Because the “alphabet soup” of reporting requirements reveals indicators of consolidating with the launch of the Worldwide Sustainability Requirements Board (ISSB)’s requirements final 12 months, chief sustainability officers (CSOs) may see some aid from their reporting burdens within the 12 months forward.
The inaugural requirements, which the ISSB chair described as ”sustainability translated into an accounting language“, have catalysed a shift in obligatory sustainability reporting tasks beforehand positioned on CSOs to the authorized, threat administration and finance capabilities.
However whether or not this really frees CSOs as much as deal with efficiency enchancment and setting firm path depends upon how well-established an organization’s sustainability programme is, stated Chris Cattermole, ESG advisory and options international lead at product security and certification organisation UL Options, who famous a spike in demand for assist to execute net-zero objectives set two to a few years in the past.
Corporations with a sustainability operate that’s greater than a decade previous may see this shift in reporting burdens, however many corporations in Southeast Asia outdoors of the “excessive sustainability performers” are nonetheless under-resourced and “counting on goodwill throughout the organisation to get issues completed,” he noticed.
Higher consciousness round rising types of greenwash, corresponding to green-hush (when corporations downplay their sustainability achievements for worry of backlash) or green-rinse (when corporations recurrently change their sustainability targets earlier than they’re achieved), additionally implies that the sustainability operate is more and more tied to company fame and monetary efficiency, stated Cattermole.
Darian McBain, founder and chief government of sustainability advisory agency Outsourced Chief Sustainability Officer (OCSO) Asia concurred that determining the way to nuance communications to exterior stakeholders to keep away from greenwash and green-hush will probably be excessive on the agenda for CSOs within the 12 months forward.
Different key agenda gadgets embody navigating the environmental, social and governance (ESG) backlash in america and the forthcoming provide chain rules from the European Union, such because the Carbon Border Adjustment Mechanism (CBAM), Human Rights Due Diligence (HRDD) and anti-deforestation regulation, stated McBain.
Planning for what comes subsequent for the Sustainable Growth Targets (SDGs) post-2030, beginning with the United Nations’ Summit for the Future this 12 months, would even be fascinating to observe, she stated.
Eco-Enterprise checked in with sustainability heads in Singapore, Hong Kong, Malaysia and Indonesia to get a way of their priorities and the developments they’re watching in 2024.
Leiming Chen, senior vp, Ant Group and chief sustainability officer, Ant Worldwide
Leiming Chen is the chief sustainability officer of Chinese language fintech big Ant Group’s worldwide arm Ant Worldwide. He has has additionally served because the group’s senior vp since March 2016.
Company sustainability is a multi-disciplinary follow which includes mobilising all of the departments to come back on board. The implementation of our sustainability technique shouldn’t be merely an remoted train or a guidelines to be fulfilled. It includes an in-depth organisational and mindset transformation to result in actual change, which is difficult in our numerous, cross-culture and multi-market context. We see sustainability and enterprise development as twin worth carriers for our organisation’s long-term success, so we are going to proceed to deal with the inner capacity-building in addition to exterior engagement with our companions.
Talking of the developments in 2024, addressing challenges confronted by small and medium enterprises (SMEs) globally will change into ever extra urgent. SMEs account for round 90 per cent of world enterprise and play a key position within the international provide chain. As extra markets require obligatory carbon disclosure, SMEs will more and more want the data and assets to take local weather motion. We all the time speak about monetary inclusion and digital inclusion, however sustainability inclusion for SMEs is equally necessary.
Ant Group has been accelerating analysis and growth efforts for energy-saving and carbon-reduction applied sciences, corresponding to our efforts to enhance the working effectivity of the computing system and scale back the variety of required servers for companies by way of AI and different applied sciences.
But when the underlying enterprise mannequin and information infrastructure are usually not prepared to incorporate the “smaller guys”, or SMEs and people which can be underserved, having tech shouldn’t be going to generate actual influence. Because of this, we take a user-driven method to make sure our sustainability options are scalable in the long run. We make use of our platform capabilities and applied sciences to boost the general public’s consciousness of inexperienced and low-carbon practices in every day life, corresponding to by way of the Alipay Ant Forest challenge on the firm’s cell fee utility Alipay, which has greater than 650 million customers. They’re rewarded with “inexperienced power factors” for taking steps to cut back their emissions, corresponding to by biking to work or going paperless. These factors can be utilized to develop a digital tree on the app, which Alipay matches by planting an actual tree or defending a conservation space in partnership with native non-governmental organisations.
