manifesto of Futurist Architecture declared the city must be rethought and rebuilt like an “immense and tumultuous shipyard” – “everywhere dynamic”, and the house like a “gigantic machine”, it may be that author Antonio Sant’Elia had things the wrong way around. 

Because although his machine-fetishising sketches inspired our common vision of a science-fiction future – as in Fritz Lang’s 1927 film Metropolis, with its technological Tower of Babel an imposing centrepiece – it might be the gigantic machines that are making our houses.

Architecture and AI visionaries – forming especially around MIT in the 1950s, through to the later work of MIT Media Lab co-founder Nicholas Negroponte – and design pioneers have long thought about automating the creation of our environments. Now the technology is catching up to their ideas, and a radical shift into AI-assisted design is taking hold, with implications that could radically transform the form, feel and function of the places we inhabit.

Completely automated design is not quite there yet. This crop of generative, AI-assisted tools is rather new. But there are signs that we could be on the cusp of a revolution in how our buildings, towns and cities are created. Will these begin to take on a homogeneous shape, recognisable as AI-planned spaces? And is this the beginning of the ‘copy-and-pasted’ city – or do we already inhabit those, with the identical new-build properties that seem to crop up everywhere? 

AI helping hand 

Advocates argue that AI-based city design could remove burdensome manual labour, allowing architects, designers and planners to focus on creativity. On the other hand, could AI accelerate more of the same – a ruthlessly efficient approach to stuffing more people into buildings and maximising rents. Whatever happens, AI-assisted design appears set to radically change the future of architecture.

Despite the long tail of thinking around automated design, the drafting process was largely manual until very recently, even in software like the ubiquitous AutoCAD or the building information modelling tools that added more context to designs and have become dominant. “There was always the dream of automating design and urban planning but, little by little, it happened over the last decade or so,” comments Imdat As, architect and co-editor of The Routledge Companion to Artificial Intelligence in Architecture.

The machine learning revolution has helped create the conditions for adequate computing power, with the imitation-thinking enabled by neural networks finally making generative design commercially viable. Nudging this AI-assisted world into reality are new tools backed by Silicon Valley, such as Delve, owned by Google subsidiary Sidewalk Labs, and SpaceMaker, which was recently acquired by computer-aided design giant Autodesk for $240m (£196m).

There was always the dream of automating design and urban planning

Unlike the painstakingly crafted line-by-line processes normally associated with architecture proposals, these tools allow the user to view and play with a huge range of variables – prioritising or adjusting nuances we may take for granted, like noise levels, temperature or window views – and then generating design options. With the traditional approach, planning teams are limited by their time and their tools, so proposals rarely exceed a selection of three to five designs. But by using AI-assisted tools, planners can explore hundreds, if not thousands of options, with their subtle differences illustrated on a 3D map so various stakeholders can view progress or collaborate as plans evolve. 

A huge shift in architectural planning

SpaceMaker co-founder and CEO Håvard Haukeland says that this is one of his platform’s key benefits: because urban planning is very much about competing interests, projects can end up bogged down by meetings where people are spending more time putting forward their cases, rather than exploring multiple solutions. The latter, he argues, is “better for the city, better for the people living in the apartments or using the office spaces, and it’s usually better for the economics of the project and the developer”.

Haukeland adds that this approach could represent a huge shift in architecture and planning – and one that can virtually eliminate what those in the industry colourfully term ‘Oh Shit Moments’: when a design has already been fixed, but the team had forgotten to carry out essential tasks like noise analysis, thereby potentially setting project deadlines back – sometimes quite literally to the drawing board.

That was a fate avoided by the growing Kivistö district in Vantaa, Finland, where a new railway line will see its population swell to 45,000 in the coming decades (a relatively large population in Finnish terms). 

For planners, it was crucial to balance new, dense urban neighbourhoods within it with the district’s proximity to nature and its silver birch-lined streets, while also remaining on course for a 2050 carbon neutral target. Even at a late stage, designers were able to use SpaceMaker to refine plans for interior courtyards, reducing wind effects and placing a sunny terrace for future residents. “The software almost downright persuades one to try different options,” commented town planner Ville Leppänen.

Meanwhile, in Sofia, Bulgaria, city planners applied Delve to a city unit to map out future development strategies for the area. They told RIBAJ that the test project provided “valuable and important insight into the many possibilities that parametric planning offers”, with one of the key benefits being able to “rapidly change input data and generate output results that may not have been even considered before”.

This kind of experimentation was just not possible at this pace or scale previously. Michele Pelino is principal analyst, edge computing and the internet of things, at Forrester Research. She notes that although future-looking cities like Singapore had experimented with digital twin technology – where virtual copies are made of existing places and are then subject to computer simulations – applied generative design is new terrain and how it will shape our buildings and cities is yet to be determined. 

Model renaissance

With the right prompts and some patience, algorithms appear capable of helping to create stunning portraits and fantastical worlds, as evidenced by OpenAI’s Dalle2 system: an easily navigable fountain of artistry that anybody can use. This AI-generated art is a window into what will become possible on a larger scale with our buildings, especially when combined with 3D printing, coming together to encompass one automated process. So says Eleanor Watson, IEEE AI Ethics engineer and AI Faculty at Singularity University. 

This could, she says, build works of incredible complexity but at no extra marginal cost – and would be an opportunity to push back against the “stark utilitarian mass-produced simplicity, inoffensive and timeless yet dull and soulless”. “We might soon see a renaissance, whereby plainness becomes passé, in a world where beauty has become next to free,” she says.

First, though, there are many more complexities to creating a building (and even more on the scale of towns and cities) than generating a pleasing portrait image. With all their variables, location-specific considerations, the context-dependent nature of floorplans, and the algorithmically impossible-to-pin-down overall feeling of a place, it may be some time yet before machines are helping to bring about that renaissance.

For now, it is the nuts-and-bolts stuff where the latest AI-generative tools excel; the design is not quite end-to-end – meaning, pushing a button won’t instantly generate you a building or district to your liking. 

You want to encourage positive mutations and that’s what AI and machine learning make possible

But even these optimisations have the potential to change the look and feel of spaces, adds Pelino. 

Being able to analyse, calculate and map predicted temperatures, for instance, could help developers avoid creating urban heat islands, and create cooler conditions for residents as buildings and cities evolve. And as sustainability becomes a more pressing concern, it may be proven that our approaches to buildings and cities are woefully inadequate – and that AI-imagined geometric models surprise designers with the optimised shapes they take. 

In time, as technology marches forward, new, surprising, aesthetic forms may crystallise. 

Stephen Barrett, partner at Rogers Stirk Harbour + Partners, believes that AI will be able to take the more mechanistic day-to-day activities of planners and designers, and “autocomplete” some of the laborious processes. There are “great advantages” to this, he says: it frees up time and space to work on the interesting stuff, to innovate and create. 

At present, for instance, an AI-generated Picasso scene will create a rough caricature of the artist’s style based on the inputs fed to it. But however impressive it might be, it is no more than an approximation – a kind of evolved copy – of existing images and aesthetics rather than something altogether new. 

So, determining the future with algorithms needs to be considered “very carefully”, he says: “It’s a little bit like Modernist architecture in the mid-to-late 20th century. It was meant to be a form of architecture free of baggage and values but, in the end, you could argue it was fairly post-colonial dominant – and you have the same buildings in São Paulo as you have in Riyadh as you have in Singapore or Moscow or wherever.

“You want to encourage positive mutations and that’s what the rapid processing and multiple iterations of AI and machine learning make possible,” he adds. “But also, to ensure that the output is intelligent, and not simply a reflection of the limitations of the inputs.”

So designers will have to tread carefully and remain conscious of algorithmic bias, where software reproduces errors due to the prejudices of the software designers. 

Flair over form for the foreseeable

Haukeland argues that more design options and therefore more variety can hardly ever be a bad thing. But if you look at history, he adds, revolutions in architecture have occurred across thousands of years and in the end, there’s always something new, better, or smarter that builds on the past. “It’s easy to stand here at the beginning of a new era and say this will change everything,” he says. “But in 10, 20 or 30 years’ time, we might say that generative design and AI was super interesting but it had its weaknesses. So I don’t think humans have come to the end.”

Imdat As wonders what designers would work on if AI were to produce 90% of the buildings. 

“The top 10 designers – the Zaha Hadids, and so on – will always be there, with new ideas, new aesthetics. Those will be the designers who come up with a new design idea,” he says. “And what if they trained in-house AI systems? Instead of, say, 10 buildings a year, they might build a million, all over the world. The power of AI for an architectural company could be amazing. The business structure could be: if you use my AI system, you pay royalties. It could change architectural practice models. I think there will be those types of changes.”

While machines are learning to navigate environments, they can never know the experience of doing so

Presently, it’s unlikely that residents would notice at all if computers helped to build their housing, angling a complex five or six degrees to maximise liveability. And it may be too early to tell if algorithmically designed buildings and cities will leave telltale AI marks in their floorplans or on their façades, but As is hopeful that “its own sort of urban morphology” will emerge.

Barrett wonders if the “step-change revolutions you get with accidental, erratic, unique or eccentric human inputs” could ever occur with artificial intelligence thrown into the mix. “If you took a city like Paris and ran that as an existing data set, you’d have more Paris,” he comments, “which is not a bad thing. But would you ever have had a Pompidou Centre?”

One thing does, though, seem certain. Given the efficiency gains, AI-assisted design will play an increasingly important role in that future planning, developing, building. But just as with software and the complex data sets that inform or mediate our lives, keeping a human in the loop is likely to be a fixture in the foreseeable, “marshalling, judging, and continuing to select”, says Barrett. 

“After all, while machines are learning to navigate environments, they can never know the experience of doing so,” adds Watson. “We must never sacrifice the feel of an urban landscape at the altar of efficiency, nor cause a malfunction in any person’s enjoyment of a resource.” 



The post Are we at the dawn of the AI-created city? appeared first on Raconteur.

]]>
Illustration of an AI-designed urban area

A new wave of generative design tools poses existential questions for urban planners and architects about the future of our public spaces


Just over a century since The Manifesto of Futurist Architecture declared the city must be rethought and rebuilt like an “immense and tumultuous shipyard” – “everywhere dynamic”, and the house like a “gigantic machine”, it may be that author Antonio Sant’Elia had things the wrong way around. 

Because although his machine-fetishising sketches inspired our common vision of a science-fiction future – as in Fritz Lang’s 1927 film Metropolis, with its technological Tower of Babel an imposing centrepiece – it might be the gigantic machines that are making our houses.

Architecture and AI visionaries – forming especially around MIT in the 1950s, through to the later work of MIT Media Lab co-founder Nicholas Negroponte – and design pioneers have long thought about automating the creation of our environments. Now the technology is catching up to their ideas, and a radical shift into AI-assisted design is taking hold, with implications that could radically transform the form, feel and function of the places we inhabit.

Completely automated design is not quite there yet. This crop of generative, AI-assisted tools is rather new. But there are signs that we could be on the cusp of a revolution in how our buildings, towns and cities are created. Will these begin to take on a homogeneous shape, recognisable as AI-planned spaces? And is this the beginning of the ‘copy-and-pasted’ city – or do we already inhabit those, with the identical new-build properties that seem to crop up everywhere? 

AI helping hand 

Advocates argue that AI-based city design could remove burdensome manual labour, allowing architects, designers and planners to focus on creativity. On the other hand, could AI accelerate more of the same – a ruthlessly efficient approach to stuffing more people into buildings and maximising rents. Whatever happens, AI-assisted design appears set to radically change the future of architecture.

Despite the long tail of thinking around automated design, the drafting process was largely manual until very recently, even in software like the ubiquitous AutoCAD or the building information modelling tools that added more context to designs and have become dominant. “There was always the dream of automating design and urban planning but, little by little, it happened over the last decade or so,” comments Imdat As, architect and co-editor of The Routledge Companion to Artificial Intelligence in Architecture.

The machine learning revolution has helped create the conditions for adequate computing power, with the imitation-thinking enabled by neural networks finally making generative design commercially viable. Nudging this AI-assisted world into reality are new tools backed by Silicon Valley, such as Delve, owned by Google subsidiary Sidewalk Labs, and SpaceMaker, which was recently acquired by computer-aided design giant Autodesk for $240m (£196m).

There was always the dream of automating design and urban planning

Unlike the painstakingly crafted line-by-line processes normally associated with architecture proposals, these tools allow the user to view and play with a huge range of variables – prioritising or adjusting nuances we may take for granted, like noise levels, temperature or window views – and then generating design options. With the traditional approach, planning teams are limited by their time and their tools, so proposals rarely exceed a selection of three to five designs. But by using AI-assisted tools, planners can explore hundreds, if not thousands of options, with their subtle differences illustrated on a 3D map so various stakeholders can view progress or collaborate as plans evolve. 

A huge shift in architectural planning

SpaceMaker co-founder and CEO Håvard Haukeland says that this is one of his platform’s key benefits: because urban planning is very much about competing interests, projects can end up bogged down by meetings where people are spending more time putting forward their cases, rather than exploring multiple solutions. The latter, he argues, is “better for the city, better for the people living in the apartments or using the office spaces, and it’s usually better for the economics of the project and the developer”.

Haukeland adds that this approach could represent a huge shift in architecture and planning – and one that can virtually eliminate what those in the industry colourfully term ‘Oh Shit Moments’: when a design has already been fixed, but the team had forgotten to carry out essential tasks like noise analysis, thereby potentially setting project deadlines back – sometimes quite literally to the drawing board.

That was a fate avoided by the growing Kivistö district in Vantaa, Finland, where a new railway line will see its population swell to 45,000 in the coming decades (a relatively large population in Finnish terms). 

For planners, it was crucial to balance new, dense urban neighbourhoods within it with the district’s proximity to nature and its silver birch-lined streets, while also remaining on course for a 2050 carbon neutral target. Even at a late stage, designers were able to use SpaceMaker to refine plans for interior courtyards, reducing wind effects and placing a sunny terrace for future residents. “The software almost downright persuades one to try different options,” commented town planner Ville Leppänen.

Meanwhile, in Sofia, Bulgaria, city planners applied Delve to a city unit to map out future development strategies for the area. They told RIBAJ that the test project provided “valuable and important insight into the many possibilities that parametric planning offers”, with one of the key benefits being able to “rapidly change input data and generate output results that may not have been even considered before”.

This kind of experimentation was just not possible at this pace or scale previously. Michele Pelino is principal analyst, edge computing and the internet of things, at Forrester Research. She notes that although future-looking cities like Singapore had experimented with digital twin technology – where virtual copies are made of existing places and are then subject to computer simulations – applied generative design is new terrain and how it will shape our buildings and cities is yet to be determined. 

Model renaissance

With the right prompts and some patience, algorithms appear capable of helping to create stunning portraits and fantastical worlds, as evidenced by OpenAI’s Dalle2 system: an easily navigable fountain of artistry that anybody can use. This AI-generated art is a window into what will become possible on a larger scale with our buildings, especially when combined with 3D printing, coming together to encompass one automated process. So says Eleanor Watson, IEEE AI Ethics engineer and AI Faculty at Singularity University. 

This could, she says, build works of incredible complexity but at no extra marginal cost – and would be an opportunity to push back against the “stark utilitarian mass-produced simplicity, inoffensive and timeless yet dull and soulless”. “We might soon see a renaissance, whereby plainness becomes passé, in a world where beauty has become next to free,” she says.

First, though, there are many more complexities to creating a building (and even more on the scale of towns and cities) than generating a pleasing portrait image. With all their variables, location-specific considerations, the context-dependent nature of floorplans, and the algorithmically impossible-to-pin-down overall feeling of a place, it may be some time yet before machines are helping to bring about that renaissance.

For now, it is the nuts-and-bolts stuff where the latest AI-generative tools excel; the design is not quite end-to-end – meaning, pushing a button won’t instantly generate you a building or district to your liking. 

You want to encourage positive mutations and that’s what AI and machine learning make possible

But even these optimisations have the potential to change the look and feel of spaces, adds Pelino. 

Being able to analyse, calculate and map predicted temperatures, for instance, could help developers avoid creating urban heat islands, and create cooler conditions for residents as buildings and cities evolve. And as sustainability becomes a more pressing concern, it may be proven that our approaches to buildings and cities are woefully inadequate – and that AI-imagined geometric models surprise designers with the optimised shapes they take. 

In time, as technology marches forward, new, surprising, aesthetic forms may crystallise. 

Stephen Barrett, partner at Rogers Stirk Harbour + Partners, believes that AI will be able to take the more mechanistic day-to-day activities of planners and designers, and “autocomplete” some of the laborious processes. There are “great advantages” to this, he says: it frees up time and space to work on the interesting stuff, to innovate and create. 

At present, for instance, an AI-generated Picasso scene will create a rough caricature of the artist’s style based on the inputs fed to it. But however impressive it might be, it is no more than an approximation – a kind of evolved copy – of existing images and aesthetics rather than something altogether new. 

So, determining the future with algorithms needs to be considered “very carefully”, he says: “It’s a little bit like Modernist architecture in the mid-to-late 20th century. It was meant to be a form of architecture free of baggage and values but, in the end, you could argue it was fairly post-colonial dominant – and you have the same buildings in São Paulo as you have in Riyadh as you have in Singapore or Moscow or wherever.

“You want to encourage positive mutations and that’s what the rapid processing and multiple iterations of AI and machine learning make possible,” he adds. “But also, to ensure that the output is intelligent, and not simply a reflection of the limitations of the inputs.”

So designers will have to tread carefully and remain conscious of algorithmic bias, where software reproduces errors due to the prejudices of the software designers. 

Flair over form for the foreseeable

Haukeland argues that more design options and therefore more variety can hardly ever be a bad thing. But if you look at history, he adds, revolutions in architecture have occurred across thousands of years and in the end, there’s always something new, better, or smarter that builds on the past. “It’s easy to stand here at the beginning of a new era and say this will change everything,” he says. “But in 10, 20 or 30 years’ time, we might say that generative design and AI was super interesting but it had its weaknesses. So I don’t think humans have come to the end.”

Imdat As wonders what designers would work on if AI were to produce 90% of the buildings. 

“The top 10 designers – the Zaha Hadids, and so on – will always be there, with new ideas, new aesthetics. Those will be the designers who come up with a new design idea,” he says. “And what if they trained in-house AI systems? Instead of, say, 10 buildings a year, they might build a million, all over the world. The power of AI for an architectural company could be amazing. The business structure could be: if you use my AI system, you pay royalties. It could change architectural practice models. I think there will be those types of changes.”

While machines are learning to navigate environments, they can never know the experience of doing so

Presently, it’s unlikely that residents would notice at all if computers helped to build their housing, angling a complex five or six degrees to maximise liveability. And it may be too early to tell if algorithmically designed buildings and cities will leave telltale AI marks in their floorplans or on their façades, but As is hopeful that “its own sort of urban morphology” will emerge.

Barrett wonders if the “step-change revolutions you get with accidental, erratic, unique or eccentric human inputs” could ever occur with artificial intelligence thrown into the mix. “If you took a city like Paris and ran that as an existing data set, you’d have more Paris,” he comments, “which is not a bad thing. But would you ever have had a Pompidou Centre?”

One thing does, though, seem certain. Given the efficiency gains, AI-assisted design will play an increasingly important role in that future planning, developing, building. But just as with software and the complex data sets that inform or mediate our lives, keeping a human in the loop is likely to be a fixture in the foreseeable, “marshalling, judging, and continuing to select”, says Barrett. 

“After all, while machines are learning to navigate environments, they can never know the experience of doing so,” adds Watson. “We must never sacrifice the feel of an urban landscape at the altar of efficiency, nor cause a malfunction in any person’s enjoyment of a resource.” 



The post Are we at the dawn of the AI-created city? appeared first on Raconteur.

]]>
The hybrid holiday: a quest for work/leave balance https://www.raconteur.net/workplace/the-hybrid-holiday-a-quest-for-work-leave-balance/ Fri, 26 Aug 2022 14:02:28 +0000 //www.raconteur.net/?p=157940 Employee works from hammock in sunny beachside location

The work-from-anywhere perk is evolving apace. So-called workcations are set to become increasingly popular, but how can employers ensure that these alleviate, rather than fuel, burnout?


Photos of laptops perched on beaches and mountainsides are popping up all over people’s LinkedIn feeds, illustrating how working from anywhere (WFA) is fast becoming a signature benefit of the new world of employment. 

The number of adverts for jobs offering remote work on LinkedIn and Indeed in the UK increased by 329% between January 2020 and March 2022, while the number of related searches leapt by 790% over the same period. 

In the first quarter of 2022, remote tax consultancy The Work From Anywhere Team published a survey of firms employing more than 2.7 million people around the world. It found that 54% of respondents allowed WFA and a similar percentage believed that this facility would become a core employee benefit in their industries within a decade. Half of those operating such a policy allowed staff to work from anywhere for more than 60 days a year.

Adapting to the digital-nomad lifestyle

Ecosia is a Berlin-based green search engine that allows its employees to work from anywhere for up to six months each year, although it encourages people to avoid flying wherever possible. Meanwhile, Pleo, a Copenhagen-based fintech unicorn specialising in expenses management, lets its staff work from anywhere indefinitely. Its flexible benefits programme even enables employees to buy an extra 10 days of annual leave.

Ecosia’s chief marketing officer is Hannah Wickes, an Australian who’s planning to work in Scotland and Portugal for the next two months. She sees the allowance as a way of rewarding people who may have been barred by Covid travel restrictions from visiting relatives and friends overseas for the best part of two years.

“This approach means that employees often want to combine their annual leave with a workcation and make the most of their travel time,” she says. “It’s not uncommon for team members to spend up to two months a year taking advantage of our flexible policy.”

Pleo’s “people person”, Jessie Danyi, is “living and working around the world, one continent at a time”. Having spent from April to July this year in Morocco, the South African is currently visiting relatives in Hungary. Her plan is to return to Africa after a month and spend six weeks on the coast of Kenya. 

It’s not uncommon for team members to spend up to two months a year taking advantage of our flexible policy

Although the carefully curated LinkedIn posts glamorise the digital-nomad lifestyle, anyone seeking a workcation will need to consider the more mundane realities of WFA. For instance, employees at Ecosia must first run their travel plans past their colleagues, particularly if they’re going to be in different time zones. 

Numerous practical challenges might deter would-be travellers. Danyi acknowledges that it can take a lot of effort to sort out visas, travel arrangements and suitably equipped accommodation. Finding a decent Wi-Fi connection takes priority over admiring the scenery, for instance. What’s more, you are actually working – meaning that you’re unlikely to get as much time to explore as you might have hoped. Not having a base or a local friendship network can also be exhausting, she admits.

“Travelling with work brings trade-offs on how adventurous you can be,” Danyi says. “If you’re working full time, that leaves mornings, evenings and weekends, of course. Sometimes, if you've had a busy week, you just want to watch Netflix and catch up on your sleep. Or maybe you need to drive to the nearest city to buy an ethernet cable because your Zoom calls are lagging, so you end up using your weekend for admin.”

While she was in Morocco, Danyi was able to gain a deeper appreciation of the country’s culture, while also finding enough time for some surfing. Overall, she believes that the rewards of her experience there outweighed any downsides.

Striking the right balance

Workcations might also be the only method by which self-employed people, especially entrepreneurs starting a new business, can get away. Rachel Allison, who founded communications agency Axe & Saw in London in March 2021, recently spent a fortnight working from an Airbnb in Porto, where she enjoyed the local cuisine and also went surfing. 

Allison admits that it was tricky to get the balance right initially. But, once she managed to “nail it”, she reaped the benefits.

“In the first week, I was putting in my normal hours – on Zoom calls all morning, during lunchtime and even at 5pm. That left me feeling frustrated and frazzled,” Allison admits. “But I was keen to make things work. I became aware that usually there’s not so much going on from Monday to Wednesday, so those were the times to get my head down. Once I’d cracked that, my productivity rocketed.”

Is a workcation an adequate replacement for annual leave? Not for Allison, who says that her time in Portugal “allowed me a rest during an extremely busy period for my business, which is still new. But a proper holiday would undoubtedly still be the most effective way to recharge.”

Danyi believes that firms embracing WFA will see more of their employees adopting a partial digital-nomad lifestyle that follows the seasons. Brazilian entrepreneur Marcos Carvalho agrees, predicting that more people will become autonomous workers in decentralised companies, giving themselves more time to pursue their passions.

If travel is one of these and you also have young children, how to care for them properly while you’re working abroad adds to the list of challenges. Carvalho co-founded Boundless Life in September 2021 to address that very issue. His business offers accommodation, childcare/education and co-working spaces in countries including Portugal, Greece and Italy.

Exhibiting self-discipline in your work, downtime and wellbeing matters even more in this context 

While Boundless Life does attract corporate nine-to-fivers, it’s built a significant following among self-employed people and entrepreneurs who share Allison’s discomfort about leaving their nascent businesses unattended for long.

“Being with us helps them to feel they’re in the right place to achieve a better balance with their families, while giving them more creativity to direct towards their work,” Carvalho says. “That’s why entrepreneurs are attracted to this lifestyle.”

While he is comfortable with the fact that his own lifestyle regularly blurs work and leisure travel, Wickes, Danyi and Allison are all conscious that a workcation could do the opposite of its intended purpose and actually increase the risk of burnout.

It’s therefore crucial to establish strict work/life boundaries while taking one, according to Rowena Hennigan, an Irish national who runs her training and coaching business, RoRemote, from Zaragoza in north-east Spain. 

“Exhibiting self-discipline in your work, downtime and wellbeing matters even more in this context,” she stresses. “To avoid the fear of missing out, you need to know when you’re working and when you’re actually experiencing the location you’ve travelled to.”

Hennigan believes that unrealistic expectations and blurred boundaries will inevitably cause tension, making the experience unbalanced and, ultimately, counterproductive. Being clear about when you’re an employee and when you’re a traveller, she recommends, is the key to getting the maximum mileage from a workcation.



The post The hybrid holiday: a quest for work/leave balance appeared first on Raconteur.

]]>
Employee works from hammock in sunny beachside location

The work-from-anywhere perk is evolving apace. So-called workcations are set to become increasingly popular, but how can employers ensure that these alleviate, rather than fuel, burnout?


Photos of laptops perched on beaches and mountainsides are popping up all over people’s LinkedIn feeds, illustrating how working from anywhere (WFA) is fast becoming a signature benefit of the new world of employment. 

The number of adverts for jobs offering remote work on LinkedIn and Indeed in the UK increased by 329% between January 2020 and March 2022, while the number of related searches leapt by 790% over the same period. 

In the first quarter of 2022, remote tax consultancy The Work From Anywhere Team published a survey of firms employing more than 2.7 million people around the world. It found that 54% of respondents allowed WFA and a similar percentage believed that this facility would become a core employee benefit in their industries within a decade. Half of those operating such a policy allowed staff to work from anywhere for more than 60 days a year.

Adapting to the digital-nomad lifestyle

Ecosia is a Berlin-based green search engine that allows its employees to work from anywhere for up to six months each year, although it encourages people to avoid flying wherever possible. Meanwhile, Pleo, a Copenhagen-based fintech unicorn specialising in expenses management, lets its staff work from anywhere indefinitely. Its flexible benefits programme even enables employees to buy an extra 10 days of annual leave.

Ecosia’s chief marketing officer is Hannah Wickes, an Australian who’s planning to work in Scotland and Portugal for the next two months. She sees the allowance as a way of rewarding people who may have been barred by Covid travel restrictions from visiting relatives and friends overseas for the best part of two years.

“This approach means that employees often want to combine their annual leave with a workcation and make the most of their travel time,” she says. “It’s not uncommon for team members to spend up to two months a year taking advantage of our flexible policy.”

Pleo’s “people person”, Jessie Danyi, is “living and working around the world, one continent at a time”. Having spent from April to July this year in Morocco, the South African is currently visiting relatives in Hungary. Her plan is to return to Africa after a month and spend six weeks on the coast of Kenya. 

It’s not uncommon for team members to spend up to two months a year taking advantage of our flexible policy

Although the carefully curated LinkedIn posts glamorise the digital-nomad lifestyle, anyone seeking a workcation will need to consider the more mundane realities of WFA. For instance, employees at Ecosia must first run their travel plans past their colleagues, particularly if they’re going to be in different time zones. 

Numerous practical challenges might deter would-be travellers. Danyi acknowledges that it can take a lot of effort to sort out visas, travel arrangements and suitably equipped accommodation. Finding a decent Wi-Fi connection takes priority over admiring the scenery, for instance. What’s more, you are actually working – meaning that you’re unlikely to get as much time to explore as you might have hoped. Not having a base or a local friendship network can also be exhausting, she admits.

“Travelling with work brings trade-offs on how adventurous you can be,” Danyi says. “If you’re working full time, that leaves mornings, evenings and weekends, of course. Sometimes, if you've had a busy week, you just want to watch Netflix and catch up on your sleep. Or maybe you need to drive to the nearest city to buy an ethernet cable because your Zoom calls are lagging, so you end up using your weekend for admin.”

While she was in Morocco, Danyi was able to gain a deeper appreciation of the country’s culture, while also finding enough time for some surfing. Overall, she believes that the rewards of her experience there outweighed any downsides.

Striking the right balance

Workcations might also be the only method by which self-employed people, especially entrepreneurs starting a new business, can get away. Rachel Allison, who founded communications agency Axe & Saw in London in March 2021, recently spent a fortnight working from an Airbnb in Porto, where she enjoyed the local cuisine and also went surfing. 

Allison admits that it was tricky to get the balance right initially. But, once she managed to “nail it”, she reaped the benefits.

“In the first week, I was putting in my normal hours – on Zoom calls all morning, during lunchtime and even at 5pm. That left me feeling frustrated and frazzled,” Allison admits. “But I was keen to make things work. I became aware that usually there’s not so much going on from Monday to Wednesday, so those were the times to get my head down. Once I’d cracked that, my productivity rocketed.”

Is a workcation an adequate replacement for annual leave? Not for Allison, who says that her time in Portugal “allowed me a rest during an extremely busy period for my business, which is still new. But a proper holiday would undoubtedly still be the most effective way to recharge.”

Danyi believes that firms embracing WFA will see more of their employees adopting a partial digital-nomad lifestyle that follows the seasons. Brazilian entrepreneur Marcos Carvalho agrees, predicting that more people will become autonomous workers in decentralised companies, giving themselves more time to pursue their passions.

If travel is one of these and you also have young children, how to care for them properly while you’re working abroad adds to the list of challenges. Carvalho co-founded Boundless Life in September 2021 to address that very issue. His business offers accommodation, childcare/education and co-working spaces in countries including Portugal, Greece and Italy.

Exhibiting self-discipline in your work, downtime and wellbeing matters even more in this context 

While Boundless Life does attract corporate nine-to-fivers, it’s built a significant following among self-employed people and entrepreneurs who share Allison’s discomfort about leaving their nascent businesses unattended for long.

“Being with us helps them to feel they’re in the right place to achieve a better balance with their families, while giving them more creativity to direct towards their work,” Carvalho says. “That’s why entrepreneurs are attracted to this lifestyle.”

While he is comfortable with the fact that his own lifestyle regularly blurs work and leisure travel, Wickes, Danyi and Allison are all conscious that a workcation could do the opposite of its intended purpose and actually increase the risk of burnout.

It’s therefore crucial to establish strict work/life boundaries while taking one, according to Rowena Hennigan, an Irish national who runs her training and coaching business, RoRemote, from Zaragoza in north-east Spain. 

“Exhibiting self-discipline in your work, downtime and wellbeing matters even more in this context,” she stresses. “To avoid the fear of missing out, you need to know when you’re working and when you’re actually experiencing the location you’ve travelled to.”

Hennigan believes that unrealistic expectations and blurred boundaries will inevitably cause tension, making the experience unbalanced and, ultimately, counterproductive. Being clear about when you’re an employee and when you’re a traveller, she recommends, is the key to getting the maximum mileage from a workcation.



The post The hybrid holiday: a quest for work/leave balance appeared first on Raconteur.

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All in this together? Why it’s time for business leaders to read the room on executive pay https://www.raconteur.net/c-suite/all-in-this-together-why-its-time-for-business-leaders-to-read-the-room-on-executive-pay/ Thu, 25 Aug 2022 16:10:44 +0000 //www.raconteur.net/?p=157913 CEO pockets a handful of notes

New research reveals that the median pay of CEOs in the FTSE 100 rose by 39% between 2020 and 2021, putting the spotlight on boardroom rewards once more  


As the cost-of-living-crisis forces millions of people in the UK to cut their spending drastically to make ends meet, a study by the High Pay Centre and the Trades Union Congress (TUC) has found that the median FTSE-100 chief executive took home £3.41m in 2021, compared with £2.46m the year before. That equates to an annual pay rise of 39%. 

Meanwhile, the average British worker has received a real-terms cut of 3%, according to the Office for National Statistics (ONS), as pay awards fail to match soaring inflation. Darren Morgan, director of economic statistics at the ONS, has described this as the fastest fall in the real value of pay in this country since comparable records began. 

Unsurprisingly, the pay gap between blue-chip bosses and the average employee widened significantly in 2021. The median CEO reward package in the FTSE 100 last year was 109 times larger than the median earnings of a full-time worker (£31,285), compared with a mere 79 times in 2020. The highest-paid chief executive in the FTSE 100, Endeavour Mining’s Sébastien de Montessus, received £16.85m.  

A potential tipping point 

The research has prompted the usual calls for the pay of business leaders to be capped or in some way linked to the earnings of the lowest-paid workers in their companies. They may well think that they can weather this storm of protest again, just as they always have, but things feel different this year. 

Much of the industrial action that thousands of workers have taken to improve their pay looks set to extend beyond the ‘summer of discontent’, so named by commentators likening the situation to the winter of discontent – a wave of strikes that brought down the Labour government during a period of high inflation in 1979.  

Railway workers have been picketing in pursuit of a sub-inflation pay rise of 7%. Network Rail’s chief executive, Andrew Haines, recently saw his salary increase by 8.5%, from £544,000 to £590,000. He earns about 20 times more than the average train guard. 

Journalists at Reach, which owns the Daily Mirror and Daily Star, are set to walk out in response to a proposed pay deal they claim is equivalent to a 7% cut in real terms. Meanwhile, the pay of its CEO, Jim Mullen, has risen by 700% (thanks partly to a long-term incentive plan, which won’t mature until 2024). Wildcat strikes are also on the rise as dissatisfaction spreads through the nation’s workplaces. 

The idea that bosses can deny their workers the pay rises they’re requesting amid the cost-of-living crisis while increasing their own to such an extent feels out of step with the mood of the nation. Widespread concern about inflation – particularly soaring energy prices – is shaking consumer confidence. When this falters, so does the economy. 

In touch with reality 

What, then, are the solutions? Proposals from the High Pay Centre and research organisation Autonomy to cap CEOs’ salaries at £200,000 seem unworkable. Such a move would prevent British businesses from competing for the best executive talent, harming them and the economy in the long run.  

But business leaders do need to show that they are listening. That is what PwC’s partners have done. The auditing giant’s leaders have pledged to take a pay cut to fund inflation-beating increases for lower-paid staff.  

Such sacrifices can pay off for the business in the long run. Rewarding employees and supporting them through tough economic times should make them less inclined to seek more lucrative work with a competitor, for instance. The cost of high staff turnover to a business, especially in the UK’s tight labour market, could end up exceeding that of granting a decent pay rise across the board. 

The argument that the money isn’t available for such pay increases is hard to justify, given that the FTSE 100 collectively spent £720m on paying 224 top executives last year, according to the High Pay Centre / TUC study.  

The research paints a picture of boardroom excess that jars with the stark financial situation that millions of ordinary people are facing. If the pay chasm continues to widen, the consensus might tip in favour of some form of regulation – something that business definitely doesn’t want. 

It’s time for more business leaders to acknowledge the situation and show some semblance of solidarity with the rank and file by reducing the gap. Otherwise, the pressure for outside intervention will only ramp up. 



The post All in this together? Why it’s time for business leaders to read the room on executive pay appeared first on Raconteur.

]]>
CEO pockets a handful of notes

New research reveals that the median pay of CEOs in the FTSE 100 rose by 39% between 2020 and 2021, putting the spotlight on boardroom rewards once more  


As the cost-of-living-crisis forces millions of people in the UK to cut their spending drastically to make ends meet, a study by the High Pay Centre and the Trades Union Congress (TUC) has found that the median FTSE-100 chief executive took home £3.41m in 2021, compared with £2.46m the year before. That equates to an annual pay rise of 39%. 

Meanwhile, the average British worker has received a real-terms cut of 3%, according to the Office for National Statistics (ONS), as pay awards fail to match soaring inflation. Darren Morgan, director of economic statistics at the ONS, has described this as the fastest fall in the real value of pay in this country since comparable records began. 

Unsurprisingly, the pay gap between blue-chip bosses and the average employee widened significantly in 2021. The median CEO reward package in the FTSE 100 last year was 109 times larger than the median earnings of a full-time worker (£31,285), compared with a mere 79 times in 2020. The highest-paid chief executive in the FTSE 100, Endeavour Mining’s Sébastien de Montessus, received £16.85m.  

A potential tipping point 

The research has prompted the usual calls for the pay of business leaders to be capped or in some way linked to the earnings of the lowest-paid workers in their companies. They may well think that they can weather this storm of protest again, just as they always have, but things feel different this year. 

Much of the industrial action that thousands of workers have taken to improve their pay looks set to extend beyond the ‘summer of discontent’, so named by commentators likening the situation to the winter of discontent – a wave of strikes that brought down the Labour government during a period of high inflation in 1979.  

Railway workers have been picketing in pursuit of a sub-inflation pay rise of 7%. Network Rail’s chief executive, Andrew Haines, recently saw his salary increase by 8.5%, from £544,000 to £590,000. He earns about 20 times more than the average train guard. 

Journalists at Reach, which owns the Daily Mirror and Daily Star, are set to walk out in response to a proposed pay deal they claim is equivalent to a 7% cut in real terms. Meanwhile, the pay of its CEO, Jim Mullen, has risen by 700% (thanks partly to a long-term incentive plan, which won’t mature until 2024). Wildcat strikes are also on the rise as dissatisfaction spreads through the nation’s workplaces. 

The idea that bosses can deny their workers the pay rises they’re requesting amid the cost-of-living crisis while increasing their own to such an extent feels out of step with the mood of the nation. Widespread concern about inflation – particularly soaring energy prices – is shaking consumer confidence. When this falters, so does the economy. 

In touch with reality 

What, then, are the solutions? Proposals from the High Pay Centre and research organisation Autonomy to cap CEOs’ salaries at £200,000 seem unworkable. Such a move would prevent British businesses from competing for the best executive talent, harming them and the economy in the long run.  

But business leaders do need to show that they are listening. That is what PwC’s partners have done. The auditing giant’s leaders have pledged to take a pay cut to fund inflation-beating increases for lower-paid staff.  

Such sacrifices can pay off for the business in the long run. Rewarding employees and supporting them through tough economic times should make them less inclined to seek more lucrative work with a competitor, for instance. The cost of high staff turnover to a business, especially in the UK’s tight labour market, could end up exceeding that of granting a decent pay rise across the board. 

The argument that the money isn’t available for such pay increases is hard to justify, given that the FTSE 100 collectively spent £720m on paying 224 top executives last year, according to the High Pay Centre / TUC study.  

The research paints a picture of boardroom excess that jars with the stark financial situation that millions of ordinary people are facing. If the pay chasm continues to widen, the consensus might tip in favour of some form of regulation – something that business definitely doesn’t want. 

It’s time for more business leaders to acknowledge the situation and show some semblance of solidarity with the rank and file by reducing the gap. Otherwise, the pressure for outside intervention will only ramp up. 



The post All in this together? Why it’s time for business leaders to read the room on executive pay appeared first on Raconteur.

]]>
Why going green makes good business sense https://www.raconteur.net/sustainability/why-going-green-equals-growth-and-good-business/ Thu, 25 Aug 2022 14:26:41 +0000 //www.raconteur.net/?p=157903

Sustainability is no fad. In an environmentally conscious marketplace, it’s an essential element of business success


Joni Mitchell’s iconic 1970 song “Big Yellow Taxi” pleads: “Give me spots on my apples but leave me the birds and bees”. At the time of its release, this protest at the widespread use of chemical pesticides seemed like a Hail Mary. Would farmers and their counterparts in other industries really heed this call for a more ecologically friendly version of capitalism?

Now, more than half a century later, corporations are doing just that, having started integrating more sustainable practices into their business models. What’s more, they have found that – in an environmentally conscious marketplace – sustainability can actually be good for business. 

Shel Horowitz, founder of Going Beyond Sustainability, a consultancy which guides businesses toward greener practices, traces the origins of this movement to the publication of Rachel Carson’s Silent Spring in 1962. This prescient volume detailed the alarming effects of pesticides on the environment and precipitated a groundswell of activism aimed at holding industry accountable for its effects on the environment.

The voices of consumer activists remain an essential motivator today. Legislative efforts such as the UN Sustainable Development Goals, the 2021 Environment Act in the UK, and the EU’s Environment Action Programme have provided extra impetus. But in fact, many companies now undertake sustainable initiatives of their own volition. Taking responsibility, it seems, is just good business nowadays.

Across industries, sustainability is increasingly seen as a vital aspect of most consumer-facing businesses. Half measures are no longer cutting it.

“If it’s treated as nice-to-have, it fails. It’s ultimately not successful for the business, its reputation or its objective – financially, socially or environmentally,” says Noa Gafni, executive director of the Rutgers Institute for Corporate Social Innovation. And there is growing demand for accountability. Auditing bodies now play a crucial role in certifying sustainability initiatives, providing the public with an objective measure of their success. 

“Greenwashing is real,” Gafni continues. “But companies are taking bigger steps to ensure that they aren’t doing that. They are partnering with external auditors to look at the places where they’re doing well and look at places where they can improve.”

 If sustainability is treated as nice-to-have, it fails. It’s ultimately not successful for the business, its reputation or its objective

“Consumers are becoming more sensitive to greenwashing. They will not hesitate to break off relationships with brands that do not take their stated commitments seriously,” observes Tara Milburn, founder of sustainable branding company Ethical Swag.

“Some companies will try to greenwash. They’ll try to avoid the certifying body,” adds Robert Bird, Eversource Energy Chair in Business Ethics at the University of Connecticut. “But the certifying body will find out what’s going on. They’ll make the problems public. Then the company improves. There is some cat and mouse involved, but there’s a long arc towards improvement.”

In practice, sustainability initiatives work best when they are distributed evenly across the value chain. “They should be implemented across all primary activities, as well as secondary activities including infrastructure, technological development and procurement,” says Juan Carlos Lascurain of Lascurain-Grosvenor Sports Brokerage, a firm which has previously assisted sports stadiums around the world in greening their operations. 

“They absolutely cannot be siloed,” Gafni explains. “That’s the tricky part. When you’re trying to get something like this off the ground, it requires levels of collaboration that organisations aren’t necessarily used to. It’s important that they partner not only internally with different parts of the organisation, but also externally.”

Indeed, the effect of these initiatives is not solely internal; supply chain pressure has created a competitive marketplace in which suppliers vie to demonstrate their green credentials to their clients. 

“Consumers are not just concerned with practices at the retail level, such as Nike stores or Apple stores,” Bird observes. “They’re also interested in Apple and Nike’s supply chains – the people they buy their supplies from, the people their suppliers buy their supplies from. Are these people given a living wage? Are they engaging in environmentally aware practices?”

“Every business has an upstream and downstream in their supply chain, where their business is the crux,” says Stacy Savage, founder and CEO at Zero Waste Strategies in Austin, Texas. “All the operational decisions that happen within that crux affect what happens upstream and downstream. The buyer really holds all the cards. If the current vendor can’t do what they’re asking, then they can always go and look for a new vendor.”

She cites the example of a business that expresses a desire to avoid the use of cardboard in its shipping operations. It could demand that its shippers use reusable, collapsible crates, reuse those crates itself, and ask that clients on the receiving end also reuse them.

If suppliers don’t get on board, says Simon Glynn, co-lead of consulting firm Oliver Wyman’s climate and sustainability platform, “they won’t get access to the best partners. They won’t get access to the best contracts. And they may be excluded from procurement opportunities.”

Still, value chain implementation varies by industry. “For a business without physical products, like a SaaS business, I would imagine that sustainability initiatives sit lower on the value chain,” notes Calloway Cook, president of Illuminate Labs, a certified B Corp which is required to meet certain environmental and social standards.

Location can also play a key role. As Lascurain relates, companies in northern Europe may have significant tax incentives and cultural motivation to take steps toward sustainability. Conversely, those located in the developing world may be more resistant. He confides that clients in South America have proven far less willing to adopt these measures – although when they have done so, they have proven successful nonetheless.

While companies established in recent years have tended to bake sustainable principles into their operations as a matter of course, sustainability can be more difficult for sprawling legacy corporations with operations that extend across the globe.

