Muhamad Umar: We plan to strengthen our partnerships with the industry, to enable an ecosystem in ESG investing and facilitate innovation.
FIRST conceptualised by the CIMB Group and its sustainability partner Impacto as the founding sponsors, the CEO Action Network (CAN) is a coalition of business leaders with a purpose and is governed by an appointed steering committee and its chair.
The coalition is led by experienced and inspiring sustainability practitioners, committed to lead by example and set new benchmarks.
Through its dedicated working group, work streams and active members driving bespoke projects, CAN aspires to pledge collective commitments and catalyse its members towards shaping carbon-neutral business models and ecosystems.
Here are the thoughts of several chief executive officers (CEOs) who are part of CAN, on three key questions posed to them.
They are Petronas president and group CEO Tengku Muhammad Taufik Tengku Aziz, Bank Pembangunan Malaysia Bhd (BPMB) president and group CEO Arshad Mohamed Ismail, Bursa Malaysia Bhd CEO Datuk Muhamad Umar Swift, CIMB Group Holdings Bhd group CEO Datuk Abdul Rahman Ahmad, HSBC Bank Malaysia Bhd CEO Stuart Milne, Microsoft Malaysia managing director K. Raman G Kesawannair, Nestle (M) Bhd CEO and Nestle Malaysia, Singapore and Brunei regional head Juan Aranols, and Telekom Malaysia Bhd (TM) group CEO Imri Mokhtar.
StarBizWeek: What is the role of CEOs in championing responsible and resilient businesses of the future?
Tengku Muhammad Taufik: A CEO today must be the key driver of transformative change – both for their own organisations and for their industry. I believe that today, a CEO has the opportunity to ignite change by first offering a wider perspective of the purpose of the organisation beyond profit.
This purpose must clearly paint a compelling picture of the value the organisation can offer to all its stakeholders, and its contribution towards the progress of society.
As organisational leaders, it is then also up to the CEO to role model the values and behaviours he or she advocates.
A CEO should set the priorities that will rally the organisation’s workforce and resources towards translating the organisation’s vision into tangible business outcomes.
At the industry level, CEOs are in a strong position to push for necessary changes in practices or policies if we embrace the fact that sustainable business being the only way forward and as a strategic advantage.
Arshad: An effective coalition of CEOs also promotes the migration of ideas to action items.
Arshad: CEOs today need to have an informed perspective to brace for the impact of future business challenges and ensure business sustainability.
Talent management is essential. Currently, many organisations choose to adopt flow-to-work operating models, which create pools of resources that can be deployed flexibly and on demand. It is the role of the CEO to determine what works for an organisation’s talent management and execute it.
Moving forward, agility in steering the business is also critical. This can be done by effecting a practical operating culture. In addition, CEOs may also need to prioritise high-demand, sustainable products and services to discerning consumer segments that will strategically position their businesses for resilience.
Muhamad Umar: Never before have CEOs had to navigate through such challenges, with an ongoing pandemic and where climate change is the backdrop for the 21st century. Businesses must be able to brace for the long haul amid much uncertainty.
Therefore, CEOs’ role in championing responsible and resilient businesses becomes even more imperative, as there is now a need to make bold and unprecedented decisions relating to environment, social, and governance (ESG) as well as sustainability issues. CEOs today must reassess transformation needs where necessary, and set a clear tone and direction while prioritising the needs and welfare of all stakeholders.
Abdul Rahman: We have no choice but to collaborate to create the deep and meaningful systemic changes that are needed.
Abdul Rahman: As businesses, we have a crucial role to play, and a responsibility to help build a more equitable society and a resilient planet. Leaders such as CEOs, especially, have to lead by conviction and example in shaping the organisation’s purpose and driving action towards this sustainable future.
In CIMB’s case, making the sustainability agenda core to what we do is integral to our mission of being a purpose-driven organisation and this serves as a guide across all areas of our business.
