Ripple effect

08 Aug 2008Archived News Energetics in the News

Published: AFR Boss by Andrew Cornell and Narelle Hooper - Energetics is mentioned as a sponsor of The Great Barrier Reef foundation.


When business and science get together they can make for a powerful partnership that goes beyond altruism

Judy Stewart, the managing director of the Great Barrier Reef Foundation, is watching the BHP Billiton hostile bid for Rio Tinto with more than a little vested interest. The mining giants are two of her biggest partners in two of the research foundation’s biggest projects in 2005, Rio Tinto Aluminium co-founded the $1 –million Future Reef partnership with the University of Queensland to research the potential impact of increasing levels of carbon dioxide on the great Barrier reef. And last year the foundation joined BHP and the Australian institute of Marine Science (AIMS) in CReefs, a four-year, $3.4-million initiative to investigate reef diversity.

“It will be very interesting…” Stewart hazards mildly, but she is encouraged by one particular element of cultural similarity between the two resource behemoths: both recognize the substantial value of projects such as these. Value which goes beyond corporate branding, and even the increasingly important concept of a “licence to operate” in a community.
“We don’t see investments like these as particularly philanthropic,” she says. “That wouldn’t be sustainable. It needs to be win/win and it needs to help the business.”

The foundation is an example of what can be achieved in an effective public-private partnership. Established in 1999 by business leaders who were concerned about the reef’s future, the foundation aims to increase the pool of funding available for research and to ensure it is targeted to get the best effect in reef management strategies. Its role is to broker the relationship between business and science, and to tap private resources to fund research on the reef covering biodiversity, the impact of climate change and water qulity. The Great Barrier Reef, which generates more than $6 billion in economic income annually, has been identified as one of the world’s natural eco-systems most vulnerable to climate change, which predictions of catastrophic outcomes in decades to come from warming atmospheric and ocean temperatures. Since the foundation’s inception, it has raised more than $11 million from the private sector, business and philanthropy.

“We’ve ended up working very closely with the business community.” Says Stewart. “There’s a real appetite in business to do things around sustainability very practically and creatively. They’re looking for very practical ways to get involved.”

Stewart works closely with the foundation’s chair, Commonwealth Bank chairman John Schubert, and an increasing number of companies that have dived in to support the foundation’s work. Their most successful achievement has been the Chairman’s Panel, which has grown from five to include 33 prominent business leaders who return to meet annually on the reed with leading scientists. The purpose of the panel is to deliver awareness of the issues confronting the reef first-hand: a day of presentations by the marine scientists and everyone goes into the water. Recent additions include Commonwealth Bank chief Ralph Norris, Telstra’s chief executive Sol Trujillo and Qantas CEO Geoff Dixon.

The panel was initially about raising money to keep the foundation’s doors open but it has had powerful ripple effects. “By taking the CEOs up to the reef we really educated them about the vulnerability of the research,” she says. “As a result of that we have been able to recruit more funds. And now we’ve expanded that to company-wide education programs. We’ve taken the panel from the top level right through the company. The message we’ve hd back from chief executives is ‘we’re interested in research but how can we involve our people?”

This month the foundation will run its first trip to the reef for employees, with staff from the Commonwealth Bank and Energetics traveling out to meet the reef scientists. Stewart says it shows there are practical things that can be done for a “problem that looks scary and remote and impossible”.

The partnerships that have emerged through the foundation’s research program provide an example of the triple bottom line in practice – business demonstrating a commitment to the principles it is selling to stakeholders, enhancing its reputation in the community at a time when that is an increasingly important tool for recruitment and, in some cases, receiving scientific data of direct import to operations.

BHP, for example, as an operator on the reef, has an interest in measuring biodiversity in order to quantify any impacts from its operations. Rio Tinto Aluminium, part of what is the world’s most energy-intensive industry, has an obvious interest in understanding the impact of increased carbon dioxide take-up – hence increased acidification – in the oceans.

Both companies clearly understand they face a changing operating and regulatory environment under climate change and want the best quality data on their own impact before making what can be billion-dollar decisions.

“By supporting science within a partnership structure, the scope is there for business to generate reputational benefits,” says Stewart. “We structure a partnership so that is provides regular opportunities to engage with a range of agreed stakeholders – legislators, regulators, other Reef users – at various milestones.”

Stewart, who graduated as a lawyer and was admitted to the bar before raising four children, saw an opportunity to get the business and scientific communities communicating when she was appointed to the board of the Australian Chamber Orchestra in Queensland and became chair of the Australian Festival of Chamber Music in Townsville.

“We had this audience, of older, well-educated people who were interested in the environment. So I started a series called Reef Talk and I got to know the scientists,” she says. When the chief executive’s position at the foundation came up, the scientists encouraged her to apply.

Five years on, she has welcomed the impetus from Ross Garnaut’s climate change review. “here’s Garnaut invoking the (impacts on the) Great Barrier Reef as one of the reasons to get behind the emissions trading system. I think awareness of climate change and Australia is converging around the reef to an extent. That has meant a huge growth in our business.”

The corporates are keen to have the foundation involved, auditing projects, liaising with scientists and structuring partnerships. BHP’s vice-president of sustainable development and community relations, Ian Wood, says: “We don’t have the resources internally to decide which is the right project or deal with the research institutions.”

Such projects are integral to BHP’s commitment to sustainable development. “Part of that is to ensure that our host communities benefit from their relationship with us,” Wood says. And there’s an added benefit: “Projects like these link directly to staff retention. Young graduates don’t want to work for companies which leave negative legacies, and we know from experience countries where we are looking to develop resources look at these initiatives.”

The return for science is not simply dollars. To use the jargon of marketing, partners such as BHP and Rio bring “money-can’t-buy” opportunities. For example, scientists can get access to BHP’s high-tech geological visualizations – crucial for exploration but invaluable to marine science. AIMS has only a few research vessels but Rio Tinto Marine has five new bulk carriers to be used like haul trucks on water. There is the opportunity to equip those ships with on-board sensors, collecting immensely more data than would otherwise be available to researchers.

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