“Companies that are deeply attached to a product or service that is inherently unsustainable require a fundamental change in how they operate,” Bird cautions. “They are going to have the most difficulty making changes. Companies that are more B2B are also less likely to feel the pressure from consumers, and industries that have a very slim profit margin may not be able to invest in sustainable practices.”

But that does not mean that larger corporations are incapable of integrating sustainable practices into their value chains. Gafni cites the example of British consumer conglomerate Unilever. “Their former CEO Paul Polman was a driving force,” she says. “But their sustainability plan was also supported by people in middle management. It’s important that you not only have the vision from the top, but champions in different functional areas to understand how to get things done from a practical standpoint.”

This point – that leadership is important on all levels – is echoed by most people who work on facilitating sustainability in the corporate world. Directives from the top can certainly have a major impact. But so too can pressure from lower-level employees. 

“It can come from all angles,” says Savage. “The biggest pressure generator is when you have a scenario where your employees say, ‘Hey, we have 3,000 employees and a cafeteria. Why aren’t we composting?’” 

When these messages reach upper management and combine with external pressure from environmental advocates, they put pressure on middle management to implement real change. That, she claims, is where consultancies like hers can come in and help the often bewildered functionaries to implement meaningful alterations to a company’s practices.

When you're trying to get something like this off the ground, it requires levels of collaboration that organisations aren’t necessarily used to

Responsiveness to these demands translates into employee retention. Millennial and Gen-Z employees are insistent on seeing their values reflected in their employers. If they feel their values are in conflict, they will leave, taking their institutional knowledge with them and forcing their former employers to sink money into training new employees. Conversely, if they see that their employers are aligned with their principles, they will stay and reinforce them, contributing to the organisational knowledge pool.

But where should proactive leaders start? While the ultimate goal is sustainability across the value chain, waste management is perhaps the lowest-hanging fruit. “There’s a whole circular economy now. We’re moving away from a linear, destructive economy,” Savage says. “Instead, you transform your waste into a product.”

She suggests that the goal of these types of projects should be to at least break even. But sustainability can actually conserve money – and even be profitable.

“Focus first on things that are going to actually earn money quickly. And then, as those become successful, you can use them to fund some of the deeper, more complicated initiatives. Keeping profitability in focus means that these efforts are less likely to be the victim of budget cuts when times are tough,” Horowitz advises.

He cites the $31m energy-efficiency retrofit of the Empire State Building in New York City. “It was a three-year payback. That’s a 33% return on investment. A fast-food restaurant might have a margin of 3% to 5%,” he enthuses. The adjustments have created millions in annual savings, and the building has attracted a suite of deep-pocketed new tenants.

Environmental, social and governance (ESG) criteria are also a significant factor in attracting new investments. “ESG standards are now one of the top-five indicators to investment firms and shareholders as to whether your company will still be viable and relevant in the next 10 years,” Savage notes. “Many of these firms are shunning companies that aren’t making an effort to get ESG policies in place. That’s huge if you want to expand your business.”

“Once companies and their employees become habituated to a certain value or a certain norm, they will practise sustainably almost reflexively. And they won’t have to make the conscious decision as to whether or not it’s profitable,” says Bird.

In fact, many of the benefits of sustainable practices are somewhat intangible. “It changes your relationship with your customers,” says Glynn. “Imagine you were selling a commodity like steel. Well now you’re providing something really differentiated because you’re providing zero-carbon steel. You’re having very different conversations with your customers. You’ve got a much more strategic relationship with your customers. They are bonded in some way into buying from you because it’s a different product than just commodity steel. Decommoditisation doesn’t necessarily directly turn into a premium, but it turns into more stable relationships and customer loyalty and deeper customer collaboration.”

This ultimately translates into good corporate citizenship. Whether or not these projects make or save money, they are likely to have positive impacts on the world at large. And that’s something worth encouraging.

The business case for sustainability

Sustainability is by definition a long game. Superficial sustainability measures no longer cut it in a heavily scrutinised market. Slapping a green label on a product or service simply doesn’t pass muster anymore – not with consumers, not with activists, not with business partners. 

By contrast, carefully considered initiatives that adjust practices across the value chain can have profound effects on business success. While decarbonisation may entail an initial investment, it more often than not means savings down the line – if not an actual profit. 

Waste and energy use reduction are among the most easily implemented sustainability practices. The savings accrued by these easy initial steps can then be used to subsidise more difficult, industry-specific actions. What’s more, pressure on suppliers can help to facilitate a competitive market in which relationships between individual organisations are increasingly contingent on sustainable standards.

Perhaps most importantly, sustainability can be crucial in securing investments for business expansion. Environmental, social and governance criteria are now a major factor for many investors when deciding whether or not to divert funds to a particular organisation. Demonstrably sustainable practices are considered key indicators of future business success. They indicate a likelihood that a given organisation will be compliant with increasingly stringent environmental regulations, thus avoiding liability. 

These commitments are also appealing to a vigilant consumer base which reacts poorly to unsustainable practices and rewards companies that can demonstrate their sustainable practices over time.

Millennial and Gen-Z members of the workforce often look for employers that share their purported values. A visible and verifiable commitment to sustainable practices can help companies attract and retain talent. Lower turnover means that human capital – the resources invested in training employees and the resulting repository of institutional knowledge – stays within the organisation. This can amount to significant cost savings in the long term.

As beneficial as sustainable practices may be to a given organisation, their benefits to the world at large are even more important. Corporate citizenship is now seen as an unavoidable responsibility. Just as individuals ought not to hope to accrue direct benefits from behaving with decency and consideration towards their fellow citizens, there is now an expectation that companies will do the same. 

Will these behaviours affect the bottom line in the near term? Perhaps. Perhaps not. But pursuing practices that benefit the planet and its inhabitants will help to maintain a healthy ecosystem – for people, for other living things and for business as well.



The post Why going green makes good business sense appeared first on Raconteur.

]]>

Sustainability is no fad. In an environmentally conscious marketplace, it’s an essential element of business success


Joni Mitchell’s iconic 1970 song “Big Yellow Taxi” pleads: “Give me spots on my apples but leave me the birds and bees”. At the time of its release, this protest at the widespread use of chemical pesticides seemed like a Hail Mary. Would farmers and their counterparts in other industries really heed this call for a more ecologically friendly version of capitalism?

Now, more than half a century later, corporations are doing just that, having started integrating more sustainable practices into their business models. What’s more, they have found that – in an environmentally conscious marketplace – sustainability can actually be good for business. 

Shel Horowitz, founder of Going Beyond Sustainability, a consultancy which guides businesses toward greener practices, traces the origins of this movement to the publication of Rachel Carson’s Silent Spring in 1962. This prescient volume detailed the alarming effects of pesticides on the environment and precipitated a groundswell of activism aimed at holding industry accountable for its effects on the environment.

The voices of consumer activists remain an essential motivator today. Legislative efforts such as the UN Sustainable Development Goals, the 2021 Environment Act in the UK, and the EU’s Environment Action Programme have provided extra impetus. But in fact, many companies now undertake sustainable initiatives of their own volition. Taking responsibility, it seems, is just good business nowadays.

Across industries, sustainability is increasingly seen as a vital aspect of most consumer-facing businesses. Half measures are no longer cutting it.

“If it’s treated as nice-to-have, it fails. It’s ultimately not successful for the business, its reputation or its objective – financially, socially or environmentally,” says Noa Gafni, executive director of the Rutgers Institute for Corporate Social Innovation. And there is growing demand for accountability. Auditing bodies now play a crucial role in certifying sustainability initiatives, providing the public with an objective measure of their success. 

“Greenwashing is real,” Gafni continues. “But companies are taking bigger steps to ensure that they aren’t doing that. They are partnering with external auditors to look at the places where they’re doing well and look at places where they can improve.”

 If sustainability is treated as nice-to-have, it fails. It’s ultimately not successful for the business, its reputation or its objective

“Consumers are becoming more sensitive to greenwashing. They will not hesitate to break off relationships with brands that do not take their stated commitments seriously,” observes Tara Milburn, founder of sustainable branding company Ethical Swag.

“Some companies will try to greenwash. They’ll try to avoid the certifying body,” adds Robert Bird, Eversource Energy Chair in Business Ethics at the University of Connecticut. “But the certifying body will find out what’s going on. They’ll make the problems public. Then the company improves. There is some cat and mouse involved, but there’s a long arc towards improvement.”

In practice, sustainability initiatives work best when they are distributed evenly across the value chain. “They should be implemented across all primary activities, as well as secondary activities including infrastructure, technological development and procurement,” says Juan Carlos Lascurain of Lascurain-Grosvenor Sports Brokerage, a firm which has previously assisted sports stadiums around the world in greening their operations. 

“They absolutely cannot be siloed,” Gafni explains. “That’s the tricky part. When you’re trying to get something like this off the ground, it requires levels of collaboration that organisations aren’t necessarily used to. It’s important that they partner not only internally with different parts of the organisation, but also externally.”

Indeed, the effect of these initiatives is not solely internal; supply chain pressure has created a competitive marketplace in which suppliers vie to demonstrate their green credentials to their clients. 

“Consumers are not just concerned with practices at the retail level, such as Nike stores or Apple stores,” Bird observes. “They’re also interested in Apple and Nike’s supply chains – the people they buy their supplies from, the people their suppliers buy their supplies from. Are these people given a living wage? Are they engaging in environmentally aware practices?”

“Every business has an upstream and downstream in their supply chain, where their business is the crux,” says Stacy Savage, founder and CEO at Zero Waste Strategies in Austin, Texas. “All the operational decisions that happen within that crux affect what happens upstream and downstream. The buyer really holds all the cards. If the current vendor can’t do what they’re asking, then they can always go and look for a new vendor.”

She cites the example of a business that expresses a desire to avoid the use of cardboard in its shipping operations. It could demand that its shippers use reusable, collapsible crates, reuse those crates itself, and ask that clients on the receiving end also reuse them.

If suppliers don’t get on board, says Simon Glynn, co-lead of consulting firm Oliver Wyman’s climate and sustainability platform, “they won’t get access to the best partners. They won’t get access to the best contracts. And they may be excluded from procurement opportunities.”

Still, value chain implementation varies by industry. “For a business without physical products, like a SaaS business, I would imagine that sustainability initiatives sit lower on the value chain,” notes Calloway Cook, president of Illuminate Labs, a certified B Corp which is required to meet certain environmental and social standards.

Location can also play a key role. As Lascurain relates, companies in northern Europe may have significant tax incentives and cultural motivation to take steps toward sustainability. Conversely, those located in the developing world may be more resistant. He confides that clients in South America have proven far less willing to adopt these measures – although when they have done so, they have proven successful nonetheless.

While companies established in recent years have tended to bake sustainable principles into their operations as a matter of course, sustainability can be more difficult for sprawling legacy corporations with operations that extend across the globe.

“Companies that are deeply attached to a product or service that is inherently unsustainable require a fundamental change in how they operate,” Bird cautions. “They are going to have the most difficulty making changes. Companies that are more B2B are also less likely to feel the pressure from consumers, and industries that have a very slim profit margin may not be able to invest in sustainable practices.”

But that does not mean that larger corporations are incapable of integrating sustainable practices into their value chains. Gafni cites the example of British consumer conglomerate Unilever. “Their former CEO Paul Polman was a driving force,” she says. “But their sustainability plan was also supported by people in middle management. It’s important that you not only have the vision from the top, but champions in different functional areas to understand how to get things done from a practical standpoint.”

This point – that leadership is important on all levels – is echoed by most people who work on facilitating sustainability in the corporate world. Directives from the top can certainly have a major impact. But so too can pressure from lower-level employees. 

“It can come from all angles,” says Savage. “The biggest pressure generator is when you have a scenario where your employees say, ‘Hey, we have 3,000 employees and a cafeteria. Why aren’t we composting?’” 

When these messages reach upper management and combine with external pressure from environmental advocates, they put pressure on middle management to implement real change. That, she claims, is where consultancies like hers can come in and help the often bewildered functionaries to implement meaningful alterations to a company’s practices.

When you're trying to get something like this off the ground, it requires levels of collaboration that organisations aren’t necessarily used to

Responsiveness to these demands translates into employee retention. Millennial and Gen-Z employees are insistent on seeing their values reflected in their employers. If they feel their values are in conflict, they will leave, taking their institutional knowledge with them and forcing their former employers to sink money into training new employees. Conversely, if they see that their employers are aligned with their principles, they will stay and reinforce them, contributing to the organisational knowledge pool.

But where should proactive leaders start? While the ultimate goal is sustainability across the value chain, waste management is perhaps the lowest-hanging fruit. “There’s a whole circular economy now. We’re moving away from a linear, destructive economy,” Savage says. “Instead, you transform your waste into a product.”

She suggests that the goal of these types of projects should be to at least break even. But sustainability can actually conserve money – and even be profitable.

“Focus first on things that are going to actually earn money quickly. And then, as those become successful, you can use them to fund some of the deeper, more complicated initiatives. Keeping profitability in focus means that these efforts are less likely to be the victim of budget cuts when times are tough,” Horowitz advises.

He cites the $31m energy-efficiency retrofit of the Empire State Building in New York City. “It was a three-year payback. That’s a 33% return on investment. A fast-food restaurant might have a margin of 3% to 5%,” he enthuses. The adjustments have created millions in annual savings, and the building has attracted a suite of deep-pocketed new tenants.

Environmental, social and governance (ESG) criteria are also a significant factor in attracting new investments. “ESG standards are now one of the top-five indicators to investment firms and shareholders as to whether your company will still be viable and relevant in the next 10 years,” Savage notes. “Many of these firms are shunning companies that aren’t making an effort to get ESG policies in place. That’s huge if you want to expand your business.”

“Once companies and their employees become habituated to a certain value or a certain norm, they will practise sustainably almost reflexively. And they won’t have to make the conscious decision as to whether or not it’s profitable,” says Bird.

In fact, many of the benefits of sustainable practices are somewhat intangible. “It changes your relationship with your customers,” says Glynn. “Imagine you were selling a commodity like steel. Well now you’re providing something really differentiated because you’re providing zero-carbon steel. You’re having very different conversations with your customers. You’ve got a much more strategic relationship with your customers. They are bonded in some way into buying from you because it’s a different product than just commodity steel. Decommoditisation doesn’t necessarily directly turn into a premium, but it turns into more stable relationships and customer loyalty and deeper customer collaboration.”

This ultimately translates into good corporate citizenship. Whether or not these projects make or save money, they are likely to have positive impacts on the world at large. And that’s something worth encouraging.

The business case for sustainability

Sustainability is by definition a long game. Superficial sustainability measures no longer cut it in a heavily scrutinised market. Slapping a green label on a product or service simply doesn’t pass muster anymore – not with consumers, not with activists, not with business partners. 

By contrast, carefully considered initiatives that adjust practices across the value chain can have profound effects on business success. While decarbonisation may entail an initial investment, it more often than not means savings down the line – if not an actual profit. 

Waste and energy use reduction are among the most easily implemented sustainability practices. The savings accrued by these easy initial steps can then be used to subsidise more difficult, industry-specific actions. What’s more, pressure on suppliers can help to facilitate a competitive market in which relationships between individual organisations are increasingly contingent on sustainable standards.

Perhaps most importantly, sustainability can be crucial in securing investments for business expansion. Environmental, social and governance criteria are now a major factor for many investors when deciding whether or not to divert funds to a particular organisation. Demonstrably sustainable practices are considered key indicators of future business success. They indicate a likelihood that a given organisation will be compliant with increasingly stringent environmental regulations, thus avoiding liability. 

These commitments are also appealing to a vigilant consumer base which reacts poorly to unsustainable practices and rewards companies that can demonstrate their sustainable practices over time.

Millennial and Gen-Z members of the workforce often look for employers that share their purported values. A visible and verifiable commitment to sustainable practices can help companies attract and retain talent. Lower turnover means that human capital – the resources invested in training employees and the resulting repository of institutional knowledge – stays within the organisation. This can amount to significant cost savings in the long term.

As beneficial as sustainable practices may be to a given organisation, their benefits to the world at large are even more important. Corporate citizenship is now seen as an unavoidable responsibility. Just as individuals ought not to hope to accrue direct benefits from behaving with decency and consideration towards their fellow citizens, there is now an expectation that companies will do the same. 

Will these behaviours affect the bottom line in the near term? Perhaps. Perhaps not. But pursuing practices that benefit the planet and its inhabitants will help to maintain a healthy ecosystem – for people, for other living things and for business as well.



The post Why going green makes good business sense appeared first on Raconteur.

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Have apprenticeships finally come of age in the UK? https://www.raconteur.net/hr/have-apprenticeships-finally-come-of-age-in-the-uk/ Wed, 24 Aug 2022 15:00:11 +0000 //www.raconteur.net/?p=157890 Manager helps out an apprentice in the office

Apprenticeships have long seen as poor relations to university courses, but that is changing. Work-based programmes leading to degree-level qualifications could be key to solving the UK’s skills crisis


Tens of thousands of A-level students missed out on their first-choice university courses this year. Competition for places in the clearing system was tougher than it has been in living memory, while even high achievers had their dreams of studying medicine and dentistry crushed, as only 16% of applications for these popular courses were accepted. 

While employers view some degrees to be of limited value in the workplace, the burden of undergraduate debt keeps growing. The government has estimated that university students in last year’s intake will borrow about £45,800 each on average before they graduate. 

It’s hardly surprising that the received wisdom in the UK that university is the natural educational progression for most able students is being challenged

Rising to fill the void are apprenticeships. Once widely dismissed by students, parents and many employers as inferior to degree courses, work-based vocational learning programmes that culminate in degree-level qualifications are becoming increasingly popular. Could the nation finally be losing some of its academic snobbery?

Employers are certainly coming to view apprenticeships as an effective way to meet the evolving skills needs of their fast-changing workplaces, especially if they can get involved in designing such schemes. They include Formula One team McLaren Racing

“Apprenticeships are being developed by industry to ensure that they are relevant to its current technology and practice, and much more aligned with its future skills requirements,” says McLaren’s head of diversity, early careers and development, Kate O’Hara-Hatchley.  “Companies can create unique apprenticeship programmes that, in combination with the apprenticeship standard, will build true home-grown talent.” 

A variety of schemes

Many companies offer apprenticeship schemes running from level 3, which is equivalent to two A-level passes, through to level 7, which is considered comparable to a master’s degree in disciplines such as accounting.

They also support a learning path that leads to the many accreditations required by certain sectors. Taking insurance as an example, Lloyd’s of London offers a level 4 professional apprenticeship, which is an important step towards the Chartered Insurance Institute diploma qualification. It also offers a level 6 digital and technology solutions professional standard, which incorporates a BSc honours degree. 

Meanwhile, Vodafone offers qualifications at levels 3, 4 and 6 in fields including software engineering, data analytics and network engineering. These programmes also cover HR and project management. 

Our programmes are key to bringing in diverse talent. They result in apprentices who are fully fledged members of their teams and have real responsibility

Leading Vodafone UK’s apprenticeship schemes is its talent and capability manager, Asha Jagatia. These schemes, she says, are “fundamental”, given that the company often finds it hard to recruit people with “business-critical skills” in a competitive employment market. 

“Our programmes are key to bringing in diverse talent. They result in apprentices who are fully fledged members of their teams and have real responsibility,” Jagatia says.

The idea that apprenticeships produce employees who tend to have a little more initiative than the average graduate recruit, who will have spent years steeped in academia, is widely accepted among employers that take on apprentices. 

“The great benefit of apprenticeships is that participants don’t just learn technical skills. They build professional skills and work-readiness at the same time, creating well-rounded talent,” O’Hara-Hatchley says.

Apprentices bring new perspectives

Sara Gomez, chief people officer at Lloyd’s of London, agrees. “Most of our apprentices are from gen Z. They’re generally more interested in, and informed about, sociopolitical, technological and environmental issues than previous generations were at their age. That means they want to start making a tangible impact as soon as possible.”

Enabling apprentices to sample academia (many schemes require them to attend college or university one or two days a week) while also earning a salary is a key benefit of such programmes. Employers report that participants view establishing some financial security rather than running up debt on a full-time degree course as a big plus. But the ability to establish their own ‘employee brand’ early on is another major attraction to apprentices, which gives them much of their drive to succeed. 

Ian Levers, technical excellence portfolio manager at engineering consultancy Mott MacDonald, describes how one of his apprentices has grasped the opportunity. “Apprenticeships really are what you make of them,” he says. “Our apprentice has done exactly this, taking on new challenges, developing herself and raising her profile on LinkedIn to grow her internal and external networks. She was named Apprentice of the Year 2021 by the Royal Institution of Chartered Surveyors – clear evidence of what’s achievable with a growth and learning mindset.” 

Levers adds that apprentices are also important in bringing new perspectives to the business, which can learn from them. “They add significant benefits to their teams through fresh, innovative ideas that may challenge industry norms.”

We need curious minds from diverse backgrounds, so we’re looking for people with fresh perspectives and the confidence to share them

While there has been a significant increase in the number of students exploring this route who would typically have expected to go to university, it is widely agreed that apprenticeships are proving particularly useful in both attracting people who have traditionally been excluded from higher education and diversifying the talent pool generally. 

“Given that university isn’t an option for everyone owing to the cost, apprenticeships are an inclusive route,” O’Hara-Hatchley says. 

Her company runs a diversity, equity and inclusion programme called McLaren Racing Engage. This is an alliance with the Women’s Engineering Society, EqualEngineers, Creative Access and The Smallpeice Trust to attract people from under-represented groups into the motorsport industry through long-term investments in grass-roots initiatives and schemes such as mentoring programmes. 

Gomez reveals that 30% of Lloyd’s intake this September will be people from ethnic minorities (“above the market average”) while 27% will be applicants from disadvantaged backgrounds. This is not pure altruism, she stresses, adding: “We need curious minds from diverse backgrounds, so we’re looking for people with fresh perspectives and the confidence to share them.”

Making the apprenticeship levy work

There is a range of government support packages on offer for employers seeking to provide apprenticeships. The most notable of these is the apprenticeship levy, which is funded by a 0.5% tax on the wage bills of all companies with annual payrolls exceeding £3m. 

The levy has disrupted how HR functions “deploy their talent strategies”, according to Gomez. “It can be used to attract and retain talent, providing a breadth of opportunities across a range of domains. It can be used for entry-level talent to develop both soft and technical skills, while also increasing the function-specific expertise and future management capabilities of existing staff.”

But, as with many government schemes, the system does not yet work as smoothly as it should. Critics complain that its complexity is deterring employers from participating. More than £3.3bn in levy funding has been returned unused to the Treasury since 2019, for instance.

And what of all the disappointed would-be students of medicine and dentistry? Surely apprenticeship schemes have their limits when competing with university courses? Not so. In July, Health Education England announced that students would be able to pursue a medical doctor degree apprenticeship offering the same standard of education as that provided by a traditional university course. 

Welcoming the development, Jennifer Coupland, CEO of the Institute for Apprenticeships and Technical Education, neatly summed up the advance of apprenticeships in recent years. 

“For many, seeing that an apprentice can become a medical doctor will be a big surprise, but employers are driving a change in the way we think about skills in this country,” she said. “Not everyone’s journey to career success has to be the same.”



The post Have apprenticeships finally come of age in the UK? appeared first on Raconteur.

]]>
Manager helps out an apprentice in the office

Apprenticeships have long seen as poor relations to university courses, but that is changing. Work-based programmes leading to degree-level qualifications could be key to solving the UK’s skills crisis


Tens of thousands of A-level students missed out on their first-choice university courses this year. Competition for places in the clearing system was tougher than it has been in living memory, while even high achievers had their dreams of studying medicine and dentistry crushed, as only 16% of applications for these popular courses were accepted. 

While employers view some degrees to be of limited value in the workplace, the burden of undergraduate debt keeps growing. The government has estimated that university students in last year’s intake will borrow about £45,800 each on average before they graduate. 

It’s hardly surprising that the received wisdom in the UK that university is the natural educational progression for most able students is being challenged

Rising to fill the void are apprenticeships. Once widely dismissed by students, parents and many employers as inferior to degree courses, work-based vocational learning programmes that culminate in degree-level qualifications are becoming increasingly popular. Could the nation finally be losing some of its academic snobbery?

Employers are certainly coming to view apprenticeships as an effective way to meet the evolving skills needs of their fast-changing workplaces, especially if they can get involved in designing such schemes. They include Formula One team McLaren Racing

“Apprenticeships are being developed by industry to ensure that they are relevant to its current technology and practice, and much more aligned with its future skills requirements,” says McLaren’s head of diversity, early careers and development, Kate O’Hara-Hatchley.  “Companies can create unique apprenticeship programmes that, in combination with the apprenticeship standard, will build true home-grown talent.” 

A variety of schemes

Many companies offer apprenticeship schemes running from level 3, which is equivalent to two A-level passes, through to level 7, which is considered comparable to a master’s degree in disciplines such as accounting.

They also support a learning path that leads to the many accreditations required by certain sectors. Taking insurance as an example, Lloyd’s of London offers a level 4 professional apprenticeship, which is an important step towards the Chartered Insurance Institute diploma qualification. It also offers a level 6 digital and technology solutions professional standard, which incorporates a BSc honours degree. 

Meanwhile, Vodafone offers qualifications at levels 3, 4 and 6 in fields including software engineering, data analytics and network engineering. These programmes also cover HR and project management. 

Our programmes are key to bringing in diverse talent. They result in apprentices who are fully fledged members of their teams and have real responsibility

Leading Vodafone UK’s apprenticeship schemes is its talent and capability manager, Asha Jagatia. These schemes, she says, are “fundamental”, given that the company often finds it hard to recruit people with “business-critical skills” in a competitive employment market. 

“Our programmes are key to bringing in diverse talent. They result in apprentices who are fully fledged members of their teams and have real responsibility,” Jagatia says.

The idea that apprenticeships produce employees who tend to have a little more initiative than the average graduate recruit, who will have spent years steeped in academia, is widely accepted among employers that take on apprentices. 

“The great benefit of apprenticeships is that participants don’t just learn technical skills. They build professional skills and work-readiness at the same time, creating well-rounded talent,” O’Hara-Hatchley says.

Apprentices bring new perspectives

Sara Gomez, chief people officer at Lloyd’s of London, agrees. “Most of our apprentices are from gen Z. They’re generally more interested in, and informed about, sociopolitical, technological and environmental issues than previous generations were at their age. That means they want to start making a tangible impact as soon as possible.”

Enabling apprentices to sample academia (many schemes require them to attend college or university one or two days a week) while also earning a salary is a key benefit of such programmes. Employers report that participants view establishing some financial security rather than running up debt on a full-time degree course as a big plus. But the ability to establish their own ‘employee brand’ early on is another major attraction to apprentices, which gives them much of their drive to succeed. 

Ian Levers, technical excellence portfolio manager at engineering consultancy Mott MacDonald, describes how one of his apprentices has grasped the opportunity. “Apprenticeships really are what you make of them,” he says. “Our apprentice has done exactly this, taking on new challenges, developing herself and raising her profile on LinkedIn to grow her internal and external networks. She was named Apprentice of the Year 2021 by the Royal Institution of Chartered Surveyors – clear evidence of what’s achievable with a growth and learning mindset.” 

Levers adds that apprentices are also important in bringing new perspectives to the business, which can learn from them. “They add significant benefits to their teams through fresh, innovative ideas that may challenge industry norms.”

We need curious minds from diverse backgrounds, so we’re looking for people with fresh perspectives and the confidence to share them

While there has been a significant increase in the number of students exploring this route who would typically have expected to go to university, it is widely agreed that apprenticeships are proving particularly useful in both attracting people who have traditionally been excluded from higher education and diversifying the talent pool generally. 

“Given that university isn’t an option for everyone owing to the cost, apprenticeships are an inclusive route,” O’Hara-Hatchley says. 

Her company runs a diversity, equity and inclusion programme called McLaren Racing Engage. This is an alliance with the Women’s Engineering Society, EqualEngineers, Creative Access and The Smallpeice Trust to attract people from under-represented groups into the motorsport industry through long-term investments in grass-roots initiatives and schemes such as mentoring programmes. 

Gomez reveals that 30% of Lloyd’s intake this September will be people from ethnic minorities (“above the market average”) while 27% will be applicants from disadvantaged backgrounds. This is not pure altruism, she stresses, adding: “We need curious minds from diverse backgrounds, so we’re looking for people with fresh perspectives and the confidence to share them.”

Making the apprenticeship levy work

There is a range of government support packages on offer for employers seeking to provide apprenticeships. The most notable of these is the apprenticeship levy, which is funded by a 0.5% tax on the wage bills of all companies with annual payrolls exceeding £3m. 

The levy has disrupted how HR functions “deploy their talent strategies”, according to Gomez. “It can be used to attract and retain talent, providing a breadth of opportunities across a range of domains. It can be used for entry-level talent to develop both soft and technical skills, while also increasing the function-specific expertise and future management capabilities of existing staff.”

But, as with many government schemes, the system does not yet work as smoothly as it should. Critics complain that its complexity is deterring employers from participating. More than £3.3bn in levy funding has been returned unused to the Treasury since 2019, for instance.

And what of all the disappointed would-be students of medicine and dentistry? Surely apprenticeship schemes have their limits when competing with university courses? Not so. In July, Health Education England announced that students would be able to pursue a medical doctor degree apprenticeship offering the same standard of education as that provided by a traditional university course. 

Welcoming the development, Jennifer Coupland, CEO of the Institute for Apprenticeships and Technical Education, neatly summed up the advance of apprenticeships in recent years. 

“For many, seeing that an apprentice can become a medical doctor will be a big surprise, but employers are driving a change in the way we think about skills in this country,” she said. “Not everyone’s journey to career success has to be the same.”



The post Have apprenticeships finally come of age in the UK? appeared first on Raconteur.

]]>
What business leaders can do to foster disability inclusion https://www.raconteur.net/business-strategy/leadership/leaders-disability-inclusion/ Wed, 24 Aug 2022 14:41:09 +0000 //www.raconteur.net/?p=157762 illustration of disability in leadership

From implementing inclusive policies to acting as role models, those at the top of an organisation have the power - and responsibility - to make work better for those with disabilities


illustration of disability in leadership

No executives or senior managers at any of the FTSE 100 companies have disclosed they have a disability. That’s according to a report published last year by Tortoise Media and global business collective the Valuable 500. 

The issue extends beyond the UK’s biggest companies. A recent EY study found that 7% of C-suite executives have some lived experience of disability but four in five of them had chosen not to disclose. 

The Tortoise survey found that just 12 of the companies in the FTSE 100 report on the total number of employees who are disclosed as disabled, while only a further eight give employees the opportunity to disclose. Even among those that do, with such a lack of representation at the top of business, how realistic is it that employees will share their own status?

The importance of role models

There is still a real fear around disclosure, says Ollie Thorn, senior manager of DE&I client solutions at recruitment firm Michael Page. “A lot of people working up to those top positions are ambitious,” he says. “They think ‘I’ve got to hide this, because I can’t see any leaders who have a disability, so obviously I can’t be a leader if I’ve got one’.” 

This lack of openness at the highest level can suggest to other people with disabilities that their own disclosure might not be welcome. More significantly, it makes it far harder to create a culture which is inclusive and accessible for everyone. 

We need to dispel some of these myths that employers have about disabled people

“If we can’t see role models at the top of an organisation talking about disability,” says Caroline Casey, founder of the Valuable 500, “then it becomes a difficult issue because we’re pleading for accommodations.” 

From remote working to ramps in the office, the factors that could improve the daily working lives of employees with disabilities are far easier to secure when business leaders see it as a priority.

Fighting stigma at the highest level 

What is driving this fear of disclosure? Many of those with disabilities worry about being viewed differently, taken less seriously or seen as less able. Some believe it will keep them from jobs or promotions or that, by asking for the accommodations they need, they will be seen as demanding or difficult. 

To tackle this fear, two things are needed, says Mark Esho founder of social enterprise The Circle Foundation. The first is representation. “If you look back 10 years, how many Black people did you see in adverts? Possibly zero. Now, we see it all the time. The only advert I’ve seen with a disabled person is the Sure one. As a society we need to bring more disabled people to the forefront.”

We can’t just have lip service. We need leadership to invest in this area and ensure there’s accountability.

The second thing that is needed, says Esho, is education, particularly among business leaders. “We need to dispel some of these myths that employers have about disabled people: that we lack education, we’re lazy, we don’t have the right skills or that once you employ a disabled person, you’ll never be able to get rid of them.” 

Better education and better support for employers will help them understand what employing someone with a disability actually entails.

How leaders can create inclusive workplaces

Leaders set the tone for the culture in an organisation meaning that, whether they have a disability or not, they are ultimately responsible for creating workplaces where all employees can thrive. Unfortunately, this is all too rare. The same EY study found that 54% of global boards have never had a conversation about disability. And although 90% of organisations say they are “passionate about inclusion”, only 4% include disability in their inclusion initiatives. 

“We can’t just have lip service,” says Casey. “We need leadership to invest in this area and ensure there’s accountability.” 

What this looks like in a practical sense is simple, she says: “Leaders need to strategically integrate disability into the business, and they need to put money and resources behind it. Then they need to talk to the people in their business who have experience with disabilities, using resources like internal employee support groups.” 

It’s not just those at the top who can drive change, says Burcu Borysik, head of policy and campaigns at Crohn’s & Colitis UK. “I absolutely agree with the importance of leaders being role models, but leadership is also dispersed,” she says. “There is power in pretty much everyone speaking up, regardless of their level or title in the organisation.” 
Setting an example at C-suite level empowers those in the rest of an organisation to come forward and speak out. And, if business leaders can create a culture of openness and inclusion, postive change will follow for everyone.



The post What business leaders can do to foster disability inclusion appeared first on Raconteur.

]]>
illustration of disability in leadership

From implementing inclusive policies to acting as role models, those at the top of an organisation have the power - and responsibility - to make work better for those with disabilities


illustration of disability in leadership

No executives or senior managers at any of the FTSE 100 companies have disclosed they have a disability. That’s according to a report published last year by Tortoise Media and global business collective the Valuable 500. 

The issue extends beyond the UK’s biggest companies. A recent EY study found that 7% of C-suite executives have some lived experience of disability but four in five of them had chosen not to disclose. 

The Tortoise survey found that just 12 of the companies in the FTSE 100 report on the total number of employees who are disclosed as disabled, while only a further eight give employees the opportunity to disclose. Even among those that do, with such a lack of representation at the top of business, how realistic is it that employees will share their own status?

The importance of role models

There is still a real fear around disclosure, says Ollie Thorn, senior manager of DE&I client solutions at recruitment firm Michael Page. “A lot of people working up to those top positions are ambitious,” he says. “They think ‘I’ve got to hide this, because I can’t see any leaders who have a disability, so obviously I can’t be a leader if I’ve got one’.” 

This lack of openness at the highest level can suggest to other people with disabilities that their own disclosure might not be welcome. More significantly, it makes it far harder to create a culture which is inclusive and accessible for everyone. 

We need to dispel some of these myths that employers have about disabled people

“If we can’t see role models at the top of an organisation talking about disability,” says Caroline Casey, founder of the Valuable 500, “then it becomes a difficult issue because we’re pleading for accommodations.” 

From remote working to ramps in the office, the factors that could improve the daily working lives of employees with disabilities are far easier to secure when business leaders see it as a priority.

Fighting stigma at the highest level 

What is driving this fear of disclosure? Many of those with disabilities worry about being viewed differently, taken less seriously or seen as less able. Some believe it will keep them from jobs or promotions or that, by asking for the accommodations they need, they will be seen as demanding or difficult. 

To tackle this fear, two things are needed, says Mark Esho founder of social enterprise The Circle Foundation. The first is representation. “If you look back 10 years, how many Black people did you see in adverts? Possibly zero. Now, we see it all the time. The only advert I’ve seen with a disabled person is the Sure one. As a society we need to bring more disabled people to the forefront.”

We can’t just have lip service. We need leadership to invest in this area and ensure there’s accountability.

The second thing that is needed, says Esho, is education, particularly among business leaders. “We need to dispel some of these myths that employers have about disabled people: that we lack education, we’re lazy, we don’t have the right skills or that once you employ a disabled person, you’ll never be able to get rid of them.” 

Better education and better support for employers will help them understand what employing someone with a disability actually entails.

How leaders can create inclusive workplaces

Leaders set the tone for the culture in an organisation meaning that, whether they have a disability or not, they are ultimately responsible for creating workplaces where all employees can thrive. Unfortunately, this is all too rare. The same EY study found that 54% of global boards have never had a conversation about disability. And although 90% of organisations say they are “passionate about inclusion”, only 4% include disability in their inclusion initiatives. 

“We can’t just have lip service,” says Casey. “We need leadership to invest in this area and ensure there’s accountability.” 

What this looks like in a practical sense is simple, she says: “Leaders need to strategically integrate disability into the business, and they need to put money and resources behind it. Then they need to talk to the people in their business who have experience with disabilities, using resources like internal employee support groups.” 

It’s not just those at the top who can drive change, says Burcu Borysik, head of policy and campaigns at Crohn’s & Colitis UK. “I absolutely agree with the importance of leaders being role models, but leadership is also dispersed,” she says. “There is power in pretty much everyone speaking up, regardless of their level or title in the organisation.” 
Setting an example at C-suite level empowers those in the rest of an organisation to come forward and speak out. And, if business leaders can create a culture of openness and inclusion, postive change will follow for everyone.



The post What business leaders can do to foster disability inclusion appeared first on Raconteur.

]]>
Wildcat strikes: what employers need to know https://www.raconteur.net/workplace/wildcat-strikes-amazon-advice-employers-industrial-action/ Tue, 23 Aug 2022 16:40:00 +0000 //www.raconteur.net/?p=157646 Demonstrators take part in a march with torches from Nation to Place de la Republique in Paris on January 23, 2020 as part of a nationwide multi-sector strike against the French government's plans to overhaul the pension system. - Hardline French unions on January 22 kept up a series of wildcat strikes aimed at ratcheting up pressure on the government before it presents the final version of a pension reform that has prompted France's biggest labour protest in decades. The government will unveil the revised pensions overhaul at a cabinet meeting on January 24 before submitting the draft law to parliament for debate set to begin on February 17. (Photo by GEOFFROY VAN DER HASSELT / AFP) (Photo by GEOFFROY VAN DER HASSELT/AFP via Getty Images)

As discontent spreads in workplaces where pay is declining in real terms, more and more employees – unionised or not – are taking unofficial industrial action. How can businesses best manage the risk?


Demonstrators in Paris protest against pension overhauls during nationwide wildcat strikes in January 2020

“There’s no respect and they work us like robots,” said an employee at Amazon UK’s Swindon warehouse, explaining his colleagues’ decision to down tools and stage a canteen sit-in on 8 August. Angered by a pay deal offering an increase of 35p per hour, among other moves by the company, workers at several of its other depots around the country soon followed suit.

What has set these disputes apart from the dozens of others that have occurred during the UK’s summer of strikes is that, unlike railway staff, dockers and refuse collectors, the Amazon workers acted without the backing of a trade union. Similar unofficial strikes have been breaking out in workplaces ranging from North Sea oil rigs to food factories.

These stoppages tend to be more spontaneous and short-lived than those organised by unions. Known as wildcat strikes in cases where a workforce is unionised but workers take action without going through the approved procedures, such acts are also illegal. Nonetheless, they can still pose serious problems for employers, damaging productivity, morale and public relations.

Compared with most other European countries, the UK has seen few wildcat strikes in recent years, but that may well change if the economy continues to falter as predicted. That’s the view of Dr Manuela Galetto, associate professor in employment relations at Warwick Business School.

“The cost-of-living crisis is ramping up and there is certainly discontent,” she says, suggesting that workers taking unofficial action – which could cost them their jobs – may feel they have less to lose, given that the recruitment market is generally weighted in their favour. Nearly half (47%) of UK employers are struggling to fill vacancies, according to the latest research by the Chartered Institute of Personnel Development (CIPD).

Another CIPD survey has found that 53% of companies think the country is entering a more unstable period of employment relations, while 42% expect to see increasing levels of industrial action over the next year. So how can employers best manage this heightened risk?



Preparing for potential strikes

Adrian Martin is a partner at law firm Burges Salmon, where he leads the employment team. His advice to employers is to “do all you can to prevent wildcat strikes from arising. Try to maintain as much engagement with your employees as possible.”

That should include being open about tough choices. For instance, if inflation-lagging pay offers are an issue, the management may need to explain how inflation is affecting the business.

“If you’re offering a certain pay increase, explain why that’s the figure you’ve chosen and why higher amounts aren’t affordable,” Martin says. “Try to use neutral, non-emotive language and perhaps give some objective examples to illustrate your points.”

Paul Atkinson, an employee relations consultant who has worked in the oil and gas sector for 30 years, advises business leaders to stay closely attuned to what’s happening on the front line. They should make regular site visits and seek supervisors’ views to anticipate any potential problems.

“Be aware of what is happening with your workforce, especially on the shop floor,” he stresses.

Making contingency plans for potential industrial action is also vital. Many companies without a history of unionisation tend to be relatively unprepared for tough negotiations with disgruntled workers. Some may not even have decided which members of the management team should take responsibility for such a task.

Atkinson believes that it should be managers on the operations side of the business rather than the HR function, as the former is closer to the heart of the enterprise – and “sometimes this is not about motherhood and apple pie”.

These managers should be trained to negotiate, he says, adding: “You should always have plans ready. Even if they go out of the window in the fog of war, at least you have a starting point.”

When wildcat strikes happen

Unionised employees in a workplace who have gone through the correct procedures and balloted successfully for a strike are granted protections under UK law. For instance, although they don’t have to be paid for any hours they refuse to work, they cannot be dismissed for withdrawing their labour.

This is not the case for non-organised industrial action. In theory, that makes it easier for employers to bring it to an end, including by terminating people’s contracts of employment. But Martin believes that such a “drastic step” is best avoided.

“Thinking about dismissal should be very much a last resort. It’s not something that should be done lightly,” he warns. “The law relating to industrial action is complicated. If you’re doing anything detrimental to an employee in some way, you’ll need to think through the potential consequences carefully.”

Thinking about dismissal should be very much a last resort. It’s not something that should be done lightly

Dismissing some striking workers but not others could lead to discrimination claims, for instance. Even threatening dismissal is risky, Martin notes, “because that will simply make matters more heated instead of helping you to find a way forward”.

Atkinson agrees, adding that employers should consider not only the operational impact of dismissing competent workers, especially when skills may be in short supply, but also how such a move would affect a firm’s reputation.

“PR-wise, it can be a disaster,” he says. “A lot of the battle these days plays out in the media.”

The widespread sharing on social media of videos shot by Amazon workers illustrates Atkinson’s point. The company was forced to apologise after a manager at the Swindon depot was caught on camera comparing staff to “animals”. Workers at other warehouses were inspired to walk out after watching footage of earlier Amazon protests on TikTok, according to socialist collective Notes from Below.

The role of trade unions

When in doubt, management should seek to involve any relevant union. Atkinson cites his experience of dealing with a wildcat stoppage involving 1,500 people on an oil rig. Although the workers’ trade union was unaware of the action at first, it moved quickly to negotiate on their behalf and resolve the dispute when it found out.

This illustrates how wildcat strikes are a risk even in workplaces with a strong union presence. Slow-moving strike ballot processes, a failure to reach a vote threshold or a sudden change in conditions can prompt rank-and-file members to take matters into their own hands.



Although many companies – including Amazon UK – have campaigned strongly against unionisation in their workplaces, Atkinson believes that unions can be helpful to employers.

“It can delay some processes, but at least there is someone experienced whom you can negotiate with if there’s industrial action, rather than people who think you’ll just roll over and give them what they want,” he says.

For her part, Galetto has observed “a bit of rhetoric around how unions can be scary, confrontational and adversarial. In my experience, they can be good allies in solving problems for the employees, especially when it comes to collective demands.”

Despite these benefits for staff and employers, union membership has been falling steadily in the UK since the 1920s. As the economy continues to struggle, more and more workers may feel that unofficial strike action is the only way to secure a pay rise that will keep pace with inflation. A return to the mass walkouts of the 1970s may be unlikely, but it’s clear that employers can no longer be complacent about the risk of industrial unrest in the workplace.



The post Wildcat strikes: what employers need to know appeared first on Raconteur.

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Demonstrators take part in a march with torches from Nation to Place de la Republique in Paris on January 23, 2020 as part of a nationwide multi-sector strike against the French government's plans to overhaul the pension system. - Hardline French unions on January 22 kept up a series of wildcat strikes aimed at ratcheting up pressure on the government before it presents the final version of a pension reform that has prompted France's biggest labour protest in decades. The government will unveil the revised pensions overhaul at a cabinet meeting on January 24 before submitting the draft law to parliament for debate set to begin on February 17. (Photo by GEOFFROY VAN DER HASSELT / AFP) (Photo by GEOFFROY VAN DER HASSELT/AFP via Getty Images)

As discontent spreads in workplaces where pay is declining in real terms, more and more employees – unionised or not – are taking unofficial industrial action. How can businesses best manage the risk?