Joelle Chen, head of sustainability, Asia, Lendlease
An architect by coaching, Joelle Chen, joined Lendlease in 2021 and at present leads the implementation of its sustainability technique in Asia. Picture: Lendlease
The massive focus for us this 12 months is partnering with our provide chain. For Scope 1 and a pair of, there may be nearly nothing extra we are able to do other than our continued advocacy work, as a result of that’s simply the place the market is at in Asia. Whereas we now have managed to obtain 100 per cent renewable diesel that’s made in Singapore for our enterprise in Europe as a result of subsidies out there there, we satirically nonetheless can’t entry any of that right here at worth parity with typical diesel to mitigate our Scope 1 emissions. For Scope 2, we’re simply ready for extra renewables to come back on-line in Asia’s grid. We are able to put extra photo voltaic on our rooftops and take a look at enhancing power effectivity and power consumption discount on the constructing stage, however there’s nothing else we are able to do.
Scope 3 is the most important supply of our emissions and there are three key challenges that we try to sort out. The primary is on measurement and reporting, which is why we launched our Scope 3 Protocol and made it open supply, to get our friends and the availability chain to measure and report in a constant method so reporting doesn’t change into a distraction. The second is round information, which we now have been speaking about in Asia ever since I joined Lendlease. What we’ve been pushing for is transparency in our provide chain by way of verified Environmental Product Declaractions (EPDs). EPDs are fairly widespread in Europe and the Americas, however their protection in Asia shouldn’t be that nice. The third problem is concerning the decarbonisation of hard-to-abate supplies like metal, concrete and glass.
I’m fairly inspired by a few of the advances our provide chain has made, as a result of these are multi-billion greenback investments they need to make to their very own crops, and the low-carbon merchandise they produce are nowhere close to aggressive available in the market. That is the place our strategic relationship with suppliers wants to come back in. So we work very intently with our provide chain and procurement division to verify we now have these early conversations with our suppliers and assist a pipeline or challenge to provide them the peace of mind that there’s a marketplace for their merchandise and to publicise them. That’s one thing we actively champion as a result of the procurement course of may be very flawed in our {industry} and really transactional. That is the important thing nut to crack to drive demand for low-carbon supplies as an {industry}.
Within the 12 months forward, I believe the position of the CSO as a programme supervisor for all issues sustainability-related will proceed. However one thing CSOs may need to look out for is information literacy within the sustainability operate. For me, that may be a actually thrilling piece and a brand new frontier for sustainability. An instance can be wanting on the emissions information of concrete. About 20 to 25 per cent of the whole quantity of carbon produced by a constructing over its complete life cycle is from concrete, and cement is the one highest contributor – or 90 per cent – of concrete emissions. So it turns into a no brainer on the enterprise selections facet to sort out that one ingredient.
Steve Newman, chief sustainability officer, EarthCheck
Steve Newman joined EarthCheck, a world environmental benchmarking certification and advisory group for the journey and tourism {industry}, as chief sustainability officer after over eight years with hospitality group Banyan Tree. Picture: Steve Newman
Since leaving Banyan Tree, I’ve developed a wider perspective of the journey and tourism sector. While you’re working as a CSO, you may really feel fairly siloed and issues can really feel distinctive to you as a result of your work cuts throughout each single facet of the enterprise. Now that I have interaction with many sustainability groups and totally different firms, it’s fairly reassuring to understand that everyone faces the identical challenges.
Among the tasks which have traditionally been placed on CSOs are actually shifting to different elements of the manager management. The authorized and threat groups are all of the sudden having to cope with matters that have been predominantly pushed underneath the umbrella of CSOs. So the excellent news is that the roles of CSOs have gotten far clearer and they’re able to deal with the issues which can be necessary.
