Podcast - Take 1

In the first episode of Sustainability at Work, the hosts introduce the podcast's purpose, which is to showcase how MBA graduates are driving positive change in their industries towards sustainability. They will explore stories of changemakers and learn about the challenges and opportunities in sustainable business. The first guest, Duncan, talks about his role in philanthropy and making education more accessible. He discusses the role of charities in promoting sustainability and the risks of greenwashing. The second guest, Reece, explains how his company, SupplyShift, helps organizations improve their sustainability strategies. He emphasizes the importance of looking beyond a company's direct control and focusing on the supply chain's impact. He also discusses the shift towards considering ESG performance and the steps organizations can take to build a sustainable supply chain. Welcome to the very first episode of Sustainability at Work, where we delve deep into the dynamic world of business and its transformation towards a sustainable future. Today we'll lay the groundwork for our exploration, setting the stage for the exciting discussions to come. We're your co-hosts, Jessica and Nabil, and we couldn't be more thrilled to embark on this journey with all of you, powered by Audacity and the Lang School of Business at the University of Guelph. Sustainable development is about meeting the needs of the present generation without compromising the well-being of future generations. It's a concept that demands thoughtful consideration and actionable solutions, which may be really challenging to do. The focus of this podcast is to demonstrate ways that MBA graduates are driving positive change in their respective industries. Throughout each episode, we'll be inspired by the stories of changemakers leading the change towards a more sustainable future. Our guests will share how businesses are going beyond superficial sustainability efforts and integrating it into their entire value chain. We'll learn from industry experts about the challenges and opportunities that come with the transformative approach. So whether you're a seasoned business professional, a current MBA student, or someone interested in making a positive impact, join us as we explore the world of sustainable business and how we can shape a brighter and more sustainable future, one episode at a time. So in today's episode, we will be welcoming three MBA students who have played a key role in the sustainability space. Each guest brings a variety of unique perspectives and experiences, which Nabeel and I will be drawing on. Duncan Malcolm is our first guest and is currently employed as the Director of Advancements at the University of Guelph. In his role, he oversees managing the operations side of the university, including functions in IT, HR, risk management, legal, and many more. Duncan is also a seasoned expert in philanthropy and its crucial role in the fight against climate change. Thank you so much, Duncan, for joining us today. So Duncan, how are you assisting your company in driving positive changes in the sustainability space? Yeah, thanks, Jess. Thanks for having me on. You know, the area of work at the University of Guelph that I'm in is all about raising philanthropic funds, which you kind of mentioned in your intro there. Specifically, I have a role in approving scholarships and awards and things like that. And a big part of that is to make education more accessible. And we know there's a big part of, you know, positive social impact and economic impact in, again, that kind of accessibility to education. When I was at the Nature Conservancy of Canada, which is a land conservation organization, it was about building partnerships, right, partnerships with governments and individuals as donors, with corporations, even working with other charities to solve the challenge of habitat loss and address climate change. Amazing. It sounds like you have a lot of experience in the area. So what is the role of charities or what role do you see for charities in promoting things like sustainability? Yeah, whether it's the university or NCC, you know, NGOs, and here we're talking about nonprofits, we're talking about charities, community organizations, things like that. They have an important role in bringing publicity to issues and holding policymakers, corporations, governments to account. And that can be kind of an adversarial kind of way. In my experience, it's been softer influence, you know, working as kind of trusted partners with other organizations. Raymond Bryant calls this the kind of moral character, right, that A, attracts attention of media policymakers and the general public, and B, results in change. And there, you know, we can think of a lot of examples of this kind of thing. We can think of groups like Greenpeace and some of the attention that they bring. Certainly, that's more of an adversarial approach, whereas the University of Guelph and NCC are more about, like I said, kind of that softer influence part. Awesome. So when you're thinking about philanthropy in general, what type of opportunities do you see for those who are interested in pursuing something in sustainable development? Yeah, there's a number of opportunities there. And again, you know, leaning back to this idea of partnerships, philanthropic partnerships can result in, you know, being able to deploy, you know, specialist