Lucy Neville-Rolfe: Corporate and Legal Affairs Director, Tesco PLC

MMR,  Oct 29, 2007  

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CHESHUNT, England -- Tesco PLC has won increasing worldwide recognition as one of the most successful and fastest-growing retailers in the world. But it is also gaining attention for its corporate social responsibility program--a program that is breathtaking in the scope of its activities, the ambitiousness of its goals and the rigorous metrics by which its initiatives are monitored and evaluated.

At Tesco corporate social responsibility, or CSR, is not mere window dressing intended to mollify vocal tree huggers; it is, rather, a serious response to the desires of the company's customers. As chief executive officer Sir Terry Leahy explains in the introduction to the 2007 edition of Tesco's Corporate Responsibility Review, "They want businesses--including supermarkets--to be good neighbors in the communities they serve. And they want to be assured that businesses are responsible, fair and honest."

Responsibility for Tesco's CSR program--and credit for the importance it has come to assume--belongs to Lucy Neville-Rolfe, director of corporate and legal affairs, and chairwoman of the Corporate Social Responsibility Committee, a cross-functional group of senior executives drawn from across the company.

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Neville-Rolfe joined Tesco in 1997 and served as corporate secretary from 2004 to 2006, when she was elected to Tesco's executive board. She is deputy chair of the British Retail Consortium and a member of the China Britain Business Council, as well as a member of the Corporate Leaders Group on Climate Change.

This year Tesco's CSR activities involved a wide range of issues and activities, including climate change, sustainable consumption, packaging and recycling, health and nutrition, ethical trade, charity, and local sourcing and agriculture. That does not exhaust the list, nor reveal the depth of involvement. But perhaps equally striking is the serious commitment to integrating corporate responsibility throughout Tesco's business.

For several years Tesco's management has used a graphic device it calls the Steering Wheel to represent its strategic goals across four main divisions of the business: customer, people, operations and finance. Progress toward achievement of the objectives in each area is measured by a set of key performance indicators (KPIs), and progress is reported to the board every quarter.

Last year, however, a new segment was added to the Steering Wheel: community. The addition coincided with the launch of Tesco's first Community Plan and, as well, Neville-Rolfe's election to the board. That promotion, she feels, was in part a recognition of the value of the CSR work that she has done so much to advance.

When she arrived at Tesco in 1997 community affairs were far more limited in scope and much lower in profile. The first community initiative, she recalls, was giving computer equipment to schools. "It was important because computers were very expensive in those days and schools didn't have them," she recalls. "So that linked us with the community for the first time, and that was our first major involvement in CSR."

That single initiative has grown over the years, with computer hardware and software worth 100 [pounds sterling] million ($204.5 million) being donated. The approach has been extended recently, moreover, to sports equipment in an effort to promote more healthful living by encouraging children to be active.

About five years ago Neville-Rolfe initiated reporting on corporate social responsibility. The addition of the community plan to the Steering Wheel in 2006 was, she says, the subject of debate among members of the executive board. Some felt that it should simply be subsumed under the customer segment of the wheel because the biggest focus of Tesco's community work is, after all, on its customers.

Neville-Rolfe, though, argued for its separate representation. "I felt it would be emblematic to make it a separate section of the wheel," she says.

The 16 other members of the committee that oversees Tesco's CSR activities are chosen carefully. "Partly what we've done is select people who can make a difference," Neville-Rolfe explains. "And that is a matter of individuals but also of areas. For example, ethical trading is very important, so we've got the international trading law and technical director. Training, opportunity and the ability to get on are also very important, so we have the human resources director."

The geographical scope of CSR and the community plan are expanding to Tesco's international markets, and the committee makeup reflects this, counting the chief executive for Central Europe, Noel Robbins, and the corporate and government director of Tesco China, Nanbin Zhuang, among its ranks.

While the extent of CSR activities is impressive, there are a few key issues that are of primary concern and are consequently receiving not only attention but significant investment. Climate change heads the list.