Stakeholder Engagement and Materiality
Stakeholder Engagement Approach
Our process to understand key stakeholder issues and identify our priorities follows 8 steps, which we conduct annually as part of the reporting process:
- Management and peer review of key stakeholders
- Online and offline interviews of key stakeholders
- MCI research of trends affecting our business
- Review of third party research to understand global mega trends
- Internal Risk Assessment conducted by the MCI Finance Team
- Assessment of all identified issues and prioritization of key issues for focus within our strategy by the Sustainability Team
- Executive management review, discussion, feedback and approval
- Presentation to key stakeholders for review
Our management team identifies our primary stakeholders as those who have a significant interest in the actions and views of the company and whose actions and views are, in turn, of significant interest to us. We validate our identified stakeholder groups through comparison with our industry peers.
Our stakeholders are clients, talents, suppliers, the meetings industry, shareholders, the community, media, NGOs, governments and regulators.
Analysing Stakeholder Issues
Our stakeholder engagement process focuses on five key stakeholder groups (clients, talents, suppliers, the meetings industry and the community) that we carry out through various formal and informal methods.
- Online Sustainability Survey of 351 employees
- Online Sustainability survey of 55 key suppliers and partners
- Online Talent Satisfaction Survey 904 talents (49% of all MCI talents)
- 1,360 evaluations between employees and their managers during their annual appraisal
- Online Sustainability Survey of 20 key corporate and institutional clients
- Face-to-face interaction with clients, suppliers and meetings industry partners in 112 industry sustainability events led or facilitated by MCI management in 2016
- Face-to-face project meetings
Their input provides critical feedback that is used to help develop our sustainability strategy and this report. After the results of the survey are produced they are shared with the respective stakeholders, and further input solicited. We engage with our Media and Government stakeholders on an adhoc basis throughout the year. Our shareholders are addressed through the management team and the advisory board.
We define issues that are material to MCI as those that:
- Have or may have a significant impact on the company’s finances or operations.
- Have or may have significant impact on the environment or society, now or in the future.
- Can substantially influence the assessments, decisions and actions of our stakeholders and shareholders.
Our research identified the following key issues and opportunities:
Assessment of trends, material issues and opportunities
Impacts of Our Business
With the size and global scale of MCI, there are significant indirect and direct impacts of our business.
- Our 2016 revenue and direct financial impact was almost €406 Million.
- Not only do the events we organise generate revenue for MCI and tax for the governments where we operate, but they also provide a return on investment for our clients while generating indirect income for local businesses. This income helps to create jobs, drive tourism and even accelerate innovation and economic development. In the United States, the meetings industry directly supports 1.7 million jobs, $263 billion in spending, a $106 billion contribution to GDP, $60 billion in labor revenue, $14.3 billion in federal tax revenue and $11.3 billion in state and local tax revenue (Source: EIC). The UK meetings industry delivers £58.4 billion of UK’s gross domestic product (GDP) – making it the 17thlargest industry in the UK, three times more than the agriculture industry. It generates more than one million full-time equivalent jobs, and makes a direct contribution of £20.6 billion to the tax system (Source: MPI).
- We have not conducted an exhaustive indirect economic impact analysis yet, however as a rough calculation we can take industry data for average daily event spend from economic studies completed in Denmark, Australia or the UK. Then if we assume that our delegates spend a minimum of 406€ per day and that our average event lasts 3 days then this would be an indirect impact of over 1,800 Billion Euros!
- In 2016 we organised over 5,500 live experiences & communication activities across 80 countries, convening 1.5 million participants. Events are highly resource-intensive and can have both positive and negative environmental consequences for the host city and population.
- Our key direct environmental impact is the energy used to power our offices and the carbon emissions from this energy usage and the flights we take.
- Indirectly, if we include our client events in our total footprint then our key impacts are Carbon Emissions, transportation, air pollution, waste, water, food and beverage and materials usage (paper and materials to build brand displays and stands).
- We calculate that our indirect carbon emissions are 99% of our total emissions which together equal over 435,900 tons of CO2e. That is equivalent to the average emissions of a small town of 240,000 people in India.
