Season 5, Episode 188 : Succeeding as a Social Enterprise: Lessons from Belu Water

SS Belu episode
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Will: Hi, and welcome to Sustainability Solved, the sustainable business podcast. I'm Will Richardson, the founder and CEO of the Green Element Group, incorporating Green Element, Compare Your Footprint, and of course, Sustainability Solved. We've been empowering organizations to manage their environmental impact for a just and sustainable world since 2004.
Charlie: And I'm Charlie Luxton, an architectural designer who focuses on sustainable buildings. Today we're talking to Charlotte Harrington, co CEO of Belu Water, a purpose led business which creates profit to do good in the world by selling bottled water and filtration systems. It was set up 20 years ago and in that time has donated nearly 6 million dollars [00:01:00] to its charity partner, WaterAid. Welcome, Charlotte.
Charlotte: Thanks for having me.
Will: You're the co CEO of Belu with Natalie Campbell, who was appointed in 2020. And you're not alone in this kind of setup. Netflix also has two CEOs. Funnily enough, Postcode Lottery have two or three managing directors, they're a client. And so tell me about why you have two people leading the company and the challenges and rewards of that.
Charlotte: Yeah, of course. It's always a good talking point, actually, because I think it is still quite unusual whilst you've cited a few examples. I think it's a, you know, it's a, something that if you're a founder of a business is very common.
So co founders exist, but actually when people talk about co CEOs, they're always curious to understand how does it work? What does it mean in reality? And for us, it came about quite organically and quite naturally. We were in the middle of the pandemic and Nat and I have very different skillsets. So actually putting ourselves together into ultimately, you know, the same role just made sense at that point in time.
And it means that. Essentially, [00:02:00] together, we can go further, we can go faster, we can have two very different views on, you know, issues that come up. And I think it means that we ultimately get to a position whereby we come out with a stronger, a stronger answer both for the team, but also for for for our impact.
So for us it's been about repositioning the business, the brand, the direction of travel, and then actually coming together to figure out how do we do this in a way that really lives all of our, all of our values, and enables us to maximize the impact that we can, we can deliver.
Charlie: But surely, you, you would normally think that like a CEO would be balanced by A-C-C-O-O or CFO. We're saying a lot of, uh, three letter acronyms here, but, you know, but that, that, that balancing process would happen sort of out with, of the, the single role of the CEO. But you're actually saying you see real value of. Before anything comes from that, that centralized position, it is already sort of sense checked. Is that sort of how you see it working?
Charlotte: Yeah. And I think, you know, for me, the CEO role is often felt to be quite a lonely role. And certainly when we [00:03:00] were looking at recruiting, um, Nat at that time or a new CEO at that time, I'd said, you know, I would do it as a job share, but I didn't want to do it on my own because I felt it would be really lonely.
And actually, we decided as a board that that would be quite difficult to recruit for roll forward six months. And that was the one that suggested it. And it just, as I said, came about quite organically. And I think it does enable us to sense check and kind of bounce ideas around in the same way that you might do with CFO in another business to come together with, A more balanced response before we then feed out the teams or take it to the board or shareholders and that sort of thing.
So you're right. We sort of do that, that that sort of play around between us. And I think that gets us to a better position faster than perhaps one person's view on the world.
Will: Do people find it easy to know who to talk to? Like, it's that line of command that I, that I'm interested in.
Charlotte: Yeah. So what we've done, I mean, [00:04:00] over the last, we've been doing this for four years now. So we sort of bounce things between us depending on, you know, what the need of business is, but also where we think we have potential. We need to kind of play to our strengths. So at the beginning, for example, I focused on growth and sort of international. This was in the middle of the pandemic on that was kind of getting to grips with the basis, the business and actually getting us back on track post pandemic.
So we sort of split the kind of roles in that way. roll forward. And actually, I've taken over most of the line responsibility of the team. So on the day to day basis, most of the senior leadership team reporting to me with the exceptional kind of brand, the cons, the strategy and the people side of things.
So we've sort of, we move things around to keep it fresh for us, but also to ensure that people do have that clarity. And we talk regularly. So the re the reality is they can't play us off. We do know exactly what, you know, what we're doing. And we also, you know, we've got into the habit now of almost being able to second guess what the other person would, would sort of say in response to anyone's questions or queries and that sort of thing.
So [00:05:00] it's created a really powerful partnership, I think, between us. You know, it's a bit like a marriage, you know, you have to work at it, you have to spend time on it, but the benefits of having it can be really, really positive.
