A Discussion with Peter Kelly
Join us for a discussion on sustainability in the construction industry.
Hello and welcome to the FigBytes’ podcast, The Sustainable Leading Edge, where we explore how business can be the driver for the shift to a net positive regenerative and inclusive economy and society. We’re required to recognize the changes we want to see in the world. And today’s guest is Peter Kelly, global director of sustainable operations. Welcome to the podcast, Pete.
Nice to see you again and thanks for joining us today.
So it would be so nice to hear about your own personal sustainability journey and how did you get to the role that you’re in today and what is your world about?
Oh, thanks Zita, so I had a natural love of the outdoor life when I was younger. I spent a lot of time on my bike out in the Woodlands and clubs and scouts and loved the outdoor life, camping and that kind of thing. And that led to a natural affinity with geography. And so I studied GCSE and A-level geography and then decided that I didn’t really know what I wanted to do with my career.
So for a while I enjoy geography, so I’m going to do a geography degree. And while I was doing a minor, of course I also worked in Waitrose, but I didn’t particularly like being told what to do. I’m not very good at being told what to do by by anybody, including my own parents. So I just thought it’s a good friend who worked on the construction site and he said, Oh, come in, come work with me labor.
And you get treated like a man on site. So I thought I’d give that a go. And I think the first day that he brought me on site, I think they gave me a particularly really difficult job to do, very physically taxing job and to test me, I think just to see whether I was up for the up for the challenge or not.
But I must admit, the following morning I did seriously think of staying in bed, but I thought, no, I’ll get up. Determined to give it another shot. And it got easier and easier and it was, I need to earn money, really. So I had some pocket money coming in while I was doing my A-levels and I really enjoyed it.
I love being outside. I love the camaraderie and the crack, as we call it, and with the with the guys and so on, girls. And so I did that for quite a long time. I did that all the way through my university, all the summers, all the holidays. I just kept this particular company call called Get your concrete contracting Firm in Central London.
And yeah, they, they gave me a job, basically. And then I left university and I didn’t really know what I wanted to do either. So I thought, I want to go traveling. And so again, I went back and worked and saved up the money on a construction site. And then when I returned from traveling, I thought, Well, I’ve really got to get a career now.
So I actually went to work for Multiplex at Wembley Stadium, which was my first kind of major contracting job, very different to working for a subcontractor. And once that job was closing in on an end date, I applied funny enough to be a construction manager. A lot of the different major contractors. But Sir Robert McAlpine responded and said, Actually, with your geography background and your construction experience, would you be interested in joining our environmental management team.
And I was like, Wow, you can you can do environmental management as a career. Like, I never expected that. So I thought, Wow, this is a to give them an opportunity to turn down. So yeah, I accepted the job with Sir Robert McAlpine and started the best part of 18 years ago, looking at environmental management systems, developing by setting standards, doing site inspections to discuss the economy.
The fun stuff.
I loved it. I loved it. And I love being on site. I love meeting different people. I love traveling across the country. I got to go to places I’d never been to before in Scotland and Wales and Newcastle and Liverpool, all sorts of places that I’d never actually been to before. So yeah, I really enjoyed it. I really enjoyed it. And then the rest, they say, is history.
And now you are group director. How, how are you doing the day to day as a group director at ISG?
Yeah. It’s, it’s, it’s been great. I’ve really enjoyed the challenge. I started ISG as a regional sustainability manager and and in the construction London region, very at home then very comfort zone but then stretched my wings a little bit and moved into the fits out and then the engineering services businesses and eventually it’s a group level and then eventually into this role.
And I’ve really enjoyed it. It’s been very different to an operational role. It’s very strategic, it’s very stakeholder management focused in terms of managing up as well as as laterally. So not just across the enabling departments and the managing directors, both up to the step boards and then of course operationally managing what’s now quite a large team across the different business units.
So it’s it’s very self motivating and you have to be self-motivated and you don’t get a huge amount of direction as you probably expect when you’re a bit more junior. So you have to set your own agenda. And I’ve really relished that and really enjoyed that. And that strategic piece is, to be honest, always were always where I wanted to get to.
And I’m just very lucky that I’ve managed to achieve that. I mean.
That actually leads me to a question that I was going to ask you later on, but how do you actually build that buy in with those stakeholders, even if you’re looking up or down within the organization and outside as a supply chain, for example?
