2019 SOCIAL CONTRACT SUMMIT VALUE FOR ALL 5 NOVEMBER 2019 • CENTRAL HALL WESTMINSTER
THE A summit from WATER REPORT POLICY|REGULATION|COMPETITION
Supported by
CONTENTS
Contents
INTRODUCTION 2 AGENDA 3 SPEAKERS 4 BIOGRAPHIES 5-12 SPONSORS 13-17 TOPIC GUIDE 18-21
1 INTRODUCTION 2019 Social Contract Summit – Delivering Value for All Background
The water sector has embraced the challenge to provide more public value to citizens, society and the environment. How it delivers that, while simultaneously growing value for investors and ensuring bills are affordable for customers, are the questions to be answered.
The 2019 Social Contract Summit being convened by Indepen and The Water Report will provide an opportunity for decision makers across the sector to address these crucial issues and others.
The invite-only event – for senior sector leaders, politicians, regulators and stakeholders – will mark the 30th anniversary of water privatisation and consider what needs to be done to ‘reset’ the industry at this important staging post. How should the sector evolve to deliver sustainable value for all in the context of today’s circumstances and then sustain it for the 30 years to come?
The event follows Indepen and The Water Report’s inaugural ‘Defining the Social Contract Summit’, held in November 2018. A full report is available at www.2019socialcontractsummit.eventbee.com. Venue The Summit will be held at: CENTRAL HALL WESTMINSTER Storey’s Gate, Westminster, London, SW1H 9NH The nearest tube stations are Westminster station (Jubilee, Circle and District lines), St James’ Park station (Circle and District lines) or Victoria station (Victoria, Circle and District lines). Full directions are available at www.c-h-w.com/contact/location
@IndepenLtd #SocialContractSummit @TheWater_Report
2 AGENDA
1.40 Collaborating to deliver the social Agenda contract
8.30 Registration, teas and coffees Speakers: Brian Lironi, Director of Corporate Affairs, 9.15 Chair’s welcome Scottish Water Angela Smith MP, Co-Chair of the All Party Parliamentary Water Group Jon Rathjen, Water Industry Team Leader, Scottish Government 9.20 Opening keynotes Lila Thompson, Chief Executive, British Regulatory keynote – Rachel Fletcher, Chief Water Executive, Ofwat Industry keynote – Steve Mogford, Chief 2.30 Role of the active citizen and consumer Executive, United Utilities in the social contract Speakers: 9.50 Societal mega-trends: demographics, climate change, automation, digitalisation Iain McGuffog, Director of Strategy and and public trust Regulation, Bristol Water Speakers: Robert Light, Chair, CCWater Bryan Harvey, Vice President, Europe, Jacobs Rebecca Burgess, Chief Executive, City to Sea Birgitte Andersen, Chief Executive, Big Innovation Centre 3.20 Chair’s closing remarks Phil Siveter, Head of Enterprise, UK&I, Angela Smith MP, Co-Chair of the All Party Nokia Parliamentary Water Group
10.40 Break 3.25 Break 11.00 Role of investors in the social 3.40 Practitioners’ networking session contract Introduced and chaired by Bob Taylor, Chief Speakers: Executive of Portsmouth Water. John Reynolds, Chief Executive, Castle Water In this session, we will explore two practical Bill Seddon, former Chief Executive of the examples of the social contract in action. Central Finance Board of the Methodist Church ■ Making the social contract real for the Bill Galvin, Chief Executive, USS communities we serve – Colin Skellett, Chief 11.50 Legitimacy, governance and regulation: Executive, Wessex Water how do we redefine the social contract? ■ Target 100 – a commitment to, and Speakers: agreement with, customers to reduce water Isabel Kelly, Founder and Principal use to 100 litres per person per day by 2040 – Consultant, Profit with Purpose Ian McAulay, Chief Executive, Southern Water Peter Simpson, Chief Executive, Anglian Water 5.00 Political reception Pete Fox, Director of Water, Land and Biodiversity, Environment Agency Address from The Rt. Hon. Lord Deben Rachel Fletcher, Chief Executive, Ofwat (Q&A Introduced by Susan Davy, Chief Financial only) Officer, Pennon Group
12.40 Lunch 6.30 Event close
3 SPEAKERS
POLITICAL NETWORKING ADDRESS SESSION CHAIR
Bob Taylor The Rt Hon. Chief Executive, Lord Deben Portsmouth Water
SUMMIT CHAIR Angela Smith Rachel Steve MP for Penistone and Stocks- Fletcher Mogford bridge, Co-Chair of the All-Party Chief Executive, Chief Executive, Parliamentary Water Group Ofwat United Utilities
John Colin Skellett Ian McAulay Reynolds Chief Executive, Chief Executive, Chief Executive, Wessex Water Southern Water Castle Water Bill Seddon Peter former Chief Executive of the Simpson Bill Galvin Central Finance Chief Executive, Chief Executive, Board of the Anglian Water USS Methodist Church
Birgitte Andersen Brian Lironi Chief Executive, Director of Bryan Harvey Big Innovation Corporate Affairs, Vice President, Centre Scottish Water Europe, Jacobs. Iain McGuffog Isabel Kelly Jon Rathjen Director of Founder and Water Industry Strategy and Principal Team Leader, Regulation, Consultant, Profit Scottish Bristol Water with Purpose Government Pete Fox Lila Director of Water, Land and Phil Siveter Thompson Biodiversity, Head of Chief Executive, Environment Enterprise, British Water Agency UK&I, Nokia