The market pullback on ESG is pure and anticipated as a result of ESG is maturing, and company and monetary sectors are having to develop with it. The massive problem for everybody stays attempting to reveal tangible data-driven proof that connects ESG with monetary efficiency. Till you may join these dots, it turns into compliance and box-ticking.
For CSOs, 2024 doesn’t appear that necessary. It’s not a type of spherical numbers – it’s not 2030, it’s not 2020. However it’s fairly crucial. That is the 12 months the place you’ve acquired to plan with the intention to create measurable influence within the ultimate 5 years in the direction of the SDGs and decarbonisation targets. Corporations are beginning to have interaction way more strategically in a risk-based method on these issues.
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The massive problem for everybody stays attempting to reveal tangible data-driven proof that connects ESG with monetary efficiency. Till you may join these dots, it turns into compliance and box-ticking.
Steve Newman, chief sustainability officer, EarthCheck
In my position, I’ve arrange an ESG division inside EarthCheck, which is a benchmarking certification service for sustainable hospitality operations. You’ve acquired the Massive 4 consulting corporations and these rising sustainability specialists whose providers are overpriced and in addition very generic. However inside EarthCheck, we’re specializing in an {industry} the place we’ve acquired over 30 years of experience. My purpose is to assist as many firms as potential get strategically ready to know what they need to be doing and measuring up till 2030 to allow them to reveal influence in a method that’s accessible and inexpensive. There’s additionally the necessity to assist firms in reporting as a result of there are actually way more subtle greenwashing rules, which I believe is improbable.
Julie Greene, chief sustainability officer, Olam Agri
Julie Greene was appointed the chief sustainability officer of multinational agri-business Olam Agri in 2022, after an over decade-long profession with Olam Group.
One problem I face is articulating the funding case for sustainability in a method that accounts for the rapid direct monetary impacts for our enterprise and our companions, whereas valuing the intangible or long run social, biodiversity and climate-related impacts. One other problem is entry to finance for the over 600 million smallholder farmers who’re elementary to international meals provide chains. Few have entry to formal banking techniques and even fewer have entry to newer types of worth corresponding to carbon credit from agroforestry or soil carbon sequestration initiatives, in addition to premiums for sustainable, low-carbon merchandise.
Whereas a small portion of agricultural merchandise going to sure markets and sure kinds of specialty merchandise, like espresso, can command a premium for sustainability, the majority of the world’s agricultural merchandise corresponding to grains and oil seeds at present discover restricted market demand for sustainability. Clients and customers aren’t prepared to pay for sustainable staple meals typically. This makes it troublesome to spend money on sustainability initiatives which might typically require an intense or sustained funding, corresponding to in restoring soil well being, which takes a number of years of regenerative practices to construct up.
My major focus this 12 months is to speed up the transition to regenerative agriculture. Going into 2024, we’re increasing our ambitions to advance regenerative agriculture throughout landscapes worldwide, catering to each small and enormous growers. It will require monetary mechanisms corresponding to affected person capital and well-functioning voluntary carbon markets, in addition to continued analysis and pilots to determine applied sciences and farming techniques that work in numerous contexts.
On the technical entrance, I’m intently watching the more and more nuanced understanding of how we are able to successfully harness nature-based options to sequester carbon, corresponding to agroforestry, biochar and improved soil administration. In the marketplace entrance, I’m targeted on the developments for low-carbon or regenerative agriculture licensed merchandise. I’m additionally monitoring developments in voluntary carbon markets and maintaining a tally of the nascent nature and biodiversity markets, which can maintain the potential to facilitate investments in biodiversity, ecosystems and soil well being.
We’re getting ready to handle forthcoming EU-led rules, corresponding to EU Deforestation Regulation (EUDR) and Company Sustainability Due Diligence Directive (CSDDD), in collaboration with our European companions. Within the broader international panorama the place company accountability is aware of no boundaries, new frameworks and reporting necessities are being carried out in parallel too. We’re reviewing our provide chains on an ongoing foundation and investing in options corresponding to observe and hint techniques to boost general information transparency and traceability.
