Scarcity Is The Mother Of Innovation: Anirban Ghosh, Chief Sustainability Officer, Mahindra Group

On 15th November, during the India and Sustainability Standards 2017 conference organized by Centre for Responsible Business, there was a high-level panel discussion on ‘towards strategies for the commons – pro-sustainability innovations in business models and strategies’, which was convened by Terry Nelidov, Managing Director, Erb Institute for Global Sustainable Enterprise, University of Michigan.

In his introduction and context setting, Nelidov said, “Business has an essential role in resolving some of the biggest challenges of today. Today’s discussion will be focused on innovation, internal company ethics and functioning and partner with external agencies. Our mission at the Erb Institute is to create a sustainable world with the power of business”. He asked, “What is one concrete project which your organization has taken, that undertakes business innovation, company ethics and partnering for sustainable development?” Speaking on business ethics and corporate governance to harness strategies for the commons, Dr. Mukund Rajan, Chief Ethics Officer, Tata Group, said, “Our business is built on the pillars of ethical business and good corporate governance. One of the examples is the work we are doing in the place of social sustainability, in the area of skill development. We have put together an initiative called Tata Strive, which is a collaborative effort to work together in skilling a million young people every year by 2022.”

He also added, “We are part of an entity called Focusing Capital for the Long Term. The whole premise of the FCLT is that the whole problem of the financial crisis was a focus on the short term, so focus on issues like sustainability and climate change. A big part of this is education, educating the market, educating the stakeholders and so on. The community sees good work, and there is a resonance which takes place in the brand and the company. The role of volunteering is becoming quite critical. I think encouraging corporate volunteering is important to expose the employees to the challenges of the society. Increasingly now, for customers, it’s not what you buy, but what you buy into”.

Paula Byrne, Director, Membership and Business Development, CSR Europe, spoke about the partnership for achieving inclusive and sustainable development, saying, “We have multinational companies and national partner companies, and the Sustainable Development Goals came as the perfect storm for us. It has a common language and it has goals. So our board asked us to leverage the richness of the network. One thing clear from the Sustainable Development Goals is that it’s time for action now, not just talking. There is not just an ethical issue, but an economic potential of investing in society and doing things for societal good.” She also added, “Creating sustainability will always be a win-win. Taking leadership or taking responsibility, people are going to see that, and competitors are going to see that”.

Speaking on innovation for sustainable business, Anirban Ghosh, Chief Sustainability Officer, Mahindra Group, said, “Scarcity is the mother of innovation. The most damning a business faces is the scarcity of capacity. One of the most unsustainable business is foundry operations. One of our foundries has managed to do some business process re-engineering, where they took a process and turned it around with a chemical bonding method to reduce heat, improved work conditions, and added 20 crores to the bottom line. One of the cultures of our organization was to look at frugal inventions, and this one increased capacity and productivity.” He also added, “The good news is that in India there are many projects which have a good impact on people and planet, and also return money. Water is very critical for most businesses, and certainly ours, and if water availability in rural areas is affected, our business is affected. We invested in watershed development, to make water available to the farmer, increasing irrigation, increasing the land for cultivation and so on. The social return on investment is 8 times for this project. The social returns are the income increase divided by the investment we made. The core role of Chief Sustainability Officer is to anticipate and deal with risks related sustainability.”

Regarding the circular economy, Elisa Tonda, Head, Responsible Industry and Value Chain Unit, UN Environment, said, “Our organization plays a key role in focusing on sustainable consumption and production. We helped small companies to become protagonists in the value chain, providing innovative solutions that helped them increase and stabilize their position in the value chain, think ahead, promote efficiency and strengthen the technical capacity to apply new solutions to the process in which they were participating.” She also added, “One of the successes was making sure that the market was ready to recognize these transformations in integrating sustainability. I also appreciate the interventions from the finance world, a lot of incremental improvement is easier to see happen if they can happen within the budget of the company. We see a lot of coalition among businesses to address global problems like marine litter”.  

“Right now we are working on measuring the impact of social enterprises and impact investment. With respect to measurement and SDGs, GIZ has worked on the national volunteer guidelines for business. We think building incentives and making finances available is important for responsible and sustainable business. Responsible businesses are often more successful than others. “, said Wolfgang Leidig, Director, Private Sector Development, GIZ, speaking on investing in social enterprises. Leidig also added, “You need risk investment or you have to fall back on the government with tax breaks or supporting credit. We need to understand the win-win in investing in sustainability”.