True value of company lies in its sustainability, says India Inc

Written by Kirtika Suneja | Updated: Feb 10 2014, 19:42pm hrs
Alluding that environmental and social governance are critical to maintain a successful business mantra, heads of leading corporate houses have said that the true value of a company lies in its sustainability. With increasing adoption and internalisation of sustainability into their corporate practices, India Inc reiterated the importance of maintaining a balance between sustainability and meeting business goals at the third edition of the India Sustainability Conclave 2014. The two day event held in Delhi from February 4-5, was organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) in association with The Financial Express as the print media partner and KPMG as the knowledge partner.

The focus areas of the conclave this year was sustainability reporting, supply chains, sustainable financing, relationship between CSR and sustainability, global trends and outlook on corporate sustainability along with sustainability as a business excellence mantra.

FICCI had launched its annual flagship eventIndia Sustainability Conclave in March 2012 which acted as a platform for brainstorming on how businesses can find solutions and approaches for companies to start looking at sustainability as an integral concept and to internalise it in their day to day operations.

In his keynote address at Conclave themed around Balancing business goals in a sustainability paradigm, Yvo de Boer, former executive-secretary, UNFCCC and KPMG Global chairman, Climate Change & Sustainability Service said: A new business model, True Value, is needed. We need to explore a much broader and longer term sense of what company value actually means and how the system can be evolved to recognise this. It can help business adapt and become fit for purpose in the modern business race. Where growth opportunities are maximised, and new risks are managed intelligently.

As part of its report Expect the Unexpected, KPMG identified some social and environmental mega forces namely soaring global population, exploding middle class with new spending power in developing countries (including India), shift of population from rural areas to cities. Together these three mega forces are now driving the others such as increased demand for energy, increased competition for water supplies, food security issues, loss of forests and decline of ecosystems. India is arguably one of the most exposed countries to the effects of the mega forces. In India and elsewhere, mega forces are taking us to economic, social and ecological disaster, unless a dramatic and potentially disruptive change of course can be engineered.

Besides, a Ficci-KPMG knowledge paper on Corporate Sustainability: Drivers and Enablers was also released. The paper would provide a good reference point for the discussion on corporate sustainability as it stands today.

The CEOs session of the Conclave titled Sustainability: The New Business Excellence Mantra which voiced the thinking of CEOs on how the sustainability focus has created a new business paradigm for them. Chaired by Naina Lal Kidwai, country head, HSBC India, the speakers for the session were Vipul Shah, president, CEO & chairman of Dow Chemical, Ranganath NK, MD & CEO of Grundfos India, managing director of Jain Irrigation Anil B Jain and managing director of Panasonic India Manish Sharma.

While Shah said that though there was an unprecedented need for collaboration between business, government, academia and civil society, he added that to achieve sustainable development companies must look at science and technological developments around the world.

Business excellence is a philosophy that should connect with the business strategy and passion was the most important ingredient for achieving both sustainability and business excellence. Economic, environment and social value creation is important and inclusiveness holds the key, noted Grindfos Ranganath.

On the other hand, Atul Jain of Jain Irrigation Systems pointed out that inclusiveness was the most basic requirement for sustainability because it leads to innovation which eventually culminates into sustainable growth. To achieve continuous sustained growth and fair returns to all stakeholders, providing quality products at an optimum price to the market was necessary.

Interestingly, Manish Sharma, MD, Panasonic India, explained the meaning of Eco Ideas which is the corporate philosophy of Panasonic. Eco Ideas comprise Green Life Innovation, which is about creating products that help in saving energy, engaging in R&D and acquiring consumer insights. The other part of Eco Idea is Green Business Innovation where the focus is on improving processes and consuming less of resources. He added that his organisation was in the process of addressing the issues faced by the value chain by creating, storing, saving and managing energy.

However, the faces of India Inc also pointed out certain regulatory hurdles in the adoption of these sustainable measures. Some of the issues that must be addressed were need for capacity for preparing robust and rigorous environment impact assessments, difficulty in accessing data from government agencies as there is no portal wherein project proponents can access environmental data and the need for greater accountability.