- Events bring people together and by their very nature have an impact on our talents, our suppliers, attendees and the communities where we operate. Our key social aspects include labour practices, human rights, occupational health and safety, training and education, community citizenship and investment, communication and legacy.
- We believe that by engaging and supporting local communities and international sustainability causes we can leave a positive legacy through education, workshops and collaborations. Looking deeper into local economies, employing local talent, choosing local suppliers and adding a community element in support of local needs will also have a positive impact.
- Since 2010 MCI talents have raised over 1.7 million Euros for community projects. More info
- In 2016, MCI had an indirect contribution of over €3.9 million in pro-bono event management and through the fundraising dinners we organise for our clients.
Global Mega Trends
Today’s global business environment is more complex, uncertain, volatile and dynamic than ever. Sustainability is one of the key challenges facing the global economy. We see several mega trends that will significantly affect our clients, our business and the meeting industry over the next decades.
These six mega trends are inextricably interconnected and interdependent:
Climate Change & Degradation
Unsustainable consumption: 85% of ocean fisheries are over-exploited
Failing ecosystems: 13 million hectares of forest lost annually between 2000 and 2010
Water scarcity: 3x increase in water withdrawals in 50 years. 700 million people face water scarcity today. By 2025, two-thirds of the world’s population may face water shortages
Waste: Over a third of all food produced gets wasted
Hybrid Meetings: Projected to account for over 10% of all meetings in 2016
Digital Age: Facebook – 1.9 billion users, Twitter – 310 million active users, Snapchat – 7 billion video views daily
Mobile Growth: By 2020, 90% of the world’s population over 6 will have a mobile phone and by 2017 over a third will own a smartphone
Health & Safety
Security & safety: Acts of terrorism and increased media exposure are driving stricter security requirements in destinations and events
Wellness of staff and clients
Openness and disclosure: 95% of the 250 biggest companies report their sustainability performance
Stricter national anti-corruption laws: i.e. U.S. FCPA, U.K. Bribery Act, Brazil, China and at least 26 other countries
Push for Transparency: All EU companies with over 500 employees must include sustainability in their annual reporting by 2017
Growth industry codes of conduct: i.e. Health Care
Population Growth: 7.5 Billion rising to 10 Billion in 2050
Urbanization: 50% of global population living in cities rising to 70% in 2050
Rise of the south: Unprecedented growth in Brazil, China, India, Indonesia, Mexico, South Africa and Turkey
Aging population: Out of every 9 persons, 1 is aged 60 years or over. In 2050, 1 out of every 5 will be over 60
Youth unemployment: 30% rise in youth unemployment in developed countries since 2007
Distribution of wealth: 10% of our population owns 85% of global assets
We see several emerging economic trends that will create challenges and opportunities for our corporate and institutional clients, and consequently generate areas where MCI can innovate and develop new services and products.
Governments alone cannot address these mega forces. Businesses are increasingly working with NGOs and governments to combine efforts and develop solutions and private-public partnerships that will help to create a more sustainable future. By enhancing processes, creating efficiencies, managing risk and driving innovation, business will contribute to society and long-term economic growth.
The linear ‘take, make, dispose’ model relies on large quantities of easily accessible resources and energy, and as such is increasingly unfit for the reality in which we operate. In the quest to improve resource performance and economic efficiency, businesses are on a mission to explore ways to reuse products and components. No longer seen as waste – precious material, energy and labour inputs can be recycled and reused in a circular fashion. A circular economy is an industrial system that is restorative or regenerative by intention and design. It replaces the ‘end-of-life’ concept with restoration and shifts towards the use of renewable energy.
Eliminating the use of toxic chemicals which impair reuse, circular economies aim to eliminate waste through the superior design of materials, products, systems and business models. A recent study commissioned by the Ellen MacArthur Foundation concluded that if a subset of EU manufacturing sectors switched to more circular business models, there would be an annual net material cost saving opportunity of up to $630billion.
