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One of the biggest debates during the Responsible Leadership and Sustainability module, of course, revolved around the age-old question: will a focus on sustainability erode profits? Industry practitioners were invited to weigh in on this and many other topics during an open discussion with ESSEC APAC's Global MBA and Executive MBA participants.
To Constant Van Aerschot, Director Asia Pacific at World Business Council for Sustainable Development, the answer is a straight no. After all, if businesses were to put a price on externalities created, they would probably find their profits are far lower than they think.
When he spoke at ESSEC, he drew attention to product life cycle analysis and the need for financial impact accounting — to measure the actual cost to the environment when a product is developed and used.
He notes that with the shift to a low carbon economy, there are opportunities to profit by developing innovations and products that fulfill market needs without having as huge an environmental impact.
What he hoped students would take away is that “businesses can choose to position themselves as a winner, or a loser, depending on how they make decisions.”
What he hoped students would take away is that “businesses can choose to position themselves as a winner, or a loser, depending on how they make decisions.”
Srikumar Misra, Founder and CEO of Milk Mantra, an ethical dairy startup, added to the discussion with examples of how systems thinking and technology have allowed him to develop a sustainable dairy-foods business, supporting over 80,000 farmers through ethical sourcing and impacting over a million people.
“Utilizing the right framework, profit and sustainability are one and the same, and a responsible business approach can generate outlier financial returns,” he explains, reiterating the need for sustainability to be at the core of the company's DNA.
Read the five-part feature on the Responsible Leadership and Sustainability course.
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