Demonstrators in Paris protest against pension overhauls during nationwide wildcat strikes in January 2020

“There’s no respect and they work us like robots,” said an employee at Amazon UK’s Swindon warehouse, explaining his colleagues’ decision to down tools and stage a canteen sit-in on 8 August. Angered by a pay deal offering an increase of 35p per hour, among other moves by the company, workers at several of its other depots around the country soon followed suit.

What has set these disputes apart from the dozens of others that have occurred during the UK’s summer of strikes is that, unlike railway staff, dockers and refuse collectors, the Amazon workers acted without the backing of a trade union. Similar unofficial strikes have been breaking out in workplaces ranging from North Sea oil rigs to food factories.

These stoppages tend to be more spontaneous and short-lived than those organised by unions. Known as wildcat strikes in cases where a workforce is unionised but workers take action without going through the approved procedures, such acts are also illegal. Nonetheless, they can still pose serious problems for employers, damaging productivity, morale and public relations.

Compared with most other European countries, the UK has seen few wildcat strikes in recent years, but that may well change if the economy continues to falter as predicted. That’s the view of Dr Manuela Galetto, associate professor in employment relations at Warwick Business School.

“The cost-of-living crisis is ramping up and there is certainly discontent,” she says, suggesting that workers taking unofficial action – which could cost them their jobs – may feel they have less to lose, given that the recruitment market is generally weighted in their favour. Nearly half (47%) of UK employers are struggling to fill vacancies, according to the latest research by the Chartered Institute of Personnel Development (CIPD).

Another CIPD survey has found that 53% of companies think the country is entering a more unstable period of employment relations, while 42% expect to see increasing levels of industrial action over the next year. So how can employers best manage this heightened risk?

Preparing for potential strikes

Adrian Martin is a partner at law firm Burges Salmon, where he leads the employment team. His advice to employers is to “do all you can to prevent wildcat strikes from arising. Try to maintain as much engagement with your employees as possible.”

That should include being open about tough choices. For instance, if inflation-lagging pay offers are an issue, the management may need to explain how inflation is affecting the business.

“If you’re offering a certain pay increase, explain why that’s the figure you’ve chosen and why higher amounts aren’t affordable,” Martin says. “Try to use neutral, non-emotive language and perhaps give some objective examples to illustrate your points.”

Paul Atkinson, an employee relations consultant who has worked in the oil and gas sector for 30 years, advises business leaders to stay closely attuned to what’s happening on the front line. They should make regular site visits and seek supervisors’ views to anticipate any potential problems.

“Be aware of what is happening with your workforce, especially on the shop floor,” he stresses.

Making contingency plans for potential industrial action is also vital. Many companies without a history of unionisation tend to be relatively unprepared for tough negotiations with disgruntled workers. Some may not even have decided which members of the management team should take responsibility for such a task.

Atkinson believes that it should be managers on the operations side of the business rather than the HR function, as the former is closer to the heart of the enterprise – and “sometimes this is not about motherhood and apple pie”.

These managers should be trained to negotiate, he says, adding: “You should always have plans ready. Even if they go out of the window in the fog of war, at least you have a starting point.”

When wildcat strikes happen

Unionised employees in a workplace who have gone through the correct procedures and balloted successfully for a strike are granted protections under UK law. For instance, although they don’t have to be paid for any hours they refuse to work, they cannot be dismissed for withdrawing their labour.

This is not the case for non-organised industrial action. In theory, that makes it easier for employers to bring it to an end, including by terminating people’s contracts of employment. But Martin believes that such a “drastic step” is best avoided.

“Thinking about dismissal should be very much a last resort. It’s not something that should be done lightly,” he warns. “The law relating to industrial action is complicated. If you’re doing anything detrimental to an employee in some way, you’ll need to think through the potential consequences carefully.”

Thinking about dismissal should be very much a last resort. It’s not something that should be done lightly

Dismissing some striking workers but not others could lead to discrimination claims, for instance. Even threatening dismissal is risky, Martin notes, “because that will simply make matters more heated instead of helping you to find a way forward”.

Atkinson agrees, adding that employers should consider not only the operational impact of dismissing competent workers, especially when skills may be in short supply, but also how such a move would affect a firm’s reputation.

“PR-wise, it can be a disaster,” he says. “A lot of the battle these days plays out in the media.”

The widespread sharing on social media of videos shot by Amazon workers illustrates Atkinson’s point. The company was forced to apologise after a manager at the Swindon depot was caught on camera comparing staff to “animals”. Workers at other warehouses were inspired to walk out after watching footage of earlier Amazon protests on TikTok, according to socialist collective Notes from Below.

The role of trade unions

When in doubt, management should seek to involve any relevant union. Atkinson cites his experience of dealing with a wildcat stoppage involving 1,500 people on an oil rig. Although the workers’ trade union was unaware of the action at first, it moved quickly to negotiate on their behalf and resolve the dispute when it found out.

This illustrates how wildcat strikes are a risk even in workplaces with a strong union presence. Slow-moving strike ballot processes, a failure to reach a vote threshold or a sudden change in conditions can prompt rank-and-file members to take matters into their own hands.

Although many companies – including Amazon UK – have campaigned strongly against unionisation in their workplaces, Atkinson believes that unions can be helpful to employers.

“It can delay some processes, but at least there is someone experienced whom you can negotiate with if there’s industrial action, rather than people who think you’ll just roll over and give them what they want,” he says.

For her part, Galetto has observed “a bit of rhetoric around how unions can be scary, confrontational and adversarial. In my experience, they can be good allies in solving problems for the employees, especially when it comes to collective demands.”

Despite these benefits for staff and employers, union membership has been falling steadily in the UK since the 1920s. As the economy continues to struggle, more and more workers may feel that unofficial strike action is the only way to secure a pay rise that will keep pace with inflation. A return to the mass walkouts of the 1970s may be unlikely, but it’s clear that employers can no longer be complacent about the risk of industrial unrest in the workplace.



The post Wildcat strikes: what employers need to know appeared first on Raconteur.

]]>
Is Westminster’s ultrafast broadband roll-out about to hit a speed bump? https://www.raconteur.net/technology/ultrafast-broadband-roll-out-hit-speed-bump/ Tue, 23 Aug 2022 10:55:00 +0000 //www.raconteur.net/?p=157855

The government wants to provide universal access to ultrafast broadband by 2030. The installation of fibreoptic networks has progressed well lately, but the hardest yards are yet to come 


If the government is ever to achieve its much-trumpeted goal of “levelling up” the UK economy, the whole country will need reliable ultrafast internet connectivity. This is why Westminster is keen to roll out gigabit-capable broadband nationwide before the end of the decade. 

The aim is to enable businesses to compete on the same technological playing field, whether they’re in a bustling city centre or a remote rural outpost. A fully fibreoptic cable network known as fibre to the premises/home (FTTP/H) is the way to achieve ultrafast download speeds in the region of a gigabit per second. To give some perspective, 1Gbps is roughly 17 times faster than the average domestic superfast connection – about 60Mbps – which often uses copper cable over the last metres between a distribution point on the street and the premises in a less efficient set-up known as fibre to the cabinet.

The government’s intermediate target is to provide at least 85% of the nation’s premises with gigabit connectivity by 2025. The pace of the full-fibre roll-out so far suggests that this is in reach. As of 7 July, 69.2% of homes in the UK were gigabit-capable, compared with 42.2% the previous July and only 22.6% the year before, according to comparison site thinkbroadband.com.

Kester Mann is director of consumer and connectivity at research and advisory company CCS Insight. He notes that the roll-out’s rapid progress over the past two years has been aided by “long-overdue investment” from BT subsidiary Openreach – the sector’s dominant player – and the arrival of dozens of alternative network providers, known in the sector as altnets. 

“Many of these have backing from wealthy investors,” he adds. “It’s a far cry from years of non-commitment and inactivity.”

Despite the encouraging signs, full-fibre deployments in most other European countries are further advanced. The latest data from industry body FTTH Council Europe shows that, as of September 2021, Iceland, Spain and Sweden were leading the way, while only Austria, Belgium, Germany and Greece had a lower full-fibre penetration than the UK. 

Openreach’s CEO, Clive Selley, told the Financial Times in June that Brexit was making it harder for his company to hire skilled workers from the EU and thereby “constraining the rate of fibre build” in the UK.

These labour shortages, combined with energy price inflation, rising interest rates, and supply chain disruption, are threatening to dampen some of the recent momentum, according to Mann. 

It’s clear that more will need to be done to support the roll-out, especially in rural areas, if the government wants to prevent its 2030 target from becoming nothing more than an ultrafast pipe dream.

There isn’t a level playing field when it comes to securing private and public funding to build fibre networks

Matt Rees is chief network officer at altnet Neos Networks, which provides telecoms services to the public and private sectors. He observes that “it is, of course, more economically viable for new fibre to be laid in dense urban areas – which has been the focus of early deployments. But that leaves ‘notspots’ in more rural areas, creating bigger disparities across the country.”

One of the big challenges of building rural networks is dealing with wayleaves. These are contractual agreements between telcos and land owners granting the former legal access to private property so that they can build and maintain equipment. Securing one can take several months to a couple of years. If a wayleave cannot be agreed, the telco may have to reroute its planned network. 

The industry is asking the government for more help with wayleaves as part of the Project Gigabit, the latter’s £5bn programme to level up the 20% hardest-to-reach premises in rural areas. 

Westminster has committed less than a quarter of the pledged funding so far, according to Mikael Sandberg, executive chairman at VX Fiber, a Swedish FTTP network provider. This slow disbursement, he says, “has left industry players concerned that the 85% target remains challenging”.

Rees adds that other elements of the government’s plan leave much to be desired. “The strategy is great in principle, but in reality there isn’t a level playing field when it comes to securing private and public funding to build fibre networks,” he says. 

This has tended to put altnets at a disadvantage. For instance, Openreach has hiked the prices they must pay to use its ethernet products to feed their FTTP broadband to customers. 

To complicate matters, towards the end of 2021 Ofcom approved Openreach’s so-called Equinox offer to cut the price of its FTTP network for internet service providers in return for their long-term commitment to using it. This prompted immediate protests from altnets that had been pumping billions into rival FTTP networks – most notably, CityFibre. 

The concern is that the Equinox pricing scheme could weaken full-fibre competition and infrastructure deployment and innovation by undercutting altnets’ prices and locking internet service providers into lengthy contracts. If altnets struggle to attract customers as a result, it could drive some out of business.

Equinox has been described by analysts at Barclays as a “land grab” that weakens the business case for altnets. The Independent Networks Cooperative Association has predicted that altnets will cover nearly 30 million British homes by 2025, but that forecast has started to look over-optimistic. 

What’s more, where altnets do deploy their networks, there’s a real possibility that Openreach could simply build over them. 

“Multiple providers laying fibre in the same area, all targeting the same households, is an inefficient, costly scenario,” Mann says. “That would do little to assist the government’s plans to bring more people online and narrow the digital divide.”

The race to be the first to lay fibre in an area risks fragmenting the market, he warns. It means that some altnets are destined for commercial failure. For many of the smaller players, then, joining forces may be the only way to survive.

Ultimately, Openreach’s Equinox gambit and overbuilding could result in full-fibre infrastructure losing its value altogether. 

As Rees observes: “Levelling up is required in the supply chain too.”



The post Is Westminster’s ultrafast broadband roll-out about to hit a speed bump? appeared first on Raconteur.

]]>

The government wants to provide universal access to ultrafast broadband by 2030. The installation of fibreoptic networks has progressed well lately, but the hardest yards are yet to come 


If the government is ever to achieve its much-trumpeted goal of “levelling up” the UK economy, the whole country will need reliable ultrafast internet connectivity. This is why Westminster is keen to roll out gigabit-capable broadband nationwide before the end of the decade. 

The aim is to enable businesses to compete on the same technological playing field, whether they’re in a bustling city centre or a remote rural outpost. A fully fibreoptic cable network known as fibre to the premises/home (FTTP/H) is the way to achieve ultrafast download speeds in the region of a gigabit per second. To give some perspective, 1Gbps is roughly 17 times faster than the average domestic superfast connection – about 60Mbps – which often uses copper cable over the last metres between a distribution point on the street and the premises in a less efficient set-up known as fibre to the cabinet.

The government’s intermediate target is to provide at least 85% of the nation’s premises with gigabit connectivity by 2025. The pace of the full-fibre roll-out so far suggests that this is in reach. As of 7 July, 69.2% of homes in the UK were gigabit-capable, compared with 42.2% the previous July and only 22.6% the year before, according to comparison site thinkbroadband.com.

Kester Mann is director of consumer and connectivity at research and advisory company CCS Insight. He notes that the roll-out’s rapid progress over the past two years has been aided by “long-overdue investment” from BT subsidiary Openreach – the sector’s dominant player – and the arrival of dozens of alternative network providers, known in the sector as altnets. 

“Many of these have backing from wealthy investors,” he adds. “It’s a far cry from years of non-commitment and inactivity.”

Despite the encouraging signs, full-fibre deployments in most other European countries are further advanced. The latest data from industry body FTTH Council Europe shows that, as of September 2021, Iceland, Spain and Sweden were leading the way, while only Austria, Belgium, Germany and Greece had a lower full-fibre penetration than the UK. 

Openreach’s CEO, Clive Selley, told the Financial Times in June that Brexit was making it harder for his company to hire skilled workers from the EU and thereby “constraining the rate of fibre build” in the UK.

These labour shortages, combined with energy price inflation, rising interest rates, and supply chain disruption, are threatening to dampen some of the recent momentum, according to Mann. 

It’s clear that more will need to be done to support the roll-out, especially in rural areas, if the government wants to prevent its 2030 target from becoming nothing more than an ultrafast pipe dream.

There isn’t a level playing field when it comes to securing private and public funding to build fibre networks

Matt Rees is chief network officer at altnet Neos Networks, which provides telecoms services to the public and private sectors. He observes that “it is, of course, more economically viable for new fibre to be laid in dense urban areas – which has been the focus of early deployments. But that leaves ‘notspots’ in more rural areas, creating bigger disparities across the country.”

One of the big challenges of building rural networks is dealing with wayleaves. These are contractual agreements between telcos and land owners granting the former legal access to private property so that they can build and maintain equipment. Securing one can take several months to a couple of years. If a wayleave cannot be agreed, the telco may have to reroute its planned network. 

The industry is asking the government for more help with wayleaves as part of the Project Gigabit, the latter’s £5bn programme to level up the 20% hardest-to-reach premises in rural areas. 

Westminster has committed less than a quarter of the pledged funding so far, according to Mikael Sandberg, executive chairman at VX Fiber, a Swedish FTTP network provider. This slow disbursement, he says, “has left industry players concerned that the 85% target remains challenging”.

Rees adds that other elements of the government’s plan leave much to be desired. “The strategy is great in principle, but in reality there isn’t a level playing field when it comes to securing private and public funding to build fibre networks,” he says. 

This has tended to put altnets at a disadvantage. For instance, Openreach has hiked the prices they must pay to use its ethernet products to feed their FTTP broadband to customers. 

To complicate matters, towards the end of 2021 Ofcom approved Openreach’s so-called Equinox offer to cut the price of its FTTP network for internet service providers in return for their long-term commitment to using it. This prompted immediate protests from altnets that had been pumping billions into rival FTTP networks – most notably, CityFibre. 

The concern is that the Equinox pricing scheme could weaken full-fibre competition and infrastructure deployment and innovation by undercutting altnets’ prices and locking internet service providers into lengthy contracts. If altnets struggle to attract customers as a result, it could drive some out of business.

Equinox has been described by analysts at Barclays as a “land grab” that weakens the business case for altnets. The Independent Networks Cooperative Association has predicted that altnets will cover nearly 30 million British homes by 2025, but that forecast has started to look over-optimistic. 

What’s more, where altnets do deploy their networks, there’s a real possibility that Openreach could simply build over them. 

“Multiple providers laying fibre in the same area, all targeting the same households, is an inefficient, costly scenario,” Mann says. “That would do little to assist the government’s plans to bring more people online and narrow the digital divide.”

The race to be the first to lay fibre in an area risks fragmenting the market, he warns. It means that some altnets are destined for commercial failure. For many of the smaller players, then, joining forces may be the only way to survive.

Ultimately, Openreach’s Equinox gambit and overbuilding could result in full-fibre infrastructure losing its value altogether. 

As Rees observes: “Levelling up is required in the supply chain too.”



The post Is Westminster’s ultrafast broadband roll-out about to hit a speed bump? appeared first on Raconteur.

]]>
How to design smart cities that enable urban populations to thrive https://www.raconteur.net/urbanisation/how-to-design-smart-cities-that-enable-urban-populations-to-thrive/ Mon, 22 Aug 2022 11:19:15 +0000 //www.raconteur.net/?p=157755 Lit city road junction at night

A more sustainable and intersectional approach to smart city design is fundamental to improving the quality of life for all citizens


Technology is rapidly transforming the way our cities operate and how we live within them, with increasingly sophisticated machines and algorithms adding layers of intelligence once only thought possible in science fiction.

But smart cities are not about innovating for the sake of innovation. They are about providing solutions to some of our biggest issues in society, from public health, safety and wellbeing to sustainability, biodiversity and social equity. Fundamentally, they are about improving the quality of life for all citizens and societies as a whole.

With almost 70% of the global population expected to live in urban areas by 2050 and living for longer, smart cities must be designed to be inclusive, accessible and resilient to the myriad challenges our planet faces.

Technology has an instrumental role to play but a whole-system approach that also takes into account the built environment, natural world and the diversity of city dwellers is needed for people, cities and societies to thrive.

Faced with a potentially turbulent future, urban planners are increasingly advocating a more sustainable approach.

“That means the planning of housing, employment and services addresses the need for net-zero development and resilience to climate change, while delivering quality places and green spaces, community infrastructure and job opportunities where people live,” says Edinburgh City Council’s head of placemaking and mobility, Daisy Narayanan.

This is the cornerstone of the 20-minute neighbourhood and 15-minute city approaches, which are becoming a key focus area for governments, organisations and communities across the world. The concept is that everyone can meet most of their daily needs within a short walk, wheel or cycle from their home.

 “We need this level of ambition to achieve a significant shift away from longer journeys to active travel and meet our net-zero carbon target by 2030,” says Narayanan. “But it is also about creating more social, inclusive and accessible places by improving access to quality services and empowering local communities.”

Can smart cities address the cost-of-living crisis?

Amid the global cost of living crisis and likely post-Covid recession, the affordability of cities has become paramount to their liveability. The latest global Smart Cities Index cites access to affordable housing as the most urgent matter for cities worldwide, with citizens ranking it above unemployment, public transport and pollution.

Active Building Centre increasingly works with social housing providers to help them design buildings that create ‘energy-positive’ communities. Its CEO, Dan Cook, thinks a wide range of housing types is “fundamental for all the critical people you need to make a city function”. 

Through the intelligent integration of different renewable energy technologies, ‘active buildings’ can generate and store renewable electricity to meet their own needs and redistribute the surplus to other buildings and back into the grid. Their ability to reduce energy consumption and lower fuel bills, while supporting people to have more control of their energy supply, is a tangible solution to reducing cost-of-living pressures and improving affordability in the longer term. 

Many of these technologies already exist. Cook says the onus is on local governments and the building sector to make them mainstream and ensure that supply chains are in place to scale up.

With urbanisation increasing the diversity of city populations and adding new complexities, smart cities need to be designed responsibly to avoid embedding existing inequalities and widening divides.

Dr Jo Morrison is director of research and innovation at digital agency Calvium. She thinks that a truly accessible and inclusive smart city is one that “embraces a thoughtful, ethical and intersectional approach across the system”.

“We can’t create accessible smart cities just by rolling out the tech. We have to get to grips with the city as a whole – for example, its existing structures of discrimination,” she says, emphasising the importance of building smart systems on “responsible data inputs” that minimise the risk of causing harm to citizens.

Creating more inclusive urban areas

While key factors such as race, age and gender must be considered, the design process must also seek to engage and empower difficult-to-reach population groups such as disabled people, migrants and people experiencing poverty and social exclusion.

Citizens’ Assemblies are integral to the democratic development of smart city solutions, ensuring a wide range of viewpoints in the decision-making process. When Berlin recently launched the selection process for its first Citizens’ Assembly for climate change, it used an algorithm to choose 100 citizens at random based on criteria including age, gender, education and migration experience to ensure the committee mirrored the city’s population as closely as possible.

Working with communities to help shape proposals through a robust engagement process is “absolutely key” to improving the lives of all citizens, says Narayanan, with technology such as virtual reality playing a significant role in allowing communities to experience what enhanced areas might look like. 

“Building these stronger relationships to support local economies and target resources where they’re needed should empower communities, helping them to create their own solutions for the delivery of the services they need and promote community wealth building,” says Narayanan. 

“This will help to build a longer-term, self-sustaining legacy to ensure the right principles continue at the core of local development for future generations.”

Ultimately, for smart cities to unlock their potential to create more inclusive, equitable and enjoyable places for people to live, they must be built on foundations that place the needs of their citizens above everything else.



The post How to design smart cities that enable urban populations to thrive appeared first on Raconteur.

]]>
Lit city road junction at night

A more sustainable and intersectional approach to smart city design is fundamental to improving the quality of life for all citizens


Technology is rapidly transforming the way our cities operate and how we live within them, with increasingly sophisticated machines and algorithms adding layers of intelligence once only thought possible in science fiction.

But smart cities are not about innovating for the sake of innovation. They are about providing solutions to some of our biggest issues in society, from public health, safety and wellbeing to sustainability, biodiversity and social equity. Fundamentally, they are about improving the quality of life for all citizens and societies as a whole.

With almost 70% of the global population expected to live in urban areas by 2050 and living for longer, smart cities must be designed to be inclusive, accessible and resilient to the myriad challenges our planet faces.

Technology has an instrumental role to play but a whole-system approach that also takes into account the built environment, natural world and the diversity of city dwellers is needed for people, cities and societies to thrive.

Faced with a potentially turbulent future, urban planners are increasingly advocating a more sustainable approach.

“That means the planning of housing, employment and services addresses the need for net-zero development and resilience to climate change, while delivering quality places and green spaces, community infrastructure and job opportunities where people live,” says Edinburgh City Council’s head of placemaking and mobility, Daisy Narayanan.

This is the cornerstone of the 20-minute neighbourhood and 15-minute city approaches, which are becoming a key focus area for governments, organisations and communities across the world. The concept is that everyone can meet most of their daily needs within a short walk, wheel or cycle from their home.

 “We need this level of ambition to achieve a significant shift away from longer journeys to active travel and meet our net-zero carbon target by 2030,” says Narayanan. “But it is also about creating more social, inclusive and accessible places by improving access to quality services and empowering local communities.”

Can smart cities address the cost-of-living crisis?

Amid the global cost of living crisis and likely post-Covid recession, the affordability of cities has become paramount to their liveability. The latest global Smart Cities Index cites access to affordable housing as the most urgent matter for cities worldwide, with citizens ranking it above unemployment, public transport and pollution.

Active Building Centre increasingly works with social housing providers to help them design buildings that create ‘energy-positive’ communities. Its CEO, Dan Cook, thinks a wide range of housing types is “fundamental for all the critical people you need to make a city function”. 

Through the intelligent integration of different renewable energy technologies, ‘active buildings’ can generate and store renewable electricity to meet their own needs and redistribute the surplus to other buildings and back into the grid. Their ability to reduce energy consumption and lower fuel bills, while supporting people to have more control of their energy supply, is a tangible solution to reducing cost-of-living pressures and improving affordability in the longer term. 

Many of these technologies already exist. Cook says the onus is on local governments and the building sector to make them mainstream and ensure that supply chains are in place to scale up.

With urbanisation increasing the diversity of city populations and adding new complexities, smart cities need to be designed responsibly to avoid embedding existing inequalities and widening divides.

Dr Jo Morrison is director of research and innovation at digital agency Calvium. She thinks that a truly accessible and inclusive smart city is one that “embraces a thoughtful, ethical and intersectional approach across the system”.

“We can’t create accessible smart cities just by rolling out the tech. We have to get to grips with the city as a whole – for example, its existing structures of discrimination,” she says, emphasising the importance of building smart systems on “responsible data inputs” that minimise the risk of causing harm to citizens.

Creating more inclusive urban areas

While key factors such as race, age and gender must be considered, the design process must also seek to engage and empower difficult-to-reach population groups such as disabled people, migrants and people experiencing poverty and social exclusion.

Citizens’ Assemblies are integral to the democratic development of smart city solutions, ensuring a wide range of viewpoints in the decision-making process. When Berlin recently launched the selection process for its first Citizens’ Assembly for climate change, it used an algorithm to choose 100 citizens at random based on criteria including age, gender, education and migration experience to ensure the committee mirrored the city’s population as closely as possible.

Working with communities to help shape proposals through a robust engagement process is “absolutely key” to improving the lives of all citizens, says Narayanan, with technology such as virtual reality playing a significant role in allowing communities to experience what enhanced areas might look like. 

“Building these stronger relationships to support local economies and target resources where they’re needed should empower communities, helping them to create their own solutions for the delivery of the services they need and promote community wealth building,” says Narayanan. 

“This will help to build a longer-term, self-sustaining legacy to ensure the right principles continue at the core of local development for future generations.”

Ultimately, for smart cities to unlock their potential to create more inclusive, equitable and enjoyable places for people to live, they must be built on foundations that place the needs of their citizens above everything else.



The post How to design smart cities that enable urban populations to thrive appeared first on Raconteur.

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How LinkedIn’s fertility benefits became a ‘USP for talent attraction’ https://www.raconteur.net/against-the-grain/how-linkedins-fertility-benefits-became-a-usp-for-talent-attraction/ Mon, 22 Aug 2022 09:39:40 +0000 //www.raconteur.net/?p=157676 LinkedIn fertility benefits

LinkedIn is one of the first large companies to have offered fertility benefits to UK employees. Its senior director of compensation and benefits explains the advantages the policy has brought


This article is part of our Going Against the Grain series, which tells the stories of companies bold enough to break business norms and try out new ideas. To explore the rest of the series, head here.

The number of employers offering their staff family-building benefits, including assistance with fertility, adoption or fostering, is on the rise.

Fertility advice provider FertilityIQ estimates that 800 large organisations around the world offer such benefits – a 59% increase on 2019’s total.

These can be costly for employers to implement, compared with standard offerings such as gym memberships. The average family-building support package offered by US firms last year was worth $36,000 (£30,000), with some companies offering up to $80,000.

But it has been a worthwhile investment for LinkedIn, which introduced its fertility package for UK staff in 2019. The company reports that this has improved employee wellbeing, cultural cohesion and its power to attract and retain talent.

LinkedIn started offering the benefits in light of a survey of 5,000 workers and HR professionals in the UK. One of the key findings was that workplace policies were failing to meet the needs of employees, particularly those seeking to start a family. 

Katherine Gilbert is LinkedIn’s senior director of compensation and benefits in EMEA and Latin America. She explains that the company “wanted to build an environment of support for everyone in our workforce and implement the appropriate policies to help employees on their fertility journeys”.

Gilbert adds: “When new employees join LinkedIn and learn about the fertility benefit during induction, it’s a ‘wow’ moment for them. The feedback we’ve received has been, and continues to be, incredible.”

What support do employees receive?

Through LinkedIn’s fertility and adoption assistance programme, employees in the UK can claim back money they spend during the adoption process or put towards fertility treatments, with a maximum claim of £7,000 per cycle and a lifetime limit of £21,000.

The company also offers them access to a 24/7 confidential counselling service, webinars and a database of family services.

Employers planning to introduce similar benefits need to consider the comprehensiveness of the help they intend to offer would-be parents, according to Gilbert.

“Employees need to be supported by their managers throughout this process, so we give our managers guidance on how to be flexible on working hours to allow for time spent on appointments, for example,” she says.

Gilbert believes that the policy has had a noticeable positive impact on her organisation’s culture. “We understand that family comes first and we want to help employees on their journey. The emotional wellbeing of our team is a top priority for us,” she says. “This benefit is an example of the inclusive and supportive culture at LinkedIn, which is our USP for talent attraction and retention.”

Normalising discussions about fertility in the workplace

Introducing fertility and adoption assistance has also helped to encourage more open discussions about what can often be a sensitive and highly emotive subject, especially for those who desperately want to start a family and have been struggling to do so for some time.

“By offering such a benefit, we are acknowledging the reality for many is that the path to starting a family is not always straightforward,” Gilbert says. “This provides a space for people to open up if they want to. We know we can’t take away every part of the stress of fertility treatment, but we can show that we’re there to support colleagues.”

There are few barriers for staff who want to use the assistance programme. The only requirement is that the applicant must be an “active employee” when they and their partner incur the costs eligible for reimbursement.

Obviously, not everyone at the company will use the benefit, but all staff “can see how impactful it would be. Many employees will have friends or relatives who’ve experienced challenges in starting a family,” Gilbert notes.

Advice for companies introducing a fertility benefit

She reports that LinkedIn didn’t run into any serious problems when implementing the assistance scheme, although the scale of the roll-out across the many territories in which the firm operates warranted more planning than smaller businesses might need to do.

Her advice to companies thinking about introducing similar schemes would be to first ensure that the workplace culture is supportive enough for people to feel they can talk to their managers and HR teams about any fertility struggles they may be having. Then it’s a case of ensuring that everyone knows how to access the relevant services.

Gilbert says: “The decision whether or not to have children is an intensely personal one, but employees need to know that they will not be disadvantaged in their careers by talking openly about their hopes for a family. That will ease the worry that many people – especially women – in this position will experience.” 

The decision whether or not to have children is an intensely personal one, but employees need to know that they will not be disadvantaged in their careers by talking openly about their hopes for a family

Employers must also understand that undergoing fertility treatment or the adoption process can be a complex and stressful experience. Gilbert advises that managers should be made aware that in-vitro fertilisation (IVF) cycles may require irregular working patterns, so there may be occasions where they need to help affected employees handle their workloads through such periods.

At such times, it’s important to ensure that the individuals concerned feel valued, supported and secure, whatever the result. 

“If the treatment is unsuccessful, the employee may need time to recover and their situation needs to be handled sensitively, as a failure will naturally be a huge disappointment,” she stresses.

Although there has been an increase in the number of companies offering employees financial support for surrogacy, adoption and IVF treatment, Gilbert believes that “more needs to be done to protect those undergoing fertility-related challenges”.

Apple, Centrica, Facebook, Hootsuite, NatWest and Salesforce are among some of the other companies to offer fertility benefits. These range from egg-freezing to support for same-sex couples planning to start families.

As more businesses follow suit and conversations about the subject become normalised in the workplace, fertility support may in time become as common as dental insurance or gym membership on the list of corporate perks.



The post How LinkedIn’s fertility benefits became a ‘USP for talent attraction’ appeared first on Raconteur.

]]>
LinkedIn fertility benefits

LinkedIn is one of the first large companies to have offered fertility benefits to UK employees. Its senior director of compensation and benefits explains the advantages the policy has brought


This article is part of our Going Against the Grain series, which tells the stories of companies bold enough to break business norms and try out new ideas. To explore the rest of the series, head here.

The number of employers offering their staff family-building benefits, including assistance with fertility, adoption or fostering, is on the rise.

Fertility advice provider FertilityIQ estimates that 800 large organisations around the world offer such benefits – a 59% increase on 2019’s total.

These can be costly for employers to implement, compared with standard offerings such as gym memberships. The average family-building support package offered by US firms last year was worth $36,000 (£30,000), with some companies offering up to $80,000.

But it has been a worthwhile investment for LinkedIn, which introduced its fertility package for UK staff in 2019. The company reports that this has improved employee wellbeing, cultural cohesion and its power to attract and retain talent.

LinkedIn started offering the benefits in light of a survey of 5,000 workers and HR professionals in the UK. One of the key findings was that workplace policies were failing to meet the needs of employees, particularly those seeking to start a family. 

Katherine Gilbert is LinkedIn’s senior director of compensation and benefits in EMEA and Latin America. She explains that the company “wanted to build an environment of support for everyone in our workforce and implement the appropriate policies to help employees on their fertility journeys”.

Gilbert adds: “When new employees join LinkedIn and learn about the fertility benefit during induction, it’s a ‘wow’ moment for them. The feedback we’ve received has been, and continues to be, incredible.”

What support do employees receive?

Through LinkedIn’s fertility and adoption assistance programme, employees in the UK can claim back money they spend during the adoption process or put towards fertility treatments, with a maximum claim of £7,000 per cycle and a lifetime limit of £21,000.

The company also offers them access to a 24/7 confidential counselling service, webinars and a database of family services.

Employers planning to introduce similar benefits need to consider the comprehensiveness of the help they intend to offer would-be parents, according to Gilbert.

“Employees need to be supported by their managers throughout this process, so we give our managers guidance on how to be flexible on working hours to allow for time spent on appointments, for example,” she says.

Gilbert believes that the policy has had a noticeable positive impact on her organisation’s culture. “We understand that family comes first and we want to help employees on their journey. The emotional wellbeing of our team is a top priority for us,” she says. “This benefit is an example of the inclusive and supportive culture at LinkedIn, which is our USP for talent attraction and retention.”

Normalising discussions about fertility in the workplace

Introducing fertility and adoption assistance has also helped to encourage more open discussions about what can often be a sensitive and highly emotive subject, especially for those who desperately want to start a family and have been struggling to do so for some time.

“By offering such a benefit, we are acknowledging the reality for many is that the path to starting a family is not always straightforward,” Gilbert says. “This provides a space for people to open up if they want to. We know we can’t take away every part of the stress of fertility treatment, but we can show that we’re there to support colleagues.”

There are few barriers for staff who want to use the assistance programme. The only requirement is that the applicant must be an “active employee” when they and their partner incur the costs eligible for reimbursement.

Obviously, not everyone at the company will use the benefit, but all staff “can see how impactful it would be. Many employees will have friends or relatives who’ve experienced challenges in starting a family,” Gilbert notes.

Advice for companies introducing a fertility benefit

She reports that LinkedIn didn’t run into any serious problems when implementing the assistance scheme, although the scale of the roll-out across the many territories in which the firm operates warranted more planning than smaller businesses might need to do.

Her advice to companies thinking about introducing similar schemes would be to first ensure that the workplace culture is supportive enough for people to feel they can talk to their managers and HR teams about any fertility struggles they may be having. Then it’s a case of ensuring that everyone knows how to access the relevant services.

Gilbert says: “The decision whether or not to have children is an intensely personal one, but employees need to know that they will not be disadvantaged in their careers by talking openly about their hopes for a family. That will ease the worry that many people – especially women – in this position will experience.” 

The decision whether or not to have children is an intensely personal one, but employees need to know that they will not be disadvantaged in their careers by talking openly about their hopes for a family

Employers must also understand that undergoing fertility treatment or the adoption process can be a complex and stressful experience. Gilbert advises that managers should be made aware that in-vitro fertilisation (IVF) cycles may require irregular working patterns, so there may be occasions where they need to help affected employees handle their workloads through such periods.

At such times, it’s important to ensure that the individuals concerned feel valued, supported and secure, whatever the result. 

“If the treatment is unsuccessful, the employee may need time to recover and their situation needs to be handled sensitively, as a failure will naturally be a huge disappointment,” she stresses.

Although there has been an increase in the number of companies offering employees financial support for surrogacy, adoption and IVF treatment, Gilbert believes that “more needs to be done to protect those undergoing fertility-related challenges”.

Apple, Centrica, Facebook, Hootsuite, NatWest and Salesforce are among some of the other companies to offer fertility benefits. These range from egg-freezing to support for same-sex couples planning to start families.

As more businesses follow suit and conversations about the subject become normalised in the workplace, fertility support may in time become as common as dental insurance or gym membership on the list of corporate perks.



The post How LinkedIn’s fertility benefits became a ‘USP for talent attraction’ appeared first on Raconteur.

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Could mandatory disability workforce reporting help to tackle pay disparity? https://www.raconteur.net/hr/diversity-inclusion/mandatory-disability-reporting/ Fri, 19 Aug 2022 17:52:00 +0000 //www.raconteur.net/?p=157680 Employee in a wheelchair discusses ideas with colleagues in the office

Listed firms in the UK are already obliged to disclose their gender pay gaps, but the government is proposing to extend this requirement to cover disabled and non-disabled staff


A disabled person working in the UK was paid 13.8% less on average than their non-disabled counterpart last year, according to the Office for National Statistics (ONS).

Given that this country is home to 14.6 million disabled people – of whom roughly a third are in work – it’s clear that disability discrimination in employment remains a significant problem. Yet, while there have been concerted efforts to close the gender pay gap, the difference in remuneration between disabled and non-disabled employees has tended to go under the radar.

Caroline Casey is the founder of The Valuable 500, a coalition of CEOs who have pledged to improve disability inclusion. She says: “For far too long, disability has been invisible in comparison with other minority concerns. Over and over again, the statistics show how disabled workers are consistently being overlooked and underserved.”

In an attempt to address this problem, the government has held a consultation to collect views on voluntary and mandatory disability workforce reporting. Its full findings were scheduled to be published in June, but the results have yet to be formally announced. 

Speaking before the consultation began in December 2021, the minister for disabled people, health and work, Chloe Smith, outlined the government’s aims. “We want to support employers to have the right information, so they can take the steps needed to make their organisations inclusive for all,” she said.

Despite Westminster’s belief that greater transparency could help to reduce the disability pay gap, views among employers and disabled people are mixed when it comes to whether mandatory disclosures would have the desired impact.

Casey says: “Reporting is not a magic wand. It would catch only the number of disabled people who are employed, not those who may have lost employment or be looking for work.”

Issues concerning reporting and individual identity further complicate matters. More than half of employers (52%) have reported problems collecting data on disability. The fact that 80% of disabilities are invisible – and that many disabled people choose to hide their condition – is one reason for this.

“There is also a lack of consensus worldwide regarding the definition of disability,” Casey notes. “But we shouldn’t underestimate the need for employees to self-identify without fear of negative repercussions, of course.”

Holding companies accountable

Other experts are more confident about the likely effectiveness of compulsory disclosures. Steve Ingham, CEO of PageGroup, is a wheelchair user and an advocate for mandatory reporting on disability. He believes that it would “ensure inclusion of people with disabilities in the workplace”. 

Ingham adds: “The only way to drive change is to hold companies accountable. Measurement is crucial when it comes to closing the gap, but this will provide truthful data and actionable insights only once the work environment feels inclusive and employees are comfortable expressing their disability.”

Acknowledging that reporting is not the only solution, Ingham observes that the transparency and open culture at PageGroup has helped to empower more of its employees to talk about their disabilities at work.

The Chartered Institute of Personnel and Development supports the proposed move towards compulsory disclosures as part of the wider need to “drive genuine change” in how employers treat disabled people. 

But its senior policy adviser on resourcing and inclusion, Claire McCartney, warns that employers must be prepared to report effectively. The risk is that it becomes a mere compliance exercise.

She says: “We’re concerned that a mandatory approach could encourage organisations to adopt a superficial tick-box attitude rather than developing practices that lead to lasting improvements. Many organisations lack the systems and infrastructure to collect data effectively on disability and long-term health conditions. Such data is meaningful only if it is understood and acted upon to inform real, sustainable change.”

Such criticism could be levelled at the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. Despite having submitted mandatory reports for five years, many businesses have made little progress in closing their gender pay gaps. In some cases, these have even widened.

“Gender and racial inequalities remain rife in the workplace, despite the introduction of reporting,” Casey says. “Enforcement bodies simply don’t have enough resources. Consequently, many firms do not report. We need to get to the root of the problem to build better and faster.”

How can businesses close the disability pay gap?

One of the challenges for employers is to find a reporting method that accounts for the wide range of disabled experiences and identities. One of the issues arising from the government’s consultation is the fact that mandatory reporting would require ministers to decide on a definition of disability and the categorisations of types of disabilities and conditions.

This is particularly pertinent given that the disability pay gap varies depending on the type of disability and the number of conditions an individual may have.

Xavier Langlois is chief legal and impact officer at Beamery, a talent management platform. He says: “For the employer, the challenge will be to report in a consistent, anonymised way and remain mindful that data-capture requests could cause disclosure issues for those employees who aren’t comfortable that their employer has access to their sensitive information.”

Some respondents to the consultation have also expressed concern that making such measurements mandatory could contribute to “the impression that disability is ‘hard work’ and a ‘hassle’”. 

McCartney says: “For real progress to be made, employers must take a systemic approach to ensure that their organisations are inclusive to disabled people and those with long-term health conditions. That involves looking critically at how they operate, from their processes and procedures to their culture and people management practices.”

Although the preliminary results from the consultation suggest that there’s little evidence to support a mandatory approach to disability workforce reporting. Langlois believes that such a measure could draw more attention to the problem and “force some employers to adjust their behaviour”.

What many disabled employees want to see are improvements to inclusion at work and a focus on their experiences, rather than just the reporting of figures. Whether new rules are imposed in this area or not, Casey believes that closing the disability pay gap requires a wholesale change of attitude among UK employers.

“I don’t think mandatory disability workforce reporting is the key to closing the employment gap,” she says. “We need to work closely with businesses to create more inclusive workplaces and to cultivate cultures of trust.”



The post Could mandatory disability workforce reporting help to tackle pay disparity? appeared first on Raconteur.

]]>
Employee in a wheelchair discusses ideas with colleagues in the office

Listed firms in the UK are already obliged to disclose their gender pay gaps, but the government is proposing to extend this requirement to cover disabled and non-disabled staff


A disabled person working in the UK was paid 13.8% less on average than their non-disabled counterpart last year, according to the Office for National Statistics (ONS).

Given that this country is home to 14.6 million disabled people – of whom roughly a third are in work – it’s clear that disability discrimination in employment remains a significant problem. Yet, while there have been concerted efforts to close the gender pay gap, the difference in remuneration between disabled and non-disabled employees has tended to go under the radar.

Caroline Casey is the founder of The Valuable 500, a coalition of CEOs who have pledged to improve disability inclusion. She says: “For far too long, disability has been invisible in comparison with other minority concerns. Over and over again, the statistics show how disabled workers are consistently being overlooked and underserved.”

In an attempt to address this problem, the government has held a consultation to collect views on voluntary and mandatory disability workforce reporting. Its full findings were scheduled to be published in June, but the results have yet to be formally announced. 

Speaking before the consultation began in December 2021, the minister for disabled people, health and work, Chloe Smith, outlined the government’s aims. “We want to support employers to have the right information, so they can take the steps needed to make their organisations inclusive for all,” she said.

Despite Westminster’s belief that greater transparency could help to reduce the disability pay gap, views among employers and disabled people are mixed when it comes to whether mandatory disclosures would have the desired impact.

Casey says: “Reporting is not a magic wand. It would catch only the number of disabled people who are employed, not those who may have lost employment or be looking for work.”

Issues concerning reporting and individual identity further complicate matters. More than half of employers (52%) have reported problems collecting data on disability. The fact that 80% of disabilities are invisible – and that many disabled people choose to hide their condition – is one reason for this.

“There is also a lack of consensus worldwide regarding the definition of disability,” Casey notes. “But we shouldn’t underestimate the need for employees to self-identify without fear of negative repercussions, of course.”

Holding companies accountable

Other experts are more confident about the likely effectiveness of compulsory disclosures. Steve Ingham, CEO of PageGroup, is a wheelchair user and an advocate for mandatory reporting on disability. He believes that it would “ensure inclusion of people with disabilities in the workplace”. 

Ingham adds: “The only way to drive change is to hold companies accountable. Measurement is crucial when it comes to closing the gap, but this will provide truthful data and actionable insights only once the work environment feels inclusive and employees are comfortable expressing their disability.”

Acknowledging that reporting is not the only solution, Ingham observes that the transparency and open culture at PageGroup has helped to empower more of its employees to talk about their disabilities at work.

The Chartered Institute of Personnel and Development supports the proposed move towards compulsory disclosures as part of the wider need to “drive genuine change” in how employers treat disabled people. 

But its senior policy adviser on resourcing and inclusion, Claire McCartney, warns that employers must be prepared to report effectively. The risk is that it becomes a mere compliance exercise.

She says: “We’re concerned that a mandatory approach could encourage organisations to adopt a superficial tick-box attitude rather than developing practices that lead to lasting improvements. Many organisations lack the systems and infrastructure to collect data effectively on disability and long-term health conditions. Such data is meaningful only if it is understood and acted upon to inform real, sustainable change.”

Such criticism could be levelled at the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. Despite having submitted mandatory reports for five years, many businesses have made little progress in closing their gender pay gaps. In some cases, these have even widened.

“Gender and racial inequalities remain rife in the workplace, despite the introduction of reporting,” Casey says. “Enforcement bodies simply don’t have enough resources. Consequently, many firms do not report. We need to get to the root of the problem to build better and faster.”

