CPA Australia’s response to Uluru Statement from the Heart

Garreth Hanley:
This is With Interest. A business, finance and accounting News podcast, brought to you by CPA Australia.

Dr Jane Rennie:
Hello and welcome to With Interest. I'm Dr. Jane Rennie, General Manager Media and Content at CPA Australia. CPA Australia recently released our response to the Uluru Statement from the Heart. In this episode, we'll discuss what it actually means and why CPA Australia, a professional accounting organisation, is taking a stance on Indigenous issues. More broadly, we'll explore why businesses are involving themselves in ostensibly social issues in increasing numbers. Should we welcome this trend or should we be worried that some businesses may engage in social washing? Joining me to provide an expert perspective are CPA Australia's Senior Manager Culture, Capability and Wellbeing, Simone Spaulding; and Senior Manager Environmental, Social and Governance Policy, Patrick Viljoen. Welcome to With Interest, Simone and Patrick.

Patrick Viljoen:
Thanks Jane.

Simone Spaulding:
Thank you.

Dr Jane Rennie:
Simone, for anyone who's listening and who is not familiar with the Uluru Statement, what exactly is it?

Simone Spaulding:
The Uluru Statement from the Heart is an invitation that was created by a representative group of Indigenous Australians on behalf of all Aboriginal and Torres Strait Islander people to walk with them to reimagine our nation. The statement outlines a path forward for recognising Indigenous Australians as a part of the nation's constitution and seeks to do that in three ways. The first of which is through Voice to Parliament, promoting Indigenous Australians' people's rights to self-determination through treaty with Aboriginal and Torres Islander people, which Australia is the only commonwealth nation not to have a signed treaty for Aboriginal and Torres Strait Islander peoples. And truth which calls for a comprehensive truth-telling about Australia's history and acknowledges the culture, strength and resilience of Aboriginal and Torres Strait Islander people. The statement's also an artwork that represents two creation stories of the Anangu people and the traditional custodians of Uluru.

Dr Jane Rennie:
And I'm just thinking about how we've got here. Indigenous disadvantage is entrenched in many areas of Australian society, Patrick, when it comes to financial participation and I'm thinking homeownership, superannuation and other key metrics we associate with financial security, how do Indigenous Australians fair?

Patrick Viljoen:
Yeah, I think given the historical situation we have of underrepresentation in the workforce and various other things, superannuation contributions from First Nation people will always lag if you want to strike that comparison. In terms of the homeownership comparison, if we look at New South Wales for example, so in 2016, 42% of Aboriginal households in New South Wales owned or were purchasing their home, but if you compare that to non-Aboriginal people, that was around about 65% of people that were actively pursuing purchasing their home. So I think in that sense there is still that level of inequality in between aboriginal people and non-aboriginal people, and that's going to take years to rectify because obviously superannuation is linked to income. So if you have misrepresentation or underrepresentation of Aboriginal people, that'll have that lag effect.

Dr Jane Rennie:
And Simone, what about when we think of employment? So the participation rate for Indigenous Australians in the workforce generally, how does that bear?

Simone Spaulding:
So only 49% of Aboriginal and Torres Strait Islander people of working age are actually employed, and that is in comparison to 76% of non-Indigenous Australians. That actually increase or creeps up in capital city locations. So 59% we see that for Indigenous participation in the workforce, but it decreases down to as low as 35% for Indigenous Australians outside of capital city locations. Then when you think about that from an unemployment rate, the unemployment rate for Indigenous Australians is at 19% and that's near four times higher than what we see for non-Indigenous Australians. There was a recent study that was put out last year by the Minderoo Foundation, the Aboriginal Indigenous Employment Index, and that found that on average Indigenous employment got at 2.2%. Now when we've got 3.3% of the nation that are Australians Indigenous people, that isn't quite a parody yet. And in many of the organisation surveyed, that actually got down to as low as 0.17%. So we've got a really long way to go across those surveyed organisations to really increase participation in the workforce.

Dr Jane Rennie:
And many of our listeners are likely to work in professional services. How do those statistics match up when we look at professional service participation?

Simone Spaulding:
So when we look at professional service participation, the number of Aboriginal and Torres Strait Islander people included in the workforce is sitting at about 15%. So it is significantly lower and there is not a great proportion of people who are actually participating in professional services. So there is substantial room for improvement when we think about participation in the workforce

Dr Jane Rennie:
And they are quite shocking statistics that you've just outlined. But tell me what role can CPA Australia and the accounting profession generally play in reconciliation?