Milne: Achieving carbon net-zero by 2050 is the greatest challenge ever faced by humanity. CEOs are pivotal in meeting this challenge by both facilitating change within their own organisations and supporting customers across industries in their transitions. This includes partnering with higher-emitting clients, to help them find a pathway to a low-carbon future.
K. Raman: A CEO shoulders many responsibilities, key among which is forging the path forward for the people within a business. As leaders, our top priority will always be our people – be it their physical and mental wellbeing, or their career development needs, we need to ensure that every person in an organisation is growing, and in doing so the business will grow too.
Most importantly, CEOs play a crucial role in shaping a culture that embraces responsibility and sustainability, in every sense of the word, and by leading through example while building a better world for everyone.
Aranols: Our purpose at Nestle is to enhance quality of life for everyone, today and for generations to come.
Aranols: CEOs play a critical role in setting organisational goals and creating a nurturing culture that’s capable to deliver it. A big part of a CEO’s role today is recognising that adherence to principles of ESG are essential to remain resilient and competitive.
At Nestle, this is driven through our Creating Shared Value approach which is embedded in the way we do business to sustainably create value both for society, shareholders and all stakeholders. This is increasingly linked to effectively tackling the undeniable and looming environmental crisis and that will only worsen if we don’t take action.
Imri: CEO and the board plays a pivotal role in setting the “tone at the top” and drive it within the DNA of the organisation as well as to external stakeholders – customers, investors, vendors and the public at large. Driving the ESG and sustainability agenda is a must to ensure business and economic growth is pursued in a balanced and responsible manner.
At TM, our ESG and sustainability blueprint is part of our three-year business and operating plan cycle, and climate control is certainly a prominent part of that plan.
How does a coalition of CEOs help to accelerate action (beyond dialogue)?
Tengku Muhammad Taufik: Addressing the daunting, complex challenge of climate change will require bold action. Working collectively as a group of leaders helps build momentum to move forward and bring stakeholders on board with the changes that are needed.
Having this platform to engage and deliberate on the complex aspects of the climate crisis is expected to help us develop a more meaningful response. Each CEO in the coalition offers a diverse set of perspectives and awareness of the developments in our respective industries.
As such, the coalition offers the potential to leverage on a combined pool of ingenuity and collective experience to transform ideas into solutions. The coalition would also help surface opportunities for cross-industry collaboration to accelerate and scale up sustainability efforts as a group.
Coming to policymakers as a coalition also offers the opportunity to present a unified voice, one that is able to offer credible proposals that have taken into account the different needs and abilities of all respective partners, as well as present a comprehensive ask for support in a way that benefits the whole of industry.
Arshad: Strategic collaboration is important, especially in the current challenging economic climate. To thrive in the new normal, CEOs must actively work with relevant stakeholders and business partners to innovate on business and operating models.
As such, a coalition of CEOs with various business backgrounds and expertise, creates a conducive platform for exploring and exchanging ideas. An effective coalition of CEOs also promotes the migration of ideas to action items. The key takeaway from the exchanging of ideas and a sharing of crisis experiences is that a company that knows how to select and engage partners creates a distinct competitive advantage.
Muhamad Umar: A coalition of CEOs voicing a unified set of commitments signals to the market that businesses cannot be conducted as usual, moving forward. Companies will need to focus on long-term sustainable business practices and prioritise stakeholders’ needs and values while maintaining a profitable business model.
As a coalition, we will be able to foster shared accountability, support and the confidence required for a significant shift in momentum for most businesses in general. Further, this would encourage the various capital market stakeholders to take a more proactive role in advocating for better ESG and sustainability practices.
Abdul Rahman: At CIMB, we recognise that each business on its own can only have limited impact, and we have no choice but to collaborate to create the deep and meaningful systemic changes that are needed. This is why we first mooted the idea of CAN at our inaugural Cooler Earth Sustainability Summit in 2019.
CAN was formalised in 2020, and just within a year, we have started to see considerable progress – through the Collective Commitments announced on Sept 23, strong interest in our capacity building sessions and a slew of policy recommendations that are scheduled to be announced soon.