Rebecca Susan Davy Burgess Chief Financial Chief Executive, Robert Light Offcer, Pennno City to Sea Chair, CCWater Group
4 BIOGRAPHIES
ANGELA SMITH MP for Penistone and Stocksbridge, Co-Chair of the All-Party Parliamentary Water Group
Angela Smith is MP for Penistone & Stocksbridge and in 2010 became an Assistant and Co-Chair of the All-Party Parliamentary Water Opposition. In 2011 she became Group. Shadow Deputy Leader of the House, moving in April Before entering Parliament, Angela worked in the of 2014 to the Shadow DEFRA team as the Shadow NHS, the banking sector and as a further education Minister for Water, the Marine Environment, Fisheries teacher specialising in helping youngsters who and Animal Welfare. wanted a second chance to gain academic In September 2015 she stood down from qualifications. the opposition front bench to concentrate on In 1999 she was elected to Sheffil Counci environmental issues on the EFRA Select Committee. and in 2005 was elected to Parliament for the She is also a former member of the Transport Select constituency of Sheffil Hillbruh I 21 sh Committee. In February 2019, Angela left the Labour was re-elected for the new seat of Penistone & Party to sit as an Independent MP, and in September Stocksbridge. A seat she held at the 2015 and 2017 2019, joined the Liberal Democrats. She is Co- general elections. Chair of the AGPAW and Chair of the APPG for the Chemical Industries. In 2005, Angela became PPS to Yvette Cooper
THE RT HON. LORD DEBEN
The Rt. Hon John Gummer, Lord Deben, set up the UK has ever had (1993-97). His and now runs Sancroft, a Corporate Responsibility sixteen years of top-level ministerial consultancy working with blue-chip companies experience also include Minister around the world on environmental, social and for Agriculture, Fisheries & Food, ethical issues. Lord Deben is Chairman of the Minister for London, Employment Committee on Climate Change, Valpak Limited, Minister and Paymaster General in HM Treasury. and the Personal Investment Management & He has consistently championed an identity Financial Advisers Association. He was the longest between environmental concerns and business serving Secretary of State for the Environment sense.
BOB TAYLOR Chief Executive, Portsmouth Water
Bob Taylor has 35 years’ experience of the global of Operations. Prior to this Bob was water industry and is currently Chief Executive Business Development Director with Offie o Prsot Wtr Ond b Ancal Singaporean group Sembcorp, Partners, Portsmouth Water has a 160 year history of responsible for development of the providing water services on the south coast of the municipal water and wastewater business within UK, today serving a population of around 800,000. most countries outside Asia with a specific focus on The Company has a well established reputation the Middle East, South America and India. as one of the consistently best performers in the Bob holds a B.Sc. (hons) in Civil Engineering from sector at lowest price and is about to embark on the University of Wales, Swansea, a M.Sc. in Public the first major reservoir project to be built in the UK Health Engineering from Imperial College, London since privatization. Prior to this Bob was Operations and a Masters in Business Administration from the Director – Drinking Water Services for South West University of West London. He is a Chartered Civil Water, part of the FTSE listed Pennon Group. Bob Engineer and a Director/fellow of the Institute of joined South West Water in 2016 following Pennon’s Water, a fellow of the Institution of Civil Engineers acquisition of Bournemouth Water in 2015 where he and a fellow of the Chartered Institute of Water and held the positions of Managing Director and Director Environmental Management.
5 BIOGRAPHIES
RACHEL FLETCHER Chief Executive, Ofwat
Rachel joined Ofwat as Chief Executive in January Before joining Ofwat, she spent 2018. She aims to improve the performance, 12 years at Ofgem, most recently affordability, sustainability, resilience and corporate as Senior Partner for Consumers behaviours of the water sector and to position and Competition and an executive the sector to address the strategic challenges member of the Ofgem Board. Before joining Ofgem, associated with climate change and population Rachel worked as a consultant advising on energy growth in an affordable and environmentally strategy and policy. sustainable way. As Chief Executive Rachel sits on the Ofwat Board.
STEVE MOGFORD, Chief Executive, United Utilities
Steve Mogford was appointed Chief Executive of Operating Offie ad a membe United Utilities PLC in March 2011. FTSE100 listed, of the BAE Systems plc Board. Steve United Utilities provides water and wastewater then joined Finmeccanica, Italy’s services to approximately seven million customers in principal defence and security the North West of England. company as Chief Executive of SELEX Galileo. Steve started his career at British Aerospace at its Steve is the Senior Independent Director with G4S, North West based military aircraft business. During the leading global, integrated company specialising his long career with the company he held a number in the delivery of security and related services to of senior positions before being appointed Chief customers across six continents.