I think there’s a when you’re starting off more junior, it’s very quid pro grow. It’s it’s like, I’ll do something for you if you do something for me. And I always say to people, people don’t buy into anything. Does it matter what it is? Not just just anybody. They buy into you. They want to do something because you know, you’ve got a rapport, a relationship with them, and it’s the same throughout your career.
You have to build relationships and you have to understand what rents and different people take and what their wants and desires and needs are. And then you have to cater your message to that. So what’s concerning them? What’s their stay away, what’s their major agenda item and how can you how can you align what you need to achieve with what they need to achieve, whether that’s the managing director that has to win work and how sustainability can therefore help us.
We work with some clients, etc. So you have to find not necessarily the altruistic nature of sustainability in people, you have to find what how you can link it to their goals and their aspirations and then build a relationship. And I often find breaking bread with people, you know, having lunch really breaks down barriers, evening meals, drinks. So it won’t be a big surprise to you know, I’m a really big advocate of socializing and breaking those barriers down and getting to know somebody properly so you can remember and say, our house as you you know, how’s little Jonny or, you know, it wasn’t too well last time we spoke.
How are they? You know, people remember that you’ve made the effort to to remember what’s going on in their lives. And it just helps you with relationship building and then getting your message across and and people buy into you.
That’s actually a good advice, probably for people who are actually just starting their sustainability journey. And I was going to ask you on a couple of things, like what would be your advice to those organizations who are at the very beginning in their baby steps and what can they learn about the efforts that ISG has been achieving? Putting in?
I think the crucial thing to any business is understanding what your impact is. If you’re clear on what impact you have, then you can do something about it. And different business service lines have very, very different impacts, whether it’s insurance or law or construction or tech, whatever The the industry you’re in has very, very different environmental, social governance, sustainability, whatever you want to call it, impact on the planet, on the people, etc..
So if you can understand whether that’s through data or some expertise or some expert advice, what their impact is, then you can do something about it. And that can always start small, build on it, find the low hanging fruit, deal with those first show some traction, build on that and communicate. Communication is so important in terms of those success stories and not on what wasn’t successful.
I think people learn more from what wasn’t successful and nobody’s good at sharing that. But if you can ensure that internally at least that will help you get traction.
And I think that’s also leading me to the next topic, which is I’m very curious, how do you feel the industry or the sustainability space changed since you first started in the environmental manager role? Because even in my like past five years, I can sense such, you know, massive changes and shifting in mindset towards sustainability. But for someone who’s been in it from a bit longer than I have, you must have seen massive changes.
Huge, enormous. And I think the biggest change more recently is that this change has lasted. We’ve seen an interest in our subject in the past, but as soon as the financial crash or the economy tanks or what have you, then it seems to dissipate fairly quickly. I was, if I’m honest, really worried about that with COVID. But if anything, I think that the sheer public understanding of what’s going on with the climate crisis has meant that that is not the case.
But certainly when I started, it was very environmentally risk focused. It was legislative focused, so very much making sure that we didn’t breach legislation, legislation, environment environmentally and very risk focused rather than doing anything above and beyond. It was it was the debris. And they’re very basically breeam and environmental compliance. And that that’s changed. I think that changed over time to understanding environmental impact and not quite to this extent.
We see today, but certainly around construction impacts like waste. That’s always been a big part of what we do water and biodiversity, etc. All of those things are very environmentally focused and carbon is has dominated more recently and now you see the evolution intersecting in economy, a much bigger focus on social value and of course the G part of ESG, the governance side.
So it’s been a huge evolution and the other positive is it’s taking in a much wider breadth of enabling departments. So the whole ESG pieces mean that we’re working much more closely with our health and safety supply chain and governance teams than we ever were before in terms of that reporting and global reporting initiative, etc.. So it’s it’s touching all parts of the business now in a way that it never has before.
And people understand the importance of it, not just for our clients, for ourselves, but also for attraction and retention of our talent. So, yeah, it’s it’s here to stay. Finally, I think we can say. And that’s that’s really, really great for anybody in our career at this moment in time.
I couldn’t agree more. And fingers crossed. I know you joined ISG quite a few years ago, so it would be interesting to hear that when that kind of the new sustainability program started and the things that you took on as a high level director, what were the challenges that you didn’t really expect to take kind of get in your way?