How can businesses close the disability pay gap?

One of the challenges for employers is to find a reporting method that accounts for the wide range of disabled experiences and identities. One of the issues arising from the government’s consultation is the fact that mandatory reporting would require ministers to decide on a definition of disability and the categorisations of types of disabilities and conditions.

This is particularly pertinent given that the disability pay gap varies depending on the type of disability and the number of conditions an individual may have.

Xavier Langlois is chief legal and impact officer at Beamery, a talent management platform. He says: “For the employer, the challenge will be to report in a consistent, anonymised way and remain mindful that data-capture requests could cause disclosure issues for those employees who aren’t comfortable that their employer has access to their sensitive information.”

Some respondents to the consultation have also expressed concern that making such measurements mandatory could contribute to “the impression that disability is ‘hard work’ and a ‘hassle’”. 

McCartney says: “For real progress to be made, employers must take a systemic approach to ensure that their organisations are inclusive to disabled people and those with long-term health conditions. That involves looking critically at how they operate, from their processes and procedures to their culture and people management practices.”

Although the preliminary results from the consultation suggest that there’s little evidence to support a mandatory approach to disability workforce reporting. Langlois believes that such a measure could draw more attention to the problem and “force some employers to adjust their behaviour”.

What many disabled employees want to see are improvements to inclusion at work and a focus on their experiences, rather than just the reporting of figures. Whether new rules are imposed in this area or not, Casey believes that closing the disability pay gap requires a wholesale change of attitude among UK employers.

“I don’t think mandatory disability workforce reporting is the key to closing the employment gap,” she says. “We need to work closely with businesses to create more inclusive workplaces and to cultivate cultures of trust.”



The post Could mandatory disability workforce reporting help to tackle pay disparity? appeared first on Raconteur.

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Challenger banks challenged on fraud https://www.raconteur.net/finance/challenger-banks-challenged-on-fraud/ Fri, 19 Aug 2022 13:54:10 +0000 //www.raconteur.net/?p=157735 Advertisement for challenger bank Monzo on the side of a London bus

Their growth has been explosive, and they’ve shaken up the world of banking – but there are growing concerns about how well challenger banks and fintech firms are handling fraud


Advertisement for challenger bank Monzo on the side of a London bus
In July, it was revealed that challenger bank Monzo is being investigated by the FCA for possible AML breaches

Keen to increase competition and improve services for customers, the government and regulators in the UK and around the world have, over recent years, encouraged the growth of challenger banks.

This drive has been successful – the market industry was valued at $20.4bn in 2019 and is projected to reach $471.0bn by 2027, a CAGR of 48.1% from 2020 to 2027, according to Allied Market Research. 

But there are now growing concerns about how well some of these dynamic newcomers are managing financial crime fraud and anti-money laundering (AML). The Financial Conduct Authority (FCA) undertook a review last year, which was published in April this year, and identified a noticeable increase in suspicious activity reports. The regulator is particularly concerned about the adequacy of checks carried out by challenger banks when onboarding new customers

It highlights that in some instances, these banks failed to adequately check their customers’ income and occupation. The FCA also felt that some banks had under-developed or even non-existent customer risk-assessment frameworks and that there was insufficient detail here.  

“Challenger banks are an important part of the UK’s retail banking offering,” says Sarah Pritchard, executive director for markets at the FCA. “However, there cannot be a trade-off between quick and easy account opening and robust financial crime controls.” 

Fintech firms investigated for financial crime

Fintechs are in a similar position – in July, it was revealed that Monzo is being investigated by the FCA for possible AML breaches. “The prevention of financial crime is an issue that affects the entire banking industry and one which Monzo is taking extremely seriously,” says the firm. “Over the past year, we have made major investments in our controls in this area as a priority and will continue to invest heavily in this part of the business.”

The issue is not solely one that affects UK challengers. Last year the German financial regulator BaFin slapped N26, an online bank with more than 7 million customers in 24 markets, with a €4.25m (£3.59m) fine for delayed reports of suspicious activity in 2019 and 2020. In response, N26 said: “With the growing importance of ecommerce, we have taken numerous detailed measures and have also established structures and processes that meet the highest standards of financial crime prevention to address this pertinent global threat.”

Can challenger banks continue to acquire customers at such a rapid rate and then offer them a frictionless customer experience, while at the same time managing growing threats from fraudsters and cybercriminals?  

Part of the problem is that the speed of processes and interactions and the relative lack of bureaucracy that forms a key selling point for the challenger banks is as appealing to fraudsters as it is to legitimate customers. Their lean, agile makeup means that they might lack the large anti-fraud and money laundering teams and extensive experience of the legacy banks.

While many challengers exercise verification controls like biometric technology, they must also provide adequate checks on their customers’ income, occupation and background

It remains to be seen whether, in the name of addressing increased concerns about fraud, these banks will be prepared and able to reject more new customer applications and possibly annoy existing customers by delaying and flagging up certain transactions. 

“First and foremost, challenger banks must review their onboarding process to verify the identity of the customer and minimise the risk of money laundering,” says Armen Najarian, chief identity officer at Outseer, an AI-driven anti-fraud firm. “While many challengers exercise verification controls like biometric technology, they must also provide adequate checks on their customers’ income, occupation and background.”

Najarian adds: “Machine learning has a big impact on power fraud prevention controls, giving challengers the same level of risk intelligence as a legacy bank. These solutions work in the background to verify customer identities and monitor transactions, credit card companies, and banks so challengers can detect and prevent fraud, as well as comply with anti-money laundering regulations.” 

The role of regulators

Given the novel, disruptive and rapidly evolving business models and systems employed by these institutions, does the law and the approach of regulators need to change here? “There is an assumption in the financial services industry that a substantial sum of money will inevitably be lost to fraud every year – but this need not be the case,” says Najarian. “Regulators should do more to crack down on fraud, and this could mean having a minimum threshold for fraud prevention to ensure that banks have adequate protections in place to keep up with skyrocketing cases of fraudulent activity.”

Challenger banks can take some comfort from the fact that the FCA’s report is not entirely damning. It has found that: “Some challenger banks [are] mitigating fraud risk by incorporating additional monitoring for known fraud typologies at onboarding and as part of account monitoring. This included credit industry fraud avoidance system (CIFAS) checking, as well as checks on customers using multiple devices to manage their accounts.”

Their digital-first approach and sophisticated algorithms mean that challenger banks and fintech companies should be in a good position to start accumulating vast quantities of data quickly and effectively. This can be used, in conjunction with technologies such as AI and machine learning to identify more actual and potential instances of fraud and money laundering and to take action more quickly and effectively. 

Meanwhile, as many longer-standing banks continue to struggle with their legacy IT systems, there is the potential for the new generation of banks and financial institutions to innovate and lead the way in managing this increasingly important issue.



The post Challenger banks challenged on fraud appeared first on Raconteur.

]]>
Advertisement for challenger bank Monzo on the side of a London bus

Their growth has been explosive, and they’ve shaken up the world of banking – but there are growing concerns about how well challenger banks and fintech firms are handling fraud


Advertisement for challenger bank Monzo on the side of a London bus
In July, it was revealed that challenger bank Monzo is being investigated by the FCA for possible AML breaches

Keen to increase competition and improve services for customers, the government and regulators in the UK and around the world have, over recent years, encouraged the growth of challenger banks.

This drive has been successful – the market industry was valued at $20.4bn in 2019 and is projected to reach $471.0bn by 2027, a CAGR of 48.1% from 2020 to 2027, according to Allied Market Research. 

But there are now growing concerns about how well some of these dynamic newcomers are managing financial crime fraud and anti-money laundering (AML). The Financial Conduct Authority (FCA) undertook a review last year, which was published in April this year, and identified a noticeable increase in suspicious activity reports. The regulator is particularly concerned about the adequacy of checks carried out by challenger banks when onboarding new customers

It highlights that in some instances, these banks failed to adequately check their customers’ income and occupation. The FCA also felt that some banks had under-developed or even non-existent customer risk-assessment frameworks and that there was insufficient detail here.  

“Challenger banks are an important part of the UK’s retail banking offering,” says Sarah Pritchard, executive director for markets at the FCA. “However, there cannot be a trade-off between quick and easy account opening and robust financial crime controls.” 

Fintech firms investigated for financial crime

Fintechs are in a similar position – in July, it was revealed that Monzo is being investigated by the FCA for possible AML breaches. “The prevention of financial crime is an issue that affects the entire banking industry and one which Monzo is taking extremely seriously,” says the firm. “Over the past year, we have made major investments in our controls in this area as a priority and will continue to invest heavily in this part of the business.”

The issue is not solely one that affects UK challengers. Last year the German financial regulator BaFin slapped N26, an online bank with more than 7 million customers in 24 markets, with a €4.25m (£3.59m) fine for delayed reports of suspicious activity in 2019 and 2020. In response, N26 said: “With the growing importance of ecommerce, we have taken numerous detailed measures and have also established structures and processes that meet the highest standards of financial crime prevention to address this pertinent global threat.”

Can challenger banks continue to acquire customers at such a rapid rate and then offer them a frictionless customer experience, while at the same time managing growing threats from fraudsters and cybercriminals?  

Part of the problem is that the speed of processes and interactions and the relative lack of bureaucracy that forms a key selling point for the challenger banks is as appealing to fraudsters as it is to legitimate customers. Their lean, agile makeup means that they might lack the large anti-fraud and money laundering teams and extensive experience of the legacy banks.

While many challengers exercise verification controls like biometric technology, they must also provide adequate checks on their customers’ income, occupation and background

It remains to be seen whether, in the name of addressing increased concerns about fraud, these banks will be prepared and able to reject more new customer applications and possibly annoy existing customers by delaying and flagging up certain transactions. 

“First and foremost, challenger banks must review their onboarding process to verify the identity of the customer and minimise the risk of money laundering,” says Armen Najarian, chief identity officer at Outseer, an AI-driven anti-fraud firm. “While many challengers exercise verification controls like biometric technology, they must also provide adequate checks on their customers’ income, occupation and background.”

Najarian adds: “Machine learning has a big impact on power fraud prevention controls, giving challengers the same level of risk intelligence as a legacy bank. These solutions work in the background to verify customer identities and monitor transactions, credit card companies, and banks so challengers can detect and prevent fraud, as well as comply with anti-money laundering regulations.” 

The role of regulators

Given the novel, disruptive and rapidly evolving business models and systems employed by these institutions, does the law and the approach of regulators need to change here? “There is an assumption in the financial services industry that a substantial sum of money will inevitably be lost to fraud every year – but this need not be the case,” says Najarian. “Regulators should do more to crack down on fraud, and this could mean having a minimum threshold for fraud prevention to ensure that banks have adequate protections in place to keep up with skyrocketing cases of fraudulent activity.”

Challenger banks can take some comfort from the fact that the FCA’s report is not entirely damning. It has found that: “Some challenger banks [are] mitigating fraud risk by incorporating additional monitoring for known fraud typologies at onboarding and as part of account monitoring. This included credit industry fraud avoidance system (CIFAS) checking, as well as checks on customers using multiple devices to manage their accounts.”

Their digital-first approach and sophisticated algorithms mean that challenger banks and fintech companies should be in a good position to start accumulating vast quantities of data quickly and effectively. This can be used, in conjunction with technologies such as AI and machine learning to identify more actual and potential instances of fraud and money laundering and to take action more quickly and effectively. 

Meanwhile, as many longer-standing banks continue to struggle with their legacy IT systems, there is the potential for the new generation of banks and financial institutions to innovate and lead the way in managing this increasingly important issue.



The post Challenger banks challenged on fraud appeared first on Raconteur.

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What will the COO of the future look like? https://www.raconteur.net/c-suite/what-will-the-coo-of-the-future-look-like/ Thu, 18 Aug 2022 16:47:13 +0000 //www.raconteur.net/?p=157700 What will the future COO look like? Chief Operating Officer

Major changes are on the horizon for the COO’s role. Is it a case of evolve to survive or become extinct?


What will the future COO look like? Chief Operating Officer

The COO’s role has largely been to ensure that operational processes run smoothly and efficiently, establish strategy for productivity and performance and work with the C-suite to set the corporate vision and culture. But the Covid pandemic has changed everything. Organisations are navigating a new hybrid workforce, ongoing supply chain disruption, geopolitical uncertainty and shifting customer demands. 

In many cases it is the COO, rather than another member of the C-suite, who is spearheading operational changes in the post-pandemic world. And they are well placed to do this. Crisis management is the COO’s area of expertise, notes Abigail Vaughan, COO for HR and payroll specialist Zellis. Resilience is now a priority for building organisations back stronger.

“Changes to the workplace and the pace of business post-pandemic, together with rising customer expectations, require stamina, resilience and contagious positivity,” says Vaughan. “It feels like we’re awakening from hibernation. And as the COO you need to help wake people up as fast as possible to avoid being left behind.”

But while COOs are taking the lead in rebuilding their enterprises, how does that translate to the new hybrid working landscape? Does the COO need to learn new skills for this evolving environment?

Adaptability will be key

James Bradley is COO at facilities management provider The Churchill Group. By its nature, Churchill has staff that work onsite and in locations that vary from offices to trains, so he is well versed in the challenges of dealing with a disparate workforce. He says internal communications are important when navigating the management of a distributed workforce.

“Meaningful and effective communications are key to cultural cohesion across the business and ensuring that we’re all working to the same goals,” he says.

Vaughan has also found she has to sync up more with other teams in the company. “Long gone are the days when every department could pursue its own objectives and it would come together at some point. 

“To maximise the impact of change, all areas of the company need to work together on the same things. Otherwise, siloes and frustrations arise and not only do your own employees become disengaged because it feels difficult to get things done, but your customers become aware of it.”

More than ever, COOs must be adaptable. Simon Nolan is senior partner at executive search firm Page Executive and says this means understanding and adopting new technologies and the supply chains that relate to their industry.

“The pace of change is unrelenting. The mark of a successful COO is one who can move with the times and implement new skills needed for their business,” he says.

Nolan says operations in the digital world have become more complicated as customers expect to be served and attended to in different ways, usually with a multichannel approach to the business. “COOs need to manage the expectations of technology and infrastructure against the commercial demands of the business. Finding that balance can be challenging because the role is evolving.”

The mark of a successful COO is one who can move with the times and implement new skills needed for their business

But could the COO evolve to the point of becoming extinct? Liz Parnell, COO at Rackspace Technology, believes so.

“COOs traditionally focus on KPIs and metrics, delivery and revenue but much of that is already automated,” she notes. “Now it’s about people and understanding the needs of employees as we navigate new hybrid-working styles. To a great extent we are now ‘chief empathy officers’. People have always been a business’s most valuable asset, but the ability to listen to and understand the needs of employees has never been more important.”

Parnell says that COOs will need to use their intuition and emotional intelligence for the business’ needs: to add value in breaking down internal silos; integrate new business and understand their workforce. Unless they continue to listen to staff feedback during the changes, trust will be broken.

“The key skills required now are transparency, honesty and empathy, and clarity in communication and flexibility – a decision made today may no longer be the right one in two months’ time. So, awareness and humility to adapt are vital for this working era,” she explains.

How will the COO role change in the future?

Parnell suggests that while every organisation is working towards a better-defined post-pandemic reality, “the truth is that no one has this figured out”. This, she says, is clear from the diversity of approaches, “from Elon Musk expecting staff in the office full time, to other companies experimenting with a four-day working week.

The return to office will likely be slow and will rely on encouragement. The challenge will lie with middle management who will be implementing behavioural changes and it will be a great test of their leadership skills. 

“My advice to them is to lead by example, to be able to honestly and authentically feed back the benefits of the in-person, onsite experience.”

We’ll see the role morph into empathy officers who take the lead to advocate on behalf of their employees

Opinions, though, are divided as to what the future COO will look like – or whether they will exist at all.

Parnell is adamant that the role – at least as we recognise it – is on its way out. “I don’t see the role of COO existing in five to 10 years because of the current evolution of the workplace,” she says. “We’ll see the role morph into empathy officers who take the lead to advocate on behalf of their employees, with being head of business integration to break down silos for the betterment of an organisation’s future.” 

Vaughan says she doesn’t believe that every company needs a COO or that the role is needed all of the time. The role, she says, “usually grows out of a specific need to ‘fix something’ and as organisations evolve and mature, the need for the role should be kept under review.”

But she adds that when it is needed, “what will remain true is that it will be a broad, multifaceted role, with responsibilities specific to the context you’re working in and require the role holder to be highly collaborative and able to adapt.”

But Nolan maintains that the COO will retain its position as a crucial part of any senior leadership team, regardless of a business’s size, industry or commercial interests.

He says: “It is in the best interest of any company looking to be ahead of the curve to have a COO. The COO is the person who has to deliver on behalf of the customer and drive success.”

5 tips for recruiting a COO

With the role changing so extensively, what should hirers look for in a COO? Dr Becca Franssen, partner at international executive search firm, Perrett Laver, pinpoints the new key elements.



The post What will the COO of the future look like? appeared first on Raconteur.

]]>
What will the future COO look like? Chief Operating Officer

Major changes are on the horizon for the COO’s role. Is it a case of evolve to survive or become extinct?


What will the future COO look like? Chief Operating Officer

The COO’s role has largely been to ensure that operational processes run smoothly and efficiently, establish strategy for productivity and performance and work with the C-suite to set the corporate vision and culture. But the Covid pandemic has changed everything. Organisations are navigating a new hybrid workforce, ongoing supply chain disruption, geopolitical uncertainty and shifting customer demands. 

In many cases it is the COO, rather than another member of the C-suite, who is spearheading operational changes in the post-pandemic world. And they are well placed to do this. Crisis management is the COO’s area of expertise, notes Abigail Vaughan, COO for HR and payroll specialist Zellis. Resilience is now a priority for building organisations back stronger.

“Changes to the workplace and the pace of business post-pandemic, together with rising customer expectations, require stamina, resilience and contagious positivity,” says Vaughan. “It feels like we’re awakening from hibernation. And as the COO you need to help wake people up as fast as possible to avoid being left behind.”

But while COOs are taking the lead in rebuilding their enterprises, how does that translate to the new hybrid working landscape? Does the COO need to learn new skills for this evolving environment?

Adaptability will be key

James Bradley is COO at facilities management provider The Churchill Group. By its nature, Churchill has staff that work onsite and in locations that vary from offices to trains, so he is well versed in the challenges of dealing with a disparate workforce. He says internal communications are important when navigating the management of a distributed workforce.

“Meaningful and effective communications are key to cultural cohesion across the business and ensuring that we’re all working to the same goals,” he says.

Vaughan has also found she has to sync up more with other teams in the company. “Long gone are the days when every department could pursue its own objectives and it would come together at some point. 

“To maximise the impact of change, all areas of the company need to work together on the same things. Otherwise, siloes and frustrations arise and not only do your own employees become disengaged because it feels difficult to get things done, but your customers become aware of it.”

More than ever, COOs must be adaptable. Simon Nolan is senior partner at executive search firm Page Executive and says this means understanding and adopting new technologies and the supply chains that relate to their industry.

“The pace of change is unrelenting. The mark of a successful COO is one who can move with the times and implement new skills needed for their business,” he says.

Nolan says operations in the digital world have become more complicated as customers expect to be served and attended to in different ways, usually with a multichannel approach to the business. “COOs need to manage the expectations of technology and infrastructure against the commercial demands of the business. Finding that balance can be challenging because the role is evolving.”

The mark of a successful COO is one who can move with the times and implement new skills needed for their business

But could the COO evolve to the point of becoming extinct? Liz Parnell, COO at Rackspace Technology, believes so.

“COOs traditionally focus on KPIs and metrics, delivery and revenue but much of that is already automated,” she notes. “Now it’s about people and understanding the needs of employees as we navigate new hybrid-working styles. To a great extent we are now ‘chief empathy officers’. People have always been a business’s most valuable asset, but the ability to listen to and understand the needs of employees has never been more important.”

Parnell says that COOs will need to use their intuition and emotional intelligence for the business’ needs: to add value in breaking down internal silos; integrate new business and understand their workforce. Unless they continue to listen to staff feedback during the changes, trust will be broken.

“The key skills required now are transparency, honesty and empathy, and clarity in communication and flexibility – a decision made today may no longer be the right one in two months’ time. So, awareness and humility to adapt are vital for this working era,” she explains.

How will the COO role change in the future?

Parnell suggests that while every organisation is working towards a better-defined post-pandemic reality, “the truth is that no one has this figured out”. This, she says, is clear from the diversity of approaches, “from Elon Musk expecting staff in the office full time, to other companies experimenting with a four-day working week.

The return to office will likely be slow and will rely on encouragement. The challenge will lie with middle management who will be implementing behavioural changes and it will be a great test of their leadership skills. 

“My advice to them is to lead by example, to be able to honestly and authentically feed back the benefits of the in-person, onsite experience.”

We’ll see the role morph into empathy officers who take the lead to advocate on behalf of their employees

Opinions, though, are divided as to what the future COO will look like – or whether they will exist at all.

Parnell is adamant that the role – at least as we recognise it – is on its way out. “I don’t see the role of COO existing in five to 10 years because of the current evolution of the workplace,” she says. “We’ll see the role morph into empathy officers who take the lead to advocate on behalf of their employees, with being head of business integration to break down silos for the betterment of an organisation’s future.” 

Vaughan says she doesn’t believe that every company needs a COO or that the role is needed all of the time. The role, she says, “usually grows out of a specific need to ‘fix something’ and as organisations evolve and mature, the need for the role should be kept under review.”

But she adds that when it is needed, “what will remain true is that it will be a broad, multifaceted role, with responsibilities specific to the context you’re working in and require the role holder to be highly collaborative and able to adapt.”

But Nolan maintains that the COO will retain its position as a crucial part of any senior leadership team, regardless of a business’s size, industry or commercial interests.

He says: “It is in the best interest of any company looking to be ahead of the curve to have a COO. The COO is the person who has to deliver on behalf of the customer and drive success.”

5 tips for recruiting a COO

With the role changing so extensively, what should hirers look for in a COO? Dr Becca Franssen, partner at international executive search firm, Perrett Laver, pinpoints the new key elements.



The post What will the COO of the future look like? appeared first on Raconteur.

]]>
The climate crisis’ threat to banks https://www.raconteur.net/finance/financial-services/the-climate-crisis-threat-to-banks/ Thu, 18 Aug 2022 16:43:00 +0000 //www.raconteur.net/?p=157705 Aeral view of London from the East

A recent Bank of England report showed financial businesses need to work harder to manage climate risks, but does government regulation have a role to play too?


Aeral view of London from the East

In May 2022, the Bank of England published the results of its first ever climate stress test, which sought to explore the financial risks posed by the climate crisis and transition to net zero for the largest UK banks and insurers and the broader financial system.

The Climate Biennial Exploratory Scenario (CBES) outlined two types of risk associated with the climate crisis: those which arise while transitioning from a carbon-intensive to a net-zero economy, known as transition risks, and those occurring from higher global temperatures if insufficient action is taken, known as physical risks. The CBES then tested firms according to three potential scenarios, one in which early action against the climate crisis is taken, one where late action is taken and another where no action is taken at all.

The report found that while UK banks and insurers are making “good progress in some aspects of their climate risk management” they still need to do much more “to understand and manage their exposure to climate risks”. It noted that climate risks “are likely to create a drag on the profitability of banks and insurers, particularly if they are unable to manage these risks effectively” with losses of up to 10-15%, which could be passed onto customers. And that “the early action policy path has the highest probability of success in terms of limiting climate change”, while acting late would “leave governments more exposed to the risk of policy coordination failure”.

Oscar Warwick Thompson, Head of Policy and Communications at the UK Sustainable Investment and Finance Association (UKSIF) supports the need for early action from banks and investors in the energy transition to minimise climate risk. “The Climate Change Committee’s recent progress report said we’re off track in terms of delivering net zero. Acting at pace, ambition and scale is going to reduce the risk of stranded assets [from carbon-intensive industries] and future losses on company’s balance sheets for investors and their clients’ portfolios,” he says.

Warwick Thompson also warns of the transition risks to financial businesses from consumer expectations when it comes to a firm’s path to net zero. “They are less likely to use a company’s products and services if they’re not being seen to take action,” he says. While another key transition risk is the shifting regulatory and policy environment. “As that becomes clearer and more robust as we move towards net zero in 2050, those who haven’t adequately responded or taken into account the impacts of these regulations into their portfolios run the risk of investments becoming less valuable over time,” he says.

“It’s always a question of being a first mover or a laggard,” says Dr Daniel Tischer, a Senior Lecturer at Sheffield University Management School and specialist in green finance. “If you divest early on you should get out ok but if you leave it until the very end and you’re the last bank in town then whatever you’re trying to sell is worthless.”

Tischer says there is a lot of diversity and staggered positions amongst fund managers in terms of how they approach divesting from carbon-intensive industries but warns there will always be those looking to profit from the chaos. “There are a lot of sensible people out there but there are also a lot of people who have other motives,” he says. “Destabilisation creates profits so in that sense you can see how people are playing with the narrative for their own gain.”

Before Russia invaded Ukraine, Tischer thinks a lot of banks and financial actors were on the right track. “They were attempting to do the right thing by investing and supporting firms who were positioning themselves away from polluting industry practices,” he says, giving the example of Allianz Insurance, who were quite vocal on those grounds. But he worries the energy security crisis has set things back.

“Looking at the UK, we’re currently seeing more investment into taking gas out of the North Sea to reduce the impact of the windfall tax. That is a very problematic approach, and completely the wrong incentive to give to corporations. It gives the signal that fossil fuels aren’t dead, and gives the market a new lease of life,” he says. “Why didn’t we encourage [energy firms] to get a tax reduction for any ten billion they put into renewable energy in the short term? The CEO of BP made it clear they are keen to invest in renewable energy.”

Warwick Thompson believes banks and investors can still play a crucial role in steering oil and gas majors towards positive climate action in the future. “The profits enjoyed by some of these companies have been quite considerable in light of the rising oil and gas prices,” he says. “So, [we would advocate] using these huge balance sheets as an opportunity to transition to a more sustainable model in the future. And when oil and gas majors are looking to raise finance in the bond market, investors can use their stewardship to pressure oil and gas companies, in effect to do their own public policy.”

The UK is ahead of the game in terms of green finance, so banks and financial institutions are well positioned to take advantage of the energy transition. “We have been a world leader in sustainable finance for a number of years and a big part of that has come from promoting an advanced world-leading regulatory framework,” says Warwick Thompson. “In 2019, we were one of the first to legislate to reduce emissions to net zero by 2050 and the first of the G20 to bring in TCFD (task force on climate-related financial disclosures) for the largest companies.” TCFD means businesses are required by law to include climate risks in their annual reporting.

But he warns, much of this progress is now at risk due to delays to key pieces of legislation on sustainable finance, including around transparency and SDR, the sustainable disclosure requirements for corporates and financial institutions.

“There is a sense the government wanted to minimise the regulatory burden on business,” he says, “but for investors more regulation gives you a better idea of what’s going on in business and better disclosure incentivises capital to flow towards those companies.”

Whoever the next Prime Minister is, it’s hoped they’ll reaffirm the UK’s role as sustainable leaders on green finance and net zero. 

As Tischer says: “The narrative should be much more forthcoming: ‘This is a threat but also a great opportunity for us.’”



The post The climate crisis’ threat to banks appeared first on Raconteur.

]]>
Aeral view of London from the East

A recent Bank of England report showed financial businesses need to work harder to manage climate risks, but does government regulation have a role to play too?


Aeral view of London from the East

In May 2022, the Bank of England published the results of its first ever climate stress test, which sought to explore the financial risks posed by the climate crisis and transition to net zero for the largest UK banks and insurers and the broader financial system.

The Climate Biennial Exploratory Scenario (CBES) outlined two types of risk associated with the climate crisis: those which arise while transitioning from a carbon-intensive to a net-zero economy, known as transition risks, and those occurring from higher global temperatures if insufficient action is taken, known as physical risks. The CBES then tested firms according to three potential scenarios, one in which early action against the climate crisis is taken, one where late action is taken and another where no action is taken at all.

The report found that while UK banks and insurers are making “good progress in some aspects of their climate risk management” they still need to do much more “to understand and manage their exposure to climate risks”. It noted that climate risks “are likely to create a drag on the profitability of banks and insurers, particularly if they are unable to manage these risks effectively” with losses of up to 10-15%, which could be passed onto customers. And that “the early action policy path has the highest probability of success in terms of limiting climate change”, while acting late would “leave governments more exposed to the risk of policy coordination failure”.

Oscar Warwick Thompson, Head of Policy and Communications at the UK Sustainable Investment and Finance Association (UKSIF) supports the need for early action from banks and investors in the energy transition to minimise climate risk. “The Climate Change Committee’s recent progress report said we’re off track in terms of delivering net zero. Acting at pace, ambition and scale is going to reduce the risk of stranded assets [from carbon-intensive industries] and future losses on company’s balance sheets for investors and their clients’ portfolios,” he says.

Warwick Thompson also warns of the transition risks to financial businesses from consumer expectations when it comes to a firm’s path to net zero. “They are less likely to use a company’s products and services if they’re not being seen to take action,” he says. While another key transition risk is the shifting regulatory and policy environment. “As that becomes clearer and more robust as we move towards net zero in 2050, those who haven’t adequately responded or taken into account the impacts of these regulations into their portfolios run the risk of investments becoming less valuable over time,” he says.

“It’s always a question of being a first mover or a laggard,” says Dr Daniel Tischer, a Senior Lecturer at Sheffield University Management School and specialist in green finance. “If you divest early on you should get out ok but if you leave it until the very end and you’re the last bank in town then whatever you’re trying to sell is worthless.”

Tischer says there is a lot of diversity and staggered positions amongst fund managers in terms of how they approach divesting from carbon-intensive industries but warns there will always be those looking to profit from the chaos. “There are a lot of sensible people out there but there are also a lot of people who have other motives,” he says. “Destabilisation creates profits so in that sense you can see how people are playing with the narrative for their own gain.”

Before Russia invaded Ukraine, Tischer thinks a lot of banks and financial actors were on the right track. “They were attempting to do the right thing by investing and supporting firms who were positioning themselves away from polluting industry practices,” he says, giving the example of Allianz Insurance, who were quite vocal on those grounds. But he worries the energy security crisis has set things back.

“Looking at the UK, we’re currently seeing more investment into taking gas out of the North Sea to reduce the impact of the windfall tax. That is a very problematic approach, and completely the wrong incentive to give to corporations. It gives the signal that fossil fuels aren’t dead, and gives the market a new lease of life,” he says. “Why didn’t we encourage [energy firms] to get a tax reduction for any ten billion they put into renewable energy in the short term? The CEO of BP made it clear they are keen to invest in renewable energy.”

Warwick Thompson believes banks and investors can still play a crucial role in steering oil and gas majors towards positive climate action in the future. “The profits enjoyed by some of these companies have been quite considerable in light of the rising oil and gas prices,” he says. “So, [we would advocate] using these huge balance sheets as an opportunity to transition to a more sustainable model in the future. And when oil and gas majors are looking to raise finance in the bond market, investors can use their stewardship to pressure oil and gas companies, in effect to do their own public policy.”

The UK is ahead of the game in terms of green finance, so banks and financial institutions are well positioned to take advantage of the energy transition. “We have been a world leader in sustainable finance for a number of years and a big part of that has come from promoting an advanced world-leading regulatory framework,” says Warwick Thompson. “In 2019, we were one of the first to legislate to reduce emissions to net zero by 2050 and the first of the G20 to bring in TCFD (task force on climate-related financial disclosures) for the largest companies.” TCFD means businesses are required by law to include climate risks in their annual reporting.

But he warns, much of this progress is now at risk due to delays to key pieces of legislation on sustainable finance, including around transparency and SDR, the sustainable disclosure requirements for corporates and financial institutions.

“There is a sense the government wanted to minimise the regulatory burden on business,” he says, “but for investors more regulation gives you a better idea of what’s going on in business and better disclosure incentivises capital to flow towards those companies.”

Whoever the next Prime Minister is, it’s hoped they’ll reaffirm the UK’s role as sustainable leaders on green finance and net zero. 

As Tischer says: “The narrative should be much more forthcoming: ‘This is a threat but also a great opportunity for us.’”



The post The climate crisis’ threat to banks appeared first on Raconteur.

]]>
Will Vietnam continue to rise as a new technology power? https://www.raconteur.net/global-business/will-vietnam-continue-to-rise-as-a-new-technology-power/ Thu, 18 Aug 2022 16:36:29 +0000 //www.raconteur.net/?p=157699 A woman walks during rainfall on Huc Bridge over the Hoan Kiem Lake in downtown Hanoi on August 12, 2022. (Photo by Nhac NGUYEN / AFP) (Photo by NHAC NGUYEN/AFP via Getty Images)

The Vietnamese government has long managed a delicate balancing act between socialism and capitalism. For many technology companies, the opportunities remain attractive in a post-pandemic world


A woman walks during rainfall on Huc Bridge over the Hoan Kiem Lake in downtown Hanoi on August 12, 2022. (Photo by Nhac NGUYEN / AFP) (Photo by NHAC NGUYEN/AFP via Getty Images)

In the past 36 years, Hanoi has changed enormously. The Vietnamese capital still has the tourist-magnet city centre with Hoan Kiem Lake, photogenic narrow houses, Ho Chi Minh’s imposing mausoleum and peaceful temples amid constant traffic noise. But since 1986, when Vietnam started attracting significant foreign investment and encouraging entrepreneurship against a backdrop of a socialist government under the Doi Moi (“restoration”) economic policy, Hanoi has grown along with the technology sector.

There are newer districts, where older homes and businesses are overshadowed by modern glass towers housing corporations and apartments for a growing middle class. Here, the technology sector is helping steer the Vietnamese economy away from reliance on agriculture. 

In addition, the government attracts technology companies to Vietnam with a tax incentive that gives such businesses a preferential tax rate of 10% for 15 years. John Breen, geopolitical consultant for Sibylline, says Vietnam “has the potential to become a hub for technology when you consider the government’s strategic efforts to strengthen the country’s digital economy, which could reach US$52bn (£43bn) by 2025.”

“Vietnam’s internet economy hit 16% growth year on year in 2020, the highest in south-east Asia, and it has the potential to reach US$220bn in gross merchandise value by 2030,” Breen adds. “Under the National Digital Transformation Programme, the Vietnamese government aims to support key economic sectors, which include finance and banking, manufacturing, energy and healthcare.”

Growing Vietnamese companies and attracting investment

Cau Giay district is an example of the new face of Hanoi. Development began in 1996 with the aim of encouraging industrial growth. FPT, with its newly opened towers, located in Cau Giay, is a tech company that has benefited from being in Vietnam since 1999. It launched as a software outsourcing business, aided by a state subsidy, and now offers products and services for industries including aviation, media, automotive, healthcare, logistics and manufacturing. 

Ta Tran Minh, vice president of GAM FPT, the company’s automotive division, is upbeat about the future, particularly as car manufacturers in Korea, Japan and the US markets are embracing their latest software solutions. He says Vietnam has “become more and more attractive for the technology industry”, which he attributes to a combination of government support for tech companies keen to set up in the country and a skilled young population.

While many bright students are still encouraged to pursue medicine or law, Minh says that careers such as software engineers are appealing to more young people, especially when they can study and take advantage of good job opportunities in Vietnam. As well as global projects, such as automotive software, FPT has been developing a young, ambitious workforce by investing in multiple startups under the FPT Ventures umbrella since 2015.  

“We are working with universities here and in other countries and can use the results here in Vietnam,” says Minh, on how FPT is helping avoid a brain drain of young professionals.

As well as an exciting pool of young talent, Breen says Vietnam provides market access to a young, educated, tech-savvy population across Asia. While 88% of people in ASEAN countries have smartphone access, almost 70% are unbanked which, Breen says, provides “a significant market opportunity” for digital payments and remittances.

Brad Gray, senior vice president APAC of Exclusive Networks, views the country as “a pivotal location within the region” for partnerships and distribution. 

He is optimistic about Vietnam as a market for the France-headquartered company’s cyber-security solutions, with the Science, Technology and Innovation Strategy 2021-2030 helping develop local and international tech firms: “The growth in all things digital in the country has been on an exponential rise … [with] Vietnam growing into a major tech hub, especially within the start-up space in recent years.” 

Competing with China, working in the region

China’s ongoing adherence to a zero-Covid policy has enhanced Vietnam’s appeal as a desirable location for technology investment. Minh says that while customers were looking predominantly to China or India for technology partners, many of FPT’s customers are thinking about Vietnam instead.

“China has been having a lot of shutdowns, which is obviously unfortunate for China, but I guess is an advantage for Vietnam,” says Minh.

Breen reiterates Vietnam’s strong position, describing the country as “a strong candidate for many companies considering a ‘China plus one’ supply chain diversification strategy”, thanks to an effective pandemic response, the region’s geopolitics and Vietnam’s relatively low labour costs. As well as Beijing’s zero-covid policy, technological decoupling between western countries and China, attempts by Beijing to clamp down on censorship and data storage rules – and the latest risk of military conflict over Taiwan – have affected the business environment. 

“At the geopolitical level, Vietnam has strengthened bilateral relations with major economies in East Asia, Europe and North America over shared strategic concerns, which has cultivated economic opportunities such as a free trade agreement and an investment protection agreement with the European Union in 2019,” says Breen.

This has drawn big names to Vietnam, according to Breen, such as LG Display’s US$750m port investment in the northern city of Haiphong and Apple starting a technical and management recruitment drive in 2020 for roles in Hanoi and Ho Chi Minh City, as well as shifting some iPad production capacity from China to Vietnam. 

But Breen cautions that if Vietnam is to take a similar approach to China regarding cybersecurity laws that mandate corporations to provide user data and restrict social media content, the risks for tech companies could increase. In addition, other factors, such as corruption, issues with transparency and affiliations with groups that are viewed unfavourably by the ruling Communist Party, could harm the business environment.  

Despite Breen’s warnings, Gray remains optimistic about the future of business in Vietnam and its relationship with China. He says the two countries are “fundamentally different, in terms of demographics, workforce, resources, and skilled labour within the industry” and that sharing a border has helped Vietnam “in terms of strategic placement” to grow as a regional tech hub.

Minh, meanwhile, is keen for FPT to look beyond China for regional partnerships and talent acquisition, with 11 locations in Japan, two Bangkok offices for the Thai market, and a strong presence in the Philippines since 2015. In particular, Minh says the company is expanding its human resources with talent from the Philippines as part of its drive to “create a global working culture”, while still upskilling Vietnamese software engineers.  

He concludes: “The talent stays in Vietnam, we stay in Vietnam and we can all help support Vietnam.”



The post Will Vietnam continue to rise as a new technology power? appeared first on Raconteur.

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A woman walks during rainfall on Huc Bridge over the Hoan Kiem Lake in downtown Hanoi on August 12, 2022. (Photo by Nhac NGUYEN / AFP) (Photo by NHAC NGUYEN/AFP via Getty Images)

The Vietnamese government has long managed a delicate balancing act between socialism and capitalism. For many technology companies, the opportunities remain attractive in a post-pandemic world


A woman walks during rainfall on Huc Bridge over the Hoan Kiem Lake in downtown Hanoi on August 12, 2022. (Photo by Nhac NGUYEN / AFP) (Photo by NHAC NGUYEN/AFP via Getty Images)

In the past 36 years, Hanoi has changed enormously. The Vietnamese capital still has the tourist-magnet city centre with Hoan Kiem Lake, photogenic narrow houses, Ho Chi Minh’s imposing mausoleum and peaceful temples amid constant traffic noise. But since 1986, when Vietnam started attracting significant foreign investment and encouraging entrepreneurship against a backdrop of a socialist government under the Doi Moi (“restoration”) economic policy, Hanoi has grown along with the technology sector.

There are newer districts, where older homes and businesses are overshadowed by modern glass towers housing corporations and apartments for a growing middle class. Here, the technology sector is helping steer the Vietnamese economy away from reliance on agriculture. 

In addition, the government attracts technology companies to Vietnam with a tax incentive that gives such businesses a preferential tax rate of 10% for 15 years. John Breen, geopolitical consultant for Sibylline, says Vietnam “has the potential to become a hub for technology when you consider the government’s strategic efforts to strengthen the country’s digital economy, which could reach US$52bn (£43bn) by 2025.”

“Vietnam’s internet economy hit 16% growth year on year in 2020, the highest in south-east Asia, and it has the potential to reach US$220bn in gross merchandise value by 2030,” Breen adds. “Under the National Digital Transformation Programme, the Vietnamese government aims to support key economic sectors, which include finance and banking, manufacturing, energy and healthcare.”

Growing Vietnamese companies and attracting investment

Cau Giay district is an example of the new face of Hanoi. Development began in 1996 with the aim of encouraging industrial growth. FPT, with its newly opened towers, located in Cau Giay, is a tech company that has benefited from being in Vietnam since 1999. It launched as a software outsourcing business, aided by a state subsidy, and now offers products and services for industries including aviation, media, automotive, healthcare, logistics and manufacturing. 

Ta Tran Minh, vice president of GAM FPT, the company’s automotive division, is upbeat about the future, particularly as car manufacturers in Korea, Japan and the US markets are embracing their latest software solutions. He says Vietnam has “become more and more attractive for the technology industry”, which he attributes to a combination of government support for tech companies keen to set up in the country and a skilled young population.

While many bright students are still encouraged to pursue medicine or law, Minh says that careers such as software engineers are appealing to more young people, especially when they can study and take advantage of good job opportunities in Vietnam. As well as global projects, such as automotive software, FPT has been developing a young, ambitious workforce by investing in multiple startups under the FPT Ventures umbrella since 2015.  

“We are working with universities here and in other countries and can use the results here in Vietnam,” says Minh, on how FPT is helping avoid a brain drain of young professionals.

As well as an exciting pool of young talent, Breen says Vietnam provides market access to a young, educated, tech-savvy population across Asia. While 88% of people in ASEAN countries have smartphone access, almost 70% are unbanked which, Breen says, provides “a significant market opportunity” for digital payments and remittances.

Brad Gray, senior vice president APAC of Exclusive Networks, views the country as “a pivotal location within the region” for partnerships and distribution. 

He is optimistic about Vietnam as a market for the France-headquartered company’s cyber-security solutions, with the Science, Technology and Innovation Strategy 2021-2030 helping develop local and international tech firms: “The growth in all things digital in the country has been on an exponential rise … [with] Vietnam growing into a major tech hub, especially within the start-up space in recent years.” 

Competing with China, working in the region

China’s ongoing adherence to a zero-Covid policy has enhanced Vietnam’s appeal as a desirable location for technology investment. Minh says that while customers were looking predominantly to China or India for technology partners, many of FPT’s customers are thinking about Vietnam instead.

“China has been having a lot of shutdowns, which is obviously unfortunate for China, but I guess is an advantage for Vietnam,” says Minh.

Breen reiterates Vietnam’s strong position, describing the country as “a strong candidate for many companies considering a ‘China plus one’ supply chain diversification strategy”, thanks to an effective pandemic response, the region’s geopolitics and Vietnam’s relatively low labour costs. As well as Beijing’s zero-covid policy, technological decoupling between western countries and China, attempts by Beijing to clamp down on censorship and data storage rules – and the latest risk of military conflict over Taiwan – have affected the business environment. 

“At the geopolitical level, Vietnam has strengthened bilateral relations with major economies in East Asia, Europe and North America over shared strategic concerns, which has cultivated economic opportunities such as a free trade agreement and an investment protection agreement with the European Union in 2019,” says Breen.

This has drawn big names to Vietnam, according to Breen, such as LG Display’s US$750m port investment in the northern city of Haiphong and Apple starting a technical and management recruitment drive in 2020 for roles in Hanoi and Ho Chi Minh City, as well as shifting some iPad production capacity from China to Vietnam. 

But Breen cautions that if Vietnam is to take a similar approach to China regarding cybersecurity laws that mandate corporations to provide user data and restrict social media content, the risks for tech companies could increase. In addition, other factors, such as corruption, issues with transparency and affiliations with groups that are viewed unfavourably by the ruling Communist Party, could harm the business environment.  

Despite Breen’s warnings, Gray remains optimistic about the future of business in Vietnam and its relationship with China. He says the two countries are “fundamentally different, in terms of demographics, workforce, resources, and skilled labour within the industry” and that sharing a border has helped Vietnam “in terms of strategic placement” to grow as a regional tech hub.

Minh, meanwhile, is keen for FPT to look beyond China for regional partnerships and talent acquisition, with 11 locations in Japan, two Bangkok offices for the Thai market, and a strong presence in the Philippines since 2015. In particular, Minh says the company is expanding its human resources with talent from the Philippines as part of its drive to “create a global working culture”, while still upskilling Vietnamese software engineers.  

He concludes: “The talent stays in Vietnam, we stay in Vietnam and we can all help support Vietnam.”



The post Will Vietnam continue to rise as a new technology power? appeared first on Raconteur.

