Responsible governance: Beca Group’s “care” legacy

Beca Group executive chair Richard Aitken believes his company has been committed to responsible governance since its inception, which can be traced back to the 1920s. “Responsible governance has always underpinned the company ethos,” he says. “And it relates to every aspect of our work.”
That ethos has not, he says, been lost during the company’s long evolution or its consistent and increasingly global growth. Beca now employees more than 2500 people in seven countries, has an annual turnover of more $360 million and generates about 40 percent of this revenue offshore. It was last year’s Deloitte/Management magazine Top 200 Company of the Year.
“I think we have common-sense approach to responsible governance,” says Aitken. “What we do may not cover all the best practice theory, but we certainly try to practise what we preach.” And what the company preaches is care for its customers, employees, the community and the environment.
The company’s approach to doing business was instilled by “founders committed to the principle of taking responsibility” for things that happened, both externally with customers and internally, and to fixing things if there was problem. “I believe that every time you solve problem, the organisation is made stronger to tackle the next problem,” says Aitken.
Beca’s relatively new group chief executive Keith Reynolds – appointed in September 2009 as the first chief executive enlisted from outside the business – agrees Beca’s approach to caring for all its stakeholders, is deep rooted. There is, he says, an alignment between the board and the executive on both keeping and building on that legacy.
The company is, understandably, particularly focused on environmental sustainability and workplace safety. “But we are also focused on being holistically sustainable,” says Reynolds. The Beca Business Philosophy is articulated everywhere, particularly on its intranet. The company’s ongoing success is, it states, “achieved through financial strength and client focus; commitment to its people; community participation and environmental awareness”.
The priority the Beca board gives to responsible governance comes, in large measure, from the company’s ownership structure. Beca evolved from professional partnership to an employee-owned enterprise. About one third of its employees hold shares. This reality keeps responsible governance practices at the top of the board’s list of strategic priorities, says Aitken.
And because of services the company provides and the influence those services have on shaping the planet’s environment, it is environmental sustainability which most overtly testifies to its responsible governance practices, says Reynolds. “We treat our sustainable environment activities very seriously,” he adds.
The outcomes of thinking and acting responsibly are, in Aitken’s opinion,
manifest in Beca’s outstanding local and global business reputation. “Our commitment to acting responsibly has created our reputation and built our brand,” he says. “It is not by chance that when things go wrong, Beca is often called in.” He quotes number of engineering disasters the company has been enlisted to fix, ending with its now extensive involvement with the natural disaster that has devastated Christchurch.
“Our reputation for acting responsibly also helps us attract good people to our team,” says Reynolds. “And it differentiates us in the marketplace.”
“Our reputation is everything, particularly to our employees. Some of our harshest critics are internal,” says Aitken. “If they don’t believe we are walking the talk then we’ll end up with transfer of ownership problem.”
Beca is not listed company so there is no onus on it to adopt the Securities Commission’s Corporate Governance Principles in setting its responsible governance standards and approach. “But we are aware of them,” says Aitken “and I think you will find that we shape up pretty well with those principles.”
“We have developed our own guiding charter, based on best local and global practices. We are happy that what we have is aligned with some of the best responsible governance principles,” Reynolds adds.
The company doesn’t have written code of ethics “as such”. It uses its business philosophy to elaborate on its four pillars for success. It also elaborates on distributed sustainability statement that links back to the business philosophy.
It relies on its employment contracts and the ethical standards that apply to professional bodies its employees belong to as de facto substitute for an internally generated code. To Aitken’s mind, the terms, conditions and professional standards embodied in this array of material covers everything they might expect to include in company code – an eventuality Reynolds does not dismiss.
“We have complete suite of policies and procedures that you would expect of business of our size. variety of different behavioural codes apply across those policies,” says Reynolds. “We have not isolated out code of ethics but by virtue of the policies that we have, the terms of our contracts of engagement and the codes of the professional bodies that we are attached to, we believe we have this covered.”
When the company rubs up against practices, such as bribery, in some offshore markets, Beca applies its home-base ethical standards. “Our people are properly advised before they go to places where they might encounter unethical practices,” says Aitken. “We maintain our standards irrespective of the markets in which we operate. We have internal management processes to ensure that understanding is captured.”
The company continuously reviews its policies and practices, particularly where health and safety is concerned. Employees can, in confidence, raise issues with more senior managers if they are concerned that their direct report is not acting responsibly. It is not called whistle-blowing, but effectively is. “Employees can raise difficult issues in complete safety,” says Reynolds.
Beca’s commitment to sustainability and community participation is illustrated, in the first instance, by the production of comprehensive annual Sustainability Report which is lodged with the Business Council for Sustainability and, in second through its long-running support of the Karori Wildlife Sanctuary in Wellington.
The report outlines the vision and values that underscore the extensive range of sustainable activities that Beca is involved with. It details performance and measures results against stated goals.
The Karori project is 225-hectare sanctuary of lowland forest and wetlands surrounded by 8.6 kilometres of predator-proof fencing, which sits within five kilometres of the Beehive. Its vision is to restore piece of New Zealand as close as possible to the way it was before humans arrived, says Aitken. Beca employees provide volunteer support for the Trust and the company provides pro bono support to projects such as the design and build of the predator-proof fence, walking tracks, bridges and the restoration of wetlands in the sanctuary.
“We became involved because we had skills to offer but also because it was about restoring the environment,” says Aitken. “It was for the community and the vision was compelling. It was also inspiring for our people.” M