Well, I think it all usually comes back to people, doesn’t it? It’s not so much the the strategy side of it. It comes back to the people piece. So and we know, I think most people of my generation, with my experience, know what we need to do to decarbonize, introduce circularity, improve social value, be more governance orientated. But the basics have been there for some time.
It’s since we’ve drawn those together. I think now it’s a simple, really clear delivery plans and the investment side of it is going to be a challenge in terms of really pushing. This is going to take some investment, look at the R&D side of it, which as a as an industry we’re not great at in construction. And then it’s been the challenges around people management as always, you know, you’ve got and especially in sustainability, where staff have become very, very valuable, not just in our industry, but across all industries.
Now it’s very hard to get people and have more than maybe ten years experience because as we know, there wasn’t that many such a great call for it ten years ago. So there’s a big challenge around that management of talent and the pool of excellent people we’ve got working for us and and others that I know work across the industry.
So as always, people have a challenge, not so much the strategic piece. I think we know what to deliver and we need to get that through business planning, where the the cost and resource is always a challenge, but there’s always compromise. There and that’s how you run a business. It’s it’s the people management side of it. That’s always the challenge, especially I didn’t expect that to be such a big challenge.
I thought it would get easier as you get older and more experienced and you rise up the ladder, but if anything, it becomes more difficult.
Well, that’s kind of an advice, I guess, for others who aspire to get to your level and know how much responsibility it might come with as well. And having to try to retain that talent. And I can see, you know, from the job market that sustainability and environmental management has become. I don’t want to call it popular, but it’s very important.
So we are needed, which is a nice thing to have, not necessarily a good thing for yourself if you want to retain good stuff. But of course people can choose to work for the organizations that they agree with and you know, they morally want to support and the cause they are fighting for. Yeah, and.
I think there’s a challenge around and particularly in sustainability, we tend to be maybe not quite as red in the wheel of the personalities of those we work with in construction. So you have to dial up your ability to have those difficult conversations, to tell somebody to cool your jets that you know your time will come, you’re running before you can walk.
Well, there’s very difficult conversations when you’re managing people that perhaps they don’t want to hear and they just want to be there. My job in two years time and you know, the rest of it. So there’s a lot of difficult conversations. And managing that with people has been a real challenge and something I’ve had to come out of my comfort zone from a naturally more introverted greenside person to have those awkward, difficult conversations face to face in a room.
It is a skill that you desperately definitely need when you get to my level because you’d be surprised how often you have to have them say. And that’s as I mentioned, that’s the managing up that money, that’s managing laterally and managing them. Those difficult conversations are a skill that you quickly learn.
And when it comes to and I know ISG has been working with its supply chain to come up with kind of new solutions and more carbon and carbon friendly, environmentally friendly solutions to build with and how we manage our operations and how did you find engaging the supply chain I know is not necessarily personally your role, but you have worked with them a lot from memory, so it would be interesting to hear your opinion on how that was like in the beginning and how it has evolved since.
Yeah, I think they are. Supply chain are waking up to the fact that there’s greater communication between us and then understanding what our clients want. And so not just we are their client and what we want, but why. The reason why we’re not asking for this stuff just to make their lives difficult or cost them money or our program.
We’re asking it because of our own clients and what we want to achieve more our clients. And so achieving this space. So I think there’s a greater understanding of of the why of it all when it comes to sustainability. I think where there’s a is a real cross-section and there’s you’ve got the very small number of companies in our supply chain that are really at the leading edge and some of them are further ahead than us.
And then you’ve got the people that are coming in behind and then you’ve got the laggards at the end, that classic curve. So there’s a lot to be done and we’ve rationalized our supply chain into a much more bite sized capability around our preferred supply chain members, which obviously will tackle first. You know, they do 80% of our work and then we’ll move on to the to the smaller contractors.
We’ve done a lot of training with them through the supply chain Sustainability School and I’m sure they’ve done that with other contractors as well. So it’s not particularly new to them, but it’s certainly helped them that why piece why we are asking for some of this stuff. I think going forward we will look to be a bit more innovative and where we’ve got an innovation process now that we’re pretty happy with the ISG.
