Remotefulness

Many companies are making very ambitious net-zero commitments without having appropriate plans in place

We meet Pedro Olazabal, co-founder of Hands-on-Impact and impact measurement specialist.

How would you describe yourself?

I am an engineer by background and entrepreneur by conviction. I am pragmatic and results-oriented and always thinking about what I am doing next. I am the co-founder of Hands-on-Impact a boutique sustainability and impact consultancy which helps companies develop sustainability and impact strategies but also provides measurement, analysis and management of impacts.We are a team of 5, working remotely for clients based in Spain, France, Dubai and Germany.

What motivated you to become a sustainability professional?

I have been a sustainability and impact measurement professional for 7 years. After graduating as an engineer, I worked in the renewable energy sector for a while. From the beginning, I have been involved in social movements like Economy for the Common Good, Platform for a New Energy Model, Engineers Without Borders. A couple of years ago, I decided to set up a consultancy in order to promote sustainable development in the private sector. The public and the charity sector are important in this debate but the private sector is critical to produce scalable and innovative solutions to counter the social and environmental impacts that we face. 

You have very diverse and rich experience promoting and advising on sustainability for many different organisations and sectors. Tell us about the learnings throughout your career in terms of impact measurement and sustainability.

At the end of 2015, companies still viewed sustainability as philanthropy. This has now changed and it is no longer considered a “nice to have” or an add-on but an integral part of how you make money and run your business. We encounter a mix of motivations but increasingly we find companies who are genuinely interested in mapping their impacts and then make strategic decisions to reduce their negative impacts in society and the environment while enhancing the positive ones. My key insights in doing this work with companies are threefold:

1- You need to make it easy for companies by integrating sustainability measurements within their company KPIs. The key challenge is to make sustainability indicators relevant to business targets.

2- There needs to be a shared understanding in terms of the sustainability scope of the project and what needs to happen. Sustainability covers different things to different people so it is critical to hold a kick-off meeting/training in order to manage expectations and achieve alignment on sustainability transformation goals.

3- Many companies don’t have the time or resources to project manage the sustainable transformation so it drags on and never gets implemented. That’s why we set out a timeframe and milestones jointly with the company but lead on the overall project management.

What evolution have you witnessed in terms of sustainability interest, focus and savviness from the corporate world in the last few years?

Like I said above, sustainability used to be associated with CSR and philanthropy only a couple of years ago. From 2018 onwards I started to get more questions about strategy when talking to companies. A critical change has indeed taken place. This shift is not only driven by consumers – where we see a gap between what they say in surveys and what they effectively buy. Critically it is driven by the more advanced and stringent regulation being adopted everywhere and by investors’ clear messages that companies’ accountability extends to all stakeholders, not just shareholders.

Sustainability used to be associated with CSR and philanthropy only a couple of years ago but a critical change has indeed taken place.

Where do you think there is more potential for leading climate progress? Do you have any good examples of companies you’ve worked for?

The key now for companies committed to climate change is to achieve net-zero emissions. This concept has now superseded the more narrow “climate-neutral” concept as it forces companies to reduce 90-95% of their emissions and offset their residual emissions with internationally certified projects to remove CO2 from the atmosphere. Implementation of renewable energy and efficient energy strategies is also critical for companies and an easier goal as increasingly market prices level up with non-renewables.

Net-zero strategies and technology deployment are two pillars in the fight against climate change. Obviously for some industries which need very high temperatures to operate (like the ceramics sector) some new and expensive energy sources – like green hydrogen – will not be an option for their net-zero targets. Yet, it may well be in 2040 when the technology has matured.

Having said that, many companies are making very ambitious net-zero commitments without having appropriate plans and strategies in place. In one recent interview, Sundar Pichai, the CEO at Google, was asked how they were going to deliver on their carbon-free promises. He was visibly anxious as he acknowledged that he wasn’t sure how they could accomplish that target. ““It is a moonshot (…). So it’s a bit stressful, because we don’t fully have all the answers to get there.” Plans and roadmaps need to be robust and realistic. A 2030 timeline is not a viable timeline for most companies if you include all relevant emissions (not only scope 1 and 2) and if the target is net-zero( instead of climate-neutral). We work with our clients to develop credible plans for their net-zero targets by 2040. Currently, two of our clients are putting these plans to their Board for formal approval.

What are the key sustainability trends innovative companies need to be aware of and start preparing for?

Net zero is a critical one as discussed above. Another one which is becoming increasingly important is supply chain management and due diligence from a human resources, child labour, labour righst perspective. Many companies delocalise their impacts, for cost savings reasons, and then lose control of risks occurring in those countries. Transparency and traceability are therefore two key areas companies need to be preparing for. There is a European Commission legislative proposal on due diligence in the supply chain in the pipeline. In the future, consumers will be demanding to know the provenance of products and whether fair practices have been applied throughout the supply chain. We help our clients in this area by analysing the providers, sectors and geographies where they operate so that we can come up with a robust risk map we can use to pre-empt problems.

In the future, consumers will be demanding to know the provenance of products and whether fair practices have been applied throughout the supply chain.

What advice would you give to SMEs and start-ups willing to start the sustainability journey and become responsible agents of change?

If you are an impact start-up, you should consider applying a Theory of Change analysis to map your activities and the intended impacts which will allow you to set appropriate KPIs to drive the transformation strategy.

For an SMEs, you’d need to understand who are your key stakeholders, be it investors, clients, employees etc. and then work out your 4-5 material topics. On that basis, designing up to 10 relevant KPIs would be helpful to measure and monitor progress, typically every 6 months.

I would also advise SMEs to put together an internal ESG report focusing on progress and areas of improvement which can be shared externally in a shorter version to encourage consultation and feedback from stakeholders.

What skills should a company promote and reward to adapt to a new work environment and what is the best way to achieve that goal?

Companies need to be very alert in terms of upcoming regulation as well as of investors and clients’ expectations. They are the biggest business drivers on the horizon. In this changing context, companies need to equip their teams with appropriate knowledge on sustainability ESG issues so that they are able to avert risks and tap into opportunities. Finally, in order to retain talent companies need to infuse their teams with a sense of purpose and autonomy to deliver on their projects.

It is increasingly challenging to be on top of all the sustainability developments in every geography and sector so, in our company, we create “owners”. As such, we block a number of hours a week to filter out the swathes of new information we receive on a daily basis. Additionally, we work remotely so autonomy is crucial. That is a key motivation driver for our staff. We keep communication and alignment in check through all staff daily 10 min-meetings and 50- min meetings on Fridays to share progress with the rest of the team. We use tools like Slack, Google Drive, Kanban, and a work satisfaction tool called Nailted. Finally, we meet at on-site retreats on a quarterly basis so that we can work face-to-face on our OKRs and also develop team cohesion by spending quality time together.

In this changing context, companies need to equip their teams with appropriate knowledge on sustainability ESG issues so that they are able to avert risks and tap into opportunities.

What keeps you motivated to continue this sometimes seemingly thankless career of pushing for systemic change?

I am very optimistic by nature and recent developments give me cause for hope. Over the past 2-3 years we are seeing so many developments in the right direction i.e. regulation, investor community involvement, corporate net zero pledges –  that it would be dishonest to show pessimism for the future. But we need to keep the momentum going!

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