COLIN SKELLETT Chief Executive, Wessex Water
Colin Skellett is a scientist and engineer by training Colin is currently Group Chief and a Fellow of the Royal Society of Chemistry. He Executive of the Wessex Water/YTL has worked largely in the water industry for over UK Group, Chair of the YTL Land and 45 years. As Chief Executive of Wessex Water, he Property UK and Chair of YTL’s UK took the company through privatisation creating hotels. He is also non-executive Chair of European a business that consistently delivers the highest Connoisseurs Travel and Chair of the Merchants’ environmental and customer service performance Academy schools. within the industry. Colin was awarded an OBE for services to He has had non-executive roles in rail, travel and business and WaterAid in the 2012 Queen’s international infrastructure businesses, served on the Birthday Honours and has an Honorary Doctorate Board of the South West Regional Development Agency in Engineering from the University of the West of and is involved with a number of charities. Colin was also England, awarded in 2015. Colin was also awarded Chair of the West of England Local Enterprise Partnership an Honorary Degree in Engineering from Bristol from 2011 until the beginning of 2016. University in February 2019.
6 BIOGRAPHIES
IAN MCAULAY Chief Executive, Southern Water
Ian was appointed CEO of Southern Water in January education, most notably at Harvard 2017, bringing more than 30 years of global water Business School. and environmental experience and a track record In a non-executive capacity, Ian operating in both publicly quoted FTSE 100/250 serves on the CBI Infrastructure Board companies and privately held enterprises. and the Greater Brighton Economic Board. He chairs He has extensive experience in the UK regulated the Greater Brighton Economic Board Infrastructure utility, construction and environmental services sectors. Panel and is a member of the CBI Infrastructure Board. He has served as an executive director of the Pennon He has also provided expert input to Government Group plc and chief executive of its subsidiary, Review Groups and Industry Partnerships regarding the Viridor, one of the UK’s largest renewable energy and UK skills agenda and development of future smarter recycling companies. In addition, he has managed regulation and environmental policy. major utility, construction and consulting businesses in Ian holds an honours degree in Civil and the UK, Belgium, India and the USA. He has enhanced Environmental Engineering and is a Chartered this practical experience with professional executive Member of the ICE and CIWEM.
JOHN REYNOLDS Chief Executive, Castle Water
John Reynolds OBE is CEO of Castle Water, the UK’s the Water Industry Commission for leading independent water retailer. Castle Water Scotland, a former director and took over the retailing responsibilities for business chair of the audit committee of the customers of Thames Water, South East Water and water market operator, MOSL, and Portsmouth Water and provides water services to a former Chair of the Church of England Ethical business customers across England and Scotland, Investment Advisory Group. He has written a number including to public sector bodies through the Crown of books and articles on business ethics and has a Commercial Service. John is a former member of MA in Theology.
PETER SIMPSON Chief Executive of Anglian Water Group
Peter has been Chief Executive of Anglian Water Peter also works with Business in the Group since October 2013, and was previously MD Community as Chair of the Water of Anglian Water from January 2010, and Chief Taskforce, and has recently joined the Operating Offie fo 2004 Board of Trustees of WaterAid. He was Chairman of Water UK from April Peter is a Chartered Water and Environmental 2012-October 2013, and is a Past President of the Manager, a Chartered Scientist and Chartered Institute of Water. Environmentalist. In 2016 he was made Peter is a member of Prince of Wales Corporate an Honorary Fellow of the Society of the Leaders Group, run by the University of Cambridge Environment and an Honorary Fellow of the Institute for Sustainability Leadership. This influences Chartered Institution of Water and Environmental at a national, EU and global level to reduce carbon Management, as well as Companion of the emissions, and to champion resource effiiny i Chartered Management Institute. He holds an water, energy and other natural resources. MBA from Warwick Business School.
7 BIOGRAPHIES
BILL GALVIN Chief Executive, USS
Bill is Group CEO of the £68bn Universities policy framework governing private Superannuation Scheme (USS), the largest private pension protection, and as a business pension scheme in the UK, which has over 400,000 strategy consultant at IBM. members and serves around 350 of the UK’s Bill is a governor of the Pensions Policy Institute universities and higher education institutions. and has previously sat on the PLSA’s Defined Benefit Bill is the former CEO and executive director for Council. He has been a non-executive director at strategy at the Pensions Regulator. He has also the Solicitors Regulation Authority and the Pensions worked at the DWP, where he was responsible for the Advisory Service.
BILL SEDDON Former Chief Executive of the Central Finance Board of the Methodist Church
Until the end of 2016, Bill was Chief Executive of both England Pensions Board, the Methodist the Central Finance Board of the Methodist Church Church Lay Employees Pension (CFB), the fund manager of the Methodist Church Scheme and the William Leech in Great Britain and its wholly owned subsidiary, Foundation; a member of the Amity Epworth Investment Management, a specialist Funds Investment Panel and the Clergy Support Trust ethical fund manager. Under his leadership, funds Investment Committee; a member of the Church of under management grew from £250 million to £1.3 England General Synod House of Laity. billion and the CFB developed its reputation for Past experience includes: Chair of the Church aligning investment portfolios with the position of the Investors Group; Treasurer of the Institutional Methodist Church on a variety of social justice issues. Investors Group on Climate Change; member of He was also responsible for establishing Epworth and the Methodist Church Joint Advisory Committee on the Affimtv commn ivsmn ad deposi the Ethics of Investment and the Joseph Rowntree funds, which it manages. Charitable Trust Investment Committee; a trustee His current roles include: Chair of the Dominion of the EIRIS Foundation and director of the Ethical Insurance Co Ltd; trustee director of the Church of Investment Research Services (EIRIS).