expertise, bring a higher level of risk tolerance compared to government agencies, maybe be a little bit more nimble and act more quickly, or the opposite, which is about, you know, idea called patient capital and this idea of, you know, deploying resources when they're needed to kind of get the highest return. It's also a two-way street. Erin Agrawal talks about how corporate partners can benefit as their actions receive greater social legitimacy, and NGOs can benefit through new sources of finance to support their efforts and that certainly has been my experience with NCC and with the university. If we focus in on environmental causes, historically, philanthropic grants for that area have been small compared to the overall philanthropic opportunity. In 2020, McKinsey did some research and found that there was about $62 billion just in the United States given to, you know, kind of the big buckets of charities, and climate and environmental causes was only $1.4 billion of that, and so if we think about kind of wallet share for that environmental group of charities, you know, there's this huge opportunity for growth for sure. Amazing. So, of course, when you think about opportunities, one thing that comes to mind are risks. So what type of risks come with these opportunities? Yeah, and if I go back to building kind of corporate partnerships, well, again, both at the university and at NCC, you get into the idea of greenwashing, right? But to be honest, those risks exist with, you know, social washing, with pinkwashing, rainbow washing, all sorts of different spaces for sure, and it's not only a risk for the charity but also for the partner corporation, and that is a reality. The big question is how do you tell if it's greenwashing or pinkwashing or social washing and at what point does the philanthropic intent turn into self-interested and shallow promotion of kind of perceived social good? There's good news and there's bad news. The good news is that there is a way to tell, but the challenge is that it falls a lot on the public or the consumer to learn about organizations and assess other organizational values. One piece that people often look to is the level of transparency in regards to ESG information sharing, so usually where we have high levels of transparency, that means genuine concern for social good, and less levels of transparency, obviously, that's an area of concern. That's a lot of knowledge and engagement to ask of the general public, but to be honest, that could be maybe another topic for a whole other podcast. Sounds great. We'll have to invite you back to the show. Thank you so much for your time, Duncan. We're going to be moving on to our second guest now. Thank you, Jess, and Duncan as well. Our second guest is Reece Poirier. He's a business development manager at SupplyShift. Reece has worked closely with some of the world's largest organizations, assisting them in moving their sustainability strategies forward with innovative tools and services. Reece will be discussing how both large and small enterprises in any sector can and should take steps to build a more sustainable value chain and how to sell this transformation internally. Reece, welcome to the show. Thank you so much for having me. Awesome. The first question I have for you is, how are you assisting your company in driving positive changes in the sustainability space? Well, SupplyShift is a supplier-issued data management and performance improvement software network. Typically, business development's role is to build connections for the sake of making a sale, but in the sustainability space, that role is something of an evangelist. Most of the time, I'm convincing executives that they should, one, do something about supply chain sustainability, two, that there's a path forward, and three, that there's a business case for this. Very interesting. The second question I have for you is, can you tell us why it's important to look outside of a company's direct control and where we stand with efforts currently? Yeah, of course. The supply chain accounts for about 70 to 90 percent of an organization's impact. We're taught in operations management that the most successful organizations consider their suppliers an extension of their workforce, and that's certainly true in the real world when you look at things like quality control and financial health, but has not necessarily been the case for human rights, environmental management, and carbon emissions until very recently. That's interesting that this shift only started recently. What do you think has caused this shift specifically? I think there's really two things that clicked into place. The first is the financial community's realization that ESG performance and financial performance are inextricably linked, and that future climate change impacts will have a profound effect on their investments. The former is largely due to populist environmentalism and the demonstration by funding organizations like Pepsi and Shell of what can happen to an organization when they lose the social license to operate. So if an organization wants to be proactive and build a sustainable supply chain, what should they be doing exactly? We've always advocated for a crawl-walk-run approach if this is something that you've never dealt with before. As in any relationship, we say communication is key. So your suppliers will need to understand why you're doing this, why they're going to spend