Wealth

Turning ghettos into Grollo’s

Written by Jill Fraser

Corporations are fast realising that they can't ignore social and environmental issues.

In the game of corporate social commitment construction giant, Grocon Pty Ltd, Australia's largest privately owned development and construction company, has just played its trump card.

In partnership with the Victorian government Grocon is constructing a $50 million inner-city homeless shelter in Melbourne, sacrificing up to $15 million profit in the process. Grocon CEO, Daniel Grollo, who was handed the reins of the family's multi-million dollar firm in 1999, says that this project is part of the company's new direction.

Voicing his concerns about the building and development industry's lack of attention to the impact it is leaving behind, Grollo talks of his growing awareness of his organisation's social and environmental footprint.

Becoming socially aware does not mean that it can't be a win/win situation, he says, even if the books indicate a $15 million shortfall.

"Yes, it is a loss of profit but I have to be honest and say that I don't quite look at it that way. I see that we are getting value out of it," admits the charismatic Grocon chief.

"For one, we are getting closer to our community and two, we are getting great engagement with our people who either work on the project or have the opportunity to observe what we are doing.

"There is of course a limit to how much of this work we can do at any one time because we have to run a profitable business. But what we are doing here I don't see as a cost."

The 10-storey shelter, to be built at 660 Elizabeth Street, Melbourne, is based on a New York supportive housing model known as Common Ground. It will house up to 120 homeless people and have on-site mental health referrals, drug and alcohol counselling and employment services and is expected to be completed in 2010.

Common Ground, which was established in 1990, has created more than 2,000 units of permanent and transitional housing in New York City, Connecticut, and upstate New York and reduced street homelessness by 87 percent in the 20-block Times Square neighbourhood, and by 43 percent in the surrounding 230 blocks of West Midtown.

Grollo attended a presentation by a spokesman from Common Ground and found the rationale and argument for early intervention and housing for the homeless compelling.

"It's a much better economic and social outcome than letting the homeless bounce around in the system, which ends up costing far more and has a much greater adverse impact on human lives," he says.

Grollo concedes that being born into wealth (his father is reportedly worth $80 million) means that understanding how the other half lives does not come easily.

"Do I have an appreciation for it? I would have to say no. Do I read about it and ponder it? Absolutely. But I don't think you can truly understand how desperate and difficult it is unless you're there."

Grollo's grandfather, Luigi began the business in the late 1950s. In the 1980s and 1990s his father, Bruno transformed it from a small concreting concern into a major building company. Grollo has extended the company's reach beyond the parameters of his hometown Melbourne, where Grocon buildings dominate the cityscape, into Queensland, NSW and Dubai.

He refers to the company's tenet of positive sustainability and social responsibility as a renewed focus pointing out that his grandfather created jobs for immigrants who couldn't find work.

"So he was looking after his own community even back then," he says. Philanthropic projects have been on Grocon's agenda for several years but over the past 12 months Grollo has shifted it up a notch with the instigation of an employment program in conjunction with the Brotherhood of St Lawrence and the juvenile justice system.

"To date every person we have taken on has been an exemplary individual and has gone into our workforce fabulously well. The people working with them have a sense of pride and achievement in taking that person on their journey in the organisation," he remarks.

Another arm of Grocon's Corporate Social Responsibility agenda is the Dina Grollo Community Fund, named after Grollo's late mother, which was launched last year.

The Fund distributes around $150,000 each year to charities and not for profit groups in NSW, Victoria and Queensland. Social awareness equals environmental awareness and increasing its sustainable practices is high on Grocon's to-do list.

Much of the material from buildings designated for demolition is recycled and the company's green image has just received a huge boost. Grocon beat five competitors to secure the contract for Dexus Property Group's new office tower, Space 1 Bligh.

The building, which is being constructed on the corner of Bligh, Bent and O'Connell Street, Sydney, promises to be a world leader in environmentally sustainable design.

Grollo, 38, joined Grocon at age 18 and worked his way up through the ranks. He admits that his career choice was pretty well set in stone and that he never really aspired to anything else.

He and his wife, Kat have two children, Finn, 9, and Tillie, 5 and having experienced discrimination as a child of Italian immigrants he hopes that tolerance and the valuing of differences is one aspect of his philosophy that gets passed on.

"Given that we operate in the Middle East I get concerned with the coverage that the area gets here. I go there for family holidays and watch my kids deal with the contrast and the realisation that 95 percent of the world is just like us," he says.

"Unfortunately it's very easy to fall into the hole of thinking that someone is bad just because they are different.

"I work on the premise that 99 percent of people are great and that we need to spend time understanding what makes each other tick."

His notion of thinking big is "not being constrained by the status quo".

"That is certainly how we try to run our company," he says. "At Grocon our goal is to always think beyond ourselves and push the boundaries."