]]>
Crypto’s rapid expansion leaves regulators rushing to keep pace https://www.raconteur.net/legal/cryptos-rapid-expansion-leaves-regulators-rushing-to-keep-pace/ Wed, 17 Aug 2022 14:31:00 +0000 //www.raconteur.net/?p=157319 Bitcoin owner watches the price of their investments change on screen

Enforcement actions are increasing as global regulators step up their efforts to supervise the crypto market, while some jurisdictions are adopting a more crypto-friendly approach


With the value of the global cryptocurrency market north of $3tn (£1.09tn) and mainstream crypto adoption continuing to accelerate, global regulators are racing to keep up.

In March, President Joe Biden signed an executive order that tasks the entire US government with forming a strategy to regulate digital assets, including cryptocurrencies.

Meanwhile, in Europe the EU is in the process of finalising its markets in crypto assets legislation, which seeks to oversee crypto activities that fall outside existing regulations. The UK’s FCA also earlier this year proposed tougher rules on crypto advertising to stamp out false or misleading claims.

“Those who are new to this or just pressed for time will say crypto is unregulated – nothing could be further from the truth,” says Marco Santori, chief legal officer at Kraken, a crypto exchange. 

Much of the early regulatory agenda for cryptocurrencies and the emergence of blockchain technology focused on money services, though since 2017 with the boom in initial coin offerings, that has started broadening into areas such as capital formation, says Santori.

“There are new, emerging uses of blockchain technology that implicate new risks and are creating new industries – it’s those emerging uses that are under regulatory scrutiny,” he says.

But given the rapid pace of crypto adoption, regulators have struggled to keep pace.

“Regulation has lagged but as Biden’s order indicates, there is a growing awareness that there needs to be a much tighter regulatory framework around crypto,” says Ben Richmond, founder and CEO of regtech company Cube Global.

Enforcement actions are also starting to increase. The US Securities and Exchange Commission (SEC), for instance, has brought around 100 cryptocurrency enforcement actions since 2013. The agency’s new chairman, Gary Gensler, said the SEC hopes to start regulating crypto exchanges this year.

“Learnings from those actions are driving regulator behaviour, but that’s where it risks becoming fragmented because you can end up with different approaches to the same problem,” says Richmond.

Methods for regulating cryptocurrencies

Another debate has fizzed around how to regulate crypto – should it be bolted on to existing regulations or regulated as a separate industry, with its own regulator and laws?

Timothy Spangler, a US-based partner at law firm Dechert, believes it should be the former.

“I would rather spend more time understanding the technological impacts than creating new regulators, new crimes and new oversight mechanisms, and then having to debug those over years,” says Spangler. “That could unnecessarily stymie innovation.”

Others argue that the novelty of blockchain technology means it shouldn’t be shoe-horned into current regulations.

“Most regulators are using a traditional approach to regulate crypto,” says William Je, CEO of Hamilton Investment Management. “But crypto is creating new financial products that are entirely different to anything that has come before.”

Some jurisdictions are taking a more active pro-crypto stance to attract crypto businesses, such as US state Wyoming, which has passed a series of crypto-friendly blockchain laws.

“Wyoming has taken a descriptive rather than a prescriptive approach to regulation and is a model for other jurisdictions,” says Santori.

One initiative Wyoming has adopted is creating a banking license that tailors the regulatory regime to the actual risks of the bank. For instance, Kraken was the first crypto company to receive a license under the state’s new banking charter aimed at digital asset businesses, which allows them to take deposits as opposed to make loans.

“It dials up oversight of reserves and forgoes the regulations usually be required for banks that lend,” says Santori. 

This is the biggest hurdle for the development of crypto, so we need more clarity

A focus on crypto-mining activities, particularly around energy use, is also attracting the attention of regulators. China has banned crypto mining, while the EU considered banning certain energy-intensive methods for mining crypto but has since backed down. 

“To say that we need to regulate crypto miners is to say that crypto mining poses a danger, but we’re a long way from quantifying that,” says Spangler. “How comfortable are we that we accurately know the energy usage that miners engage in? Most of the academic surveys are qualified and speculative.”

While regulatory best practice is a work-in-progress, Spangler believes those jurisdictions that tread cautiously are likely to yield more effective long-term outcomes.

“We need to move at the right pace to make good decisions,” he says. “We want to move forward based on knowledge. Move slowly and roll out things as needed – we don’t know where blockchain will move.”

How regulators are addressing crypto across the world

But while the US has traditionally set the standard for global financial regulation, it is not a given that it will shape how crypto regulation develops worldwide.

“Most people would agree that crypto’s centre of gravity initially was the US and Canada, but there’s no reason why having created a new technology or protocol, they would also win the deployment,” says Spangler.

A lack of regulatory harmonisation across jurisdictions is also potentially weighing on the growth of the crypto market.

“Every country has different rules and regulations or even definitions of what should be regulated, so at the moment it’s not clear, which is holding back institutional investors from investing in crypto,” says Je. “This is the biggest hurdle for the development of crypto, so we need more clarity.”

Others believe that while regulation is necessary to safeguard consumers, it could slow the pace of adoption.

“It’s about getting the balance right – how do you protect people but enable this world to flourish,” says Richmond. “The concern is that if the regulation comes in too hard, it will slow down the uptake.”

Worries that too much regulation could choke innovation are likely to be overblown, though Santori believes some innovation will inevitably be constrained as regulators tighten their grip.

“That’s the trade-off when we regulate,” he says. “But we also create a more stable and welcoming environment, so that is the correct lens to view the decision of whether to regulate.”

As blockchain technology continues to thrive and new use cases emerge, one thing is certain: the regulatory backdrop is far from resolved.



The post Crypto’s rapid expansion leaves regulators rushing to keep pace appeared first on Raconteur.

]]>
Bitcoin owner watches the price of their investments change on screen

Enforcement actions are increasing as global regulators step up their efforts to supervise the crypto market, while some jurisdictions are adopting a more crypto-friendly approach


With the value of the global cryptocurrency market north of $3tn (£1.09tn) and mainstream crypto adoption continuing to accelerate, global regulators are racing to keep up.

In March, President Joe Biden signed an executive order that tasks the entire US government with forming a strategy to regulate digital assets, including cryptocurrencies.

Meanwhile, in Europe the EU is in the process of finalising its markets in crypto assets legislation, which seeks to oversee crypto activities that fall outside existing regulations. The UK’s FCA also earlier this year proposed tougher rules on crypto advertising to stamp out false or misleading claims.

“Those who are new to this or just pressed for time will say crypto is unregulated – nothing could be further from the truth,” says Marco Santori, chief legal officer at Kraken, a crypto exchange. 

Much of the early regulatory agenda for cryptocurrencies and the emergence of blockchain technology focused on money services, though since 2017 with the boom in initial coin offerings, that has started broadening into areas such as capital formation, says Santori.

“There are new, emerging uses of blockchain technology that implicate new risks and are creating new industries – it’s those emerging uses that are under regulatory scrutiny,” he says.

But given the rapid pace of crypto adoption, regulators have struggled to keep pace.

“Regulation has lagged but as Biden’s order indicates, there is a growing awareness that there needs to be a much tighter regulatory framework around crypto,” says Ben Richmond, founder and CEO of regtech company Cube Global.

Enforcement actions are also starting to increase. The US Securities and Exchange Commission (SEC), for instance, has brought around 100 cryptocurrency enforcement actions since 2013. The agency’s new chairman, Gary Gensler, said the SEC hopes to start regulating crypto exchanges this year.

“Learnings from those actions are driving regulator behaviour, but that’s where it risks becoming fragmented because you can end up with different approaches to the same problem,” says Richmond.

Methods for regulating cryptocurrencies

Another debate has fizzed around how to regulate crypto – should it be bolted on to existing regulations or regulated as a separate industry, with its own regulator and laws?

Timothy Spangler, a US-based partner at law firm Dechert, believes it should be the former.

“I would rather spend more time understanding the technological impacts than creating new regulators, new crimes and new oversight mechanisms, and then having to debug those over years,” says Spangler. “That could unnecessarily stymie innovation.”

Others argue that the novelty of blockchain technology means it shouldn’t be shoe-horned into current regulations.

“Most regulators are using a traditional approach to regulate crypto,” says William Je, CEO of Hamilton Investment Management. “But crypto is creating new financial products that are entirely different to anything that has come before.”

Some jurisdictions are taking a more active pro-crypto stance to attract crypto businesses, such as US state Wyoming, which has passed a series of crypto-friendly blockchain laws.

“Wyoming has taken a descriptive rather than a prescriptive approach to regulation and is a model for other jurisdictions,” says Santori.

One initiative Wyoming has adopted is creating a banking license that tailors the regulatory regime to the actual risks of the bank. For instance, Kraken was the first crypto company to receive a license under the state’s new banking charter aimed at digital asset businesses, which allows them to take deposits as opposed to make loans.

“It dials up oversight of reserves and forgoes the regulations usually be required for banks that lend,” says Santori. 

This is the biggest hurdle for the development of crypto, so we need more clarity

A focus on crypto-mining activities, particularly around energy use, is also attracting the attention of regulators. China has banned crypto mining, while the EU considered banning certain energy-intensive methods for mining crypto but has since backed down. 

“To say that we need to regulate crypto miners is to say that crypto mining poses a danger, but we’re a long way from quantifying that,” says Spangler. “How comfortable are we that we accurately know the energy usage that miners engage in? Most of the academic surveys are qualified and speculative.”

While regulatory best practice is a work-in-progress, Spangler believes those jurisdictions that tread cautiously are likely to yield more effective long-term outcomes.

“We need to move at the right pace to make good decisions,” he says. “We want to move forward based on knowledge. Move slowly and roll out things as needed – we don’t know where blockchain will move.”

How regulators are addressing crypto across the world

But while the US has traditionally set the standard for global financial regulation, it is not a given that it will shape how crypto regulation develops worldwide.

“Most people would agree that crypto’s centre of gravity initially was the US and Canada, but there’s no reason why having created a new technology or protocol, they would also win the deployment,” says Spangler.

A lack of regulatory harmonisation across jurisdictions is also potentially weighing on the growth of the crypto market.

“Every country has different rules and regulations or even definitions of what should be regulated, so at the moment it’s not clear, which is holding back institutional investors from investing in crypto,” says Je. “This is the biggest hurdle for the development of crypto, so we need more clarity.”

Others believe that while regulation is necessary to safeguard consumers, it could slow the pace of adoption.

“It’s about getting the balance right – how do you protect people but enable this world to flourish,” says Richmond. “The concern is that if the regulation comes in too hard, it will slow down the uptake.”

Worries that too much regulation could choke innovation are likely to be overblown, though Santori believes some innovation will inevitably be constrained as regulators tighten their grip.

“That’s the trade-off when we regulate,” he says. “But we also create a more stable and welcoming environment, so that is the correct lens to view the decision of whether to regulate.”

As blockchain technology continues to thrive and new use cases emerge, one thing is certain: the regulatory backdrop is far from resolved.



The post Crypto’s rapid expansion leaves regulators rushing to keep pace appeared first on Raconteur.

]]>
What qualities should a good business leader show? https://www.raconteur.net/business-strategy/what-qualities-should-a-good-business-leader-show/ Wed, 17 Aug 2022 13:52:19 +0000 //www.raconteur.net/?p=157546 Jo Malone, co-founder and CEO, VetPartners, Ian Charlesworth, regional managing director, Awin, James Doyle, head of operations, Octopus Energy and Dawn Quigg, client services director, Awin were all rated in the top 10 for their senior management qualities

From the autocrat to the laissez-faire leader, there are many management styles executives can employ to get their team to perform. We turned to three of the top-rated companies for their senior leadership to find out which styles are the best


From left to right
Jo Malone, co-founder and CEO, VetPartners
Ian Charlesworth, regional managing director, Awin
James Doyle, head of operations, Octopus Energy
Dawn Quigg, client services director, Awin

The best leaders should be capable of setting their team’s direction and inspiring and motivating others to make that vision become a reality.

A good leader is a key driver for employee satisfaction, ranking only second to culture and values for UK workers, according to research from Glassdoor

Despite the importance of good senior leadership to an organisation’s success, it can be challenging to define the key qualities of a successful manager. 

Instead, Glassdoor’s Economic Research team decided to speak to the people they manage, to find out which companies have the best senior leadership teams

Here, four business leaders from three of the top-10 ranked companies share the secrets of their success and their advice for other executives on how to improve their leadership styles.



The post What qualities should a good business leader show? appeared first on Raconteur.

]]>
Jo Malone, co-founder and CEO, VetPartners, Ian Charlesworth, regional managing director, Awin, James Doyle, head of operations, Octopus Energy and Dawn Quigg, client services director, Awin were all rated in the top 10 for their senior management qualities

From the autocrat to the laissez-faire leader, there are many management styles executives can employ to get their team to perform. We turned to three of the top-rated companies for their senior leadership to find out which styles are the best


From left to right
Jo Malone, co-founder and CEO, VetPartners
Ian Charlesworth, regional managing director, Awin
James Doyle, head of operations, Octopus Energy
Dawn Quigg, client services director, Awin

The best leaders should be capable of setting their team’s direction and inspiring and motivating others to make that vision become a reality.

A good leader is a key driver for employee satisfaction, ranking only second to culture and values for UK workers, according to research from Glassdoor

Despite the importance of good senior leadership to an organisation’s success, it can be challenging to define the key qualities of a successful manager. 

Instead, Glassdoor’s Economic Research team decided to speak to the people they manage, to find out which companies have the best senior leadership teams

Here, four business leaders from three of the top-10 ranked companies share the secrets of their success and their advice for other executives on how to improve their leadership styles.



The post What qualities should a good business leader show? appeared first on Raconteur.

]]>
Is strong customer authentication working? https://www.raconteur.net/finance/strong-customer-authentication-working/ Tue, 16 Aug 2022 14:01:00 +0000 //www.raconteur.net/?p=157621

Entering a one-time password to complete an online transaction is now mandatory, so is strong customer authentication working? Or have fraudsters simply changed tactics?


Anyone who has shopped online recently will have already become accustomed to the extra step of having to receive and then use a one-time password (OTP) or log onto their mobile banking app to approve a purchase.

This strong customer authentication (SCA) step became mandatory in March, as ecommerce providers were obliged to ensure customers prove their identity through something they know (a password) and something they own (their mobile phone).

The measures were brought in because, according to figures from the banking and financial industries body, UK Finance, remote purchases accounted for four in five (79%) card fraud cases during 2021. By sending the legitimate customer a one-time password or asking them to log into a bank app, the hope is that fraud rates will drop. 

It will not be known how well the new measures are working until the end of the year, when UK Finance will publish fraud figures for 2022. However, Nationwide credited the technology with recording 2,000 fewer cases of fraud each month. Its research has shown that more than two in three customers, 68%, are happy to enter a texted passcode or, as the majority do, approve a payment in their banking app.

But not all companies within the industry are convinced. Tonia Luykx, VP at fraud detection business Sift, claims its figures show that, at the very least, criminals have simply changed tactics. Its network measures fraud across thousands of merchants and has seen a 41% rise in fraud attempts since SCA was introduced. This, she says, is mainly down to criminals changing tactics and using stolen card credentials on goods under the £30 limit at which SCA protection becomes mandatory.

“SCA is definitely a step in the right direction but we’re seeing fraudsters adapt,” she says.

“They’re defrauding sites by making lots of fraudulent payment attempts under SCA’s minimal payment level and then, for larger payments, they are taking over accounts so they are sent a password to complete a transaction.”

Fraudsters take over accounts by tricking people into passing on their email address and password, typically through phishing, or by duping a network into thinking a person is changing SIM cards and so needs messages sent to a new number. This new number is owned by a fraudster who will then pick up any one-time passwords without the victim knowing. 

SCA is definitely a step in the right direction but we’re seeing fraudsters adapt

Neil Downing, VP of products at TMT Analysis, reveals there has been an uplift in fraudsters using tactics such as SIM swap to circumvent SCA’s protections. Without detection technology, this fraud can be hard to spot because so many people are legitimately changing numbers that the deception continues until the victim spots unexpected charges on their accounts. 

“As an industry we see exploits against SMS vulnerabilities are on the rise, either through SIM-swapping or SIM-jacking to intercept a message, or telephony-based social engineering fraud to trick the victim into divulging the SMS one-time passcode and circumvent the security,” he says.

“However, although the industry is seeing significant growth in attacks against SCA, the risk of fraud from a reliance on password-only security is substantially greater. The humble SMS OTP is better than no SCA by orders of magnitude.” 

While security businesses commonly agree SCA is a welcome step in the right direction, there are plenty of experts who will point out the extra ‘friction’ in making a payment is having a negative impact on ecommerce. When there is an extra step to go through, consumers may think again about an impulse purchase, and many may not have a phone at their side to approve a sale.

Research from open banking payments platform, Nuapay, reveals 99% of merchants have seen at least a 5% rise in declined payments since SCA was brought in. The average rate of increase in payments not being completed is 37%. While this figure will include payments declined because of insufficient funds, Nuapay’s CEO Brian Hanrahan believes because this has always been the case, most of the rise is likely down to SCA. It is a welcome addition in the battle against fraud, he maintains, but it has had a major impact on retailers because of how it had to be implemented.

“The problem is that cards are decades old and they’re being used online, so payment providers have to put sticking plaster on them, like texted one-time-passwords, to try to make them safer,” he says. 

“That’s why we expect merchants will start using technology to allow direct payments from bank accounts because they have security built in, just by the person logging on.” 

The payments industry will not be able to say for sure whether SCA has reduced card-not-present fraud until the end of the year. It is fair to say that the tactics used to circumvent its measures were already in use to take over accounts to make fraudulent payments. They grew in popularity during the pandemic as more people started to shop online. Many were new to digital channels and the phishing methods used by criminals, making account takeover far easier. 

When 2022 fraud figures are released, industry experts believe they will likely show SCA has caused criminals to switch to lower-value fraud, meaning the number of cases may be up but individual sums involved will be down. For higher value fraud, fraudsters will likely continue to rely on phishing and social engineering tactics to trick people into passing on log-in details so their online accounts can be taken over. As ever, technology can only do so much. The biggest risk in the security chain is often the customer.



The post Is strong customer authentication working? appeared first on Raconteur.

]]>

Entering a one-time password to complete an online transaction is now mandatory, so is strong customer authentication working? Or have fraudsters simply changed tactics?


Anyone who has shopped online recently will have already become accustomed to the extra step of having to receive and then use a one-time password (OTP) or log onto their mobile banking app to approve a purchase.

This strong customer authentication (SCA) step became mandatory in March, as ecommerce providers were obliged to ensure customers prove their identity through something they know (a password) and something they own (their mobile phone).

The measures were brought in because, according to figures from the banking and financial industries body, UK Finance, remote purchases accounted for four in five (79%) card fraud cases during 2021. By sending the legitimate customer a one-time password or asking them to log into a bank app, the hope is that fraud rates will drop. 

It will not be known how well the new measures are working until the end of the year, when UK Finance will publish fraud figures for 2022. However, Nationwide credited the technology with recording 2,000 fewer cases of fraud each month. Its research has shown that more than two in three customers, 68%, are happy to enter a texted passcode or, as the majority do, approve a payment in their banking app.

But not all companies within the industry are convinced. Tonia Luykx, VP at fraud detection business Sift, claims its figures show that, at the very least, criminals have simply changed tactics. Its network measures fraud across thousands of merchants and has seen a 41% rise in fraud attempts since SCA was introduced. This, she says, is mainly down to criminals changing tactics and using stolen card credentials on goods under the £30 limit at which SCA protection becomes mandatory.

“SCA is definitely a step in the right direction but we’re seeing fraudsters adapt,” she says.

“They’re defrauding sites by making lots of fraudulent payment attempts under SCA’s minimal payment level and then, for larger payments, they are taking over accounts so they are sent a password to complete a transaction.”

Fraudsters take over accounts by tricking people into passing on their email address and password, typically through phishing, or by duping a network into thinking a person is changing SIM cards and so needs messages sent to a new number. This new number is owned by a fraudster who will then pick up any one-time passwords without the victim knowing. 

SCA is definitely a step in the right direction but we’re seeing fraudsters adapt

Neil Downing, VP of products at TMT Analysis, reveals there has been an uplift in fraudsters using tactics such as SIM swap to circumvent SCA’s protections. Without detection technology, this fraud can be hard to spot because so many people are legitimately changing numbers that the deception continues until the victim spots unexpected charges on their accounts. 

“As an industry we see exploits against SMS vulnerabilities are on the rise, either through SIM-swapping or SIM-jacking to intercept a message, or telephony-based social engineering fraud to trick the victim into divulging the SMS one-time passcode and circumvent the security,” he says.

“However, although the industry is seeing significant growth in attacks against SCA, the risk of fraud from a reliance on password-only security is substantially greater. The humble SMS OTP is better than no SCA by orders of magnitude.” 

While security businesses commonly agree SCA is a welcome step in the right direction, there are plenty of experts who will point out the extra ‘friction’ in making a payment is having a negative impact on ecommerce. When there is an extra step to go through, consumers may think again about an impulse purchase, and many may not have a phone at their side to approve a sale.

Research from open banking payments platform, Nuapay, reveals 99% of merchants have seen at least a 5% rise in declined payments since SCA was brought in. The average rate of increase in payments not being completed is 37%. While this figure will include payments declined because of insufficient funds, Nuapay’s CEO Brian Hanrahan believes because this has always been the case, most of the rise is likely down to SCA. It is a welcome addition in the battle against fraud, he maintains, but it has had a major impact on retailers because of how it had to be implemented.

“The problem is that cards are decades old and they’re being used online, so payment providers have to put sticking plaster on them, like texted one-time-passwords, to try to make them safer,” he says. 

“That’s why we expect merchants will start using technology to allow direct payments from bank accounts because they have security built in, just by the person logging on.” 

The payments industry will not be able to say for sure whether SCA has reduced card-not-present fraud until the end of the year. It is fair to say that the tactics used to circumvent its measures were already in use to take over accounts to make fraudulent payments. They grew in popularity during the pandemic as more people started to shop online. Many were new to digital channels and the phishing methods used by criminals, making account takeover far easier. 

When 2022 fraud figures are released, industry experts believe they will likely show SCA has caused criminals to switch to lower-value fraud, meaning the number of cases may be up but individual sums involved will be down. For higher value fraud, fraudsters will likely continue to rely on phishing and social engineering tactics to trick people into passing on log-in details so their online accounts can be taken over. As ever, technology can only do so much. The biggest risk in the security chain is often the customer.



The post Is strong customer authentication working? appeared first on Raconteur.

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Why aerial tramways are key to sustainable city transport systems https://www.raconteur.net/sustainability/aerial-tramways-are-key-to-sustainable-city-transport-systems/ Tue, 16 Aug 2022 12:00:00 +0000 //www.raconteur.net/?p=157613

With urban areas set to boom, cable-car systems are a solution to reduce congestion sustainably


When the historian and critic Lewis Mumford said that adding car lanes to deal with traffic congestion was like loosening your belt to cure obesity, his sardonic advice was rarely heeded. Traffic remains one of those facts of life: dirty, congested, rage-inducing, inevitable.

But picture for a moment the last time you were stuck in traffic – gritting your teeth, trapped in your car – and imagine instead you were sailing above it, getting from A to B in half the time of that miserable drive.

That may soon be a reality for Parisians where, from the south-east of the city through to the hilly suburbs of Créteil, 10,000 passengers a day will be able to use a transit line with a difference: rather than by tram, rail or road, this route will be suspended in the air – via a new 4.5km aerial tramway, the Câble 1 (C1), set to open in 2025.

First proposed in 2008, construction begins this year – connecting Paris’s populous south-east suburbs to the Métro Line 8 station, delivering passengers into the city in just 17 minutes.

Faced with a challenging, hilly environment and much of the region’s ground-level space already accounted for – whether by criss-crossing highways or high-speed rail – Paris decided to build upwards. The cable car route is being built with universal accessibility in mind, and despite the soaring mode of transit, will be boarded at the ground floor level – with no need for stairs, escalators, or elevators.

“We are convinced of the importance of the cable car in an urban environment in comparison with other modes of transportation,” Lucie Coursaget at Atelier Schall, which is designing the Émile-Combes station for the new line. “They’re more economical, eco-friendly, 100% electrical, faster to build – and they’re a pleasing means of urban transport for passengers.”

Unlike the significant investment costs and planning headaches associated with transport infrastructure, building aerial tramways is relatively painless, according to Innovation Seilbahn author Frieder Kremer.

“You don’t have to build roads or dig tunnels, you just need the columns,” he explains. “There’s no requirement for a lot of large infrastructure. And if it doesn’t work, it’s easy to remove and rebuild them.”

Cable cars are generally associated with tourists ascending ski slopes, but aerial tramways have become a buzzy topic of conversation among urban planners in recent years. As well as Paris, projects are underway in Lagos, Nigeria, Dominica in the Caribbean, and Dubai, joining existing networks like those serving Ankara, Turkey, Constantine, Algeria, Caracas, Venezuela, Medellín, Colombia, and La Paz, in Bolivia.

In Medellín and La Paz, these Teleféricos are integrated with the city’s existing public transport networks, and ferry 30,000 and 90,000 passengers daily. The outer reaches of these metropolises – both located in valleys within the Andes – were traditionally difficult for locals to travel to and from. With these aerial transit systems in place, previously disconnected residents were, all of a sudden, able to access the beating heart of their cities – affording much-needed opportunities and allowing them to more easily take part in civic life.

Our cities are set to swell, with some projections forecasting that 68% of the world population will live in cities by 2050 and by 2030, 10 new cities will reach megacity status, where populations topple the 10 million mark. Mobility then becomes an increasingly pressing question.

This growth poses a challenge for cities new and old. As urban sprawl spreads and traditional road or rail networks become pollutant-spewing bottlenecks, commute times become unmanageable and quality of life suffers. Meanwhile, retrofitting or expanding existing infrastructure in older cities often proves complicated and expensive.

Cable cars are more economical, eco-friendly, 100% electrical, faster to build – and they’re a pleasing means of urban transport for passengers

“What happens in most cities is that congestion levels establish themselves at equilibrium level, that is, the limit of what's bearable for people,” says Alexandre Bayen, former director of the Institute of Transportation Studies at the University of Berkeley and co-author of the Oliver Wyman Urban Mobility.

Without proper regulation and careful master planning, these choke points of congestion can spiral out of control. When that happens, cities need to relieve the pressure.

Aerial tramways could be one method to manage this congestion. For example – and this is a back-of-the-envelope calculation, says Bayen – a cable car with one cabin arriving every 10 seconds or so, capable of carrying six people, could roughly mirror a single lane of a regular highway at capacity.

“It’s not a crazy solution for decongestion, as long as it’s for very specific local use,” Bayen says. “They’re one way to do demand management – but you need to find the right origin-destination pairs, where they make sense.”

Kremer discovered that, provided they don’t exceed distances of 7km, aerial tramways are incredibly efficient – anything further, and railways are better. And because they are purely electrical systems, they have the lowest emissions of any other form of mechanised transport. Compared to 1.45g per passenger kilometre in cars, a cable car system measures in at just 0.01g – beating even rail, at 0.02g.

In fact, says Daniel F Morris, clean energy lead at Climate Investment Funds – which is supporting a new aerial tramway in Lagos, Nigeria, connecting Lagos Island to Victoria Island – provided an area’s energy system is relatively clean, cable cars essentially plug right into the grid.

“You don’t have to worry about burning diesel,” he says. “And electrification, I think, is going to be one of the main ways you see the world decarbonising over the next decade or two.”

So if they’re energy-efficient and convenient, why aren’t our skylines crowded with silhouettes of intersecting cable cars? One possible reason is as simple as public perception, adds Kremer. Because most of us think of cable cars as gimmicky forms of transport relegated to scenic holiday views, they’ve rarely been considered a genuinely useful form of urban mobility.

Additionally, while people think cable cars are only useful for crossing obstacles, this isn’t the case, Kremer adds. “If you have two points that should be connected, it doesn't matter if there are houses underneath or a park or a river. It isn’t a requirement to have physical obstacles in the way.”

Paris’s C1 project, though, may help to change these perceptions.

For a long time, urban cable cars have been associated with problems of altitudes, explains Coursaget. “Cable cars allow much more than serving territories with different altitudes, it allows us to cross rivers, highways, railway lines. Entire neighbourhoods can be opened up in record time, whereas until now, vehicles, buses and tramways were forced to take long, tedious detours.”

While it’s unlikely that our future megacities will resemble a sci-fi skyline of bisecting aerial trams, Bayen notes that these systems could be one effective way to alleviate mobility pressure in urban areas.

“It’s not a patch, but something that can improve connectivity on a surgical basis, as long as there’s economic viability to it,” he said. Like home-working, micro-mobility and the extension of tram and rail networks, cable cars could play an important role in providing a bit of extra breathing space in our progressively crowded cities.

Nearly 400 years since Dutch engineer Adam Wybe built the first functioning cable car on multiple supports in Gdansk, it seems these contraptions may finally lift off – connecting hard-to-reach spots within cities, plugging gaps in existing systems, and at a fraction of the emissions costs.



The post Why aerial tramways are key to sustainable city transport systems appeared first on Raconteur.

]]>

With urban areas set to boom, cable-car systems are a solution to reduce congestion sustainably


When the historian and critic Lewis Mumford said that adding car lanes to deal with traffic congestion was like loosening your belt to cure obesity, his sardonic advice was rarely heeded. Traffic remains one of those facts of life: dirty, congested, rage-inducing, inevitable.

But picture for a moment the last time you were stuck in traffic – gritting your teeth, trapped in your car – and imagine instead you were sailing above it, getting from A to B in half the time of that miserable drive.

That may soon be a reality for Parisians where, from the south-east of the city through to the hilly suburbs of Créteil, 10,000 passengers a day will be able to use a transit line with a difference: rather than by tram, rail or road, this route will be suspended in the air – via a new 4.5km aerial tramway, the Câble 1 (C1), set to open in 2025.

First proposed in 2008, construction begins this year – connecting Paris’s populous south-east suburbs to the Métro Line 8 station, delivering passengers into the city in just 17 minutes.

Faced with a challenging, hilly environment and much of the region’s ground-level space already accounted for – whether by criss-crossing highways or high-speed rail – Paris decided to build upwards. The cable car route is being built with universal accessibility in mind, and despite the soaring mode of transit, will be boarded at the ground floor level – with no need for stairs, escalators, or elevators.

“We are convinced of the importance of the cable car in an urban environment in comparison with other modes of transportation,” Lucie Coursaget at Atelier Schall, which is designing the Émile-Combes station for the new line. “They’re more economical, eco-friendly, 100% electrical, faster to build – and they’re a pleasing means of urban transport for passengers.”

Unlike the significant investment costs and planning headaches associated with transport infrastructure, building aerial tramways is relatively painless, according to Innovation Seilbahn author Frieder Kremer.

“You don’t have to build roads or dig tunnels, you just need the columns,” he explains. “There’s no requirement for a lot of large infrastructure. And if it doesn’t work, it’s easy to remove and rebuild them.”

Cable cars are generally associated with tourists ascending ski slopes, but aerial tramways have become a buzzy topic of conversation among urban planners in recent years. As well as Paris, projects are underway in Lagos, Nigeria, Dominica in the Caribbean, and Dubai, joining existing networks like those serving Ankara, Turkey, Constantine, Algeria, Caracas, Venezuela, Medellín, Colombia, and La Paz, in Bolivia.

In Medellín and La Paz, these Teleféricos are integrated with the city’s existing public transport networks, and ferry 30,000 and 90,000 passengers daily. The outer reaches of these metropolises – both located in valleys within the Andes – were traditionally difficult for locals to travel to and from. With these aerial transit systems in place, previously disconnected residents were, all of a sudden, able to access the beating heart of their cities – affording much-needed opportunities and allowing them to more easily take part in civic life.

Our cities are set to swell, with some projections forecasting that 68% of the world population will live in cities by 2050 and by 2030, 10 new cities will reach megacity status, where populations topple the 10 million mark. Mobility then becomes an increasingly pressing question.

This growth poses a challenge for cities new and old. As urban sprawl spreads and traditional road or rail networks become pollutant-spewing bottlenecks, commute times become unmanageable and quality of life suffers. Meanwhile, retrofitting or expanding existing infrastructure in older cities often proves complicated and expensive.

Cable cars are more economical, eco-friendly, 100% electrical, faster to build – and they’re a pleasing means of urban transport for passengers

“What happens in most cities is that congestion levels establish themselves at equilibrium level, that is, the limit of what's bearable for people,” says Alexandre Bayen, former director of the Institute of Transportation Studies at the University of Berkeley and co-author of the Oliver Wyman Urban Mobility.

Without proper regulation and careful master planning, these choke points of congestion can spiral out of control. When that happens, cities need to relieve the pressure.

Aerial tramways could be one method to manage this congestion. For example – and this is a back-of-the-envelope calculation, says Bayen – a cable car with one cabin arriving every 10 seconds or so, capable of carrying six people, could roughly mirror a single lane of a regular highway at capacity.

“It’s not a crazy solution for decongestion, as long as it’s for very specific local use,” Bayen says. “They’re one way to do demand management – but you need to find the right origin-destination pairs, where they make sense.”

Kremer discovered that, provided they don’t exceed distances of 7km, aerial tramways are incredibly efficient – anything further, and railways are better. And because they are purely electrical systems, they have the lowest emissions of any other form of mechanised transport. Compared to 1.45g per passenger kilometre in cars, a cable car system measures in at just 0.01g – beating even rail, at 0.02g.

In fact, says Daniel F Morris, clean energy lead at Climate Investment Funds – which is supporting a new aerial tramway in Lagos, Nigeria, connecting Lagos Island to Victoria Island – provided an area’s energy system is relatively clean, cable cars essentially plug right into the grid.

“You don’t have to worry about burning diesel,” he says. “And electrification, I think, is going to be one of the main ways you see the world decarbonising over the next decade or two.”

So if they’re energy-efficient and convenient, why aren’t our skylines crowded with silhouettes of intersecting cable cars? One possible reason is as simple as public perception, adds Kremer. Because most of us think of cable cars as gimmicky forms of transport relegated to scenic holiday views, they’ve rarely been considered a genuinely useful form of urban mobility.

Additionally, while people think cable cars are only useful for crossing obstacles, this isn’t the case, Kremer adds. “If you have two points that should be connected, it doesn't matter if there are houses underneath or a park or a river. It isn’t a requirement to have physical obstacles in the way.”

Paris’s C1 project, though, may help to change these perceptions.

For a long time, urban cable cars have been associated with problems of altitudes, explains Coursaget. “Cable cars allow much more than serving territories with different altitudes, it allows us to cross rivers, highways, railway lines. Entire neighbourhoods can be opened up in record time, whereas until now, vehicles, buses and tramways were forced to take long, tedious detours.”

While it’s unlikely that our future megacities will resemble a sci-fi skyline of bisecting aerial trams, Bayen notes that these systems could be one effective way to alleviate mobility pressure in urban areas.

“It’s not a patch, but something that can improve connectivity on a surgical basis, as long as there’s economic viability to it,” he said. Like home-working, micro-mobility and the extension of tram and rail networks, cable cars could play an important role in providing a bit of extra breathing space in our progressively crowded cities.

Nearly 400 years since Dutch engineer Adam Wybe built the first functioning cable car on multiple supports in Gdansk, it seems these contraptions may finally lift off – connecting hard-to-reach spots within cities, plugging gaps in existing systems, and at a fraction of the emissions costs.



The post Why aerial tramways are key to sustainable city transport systems appeared first on Raconteur.

]]>
How the giants of British banking have kept their challengers at bay https://www.raconteur.net/finance/how-the-giants-of-british-banking-have-kept-their-challengers-at-bay/ Mon, 15 Aug 2022 15:23:36 +0000 //www.raconteur.net/?p=157596 City of London banks

In the mid-2010s, a wave of subversive challengers vowed to overthrow banking’s old guard, but the incumbents have stood remarkably firm against the fintech-fuelled revolution – so far, at least


The French revolution took a while to get going in earnest. After the storming of the Bastille kicked off proceedings in 1789, it was three years before the guillotine entered service. Then things really accelerated: Louis XVI lost his palace, then his head, and Maximilien Robespierre’s reign of terror ensued – until the radical-in-chief got the chop himself in 1794.

How safe are members of the UK’s banking establishment from the much-trumpeted fintech revolution? Just a few years ago, the outlook for these venerable incumbents was looking decidedly unsettled. Upstart startups such as Atom, Monzo, Starling and Tandem were aiming not only to compete with them, but to beat them. 

Even the normally understated Deloitte was warning that the big high-street players would struggle to shrug off this threat to their dominance, as they’d done so many times before. In its 2014 research report, Banking Disrupted, the firm’s banking leader in the UK, Zahir Bokhari, wrote: “Deloitte sees this time as being truly different. Banks’ core competitive advantages over new entrants are being eroded.” 

In 2018, Nikolay Storonsky, co-founder and CEO of the aptly named Revolut, was bullishly predicting the end of the old order. 

“In the next five to 10 years we won’t see as many banks,” he declared. “We’ll see a few global players, in the same way that Google and Facebook dominate advertising.”

And today? The challengers’ cris de guerre have faded and calm is returning. The high-street banks have fended off the initial attack and no ramparts have been breached. 

Lloyds Bank, for instance, recorded a pre-tax profit of £6.9bn last year. By contrast, Monzo posted a loss of nearly £115m. Starling, a solid performer in the business sector, made a profit of £32m for the year ending March 2022 and recently raised funds at a £2.5bn valuation. These are respectable numbers for a well-regarded enterprise, but they’re still dwarfed by those of the high-street behemoths. Even the fusty old NatWest Group, bailed out by the taxpayer during the financial crisis of 2007-08, is still valued at about £24bn.

“All the big banks are still alive, well and posting healthy profits,” says Charles McManus, the CEO of ClearBank, which he founded in 2015. “They have certainly weathered the first fintech storm to a large degree.”

A symbiotic relationship

They have done so mainly by modernising, he adds. They’ve updated software, launched apps and collaborated, rather than competed, with emerging fintech providers. 

McManus notes that several fintech firms have engaged in “symbiotic relationships with banks rather than eating their lunch. They filled technology gaps for banks, while banks became major buyers and distributors of fintech.”

HSBC, for instance, has signed an anti-money-laundering contract with Polish fintech company Silent Eight. The bank is a serial investor in fintech startups and runs an accelerator for them. Under the bonnet, HSBC applies the same software principles as a fintech firm. Last year it signed a multi-year deal to work with CloudBees, a specialist in continuous software delivery – a serious improvement on the big-bang IT upgrade model that’s been common in the banking industry for decades.

This June, the bank announced the creation of “fintech 101”, a course run by the University of Oxford’s Saïd Business School to give its staff a thorough grounding in the sector and its latest developments. 

But McManus points out that most high-street incumbents, despite having integrated fintech into many of their services, do still face a significant technological threat. 

“At their core, they’re still running on legacy systems,” he says. “So, while they have weathered the storm so far, there is a major question mark over whether they can continue doing that.”

The interesting battle is whether the smart banks get big before the big banks get smart

Consider the impressive growth in the number of new customers that some challengers have been attracting, suggests McManus, who adds: “The likes of Monzo boast millions of customers already and they’re only continuing to grow. Thousands of people are flocking to open accounts with them each month.”

His assessment chimes with that of Michael Mueller, the founder and CEO of Form3, a specialist in payment processing. Established in 2016, his company has attracted clients ranging from Lloyds to German challenger bank N26. 

“The interesting battle is whether the smart banks get big before the big banks get smart,” Mueller says. “At the moment, the tier-one banks are probably in a stronger position than they have been in the past six or seven years. Some of that has to do with the rise in interest rates – big banks like them high. A lot has to do with the fact that they’ve started their transition to better technology, although that process is far from complete.”

Investing in fintech

There’s also the fact that the incumbents have invested in challengers, he adds. “If you look at Chase by JP Morgan in the UK or Goldman Sachs’ Marcus, there are some really interesting projects in that area.”

The high-street banks not only have scale on their side. While some income streams will have dwindled during the pandemic, the sheer breadth of their offerings – from commercial loans to life insurance – has spread their risk and enabled them to keep turning in decent results. 

Nonetheless, the competition isn’t going away. The challengers will reflect, learn, improve and return. New ones will emerge. 

It’s a prospect that McManus relishes. He points to Bank North, which secured a banking licence in August 2021. Part of a new wave of regionally focused lenders, the business is “myopically focused on supporting consumers in the north. In times of economic uncertainty, we may find that customers look to banks that are built to solve their specific problems, rather than the more generalist bigger players.”

The longer-term outcome is far from obvious, according to McManus, who adds: “While traditional banks may make some gains in the current economic storm, the big question is whether they’ll be equipped for what comes after.”

The French revolution took 10-and-a-half years to play out. Inevitably, over such a long process, there were lulls in the action, but these would always be followed by periods of great upheaval. The high-street banks may well be sitting pretty today, but it’s distinctly possible that a second act is in store.



The post How the giants of British banking have kept their challengers at bay appeared first on Raconteur.

]]>
City of London banks

In the mid-2010s, a wave of subversive challengers vowed to overthrow banking’s old guard, but the incumbents have stood remarkably firm against the fintech-fuelled revolution – so far, at least


The French revolution took a while to get going in earnest. After the storming of the Bastille kicked off proceedings in 1789, it was three years before the guillotine entered service. Then things really accelerated: Louis XVI lost his palace, then his head, and Maximilien Robespierre’s reign of terror ensued – until the radical-in-chief got the chop himself in 1794.

How safe are members of the UK’s banking establishment from the much-trumpeted fintech revolution? Just a few years ago, the outlook for these venerable incumbents was looking decidedly unsettled. Upstart startups such as Atom, Monzo, Starling and Tandem were aiming not only to compete with them, but to beat them. 

Even the normally understated Deloitte was warning that the big high-street players would struggle to shrug off this threat to their dominance, as they’d done so many times before. In its 2014 research report, Banking Disrupted, the firm’s banking leader in the UK, Zahir Bokhari, wrote: “Deloitte sees this time as being truly different. Banks’ core competitive advantages over new entrants are being eroded.” 

In 2018, Nikolay Storonsky, co-founder and CEO of the aptly named Revolut, was bullishly predicting the end of the old order. 

“In the next five to 10 years we won’t see as many banks,” he declared. “We’ll see a few global players, in the same way that Google and Facebook dominate advertising.”

And today? The challengers’ cris de guerre have faded and calm is returning. The high-street banks have fended off the initial attack and no ramparts have been breached. 

Lloyds Bank, for instance, recorded a pre-tax profit of £6.9bn last year. By contrast, Monzo posted a loss of nearly £115m. Starling, a solid performer in the business sector, made a profit of £32m for the year ending March 2022 and recently raised funds at a £2.5bn valuation. These are respectable numbers for a well-regarded enterprise, but they’re still dwarfed by those of the high-street behemoths. Even the fusty old NatWest Group, bailed out by the taxpayer during the financial crisis of 2007-08, is still valued at about £24bn.

“All the big banks are still alive, well and posting healthy profits,” says Charles McManus, the CEO of ClearBank, which he founded in 2015. “They have certainly weathered the first fintech storm to a large degree.”

A symbiotic relationship

They have done so mainly by modernising, he adds. They’ve updated software, launched apps and collaborated, rather than competed, with emerging fintech providers. 

McManus notes that several fintech firms have engaged in “symbiotic relationships with banks rather than eating their lunch. They filled technology gaps for banks, while banks became major buyers and distributors of fintech.”

HSBC, for instance, has signed an anti-money-laundering contract with Polish fintech company Silent Eight. The bank is a serial investor in fintech startups and runs an accelerator for them. Under the bonnet, HSBC applies the same software principles as a fintech firm. Last year it signed a multi-year deal to work with CloudBees, a specialist in continuous software delivery – a serious improvement on the big-bang IT upgrade model that’s been common in the banking industry for decades.

This June, the bank announced the creation of “fintech 101”, a course run by the University of Oxford’s Saïd Business School to give its staff a thorough grounding in the sector and its latest developments. 

But McManus points out that most high-street incumbents, despite having integrated fintech into many of their services, do still face a significant technological threat. 

“At their core, they’re still running on legacy systems,” he says. “So, while they have weathered the storm so far, there is a major question mark over whether they can continue doing that.”

The interesting battle is whether the smart banks get big before the big banks get smart

Consider the impressive growth in the number of new customers that some challengers have been attracting, suggests McManus, who adds: “The likes of Monzo boast millions of customers already and they’re only continuing to grow. Thousands of people are flocking to open accounts with them each month.”

His assessment chimes with that of Michael Mueller, the founder and CEO of Form3, a specialist in payment processing. Established in 2016, his company has attracted clients ranging from Lloyds to German challenger bank N26. 

