The Federation of Indian Chambers of Commerce and Industry [FICCI] organized the third “India Sustainability Conclave 2014” on February 4- 5, 2014 in Federation House, Tansen Marg, New Delhi. This year the Conclave focussed on sustainability reporting, supply chains, sustainable financing, relationship between CSR and sustainability, global trends and outlook on corporate sustainability and sustainability as a business excellence mantra. It was a topical brainstorming platform with knowledge, networking and capacity building as additional take-aways for addressing key issues around business sustainability.
The event review brings forth the discussions from the Conclave.
“CEOs Session – Sustainability: The New Business Excellence Mantra”
The CEOs at the Panel were unanimous in their opinion that sustainability should be embedded into the DNA of organizations. It has to be made an intrinsic part of the business. This will happen when even the person working on the shop-floor talks about sustainability and not just the top management.
Mr Ranganath N K, MD and CEO, Grundfos India, said that “In order to integrate sustainability into the business operations, businesses should look at costs from the perspective of total life of the product and not just the buying cost.” Initial costs of sustainable solutions might be high, but in the long run theoverall operational and maintenance costs are lower than a business-as-usual approach.
Speaking on the issue of economic slowdown affecting sustainability initiatives, Ms Naina Lal Kidwai, Country Head, HSBC India, said “If sustainability is considered an intrinsic part and not just an additional cost, then even in times of economic slowdown, sustainability initiatives will not be impacted as they will be looked at as a cost-saving measure and not as additional cost.”
Mr Vipul Shah, President, CEO & Chairman of Dow Chemical International Pvt Ltd, said “India has many good regulations in place. Implementation and capacity building howeve remain the key.” It is important to impart training, dissemination and capacity.
Audits and checks are also necessary. Currently there are no incentives available for companies which undertake voluntary initiatives to get certified. It is necessary to provide non-financial incentives to companies which undertake additional costs to get certified. For e.g. The Indian Chemicals Council is encouraging companies to get Responsible Care certified. This is a voluntary approach undertaken by the companies themselves, however since they do not see any additional non-financial benefits from getting certified, they are unwilling to spend extra on getting certified.
Mr Manish Sharma, Managing Director, Panasonic India, said “As a result of the stricter norms, prices of new products are also being passed on to the consumers. At the same time, RoHS compliance is only now gaining ground in India unlike in Europe where it is already compliant.” In case of supply chain, it is important that all the stakeholders work together to reduce the cost to consumer.
Mr Atul Jain, Joint Managing Director, Jain Irrigation Systems Ltd, said “Innovation is the backbone of what companies do to improve and grow. Innovation is very important for a sustainability agenda for organizations and inclusiveness which leads to innovation is crucial for companies.”
MNCs, governments, banks and NGOs are all concerned over supply chain sustainability. Banks too are highly sensitive towards lending to organizations which are buying from companies (such as palm oil companies) which are not certified that they are not deforesting. Such high levels of certification are now required in supply chains of large companies
Points that emerged from the session on “The Future of Sustainability Reporting” Sustainability Reporting has a set of frameworks. There are lots of regulations now in India that are driving Sustainability reporting. There has been tremendous progress in India on Sustainability Reporting thanks to SEBI mandated guidelines on Business Responsibility Reporting (BRR). The Sustainability Reporting process is a learning process for companies as they embark on sustainability journey. With progress of time, the sustainability reports and the level of reporting in companies is changing and deepening further as they learn.
Sustainability reporting means measurement, management and change. Investors are the beneficiaries of corporate sustainability reporting since they need to make judgements on investments. The Global Reporting Initiative [GRI] framework of reporting is a learning process for companies. Currently reports are existing in 3 silos. The future of reporting will be driven by externalities. Harmonization between different formats will happen in the future. Responsible behavior and stakeholder engagement will shape the future of sustainability reporting. Role of auditors and assurance providers will also play an important role. Stakeholders and regulators asking questions will have an impact on the reporting journey.
In the current reports, there is a gap in information since they provide figures about past performance and a decision for future is made on the basis of these figures. Some more additional information is required to make informed decisions. Integrated Reporting <IR> is a means to bridge this gap in information as it tells a holistic value creation story of a company
For more information, please visit event website www.ficci.com