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When
Siemens U.K. travel commodity manager Emma Eaton visited Business Travel Show
Europe in London earlier this year, she stayed at a different hotel than the
other hosted buyer visitors. Eaton checked herself into Good Hotel London, a
property she had recently added to Siemens’ preferred supplier list not only because
it meets the company’s quality and price standards but also because it is a
social enterprise.

Social
enterprises are businesses that allocate at least 50 percent of profits for
philanthropy, such as training and supporting disadvantaged people. In most
cases, including Good Hotels’ parent Good Group, the figure is 100 percent. All
Good Group profits fund Niños de Guatemala, a foundation providing education to
500 children in Central America. Good Hotel London also provides a training
program for long-term unemployed people in Newham, the borough where it is
located and one of the poorest in the U.K.

What’s a Social Enterprise?

Good
Hotel London

Marten Dresen
created the charitable foundation Niños de Guatemala, which runs three schools
in the country, after doing volunteer work there. The schools not only educate
children but feed them and provide psychological support.

Frustrated
by hustling constantly for donations, Dresen created his own funding channel
for the charity by starting Good Hotels as a social enterprise. Currently,
there is one in Guatemala and one in London, with a second scheduled for
Guatemala soon. 

Good Hotel
London, which also trains unemployed local people, is a floating hotel moored next
to the ExCel exhibition centre. Good Group head of community Maria O’Connor
said the hotel’s social credentials are increasingly attracting corporate
guests. “There is a lot of momentum on the back of COP26. Businesses are
getting more engaged,” she said.

The
House of St. Barnabas

This
members’ club in the London Soho house where Charles Dickens wrote A Tale of
Two Cities
can be hired in part or full as a meeting venue. The House of St.
Barnabas operates as a charity supporting homeless people. Many become staff,
who are given eight weeks of full-time training and all kinds of other support.

“Our
corporate membership has increased significantly this year,” said House of St.
Barnabas chief executive Rosie Ferguson. “If you can spend your money on
somewhere that has a high social impact as well as being a very good venue, why
wouldn’t you? Buying social is growing.”

Eaton is
one of a tiny but growing number of travel and meetings managers aiming to buy
social, a phase she defines as “the opportunity for corporates to use their
purchasing power to do good. Instead of just using our purchasing volume
through traditional routes, it’s looking at buying from the many wonderful
organizations which exist to improve the lives of people who need some help.”

Another
convert is Faye Carter, London-based head of experiential at Deloitte. Like
Siemens, Deloitte is one of 30 large corporations to have joined the Buying
Social Corporate Challenge, which aims to get them spending £1 billion annually
through social enterprises. 

Deloitte
has already used Connection Crew, a community interest company which employs,
trains and generally supports homeless people, to build stages and provide
other support at events. It also hired Luminary Bakery, which trains and
employs socially disadvantaged women, for a virtual “bakealong” as a Christmas
staff activity.

“Our aim
is to accelerate spend with social enterprises next year,” said Carter. “Why
not spend money on businesses that maximize their impact on society and the
environment?”

A
Changing Mindset for Purchasing

It is a
sentiment wholeheartedly endorsed by Eaton. “Instead of being part of an
isolated corporate world, you’re actually doing some good in society, which I
feel with the size of our purchasing volumes we have an obligation to do,” she
said. “I see this more and more as a duty than something nice to do.”

The entire
Siemens U.K. supply chain team became engaged actively in buying social two years
ago. “I was then able to think about how to apply it to my sourcing approach
and communications,” said Eaton. “In the last six months it feels like it has
really accelerated. It’s trickling through many different parts of our
organization now, not just within central supply chain management but going out
to our divisions as well.”

Outside
travel, Siemens has replaced its global stationery supplier in the U.K. with
WildHearts Office, a social enterprise whose profits go into a foundation that
addresses gender inequality and provides entrepreneurial training for people
from deprived backgrounds. 

Social
Enterprise U.K., the body which created the Buying Social Corporate Challenge, measures
corporate spending with social enterprises in terms of the number of lives
positively impacted. “Through that metric we have set ourselves a goal of positively
impacting as many lives as we have employees,” said Eaton. “We are hoping to
achieve one-to-one by the end of 2022.”

How far
that goal can be reached through travel and meetings sourcing remains to be
seen. “For travel it’s a huge challenge,” said Eaton. “We have just two hotels
as direct suppliers. There aren’t any airlines which are social enterprises;
there aren’t any train operating companies, car hire providers or anything like
that. That makes it difficult because obviously you have the most influence
with your first tier of suppliers.”

