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CHAPTER ONE: INTRODUCTION

Background

1.1 Since the early 1990s, there has been an increasing amount of commercial activity in schools in the United Kingdom ( UK) (Atherton and Wells, 1999), mirroring a similar trend in the United States ( US). The Scottish Executive has committed to examining the range of commercial activities taking place in Scottish schools, as well as the associated costs and benefits which, at present, are relatively unknown. The current study was therefore not intended as a national audit of such activity, but rather as an initial step towards obtaining an evidence base on the extent of commercial activity currently being undertaken in a small sample of Scottish schools. As a result, it aims to provide the Scottish Executive with a greater understanding of the associated issues and explore the possibility of making good practice more widely available.

The study

Aims

1.2 The main aims of the study were to:

• identify the range of commercial activity taking place in schools in Scotland and quantify the income they generate
• identify the different types of costs and benefits (including non-financial) associated with commercial activity in schools
• explore local authorities' views and their policy position on commercial activities in schools, and investigate the potential value of the Scottish Executive producing evidence of best practice.

Methodology

1.3 The study comprised three complementary strands:

Strand One: Desk-based review of literature
Strand Two: Telephone interviews
Strand Three: Case studies.
Strand One: Desk-based review of literature

1.4 A small-scale desk-based review was conducted of currently available literature, in order to provide a context for the research and to allow the contrast and comparison of findings from the study with other available evidence on commercial activity in schools. Sources for the review were drawn from a range of different sociological and educational databases, as well as from internet searches of relevant websites. Studies to be included in the review dated from the late 1990s, when accounts of the increase in commercial activity in schools became apparent in the literature.

Strand Two: Telephone interviews

1.5 Given the Scottish Executive's indication that a full national audit was not required, a telephone interview survey approach was adopted, rather than a questionnaire survey, in recognition of the complex issues associated with commercial activity and the project's aims overall.

1.6 Letters were sent by the Scottish Executive to Directors of Education in all 32 local authorities in Scotland, explaining the research, asking them to participate and to provide contact details for the most appropriate person to interview in relation to the study. One local authority declined to participate from the outset, while in two, although an initial contact was provided, it was not possible for the research team to gain agreement for an interview and in the remaining authority, no contact name was ever provided by the Director of Education. Thus, telephone interviews were conducted with a representative of 28 of the 32 local authorities.

1.7 Local authority interviewees included a range of staff, including those with financial responsibility, those with an advisory or curriculum responsibility and others with a brief for enterprise activity. Interviews focused on local authority perceptions of the extent and type of commercial activity currently taking place in Scottish schools, as well as the benefits and costs, or consequences, of being involved in such activity (for schools, businesses and individuals). Views were also sought on the local authority policy position regarding commercial activity in schools (including the existence of any guidance or policies and the perceived value of the introduction by the Scottish Executive of best practice guidelines), as well as key factors in good practice in such activity. In addition, interviewees were asked to identify schools (both primary and secondary) in their authority where a range of commercial activity was currently taking place.

1.8 Following the interviews with local authority personnel, telephone interviews were conducted with the headteacher, deputy headteacher or business manager/enterprise in education coordinator in 50 schools across 27 local authorities in Scotland (28 secondary and 22 primary schools). Interviewees were invited to comment on a similar range of issues to those covered in the local authority interviews but, in addition, were asked for their accounts of the rationale underpinning the decision to support commercial activity in their school and any consultation that took place before becoming involved. Also covered were financial issues, in particular the level of income generated by commercial activities, in terms of the percentage of the school budget that it represented, and where the money resulting from such activities was spent, for example, on the whole-school population or directed towards particular pupil groups in school. Interviewees were also asked for their perceptions of the influence of commercial activity on pupils' purchasing patterns and whether any particular type of commercial activity would not be acceptable in schools, for example, because of moral/ethical issues or bias.

Strand Three: Case studies

1.9 The third strand of the study involved case-study work in 6 schools (2 primary and 4 secondary schools) in 6 different local authorities. It was agreed with the Scottish Executive that the schools selected were to consist of those where a significant amount, and variety, of commercial activities were taking place. As a result, the case-study schools were situated in mainly urban and intermediate types of authority rather than rural areas where there were generally fewer large businesses or industries and thus, in some cases, less commercial activity going on. It should be noted, however, that the research team's attempt to include a school in a rural authority proved impossible within the timeframe for the research. The final case-study sample included three secondary schools in intermediate authorities, one secondary school in an urban authority, and two primary schools (one in an urban and one in an intermediate authority). It was agreed with the sponsor that the case studies would be reported separately and a summary of each one can be found in Annex 3. Their perspective is, however, present in the analysis of the interview data and thus in the main body of the report.

1.10 The case-study visits afforded an opportunity to focus in more depth on some of the issues raised in the telephone interviews with local authority and school personnel, as well as gathering opinions and experiences from a wider range of interviewees. These included: the headteacher and/or deputy headteacher, teachers, administrative staff with budgetary responsibility, business support manager, Enterprise in Education coordinator, and pupils.

Data analysis

1.11 All interviews conducted over the course of the research were taped and summarised. Analysis was completed using Max QDA, a qualitative research package, which involves the development of comprehensive coding frames which are then used to ascribe codes to segments of text. This allowed comparative analysis of the different commercial activities going on in schools in Scotland, as well as systematic analysis of the perceived benefits and costs accruing from such activity. The data was then written up thematically, according to the foci of the interview schedules (examples of the local authority and school telephone interview schedules, and the case-study school staff and pupil schedules can be found in Annex 4).

The report

1.12 The report draws on the data from all three strands of the research. A summary of each case study can be found in Annex 3.

• Chapter two presents a short summary of the literature review conducted for the study ( the full version can be found in Annex 1 of this report).
• Chapter three outlines the extent and type of commercial activity currently being undertaken in Scottish schools. It presents the rationale underpinning schools' adoption of such practices and considers any consultation that was undertaken prior to becoming involved. The chapter then moves on to focus on financial issues, in particular the accounts of income generated by commercial activity in schools, as well as where it is spent, and concludes with a brief discussion of perceptions of the likelihood of any expansion or reduction of this particular type of activity in Scottish schools.
• Chapter four identifies the benefits and the costs, or consequences, of commercial activity in schools for both schools themselves and the businesses with which they become involved, as well as for individuals (including school staff, pupils and parents). It also looks at any impact on pupils' purchasing patterns as a result of commercial activity within the school.
• Chapter five considers school and local authority views on the local authority policy position regarding commercial activity in schools, including the existence of any local authority- or school-level guidance or policies. In addition, it focuses on links to other policies, for example, Hungry for Success (Scottish Executive, 2003b) and the Determined to Succeed (DtS): Enterprise in Education (EiE) strategy (Scottish Executive, 2004), and relays views on the perceived value of the introduction by the Scottish Executive of best practice guidelines.
• Chapter six then identifies key factors in good practice in commercial activity in schools.
• Chapter seven ends the report by drawing out the implications from the above chapters for policy and practice.

CHAPTER TWO: LITERATURE REVIEW: KEY FINDINGS

About the research

2.1 The review considered key texts (including published research literature and, where appropriate, opinion pieces) published since 1998 that informed the body of knowledge internationally on commercial activities in schools. Research was drawn from a number of different sociological and educational databases covering the UK, Europe and OECD countries (an additional 11 countries, including Australia, Canada, New Zealand and the United States ( US)).

2.2 It was apparent from the review that the bulk of the literature on the concept of commercial activity in schools originated from the US, where most of the larger-scale research studies of such activity have been conducted. However, in recent years within the UK, a significant amount of literature has originated relating to children's health and nutrition, and the influence of advertising on this.

Introduction

2.3 Although the US has a long history of business involvement in education (Clark, 2004), since the early 1990s, commercial activities have been rapidly increasing (Larson, 2002). For schools, the growth of this activity is perhaps understandable, as it can appear an appealing means of addressing financial shortcomings at apparently little cost or effort. The benefits for businesses are also evident: increased sales and greater product loyalty, as well as a means of tapping into the acknowledged spending power of today's school children, not to mention the influence they have on their parents' spending.

2.4 In the UK, concern has been expressed in recent years that schools may be following a similar route to those in the US, with a concomitant increase in the amount of commercial activity taking place (Atherton and Wells, 1999; Rayner, 2001; Clark, 2004). Indeed, the National Union of Teachers ( NUT) has estimated that advertisers within the UK now spend some £300 million a year targeting the classroom (Clark, 2004), while research within the marketing industry has indicated that 90 per cent of companies surveyed had been involved in some kind of marketing to schools Atherton and Wells (1999).

Types of commercial activity

2.5 Four main types or arenas of commercial activity have been consistently identified within the literature:

• Arena 1: Product sales - the most common and arguably the most lucrative arena. It includes contracts between schools and businesses to sell branded products in school. Such contracts usually include food and drink, but may also include fundraising sales of, for example, cards and gift wrap.
• Arena 2: Direct advertising - a highly visible form of commercial activity, where companies advertise their product in schools, for example by having their logo on vending machines or by sponsoring a school football team.
• Arena 3: Indirect advertising - often through the promotion of corporate sponsored education materials ( SEMs) such as multimedia teaching kits, software, workbooks, lesson plans or reproducible activity sheets. Other forms of indirect advertising include corporate-sponsored contests and incentives such as voucher schemes
• Arena 4: Market research practices - the least common form of commercial activity in schools. Such practices involve the use of questionnaires, focus groups or the Internet to gather data on pupils' preferences and/or consumer habits, or to test new products and advertising strategies.

Benefits associated with commercial activity in schools

2.6 Benefits from involvement in commercial activity have been identified for both schools and businesses.

2.7 For schools, the benefits were reported in terms of much needed resources and revenue in the face of increasing budget constraints, and increased links with businesses including relating education more effectively to the world of work, increased work experience opportunities for students, and improved educational resource materials.

2.8 For businesses, commercial activities were said to represent an opportunity to boost product sales and generate brand loyalty, as well as providing a valuable public relations ( PR) opportunity.

Costs or consequences associated with commercial activity in schools

2.9 There is also an increasing awareness of the associated costs, or consequences, of commercial activities. Within the literature, these are expressed mainly in health-related or ethical terms:

2.10 Health-related costs/consequences focus on the impact on children's diet through the promotion of unhealthy dietary habits. The majority of children aged between 4 and 18 are said to eat higher than recommended levels of saturated fat, sugar and salt. As a result, the number of obese under-16-year-olds in England is reported to be over a million (Slater and Henry, 2002) and increasing. Obesity is reported to be affected by multiple factors, including exercise levels, meal habits, and exposure to media advertising. Within the latter, television viewing, which particularly exposes children to advertisements for unhealthy foods, was correlated with obesity (Livingstone and Helsper, 2004). However, a report published by Barnardo's (Ludvigson and Sharma, 2004) found that, when given the opportunity, pupils will make healthier choices and urged that involving them in decisions about the food available in schools was key.

2.11 Ethical costs/consequences focus on the exploitation of children through the presentation of commercial messages within an educational setting, which may be seen as an endorsement of the product, or may present "biased or incomplete" information (Consumers Union, 1998) promoting the standpoint of the company involved. Concern has also been expressed regarding students' privacy where companies provide Internet access or conduct market research in schools.

Policy and guidance on commercial activity in schools

2.12 In the US, commercial activities are said to be subject to the general federal and state laws applying to any business and to those governing school finance ( GAO, 2000). This report identified 19 states nationally with statutes or regulations specifically targeting commercial activities in schools, while Molnar (2004) reports that some local school boards have begun to restrict such activities.

2.13 In the UK, guidelines on commercially sponsored materials were produced by the National Consumer Council ( NCC) in 1989 and substantially revised in 1996. More recently, updated guidance on commercial activities in schools was issued by the Department for Education and Skills ( DfES) in conjunction with the Consumer's Association and the advertisers' association ISBA ( DfES, 2001). The Scottish Consumer Council is currently carrying out a consultation on sponsorship in schools in order to update the NCC guidelines for the Scottish context.

2.14 Closely linked, though not overtly, to policy and guidance on commercial activities in schools is the Determined to Succeed (DtS) strategy, which aims to contribute to the creation of an enterprise culture and economic growth in Scotland. The Scottish Executive has committed £86 million over 4 years to 2008 to the strategy which encourages the involvement of organisations in schools, whether they are commercial, public sector or voluntary organisations. The potential benefits for these organisations are clearly identified in DtS literature and on its website, however, potential costs or consequences are less evident. All 32 local authorities have developed DtS delivery plans in conjunction with the Scottish Executive's DtS team and local authority development officers will, in turn, provide guidance and training for teachers.

2.15 Following the report of the Expert Panel on School Meals, Hungry for Success (Scottish Executive, 2003b), which outlined the panel's vision for a revitalised school meals service in Scotland, the Scottish Executive committed to examining sponsorship and advertising in schools and set out its expectations for the removal of all overt advertising and branding from school dining rooms by 2006.

Concluding comments

2.16 This small-scale review of the literature presents a flavour of the most influential themes and issues arising from the literature. Immediately apparent is the fact that commercialism in schools appears to be on the increase. Significant benefits are clear for the schools and businesses involved, whilst the costs or consequences tend to be borne more by individuals, i.e. pupils, parents and teachers. The literature has stressed the need to weigh up the implications of involvement carefully and the need for clear policies and guidance.

2.17 Finally, several US sources have highlighted budget constraints as a reason for schools' increasing involvement with commercial organisations, with a number offering the view that more public funding of education is required in order to avoid schools' over-reliance on commercialism with the concomitant costs that have been outlined in this review.

CHAPTER THREE: THE EXTENT AND TYPE OF COMMERCIAL ACTIVITY IN SCHOOLS

Extent of commercial activity currently taking place in schools

3.1 Local authority interviewees were asked for their perceptions of the extent of commercial activity currently taking place in schools within their authority, for example, whether it was taking place across all schools or only in some schools, and whether there were any differences between types of schools ( e.g. urban/rural, primary/secondary).

3.2 The extent of commercial activity in schools was reported to be limited and to vary across local authorities. It was viewed as being relatively low-level activity, taking place mainly at individual school level, either because it was not particularly encouraged by the local authority, or because decisions about participation in this type of activity had been devolved to schools. Some schools were said to be limited in the scope of activity in which they could be involved because of their size, or because they were in more rural areas with little or no local industry or manufacturing. It should be noted, however, that perceptions of the extent of commercial activity were very much related to individual interpretations of what such activity actually constituted. Equally, such interpretations were likely to vary widely according to the role of the interviewee, for example, whether they had a financial, curriculum or enterprise brief.