Each of our members will have their own spheres of influence where they can effect change for the better. In CIMB’s case, as a financial institution, we play a critical role as a facilitator and intermediary of capital and financial flows. We can help to channel funds to areas that will positively impact society and the environment, while ensuring that our funds are not used in ways that harm the environment and community.
Milne: Achieving carbon net-zero by 2050 is the greatest challenge ever faced by humanity.
Milne: Reaching net zero is a universal challenge that can only be achieved by collective solutions and most importantly, meaningful action. CAN brings together diverse ideas and perspectives of the country’s leading senior executives helping us collectively to innovate, manage risks and grow the business landscape sustainably.
This is essential to drive progress across the country. By working together with policymakers and the community at large, we are focused on making change happen now, before it is too late.
HSBC is honoured to be part of this initiative which is so important to us all. We are bringing our full passion to the task and are committed to achieving the challenges ahead.
K. Raman: None of us can achieve greatness alone, especially when it comes to sustainability where time is of the essence.
K. Raman: At Microsoft, we are firm believers in the power of collaboration and partnership. None of us can achieve greatness alone, especially when it comes to sustainability where time is of the essence. Together, we need to drive greater impact through tangible actions that enable us to achieve our vision of a sustainable and inclusive future.
Through these strategic alliances and coalitions, we are in a better position to continuously engage both the public and private sectors to adopt sustainable practices and build a better future, together.
Aranols: We recognise that today’s challenges require collective action to bring about transformational change. An increasing number of companies, such as ourselves at Nestle, are pursuing an aggressive sustainability agenda but we see increasingly the need to build coalitions of like-minded stakeholders to accelerate change.
It is time to sum up efforts, skills, capabilities and experiences to drive positive impact. CAN will play a role in creating awareness and galvanising action across industries, in partnership with governments, NGOs and the public in general.
Imri: The coalition of CEOs enables peer learnings and healthy benchmarking of best practices across industries.
It provides the push for TM to continuously improve and remain progressive in our ESG journey. We also do learn from telcos in other regions whom are more advanced and we always strive to be at par with others globally.
We are mindful that our highest energy consumption today is our network. We continuously optimise our overall energy usage – shutting down legacy network and IT systems in modernising for more energy-efficient and technology advanced systems.
Additionally, TM is shifting to a hybrid working arrangement – a mixture of work from anywhere and from the office. This reduces the office space required and its associated utility consumption.
Imri: Our sustainability efforts are aligned with our commitment in upholding responsible ESG practices and good corporate governance.
What is your sustainability ambition or vision for your own organisation?
Tengku Muhammad Taufik: Petronas’ vision for sustainability is encapsulated within our statement of purpose: to be “a progressive energy and solutions partner, enriching lives for a sustainable future”.
My hope is that Petronas will fully live up to this aspiration as we continue to deliver energy and solutions in a way that is secure, affordable and sustainable, in contributing towards the progress of society for many more years to come.
Sustainability is not something that is new to Petronas. We have always endeavored to deliver social value and make a positive social impact wherever we operate.
Today, we are guided by our four sustainability lenses of Continued Value Creation, Safeguard the Environment, Positive Social Impact and Responsible Governance, which are aligned with the United Nations’ Sustainable Development Goals 2030.
Petronas was also one of the first Asian energy companies to announce a target to achieve net-zero carbon emissions aspiration by 2050, which stays true to our Statement of Purpose.
Arshad: The pandemic has changed the business landscape tremendously. Many companies have collapsed. Others are struggling to survive.
Yet, some are thriving. I believe what makes some companies more resilient than others is their ability to understand their foundational strength and leverage on this strength to turn challenges they are facing into opportunities, delivering better results and fostering sustainable growth.
I’m committed to realise the aspiration of my organisation, being a Development Finance Institution, to stay relevant and resilient in the post-pandemic banking environment and to align our business with the government’s post-pandemic agenda in support of the nation’s overall economic recovery plan.
