Ethical Performance
inside intelligence for responsible business



More by SEAVIEW - Back to the summer 2001 issue
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case study

Corporate social responsibility is not practised only by large companies. A small hotel in southern England has developed innovative policies designed to improve the welfare of its staff. This has helped to strengthen the business and keep employee turnover rates at a low level

At the eastern end of the Isle of Wight, in a village overlooking the Solent and the English Channel, lies a small hotel. It only has 16 bedrooms and a standard room can be had for £70 a night in low season. Hardly the kind of place, you might imagine, where management would concern itself with ethical charters and stakeholder dialogue.

Yet earlier this year the Seaview Hotel became one of the first businesses to win accreditation from KPMG, the professional services group, for an ethical business charter run by the internet company GoodCorporation.

The Seaview has signed up to the GoodCorporation’s commitments relating to different stakeholder groups, including customers and local communities. But the main focus to date has been to improve the welfare of its staff.

Attracting and retaining staff is one of the biggest headaches for any small company and is a particular problem in the hotel and catering sector, where, according to Mayday Employment Consultants, staff turnover rates are in excess of 50 per cent a year.

Nicky Hayward, who co-owns the hotel with her husband Nick, says keeping staff is an ‘enormous problem’ in the catering industry and claims that ‘the money given to an apprentice chef can be less than an apprentice hairdresser receives.’ The longest-serving member of staff came to the Seaview as a washer-upper 20 years ago, and is now the hotel’s highest-paid employee. Hayward says that ‘as the longest-standing staff member, he should be adequately rewarded.’

The Seaview employs 40 staff and its turnover rate is just 14 per cent. ‘Our staff are our greatest resource – if they are trained and valued individually then they will professionally care for the guests’, says Hayward. Thirty-four of the 40 hotel staff took training programmes last year. Employees are encouraged to stay at the hotel and eat at the restaurant for a minimal price, so they can try out the food and see how the service feels. Each member of staff is paid to eat in other restaurants on the island so they can benchmark the Seaview’s performance for themselves.

They also take part in ‘job swaps’ each year. Hayward says staff perform better and find their jobs more fulfilling if they spend time working elsewhere in the hotel. Last year she moved to laundry duty for one week, while her husband was in housekeeping.

‘Being certified as one of the first –Good Corporations” allowed us to bring together our wider social responsibilities and state them in a much clearer way,’ says Hayward. ‘While our values and beliefs have existed since we began in 1980, the charter helped us to structure the company.’

IBE comment

Small and medium-sized businesses consistently state that the business ethics issues which most directly affect them can be summed up in a few words: late payment and the retention of reliable staff.

This case illustrates the way one small hotel business has set about the second of these two issues.

What is noticeable about the owners’approach is:

A strong desire by the owners to behave ethically

Staff welfare has been made a top business priority

Lower turnover rates indicate the policy is working

The ‘job swap’policy is imaginative

Business Ethics is not just the prerogative of the largest organizations: it applies to all businesses whatever their size.

Simon Webley, Institute of Business Ethics

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