What gets measures gets managed

Here we go again into this bright new year

Thinking about how to benchmark the year just gone – and what to measure for the next one. 

Environmental, Social, Responsibility (ESG) seems to be a good place to start. Not just for professional but for my personal life too.

There is growing evidence that you can do well by doing good – that’s got to be a win-win – 

Investment in ESG-impact funds almost doubled to $51 billion in 2020. And consumers are voting with their feet – to quote the PWC report ‘Beyond compliance: Consumers and employees want business to do more on ESG’

“I will discontinue my relationship with companies that treat the environment, employees, or the community in which they operate poorly”

76% Consumers. PwC Consumer Intelligence Series June 2, 2021 This report focuses on employee motivation – one in three employees want to work for an organisation that shows responsibility toward all stakeholders.

Following COP26, the ‘E’ has been much in the headlines. This podcast with Mark Lien and US Department for Energy guest Dr Karma Sawyer suggests that we’ve probably reached peak energy efficiency in terms of product performance at least. Perhaps it’s time to look beyond the low-hanging fruit of lumens per watt and consider the whole life impact of lighting. The new Ecodesign Directive, the SLL’s TM-66 publication, the Green Light Alliance and Recolight initiatives are green shoots to nurture. Although as Florence Lam and others on our Drivers for Change panel in December pointed out, current reporting is opaque and inconsistent and does not cover the whole lifecycle of the product from sourcing to delivery and installation let alone performance in use. 

A harder dimension for investors – and for all of us – to assess is the ‘S’ or ‘Social’ impact. The BNP Parisbas 2019 Global ESG Survey revealed that 46% of investors found this to be the most challenging to analyse and integrate into investment strategies. ‘Social’ issues cover a wide range of topics: from consumer protection to product safety, labour law and safety at work, diversity, the fight against corruption and respect for human rights throughout the supply chain. It’s complicated, hard to measure – and, until relatively recently, seemed to be a ‘nice to have. And yet COVID might just have done some good here. ‘The Time Has Come’ report from KPMG showed that 96% of CEOs said their response to the pandemic had shifted their focus to the social component of ESG, up from 63% in August 2020. 99% of CEOs also said they had a stronger emotional connection to company purpose since the crisis began.

Good-quality lighting has a valuable part to play here too – beginning with daylight of course. The new standard for lighting in the workplace – EN12464-1 – recommends a tripling of the light levels in some situations. It also invites a more sophisticated approach to the delivery of light in a space to focus on the user needs rather than the traditional ‘one size fits all’ lux level on the horizontal plane. This reflects our growing understanding of the impact of light on the non-visual as much as the visual system – and the huge variation in personal preferences. Access to outside views and the right light at the right time – and darkness at night – are arguably most important to those who are most vulnerable – the young and the old and the chronically ill – and the shift workers who take care of them. The Danish Twin survey suggested that only around 20% of our life expectancy is a result of our genes – the rest – up to 80% – are directly linked to environmental and lifestyle factors.

And yet, this relatively small element of our personal and corporate budgets is all too often ‘value engineered’ to a bare minimum legal standard. The outcry over the new standard suggests there is still a long way to go before we are personally and collectively willing to invest in the ’S’. And the results are, sadly all too evident. The blokes in the electrical Trade Counters down here in Bridport just pointed to the energy rating on the website and had no idea what I was talking about when I asked about where the lights had come from – or whether they recycled them.

Finally – the G. Governance. Accountability. Transparency. The lighting industry is making progress but the supply chain is fragmented and shifting standards make it even harder to compare like with like – hardly surprising the consumer tends to plump for the cheapest when the numbers on the packet look the same and the marketing claims are either so vague or so extreme that they are no longer credible. There is a growing awareness of the way that this ultimately undermines the efforts of the best in the sector to improve accountability and transparency – and the business case to work together.

How can I raise the bar on my own ’ESG’ scores this year? 

 I’m taking a good hard look at my own carbon footprint – and working with the Town Council here to consider the whole life cost of their lighting upgrades and that of a new housing development on the edge of town. A rather more painful personal decision may be to bid fond farewell to my trusty, rusty diesel camper van. And a series of exciting events in the pipeline to build bridges between the lighting, scientific and ‘end user’ communities. Together we can deliver a ‘win-win-win’ – profitable, efficient and effective lighting solutions for all. 

The first – Very proud to announce that we’ve secured funding for a PhD with Professor Russell Foster and his team at Oxford University and the WCS Residential Care network to work out the key lighting parameters that affect quality of life for people living with dementia – and how those can be delivered in a real life ‘retrofit’ setting. I’m hosting a panel debate at the end of March to bring together best practice and key players more on that soon.

ESG in 2022?

Bring it on!