3.3 As a result, more obvious forms of commercial activity, such as direct advertising of sports or drinks products, might be considered to be less prevalent, but contributions from local companies, or sponsorship of school events, could well exist in some form or another across all schools in an authority. At the same time, although the general perception was that slightly more was going at secondary level (mainly because they were larger institutions), some activities were more prevalent in one particular sector, for example, book-selling schemes tended to take place more often in primary schools, whereas vending machines were reported to operate almost solely in secondary schools.

3.4 Staff in the sample of 50 schools were asked to comment on how long commercial activity had been taking place in their schools. Again, perceptions were directly related to definitions of commercial activity, but generally, there was consensus that it had existed in some form or another, although usually small scale, for a number of years. For example, links with businesses, in particular through enterprise and citizenship activities, or through work experience programmes, were said to have been in existence for some time. Equally, voucher schemes such as the one operated by a leading supermarket were reported to have started in the mid-1990s, while tuck shop sales, school uniform sales and book-selling schemes were described as equally long-standing activities. One headteacher referred to not actively seeking out commercial activity, it was more likely to be in response to an identified need. For example, the school needed a new minibus and would thus be seeking sponsorship from local businesses for that.

Type of commercial activity currently taking place in schools

3.5 As the literature review for this study has shown, four main types, or arenas, of commercial activity have been consistently identified within the literature:

• Product sales
• Direct advertising
• Indirect advertising
• Market research.

3.6 These arenas were used as a starting point for discussions with local authority and school personnel about the different types of commercial activity currently taking place within their schools. Each category was explained and examples given to aid interviewees in their definitions. The activities identified are now discussed within each of those arenas and a summary of all activities identified within each arena is given in Figure 3.1 on page 18. The activities are listed in order of the most frequently identified within each arena.

Product sales

3.7 The most common form of product sales within the local authorities and schools in the sample involved the sale of food and drink. This activity took place through school tuck shops, school canteens and, as already highlighted, predominantly at secondary level, through vending machines.

3.8 Tuck shops were reported to be in operation in the majority of the primary schools in the sample. Very few examples of primary school tuck shops selling sweets or chocolate were cited. Most interviewees at primary level referred to selling healthier options, such as "healthy" crisps, fruit, water and fruit juice, in line with the current healthy eating agenda. One primary headteacher commented that the decision to sell healthier options in their school tuck shop had been made in response to particular concerns raised by the school dentist about the children's teeth.

3.9 At secondary level, interviewees referred in the main to school canteens and dining halls, where the catering was often managed by an outside catering service. The three examples given of secondary school tuck shops did include references to sweets, chocolate, crisps and fizzy drinks. It could well be that, at secondary level, phasing these out completely is a longer process where pupil preferences are more entrenched. An interesting example was provided in one secondary school where pupils had been encouraged to move away from buying fizzy drinks to buying bottled water. The school sells its own brand of still and sparkling water at 25 pence a bottle and flavoured water at 30 pence a bottle, with a profit to the school of approximately 6 pence a bottle. It had taken quite a long time to find a company willing to supply the product but now, it was felt, the school had a viable business that other schools would be able to adapt for their own use. The business had really taken off, with the school ordering 30,000 bottles for the start of the school year and having to order more by Christmas. It had since moved on to selling its own brand of healthy crisps ( e.g. low fat, low salt crisps) at 25 pence a packet. Having the school name on the labels was believed to be a big selling point:

"The bonus with selling your own brand is the attitude of the kids. They see [name of school] and it's pride in the place - it's not laughed out of the place, not in the slightest" (headteacher, secondary).

3.10 With one exception, vending machines operated solely at secondary level, with staff in just over half the 28 secondary schools in the sample (16) referring to this activity. The one exception at primary level was a school in an intermediate authority which had one vending machine selling flavoured water and fruit juice. At secondary level, the number of vending machines evident in schools varied from one to 5. Although a number of these machines still stocked sweets and crisps and a few of them fizzy drinks, the majority of both local authority and school interviewees reported a move towards stocking vending machines with healthier options, for example, water and juice, or water-based drinks, rather than carbonated drinks, as well as sandwiches and "healthy snacks", often prepared by the school kitchen.

3.11 The sale of items produced by pupils (in both primary and secondary schools) as a result of Enterprise in Education (E in E) activities was identified. One such activity in a primary school involved the design and production of bird tables. The children had formed a company, which included submitting application forms and attending interviews for the positions applied for, and then worked with a local authority technician to design and produce the tables. On his advice, they had made extra bird tables to sell to the local community in order to offset production costs. A loan had been obtained from the headteacher which was paid back as soon as the company was solvent. The bird tables had been advertised locally (with the pupils designing posters and contacting the local press) and all 45 tables made had been sold, resulting in "a tidy profit". The group of pupils had then used the money to finance 3 small compost bins and a weather station.

3.12 Other E in E activities reported included making and selling cards and gift tags, mugs, bird and bat boxes, friendship bracelets and a CD in aid of the Tsunami appeal. Another interesting example from a primary school was where P6 and P7 pupils had photographed, in four sections, a mural they had made and then made notelets which they sold in packs of 4 for £2. However, several interviewees were at pains to point out that E in E activities should not be seen merely as the sale of goods, but rather as enterprising activities which may or may not result in an end product, but which would always involve the acquisition of skills that would be "transferable and long lasting".

3.13 Other commercial product sales in both primary and secondary schools included the sale of items of school uniform where schools might make a small profit but, generally speaking, the intention was to offer parents a "good deal". The sale of school photographs was also prevalent, where the school would usually earn commission from sales. In one secondary school, the school received a CD of the photographs taken for use on its own computer system. In addition, interviewees in both primary and secondary schools highlighted the sale of fair trade goods, often linked in with work on citizenship. In one secondary school this activity was coordinated and run by the geography department.

3.14 Product sales identified mainly in primary schools included book-selling schemes, where the school usually received commission (either in cash or goods) on any books purchased, and catalogue sales at Christmas ( e.g. Webb Ivory) where, again, the school received commission on sales. Some selling of stationery was also reported in primary schools through contracts with recommended companies. Some occasional selling of cards and gift wrap was referenced, often run as a Parent Teacher Association ( PTA) activity, although an example was reported in one primary school of a parent selling cards they had made in school and subsequently sharing the profits with the school.

3.15 Finally, other activities referenced within the product sales arena included the letting of school facilities ( e.g. sports and community facilities); "spree" booklets (containing discount vouchers for exchange with local companies) in one secondary school; and a "bonus ball scheme" in one primary school tied in to the National Lottery, where parents pay monthly for a number and then any money from a win is shared equally between the parents and the school: "a tremendous fundraiser".

Direct advertising

3.16 The most common form of direct advertising within the schools in the sample, particularly at secondary level, was the sponsorship of school sports teams where companies' logo or name would then be displayed on the team strips, a "quid pro quo". Several headteachers noted that careful consideration would be given to any decision to accept such sponsorship to ensure that the company was reputable and, in some cases, to avoid being seen to favour one local company over another. Examples were reported where parents had a connection to a local company which resulted in sponsorship, but usually did not involve any logo or company name on the team strip. In one secondary school where this had happened, the company had been sent a photograph of the girls' netball team wearing the kit it had sponsored. A few primary headteachers indicated that they were not in favour of this form of direct advertising, preferring to acquire sports strips through the PTA or fundraising efforts:

"We haven't done that for a long time now. Since then we have gone through the PTA to buy tracksuits with no logo on, they have the school badge on instead. We changed because we're very wary about using company names or promoting a company, it's not really something we enter into. It's usually because we need something and I don't think that's a good enough reason sometimes. If we can buy it ourselves, or with PTA help, we don't need to then advertise anything. So we're kind of going down the road of not promoting anything, I don't like doing it unless I have permission to do so" (headteacher, primary).

3.17 In another primary school, free football coaching for P5 pupils was provided by a trained coach over a period of 8 weeks. The activity was sponsored by a fast food company and the bibs and water bottles provided for the pupils carried the company's logo. This was believed to be very beneficial, providing the pupils with quality coaching at no cost to the school. Interestingly, in another primary school where a similar activity had taken place, the local football team providing the training had been sponsored by the same fast food company, but the headteacher in this school had been "appalled" that the bibs provided for the pupils carried the company's logo.

3.18 The next most common form of sponsorship was of school publications. At secondary level only, interviewees referenced the sponsorship of school yearbooks (a record of a pupil's time at the school), in which local companies paid to place advertisements which then offset the publishing costs. In one secondary school the production costs of the yearbook were estimated to be £16 a copy. Sponsorship went some way to reduce the cost to pupils, but this was reduced even more through the proceeds of an annual school show, which resulted in the yearbook being sold to pupils at a cost of £8. Other school publications in which companies paid to advertise (at both primary and secondary level) included school magazines, newsletters, calendars and programmes for events such as school shows, fetes, awards ceremonies or sports days.

3.19 There were also examples, although almost solely within secondary schools, of companies providing advertising space in school, either on notice boards or poster sites. Schools then received a small income from displaying the advertisements. The one primary school in which this form of commercial activity was referenced had been supplied with notice boards in its dining hall, where posters advertising events and films were to be displayed. The school then, reportedly, received £10 for every poster it displayed, plus an extra £10 for any photographs of pupils looking at the posters. In one of the secondary schools in the sample, a community school, notice boards had been erected in the parts of the building used mainly by the public. In another secondary school, several companies had agreed to erect sponsorship signs along the edge of the school playing fields. School representatives commenting on this form of direct advertising were in agreement that any advertisements would have to fit in with the overall ethos of the school:

"To me, if they want to give me a couple of hundred quid to stick a sign up to advertise so that folk can see it, that allows me to get a set of football strips for my under-13s team, that's great. So, as long as I dictate the size of the sign and what goes on it and where it is placed, it is not an issue" (headteacher, secondary).

3.20 A slight variation on this, being discussed in one secondary school, was the possibility of setting up a local business directory website with an educational focus, to be implemented by a member of staff but with pupil involvement. The school would then receive revenue from the companies wishing to be included. At present, the school was seeking clarification from the local authority as to whether this would be an acceptable form of commercial activity.

3.21 Another form of direct advertising, but at secondary level only, was where company logos were evident on vending machines. Much less evident were logos in school canteens. A number of local authority interviewees did note, in line with the recommendations of Hungry for Success (Scottish Executive, 2003b), a move towards the de-branding of vending machines and, in some cases, their removal from schools. This was echoed by some headteachers in the sample who felt that the principle matched their own priorities:

"There are two hopes - one is that [the vending machines] will be de-branded in the short term and two is that we will eventually phase them out. De-branding is in the Executive's plans. We are going to be piloting work under 'Hungry for Success' for [name of authority] in terms of taking forward what they need to do for secondaries by 2007. We want to work with them because we are enthusiastic to do it, so their and our priorities are coming together (deputy headteacher, secondary).

3.22 In one authority, water coolers in its schools had, in the past, been sponsored by a variety of different companies. The authority had decided that this was not a viable approach and the provision had been changed, so that the water came from the mains supply and the coolers were no longer corporate sponsored. Pupils have drinking bottles that they can fill from the machines. The company supplying those bottles would have liked its logo on them, but the authority felt that this would not have been appropriate. As a result the bottles just have the council's logo on and "a message about water being good for you" (head of education services).

3.23 Isolated examples of direct advertising proffered by interviewees included the printing of lottery tickets for school events which carried the printing company's name, and in 2 schools, the use of a minibus displaying company logos. In one of them, a primary school, the minibus had been donated by a building firm constructing a new housing estate next to the school, which potentially would result in a lot more children coming to the school. The building firm provided the school and its neighbouring community centre with the minibus at no cost to either. At first, the company made enquiries as to how many pupils went out in the minibus and the sort of trips they made, "we presumed that was for their PR" (deputy headteacher, primary), but had since stopped enquiring. The other school, a secondary school, had benefited from the use of a minibus sponsored by a fizzy drinks company and a national newspaper, which had their logos on it. The school's name had been entered for a competition by a member of the public who was not a local resident and had no connection to the school. The school had won and, after some deliberation, had decided to accept the prize - the use of the minibus for a year.

3.24 Finally, in one secondary school, a computer suite had been provided by an energy company as a gesture to encourage community learning. The headteacher reported that the intention was that the local community would make use of the computers for evening classes, however, the school's larger computer suites tended to be used for these, so "the school had benefited hugely". A sign above the door to the computer suite was said to make it "quite clear" which company had provided the machines.

Indirect advertising

3.25 Voucher schemes emerged as the most commonly identified example of indirect advertising, particularly amongst the primary schools in the sample, with the majority of them (18) referencing this form of commercial activity, compared with 11 of the 28 secondary schools. Voucher schemes highlighted included those operated by leading supermarkets offering, for example, computer equipment and software, sports equipment and musical instruments. However, several secondary level interviewees in schools where this activity was not reported to be taking place, particularly those from more rural areas, noted that there were no large supermarkets in the area.

3.26 Also identified, but to a far less extent, was a scheme operated by a potato crisp manufacturer, and one by a leading confectionary firm, offering books in exchange for tokens on packets of crisps or bars of chocolate, as well as one operated by a washing powder manufacturer offering art and craft materials in exchange for vouchers. Interestingly, in contrast to the criticisms levelled at schools that were noted in the literature review for this study ( see Annex 1), most school interviewees were adamant that parents were not urged to buy more crisps, or chocolate bars, or to use the particular supermarket offering the vouchers - it was usually more serendipitous.

"I don't write to tell parents to shop there, I just say if you have any of these things, we would like to collect them. I would never encourage anyone to go there just to get things for the school" (headteacher, primary).

3.27 Such schemes were generally considered to be worthwhile, although a large number of vouchers were often required in order to obtain larger items of equipment such as computers. Equally, as one primary headteacher pointed out, if a computer was acquired in this way, their local authority would not provide the software, while a secondary headteacher bemoaned the costs of then having to maintain the computer. As a result, many school level interviewees reported that the school tended to collect vouchers towards smaller items, such as software, cameras, scanners etc. One advantage of these schemes was reported to be that vouchers could be "banked" for the next year if a school did want to collect for a larger piece of equipment.

3.28 The next most commonly referenced form of indirect advertising involved the donation of prizes by companies for school award ceremonies, or for raffles at school events ( e.g. a school fete). In several cases, it was reported that the company donating the prize would then be referenced in any printed literature about the ceremony or event, or in the school newsletter. However, a note of caution was sounded by one primary headteacher who highlighted the example of a local paintball company which had donated what, at first sight, seemed to be a generous prize of almost £100. In the small print though, the literature describing the prize announced that the £100 was a discount off the total bill and, in order to benefit from that, a total spend of about £500 would be required: "So we have to be pretty cautious about things like that - people wouldn't be too chuffed to win that prize".