“The interesting battle is whether the smart banks get big before the big banks get smart,” Mueller says. “At the moment, the tier-one banks are probably in a stronger position than they have been in the past six or seven years. Some of that has to do with the rise in interest rates – big banks like them high. A lot has to do with the fact that they’ve started their transition to better technology, although that process is far from complete.”

Investing in fintech

There’s also the fact that the incumbents have invested in challengers, he adds. “If you look at Chase by JP Morgan in the UK or Goldman Sachs’ Marcus, there are some really interesting projects in that area.”

The high-street banks not only have scale on their side. While some income streams will have dwindled during the pandemic, the sheer breadth of their offerings – from commercial loans to life insurance – has spread their risk and enabled them to keep turning in decent results. 

Nonetheless, the competition isn’t going away. The challengers will reflect, learn, improve and return. New ones will emerge. 

It’s a prospect that McManus relishes. He points to Bank North, which secured a banking licence in August 2021. Part of a new wave of regionally focused lenders, the business is “myopically focused on supporting consumers in the north. In times of economic uncertainty, we may find that customers look to banks that are built to solve their specific problems, rather than the more generalist bigger players.”

The longer-term outcome is far from obvious, according to McManus, who adds: “While traditional banks may make some gains in the current economic storm, the big question is whether they’ll be equipped for what comes after.”

The French revolution took 10-and-a-half years to play out. Inevitably, over such a long process, there were lulls in the action, but these would always be followed by periods of great upheaval. The high-street banks may well be sitting pretty today, but it’s distinctly possible that a second act is in store.



The post How the giants of British banking have kept their challengers at bay appeared first on Raconteur.

]]>
What is it like to live and work in Dublin? https://www.raconteur.net/global-business/what-is-it-like-to-live-and-work-in-dublin/ Mon, 15 Aug 2022 14:44:55 +0000 //www.raconteur.net/?p=157574 Animated Dublin city scene

With many large organisations relocating their European headquarters to the Irish capital, what can expats expect when moving to Dublin?


Dublin is a popular choice among major organisations for their European headquarters and that makes it a likely destination for internationals to live and work

The Irish capital was recently judged the most popular location for financial services firms to locate their EU offices. Figures from EY show that 36 financial services companies have announced their intention to relocate UK operations and/or staff to Dublin, since the Brexit referendum.

It is also home to the European headquarters of some of the largest global technology companies, including Microsoft, Google and Meta. The fast-growing social media app TikTok is the latest to join, signing a long-term lease to rent 210,000sq ft of office space in the city’s south docklands.

Why are companies moving to the Irish capital?

One of the most important factors driving companies to Dublin is Ireland’s business-friendly tax regime.

Corporation tax in the country stands at 12.5%, placing it among the lowest corporate tax rates in Europe. This compares favourably with its closest neighbour, the UK, which has a corporation tax rate of 19%. Companies based in Ireland can also benefit from a 25% tax credit on research and development.

As a tech hub Ireland has a wealth of talent, which helps it to punch above its weight when attracting companies such as LinkedIn and Apple to its shores. Enterprise Ireland estimates that the country has 80,000 tech professionals working in the industry, with Dublin’s Silicon Docks at the centre of the Irish technology sector.

Software company Salesforce opened its first offices in Dublin in 2001 and currently employs around 3,000 people there. Salesforce Tower Dublin, a new campus on the river Liffey, is scheduled to open later this year.

Explaining why Salesforce has such a large presence in Dublin, its senior director for employee success, Terri Moloney, says: “It has a strong reputation as the digital capital of Europe and the city is home to 16 of the top 20 global tech companies in the world. It attracts a lot of international talent and that makes the talent market dynamic; it’s certainly one of the top reasons businesses locate here.” 

What to expect when moving to Dublin

In common with other companies, Salesforce provides services and support to help employees with their relocation. And while a common concern is being able to speak the language of the target country, Moloney has good news on this point too: “There are 60 different nationalities in our offices and many different languages are spoken. You don’t have to have English, you can manage with limited language skills,” she says.

Dublin has a reputation as a welcoming city. According to the InterNations Expat Insider 2021 report, which surveys international citizens living in cities across the world, Dublin ranks sixth for local friendliness and 13th for ease of settling. 

Philip Kelly is employee engagement and communications lead at Irish energy firm ESB. He has lived in Dublin since 2010, and lived and worked in Cork, Sydney and Swansea across his career. “My favourite thing about Dublin is probably the people,” he says. “It’s a fun city and everyone’s very friendly, which makes it very easy to meet new people.” 

He adds that this social element is present across the city, with a culture that caters to all tastes, from quiet pubs to vibrant clubs, theatre, shopping and restaurants.

Moloney adds that there is a “small neighbourhood feel in the city, which is really attractive. It’s a pretty safe country, it’s very much a cultural centre and there are a lot of international people here. This makes it easy for a lot of people to come and live here.”

How Dublin work life has been affected by the pandemic

The Irish capital ranks third for work-life balance and first for local career prospects and job security, according to the InterNations survey. 

Speaking about his own company, Kelly says: “We work hard and everyone’s professional and tries to uphold the values of ESB but we have a social element as well.”

In this sense, he believes Dublin workers can strike a good balance. “Work is not the be all and end all,” he adds. “Rarely will you go to a party where people ask you what you do for a living. People put a lot into their work but it’s rarely their defining characteristic.”

The hybrid working model has proven to be very positive and is focused on the employee experience

The importance of this work-life balance was emphasised during the pandemic too and many offices have continued with hybrid working arrangements. Moloney says: “The hybrid working model has proven to be very positive and is focused on the employee experience. When you do come into the office, it’s about getting together with other team members or attending events.”

This social element of work is something that has made a welcome return now that Covid restrictions have been lifted. “Business is done in our coffee docks as much as in our boardrooms,” Kelly adds. “It’s something that we’ve been missing during the pandemic – it’s hard to schedule a virtual call for a chat. People missed those human interactions, and I think that’s what we’re getting back to now.”

Is it expensive to live in Dublin?

Dublin is among the most expensive cities to live in the world, coming joint 19th in the Economist Intelligence Unit’s Worldwide Cost of Living index, alongside Frankfurt and Shanghai. This places the Irish capital just below London when comparing the costs of goods and services in each city.

This fact isn’t lost on expats, with 93% of Dublin-based internationals listing ‘expensive’ as the main characteristic of the city, according to Dublin's Global Reputation report by the Dublin Chamber. 

One of the main contributors to this is the cost of housing. The average property price in Dublin is €509,575 (£436,530), while renters living in the city centre can expect to pay €1,834 (£1,571) per month on average. 

This is reflected in the Expat Insider 2021 report, in which Dublin came last for finance and housing for the fourth year running, mostly because of high housing costs and the local cost of living.

You can read more from our Working Around the World series here.



The post What is it like to live and work in Dublin? appeared first on Raconteur.

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Animated Dublin city scene

With many large organisations relocating their European headquarters to the Irish capital, what can expats expect when moving to Dublin?


Dublin is a popular choice among major organisations for their European headquarters and that makes it a likely destination for internationals to live and work

The Irish capital was recently judged the most popular location for financial services firms to locate their EU offices. Figures from EY show that 36 financial services companies have announced their intention to relocate UK operations and/or staff to Dublin, since the Brexit referendum.

It is also home to the European headquarters of some of the largest global technology companies, including Microsoft, Google and Meta. The fast-growing social media app TikTok is the latest to join, signing a long-term lease to rent 210,000sq ft of office space in the city’s south docklands.

Why are companies moving to the Irish capital?

One of the most important factors driving companies to Dublin is Ireland’s business-friendly tax regime.

Corporation tax in the country stands at 12.5%, placing it among the lowest corporate tax rates in Europe. This compares favourably with its closest neighbour, the UK, which has a corporation tax rate of 19%. Companies based in Ireland can also benefit from a 25% tax credit on research and development.

As a tech hub Ireland has a wealth of talent, which helps it to punch above its weight when attracting companies such as LinkedIn and Apple to its shores. Enterprise Ireland estimates that the country has 80,000 tech professionals working in the industry, with Dublin’s Silicon Docks at the centre of the Irish technology sector.

Software company Salesforce opened its first offices in Dublin in 2001 and currently employs around 3,000 people there. Salesforce Tower Dublin, a new campus on the river Liffey, is scheduled to open later this year.

Explaining why Salesforce has such a large presence in Dublin, its senior director for employee success, Terri Moloney, says: “It has a strong reputation as the digital capital of Europe and the city is home to 16 of the top 20 global tech companies in the world. It attracts a lot of international talent and that makes the talent market dynamic; it’s certainly one of the top reasons businesses locate here.” 

What to expect when moving to Dublin

In common with other companies, Salesforce provides services and support to help employees with their relocation. And while a common concern is being able to speak the language of the target country, Moloney has good news on this point too: “There are 60 different nationalities in our offices and many different languages are spoken. You don’t have to have English, you can manage with limited language skills,” she says.

Dublin has a reputation as a welcoming city. According to the InterNations Expat Insider 2021 report, which surveys international citizens living in cities across the world, Dublin ranks sixth for local friendliness and 13th for ease of settling. 

Philip Kelly is employee engagement and communications lead at Irish energy firm ESB. He has lived in Dublin since 2010, and lived and worked in Cork, Sydney and Swansea across his career. “My favourite thing about Dublin is probably the people,” he says. “It’s a fun city and everyone’s very friendly, which makes it very easy to meet new people.” 

He adds that this social element is present across the city, with a culture that caters to all tastes, from quiet pubs to vibrant clubs, theatre, shopping and restaurants.

Moloney adds that there is a “small neighbourhood feel in the city, which is really attractive. It’s a pretty safe country, it’s very much a cultural centre and there are a lot of international people here. This makes it easy for a lot of people to come and live here.”

How Dublin work life has been affected by the pandemic

The Irish capital ranks third for work-life balance and first for local career prospects and job security, according to the InterNations survey. 

Speaking about his own company, Kelly says: “We work hard and everyone’s professional and tries to uphold the values of ESB but we have a social element as well.”

In this sense, he believes Dublin workers can strike a good balance. “Work is not the be all and end all,” he adds. “Rarely will you go to a party where people ask you what you do for a living. People put a lot into their work but it’s rarely their defining characteristic.”

The hybrid working model has proven to be very positive and is focused on the employee experience

The importance of this work-life balance was emphasised during the pandemic too and many offices have continued with hybrid working arrangements. Moloney says: “The hybrid working model has proven to be very positive and is focused on the employee experience. When you do come into the office, it’s about getting together with other team members or attending events.”

This social element of work is something that has made a welcome return now that Covid restrictions have been lifted. “Business is done in our coffee docks as much as in our boardrooms,” Kelly adds. “It’s something that we’ve been missing during the pandemic – it’s hard to schedule a virtual call for a chat. People missed those human interactions, and I think that’s what we’re getting back to now.”

Is it expensive to live in Dublin?

Dublin is among the most expensive cities to live in the world, coming joint 19th in the Economist Intelligence Unit’s Worldwide Cost of Living index, alongside Frankfurt and Shanghai. This places the Irish capital just below London when comparing the costs of goods and services in each city.

This fact isn’t lost on expats, with 93% of Dublin-based internationals listing ‘expensive’ as the main characteristic of the city, according to Dublin's Global Reputation report by the Dublin Chamber. 

One of the main contributors to this is the cost of housing. The average property price in Dublin is €509,575 (£436,530), while renters living in the city centre can expect to pay €1,834 (£1,571) per month on average. 

This is reflected in the Expat Insider 2021 report, in which Dublin came last for finance and housing for the fourth year running, mostly because of high housing costs and the local cost of living.

You can read more from our Working Around the World series here.



The post What is it like to live and work in Dublin? appeared first on Raconteur.

]]>
The ripple effect of the US climate bill on the British cleantech sector https://www.raconteur.net/sustainability/us-climate-bill-inflation-reduction-act-uk-cleantech-sector/ Thu, 11 Aug 2022 16:30:00 +0000 //www.raconteur.net/?p=157455 Image of workers inspecting solar panels at a renewable energy plan. In the background you can see Wind Turbines. Two different technologies to produce energy in a responsible and sustainable way. All my images have been processed in 16 Bits and transfer down to 8 before uploading.

The Inflation Reduction Act's billions of dollars in subsidies promise a shot in the arm for low-carbon businesses beyond America’s borders, from electric vehicles to green hydrogen


The US’s landmark Inflation Reduction Act looks set to be approved tomorrow (12 August), representing one of the biggest investments in emissions reductions and sustainable energy in history.

It includes support for a swathe of both emerging and established low-carbon technologies, making each significantly cheaper to produce and buy. These include solar panels, wind turbines, batteries, heat pumps and electric vehicles (EVs), as well as green hydrogen, carbon capture and small nuclear reactor technology.

Taken together, analysts predict the measures will slash the US’s carbon emissions by 40% and “kickstart the era of affordable clean energy in America”. But the $369bn (£300bn) package could also boost the burgeoning clean technology sector across the pond, not least by opening up a huge new market.

“When the US goes big on something, it has a massive impact elsewhere,” says Caroline Hargrove, who is CTO at Ceres, a British fuel cell and hydrogen engineering company that partners with companies in hard-to-decarbonise industries such as steel manufacturing. 

“It will give confidence to international companies to develop [green technology] in the US and then apply what worked there elsewhere, which is why we’re so excited.”

Although many of the act's subsidies are geared towards supporting American businesses, Sam Alvis, head of economy at think tank Green Alliance, says US green supply chains are still underdeveloped. “At least for the first few years, there will be opportunities to help companies bridge those supply chain, in particular in technologies like heat pumps, where the US is much further behind than Europe.”

Manufacturers across the UK and Europe are preparing to boost their US operations in anticipation of vastly increased demand. “The US will be the leading energy storage market globally,” one Norwegian battery firm tells Sifted, while UK power giant Drax says the bill will allow it to accelerate its carbon capture business in the US.

So much money flooding into the sector will produce “innovation spill-over effects” as manufacturers ramp up R&D spending, Alvis says. “If the US massively lowers the cost of producing batteries and clean energy, and of making EVs, then that's going to benefit all its allies and trading partners and allow us to innovate further.”

Providing a long-term clean energy plan

In contrast to what’s been dubbed the 'solar coaster' – in which American solar power subsidies fluctuated dramatically year-to-year, ham-stringing the industry – many of the tax credits included in the act will run for a decade or more. This will provide vital reassurance to investors hoping to fund early-stage businesses or projects that might take decades to pay off.

“We need to trust that these technologies [will] mature and get cheaper, but unless you give long-term incentives and people feel they can commit, it’s hard,” Hargrove says. 

She also praises the act’s support for multiple technologies, which is needed to build up a new energy system. For instance, Ceres’s hydrogen technology relies on access to renewable power and long-term energy storage, as well as a market convinced that it is a better option than fossil fuels. “You don’t just replace one item in a current system – you need to build that whole supply chain.”

Although some have criticised the act’s “all carrot and no stick” approach has been criticised for leaving doors open to fossil fuel companies, it may be the smartest way to encourage private investors to follow suit. “Tax credits are a really great way of unlocking private capital,” Alvis says. “It incentivises people to act first and rewards them for acting, rather than trying to push them to act with another mechanism.”

It’s an approach the UK government has already deployed. Rishi Sunak, then the chancellor, brought in a “super deduction” last year that allows companies to claim 130% tax credits on business equipment. If similar measures are focused on clean technology it could be a game-changer, Alvis argues, and potentially more palatable to a Conservative party wary of “hand-outs”.

Most potent of all, though, is the ripple effect potential: when the US makes such an ambitious move, the world still sits up. “This is such a huge signal to other countries - if the biggest emitter per capita is finally doing something, there is no reason for others not to as well,” Alvis says.



The post The ripple effect of the US climate bill on the British cleantech sector appeared first on Raconteur.

]]>
Image of workers inspecting solar panels at a renewable energy plan. In the background you can see Wind Turbines. Two different technologies to produce energy in a responsible and sustainable way. All my images have been processed in 16 Bits and transfer down to 8 before uploading.

The Inflation Reduction Act's billions of dollars in subsidies promise a shot in the arm for low-carbon businesses beyond America’s borders, from electric vehicles to green hydrogen


The US’s landmark Inflation Reduction Act looks set to be approved tomorrow (12 August), representing one of the biggest investments in emissions reductions and sustainable energy in history.

It includes support for a swathe of both emerging and established low-carbon technologies, making each significantly cheaper to produce and buy. These include solar panels, wind turbines, batteries, heat pumps and electric vehicles (EVs), as well as green hydrogen, carbon capture and small nuclear reactor technology.

Taken together, analysts predict the measures will slash the US’s carbon emissions by 40% and “kickstart the era of affordable clean energy in America”. But the $369bn (£300bn) package could also boost the burgeoning clean technology sector across the pond, not least by opening up a huge new market.

“When the US goes big on something, it has a massive impact elsewhere,” says Caroline Hargrove, who is CTO at Ceres, a British fuel cell and hydrogen engineering company that partners with companies in hard-to-decarbonise industries such as steel manufacturing. 

“It will give confidence to international companies to develop [green technology] in the US and then apply what worked there elsewhere, which is why we’re so excited.”

Although many of the act's subsidies are geared towards supporting American businesses, Sam Alvis, head of economy at think tank Green Alliance, says US green supply chains are still underdeveloped. “At least for the first few years, there will be opportunities to help companies bridge those supply chain, in particular in technologies like heat pumps, where the US is much further behind than Europe.”

Manufacturers across the UK and Europe are preparing to boost their US operations in anticipation of vastly increased demand. “The US will be the leading energy storage market globally,” one Norwegian battery firm tells Sifted, while UK power giant Drax says the bill will allow it to accelerate its carbon capture business in the US.

So much money flooding into the sector will produce “innovation spill-over effects” as manufacturers ramp up R&D spending, Alvis says. “If the US massively lowers the cost of producing batteries and clean energy, and of making EVs, then that's going to benefit all its allies and trading partners and allow us to innovate further.”

Providing a long-term clean energy plan

In contrast to what’s been dubbed the 'solar coaster' – in which American solar power subsidies fluctuated dramatically year-to-year, ham-stringing the industry – many of the tax credits included in the act will run for a decade or more. This will provide vital reassurance to investors hoping to fund early-stage businesses or projects that might take decades to pay off.

“We need to trust that these technologies [will] mature and get cheaper, but unless you give long-term incentives and people feel they can commit, it’s hard,” Hargrove says. 

She also praises the act’s support for multiple technologies, which is needed to build up a new energy system. For instance, Ceres’s hydrogen technology relies on access to renewable power and long-term energy storage, as well as a market convinced that it is a better option than fossil fuels. “You don’t just replace one item in a current system – you need to build that whole supply chain.”

Although some have criticised the act’s “all carrot and no stick” approach has been criticised for leaving doors open to fossil fuel companies, it may be the smartest way to encourage private investors to follow suit. “Tax credits are a really great way of unlocking private capital,” Alvis says. “It incentivises people to act first and rewards them for acting, rather than trying to push them to act with another mechanism.”

It’s an approach the UK government has already deployed. Rishi Sunak, then the chancellor, brought in a “super deduction” last year that allows companies to claim 130% tax credits on business equipment. If similar measures are focused on clean technology it could be a game-changer, Alvis argues, and potentially more palatable to a Conservative party wary of “hand-outs”.

Most potent of all, though, is the ripple effect potential: when the US makes such an ambitious move, the world still sits up. “This is such a huge signal to other countries - if the biggest emitter per capita is finally doing something, there is no reason for others not to as well,” Alvis says.



The post The ripple effect of the US climate bill on the British cleantech sector appeared first on Raconteur.

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‘Championing age’: how business can win back older workers https://www.raconteur.net/workplace/older-workers-labour-shortage/ Thu, 11 Aug 2022 15:17:24 +0000 //www.raconteur.net/?p=157494 Image of a multi-generational team working in an office

The boss of John Lewis has called on the government to find ways to encourage lost workers aged over 50 to return to the labour market to help the UK economy, but business must also play its part in enticing them back


Economic inactivity in the over-50s took an upturn during the pandemic, reversing the downward trend of the previous 10 years.

According to the Office for National Statistics (ONS), the number of people aged 50 to 70 years who moved from economic activity to inactivity between the second and third quarters of 2021 was 87,000 higher than in the same period in 2019. That is contributing to the more than 1 million drop in the size of the workforce and why unemployment is at a low of below 4% while job vacancies are at near record levels.

Some 75% of these older workers who left employment did so of their own accord, citing varying reasons such as feeling undervalued, seeking early retirement or simply not wanting to work anymore. But there is a need for their return.

Earlier this week, John Lewis CEO Dame Sharon White linked the exodus of over-50s from the workforce to rising inflation, claiming that the competition for talent to replace them had pushed up wages

Speaking on the BBC’s Today programme, she added: “There's not a business in the UK that's not finding it very difficult to recruit at the moment because there are so many more jobs and far fewer people looking for work. It's a big issue.”

As a result, White called on the government to “really think much more about how to encourage more people back into work”.

Can over-50s plug the recruitment gap?

Figures from the ONS also reveal that two-fifths (39%) of those aged over 50 who left the workforce during the pandemic would consider returning to paid work in the future. 

With the UK labour market remaining extremely tight – the number of unemployed people per vacancy is at a record low of 1.0 – there is a need to expand the workforce. Enticing back those who have left is seen as a way to bridge the gap.



Yvonne Smyth, group head of equity, diversity and inclusion at recruitment firm Hays, says: “Organisations are definitely more aware of older workers being an untapped and potentially overlooked talent pool.”

However, she advises that many businesses will need to adapt their workplace policies in order to entice the over-50s, in particular, back. “It’s very unlikely that you will be able to tempt someone who has retired back to work five days a week in an office, for example,” she says. “Employers need to be offering and advertising flexibility at the point of hire – and this includes part-time working.”

There is an opportunity for all organisations to step forward and educate their colleagues on generational differences and extend their diversity and inclusion strategies to focus on age, especially where it intersects with other protected characteristics

Travel and insurance firm Saga has had particular success in this area and managed to avoid the exodus of older talent from its workforce that many other businesses witnessed during the pandemic.

Its chief people officer Jane Storm attributes this to the organisation’s focus on being a “champion of age in the workplace”. To demonstrate this, Saga has held listening groups, introduced age training, and improved flexibility. It has also introduced new policies catered specifically to this group, including its grandparents leave policy, which gives staff one week of paid leave when a grandchild is born.

Storm says: “The UK is facing one of the biggest headwinds in our history, with low unemployment and a shortage of workers. Attracting and retaining this workforce is critical. There is an opportunity for all organisations to step forward and educate their colleagues on generational differences and extend their diversity and inclusion strategies to focus on age, especially where it intersects with other protected characteristics.”

How to encourage older people back to the workplace

Victoria Tomlinson is chief executive of Next-Up, an organisation that helps employees pre-retirement. She believes the over-50s are generally overlooked by businesses and agrees that offering flexibility is key.

“Employers have to take up the onus. Everyone is so focused on millennials that they've taken their eye off the ball with what's happening with the older generation,” she says. “What they need to do is make work flexible, to give people purpose and to invest in their skills in exactly the same way businesses do when people start their careers.”

With the cost-of-living crisis weighing heavily on people’s minds, many retirees could be persuaded back into employment in order to pick up additional income. But it is not the only perk the over-50s are looking for from an employer.

A survey byrecruitment company Robert Walters shows that flexible hours, citied by 55%, training opportunities (34%) and bonus schemes (30%) are the most popular perks among this demographic.

Tomlinson says that while some former retirees are just seeking an extra bit of money, “they need purpose and to feel valued as much as anyone. A lot of people struggle with sociable loss when they retire; they like to still feel part of something”.

Ageism is also an issue preventing older generations from returning to work. The Confederation of British Industry found that only 24% of HR leaders between the ages of 25 and 30 say they felt motivated to recruit workers in the 55 to 75 age bracket.

David Bernard, founder and CEO of behavioural assessment firm AssessFirst says: “The implications of ageist hiring practices are multi-faceted, but their effects have undoubtedly been felt by many jobseekers within older age groups. Biased hiring practices are exacerbating the labour shortage and causing businesses to miss out on a huge portion of talented workers capable of really making a difference.”

He advises companies that are looking to be more inclusive to evaluate the efficacy of their recruitment practices and to focus on an individual’s skills and qualities when hiring, rather than any other factors which are irrelevant to the job.

He adds: “If an organisation has built teams predominantly comprising younger individuals, they should consider asking themselves whether they have – consciously or subconsciously – avoided hiring those within older age groups - and why.”

Although the recently retired may seem appear to plug a hole during current recruitment challenges, it is clear companies have work to do to to tempt them back. And these changes need to be for the long term, kickstarting a change in the way business sees the value of older workers.



The post ‘Championing age’: how business can win back older workers appeared first on Raconteur.

]]>
Image of a multi-generational team working in an office

The boss of John Lewis has called on the government to find ways to encourage lost workers aged over 50 to return to the labour market to help the UK economy, but business must also play its part in enticing them back


Economic inactivity in the over-50s took an upturn during the pandemic, reversing the downward trend of the previous 10 years.

According to the Office for National Statistics (ONS), the number of people aged 50 to 70 years who moved from economic activity to inactivity between the second and third quarters of 2021 was 87,000 higher than in the same period in 2019. That is contributing to the more than 1 million drop in the size of the workforce and why unemployment is at a low of below 4% while job vacancies are at near record levels.

Some 75% of these older workers who left employment did so of their own accord, citing varying reasons such as feeling undervalued, seeking early retirement or simply not wanting to work anymore. But there is a need for their return.

Earlier this week, John Lewis CEO Dame Sharon White linked the exodus of over-50s from the workforce to rising inflation, claiming that the competition for talent to replace them had pushed up wages

Speaking on the BBC’s Today programme, she added: “There's not a business in the UK that's not finding it very difficult to recruit at the moment because there are so many more jobs and far fewer people looking for work. It's a big issue.”

As a result, White called on the government to “really think much more about how to encourage more people back into work”.

Can over-50s plug the recruitment gap?

Figures from the ONS also reveal that two-fifths (39%) of those aged over 50 who left the workforce during the pandemic would consider returning to paid work in the future. 

With the UK labour market remaining extremely tight – the number of unemployed people per vacancy is at a record low of 1.0 – there is a need to expand the workforce. Enticing back those who have left is seen as a way to bridge the gap.

Yvonne Smyth, group head of equity, diversity and inclusion at recruitment firm Hays, says: “Organisations are definitely more aware of older workers being an untapped and potentially overlooked talent pool.”

However, she advises that many businesses will need to adapt their workplace policies in order to entice the over-50s, in particular, back. “It’s very unlikely that you will be able to tempt someone who has retired back to work five days a week in an office, for example,” she says. “Employers need to be offering and advertising flexibility at the point of hire – and this includes part-time working.”

There is an opportunity for all organisations to step forward and educate their colleagues on generational differences and extend their diversity and inclusion strategies to focus on age, especially where it intersects with other protected characteristics

Travel and insurance firm Saga has had particular success in this area and managed to avoid the exodus of older talent from its workforce that many other businesses witnessed during the pandemic.

Its chief people officer Jane Storm attributes this to the organisation’s focus on being a “champion of age in the workplace”. To demonstrate this, Saga has held listening groups, introduced age training, and improved flexibility. It has also introduced new policies catered specifically to this group, including its grandparents leave policy, which gives staff one week of paid leave when a grandchild is born.

Storm says: “The UK is facing one of the biggest headwinds in our history, with low unemployment and a shortage of workers. Attracting and retaining this workforce is critical. There is an opportunity for all organisations to step forward and educate their colleagues on generational differences and extend their diversity and inclusion strategies to focus on age, especially where it intersects with other protected characteristics.”

How to encourage older people back to the workplace

Victoria Tomlinson is chief executive of Next-Up, an organisation that helps employees pre-retirement. She believes the over-50s are generally overlooked by businesses and agrees that offering flexibility is key.

“Employers have to take up the onus. Everyone is so focused on millennials that they've taken their eye off the ball with what's happening with the older generation,” she says. “What they need to do is make work flexible, to give people purpose and to invest in their skills in exactly the same way businesses do when people start their careers.”

With the cost-of-living crisis weighing heavily on people’s minds, many retirees could be persuaded back into employment in order to pick up additional income. But it is not the only perk the over-50s are looking for from an employer.

A survey byrecruitment company Robert Walters shows that flexible hours, citied by 55%, training opportunities (34%) and bonus schemes (30%) are the most popular perks among this demographic.

Tomlinson says that while some former retirees are just seeking an extra bit of money, “they need purpose and to feel valued as much as anyone. A lot of people struggle with sociable loss when they retire; they like to still feel part of something”.

Ageism is also an issue preventing older generations from returning to work. The Confederation of British Industry found that only 24% of HR leaders between the ages of 25 and 30 say they felt motivated to recruit workers in the 55 to 75 age bracket.

David Bernard, founder and CEO of behavioural assessment firm AssessFirst says: “The implications of ageist hiring practices are multi-faceted, but their effects have undoubtedly been felt by many jobseekers within older age groups. Biased hiring practices are exacerbating the labour shortage and causing businesses to miss out on a huge portion of talented workers capable of really making a difference.”

He advises companies that are looking to be more inclusive to evaluate the efficacy of their recruitment practices and to focus on an individual’s skills and qualities when hiring, rather than any other factors which are irrelevant to the job.

He adds: “If an organisation has built teams predominantly comprising younger individuals, they should consider asking themselves whether they have – consciously or subconsciously – avoided hiring those within older age groups - and why.”

Although the recently retired may seem appear to plug a hole during current recruitment challenges, it is clear companies have work to do to to tempt them back. And these changes need to be for the long term, kickstarting a change in the way business sees the value of older workers.



The post ‘Championing age’: how business can win back older workers appeared first on Raconteur.

]]>
Five cyber scams to avoid now https://www.raconteur.net/technology/five-cyber-scams-to-avoid/ Thu, 11 Aug 2022 13:50:04 +0000 //www.raconteur.net/?p=157467

Cyber attacks are on the rise. Knowing how to spot the warning signs makes it easier to avoid becoming a victim


To succeed in business, it has been said, you need sharp elbows and a hard head. But as well as the need to fend off competitors, vigilance for cyber attacks – and knowing how to sidestep them – is now high on the agenda of all business leaders.

Cybercriminals might be quick to devise new and increasingly sophisticated scams, hacks and fraud schemes but there are recognisable patterns. Experts reveal the top five most common types of cyber attacks.



The post Five cyber scams to avoid now appeared first on Raconteur.

]]>

Cyber attacks are on the rise. Knowing how to spot the warning signs makes it easier to avoid becoming a victim


To succeed in business, it has been said, you need sharp elbows and a hard head. But as well as the need to fend off competitors, vigilance for cyber attacks – and knowing how to sidestep them – is now high on the agenda of all business leaders.

Cybercriminals might be quick to devise new and increasingly sophisticated scams, hacks and fraud schemes but there are recognisable patterns. Experts reveal the top five most common types of cyber attacks.



The post Five cyber scams to avoid now appeared first on Raconteur.

]]>
Is litigation aiding the transition from fossil fuels to green energy? https://www.raconteur.net/legal/litigation-transition-fossil-fuels-green-energy/ Thu, 11 Aug 2022 13:40:00 +0000 //www.raconteur.net/?p=157457

Climate litigation has doubled since 2015, with the impact of cases often stretching far beyond the final court verdict


Hawaiian children are suing their local transport department over pollution concerns. Transport Action Network has issued a legal challenge against the UK government for its road investment strategy. And Greenpeace Germany filed a lawsuit against Volkswagen AG for failing to protect the planet. 

There is an uptick in litigation against fossil fuel-driven transport, driven by concerns about the planet’s climate. But do these legal actions affect transport strategies, and do they push businesses towards positive climate action?

In 2022, the IPCC recognised the role that litigation can play in affecting “the outcome and ambition of climate governance”. The number of climate-related lawsuits has doubled since 2015, with almost a quarter of those cases filed since the start of 2020, according to Global Trends in Climate Litigation, an annual report by the Grantham Research Institute on Climate Change and the Environment at the London School of Economics and Political Science. 

In 2021, more than half of cases were filed against defendants in the transport, food and agriculture, plastics and finance sectors

Joana Setzer is assistant professor at the institute and the report’s co-author. Much of climate litigation is against governments, she says, inspired by the landmark case between Dutch citizens and the Urgenda Foundation NGO versus the state of the Netherlands in 2015. 

“The district courts of the Hague agreed that the government wasn’t doing enough to prevent climate change. It was the first time you had a court telling a government to raise ambitions and that was a turning point,” she explains. “The whole landscape changed quite dramatically after that.”

Globally, there are now 73 cases challenging governments’ overall response to climate change. And of the eight where decisions have already been issued by the country’s highest court, six had favourable outcomes for climate action.

But Setzer points out that suits are no longer limited to the carbon majors but extending into other sectors. “In 2021, 16 of the 38 cases against corporate defendants were filed against fossil fuel companies, while more than half were filed against defendants in other sectors, with transport, food and agriculture, plastics and finance all targeted in multiple cases,” she says. 

In her opinion, these claims are increasing partly as climate litigation cases have support from the wider community. “Climate change is widely discussed now, and there is more expertise among lawyers who are better prepared to bring these cases and judges who are more accepting of these cases,” she says.

Ugo Taddei leads the Clean Air team within the Strategic Litigation programme at the NGO ClientEarth. He believes that such suits are effective in bringing about environmental action. “Air pollution is falling twice as steeply in cities in Germany where air quality litigation has been taken, compared with those with no legal interventions,” he says.

On the corporate side, he adds, litigation sends strong market signals to companies. The automotive sector, for example, has been greatly affected by air pollution rising to the top of the health agenda in the past decade, with legal challenges to authorities that have failed to comply with regulations to limit air pollution across Europe.

ClientEarth has been involved in several of these cases, notably winning three national challenges on air pollution against the UK government. “In the final ruling in 2018, the judge said good intention from the government is not enough. We need ClientEarth to keep putting pressure on the government so it will deliver,” he says.  

“When I joined ClientEarth in 2014, more than one in two cars purchased in the EU was diesel. Last year, for the first time more electric vehicles were sold than diesel – more than 20%. I couldn’t have imagined such a quick shift. Clean air was hardly a topic in the media before,” he says. 

In 2020, the UK government announced a ban on new petrol and diesel cars by 2030, which is 10 years earlier than it had previously committed to achieving. A 2035 ban on internal combustion engine vehicles is on the table at EU level.

Climate litigation with such strategic ambition is on the rise, according to Setzer. This refers to cases where the claimants’ motives go beyond the concerns of the individual case and seek to “bring about some broader societal shift”, be that climate action, raising public awareness or nudging the behaviour of government or industry actors.

Litigation empowers communities and defends their rights. The process can be a path towards restorative justice for communities bearing the brunt of climate impact

An increasing number of suits are being filed in the Global South. Based in Nairobi, Mark Odaga is defending rights programme manager at Natural Justice, an environmental justice NGO. He says: “Litigation empowers communities and defends their rights. The process can be a path towards restorative justice for communities bearing the brunt of climate impact.”

Even when legal challenges are lost, the cases can be significant in terms of raising the profile of an issue. Transport Action Network didn’t ultimately stop the UK government’s £27bn road-building programme but, according to the NGO’s founder and director Chris Todd, the action was successful in other ways. “It got lots of people in the industry and media talking about the impact of road-building on the government’s carbon targets, which really raised awareness,” he says.

“Ultimately, we got the government to accept there was a need to review the national policy statement afterwards, and it acknowledged the transport to decarbonisation plan was out of date and needed to be reviewed. We see that as a direct result of our badgering through legal challenge.”

One of the new trends in climate litigation is a shifting of cases from the company to the individual, observes Setzer. “Instead of suing the company, a case is brought against the CEO. Or against a minister instead of the government.” This is seen with ClientEarth’s current legal action against Shell’s board of directors for mismanaging climate risk, which could have a powerful effect in terms of making individuals think twice before they plan.

“Litigation is a powerful storytelling tool,” says Setzer. “The more media coverage these cases get, the more cases there are and the greater the reputational damage can be for companies. It’s become a self-reinforcing mechanism – which encourages behaviour change.”



The post Is litigation aiding the transition from fossil fuels to green energy? appeared first on Raconteur.

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Climate litigation has doubled since 2015, with the impact of cases often stretching far beyond the final court verdict


Hawaiian children are suing their local transport department over pollution concerns. Transport Action Network has issued a legal challenge against the UK government for its road investment strategy. And Greenpeace Germany filed a lawsuit against Volkswagen AG for failing to protect the planet. 

There is an uptick in litigation against fossil fuel-driven transport, driven by concerns about the planet’s climate. But do these legal actions affect transport strategies, and do they push businesses towards positive climate action?

In 2022, the IPCC recognised the role that litigation can play in affecting “the outcome and ambition of climate governance”. The number of climate-related lawsuits has doubled since 2015, with almost a quarter of those cases filed since the start of 2020, according to Global Trends in Climate Litigation, an annual report by the Grantham Research Institute on Climate Change and the Environment at the London School of Economics and Political Science. 

In 2021, more than half of cases were filed against defendants in the transport, food and agriculture, plastics and finance sectors

Joana Setzer is assistant professor at the institute and the report’s co-author. Much of climate litigation is against governments, she says, inspired by the landmark case between Dutch citizens and the Urgenda Foundation NGO versus the state of the Netherlands in 2015. 

“The district courts of the Hague agreed that the government wasn’t doing enough to prevent climate change. It was the first time you had a court telling a government to raise ambitions and that was a turning point,” she explains. “The whole landscape changed quite dramatically after that.”

Globally, there are now 73 cases challenging governments’ overall response to climate change. And of the eight where decisions have already been issued by the country’s highest court, six had favourable outcomes for climate action.

But Setzer points out that suits are no longer limited to the carbon majors but extending into other sectors. “In 2021, 16 of the 38 cases against corporate defendants were filed against fossil fuel companies, while more than half were filed against defendants in other sectors, with transport, food and agriculture, plastics and finance all targeted in multiple cases,” she says. 

In her opinion, these claims are increasing partly as climate litigation cases have support from the wider community. “Climate change is widely discussed now, and there is more expertise among lawyers who are better prepared to bring these cases and judges who are more accepting of these cases,” she says.

Ugo Taddei leads the Clean Air team within the Strategic Litigation programme at the NGO ClientEarth. He believes that such suits are effective in bringing about environmental action. “Air pollution is falling twice as steeply in cities in Germany where air quality litigation has been taken, compared with those with no legal interventions,” he says.

On the corporate side, he adds, litigation sends strong market signals to companies. The automotive sector, for example, has been greatly affected by air pollution rising to the top of the health agenda in the past decade, with legal challenges to authorities that have failed to comply with regulations to limit air pollution across Europe.

ClientEarth has been involved in several of these cases, notably winning three national challenges on air pollution against the UK government. “In the final ruling in 2018, the judge said good intention from the government is not enough. We need ClientEarth to keep putting pressure on the government so it will deliver,” he says.  

“When I joined ClientEarth in 2014, more than one in two cars purchased in the EU was diesel. Last year, for the first time more electric vehicles were sold than diesel – more than 20%. I couldn’t have imagined such a quick shift. Clean air was hardly a topic in the media before,” he says. 

In 2020, the UK government announced a ban on new petrol and diesel cars by 2030, which is 10 years earlier than it had previously committed to achieving. A 2035 ban on internal combustion engine vehicles is on the table at EU level.

Climate litigation with such strategic ambition is on the rise, according to Setzer. This refers to cases where the claimants’ motives go beyond the concerns of the individual case and seek to “bring about some broader societal shift”, be that climate action, raising public awareness or nudging the behaviour of government or industry actors.

Litigation empowers communities and defends their rights. The process can be a path towards restorative justice for communities bearing the brunt of climate impact

An increasing number of suits are being filed in the Global South. Based in Nairobi, Mark Odaga is defending rights programme manager at Natural Justice, an environmental justice NGO. He says: “Litigation empowers communities and defends their rights. The process can be a path towards restorative justice for communities bearing the brunt of climate impact.”

Even when legal challenges are lost, the cases can be significant in terms of raising the profile of an issue. Transport Action Network didn’t ultimately stop the UK government’s £27bn road-building programme but, according to the NGO’s founder and director Chris Todd, the action was successful in other ways. “It got lots of people in the industry and media talking about the impact of road-building on the government’s carbon targets, which really raised awareness,” he says.

“Ultimately, we got the government to accept there was a need to review the national policy statement afterwards, and it acknowledged the transport to decarbonisation plan was out of date and needed to be reviewed. We see that as a direct result of our badgering through legal challenge.”

One of the new trends in climate litigation is a shifting of cases from the company to the individual, observes Setzer. “Instead of suing the company, a case is brought against the CEO. Or against a minister instead of the government.” This is seen with ClientEarth’s current legal action against Shell’s board of directors for mismanaging climate risk, which could have a powerful effect in terms of making individuals think twice before they plan.

“Litigation is a powerful storytelling tool,” says Setzer. “The more media coverage these cases get, the more cases there are and the greater the reputational damage can be for companies. It’s become a self-reinforcing mechanism – which encourages behaviour change.”



The post Is litigation aiding the transition from fossil fuels to green energy? appeared first on Raconteur.

]]>
Construction industry hammered by material shortages https://www.raconteur.net/construction/material-shortages-construction/ Wed, 10 Aug 2022 13:05:00 +0000 //www.raconteur.net/?p=157447 Illustration of material shortages in construction

Are global supply chain issues merely temporary or here to stay? How can the sector overcome them?


Illustration of material shortages in construction

The construction industry has experienced a troubled recovery from the pandemic.  Trade tariffs, congested logistics routes, labour shortages, and even climate change are hindering recovery in the construction sector. But the most obvious legacies of lockdown are the shortages of construction materials and unprecedented price hikes.  

“The volatility in construction material prices experienced this year is unprecedented,” said Henry D’Esposito, JLL Research Manager, Construction in the executive summary to the firm’s Construction Outlook 2021 report.

“The increases in lumber and steel prices are by far the largest recorded through available government data back to 1949. For other commodities the records are somewhat more recent: aluminum prices have not increased this fast since 1995, plastic since 1976, copper since 2010. The inauspicious distinction this year is that all those records are being broken at the same time. Average material prices for a commercial project increased an astounding 23% in the 12 months prior to August 2021,” said D’Esposito.

What’s challenging is the cascade of disruptions right now. It’s not just one. We’re dealing with systemic issues as well as acute issues right now

It’s tempting to explain away such stark statistics as Covid-related. But there are long-term issues at play, there is no sign of immediate bounce-back. 

“The speed of recovery from the pandemic is slower than hoped for as the Purchasing Managers’ Indices indicate,” says Duncan Brock, group director of the Chartered Institute of Procurement and Supply (CIPS). He believes that the scarcity of supplies is unlikely to abate any time soon.

“The Bank of England governor has warned that the UK is likely to go into recession towards the end of the year... This is worrying and supply chain managers will have to draw on their creativity in the sector as affordability rates for housing, for instance, are likely to be affected.

Covid is an obvious reason for the shortages in construction materials. Worldwide lockdowns shut down building sites and factories alike. But while construction has reopened, the processes that facilitate the trade are still faltering. Ongoing lockdowns in China mean that much of its manufacturing is stalled. Of equal, if not more importance, the logistics and supply routes that run through the country have been hit hard. Ports are congested and many urgent supplies are stuck in the stacks. The labour required to ensure the smooth running of the world’s supply chains is unavailable.

But not all of this is due to Covid. The lack of available labour, and the cost of it, are long-term issues that Covid exacerbated.

Geopolitical events are also long-term and difficult to forecast or mitigate. The conflict in Ukraine may have been predicted by political experts but many construction firms were taken by surprise. Brexit bureaucracy jammed warehouses and the Trump administration’s trading tariffs contributed to price fluctuations, such as restrictions on Canadian timber. The effects of these are still playing out and there will surely be more to come.

The shortage of lumber is another ongoing challenge, linked to a tangential cause: climate change. Planning for freak weather events has always been a feature of supply chain management but it’s difficult to tackle such a broad subject as climate change when it is one factor among many.

“What’s challenging is the cascade of disruptions we have right now. It's not just one,” says Abe Eshkenazi, CEO of the Association of Supply Chain Management. “You’re not just talking about rerouting around an ash cloud, which is temporary and maybe in a few weeks will dissipate. We’re dealing with systemic issues as well as acute issues right now.”

The volatility in construction material prices experienced this year is unprecedented in contemporary history

Addressing systemic issues is a complex task. As gifted as project managers are, reversing the labour shortfall, unclogging ports, rescinding tariffs and solving climate change is a lot to ask. But there are strategies that can address some of the worst effects of materials shortages and even have a positive impact on long-term concerns such as sustainability.

“It’s tough to take our eye off the ball in terms of the acute issues to focus on the systemic,” says Eshkenazi, but he says they shouldn’t take a backseat. “We are not mitigating or minimising the challenges but climate change and the impact on our environment need to be addressed as we deal with the short-term issues.”