BIRGITTE ANDERSEN Chief Executive, Big Innovation Centre
Professor Birgitte Andersen (PhD Economics) is University of London (Birkbeck), where CEO of Big Innovation Centre, a London based she holds the title Professor of Economics think-tank and innovation hub that promotes open and Management of Innovation. innovation and develop best-practice prototypes She advises economists and policy makers of via challenge-led taskforces, innovation-ecosystem national governments in and beyond Europe analytics, and All Party groups in the UK Parliament including OECD, UN and WIPO; and large firms, on Artificial Intelligence and Blockchain. Since 2011, and serves as an expert defence witness in the UK she has rapidly - through a strong vision – directed courts on matters of IP use on the Internet. She was and grown the Big Innovation Centre to become a the Rapporteur for the EU Commission representing building block in the innovation landscape in the UK the EU Expert Group on Knowledge Transfer and and European Union. Big Innovation Centre has just Open Innovation, and currently sits on the EU Expert opened offie i te Midde Es (ia ad Dubai) Advisory Panel for Horizon 2020 - Societal Challenge: She is called in by the media (e.g. BBC, Al Jazeera, Europe in a Changing World – Inclusive, Innovative SKY), and her work is published in renowned journals, and Reflective Societies. Birgitte was recently and highlighted in government reports. During the (October 2018) appointed on Arab League Expert internet boom, Birgitte launched and ran (2000- Group on Digital Transformation regarding the Digital 2010) probably the UK’s biggest interdisciplinary Government Strategy for the Arab World. postgraduate programmes on E-Commerce at Twitter @BirgitteBIC
8 BIOGRAPHIES
BRIAN LIRONI Director of Corporate Affairs, Scottish Water
Brian was appointed Director of Corporate Affairs at and other stakeholders. He has also Scottish Water in August 2016 with responsibility for led work with sector stakeholders on leading on communications and engagement with a Scottish Water strategy to support a external stakeholders. Flourishing Scotland. He has led on the creation of an ambitious Water Prior to working at Scottish Water, Brian was Sector Vision with the Scottish Government, Water Head of Corporate Affairs at Scottish and Southern Industry Commission for Scotland, Customer Forum Electricity Networks, part of SSE Plc.
BRYAN HARVEY Vice President, Europe, Jacobs
Bryan Harvey is a vice-president within Jacobs’ leader, Bryan has worked and held European business with nearly three decades of leadership positions across the world, experience built from his career solving clients’ with particular focus on Europe, Asia greatest challenges. Working alongside Jacobs’ Pacific and North America. wide ranging team of professionals, Bryan explores Bryan holds a Master of Engineering degree (in Civil solutions rich in innovation to enhance service Engineering) and a Master of Business Administration delivery to clients and communities around the degree (in Global Entrepreneurship) from The London world. A Chartered Civil Engineer and business School of Economics and Political Science (LSE).
IAIN MCGUFFOG Director of Strategy and Regulation, Bristol Water
Iain McGuffog has been Director of Strategy & 2015 joined Ofwat as Director, Strate- Regulation at Bristol Water since October 2017 and gy & Planning, working on topics such has worked in the water sector since 2002. Iain is a as the Strategic Policy Statement and management accountant and economist whose residential retail review. At Bristol Water early career was in the rail, consumer electronics Iain has led the development of the “Bristol Water… and chemicals industries. From 2002 to 2015 Iain Clearly” long-term strategy, the PR19 plan and worked in a number of roles at South West Water, Bristol Water’s social contract. Most importantly he is ending up as Chief Economist. During his time there responsible for water quality. He strongly believes in he worked on three price reviews and delivered a recycling, mostly ideas, and connecting seemingly wide range of tariff, market and regulatory topics. In random topics together.
9 BIOGRAPHIES
ISABEL KELLY Founder and Principal Consultant, Profit with Purpose
Isabel Kelly is the Founder & Principal Consultant at the Said Business School, Oxford Profit with Purpose, a social purpose consultancy University, where she conducted working with companies globally. research on the organisational Her first consulting client in 2015 was software structures being used by businesses company Sage Group and she currently works with to deliver social impact. small and large companies in the financial services, In 2002 CEO & Founder of Salesforce.com, robotics, fintech, recruitment, hospitality, and luxury Marc Benioff, hired Isabel to establish the goods industries. Salesforce.com Foundation internationally, Isabel develops social impact strategy including including implementing an innovative revenue- vision, brand, governance and programmes, generation model. evaluation and metrics. She helps all her clients Isabel was at Oxfam and Amnesty International for to make use of innovative technology to track, 12 years prior to joining Salesforce. measure and report their social impact. She is a non-executive director at tech company In September 2015 she became a Resident Expert The Panoply, and is on the Board of NESsT, a social at the Skoll Centre for Social Entrepreneurship at enterprise.
JON RATHJEN Water Industry Team Leader, Scottish Government
Jon Rathjen is the team leader of the Water Industry Servant having worked for Customs Team in the Scottish Government with policy and Excise and now the Scottish responsibility for the Scottish Water Industry including Government. With experience in sponsorship of the public corporation Scottish Water front line service delivery and then and the new Hydro Nation agenda. Scotland the with policy responsibilities from IT security through to Hydro Nation focuses on the economic, social and Better Public Service Delivery and e-Government, environmental development of the value of water Sustainable Development, and now the Water resources in Scotland and the raising of Scotland’s Industry. international profile through its performance on Jon is a board member of Aqua Publica Europea, global water issues. UK Water Partnership, UNESCO Centre for Water Law, Jon has over 25 years experience as a Public Policy and Science.
