The Body Shop - Business and Social Responsibility

A very thought provoking and practical paper, examining the issues and realities of the community sector forming partnerships with the business sector.

Broken Hill Community Round Table Forum

Saturday 29th July 2000

Keynote Address 

Barrie Thomas
The Body Shop New Zealand

I have been asked to speak to you today about The Body Shop - what it is, what community projects we are involved in, what we believe about the responsibilities of businesses in the world today, and also to tell you the story of my involvement with The Body Shop.

Firstly, what is The Body Shop? The Body Shop is simply a retailer of skin and hair-care products. A wonderful person called Anita Roddick started it in England in 1976. Her husband Gordon wanted to fulfil a lifetime ambition of horse-riding from Buenos Aires to New York in the footsteps of a Swiss explorer, Aime Tschiffley. The proposed trip was to take two years.

Anita came up with a plan to support her and her two baby daughters by opening a small shop selling bath and hair-care products in simple, refillable bottles completely lacking all the hype traditionally associated with the cosmetics industry. From these humble beginnings grew a business which now consists of 1700 stores across 48 countries, and with annual retail sales of over $1 billion.

Until last year my business partner and I held the head franchise of The Body Shop for Australia and New Zealand, but I have since sold my Australian interests to my former partner and now operate as head franchisee for The Body Shop New Zealand.

How did I get involved in The Body Shop? It is a fairly convoluted tale, but I will give you the quick version. I am a social worker by training. After working with the Department of Aboriginal Affairs in Adelaide in the early ‘70s, I decided to pursue professional qualifications, which I completed in 1974. I then left Adelaide for New Zealand where I spent a few years working in alcohol and drug dependency services before returning to Adelaide to work with the South Australian Royal Commission into the Non-Medical Use of Drugs. After the Commission finished its work I decided to travel to England to broaden my social work experience.

Unfortunately, I soon found that although employers in England would accept my Australian qualifications, they would not recognise my social work experience. This meant that if I wanted to work in England as a social worker, I would have to start at the bottom of the professional ladder again, which I was not keen to do. While considering my options, I was offered a trainee management position with Wimpy International, at that stage the largest fast-food company in Britain. I decided to accept, completed the training, managed a small store, and then was promoted to store manager of the new outlet in Piccadilly Circus in London. It was a very large store with 100 staff, and while it was incredibly busy it was great fun to be managing.

About that time, representatives from the Myer stores in Melbourne were visiting London searching for a fast-food franchise to introduce into Australia. They visited my store, liked it and decided to take on the Wimpy franchise. They employed me to come back to Melbourne to establish the franchise. They also employed another fellow called Graeme Wise to head up their franchising division. This was 1982, and for the first part of that year Graeme and I spent most of our time working towards opening the first Wimpy store, but we were also working on another small franchise in which Myer had shown interest. It was The Body Shop.

Part way through that year, Myer decided not to proceed with the Wimpy franchise, so then Graeme and I devoted our efforts to evaluating The Body Shop as a potential franchise. Finally, around Christmas Myer informed us that the franchising division was to be closed and our services were no longer required.

Once Myer officially no longer required us, we contacted Gordon Roddick, told him what had happened and that we would like to take on the franchise ourselves. We met with Anita and Gordon Roddick in February 1983, undertook some initial training, signed the franchise agreement and came home.

This is when the hard work commenced. After a struggle to find premises, we opened our first store in Melbourne on July 1^st 1983. Our first shop was never an overwhelming success in terms of turnover, but it did attract the attention of retail landlords and very soon we were invited into two major retail developments in Melbourne.

By the end of our first full year we had opened five stores. Over the next few years, we just grew until now where there are 70 shops throughout Australia and 15 in New Zealand. Retail turnover is close to $90,000,000 and we have some 900 employees. Last year I felt it was time for a change and I sold my shares of The Body Shop Australia to Graeme and he sold his shares in The Body Shop New Zealand to me.

As I said previously, there are now over 1700 branches of The Body Shop around the world in 48 countries. It truly is a global brand and probably Britain’s most successful international retailer. How has this happened? What has been the reason for our success? Of course there is no one simple answer. Yes, we have a good product, but no better than many others on the market.

