The Elephant in the Room

Shownotes:

Disclaimer: All views expressed in the podcast are Sakshi Bansal’s personal views and do not represent or reflect the views of Arup Ltd.

Excited to share the latest episode of The Elephant in the Room podcast featuring Sakshi Bansal FRSA ChMC! 🎙️ Sakshi, a recipient of The Diana Award, the world’s first UNESCO Kindness leader and Founder of Project LEAP, dives deep into the 'S' in ESG.

In our conversation, we explore:

👉🏾 Psychology's link to sustainability

👉🏾 Social equity, triple bottom line, and social license to operate

👉🏾 Challenges in reporting the 'S' factor and current industry trends

👉🏾 Global sustainability dialogue dynamics and diversity concerns

👉🏾 Millennials' & Gen Z's perceptions of Purpose-driven organizations

👉🏾 The importance of continuous learning in navigating evolving standards

Tune in for insightful discussions on sustainability and ESG with @SakshiBansal

Link to the podcast in the comments below. 👇🏾👇🏾👇🏾

hashtag#ESG hashtag#Sustainability hashtag#PodcastDiscussion

Episode Transcript:

Sudha: Good morning, Sakshi. Wonderful to have you as a guest on the Elephant in the Room podcast today.

Sakshi: Hi, thank you so much. It's so nice to be here.

Sudha: To start with, give us a quick introduction and tell us a bit about yourself, maybe your childhood, education.

Sakshi: Gosh a bit about myself. So, I am a psychologist by education, both a bachelor's and master's degree, but I'm also a management and strategy consultant now. And if I look back on my career, because it's so well integrated into who am I it's what I call a roller-coaster career or a squiggly career. It started in a tech startup. I was studying in Delhi I wanted to be a professional salsa dancer, And I came across these guys and they were doing something really cool at university, building an AI platform for billing and telling software and digital menus of the hospitality industry.

And I said, ah, I'll join you. And started working in a startup as one of those co-founders specifically focused on bringing in clients. So we were a bunch of 16, 17, 18 year olds with a team of 20 people bringing in clients and selling our hardware and software products all over Delhi on a tech platform that I knew nothing about. So that was my first real education, I think, into the world of entrepreneurship is learning how to not run a business, how to be a leader, how to talk to investors. And I think very early on, I got an insight into that world. And I think that sparked the sort of entrepreneurial interest in myself, and then I later went on to start a charity. So later means two years later, when we sold the startup to Amazon, went on to start a charity which is called Project Leap, and we were providing free education to underprivileged families in New Delhi. And that really came out of a very personal experience I had visiting some of these areas in New Delhi.

And I saw that while people want to help, they just don't know how to help And so we started Project Leap for the last 10, 12 years of my life, I've been running Project Leap. We've expanded to different parts of the world, to Nepal, Sri Lanka, pan Africa. Then I came to the UK, did leadership development here, capacity building, team building for three years and then started doing sustainability and ESG and investments.

It's just been a roller coaster of various different things, but I've had a real privilege of working in various different organisations such as the UN as a youth activist, talking about, youth employment even in New York, all the way to Australia doing change management. And now, in India in aviation so it's really just a mixed background.

But I grew up with a very simple idea. I want to be a dancer, and I want to travel the world.

Sudha: And now today, of course, you are dialling in from the UK, you are in the UK, like me not based in India at this point in time.

Sakshi: Yeah, absolutely. And I think that it's really important to be mindful of the personal, experiences you've had and how they shape you as a person. And not a lot of people have time for that kind of reflection, but I've always. And maybe that's where the psychology background comes into play, right? You make time for reflection, and you think about how things have shaped you and it helps you take the next step as well.

Sudha: So, you wouldn't assume that after degree and master’s in psychology, you'd end up doing sustainability and ESG. what's connect? How did you find that route?

Sakshi: I think it's a very good question, because honestly, I was in my first company after my master's degree doing a very psychology focused role. So doing leadership development, team building and all that. And when COVID hit and I was in parallel running my charity as well, we started taking the charity work international and remote.