LILA THOMPSON Chief Executive, British Water
Lila is responsible for British Water’s strategic direction Lila has over 20 years of experience and for supporting the UK water industry supply in supporting business growth, policy chain. Lila was formerly responsible for the delivery of development and stakeholder British Water’s international services which included engagement in a number of industry leading scoping and business development visits supply chains and sits on a number of working to a wide range of markets including Saudi Arabia, groups on behalf of the water industry. Lila will be Libya, Morocco, Russia, Romania, Bulgaria, China sharing how the supply chain could add value to and India to help companies grow their business the development and implementation of social overseas. contracts.
10 BIOGRAPHIES
PETE FOX Director of Water, Land and Biodiversity, Environment Agency
Pete has worked in the Environment Agency and wildlife conservation. Now in a predecessors for over 20 years in a wide range senior leadership position, Director of regulatory, technical and leadership roles Water, Land and Biodiversity, including climate change, waste regulation, he is responsible for leading on biodiversity and flood risk management. Previous work on water quality, water quantity, farming, to this he worked in the voluntary sector, in contaminated land, wildlife and fisheries.
PHIL SIVETER Head of Enterprise, UK&I, Nokia
Philip Siveter currently runs the UK&I Enterprise division where he held numerous leadership for Nokia. He joined Nokia in 2017 bringing 20 years roles. Philip has strong experience of of leadership experience in telecoms and ICT to the Public Sector & Enterprise markets, role. Philip is executing a strategy to drive Nokia’s working with customers and partners world class portfolio into the Enterprise market and is in delivering critical services. He has also held sales also responsible for Nokia’s partners and alliances in and operation positions at Sirocom, Nortel & Energis. the UK&I. Philip has been an advisor for the Beyond Boyle Previously Philip has worked for Ciena, where he foundation and Social Enterprise for Berkshire, and is a set up a Public Sector business, and before that BT keen advocate of the social enterprise model.
REBECCA BURGESS Chief Executive, City to Sea
Rebecca is CEO of City to Sea, an award- and specifically providing them winning not-for-profit organisation campaigning with the evidence base for the now to stop plastic pollution - from city to sea. passed Single-Use Plastics Directive, Rebecca joined in April 2018 as Head of that Rebecca felt inspired to do more Partnerships, to manage the growing network in the fight against single-use plastic. Rebecca of businesses. After a few busy months she was took the plunge to work freelance in 2016 when appointed to the board as Commercial Director she first moved to Bristol, after 10 years shaping and naturally stepped into the role as Chief sector leading community programmes with a Executive as of December. variety of companies and not-for-profits. She is an Prior to City to Sea, Rebecca worked at accomplished and commercially savvy individual, consultancy Eunomia. It was through working with who is truly passionate about helping businesses the European Commission on their Plastic Strategy balance profit and purpose.
11 BIOGRAPHIES
ROBERT LIGHT Chair, CCWater
Rob was appointed as CCWater Chair in June from 2000 to 2018. He was Council 2019 by Defra and Welsh Government. Rob has Leader from 2006 to 2009 and was championed the interests of consumers as our the first Chair of the Leeds City Northern Chair for the past four years. Region. He also served on the Board Rob is Chair of the Independent Commission of the Audit Commission from 2011 to 2015 and on Civil Aviation Noise (ICCAN). He served as a the Environment Agency from 2009 to 2015 where he councillor on Kirklees Council from 1987 to 1995 and was Deputy Chair from 2012 to 2015.
SUSAN DAVY Chief Financial Offie, PennonGroup
Prior to her current appointment Susan was Finance of Finance (Wastewater) at Yorkshire Director at South West Water between 2007 and Water. A graduate qualified chartered 2015, during which time she was responsible for the accountant, Susan is Chair of the CBI company’s Business Plan to 2020. She has also held South West, Non Executive Director and a number of other senior finance roles in the water Audit Chair of Restore Plc and a member of the A4S sector, including as Head of Regulation and Head (Accounting for Sustainability) CFO leadership network.
12 SPONSORS
ANGLIAN WATER
Anglian Water supplies drinking water to 4.3 million customers across the East of England and collects and treats used water from over 6 million people. We operate within the largest geographical region of England and Wales. Water is our business. It’s our job to handle it with we believe it’s everyone’s responsibility to look care and balance the needs of our customers with after it. We’re constantly discovering new ways to those of the environment around us. keep ahead of a changing world, by planning for Our ethos is ‘Love Every Drop’, because it’s the future, and exploring new ideas to meet our what we do. Every drop of water is precious and customers’ individual needs today and tomorrow.
ARUP
The successful design, development and maintenance of our water infrastructure requires the integration of many disciplines. Arup’s water team has wide-ranging skills spanning advisory and specialist technical services. We apply them on every kind of project, from flood risk management immediate financial. All of the three main aspects of integrated water management – supply, wastewater and water resource planning, to dam engineering, and flooding – connect to economic, social and treatment works design and river engineering. natural capitals. Building a shared appreciation of As our most valuable resource, the social impacts this can underpin new collaborations and innovative, of water development decisions are of paramount sustainable solutions. importance. We are proud to work with clients and Arup also conducts considerable research into partners to help deliver societal good, securing how water can be better managed. Climate long-term sustainability and resilience. Our efforts change is causing both flooding and droughts in are drawn towards helping demonstrate the wider different parts of the world, so it’s vital to be able to value that capital investments can offer, beyond the predict and respond to these changing dynamics.