It’s easy to leave big change to large firms. They have the resources to research and invest in new methods and materials. But larger businesses can use quick fixes that address systemic flaws but don’t tackle the causative issues. Even if the big operators recover faster, businesses that have taken the opportunity to adapt their long-term processes may recover stronger.

A longer-term approach includes exploring sources or types of materials. Brock says that CIPS research from late 2021 showed that supply chain managers were looking at local sourcing, which would speed delivery times while viable alternative materials could improve sustainability and reduce carbon emissions.

Data and visibility are essential tools to manage supply chains. “If you haven’t developed your risk profile on key commodities and supplies, do it now and use data to find additional risks potentially by geography and sector. Hire people who know how to build resilience into your supply chain,” says Brock.

The speed of recovery from the pandemic is slower than hoped

Solid, practical advice. But data itself is in short supply. Without knowing when the people of China will return to work, we cannot know when supplies will become available or where they will go. “The current unpredictability is creating significant challenges,” says Eshkenazi. Without data, there is no end in sight to materials shortages.

But, the cheapest and arguably the most effective tool for mitigating the crisis of materials supply is available to all levels of builders: communication. Eshkenazi favours talking to tier 1, 2 and even tier 3 suppliers to anticipate and iron out bumps in the supply chain. Likewise, communication with clients goes a long way. It is always difficult to go back on timelines and set prices, but providing timely information to clients may foster the respect that can keep the contract alive despite delays.

Shortages of materials have been something of a wake-up call for the construction industry. The costs of ignoring long-term issues have been made clear and perhaps unprecedented price hikes will prove to be an impetus for systemic change.



The post Construction industry hammered by material shortages appeared first on Raconteur.

]]>
Illustration of material shortages in construction

Are global supply chain issues merely temporary or here to stay? How can the sector overcome them?


Illustration of material shortages in construction

The construction industry has experienced a troubled recovery from the pandemic.  Trade tariffs, congested logistics routes, labour shortages, and even climate change are hindering recovery in the construction sector. But the most obvious legacies of lockdown are the shortages of construction materials and unprecedented price hikes.  

“The volatility in construction material prices experienced this year is unprecedented,” said Henry D’Esposito, JLL Research Manager, Construction in the executive summary to the firm’s Construction Outlook 2021 report.

“The increases in lumber and steel prices are by far the largest recorded through available government data back to 1949. For other commodities the records are somewhat more recent: aluminum prices have not increased this fast since 1995, plastic since 1976, copper since 2010. The inauspicious distinction this year is that all those records are being broken at the same time. Average material prices for a commercial project increased an astounding 23% in the 12 months prior to August 2021,” said D’Esposito.

What’s challenging is the cascade of disruptions right now. It’s not just one. We’re dealing with systemic issues as well as acute issues right now

It’s tempting to explain away such stark statistics as Covid-related. But there are long-term issues at play, there is no sign of immediate bounce-back. 

“The speed of recovery from the pandemic is slower than hoped for as the Purchasing Managers’ Indices indicate,” says Duncan Brock, group director of the Chartered Institute of Procurement and Supply (CIPS). He believes that the scarcity of supplies is unlikely to abate any time soon.

“The Bank of England governor has warned that the UK is likely to go into recession towards the end of the year... This is worrying and supply chain managers will have to draw on their creativity in the sector as affordability rates for housing, for instance, are likely to be affected.

Covid is an obvious reason for the shortages in construction materials. Worldwide lockdowns shut down building sites and factories alike. But while construction has reopened, the processes that facilitate the trade are still faltering. Ongoing lockdowns in China mean that much of its manufacturing is stalled. Of equal, if not more importance, the logistics and supply routes that run through the country have been hit hard. Ports are congested and many urgent supplies are stuck in the stacks. The labour required to ensure the smooth running of the world’s supply chains is unavailable.

But not all of this is due to Covid. The lack of available labour, and the cost of it, are long-term issues that Covid exacerbated.

Geopolitical events are also long-term and difficult to forecast or mitigate. The conflict in Ukraine may have been predicted by political experts but many construction firms were taken by surprise. Brexit bureaucracy jammed warehouses and the Trump administration’s trading tariffs contributed to price fluctuations, such as restrictions on Canadian timber. The effects of these are still playing out and there will surely be more to come.

The shortage of lumber is another ongoing challenge, linked to a tangential cause: climate change. Planning for freak weather events has always been a feature of supply chain management but it’s difficult to tackle such a broad subject as climate change when it is one factor among many.

“What’s challenging is the cascade of disruptions we have right now. It's not just one,” says Abe Eshkenazi, CEO of the Association of Supply Chain Management. “You’re not just talking about rerouting around an ash cloud, which is temporary and maybe in a few weeks will dissipate. We’re dealing with systemic issues as well as acute issues right now.”

The volatility in construction material prices experienced this year is unprecedented in contemporary history

Addressing systemic issues is a complex task. As gifted as project managers are, reversing the labour shortfall, unclogging ports, rescinding tariffs and solving climate change is a lot to ask. But there are strategies that can address some of the worst effects of materials shortages and even have a positive impact on long-term concerns such as sustainability.

“It’s tough to take our eye off the ball in terms of the acute issues to focus on the systemic,” says Eshkenazi, but he says they shouldn’t take a backseat. “We are not mitigating or minimising the challenges but climate change and the impact on our environment need to be addressed as we deal with the short-term issues.”

It’s easy to leave big change to large firms. They have the resources to research and invest in new methods and materials. But larger businesses can use quick fixes that address systemic flaws but don’t tackle the causative issues. Even if the big operators recover faster, businesses that have taken the opportunity to adapt their long-term processes may recover stronger.

A longer-term approach includes exploring sources or types of materials. Brock says that CIPS research from late 2021 showed that supply chain managers were looking at local sourcing, which would speed delivery times while viable alternative materials could improve sustainability and reduce carbon emissions.

Data and visibility are essential tools to manage supply chains. “If you haven’t developed your risk profile on key commodities and supplies, do it now and use data to find additional risks potentially by geography and sector. Hire people who know how to build resilience into your supply chain,” says Brock.

The speed of recovery from the pandemic is slower than hoped

Solid, practical advice. But data itself is in short supply. Without knowing when the people of China will return to work, we cannot know when supplies will become available or where they will go. “The current unpredictability is creating significant challenges,” says Eshkenazi. Without data, there is no end in sight to materials shortages.

But, the cheapest and arguably the most effective tool for mitigating the crisis of materials supply is available to all levels of builders: communication. Eshkenazi favours talking to tier 1, 2 and even tier 3 suppliers to anticipate and iron out bumps in the supply chain. Likewise, communication with clients goes a long way. It is always difficult to go back on timelines and set prices, but providing timely information to clients may foster the respect that can keep the contract alive despite delays.

Shortages of materials have been something of a wake-up call for the construction industry. The costs of ignoring long-term issues have been made clear and perhaps unprecedented price hikes will prove to be an impetus for systemic change.



The post Construction industry hammered by material shortages appeared first on Raconteur.

]]>
Consumer Duty reforms to shake up retail banking in 2023 https://www.raconteur.net/finance/financial-services/consumer-duty-reforms/ Wed, 10 Aug 2022 11:36:00 +0000 //www.raconteur.net/?p=157436 FCA Financial Conduct Authority HQ in International Quarter London in Stratford East London

Firms are racing to ready for the FCA’s new Consumer Duty – a wide-ranging slab of regulation that is a catalyst for lasting change in financial services


FCA Financial Conduct Authority HQ in International Quarter London in Stratford East London

When the Financial Conduct Authority (FCA) confirmed in late 2021 that it would introduce the Consumer Duty, there was little pushback from firms. Perhaps this was because they thought it an inconsequential development that would have little impact on how they do business. Yet the new duty – proposed in 2017 by the Financial Services Consumer Panel – is among the most wide-ranging reforms the FCA has overseen. 

The core requirement for companies to “focus on supporting and empowering their customers to make good financial decisions” sounds simple and most firms will say they already do that. But drill deeper and the ambition of the change is evident. 

Joanne Owens is a consumer finance and retail financial services regulatory partner at Eversheds Sutherland. She says the consumer duty is a seismic change and “arguably the most significant shake-up of FCA regulation since the introduction of the Financial Services and Markets Act 2000”.

Principle 6 of the FCA’s Principles of Business obliges firms to pay “due regard to the interests of customers and treat them fairly”, while Principle 7 concerns “due regard to the information needs of its clients, and communicate information to them in a way which is clear, fair and not misleading”. The new duty replaces those principles with one that applies higher standards of conduct: “A firm must act to deliver good outcomes for retail customers.”

The duty lists four key outcomes: customers are equipped to make informed decisions; products and services are fit for purpose; service meets customer needs; and products and services represent fair value. “This is a sea change in how the FCA regulates, with companies having to prove on an ongoing basis that they are delivering good customer outcomes,” says Fairer Finance MD James Daley. “It could stimulate a race to the top on quality.”

But with the FCA expecting the new duty to be fully implemented by 30 April 2023, firms must move quickly. “No doubt the whole retail financial services sector is working hard on initial assessments and a gap analysis to understand where the current delta is between existing policies and procedures and the new higher standards,” Owens says.

This is a sizable task, given the duty’s wide scope and application to new and existing products. The new rules make it clear that firms are not to continue with business models that rely on poor outcomes. This places certain product lines under threat; 0% no-fee credit cards, for example, rely on some customers not clearing their balance and paying higher interest rates as a result. Similarly, it will be harder to justify leaving mortgage customers on high standard variable rates.

This is an opportunity for businesses to shape and define their products and services

The extent to which customer choice might reduce in some product areas because of the reforms will partly depend on how firms judge whether they can still deliver value for money under the duty, says Neil Mitchell, head of customer risk at TSB Bank. “There is also a risk of a lack of consistency in approach as firms follow their business models in how they do that.”

Price increases might be necessary, to cover the costs of implementing the duty. The FCA estimated the one-off direct costs at up to £2.4bn and ongoing annual direct costs ranging from £74m to £176.2m. Firms might change how they value products, as prices must be proportionate to the overall benefit to the consumer. 

“This is not just about assessing financial cost, but other non-financial costs to the consumer, including the use of their data,” Owens explains. “This could have an impact on the length of distribution chains for some introduced products, particularly where a commission is charged.” The scale of the challenge means some businesses will see the consumer duty as a threat, although others will see the opportunity, Owens says.

“This is an opportunity (for businesses) to shape and define their products and services and to think about how they deliver the right outcomes for their existing and future customers.”

TSB Bank established a programme to comply with the new requirements in January 2022, Mitchell says. “We are assessing all business units in TSB on their current position against the consultation and draft rules – this is our discovery phase. Once the rules are finalised, we move into our delivery phase.”

Much of the initial work by firms focuses on communications. Providers often write their terms and conditions through the lens of compliance – if the FCA signs it off, it’s fine. But the duty will require them to ensure that customers can understand what they are being told.

“The customer understanding outcome means customers must understand communications and we know that people can’t make head or tail of the terms and conditions (T&Cs) documents or the letters they get from companies,” says Daley. 

“We’ve been helping companies rewrite letters and T&Cs for years but we’re seeing a spike in interest.” The challenge for banks is the tension between the customer understanding outcome and meeting existing consumer credit rules that require them to include prescribed statements in customer communications. 

The duty’s cross-cutting nature gives it the potential to be a catalyst for cultural change in banks and across the industry. It will likely change how customers are treated, what and how retail products are sold, and to whom they are sold.

The desired long-term outcome from a regulatory perspective is a more stable market that needs less intervention and fewer rule changes. 

“From a consumer perspective we won’t see a big change overnight, but over time it has the potential to improve standards and the quality of financial services,” says Daley.

With the final rules expected in July 2022 and firms expected to be fully compliant by April 2023, there’s no time for firms to waste.



The post Consumer Duty reforms to shake up retail banking in 2023 appeared first on Raconteur.

]]>
FCA Financial Conduct Authority HQ in International Quarter London in Stratford East London

Firms are racing to ready for the FCA’s new Consumer Duty – a wide-ranging slab of regulation that is a catalyst for lasting change in financial services


FCA Financial Conduct Authority HQ in International Quarter London in Stratford East London

When the Financial Conduct Authority (FCA) confirmed in late 2021 that it would introduce the Consumer Duty, there was little pushback from firms. Perhaps this was because they thought it an inconsequential development that would have little impact on how they do business. Yet the new duty – proposed in 2017 by the Financial Services Consumer Panel – is among the most wide-ranging reforms the FCA has overseen. 

The core requirement for companies to “focus on supporting and empowering their customers to make good financial decisions” sounds simple and most firms will say they already do that. But drill deeper and the ambition of the change is evident. 

Joanne Owens is a consumer finance and retail financial services regulatory partner at Eversheds Sutherland. She says the consumer duty is a seismic change and “arguably the most significant shake-up of FCA regulation since the introduction of the Financial Services and Markets Act 2000”.

Principle 6 of the FCA’s Principles of Business obliges firms to pay “due regard to the interests of customers and treat them fairly”, while Principle 7 concerns “due regard to the information needs of its clients, and communicate information to them in a way which is clear, fair and not misleading”. The new duty replaces those principles with one that applies higher standards of conduct: “A firm must act to deliver good outcomes for retail customers.”

The duty lists four key outcomes: customers are equipped to make informed decisions; products and services are fit for purpose; service meets customer needs; and products and services represent fair value. “This is a sea change in how the FCA regulates, with companies having to prove on an ongoing basis that they are delivering good customer outcomes,” says Fairer Finance MD James Daley. “It could stimulate a race to the top on quality.”

But with the FCA expecting the new duty to be fully implemented by 30 April 2023, firms must move quickly. “No doubt the whole retail financial services sector is working hard on initial assessments and a gap analysis to understand where the current delta is between existing policies and procedures and the new higher standards,” Owens says.

This is a sizable task, given the duty’s wide scope and application to new and existing products. The new rules make it clear that firms are not to continue with business models that rely on poor outcomes. This places certain product lines under threat; 0% no-fee credit cards, for example, rely on some customers not clearing their balance and paying higher interest rates as a result. Similarly, it will be harder to justify leaving mortgage customers on high standard variable rates.

This is an opportunity for businesses to shape and define their products and services

The extent to which customer choice might reduce in some product areas because of the reforms will partly depend on how firms judge whether they can still deliver value for money under the duty, says Neil Mitchell, head of customer risk at TSB Bank. “There is also a risk of a lack of consistency in approach as firms follow their business models in how they do that.”

Price increases might be necessary, to cover the costs of implementing the duty. The FCA estimated the one-off direct costs at up to £2.4bn and ongoing annual direct costs ranging from £74m to £176.2m. Firms might change how they value products, as prices must be proportionate to the overall benefit to the consumer. 

“This is not just about assessing financial cost, but other non-financial costs to the consumer, including the use of their data,” Owens explains. “This could have an impact on the length of distribution chains for some introduced products, particularly where a commission is charged.” The scale of the challenge means some businesses will see the consumer duty as a threat, although others will see the opportunity, Owens says.

“This is an opportunity (for businesses) to shape and define their products and services and to think about how they deliver the right outcomes for their existing and future customers.”

TSB Bank established a programme to comply with the new requirements in January 2022, Mitchell says. “We are assessing all business units in TSB on their current position against the consultation and draft rules – this is our discovery phase. Once the rules are finalised, we move into our delivery phase.”

Much of the initial work by firms focuses on communications. Providers often write their terms and conditions through the lens of compliance – if the FCA signs it off, it’s fine. But the duty will require them to ensure that customers can understand what they are being told.

“The customer understanding outcome means customers must understand communications and we know that people can’t make head or tail of the terms and conditions (T&Cs) documents or the letters they get from companies,” says Daley. 

“We’ve been helping companies rewrite letters and T&Cs for years but we’re seeing a spike in interest.” The challenge for banks is the tension between the customer understanding outcome and meeting existing consumer credit rules that require them to include prescribed statements in customer communications. 

The duty’s cross-cutting nature gives it the potential to be a catalyst for cultural change in banks and across the industry. It will likely change how customers are treated, what and how retail products are sold, and to whom they are sold.

The desired long-term outcome from a regulatory perspective is a more stable market that needs less intervention and fewer rule changes. 

“From a consumer perspective we won’t see a big change overnight, but over time it has the potential to improve standards and the quality of financial services,” says Daley.

With the final rules expected in July 2022 and firms expected to be fully compliant by April 2023, there’s no time for firms to waste.



The post Consumer Duty reforms to shake up retail banking in 2023 appeared first on Raconteur.

]]>
Five ways to help payments companies reach net zero https://www.raconteur.net/finance/payments-net-zero/ Wed, 10 Aug 2022 10:25:00 +0000 //www.raconteur.net/?p=157428 Power Plant in the sunrise

A few key players are in the vanguard of the payments industry’s decarbonisation charge. The insights they have gained so far are too important for them not to share


Power Plant in the sunrise

Payment service providers can play a pivotal role in supporting society’s move to a low-carbon economy, yet several are struggling to attain their own net-zero targets. Some strategies have been working well, but much more needs to be done – even by the largest and best-resourced players in the sector.

Payment providers should be well positioned to cut greenhouse gas emissions – in their operations, supply chains and customer networks – thanks to their ability to track spending and engage with buyers at the checkout. They can use their data insights and influence to raise customers’ awareness of their carbon footprints, inform them of their options and nudge them towards the most sustainable ones.

That’s the view of Doug Sabo, chief sustainability officer at Visa, whose network “connects billions of customers”. 

Sabo believes that his company has a “great opportunity to use its assets to inspire climate action through enabling sustainable behaviour. It’s also a chance for us and the payments industry to connect climate action to a business case, aligning with consumers’ demands and mitigating risks. We could do this by, for example, enabling seamless payments for electric vehicle charging.”

Here are five tips from pioneering payment providers on how the whole industry can hasten its progress towards net zero.

1. Rationalise and consolidate systems

One of the biggest contributors to payment companies’ carbon footprints is the electricity they use in their operations. 

To reduce its CO2 emissions, North American Bancard (NAB), parent of PayAnywhere, has consolidated its systems and operations from six separate data centres into two, both of which use 100% renewable electricity. It has also equipped its call centres with energy-efficient Chromebook devices. 

“We have learnt that competitively priced, environmentally friendly providers are out there,” says NAB’s chief information officer, Andy Bolin. “You just need to choose the right ones from the start. It’s easier to build a more sustainable ecosystem now than to reverse-engineer it later.”

2. Bring customers and networks on board

Perhaps the biggest opportunity for payments providers to cut CO2 emissions lies in engaging with their billions of customers and their huge supplier networks. 

A 2021 business briefing by the University of Cambridge recommends that providers work collaboratively to shape new services that will counter climate change. The document, Payments for Net Zero, also highlights providers’ ability to use data-driven insights to support this by, for example, producing more targeted products.

Sendi Young, MD of payments settlement system Ripple in Europe, says: “Organisations should prioritise learning from others and take advantage of partnerships. We need to work as a collective to make our industry fully sustainable.” 

To this end, Ripple has joined the Crypto Climate Accord, a group of crypto asset providers with the shared goal of decarbonising the industry.  

PayPal, meanwhile, is aiming to harness the power of its 400 million customers to advance science-based action and align its offerings with their growing interest in sustainability. For example, its network of so-called return bars – locations where shoppers can hand back unwanted goods – enables product returns to impose a smaller carbon footprint than they would make via any mailing system.

Organisations should prioritise learning from others and take advantage of partnerships. We need to work as a collective

A spokesman for PayPal says: “We’ve learnt that enabling climate solutions is not just about individual businesses; it’s also about markets and ecosystems. Innovation and entrepreneurship are also essential. We’ve invested in startup companies that are testing ideas that can unlock new climate solutions and address scalability issues.”

Sabo reports that Visa’s decarbonisation strategy has “evolved outside our operations. For payment companies, the transformative opportunity is to enable others to transition to a low-carbon economy by inspiring and empowering the consumers and businesses that use our services to make more sustainable choices.”

Visa has done this both directly with bank clients and via a partnership with Ecolytiq, which enables them to obtain estimates of the carbon footprint imposed by their spending habits. Clients also receive tailored guidance on how they could make more sustainable purchasing choices.

3. Invest directly in removing carbon

Buy-now-pay-later giant Klarna has introduced an internal tax on all its emissions, including in its supply chain. This entails setting aside money to spend on decarbonisation initiatives. 

Last year the fund totalled $1.7m (£1.4m). Initiatives have included four projects designed to remove 11,000 tonnes of CO2 from the atmosphere. 

Klarna believes that most carbon-offsetting activities aren’t as effective at combating climate change as those that extract CO2 already in the atmosphere, which is why it is focusing most of its attention on permanent carbon removal.

For its part, Ripple has committed $100m to invest in carbon-removal innovations, building carbon credits and enabling users to reduce their carbon footprint through a digitised credit token system. 

4. Commit to science-based targets

PayPal is targeting net-zero greenhouse gas emissions, as defined by the Science Based Targets Initiative (SBTI), by 2040. It has already achieved its goal of procuring 100% renewable energy for its data centres.

The company also has SBTI-based targets for reducing greenhouse gas emissions throughout its supply chain. It plans to achieve them partly by persuading vendors to set their own targets and work towards these. 

Visa has already achieved carbon neutrality in its own operations, according to its reporting under the Carbon Disclosure Project (CDP) framework. Moving all of its premises on to 100% renewable electricity has been key to its success in this respect.

Like PayPal, the company is targeting net-zero greenhouse gas emissions in its supply chain by 2040. It plans to do this by participating in the CDP Supply Chain programme, which encourages suppliers to measure their emissions, set reduction targets and report on their progress towards these. Visa also uses its supplier code of conduct to state its expectations of them in this respect.

5. Use tech that’s sustainable by design

Payment providers using digital assets and blockchains can evaluate and choose the most sustainable partners from the start.

At Ripple, Young acknowledges that the crypto sector has been put under scrutiny from the environmental lobby – justifiably so, because the process of verifying transactions on a blockchain consumes huge amounts of energy. But she adds that providers have been working to develop more sustainable crypto mining methods.

“We see great potential for blockchain and crypto to forge new paths to zero carbon,” Young says. “For example, the XRP Ledger blockchain is achieving carbon neutrality by confirming transactions through a low-energy consensus model.”



The post Five ways to help payments companies reach net zero appeared first on Raconteur.

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Power Plant in the sunrise

A few key players are in the vanguard of the payments industry’s decarbonisation charge. The insights they have gained so far are too important for them not to share


Power Plant in the sunrise

Payment service providers can play a pivotal role in supporting society’s move to a low-carbon economy, yet several are struggling to attain their own net-zero targets. Some strategies have been working well, but much more needs to be done – even by the largest and best-resourced players in the sector.

Payment providers should be well positioned to cut greenhouse gas emissions – in their operations, supply chains and customer networks – thanks to their ability to track spending and engage with buyers at the checkout. They can use their data insights and influence to raise customers’ awareness of their carbon footprints, inform them of their options and nudge them towards the most sustainable ones.

That’s the view of Doug Sabo, chief sustainability officer at Visa, whose network “connects billions of customers”. 

Sabo believes that his company has a “great opportunity to use its assets to inspire climate action through enabling sustainable behaviour. It’s also a chance for us and the payments industry to connect climate action to a business case, aligning with consumers’ demands and mitigating risks. We could do this by, for example, enabling seamless payments for electric vehicle charging.”

Here are five tips from pioneering payment providers on how the whole industry can hasten its progress towards net zero.

1. Rationalise and consolidate systems

One of the biggest contributors to payment companies’ carbon footprints is the electricity they use in their operations. 

To reduce its CO2 emissions, North American Bancard (NAB), parent of PayAnywhere, has consolidated its systems and operations from six separate data centres into two, both of which use 100% renewable electricity. It has also equipped its call centres with energy-efficient Chromebook devices. 

“We have learnt that competitively priced, environmentally friendly providers are out there,” says NAB’s chief information officer, Andy Bolin. “You just need to choose the right ones from the start. It’s easier to build a more sustainable ecosystem now than to reverse-engineer it later.”

2. Bring customers and networks on board

Perhaps the biggest opportunity for payments providers to cut CO2 emissions lies in engaging with their billions of customers and their huge supplier networks. 

A 2021 business briefing by the University of Cambridge recommends that providers work collaboratively to shape new services that will counter climate change. The document, Payments for Net Zero, also highlights providers’ ability to use data-driven insights to support this by, for example, producing more targeted products.

Sendi Young, MD of payments settlement system Ripple in Europe, says: “Organisations should prioritise learning from others and take advantage of partnerships. We need to work as a collective to make our industry fully sustainable.” 

To this end, Ripple has joined the Crypto Climate Accord, a group of crypto asset providers with the shared goal of decarbonising the industry.  

PayPal, meanwhile, is aiming to harness the power of its 400 million customers to advance science-based action and align its offerings with their growing interest in sustainability. For example, its network of so-called return bars – locations where shoppers can hand back unwanted goods – enables product returns to impose a smaller carbon footprint than they would make via any mailing system.

Organisations should prioritise learning from others and take advantage of partnerships. We need to work as a collective

A spokesman for PayPal says: “We’ve learnt that enabling climate solutions is not just about individual businesses; it’s also about markets and ecosystems. Innovation and entrepreneurship are also essential. We’ve invested in startup companies that are testing ideas that can unlock new climate solutions and address scalability issues.”

Sabo reports that Visa’s decarbonisation strategy has “evolved outside our operations. For payment companies, the transformative opportunity is to enable others to transition to a low-carbon economy by inspiring and empowering the consumers and businesses that use our services to make more sustainable choices.”

Visa has done this both directly with bank clients and via a partnership with Ecolytiq, which enables them to obtain estimates of the carbon footprint imposed by their spending habits. Clients also receive tailored guidance on how they could make more sustainable purchasing choices.

3. Invest directly in removing carbon

Buy-now-pay-later giant Klarna has introduced an internal tax on all its emissions, including in its supply chain. This entails setting aside money to spend on decarbonisation initiatives. 

Last year the fund totalled $1.7m (£1.4m). Initiatives have included four projects designed to remove 11,000 tonnes of CO2 from the atmosphere. 

Klarna believes that most carbon-offsetting activities aren’t as effective at combating climate change as those that extract CO2 already in the atmosphere, which is why it is focusing most of its attention on permanent carbon removal.

For its part, Ripple has committed $100m to invest in carbon-removal innovations, building carbon credits and enabling users to reduce their carbon footprint through a digitised credit token system. 

4. Commit to science-based targets

PayPal is targeting net-zero greenhouse gas emissions, as defined by the Science Based Targets Initiative (SBTI), by 2040. It has already achieved its goal of procuring 100% renewable energy for its data centres.

The company also has SBTI-based targets for reducing greenhouse gas emissions throughout its supply chain. It plans to achieve them partly by persuading vendors to set their own targets and work towards these. 

Visa has already achieved carbon neutrality in its own operations, according to its reporting under the Carbon Disclosure Project (CDP) framework. Moving all of its premises on to 100% renewable electricity has been key to its success in this respect.

Like PayPal, the company is targeting net-zero greenhouse gas emissions in its supply chain by 2040. It plans to do this by participating in the CDP Supply Chain programme, which encourages suppliers to measure their emissions, set reduction targets and report on their progress towards these. Visa also uses its supplier code of conduct to state its expectations of them in this respect.

5. Use tech that’s sustainable by design

Payment providers using digital assets and blockchains can evaluate and choose the most sustainable partners from the start.

At Ripple, Young acknowledges that the crypto sector has been put under scrutiny from the environmental lobby – justifiably so, because the process of verifying transactions on a blockchain consumes huge amounts of energy. But she adds that providers have been working to develop more sustainable crypto mining methods.

“We see great potential for blockchain and crypto to forge new paths to zero carbon,” Young says. “For example, the XRP Ledger blockchain is achieving carbon neutrality by confirming transactions through a low-energy consensus model.”



The post Five ways to help payments companies reach net zero appeared first on Raconteur.

]]>
How can childrenswear become more sustainable?  https://www.raconteur.net/sustainability/can-childrenswear-become-sustainable/ Tue, 09 Aug 2022 14:06:53 +0000 //www.raconteur.net/?p=157404

With infants outgrowing seven clothing sizes in their first two years, this segment is a significant contributor to the fashion industry’s waste problem 


There are 183 million items of outgrown baby clothes tucked away in homes around the UK, according to research by Mothercare and environmental charity Hubbub, which estimates that a typical British family spends £11,000 every year on childrenswear. 

Historically, the children’s clothing category has “acquired longevity, durability and continued reuse in the form of hand-me-downs, both within families and across friendship groups based on economy, convenience and need”. 

So says Dr Anne Peirson-Smith, senior lecturer, leader of Nottingham Trent University’s MA course in international fashion management and co-leader of its clothing sustainability research group. She observes that “the sharing trend appears to have surged recently and taken on new life. In the cost-of-living crisis, this will only become bigger.”

Despite this, Hubbub’s research also indicates that a third of British parents have binned garments that their children no longer need, simply because they don’t know what else to do with these outgrown clothes.

Opening up the wardrobe

The Little Loop is a rental service for childrenswear that was created by Charlotte Morley, who entered the BBC’s Dragons’ Den in January 2022 and convinced investors Deborah Meaden and Steven Bartlett to put £140,000 into her business. For a monthly subscription fee, users can choose clothing from a “shared wardrobe” of more than 10,000 items and then exchange these pieces for new ones whenever they wish. 

“The key to reducing the environmental impact of clothing is to increase the amount it is worn. Doubling the number of wears that a garment achieves will reduce its impact by 40%,” Morley says. “Every garment has the potential to be worn by multiple children – four to five on average. Yet the informal hand-me-down system is increasingly failing to work beyond the first few years of a child’s life, as parents become busier with their careers and less frequently connected to their network of fellow parents.”

If consumers can be made aware that there’s an easily accessible market for second-hand clothing, it can change their attitudes and increase their likelihood of continuing what she calls sharing behaviour, whereby parents and even children “take better care of their clothes as a result, increasing their lifespan further”.

Rental service providers such as The Little Loop help to “remove the inconvenience of having to sell on used items at a hugely reduced price. Parents simply swap one item for another when the time comes,” thereby making the idea of sharing rather than buying much more attractive, according to Morley.  

Designer solutions

Petit Pli, a producer of wearable tech founded in 2017 by aeronautical engineer Ryan Mario Yasin, is developing new material technologies aimed at creating clothes that will grow with a child. The firm’s COO, Arabell Turek, notes that the increasing acceptance of the sharing economy means that “a benefit of designing childrenswear that’s not for obsolescence is that the design can be shared between siblings and still enter the very important hand-me-down economy”. 

Petit Pli’s clothes are designed to grow with the child through seven sizes, preventing much of the wastage that would normally occur as the baby becomes a toddler and even a pre-schooler. The company would like its work to benefit the whole sector, says Turek, who adds: “Extending the usable life of garments is the best means for the clothing industry to reach its emission targets by 2030.”

Pursuing the very opposite of fast fashion is also giving Petit Pli the time and space to come up with ever more creative solutions. 

“By creating a longer-lasting product, we can offer users a competitively priced item over its lifespan, while pushing more innovative manufacturing capabilities,” Turek says. “We can also ensure that our supply chain adheres to the highest ethical standards, from the materials to the treatment of the people who make the garments. For instance, our manufacturing partner in Portugal derives certified 100% green energy for its facility.” 

Peirson-Smith agrees that “making children’s clothing more sustainable requires collaborative understanding, design education and community engagement throughout the value chain. There is also a need to increase consumers’ awareness of their role in enabling post-purchase solutions, from ethical purchasing to garment aftercare.”

Barriers to circularity

But she acknowledges that, as long as the high street’s standard offerings remain reasonably priced, not all parents will be keen to change their behaviour for the good of the planet. 

Peirson-Smith notes that “the largest sector for childrenswear sales is supermarket brands” such as Next (which had an 8.7% share of the UK market last year, according to Euromonitor), Primark (5.7%) and Marks & Spencer (4.7%). 

“These all offer good quality and design at low prices, along with being very convenient,” she says. “This means that small-scale circular business models are competing with the convenience and low prices available at traditional children’s clothing retailers, which also claim to be sourcing more sustainably and ethically.” 

Turek argues that the renting and reselling of children’s clothing comes with its own problems at both ends of the value chain. 

“There are huge operational costs and energy demands in managing the stock, as every garment is produced as a unique piece rather than manufactured as a batch,” she says. “Cleaning each item will have an impact on the environment. It’s also important to note the costs and emissions generated by customer returns.” 

She concedes that there are downsides to Petit Pli’s material innovation model, accepting that “the upfront costs are typically higher than with renting or resale – and the lead times are long”. 

Invention cannot be rushed, especially when its effects on the industry, the public and the environment must all be carefully weighed. The key, though, is to get consumers on board with new ways of buying, using and discarding childrenswear that will have minimal impact on the planet. 



The post How can childrenswear become more sustainable?  appeared first on Raconteur.

]]>

With infants outgrowing seven clothing sizes in their first two years, this segment is a significant contributor to the fashion industry’s waste problem 


There are 183 million items of outgrown baby clothes tucked away in homes around the UK, according to research by Mothercare and environmental charity Hubbub, which estimates that a typical British family spends £11,000 every year on childrenswear. 

Historically, the children’s clothing category has “acquired longevity, durability and continued reuse in the form of hand-me-downs, both within families and across friendship groups based on economy, convenience and need”. 

So says Dr Anne Peirson-Smith, senior lecturer, leader of Nottingham Trent University’s MA course in international fashion management and co-leader of its clothing sustainability research group. She observes that “the sharing trend appears to have surged recently and taken on new life. In the cost-of-living crisis, this will only become bigger.”

Despite this, Hubbub’s research also indicates that a third of British parents have binned garments that their children no longer need, simply because they don’t know what else to do with these outgrown clothes.

Opening up the wardrobe

The Little Loop is a rental service for childrenswear that was created by Charlotte Morley, who entered the BBC’s Dragons’ Den in January 2022 and convinced investors Deborah Meaden and Steven Bartlett to put £140,000 into her business. For a monthly subscription fee, users can choose clothing from a “shared wardrobe” of more than 10,000 items and then exchange these pieces for new ones whenever they wish. 

“The key to reducing the environmental impact of clothing is to increase the amount it is worn. Doubling the number of wears that a garment achieves will reduce its impact by 40%,” Morley says. “Every garment has the potential to be worn by multiple children – four to five on average. Yet the informal hand-me-down system is increasingly failing to work beyond the first few years of a child’s life, as parents become busier with their careers and less frequently connected to their network of fellow parents.”

If consumers can be made aware that there’s an easily accessible market for second-hand clothing, it can change their attitudes and increase their likelihood of continuing what she calls sharing behaviour, whereby parents and even children “take better care of their clothes as a result, increasing their lifespan further”.

Rental service providers such as The Little Loop help to “remove the inconvenience of having to sell on used items at a hugely reduced price. Parents simply swap one item for another when the time comes,” thereby making the idea of sharing rather than buying much more attractive, according to Morley.  

Designer solutions

Petit Pli, a producer of wearable tech founded in 2017 by aeronautical engineer Ryan Mario Yasin, is developing new material technologies aimed at creating clothes that will grow with a child. The firm’s COO, Arabell Turek, notes that the increasing acceptance of the sharing economy means that “a benefit of designing childrenswear that’s not for obsolescence is that the design can be shared between siblings and still enter the very important hand-me-down economy”. 

Petit Pli’s clothes are designed to grow with the child through seven sizes, preventing much of the wastage that would normally occur as the baby becomes a toddler and even a pre-schooler. The company would like its work to benefit the whole sector, says Turek, who adds: “Extending the usable life of garments is the best means for the clothing industry to reach its emission targets by 2030.”

Pursuing the very opposite of fast fashion is also giving Petit Pli the time and space to come up with ever more creative solutions. 

“By creating a longer-lasting product, we can offer users a competitively priced item over its lifespan, while pushing more innovative manufacturing capabilities,” Turek says. “We can also ensure that our supply chain adheres to the highest ethical standards, from the materials to the treatment of the people who make the garments. For instance, our manufacturing partner in Portugal derives certified 100% green energy for its facility.” 

Peirson-Smith agrees that “making children’s clothing more sustainable requires collaborative understanding, design education and community engagement throughout the value chain. There is also a need to increase consumers’ awareness of their role in enabling post-purchase solutions, from ethical purchasing to garment aftercare.”

Barriers to circularity

But she acknowledges that, as long as the high street’s standard offerings remain reasonably priced, not all parents will be keen to change their behaviour for the good of the planet. 

Peirson-Smith notes that “the largest sector for childrenswear sales is supermarket brands” such as Next (which had an 8.7% share of the UK market last year, according to Euromonitor), Primark (5.7%) and Marks & Spencer (4.7%). 

“These all offer good quality and design at low prices, along with being very convenient,” she says. “This means that small-scale circular business models are competing with the convenience and low prices available at traditional children’s clothing retailers, which also claim to be sourcing more sustainably and ethically.” 

Turek argues that the renting and reselling of children’s clothing comes with its own problems at both ends of the value chain. 

“There are huge operational costs and energy demands in managing the stock, as every garment is produced as a unique piece rather than manufactured as a batch,” she says. “Cleaning each item will have an impact on the environment. It’s also important to note the costs and emissions generated by customer returns.” 

She concedes that there are downsides to Petit Pli’s material innovation model, accepting that “the upfront costs are typically higher than with renting or resale – and the lead times are long”. 

Invention cannot be rushed, especially when its effects on the industry, the public and the environment must all be carefully weighed. The key, though, is to get consumers on board with new ways of buying, using and discarding childrenswear that will have minimal impact on the planet. 



The post How can childrenswear become more sustainable?  appeared first on Raconteur.

]]>
The chief operating officer: an ill-defined but crucial role https://www.raconteur.net/c-suite/coo-illdefine-crucial-role/ Tue, 09 Aug 2022 13:54:35 +0000 //www.raconteur.net/?p=157396

It’s considered one of the most challenging positions in the boardroom, yet the role of chief operating officer is one of the least understood, devoid of a clear job description and progression route


The chief operating officer has been described as the backbone of an organisation; the glue that connects the commercial strategy of the business with delivery and execution. Yet unlike other members of the C-suite, there isn’t a single description of what the role entails, nor is there a clearly defined route for becoming COO. 

Some COOs handle everything – from HR and finance to marketing – while others focus more on overseeing research and development, product strategy and supply-chain logistics. This appears to make the opportunity open to all contenders. 

However, with the business world facing unprecedented challenges, is there one function in particular from which chief operating officers are now more likely to emerge?

In recent years, the COO role has evolved from a predominantly operational focus to more of a deputy chief executive role, with a mandate for handling all the traditional operational responsibilities while leading a company’s most important strategic initiatives.

According to organisational psychologist Dr Lynda Folan, author of Leader Resilience: The New Frontier of Leadership, while this may look like a logical evolution, for many businesses, it is not necessarily an effective structural decision. She says: “The lack of definition of what this broader role requires, and the distinct lack of forethought on the succession for these roles, is a business risk – even more so in the volatile business setting of today, where failure is not an option.”

A high emotional quotient and the ability to manage change quickly – with strong communication to bring the whole business along – are critical

Many of today’s COOs have come from the revenue-driving commercial side of the organisation – the front end of the business – because that’s what drives the profits for many companies. But there are usually a lot of strings to a COO’s bow. 

“They might have come up the commercial route but have also spent time in sales operations, customer success or professional services delivery,” says Mike Drew, head of the technology practice at executive search firm Odgers Berndtson. 

“Historically, COOs have come from a services and customer success angle but we’re just as likely to see a COO come up via the front-end sales route as the back-end delivery route. Either way, they need to be able to meet in the middle and act as the conduit between the back end and the commercial front end.” 

Broader skill set

Regardless of the business function they come from, a potential COO needs to have perspectives on strategy, customer success, operational mechanics and service delivery, as well as commercial acumen. The most suitable COO candidates are therefore likely to be those with well-rounded backgrounds rather than narrow or specialist disciplines. 

“A marketing, HR or IT professional is unlikely to become a COO,” says Rachel Davis, co-managing director of talent insights firm Armstrong Craven. “A finance director who has led multiple functions – for example, procurement and IT, which often come under the umbrella of finance – or a sales leader with intimate knowledge of customers, markets, pricing, and therefore margins, would make a better candidate.”

One of the ways the ideal COO candidate requirements have changed in the past two or three years of economic disruption relates to their leadership attributes. “A high emotional quotient and the ability to manage change quickly – with strong communication to bring the whole business along – are critical and these aspects have definitely come to the fore over the past two to three years,” says Davis. “Command-and-control styles are no longer delivering.”

A successful COO understands the importance of the strategic partnership between their role and that of the chief executive. Natalia Shuliak joined data analytics platform DoubleCloud as COO earlier this year. She says: “You can’t be excellent at development, product and the commercial side of the business. At best, you can be great at two of those things.” 

The stronger the partnership of the COO and CEO, the greater the chances of them “building something solid”, she says, which is why the COO’s role is “never defined”. 

“For example, I'm strong in go-to-market and building a predictable machine, which is what I’ve done in the past in different roles, including marketing, business development, sales, and operations,” she explains. “As COO, I partner best with those who are great in development and product.”

Others insist that the financial, economic and operational challenges facing businesses today have created more opportunities to progress to COO from across all areas of an organisation. Katie Lee, former UK chief growth officer at global media agency Wavemaker, recently became the company’s COO. She sees the role as one that can adapt to the specific growth needs of the business and, as such, is open to candidates from any part of the business and from a variety of roles.

Preparing the next generation of COOs

Nevertheless, Folan insists that the recruitment of the COO should not be a default appointment from within the functional area of an organisation’s operations. With the breadth of the requirements of the evolving COO role, she thinks it unlikely that an executive with a traditional trajectory through operations would be an ideal candidate.

Leading at executive level, with such a range of functions necessary, “requires staff development with a strategic focus”, she says, adding that companies will run into difficulties if this aspect is ignored. 

“The appointment will be problematic unless the organisation systematically prepares those identified as having potential for the COO role.”  

And without a significant level of investment in that person's development before their appointment, she says, “they will likely face challenges in delivering the breadth of responsibility”. 

From COO to CEO

In most companies, the chief operating officer is second in command. If the chief executive is absent, it’s usually the COO who steps up, making them an obvious candidate for the top job. It is also a well-trodden path. ASOS recently promoted its COO, José Antonio Ramos Calamonte, to chief executive, while earlier this year, former Salesforce COO Bret Taylor moved into a co-chief executive role.

While the past few years have seen other function leaders make the transition to CEO – with the chief finance officer and chief human resources officer being popular candidates for the top job – the strategy-focused nature of the COO role makes it a natural pathway to becoming chief executive. But what really counts for any contender is the ability to flex multiple muscles outside their specialism.

“The CFO usually has a strong relationship with the CEO but, if they’re too focused on just the numbers or cost control of the business, they are unlikely to make a good CEO themselves,” says Drew. “Because the COO has such broad exposure, they’re less likely to fall into the trap of only being focused on one area.”   

Carl Uminski was co-founder and chief operating officer of digital product agency Somo until the start of this year, when he became its chief executive. “The CEO sets the strategy, manages investors and is accountable for the direction of the business, but it’s the COO who gets it there,” he says. 

A chief operating officer naturally makes a good CEO because they know how the company operates, and its strengths and weaknesses, he says. “However, the role immediately is less operational, less firefighting, less 'doing' and more strategic, which doesn't suit all personalities.”



The post The chief operating officer: an ill-defined but crucial role appeared first on Raconteur.

]]>

It’s considered one of the most challenging positions in the boardroom, yet the role of chief operating officer is one of the least understood, devoid of a clear job description and progression route


The chief operating officer has been described as the backbone of an organisation; the glue that connects the commercial strategy of the business with delivery and execution. Yet unlike other members of the C-suite, there isn’t a single description of what the role entails, nor is there a clearly defined route for becoming COO. 

Some COOs handle everything – from HR and finance to marketing – while others focus more on overseeing research and development, product strategy and supply-chain logistics. This appears to make the opportunity open to all contenders. 

However, with the business world facing unprecedented challenges, is there one function in particular from which chief operating officers are now more likely to emerge?

In recent years, the COO role has evolved from a predominantly operational focus to more of a deputy chief executive role, with a mandate for handling all the traditional operational responsibilities while leading a company’s most important strategic initiatives.

According to organisational psychologist Dr Lynda Folan, author of Leader Resilience: The New Frontier of Leadership, while this may look like a logical evolution, for many businesses, it is not necessarily an effective structural decision. She says: “The lack of definition of what this broader role requires, and the distinct lack of forethought on the succession for these roles, is a business risk – even more so in the volatile business setting of today, where failure is not an option.”

A high emotional quotient and the ability to manage change quickly – with strong communication to bring the whole business along – are critical

Many of today’s COOs have come from the revenue-driving commercial side of the organisation – the front end of the business – because that’s what drives the profits for many companies. But there are usually a lot of strings to a COO’s bow. 

