We sat down with Aruna Jayanthi, Head of Canada and Latin America Markets at Capgemini, to talk about her roles within the company, the most recent analysis from Capgemini that highlights the growing gap between long-term goals and short-term actions, the most effective strategic approaches for businesses to use technology to advance sustainability efforts, potential solutions for businesses that believe the costs associated with sustainability initiatives outweigh the benefits, and challenges facing the industry.
Aruna is the head of Capgemini Canada and Latin America’s markets and is also the Group Sales officer for the Americas. She is a member of the Capgemini Group Executive Committee (GEC) and has held numerous leadership positions across India, Asia-Pacific, and the Americas. She is also an Independent Director on the Board of Michelin. Aruna was recently honoured with the Exceptional Women of Excellence in Business award, granted internationally by the Women Economic Forum. Past honours include inclusion multiple times in the List of 50 Most Powerful Indian Women by Fortune India magazine.
What are your duties as Capgemini’s Head of Canada and Latin America Markets? How does it feel to be recognized as the Most Powerful Woman in India by India’s top business magazine while holding key positions at Capgemini?
My focus is on working with our customers on business and technology transformation and ensuring this leads to the achievement of strong, measurable, and positive outcomes for these organizations. One of the transformation areas is around sustainability and I strive to bring the best of our global experience to this region while also learning from Canada and taking it to the rest of the world.
As a woman in leadership, and being recognized as the Most Powerful Woman in India, I know the weight that that title and this position hold. In my role and through my work, I want to inspire the next generation of women leaders as we work towards the common vision of creating more sustainable businesses across the world amidst the urgent need for climate action.
What do you think of the latest Capgemini analysis that shows the gap between long-term objectives and short-term actions because Canadian businesses don’t put sustainability at the top of their priority lists?
Sustainability is certainly on the C-Suite agenda in Canada and several organizations have published their long-term commitment to get to net zero as well as interim measures such as being carbon neutral in the nearer term. The question is not one of commitment but the path to make that a reality.
Our Capgemini Research Institute (CRI) report shows that 68% of Canadian business executives view sustainability is already a C-suite agenda topic but only 52% have a clear set of priorities and initiatives to be implemented over the next three years and an even fewer 29% are redesigning their business and operating model to be more sustainable. This highlights an existing gap between the commitment to sustainability and the tangible action being taken to enable sustainable change across the business.
I expect this gap is likely to close over the coming 12-18 months as awareness increases, maturity levels improve, executives start seeing the benefits of the initial steps and Boards also focus on and demand rapid progress on the sustainability agenda. Also, there are increasing expectations from external stakeholders including customers and investors which will add to the urgency of setting up an actionable program.
What are the most effective strategic approaches, in your opinion, for firms to use technology to advance sustainability efforts?
Data needs to be at the core of an organization’s sustainability transformation. Data is a significant lever in accelerating the journey to net zero, increasing visibility of baseline emissions levels, identifying emissions hotspots, improving existing business processes by streamlining carbon-intensive activities, and predicting and prescribing business outcomes to identify further emissions reduction opportunities. Using technology to build a data-driven organization is key to success with sustainability initiatives.
Investing in AI and automation allows organizations to collect granular insights which can help inform decision-making from a sustainability lens across different organizations’ functions. For example, we worked with a global hotel chain that reduced food waste by 30% (equivalent to 17,000 meals) through the use of AI technology.
Another example is the use of IoT technologies to reduce energy consumption. IoT technologies enable organizations to collect and analyze large amounts of data in real-time. This allows organizations to better understand how their energy consumption is tracking and identify inefficiencies in real-time across the value chain to reduce energy consumption and create a more sustainable business.
What are some potential solutions for firms that feel that the expenses associated with sustainability initiatives outweigh the benefits?