ATKINS
Atkins business is one of the world’s most respected design, engineering and project management consultancies. As a global fully integrated professional services and project management company, we help our clients plan, design and enable critical infrastructure projects, and provide expert consultancy that covers the full project lifecycle. Our breadth of management and performance and providing a capability is the core of our strength and we bring better service to customers, we provide solutions that our global expertise together to deliver solutions to utilise the latest digital technologies, supported by local challenges, putting resilience, sustainability and our market leading consultancy services to deliver productivity at the core of everything we do. real added value at all stages of the value chain. Drawing on our diverse global expertise in the Focusing on our client needs and complex industry water sector we focus on delivering faster, smarter challenges has led us to take a systems approach and more reliable outcomes for our clients. With and collaborate with partners to develop a series of a detailed understanding of the key challenges service line value propositions that are designed to facing the industry around leakages, improving asset deliver better customer outcomes.
13 SPONSORS
BRISTOL WATER
Bristol Water has been providing an essential public water service to the communities within and surrounding the city of Bristol since 1846. We were established by an Act of Parliament as a privately financed water company with a strong social purpose to improve public health by the be accountable for its social purpose to “have a provision of a clean and affordable supply of water positive impact on the lives of our customers, our to all, and not just those who could afford it. communities, our colleagues and the environment, Today Bristol Water serves a population of 1.2m beyond the delivery of pure and reliable water”. people in South Gloucestershire, Somerset, Wiltshire Bristol Water is building partnerships with a wide and the City of Bristol. range of local and national organisations on In January 2019 Bristol Water became the first initiatives linked to the social contract. The work with utility to publish a social contract, “Bristol Water For City to Sea on the “Bristol Refill” campaign is one All”, which set out how the Bristol Water Board will example of the approach.
CASTLE WATER
Castle Water is the UK’s leading independent water supplier. We deliver water and wastewater services to hundreds of thousands of businesses, charities and public bodies nationwide. A trusted supplier, we offer transparent, fair pricing with the high standard of care business customers ensure children get the safe, clean drinking water need. Committed to delivering value, and with no they need to survive. Since we partnered in 2017, ties to water network owners, we campaign for lower Save the Children’s Emergency Fund has responded costs. Sustainability is vital, so we also help businesses to 138 emergencies and delivered lifesaving aid to use only what they need by providing free water 2.2 million children and their families. saving advice and services to maximise efficiency At Castle Water, we’re defining the business of We’re clear on our corporate responsibilities. We water. We’ll continue to offer customers choice, invest in our community, making a positive difference fair prices and responsive services while working on matters of health and wellbeing, education and together to deliver positive outcomes for society and training, employment and the economy. the environment wherever we can. Water is life. Castle Water and Save the Children Find out more: www.CastleWater.co.uk
14 SPONSORS
JACOBS
Jacobs (www.jacobs.com) leads the global professional services sector delivering solutions for a more connected, sustainable world. With a real social value. With our diversity of skills and depth global talent force of more than 77,000 people, of knowledge and experience, we are helping to Jacobs provides a full spectrum of services tackle these challenges and find better ways to including scientific, technical, professional and deliver complex, sustainable solutions that shape construction and programme management for the world we live in. Having made a long term business, industrial, commercial, government and commitment to invest and grow in the UK, we have infrastructure sectors. grown to more than 10,000 people across the UK and Increasingly, our clients are focusing on how best are helping to build an internationally competitive to connect communities, build resilient infrastructure, skills base, bringing opportunities for innovation and safeguard people and the environment, and deliver collaboration into the regions where we work.
PORTSMOUTH WATER
At Portsmouth Water we have been supplying water to Portsmouth and the surrounding area since 1857. The area supplied by the Company extends through South East Hampshire and West Sussex from the River Meon in the West to the river Arun in the East, encompassing 868sq. kilometers. We provide high quality public water supplies to a domestic population exceeding 698,000, as boreholes, and surface water sources. well as many important industries, large defence establishments and varied commercial businesses. Our Company has a proud record of maintaining We have a long tradition of providing safe drinking high standards of customer service whilst having the water of the highest quality from its springs, wells, lowest water supply charges in England and Wales.
SCOTTISH WATER
Scottish Water delivers vital water and waste water services which are essential to the daily lives of 2.54 million households and 152,000 business premises to support a flourishing Scotland. We are trusted to care for the water on which Scotland depends and are proud of the service we provide: ■ delivering 1.46 billion litres of clear, fresh drinking one of the lowest in Great Britain. water and; We provide high quality clear, fresh, great-tasting ■ removing 996 million litres of waste water which we drinking water and continue to invest in managing treat, recover resources from and return safely to the our assets to deliver further improvements to environment. drinking water quality, protect the environment and One of the UK’s top performing water companies, contribute to the Scottish economy. we provide customers with high levels of service To find out more about Scottish Water and our and continue to build an increasingly sustainable services, visit www.scottishwater.co.uk and follow us business. Our average household charge remains on Facebook, Twitter and LinkedIn.