So there’s an ability for not just our supply chain but our manufacturers that we work closely with also to start coming to the party in terms of their R&D, what they’re working on, how they can lower in body carbon materials, you know, whatever it is, they can bring that to the party so that there’s going to be more in this space and potential for us to invest as well, where potentially where we won’t offset and we’ll help our supply chain to decarbonize and use that as a potential way of showing how we’re reducing our emissions.
So lots of ideas flying around, lots more engagements to be had. I think there are very open and open to what we’re asking of them. But you may be aware, but the current climate is quite challenging here in the economy, so we have to be mindful of that and they are largely SMEs and I need to keep the lights on and keep everybody paid in the minute.
So I’m sure by the time the economy settles down next year and the year after, we’ll be able to really push forward. And this is mostly about us getting our house in order anyway. But we’ve got some big plans and we’re really looking forward to collaboration because that’s the only way we’re going to deliver any of this really.
And when we are not specifically thinking about the e-books more, the S and the G, how do you see the supply chain if they have been improving? And what are the initiatives that you would be working on when it comes to the social and governance side of things? With supply chain.
I’m always very jealous of social value, to be honest, because it’s tangible. They can see the social value in practice when they employ as an apprentice. So they, you know, they are our supply chains in massive amounts and social body. They just don’t call it that. They probably do more than we do. If you add it all up across our supply chain, they do all sorts of boxing matches in their local community and teach boxing.
An incredible amount of work goes on in their local communities to support and, you know, young people, etc. So they do a huge amount. So ask asking them to do social value I don’t think is a huge ask of them. They’re using they’re keen to to support in any way they can really. And whether that’s the traditional charity fundraising or is it the physical works of doing of, you know, donating materials or physical works for some charity and through to the supply chain, to the staff and taking on the apprentices, etc..
So I think I think there’s plenty that they do already in that space. And the governance stuff is, I wouldn’t say a challenge, but it’s and it’s that transparency piece, I think in the industry that’s going to be a tough nut to crack. And initially it’s going to be the collection of data, the ability to be very transparent about how we’re doing in ESG and the governance side of it.
In terms of that being able to show and have the evidence for that governance piece, I think is going to be a culture change. But something again, it’s nothing that they shouldn’t be already doing anyway. It’s just a case of how understanding that it needs to be more collaborative process rather than then you know, a closed process.
Do you feel like that the changing kind of policies and governance space is affecting like your decision making as well as the supply chain that you’re working with?
No, the minute if I’m brutally honest, I don’t think we’ve got there yet. I mentioned earlier that we’re we’re setting ourselves up for success this year and we’re putting in a lot the policies and plans and thinking into practice and largely to to go forward next year.
And also when it comes to obviously, we have talked about the D side of things already, but apart from the obvious and reducing our carbon footprint, what do you think we need to focus on more to address the climate crisis?
Well, the huge there’s a couple of huge, huge, huge things. I mean, I’m passionate about circularity, but even before you think it circularity, the whole biodiversity crisis is is is as big if not bigger than the carbon crisis. So I think that’s a huge element to that and construction that perhaps, you know, we’re not, we’re not. And as I say with this, we need to be about where our materials come from, where they’re sourced from, and what impact that sourcing has in the environments with which we retrieve those materials from.
So I think that biodiversity crisis is enormous and possibly even more challenging or as challenging as the climate crisis. That would be number one. The circularity piece is something I’m very passionate about. The waste is a is waste. It’s it’s a ridiculous throwaway culture that we have. And we need to dramatically change to have a much more circular economy where everything is is it goes round and round in terms of re-use and we’re doing our bit in terms of construction, but a lot more needs to be done.
So I call it the post-consumer materials and the real challenge is the materials that have been used already, whether that’s in a building or if it’s out or whatever it is, whatever type of building it is, it’s getting those materials out and reusing them or remanufacture throwing them into something else. That’s the challenge rather than the recycling that goes on at the minute, which I’m sure you know is a lot of energy.
So that would be one, I think water and water for printing is also going to be a huge challenge given the climate crisis, obviously, and the amount of dry weather we’re having. So I think water for printing as well is an is the is the third challenge. So nothing easy there becoming a more secular economy and voice for printing, understanding the impact of new materials etc. and construction on water and then the materials resourcing in terms of biodiversity and etc..
