When doing good is good business: The Woolworths Holdings story

On a warm, sunny day, a private room at the Orrery restaurant in central London is the perfect setting for an inspiring presentation from Simon Susman, chairman of Woolworths Holdings. I have been very fortunate to count Simon as a great client and friend over a number of years, and I am delighted that he has arrived to talk about how Woolworths is setting the agenda on social responsibility and diversity – topics very close to all our hearts at The MBS Group.

Around the table sit 16 important opinion formers – CEOs, chairmen and advisers – who are eager to hear what Simon has to say and to share their thoughts on how we as business people can make a positive impact in the wider world.

Simon, who has been chairman of Woolworths since 2010 and was CEO for ten years before that, begins by wowing us with a breakdown of the retail group’s top numbers. Today the company serves 15 million customers across South Africa, Australia and the wider African continent through a network of over 1,400 stores. As owner of the retail brands Woolworths SA, Country Road and David Jones, the JSElisted group has enjoyed incredible growth and last year achieved revenues of £5bn, 80% of which came from private label products.

But Simon is not just here to show off the phenomenal scale and success of Woolworths. He moves on quickly to the heart of the matter – the Woolworths Good Business Journey (GBJ) strategy and its great success in turning Woolworths into a business focused on diversity, social development and sustainability. “Doing good is good business,” says Simon, and it’s clearly a mantra he holds dear.

Simon starts with diversity – a very challenging issue in South Africa but one that Woolworths has tackled head-on. He speaks proudly of how more than 60% of middle and senior managers in the South African business are black, and of the very important role of Woolworths’ black business procurement and development programmes.

Woolworths was among the first big companies to independently verify against the South African government’s black economic empowerment code – a critical step in helping it to manage organisational change. At board level the business is aiming to promote diversity too. Of the 11 board members at Woolworths SA, three are black (27%) and four are women (36%), and it’s an area where Simon wants to continue making progress.

“Doing good is good business”  Simon Susman, Chairman, Woolworths Holdings

It is not just on diversity where Woolworths is leading the way. The room is gripped as Simon explains the enormous social development work that the group has undertaken as part of the GBJ. I have always known Simon to be a very socially conscious business leader, but even I am in awe of the scale of good works that Woolworths now undertakes. It includes donations of surplus food and clothing worth £20m per year and partnerships with over 2,500 schools to provide resources for education, training and childhood nutrition.

Turning his attention to the environment, Simon excitedly tells us about the Eco Walkmates Recycled: a private label line of children’s shoes made from recycled plastic crates and bottles. The brand, which is run by women, is just one fantastic example of Woolworths’ work on sustainability and tackling climate change, which also includes using renewable energy sources wherever possible and promoting biodiverse farming techniques. Among its big achievements, the group has seen a 40% reduction in energy used in its South Africa stores since 2004.

We pause for a second. Simon knows he is in a room full of savvy business people who need to keep their bottom lines growing – even as they strive to do good in the world. With this in mind, he finishes up by demonstrating how all of the GBJ work is helping to drive Woolworths’ business performance.

Woolworths’ share price has soared from £0.75 when GBJ started in 2007, to £5 today, and that is against the falling rand! Market share is growing as Woolworths’ customer base becomes increasingly diverse, and labour turnover is down among its highly incentivised workforce.

The company’s reputation for doing good is now recognised both at home and abroad, too. Woolworths was named South Africa’s most trusted brand in 2012, 2014 and 2016 and it occupies a seat at the World Economic Forum representing business in Africa.

“We derive value from our values – whether that’s value for customers, staff, stakeholders or shareholders” – Simon Susman, Chairman, Woolworths Holdings

Everyday in search we at The MBS Group strive to present balanced shortlists – and it’s hard! We simply don’t see diverse talent coming up in businesses in the way it should. Simon reminds us all that it is possible to change the diversity paradigm, not by addressing diversity per se but by putting the right values in place and by ensuring that every decision is both about doing good and good business.  

This message certainly resonates with our other guests around the table, and indeed we hear snippets of values-led growth stories from these attendees, including Tony DeNunzio, chairman of Pets at Home – a business where the mantra is “Pets before profit”.

Fellow guest Mary Portas also speaks of how she decided to a open a knickers factory in the north of England to retrain garment workers in skills that had died out in the last generation. Meanwhile two other attendees, Telefonica’s Bridget Lea and Alibaba’s Amee Chande, are featured in this week’s Financial Times EMpower list of the 100 most influential black, Asian and minority ethnic leaders.

As we all continue to address the diversity challenge, let’s celebrate these beacons of success and integrate their learnings into our businesses.

Moira@thembsgroup.co.uk | @MoiraBenigson | @TheMBSGroup