Westpac sustainability seer Graham Paterson tells Ben Abbott that corporate responsibility is here to stay, and serious risk and HR managers would be wise to take note
But for Paterson and Westpac, the links
are clear. Australia’s largest bank, Westpac
has been a pioneer in the field following its
own singular and painful financial crisis in the
early 1990s, during which the bank lost the
faith of many of its stakeholders. The result
ing restructure heralded a sea change in the
bank’s operations, and a CSR focus that has
blossomed from a three-person contingent in
the stakeholder communications team 10
years ago to a current team of 17. “Now CSR
for Westpac is not a program – it’s really just
the way we do business,” Paterson says.
Part of Westpac’s woodwork
Westpac’s sustainability operation spans a
broad agenda of environmental, social and
governance aspects, providing advice and
consultancy across the business and identi
fying areas in which it can agitate for change.
Its ingrained nature is reflected in the ex
istence of a sustainability committee that in
volves both board and management, as well as a sustainability counsel of people from across the business. In fact,
CEO Gail Kelly is a strong advocate of the approach, and the group re
cently combined its financial and sustainability reporting for the first time.
Paterson says a highlight is its activities in the Cape York Penin
sula, where upwards of 400 employees have been able to work with
remote Aboriginal communities. Other initiatives include financial do
nations, a “matching gifts” initiative and employee engagement.
Risk and CSR
Perhaps it’s some measure of the connection between CSR and risk
management that the departments sit on the same floor in Westpac’s
Paterson says the business has a clear set of values and princi
ples, and that “if we operate anywhere across the business that is
contrary to those values, there is a risk”. He says a strong CSR com
mitment is crucial in identifying some of the less tangible risks to busi
ness that can have just as much impact as direct threats. This could
relate to corporate governance, or environmental, social and repu
He gives the example of financial education initiatives. “We’ve got
customers that have different levels of understanding of the financial
system – if they don’t understand, that gives rise to operational risks.
“In some ways a company having a very sound underlying sustain
ability approach actually takes some risks out of the way the business op
erates; by understanding what are some of those emerging risks,” he says.
A rising trend?
Though the financial crisis may have meant cutbacks to CSR pro
grams in Australia, Westpac’s has survived intact.
In many ways, the CSR agenda is being driven by Westpac’s em
ployees, with younger staff now listening to “hearts as well as minds”.
In many ways, the CSR agenda is continually being driven by
through Westpac’s employees, with the younger generation listening
to “hearts as well as minds”. As social awareness of CSR issues rises,
employees are less likely to choose employers without strong CSR
credentials. “We know there’s a war for talent going on and we com
pete for the best, and we know that this is important to them,” he says.
As social awareness rises, employees are less likely to choose
employers without CSR credentials. “We know there’s a war for tal
ent going on for the best employees, and we know this is important
to them,” he says.
The activism of shareholders and increasingly discerning cus
tomers is also critical. As transparency grows through technology
and the information explosion, Paterson says the focus on CSR will
The future then, for CSR – or bankers interested in it – is bright.
“I can’t see there will be a lessening of expectations from our stake
holder groups – longer term it’s only going to get more complex.”