3.29 Closely following the donation of prizes was the referencing of donations by companies of cash or gifts in kind. Examples quoted included:

• Cash from an environmental group to provide an artist to work on playground murals with children - the company then reported on this in its newsletter (primary).
• Children visiting a local cinema to participate in a fire drill for them and receiving, in return, a free showing of a film (primary).
• Juice for a fun run, fruit for older children from a local supermarket (primary).
• A laptop and colour printer donated by a large oil company (primary). A secondary school, a link school for the same company, receives financial assistance and matched funding for fundraising efforts and is currently being subsidised for a school trip to Ecuador.
• Cash from various companies towards the building of an adventure playground - those donating will then have their names on a plaque near the playground (primary).
• Free tickets for matches from a local football club, as long as the child is accompanied by a full-paying adult (primary). In a secondary school, complimentary tickets from a local football club had led to a member of staff now working with the club regularly on an anti-racism initiative.
• Cash from a local professional organisation to provide a gavel and lectern for the school debating society (secondary).
• Cash from local companies to provide a buffet at school events ( e.g. for careers evenings or awards ceremonies) - the company would then be referenced in any literature about the event (secondary).

3.30 An interesting example of the donation of gifts was provided by a deputy headteacher in one secondary school. Part of the school's catchment area includes an area where a large multi-national oil company has a gas fractionation plant. The gas coming into this would be split into its various component parts, which meant that the company had to "flare off" when too much gas came in. This resulted in "an unnatural ghostly light" over quite a large proportion of the school's catchment area. As part of their commitment to being good community neighbours, the company provided every first year pupil coming into school with a pencil case containing rulers, pencils etc. bearing the slogan: "[Company name] supporting community links". In addition, the company provided staff with a clock/calculator bearing the same slogan.

3.31 Sponsored schemes, projects or competitions were identified as examples of indirect advertising in several schools, particularly at secondary level. In one secondary school, a local professional organisation ran a "Euroscholar" scheme where a pupil would be sent across to Strasbourg to the European Parliament for a week. The scheme would be highlighted in the school newsletter, but the deputy headteacher felt that the benefits were more evident for the pupils than for the organisation involved. In another secondary school, sponsorship from local companies had enabled a second year group of boys to travel to Madrid for football training.

3.32 Other examples included a behaviour scheme in a secondary school sponsored by a local supermarket, and various projects, such as one where a secondary school had the use of a multi-media company's facilities and another involving CDT staff in a secondary school with a home furnishing retailer. The latter had resulted in the school receiving some technology equipment and the retailer then, "promoting themselves as a company involved in education and assisting the local schools" (sports centre manager, secondary). In another secondary school with its own "innovative" television station project, the school had received support from a national television company and funding from a local energy company to purchase equipment and training for pupils. More generally within this arena of activity, secondary school interviewees spoke of companies providing work experience placements for pupils. One secondary school interviewee highlighted a European work experience programme where pupils had the opportunity to undertake placements in France and Germany.

3.33 Sponsored educational materials, or SEMs, were frequently referenced. Textbooks, reading or maths schemes, photocopiable worksheets, teacher resource packs etc. were all said to carry the company name or logo, "probably the vast majority of teaching materials would fall into that category" (headteacher, primary). However, most interviewees saw this as being a fairly subtle form of indirect advertising and one of which the pupils would probably not be aware. At the same time, two secondary school interviewees were at pains to point out that any SEMs received would still have to fit with the school's values and curriculum priorities, otherwise they would not be used. Unsolicited SEMs were reported to be less likely to be accepted. Several interviewees referred to buying educational materials through an approved consortium, which was felt to provide schools with protection in terms of knowing that the required standards have been met.

"By having the goods in this catalogue, the schools get a sense of assurance and protection from people who are more experienced in that field pulling together items that will be of benefit to schools" (head of education services).

3.34 Another form of indirect advertising identified involved companies offering conferences for pupils, or companies and individuals coming into school to give presentations or provide workshops for pupils. The company name would then feature on any handouts or worksheets provided. In a primary school which was running a Health Week to introduce the pupils to a variety of healthy activities ( e.g. healthy eating, taking exercise etc.), a local bakery had come into school to show pupils a video about making bread and making healthier sandwiches. Each pupil then went away with a loaf of bread. The school had also involved a local butcher, dairy and fishmonger in the health promotion programme. Another primary school had involved a local felter and a jeweller in coming into school to provide workshops on their craft. In a secondary school, a large national bank had come into school to teach the pupils about managing their money. The indirect advertising here was clearly recognised by the school: "Obviously they are hoping the kids might bank with them in the future" (deputy headteacher, secondary).

3.35 Other examples of indirect advertising highlighted by interviewees included computers bearing company logos, the use of branded computer software, and grant applications to businesses where the company involved may receive some press coverage. Also included were examples of companies providing facilities for the school, for example building a nursery or creating a "trim trail" to encourage exercise, where the companies involved then referenced the work they had done in promotional literature.

3.36 Finally, an interesting example of indirect advertising was proffered by one deputy headteacher of how they had changed their more usual "passive" model of continuing professional development ( CPD), where the school purchased the services of a visiting speaker. A contract was arranged with a local book shop to allow members of staff to purchase between £50 and £60 worth of books from the shop out of the CPD budget, in order to keep up with their reading around their subject and wider educational issues.

"So money was going into a local business, the business was giving us a discount, we were furthering our CPD and it was a model owned by the staff, rather than imposed on them by outsiders".

Using schools for market research purposes

3.37 In line with the findings from the literature review ( see Annex 1), market research practices emerged as the least common form of commercial activity within the sample of local authorities and schools.

3.38 Local authority interviewees noted that, generally, approaches directly to schools would be discouraged. Equally, requests to the authority for schools to be involved in research for commercial companies were not likely to be approved, as this could be seen as providing an endorsement of their particular product. Some trialling of computer software, usually from reputable companies, was reported, but any request would be carefully vetted to make sure it was genuine. An example of "aggressive selling" was given by one local authority interviewee involving a software company which, after receiving a clear response from the authority that headteachers would make their own decisions to accept it or not, wrote to every school saying that the product had been approved by the local authority. Other local authority interviewees expressed similar reservations:

"Certainly if we as an authority were approached by a company wanting to use a school for that purpose, we would want to know what it was in aid of - whether it was genuine market research or whether it was covert advertising and promotion. We would only support it if it was consistent with our overall aim which is the improvement of youngsters' learning" (head of quality improvement service) .

3.39 Although not strictly market research, there were reports of local authorities usually supporting schools' involvement in educational research conducted by organisations such as the Scottish Executive and universities. A few secondary schools had been approached by students wishing to conduct research for their theses. A paragraph in one local authority's circular to schools states that research should have an educational theme and that permission to contact schools must first be sought from Education Services. The headteacher of a school would then make the decision whether or not to permit the research to be conducted in their school.

3.40 School representatives tended to concur with the local authority comments given above. Several spoke of having "reservations" or being "cautious" about agreeing to market research taking place in their school: "It's too easy for companies to phone up thinking they have a captive audience here" (headteacher, secondary). Receiving questionnaires through the post appeared to be fairly common, although in a number of cases, school staff reported that these tended to go in the bin if they were too time consuming. National surveys and requests from reputable organisations were more likely to be considered than those from commercial organisations: "We would remain very robust in rejecting anything that was more overt market research by a profit making company" (deputy headteacher, secondary). However, one headteacher described being involved with a local bakery that was thinking about selling lunch boxes to children and wanted to canvass pupil opinion as to what should be included in them. The pupils then received a sample of the end product. Other examples quoted of pupils completing questionnaires tended to be in-house ones, such as where to site bicycle stands in school, or whether pupils wanted an after-school club.

3.41 Contact from company representatives was reported in some cases and a few examples of the trialling of new educational products were given, but opinion was divided as to whether these should be accepted or not. For example, one primary headteacher reported inviting different company representatives into the school to discuss their products and then making a decision as to which one to order, while a secondary headteacher spoke of trialling software for a computer company which resulted in a discount for the school on the price and in another, a license for the school.

3.42 However, another secondary headteacher's response to approaches like this was more negative: "I'd be saying 'On your bike'. We're not a commercial enterprise at the end of the day, it's not what we're here for". A primary school had refused a request for staff to operate a purchase scheme for software with its parents because little was known about the company and it would have meant too much work. In fact, the company had given the impression that the request had been endorsed by the local authority, an assertion that was later found to be false. Another primary school had been asked to circulate information to parents about an educational programme for additional maths and language lessons. The school would receive a cheque in return for distributing leaflets and any orders placed, however, the headteacher had not been impressed with this approach and had refused.

3.43 School staff were very much of the opinion that any requests for the school to become involved in market research practices would need to be considered very carefully, especially where commercial companies were involved: "I always think 'Why would they want the school to be involved, why would we want to be involved with such a firm?'" (headteacher, primary).

Figure 3.1 Types of commercial activity identified by local authority and school personnel as currently taking place in Scottish schools (in rank order of the most frequently identified)

Source: Telephone interviews with local authority and school staff, and case-study work in the NfER study, 2005

Rationale for supporting commercial activity in school

3.44 School staff reported that rationales for the school's participation in commercial activity sometimes differed according to the particular activity concerned, but interviewees often stressed that their decisions were not usually driven by money. Rationales offered tended to cluster around the following (in rank order):

• To specifically benefit the pupils

"…to improve their knowledge of what is out there, we're really moving away from a knowledge-based society to a skills-based society, so the better informed these children are, the better equipped they are going to be when they leave school" (headteacher, primary).

• To provide some benefit for the school as a whole

"In each individual case, a headteacher would look at it and say 'Is there a benefit to my school in participating'" (headteacher, primary).

• To obtain funds for specifics e.g. needs driven

"We can do things we wouldn't otherwise be able to do. It allows us to use our devolved budget or educational supplies budget for aspects of the school that are more directly related to learning and teaching" (headteacher, secondary).

• That the benefits outweigh any costs/consequences

"Being perfectly blunt about it - that I get a heck of a lot more out of it than I put into it and the kids get an equal amount" (headteacher, secondary).

• That the activity fits with the school's ethos and values

"We felt it would fit in nicely with our health promotion ethos. Also one of the main aims of the school is to give the children as many different experiences as possible and where we're situated, it's a small rural town with not a lot of amenities and businesses, so we always try to bring people into the school as much as we can" (headteacher, primary).

3.45 Finally, only two interviewees intimated that the rationale for having vending machines in school was to generate income, while rationales offered by one interviewee each were that the commercial activity provided opportunities for staff development, that it brought skills into the school that were not currently in evidence, and that it increased efficiency ( e.g. as in the sale of school uniform). In this way, the majority view regarding the rationale for commercial activity in Scottish schools was that it was not because of budget constraints (unlike several of the US sources noted in the literature review - see Annex 1).

Consultation

3.46 School-level interviewees were asked if they had undertaken any consultation prior to agreeing to become involved in a particular commercial activity. A small number of interviewees referred to consultation with companies once the decision to participate in some form of activity had been taken, i.e. in relation to organisational issues. Amongst those interviewees that did refer to prior consultation, this was reported to take place most often with staff, with secondary level interviewees referring in particular to consultation with senior staff such as the senior management team ( SMT), in order to ensure that the proposed activity was appropriate.

"When companies want their logo on display, we do have discussions about what it acceptable. We don't want to be known as the Reebok High School or whatever. … There has been good discussion (deputy headteacher, secondary).

3.47 References to consultation with parents were also common, particularly if the proposed activity was likely to impact on them through their children. Two interviewees noted that parents were usually only consulted after senior staff, with one going so far as to say that if parents needed to be consulted then the activity was something the school should not be considering. Other interviewees preferred to keep parents informed throughout the consultation process, either through the PTA and/or school board, or by involving them in discussions alongside staff, "allowing staff and parents to shape the decision making is great" (headteacher, primary).

"We were asked once to put advertising hoardings on our playing fields which are in a prominent position. We put that out to consultation, to staff and parents, and it was a unanimous 'No way'. That was the only time" (headteacher, secondary).

3.48 Similarly, pupils were often consulted about proposed commercial activities, particularly through the pupil council, although two primary school interviewees also referred to a group called SNAG - the School Nutrition Action Group - involving parents, children and other members of the community. This meant that a wider group of pupils in school could be consulted because it involved, "different ones to those on the school council, so a lot more children are involved" (headteacher, primary). As the literature review for this study pointed out, a report published by Barnardo's (Ludvigson and Sharma, 2004) found that involving pupils in decisions about food was key to them making healthier choices.

3.49 Finally, one primary and one secondary school interviewee specifically stated that no consultation took place prior to becoming involved in commercial activity, while two secondary level interviewees reported consulting with the local authority. However, the latter was very much in terms of keeping the local authority up to date, or to check a particular issue, for example, a copyright issue.

"We've gone through the local authority to keep them informed. It would be fair to say we've taken the lead here - this is not driven by the local authority, it is supported by them, but we drive it because it is part of our philosophy" (deputy headteacher, secondary).

Financial issues

3.50 School-level interviewees were asked to consider the financial issues associated with commercial activity, in particular how much money was generated by such activity (as a percentage of the school budget) and where any money generated was spent, for example, whether it went to provide improved resources for the whole school population, or was directed towards particular pupil groups.

The amount of income generated by commercial activity

3.51 Interviewees were asked about the income generated by commercial activities, and to express this in terms of a percentage of the school budget, if possible. The most common response to this question was to emphasise that the total amount was particularly low: diminutive phrases such as "very, very little" and "peanuts" surfaced regularly, with secondary school representatives, particularly, sometimes offering descriptors like "infinitesimal", or "negligible". One secondary headteacher summed up the amount as "nothing in terms of the overall school budget", and another as "a spit in the ocean". Actual estimated percentages ranged from one per cent or less to "5 per cent, if that". Some respondents offered actual monetary figures: here, the range of responses was from under a thousand ("it's hundreds, not thousands") to £5,000. One secondary school noted a £20 to £30 daily profit from its tuck shop.

3.52 Five respondents (3 primary and 2 secondary) indicated they "did not know" or that it was "impossible" to state the amount generated. Some interviewees noted that "in kind" income and sponsorship made such calculations difficult and a number of responses highlighted receiving proportions of the total monies raised through such activity as photograph and uniform sales or other non-specific fundraising activity. Interviewees also often stressed that profit or income generation was not the purpose (or in some instances, the outcome) of any commercial activity. Comments of this ilk were particularly noted from secondary staff and included "we don't make money" and "we don't need the money, "it's not an income we rely on in any shape or form. If commercial income comes in, it's a bonus." Thus, the very modest - and largely non-essential - nature of income generated by commercial activity emerged as a predominant viewpoint from the primary and secondary schools in the sample.