For me the real key is that we are a values-led company. What does this mean? It means that we have strong views about our responsibilities and our role in society, and that making a profit is not by itself sufficient. Profit is necessary for a business, but by itself it is not enough. Does it really make employees happy to work for a company whose sole motivation is to make profits for the shareholders? Our experience and research suggests that it does not.

However, if they work with a company which believes it is part of the community and that community problems are part of its responsibility, then we have a different situation. This gives employees a greater sense of achievement, a sense that their work has meaning.

If the values of the company and the values of the staff are in alignment then I think the company will have a very motivated work force and, all other things being equal, the company will prosper. A growing number of business organisations both in Australia and overseas are coming to the same conclusion.

The mission statement of The Body Shop starts

Maybe it is the social worker in me, but I love this! However, when I started with The Body Shop we did not have a mission statement. In fact, I am not sure that many companies did, but we had an awareness that the traditional way of business, and especially in the cosmetics industry, was wrong.

Animal testing for cosmetics was wrong. The killing of endangered species was wrong. Ignoring human rights was wrong, and the destruction of rainforests was wrong. Some of these are huge global issues, but we felt we had to do our bit to tackle them.

One of the things we could do was to use our shops and particularly our shop windows as campaign vehicles. We had posters drawing attention to the issues and we trained our staff so that they could answer customers’ questions.

We campaigned in support of Amnesty International and its work for human rights. We campaigned against nuclear testing in the South Pacific. We campaigned against the logging of old growth native forests. We campaigned in support of the Ogoni people of Nigeria in their struggle against the Nigerian government and the Shell Oil Company.

Were we successful? It is difficult to say, but we did find that we were tapping into a need. Our staff responded far more positively than we thought they would. They felt that through their work they were making a difference, however small, to the world. Our customers felt that by shopping with us they, too, were supporting positive change.

This encouraged us to be a little bolder. The campaigns we were conducting were generally about large issues that were important but really were not within the direct experience of our staff, our customers or ourselves. We really wanted to get involved with something closer to home. We wanted to be involved with our local communities, and so we encouraged each of our stores to find a local community group which would benefit from a few hours of voluntary help each week or fortnight and our staff would provide this help during their normal working hours. We did not really mind what groups staff chose to support; the important thing was to do something.

Soon all our stores had a community project. Some worked with local senior citizens homes, some worked with local schools, some worked with the RSPCA, while others supported aids groups. Most staff found that their involvement with this form of active citizenship extremely motivating. Some found it put them outside their comfort zones, which is not always an easy place to be. Most staff, however, reported that involvement in community projects gave more meaning to their work.

While each store was becoming involved with its community, I realised that we did not have a project that the company as a whole could feel ownership of. We contacted the Brotherhood of St Laurence, the well-known Anglican welfare agency in Melbourne, which supports people in poverty, to see whether it had any suitable projects that it had not been able to get off the ground through lack of funding or other resources. The Brotherhood did.

The agency had wanted to run an employment training program for young people with a background of disadvantage and long-term unemployment. The Brotherhood was thinking about employment training in retail as one option. The match between the Brotherhood of St Laurence and The Body Shop was ideal. We provided funding, the use of our shops and staff, and the Brotherhood found the trainees and provided co-ordination of and counselling for them.

What happened next was an unexpected bonus, but was typical of what we found happened to us when we tried to do something because we thought we should rather than because it was good for business. Unbeknown to us, the Federal Government was looking for job creation models and our joint program with the Brotherhood became the model for their JPET program. The resulting publicity proved to be good both for staff morale - and for sales!

As I have said, this was a typical result for us. By doing what seemed to be the right thing by the community, we received benefits for the business that I really doubt we would have achieved had we been mainly motivated by gaining publicity.

Another example occurred a couple of years ago at the time the Native Title Act was being debated. A staff member asked me whether we could sell ‘Sorry’ armbands in a couple of our Melbourne stores just for a few weeks. You may have seen these red, yellow and black armbands that signified opposition to changes to Native Title legislation. As a supporter of Reconciliation, I supported the suggestion, again because it seemed the right thing to do.

Then all hell broke loose! A senator from Western Australia got upset and called for a boycott of The Body Shop by the Young Liberals. The press got hold of this and we even had the BBC telephoning from London for interviews.

Sales were never better!

