Blog: Co-op chief Marks urges peers to do business sustainably
Dean Best | 26 June 2012
After Marks and Spencer chief executive Marc Bolland's recent calls for industry to do more on sustainability - and he repeated those again today - Peter Marks, boss of rival UK retailer The Co-operative Group, underlined why he believed companies need to put the issue at the heart of how they do business.
Speaking at a conference held by the British Retail Consortium in London, Marks claimed consumers were putting more importance on environmental, social and ethical issues. Companies, he said, needed to react.
"There has been a real sea change in the attitude of people, consumers particularly, when it comes to the social purpose, the impact that businesses have on communities and societies in general," Marks said.
The Co-op is a UK retailer owned by its members and has long promoted itself as an "ethical" retailer, focusing on issues like Fairtrade.
Marks admitted The Co-op was "not immune to making mistakes". He pointed to its banking retail arm "getting caught up in PPI selling" and highlighted a TV documentary that exposed problems in its funeral business.
However, he said: "We do reckon we try harder than most to be as ethical as we can. It is hard. Ethics is a nebulous subject. What is ethical to you can be different to what is ethical to me. But any business that ignores its social impact, its social purpose is ultimately going to be in trouble."
The Co-op is the UK's fifth-largest food retailer, with sales of around GBP13bn. However, its business structure includes a board of 20 directors appointed by its 7m member shareholders. Marks said that structure creates a "healthy tension" between running a commercially successful business and one that pursues ethical goals. "Sometimes in our boardroom, profitability is the last thing on our minds," he said, outlining the different factors he has to weigh up when leading the business. "We don't have shareholders to worry about; we just have 7m owners with 7m opinions about how the business should be run."
Marks acknowledged that, in its history, the Co-op had "lost its way" He said: "It became too worried about its principles and not worried enough about commercial goals. We have had to rebalance that over the last few years. Keeping it in balance is tough."
However, in a final plea to industry, he added: "We have to be aware of our impact not just on society but on the environment as well. We've got to get beyond thinking financial profit and dividend value as the only measures of success. They are fundamentally important but not to the exclusion of any other consideration."
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