Where the money generated by commercial activity is spent

3.53 Interviewees were also asked to specify where commercially generated income was spent. The highest ranking response was to state non-specifically that it went into the school fund ("the school's own money"). Subsidising school trips (including outdoor and cultural activity) and associated transport was the next most frequently identified usage, with references to helping low-income pupils in some instances. Rurality and the associated costs of transportation were sometimes noted here. Primary schools also reported spends on technical equipment (such as smartboards and computers) and books more often, while secondary respondents uniquely highlighted directly funding prizes and awards (including rewards within the school's behaviour management scheme), sports equipment and reinvestment in yearbooks, planners and school magazines. Reinvesting book club monies into purchasing more books was also noted by several interviewees.

3.54 Individual schools referenced subsidising Christmas parties and visits to the school by a choir or theatre company. A further response was to indicate that decision-making on spending income was decided by pupils, staff or that such funding was "spread around the departments". Again, overall, interviewees often noted that income was spent for the "direct benefit" of pupils, stressing it "supported pupil activities" and "enhanced the curriculum". In this way, the educational merit and worth associated with the actual financial outcomes of commercial activity was emphasised.

3.55 From an economic perspective, the targeting of the additional income, in some cases, to providing for disadvantaged children demonstrates that the extra resources generated by commercial activity may be used by schools to address their own priorities. Although the amounts may be relatively small, the decision on how to allocate these resources is entirely at the school's disposal and may represent a useful tool in addressing very local needs.

Plans to extend/reduce the amount of commercial activity currently taking place

3.56 When asked whether commercial activity was to be expanded or reduced, the majority response from both primary and secondary interviewees was that it would stay at current levels, with at least twice as many school representatives reporting no plans for expansion currently, compared to the numbers suggesting they would be looking to increase their involvement. Thus, typical comments included "we've no plans to expand at present", "the level is OK for now". Some schools did however indicate they were embracing expansion, with comments such as:

"I think we should be trying to expand. With our business manager coming back, we would be looking at trying to get other sponsorship deals, we'd be certainly wanting to look at local and national firms assisting in quite defined projects, not just giving us money (headteacher, primary).

"We're going to try and acquire sponsorship … beyond that, there will be grants and awards we apply for, that we may need to match funding for. We will look to see where that can be derived from" (headteacher, secondary).

3.57 By and large, comments indicated that the rationale for schools wanting to expand sponsorship was to support specific projects ( e.g. to create a garden area) or to meet demand ( e.g. to acquire a new strip for the school football team), but also to increase the involvement of local businesses in schools for the benefit of the pupils, "to try and give as many different experiences to the children as possible" (headteacher, primary).

3.58 Others highlighted further involvement in enterprise activity and particularly with local businesses. A third type of response was to indicate a certain "serendipity" or responsiveness surrounding the amount of activity undertaken, dependent on availability or suitability of sources of funding. Hence, no actual "policy of expansion" was indicated. Nevertheless, schools clearly were taking different stances about seeking out opportunities for sponsorship - "we don't go out looking" from one respondent compared to the comment "we're always looking for money". Finally, two of the school interviewees did relate expansion to budget: "no [expansion,] unless the budget is cut" was one secondary response, while a primary representative noted that "the budget has been reduced quite a lot so we might be looking for funding".

Summary

• Local authority staff reported that the extent of commercial activity taking place in schools was limited and varied across local authorities. However, perceptions were related to individual interpretations of what such activity constituted, as well as the particular role of each interviewee. School staff noted that commercial activity had existed in some form or another, albeit small scale, for a number of years.
• Product sales identified by interviewees most commonly included the sale of food and drink through school tuck shops, canteens and (mainly at secondary level) vending machines, followed by the sale of: items produced by pupils as a result of Enterprise in Education activities; school uniform; school photographs; books and catalogue goods; and stationery.
• Direct advertising most commonly involved the sponsorship of school sports teams where companies' logo or name would be displayed on the team strips. Other forms of sponsorship included school publications such as school yearbooks, magazines, newsletters, calendars and programmes for school events in which companies paid to advertise. There were examples in secondary schools of companies providing advertising space in schools ( e.g. notice boards and poster sites), as well as logos on vending machines or water coolers. Isolated examples included the printing of lottery tickets with the company's name on and donations/prizes bearing the corporate name/log, e.g. a minibus and a computer suite.
• Within the arena of indirect advertising, voucher schemes ( e.g. for computer, sports or musical equipment, or books) were most commonly identified, followed closely by the donation by companies of prizes for awards ceremonies or school events, and the donation by companies of cash or gifts in kind. Other forms of indirect advertising included sponsored schemes, projects or competitions, sponsored educational materials ( SEMs), the provision of conferences, presentations or workshops for pupils, branded software in school, grant applications to businesses and a contract with a book store to allow staff to purchase books through the CPD budget.
• In line with the findings of the literature review, market research was the least common form of commercial activity in schools. Approaches directly to schools were likely to be discouraged, as were requests for schools to be involved in research for commercial companies. Schools' involvement in educational research for reputable organisations and universities was usually supported. Some trialling of computer software and/or new products was noted, as was some research activity by pupils, usually as part of enterprise activity.
• Rationales for Scottish schools'involvement in commercial activity sometimes differed according to the activity, but were not generally related to budget constraints, unlike several of the US sources referenced in the literature review ( see Annex 1). The majority view was that they were: to benefit the pupils, to provide some benefit for the school as a whole, to obtain funds for specifics (needs driven), that the benefits outweigh any costs/consequences, and that the activity fits with the school's ethos/values.
• Consultation prior to becoming involved in commercial activity took place most often with school staff, particularly, at secondary level, with senior staff. References to consultation with parents were also common, as were references to consulting pupils, particularly through the pupil council. Two school interviewees stated that no prior consultation had taken place, while two reported keeping the local authority "informed".
• The income generated by commercial activities was reported by school interviewees to be low, particularly in terms of the overall school budget. Some stressed that income generation was not the purpose of any commercial activity. When asked where such income was spent, the highest ranking response was into the school fund. Subsidising school trips was the next most often identified usage, while some interviewees referenced specific items such as technical equipment, books, prizes and awards, sports equipment and reinvestment in yearbooks, planners and school magazines. Overall, interviewees stressed it was used for the direct benefit of the pupils.
• The majority of interviewees reported that commercial activity was likely to stay at current levels, although some did indicate that they were embracing expansion. Others highlighted further involvement in enterprise activity and particularly with local businesses, while another response was to indicate responsiveness depending on availability or suitability of funding. Finally, only two school interviewees related expansion to budget, i.e. if this was reduced they would be seeking funding.

CHAPTER FOUR: THE BENEFITS AND COSTS/CONSEQUENCES OF COMMERCIAL ACTIVITY IN SCHOOLS

Introduction

4.1 The engagement of a school in any particular commercial activity may lead to a range of benefits and consequences incurred by the school itself, including school staff, pupils and parents, that would not have occurred had the school not engaged in that activity - these incremental costs and benefits are the effect of the commercial activity. Depending on the particular activity, these costs and benefits may take several forms and be distributed unevenly across the population of pupils, as well as having various stakeholders, such as the schools and businesses involved in the activity. For example, vending machines may provide monetary benefits in the form of cash income for a school, but they may also have an additional non-monetary benefit by encouraging school pupils to stay on the school premises.

4.2 Conversely, if vending machines have encouraged additional consumption of soft drinks by pupils (above and beyond what they would have consumed without the vending machines), then there may well be additional costs: to the health of individuals; behaviour in class; incidences of bullying; etc. Not all activities which increase consumption of a good necessarily lead to increased costs, it will depend entirely on the nature of the good. For example, if book clubs lead to increased reading by children then this effect may be viewed as an additional non-monetary benefit. However, an important consideration in discussing the costs and benefits of commercial activity is that not all benefits and costs may be easily identified and/or valued in monetary terms, or other single measures. A full discussion of this economic perspective can be found in Annex 2.

4.3 Interviewees were asked to give their thoughts on the benefits associated with schools' involvement in commercial activities in terms of benefits to schools and businesses, as well as to pupils, school staff, business staff and parents. Interviewees were also asked to identify any possible cost or consequences as a result of institutions and/or individuals being involved in commercial activity, and what steps they had taken to identify those costs. Interviewees' thoughts on whether it was easier to identify the benefits rather than the costs of commercial activity and what they would consider to be unacceptable commercial activity were also explored. Where evidence suggested sub-samples' different and/or additional perspectives these are highlighted in the text.

The benefits to institutions

Benefits to schools

4.4 The most commonly identified benefits for schools regarding their involvement in commercial activity were, in rank order:

• Materials/equipment/prizes/trophies
• Enhancement of the curriculum/learning environment
• Financial benefits
• Partnership/links with business
• Community engagement/links
• The promotion of a school ethos/identity and parental engagement
• Advantages associated with the social milieu of vending machines.

4.5 Commercial activity was seen as allowing schools to access resources they would not be able to buy otherwise and enabling them to purchase materials, resources, facilities and/or experiences over and above what they would normally be able to access. This benefit was nominated by a slightly higher proportion of secondary interviewees than primary interviewees (half compared to just over a third). Primary schools had used supermarket voucher schemes to access additional ICT resources such as computers, software, and digital cameras: "We would never have been able to afford another laptop or a new printer" (headteacher, primary). Thus, commercial activity was seen as providing additional facilities to enhance existing resources - for example, book sales in primary schools provided additional books for the library.

4.6 For the small number of schools that had been able to access substantial pieces of equipment such as minibuses, the benefits were seen to be immense: "We can provide them [pupils] with all sorts of experiences that we couldn't possibly afford to do [otherwise]" (deputy headteacher, primary). In both primary and secondary schools, using commercial activity to provide football strips, prizes and trophies meant that schools did not have to spend limited resources of their own. A property of these type of benefits is that they tend to be tangible: easily observable with a monetary value indicated by their purchase price in the open market. That they are listed as the most common benefit may be due to their highly observable nature which, not only makes them less likely to be missed if they occur, but possibly also more likely to take place in the first place.

4.7 Enhancement of the curriculum/learning environment was the second most commonly identified benefit, emphasising the non-financial benefits associated with schools' involvement in commercial activity. Interviewees primarily focused on the expertise that commercial activity and business links could bring into schools. These benefits were often linked with national initiatives, such as Enterprise in Education ( Determined to Succeed), or health promotion ( Hungry for Success). This benefit of involvement in commercial activity was more likely to be highlighted by secondary interviewees, for example the use of a management consultant, "a high quality person, who, as a school we wouldn't have been able to afford" (headteacher, secondary), but was also acknowledged by primary respondents as well, "it's a great way to get experts in" (headteacher, primary), gaining from knowledge and expertise that teachers would not possess. Although the value of the expertise may be unknown, the market cost of bringing in an expert may be better known. Thus, although the true benefit of such expertise may be non-monetary, some respondents and decision makers have indicated a means of attaching a monetary value to the provision. Again, that there is a market-provided value for experts may partly explain the prevalence of this reported benefit.

4.8 Interviewees also acknowledged the additional funding/direct financial benefits that could result from their involvement in commercial activity. Whilst these activities ( e.g. the sale of uniform, school photographs, and income from tuck shops) raised relatively small amounts of income, they allowed schools to then purchase additional materials, resources, facilities and experiences. Some schools were selling their own products e.g.CDs, crisps, water etc. which also meant that the commercial activity was firmly embedded within the enterprise culture within school. A small number of local authority and school interviewees highlighted how local authority purchasing schemes offered schools protection from "rampant" commercialism and provided them with 'best value' options. This was seen as beneficial for the school because the local authority carried out all the investigations into the appropriateness and value for money of the commercial links established.

4.9 For schools, commercial activity was also seen as providing valuable links and partnerships with local businesses and the local community. In rural areas in particular (although equally applicable to urban environments), it was seen as helping to focus on building successful and sustainable communities. It was felt that commercial activity within the school helped to highlight to pupils that there were opportunities for them within the local community, that there was a need to keep financial resources within the local community and that the school played an active part in the long-term viability of the local community. The provision of links and partnerships with local businesses was seen as a vital part of that sustainability. It provided pupils with opportunities to experience 'real life' commercial activity but was also seen to bring the community into the school, thus moving from a focus on enterprise to citizenship.

4.10 In some instances, (at the secondary level in particular), commercial activity was seen as helping to develop more positive relationships between the school, the local community and local businesses "it is good for the image of the school to be in touch with the local community … it says something about the school not working in isolation" (head of schools). For example, a local supermarket sponsoring a secondary school's achievers award was felt by the school to help deter pupils from causing disruption at the store because pupils knew they were involved in the school, which had resulted in "more positive and constructive dialogue between 2 community partners: schools and local businesses" (deputy headteacher, secondary). Thus, building relationships and links with local business was seen as mutually beneficial for both the school and the company. This is another example of a, primarily, non-monetary benefit. However, unlike the provision of experts, where presumably there exists a market price for their hire, there is possibly less scope for determining a value in such a manner for this benefit.

4.11 A small number of school interviewees also highlighted how commercial activity may help promote school ethos/identity. This was cited mainly in relation to the sale of school uniform. Interviewees contended that, if the school wanted pupils to wear school uniform and to have all the attendant benefits associated with that, such as pride in the school/enhancement of the school identity, they had to sell it themselves. A number of schools were sole stockists of uniform as no local outlets were available, but interviewees also pointed out that they were able to sell uniform cheaper than commercial companies. Supplying school uniform was seen as beneficial to the school:

"If you do it yourself, there's an enhanced prestige in the school and an enhanced motivation and pride in the kids" (headteacher, secondary).

4.12 Commercial activity was also seen as promoting parental engagement in the school, this was identified by local authority and primary school interviewees only. Examples included parental involvement in voucher schemes or more direct involvement in the school via their business links. This was seen to help enhance engagement with the local community and ensure that parents were involved in helping shape the ethos/identity of the school. One local authority interviewee defined it as "parents feel they are making a direct contribution to the school" (head of schools). Furthermore, as one primary headteacher observed, they supported commercial activity that was important to families of the school, for example the sale of school uniform, but beyond that they were unlikely to be involved. Commercial relationships were also being used to promote and reinforce school policies regarding attendance and one primary school was working with a local travel agent to encourage parents to take their holidays during the school holidays.

4.13 A small number of interviewees highlighted the advantages of the social milieu provided by vending machines, in that they helped retain pupils in school during dinnertimes and breaks: "it's a way of retaining pupils in school rather than having them going to the local shop" (head of schools), or that they alleviated pressure on overcrowded accommodation within the school at these key times. Pupils from one secondary school reiterated this view, saying that they did not feel the need to visit the local shop at lunchtimes because they could buy the same goods in school.