Charlie: And do people refer to you as Natlot or, or Shartley at all? I don't know.
Charlotte: Not yet, but maybe they will after this.
Charlie: Can we just roll back a second, Charlotte? And I gave a very potted, um, introduction to Belu and it's been running for 20 years. So it'd be great to hear a little bit more about how it started from your perspective. I know you weren't there at the very beginning, but how, how, how it started from your perspective and how it's morphed and where it's going just to get a sense of, of, it as an organisation
Charlotte: Yeah, of course. So, I mean, Belu started, um, with a simple idea that, that in doing business, you could help solve some of the world's problems. The guy that founded it was a guy called Reed Paget, and his thinking was very much ahead of its time. You know, 20 years ago, people weren't looking at, you the [00:06:00] good that business could do or the way in which the, you know, a business could solve some of the world's problems.
So he was very forward thinking and pioneering in his, his kind of outlook and approach. So he started the business then morphed into kind of the business that you know, or is more familiar to people today in terms of, you know, a social enterprise, which now, you know, most people have heard about. And, you know, we are a business that That that has clear purpose, and we were founded with that belief, and I think that's the bit that sets us apart from a lot of businesses today, because lots of people are trying to retrofit and figure out how do we put values and purpose and impact and, you know, achieve our ESG and all of that sort of thing within a business that's already established.
Whereas we were founded. on that belief that you could help solve those world's problems. So the, the kind of the premise of the business today is that we supply primarily hospitality and corporates with bottled water, drinks and filtration systems that deliver [00:07:00] a impact to the world. So when I talk about the impact, it's really our purpose and our purpose is to change the way the world sees water, which is a really broad statement, but I think Today, probably more than ever in the UK, actually, we take water for granted.
So you get up in the morning, you put on the tap, you've got beautiful clean drinking water on the whole, and actually you use water probably 10 or 15 times before you even leave the house, but you don't think about it. Actually, when you, when you look across the world, that's not the reality for many people.
And so by us kind of shining a spotlight on water and the importance of water and the fact that everybody needs it to sustain life. We can, by taking what is a commoditized product, frame it in a different way for businesses to enable them to choose to work with Belu. And in working with Belu, we invest 100 percent of our profits into our purpose, which to date has meant giving 5.
8 million to, to WaterAid. So it's a really interesting, I guess, it's a business, but actually the shareholders ultimately are a charity. So we're. We, [00:08:00] we are a business, not a charity. And I always like to make that distinction really clear because we are not delivering the impact directly ourselves. So we are a commercial entity.
We trade as a commercial entity in a way that. we hope will inspire others to look at how they could replicate or be inspired by the business model because it is a little bit different. Um, and it does take some adjusting. So it does mean that some of the decisions that we make aren't those that a traditional business might make because we always ensure they're aligned against our values.
So things like, uh, thinking environment first is one of our core values. So everything that we do is through the lens of what does this mean? In the longer term, actually, how can we improve what we do? How can we make sure that what we do is better than anything else in the marketplace? And how do we talk about the things we do as much as the things we don't do?
Why don't we do those things? Because often those are the bits that businesses don't talk about. And actually, sometimes that's where the more interesting story is. So for us, it's about being really transparent and [00:09:00] demonstrating what's possible and where we struggle and where we're trying to get to is really a world where people do value.
This natural resource that is water, but also that people consume and procure responsibly. So we are one of those businesses that can demonstrate that it is possible to grow a business that is profitable, but actually really change the way in which impact is delivered across the world. So whether that's through a partnership.
like WaterAid or some of our other impact partners like the Rivers Trust or Blue Marine Foundation. These are all people that we believe are demonstrating what's possible and all come comes under that umbrella of our purpose around changing the way the world sees water.
Will: You've given huge amounts of money to WaterAid, six million for all intents and purposes. That relationship must be very strong. Does that relationship almost command some of the decisions you make at Belu because they must be [00:10:00] semi reliant on the money that you're giving them. So I would imagine it's symbiotic, but it must be quite hard to manage that relationship.
Charlotte: Yeah, it's an interesting, I guess, question in terms of it's, it's something that everyone in the team is really passionate about.
It is one of the partnerships where, you know, when you talk to people when you're interviewing them for, you know, for roles and that sort of things, or you talk to our, our clients and, you know, Particularly hotels and restaurants get really, really excited about the impact that war trade can deliver. So undoubtedly, yes, it is really important.