Simone Spaulding:
We see ourselves as a really trusted profession and accountants are really at the front line of businesses and their financial decisions right across the country. Accountants are a really credible source for people in organisations and can really impact across a number of societal issues, especially when we think about the impacts of diversity, equity, and inclusion at work. But more importantly, all Australians, including accountants and our CPA Australian members, really do have a role to play in enhancing the Australian democracy and the decision making that we see. And so every person has an individual voice or contribution that they can actually make to supporting greater inclusion for all people, and especially Australians First Nations people.

Dr Jane Rennie:
And you in fact were heavily involved in developing CPA Australia's response to the Uluru Statement. I will go into the detail of exactly what that means in a moment, but where did the impetus come from for this and why now?

Simone Spaulding:
So for us, we really started our reconciliation journey a number of years ago. We saw it as really important step forward for us advocating not just for who we are as an organisation, but within the profession. In April 2021, we actually held our first truth sharing panel, which was about a participation for our First Nations CPA Australian members as well as a number of our employees. But it was last year when we embarked on the second phase for our reconciliation journey and established an Indigenous advisory group that we really in conversation with our advisory group, talked to them about what were some of the really critical issues that they were seeing and what was a greater role that we could be playing in the community and having an affirmed view around the response to Uluru Statement from the Heart was really important for us to take now as we were maturing through our reconciliation journey.

Dr Jane Rennie:
Tell me a little bit more about that. Why did CPA Australia feel that it is important to support the statement?

Simone Spaulding:
Well, for us, I think it was a great representation of our commitment to our reconciliation journey and something that we saw through our membership with Diversity Council of Australia and all of the members were really quite vocal in their support. But we also saw that we have a really important role to play in enhancing a dialogue about societal changes, of which having a connection to the Uluru Statement is just one of those. And so it's not just the right thing to do, but it's actually about how we can set a tone for the nation's future and really provide a great footing and a way forward for us. But it's also recognising that we have a really significant opportunity to play in creating a shared future and to be an ally and advocate for truth selling, embracing voice no matter how uncomfortable that may be.

Dr Jane Rennie:
And if we get down to the nuts and bolts of it then, what exactly are we supporting?

Simone Spaulding:
We are really supporting a continued pursuit towards reconciliation. We're supporting that we advocate for and involve our First Nations people and recognise them as a part of our constitution, and continue towards a pathway to treaty and really supporting and enhancing that truth telling both at an organisational level, at a society level, and right across the greater Australian public just to be able to ensure that we are looking out for and really providing a safe space for all people to be included.

Dr Jane Rennie:
Patrick, I'd like to put this in a broader context. Do you see CPA Australia's response as part of a broader trend across corporate Australia with other organisations and businesses, say welcoming and expressing their support for the Uluru Statement?

Patrick Viljoen:
Yeah, I think I do. And I think it's also on the back of the fact that if you look at Reconciliation Action Plans across corporate Australia, that is getting a lot of traction. So the Reconciliation Action Plan, the group or network has run about 1,100 organisations that contribute towards it, which covers run about 3 million Australians that are directly employed by those organisations. But if you then think about the social impact those organisations have above and beyond the people they employ, it's a very broad net that we do cast, but there's definitely that level of momentum and groundswell.

Dr Jane Rennie:
All right, well I'm going to be a bit more provocative then now and ask you what business does CPA Australia have or indeed any other organisation have in doing something like this, which arguably has nothing to do with its core business?

Patrick Viljoen:
It's also about transparency and I think that's what we should focus on. So stakeholders, the broad range of stakeholders that we see organisations need to negotiate with are expecting that. They're expecting more transparency in terms of how organisations engage with the societies in which they operate and how they drive these kind of – and I use the word in it's loose as possible – says agendas that we are trying to put forward. So I think it will be that push coming in from stakeholders of demanding transparency from organisations and if we fail in that goal that's being set for us, businesses will suffer over duration and time.

Dr Jane Rennie:
Certainly in the past when businesses have involved themselves in social activity, we've seen critics come out of the woodwork and you get the typical stay in your lane or stick to your knitting type comment. Marriage equality was one example I know where we got that type of commentary in the past and we had people criticising this type of actions on the basis that it was corporate activism and hence improper. So what would you say to anyone who now suggested that what CPA Australia is doing or other organisations that support the Uluru Statement are doing as corporate activism?