Benefits to businesses

4.14 The most commonly identified perceived benefits to businesses of involvement in commercial activity were, in rank order:

• Community engagement/links/partnership
• PR/sales
• Training opportunities.

4.15 Altruistic and commercial motives were generally not seen as mutually exclusive by interviewees. They acknowledged that businesses may seek to develop community engagement and links, to show that they were not an "uncaring multi-national" and that they were more than a commercial organisation. Thus, commercial activity e.g. via sponsorship could be seen as "more of a community gesture on their part rather than a commercial one" (headteacher, secondary). The involvement of some of the large multi-nationals e.g. the oil companies, was seen to reflect and enhance their "corporate social responsibility" programmes and interviewees acknowledged that this may be part of a local community damage limitation exercise. Thus, the other main benefit for businesses identified by interviewees was that commercial activity was seen as a good PR/marketing opportunity, whether that was increasing their product awareness or showing the company in a positive light. The PR/marketing was usually fairly low key, for example, a mention in the school prize giving programme or school newsletter, although there was an example of a company which had sponsored a minibus and the firm's name was on the side of the minibus.

4.16 However, interviewees also acknowledged that businesses and their employees (see individual benefits) benefited greatly from being involved in schools, in terms of learning new skills, in new contexts, developing relationships with young people and the school, and increasing their awareness and knowledge of how education operates. As one interviewee noted, local companies enjoyed being involved in the school, they felt part of the school and because that relationship was established they felt they could contact the school if pupils were causing them any difficulties in the community. Conversely, the school felt able to ask the businesses to provide work experience opportunities for its pupils or to sponsor prizes. Commercial activities were seen to be bringing the school and the community/businesses together and increasing their "tolerance" of one another.

4.17 School representatives also pointed out that, through commercial activity, businesses could also seek out a potential workforce who were ready for the world of work and that their involvement meant that they could access appropriately trained employees or could 'pick and choose' prospective employees. Thus, through commercial activity, businesses were actively engaging with schools to seek out a skills-based workforce and/or to plug the skills gap. Similarly, commercial activity provided training and staff development opportunities for company staff e.g. conducting mock interviews, presentation skills, at a relatively low cost.

The benefits to individuals

4.18 Interviewees were asked to identify the main benefits for individuals involved in commercial activity. The main benefits identified focused on those for pupils, but interviewees also noted some benefits for school staff, business staff and parents.

Benefits for pupils

4.19 The most commonly identified benefits for pupils were, in rank order:

• Pupils' increased understanding of the commercial sector
• Enhanced facilities, equipment and experiences
• Sponsorship/business involvement which brings relevance to pupils' learning
• Enterprise skills/activity
• Health-related benefits
• Employment opportunities
• Enhanced identity
• The encouragement of team work
• The encouragement of reading
• Choice for pupils.

4.20 The main benefits of commercial activity for pupils identified by interviewees (both school and local authority) were, primarily, that it resulted in pupils being better informed about the commercial sector, that it gave them an understanding of the value of money, enterprise etc., but also that it brought relevance to their learning. Thus, commercial activity was seen as developing children's confidence and skills in dealing with the outside world and an awareness of enterprise, for example through running a tuck shop in primary school they were developing an awareness of profit and loss. Commercial activity was seen as providing pupils with opportunities for real world experiences of the market economy and to gain an understanding of how it operates, taking them out of the relatively cloistered environment of school. It was also seen as providing pupils with insights and inspiration: "I can do that … I've talked to this guy I know how he did it and I know how to go ahead and do it" (headteacher, primary).

4.21 Through involvement in fair trade activities, pupils were also gaining an understanding of world trade, developing countries and "third world issues", as one local authority interviewee put it. Thus, pupils were developing an awareness of company motives and gaining insights into how commercial activity operates, as well as how their consumerism impacts on others. Interviewees felt that pupils were better informed as a result of this and that it put them in touch with the 'real world': "It gives them the skills to assess advertising and marketing so they can make better choices" (headteacher, primary). In terms of bringing relevance to pupils' learning, interviewees suggested that their involvement in commercial activity made them more confident and better prepared for modern life ('education for work') and that it was a boost to pupils' confidence to see companies interested in them.

4.22 Opportunities to provide enhanced facilities, equipment and experiences have already been discussed in benefits to the school, but interviewees also highlighted the benefits of these opportunities to individual pupils, enabling them to access opportunities, for example trips abroad via commercial sponsorship, that they would have been unable to undertake otherwise, or the opportunity to use the best sports equipment available. This was felt to lead to enhanced social equity because all pupils were able to participate rather than only those whose parents can afford it.

4.23 Enterprise skills and activities were providing pupils with insights and skills which may not be directly available from the curriculum, such as involvement in media activities and the production and marketing of a CD. Alternative curriculum options made available by commercial activity were seen as benefiting disengaged pupils in particular, teachers reported improved behaviour and concentration. Pupils were also surprised "how nice people in business are to them" (business development manager, secondary) which helped break down barriers and establish positive relationships between companies, the school and the local community but also made them feel valued: "They can see that local firms are interested in them" (deputy headteacher, secondary). Commercial activity also provided pupils with employment opportunities, either by opening up ideas to them of possible employment opportunities, or companies working with the school actually providing them with employment when they left school.

4.24 The switch to vending machines with healthy options, the establishment of healthy tuck shops, and vans selling healthy foods meant that commercial activity could be linked with health-related benefits and there were claims of improved pupil behaviour as a result of these changes in some schools. Primary school and local authority interviewees hoped that health awareness promotion would have a positive impact on pupils' diets, although they acknowledged that they were still at the early stages.

4.25 A number of benefits for pupils were only identified by local authority interviewees, these were:

• The benefits associated with team working, through enterprise activities
• Enhanced identity associated with new football strips
• Book sales encouraging pupils' reading
• Vending machines providing pupils with more choice.

4.26 The benefits for pupils (identified by pupils), focused on better equipment, facilities and experiences, for example ICT and outdoor play equipment, that was available to them, as a result of their school securing sponsorship from the commercial sector. Primary pupils commented that improved facilities in the playground gave them "more variety and choice of what you get to do" making school a "better place", whilst in the classroom laptops and smartboards were seen to improve their learning experience. Pupils commented that they felt they had a better understanding of the commercial sector and how business works, including an appreciation of fair trade activities and how their purchasing patterns may impact on others. They also felt that they had learned new skills for example via securing sponsorship or being involved in an enterprise activity. Pupils from one primary school observed that relationships between pupils and local businesses had improved, "they give us more trust".

4.27 In one secondary school, pupils highlighted the additional learning opportunities that had been made available for pupils, staff and the local community via an award from a national bank to fund the provision of sign language classes. It was felt that the classes had resulted in reducing the isolation and segregation of hearing impaired pupils and their families by enabling more effective communication between the hearing impaired and the hearing, both within school and the local community. Finally, pupils in one secondary school commented on the financial benefits associated with commercial activity, which meant that certain aspects of extra-curricular activities, such as transport to sports matches, was provided free of charge.

Benefits for others (school and business staff, and parents)

4.28 Fewer benefits were identified for others, but those that were, were seen to have impacted significantly. The main benefits identified were enhancement to teachers and business staff learning via involvement in commercial activity, for example, teacher secondments to businesses and company staff gaining expertise via involvement in enterprise activities:

" It is good for teachers to be out seeing a different aspect of life … seeing something put into practice. It enhances their teaching when they come back and shows how what they are doing is important in the wider world" (deputy headteacher, secondary).

4.29 Teachers' understanding of the commercial sector was seen to have been enhanced and business staff were also gaining insights into the operation of the educational sector. Links with a local football club had led to a member of school staff working at the club, as a primary teacher observed: "It makes me more knowledgeable, I'm learning as well". Interviewees also referred to the enjoyment business staff experienced when they were involved in the school and the opportunities it provided for them to learn or develop skills, for example, in interviewing and presentation skills. Furthermore, school staff were seen to be benefiting directly from improved facilities and better equipment in the school as a result of commercial activity. Improvements in children's learning from healthy eating interventions were also identified.

4.30 For parents, the main benefits identified by interviewees focused on providing them with essential items they required, i.e. school uniform at a reasonable cost and making it easily accessible at the school. This was seen as being mutually beneficial for both the school and for parents. For those parents who had business links with the school, it gave them the opportunity to be involved in their child's school and contribute and enrich the learning environment as already highlighted, but also that parents enjoyed being involved in the school. Voucher schemes were also seen as a way of improving parental and pupil involvement in the school giving them "the idea that their actions can invest in, contribute to the school, and not just that the school affects them" (head of education).

4.31 Parents were also being given opportunities to use and gain an understanding of the improved facilities/equipment e.g. smartboards that their children were using. Throughout, interviewees were emphasising the mutual benefits associated with commercial activity i.e. for the school, the business and the individuals involved. Thus, mutuality was an important aspect of the commercial activity in which schools were engaging.

The costs to institutions

4.32 The costs or consequences identified by interviewees in relation to institutions, primarily focused on the costs to schools. Interviewees found it difficult to identify costs for the businesses involved, apart from staff time, because they felt if there were costs for the companies, they just would not get involved.

Costs to schools

4.33 The most frequently mentioned costs to schools, identified by interviewees (school and local authority interviewees), in rank order, were:

• Staff time/administrative costs
• Compromising or conflicting values/policies
• Health of pupils
• Over reliance on funding
• Lack of choice in facilities/equipment provided
• Maintenance of the equipment donated
• Liability for promotion
• Being in breach of code of conduct/financial regulations
• Parents perceiving a lack of funding in the local authority
• The need for the school to match funding.

4.34 It should be noted that these were often potential costs, rather than actual realised costs. From an economic perspective, it would be supposed most schools would only undertake those activities for which they perceived the expected benefits to outweigh the expected costs, and so the self-selected nature of the activities undertaken would lead us to expect schools to report costs not outweighing benefits. This expectation is fulfilled, as most interviewees in the current study were adamant that the way they operated commercial activity did not result in the costs outweighing the benefits.

4.35 Overwhelmingly, the 2 most common costs identified equally by interviewees were, staff time and the possibility of commercial activity compromising the values of the school or local authority. Interviewees felt there was a cost in terms of staff time, for example in seeking out, developing, establishing and maintaining commercial links and that much of this was done by staff out of school hours ( see Annex 2 for further discussion of time cost). One secondary headteacher contended that it was not cost-effective for senior managers in secondary schools to be running commercial activities. A number of school interviewees also commented that they wasted a great deal of time dealing with commercial representatives trying to sell them products.

4.36 In relation to the collection of vouchers, a number of primary school interviewees noted that they tried to minimise the cost of staff involvement (in terms of workload and time) by asking pupils to count vouchers, which also meant that pupils were taking on extra responsibility, learning new skills and taking ownership of choosing the equipment that the school received. However, whilst school interviewees acknowledged that there was a time cost for staff involvement in commercial activity, most contended that the benefits outweighed the costs and that, if this was not the case, they would not agree to involvement.

4.37 Interviewees acknowledged that there was also a time cost for the businesses, but again contended that companies would not be involved if they felt the costs outweighed the benefits. Costs, in terms of time, were more likely to be identified by primary school respondents (over half), compared with just over a quarter of secondary school interviewees. This perhaps reflected the smaller numbers of staff in primary schools where commercial activity might become a workload issue as tasks cannot be delegated to the same degree.

4.38 Compromising or conflicting values and/or policies of the school and/or the local authority by product promotion or endorsement was viewed as the other potential cost of involvement in commercial activity, one that is both difficult to measure and difficult to value in monetary terms. Interviewees felt that it was unethical for schools to be seen to be endorsing particular products: "We are in the business of educating people rather than selling to them I suppose" (headteacher, secondary), particularly those products that might have a detrimental impact on pupils' health. The issue of fast food companies sponsoring football training and providing bibs and water bottles with their logo on was felt by some interviewees to compromise their integrity, particularly when they were a health promoting school. Local authority interviewees reiterated these concerns:

"Chocolate manufacturers and manufacturers would like to get into schools but we would find that difficult to justify. It presents a dilemma when they try to do it by the back door e.g. offering sports equipment for schools if you collect lots of bags of crisps. We would have some kind of moral debate about whether that was an ethical thing to do" (education services manager).

4.39 Interviewees also felt there was an issue that, through commercial activity, schools may lose (or be in danger of losing) their impartiality, resulting in being "controlled for commercial gain in a way you wouldn't want to be" (deputy headteacher, secondary). Consequently, concerns were raised regarding issues of exclusivity in relationships with firms, lost opportunity costs and thus possible lack of choice if schools were tied into a relationship with a particular firm (this was generally theoretical rather than actual). A slightly higher proportion of secondary school interviewees identified this cost than did primary interviewees, perhaps reflecting the issue that secondary schools as larger consumers are more likely to be targeted by 'hard sell' approaches from larger commercial companies. Again, interviewees emphasised that they always weighed up the potential costs before entering into a commercial relationship and would not be involved in anything unethical, harmful or dangerous. They were aware that this could be an issue but they ensured that it did not happen.

4.40 Health concerns associated with commercial activity, primarily vending machines, but also sponsorship by crisp, chocolate, fast food and fizzy drinks manufacturers, were identified by interviewees as a cost (or a potential cost) for schools. Local authority staff in particular raised this as an issue, reflecting a focus on the Hungry for Success initiative. School interviewees also identified costs associated with fast-food vans trading outside the school gates or in the school grounds. One school had reluctantly allowed a van into the school grounds because of the health and safety issues associated with pupils crossing a road to use the van. They had then allowed a van selling healthy food to come and park centrally in the school grounds, whilst the one selling unhealthy food was positioned as far away from the school as possible.

4.41 Another school had been involved in giving out vouchers for a fast food outlet but had stopped this practice because of the health issues and because they felt they were promoting this company over others. Interviewees held conflicting views as to whether health promotion and the consequent removal of 'unhealthy' vending machines and their replacement with 'healthy' machines would have a financial cost for the schools involved in terms of lost revenue. Generally speaking however, the vending machines were operated by authorities' catering services and as such, schools in the sample did not receive a share of the profits. Of those that did, the amounts reported were small. One headteacher felt that for the amount of trouble the machines caused, the revenue received (£3,000 a year) was not worth the effort. However, the vending machines fulfilled another function in this school by filtering students away from the very congested dining area: "I would have them out tomorrow if it weren't for the lack of space for the youngsters" (deputy headteacher, secondary).

