Islington Town Hall. Photograph: Islington Council.

The Town Hall is racing to have Islington accredited as London’s first ‘Living Wage Place’ by the end of the year.

The Living Wage Foundation awards Place status to cities, towns or boroughs where a Town Hall leads local employers, including hospitals, universities, transport providers and sports organisations, to pay a living wage and help others to do so.

Islington Council has now convened an ‘Action Group’, which includes small and medium-size businesses, that promotes the London Living Wage of £10.55 per hour.

Speaking at the beginning of the month, Katherine Chapman, director of the Living Wage Foundation, said: “There is a growing consensus that collective efforts within defined geographic places can help re-design the way our local economies work.

“Living Wage Places is an important new scheme which uses place identity to increase Living Wage accreditations and tackle low pay, benefitting families, communities and local economies.

“We have already seen the impact on local areas when major anchor institutions such as councils or universities accredit as Living Wage Employers and use their local influence to encourage other local employers to join them.

“The Living Wage Places scheme is now creating clusters of accredited Living Wage Employers throughout the country and has the potential to shift the low pay landscape in the UK.”

The move by the council has come as part of a list of 15 recommendations made two years ago by its Environment and Regeneration Scrutiny Committee, aimed at strengthening the borough’s retail landscape.

The first recommendation, to which becoming a Living Wage Place is part of the executive’s response, was to partner up with local businesses and encouraging employers to practice “corporate social responsibility”.

Islington and Lewisham were the first councils in the UK to become living wage employers in 2012.

Councillor Asima Shaikh (Lab, Finsbury Park), executive member for inclusive economy and jobs, said: “Since these recommendations were issued, there has been a complete re-structure of the relevant services leading to the creation of a new Inclusive Economy Service.

“Work has been progressing on ‘small business-friendly’ initiatives such as the implementation of the affordable workspace strategy, the commissioning of a first-ever borough wide micro/small business survey, promotion and development of the borough’s street markets and the reframing of our town centre management approach.

“All of this activity complements and builds upon the recommendations of the scrutiny committee and will inform the development of the council’s forthcoming Inclusive Economy Strategy.”