Does it change the way in which we make decisions? Sometimes, I guess it has done in the past. But we have a really clear, um, we call it our four Ps framework. And, you know, first and foremost, it's always about our purpose. It's then about people. It's then about our product. And the profit is a by product of all of those things coming together.
Rather than us just making decisions based on how much profit can we generate and therefore how much can we give to WaterAid. [00:11:00] Because if you do the latter, The risk there is that you compromise everything else, so you don't have the best product. You perhaps work your team too hard. It's not actually a sustainable business model that could be scaled.
So we're trying to, you know, we're still on that journey, but certainly we are striving to increase the The areas where we operate. So for example, we used to all only be based in the UK. We now have a filtration systems in Hong Kong and Singapore. And actually for us, you can only do that if you take a slightly different approach, the partnership is still key, but they are the beneficiaries of, of, of the, or the shareholders, arguably of the business.
They can't be the driving factor for, for every decision. Otherwise it's not a balanced decision making process. I have two questions.
Charlie: I always thought it was Belu, but you're saying Belu, which is, is it like Nike and Nike and Porsche and Porsche?
Charlotte: Yes, completely.
Charlie: Right, okay. I thought I put my foot in it there.
Charlotte: It can be anything you want it to be.
Charlie: Let's go Belu. You're the, you're [00:12:00] the boss. We'll go Belu.
Charlotte: Go on.
Charlie: Um, the second question is, um, well, actually I've got three questions. I'm getting greedy here, Will. I do apologize. The second question is Somehow, I've always been told, and this might be rubbish, and hopefully you can fill out the facts on this, that the bottled water is something like 3, 000 times more carbon intensive than water delivered through the tap.
How you get to that figure, who knows, and carbon intensity is a different figure, but clearly a bottle of water has a lot more embodied carbon than So right at the very heart of what you do, there is a slight contradiction. And so I'm interested about the, the, uh, the filtration system thing and, and, and that balance.
I mean, how do you respond to that? That contradiction?
Charlotte: And it absolutely is a contradiction. You're right. And when Belu was founded, it was founded as a sort of activist business. It was very much. Aimed at originally campaigning against bottled water because you are 100 percent right, you know, if you can consume water that is safe from the [00:13:00] tap from a carbon intensity perspective, that is the right thing to do.
And we do advocate that. So tap is best. The challenge is that in the markets where we operate, so hospitality, primarily bottled water is a key part of their financial model.
Charlie: Which is a problem.
Charlotte: Which is a problem. And when they're transitioning away from it, but it's a journey that they need to go on. And it's also, it also depends which market you're serving.
So there are some markets where, for example, if you are very reliant on, um, tourists, perhaps in some countries, they don't trust tap water, irrespective of, of, of what we might say in this country about tap water. They only trust drinking bottled water. So it depends who, who our clients, you know, and guests are, that has an impact on their perspective.
Perspective as well. So you are, you are right. It is much more carbon intensive. What we've tried to do is dispel some of the myths around, you know, how do you reduce the carbon intensity of it, whether that's lightweighting the materials, you know, we don't export our product. There's a number of things that we've done over the years, increasing the amount of [00:14:00] recycled content in the packaging that does improve the carbon intensity.
But ultimately, we would like to encourage our customers to move away from their reliance on bottled water and move to filtration systems because that enables them to upsell to their guests and still offer, you know, chilled, still sparkling water that can be presented in a beautiful bottle and they can still monetize in some way, but it does reduce significantly the carbon intensity.
Charlie: And, and are you seeing that filtration uptake? Growing steadily or is it, it feels like it's a sort of tsunami over the last two or three years that they're pretty much now you walk into any, any, any, uh, restaurant, hotel and ask for filtered water, you know, tap water, and they'll bring it out, filter it in a nice bottle.
And actually that, that is fantastic. And, and, and I suspect most people would be willing to sort of pay something towards that. I suspect. Maybe I'm wrong.
Charlotte: And on the whole, yeah, you're, you're absolutely right. That it's definitely, it's definitely picking up. We were, you know, we've been doing this for about five, six years, the filtered side of things.
And. In the early days, it was [00:15:00] the early adopters that were those that were talking about provenance for food and, you know, they set their business models up in a slightly different way, so they weren't relying on the income from bottled water. And, you know, some customers rejected it. You know, six years ago, it was like, oh, no, no, no, no, we must have bottled water.
Now, I would say the majority of our incoming inquiries tend to be about filtered water, but people on a journey. So for some people is right for maybe back of house, but it isn't right necessarily for their guests or it might be right in the cafe, but not in the Michelin star restaurant yet. So it's, it's really about taking our customers on that journey.
