Audio Podcasts

Transcript

Welcome to Telstra’s innovation podcasts, a series of conversations with innovators in a connected world. In this People Plant and Profit Podcast, this is Hugh Liney talking to Alan Cadogan the strategy director and Chris Derksema the Manager of Sustainability for the City of Sydney.

In a discussion pertinent to all big cities, Hugh Liney talks with Chris Derksema, Manager of Sustainability and Alan Cadogan, Strategy Director with the City of Sydney, about two key policy approaches and visions for future city environmental and sustainability planning and how business must play a crucial role in the plans.

Hugh Liney: First Alan Cadogan can you explain to our listeners, what is sustainable Sydney 2030? What are the challenges that the city of Sydney has considered in formulating this division for the city?

Alan Cadogan: Yes sustainable Sydney 2030, is the city’s long-term vision for the future of the city. So it really started a couple of years ago when we began a year long conversation with the wider Sydney community, about what sort of city do they want Sydney to be in 2030. So we could guide and change and influence the outcomes. So the challenges that we considered in formulating the vision, were I guess things that everyone knows about. Global warming was a huge factor; there was a perception that perhaps there was social inequity creeping in more and more to Sydney, rising costs of living and difficulties in affordability. And I think probably you know in a nutshell the people of Sydney felt like that they had come together during the Olympics and Sydney had really performed well and perhaps we needed a bit of a refocus and a direction for the future.

Hugh Liney: Very timely indeed. Now I believe there are five big moves at the heart of the plan, correct me if I’m wrong, but lets discuss some of them. Firstly a revitalised city centres.

Alan Cadogan: Yeah that’s right, I think what’s really important is to recognise the role that cities play in Australia and certainly Sydney. Sydney is responsible for about a 1/4 of the NSW GDP that’s generated in this little local government area of 26 square kilometres. That’s about a 12th of the Australian economy that comes out of here and I think that people sometimes forget that is about the size of the wheat or wool industry and that’s a message that’s sometimes is lost in a Federal arenas and even amongst businesses. But what we recognise is that you need to therefore invest in the city centre, you need the city centre performing well. Not only in terms of business productivity but also in terms of transport and access, in sustainability, it’s social offering and the liveliness of the culture there.

Hugh Liney: Right and I assume for our interstate listeners that could well apply to their own city centres.

Alan Cadogan: Absolutely.

Hugh Liney: Now an issue dear to all of our hearts, you’ve noted an integrated inner Sydney transport network.

Alan Cadogan: Yeah I think one of the things that came out in the consultations that we had, whether you talk to an aboriginal elder in Woolloomooloo or whether you talk to one of the managing directors of the big banks or the insurance industries. You find that I guess there are two big issues that came up, one was sustainability and green house gas emissions and global warming, the other one was transport and transport congestion and so the plan seeks to capitalise on that and help the State which is the major provider of transport in the city centre. Is to help them integrate and coordinate with all the activities that happen on the surface with business, with the community, so that transport hangs together and sings and performs as well as it can.

Hugh Liney: That’s a nice image. Just to be more specific, the next big move is a liveable green network, now that can sound a bit confusing, so could you just explain what a liveable green network means in terms of the city strategy?

Alan Cadogan: Sure a liveable green network really refers to that next layer of transportation, the community layer of pedestrians, cycling and making the city really accessible for that layer. So that if you don’t need to use a car you don’t have to. In fact say you choose not to. It’s about making those journeys not only safe and easy but also an absolute pleasure. It’s really that layer that I guess local government can most influence because we are actually delivering a lot of it ourselves, rather than the integrated transport layer where we’re relying on others like the state. But really delivering that network of accessibility that allows everyone to access the city cheaply, freely and greenly.

Hugh Liney: Okay similarly, it’s a new phrase to me and perhaps some of listeners, activity hubs can you explain that?

Alan Cadogan: Yeah activity hubs are about organising the way that our city of villages works, so there’s a number of villages sprinkled around the city centre and probably into the areas just outside our local government area. But activity hubs is about coordinating services so that everyone can live within a walkable distance of all those facilities that they need for everyday life. So that might be access to fresh food, access to transport hubs, some council services like libraries and pools and other things located, focused around these hubs an encouragement for state government and federal governments to start focussing on these hubs as well. So things like the child care centres and access to car share might be concentrated in those places all within easy walks of a larger catchment.

Hugh Liney: Okay, finally transport, development and sustainable renewal, how does this apply?

Alan Cadogan: That’s one of the really exciting areas in the plan and it’s about the cities greenhouse footprint and in many ways. It’s about saying that you know it’s really hard to retro-fit all of those old and many heritage suburbs around the city, but there are some very large renewable sites and what we’re saying is they need to punch much higher, than they currently are. They need to punch way above their weight in terms of delivering sustainability, in terms of delivering on green house gases. But also fitting into the network of the city, no longer having big developments that have their own character that don’t mesh in and knit into the fabric of the city, but making sure that they’re actually a pert of the city.

Hugh Liney: Okay now this larger concept of a green global connected city, what does a phrase like that really mean for residents of the city, including let’s just say the poorer and more traditional residents of the city of Sydney.

Alan Cadogan: Green global and connected really came from that year long discussion about what do people want and so I guess for those in our community that are not necessarily the high flyers, it’s really important for them because you know to cycle round the city or to walk around the city is free. If you have access to a vibrant cultural life you’re supporting business, you are increasing productivity and all of that productivity flows through every layer of the city. So you are providing low-income jobs, as well as high-income jobs. It’s also about providing affordable housing for key workers and so coordinating the way that land use is planned around the city centre to enable those who are perhaps less fortunate to be able to still live within close proximity to the city centre where all the services that they need are already provided.

Hugh Liney: Right now. In another part policy and sustainability policy just having a chat to the manager of sustainability for the city Sydney and that’s Chris Derksema, now City Switch now I know this is not just a City of Sydney initiative but a combined initiative of many local government areas. Can you just describe City Switch’s combined vision and then its origins to me?

Chris Derksema: I think first of all the origins of this is really born out of a need to address existing buildings, existing buildings that are 95 or 98% of our cities, we do have new developments and we can really drive those in making them green, however we’ve still got this large portion of existing buildings so how do we address the sustainability of those. Tenants are really important in that equation because they consume about 50% of the energy within those existing buildings and when we have a look at tenants, we see that also there’s very short refurbishment cycles, they refurbish their tenancies quite often and it’s relatively simple maybe compared to looking at base building works that may be able to be done. So really we have a sector here that probably hasn’t had a lot of attention previously, a lot of the attention was on new developments with green rating tools and those kind of things. Whereas this program is more focussed on the existing tenants in those building and what can they do to really make those existing building more sustainable.

Hugh Liney: Okay can you describe some of the other local government areas that might be part of Sydney Switch?

Chris Derksema: Sydney Switch was originally started with three councillors within Sydney and then taken by the City of Sydney via the triple CLM, which is the committee of Capital City Lord Mayors to the other cities. And wasn’t actually a tenancy program in those cities at that time and that has now been one of the drivers, why we have taken this program national. Also the tenancy market a lot of the bigger companies said that they want one consistent program across Australia that helps reporting and how they approach this issue. So that was also a major driver for the program, so it’s now being run in Brisbane, in Melbourne, in Sydney, in Adelaide and soon to have other cities on board as well so we’re looking forward to that as well.

Hugh Liney: All right so down to ticktacks because this is what businesses are becoming concerned with or large government organisations. What are the actions that City Switch is encouraging for businesses, government, tenants and organisations to follow? What are the actions that you are suggesting or requesting that they follow?

Chris Derksema: Look I think the first thing we ask of potential signatories is to make a commitment to being greener first of all, so we say that we’d like tenants to have a four out of five star energy rating. That’s their commitment to achieve that over a certain amount of time and they sign that as their commitment. We then take them through a process of assisting them about how they might go about achieving that commitment and we might do that through cafe series events so they can talk to other tenants and see how they did that. We might provide educational material as well we might also help them with sourcing where can they get their rating from, what consultants might they be able to use those kind of things and taking them through the process. Also helping them understand the business case around these energy efficiency measures. A lot of these energy efficiency measures in tenancies actually make you money over time, so they’re not really, really expensive measures, I mean you can go to that degree as well, but I think there’s a lot of low hanging fruit for tenancies. It’s really quite simple we’re looking at the types of computers you buy, the types of printers, we’re looking at the lighting in the tenancy and maybe a little bit of supplementary air conditioners also, really there's not a lot of things you need to address to actually becoming a greener organisation, a greener tenant.

Hugh Liney: All right now finally, even the Federal Government has problems with sustainability deadlines and timetables. Firstly Chris Derksema, what type of timetable deadline are you following?

Chris Derksema: Really the vision for City of Sydney is to transform the tenancy industry for the tenants to be greener across Australia. One of the targets below that is that we would like to see 20 % of the tenancy market in Australia joining up to this program and making these commitments. And if they make these commitments that means we will have 20 % of the industry at least committing to 4 stars and hopefully 5 stars out of 5 stars, so very high commitment. And we’re hoping that, that commitment or the achievement of that commitment will really help transform the industry. So what we’re looking for, we picked 20% because we believe that, that is sufficient or that’s a good target to show by leadership and really drive the leaders in the industry and hopefully the rest of the industry will follow. So it’s enough to get transformation in the industry.

Hugh Liney: Seems realistic. Now Alan Cadogan you’ve got 2030, a sustainable Sydney 2030, tell me about that type of timetable and what you realistically expect to achieve?

Alan Cadogan: You know I think businesses understand long term planning and they like to have a Government giving them some direction and some leadership about the way forward and I think sometimes it has been absent and so I think it a really good thing it’s around. This is year one of 2030 so we have a long way to go, but we have started already. So we’re being opportunistic. Obviously the financial downturn is changing priorities and changing opportunities, but we’re moving ahead on all the fronts that we can, we are re-tooling our organisations to address the major themes of Sydney 2030, we are commencing a number of really interesting programs, like investigating LED street lighting to drive down our green house gas emissions, but also to save energy and maintenance. We’re this week opening the first of the separated cycle ways in Sydney, it’s only a short run, but there’s another 20 kilometres planned and we’re spending 70 million dollars over the next four years on that program. We’ve got Alan Jones from the former head of the London Climate Change Agency coming out to Sydney again this month, to help talk to us about how we do and implement a green infrastructure master plan throughout the city, so that we can drive down green house gas emissions and improve energy security. We are working on every front that we can and we really need business to understand the plan, to come on board with partnership, and to work together.

Hugh Liney: Okay Alan Cadogan and Chris Derksema thank you very much.

Alan Cadogan: Thank you.

Chris Derksema: Thank you.

Transcript

Josh: Alex Stefan, thank you for joining us.

Alex Stefan: Thank you, Josh.

Josh: So tell us a little bit about how technology has transformed the way government serves its constituents.

Alex Stefan: Josh, it's been quite extensive. As you'd appreciate, in Australia there are three tiers of government: Federal Government, State and local government. Each of them deliver quite unique and specific services to the Australian citizens.

There has been a tremendous migration towards more online services for the community. I'm not sure if you noticed in the last Australian census that you actually had the option of actually doing it online for the first time, through the Internet. So that's been quite a profound change in relation to the traditional ways of collecting citizens' information.

Other changes, obviously, have been in the way we interact with government, especially through contact centres, and the development of technologies in those particular areas. Then, when you look at, for example, mobility and how that's had profound implications for the emergency services such as the police, ambulance, the fires; or even the health professionals across Australia. So technology is having a profound impact and changing the way that the various tiers of government are interacting with the community.

Josh: So, Alex, tell us a little bit about some of the challenges that government sector customers are facing today.

Alex Stefan: Well, Josh, I suppose the greatest challenge is obviously the continuing demands for new generational services by the community. So each day government, across its various tiers, has to continue to provide those services to the community.

Obviously, with the changes in the socioeconomics and demographics in Australia, there is a higher expectation, for example, of more services being provided online; be it through smart phone technologies or through the Internet.

However, government has to deal with these particular challenges in a time of fiscal constraint. So while trying to deal with the requirements of meetings these new service requirements of its citizens, it has to do so in a far more fiscally challenged environment.

Josh: Okay. Alex tell us about the future Telstra sees for these government customers.

Alex Stefan: Well I think government is obviously trying to be far more innovative in the way it delivers its services to the Government. So in State Government, for example, if you look at some of the major services they provide around health, education and the emergency services, you're seeing a lot more of the application, the video conferencing - especially to remote and regional areas - for the provision of health services.

