ESG: The Path to Sustainable Success

As an active student of IGMPI currently pursuing a diploma in ESG, I would like to share the insights I have gained thus far with my industry colleagues, our clients, potential customers, and other stakeholders. In today's rapidly evolving world, Environmental, Social, and Governance (ESG) practices are not just ethical imperatives; they are critical to long-term business success. Embracing ESG can lead to sustainable growth, resilience, and a positive impact on society and the planet. Let's delve into the three pillars of ESG and how they align with global and national sustainability goals.

1.???? Environmental Stewardship

Environmental stewardship focuses on minimizing resource consumption, reducing emissions, and protecting biodiversity. Anthropogenic activities, such as industrial processes, deforestation, and urbanization, have significantly impacted the environment. To address these challenges, companies are increasingly adopting ESG reporting frameworks, such as the GRI and TCFD.

The Paris Agreement, adopted in 2015 by 196 parties, aims to limit global warming to well below 2°C, preferably to 1.5°C, compared to pre-industrial levels. India's commitment to this cause is evident through its target to achieve net-zero carbon emissions by 2070, as announced at the COP26 summit in Glasgow. EIA play a crucial role in this process, evaluating the potential environmental impacts of proposed projects and ensuring sustainable development.

A key aspect of environmental stewardship is understanding and managing greenhouse gas emissions. Emissions are categorized into three scopes:

• Scope 1: Direct emissions from owned or controlled sources.
• Scope 2: Indirect emissions from the generation of purchased electricity, steam, heating, and cooling consumed by the reporting company.
• Scope 3: All other indirect emissions that occur in a company's value chain.

In the facility management industry, we predominantly impact Scope 3 emissions, encompassing the indirect emissions related to the services we provide. We help our clients achieve their sustainability targets and contribute to global efforts to reduce carbon footprints. This includes:

• Energy Use in Buildings: Implementing energy-saving solutions such as LED lighting, energy-efficient HVAC systems, and smart building technologies to reduce energy consumption and greenhouse gas emissions.
• Water Conservation and Water Treatment: Promoting water conservation through efficient plumbing fixtures, water recycling systems, and effective water treatment processes to minimize water usage and reduce environmental impact.
• Waste Management: Developing comprehensive waste management programs that emphasize collection & segregation strategies and proper disposal of hazardous materials to reduce landfill waste and lower emissions.
• Promoting Green Chemicals: Using environmentally friendly cleaning products and chemicals to minimize harmful effects on the environment and improve indoor air quality.
• Procurement of Scope-associated materials: Sourcing sustainable and eco-friendly materials for maintenance and operations to reduce the environmental footprint.

Our tailor-made solutions not only address these emissions but also aim to improve productivity and efficiency with measurable results. By adopting innovative practices and technologies, we help our existing clients and potential customers meet their SDGs and continuously improve their sustainability performance.

2.???? Social Impact

The social component of ESG emphasizes fostering employee well-being, supporting local communities, and upholding human rights. Companies can drive significant social impact by aligning with SDG 8: Decent Work and Economic Growth, and SDG 3: Good Health and Well-being. India's National Action Plan on Business and Human Rights, launched in 2018, underscores the importance of respecting and promoting human rights across business operations.

Materiality assessments help companies identify the most relevant social issues, such as labour practices, community engagement, and diversity and inclusion. ESG reporting frameworks, such as the Sustainability Accounting Standards Board, guide disclosing social performance metrics. By prioritizing social impact, businesses can build a loyal workforce, enhance community relations, and contribute to societal well-being.

In the FM industry, ensuring the well-being and safety of our employees is paramount. This includes risk assessment, providing adequate training, ensuring fair wages, and committing to safe working conditions. With this, we can create positive social outcomes and strengthen our societal license to operate.?

3.???? Ethical Governance

Ethical governance is crucial for ensuring transparency, accountability, and responsible decision-making at the corporate level. Good governance practices are essential for managing risks, fostering trust, and achieving long-term success. The World Economic Forum’s International Business Council released a set of Stakeholder Capitalism Metrics in 2020, providing a framework for companies to report on ESG performance consistently.

In India, SEBI has mandated the top 1000 listed companies to prepare Business Responsibility and Sustainability Reports from the financial year 2022-23. This move promotes greater corporate transparency and aligns business practices with global sustainability standards.

Materiality in governance involves identifying key governance issues, such as board diversity, executive compensation, and anti-corruption measures. Effective ESG reporting, guided by frameworks like the International Integrated Reporting Council, helps companies communicate their governance practices to stakeholders transparently.

As the business leader of one of India's leading facility management companies, I believe ethical governance entails ensuring transparency in our operations, maintaining robust anti-corruption practices, and fostering a culture of accountability. By adhering to these principles, we build trust with our clients, employees, and other stakeholders.

?The Way Forward

Integrating ESG principles into business strategy is no longer optional—it's a necessity. By embracing environmental stewardship, driving social impact, and upholding ethical governance, companies can navigate the complexities of the modern world, contribute to global sustainability efforts, and achieve long-term success.

As we move forward, let's commit to making ESG the cornerstone of our corporate ethos, ensuring that our actions today lead to a sustainable and prosperous tomorrow.