And because we can offer it all, we offer them whatever makes sense to them for the setting where they need to serve it. And, you know, we don't want to be too preachy, but, but ultimately we will share the facts with them. And then they can make the informed decision because we don't want to We can show them the carbon intensity of their choices.
So for us, it's about educating them as well and helping them advocate internally quite often. So explain it to the CFO. Why is this a good idea and what's the risk and how might they be able to [00:16:00] recover some of that revenue? Um, but consumers are definitely changing their opinion and you see, you know, the number of people you now see carrying a refillable bottle in comparison to five, six years ago is significant.
So I think we are getting there and that's what we're hoping to capitalize on.
Will: That makes sense. Uh, so before Belu. You worked for Tesco's WH Smith, so corporates, big corporates, and you're now working for, for all intents and purposes, potentially an activist kind of organization. What did you learn in that corporate life that you've been able to bring into Belu?
Charlotte: So I think my experience when I did, I spent 15 years of my career at, um, at those two businesses and, and they were great. learning ground, I think, for me commercially. I think had I not had that experience, I wouldn't have had the rounded outlook that I perhaps came to Belu with, both from an operational, but also from a commercial perspective.
I think [00:17:00] the other thing that I learned was that, you know, a business can be founded with clear values and, you know, and a purpose. If you don't live those when times are tough, actually the impact is that the credibility of those disappears. And I think those sorts of, you know, those moments have grounded me in terms of what's important to me.
And so my, you know, my personal values align with Belu's personal values in a way that perhaps in the corporate world, I didn't feel that you could necessarily be yourself and you couldn't necessarily, I mean, times have changed as well. So I think, you know, you can now be yourself and people embrace it perhaps in a, in a, in a, to a greater extent than they would have done in big corporates.
But I think for me, you know, there were frameworks that we worked to, there were, You know, commercial realities that you had to achieve that I've brought to blue, that's enabled us to become quite a structured business. So we talk, talk about being a 20 year old startup, but when people join us, they're surprised about the processes, the systems, you know, we've got things that [00:18:00] quite often startups don't have.
And I think, you know, your formative years of your career, really, really important. I learned a lot about what I didn't want to do going forward as well. So, you know, for me, the idea of shareholder value. dictating all decisions in a business was just fundamentally flawed. And I'd become really disillusioned with the, the reality of being in a corporate coupled with the fact that I had three really young kids and the idea of flexible working just wasn't embraced.
So I knew that whatever I did next in, in my career had to give me greater fulfillment, but much more flexibility. And I wanted to have a sense of. You know, what I do matters and makes a difference in this world, not that it's just about that kind of shareholder value, because that's not fulfilling. That for me just didn't, didn't mean enough.
Charlie: And have you found, I mean, obviously one sets out on these journeys with, with an ambition of how, how they might make you feel and the benefits that you talk about, the [00:19:00] fringe benefits of feeling good about getting up in the morning to say, I'm going to make a difference. Has that, has that sort of delivered on the, on the promise?
Charlotte: Absolutely. Yeah. I mean, I, I think it's, you know, you have it in any job, right? You have good days and you have bad days. We still have the same challenges. The pandemic was particularly challenging, but actually in terms of me personally, I think that what we do and how we do it is quite different in the marketplace.
And personally, that's quite fulfilling. I think the way in which we tackle. You know, challenges that come upon us or, you know, the way in which we optimize partnerships is quite interesting. And I think that, you know, because we're a growing business, so much is changing all of the time. It's really, really interesting.
And maybe one of the benefits of working in a smaller business is that you can see it end to end in, in real life. In a way that in big corporates, you know, you're a tiny cog in a massive machine. You never get that sense of it really matters what I do today, because there's a million other things going on.
Whereas in a small business, you can decide today that you're going to do something [00:20:00] and tomorrow that starts happening. And, you know, that is. to me much more rewarding. So there's a pace about it that you can set. So you can slow it down, you can speed it up, but actually you can make things happen in a way that just feels much more rewarding for you, but also for the team and for your customers.
Charlie: Do you also get a sense that, that, you know, Belu started 20 years ago when this idea of a purpose driven company, like, proper company, but purpose driven, was, you know, Very novel, but, but, you know, even in the last four years while you've been, you've been involved, it has massively, the whole sector's massively transformed.
Did you also get this halo benefit of we are lamplighters in actually the transformation of an industry, as well as the fact we're doing all this amazing stuff with WaterAid and trying to get people away from bottled water in the, in traditional formats. Is that part of the job satisfaction that you're getting?