My task now is primarily to make our business more pandemic-resilient and agile in the post-pandemic business landscape.
Muhamad Umar: Bursa Malaysia pledges to become carbon neutral by 2022 and to achieve net-zero emissions across its operations by 2050. We will continue to expand the size of our offerings through our product innovation, with greater alignment between syariah and ESG.
We also plan to strengthen our partnerships with the industry, to enable an ecosystem in ESG investing and facilitate innovation.
Abdul Rahman: CIMB Group aims to be an Asean sustainability leader by 2024. Under our Forward23+ Strategic Plan, the group has set a target to be in the top quartile of the Dow Jones Sustainability Index (DJSI) by 2024.
In order to achieve our sustainability ambitions, we have recently announced a set of strengthened sustainability commitments to accelerate our ambitions in this space.
On climate change, we have committed to achieve net-zero greenhouse gas (GHG) scope one and two emissions in our operations by 2030, and to achieve overall net zero, including our financed emissions (scope three), by 2050. We have also committed to mobilising RM30bil towards sustainable finance by 2024.
These commitments build upon our progress made in our sustainability journey, and we are fully committed to delivering them. To ensure that we do it, CIMB has established a new board-level committee called the Group Sustainability and Governance Committee that will steer and drive the sustainability agenda across the group.
Milne: Our ambition is to achieve carbon net zero across our own operations and direct supply chain by 2030 and across our entire business including our portfolio of financed customers by 2050. In support of this ambition, we will provide up to US$1 trillion (RM4.18 trilllion) of finance and investment by 2030 to help our customers get there.
In addition, we intend to make HSBC Amanah in Malaysia HSBC Group’s first sustainable banking entity globally by Dec 31, 2022.
K. Raman: At Microsoft, our mission is to create technology that empowers every person and organisation on the planet to achieve more. As we strive towards our mission, we ensure that every action we take as an organisation is also in line with our commitments towards sustainability, which includes going carbon negative, water positive and zero waste by 2030.
We are also actively researching and innovating newer methods of embedding sustainability into the technology that we develop, while using our voices and solutions to inspire our partners and customers to do the same and be part of our vision for sustainability too.
Aranols: Our purpose at Nestle is to enhance quality of life for everyone, today and for generations to come. This is a long-term vision that requires us to build resiliency and take action to address the climate change emergency and other environmental challenges.
Our Net-Zero roadmap specifies a time-bound aggressive plan to halve our emissions by 2030 and achieve net zero by 2050. We are going beyond this ambition. Doing no harm is no longer enough. We need to restore damage to nature, to soils and water sources. In some way we need to bring backwards the clock that measures human impact on the planet.
That’s why we have embarked into a transition to drive at scale regenerative food systems that will restore the soil, protect bio-diversity and ensure food produce and farmers’ livelihoods today and tomorrow. This is part of our vision to shape a brighter, greener future for all.
Imri: TM sees sustainability as both a responsibility as well as a business differentiator. Customers, employees and investors are increasingly more discerning in choosing companies that creates a positive impact on society and the environment, in addition to setting the “gold standard” in corporate governance.
As both a public listed company (PLC) and a government-linked company (GLC), our sustainability efforts are aligned with our commitment in upholding responsible ESG practices and good corporate governance. We are committed to sustainable growth, building on our strong track record as one of the 75 constituents in the FTSE4Good Bursa Malaysia Index, with the full rating of 4/4.
As we deliver Digital Malaysia through both connectivity and solutions excellence, we strive to progressively minimise our carbon footprint. This includes the usage of energy-efficient equipment and promoting the adoption of renewable energy practices, as well as enabling our customers from various industries to adopt more digital smart solutions.
If you are a CEO aiming to future-proof your business and your people while making a positive impact on the planet, do contact the CAN secretariat, managed by Dr Kishore Ravuri, founder and chief impact officer, Impacto Sdn Bhd at kish@impacto.my.
For more details, visit ceoactionnetwork.com
