When Siemens UK Travel Commodity Manager Emma Eaton visited Business Travel Show Europe in London earlier this year, she was staying at a different hotel than the other host-buying buyers. Eaton checked itself into the Good Hotel London, a property she had recently added to Siemens’ preferred supplier list, not only because it meets the company’s quality and price standards, but also because it is a social enterprise.
Social enterprises are enterprises that devote at least 50 percent of their profits to philanthropy, such as education and support for disadvantaged people. In most cases, including Good Hotels’ parent company Good Group, the figure is 100 percent. All Good Group’s profits fund Niños de Guatemala, a foundation that provides education to 500 children in Central America. Good Hotel London also offers a training program for the long-term unemployed in Newham, the borough where it is located and one of the poorest in the UK
What is a social enterprise?
Good hotel London
Marten Dresen created the charity Niños de Guatemala, which runs three schools in the country, after doing volunteer work there. The schools not only educate children, but feed them and provide psychological support.
Frustrated with the constant pursuit of donations, Dresen created his own charity funding channel by starting Good Hotels as a social enterprise. Currently, there is one in Guatemala and one in London, with another scheduled for Guatemala soon.
Good Hotel London, which also trains unemployed locals, is a floating hotel moored next to the ExCel exhibition center. Good group leader for the community, Maria O’Connor, said the hotel’s social credentials are increasingly attracting corporate guests. “There’s a lot of momentum on the back of COP26. Companies are getting more engaged,” she said.
The house St. Barnabas
This member club of the London Soho House, where Charles Dickens wrote A story about two cities can be rented in whole or in part as a meeting place. The House of St. Barnabas works as a charity that supports the homeless. Many become employees who receive eight weeks of full-time training and all kinds of other support.
“Our corporate membership has increased significantly this year,” said the House of St. Barnaba’s CEO Rosie Ferguson. “If you can spend your money in a place that has a high social impact and is a very good meeting place, then why would not you? Buying social grows.”
Eaton is one of a small but growing number of travel and meeting leaders aiming to buy socially, a phase she defines as “the ability of companies to use their purchasing power to do good. Instead of just spending our purchasing volume through traditional routes, it looks at buying from the many wonderful organizations that exist to improve the lives of people who need help. ”
Another convert is Faye Carter, London-based executive of Deloitte. Like Siemens, Deloitte is one of 30 large companies that have participated in the Buying Social Corporate Challenge, which aims to get them to spend £ 1 billion annually through social enterprises.
Deloitte has already used Connection Crew, a community interest company that employs, trains, and generally supports the homeless, to build stages and provide other support at events. It also hired Luminary Bakery, which educates and employs socially disadvantaged women, for a virtual “bakealong” as a Christmas staff activity.
“Our goal is to increase spending with social enterprises next year,” Carter said. “Why not spend money on companies that maximize their impact on society and the environment?”
A changing mindset for purchasing
It’s a feeling that is wholeheartedly endorsed by Eaton. “Instead of being part of an isolated business world, you are actually doing something good in society, which I feel with the size of our purchasing volume, we have an obligation to do,” she said. “I see it more and more as a duty than something nice to do.”
The entire Siemens UK supply chain team was actively engaged in buying socially two years ago. “I was then able to think about how I should apply it to my purchasing approach and communication,” Eaton said. “For the last six months, it’s felt like it’s really accelerated. It’s seeping through many different parts of our organization now, not only within central supply chain management, but also out to our divisions.”
Outside of travel, Siemens has replaced its global stationery supplier in the UK with WildHearts Office, a social enterprise whose profits go to a fund that addresses gender inequality and offers entrepreneurship education to people with disadvantaged backgrounds.
Social Enterprise UK, the body that created the Buying Social Corporate Challenge, measures corporate spending with social enterprises in relation to the number of lives that are positively impacted. “Through this metric, we have set ourselves a goal of positively impacting as many lives as we have employees,” Eaton said. “We hope to achieve one-on-one by the end of 2022.”