Similarly, in the education domain, we're having children in schools, for example, being provided with access to mobile broadband as part of their tablet computers. Obviously, the emergency services are utilising greater mobility and unified communications to improve interoperability across those particular entities.

Of course, in the Federal Government sphere, we have - obviously in the social security domains and human services - some fantastic innovations around contact centres to help connect to Australia's 22 million people to the Government.

Josh: Can you tell us a story of a government agency that has really got it right and found the [mix of meeting its constituent's] needs and using technology to connect in new ways?

Alex Stefan: So I think Australia, obviously, is a very large geographical country and extremely dispersed. We always talk about the urban areas and, obviously, the remote, rural and regional areas. I think communications and network technologies and ICT are actually able to bring a more equitable service delivery to all members of the Australian community; irrespective if they live in the Canberra CBD or whether they live in Thursday Island up in the Torres Strait.

Josh: Now, Alex , let's change tack a little bit and talk about cloud computing. What is cloud computing in the context of government? Are there different considerations for national, state or local agencies?

Alex Stefan: I believe cloud will have a significant impact on government, irrespective of the tier; be it federal, state or local government. As you'd appreciate, there are some unique challenges within government in respect of utilisation of some of these services; as compared, for example, to the private sector.

I suppose the first concern is around sovereignty and ensuring the protection of the information which is retained by government. Obviously, governments of all three tiers retain a lot of information around its citizens. It's very important to make sure that information is held privately and securely.

However, I do envisage that the cloud computing will become more important to government. I believe local government will look at the cost efficiencies it can deliver to its constituencies. Progressively, State and Federal Government will also move to adopting more public and private cloud solutions to meet the demands.

Josh: To wrap up, Alex, why would government choose Telstra as its preferred provider today?

Alex Stefan: Well, Telstra's an Australian company that's had a long relationship with all three tiers of government. We have an extensive experience with these particular organisations and in their particular and unique challenges. We also have a wonderful expertise base that can help meet the demands of the Australian Government.

Josh: Alex Stefan, thank you for joining us.

Alex Stefan: It's been a pleasure, Josh. Thank you.

Transcript

Josh: Alex Stefan, thank you for joining us. We're talking about public safety and security today.

Alex Stefan: Thank you, Josh; nice to be here.

Josh: So, Alex, tell us a little about the challenges that safety and emergency services are dealing with in Australia.

Alex Stefan: Well, Josh, I think you've seen some of the significant impacts that have occurred to Australia over the past few years. Certainly, there's been a lot of dialogue about the global climate change that's currently occurring and the impacts it's having on natural hazards in Australia. And I think you only need to look to the last summer, where we saw such extensive flooding in Queensland and in Victoria.

The second challenge that the emergency services are grappling with is the counter terrorism arena. We've just marked the 10th anniversary of 9/11 in New York. And it highlights the significance of that particular area of activity for the emergency services.

The third area that they're having challenges with is the changing socio demographics of Australia. We have an ageing population in Australia that may demand more services, for example, of the ambulance services. That particular shift in the demographics will also have a particular impact on the demands for those particular organisations that provide those emergency services.

On a final note, I suppose, the other major area that the emergency services continue to focus on is on the safety of their professionals. These officers put their lives at risk on a daily basis. Obviously, they're looking to technologies and other innovations to ensure the safety of those professionals in delivering services to the community.

Josh: Alex, tell us a little bit about the work that Telstra's done to support emergency services' security in Australia.

Alex Stefan: Well, Josh, communications are the life blood of an emergency services organisation. So Telstra plays a pivotal role in relation to the provision of those communication services which are absolutely fundamental to ensure the interoperability of the police, the ambulance, the fire services, and any other agencies that are responsible for responding or recovering for a particular situation.

Telstra has a lot of experience in this particular area. We are well founded in relation to providing that support through some of the world class facilities such as the global operations centre and, obviously, the allocation of emergency services liaison officers, specifically to work with our customers in the emergency services during these particular events to ensure that their priorities are met at all times.

As you'd appreciate, in a disaster scenario you don’t want to be picking up a telephone to someone you've never met or spoken to, seeking assistance in recovering the communications to an area or providing extra capability because a particular response is required in that area. So Telstra takes a very proactive position in relation to responding to the emergency services and ensuring those relationships are maintained throughout the year.

Josh: Can you tell us a little bit about what Telstra can do for the sector?

Alex Stefan: Well, I think, firstly, we provide unprecedented service and support, 24/7, 365 days a year, across the whole geographical area of Australia. As you'd appreciate, Australia is a very large country in respect of responding from emergencies, through to natural hazards and through disaster events.

We also provide specialist services, particularly for the emergency services, to ensure that their communications are maintained at all times; and also the ability to provide in-field technologies to support them in responding to the emergency services. So I think those are just some examples that we provide.

Josh: Finally, Alex, how do you see the requirements of this sector evolving?

Alex Stefan: One of the great innovations, certainly, that I've seen in the last few years, that Telstra and the emergency services sector together, has been about community information alerting. So in the post Black Saturday event Telstra and the emergency services worked towards establishing a new service called Emergency Alert.

During the Queensland floods, for example, over a number of weeks over seven million messages were sent in the context of SMSs and telephone calls to the public forewarning them of particular events that were occurring in their geography. So we're continually working with the emergency services communities to look at how we can develop new solutions that will enable the safety of the public.

I think one of the great exciting elements for the sector is obviously mobility. These organisations are highly mobile. So whenever someone calls triple 0 - be it for an ambulance, a fire service or a police service - they're normally delivered through some sort of transportation.

So through Telstra's wireless mobile networks we'll be able to deliver more and more services to them, which previously were only constrained to their police stations, ambulance and fire stations. The ability to communicate - not only amongst the emergency services, but with the utilities and other sectors - will become more and more important.

I think unified communications solutions around video conferencing, around video IT telephony etc, will play a greater and greater role in the emergency services in helping inform and improve that interoperability.

Josh: That's great, Alex. Thank you very much for joining us. We really appreciate your time.

Alex Stefan: My pleasure, Josh.

Transcript

Hugh: Welcome to Telstra’s innovation podcasts a series of conversations with innovators in business and government - in today’s podcast this is Hugh Liney talking with Amanda Keogh environment and sustainability manager of Fuji Xerox. Amanda takes us through Fuji Xerox’s exemplary corporate sustainability performance but more importantly how the company encourages its customers and the community to improve their performance.

Amanda, perhaps Fuji’s best-known environmental process is the eco manufacturing plant is Zetland in Sydney, its been a growing concern for nearly a decade tell us about its initial role and how is has changed and developed over the decade.

Amanda: Well the eco-manufacturing centre was developed in 2000 but our work on design for the environment and product philosophy started well before then. The parent was looking at applying close-looped thinking about design philosophy you know from the early 1990s and it was in 1993 that three clever people in our Mascot office figured out that a circuitry board worth about $10,000 which was about to be replaced should not be treated as waste. That lead to our innovation around parts manufacturing and eventually culminated in the establishment of the manufacturing centre in 2000 and of course won a United Nations award.

Hugh: And it is still fulfilling that same role now.

Amanda: Although the focus of the eco-manufacturing centre as evolved over the years so it was known for cartridge re –manufacture… since then we have found that a lot of that labour intensive work happens at our Thailand integrated recycling centre and what is happening now in Zetland is much more high-end and skills intensive manufacturing around more complex parts of our equipment.

Hugh: A couple of other initiatives for Fuji Xerox, the Carbon Calculator now this is something that I haven’t been able to find out much about, but tell us how the carbon calculator works and how it helps business and government customers and perhaps how we should alert people to find out more about it as well.

Amanda: Well basically the carbon calculator allows our customers to pin point opportunities for energy efficiency in our print platform so usually what we find when out services organisation goes into a large company or a large government agency they find that there are too many print devices and a lot of older and inefficient print devices so there is usually great opportunity for consolidation and that has core benefits as well as environmental benefits. We have found for example with the Roads and Traffic authority we are able to reduce the energy consumption of their insulation by over 20% by optimising the print environment.

Hugh: Is this slightly different? I have some notes from online here about the international scoreboard, is that a different concept?

Amanda: That’s different, That’s higher level I guess which applies across energy paper, and electronic waste metrics to identify where a customer might be in terms of a low a medium or a high score across each of those metrics.

Hugh: An award that your company got recently was for multi-functional devices something, which is seen in most businesses, a medium size like my own or a large size like other Telstra customers. Now the eco-label environmental performance award for multi-functional devices, what was that for?

Amanda: Are you talking about the good environment certification of Australia?

Hugh: Yes that is the one.

Amanda: When we were first in our industry to get that certification we find that a lot of that was driven by procurement and driven by government organizations who were getting very specific about the kind of criteria they wanted our equipment to meet. I think it is fantastic that government procurement plays a very important role in driving the industry forward to improve the environment for the performance.

Hugh: As an example not just to customers but also to the corporate world besides assisting with clients and their business improving their environmental efforts …what targets does your Fuji Xerox want in terms of reducing energy emissions?

Amanda: We have been certified for over a decade now, last year we got a 19% reduction in our carbon emissions and a 34% reduction in our water use we brought down out paper use by just 1% but unfortunately we blew out our waste target, so our waste went from 34% to 45% which we are pretty disappointed about but we know what is the problem --- waste stream and all the equipment that is coming through on non-recyclable pallets, so working to identify solutions for that.

Hugh: There must be benefits we all want to be good eco-citizens and good corporate performers, but what are the benefits of being a good corporate citizen as far as sustainability, environmental philosophy and performance?

Amanda: I found this question the hardest to answer based on what we have already discussed and I think the reason for that is that for Fuji Xerox its really at the heart of our business, its core to our identity and if I was to identify some specific benefits that we get out of that I think definitely our employee engagement, retention of employees and recruitment of our employees is enabled when you are committed to sustainability, obviously it’s a growing customer requirement and its tickets to the game these days. If you want to actually sell in this ICT space you have to be able to demonstrate your credentials and then finally I guess business efficiency that this environmental stuff makes sense.

Hugh: How difficult is it for Australian business and government organisations to really improve their efforts?

Amanda: I think businesses will always respond to market drivers and to government regulation. I think consumers will make the right choices in their purchase decisions. I think the problems that seem to be emerging now are around enabling that informed decision. There is a lot of confusion surrounding environmental claims made and environmental labelling schemes; there is a role for government in perhaps monitoring and correcting environmental labelling schemes. Also monitoring marketing claims so that consumers feel that their purchasing decisions will have an impact in the right direction and once you have that happening business will simply follow.

Hugh: Look just for our own interest and other companies that listen to this and government organizations that listen to this, Amanda how did you get into the business of becoming an environment sustainability manager. How does one get a job in this area?

Amanda: When I had been working in ICT in Ireland for about 6 years then I came over to Australia and not exactly sure what I was going to do next but I knew I wanted a change. I got to know some people working in the sustainability area and started a Masters is sustainable development at Macquarie University.

Hugh: Amanda Keogh of Fuji Xerox thank you very much.

Transcript

Hugh Liney: In this special podcast we hear from Andrew Milroy the head of ICT for Frost and Sullivan Australia, New Zealand. Research conducted by Frost and Sullivan early in April and May this year revealed that organisations using a specialist third party provider to manage their Wan environment are experiencing significant cost advantages.

Hugh Liney: Tell us firstly about the cost advantages of using a third party provider?

Andrew Milroy: Okay. Well in the work that we did, we sought to basically figure out and quantify some of the cost advantages associated with working with a third party, and also I've got to state, I've got to reiterate, we weren't sure if using a third party would necessarily offer any cost advantages when we started but the work proved that it did.

Hugh Liney: Good.

Andrew Milroy: So we split the cost associated with managing a Wan into direct cost, so this is things like the cost of IT staff and indirect costs, so this would be things like non IT staff who are involved in, I guess self support and peer support activities such as those. The work that we did showed that the overall total cost of Wan ownership for a typical organisation falls by around 38 % when an organisation outsources its Wan to a third party. And this is an average, I mean there is variation depending on industry, organisational size, criticality of the Wan and so forth but it's indicative. You could get saving as much as 38 % if you outsource your Wan to third party. When we look at the direct costs associated with Wan management, having a third party doing it for you can offer you a saving of around 27 % in a typical organisation. When we break down these direct cost elements more specifically, we find that for vendor contract management and procurement which is a component of the direct cost, for an average organisation the savings are around 54 %, again this is an average figure, and the data showed that a 91 % saving is typical for the cost associated with non IT staff. now that’s an indirect cost. What we find is, when third parties are used they typically embed tried and tested support tools, they can reduce the amount of time spent by non-IT staff on technical tasks. They can also typically guarantee higher service levels and typically guarantee lower levels of downtime, which again are linked to the indirect costs associated with managing a Wan.