Patrick Viljoen:
Yeah, look, I think the term activism is probably a bit of a misnomer because it's not about people outside of buildings picketing. This is not all we are talking about here, but it extends beyond that. What we're trying to get to is for organisations to recognise the societies in which they operate and their role in making sure that those societies are not exploited or there's no entrenched discrimination in those societies. So to use an equally evocative term, Jane, if we talk about the social licence to operate, and I know that elicits quite a broad range of reactions from different stakeholders, but what we are trying to get to here is for businesses in all good conscience to say that they're doing their level best in making sure that we take everyone along on our journey. And that impacts on strategy, it impacts on business models, it impacts on metrics, it impacts on performance measurement, and that's where accountants play. That's our role.

Dr Jane Rennie:
Patrick, even the mention of social licence to operate a couple of years ago had people very, very riled up. It was in mainstream newspapers, the criticism of social licence to operate. But to hear you talk about that now, would you say there's a greater understanding now than there was a couple of years ago that companies do in fact operate pursuant to a social contract?

Patrick Viljoen:
Yeah, I think over duration of time, what we've seen is that our stakeholders have become a lot more discerning and there's a bigger understanding of the broader concept of sustainability. So people are a lot more sort of, I think in tune with what we're trying to get to. When we talk about nature, I always make the point of saying it's not about hugging trees, it's about driving a bigger scheme and agenda that we're trying to get to. And the same applies here. So I think we need to decouple these pieces of terminology from that level of hardheadedness and get down to what we're trying to get to. And that is businesses need to do the right thing and fundamentally get that right.

Dr Jane Rennie:
But does that mean that the purpose of a business which is legally speaking to operate for profit, does that mean that role of the corporation has changed if making decisions around social considerations is now a proper purpose for businesses?

Patrick Viljoen:
I think what we're seeing also happening is there's a broader interpretation of value above and beyond just this financials and the bottom line, but you have to argue it or you can argue it from the opposite end. So if stakeholders are demanding certain things from organisations, whether that's nature, whether that's climate change action or whether that is what we're talking about today, which is a First Nation people, we're focused on First Nation people. If businesses get that wrong, if you look at it in basic economic sense, if businesses don't perform to that level, people will vote with their feet and take their money somewhere else. So there is an economic imperative to that, but it's recognising that we're trying to focus on profit and we should be safeguarding profit. We are not saying we are trying to be de-industrialise or harm organisations here, but what we are saying is you need to cast your net a bit broader about thinking about the value that you're putting forward. So your value proposition. Factor in the stakeholders and their views, and not all of them have the same level of importance. We know that. But then sort of adjust your strategy because in the end, that makes your business resilient and future-proof yourself. Jackie Blondell: If you're enjoying this podcast, you should check out our in-depth business and finance show, INTHEBLACK. Search for INTHEBLACK on your favourite podcast app today. And now back to With Interest.

Dr Jane Rennie:
Simone, as someone who's spent their career on the people side of the business, have you seen increasing demand from employees for businesses to involve themselves in social issues?

Simone Spaulding:
Absolutely, we have, and I think organisations really should be reflections of the communities in which they operate in. And we've seen the community expectations have changed and therefore our employee expectations have shifted. There is such a greater desire and it's one of those key pieces that people look at from an employee value proposition perspective for organisations to be really considered in regards to their shared value. People now more than ever before, see organisations as playing a critical role in shaping and progressing what matters most to them and their community. And so it's something that we see really important to our people and it's in the conversations that we have at work, but more broadly with candidates and in the market as well.

Dr Jane Rennie:
So would you say you can see a clear link between increased satisfaction and employee retention when employers do make their positions clear on social issues?

Simone Spaulding:
Absolutely, we do. And research has shown that time, time again when organisations invest in diversity, equity, and inclusion and the matters that matter most to their people, retention increases, turnover decreases. But there's also been research to show that there is increased employee satisfaction and actually impacts positively across the number of culture and engagement measures as well.

Dr Jane Rennie:
What about recruitment? Can it help with that?

Simone Spaulding:
Absolutely. And I mentioned DVP in practise, and this is one of those ways that we can differentiate ourselves in a market which is hyper-competitive, especially what we're seeing right now. There is really increased desirability of workplaces when you have a clear position in regards to social issues and D&I are really core factor into why people look to join but also stay in organisations. And there's actually been research that's shown there's a direct correlation between an effort in D&I areas of interest and there's increases in productivity and organisational performance. So there is a actual bottom line output here that is really quite considered as well.

Dr Jane Rennie:
Patrick, hearing that, I wonder if some businesses might think, "Right, let's jump on the bandwagon of social issues." But I wonder if there's a risk that that trend could in fact lead to tick-box behaviour because we've certainly seen that in the environmental space where companies have been accused of greenwashing. So could we see the emergence of social washing where organisations promote their social credentials without any real action, but in order to make themselves look good with their stakeholders?