Is there the three huge challenges I think we need to tackle alongside the climate crisis?
Yeah, it’s interesting from my side, speaking to companies from various different sides of the world rather than, you know, I used to be very much, you UK focused and it’s very interesting to see how the whole carbon focus is slowly starting to realize the need for, you know, better water management and managing water scarcity and the biodiversity. But as so many decisions and policies had to be created for it to kick in as much as carbon has been around and, you know, leading the way strongly.
And actually I’m very interested to hear what is a commonly held belief about the sustainability space that you passionately disagree with.
Oh, that’s a really good question. Wow. We have to take a minute to think.
I have a feeling you have one or more than one.
And I think the biggest one is around cost. It’s got to be around cost. And I think there’s a very common misconception that sustainability costs more. And I think it’s a lazy argument. So that that that definitely I feel passionately about is can be dispelled quite straightforwardly. If you plan for sustainability in whatever you do, it doesn’t matter what industry you’re in, if you plan correctly for whatever you’re trying to achieve, whether it’s lower carbon or more circularity or biodiversity, whatever it might be, if you take that into consideration and from the start, all the way through your process, then it’s no reason why there might be some investment required, but that will be required for any other product or service line that you want to introduce. But it shouldn’t be more long term, much more cost. And I think it’s been proved several times that there is that focus on ESG making more profit. So that’s certainly why one of it’s not the main reason, but it’s certainly one of the reasons our board are so interested in ESG, because they believe there’ll be a return on that investment and that ability to retain, attract and retain talent that age to win work, etcetera.
So that would be my first one is sustainable. It shouldn’t cost more. It might cost a bit of investment money depending on what you’re trying to achieve. But there will be a return if you do it properly.
I think working within the industry as well as like having to have those business cases in place to to get that buying was definitely a challenge, but it’s good to hear that now is becoming more easier to get that resource and buy in from from your management and your board as well to to have those programs in place.
Yeah, I think it is a challenge. I was talking to a colleague and one of our sister companies today and and showing that return on investment, on sustainability can be difficult over ten, 15, 20 years, etc.. So, you know, I think we could all improve our commercial skills and understand commerciality of the world we work in and again, as a director, you have to be able to do that.
You can’t just, you know, go for the utopia. It has to be based in and in return. So I think if people can understand that and we’re here to make profit as well as look after the planet, we know there will be any businesses. If we didn’t make profit, then it’s just how you make that profit. You can influence them.
So I think that the commerciality side of it is really, really important and I think that’s an important skill to learn throughout your career is is a business case and how you put that together and return on investment, basic skills like that. But certainly those that use that easy, easy, lazy excuse that it costs more and I don’t believe know what they’re talking about or haven’t done enough research to to prove whether that’s the case or not.
Yeah I couldn’t agree more actually doing those exercises myself. I think it’s so obvious that you will get better as a business if you if you improve your issue practices. And when it comes to like innovation in the industry and all the like, new coming requirements, what are those kind of resources that you rely on? I know you network a lot, but in terms of like using sustainability resources that you keep yourself informed with.
Yeah, that’s another good question. I think you’ve hit the nail on the head with networking. It’s largely transmission of information from internal colleagues tend to calling an external colleague to external colleague. So a very brief example is some regulations coming in. Well, it’s not really regulations. It’s a change of practice by the Environment Agency that was recently sent around by a colleague who works for Waits and is everybody aware of this?
This is the potential implications, etc.. And so that’s it’s nine times out of ten. That’s how it works. It’s somebody sends something and it could be anything. It could be a Guardian article, the Times article, it could be a sustainability publication, it could be a construction publication building magazine or what have you. And I genuinely should make more time to read.
And that is one of my personal goals this year. And I don’t mean them books because I, I read on the tube. I mean actionable and sustainability orientated information. I read the articles, it gets sent, I don’t always get the time to go looking for stuff unless there’s something very specific I need to research. So yeah, I acknowledge that and unless it’s like, you know, economy and construction report that I have to read or something like that, I need to do more of having so setting this time aside, I think to read around the subject a lot more, definitely.
Do you feel like that content is available in a simple space rather than you having to like cherry pick from here and there or receiving information? Do you feel like there’s kind of a challenge to to get that information and the right information to your way?