4.42 It was also felt that schools could possibly become over reliant on company sponsorship, which could be problematic if they subsequently lost that funding. Interviewees noted the need to explore a range of funding opportunities so that sponsors did not experience funding fatigue. Company expectations of schools once they were in receipt of funding were generally not felt to be particularly onerous, for example, it might involve having a photo in the local paper, or in the company or school newsletter. However, one interviewee did feel that company expectations were not always realistic and that they often wanted children to produce paintings and drawings that were not linked to the curriculum, which could become onerous for the school. Where these misunderstandings arose, it was often felt to be because the companies lacked an understanding of the workings of schools. Other interviewees also commented on this in terms of businesses not understanding about the time constraints placed on staff and pupils in school.

4.43 The other issue identified by school interviewees was that, through sponsorship and donation, the school may not receive the equipment they wanted but felt that they had to accept what was offered, for example, the sports kit provided may not have been what they would have chosen. There was also a feeling that, with local authority purchasing schemes, schools did not always receive best quality, or that they did not receive best value either and that they could source better ICT equipment themselves. However, interviewees also acknowledged that had to weigh this against the protection they received by being involved in a local authority scheme.

4.44 The maintenance of the equipment donated was also identified as a possible cost, mainly by local authority respondents, although it was also referred to by one school interviewee. Other additional costs for schools, identified by individual local authority respondents, focused on the following scenarios:

• Schools could be liable for the promotion of commercial activity and that if anything went wrong they may be sued (as had happened in one authority)
• Schools might be in breach of their code of conduct and/or financial regulations (probity) via sponsorship
• Parents might perceive that there was a lack of funding in the local authority if they saw the promotion of commercial activity such as voucher schemes
• Funding might only be available if schools were able to match it.

Costs to individuals

4.45 The costs to individuals identified by interviewees reflected those identified for schools. They were, in rank order:

• Health of pupils
• Pupils' over exposure to/representation of certain products
• Staff time
• Pressure on parents (pester power)
• Exploitation of children

• Pressure on pupils to participate in voucher schemes or to buy products
• Lack of protection for staff
• Financial costs
• Bullying.

4.46 The main costs for individuals identified by interviewees (as with the main benefits) focused on pupils. When interviewees (school and local authority) were asked to identify costs associated with commercial activity, the most common response was the detrimental impact that the sale of unhealthy foods in vending machines and tuck shops had on pupils' health. Interviewees were positive about the removal of vending machines or switching them to healthy alternatives. Local authority interviewees were most likely to identify this as a cost. Linked to this were concerns that through commercial activity pupils may become over-exposed to certain products, such as fast food and that pupils may be exploited by a blurring of the curriculum and sponsorship.

4.47 Interviewees felt that via commercial activity, schools may be in danger of using, or appearing to use, children to advertise companies which was viewed as unethical. It is worth revisiting the perceived influence that Hungry for Success has had on the decisions made by schools, in that a number of them reported that they had debranded or changed the contents of vending machines, or were in the process of doing so, as a result of the guidance provided.

4.48 The issue of staff time for developing and maintaining commercial activity again arose as a concern for the individuals involved. Staff were also felt to be potentially vulnerable in terms of the lack of protection afforded to them when they were involved in commercial activities. There were concerns that headteachers were at risk of 'hard sales' techniques and that they risked possible involvement with unethical companies when their unethical stance may be well hidden.

4.49 It was also felt that commercial activity placed pressure on parents to participate in voucher schemes and/or to buy particular products for their children, as well as there being potential exploitation in relation to customer loyalty. There was also pressure on pupils to participate in voucher schemes. Financial costs for pupils (and ultimately their parents) were associated with the use of vending machines. It was noted that the costs of goods in vending machines were often more expensive than elsewhere and that, because of accessibility, pupils were tempted to spend money in them. One interviewee also felt that there could be a bullying issue if some children had money to spend in vending machines and others did not. In terms of financial costs, it was noted that fair trade goods were usually more expensive than other goods, however this was felt to be counterbalanced by the contingent benefits associated with involvement in fair trade.

4.50 Pupils found it difficult to identify costs, but when they did, the most common was the same cost identified by local authority and school staff, i.e. an unhealthy diet due to their use of vending machines/chip vans etc. Pupils also felt that there may be a risk of their school (and them by association) being involved with unethical companies and therefore they felt it was important for schools to investigate company backgrounds prior to their involvement:

" We have to investigate them before we let them in because it might be a deal we don't agree with e.g. we're doing fair trade and then a big coffee company comes and sponsors us" (primary pupil).

Steps taken to identify the costs/consequences of commercial activity

4.51 Interviewees were asked if they had taken any specific steps to identify the costs/consequences associated with schools involvement in commercial activity. Roughly equal numbers of school interviewees said they had as said they had not taken steps to identify the costs involved, whereas very few local authorities appeared to have attempted to identify the costs involved. This may be an optimal approach as the cost of acquiring additional information may be greater than the value of the information it reveals. For those that had taken steps to try to identify them, there was little or no formal identification of costs, but interviewees said that they always did their "homework" beforehand, looked at the pros and cons, weighed up the issues, considered the amount of management time involved, along with other workload issues, ensured that it was a company that they wanted to be involved with and looked at the moral, ethical issues and implications, to ensure they were not contrary to the ethos of the school, "if there were any strings we wouldn't entertain it" (headteacher, secondary). Most noted that they would go through the decision-making procedures within the school and, if they were unsure of anything, they would run it past the local authority first. The business managers employed in some local authorities were seen to have helped schools cut down on the costs in terms of staff time in tracking down funding.

The extent to which it is easier to identify the benefits rather than the costs

4.52 Overwhelmingly, interviewees felt that it was much easier to identify the benefits rather than the costs associated with commercial activity. They acknowledged that it was easier to focus on what the school got out of it rather than to look at any possible downsides. Furthermore, it was felt to be easier to quantify the benefits e.g. the financial benefits rather than the costs which may be opportunity costs and/or costs that are simply too difficult to observe or value. Nevertheless, interviewees contended that if the costs were too great, they would not become involved.

Unacceptable commercial activity

4.53 School interviewees were asked to identify any type of commercial activity that they felt would be unacceptable in school. Their responses could be divided into 3 main areas, with the main focus being on the first 2:

• Health/welfare
• Ethical
• Moral.

4.54 Unacceptable commercial activity relating to the health/welfare of pupils was the main area identified by interviewees (29 in total), for example, in relation to the promotion of cigarettes, alcohol, crisps, fizzy drinks, and chocolate products. A number of interviewees noted that, in the past, their school had been involved in voucher schemes, e.g. for crisp and chocolate manufacturers, but that this would now be considered unacceptable. Although some schools were receiving funding and sponsorship from local distilleries or local hotels and pubs, they felt this was acceptable because it was a local company providing support for the local school and there would be no product promotion involved.

4.55 A number of interviewees (5) also stated that they had a policy of no vending machines so these would be seen as an unacceptable form of commercial activity within their school. In terms of pupil welfare, interviewees also highlighted the need to ensure that companies involved with schools had appropriate health and safety polices for working with young people and that any adults involved with pupils would behave appropriately.

4.56 Where pupils were able to identify unacceptable commercial activity, they also felt that the advertising of unhealthy food, cigarettes and alcohol was inappropriate. Pupils from one primary school also identified environmental factors and felt that it would be wrong to advertise cars or petrol in school.

4.57 Ethical concerns were also raised by 19 interviewees when discussing unacceptable commercial activity. These concerns were raised at an international, national and local level. Thus, interviewees said that they would not be involved with multi-national companies whose trading policies were deemed to be unethical and had "dubious third world connections" or "purchasing things from other countries where people aren't getting paid very well" (headteacher, primary). However, interviewees acknowledged that whilst they tried to check companies' affiliations, it could be difficult to access accurate information in this area. At a more local level, interviewees also stated that they would not be involved in any commercial activity that was contrary to the ethos or values of the school and/or the local authority.

4.58 The active endorsement of products by schools was also viewed as unacceptable. Similarly, they felt that any commercial activity that tried to influence the purchasing patterns of pupils would be unacceptable, whilst one secondary headteacher went further still and suggested that the "issue of branded products being traded at the school raises the question of ethics". Interviewees from some areas also felt that the promotion of football clubs would be unacceptable due to sectarian issues. Commercial activity which placed too many constraints on schools and their activities were also deemed to be unacceptable.

4.59 Moral concerns were raised by 4 interviewees from Roman Catholic schools who noted that anything that was contrary to the religious values of the school would be deemed unacceptable.

4.60 School-level interviewees were also asked if they had ever refused any type of commercial activity and a small number (8) said they had, usually because they did not feel comfortable about the school being involved with a particular company. Most interviewees said that they had not been in a position to refuse commercial activity because the opportunities had not presented themselves. What was clear from the interviews was the protection that the local authority provided for many schools, which meant that they would not be approached by companies in the first place, "they wouldn't allow certain things to come near the school" (headteacher, secondary).

Impact on purchasing patterns

4.61 Interviewees in both primary and secondary schools in the sample were asked to consider the extent to which commercial activity within the school might influence pupils' purchasing patterns. The most common response from school staff in more than half the sample of 50 schools (29), most of which were secondary schools, was to assert that such activity did not influence pupils' purchasing patterns, although it should be noted that it was not clear whether this response was based on evidence or merely perceptual. Two interviewees qualified their response by saying that the amount of commercial activity taking place in their school was not significant enough to have any effect. Again, this may be a function of the selected nature of the types of activities undertaken, if activities were perceived to have major impacts on pupils' behaviour then schools may not have engaged in that particular activity.

4.62 Other interviewees noted that pupils tended to go with the cheapest, so that if the local store down the road had a special offer on fizzy drink, for example, pupils would go there to buy: "If someone appears with a six-pack of [fizzy drink] then they're all down there" (deputy headteacher, secondary). Indeed, one primary headteacher posited that commercial activity might lead to pupils comparing prices more. Equally, it was felt that voucher schemes did not influence parents to go out of their way to shop at a particular supermarket, it would only be if they shopped there anyway. Pupils spoken to during the course of the research also reiterated this point.

4.63 Almost a third of interviewees (16), most of which were from primary schools, speculated that commercial activity may have had some impact on pupils' purchasing patterns, but only in a very minor way. One primary headteacher highlighted the effect that involvement in enterprise activities had on pupils here, but this was in terms of their pride in what they had produced, rather than any change in their purchasing patterns. An element of what the literature review referred to as "pester power" was recognised - interviewees referred to pupils pushing parents to shop at a particular supermarket in order to collect vouchers from there. Notably though, as section 3.26 showed, interviewees indicated that parents were not actively urged by the school to do so, yet there appeared to be a tacit acceptance that this occurred through the pupils. In one school, the vouchers collected were then "posted" in a designated box in school for the particular supermarket, which the children were said to really enjoy doing:

"… so they'll be asking grannies and granddads as well to buy from [name of supermarket] to get more vouchers" (headteacher, primary).

4.64 At the same time, demonstrations or workshops in school might, it was felt, encourage pupils to ask their parents to buy certain products, for example, where pupils had been given a loaf of bread after a visit from a local bakery. However, it was noted that this was probably more pertinent in primary schools because older pupils tended to make more of their own choices. In contrast, two interviewees felt that television and peer groups were a greater influence on purchasing patterns than commercial activity itself.

4.65 Finally, a small number of local authority and school interviewees who believed commercial activity did influence pupils' purchasing patterns, highlighted the increased awareness of eating more healthily that accrued where tuck shops and vending machines stocked healthy options. In other words, there was a positive change in pupil purchasing patterns which may be regarded as a benefit. In one secondary school, the machines only stocked water because there was now no demand for other drink products. However, interviewees in 2 secondary schools reported a negative effect on purchasing patterns. In one of these where pupils used a cafeteria plastic card to purchase food and drink, purchases could be monitored and the headteacher registered alarm that "kids are still buying the wrong thing because these machines are there". In the other school, the deputy headteacher felt it was the pupils' purchasing patterns that influenced the stock in the tuck shop, rather than the other way around, "we stock it in response to their demands".

4.66 Pupils' views on whether commercial activity impacted on their purchasing patterns were mixed, generally they felt that it did not influence what they bought (and certainly did not influence what their parents bought) "we go to [name of supermarket] because it's our local shop" (primary pupil). However, in line with the Barnardo's report highlighted in the literature review (Ludvigson and Sharma, 2004), which found that pupil choice was affected by availability, pupils from one secondary school did think they bought more food and drink because it was readily available from vending machines throughout the day. In addition, involvement in fair trade activities had made pupils think about what they bought.

Summary

• The most commonly identified benefits for schools regarding their involvement in commercial activity were: access to materials, equipment, prizes and trophies; enhancement of the curriculum or learning environment; financial benefits; partnerships and links with business; community engagement and links; the promotion of a school ethos/identity and parental engagement; and advantages associated with the social milieu of vending machines ( e.g. retaining pupils in school or alleviating accommodation pressure).
• The most commonly identified benefits to businesses of involvement in commercial activity in schools were: community engagement and links; PR and sales; and the provision of training opportunities.
• The most commonly identified benefits for pupils were: pupils' increased understanding of the commercial sector; enhanced facilities, equipment and experiences; sponsorship/business involvement which brings relevance to pupils' learning; enterprise skills/activity; health-related benefits; employment opportunities; enhanced identity; the encouragement of team work; the encouragement of reading; and choice for pupils.
• A number of benefits for pupils were only identified at local authority level, these were: the benefits associated with team working through enterprise activities; enhanced identity associated with new football strips; book sales which encouraged pupils' reading; and vending machines providing pupils with more choice.
• Benefits for school staff included increased expertise in, and understanding of, the commercial sector. For parents, the main perceived benefits were the provision of essential items ( e.g. school uniform at a reasonable cost) and increased involvement in their child's school.
• In order of frequency, the main costs to schools identified were: staff time/administrative costs; compromising or conflicting values and/or policies; the health of pupils; over reliance on funding; lack of choice in facilities or equipment provided; maintenance of equipment donated; liability for promotion; being in breach of code of conduct or financial regulations (probity); parents perceiving a lack of funding in the local authority; and the need for the school to match funding. It should be noted that these were often potential costs, rather than actual realised costs. Local authority respondents uniquely highlighted the legal consequences and financial regulations that might affect some commercial activity.
• Costs to individuals reflected those identified for schools, including: the health of pupils; pupils' over exposure to or representation of certain products; staff time; pressure on parents (pester power); exploitation of children; pressure on pupils to participate in voucher schemes or to buy products; lack of protection for staff; financial costs; and bullying.
• When pupils were asked to identify the benefits and costs associated with commercial activity, their responses reflected those of other interviewees. In terms of benefits, pupils focused on the improved equipment, facilities and experiences that were available to them; that they had a better understanding of how the commercial sector operated; and that they had opportunities to learn new skills via their schools' involvement in commercial activity. Pupils found it more difficult to identify costs, but were able to highlight the potential costs to their health from their use of vending machines and the risk that schools, via commercial activity, might become involved with "unethical" companies.
• The importance of local authorities' role in "filtering" certain types of commercial activity and protecting headteachers from hard sell approaches was highlighted. Secondary schools as larger consumers may be more likely to be targeted by such approaches.
• Overwhelmingly, interviewees felt it was easier to identify benefits rather than costs. They acknowledged that it was easier to focus on what the school got out of it, rather than look at any possible downsides. Furthermore, it was felt to be easier to quantify the benefits rather than costs which may be opportunity costs or costs more difficult to observe or value. Nevertheless, interviewees contended that if costs were too great, they would not become involved. Whilst little or no formal identification of costs was reported, "doing homework" and "weighing up all the issues" was often noted when asked specifically about steps to identify costs.
• School interviewees identified certain areas of unacceptable commercial activity: primarily those that adversely affected the health and welfare of their pupils and those that related to companies that were deemed unethical, as well as those activities that were contrary to the ethos and values of the school or the local authority. The active endorsement of products by schools was viewed as unacceptable as was any commercial activity intent on influencing pupil purchasing patterns.
• When asked directly about the impact of their current commercial activity on purchasing patterns, more than half the school respondents indicated no such impact. Most of the other responses implied it did so in either a very minor way or had actual positive effects, such as influencing healthier food options. Only two secondary respondents indicated any negative impact.