Hugh Liney: Yeah well they are key points, and also in your research into these organisations, what challenges are they experiencing when managing their Wans themselves?

Andrew Milroy: Okay well an organisation itself will look to have its own very high service levels associated with the Wan, so certain application performance and the Wan operates in a manner that suits specific business needs. Wans are becoming more and more critical for every day business activities. So delivering high service levels using internal resources alone is becoming a more challenging task. Attracting and retaining the right skills is becoming both costly and difficult, just to get access to those skills. And also getting the latest technology is also a significant challenge. So these are like two examples of things that aren’t too easy. It can also of course be very expensive. So those are some of the major challenges of the organisations we spoke to, other challenges they talked about was freeing up resources and not having resources tied into these kinds of base operational Wan management tasks, have been able to focus on core competencies and as I mentioned also they talked a lot about access to new technologies and skills.

Hugh Liney: We've heard about some challenges, now some good news. What are the benefits that some organisations and especially the ones you have researched are experiencing by moving to third party Wan management?

Andrew Milroy: That’s one of the main areas that we focussed on, that we researched on, to try to find some of these benefits and I think the key ones were getting access to specialist Wan related skills, this was a big one, getting access to the most up to date technology was another advantage as well as the obvious issue around costs. Organisations at the moment are often looking to shift their capital expenditure, to have lower capital expenditure and more operational expenditure so basically change their cost structure so where possible use operational expenditure instead of capital expenditure. So lots of cost related issues there were perceive to be benefits. Third parties are also perceived by many of the organisations we spoke to, to offer superior support and maintenance to what those organisations can offer using in-house resources, as well as savings on software licensing fees. And there are other clear benefits because basically the technical expertise that the third party offers is spread over a number of organisations. So basically there are cost benefits associated with that, I mean some might say well, 'hey perhaps they are not as dedicated', but usually it's tied into a service level to ensure that the organisation gets higher service levels than they are able to provide in-house.

Hugh Liney: Are there risks in engaging a third party for Wan management?

Andrew Milroy: Okay, I mean I think that there are general outsourcing issues that emerge all the time so a lot of companies will talk about control issues, there may be cultural issues, there may be privacy concerns associated with outsourcing. There are also some organisations, it has to be said, who will say, 'well we believe that we can manage our infrastructures better than anybody else, we understand our business better and we don’t really see any benefits from working with a third party', however what we're finding is that the business case for working with a third party is becoming even more compelling over time for more and more organisations, as the outsourcing model matures, the risks associated with outsourcing have been addressed, more and companies are finding it harder and harder to manage wide area network for example using internal resources. So you know, the business case for managing Wans basically, using in-house resources is becoming less and less compelling and outsourcing it is becoming more and more compelling. But from a performance perspective third parties are usually able to offer service levels that can minimise downtime, optimise application performance and offer more proactive support services than would be the case doing this in-house. So doing this I mean that is offering the highest service level, using your in-house resources today is becoming harder and harder and harder so hence the case for working with a third party. The business case is becoming a difficult one to ignore for most companies in Australia today.

Hugh Liney: Okay Andrew Milroy thanks very much.

Transcript

Hugh Liney: Speaking to Brad Grey who's the campaigns manager at Planet Ark.

Hugh Liney: Now Brad, you might want to refresh our listeners about Planet Ark's overall aims and methodologies, tell us a bit about the organisation.

Brad Grey: Our overall aims and objectives are really to help people find ways to reduce their impact on the environment. So that’s individuals abut also businesses and I suppose since we were set up in the early nineties we worked very much with businesses, so we licence businesses who produce products to use our name and we asses those products before we obviously let them use our logo on that. But we also work with businesses as well, so you know we've got programs and events and activities that we do with businesses that help them reduce their impact, as well as, as I said for homeowners as well individuals.

Hugh Liney: Now as a journalist the first thing I come across of course was World Environment News, which has been going for quite some time. That seems to be a project with enormous scope with Reuters in particular. Tell us how that works?

Brad Grey: Well Environment News is a fantastic program we literally get all of the environment news stories that are developed by Reuters or coming through Reuters every day. We process those and then we send them out to people who subscribe, so there are more than 22,000 subscribers to that. It's very often media, businesses and concerned individuals, environment groups, so a whole lot of people and literally they just get a message and stories about what's happening all over the world in terms of environment, and it’s a great program, it's fantastic if you want to keep up to date.

Hugh Liney: It sure is, it's full of information too, and so we've got to recommend it here. The one thing I do know that Planet Ark's always full of, and that's great campaigns during the year. Now some of these particularly might be of interest to Australian businesses. Can you tell us about a few of them now? Firstly, Friday Fling Day, interesting word so tell us about that?

Brad Grey: The Friday File Fling was kicked off this year as one element of National Recycling Week and the idea behind it is the fact that in Australia our recycling rate for office paper is only about eleven percent that means 89 percent of it is not being recycled. Some of it goes to landfill, but a very large portion of it is actually stored in files that will never be read again. So what we're encouraging businesses to do is to get files out of filing cabinets and then either for preference reuse paper if it's single sided so make it into note pads that kind of stuff or to actually just recycle it, and I suppose we did it for the first time as a trial this year it was incredibly successful. 89 % of businesses who did it said they would do it again it was an easy process to organise. That it was a really good way for them to promote their existing recycling programs to their staff and most of them or a very large number had events, social events attached to it as well. So you do your filing in the morning, morning tea, drinks after work that kind of stuff and we say from the fifty businesses we got feedback from, we saved more than a 120, 000 litres of water just by recycling the paper.

Hugh Liney: They're fantastic figures. One that always hits the newspapers of course is the plastic bag ban — give us an update on that?

Brad Grey: The plastic bag ban. The only state that has banned plastic bags so far is South Australia. It's been in existence for about 6 months now, they have just done an assessment and what they have found is, that the world hasn't stopped spinning.

Hugh Liney: laughs.

Brad Grey: People are adjusting to it really well the vast majority of people remember to take their bags with them, and those that don’t can buy them, but they recognise now that if they don’t take their bags they have to pay a price. The feedback has been overwhelmingly positive in South Australia.

Hugh Liney: Tell us about the other states?

Brad Grey: The other states. You know we haven’t had quite so much movement from the other states yet, which is unfortunately the Northern Territory is looking like joining up with South Australia hopefully, hopefully that will happen. But in the rest of the states, you know we're not seeing that sort of movement on a governmental level, but what we're seeing is individual stores who are actually starting to do stuff about it.

Hugh Liney: That’s what I have noticed there seems to be been a bit of corporate or company discovery of such a scheme and more and more I'm seeing it here in NSW as well.

Brad Grey: Yep. So stores like Target they’ve phased out free plastic bags in every store they did it basically because they had to do it in South Australia anyway so more credit to them. Stores like Aldi have never given free plastic bags and people still go there. Stores like Woolworth's, if you get less than 3 items the staff are not supposed to offer you a plastic bag and largely that actually happens, although sometimes I think they forget. But what we are seeing is even though the government's not leading, people are actually, businesses in particular are actually starting to go there.

Hugh Liney: Cartridges for Planet Ark, it’s a growing problem these cartridges at any scale of business. Tell us how for Cartridges for Planet Ark actually operates?

Brad Grey: Cartridges for Planet Ark works by two ways, so we set up collection points either in post offices, Harvey Norman, Dick Smith all those kind of places which are for individuals or very small businesses, so they can take their cartridges in, just drop them in the box there and they get sent back for free. There's also a parallel program which is for business, so if you use more than three cartridges per month you can get a free collection box in your business, and when the box is full you just send your cartridges back depending on where you are, you send them back in various ways either through the post or a collection system. But it’s a great program because the manufacturers, the people who make the cartridges are actually paying for the entire process, paying for the promotion for the pick up, collection and recycling and so it’s a really good example of an extended producer responsibility program so the participating manufacturers Brother Canon Lexmark Konica and Minolta and should be congratulated for actually being part of that process.

Hugh Liney: That’s great. Talking about cooperation, I noticed that there is another one where you cooperate with Sensis and the government and obviously one need partners at all of these campaigns of any great scale and this one's called Recycling Me You. How does that operate?

Brad Grey: Recycling Me You operates, it's a website that lists the recycling options and activities of every single council in the country so all six hundred of them, we've got all of their information about what they do in their area, but running parallel to that, we also have information about all of the drop off locations for things that council don’t collect. So batteries and car tyres and light globes and gas bottles and x-ray film and corks, all of that stuff you can find a local drop off location if it exists it's on the website and it's near you, and Sensis was our foundation partner for that, so they've been with us since the beginning and the government came in and helped us set up the call centre so we've got the website and we've also got a phone line which is 1300 733 712 which you can get all that same information on as well.

Hugh Liney: Great. Another campaign for business and government to participate in, perhaps as we're doing this interview in the festive season, I noticed that there's one that was once called Festive Recycling is that correct?

Brad Grey: The Festive Recycling campaign was one we ran last year, it was really popular. There's a lot of extra consumption at Christmas. It goes through the roof and what that means is there's also a lot of extra waste, so what we are trying to do is get businesses, when they are having their Christmas party, to actually think about what they are going to do with the waste, before they actually have the party, so setting up collection points, using reusable plates and cups, so you actually don’t generate the waste in the first place. Catering to what you need and not, you know, way more than you're ever going to consume. So we encourage that, we develop down-loadable signs for businesses so for that in having in their Christmas party they can put signs up so they can tell people how to separate their waste for recycling. Because what also happens at Christmas is there's lots of extra contamination, so people go to a work Christmas party, they might get a little bit tipsy and they don’t separate their waste the same as they did earlier on. It might get a bit confusing so we've developed signs to help them do that. And then similarly at home we've got a Festive Green Guide, which has got everything you need to know to have a green Christmas, so everything to what foods you might want to pick, to travel, to your holidays, to recycling, to finding information about recycling in your holiday house everything you might need.

Hugh Liney: That’s great, on that festive and holiday note, we'll say thank you very much to you Planet Ark's Brad Grey.

Brad Gray: Thank you.

Transcript

Brian Bissaker is the Chief Executive Officer of Colonial First State investments the funds management and superannuation arm of Commonwealth Bank. Brian first joined Colonial First State in 2002 and became Chief Executive in 2006. Prior to joining CFS Brian spent 8 years at BT Funds Management where he was executive vice president and head of product. Brian started his career as a taxation and superannuation consultant at KPMG. He has extensive experience in the financial services industry; he is a director of both the Association of Superannuation Funds of Australia and the Investment and Financial Services Association and chairs that associations Economics Tax and Savings Board committee.

Recently CFS entered a partnership with Generation Investment Management. A funds management business co-founded by former vice president of the United States Al Gore. Generation is pioneering a new way of integrating environmental, social and ethical issues into the management of equity portfolios and its partnership with CFS is the first and so far only one of its type that Generation has setup. Brian spoke to us about how the partnership came about and also about some of the challenges that face companies like CFS operating in a competitive and sophisticated market.

Simon Hoyle: Welcome Brian, and thanks for joining us.

Brian Bissaker: It’s my pleasure Simon.

Simon Hoyle: Now Generation Investment Management, that’s a high profile funds management firm setup by Al Gore and David Blood, who is formerly head of was it Goldman Sachs?

Brian Bissaker: That’s right.

Simon Hoyle: Yep, now they could have had their choice of partners I would have thought for tackling the retail market. So why do you think they chose Colonial First State?

Brian Bissaker: In the Australian retail market we’ve got the largest market share so if you’re a foreign fund manager looking to get penetration into that market then it’s probably logical to go with the biggest, but I think it was a bit more than that, they also did their due diligence on us and wanted to get an alliance with an organization that had similar values and similar if you like credentials and reputation and they were quite happy with our reputation, our brand and what we represented, so they were happy to go with us.

Simon Hoyle: So they looked into your operations quite closely?

Brian Bissaker: They did yes. They’re a quite well regarded firm off-shore, so they wanted to make sure before they partnered, because this alliance is more than just a casual relationship; this is a deep alliance which we hope will run for many years, they; before entering such a serious partnership, wanted to make sure they were getting into bed with people they could well and truly do business with.

Simon Hoyle: But of all the markets in the world they could have chosen to do an alliance with, they’ve chosen Australia, might not be an obvious market to choose, but what was their thinking there?