hours, days, or even weeks providing you with their data, and what you're planning to do with it afterwards. They'll be terrified of you terminating their contract or using information to cut them out of the chain. Typically, the most successful programs go for transparency without consequence first. A lot of companies think that they can just replace so-called bad suppliers, but really the overlap between the right price, right location, right product, and right ESG performance is so incredibly small that it's just isn't realistic. So more often than not, you'll have to work together and guide them toward better ESG practices. And what does that entail exactly? And the second part of that question is what do those relationship management look like? At the end of the day, it looks like setting SMART goals with them, and their engagement can be contractually bound. So obviously things like regulatory compliance and issues of child or forced labor are deal breakers. I'm talking about things like reducing carbon emissions or working toward an ISO certification. It sounds like a lot to handle, and it is. That's why a lot of people use software like SupplyShift and or include a consulting firm to handle the engagement. It's interesting what your company is doing, and how do you convince upper management to take this on if it's such a big lift? That's honestly why most people don't, actually. Usually it starts with an internally created survey or code of conduct to give the company plausible deniability for noncompliance. And then once they hire a sustainability person to respond to their customer surveys and help their public image, they usually dig into it and try to do a bit more, but it quickly gets out of hand. A good sustainable procurement program can easily run in the hundreds of thousands of dollars, and the ROI is seen typically as intangible or to the command and control generation a money fit. It's interesting that you mention return on investment. Is this return on investment intangible? No, actually. There is a written report by the World Economic Forum and Accenture that found that if you follow best practices, you save 9 to 16% on procurement costs and can increase your revenue by 5 to 20% on average. Large organizations also mitigate reputational risk. And those subject to various supply chain human rights and carbon disclosure laws don't run the risk of noncompliance by taking this on. What about building circularity into your operations? I hate to say it, but true circularity at this time is largely theoretical. So we've seen some early examples from companies like Xerox and H&M where they take back their products at the end of their life for refurbishment, and no doubt that's the direction we need to move in. But there's also the problem of reverse logistics. So the cost of reverse logistics versus buying new material can be neutralized, but at this time we don't have the infrastructure to not create carbon emissions from these efforts. There's also the issue of controlling consumer disposal behavior, and that's largely dependent on education. So in my opinion, recyclability and compostability is the best route right now. Interesting. The final question I have for you, Reece, is if you were an entrepreneur or freshly graduated from the Lane MBA Sustainable Commerce Program and were looking to build the most sustainable supply chain possible from scratch, what would you do? That's a big question. It largely depends on which industry you're in, what position in the supply chain you take. Before you even start vendoring, you should spend a lot of time and energy on product or service design, planning for things like the reusability of parts and packaging, the estimated embedded carbon of certain components, human rights risks, sourcing certain ingredients or elements, impacts on human health, et cetera. When it comes time to pick suppliers, your big ones will be easy. So they'll have public sustainability reports, sustainability ratings, et cetera. The smaller ones will be harder. So try to make them as local as possible, both for community impact and for logistics. You can look to certain databases or chambers of commerce for minority and women-owned businesses to diversify spend. In all cases, your expectations for sustainability performance and ongoing engagement on sustainability, like take-back programs, producer responsibility organization affiliations, et cetera, should be made clear in your contracting and onboarding process. Well, thanks a lot, Aris, for joining our podcast over here. Now we'll be moving to our third and final guest, Kyan Kelly, who's an account executive at Epsilon. He has spent the last four years studying and working in the automotive industry, and he will be describing how he is leveraging his knowledge from the MBA program in driving positive environmental sustainability in the electric automotive industry. Topics to be covered include how Epsilon has implemented sustainability measures in the company and how public policy shaped private industry. Kyan, welcome to the show. Yeah, awesome. Thanks for having me. So I'm going to start you off with a nice and easy question. So how are you assisting your company in driving positive changes in the sustainability space? For sure. So Epsilon is a marketing company and a subsidiary of Publicly Traded Publicist Group. Publicist has set the sustainability goals of increasing our use of renewable