CHAPTER FIVE: POLICY AND GUIDANCE ON COMMERCIAL ACTIVITY IN SCHOOLS

Introduction

5.1 Local authority and school interviewees were asked to give their thoughts on the local authority's policy position regarding commercial activity in schools and to comment on their awareness of, and degree to which, any written policy/guidelines were useful. Thoughts on the desirability of possible future guidance from the Scottish Executive were also provided.

The policy position and role of the local authority in commercial activities in schools

5.2 The following local authority and school perspectives on the authority's policy position and role regarding commercial activity in schools were revealed:

• No defined policy in the context of delegated responsibility
• Cautious approach to commercial activity
• Supportive policy position
• Advisory role.

No defined policy

5.3 Twenty one interviewees, (11 of them being local authority representatives), suggested that the local authority did not have a defined or specific policy and role regarding commercial activity in schools, although certain overarching principles existed. In these instances, individual schools and headteachers were said to have been delegated responsibility or autonomy in this area, "we respect their trust and judgement" (service manager), with authority advice and support available for schools if they requested it:

"We don't have a comprehensive policy on commercial activity. The only thing that we do state in policy is that no commercial activity will involve alcohol and cigarettes. We devolve the responsibility for commercial activity to the headteachers to make their own decisions about the level of commercial activity in the school" (head of performance management).

"I quite often get phone calls from headteachers saying 'this company has contacted us about x, what do you think?' and the general answer is, 'You're the headteacher, you have the delegated responsibility to manage the school, we'll give you advice, but if you want to go ahead, that's a decision that you take locally'" (quality standards manager).

5.4 School representatives were generally happy with this position, acknowledging that the decision making process was located within the remit of school management structures, but that local authority personnel were available and approachable if and when the need arose. The absence of defined policies and overt involvement of the local authority in directing commercial activity was seen as the most appropriate position.

"I know there is a degree of local discretion, but also, anything that you would consider might be dodgy in any way, you would have to run past the authority" (school business manager, secondary).

5.5 A further 7 school representatives were unclear as to the local authority's position and role.

"I'm not sure that there is a policy as such. I think they are keen to develop enterprise in our children, and commercial awareness would be a part of that. I think their stance would be, like ours, that it would be carefully done and always with the children's best interest at heart" (headteacher, primary).

Cautious approach to commercial activity

5.6 Eighteen interviewees, (12 of which were local authority personnel), described the policy position of the local authority regarding commercial activity in schools as being cautious. This generally involved the notion that commercial activity could be entered into if the schools thought it was in the best interests of the pupils, with the authority again being seen to offer support where required. Interviewees also acknowledged that the local authority would not generally be proactive in encouraging schools to go down this route without due consideration of possible risks and implications:

"The position would be supportive but cautious. We are keen for schools to get any benefit they can from the outside world and that schools are outward looking and enterprising places to be, but we are conscious that we are dealing with business - big and small - and people are not necessarily totally altruistic when they are approaching schools" (head of quality improvement service).

5.7 Local authority policy positions were also said to be defined by their desire to offer protection to schools and pupils from the possible effects or influences of commercial interests, "acting in a sense of in loco parentis responsibility for the young people" (head of education services). Some local authority interviewees suggested that their policy position was highly cautious, to the point of being restrictive. One example of this was an authority's refusal to allow the distribution of a sun-care leaflet through schools because the sunscreen manufacturer's name was prominent throughout the leaflet. One education officer also suggested that because of the political orientation of the authority, its standpoint on commercial activity was "very, very cautious" almost to the point of being opposed.

Supportive policy position

5.8 Sixteen interviewees suggested that the local authority pursued a supportive policy approach to commercial activity in schools. The majority of comments indicated that this support was, however, moderated with varying degrees of caution. Whilst the principle may have been acceptable, authorities were still concerned that schools exhibited selectivity regarding the extent and the nature of the commercial relationships they entered into. Hence, local authority policy standpoints could generally be described as being selectively supportive, or supportive with the application of certain caveats:

"We are supportive of some activities. The line would be drawn if it was an inappropriate company or product - cigarettes or alcohol, these kind of things" (children's services officer).

5.9 Direct sponsorship, product placement and activities, products or services that were not in line with a local authority's wider priorities, such as healthy eating, would not generally be supported. However, school representatives generally reiterated the prevailing view from local authority interviewees that their authority offered support to schools engaging in commercial activities, within reason.

Advisory role

5.10 Within the contexts of delegated responsibility and the absence of defined policies, the local authority role was generally presented as being based on advice rather than direction and prescription. One local authority interviewee stated that the authority had recently established a working group to explore the issues surrounding vending machines in schools, the output of which was likely to be based on producing guidance and advice rather than any directive. Similarly, another suggested that "our role is to give advice" (head of educational resources). Some interviewees, however, highlighted some degree of prescription and limitations imposed on schools in terms of the types of commercial activity permitted in schools. One interviewee, for example, noted that certain boundaries had been put in place which had prevented a primary school from installing vending machines:

"We made a policy decision that vending machines in primary schools would not happen because we are promoting healthy eating and we didn't think it was appropriate" (head of resource services).

The presence and usefulness of local authority guidance or written policy regarding commercial activity in schools.

5.11 The majority of interviewees across the sample indicated that that the local authority did not have a written policy or defined guidelines concerning commercial activities in schools. This was the response given by 23 local authority representatives, 9 primary and 6 secondary school personnel. Of the local authority interviewees, 8 indicated that it would be useful to have such a policy whereas another 7 said it would not be necessary. Slightly more school representatives suggested that a written policy or guidance would or could be beneficial.

No written policy

5.12 Those who favoured the local authority having a written policy generally did so because of the consistency and clarity it could provide as, and when, the scale of commercial activity in schools increased. As it became a bigger issue, it was felt that schools required more formalised procedures for seeking advice and guidance:

"If it was to go beyond the scale we're currently talking about, then probably guidance would have to be there in black and white" (senior education manger).

5.13 Several school representatives welcomed the certainty and reassurance that written guidance could offer them; "It would define it for you in case you overstepped or did something inappropriate" (Primary school representative). Others suggested that a policy was not needed because of the small scale of activity currently being undertaken and that decisions should be left to the discretion of headteachers.

Written policy exists

5.14 About a quarter of local authority and school interviewees indicated that they were aware of the presence of written policy or guidance, and this was, on the whole, seen as offering general advice and guidance too schools rather than imposing rigid frameworks and procedures:

"We have a sponsorship policy and guidance encouraging schools to actively consider the company and what they are involved in, and we don't allow sponsorship from tobacco or alcohol manufacturers, and we try to avoid it from [fast food] companies (communications manager).

Source: Local authority documentation provided in the NFER study, 2005

5.15 Several suggested that such guidance was either linked to, or contained within, other local authority policies, such as Enterprise in Education, healthy eating initiatives and general financial management guidelines.

"We are developing a policy right now in terms of the 'Hungry for Success' criteria, where we have certain targets about providing healthy drinks, moving towards healthy tuck shops" (head of resources services).

5.16 Where comments were made, the usefulness of existing policies and guidance related mainly to the reassurance they offered schools and links to sources of information that could be accessed. A primary school representative suggested that a written policy was very useful as "you don't have to go and ask, you know what to do". Similarly, official policy guidance was felt to give headteachers confidence that a particular course of action was valid and appropriate.

"I have been questioned by parents about the legalities of certain things, and it is there for my protection" (headteacher, primary).

5.17 Whilst acknowledging their benefits, several interviewees were also mindful that policies and guidance should not take away the level of local discretion and decision- making function/responsibility of headteachers. Centralisation of decision-making with regard to commercial activities in schools was not welcomed.

Links to other policies

Hungry for Success

5.18 Local authority interviewees were particularly cognisant of the expectations of Hungry for Success, the report of the Expert Panel on School Meals (Scottish Executive, 2002), referring frequently to plans for the de-branding of vending machines and, in some cases, to phasing them out altogether. Both local authority and school-level interviewees identified a move towards healthier options in school canteens and dining rooms, as well as in school tuckshops and vending machines, citing both the influence of Hungry for Success and the "health promoting schools" initiative. The Scottish Health Promoting Schools Unit ( SHPSU) was established by the Scottish Executive in 2002 in order to help schools in Scotland achieve their target of becoming a health promoting school by 2007. It has developed the document Being Well - Doing Well ( SHPSU, 2004) which aims to produce a working definition of health promoting schools. Several interviewees in the current study reported the removal of fizzy or added sugar drinks as a direct result of this initiative,

Determined to Succeed (DtS)

5.19 The study has shown that links with local businesses were being actively encouraged within the local authorities. Within the sample of schools, there were a number of examples of enterprise activity taking place, which involved pupils setting up and running their own businesses as per the recommendations of DtS. Equally, there was evidence of the underlying ethos of DtS, that it is not just about producing the entrepreneurs of the future, but involves the development of "enterprising values" and skills, so that everyone understands "the contribution they can make as citizens, both to society and the economy" (Scottish Executive, 2003). Thus, it becomes more of an experiential learning process, where pupils are involved in decision making and take responsibility for those decisions.

5.20 As the literature review for this study points out, of the four arenas of commercial activity consistently highlighted in the literature, DtS activities would appear to be most closely linked to the third arena, indirect advertising, where companies come into schools to work with pupils to promote business skills and/or awareness. DtS activities identified within the sample of 50 schools in this study lend support to this statement. However, the selling of items that pupils had produced as a result of their DtS activities was also identified, linking them to the first arena of commercial activity, namely product sales.

5.21 The 6 case-study schools were reported to be particularly involved in enterprise activities, which were closely linked to the DtS initiative. DtS was viewed positively and had led to increased awareness amongst the business community of the benefits of working with schools, as well as amongst schools of the opportunities for greater links with business that existed within their communities. In all 4 case-study secondary schools, links with the business community were said to have been well-established prior to DtS. One of the case-study schools, in particular, reported no difficulty in developing at least 5 partnership agreements with local companies, before the 2006 target, as per the DtS recommendations (Scottish Executive, 2003). There was also evidence amongst the case-study schools of pupils making presentations at conferences, and in one case to the DtS Review Group, about their experiences of enterprise activity. In 4 of the 6 case-study schools (3 secondary, one primary), there were dedicated staff with either a business or enterprise brief.

Perspectives on the introduction of 'best practice guidelines' by the Scottish Executive

5.22 The great majority of interviewees indicated that they would welcome the introduction of best practice guidelines from the Scottish Executive. Twenty local authority personnel, 15 primary school representatives and 15 secondary school representatives suggested that such guidelines would be useful. The main reason given for this was that they saw potential value in sharing the good practice and experience of others with regard to conducting commercial activities in schools.

"It would always be useful to see what other Authorities are doing and see what we can learn form them. There are ideas for best practice out there, and we could learn from it and adopt it" (communications manager).

5.23 The sharing of knowledge, information and experience was seen as crucial in helping schools to make the best out of the opportunities associated with engaging in commercial activities. Exposure to the experience of other schools and authorities was also seen as possibly encouraging others to undertake such activities, but with the benefit of increased awareness and understandings. According to one local authority interviewee, "anything that helps schools understand and move into that area would be helpful" (head of performance management). Similarly, another interviewee contended that the existence of centralised guidance might equip some schools with confidence, motivating them to engage in commercial activities they might otherwise not have considered.

5.24 Local authority and school-level interviewees suggested that the introduction of guidelines could lead to increased consistency in the approach to, and nature of, the commercial activities undertaken across authorities and schools. The credibility of such ventures could also be increased though this centrally derived consistency:

"Guidance from the Scottish Executive would ensure that there was consistency of approach across Scotland" (head of education service).

"It would make it consistent and parents across Scotland would recognise that here is a lead from the Scottish executive. It would be a good basis for councils to come up with their own policies that would be consistent from one council to another" (head of education).

5.25 The existence of centralised guidelines was also said to provide a back up for individual authorities and schools, providing reassurance that they were acting in accordance with accepted and agreed policies. Having "a fall back to cover every eventuality" was seen as very valuable "should something occur" (strategic resources manager). Several school representatives noted that such guidelines would provide them with a checklist to consult before entering into commercial relationships and could also provide them with a benchmark against which to consider their own situations.

5.26 Twelve school representatives and one local authority interviewee suggested that guidelines could be useful in certain circumstances, or if certain conditions were satisfied. Primarily, this revolved around the guidelines being succinct and not posing a threat to the flexibility and local discretion currently enjoyed and valued by local authorities and school. Hence, centrally circulated guidelines could be useful, provided they were advisory rather than prescriptive in nature.

"It would be useful provided it was minimal. If they gave examples of what they deemed to be good practice, rather than a restrictive package that actually inhibited. What we don't want is more documentation because we're drowning in it already" (headteacher, secondary).

"It would be useful as long as it fitted in with my view of things. I wouldn't like to see them coming along and dictating to me what I can and cannot do in my school" (headteacher, secondary).

"I would welcome that as long as it was guidelines and not regulations that stymied innovation or good practice in a particular locale" (head of education services).

5.27 Four local authority interviewees and 3 secondary school representatives stated that they would not find the introduction of guidelines at all useful. One interviewee suggested that schools were already capable and competent in conducting themselves in commercial relationships. Others contended that guidelines could take the form of policy and direction, constituting "compliance documents" (secondary school representative).