Brian Bissaker: Yeah, Australia is fairly sophisticated when it comes to the use of fund management products and a lot of foreign managers look to Australia, because, we have actually the fourth largest pension market in the world. So there is a lot of uptake of foreign products here in Australia, and so we are getting a lot of people from offshore coming here, partnering with the likes of us and other firms, it does make sense for someone offshore to come to Australia.

Simon Hoyle: So Generation wouldn’t have been the only funds management firm with this style of product touting for a partner. So why did CFS decide to go with Generation putting the shoe on the other foot. It wasn’t just Al Gore’s profile was it?

Brian Bissaker: Yeah, no, it wasn’t Al Gore and I’ll come to Al's position in a minute. When there’s been some growing demand for sustainability as an investment theme for some time and a number of our competitors have just gone down this path but we were relatively late to the market because we wanted to make sure if we went into this theme we were partnering with the very best firm we could find globally. And when we first came across Generation our investment specialists were doing research on good performing, well structured managers offshore and that’s where Generation came up with David Blood; who is the managing partner, he is the guy as we said, former MD, well former Chief Investment Officer of Goldman Sachs Asset Management Globally. Very well regarded and influential guy and he put together a very strong team and the investment performance from their UK fund, which is where they’re based, was very, very good. So that, investment credentials which was what really attracted us in the first instance, however, having said that with a guy like Al Gore as their chairman, Al doesn’t actually get involved in keeping the stocks but he certainly has a macro input into what’s going on with global economy, global politics banking science etc etc, having a guy there with that sort of profile well doesn’t hurt and indeed helps when looking to market into the Australian retail market.

Simon Hoyle: So where does the whole idea of sustainable investing fit in with the typical Australian super funds view of the world?

Brian Bissaker: It’s been a growing theme and more so in relation to institutionally large super funds as part of the way they construct their portfolios. It’s becoming more and more part of the question they ask their fund managers, do you look at environmental social and governance issues, because there is a growing body of opinion that these sorts of issues do matter when generating investment performance. So the institutional market is very much embracing it, the retail market has had some options available but I suppose where you think now, particularly with what’s going on with sustainability as a theme in across society generally that the time has come for the retail market and hence our involvement in it is evidence of that.

Simon Hoyle: So investing sustainably, is not just a matter of taking a standard equity portfolio and then applying some sort of filter to knock out the stocks that you don’t like, is there a bit more to it than that?

Brian Bissaker: Yeah it’s a bit different. In the past there’s been themes called ethical investing or socially responsible investing etc but this sustainability is more than that it’s not trying to just knock things out because someone’s values are being offended by them.

Simon Hoyle: Values in the sense of their ethics and morals?

Brian Bissaker: Correct, that’s right; it’s trying not to make these sort of value judgments. What it’s trying to do is say; look if an organization has got very good corporate governance and is able to deal with regulators, look after its license to operate in a positive way then it can and it does get access to different markets because it has this good reputation etc etc. If a company is good at looking after the environmental footprint and again it gets ticks in the box with government agencies with local, other stakeholders etc. So when you’re looking at these environmental social governance factors it can, and you look at those things in a sustainable long term sense, there is a view and it’s certainly Generation’s view that this does drive performance. If you can do these things better; if you can look after your people for example your human capital is another element of sustainable investing, so there are these themes which may not be readily, well, in the past have been readily apparent, people just look at numbers. There are underlying themes which people like Generation subscribe to, the fact that if you look after these other underlying themes your numbers will be very, very good.

Simon Hoyle: So it sounds like rather than sustainable investing being a little pot that sits out on its own on the side somewhere and a superfund might throw a few dollars its way almost as an afterthought, the idea of sustainability is migrating into the mainstream of equity funds management.

Brian Bissaker: That’s correct, exactly right Simon, it is becoming main stream and so people are integrating it as part of their overall analysis of the stock that they’re looking at; so in the past there has been some groups that have the financial analysts looking at the finances and other management criteria and then having if you like an ethical screen overlaid on that, but what’s happening now is the analysts who are looking at the finances are looking at the quality of management and part of that management quality are these sustainability factors.

Simon Hoyle: Okay and how significant has the take-up of this option been? It’s early days yet but it’s an interesting way of viewing the world and it’s got a profile with Al Gore there, what’s the response been?

Brian Bissaker: It has, look, it’s probably a bit too early to tell Simon, we’ve only had it open for 6 weeks and typically when you open a new retail fund it take some time, you cant really tell until it’s about 6 or 12 months out because for it to get big take-up it needs to be on the approved list, recommended list of retail research houses etc etc and that takes some time and we’re just going through that process now. Having said that we have some healthy flows already but we don’t really know until 6 or12 months from now.

Simon Hoyle: So this something you’ve gone into not expecting a sort of short-term payoff, this is something you’ve gone into with a longer-term view.

Brian Bissaker: Correct yes, it’s an alliance, it’s going to be there for a number of years, we certainly had a relatively high profile launch of the product and that was good for an immediate understanding and awareness but the actual payoff is over a number of years.

Simon Hoyle: That presumably requires a bit of patience and a bit of foresight in the view of your parent company as well, so can you explain to me where Colonial First State fits into the Commonwealth Bank’s overall strategy and structure in financial services?

Brian Bissaker: Yeah sure, the Commonwealth Bank has three main divisions and one of those divisions is wealth management and CFS fits within the wealth management division, the other major company in wealth management is CommInsure, which is Australia’s largest life insurance company. But looking at CFS the strategy for a bank like CBA of owning a wealth management business like ours is that we’re seeing the assets being allocated to superannuation investments in Australia growing. The total pool is upwards of $1.3 trillion and there’s estimates to say that will grow to something like 3.8 trillion over the next 10 years, which are very big numbers.

Simon Hoyle: They’re almost meaningless aren’t they? They’re so big.

Brian Bissaker: They’re very big, very big, so you see that the growth is very much there and it’s interesting to note that the reserve bank at the moment, the total assets just in the banking sector are 1.8 trillion, so you may speculate over the next ten years there may be a crossover between the assets devoted to superannuation and investment generally, compared to the banking sector. So if you’re a large bank like CBA, you want to make sure that you’re part of that and hence they bought us, Colonial First State, seven years ago and it has been working with us ever since. So that’s where we fit in to the overall strategy, so the bank has access to this growing superannuation investment pie.

Simon Hoyle: Now as you’ve mentioned super is a very fast growing area. Growth of super obviously is largely underwritten by the superannuation guarantee, which requires employers to contribute on behalf of their eligible employees 9% of their employee’s salary to superannuation. Now does that sort of guaranteed growth promote competition or is there a tendency in the industry for it to be a little less competitive than it might be because it knows this growth is going to happen?

Brian Bissaker: No it’s totally the former Simon, the, if you look at the structure of our industry, it’s the most competitive of the financial services industry and there are four or five main subcategories if you like as well as the retail funds which I operate in, there’s also industry funds, there’s company or corporate super funds, there’s public sector funds offered to the public service and there’s also self managed superannuation funds.

Simon Hoyle: Mmmhmmm.

Brian Bissaker: So there’s a large amount of choice and indeed for example the concept of a self managed super fund doesn’t exist in a lot of foreign jurisdictions, it’s very unique to Australia.

Simon Hoyle: That’s a local beast is it, the self managed fund?

Brian Bissaker: Yeah it doesn’t exist as such in the States or in the UK, you can’t actually do the sort of things you can do yourself offshore so in the Australian market, we are I think we’re as consumers spoilt for choice and my view is because there has been government policies underpinned with the 9% it’s provided such a pool of savings as I’ve said we’re the fourth largest pool in the world of pension money that’s privately run, that you get innovation, you get competition and that has been good.

Simon Hoyle: So how important is scale then if competition is in fact quite intense. How important is it to be a big player or is there still room do you think for specialists to carve out a decent living?

Brian Bissaker: Yeah look it’s important if you’re in the big end of the fund market, so the big industry funds, the big retail funds, the big corporate funds, it’s important to be there with scale because it costs a lot of money to run those funds and there’s a lot of compliance and other issues you have to tackle so you can get economies of scale if you are big. Where the boutique end of the market seems to work is more if you’re an investment manager and you want to offer your services to a superannuation fund, there’s a lot boutique investment managers who have setup and there’s low barriers to enter if you do that. The other end of the market; self managing your super, you know, small accounting firms offer that, so there are some areas of the market where you don’t need to have necessarily large scale but other areas where it does, it is imperative.

Simon Hoyle: Administration and lowering unit cost through scale is that the idea there?

Brian Bissaker: That’s right, if you’re on the big end of the market as we are, the bigger you are the unit price drops.

Simon Hoyle: Yep, so how many people have does CFS employ and what areas of activity are they employed?

Brian Bissaker: We have around 1200 employees and the bulk, the biggest single group is in our operations area, that’s people who process your transactions or who talk to you on the telephone in our call centres, so that’s around about half of the 1200 people; so we are a big processing shop. We have approaching a million customers and we’ll get that milestone some time next year, so there’s a lot of people we have to look after and make sure their transactions go through and they can talk to us and deal with us. The next largest section is probably our distribution people who are out on the road talking to people and selling our product and then we have marketing and product-ing and final compliance and all those other things.

Simon Hoyle: So you’ve got 1200 people supporting the better part of a million customers at what are Colonial First States assets, under management now?

Brian Bissaker: Yeah, we’re at around the 75 billion mark. This is in the Australian retail market we also have an institutional arm which is a sister company to ours, but just our retail market in Australia is 75 billion.

Simon Hoyle: Okay now that suggests there’s a fair bit of efficiency, if you can support that size business with 1200 people. How technology dependant are you on you know in maintaining that efficiency?

Brian Bissaker: Very technology dependent Simon as you’d imagine and our core, we call it our registry system, which records everyone’s details, how many, how much value they have with us and their units etc that’s a key driver in our efficiency and it’s a great system, it’s lasted the test of time, it’s very scaleable. So if you’ve got a great call registry system and you’ve got good Internet based capability, phone systems etc then you can get some pretty good scale of those.

Simon Hoyle: It must be a never-ending process though staying on top of that sort of issue?

Brian Bissaker: Always is Simon, it’s one of the challenges of the role and that’s why we’re all here.

Simon Hoyle: Now you’ve mentioned that in many facets the Australian superannuation industry in fact Australian financial services generally leads the world in technology, product design and so on. What’s always baffled me is how such a small market small population became so sophisticated. What are your thoughts on that?

Brian Bissaker: Yeah I think there’s a confluence of issues that has come together to give us this leadership of sophistication. If you go back to like society’s structure, if you like, we’re a very stable society, well governed democratic society, very well educated and we’re relatively wealthy, we’re well off you know we’ve had, we’ve been blessed, as a good, you know, farm resource sector, farm sector and now moving into the services sector. So we’ve had the building blocks to support a well educated, sophisticated financial services market, so, but on top of that we’ve also had strong government policies. You think about the super guarantee; well that’s done, since it was introduced in ‘92 so that’s 15 years ago, before that we had award based super, so we’ve had some strong government policy enabling our market to grow and when you’ve got markets growing like that it attracts the best and the brightest and Australia is a good place to live, so people like to come here and come and live in the capital cities around the place and focus on financial services. So I think it’s a range of those issues and indeed it’s not just superannuation and funds management where we lead in the world, in many banking and finance applications we are right up there, because of those elements that I’ve just spoken about.

Simon Hoyle: Now there’s been talk around the place of the idea of establishing Australia as a financial services centre, certainly a regional one and the idea of turning financial services into a real export industry. Are there things that we can genuinely export to the world? Do we have expertise that can translate into other markets?

Brian Bissaker: I think there are, certainly there’s intellectual property IP around how you go about servicing and getting scale in areas like superannuation and funds management, I know that we have, and I’ve certainly talked to a number of delegations from all around the world who come down to Australia to see how it works because our pension system, if you like our retirement system is seen as world leading and indeed it was ground breaking; the super guarantee and how that underpinned that growth. And a lot of world economies are grappling with this growing demographic problem of people who are aging and they need to sort it out pretty quickly so we do have a lot of people from the UK the US even from China who come here and Asia, to look at the Australian model. So we are seeing increasingly that Australians are going offshore and I think particularly with Asia I think we’ve got a real potential with the closeness of time zone, the links we’re developing in there, and Asia is not as advanced as we are in the pension space, for us to get in there and do some good things.

Simon Hoyle: Is Colonial First State doing anything specific in terms of taking its expertise off shore? If I remember correctly you have investment professionals in the UK already.

Brian Bissaker: Yes we do, and we also have them through Asia and we’re getting into the US and that’s our, as I said before, our global asset management division CFSGAMD it’s called; so those guys are busy developing that and have done very well in those markets. From my side, I look more at the what we call the platforms and superannuation style of business, we are doing some reconnaissance up into various parts of the world and certainly the CBA has had some, it’s got some toe-holds in places like China and Indonesia etc etc, so we’ll see what may come of that in the future.

