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"Sustainability Is Embedded In Every Organisation’s DNA" Nitin Gupta, Capgemini
“Quite a few of the corporates address sustainability and development agendas in isolation, rather in conjunction, which further fuels up the debate of these two going hand in hand”
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In a discussion with Urvi Shrivastav, Editorial, BW Businessworld, Nitin Gupta, Sustainability Head, Capgemini, speaks about the growing importance of sustainability, future prospects and its necessity in organisations.
What are the issues companies face when tussling between sustainability and development?
The general perception is that adopting Sustainability measures is seen as a cost and effort consuming exercise and an impediment to development, as it forces corporates to look at new operating models, change existing product lines and even exit businesses which are perceived to be high on carbon emissions. Quite a few of the corporates address sustainability and development agendas in isolation, rather in conjunction, which further fuels up the debate of these two going hand in hand.
Another issue faced by the conglomerates is attempting to devise a ‘One Size Fits All’ net zero vision. Given the complexity of their presence in several geographies, operations in multiple business lines and different supply chains, companies are not able to accurately determine the business impacts if these measures are not customised and tweaked to specificity leading to de-growth!
The fact of the matter is that sustainability is now going to be embedded in the DNA of every organisation. If corporates have to survive in the future they need to look at Sustainability as an aid to their growth and giving them the necessary competitive edge in the market.
How do you arrive at a middle ground?
The tussle will end when Sustainability is looked at as a Profit Centre than as a Cost Centre and this is a challenge which the leadership needs to drive, implement and communicate to its employees, stakeholders and customers. Sustainability is not a one-time thing, it will keep evolving, just like any other technology. A Capgemini Research Institute report suggests that Innovation, driven by technology and data, will help companies improve Sustainability while ensuring profitable growth.
It’s important to break the silos and involve stakeholders throughout the process, to gauge the business impact and to ensure that business strategy takes account of these metrics in identifying opportunity and risk areas. For Conglomerates, it is imperative that localized actions plans are prepared which are more pragmatic and synergetic.
What are the positive and negative impacts of sustainability on business?
Amongst many positive impacts of sustainability, top Three would be:
· Adopting sustainable practices will help businesses in managing their risks and exploring new opportunity areas.
· Improved brand equity resulting in better financial valuation by investors, attraction/ retention of good talent and enhanced customer loyalty.
· Sustainability is providing businesses an opportunity to reengineer their traditional business practices, bringing in efficiencies and driving innovation.
Capgemini's research says that more than 80% organizations say that they have enhanced their brand reputation by improving their ESG rating; nearly eight in ten saw improved efficiency and productivity and more than 50% reduced packaging costs and increased sales.
Negative impacts will include commitment of lot of resources in terms of capital, time, efforts etc. without a determined way to measure the success of these efforts. Another negative impact on the business can be disoriented efforts due to lack of robust execution plan or unengaged personnel, leading to failure in reaping the desired benefits to business.
How is the government helping companies to maintain a balance in this respect?
Governments across the globe are adopting a stick and carrot approach to maintain a fine balance in this regard. They have introduced various incentive and funding schemes for organizations who are ensuring that they are going positive on their ESG journey measures and at the same time by penalizing businesses by enforcing strict laws if they are not on track with their Sustainability commitments.
COP26 renewed pledges by various governments including India are further leading corporates to tread this path. Governments need to ensure that they provide collaborative platforms to corporates to enable them to work with lawmakers, regulators, academic think-tanks to propel the progress and maturity of sustainability initiatives. A case in point – SIDBI - has introduced the Sustainable Finance Scheme for funding sustainable development projects that contribute energy efficiency and cleaner production. For organisations, therefore, it’s become more of a no-brainer to adopt and implement Sustainability measures for their growth and survival.
What are the sustainability goals for companies in the future?
Future Goals for corporates are very clear – Embed sustainability into the core values and DNA, take pro-active measures to transform the entire value chains, see Sustainability as a ‘Profit Centre’. The ideal scenario is to make businesses more sustainable with improved triple bottom line, thereby creating value across all three Ps - profits, people, and planet.