Unfortunately, several global as well as Canadian executives see sustainability as a cost driver and don’t have clarity on the business case. However, it is evident through our research that prioritizing sustainability throughout the organization’s value chain results in stronger financial performance. Organizations that we consider to be ‘front runners’ – organizations that have progressed to a greater degree than their peers in implementing sustainability practices – have experienced an 83% higher revenue per employee from 2020 to 2021 compared to the average.
There are several examples and use cases available today in every industry that demonstrate actions that have been taken and investments that have been made to improve sustainability in products, services, and operations and the resulting benefits. Some examples include the introduction of hybrid work culture and reduction in travel-related emissions, switching to renewable energy, incorporating circular economy principles into product design and driving waste reduction as well as redesigning products to reduce energy consumption.
It is essential to bring attention to the point that sustainability is a value driver instead of a cost driver and there needs to be a strong communication and change management program that helps create and articulate the business case, and the benefits and builds a level of excitement and ownership across the organization and make every success a matter of pride for the employees.
What challenges do you think organizations encounter on their path to sustainability? And what are the methods for overcoming those difficulties?
The first challenge is that it is not a holistic enterprise-wide program with clear goals that touches every individual and takes them along on the journey. That means a lack of transparency, questions around why something is being done, what is the benefit, and also perceptions of greenwashing and ‘tagging’ activities as being sustainable to demonstrate progress. This could easily be addressed with a strong governance program that includes change management and also links it to performance goals. Some of the leading organizations have linked measurable sustainability outcomes to executive compensation
There is also a talent deficit in this area, which aggravates the challenge. Recruitment and upskilling currently isn’t top priority for the majority of organizations. Organizations shouldn’t only work to instill a sustainability mindset amongst current employees – they should also hire employees who have sustainability skills such as carbon accounting, environmental science/engineering, renewable energy, or data analysis/visualization. These employees will be able to provide insight into current and future sustainability practices to help meet organizational and global sustainability goals. Our research shows that only 43% of Canadian organizations are recruiting for sustainability skills and 51% are upskilling/reskilling current team members with those skills.
In addition, employees aren’t fully supported in their sustainability journeys. They should be fully involved and enabled with the skills to support the organization through the sustainability transformation.
Some organizations also aren’t collaborating with key stakeholders. Opening up the sustainability transformation conversation to stakeholders will allow for new ideas and approaches to be presented by those who may have different perspectives and experiences.
Lastly, the current investment levels are insufficient. Larger companies are investing a smaller share of revenue in environmental sustainability when compared to smaller companies. We see that companies with annual revenue of less than $10bn are investing 2.2% of their total revenue, while companies with annual revenue of $10bn or more are investing 0.5% of their total revenue.
What specific advice would you like to give to Canadian leaders and organizations to assist them to close the gap and accelerate the process of changing into a more sustainable company?
I believe that organizations need to translate the commitments to action through a comprehensive enterprise-wide transformation program that addresses and embeds sustainability into all aspects of the business: into their products and services, into their operations and supply chain, and into the IT landscape while putting in a place a strong governance program and bringing in the right talent and expertise. And underlying all of this, is a data-driven approach that is measuring emissions, setting the baseline and tracking the progress and reduction in the carbon footprint. Also important is to extend this discussion and work together with partners and suppliers in one’s ecosystem to truly get benefits across the supply chain.
Every C-suite executive as well as the Board has a role to play in pushing sustainability. For example, at the top, the CEO must make sustainability a business priority to drive the company’s growth strategy. To support financial considerations, the CFO must articulate the business case for sustainability and ensure it is understood throughout the organization. From a reputational standpoint, the CMO must implement protocols to avoid greenwashing sustainability credentials. As part of the broader business model, the Chief Design/Product Officer needs to embed sustainability as a core design principle, and the Chief Procurement/Supply Chain Officer needs to work with suppliers to ensure they achieve sustainability goals. Across core functions, the CTO/CIO must strengthen sustainable IT initiatives, the COO needs to build the foundation of a sustainable organization, and, of critical importance, the CHRO needs to staff for sustainability, which requires new skill sets and a new leadership model.