Simon Hoyle: Well you’ve got a large growing business you’ve got 1200 people working for you. What particular challenges get thrown up by managing that number of people in an environment that’s so competitive and so changing?

Brian Bissaker: I think it’s trying to keep them motivated and focused, there’s a lot of distraction a lot of full employment across the economy, so to keep people really wanting to be here and to be part of the team, we’ve got to really focus on the culture we drive. It’s a culture which is a successful one which has a lot of trust and team spirit as part of it and can leverage each individual so that people feel good about being part of the organization and you can’t underscore this issue around trust. In my view it is the human element which really does set great companies apart; where you get excellent people working alongside each other, who can trust each other to delegate properly to get the job done, to get back to you etc etc and it does, you see, it does give you a leverage. So it’s ensuring that the environment is set right to keep the people happy and keep them on board and setting a good governance around what you’re doing. We talked earlier about sustainability investing and one of the big themes in there was the way that you leverage human capital in an organization and if you do it well you get leverage and you can create sustainable investment return, because if you get the people thing right, it’s hard to copy that, so we focus a lot on that and if we do that well, then we think we should have a better chance than average in going well in the future.

Simon Hoyle: Well we’ve been talking Brian Bissaker, CEO of Colonial First State. Brian it’s been a pleasure talking to you today and thanks very much for joining us.

Brian Bissaker: That’s fine thanks Simon.

Transcript

You’re listening to the People Planet and Profit podcast. My name is Valerie Khoo and I’m a journalist, author and entrepreneur. Every episode I’ll be talking to experts, innovators and leaders who are a making a difference in the world of corporate sustainability. This episode we’re talking about how your purchasing decisions can make a huge difference to the environment, human rights and the lives of farmers and workers in developing countries. We’ll also be talking about how an increasing number of Australian corporations are paying closer attention to who is involved in their supply chain. Many corporations are setting guidelines for suppliers to ensure that they’re not involved with suppliers who facilitate unethical behaviours toward workers or who support processes that may destroy the environment. But are these guidelines enough. We talk to Bronwyn Darlington founder of Rise Up Productions. The company designs and produces ethical and sustainable clothing and cotton goods for consumers and corporations. All their profit goes to charities such as World Vision, Opportunity International, Oxfam Australia, Habitat for Humanity and the Fred Hollows Foundation. Bronwyn has held senior positions in manufacturing and mining companies including Blue Circle Minerals and Blue Circle Southern Cement both key heavy industry businesses for Boral, and has consulted on behavioural sustainability and industrial relations and business strategy to companies like mining giant Exstrata Coal and many more. As a result of her work with Rise Up Productions a company she founded in 2006 Bronwyn also consults to corporations on matching supply chains with sustainability objectives and principles setting practical and achievable guidelines to ensure ethical cradle to grave strategies. Bronwyn thanks for joining us.

Valerie Khoo: Bronwyn lets start with Rise Up Productions, what exactly does your company do and why did you start it?

Bronwyn Darlington: Well, what we do is we design and we produce ethical and sustainable products, a range of products where the market actually has a need, or is perhaps ready to take those on, and these range from fair trade clothing, both for the promotional corporate market, but also within the fashion sector, I know for me, I want to be able to wear clothing that has been fairly traded. We also produce organic or alternative materials such as bamboo, there’s some great fabrics that are being created through very sustainable practices, we also provide a recyclable or recycled products very much into the conference market, so where a company’s wanting to have a carbon neutral conference or a sustainable conference, we provide all the normal materials that you would use, from pens, through to papers, through to plastic folders and name tags that are 100% recycled material, they’re recyclable and at the end of the conference they are fed straight back into that process.

Valerie Khoo: So where did the idea for this company come from?

Bronwyn Darlington: Where we came from and why we started really came out of a thought from my mining industry experience, where I spent a lot of time working with individuals helping them understand that while their company says that they need to be sustainable, they need to be ethical. How that practically means in a day to day basis, is that it’s all about choice, it’s about choice in whether you floor it on the big mining trucks and use extra fuel and you use up tyres, or it’s whether you actually take a conscious choice to modify your behaviour. So one day I was thinking you know why can’t my consumer choice do all the good that I want to do, why can’t I know that from the very growth of the seed or the fibre whatever it is, right through to the end, that good is done all the way along the line. So there was a moment in time, where I had somehow, we’d been working through a mining site and those guys had really got it, they’d really embraced it, and they’d changed their action, but I couldn’t simply buy a t-shirt for my son for his birthday that met the same objectives. I couldn’t say that socially, the process had protected individual, community, human rights or environmentally, that it was organic or I understood that the manufacturing process didn’t poison the poor farmers who are making it and economically I was sure as eggs, someone was buying that fantastic yacht, that one day I’d particularly like and at the same time we need to be able to support those who can’t help themselves.

Valerie Khoo: And you thought you’d personally do something about this situation?

Bronwyn Darlington: So I thought well I'm a 21st century girl in Australia and I have the choice to do something about it, so I thought I would. So that started the idea of what was a small project being Rise Up Productions; making some clothing, and has turned into a much larger business and really now, what we do is, we design and produce ethical and sustainable products across a number of markets from promotional fashion business and wherever we can see that a product is not easily available that meets our criteria and that’s really socially protecting individual, community, human rights, environmentally looking at agriculture and the manufacturing process right through to legacy with the minimal footprint and economically giving value to the poor and disadvantaged, right through the production and the distribution of goods. So really, that’s actually what we do now. To fill that gap and recognise that people’s attitudes and perceptions and state of mind is shifting just like mine was and that now’s the time to do it.

Valerie Khoo: Well, that’s certainly a huge undertaking. Now you started the company in 2006, so what are some of the concrete wins or advances that you’ve had since then?

Bronwyn Darlington: Okay, it’s been a significant journey and one of the challenges has been to gain the certifications, recognisable internationally, the difficulty in starting up something like this is that there is not a lot around that’s the same, so if I couldn’t buy a t-shirt, just looking at the whole process of manufacturing of the shirt identified that there’s a lot of smoke and mirrors at the moment, but there is a lot of good work being done with fair trade and with organic and certified products and also to be able to address the human rights element. Within Australia we have a certification process called the no sweat shop certification which we’ve spent the last time since starting gaining fair trade accreditation, which means how things are traded, traded fairly, when we buy internationally but also the environmental certifications. So when we say our products are organic they’re certified organic and that standard is an international standard and anything that we make in Australia is certified no sweat shop manufacture, so it’s closing the loop. And as part of that process we have designed and produced promotional products and promotional t-shirts to support people like the Nature Conservation Council and the Walk Against Global Warming and the Save The Planet to test it out and we’ve also begun the partnerships with organisations like World Vision, Oxfam, Opportunity International, Habitat For Humanity, Compassion Australia; to be able to close that loop. So we have designed the products now, we have tested them out to the manufacturing processes and sold products, but we’ve also been able to get that certification that fundamental and important certification in place.

Valerie Khoo: So you’ve designed particular products and linked each of those products to a particular charity or aid organisation is that right? So the more that, that particular product is sold the more the respective charity receives, is that correct?

Bronwyn Darlington: We have agreements with each charity that’s linked with each item of clothing, so though, for me, it was very important to be transparent I would never want to be perceived as someone who in all honesty who was making money off the association with a charity. And while we do need to look at return on the investment of the social dollar spent and I have no beef about that at all I think it’s a very important part of it, for us, we felt that this was an opportunity to have a paradigm shift and to use the commercial methodology to support not for profit ventures. So for example, when we had the World Water Day; which was back in March of this year, we partnered with World Vision and produced t-shirts that they were sold for $40 and $10 which was the profit of the t-shirt went to World Vision.

Valerie Khoo: Is it just t-shirts or are you doing other products?

Bronwyn Darlington: So, for example another, as we go forward, we have the flip flops which we happened to be recycled rubber flip flops we call them thongs in Australia but I'm learning in this global community to adjust my language just a little and that’s a partnership with OpportunityInternational, which is a wonderful micro-finance charity who, for those who aren’t aware provides funding for the poorest of the poor to help them go through business and raise themselves out of poverty. It’s the concept of give someone a fish and they feed themselves for a day, teach them how to fish and they will feed their family. So for us again, each item of clothing is attached with a specific charity but that’s not the most important part, it’s the product that comes to market that is sustainable, from the cradle right through to the legacy and for us that’s the key part of the legacy.

Valerie Khoo: So apart from the products that you have linked with these charities do you have other products that are available to consumers? Do you have other products that you have sourced for corporates? What else have you got apart from the products that are linked with the organisations?

Bronwyn Darlington: Yes we do Valerie, we have a whole range of promotional products to be able to support corporates who are trying to match their words to the market, their sustainability objectives and their commitments with supply chains that include, not just what they make themselves, but how they present their brand to the market. So these are products like t-shirts, where they are fair trade, t-shirts where they’re organic or any promotional product that they use to present their brand, but that needs the whole story very much told right through it, so we have also recycled and recyclable products. We’ve looked for the gaps, looked for where in our business, where we could, not just provide for ourselves, something that met our own standards and we have begun to develop those products to be able to bring them to the marketplace.

Valerie Khoo: And has the corporates been responsive to this?

Bronwyn Darlington: Very much so, as part of the whole process I provided and worked with some corporates just to assess what the interest was and actually not so much the interest, but their willingness to act. There is a lot to be said about saying that this is what we want to do, we want to do good, but actually having the will to act when there may be a price point that they are not necessarily quite so willing to pay has been a bit of a challenge. So I conducted a survey with actually thirty eight companies to actually, just get a real sense of whether green or socially responsible supply chain transparent products are actually important to their business in the first place and then to trace that through to consider what impact it would be to their brand for example if those products, not just what they make, but what they used to present their brand were actually found to be as poor in social or environmental substance and to think of what the impact might be if their poor environmental human rights or labour practices were actually publicly associated with their products. And that actually has provided a great link into the corporate sector where people are very clear that they can’t just talk the talk they actually have to walk the walk. But there is a gap, there is a gap in what they can actually do, to do that, so I have had some fabulous conversations that are turning into more than conversations with organisations such as Intercontinental Hotel Group, who are very keen to ensure that those who stay at their hotels have a good experience sustainability wise, not just a good experience in the hotel. So they are very much looking at their whole experience of the holiday or the event in the hotel and the sustainability impact and preferences of their customers.

Valerie Khoo: So which countries do you get most of your products from? And tell us a little bit about the process you’ve taken to ensure that your goods are ethical and sustainable?

Bronwyn Darlington: We, offshore, we buy our products principally at this point, through India and Pakistan and only through our supply chain which is fair trade accredited. Perhaps I should just stop for a moment and explain the difference between ethical and sustainable when it comes to a supply chain because it is a bit confusing. When you think of the elements of bringing a product to market. There’s really how the raw materials are produced and for us, in what we’re looking at, either the raw materials are recycled such as in polypropylene, a version of plastic, or it’s organic and organic isn’t the answer to everything but as part of a process is very important especially for the farmers who are growing the product. Once the raw materials are created how they are traded is actually very important and we are all more aware of the Make Poverty History campaign, and the very core of that is the ability to fairly trade the products that the poorest of the poor make. So for us, our supply chain is inclusive of the fair trade certified products, which means that the cotton we buy, the price we pay, is negotiated at the farm gate, it’s not based on the subsidised rates set across the planet, across the globe, but on what it takes for a farmer to truly grow that cotton and stay on the farm, for his kids to go to school. So that's fairly traded, so it doesn't disadvantage the farmer, they are paid when they deliver the goods and in all reality many of the farming practices and the trading means that many of these very poor farmers are not paid for up to three months or four months after they actually provide the cotton in our circumstance. The next step is actually how things are manufactured, so you have, how the raw materials are produced? How they're traded? Then how the product is manufactured. And for us if it is not manufactured as part of the fair trade process, which does not mean that it’s certified right through the whole supply chain for manufacture, but they have standards in place to ensure the poor are not disadvantaged. We have the no sweat-shop label certification, so, and the final part of that is what happens to the product at the very end of it. So that for us it’s either recyclable or reusable or biodegradable.

Valerie Khoo: So if you’re dealing with a major corporation who's ordering a whole heap of t-shirts for their company say, for the City To Surf or something.

Bronwyn Darlington: Yes.

Valerie Khoo: They know you can track your supply chain and they know right down to the last farmer who's produced it?