Operational Risk Assessment
Risk Assessment Process
Our risk assessment process reviews over 90 risks that are divided into 8 areas:
- Business Development
- Governance / structure
- Human Resources (HR)
- Information Technology (IT)
- Laws and regulations / Compliance
- Reporting control
Key and Potential Risks Identified in 2016
- Lack of data protection (privacy & security) processes
- Inadequate monitoring of event’s productivity
- Non-compliance with MCI operational cash management policy
- Risk currency management on offices/legal entities
- Loss of key personnel – failure to retain employees
- Not taking advantage of MCI unified network (miss out on greater scale or optimisation opportunities)
- Failure to monitor IT projects and Group/Local IT costs
- Lack of clarity on legal guidelines and processes within MCI – lack of training and/or communication on clients’ and suppliers’ contractual commitments
- Loss of a key customer
- Inappropriate or unapproved investment and capital expenditures
- Inappropriate merger & acquisition process
Why Sustainability Matters to MCI
Talent feedback on MCI’s Sustainability Programme revealed the following:
- 91% agree that MCI is a company committed to sustainability
- 69% agree that the Sustainability Programme makes Talent feel more engaged
- 43% of Talent have discussed MCI’s Sustainability Services with clients
In summary we believe that “Sustainability Matters” and that there are five key points as to why a focus on sustainability is critical for MCI:
- At the heart of any sustainability discussion is the question “how can we use fewer resources, specifically those of a non-renewable and safe nature?” Smart businesses understand that accelerated consumption, globalisation, hyper-connectivity, disparate prosperity, ecological decline and a lack of global sustainability governance lead to the need for an in-depth understanding of the sustainability of our supply chains.
- At MCI, we believe that we have an opportunity to become part of the solution and to help lead the transition to a more sustainable global economy. Through a focus on reducing emissions, increasing social benefit, improving resource usage and energy efficiency, we are not only “doing good,” we are saving our bottom line and future-proofing our business.
- As an organisation, we owe it to the communities we work and live in to ensure we behave in a responsible and sustainable way.
- Businesses are increasingly accountable for their impact and actions. In the digital age, corporate behaviour is often debated in public forums and transparency has become a key requirement for companies not only in terms of finance but the validity of their sustainability commitments. Regulators and governments are now looking closely at the environmental cost of their GDP and increasingly legislating around corporate responsibility, governance, carbon emissions and the protection of the environment.
- We strongly believe that to succeed we must embrace a new philosophy: move beyond earning the “License to Operate”, the minimum required standard, towards earning a “License to Lead”, in which business serves the needs of shareholders and broader stakeholders by being profitable and acting as a positive force in society.
- Sustainability used to be the exclusive domain of experts, activists and idealists. Then, it moved into a silo at the outskirts of the corporate landscape. Today, it is seen as an important part of any forward-thinking and well-integrated company. Our clients and partners are developing their sustainability programmes and demanding more responsible, transparent business practices in their procurement processes. In the future we increasingly expect corporations to select their partners based on their sustainability performance.
- To MCI, sustainability is a business imperative, a driver of innovation and a method to engage stakeholders whilst motivating and attracting our staff – all of which provides us with a competitive advantage.
- Business growth remains strong in the sustainability arena. From clean-tech to renewable energy, green buildings and sustainable fashion, all sectors are focused on making more sustainable products and services. To achieve the market transition to a sustainable economy, people will need to meet, associations will need to engage members, governments will need to form collaborations and businesses will need to launch new products and incentivise their staff.
- The growth of this green sustainable economy is providing business opportunities for MCI. Since we started our sustainability programme, MCI has organised over 850 events group-wide within the sustainability and energy sector, and provided strategic advisory services to many of the leaders of the sustainability movement such as the UN Global Compact and the Global Reporting Initiative. We see a clear business opportunity to help our clients to engage and activate their stakeholders around sustainable development issues.
- Resilience is the capacity of a system to survive, adapt, and grow in the face of unforeseen changes, even catastrophic incidents.
- In a world of climate change, resource scarcity, political turbulence, social change, constant technological developments and mounting regulatory pressures, industrial growth does not always proceed smoothly. MCI needs to be able to flourish and grow in the face of uncertainty and constant change. We believe a sustainable company is also a resilient company, and that our sustainability programme helps us to foresee and overcome disruptions and to continually transform ourselves to meet the changing needs and expectations of our customers, talent, shareholders and other stakeholders.