How far this goal can be achieved through travel and meeting sourcing is still unknown. “For travel, it’s a huge challenge,” Eaton said. “We only have two hotels as direct suppliers. There are no airlines that are social enterprises; there are no train operators, car rental providers or anything like that. That makes it difficult because you obviously have the most influence on your first line of suppliers. ”
The situation is healthier for meetings, with a large number of places to choose from (see the sidebar for an example). For transient travel, according to Eaton, buyers need to think more in terms of secondary suppliers, in other words, the supply chain used by direct suppliers.
It has become more understood now that sometimes it costs more to be more ethical and do the right thing. But if goods are going to cost more, then you are thinking more carefully about your consumption of them. So in purchasing terms, it’s about demand management. “
– Siemens Emma Eaten
“There is a wonderful range of social businesses that the hotel and travel industry could use,” she said. “Even if they just had to build one or two in when you think about the number of chains that are, it’s huge.”
Social Enterprise UK has provided Eaton with a list of potential secondary suppliers, including suppliers of tea, coffee, beer, wine, toiletries, stationery and plants. An example is Change Please, a coffee company whose entire profits are spent on reducing homelessness. Since 2019, its coffee has been used by Virgin Atlantic both in the air and in its lounges.
Eaton addressed the purchase of social media in its hotel request process for proposals for 2022. She discussed the topic in a virtual conference session with potential vendors and included a question on the use of social enterprises in the RFP itself. “We also ask if they buy locally because from an environmental as well as a social perspective it is very beneficial and I do not want to discourage such suppliers because they are not social enterprises,” Eaton said.
Answers to her RFP questions will be crucial to Eaton’s property choices. “Where there is a good choice in the market, I will definitely use it as one of my main decision criteria,” she said.
Eaton met a mixed response from hotels in terms of knowledge levels and sincere commitment. She also acknowledges that many hotels are simply struggling to survive Covid. But if nothing else, “it saw a seed with those hotels, and hopefully that seed will grow, so when the pressure is a little more economical, it’s something they can revisit,” she said.
The issue of cost and other challenges
There are conceivable challenges in buying socially in addition to the lack of social enterprises in the travel sector. Eaton handles each of them comfortably. The first is whether it costs more. Eaton believes that this issue should be addressed in the context of human costs when a cheap supply is built on child or slave labor or, more often, legal but miserable working conditions.
“Everyone has had to reconsider their ethics,” Eaton said. “It has become more understood now that sometimes it costs more to be more ethical and do the right thing. But if goods are going to cost more, then you think more carefully about your consumption of them. So when it comes to shopping, it’s about demand management.
“And it is not always that things are more expensive. If I look at the example of the Good Hotel, it is well within our price cap. And knowing that our expenses are doing something good for society is far more valuable than swimming in a pool at another hotel nearby. ”
Another potential concern is supplier failure. “Most social enterprises are very small, so that’s a risk,” she admitted. “One would always have a contingency plan in place for critical suppliers, but social enterprises tend not to be critical suppliers. They do not produce chemical ingredients. They produce simple goods and services that can be replaced if the need arises.”
Finally, there is the issue of quality. “Understandably, the terrible challenges that some people trained by these organizations have had to work through in their lives mean that they may not always provide the same customer service as someone with decades of experience in the field,” Eaton said. “You need a little compassion and empathy to understand sometimes that it’s harder for them.
“There are pros and cons to everything, but if you make people internally aware of the peculiarities of social enterprises and the need to weigh up the benefits provided, then hopefully there will be that level of understanding. But if there are improvements to be made, then we, as with any vendor, no matter who they are, would work with them to communicate that and improve. ”
That said, neither Eaton nor Carter have had any bad experiences with social media. On the contrary, because social enterprises think differently from large corporations, they often offer much more distinctive service. Good Hotels, for example, have no television in the bedrooms. Instead, guests are encouraged to mingle in the area below, known as the “living room”. Eaton spent two happy hours there during her stay making new acquaintances with whom she stays in touch.
Likewise, meeting places for social enterprises are often more interesting than standard hotels. And as a bonus, Carter said, social enterprise executives are excellent speakers. “Invite them to come and talk at your event,” she said. “We have had really good experiences. Many of them have fantastic stories to tell.”
For any travel buyer considering buying socially, Eaton offers encouragement. “Start conversations with people who are already involved in social enterprises,” she said. “You will realize how easy it is to change people’s lives just by doing your daily work.”