Bronwyn Darlington: They can, what we include as part of the products that we bring is the story, the people who are involved because when it comes down to it people make our products, when we put on a t shirt or put on a pair of gloves or thongs or whatever it might be there's been some real people, they might be out of sight but they really shouldn't be out of mind. So what we are building with that, is the stories, that's again where the charities come into play, where we’re linking in to be able to help highlight the stories of those who are making the products for us, is that you can actually have a positive feel when you buy something not a negative one. A positive experience, that when I'm wearing my corporate shirt for the City to Surf it actually aligns not just with what the corporate says, but what I personally believe and these are the personal stories of the people who were benefited by my choice.

Valerie Khoo: This sounds like a huge exercise on all fronts, so what kind of support have you had? Have you done this on your own? Or do you work with a team? Or do you have consultants?

Bronwyn Darlington: I think, we could be best described as the virtual workplace and I have been very much supported by some fabulous pro bono support from people like Blake Dawson Waldron, a fabulous legal firm in Sydney, through to Westpac, who've been wonderfully supporting, but we also have a range of networks of people who come in and out as is necessary. As anyone would understand, starting up something like this has actually been a very big exercise and because it's in a new space in the marketplace it's been very hard to know exactly what would happen next. To be able to plan, and I don't come from a background where I'm backed by a multinational corporation, it's very much a passion of the heart, but also with the business discipline to go forward so I do have a small team that works with me. I've really been supported by the community and also very strongly, the business community which is very important to be able to, for them to demonstrate that this an issue that they want to do more in and to be able to tangibly do that.

Valerie Khoo: So what's been the most challenging part of getting this company off the ground so far?

Bronwyn Darlington: I think it has been negotiating in a space that hasn't existed, that we have been able to find, so I come from, as we started out, but yeah, this was tough and I come from the mining industry and heavy industry, so while that gives me a very solid understanding of the critical issues of environment, corporate social responsibility, health and safety, and the governance issues and the international issues relating to that. Being able to work in the retail or manufacturing space, has actually been a challenge a bit exciting and I think the other challenge has been just to almost have the strength to keep going when it has been really hard work. So any start up is hard work but this is something that has been going, has required me to create contacts with India and Fair Trade and so many other organisations that I have not had experience with in the past but it's been a challenge to actually get some of those things and have the patience to work with a not for profit sector to get things across the line.

Valerie Khoo: So what’s been the most rewarding thing so far?

Bronwyn Darlington: Actually making the steps, getting the certification, realising this is the time, the climate is right, I think it's been so exciting when people have got onboard and I’ve realised that while corporate Australia does talk the talk very well there is a new shift to back that with real action and that the power of that to impact lives across the planet is enormous. So the best part really has been to see, like the baby being born and to realise that the vision I have, that the single dollar that we invest can be recycled, so far through to the benefit of so many, and that others actually also believe the same thing.

Valerie Khoo: So I understand that apart from encouraging corporates to buy your promotional products you’re also talking to many Australian corporations about their sustainable supply chain within their own organisations and their own sustainable purchasing decisions. So what are you doing in that in that area and where are we at?

Bronwyn Darlington: What we realised is, when I started to talk to people, just to ask them the questions about their supply chain and not just about the products they produce, but the products that they use, there was a lot of responses of ‘Oh I’m not really sure, I know we have a policy on that, Oh gosh I didn't think about it as in relation to our brand risk, gee, when I do think about our risk to brand and the amount of money we put into protecting that brand we actually are significantly at risk about the products that we use.’ Whether it’s a formaldehyde issue in a blanket, or it's some type of poison in the paint, that could really shoot us down in flames. so that has led to some work helping corporates actually bridge that gap, to understand not just what it means in principle, but, because I come from a behavioural sustainability background, to look at what it all comes down to; choice. And we do make choices and corporates make choices, but they can set the parameters, set the principles, but individuals actually have to interpret those down the track, so that has lead to a range of work with corporates, understanding what their objectives really look like and how that works itself out within their business, both to mitigate the risk and minimise the risk to their brand, but also to maximise the benefit of purchases they are already making to people who actually need that benefit.

Valerie Khoo: So in this situation there isn't really an off the shelf answer for corporations, because unlike areas like accounting or law there aren't accounting guidelines or corporations law to refer to, so where do you think companies can start? What can they look at within their organisation and where can they go to for help then?

Bronwyn Darlington: In all truth, there are a range of corporate social responsibility standards, environmental legislation and certainly community expectation in addition to a human rights requirement nationally and internationally. The challenge is not so much being able to define where they want to go, the challenge is making this an action, walking the walk, and the greatest resource for doing that is actually within the organisation themselves. This is a people issue and it's very much one where solutions come by action, action is something that we choose and they need to be able to tap into the rich source of their own employee base. In an addition to that, they need to be able to (and it is available more and more) look and challenge their supply chains into answering some specific questions. Questions like; who is actually making my product? What environmental impact is there in the dyes that are being used? To actually ask some clear questions, but say; what are the working conditions of the people who make this for me? And what is the fuel usage? What's the carbon footprint? Let's ask some difficult questions. And there are some good Government resources available as well and I guess the question is, first to start with looking for help within their organisation and then to be able to look at what else is available outside and there is more and more available everyday.

Valerie Khoo: Some of those questions that you suggest that the corporates pose, like, who is actually making this product? And is anyone actually being exploited as a result? Why do you think many Australian corporations haven't bothered asking these questions before?

Bronwyn Darlington: I don't think we've thought past the first tier, in reality we've been very busy cleaning up the supply chain of what we make not just what we use it's also been a very hard question to get an answer for, anything that is made in China is a huge challenge, it doesn't mean that everything made in China is problematic, but for example, once you look past the first step offshore, it is increasingly difficult to get a straight answer that you can trust because it has been in the too hard basket. I think people have not, corporates, have been almost satisfied with the, it's out of sight out of mind, but recently the exposure of corporates to the damage that comes from being publicly associated with someone in your supply chain performing poorly- it's too great a risk. So I think also the other side of that has been very preoccupied with defining to the market our position on sustainability, our goals and our ambitions, whether it's to be carbon neutral or to be a good corporate citizen. So I think now is actually the time we should be very clear with where we want to go and it is appropriate to ask those questions now and how we are going to get there.

Valerie Khoo: So Bronwyn, not everyone is as passionate as you in this area and I know from previous conversations with you that much of your passion for this area is because you simply think it is the right thing to do. How do you engage people within corporations who understand what you’re saying but don't necessarily prioritise it in the same way you do. So what reasons can you give them to push their buttons?

Bronwyn Darlington: There's a lot evidence to suggest very strongly that those companies who pay attention to their ethical and sustainable practices actually perform better over the long term and actually the more medium term now, as we look at it, our ability to be able to influence and use the corporate strength to affect our planet it's not an option any longer it's just an essential. Our government, whichever side of politics you’re looking at, are making some very grand predictions and some statements and commitments as to where we will need to be. This is not going to be an option corporately as far as it being the right thing to do, it's the right thing to do for many reasons, and that's, whether it's protecting your corporate longevity, being able to deliver sustainable returns to your shareholders and stake holders or simply maintaining and being able to secure great employees, as a strategy for the employer of choice. People want to work for companies who match their own view and there is such competition over labour, if you are wanting to be able to attract the best of the best, you need to be able to look holistically what you’re offering them and it is very clear from research and evidence in the marketplace that being able to have a very strong brand sustainability wise, must be backed up with action. So for me helping push buttons, there's a lot of different levels and it can be very much the economic rationalist point of view that says this is actually very good for the bottom line, but where that's not simply and overtly the case, the ability to be able to minimise the risk to brand, but also attract and retain the right employees, in addition to being able go home, and when your grand kids or your children ask you the question; ‘So what did you do today? you can answer with a clear conscience of, well I didn't destroy the planet.’ Is actually making more of an impact on people.

Valerie Khoo: So I understand that your processes are ethical and sustainable, is Rise Up Productions sustainable yet? Have you turned a profit?

Bronwyn Darlington: Well anyone who has started up a company such as this one will understand that a profit is something we will have, albeit what we will give away but that this is very much a setting the foundation and as far as the sustainability, I see this as a very long term project. This is a company that we are building for the next twenty years, that's a sustainable long term position. We are putting in place all that is necessary to ensure that is the case but because we have identified components of every product to go to charities, we have really taken an approach that projects two years out what our profit will be and we are giving that away now, so that means as far as the sustainability we think that we've put all the business discipline in place and we are planning long term. The climate is right for this type of approach and the response that the market has given has been very, very positive.

Valerie Khoo: That's incredible. What’s your grand vision for the company, fast forward ten years for me and paint me a picture of what Rise Up Productions is doing then and how it's working with both consumers and corporations?

Bronwyn Darlington: In ten years time I can imagine that we will be a very strong and secure business, who is able to partner more and more with both corporates and elements of the retail sector. To be able to make this the norm. I honestly believe that within five years it won't be a, what are you doing on sustainability? that will be assumed, it will be, what are you innovating? What is your company leading in? And we will just be one of what I believe will be many companies who have taken this on and stepped forward. We may be a little ahead of the game in many ways just at this point in time, but we’re not going to be unique. This will be entrenched and just simply part of the way businesses do business and I see that we will probably be moving on to whatever the next thing is, but also, I believe there will be a shift in the way we see our social responsibility. The global community will be much more fluid and that we will be very much a part of that and looking for how we can motivate individuals and companies to keep going forward. So I believe, we will have a very broad range of products that are available to help people walk the talk, walk the walk and that we will be very strong nationally and internationally.

Valerie Khoo: Wonderful, thank you for your time Bronwyn. So if people want to get in contact with you to find out more information about your company where can they go?

Bronwyn Darlington: We have a website for Rise Up Productions which is www.riseupproductions.com. Which is one word and our information as far as the support that we can provide for supply chain management and sustainable and ethical reviews and behaviour is at www.darlingtonconsulting.com.au

Valerie Khoo: And if there's one last message you would like to leave listeners with what would it be?

Bronwyn Darlington: Well, Valerie, really I believe corporates have very little time just to keep talking about what they are going to be doing in this space or what they believe or what their values are, now is actually the time to act. I really see that customers in the market are going to be very sceptical about corporates who engage in this blue-sky dreaming without actually backing it up at every level of their organisation. I think the challenge is to take that and these good thoughts and actually turn them into action so for me the last thought is really to challenge corporates to look at the integrity of their statements and to actually back it up with their actions within their whole corporates.

Valerie Khoo: Bronwyn, thanks for joining us today.

Bronwyn Darlington: Thank you.

Transcript

Rebecca Stevenson: Welcome to the Telstra Enterprise and Government Podcast. I’m Rebecca Stevenson. Most of us can't see the computer networks that keep business operations running smoothly, but if the network goes down suddenly it becomes a big issue for everyone.

In this episode we take a look at a large entertainment company that operates in more than 4,000 physical locations across Australia.

Bruno Condello was the program director at Telstra Enterprise & Government who, together with a diverse team of 300 people, upgraded this customer's network.

We began by talking about what made this project so complicated.

Bruno Condello: Basically, you know, they have a number of sites across the eastern seaboard and at some of those retail outlets where they have – they have currently more than network point into that environment to service the different business arms if you like so our challenge was moving away from or consolidating all those different networks into a one single network platform whilst still being able to maintain separation to meet their regular total requirements.

Rebecca Stevenson: Can you describe for us the scale of the network. I understand as you said there is more than – there are some 4,000 sites and in addition to that four separate business units that needed to be upgraded – quite a complex exercise here.

Bruno Condello: Yeah that’s right. At the time it was really one of the first, in certainly Australia, to look at how we can consolidate onto that common platform and roll out to all the different business groups, so you know 4,000 – over 4.000 physical locations but you still have the separation where some of those locations had common, the common business groups going into that one location. Added to that was the view on Australia due to go into two consolidated data centres ultimately. But that was moving from their current data centre locations which spread from basically Victoria, New South Wales and southern Queensland.

Rebecca Stevenson: Now on the technical side, the customer migrated from an old Frame Relay network technology to Telstra’s Next IP and Next G wireless network. Why was the old network struggling to cope?

Bruno Condello: The customer had a mixture of dedicated data network which we termed the DDN Network and Frame Relay. It certainly provided a function for the common business at the moment but where the business was going in terms of consolidation and in growth, in allowing them to add applications into the future – it didn’t really suffice.

Rebecca Stevenson: Now what were the other business and legislation or regulatory issues that were driving this move towards the new network?