The
situation is healthier for meetings, with a good number of venues from which to
choose (see sidebar for an example). For transient travel, according to Eaton,
buyers need to think more in terms of secondary suppliers, in other words the
supply chain used by direct suppliers. 


It’s become more understood now that sometimes to be more ethical and do the right thing does cost you more. But if goods are going to cost more, then you think more carefully about your consumption of them. So in procurement terms it’s all about demand management.”

– Siemen’s Emma Eaten


“There is
a wonderful range of social enterprises that the hospitality and travel
industry could utilize,” she said. “Even if they were just to build in one or
two, when you think of the number of chains that there are, that’s immense.”

Social
Enterprise U.K. has given Eaton a list of potential secondary suppliers,
including purveyors of tea, coffee, beer, wine, toiletries, stationery and
plants. One example is Change Please, a coffee company whose entire profits are
spent on reducing homelessness. Since 2019, its coffee has been used by Virgin
Atlantic both in the air and in its lounges.

Eaton
addressed buying social in her hotel request for proposal process for 2022. She
discussed the topic in a virtual conferencing session with prospective
suppliers and included a question about use of social enterprises in the RFP
itself. “We’re also asking if they are sourcing locally because from an
environmental as well as a social perspective that’s very beneficial and I wouldn’t
wish to discourage such suppliers on account of not being social enterprises,”
Eaton said.

Answers to
her RFP question will be material to Eaton’s property selections. “Where there
is a good choice in the market, I will definitely use that as one of my key
decision-making criteria,” she said. 

Eaton
encountered a mixed response from hotels in terms of knowledge levels and
sincerity of engagement. She also acknowledges that many hotels are struggling
simply to survive Covid. But if nothing else “it planted a seed with those
hotels and hopefully that seed will grow so that when the pressure is off a bit
more financially, it is something they can revisit,” she said.

The
Question of Cost and Other Challenges

There are
conceivable challenges to buying social beside the paucity of social enterprises
in the travel sector. Eaton deals with each of them comfortably. The first is
whether it costs more. Eaton believes this question must be addressed in the
context of the human cost when a cheap supply is built on child or slave labor
or, more often, legal but miserable working conditions. 

“Everybody
has had to re-evaluate their ethics,” said Eaton. “It’s become more understood
now that sometimes to be more ethical and do the right thing does cost you
more. But if goods are going to cost more, then you think more carefully about
your consumption of them. So in procurement terms it’s all about demand
management. 

“And it’s
not always the case that things are more expensive. If I look at the example of
Good Hotel, it’s well within our rate cap. And knowing our spend is doing some
good for society is far more valuable than swimming in a pool at another hotel
nearby.”

Another
potential worry is supplier failure. “Most social enterprises are very small,
so it is a risk,” she conceded. “You would always have a contingency plan in
place for critical suppliers, but social enterprises tend not to be critical
suppliers. They’re not producing chemical ingredients. They’re producing simple
goods and services which could be switched should the need arise.”

Finally,
there’s the question of quality. “Understandably, the terrible challenges that some
people trained by these organizations have had to work through in their lives
means they might not always deliver the same customer service as someone with
decades of experience in that profession,” Eaton said. “You need a bit of
compassion and empathy to understand sometimes it is more difficult for them. 

“There are
pros and cons to anything but if you make people internally aware of the quirks
of the social enterprises and the need to weigh up against the benefits
delivered, then hopefully there will be that level of understanding. But if
there are improvements to be made, then as with any supplier, no matter who
they are, we would work with them to communicate that and to improve.”

That said,
neither Eaton nor Carter has had any bad experiences with social enterprises.
On the contrary, because social enterprises think differently from big
businesses, they often offer much more distinctive service. Good Hotels, for
example, has no televisions in its bedrooms. Instead, guests are encouraged to
mix in the downstairs area, known as the “living room.” Eaton spent two happy
hours there during her stay making new acquaintances with whom she remains in
contact.

Likewise,
social enterprise meetings venues are often more interesting than standard
hotels. And, as a bonus, said Carter, social enterprise leaders make excellent
speakers. “Invite them to come and speak at your event,” she said. “We’ve had
very good experiences. Many of them have amazing stories to tell.”

For any
travel buyer contemplating buying social, Eaton offers encouragement. “Start
conversations with people already engaging with social enterprises,” she said.
“You’ll realize how easy it is to change people’s lives just by doing your
day-to-day job.”

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