15 SPONSORS
SOUTHERN WATER
Southern Water is one of the largest water and wastewater companies in the South East of England. It supplies 532 million litres of drinking water every day to more than two million customers and treats and recycles 717 million litres of wastewater for more than four million customers in Kent, Sussex, Hampshire and the Isle of Wight. Water is essential to every aspect of our lives – for Southern Water is committed to creating a resilient drinking, cooking and cleaning. Yet the South East’s water future for the South East, and providing water water supply faces big challenges. The population for life to enhance health and wellbeing, protect and of the region is growing fast, and climate change improve the environment and sustain the economy. will bring droughts and more extreme weather. This Find out more about Southern Water: means greater demand and less water to go around. www.southernwater.co.uk
SOUTH WEST WATER
As one of the largest environmental infrastructure groups in the UK, Pennon is at the top end of the FTSE 250, with assets of around £6.5 billion and a workforce of around 5,000 people across its water and waste business; South West Water, Bournemouth Water, Pennon Water Services and Viridor. South West Water is the water and wastewater service provider for a population of c. 1.7 million in We believe that by investing in the future of our Cornwall, Devon, and parts of Somerset and Dorset. region, we are not only improving the quality of life Since 2016 it has also been providing water services for today’s residents and visitors but are also taking in the Bournemouth Water region to a population responsibility for future generations. Our aim is to of c. 0.5 million. We provide reliable, effiin an continually drive up standards, particularly in the high quality drinking water and waste water services areas that matter most to our customers and be throughout these areas. amongst the best in the water industry.
16 SPONSORS
UNITED UTILITIES
United Utilities is the UK’s largest listed water and wastewater company. Our purpose is to provide great service to customers and communities in the North West of England, creating long-term value for all of our stakeholders. We keep the taps flowing and the toilets flushing for seven million people and 200,000 businesses across the region, bringing clean, safe water into your home as having the most embedded culture of innovation and then taking your used water away again to treat in the sector. it and return it safely to the environment. We’re always finding new and better ways to serve We are proud to be leading the industry across a our region’s diverse population, adapting our service host of measures, from our high quality approach to based on customers’ needs and for those who need customer engagement and sector-leading initiatives help the most, while making sure water sources and on affordability issues, to being highlighted by Ofwat services are fit for future generations.
WESSEX WATER
Wessex Water is a regional water and sewerage business serving 2.8 million customers across the south west of England including Dorset, Somerset, Bristol, most of Wiltshire and parts of Gloucestershire partnership approach. Customers benefit by way and Hampshire. After significant investment in water of better outcomes, and share in outperformance and sewerage infrastructure, Wessex is now regarded through the establishment of a community foundation. All of this is incorporated within the as having world leading water quality, environmental “Wessex Water community commitment”; a new standards and customer service. model for water services. Wessex Water is transforming its business model, Launched at the end of April this year, the ‘Open away from the monopoly water utility towards System’ hub known as Wessex Water Marketplace becoming a facilitator of markets across the wider is already requesting solutions to challenges faced water system. Wessex Water believes this new model over the coming AMP. The concept being that the for the UK water industry will pave the way for a Marketplace facilitates engagement with the market progressive approach, synergizing customers and to understand if there are alternative approaches to communities, the environment, the network and our traditional more asset focused route that deliver processes, all tied in with the circular economy in a better value.
17 TOPIC GUIDE Social contracting in the water sector Essential services providers have material politicians, investors and those representing effects on many aspects of society as well social and environmental interests to as on their customers. More than most explore how to pave a constructive and businesses, they should pay attention to effective way forward and address the gaining and sustaining acceptance of the fundamental question: how can private impact of their business on the economy, companies providing essential public the environment, communities and society services deliver better outcomes for society? generally. This is in addition to keeping their customers and investors happy. The Participants considered how a ‘social consequences of doing all this well will be contract’ between essential service legitimacy, consent, and trust, attributes monopolies and their investors on one hand, which in the case of companies providing and customers and communities on the essential services, such as water, energy other, might make a meaningful contribution and transport, have suffered knocks in the to rebuilding trust and improving outcomes last few years. in essential services industries.
This was the context for the ‘Defining One year on, the water sector has built the Social Contract’ Summit co-hosted momentum on the social purpose agenda. by Indepen and The Water Report last November. The Summit brought together ■ In January, Bristol Water became the senior business leaders, regulators, first company to launch a social contract.