5.28 A local authority representative noted that centralised guidelines were unwelcome and local authorities should be responsible for overseeing commercial activities in their areas. The introduction of central guidelines was also seen as unwelcome because of the potential for increased associated bureaucracy adding to the administrative and governance burdens of schools. Furthermore, several interviewees noted that both schools and authorities were already dealing with large numbers of policies and practice guidance documents:

"The Scottish Executive seems to be generating guidelines on absolutely everything at the minute. We would like some time for consolidation. I think schools are a bit bogged down by them" (deputy headteacher, secondary).

5.29 It was also suggested that the broad range of commercial activities and the diverse contexts of schools and authorities across Scotland meant that such guidelines would not be able to accommodate them all in a comprehensive and useful way.

Summary

• Most interviewees contended that local authorities did not have a written policy or set of guidelines regarding commercial activity in schools. Opinions were mixed as to the desirability of this, but most suggested that headteachers' autonomy and responsibility was a more effective way of managing commercial activity. Where policies did exist, they were often said to be linked to other broader local authority policies and priorities and were advisory in nature.
• Local authorities were generally thought to be cautious in their approach to commercial activities in schools.
• Interviewees generally noted that despite being cautious, local authorities were, in the main, supportive of schools engaging in appropriate commercial activities as long as pupils were seen to benefit.
• Local authorities were considered advisory and supportive, rather than proactive, prescriptive and regulatory.
• Guidance from the Scottish Executive was generally welcomed, as long as it centred on providing information and examples of good practice rather than constituting regulations, restrictions and direction.

CHAPTER SIX: KEY FACTORS IN GOOD PRACTICE IN COMMERCIAL ACTIVITY IN SCHOOLS

Introduction

6.1 Local authority personnel and primary and secondary school staff were asked to identify the key factors underpinning good practice in commercial activity in schools. This chapter presents their responses which have been grouped into the following main categories.

• The appropriateness of commercial activity
• The relevance of commercial activity
• Communication and management
• Information, research, consultation and planning
• Clearly defined aims, procedures and roles
• Cautious approach.

Ensuring the appropriateness of commercial activity

6.2 Fourteen interviewees suggested that ensuring that the nature of the commercial activity undertaken in schools was appropriate was a key factor in good practice. As noted earlier, 'appropriateness' invariably focussed on direct pupil benefits and interests.

"The issue is to ask, 'What are we not doing in order to be able to do this, if anything? Do we really need to do this? Does it service our needs more than it would be servicing the commercial needs of the organisation?'" (head of schools).

6.3 It was regarded as good practice for a school and a local authority to actively consider whether or not engaging in a particular activity was an appropriate course of action. One local authority representative suggested that it was generally the responsibility of headteachers to lead such debates. Hence, the appropriateness of the principle of engaging in commercial activity should be considered in relation to the general operation and direction of the school. This point was echoed by a schools industry liaison officer in another authority.

"It is about appropriateness. We have had a number of arrangements with businesses where we have had sponsorship or people coming in to provide their time to support young people, and if it is done in a planned and structured way, then they represent good practice" (schools industry liaison officer).

6.4 School personnel also highlighted the need for commercial activity to be appropriate and contribute to the school's ethical standpoints and orientations. It had to be congruent with the school's ethos and values. A secondary school representative, for example, noted that commercial activity could be appropriate when it highlighted and reinforced the positive messages already being promoted in the school such as healthy lifestyles and citizenship. Thus, he concluded:

"The biggest thing is applying ethics to it. It's a balance between the gain to the school and whether it's ethical. The pupil welfare issue comes first. Being bombarded with information from companies may persuade [pupils] one way or the other. I don't believe that school is the appropriate arena for that" (deputy headteacher, secondary).

Ensuring the relevance of commercial activity

6.5 As well as ensuring appropriateness, good practice required commercial activity in schools to have relevance for the school and its pupils, according to 13 respondents. Curriculum and educational relevance and benefit were highlighted as being essential elements of this by school and local authority interviewees. An example of this involved the development of Fair Trade activities in one school in conjunction with the geography curriculum.

6.6 Commercial activity that included pupils' participation was seen as particularly welcome. Examples included commercial activity that involved opportunities for work experience placements and companies/sponsors working with pupils in enterprise projects. "That more symbiotic relationship between schools and the world of work and enterprise is particularly good practice" (education services manager). Hence, commercial activity and the input of business professionals was seen as providing pupils with valuable experience of, and insights into the world of work. The focus on educational relevance was also seen as providing appropriate screening criteria for considering commercial activities in schools.

"It must be framed within a clear policy framework for the curriculum and the schools' teaching and learning aims" (head of quality improvement service).

"Chocolate manufacturers and crisp manufacturers and fizzy drink manufacturers would like to get into schools but we would find that difficult to justify. [Commercial activity] shouldn't be at odds with what we do educationally, we shouldn't be sponsoring companies" (education services manager).

6.7 Similarly, it was noted that commercial activity should also conform and contribute to wider local authority priorities. Healthy eating was the area most frequently referenced, and several interviewees gave the example that vending machines had either been withdrawn from schools, or their contents had been revised in line with authority-wide promotion of healthy eating initiatives. One interviewee highlighted this by the following example.

"This particular activity was going on about 'come along and play a game of bowling and then have some burger and chips' and obviously that was contrary to the healthy eating message we are trying to promote, so that was a definite 'no'" (communications officer).

6.8 Hence, commercial activity in schools was seen as a potentially effective and valuable means of reinforcing currently promoted policy, such as Hungry for Success, provided the activities were appropriate and relevant. Healthy tuck shops in schools were highlighted as an example of good practice in this area.

Communication and management

6.9 Issues and practices of communication and management were identified by 13 interviewees (roughly equal numbers of school and local authority personnel) as essential aspects of good practice. The willingness and ability of schools and local authorities to engage in dialogue and communication regarding commercial activity was presented as key in ensuring that commercial activity in schools would be appropriate, relevant and effective. In this context, the local authority's role as advisor, as opposed to legislator or enforcer, was apparent and good practice stemmed from schools contacting the local authority "if they had any concerns or wanted to do something a bit different" (children's services officer). In addition, others suggested that some degree of overseeing, monitoring and evaluation was desirable to ensure the appropriateness of commercial activity.

6.10 The presence of clearly defined and effective communication between schools and the businesses working with them contributed towards good practice through ensuring that roles, expectations and the relationships between each party were fully understood. Commercial activity was seen to be more effective when a school was able to "work with companies who understand the ground rules of why we're doing what we're doing" (secondary school representative).

"The good practice is the liaison that you have with the sponsor … there is an understanding [from both school and business] of what is going to happen with the money and what is happening with the sponsorship" (headteacher, secondary).

6.11 Working with local companies with a knowledge and understanding of the local contexts and characteristics was seen as good practice in terms of building and maintaining quality relationships. Furthermore, developing good links with the local community and raising the schools' profile was also seen to contribute to good practice in encouraging support for the school. Entering a "partnership agreement" was noted as a valuable way forward.

Information, research, consultation and planning

6.12 Ten interviewees identified the preparation and planning associated with commercial activity in schools as a key element of good practice. Within this, local authority representatives were especially likely to highlight the importance of schools conducting adequate research and gathering sufficient information on the potential business or sponsor upon which sound decisions could be made. Several local authority representatives suggested that good practice revolved around researching a company's ethical orientation and its motives for becoming involved with a school.

"Getting the background done before you engage with [a company]. Ensure there are good educational and valid reasons for engaging with them - a partnership agreement - and that there is more than just money coming out of it. Young people in their education would welcome an awareness of what companies are up to … in terms of their ethical investment policy, what they do with fair trade issues" (head of performance management).

6.13 Several school representatives also forwarded such views, stressing the need to be clear as to the company's ethical perspectives, as well as thoroughly researching exactly what it seeks to gain from the relationship and what the possible pitfalls and legal implications might be. A school needs to know "if their motives are right, if they have a real interest in education" (secondary school representative).

6.14 Awareness of suitable companies and businesses in the local area, and a network of links and contacts were seen as desirable in making commercial activity more straightforward and logistically effective. Corroborating this, 2 primary school respondents stressed that the companies should be "reputable", and "well-known". Primary and secondary representatives both highlighted the importance of "direct contact" with companies, and that liaison should be "at a personal level". One secondary head noted "the major benefits have come where we have a good relationship with a company… personal relations between a school and business are very important". Some interviewees highlighted the need for consultation: parents, young people and "all stakeholders" were variously referenced here. The importance of the backing of such stakeholders was also identified.

Clearly defined aims, roles and procedures

6.15 The existence of clearly defined aims underpinning commercial activity in schools was a key element of good practice according to 9 school representatives. This was seen to involve having a clearly defined project or scheme for sponsorship or business involvement would be appropriate. According to one interviewee:

"Rather than trying to get a firm to give you help for no apparent reason, try to have a clear project, well costed and well thought-out" (headteacher, primary).

6.16 Clarity, transparency and honesty provided the basis for potentially successful commercial activities according to a secondary school representative. "The biggest single thing is to be clear about the reason why you're doing things". The avoidance of complicated jargon and the need to "avoid legal language" constituted good practice in relation to this. Another secondary respondent's advice was "keep your books right", stressing the need to be able to demonstrate that "what you're doing is perfectly valid". Thus, an appropriate accounting and auditing system was highlighted as a key factor in effective practice. More than one interviewee highlighted the need to consider the legal implications of any commercial activity and to ensure it was "within legal boundaries". Health and Safety issues were raised here too.

6.17 The appointment of suitable staff (with dedicated time) emerged as a factor : "having key people in key roles" "a liaison person between school and business" were identified as components of effectiveness. The need for "enthusiasm" from those with a commercial activity brief was also noted. The value of the business manager role was cited by both a primary and secondary representative. Commitment from the whole school community - staff, pupils and parents was also highlighted as a key factor.

Cautious approach

6.18 Entering into commercial relationships and partnerships with businesses and sponsors with a degree of caution was highlighted as a key element of good practice by 4 interviewees. A local authority interviewee noted that it was important for schools not to get "swayed by the offers on offer". Schools need to exercise caution as:

"Commercial companies are not, in the main, going to offer services that aren't of some advantage to themselves" (head of education service).

6.19 The ethics and judgement of individual headteachers were identified as central to a school's careful approach to entering into commercial relationships. As noted in section 6.8, the advisory role of the local authority within this cautious approach was also identified. Several school representatives highlighted the need for high levels of caution and checking prior to engaging in such activity. Good practice stemmed from "looking at it from every angle and try to see if there's any hidden agenda there" (secondary school representative). Taking this point much further, another interviewee suggested that good practice stemmed from resisting all involvement in commercial activities unless it was absolutely demonstrable that the school and its pupils could in no way be compromised or exploited and that the outcomes would be worthwhile:

"We start from a very negative point. Children can be utilised and so easily manipulated, so it's basically a 'no' unless there's overwhelming benefits" (headteacher, secondary).

Summary

• A number of viewpoints highlighted the need to consider and reflect carefully on the relevance and appropriateness of any particular commercial activity in schools. As well as being directly in pupils' interests and congruent with the school's values, considering the activity's contribution to schools' and local authorities' priorities was seen as a component of good practice.
• Communication and effective management between schools, local authorities and businesses was seen as good practice, as was the involvement of local companies and the inclusion of local communities. Direct contact with businesses and partnership approaches were also noted.
• Information, research and planning were highlighted as key. Knowing the company's motives and ethical orientation was particularly important. In addition, consultation with parents, pupils and other stakeholders was identified.
• There should be clearly defined aims and procedures, including adequate auditing, accounting and evaluation systems. Consideration of any legal implications was also raised.
• The involvement of suitable staff with dedicated time and commitment from the whole school community were also highlighted as key factors.
• A degree of caution was recommended before entering into commercial relationships, with the judgement of headteachers central to this approach and the value of a local authority's advisory support was again noted.

CHAPTER SEVEN: CONCLUSION

7.1 This report has covered an array of activities being undertaken in schools in Scotland, which were identified by school and local authority representatives as being of a "commercial" nature. In describing the activities and discussing their efficacy, these interviewees have raised a wide range of ethical, educational and economic issues. It is hoped that, by relaying their accounts and viewpoints, further debate and activity will be stimulated. To that end, several key messages, and associated questions, arising from the study are put forward as a concluding comment.

7.2 First, it is important to stress that, regardless of the amount or type of activity, (and any financial returns), there was universal consensus that any commercial involvement had to be of direct benefit to pupils and their education, ethical in nature, as well as congruent with the values of the school. Throughout the study, interviewees at school and local authority level stated this with conviction and clarity.

7.3 Nevertheless, it is noteworthy that the meaning of the term "commercial activity" was open to interpretation. Interviewees at both school and local authority level often included enterprise, world of work and health initiatives within their definition of what was commercial, as well as recounting details of straightforward (and traditional) product sales on school premises. This raises the question of whether a clearer definition of "commercial activity" would be of assistance in maximising opportunities for - and encouraging consistency across - schools and local authorities. In addition, would clarification of calculations of "income generated" be of any value? Some school interviewees referred to revenue rather than profit when discussing the financial outcomes of their school's commercial activity, whilst others stated they found calculating any sum difficult.

7.4 Associated with this, a second major theme to emerge from the study was the consistent references to low levels of activity and concomitantly, low amounts of income. As chapter 3 indicates, the terminology adopted to describe income generated particularly dealt in diminutives like "spit in the ocean" and "tiny". Hence, commercial activity was not to be seen as an income source upon which a school would, or should, be in any way dependent, a point stressed by a number of interviewees. Such colourful descriptors of low-level income again confirm - or, indeed, symbolise - that it is educational merit that drives any involvement in commercial activity. Nevertheless, could this association of financial modesty with ethical stances ever inhibit opportunities and investment in educationally valid commercial activity within schools?

7.5 The third overarching issue for consideration relates to how far costs or consequences are always being fully articulated in schools' calculations about embarking on any commercial scheme. Certainly, there was more comment from local authority staff about the possible detrimental legal and financial implications when asked to consider costs. However, the fact that school interviewees did cite "caution", research into potential sponsors, monitoring and accurate auditing as key factors in good practice highlights that potential costs are no doubt being considered carefully. Nevertheless, would comprehensive checklists be of value to ensure schools did weigh up all possible consequences of commercial activity? Would techniques for undertaking cost-benefit analysis help schools' decision making in this area?

7.6 Finally, reference to checklists and analysis techniques raises the issue of the appropriateness of providing good practice guidelines and exemplars. The evidence from this study would suggest that schools and local authorities would value such a document. Accounts of activity, particularly some of the more adventurous commercial schemes, may be an inspiration to schools - and indeed businesses too. Equally, the caveats and caution that school and local authority staff are referencing may be usefully relayed to a wider audience.

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