I was so well versed with the grassroots challenges in India that this time I had to re-educate myself on what's happening in Africa and what's happening in New Zealand. And I had a reintroduction to SDGs as well, which is sustainable development goals. And so, this understanding about sustainability and what that means and how do we redefine it for education, which was my charity's goal, became really important.

And I think at the same time, I was growing discontent with what I was doing in my job. Not because it wasn't good, but just because it wasn't good enough. There was so much else I could do, and I think that's when the entrepreneurial spirit sort of came back to hit me. And I said, I'm working for a big company, it was Willis Towers Watson. It's a massive US based conglomerate. So, they don't just do what I'm doing, they do 20 other things. So just started ringing people up from the organisation and started asking the question. What is your role? What do you do?

What do you care about? And these are really senior people. And around that time, ESG was a word that was quite thrown around quite a lot. So some of the senior directors in my company were trying to understand what ESG means for them and for the business. And what do we take to market? And what do we say to clients?

And I offered help, I was so young, and I said, when you go and speak to clients, can I come, I can help facilitate some of these conversations. I'm good at that. And we went to Spain, we went to France, we went to, various different clients with my company.

And we just asked the question, what does ESG mean? What does it mean for your business? What can we do for you? And then we came back and synthesized all of that data to try and make a go to market offering for Willis Towers Watson. And that was my role; to go and listen and suddenly I was working with a whole different team in the company with very senior leaders. And it was my first experience of making a global strategy for a very targeted thing that I knew nothing about. But actually, I probably had done it before with the tech startup as well. So that was really interesting. And I realized that coming from a psychology background is such an advantage because I really understand some of the things around social, so ESG is Environment, Social and Governance, right?

And the social pillar and the governance pillar were really intrinsic to me.

I knew how to measure them. I knew what the impact was. I had tools and a toolkit with me that other people didn't or shied away from. And just after leaving Willis Towers Watson I published a paper on what does ESG mean for psychologists, how do we interact with ESG, how do we bring sustainability and ESG into our clients and our day to day, and why it is so important for us to be part of that momentum of ESG and the global dialogue.

I published the paper; I was presenting that as a keynote speaker at a conference. And my current employers, Arup, were in the audience and asked me to come in and consider Arup as a potential future employer. And so, I did. And I did that because Arup was much further ahead in their ESG sustainability journey. They were almost market leaders in this space. And I thought this is a real opportunity for me to walk the talk and understand how I can add value.

And so, when I first joined, I started doing private equity investor due diligence, what is the people lens of assets and how do we create a due diligence around it? What do we assess? What are the risks? How does that impact your triple bottom line, your CapEx and your OpEx? And now I look after that, ESG due diligence, what is social due diligence particularly and what does that mean for emerging markets? That's my role now.

Sudha: That's a very interesting journey and very interesting transition also. So moving on Sakshi, I was reading up your profile that you have various roles and you're doing various things in your job and outside your job, so you are the United Nations Global compact Coordinator for Arup. And you're also the president for SDGs for WICCI. What does this mean and what does this entail and why are you involved?

Sakshi: These are really interesting roles. So, at Arup, I am, as you said, the UN Global Compact Coordinator.

Arup is signed up to UNGC. We are one of the business partners and signatories to the UNGC. So UNGC has a set of regulations and guidelines and commitments which is around making sure that human rights violations are not in our supply chain and making sure that we're adhering to global standards of sustainability, which we do as a company.

My role is to make sure that we are signed up to it. We are reaping the benefits of being a UNGC signatory, which means we have these competitions for our junior members of the team that they can sign up to and take part in sustainability, innovation challenges et cetera.

It's really like a learning platform for our members of the company, but also for us to continue to adhere to some of those guidelines and be signatories and also inspiration to other organisations in our network. And then similarly with WICCI, I think that role is a lot about understanding what SDG means specifically for India and for New Delhi.

What does it mean for the city? How do we bring people together from different walks of life that are interested or doing something about the SDGs? Whether that's activism or research or civil society, and how do we bring that together to shape a dialogue about Delhi and SDGs? So I've had the privilege of presenting some of that dialogue at UN General Assembly last year in New York in September.