And I don’t think it’s all in one place. It depends what you’re looking for, really. So construction of the UK, GBC are very good and end of week communications the that’s the UK Green Building Council bids now put out some good stuff as well. And then there’s the wider aspect of and you know not just in construction and what other industries are up to, etc. and funnily enough, you tend to get a lot more of the bad stories, often the good stories I’m sure you’ve probably heard about all the recent shenanigans with offsetting and of course everyone’s like sending around articles about companies potentially being caught out by offsetting.
So yeah, it’s interesting. When something goes wrong, they fly as quick, quicker around them than the good stories. But yeah, I don’t think it’s one place I would say I go to and I think it’s it. But the information you like is or want is relatively available. It’s it’s not all in one place. I wouldn’t have said.
Yeah it’s interesting how you mentioned offsetting and how I started in my roll ups 810 months ago. I’m just looking at the calendar and even then people were asking more about offsetting and it’s becoming less and less because clearly there has been even around the ESG, like the term ESG becoming a bit more we shouldn’t we shouldn’t rely on on that specific term.
So it’s interesting how those can really affect the the processes people put in place and how they actually think about their own like ESG or sustainability journey. And you really need to like make sure how you actually even phrase things. It might be the same exact thing, but it might give a very different message to to someone who who wants to take that on board. Yeah.
And we don’t help ourselves with in acronyms and all the rest of it in terminology that’s quite frequently used. So yeah, I totally agree.
I mean, remembering all the acronyms from construction took me a few years to get my head around those. And so last but not least, and I’m keeping an eye on the clock as well. What makes you feel optimistic about the current sustainability climate and what’s coming next?
I’m really optimistic, I think. I think there’s never been more and more companies, more drive, more public awareness, more youth and movements around the climate crisis and everything that goes. We’ve discussed today. So and I’m hopeful for governmental change in terms of how they treat sustainability. So I think, again, I’m more hopeful that that will help to drive further change.
But a lot of the big companies are on this journey anyway. The the alignment of the ESG standards that’s going on at the minute, some of the legislation that’s coming out of Europe around reporting of impacts, etc.. And so, yeah, I’ve never been more optimistic if he’d asked me when I started my career, I would have been like, Oh, well, yeah, there’s this.
It’s a lot of compliance going on here and not a lot of impact reduction, but I genuinely feel that there’s never been a better time to be in sustainability because you can finally get some traction to reduce our impact as a business, not just individually or by individual projects or business units or individuals that have done good stuff.
But when I hand on her record in my annual report for next year, the ESG as a business has achieved this, this and this everywhere across the business and that’s that’s my simple goal for for this year is to is to roll out some initiatives that we can hand on heart, say ESG is delivered. And I think if every business did that, then we’d make a huge difference.
So, yeah, I’ve never been more optimistic and I think there’s some game changing. Technology will come. You know, there’s a lot of talk about hydrogen and the mix between hydrogen and hybrid with electricity. So yeah, I think we will get there. The cost of renewables dropping dramatically. There’s so much to be optimistic about. I think we’ve got a long way to go and a law we did a lot quicker, but I certainly think the momentum is the word I was looking for is it’s never been greater and I think that will only increase.
And I think the results of that hard work is became a bit quicker with with all that provided like technology and the the ability to put those resources in and make those changes. Whereas back in their back in the day you, you may have to wait longer for kind of a result that you want to see. And I guess that also influenced the decision makers.
They, they didn’t get that like instant results, so they wouldn’t think they should invest resources into that project, for example.
Yeah. I also think that the greenwashing piece is really coming to the fore finally. So companies are being held to account by what they’re actually putting out into the public domain about whether that’s actually tangible. True has has evidence behind it and so I think that’s also going to scare a lot of companies into the bandwagon jumping will be that’s we’re going to do this going to have to do this properly.
So that’s I think a huge momentum change as well, is that people have got their fingers burnt in terms of saying stuff they haven’t actually or aren’t going to achieve. So I think that will also help to drive forward change that we need to see.
Thank you so much for your thoughts today and sharing all your lovely experience. And I remember the times when we worked together and I remember deeply and thanks again for joining and sharing all of this with our listeners. And this was the Sustainable Leading Edge podcast with Peter Kelly and see you next time.
Thank you so much, Zita. I loved it.