Patrick Viljoen:
Yeah, there's always that risk and I think it's balancing, what we're trying to get across to businesses in as much as there will be a compliance component to that, that's just normal. But how do you balance that against getting the DNA correct of what we're trying to get across here? Look, we are not going down a quota route like other jurisdictions have done because that drives a certain level of behaviour, and I'm not going to take pot shots at other jurisdictions, but certain other countries have said, "Fine, we'll have a quota system," where you have to report according to the quota system, and that's linked to punitive measures in terms of fines if you don't meet that particular kind of ratio. We are not going down that route because that drives a particular kind of behaviour. What we are saying is that we are giving businesses the option here to critically rethink the way they do things and then sort of incorporate that back into their business operations. Now, we spoke earlier on about the discerning nature of stakeholders and you might end up in a situation where it's just a tick-box exercise and as much as have we done the baseline minimum of what we were supposed to do. The problem is to use an Australianism, does it pass the pub test? Because stakeholders will look at it and go through all of that in a fair level of detail and pick up if this is coming from the heart or not. Pardon the pun, we're talking about the Statement from the Heart. But does it come from that kind of viewpoint? If not, you get called out on it. I can guarantee you.

Dr Jane Rennie:
Simone, I wonder, are you in fact aware of any instances where that has happened with the Uluru Statement?

Simone Spaulding:
Yeah, it has actually been something that's come up in conversation with our advisory group where we've heard of instances where organisations came out quite early and pledged their support to the Uluru Statement early on, but have been really challenged now in terms of how do they actually demonstrate that commitment. It felt like a really easy or obvious thing to do to pledge support, but when you really reflect on those elements of voice, treaty and truth, the detail in there actually sits and becomes quite a lot more difficult. So there has been that come up in conversation and it was one of those points of consideration that we thought and reflected on quite deeply with our Indigenous advisory group on how would we demonstrate that.

Dr Jane Rennie:
Okay. Well that's a really great segue to my next question, which is what does come next for CPA Australia? We've published the statement, but now what?

Simone Spaulding:
Well, we're I think moving quite positively in regards to the maturity along our reconciliation journey. We're in the second phase of delivering our Reconciliation Action Plan, so Innovate RAP. We don't have all of the answers yet, but we have committed to continuing to work with our Indigenous advisory group to ensure that our actions are actually reflecting what we've espoused in our support of the statement. That is really about how do we embrace voice, and that's through our Indigenous advisory group. How do we think about truth-telling and uncover and unpack the really uncomfortable stories both within our organisation but within our sphere of influence as well? And look to seek how we can support different education pathways, create awareness, and really as an organisation, create an environment for our people that are culturally safe and inclusive for all people, especially for Australia's First Nations people.

Dr Jane Rennie:
Patrick, from your perspective, what's the gold standard for organisations in terms of building a commitment like this into their business model?

Patrick Viljoen:
Yeah, look, there's no independent third party that can certify you've hit a five-star rating or whatever at this point, but I would craft a response along two lines. One is recruitment and retention of talent, and then also more importantly, promotion of talent. Because what you tend to find sometimes is there's a big focus on recruiting, getting people into the organisation, but the same as we see with the underrepresentation of people from the LGBT+ community, women and First Nation people, there's an underrepresentation if you start looking at middle management level, senior management level and board. And that is an indictment on progression planning within organisations. So how do we shift our progression planning to take all of these considerations on board and take people along in the journey? So we're talking about career trajectories here. The second component is supply chain. So how do we as an organisation make sure that we do source responsibly, number one, from a nature and climate change perspective, but also do we actively engage with suppliers that do come from First Nation background or are run by First Nation people? And I know Simone, you might have views on that in terms of the kind of pressure that places on a very small supply pool, but are we actively thinking about that and how do we shift even just basic things like supply chains?

Dr Jane Rennie:
And that's a really good call out because I imagine that the pipeline of Indigenous businesses is pretty small at the moment, and that if large organisations are pledging to support them, this could create supply problems. So Simone, how do we deal with that?

Simone Spaulding:
It is absolutely something that is creating some challenges from a supply chain perspective, but it's really about, for us as an organisation and in our member base, we have a really critical role that we can play with uplifting capability. We talked about our sphere of influence when we were embarking on our reconciliation journey and understanding how can we actually provide the fundamental skills, knowledge and access to education to be able to support people. We do that through a number of initiatives and we'll be launching some this year in regards to support for First Nations businesses to really help think about how we can provide the education and support resource required to create sustainable First Nations businesses.