“They might have come up the commercial route but have also spent time in sales operations, customer success or professional services delivery,” says Mike Drew, head of the technology practice at executive search firm Odgers Berndtson. 

“Historically, COOs have come from a services and customer success angle but we’re just as likely to see a COO come up via the front-end sales route as the back-end delivery route. Either way, they need to be able to meet in the middle and act as the conduit between the back end and the commercial front end.” 

Broader skill set

Regardless of the business function they come from, a potential COO needs to have perspectives on strategy, customer success, operational mechanics and service delivery, as well as commercial acumen. The most suitable COO candidates are therefore likely to be those with well-rounded backgrounds rather than narrow or specialist disciplines. 

“A marketing, HR or IT professional is unlikely to become a COO,” says Rachel Davis, co-managing director of talent insights firm Armstrong Craven. “A finance director who has led multiple functions – for example, procurement and IT, which often come under the umbrella of finance – or a sales leader with intimate knowledge of customers, markets, pricing, and therefore margins, would make a better candidate.”

One of the ways the ideal COO candidate requirements have changed in the past two or three years of economic disruption relates to their leadership attributes. “A high emotional quotient and the ability to manage change quickly – with strong communication to bring the whole business along – are critical and these aspects have definitely come to the fore over the past two to three years,” says Davis. “Command-and-control styles are no longer delivering.”

A successful COO understands the importance of the strategic partnership between their role and that of the chief executive. Natalia Shuliak joined data analytics platform DoubleCloud as COO earlier this year. She says: “You can’t be excellent at development, product and the commercial side of the business. At best, you can be great at two of those things.” 

The stronger the partnership of the COO and CEO, the greater the chances of them “building something solid”, she says, which is why the COO’s role is “never defined”. 

“For example, I'm strong in go-to-market and building a predictable machine, which is what I’ve done in the past in different roles, including marketing, business development, sales, and operations,” she explains. “As COO, I partner best with those who are great in development and product.”

Others insist that the financial, economic and operational challenges facing businesses today have created more opportunities to progress to COO from across all areas of an organisation. Katie Lee, former UK chief growth officer at global media agency Wavemaker, recently became the company’s COO. She sees the role as one that can adapt to the specific growth needs of the business and, as such, is open to candidates from any part of the business and from a variety of roles.

Preparing the next generation of COOs

Nevertheless, Folan insists that the recruitment of the COO should not be a default appointment from within the functional area of an organisation’s operations. With the breadth of the requirements of the evolving COO role, she thinks it unlikely that an executive with a traditional trajectory through operations would be an ideal candidate.

Leading at executive level, with such a range of functions necessary, “requires staff development with a strategic focus”, she says, adding that companies will run into difficulties if this aspect is ignored. 

“The appointment will be problematic unless the organisation systematically prepares those identified as having potential for the COO role.”  

And without a significant level of investment in that person's development before their appointment, she says, “they will likely face challenges in delivering the breadth of responsibility”. 

From COO to CEO

In most companies, the chief operating officer is second in command. If the chief executive is absent, it’s usually the COO who steps up, making them an obvious candidate for the top job. It is also a well-trodden path. ASOS recently promoted its COO, José Antonio Ramos Calamonte, to chief executive, while earlier this year, former Salesforce COO Bret Taylor moved into a co-chief executive role.

While the past few years have seen other function leaders make the transition to CEO – with the chief finance officer and chief human resources officer being popular candidates for the top job – the strategy-focused nature of the COO role makes it a natural pathway to becoming chief executive. But what really counts for any contender is the ability to flex multiple muscles outside their specialism.

“The CFO usually has a strong relationship with the CEO but, if they’re too focused on just the numbers or cost control of the business, they are unlikely to make a good CEO themselves,” says Drew. “Because the COO has such broad exposure, they’re less likely to fall into the trap of only being focused on one area.”   

Carl Uminski was co-founder and chief operating officer of digital product agency Somo until the start of this year, when he became its chief executive. “The CEO sets the strategy, manages investors and is accountable for the direction of the business, but it’s the COO who gets it there,” he says. 

A chief operating officer naturally makes a good CEO because they know how the company operates, and its strengths and weaknesses, he says. “However, the role immediately is less operational, less firefighting, less 'doing' and more strategic, which doesn't suit all personalities.”



The post The chief operating officer: an ill-defined but crucial role appeared first on Raconteur.

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Why air quality is the next net-zero challenge https://www.raconteur.net/sustainability/air-quality-net-zero-challenge/ Tue, 09 Aug 2022 13:50:00 +0000 //www.raconteur.net/?p=157388

Can we make buildings sufficiently energy-efficient to reach net zero by 2050 when the need for air quality has become so important?


As we move towards making homes energy-efficient, looking back may not be intuitive. But Graeme Fox, who is head of technical at the Building Engineering Services Association, suggests that is exactly what we should do. 

Fox points to homes that were built decades ago as having resonance in the design of today’s heating systems. The house he grew up in, for instance, had a central cupboard containing a warm air furnace, with ducts shooting off to different rooms: a central system that provided warm air from the building’s core.

After boilers and electric heating systems, technology has replicated something similar to that older design in mechanical ventilation heat recovery (MVHR). This more efficient system can provide around 3-3.5 kilowatts of heat for every kilowatt of electricity consumed. At the same time, it brings in new air from the outside and extracts stale, moist and polluted air, which improves indoor air quality. It significantly reduces energy used for heating as up to 91% of the heat from the extracted air can be retained and transferred to the incoming fresh air.

This is fundamental because buildings have ramped up energy-saving insulation, becoming more airtight and a lack of ventilation can have serious health implications. That’s why, on 15 June 2022, an update to Approved Document F of the Building Regulations came into effect, overhauling the UK’s rules on air quality and ventilation. Also updated was Approved Document L, which relates to the “conservation of fuel and power”. 

Anybody interested in buildings – how they work, how you design them – should be looking at ways to make them more efficient

The two updates go hand in hand, as better insulation will be essential to reach net zero. To address its challenges, some businesses are investing in their infrastructure, whether that means MVHR, heat pumps or water recovery systems. And while the significant cost of such systems can’t be disregarded, adopting the long-term approach is a spur to boost efforts to achieve net zero.

The refresh may help the UK deliver net zero by 2050 but the Covid-19 pandemic has had more than a minor role in pushing for better indoor air quality. 

It is also a step toward the Future Homes and Buildings Standard 2025. This new set of standards will ensure that homes built from 2025 will produce 75% to 80% less carbon emissions than under current regulations: the requirement is 30% this year. But some non-profits, such as the New Economics Foundation, say the benchmark has come too late after the scrapping of the zero-carbon homes standard in 2016, which would have forced net-zero carbon homes to be built by 2020.

Others believe the 2025 regulations should be set at or close to the Passive House standard (which aims to make heating and air conditioning systems obsolete) for fabric performance. A renewable heat requirement for new builds with a balanced retrofit target involving fabric improvements for existing buildings would also be welcome.

“Such a target, plus financial drivers such as an energy-saving stamp duty allowance, should also be announced now and implemented by 2025 so that the enormous task of improving all of the UK’s existing buildings can proceed in time to meet our 2050 net-zero targets,” says Jon Bootland, chief executive of the Passivhaus Trust.

Within industry, the new regulations are generally welcome, says Fox, as they provide needed clarity for the various applications of ventilation systems.

As well as MVHR, heat pumps are currently advocated with the government introducing a zero-rated fee. Fox says heat pumps have had a bad rep for high upfront costs but could be implemented more cheaply with split-level pumps.

“Outside of the sector, split-level pumps went under the radar. But they could be important in future home building,” he says.

Projects such as the Manchester Engineering Campus Development and the Devizes NHS Medical Centre are building smart, sustainable buildings that include energy efficiency and ventilation in their designs.

Benchmarks are there as guidance. You should never use them as the minimum

The Manchester development has technology-assisted window control to provide natural ventilation. It uses machine learning for automation and adapts according to occupant and energy needs. The Devizes medical centre is one of the UK’s first net-zero health facilities and uses heat pumps and solar panels for heat and electricity, saving around 25 tonnes of carbon a year. Its anticipated payback was 15 to 20 years, but the current energy crisis makes this likely to be sooner, according to a spokesperson for the project.

Retrofitting, however, is a difficult ask, explains Richard O’Brien, design director of housebuilder Northstone. This is because additional work is needed to adapt an older building, such as potentially adding more radiators. That’s why Northstone explored how every material used in a home could be made to work in its most sustainable way.

“Anybody interested in how buildings work, how you design them – should be looking at ways to make our buildings more efficient,” he says. “And it’s a continual process. Benchmarks are there as a guidance – never use them as the minimum.”

In a world where people are increasingly at risk of having to choose between warmth or food, working towards passive house principles could be powerful, says O’Brien. 

“Businesses are competitive by nature, so step changes need to be incremental to avoid a massive impact on your business financially,” he reasons.

For now, much advocacy is needed to get all the different parties involved in the construction chain – contractors, specifiers, manufacturers – on the same design page, so that these relatively new standards and features work together holistically.

While the technology evolves, flexibility can be useful. That way, when the next set of targets makes sustainable design even more urgent, having some built-in adaptability could prevent retrofitting from becoming the conundrum it is today.


Related articles


The post Why air quality is the next net-zero challenge appeared first on Raconteur.

]]>

Can we make buildings sufficiently energy-efficient to reach net zero by 2050 when the need for air quality has become so important?


As we move towards making homes energy-efficient, looking back may not be intuitive. But Graeme Fox, who is head of technical at the Building Engineering Services Association, suggests that is exactly what we should do. 

Fox points to homes that were built decades ago as having resonance in the design of today’s heating systems. The house he grew up in, for instance, had a central cupboard containing a warm air furnace, with ducts shooting off to different rooms: a central system that provided warm air from the building’s core.

After boilers and electric heating systems, technology has replicated something similar to that older design in mechanical ventilation heat recovery (MVHR). This more efficient system can provide around 3-3.5 kilowatts of heat for every kilowatt of electricity consumed. At the same time, it brings in new air from the outside and extracts stale, moist and polluted air, which improves indoor air quality. It significantly reduces energy used for heating as up to 91% of the heat from the extracted air can be retained and transferred to the incoming fresh air.

This is fundamental because buildings have ramped up energy-saving insulation, becoming more airtight and a lack of ventilation can have serious health implications. That’s why, on 15 June 2022, an update to Approved Document F of the Building Regulations came into effect, overhauling the UK’s rules on air quality and ventilation. Also updated was Approved Document L, which relates to the “conservation of fuel and power”. 

Anybody interested in buildings – how they work, how you design them – should be looking at ways to make them more efficient

The two updates go hand in hand, as better insulation will be essential to reach net zero. To address its challenges, some businesses are investing in their infrastructure, whether that means MVHR, heat pumps or water recovery systems. And while the significant cost of such systems can’t be disregarded, adopting the long-term approach is a spur to boost efforts to achieve net zero.

The refresh may help the UK deliver net zero by 2050 but the Covid-19 pandemic has had more than a minor role in pushing for better indoor air quality. 

It is also a step toward the Future Homes and Buildings Standard 2025. This new set of standards will ensure that homes built from 2025 will produce 75% to 80% less carbon emissions than under current regulations: the requirement is 30% this year. But some non-profits, such as the New Economics Foundation, say the benchmark has come too late after the scrapping of the zero-carbon homes standard in 2016, which would have forced net-zero carbon homes to be built by 2020.

Others believe the 2025 regulations should be set at or close to the Passive House standard (which aims to make heating and air conditioning systems obsolete) for fabric performance. A renewable heat requirement for new builds with a balanced retrofit target involving fabric improvements for existing buildings would also be welcome.

“Such a target, plus financial drivers such as an energy-saving stamp duty allowance, should also be announced now and implemented by 2025 so that the enormous task of improving all of the UK’s existing buildings can proceed in time to meet our 2050 net-zero targets,” says Jon Bootland, chief executive of the Passivhaus Trust.

Within industry, the new regulations are generally welcome, says Fox, as they provide needed clarity for the various applications of ventilation systems.

As well as MVHR, heat pumps are currently advocated with the government introducing a zero-rated fee. Fox says heat pumps have had a bad rep for high upfront costs but could be implemented more cheaply with split-level pumps.

“Outside of the sector, split-level pumps went under the radar. But they could be important in future home building,” he says.

Projects such as the Manchester Engineering Campus Development and the Devizes NHS Medical Centre are building smart, sustainable buildings that include energy efficiency and ventilation in their designs.

Benchmarks are there as guidance. You should never use them as the minimum

The Manchester development has technology-assisted window control to provide natural ventilation. It uses machine learning for automation and adapts according to occupant and energy needs. The Devizes medical centre is one of the UK’s first net-zero health facilities and uses heat pumps and solar panels for heat and electricity, saving around 25 tonnes of carbon a year. Its anticipated payback was 15 to 20 years, but the current energy crisis makes this likely to be sooner, according to a spokesperson for the project.

Retrofitting, however, is a difficult ask, explains Richard O’Brien, design director of housebuilder Northstone. This is because additional work is needed to adapt an older building, such as potentially adding more radiators. That’s why Northstone explored how every material used in a home could be made to work in its most sustainable way.

“Anybody interested in how buildings work, how you design them – should be looking at ways to make our buildings more efficient,” he says. “And it’s a continual process. Benchmarks are there as a guidance – never use them as the minimum.”

In a world where people are increasingly at risk of having to choose between warmth or food, working towards passive house principles could be powerful, says O’Brien. 

“Businesses are competitive by nature, so step changes need to be incremental to avoid a massive impact on your business financially,” he reasons.

For now, much advocacy is needed to get all the different parties involved in the construction chain – contractors, specifiers, manufacturers – on the same design page, so that these relatively new standards and features work together holistically.

While the technology evolves, flexibility can be useful. That way, when the next set of targets makes sustainable design even more urgent, having some built-in adaptability could prevent retrofitting from becoming the conundrum it is today.


Related articles


The post Why air quality is the next net-zero challenge appeared first on Raconteur.

]]>
How I became an… ethical hacker https://www.raconteur.net/how-became-a/how-i-became-an-ethical-hacker/ Mon, 08 Aug 2022 16:16:44 +0000 //www.raconteur.net/?p=157368 Ethical hacker Tommy DeVoss

With cybersecurity risk on the rise, savvy organisations should use ethical hackers to keep their organisations safe. But how do you become one?


Tommy DeVoss is obsessed with computers. His first interaction with the internet, when he was nine, launched a lifelong fascination which would lead him to spend nearly five years in federal prison before becoming a white-hat hacker who has earned more than $2m (£1.65m) in bug bounty payouts. 

Hackers fall into three categories: black hat, white hat, and grey hat. The black hats are cybercriminals, out for financial gain, revenge or simply to cause trouble. White hats exploit systems on behalf of companies, so they can identify and fix vulnerabilities. Grey hats tread the line between the two as they may hack illegally to uncover security issues which they offer to share with companies in exchange for a fee. 

The name comes from old Western movies, where viewers could tell the “goodies” from the “baddies” based on the colour of their headgear. Real black hats, however, are much harder to identify. And, it turns out, it can be fairly easy to become one. 

A hacker’s story

In 1993, DeVoss’s cousin and next-door neighbour got a dial-up internet connection. The developer who installed it also set them up with a chat programme. “I spent time hanging out in different chatrooms, just like any other young boy, looking for girls to talk to and making friends. And then one day I accidentally joined the wrong chatroom,” he recalls. 

The room DeVoss stumbled into turned out to be the domain of a prolific hacker who went by the alias Deez Nuts, or DZ. DeVoss was fascinated. He hung out in the chatroom waiting for others to join, then started asking lots of questions. This, it turned out, was a bad move when it came to getting into the good books of a 1990s hacker. 

“He kept banning me from the chatroom. Back then, every hacker was considered bad, so they were all paranoid, worried that anyone they didn’t know asking questions was a fed [member of the FBI] trying to get them in trouble,” he says.

I was never trying to hurt people. I was just doing it out of curiosity

Eventually, though, persistence paid off and DZ took DeVoss under his wing, sending him to Google to learn everything there was to know about hacking and setting him exercises to test his skills. Soon, DeVoss was breaking into the sites of major Fortune 500 companies and, occasionally, secure government systems. 

“The stuff I did as a black hat was almost never financially motivated. I was never trying to hurt people. I was just doing it out of curiosity,” he says.

Unfortunately, the federal police didn’t see it that way and, around the year 2000, DeVoss’s house was raided for the first time. As a minor, he received a slap on the wrist and a warning to stay away from computers, but it was impossible. He was hooked. 

“For me, computers are like an addiction,” he says. “I have ADHD so I tend to get obsessive over things and then lose interest when I become the best at it, but I always come back to hacking because I can never learn all there is to know about computer security. I can never hack every system, find every bug. I can never stop learning.”

As a result, DeVoss ended up spending almost five years in federal prison, on and off, for hacking. Over the course of his time in a courthouse, he was brought in front of the same judge three times, who eventually told him “that if I was ever in his courtroom again for a computer crime, he was going to give me life in prison. I was never willing to go down the illegal route again.”

After his final prison stint, which ended in November 2010, DeVoss got a job as a system admin for a tech startup in Richmond, Virginia, and avoided hacking until 2014. Around this time, he heard of HackerOne, a vulnerability coordination and bug bounty platform that connects organisations with penetration testers and cybersecurity experts.

“It looked too good to be true,” he says. “Companies were going to allow me to hack them and pay me for finding vulnerabilities? The risk versus reward was too high.” 

But over the next two years, DeVoss began to hear more about white-hat hacking and the work people were doing for HackerOne. Curiosity won and he started poking around on Yahoo, looking for vulnerabilities in its systems. In March 2016, he got his first payout. “They gave me a $300 bounty because a bug I found was disclosing sensitive information.” Since then, he has become only the sixth person on the platform to pass the $1m bounty mark.

Hackers can be a positive force for business

Demand for skills like DeVoss’s is set to rise. Global CEOs named cyber risks as the top threat to their business in 2022, according to a survey by PwC, while Deloitte found that 25% believe cyber attacks will disrupt the next 12 months of their business strategy. Gartner research shows that 88% of CEOs now see cybersecurity as a business risk, not merely a technology one. It’s never been a better time to be an ethical hacker

“The past decade has changed the public’s perception of hackers,” says DeVoss. “Every business should use the skills of the white-hat community. If a business is only pen testing once a year and bolstering security for compliance, it isn’t ready at all. It’s been proven that the systems of many companies, governments and other institutions would have been way less secure without ethical hackers.” 

He doesn’t think organisations will ever be able to beat those who are intent on hacking them. But he does believe that ethical hackers can help to level the playing field and teach organisations how to shore up their security proactively. 

The past decade has changed the public’s perception of hackers

“The ‘good guys' may keep up with black hats but will never get ahead of them. Cybercriminals are solely concerned with money and, especially when you’re dealing with state-backed groups, they can fear for their lives if they don’t get an attack right,” he says.

This higher level of motivation drives innovation too; cybercriminals are always working on finding the next vulnerability. “As soon as one thing stops working, the black hats are already working on the next thing.”

So, what does someone need to become a great ethical hacker? At its simplest level you need hacking skills and… a strong sense of ethics. Although lots of black hats do cross over to the white side, many companies still see employing a hacker with a history of cybercrime as too much of a risk. Regardless of this, there are certain factors any hacker will need to be successful in finding vulnerabilities. 

“Ethical hackers require research skills and time – and lots of it. I believe that anyone can learn to hack if they can put in the effort,” says DeVoss. “Some people see the money that can be made from hacking and think they can jump in and start hacking to make a profit. But most of us have been hacking for decades and the money didn’t start generating straight away. Successful white-hat hackers are patient and willing to fail.”

They are also willing to learn, he adds, thinking back to his early days in the chatroom with DZ. “I wanted to learn all this stuff and I was willing to put in the effort. So, after a while, he just decided I was worth teaching.” 

It appears there is money to be made and businesses to help for the next generation of computer enthusiasts. All they need is curiosity, patience and, perhaps, a mentor like Tommy DeVoss. 

Read more from the “How I became a…” series here



The post How I became an… ethical hacker appeared first on Raconteur.

]]>
Ethical hacker Tommy DeVoss

With cybersecurity risk on the rise, savvy organisations should use ethical hackers to keep their organisations safe. But how do you become one?


Tommy DeVoss is obsessed with computers. His first interaction with the internet, when he was nine, launched a lifelong fascination which would lead him to spend nearly five years in federal prison before becoming a white-hat hacker who has earned more than $2m (£1.65m) in bug bounty payouts. 

Hackers fall into three categories: black hat, white hat, and grey hat. The black hats are cybercriminals, out for financial gain, revenge or simply to cause trouble. White hats exploit systems on behalf of companies, so they can identify and fix vulnerabilities. Grey hats tread the line between the two as they may hack illegally to uncover security issues which they offer to share with companies in exchange for a fee. 

The name comes from old Western movies, where viewers could tell the “goodies” from the “baddies” based on the colour of their headgear. Real black hats, however, are much harder to identify. And, it turns out, it can be fairly easy to become one. 

A hacker’s story

In 1993, DeVoss’s cousin and next-door neighbour got a dial-up internet connection. The developer who installed it also set them up with a chat programme. “I spent time hanging out in different chatrooms, just like any other young boy, looking for girls to talk to and making friends. And then one day I accidentally joined the wrong chatroom,” he recalls. 

The room DeVoss stumbled into turned out to be the domain of a prolific hacker who went by the alias Deez Nuts, or DZ. DeVoss was fascinated. He hung out in the chatroom waiting for others to join, then started asking lots of questions. This, it turned out, was a bad move when it came to getting into the good books of a 1990s hacker. 

“He kept banning me from the chatroom. Back then, every hacker was considered bad, so they were all paranoid, worried that anyone they didn’t know asking questions was a fed [member of the FBI] trying to get them in trouble,” he says.

I was never trying to hurt people. I was just doing it out of curiosity

Eventually, though, persistence paid off and DZ took DeVoss under his wing, sending him to Google to learn everything there was to know about hacking and setting him exercises to test his skills. Soon, DeVoss was breaking into the sites of major Fortune 500 companies and, occasionally, secure government systems. 

“The stuff I did as a black hat was almost never financially motivated. I was never trying to hurt people. I was just doing it out of curiosity,” he says.

Unfortunately, the federal police didn’t see it that way and, around the year 2000, DeVoss’s house was raided for the first time. As a minor, he received a slap on the wrist and a warning to stay away from computers, but it was impossible. He was hooked. 

“For me, computers are like an addiction,” he says. “I have ADHD so I tend to get obsessive over things and then lose interest when I become the best at it, but I always come back to hacking because I can never learn all there is to know about computer security. I can never hack every system, find every bug. I can never stop learning.”

As a result, DeVoss ended up spending almost five years in federal prison, on and off, for hacking. Over the course of his time in a courthouse, he was brought in front of the same judge three times, who eventually told him “that if I was ever in his courtroom again for a computer crime, he was going to give me life in prison. I was never willing to go down the illegal route again.”

After his final prison stint, which ended in November 2010, DeVoss got a job as a system admin for a tech startup in Richmond, Virginia, and avoided hacking until 2014. Around this time, he heard of HackerOne, a vulnerability coordination and bug bounty platform that connects organisations with penetration testers and cybersecurity experts.

“It looked too good to be true,” he says. “Companies were going to allow me to hack them and pay me for finding vulnerabilities? The risk versus reward was too high.” 

But over the next two years, DeVoss began to hear more about white-hat hacking and the work people were doing for HackerOne. Curiosity won and he started poking around on Yahoo, looking for vulnerabilities in its systems. In March 2016, he got his first payout. “They gave me a $300 bounty because a bug I found was disclosing sensitive information.” Since then, he has become only the sixth person on the platform to pass the $1m bounty mark.

Hackers can be a positive force for business

Demand for skills like DeVoss’s is set to rise. Global CEOs named cyber risks as the top threat to their business in 2022, according to a survey by PwC, while Deloitte found that 25% believe cyber attacks will disrupt the next 12 months of their business strategy. Gartner research shows that 88% of CEOs now see cybersecurity as a business risk, not merely a technology one. It’s never been a better time to be an ethical hacker

“The past decade has changed the public’s perception of hackers,” says DeVoss. “Every business should use the skills of the white-hat community. If a business is only pen testing once a year and bolstering security for compliance, it isn’t ready at all. It’s been proven that the systems of many companies, governments and other institutions would have been way less secure without ethical hackers.” 

He doesn’t think organisations will ever be able to beat those who are intent on hacking them. But he does believe that ethical hackers can help to level the playing field and teach organisations how to shore up their security proactively. 

The past decade has changed the public’s perception of hackers

“The ‘good guys' may keep up with black hats but will never get ahead of them. Cybercriminals are solely concerned with money and, especially when you’re dealing with state-backed groups, they can fear for their lives if they don’t get an attack right,” he says.

This higher level of motivation drives innovation too; cybercriminals are always working on finding the next vulnerability. “As soon as one thing stops working, the black hats are already working on the next thing.”

So, what does someone need to become a great ethical hacker? At its simplest level you need hacking skills and… a strong sense of ethics. Although lots of black hats do cross over to the white side, many companies still see employing a hacker with a history of cybercrime as too much of a risk. Regardless of this, there are certain factors any hacker will need to be successful in finding vulnerabilities. 

“Ethical hackers require research skills and time – and lots of it. I believe that anyone can learn to hack if they can put in the effort,” says DeVoss. “Some people see the money that can be made from hacking and think they can jump in and start hacking to make a profit. But most of us have been hacking for decades and the money didn’t start generating straight away. Successful white-hat hackers are patient and willing to fail.”

They are also willing to learn, he adds, thinking back to his early days in the chatroom with DZ. “I wanted to learn all this stuff and I was willing to put in the effort. So, after a while, he just decided I was worth teaching.” 

It appears there is money to be made and businesses to help for the next generation of computer enthusiasts. All they need is curiosity, patience and, perhaps, a mentor like Tommy DeVoss. 

Read more from the “How I became a…” series here



The post How I became an… ethical hacker appeared first on Raconteur.

]]>
Anti-money laundering regulations: what the latest updates mean for business https://www.raconteur.net/legal/anti-money-laundering-regulations-what-the-latest-updates-mean-for-business/ Mon, 08 Aug 2022 14:39:04 +0000 //www.raconteur.net/?p=157362 Image of 100-dollar bills hanging on a washing line. If companies don't stay compliant with new anti-money laundering regulations they may be left hung out to dry

Organisations must carefully manage their strategies if they are to keep pace with updates to AML law


Image of 100-dollar bills hanging on a washing line. If companies don't stay compliant with new anti-money laundering regulations they may be left hung out to dry

Few regulations are more vital to the financial services sector than those which tackle anti-money laundering (AML). A significant challenge for businesses, however, is that the laws are ever-changing.

“The regulations are frequently updated to address developments in the financial services industry, the new methods criminals employ and the recommendations of international bodies. Although the fundamental aim of the regulations remains consistent, the AML regime is becoming more complex and we can expect the regulations to continue to evolve,” says Shaul Brazil, a partner at BCL Solicitors. 

Recent amendments to the regulations include the addition of further kinds of activity, such as cryptoasset businesses, the insertion of new high-risk factors to be taken into account when assessing the need for enhanced due diligence and the introduction of a requirement for firms to report discrepancies in beneficial ownership information.

The reach of AML regulations extends from global financial organisations to small startups. All of them, though, must satisfy a wide range of requirements. These include conducting risk assessments and implementing AML procedures such as due diligence on new customers, record-keeping, training, appointing compliance officers and making reports. 

Constant vigilance is required to satisfy some in particular, such as evaluation of customers (especially those who are high risk), monitoring transactions (including bank deposits), and detecting suspicious activities that might need to be reported to the relevant authorities. 

Exactly how effective an organisation’s AML controls are will depend on its risk profile, says Brazil. “There’s no one-size-fits-all and the policies and procedures that firms adopt must be appropriate to the nature, size and risk profile of their business.”

How companies can stay compliant

Whatever their size, firms should take a holistic view of the purpose of the AML regime to avoid compliance problems, he says. “The FCA has demonstrated in its recent enforcement actions that it is less concerned with the finer details of the AML procedures and more with their fundamental purpose. 

“Firms should avoid a tick-box approach. They can fall foul of the regulations, not because they haven’t implemented them on paper, but because they haven’t focused on their purpose and whether their procedures are operationally effective.” 

Clear documentation and processes that all staff can access and understand can certainly help, says James Alleyne, who is legal counsel at Kingsley Napley and formerly of the FCA. As a matter of good practice, he advises, firms should be proactive and not reactive. “Firms should constantly review and update their AML systems, so they’re tailored to the changing regulatory standards and political and market developments.” 

The policies and procedures that firms adopt must be appropriate to the nature, size and risk profile of their business

The risks for firms falling foul of AML regulations are, he warns, daunting. Investigations by the FCA, which supervises AML law compliance in the financial services sector, can be costly, time-consuming and may cause business disruption. While the FCA can provide feedback to firms with inadequate crime systems and controls, it can also impose penalties for past breaches. In the past few months alone, it has imposed some £15.7m in fines on several firms found guilty of regulatory failings.

For many organisations, technology is easing the compliance challenge. Customer due-diligence software is well used by newly established fintech consumer lender Tembo, recently named UK’s best mortgage broker and best newcomer at the British Banking Awards. 

“We’re a young, digital-only platform which operates in a relatively high-risk area and with multiple customers. We were warned at the outset that we could be a target for criminal activity,” say co-founder and CEO Richard Dana and compliance lead Ellie Riordan. “A key element of aiding compliance for us has been using technology to automatically cross-check customer data and verify customer identity and recognise potentially fraudulent behaviours.”

Staying up to date with anti-money laundering regulation

Crucially, commitment from senior management is not only expected by the FCA but is essential to create awareness of financial crime throughout an organisation. “It’s important to have a strong team culture and that starts with strong leadership, which sets the tone for compliance,” say Dana and Riordan. 

“You must ensure that your different teams work together effectively and that compliance is included right at the beginning of any change to operations or product. We have honest, open discussions about compliance and people are free to disclose mistakes or issues they’ve seen.”

Training is a required part of compliance and its content and delivery are both important, says Alleyne. “It’s good to have a practical dimension for training to be effective, like case studies, so that it isn’t overly academic.” He recommends organisations ensure that staff have properly understood their training by using tools like computerised tests and that they maintain training logs.

While the FCA Handbook includes a guide on financial crime, many organisations seek external support to help them handle the compliance burden. Some professional firms and compliance consultancies can advise on effective AML regulation compliance and help with investigations and prosecutions. They may also offer support like compliance technology and regulatory updates.

Heather O’Gorman is head of payment services and financial crime at compliance specialist Thistle Initiatives. She says: “Many of our clients are startups. They can struggle to find the right level of operational staff. We help them establish their AML frameworks and controls, including due diligence procedures and training programmes.”

Tembo used FSCompliance to help it draft policies that complied with FCA guidance on AML regulations and to advise on how to establish and implement its compliance systems. “They’ve helped us compare our setup with those of their other clients, so that we can be best in class,” say Dana and Riordan. It now uses FSCompliance on a retainer basis, which provides the organisation with a check-the-checker service. “It has been invaluable to have an adviser who has a detailed understanding of the application process and the ongoing regulatory system,” they report.

For their organisation and others, such alertness and energy are what is required to meet the ongoing compliance challenge. 



The post Anti-money laundering regulations: what the latest updates mean for business appeared first on Raconteur.

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Image of 100-dollar bills hanging on a washing line. If companies don't stay compliant with new anti-money laundering regulations they may be left hung out to dry

Organisations must carefully manage their strategies if they are to keep pace with updates to AML law


Image of 100-dollar bills hanging on a washing line. If companies don't stay compliant with new anti-money laundering regulations they may be left hung out to dry

Few regulations are more vital to the financial services sector than those which tackle anti-money laundering (AML). A significant challenge for businesses, however, is that the laws are ever-changing.

“The regulations are frequently updated to address developments in the financial services industry, the new methods criminals employ and the recommendations of international bodies. Although the fundamental aim of the regulations remains consistent, the AML regime is becoming more complex and we can expect the regulations to continue to evolve,” says Shaul Brazil, a partner at BCL Solicitors. 

Recent amendments to the regulations include the addition of further kinds of activity, such as cryptoasset businesses, the insertion of new high-risk factors to be taken into account when assessing the need for enhanced due diligence and the introduction of a requirement for firms to report discrepancies in beneficial ownership information.

The reach of AML regulations extends from global financial organisations to small startups. All of them, though, must satisfy a wide range of requirements. These include conducting risk assessments and implementing AML procedures such as due diligence on new customers, record-keeping, training, appointing compliance officers and making reports. 

Constant vigilance is required to satisfy some in particular, such as evaluation of customers (especially those who are high risk), monitoring transactions (including bank deposits), and detecting suspicious activities that might need to be reported to the relevant authorities. 

Exactly how effective an organisation’s AML controls are will depend on its risk profile, says Brazil. “There’s no one-size-fits-all and the policies and procedures that firms adopt must be appropriate to the nature, size and risk profile of their business.”

How companies can stay compliant

Whatever their size, firms should take a holistic view of the purpose of the AML regime to avoid compliance problems, he says. “The FCA has demonstrated in its recent enforcement actions that it is less concerned with the finer details of the AML procedures and more with their fundamental purpose. 

“Firms should avoid a tick-box approach. They can fall foul of the regulations, not because they haven’t implemented them on paper, but because they haven’t focused on their purpose and whether their procedures are operationally effective.” 

Clear documentation and processes that all staff can access and understand can certainly help, says James Alleyne, who is legal counsel at Kingsley Napley and formerly of the FCA. As a matter of good practice, he advises, firms should be proactive and not reactive. “Firms should constantly review and update their AML systems, so they’re tailored to the changing regulatory standards and political and market developments.” 

The policies and procedures that firms adopt must be appropriate to the nature, size and risk profile of their business

The risks for firms falling foul of AML regulations are, he warns, daunting. Investigations by the FCA, which supervises AML law compliance in the financial services sector, can be costly, time-consuming and may cause business disruption. While the FCA can provide feedback to firms with inadequate crime systems and controls, it can also impose penalties for past breaches. In the past few months alone, it has imposed some £15.7m in fines on several firms found guilty of regulatory failings.

For many organisations, technology is easing the compliance challenge. Customer due-diligence software is well used by newly established fintech consumer lender Tembo, recently named UK’s best mortgage broker and best newcomer at the British Banking Awards. 

“We’re a young, digital-only platform which operates in a relatively high-risk area and with multiple customers. We were warned at the outset that we could be a target for criminal activity,” say co-founder and CEO Richard Dana and compliance lead Ellie Riordan. “A key element of aiding compliance for us has been using technology to automatically cross-check customer data and verify customer identity and recognise potentially fraudulent behaviours.”

Staying up to date with anti-money laundering regulation

Crucially, commitment from senior management is not only expected by the FCA but is essential to create awareness of financial crime throughout an organisation. “It’s important to have a strong team culture and that starts with strong leadership, which sets the tone for compliance,” say Dana and Riordan. 

“You must ensure that your different teams work together effectively and that compliance is included right at the beginning of any change to operations or product. We have honest, open discussions about compliance and people are free to disclose mistakes or issues they’ve seen.”

Training is a required part of compliance and its content and delivery are both important, says Alleyne. “It’s good to have a practical dimension for training to be effective, like case studies, so that it isn’t overly academic.” He recommends organisations ensure that staff have properly understood their training by using tools like computerised tests and that they maintain training logs.

While the FCA Handbook includes a guide on financial crime, many organisations seek external support to help them handle the compliance burden. Some professional firms and compliance consultancies can advise on effective AML regulation compliance and help with investigations and prosecutions. They may also offer support like compliance technology and regulatory updates.

Heather O’Gorman is head of payment services and financial crime at compliance specialist Thistle Initiatives. She says: “Many of our clients are startups. They can struggle to find the right level of operational staff. We help them establish their AML frameworks and controls, including due diligence procedures and training programmes.”

Tembo used FSCompliance to help it draft policies that complied with FCA guidance on AML regulations and to advise on how to establish and implement its compliance systems. “They’ve helped us compare our setup with those of their other clients, so that we can be best in class,” say Dana and Riordan. It now uses FSCompliance on a retainer basis, which provides the organisation with a check-the-checker service. “It has been invaluable to have an adviser who has a detailed understanding of the application process and the ongoing regulatory system,” they report.

For their organisation and others, such alertness and energy are what is required to meet the ongoing compliance challenge. 



The post Anti-money laundering regulations: what the latest updates mean for business appeared first on Raconteur.

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Why fintechs are banking on the metaverse https://www.raconteur.net/finance/why-fintechs-are-banking-on-the-metaverse/ Mon, 08 Aug 2022 14:02:40 +0000 //www.raconteur.net/?p=157357 More and more fintechs are entering the metaverse

Traditional financial institutions are spending substantial sums on digital ‘plots of land’ in a bid to establish a presence in the virtual world. But are the rewards worth the risks?


Imagine a world where you, in avatar form, step into a bank branch, meet a customer service assistant, arrange a mortgage and sort out a query about your current account. No queues, no issues around business hours. Then you visit a virtual mall and buy a pair of trainers with your crypto wallet. 

Welcome to the metaverse.

This vision of the future may not be that far away. Now is the time for savvy financial services brands to decide whether to get metaverse-ready. The virtual world of products and services offers great opportunities but there are potential bumps in the road ahead, not least regulation and risk.

Which fintech players are readying for the metaverse?

There are two areas that fintechs are focusing on in the metaverse: first, allowing banking customers to virtually meet and communicate with bank staff, as well as transact, invest and purchase banking products. The second is experimenting with the gamification of financial services to enhance customer engagement. 

The large, traditional financial institutions are spending substantial sums to establish a presence, says Owen Wheatley, lead partner for banking and financial services with technology research and advisory firm ISG. “These include Citi, BNP Paribas and Fidelity,” he says. “They're trying to tap into new customer segments and, frankly, attempting to look ‘cool’.”

Other big names looking to capitalise on the metaverse potential are JPMorgan, which became the first bank to enter the metaverse, opening a lounge in Decentraland, a blockchain-based world, in February this year. A month later HSBC, which is closing bank branches in the physical world, bought a digital plot of land in The Sandbox, a digital gaming platform.

There's a land grab under way in the metaverse. Some have likened it to a digital version of the 19th century westward expansion in the US

Wheatley says that for fintechs and neobanks, the metaverse represents an extension of their use of technology to engage with customers digitally in a way that feels easy and fun. 

“There's a land grab under way in the metaverse,” he says. “Some have likened it to a digital version of the 19th century westward expansion in the US. Real estate seems to be one of the areas gaining the most traction.”

For fintechs and neobanks, the metaverse offers them an opportunity to expand their products to existing customers (who tend to be more tech savvy Gen Z or Millennials). Examples include crypto services, financing digital store fronts, digital investment advice and loyalty programmes in conjunction with metaverse retailers.

Gamification could increase engagement

One vision of the metaverse sees a new realm where global businesses offer parallel virtual experiences – including banking, insurance and mortgages – selling digital products and enhancing their brand.

Dave Pattman is managing director of customer services at Gobeyond Partners, part of the Webhelp Group, which already delivers services in The Sandbox. He believes that a big benefit for consumers will be the gamification of budgeting and financial management to drive engagement.

“For many consumers, money management can seem confusing and stressful,” he says. “The immersive nature of the metaverse creates opportunities for people to engage with their money in a more visual and personal way. In a virtual world, your savings objectives and life goals can be visualised in ways that provide more impactful motivation and behavioural change.”

That might mean being able to see and walk around in a world where your pension dreams are realised, or you already own the car of your dreams, which you are currently saving for in the physical world.

“Generations coming into the employment market today have been born and raised in the world of gaming,” he says. This will change the way they choose to interact with brands.

“People find it hard to budget and visualise their savings goals,” he says. “This is a really interesting space where you can see people gamifying real-life finance.”

Another key development in the metaverse will be the wider adoption of digital and cryptocurrencies, although for these to be accepted, they will need to become more reliable and less volatile, Pattman adds.

What role will regulation and fraud prevention play in the metaverse?

The brave new world of the metaverse offers huge potential for businesses, consumers and, unfortunately, criminals as well.

“Wherever money goes, crime follows,” says Pattman. “We already understand the sophistication of cyber criminals.” 

How, for example, do you reliably verify an identity in the metaverse when part of its appeal is that you can be somebody different there?

There are also issues around privacy and data collection. If you create an avatar to live and work and play in the metaverse, you may be tracked and analysed in a way that would seem intrusive in the physical world. This will raise data protection and privacy issues for consumers and a privacy headache for businesses.

Wheatley says the other risks for fintechs are over-expansion (trying to offer too many products to too many people through too many channels too quickly), which can easily become unsustainable, and becoming a “me too” player, with insufficient focus on creating differentiation. 

In fact, the very regulations that ensure financial services companies are trusted in the real world may be a barrier for them to enter the currently unregulated metaverse, says Pattman.

If a trusted and known bank appears in an unregulated environment, there is the potential for its brand to be harmed in the process. He suggests that metaverse start-ups have the advantage here because they are not regulated and do not have an existing real-world reputation to protect.

In addition, cybersecurity challenges are very different in the metaverse compared with the digital and online world, and businesses would do well to bear this in mind, says Kevin Gosschalk, founder and chief executive of Arkose Labs.

“Attacks targeting metaverse pioneers have significantly increased in the first half of 2022,” he says. Fintechs will be trying to grow as quickly as possible and, in doing so, they want to have the lowest friction in their onboarding process and the lowest checks that are necessary. This often exposes them to cybercriminal behaviour and risk of fraud.

The most sophisticated category of fraudsters – the master fraudsters – are already attacking consumers who are active in the metaverse, he says. 

“Fintechs investing in the metaverse must put a premium value on trust and safety. They must ensure the security of their account login, registration and in-platform actions to protect avatar identities in the world where real-time virtual, augmented and 3D merge, and become an experience like we've never seen before.”



The post Why fintechs are banking on the metaverse appeared first on Raconteur.

]]>
More and more fintechs are entering the metaverse

Traditional financial institutions are spending substantial sums on digital ‘plots of land’ in a bid to establish a presence in the virtual world. But are the rewards worth the risks?


Imagine a world where you, in avatar form, step into a bank branch, meet a customer service assistant, arrange a mortgage and sort out a query about your current account. No queues, no issues around business hours. Then you visit a virtual mall and buy a pair of trainers with your crypto wallet. 

Welcome to the metaverse.

This vision of the future may not be that far away. Now is the time for savvy financial services brands to decide whether to get metaverse-ready. The virtual world of products and services offers great opportunities but there are potential bumps in the road ahead, not least regulation and risk.

Which fintech players are readying for the metaverse?

There are two areas that fintechs are focusing on in the metaverse: first, allowing banking customers to virtually meet and communicate with bank staff, as well as transact, invest and purchase banking products. The second is experimenting with the gamification of financial services to enhance customer engagement. 

The large, traditional financial institutions are spending substantial sums to establish a presence, says Owen Wheatley, lead partner for banking and financial services with technology research and advisory firm ISG. “These include Citi, BNP Paribas and Fidelity,” he says. “They're trying to tap into new customer segments and, frankly, attempting to look ‘cool’.”

Other big names looking to capitalise on the metaverse potential are JPMorgan, which became the first bank to enter the metaverse, opening a lounge in Decentraland, a blockchain-based world, in February this year. A month later HSBC, which is closing bank branches in the physical world, bought a digital plot of land in The Sandbox, a digital gaming platform.

There's a land grab under way in the metaverse. Some have likened it to a digital version of the 19th century westward expansion in the US

Wheatley says that for fintechs and neobanks, the metaverse represents an extension of their use of technology to engage with customers digitally in a way that feels easy and fun. 

“There's a land grab under way in the metaverse,” he says. “Some have likened it to a digital version of the 19th century westward expansion in the US. Real estate seems to be one of the areas gaining the most traction.”

For fintechs and neobanks, the metaverse offers them an opportunity to expand their products to existing customers (who tend to be more tech savvy Gen Z or Millennials). Examples include crypto services, financing digital store fronts, digital investment advice and loyalty programmes in conjunction with metaverse retailers.

Gamification could increase engagement

One vision of the metaverse sees a new realm where global businesses offer parallel virtual experiences – including banking, insurance and mortgages – selling digital products and enhancing their brand.

Dave Pattman is managing director of customer services at Gobeyond Partners, part of the Webhelp Group, which already delivers services in The Sandbox. He believes that a big benefit for consumers will be the gamification of budgeting and financial management to drive engagement.

“For many consumers, money management can seem confusing and stressful,” he says. “The immersive nature of the metaverse creates opportunities for people to engage with their money in a more visual and personal way. In a virtual world, your savings objectives and life goals can be visualised in ways that provide more impactful motivation and behavioural change.”