Bruno Condello: The regulatory requirements were that traffic from one part of the business could not impact the other part of the business so there was a great emphasis on the design to make sure that as traffic moved down the link if you like, any bursts in traffic weren’t going to impact the other business communication and there was no way of I guess any intrusion into that traffic as well from any other means, so the security aspects were a great emphasis as well.

Rebecca Stevenson: How complex is that exercise?

Bruno Condello: You could say very, but it is certainly very complex in terms of maintaining the communication from you know the retailer outlet and right through to – into the data centres to make sure that that business component is not impacted because there was a lot of multiple providers involved – you know the end to end solution. We needed to basically work hand in hand with them to make sure that the hand off points provided that layer of security and that layer of separation.

Rebecca Stevenson: Okay. And tell me about some of the other services and applications that were rolled out as part of this. I understand there was some video conferencing involved.

Bruno Condello: Yeah. Video conferencing. We had video conferencing delivered to a number of the head office locations. That was one aspect the other components were a managed mobile solution where we gave them greater control and I guess greater flexibility allowing use and structure.

The other component was managed service desk so having a single service desk function for each of their product line; we basically consolidated them into a common service desk. We wrap around all the ITEL functions in terms of the changed incident problem management components as well, so really giving them a better outcome as a business to service and maintain their business ongoing.

Rebecca Stevenson: Now the service desk as you mentioned is something that a lot of other large customers have been implementing. What’s the main appeal here from a business perspective?

Bruno Condello: From a customer’s standpoint and even from Telstra’s standpoint you’ve got one common area that will support customers. So I guess any dependencies are in products such as if you’ve got video conferencing that’s also depending on the network. Any calls that come into that environment will see what the dependencies are from an intern perspective. We will be able to learn it as well from other customers about what problems have been incurred in the past and then putting in resolution plans for those if they should occur in the future. So it’s really giving them a better outcome from a servicing perspective.

Rebecca Stevenson: Now you’ve personally been involved in all sorts of network projects over the years. What have you learned about upgrading corporate networks and working in large teams from this particular project?

Bruno Condello: Certainly the customer aspect should not be underestimated in terms of what role they play and the key dependencies on the customer so the delivery of a network obviously involves all the teams to come together to make sure that the goal and the focus is there but the context of what that means from a customer aspect is valuable in relaying that to the teams.

Rebecca Stevenson: Okay. So finally, what’s next?

Bruno Condello: We’re currently looking at the customer’s business and I guess it’s strategy for moving forward and overlaying a technical road map from where our organisation cluster is moving and understanding what the customer’s road map is for its business and really bringing those together to make sure that, I guess we can allow them to leverage the technology that they require.

Rebecca Stevenson: Bruno Condello. Thanks for taking the time to speak with us today.

Transcript

Welcome to Telstra’s innovation podcasts, a series of conversations with business leaders around innovation in a connected world.

Hi, my name is Chloe Munro and I’m the Executive Director of Innovation Projects for the Digital Future in Public Policy and Communications.

This is Telstra today, conversations with Telstra in the 21st century. I’m your host Cameron Reilly.

Cameron Reilly: Excellent, well thank you for joining us Chloe.

Chloe Munro: My pleasure.

Cameron Reilly: Before we talk about your role at Telstra, let’s get a little bit of your background because you have an accent that sounds like you’re not from this part of the world. Where are you from originally?

Chloe Munro: Well I’m actually, originally from Scotland, people often think I’m English because I spent a long time working in London, I worked in Kenya briefly and then in New Zealand and now I’m very happy to be here in Australia.

Cameron Reilly: How did you end up in the colonies?

Chloe Munro: (Laughs) I truly don’t think of the Southern hemisphere as the colonies at all.

Cameron Reilly: Oh come on, I still think secretly all British people think of Australia as a prison country still, don’t they?

Chloe Munro: Ah, not at all, in fact I for a long time I wanted to come to Australia. When I was twelve, I saw an exhibition of Arthur Boyd paintings that completely blew me away and I think I have always had a very different picture of Australia because of that than the sort of ‘throwing the shrimp on the barbie’ kind of image that a lot of Brits may have had and so I've never seen Australia as a colony at all, I've always seen it as a place that’s dynamic and colourful and lively and, in many ways, a relief to get away from the slightly sort of grey and negative environment that you experience in the UK.

Cameron Reilly: So how long have you been out here?

Chloe Munro: I've been in Australia for 12 years now.

Cameron Reilly: And how long at Telstra?

Chloe Munro: Four.

Cameron Reilly: OK, and before this role you were running HR at Telstra?

Chloe Munro: I was, I’ve really been enormously fortunate to have the opportunity to move around the company a bit, so I came here to work in HR and then I moved into a broader sort of business operations role associated with transformation. First in the wireless business unit when we set up the new business unit to drive the build of the NextG® network and that was a fantastic project to be associated with. And then I moved into IT to perform a similar role. And now I’ve moved back a bit more into an area which is more closely connected to some the things I’ve done earlier in my career, in public policy and communications.

Cameron Reilly: So Innovation Projects for the Digital Future, is a very grand sounding title and I have got to be honest, I think when most people in the general public think of Telstra, innovation usually isn’t the first word that comes to mind. Do you think that’s unfair? Do you think Telstra deserves a stronger reputation for innovation?

Chloe Munro: Well I think it is a bit unfair. We’re a company which on the one hand provides very fundamental services which people rely on absolutely, and you don’t tinker with those in a dramatic way, so there’s always going to be this sort of bedrock of continuity of service. But at the same time when you look at the changes that have happened in telecommunications and the way particularly over the last three or four years we’ve been moving into this media comms environment, there has been tremendous innovation and the transformation that’s taking place has been quite extraordinary in terms of the way we do so many different things. And I think our customers will experience this more and more, as we’re only half way through the 5 year program Sol rolled out, so I think our customers will experience this more and more over the next two or three years. But my role is very much about thought leadership, not just innovation in terms of products and services, but also innovation in how we as a company present ourselves. How we as a company engage in public debate, how we lead as a corporate in Australia and I think there are many ways in which we are quite differentiated. And that’s innovative too.

Cameron Reilly: You’re right, and I think obviously Telstra has a very large footprint in Australia and its role in Australia is very significant, and if Telstra is able to lead the way in a sense in terms of how a company of that size engages in the Australian marketplace, there’s a lot of great things that they can do. I know that under the leadership of Sol and Phil Burgess, you’ve been running some online communities outside of Telstra, ‘‘nowwearetalking’’, is probably the most well known, and I know that in your role you’re looking at how Telstra engages with other online communities. Is that something you can talk to us about?

Chloe Munro: Yes, this is an important part of my role and it’s still at quite an early stage of development. Fundamentally what we’ve been doing is a lot of foundational work in how our information can be more readily accessible through search and through the online environment. ‘‘nowwearetalking’s’’ been rebuilt, so it’s more in a sort of, web two dot zero environment so it has more interactive capabilities. and an ability for people to engage in active discussion with us in our space and find what they need to know about us very directly. But what we’re starting to move into is to think how we can be active participants in third party sites. And we’re starting really essentially by listening so we’re looking carefully, at where people are talking about us and about issues that are of interest to us. What kinds of things they are saying, so looking at Blogs, looking at forums and our next steps will be to enter some of those places, very transparenlyt, as Telstra. We’re not going to sort of hide behind any sort of alternative identities, so people will understand that we’re there in our own right and we’ll start engaging in the conversation, but really respecting the terms of those communities in which we’re operating. It’s not something where we want to just race off and you know throw our weight about in the online space we really want to demonstrate that we can be a corporate citizen within that environment.

Cameron Reilly: It sounds very clue-train; very conversational which is something that we don’t normally associate again with Telstra.

Chloe Munro: No. It will be a new way of doing business and I don’t think it’s just Telstra, I think, corporates generally.

Cameron Reilly: Absolutely.

Chloe Munro: You know, we tend to be, you know, we’re in marketing mode; we’re in telling mode. We want to be able to say, well actually, we’re participants in civil society, we’re, as you say, we’re an influential business. Our business touches pretty much every aspect of life in Australia. And so part of that goes with the responsibility of being engaged. So it will be a new way, and I’m sure we’ll make the odd mistake along the way but I think we can approach it with some energy and you know with some optimism that we can generate some new kinds of dialogue.

Cameron Reilly: I think that Telstra has already demonstrated that they’re prepared to try new things with ‘‘nowwearetalking’’, and even though it’s received a fair amount of criticism in the press and in the ‘blogosphere’ some of which I think is deserved. I’ve always felt that Telstra had to be given some credit for it, because as far as I know, they’re still the only large Australian company that’s even trying that kind of an approach to more transparent conversation with the marketplace. So you’ve got to get points for having a go

Chloe Munro: Well, thank you. And I think we’ve been very pleased by the attention that it’s got and we’re always going to be controversial in some of the things that we do and that’s not necessarily a negative either, but it’s very important for us and obviously, and this is part of our business so perhaps more than any other company, it’s important that we’re present there just to demonstrate that the online world is a real part of society and if you want to be active in society you really need to be there and that’s what we’re doing.

Cameron Reilly: So the Internet isn’t just a fad then?

Chloe Munro: (laughs) Absolutely not, it really is the most game changing technology that you can imagine. It’s, I think, those of us who are active in this universe, we have only really scratched the surface in the ways in which it’s changing the landscape. One of the very important things that I’m working on is climate change, if I can sort of segue into that, and when you see how the internet creates opportunities for business activities and people’s private activities to be much less resource intensive, really taking huge slabs of energy out of the way we get information, the way we get our entertainment. That is something, which really is game changing, and there’s no question, we can’t afford not to take maximum advantage of the opportunities that the Internet creates. So no it’s not a fad, it’s just a huge, huge change agent in society.

Cameron Reilly: I want to talk about Telstra’s position on climate change in a second but before we get into that, with regard to online communities, you say that Telstra is listening at the moment?

Chloe Munro: Yes.

Cameron Reilly: So it’s not ‘‘nowwearetalking’’ it’s now we are listening, which I think is a good step, and in my discussions with marketers and PR people in Australia over the last few years, I have often talked about the fact that your customers are talking about you right now, online, in Blogs, on Twitter and Facebook and I get the sense that most people in marketing and PR, not only aren’t listening yet, they don’t even really know how to listen. I’d be interested to know how is Telstra going about keeping a track of what people are saying? Do you have people on staff who are paid to listen in on forums and track Twitter and those sorts of things?

Chloe Munro: Well we basically have a monitoring service, just as we have a media monitoring service. We have a monitoring service where we’re looking at, you know, picking out what’s being said on forums and on Blogs. It doesn’t necessary pick everything up but it is designed to give us a daily feel of the amount of conversation that there is and the kinds of themes that are coming through so we are not responding directly item by item at the moment.

Cameron Reilly: Yep.

Chloe Munro: Although obviously we respond directly to our customers in lots of other ways, but we are paying attention to the way that space is emerging, and I have to say still in Australia, it’s still very early days I think.

Cameron Reilly: Mmm.

Chloe Munro: I don’t know what proportion of the population are actively engaged in the blogosphere, and in forums, it would be very small compared to the number of people who read newspapers whether online or in print form. So the mainstream media is still, you know, a very significant point of focus for us. But what we’re really paying attention to is that sort of gradual shift that’s happening.

Cameron Reilly: I think, whilst, you’re obviously right that the people that engage in these online mediums are still small, by comparison they tend to be a fairly influential audience and there’s a lot of mainstream media journalists who follow what’s being said online and on Twitter and in Blogs and pick up ideas from there to use in stories.

Chloe Munro: Ahh, that’s absolutely right and again that’s still one aspect of the great success of ‘‘nowwearetalking’’, it’s quite clear that mainstream media, pays a lot of attention to what happens in that space too, and you know, so that’s emblematic so this is all directional really and I think in the next two to five years the pendulum is going to swing very strongly, we’ll be, by having paid attention now, we’ll be very well positioned to engage, as that becomes more, you know, if you like, the online space becomes more mainstream.

Cameron Reilly: Ok, let’s talk about climate change, you said some interesting things before. What is Telstra’s position on climate change?

Chloe Munro: Well, fundamentally what we’re saying is that we think that the most, if you’re concerned about climate change, the most unequivocally beneficial thing you can do is conserve energy and reduce energy consumption or obviously introduce more renewables into the energy mix. And that is something that makes, in a general way, makes good business sense. Independently of emissions trading schemes, accounting systems and offsets and all of that. So that there’s a sort of simple truth there. What we did last year was, we commissioned a report by some independent consultants, who really looked in quite a sort of creative way at how the use of telecommunications could help reduce emissions right throughout the economy, and we were pleasantly surprised by the result because what it demonstrated was, that with combining seven different scenarios which we called carbon opportunities, technologies which you could be imagine being adopted on quite a wide basis, you could see Australia’s emissions being reduced by as much as five percent. So we feel that this a is a very positive way of saying that in an industry like the telecommunications industry, can not just reduce its own footprint but can find ways of reducing the footprint right across the economy. So that’s been our message and it’s been very well received internationally as well as domestically, a lot of people have been asking us to talk about this and to explain the thinking behind it.