An impact actually beyond the, beyond just the money that you can donate.
Charlotte: Yeah, it absolutely [00:21:00] is. I mean, we sometimes talk about, you know, the 10 X effect. How many people can we inspire to do things differently based on just learning a bit about how we go about business. And that is, you know, it is great to think you could influence other people beyond your, you know, your business and challenge them or coach them or mentor them and give them that opportunity to absolutely add to the impact in the world.
Because. There's so much information out there. Sometimes, you know, people don't know where to start and if they can look at somebody and say, but they've done it and this is how they did it, what can we learn? I think that's, yeah, that is hugely, hugely exciting. It, you know, it's the same with developing a team.
It's, you know, some of that. Personal, um, satisfaction comes from seeing your team grow and develop and thrive and, you know, and go off and do great things outside of the business sometimes as well, because that's, you know, that's the part that you've played much like a, you know, a teacher, I guess, as kids leave school.
Will: A lot of our listeners, they're either consultants broadly [00:22:00] across many different sectors or industries or CEOs or founders or senior leadership team. So, the stuff that you've learnt from previous careers, because there'll be lots of people that are transitioning into more purpose driven businesses, being your kind of, not eureka moment, but kind of, you know what, I'm really proud of what I did there because of, I learnt that from there to there.
Is that a question that's understandable?
Charlie: Poacher turned game cheaper. What martial arts tricks, judo tricks did you learn that you're now turning for good?
Charlotte: Um, so I think, um, oh, it's a good question. What have I learnt? I think I probably underestimated actually, so when I, I think when I left Tesco, I'd underestimated how much I knew and how much I'd learned and how applicable that would be beyond a, you know, because I've been in retail for 15 years, so beyond a [00:23:00] retailer or beyond I was in buying, so beyond buying, actually, you know, I think you can pigeonhole yourself and, and actually the thing that I realized was that You can apply your skills.
You've got quite general skills when you come out of retail. And, and I think corporates do have, you know, great learning frameworks and therefore, you know, you have been trained in ways that you maybe don't appreciate and you add such value to a small business that doesn't have that expertise. And I probably didn't appreciate that for a good few years, actually, until, you know, I'd really got into Belu and embraced it.
Um, but there is something, uh, there is, there is something quite, Challenging. I think about leaving that, that stability of a, of a bigger business and moving into a small business. But there is something also. So the freedom that you have actually the freedom to influence. The freedom to make decisions. To make mistakes.
And actually, you know, the ramifications are only, you know what you decide that they are. And there is, there is [00:24:00] much more, you know, satisfaction as a result because. You can set what you want to do. You can set the pace. You can set the tone. You can help set the culture. There's, there are just, you know, you've just got a broader remit.
And I think I hadn't appreciated that really does. apply in any, in any industry actually, probably at any level, but you have to take that leap of faith.
Will: What's the best, not best, this is a really rubbish, that's a rubbish way to frame it, but what's maybe one or two projects that you've, you've funded that you've gone, wow, that's brilliant. That's, um, you know, I'm really proud, like round a dinner table or if you're meeting other people, you go, this is the, this is what went on there.
Charlotte: Yeah. I mean, I think the other thing I should say about our partnership with WaterAid is that we give them unrestricted funds. So that means that we enable them to decide where the need is greatest and that they can then fund the, you know, they, they operate in 22 countries across the world.
So they can put that money wherever it [00:25:00] needs to be. Um, so we never claim to, you know, to run this project per se. It's about actually we enable. WaterAid to serve the communities where the need is greatest. You know, what was a huge privilege actually when I joined the business is that I went to Malawi to see WaterAid's work firsthand.
So whilst this wasn't necessarily a project specifically that we had funded, Typically, this is the sort of, the sort of work that they, they do. And we'd visited various communities, both pre and post intervention. And, um, there was one community and I can't, forgive me, I can't remember the name, but, um, it was essentially a very rural community.
We traveled for a good few hours on, you know, unmade roads to get there. And when we arrived, it was at a healthcare facility. And this was, I think, the only healthcare facility for miles around and it was primarily where women would come and have their babies if they weren't going to have them in, in the community.
And, [00:26:00] um, I, I think I'd had, my youngest was probably about nine or 10 months old. So to me, it was still quite a, you know, quite a raw emotion to, to, to, you know, to recall where I'd been in a very beautiful, clean hospital to then see what was effectively in the middle of nowhere, a shed with no running water.