The office of Senator Minchin, the special minister of state responsible for Native Title, rang to say that he would like to give me a briefing on the legislation and explain why The Body Shop had got it all wrong. I could not attend the meeting, but some of my colleagues did. They listened to what the Senator had to say and afterwards were told that the Minister for Aboriginal Affairs would like to speak with them. He said that he was impressed with the work that the The Body Shop was doing with Aboriginal communities and was wondering whether we would be able to support his department with some projects.

The outcome of this was that we received funding of over a quarter of a million dollars to start a couple of programs including FAB, a program to assist young Aboriginal business entrepreneurs by providing them with mentors from business. All this resulted from the simple decision to sell ‘Sorry’ armbands.

To me, all this seems to say that if you do something that seems to be the right thing to do, even if you do not know the consequences of your actions, you may be pleasantly surprised by the rewards you receive. All too often people seem to assume that you can only prosper by beating the other person - that for someone to win, then someone has to lose. This may be so on the sporting field, but it does not have to be so in the business world. If those of us who are in business can look beyond the needs of the balance sheet to see what are the needs of the community and what we can do to address them, then we can all be winners. We can all work together to develop a truly healthy society.

Barrie Thomas, The Body Shop

Having said this, it is not just a simple matter of a few business people having a change of heart, deciding to become community-minded and then all will be ‘sweetness and light’. Even with the best intentions, there will be difficulties when business people and community groups try to work together. And I speak from experience. Many of these problems can be frustrating, disheartening and can be very destructive to the partnership process unless the different dynamics of the parties can be understood.

Differences in the decision-making processes of business people and community groups are fraught with danger. Business people, especially entrepreneurs who can be very single-minded people, often want to make a decision and then move on. In their minds there may be no alternatives; there is one right answer and that is what should be done. Often their very success comes from being able to make quick decisions and to act upon them. For members of a community group to act in this way could prove to be disastrous. By their very nature they need to consult with their stakeholders and, wherever possible, act with consensus. Alternative approaches will lead to disillusionment and fragmentation.

A parallel and related problem may be seen with differences in organisational structures between business organisations and community groups. For business to operate effectively, it needs a clear organisational hierarchy with everyone knowing their place - who they report to and who reports to them. Business needs bosses and subordinates. Experiments have been tried with flatter structures, but generally it is the traditional pyramid-shaped hierarchy that we see in successful businesses.

For a community group to have a traditional hierarchy like this would not make sense and would be an anathema to their very reason for coming together, which is generally to work together to address concerns over a common problem. The structural difference between business and community groups means that not only are decision-making processes often less clear in community groups, but so are levels of accountability ie. who is responsible for doing what, and who is responsible if things go wrong?

Maybe one of the reasons that most of the business/community partnerships we hear about are between business and the large welfare organisations such as the Salvation Army is that these organisations tend to be structured like businesses, with a clear hierarchy and levels of accountability. They speak the same language and are managed similarly.

This may sound depressing and counter to the message I am attempting to bring - that business does have a responsibility to work with its community. I remain optimistic, however, that we can all work together. The key to me is the word with. Business has a responsibility to work with its community. If business groups allow themselves simply to be a resource base to be used as appropriate by the community, then I think the difficulties I have referred to will be resolvable.

Those of us in business must not assume that we have all the answers, but we do have skills and resources that can be harnessed to find the answers.

Too often I have seen business people think that working with a community group means taking control of the group. I have also observed community groups allowing themselves to be overawed by and become subordinate to business people, particularly if they are a source of funding.

This is potentially disastrous as it can lead to distrust and resentment. Neither characteristic is desirable in any relationship.

For any partnership to work it requires honesty and openness about people’s motives for involvement and a feeling of equality between the partners. This can be achieved, but cannot be assumed and needs to be worked at.

It is hard work, but I remain convinced that if business people and community groups can come together with a sense of equality, then many of our social problems can be addressed successfully and we can develop the healthy communities and healthy businesses that will help us all to prosper.

For further information

Contact	:	The Body Shop Australia Retail Support Centre
Address	:	Cnr Wellington & Jacksons Roads Mulgrave, Victoria 3170
Phone	:	03 9565 0500
Fax	:	03 9560 0033

WWW

:

http://www.thebodyshop.com.au