energy and achieving carbon neutrality by 2030. As an employee of Epsilon, I assist the company in driving positive changes by taking public transit instead of driving to the office and working in my home office during off-peak energy hours. That's awesome how you've incorporated that into your lifestyle. So what does sustainability at work mean for you? To me, it means adopting a mindset that our economy is meant to work for everyone and everything, including the environment. It means implementing strategies to ensure future generations have access to resources and modern technology. And it means taking a more humanistic and environmental approach to business. I think the profit-first approach must be left in the 20th century. Awesome. And how did it get introduced into your company? Well, at Epsilon, management has taken steps to eliminate unnecessary waste, conserve natural resources, and protect our global ecosystems to support well-being now and into the future. The company has partnered with the Nature Conservancy to support environmental initiatives such as tackling climate change, protecting ocean, land, and fresh water, and providing food and water sustainability. Further, as a part of our operation supporting dealerships marketing around North America, the studio and development team have added marketing communications for electric vehicles. Awesome. And if you were starting your own business, how would you implement this exactly? I think if someone is starting their own business, they can implement sustainable business practices by adopting a circular economic business model. The circular economy is a model of production and consumption that proposes creating products with the end of their life in mind. Such schemes include sharing, renting, reusing, and recycling existing materials and products. In this way, the life cycle of the product can be extended for as long as possible. Entrepreneurs can also implement practices such as using renewable energy, going paperless, and encouraging employees to use public transportation or bike to work. Awesome. And what are some of the relevant trends, challenges, opportunities, and risks in the automotive industry, just for our viewers? Yeah, for sure. So, I think the most relevant trend in the automotive sector is the push for electric vehicle sales. We know the government of Canada has set a target for new electric vehicle sales only by 2035. Various other Western governments have similar timelines as well. These mandates have forced vehicle manufacturers to increase their electric vehicle product offerings. In a recent report by the International Energy Agency, electric car markets are seeing exponential growth as sales exceeded 10 million in 2022. A total of 14% of all new cars sold were electric in 2022, which is up around 9% in 2021, and less than 5% in 2020. So, clearly, public sentiment is pushing demand. As for the opportunities, EVs need batteries and infrastructure development, and both opportunities create good-paying jobs for Canadians. There is a $5 billion investment in a plant to manufacture batteries for EVs in Canada, which will position the country as a global leader in EV manufacturing supply chain. The battery facility will be located in Windsor, Ontario, and will supply to Stellantis plant in Windsor and across North America. The facility should be operational by 2025, I believe. Some of the challenges and risks associated with EV adoption are the waste created by the battery manufacturing process and the amount of material needed to create the batteries. Critics of EV adoption often question whether EVs are actually better for the environment or if Western governments are just virtue signaling. In my opinion, EVs are fun vehicles if you like performance, but to practically address climate change in the transportation sector, I think a solution must be created to upgrade all the existing vehicles on the road. By 2035, there will still be millions of internal combustion engine vehicles on the road in Canada and in the world, and they will remain in operation for decades after that. Upgrading these existing vehicles to hybrids, I think, is a much better solution. Thanks a lot, Kai, and it's really interesting how the automotive industry is pushing for a more sustainable environment. And now I'll pass it off to Jessica to end it for us. For sure. Thank you so much. It's clear that our guests today have offered valuable insights into representing sustainability within their respective areas of expertise. Each guest brings a unique perspective that highlights the multifaceted approach to integrating sustainability into various aspects of business and industry. MBA graduates hailing from diverse industries are tasked with the responsibility of integrating the knowledge that we acquire within the classroom into daily endeavors, transforming theoretical insights into practical solutions. The insights from our guests here today highlight the importance of aligning values, policies, and practices to drive positive change. So thank you all so much for joining us in this inaugural episode of Sustainability at Work. Don't forget to subscribe and stay tuned for our next episode where we'll welcome even more guests to share the remarkable stories of MBA graduates driving positive change. Until then, keep envisioning a world where business and sustainability thrive hand in hand. Take care and we'll catch you in the next episode.