And the birthing suite, if you could even call it that, was a room where there was a mattress on the floor and there was a bed. And then there was some cushions and up to four women at any point in time could be in labor in that room. And that was the moment. And it was really early on. It was about a couple of months into to me being at Ballew.
And It was that moment that I realized a how privileged I was, and be, you know, the reality across the world is quite different, but also how integral having clean water in those sorts of situations and a toilet would be because the number of, um, Children that didn't survive the number of babies and moms that didn't survive [00:27:00] because of that, because of the disease, because they couldn't clean themselves.
There was no dignity. All of these things became very real. And I think that, you know, that moment and that insight may, you know, gives you that even when times are tough, you should appreciate the, you know, the privileged life we live. But for me, The purpose of the business became really personal. So it became very real and, um, very relatable and, you know, just being able to say, I could make this difference and I could enable that hospital to have water and toilets and, you know, to educate the, The people that came from communities around about the importance of hygiene, I think is just so critical.
So then that would be one example. I think the other example, which probably is less, less intense, perhaps, is around from a sustainability perspective. We moved away from carbon offsetting a few years ago, we became slightly Disillusioned with the way in which we were able to buy the credits because we are not big enough to go directly to, [00:28:00] you know, to those that are creating that the sort of credits and see what's going on.
We had to buy through a broker and it was always a little bit too opaque for us. So we decided that actually, we would move the monies that we own. had traditionally done, we'd invested in carbon offsetting to supporting other, other charities, primarily with nature based solutions and increasing biodiversity UK.
So we started working with, um, the Rivers Trust, Thames 21 and more recently Blue Marine Foundation. And we've done some, you know, small scale, but restoration work around a canal up in Montgomery, which is very close to where our bottled water comes from. And for us, you know, it's a small way in which we can demonstrate what's possible, but you know, to your point earlier around how can other people amplify and, and, and kind of be inspired, you know, imagine if everybody did that, if everybody using water in their business just did one act like that.
And we are not talking big budgets. But considering how much money people channel into other initiatives [00:29:00] that don't necessarily deliver that benefit, those sorts of things are really easy for people to replicate. And there are lots of amazing businesses doing amazing things out there, um, that, you know, are about restoring some of the, the, the things that are essential for our, for our daily lives.
Um, so for us, there's, you pronged kind of approach, the global and then the local. Those are the things that I think are, you know, I'd say I'm proud about.
Charlie: But that sounds like quite a quite an extreme and actually very uh, honorable and uh, inspiring decision to say we just don't think these carbon credits is opaque enough, we're not completely convinced by it we're just going to park that and do our own thing.
Because you're obviously not getting the certificate with the You know, the edging and all of that stuff to say, but actually you've said no, we, we don't mind. We just, we believe this is better value for the planet and our purpose.
Charlotte: Yeah, a hundred percent. And I mean, again, it was something that I'd thought for a while, and I don't think it's fair to say that all carbon credits are, are, are [00:30:00] not, not valid, but the way in which we could access that market.
felt uncomfortable to us. It's not transparent. And one of the things that we always pride ourselves on being is transparent. So we publish all of our accounts, we have them audited, you know, we give everyone free access to our impact data. You know, everything is there in the hope that it will inspire others to do more.
And when we couldn't get that clarity, actually, we just decided to do it. To be guided by our gut instinct and our gut instinct was this is not money well invested and everything that we do, we want to see that the investment delivers to our impact. And so it's not about a return on that investment per se, but it is about being able to stand over it and confidently say that money was spent with this intention and this is what it delivered.
And we couldn't do that. So we needed to find a better way and you're absolutely right. It does mean that no longer can we claim we are carbon neutral, but we're comfortable with that because we still continue to follow the very exciting PAS 2060 [00:31:00] framework. And we follow that all the way through. So we completely measure our footprint.
We continue to reduce it. We make a forward commitment to reduce it. We just simply don't do the last step, which is offset. And instead we invest in nature based solutions. So we've kind of kept the bits that we feel work. But if The market becomes regulated. And if we believe there is a way in which we could have absolute clarity on where that money is going and impact that's delivered by that investment, we would absolutely re engage, but until then, we don't feel that it's the right thing for us.
Will: This was one of the reasons why I really wanted, we get asked by a lot of organizations to come on this podcast. This is one of the reasons why I was so excited about actually having, um, was I had a conversation with that. about this a couple of years ago when you were just transitioning into that. And I thought that was a very brave and honest way to look at how to run an organization.
