The world is facing significant Sustainability challenges due to climate change, equity issues, natural resource consumption and other significant social and environmental concerns. Many organizations worldwide are in the process of integrating Sustainability into their business strategy. On the other hand, several leaders are gazing at the need for sustainability integration as a challenge, confused about the right approach they must adopt. Prabodha Acharya, Chief Sustainability Officer, JSW Group, is engaging in an exclusive interaction with CEO Insights to decipher the present and future need for Sustainability in the corporate world. Below is an excerpt from the interview.

With the growing trend of corporate environmental responsibility, how do you perceive the role of leaders in today's sustainability demands?

Reflecting on my three-decade tenure in this field, I've witnessed a profound evolution in the role of environmental Sustainability in the corporate realm. Initially, our primary responsibility was ensuring operational compliance, commonly called 'license to operate,' and managing environmental clearance requirements. This entailed regular reporting to statutory authorities.

However, the scope of our work has expanded significantly. Today, it's imperative that business leaders integrate environmental Sustainability into their core business strategy. This shift is driven by the urgent need to adapt to a rapidly changing world, where climate change poses an existential threat to humanity. Such adaptation requires meticulous planning to ensure that business models remain viable.

Take, for instance, the energy sector's ongoing transition. In India, while we still largely depend on fossil fuels, renewable energy sources are increasingly taking precedence. Companies dependent on the fossil fuel economy must now pivot their business strategies to capitalize on this energy transition. The role of environmental sustainability professionals has also evolved from mere compliance managers to becoming strategic architects of sustainable business practices in alignment with global environmental shifts.

The consumers increasingly favor environmentally responsible companies; would it enhance the competitive spirit within the industry? 

To comprehend the driving factors of sustainable business practices, it is essential to recognize the three principal aspects that influence corporate behavior: profit, compliance, and reputation.

Profit, or the pursuit of financial gain, is the foundational driver, ensuring that businesses remain financially robust and consistently deliver returns. Compliance, driven by fear of regulatory repercussions, necessitates adherence to legal standards to maintain the right to conduct business. Reputation, the third driver, is about cultivating a positive public image and brand equity. The journey of esteemed Indian conglomerates like JSW, Tata and Birla is a case in point.

Due to all these drivers, Sustainability has become a mainstay in business. Investors are increasingly scrutinizing companies to manage sustainability-related risks and opportunities, making it a critical factor in funding decisions. Regulatory bodies, such as SEBI in India, have mandated leading companies to engage in Business Responsibility and Sustainability Reporting (BRSR). This initiative is designed to ensure that corporations not only disclose pertinent sustainability data but also provide this information with a level of assurance comparable to that of traditional financial audits. 

Moreover, consumer demand, particularly among the environmentally conscious younger generation, is shifting towards products that align with ecological values. Internally, organizations face the challenge of resource scarcity, prompting innovation and process optimization to achieve more with less.

In summary, Sustainability is no longer an optional corporate virtue but a strategic business imperative. It not only ensures long-term viability but also offers a competitive edge, distinguishing companies that excel in sustainable practices from their peers.

What are the major responsibilities of a modern-day Chief Sustainability Officer (CSO)?

The role of a sustainability professional, particularly the Chief Sustainability Officer (CSO), is akin to that of a 'sense maker.' It is our responsibility to discern and interpret the external factors affecting our business. This understanding enables us to develop resilience and strategic responses to these influences, ensuring our business can thrive amidst external challenges. The CSO is not only tasked with ensuring financial success but also with generating a positive impact on society, people, and the environment.

Achieving this requires extensive collaboration across all functions within an organization. In fact, the CEO, by virtue of their overarching influence, is often best positioned to act as the CSO, orchestrating efforts across various departments to forge a sustainable and impactful business model.

Moreover, the CSO's role extends beyond internal operations to include external collaboration with government bodies, NGOs, thought leaders, research and development organizations, educational institutions, and the community at large. Such partnerships are crucial for driving change and ensuring that a business is genuinely sustainable.

To effectively drive change and make a meaningful impact, one must first possess a genuine passion for their work

In essence, the CSO serves as a catalyst for change, facilitating rather than directly implementing transformation. This role involves mobilizing and aligning stakeholders around a unified organizational purpose to achieve a positive and lasting impact. Therefore, I firmly believe that collaboration and the inclusion of all stakeholders, both internal and external, are vital for successfully integrating sustainability practices into a business's strategic framework.

As a professional, how do you shape up to make an impact and integrate Sustainability into the group strategy?

To effectively drive change and make a meaningful impact, one must first possess a genuine passion for their work. This elementary aspect is the bedrock of transformation. Understanding the intricacies of business operations is equally crucial, extending beyond mere knowledge of environmental or social sustainability or governance issues. It's about grasping the operational dynamics of the specific industry you're in, such as the steel, cement, or energy sectors in the case of a company like JSW. Recognizing the unique characteristics and sensitivities of these sectors is vital.

Competence is another cornerstone of success. It's not enough to be good at what you do; you must also have a deep understanding of your actions and their implications.

When it comes to instituting changes within an organization, aligning with the company's value system is imperative. Introducing new ideas that conflict with the organization's ethics, values, or vision is counterproductive. Therefore, a thorough comprehension of these principles is necessary to weave sustainability practices into the corporate fabric effectively.

People are the linchpin of any organization. They make daily decisions that determine the success or failure of the company. Recognizing and addressing the diverse needs of employees is essential. Supporting each individual in their professional journey is key to fostering an environment conducive to change. These insights encapsulate the lessons I've gleaned over the past 30 to 32 years in the field.

What is your future vision for JSW from a sustainability point of view?

We have embraced a clear vision for Sustainability, pledging to conduct business in an environmentally, socially, and ethically responsible manner. These three pillars form the foundation of our operational ethos. A key aspect of this commitment is conserving resources for future generations, which is particularly crucial for extractive industries. To track progress, we've established a systematic framework encompassing 17 focus areas that support our vision. The goal is to positively impact every life we touch, aligning with the broader mission to improve the world for current and future inhabitants. This mission is driven by a passion for Sustainability and the ambition to ensure that by 2050, all nine billion people can thrive within the planetary boundaries limits of our planet.

What would be your advice for budding sustainability leaders?

Be passionate. Sustainability intersects with all business aspects. So, subject matter expertise is crucial, coupled with an understanding of business operations and sector-specific dynamics. Developing soft skills is essential for effective collaboration and driving change. Ultimately, success hinges on the ability to inspire a collective vision and influence collective action towards sustainable business practices. 

Hobby: Gardening

Favorite Travel Destinations: “Raised in a rural setting, I have a deep affinity for natural environments and prefer the countryside over urban areas. My hometown, despite its transformations, remains my favorite place. Additionally, Switzerland holds a special place in my heart as a favored destination.”

Favorite Cuisines: Indian and Chinese

Favorite Movies: Sholay and The Sound of Music

Favorite Books: “I love the books by Devdutt Pattanaik. ‘The Professional’ by Subroto Bagchi is also one of my all-time favorites.”