Photo: business broadcaster, Steph McGovern, chairing the 2018 Social Contract Summit
18 TOPIC GUIDE
It reflects Bristol Water’s corporate between a company and the society in purpose to have a positive impact on which it operates. The idea underlying society beyond the delivery of clean and it is that in return for being allowed to reliable water supplies. It seeks to deliver operate and the chance of making a societal benefits and a way for local profit for shareholders, a company must people to hold the company to account. discharge a set of obligations to society If local people do not see the benefits, defined more widely than its paying there are financial consequences for the customers. company. The point of a social contract is to align ■ In April, Water UK announced a Public a company’s corporate purpose with Interest Commitment to coordinate effort its social purpose. This is close to the at a national level to put public interest concept, popular in the noughties, of the at the top of the agenda, in a way that licence to operate, the essential feature of complements companies’ individual which was that it was granted by society business plans. The Commitment includes and had to be earned and maintained – it pledges on reducing leakage, tackling was not an entitlement. non-affordability, reducing carbon emissions, preventing plastic bottle waste Recent developments and achieving 100% commitment to the Government’s Social Mobility Pledge. Current interest by companies in the social contract and related concepts is a ■ In October, Ofwat published its new response to the view that an undesirable strategy, which includes a strategic goal for gap has appeared between the corporate water companies to serve a wider public purpose of companies and their social purpose, delivering more for customers, purpose and that the gap seems to be society and the environment. getting wider. Some see the causes of this Nevertheless, there remains a way to as being the changes in patterns of share go to before we see social contracts ownership and the shift away from quoted that other parties would recognise as to unquoted or private equity. Concerns such and be happy to sign. There is also about the gap and its effects are various, work still to be done to build industry often highlighting: consensus on what the contract is ■ dividends, gearing and executive pay and what distinguishes it from other arrangements in terms of what it is being too high seeking to deliver. These are questions ■ investment, performance, innovation and that we will address at the 2019 tax paid being too low. Summit. Ahead of the event, this guide provides some early reflections based on The criticisms are not exclusive to the discussions we have had with industry essential services sectors, such as water, leaders about the social contract and its but arguably they are most prevalent in relevance to the water sector. these regulated sectors. In Ofwat’s view, Not a new concept a social contract is a quid pro quo in the context of granting a monopoly licence to The social contract, as a concept, has provide essential services. The fact that been around for a long time, being widely customers have no choice but to use and promoted in the 17th and 18th centuries pay for essential services from monopoly by Hobbes, Rousseau and others. More providers implies an additional obligation recently, the term social contract has to society on those who are granted the found an application in the relationship licence.
19 TOPIC GUIDE
Distinctive features of a underlies this range of benefits stems from the circular element of the social social contract contract. Efficiency is gained where each The table below distinguishes a social party to the social contract optimises its contract from a regulatory contract and contribution to the solution. Observable from the Corporate Social Responsibility examples of this are where demand (CSR) activities of a company. side response is the optimal solution to capacity problems in energy or in The key benefit of the social contract wastewater networks. is that the services, as well as creating From the shareholder perspective, activities private value, have sustainable public provided under commercial and social value in the form of positive effects on the contracts together with CSR and charitable economy, the environment or society. activities can create an investable Opportunity to create value proposition that is sustainable in the long-term and can help essential service The creation of the economic value which providers re-establish their reputation.
Regulatory contract Social contract CSR Nature Licence Binding agreement Instigated by company, possibly Contract in form of a Willingly entered by the with partners price determination parties Short term Negotiated between the parties Parties Company and Ofwat Company and Company • customer Employees • community Other organisations • representative body Terms Company provides Company provides service Case by case service Counterparty provides Customers pay service regulated price for Net settlement service Enforcement Licence enforceable by In principle enforceable Often informal Ofwat by the parties Determinations referable by company Objective Create private value Create private and public Reputational value to customers and value to the parties and to the business shareholders society over the long term Value to Optimise provision by beneficiaries each side playing its part in delivering outcomes Mechanisms Financial and Mutual benefit Charitable reputational incentives Voluntary
20 TOPIC GUIDE
Developments in technology, the economy and the environment all suggest greater WATER INDUSTRY scope than in the past for circular EXAMPLES OF VALUE economic activity of the kind inherent in a social contract as we have defined it. CREATION THROUGH Role of customers SOCIAL CONTRACTING In the water industry there are Compared to the role they play today, customers have an enhanced role in the significant opportunities for circular social contract. We are seeing consumers or social contracting arrangements evolving into prosumers, and in some involving customer action to reduce cases playing an active role as co- the cost of services. developers of collaborative solutions. As technology develops, this is happening Examples in wastewater include increasingly in B2C as well as B2B better utilisation of sewer assets transactions. if customers limit the extent of surface water drainage into the There are precedents in energy, where sewers and do not use the sewers consumers generate energy and sell any for disposal of material that causes excess to the grid. There are numerous blockages. pilots in the sector to look at how blockchain technology can assist peer In clean water, a B2B example is to peer trading, enabling customers to for water companies to contract buy and sell energy from each other, with farmers to deliver nitrogen with the associated benefit of significant cost reductions and improved network reductions in catchments at efficiency. significantly lower cost than a conventional asset solution. The onset of more open markets and business models, bigger and better data and technology driven changes will provide services, such as finance, we have only opportunities for consumers to play ever recently begun to gauge the economic, more active roles. The crucial enabling security, social and human implications. factor for this to happen is engagement. The 2019 Social Contract To make a success of social contracting a company will have to do two difficult things. Summit
■ First, be better at finding out what There is still plenty to debate and decide customers want and what issues about the about the purpose and form of social services are of concern to them. contracting in the water sector, and what it means for existing arrangements, including ■ Second, create better relationships with regulation, if the great opportunities are to customers so as to bring the voice of the be realised. customer to bear on how issues of mutual concern and benefit are addressed. Through the 2019 Summit, our main objective will be to address these critical Social contracting is not easy. It entails a radical change in the balance of power questions and in doing so, to ensure that once customers begin working to add value the social contract makes a practical as well as the company. Even in areas that contribution to the sector and delivers the are much more advanced than essential ‘reset’ that many think is needed.
21 The 2019 Social Contract Summit is brought to you in association with our sponsors
@IndepenLtd #SocialContractSummit @TheWater_Report
THE A summit from WATER REPORT POLICY|REGULATION|COMPETITION