All of these roles are really about keeping an ear on the ground and really listening to what people are doing, what challenges they're facing and helping them become part of a global dialogue, because that's what we really need.

Sudha: Yeah, that's true. We all need to be connected. We all need to know what the other is doing to learn probably from successes and failures.

How important is social equity and social risk assessment /in the grand scheme of things for organisations. I call it the business equity and inclusion risk resilience.

Sakshi: I really like the way you have said it's a social equity inclusion, risk resilience, because these are very important metrics for an organisation.. Talking about social equity for any organisation for any asset, whether you're diversifying the asset or expanding the asset or decommissioning the asset, or even, it's a greenfield asset.

I think for all of them, it's very important to continue to have or to create a social license to operate. Because really, whenever you're talking about asset and built environment, it exists in a place where community, any kind of community is impacted by it. Whether that's people living there that are going to be displaced, or whether it's people living there that have to deal with the noise and the pollution that's emitted from the industry or the asset.

Whether that's the biodiversity, whether that's the flora and the fauna, that's all community and somebody or the other cares about it. And I think that if you have an asset that you're investing in, and there's a likely possibility or a risk that you will lose the social license to operate because people are not reaping the benefits or worse, are getting some kind of negative influence from that asset.

It's a high risk. We have seen that with organisations such as Amazon with their data centers, when they're proposing different parts of the world and the communities have protested because it's just not beneficial for the community, doesn't uplift them. It takes away sometimes the jobs or doesn't create local economic opportunities.

I think that's really important for an organisation or for an asset to have that license to operate. I think that there are specific things that you assess under social equity, right? You've got your human rights violations. These are the factors that have a direct impact on your triple bottom line, and this is not the fluffy stuff, but this is genuinely the stuff that helps you understand. Absolutely.

So, I think ESG is really connected. Environment, social, and governance they're interlinked, and a lot of people tend to focus on the environment side of it. But actually, the environmental policy, for example, energy efficiency of an asset, It won't be optimized unless people in the building or in that asset are ready to bring the demand down.

And that is not just in your policy, but also in day to day how are you running the company? What's the governance like? What's the culture like? Are people really interconnected? And that again, in turn impacts your environmental performance that impacts your OPEX and financial performance.

I think these are really interconnected challenges. Things like demographic changes, right? We have got energy, renewable assets that are trying to diversify their portfolio, buy new assets, create new assets, but where they sort of lack judgment or don't see this risk properly, foresee this risk, is what are the demographic changes in that local area, right? Are we going to have a population that's educated enough to take up local jobs educated in the right sectors that is going to take up the local jobs so that we can fulfill the employment demand and the headcount demand we are going to create in this area.

So if you're, creating a new asset in Cumbria which is western part of England, you probably need employment there. You want to create employment there and you need young people there to take up those jobs, but young people aren't ready to go to Cumbria and take up those jobs. And then plus the universities in Cumbria aren't educating the young people or don't have university courses about renewable energy. So how are we going to actually fulfil that demand? That's a very big risk that people are, or assets or investors are not able to foresee because they are not assessing the social equity.

Sudha: Yeah.

And I totally agree with you that, all E, S and G parts are interlinked when you talk about equity and inclusion piece, which is the S piece, if you don't think of one or the other, I think that is a problem. And generally, people tend to have a very narrow view.

We've spoken about, as I said, equity and inclusion, business risk and resilience. What are some of the trends of reporting on S and ESG, and what are some of the biggest challenges that companies face in reporting?

One is, of course, their narrow outlook or lack of awareness and education that these are all interlinked issues. And so what has been your experience of having worked in multiple geographies?

Sakshi: Absolutely. I think they're still struggling to understand what it exactly means.

You've got these all-external reporting standards, TCFD and ILO and GRI, and they have come up with a few factors of risk that you can assess under the S, but they're not comprehensive enough. There's so much more that goes underneath the social and governance. And, I always like to say Social, unfortunately, suffers from the middle child syndrome and governance is just really hard to understand.

So people can't pin it on procedural governance, is it operational governance? Is it systemic governance? All that. And I think that it's exactly that, if people haven't given social, the time that it deserves to be understood and they haven't gone...