The importance of a chief sustainability officer in business strategy
Sustainability is about ensuring continuous business, and contributing to economic and social development, a healthy environment, and a stable society, says Yes Bank’s chief sustainability officer Namita Vikas
Namita Vikas is the group president and global head, climate strategy and responsible banking, at Yes Bank Ltd, as well as its chief sustainability officer (CSO). She has over 27 years’ experience in the domains of banking, technology and consumer goods, with a focus on sustainable finance, climate action, social governance, risk management and corporate citizenship. Vikas believes a CSO should function as a catalyst for the company. “It is vital for the CSO to understand business, to deliver not just on the sustainability objective, but work towards the overall business objective,” she says. From the perspective of a financial institution, Vikas says sustainability is about ensuring continuous business, and contributing to economic and social development, a healthy environment, and a stable society.
What is sustainability? Sustainability should ensure that business growth takes into account the environmental and social impact. To ensure long-term business success, sustainability needs to be embedded in the business strategy. We have seen, says Vikas, how companies with sustainability embedded into business strategies survived the 2008 crash, or how they have done exceptionally well in the capital market. It is a holistic approach to business, delivering value for stakeholders and meeting (company) objectives without ignoring the planet and people.
The biggest challenge: Yes Bank, says Vikas, is ahead of the curve when it comes to sustainability, but implementing certain initiatives can be a challenge in the absence of a level playing field. Sustainability initiatives can be an uphill task since the conversation is usually focused on costs versus returns.
The business case: It can be made through projects that will show the kind of stakeholder value delivered. For example, says Vikas, we work with 600 women in the Rann of Kutch. They were working in terrible conditions in 52 degrees Celsius to make salt. They had no access to formal credit. The biggest input cost was diesel, so the bank helped the women shift from diesel to solar pumps, leveraging its corporate social responsibility money and working with local banks to help these women get credit.
This, in fact, is an example of an extremely sustainable project where mainstream financial institutions can walk in and start financing. That’s how you build credibility among stakeholder groups and change mindsets, says Vikas.
Making sustainability sexy: Sustainability works as a catalyst and it’s important to consider sustainability literacy a very important factor too. How do you engage with human capital, and how do you inculcate diversified skills in your human resources? I think the key is to talk to each stakeholder on what there is in it for them, and how it measures up to their targets.
CEO and sustainability: Both the top-down and bottom-up approaches are important. If there is a top-down approach, then the management or the CEO is supportive, and the whole orientation of the organization changes accordingly. In the bottom-up approach, it is the job of the sustainability officer or sustainability team to engage and influence other businesses.
Are SDGs realistic? Yes, absolutely 100%. Look at the renewable energy space, India has really performed well, says Vikas. This was made possible by favourable policies, and innovative financial mechanisms, like green bonds, that work on the back of an accountability framework. It would be great if, like these parameters, parameters could be set for other issues, like water conservation, too. There is a big focus on India and I think three key areas—favourable policies, innovative financial models and accountability framework—will make it easier for India to deliver on the (UN’s) sustainable development goals.
In-house initiative: We have set a target of decreasing 10% of our carbon emissions on an year-on-year basis, says Vikas. Dustbins have been kept for shredded paper. This is recycled into stationery by a women’s self-help group. The recycled stationery—diaries, writing pads, boxes, bags, etc.—is used within the organization.
The company also has a large “migrating to LED” project under which 4,400-odd LED lights have been installed at 66 new branches and corporate offices. Energy consumption savings are estimated at about 300,000 kilowatts.
Sense and Sustainability is a series where chief sustainability officers talk about SDGs, and the challenges in making sustainability appealing to businesses and employees.