Cameron Reilly: Can you give us an example of one of the ways we can reduce our emissions by using telecommunications?

Chloe Munro: Well, one of the ones that is in the market place right now is high definition video conferencing and I think everybody has experienced video conferencing and found it to be quite intrusive, it’s jerky and it’s not the same as face-to-face so in the end you still, in Australia, end up jumping on a plane to go meet your colleague or meet your customer. The new video conferencing technologies that rely on this very high bandwidth and an IP delivery are a totally different experience. It really is like being in the room. It’s life size, the lighting’s right, the sound is very natural and suddenly this becomes a really viable alternative. So there’s one case and already companies are using this, and in our own case last year we held seven and a half thousand video conferences, which totalled 20,000 hours and we estimated it save 4200 tons in carbon emissions just by avoided travel. But this is very prospective in terms of the impact, and if you think of the lifestyle impact as well and the time that gets chewed up in travel. So not just avoiding air travel, but also less commuting. So we think that we are going to see more decentralised business districts. So all that traffic congestion that you experience travelling from the central coast into the Sydney CBD every day for example, people being able to work nearer their home and access their colleagues through these high band width applications. So that’s a very obvious example, is avoiding travel. Another very exciting set of opportunities, which are a little bit further out, are around remote appliance management. So ways of controlling thousands of appliances that drive energy efficiency. So, it could be more presence based power for things, things power up when you’re approaching the building, instead of being on standby all the time, or it could be, one that I particularly like is the idea that you would coordinate things like hot water heaters, air conditioning, fridges, with supplies of renewable power, so you actually use those appliances to store the renewable energy. Because one of the big challenges for renewables, of course is how you align that variable supply with the demand. So that’s a way of increasing the amount of renewable energy that could actually be used in the network as using sort of hot water systems as storage systems. You have to have a network - a telecommunications network - that is able to drive the control system. It takes a lot of other smart things as well. These are ideas that are adding up and could take very significant amounts of energy consumption out of the economy.

Cameron Reilly: Phil Burgess gave me a demo of the Tele-presence suite in Telstra ‘s Melbourne offices.

Chloe Munro: Oh fantastic.

Cameron Reilly: A few months ago and you’re right, it’s absolutely mind blowing how realistic it is. You would swear you were sitting across the boardroom table from three or four people.

Chloe Munro: It is quite remarkable how good it is. I mean that is a technology which has a road map that will be more in a multi point, multi company format. It will become more widely used and more flexible and it really is just like being in the room and you have to experience it to be convinced of it. But I think people’s habits will change very quickly when they have access to that kind of technology.

Cameron Reilly: Can we talk about Telstra’s carbon footprint? Are there plans for Telstra to become carbon neutral?

Chloe Munro: That’s not a target that we’ve set, and what we’re focussing on is quite simply ways in which cost effectively we can reduce our energy consumption. We think that is the straightforward way to make a contribution. So for example, it’s not well known that Telstra is actually Australia’s largest private sector user of solar power. We have over ten thousand installations around the country using solar power. Most are in remote locations but the alternative would be diesel, which obviously has much more carbon impact. We’re transitioning our vehicle fleet to LPG, which has saved around over 7000 tons of CO2 since 2002. So we’re moving our fleet in to more energy efficient mode but also we are using our fleet much more energy efficiently, by using smart applications, by using GPS on all our vehicles, we are able to route our technicians much more effectively, and that is making significant impacts on our carbon use. Similarly we have a number of projects around the energy efficiency of our buildings, you know, our networks and data centres. So that’s the approach we’re taking. It’s really driving down the ways that we consume energy in the business and we’ve got some very smart and very focussed people working in that area.

Cameron Reilly: You’re also of course one of the largest employers if not the largest employer in the private sector in Australia. Do you encourage your employees to work from home or to telecommute? You obviously have a lot of people in a lot of office buildings around Australia.

Chloe Munro: We do and we have quite a mix of that, I mean of course a number of our people particularly our sales staff are out and about all the time in any case, and we enable people with remote access, as you’d expect. So we’re certainly finding increasingly, people are working you know, maybe not working fulltime remotely, most people will come into the office for a portion of the week. Maybe a day a week or something like that, they work from home. Different parts of the business, have very different needs, but we’re gradually exploring different models of working and flexibility, it’s very important, not just because of the impact it can have on our carbon emissions of course, but it’s also important in terms of being able to offer employment, or keep engaged people with a variety of needs in the terms of the way that they want to work, and of course as a responsible employer is an important aspect too. So it’s taking hold in a different parts of the business in different ways, we are certainly encouraging that exploration and the use of our fine products and services to allow people to do that.

Cameron Reilly: Ok, let’s talk about this group that you run. What are the main objectives for the Innovation Projects for the Digital Future team at Telstra over the course of the next, say two years?

Chloe Munro: It’s a pretty high-level set of objectives really, because what our overall goal is about, is ways of building Telstra’s reputation as a company, which does innovate in the way that it creates value for society. And so that’s our sort of high-level goal. And then at a more practical level we’re pretty opportunistic in what we do, my role is really about stimulating activity and shaking the trees. We have a set of goals around for example climate change, which is about bringing into practical reality the kinds of ideas that were developed from the report that I talked about, so that’s one. And we have some objectives around how our online presence is viewed, and some fairly sort of short-term objectives around search results and so on and just the ability of our own material being more visible. So there’s a set of results it’s around that. But really the big-ticket item is about our reputation as a company, which is active and builds value.

Cameron Reilly: So some of these projects sounds like they’re internal and some are external to the company.

Chloe Munro: That’s right we have a mix so a lot of what I do, is co-ordinating across a lot of groups inside the company but equally, there’s a lot of external relationships that we’re building as well and that’s part some of the excitement of it really.

Cameron Reilly: Now you were involved in the recent 2020 summit that Prime Minister Rudd put together. How did you find that experience?

Chloe Munro: Well that’s certainly been a great networking opportunity all on its own. It was, look it was, fantastic, it was a fantastic experience to be there, it was very tiring because it was very full on for the couple of days it went on. It was an interesting mixture of rather theatrical plenary forums, which were pretty much aimed at television I guess, and intense group discussion and then a reasonable amount of time where everybody who was there was milling around in open space which was a great opportunity to talk to people who were in different streams. So I made it my mission to talk to as many different people as possible really. It was one of those events, when somehow the outcome is a bit less than the experience. So when you see the ideas distilled down to the final document, it never quite captures the full flavour of the conversation and to be honest a lot of the ideas that came forward and that were reported which were all about, more Government intervention, you know, taxing junk food, this sort of thing, were a little, I think disappointing. But not really surprising when you think of the nature of the event. The test I think will be whether 2020 is a starting point in terms of having more open discussion in civil society, more debate around ideas, or whether it all just gets funnelled into a process that is controlled by Government and you know there’s a report and then there’s consultation and Government comes out with its response and does a heap of things and that’s the end of it. I hope it’s more than that, but it s a bit early to tell.

Cameron Reilly: Was there one particular idea that you heard or were part of discussing during the summit that stand out as being extremely innovative or exciting?

Chloe Munro: To be honest no (laughs), that sounds awful, I mean my biggest contribution to it was actually about, Governments and this was around water as it happens, which is the stream that I was in but that Governments actually implementing a lot of things that they are already committed to. Since 1994 there’s been some real commitment about markets and pricing and Governments have found it extraordinarily difficult to do this. So some of the ideas are about getting on with the old ideas. One of the things that I did find encouraging though and this came up in a conversation- I took the opportunity of having a brief chat with the Prime Minister himself- and some conversations I had with a number of other people in other streams, like health for example, that really comes back to the significance of broadband and how broadband can change everything. If you think about how health and education are delivered and as I said before, how we get our information and entertainment. Whole new business models can emerge in that environment. Not just doing the same things differently, but finding things that could never have been done before happening entirely inside cyber space. So one thing I was really quite excited by was how people got that, and how many of the conversations I had, (not necessarily prompted), when I spoke to the Prime Minister, I didn’t prompt him about broadband, he brought it up and I don’t think he even realised that I was working for Telstra. But there is this sense that we are in an era where technology not on its own but coupled people’s ideas can really change the way we do things and really change it for the better. And that was the big take out I had, you know, I went there with a bit of a mission to raise these kinds of issues, but I found that people were actually raising them with me, and I find that enormously positive and exciting.

Cameron Reilly: And now that Telstra is a publicly listed company and is in charge of its own destiny. It sounds to me from what you’ve been saying that Telstra sees itself as having a large role to play in driving forwards this digital future for Australia, in setting almost some bench marks, in pushing forward, not only a vision, but the implementation of some of these grand visions that we’ve had for; I’ve been hearing about for ten years about how we will all live in this digital future that seems to be a bit longer in coming than some of us hoped a decade ago.

Chloe Munro: That was a long question. Firstly yes, we have a central role to play, I have to say I mean its always with this asterisk that in the end of the day, as a company we’ll invest where we can be confident that our shareholders will see an appropriate return for that. But clearly we see ourselves as being a key player in creating the environment where those things can happen and we’re doing some of those things. And so when you think about our Sensis® business when you think about Bigpond®, this whole new universe of media comms that Sol’s talked about - and absolutely we’re an active participant in creating that future. But it’s also about creating the environment where people are talking and thinking about this. So there are plenty of other players who will find opportunities and create business opportunities by understanding what that new future could be like. So it’s an important role for us, I suppose is to be a responsible corporate citizen. To raise the ideas and encourage development and discussion, just for its own sake and as a role that we can play in shaping the future of Australian society. So some of it is about where we invest and what we do, and some of it’s about where we stimulate the conversation and both of those roles are legitimate.

Cameron Reilly: I agree. Let’s wrap up with a couple of questions I like to ask everyone I talk to at Telstra Chloe. First of all you’ve been there about four years, is there one particular aspect of Telstra that you think is not very well understood by the public?

Chloe Munro: I think perhaps still, I’d say one thing that is not understood is the breadth and diversity of this business and the brand, I might be wrong about this because I am not in brand marketing, but people still think about the plain old telephone service and the range of different things we do as a company, I think probably is still not as well understood as it might be. I do think that’s going to change very rapidly and I think particularly with our segmented approach to marketing where we’re tailoring the way we interact with different parts of the market-place, and that’s going to gradually change. Going back to the question you asked me right at the beginning, where you said that Telstra is thought of as being a lumbering giant rather than a nimble and innovative company, I think there is still a lot of opportunity for our image to move and for that sort of innovative and dynamic aspect of the company to become more evident.

Cameron Reilly: I spoke to somebody else in Telstra a while ago, who said that ten years from now that Telstra will be seen as Apple® is seen today, I thought that was an inspirational vision.

Chloe Munro: I think there's a lot of people in this company who absolutely have that aspiration, that the iconic status that Apple® has, it’s cool, but also the sense that the products are just perfectly designed to do what people want, and they’re very intuitive. When Sol talks about; one click, one command, any screen, real time; it’s really about this completely intuitive way that people can use our products and services, and when we reach that, then it will be fantastic and I think we’re all very excited about the prospect that we can be that kind of company.

Cameron Reilly: Last question. What’s you favourite piece of personal technology at the moment?

Chloe Munro: I’m not really a gadget girl, and it’s really very much the thing of the moment, I think that I would have to say it’s my wireless card; I just love the fact that I can use my laptop anywhere with speeds that really are as good as I get on ADSL two plus. I really do find that sometimes I think, ‘Why am I lugging my laptop around I should just have my PDA,’ but I actually do find that is a fantastic piece of technology.

Cameron Reilly: Favourite website?

Chloe Munro: My favourite website? Well it would have to be ‘nowwearetalking,’ of course. (laughs)

Cameron Reilly: Such a corporate answer.

Chloe Munro: Now, I will tell you why. You know I really do search around because I’m interested in so many different things, you know, I’m going to different websites all the time and I don’t have one that I live on by any means and that really is the truth. I just love the diversity and the reach of it all, the fact that you can ask any question, and you can find answers it’s just wonderful.

Cameron Reilly: Very good, Chloe Munroe thanks for chatting with us today.

Chloe Munro: It’s been my pleasure Cameron.