This speech was presented by Gopul Shah, Director, Corporate Treasury and Structured Trade Finance, Golden Agri-Resources, at the Responsible Business Forum in Singapore on 23 November 2017.
Having engaged with many of the delegates present at the Responsible Business Forum 2017 in Singapore, I am appreciative of the invaluable work being done that helps create awareness and action on building a sustainable planet and better human life. I am a personal beneficiary of some of these initiatives and believe that “Human Life, Laws of Nature and Planet Earth” are at the core of all sustainable business activities – we have got to manage risks, do it right or perish!
The event was centred around the theme of measurement, performance and impact of the Sustainable Development Goals (SDGs). Judging by the number of people who attended, it is evident that the UN SDGs 2030 have managed to resonate and capture the attention of private sector much more as compared to other initiatives like the Millennium Development Goals.
Why is this so? I believe it is because businesses respond well to risk and rewards. These days, business performance isn’t only about profitable growth – the new norm is to embed sustainability as part of core enterprise business strategy and corporate culture – placing people, planet and philosophy on par with profits.
As businesses, how do we start taking on board the SDGs in a meaningful way? These long term goals force us to think strategically and act sustainably in a way that helps improve the quality of risk-adjusted return on investment, promote positive business behaviour by doing it right, and create a sustainable business of repute for generations.
Many corporates are playing a key role in the attainment of the SDGs – they are aligning, refining, de-risking their business, improving the quality of stakeholder satisfaction and return on investment.
The palm oil plantation sector has seen its fair share of controversy, and as one of the largest producers, we at Golden Agri-Resources (GAR) treat sustainability as an ‘enterprise management strategy”. This means sustainable practices are embedded in our business initiatives, corporate culture, and actions. This strategic focus helps us proactively and successfully create a culture of sustainable practices, manage complex issues and risks linked to responsible palm production especially when it comes to forest conservation, environment protection, social and community empowerment and development, food safety and security, supply chain management, customer engagement and stakeholder management.
Corporates understand that sustainably is an important differentiator and a competitive advantage – in their journey to be a partner of choice and create a thriving business of repute and integrity.
My sincere thanks to my sustainability colleagues that successfully execute and manage various sustainability initiatives on the ground and report them through our sustainability dashboard and reports.
Let me offer you five examples of what we are doing successfully that deliver various SDGs while balancing profitable growth, improving risk-adjusted returns on investment and helping us to become a ‘partner of choice’ to our stakeholders.
- Our business touches the lives of tens of thousands of people – we provide much required agronomy skills, social infrastructure, roads, clinics, schools, and most importantly jobs in remote rural areas that empower and improve lives. This helps tackle various goals including goal 1 on elimination of poverty.
- We implement production-protection partnerships with local communities to achieve conservation goals – this helps achieve goal 13 and 15. Our initiatives such as the Alternative Livelihood Programme introduces organic farming to rural communities. This helps the communities earn extra income and strengthen food security in return for agreeing to conserve forests and peat lands.
- We have influenced and on boarded hundreds of our suppliers on our journey towards responsible palm oil production – delivering goal 12. We share our know-how and expertise with smaller players, helping them to become more responsible in their agronomy and production practices. As a result, this can have an effect on uplifting the entire industry’s standards.
- Our R&D teams have developed new planting materials that can deliver the highest yields per hectare in the industry (about 10 tonnes crude palm oil per hectare). This helps improve productivity from our existing plantations and smallholders, reducing the need for expansion of land for plantation and strengthening food security – delivering goal 2.
- We help smallholders through “innovative financing and agronomy best practice sharing programmes” in partnership with the Government of Indonesia and Indonesian banks that will potentially cover approximately two million smallholders and six million hectares (which is approximately 44%) of plantation land cover in Indonesia. This has the potential to improve the productivity of millions of small farmers and limit the need to add new land for palm oil while boosting incomes and standards of living of smallholders, in line with the intentions of goal 2.
In conclusion, it is our experience that the balance of profitable business coupled with good governance, environmental and social good has a multitude of benefits. It helps improve the risk profile of businesses; strengthens food security; increases product and service offering; enhances customer satisfaction, corporate reputation, stakeholder and employee engagement; improves quality of human life, community and talent; improve quality of earnings and risk adjusted returns.
The SDGs offer a unique framework and opportunity for organisations to strengthen sustainability initiatives, improve the risk profiles of their businesses and deliver a thriving business of repute with improved risk-adjusted returns.
Gopul has over 10 years of experience in corporate finance, treasury, trade structured finance and international commodities trade and has held senior management leadership roles in Singapore and India. Gopul holds an MBA from the University of Chicago Booth School of Business, a Bachelor’s degree in Commerce from the University of Mumbai and is a Chartered Accountant by training.