And I think listening to you, you've done that. And then [00:32:00] the money that you're giving to WaterAid, for me, I feel Organizations listening and anyone who knows organizations should be almost saying to people, look what Belu are doing, they work in water, they deliver in water. So that's the other thing that I really like is the fact that you're not kind of going, oh yeah, we work in water and we're going to deliver, I don't know, something completely different.
You're actually, what, playing to your strengths. And I think that's really important because you know your strengths. And I think that almost strengthens your strengths as well.
Charlotte: Thank you.
Charlie: Do you think the fact that that you don't have shareholders jumping up and down saying you can't stop carpet credit offsetting has allowed you to make Those decisions, but I suppose in a way to say you don't have shareholders is not really fair because as you sort of alluded to, you do, but they're the people that benefit from WaterAid and from, you know, all the [00:33:00] other charities that you help.
So it's a kind of interesting one that it gives you the freedom to be better almost, doesn't it?
Charlotte: It does, but all of it's a conscious choice. Right. We, we could, so we do have a board, right? So we do have a board and we do have investors. So we are a traditional, you know, we are set up like a traditional business.
It's just that the dividend receiving shares sit with our foundation. So, you know, we do have those parties, but I think because we are so aligned behind our purpose and, you know, the fact that we're in water and that's our strength. They are, you know, they are activists as well, right? So I think that also helps.
I think the board being activist and being supportive of that sort of approach means that we are more likely to support, get support than we are pushback. So it does give us a freedom. You're right that maybe other businesses don't have. But my challenge to those that feel that that's a barrier for them and their businesses is to keep pushing.
Because actually, if you believe in something strongly enough, and your gut instinct is saying this is the right thing to do, [00:34:00] you, you have to advocate for that. And you have to advocate for change. And it is those activists, you know, intrapreneur leaders that we need in this world, because that's the only way that big businesses are going to be able to change in the right way.
That we need them to change. So you're right. We have a freedom that is quite unique. But despite that, I would hope, you know, we don't have the same resources, right? We don't have the same consultants working with us. We have to figure this out ourselves. So arguably where we might find things easier, there are probably other challenges that we're grappling with in a big business.
So. you don't have because you've got lots of insight and data and inputs and specialists and all that sort of thing in a way that we, you know, we don't have. We just have what we've learned along the way and what we pick up from, you know, our supply chain and that sort of thing.
Charlie: Do you think that even over the last four years that you've been involved in, you know, a purpose driven enterprise and, and, and the sort of the, the company's memory, [00:35:00] there has been a transition in the way that the wider sort of Financial business sector views you because I, you know, for example, access to borrowing, or, you know, if you want to try and do something where you need, you need funds, you know, I can imagine that traditionally there would have been like, yeah, they're sort of not really serious.
So why are we going to lend them money? That might be unfounded, but that's my sense. Is that true? And has that changed over the period that you've been involved? Or is it changing?
Charlotte: So I think it's a really fair question, actually. So I, you know, the reality is for an investor, there is no return on their investment from investing in Belu because all of the dividend receiving shares, the foundation, and therefore we can't pay the same sort of, you know, we don't, we can't pay a return on that.
So we are limited in terms of who would be interested in investing because actually we're looking for philanthropic investors. Now we are really fortunate because [00:36:00] we have our original investors still involved in the business today. So actually we have two primary investors who have been with us since the business started and continue to invest.
And actually it's through that that we've been able to scale up and start to actually invest to grow because We'd got to a point where, you know, even pre pandemic, we could only really continue at the level that we'd been at. So we're about a 6 million business, because if you give away all your profit, your cash doesn't quite align.
And so we were in this sort of really difficult position where we wanted to maximise the profit to water aid clearly. But we couldn't invest to grow the business. So we've, you know, we've had to, and the pandemic arguably helped us get to this point quite rather, you know, rather abruptly. Um, but we suddenly had to look at our, our business model and say, but this doesn't make sense because you can't give everything away and try and make the impact greater.
So we've been rebalancing and investing to grow in the last, you know, few years post pandemic, and we've got investment to enable that because you do [00:37:00] need that capital. But, you know, had we not had those philanthropic investors, I think it's a really interesting question as to who in the market would be interested and would it have appealed.
My sense or my hope would be that yes, it would, because I think there is much more talk around, you know, green finance and social impact and that it's becoming more of a common language and that investors want to diversify their portfolios. But in the reality where financing is really tough to get, would they take the risk?
I'm not sure.
Charlie: It feels to me like there is a bit of a tightrope that you're trying to walk here whereby you're trying to divert as much profit in the short term as possible to WaterAid and to the other charities that you're supporting. But equally, you need to keep some of that back to grow the business to ultimately create more money for them.