Dr Jane Rennie:
Patrick, we know that say by comparison, effective climate action does come at a higher cost. Does supporting Indigenous businesses potentially mean that other organisations need to accept higher costs?

Patrick Viljoen:
Yeah. Look, I think it's how do you view a selection of a supplier. And cost is one component of that, and it's a very important component, but it's one of plethora of components that I think we should be applying. And I think in that sense, you might end up in a situation where necessarily a First Nations supplier might be more expensive, but it's about also the kind of upskilling and to Simone's point, what we were talking about in terms of that level of education and upskilling we are bringing, it's thinking about those kind of issues as well. So it's not just about cost. For accountants, it's very easy for us to default back just into the cost base, but it's also thinking about a more rounded approach when we think about supply chain selection.

Dr Jane Rennie:
Another question I'd like to put to you both is then what would you like to see from the accounting and finance profession in respect of the Uluru Statement? What's your call to action to anyone who might be listening?

Simone Spaulding:
I think first and foremost, it's about educating yourself. So making connection with your local Aboriginal community. A great starting point might be your local Aboriginal land council to actually understand what the issues are at the coalface for where it is that you are operating, whether that be from a business perspective or from your own personal perspective. And actually start to understand what are the challenges at bay and how it is that you can provide support right at the coalface of challenges for your local community. And no matter how uncomfortable, I'll reiterate, it's just about creating safe spaces for truth-telling, no matter how uncomfortable that might be across your organisation, across the industry. But we really need to work with the broader Australian community to create a dialogue and understand where we've come from, but more importantly, what the options are for where it is we can go further from here.

Patrick Viljoen:
And I think also on the back of that, for our members, there is an opportunity to act as an advocate as well, irrespective of whether you are in a senior level position at this point in time or not. It's about the kind of voice that you bring to your team as well in terms of starting to think about all of these considerations a bit more. And it might feel like you're a lone voice in the middle of the wilderness, but those conversations are impactful and the right people do pick up on it. So I think don't be shy of starting to talk out about these things. The same as we've done with the whole plethora of other considerations, the same applies here, is acting in that advocacy space.

Dr Jane Rennie:
Does that include, as CPA Australia has, publicly issuing a response to the Uluru Statement?

Simone Spaulding:
I think that's one way, but that has to be aligned with how it is that you can best support from an organisational perspective. And I think it's just about what are the actions that are within your control that you can contribute towards that are really going to progress reconciliation more broadly. So I'd be thinking about what are the tangible actions that you can be taking at an organisational level, would be most important.

Patrick Viljoen:
And I think make sure that you've got the basics right first before going on and making a statement. Even with net-zero statements, that's the thing. We make a commitment and then we build up to that commitment. I think in this instance, make sure you've got the DNA right and you've got your approach right, and then go out to make a commitment. Because sometimes you don't want to end up Jane, to your point about social washing, of doing a commitment but there's no backing to it because people will pick up on that.

Dr Jane Rennie:
Patrick, where do you see it going? The trend of corporates and other organisations having a greater say or a public say in social issues?

Patrick Viljoen:
Look, I think the emphasis that we see on the S component within ESG is going to grow. I think there's a broader acceptance within society that not only are we a multicultural society within Australia, but also there's been a historical lack of focus on First Nation people. And if we're going to go down an avenue of wanting to have one cohesive society, we cannot leave people behind. It is not in the best interest of us as the country. When it comes back to this whole concept that we talk about when we think about climate change, for example, of a just transition. Whatever we do to move ourselves into the future, or whether that's adaptation or planning or whatever, it comes at a cost and it comes at an impact. That impact usually is felt by society, and we cannot move forward unless we safeguard everyone on the particular trajectory that we've put ourselves on. In the end, we're talking about people here. And it's making sure that fundamentally we are putting safeguards in place to make sure that everyone is... I don't want to say this because it sounds like a motherly statement, but everyone's fine.

Dr Jane Rennie:
That's all we've got time for today. Thanks very much to our guest experts, Simone Spaulding and Patrick Viljoen from CPA Australia. A link to CPA Australia's response to the Uluru Statement from the Heart is included in the show notes. With Interest is a weekly podcast. If you like what you've heard today, why not subscribe on your favourite podcast app? From all of us here at CPA Australia, thanks for listening.

Garreth Hanley:
You've been listening to With Interest, a CPA Australia podcast. If you've enjoyed this episode, help others discover With Interest by leaving us a review and sharing this episode with colleagues, clients, or anyone else interested in the latest finance, business, and accounting news. To find out more about our other podcasts and CPA Australia, check the show notes for this episode. We hope you can join us again for another episode of With Interest.