Diana Guzman, group director of ESG, Prudential plc
Diana Guzman was appointed the chief sustainability officer of British multinational insurer Prudential in January 2024. Previous to taking up the Singapore-based position, she was the group’s ESG director and led the World Financial Discussion board’s Sustainable Growth Funding Partnership. Picture: Prudential plc
I’m very eager to make a powerful case that enterprise efficiency and societal progress are usually not impartial of one another, however stay extra inseparable than ever. Our tenet is that sustainability is the lengthy recreation in the direction of worth creation and that there’s hardly room for fast fixes. But when we’re to champion sustainability inside our {industry}, this effort wants to start at house. That’s why certainly one of our goals this 12 months is to develop a tradition that locations sustainability and inclusivity as core values. We wish our workers to not solely perceive how these values match into our broader company objective, however to contribute meaningfully to constructive societal and environmental influence of their day-to-day work at Prudential.
Embedding sustainable practices right into a enterprise mannequin takes time, a powerful enterprise case and the dedication of all stakeholders to make sure a seamless transformation, however we now have recognized two areas as a begin this 12 months. The primary is to allow our folks to form our influence. Our ambition is for all our folks managers to have sustainability-linked key efficiency indicators (KPIs) by 2026. We will probably be offering alternatives and platforms corresponding to coaching to boost their sustainability capabilities. Secondly, we need to pay extra consideration to the “social” facet of ESG as we imagine folks ought to be on the coronary heart of sustainability efforts. One of many methods we attempt to incorporate inclusivity is by growing merchandise that meet the wants of underserved demographics, corresponding to by way of introducing a digital product in Cambodia that gives decrease earnings clients protection on 5 crucial sickness situations for as little as US$25 per 12 months.
Given Prudential’s place as a outstanding investor and asset proprietor, we’re eager to assist a simply and inclusive transition to web zero that leaves nobody behind in rising markets throughout Asia and Africa, the place we now have an outsized presence. We collaborate with our asset supervisor Eastspring Investments to make sure that we assist our investees in assembly the wants of a simply and inclusive transition to affect real-world influence. For instance, whereas in developed markets, the main target lies on financing inexperienced power options; in lots of rising markets in Asia, discovering methods to finance phase-out of carbon intensive property like coal crops has the potential to attain important absolute carbon reductions. Which means the totally different decarbonisation pathways of those nations, even in the identical sector, need to be taken under consideration when participating with firms and policymakers and in financing the transition.
Leo Pui Yong, chief sustainability officer, Tenaga Nasional Berhad
Leo Pui Yong is the previous chief threat officer of Tenaga Nasional, the nationwide utilities agency of Malaysia. She was appointed as the corporate’s new chief sustainability officer efficient 1 June 2023. Picture: Tenaga Nasional
Digitalisation has emerged as a major focus for this 12 months. We’re prioritising the digitalisation of over 150 key sustainability indicators we now have recognized, an important step in the direction of environment friendly information administration and transparency in our sustainability journey. The primary problem we foresee in getting this completed lies within the absence of a transparent, common definition for ESG indicators, resulting in different interpretations throughout industries and corporations. The introduction of ISSB requirements heralds a pivotal alternative to standardise ESG reporting throughout industries and corporations. These requirements will advance consistency and comparability in sustainability reporting, amplifying transparency, and accountability. For the time being, our sustainability statements and reporting adhere to Bursa Malaysia’s important market itemizing necessities and stay aligned with World Reporting Initiative (GRI), the Electrical Utilities Sector Disclosure, the Process Pressure on Local weather-related Monetary Disclosures (TCFD), and the United Nations SDGs. This ensures that our digitalisation efforts contribute to broader sustainability objectives whereas adhering to industry-recognised requirements.
We’re intently monitoring key developments which can be shaping the sustainability panorama, together with enhancing local weather resilience, prioritising sustainable provide chains, and reinforcing company oversight for sustainability. To handle these challenges, we’re proactively managing local weather change dangers, working intently with our distributors to make sure sustainability alignment, and are dedicated to enhancing transparency in governance. These sustainability developments stay on the forefront of our consideration, and TNB is devoted to remaining vigilant and responsive to those evolving dynamics.