I imagine that is a constant, I mean, it's the same, I suppose it's the same balance that we all have every day running any kind of business, but it feels particularly, I don't know, sort of important for the decision making that you're making. [00:38:00]
Charlotte: It's massively important and, and it is a, it is a tightrope as you, as you describe because You know, people, you know, there is often a misconception between profit and cash.
And I think people don't realize that, you know, whilst one does fuel the other, actually, it's quite different timings and a small business, you feel that acutely. So we are always trying to Balance and especially as you're trying to scale, that's the other thing is that the growth isn't necessarily where you need it to be to justify the investments in people or office and all those things that you need to, to have as a scaling business.
So we are, you know, we have a plan called our Go Big plan and we are constantly looking at, you know, how do we balance the impact that we can deliver in any given year with the growth that we wanna achieve in two, three years ahead and the investments that needs in in that year. to explain, you know, why are we a 9 million business and, you know, giving 300, 000 and not a million away?
The reality is, if people understand what it takes to grow a business, they get it. It's when people don't understand [00:39:00] that, that you then have to figure out, what's the communication around? How do we explain this? And, and our approach has just been to create what we've called our purpose P& L and just to show people, you know, this is what happens.
Here's revenue. Here's the cost of goods. This is then, you know, need to pay our team, got an office. This is what's left at the end. But don't forget, we've also made all this capital investment infiltration machines, and, you know, to try and paint that picture because we've got nothing to hide. It's all there.
It's all in our accounts. But it is a tension that, you know, we kind of dial up and dial down depending on. how trade is going and, you know, what the opportunities are versus kind of what we want to do and where we want to get to. And as you say, it's, it's no different to any other business. It's just the impact feels more important perhaps, because this is then about transforming people's lives with the amazing work that war trade does.
So it's, it's, you know, it is a sort of, it's, you know, it's always a useful. Uh barometer, um, and also, you know, it's a really it's really grounding, right? It makes you really consider how you [00:40:00] invest and where you invest
Will: Finally, what's next for Belu? You know, what's, what's on the pipeline?
Charlotte: We have got lots of things bubbling at the moment.
Charlie: I love this. There's a pipeline, there's bubbling. I mean, this is
Charlotte: Yeah, it's, it's, yes, no pun intended. Um, So, um, Oh, what's next? So, so we've obviously, we also, I mentioned earlier, we set up in Hong Kong. We're about to launch in, um, Singapore, uh, just for clarity. That is not our bottled products. Uh, it is just our filter product.
So we are looking at a sort of city based, um, expansion plan, which is really exciting and Hong Kong was our first test base mainly because they came to us. We didn't, we, we didn't actually actually kind of think that we were going to go, um, global, um, but the opportunity presented itself and we thought that it was too good an opportunity to, to miss, um, and has proved to be really, really helpful in dispelling, I guess, the concern or the risk that the Belu brand and purpose wouldn't resonate beyond the UK.
So there's a lot more to come [00:41:00] in, in, in that sort of space. And then in the UK, I mean, we're still quite a small brand in the UK. Whilst we're quite well known in hospitality, we need to do some work around brand awareness to get us into more corporates and to figure out actually how we show up across the UK because it's a huge market.
Um, and at the moment we're still seeing a lot of imported waters and, you know, things that we should be able to replace quite quickly to give people, you know, a benefit from a carbon perspective, but also a much broader story. So there's a big piece of work that we need to do around brand awareness as well.
And then we've got some exciting new products launching later in the year. So, um, we're definitely keeping the team busy.
Charlie: Watch this space, watch this space.
Charlotte: Indeed.
Will: Thank you so much for coming on today.
Charlotte: Pleasure. Thank you for having me.
Charlie: Thank you, Charlotte. And that's it for this episode of Sustainability Solved.
Next month, we're going to be talking to Niall Cooper from Fair Game about the Football Sustainability Index. I know very little about football, but I do know it's big business, so it's going to be very interesting. Make [00:42:00] sure you hit follow in your app so you get notified as soon as that episode drops.
Will: And for questions and more information on sponsorship opportunities, email podcast@sustainabilitysolved.org and if you've enjoyed what you've heard today, please do leave us a review in your podcast app. It would be really appreciated.
Charlie: We got two five star reviews, uh, just I think a couple of days ago, did you know two five star reviews? So please do leave some reviews. We really appreciate them. Thanks for listening. I'm Charlie Luxton.
Will: And I'm Will Richardson.