How ESG Can Transform Your Business with Tunde Agoro of RPS

Foreign. Welcome to the Building Sustainably podcast by rps. Sustainable resilient development demands a new approach to how we plan, design and build. We invite you to join us as we explore real life case studies and offer practical guidance. Here's your host, James Bowman Tunde. Thank you for joining us. Looking forward to our discussion today on esg. Thanks James. Pleasure to be here. Would you mind starting us off with a bit of introduction about yourself, some of your background, maybe your journey, because you have quite an interesting background, how you've come to be in the role of Director of ESG at RPS? Yeah, sure, absolutely. I'm privileged to be looking after RPS's award winning ESG and sustainable business team here. We are a global ESG advisory consultancy because our clients are global and I have over the last decade or so been privileged to also hold several technical and strategic leadership roles in multidisciplinary engineering and consultancy firms in the uk, including the likes of Akom, Paul Lee, who are a sister company to us now in Tetra Tech and Hydrock as well, who's now been bought by Stantec, one of the key players in the industry to date. But in my journey, believe it or not, I started out as an architect looking to design towers and cities and the likes of it. So going through architecture, urban regeneration projects, I got really, really interested in the impact of buildings on the built in natural environment. So that generally led me to a Master's degree at Imperial College in London where I did environmental engineering and that introduced me to sustainable. My lecturer on that module was the chief scientific advisor to the Prime Minister at the time, Professor David Fiske. He enthused me with so much passion for sustainability thinking that I thought that is what I want to do. I got an ACOM in the Sustainable Development Group and that grew through assessing the environmental sustainability performance of human individual buildings and developments all around the UK using established rating systems and then Briam for Offices which is created in 1990. You know, the very old schemes, you know and of course you know you have much newer schemes to date. But that's where my journey started from. It started from building design, looking at making buildings, you know, and developments more environmentally sustainable. And during this journey I found a big challenge around how you translate ambition to outcomes. Most times clients don't even set an ambitions themselves, you know, and what they're doing doesn't quite marry up with what you know, we want to see on a development. And that led me to asking those challenging questions around how do we marry the two. So yeah, and that's led me to, you know, being part of several sustainability panels within the various consultancies where I worked. Because I thought, well, we should be able to at least walk the talk. And I feel like it's more powerful. There's nothing quite as powerful as not just telling a client what to do. They're saying, hey, look, see what we did? You can do likewise. Sure, yeah. We don't just advise on this, we practice it. Absolutely, absolutely. Walking the talk. So that led me, if you like, going from technical work to more operations work, creating forums for champions all around the offices, you know, creating working groups and, you know, and all that kind of good stuff, you know, and I quite enjoy that because I was able to do some amazing things, you know, in that particular space. You know, one of them was being able to actually Orly's own Climate Emergency Response Action Plan, helping Orly actually create their own sustainable development framework, which is currently being used till date. I was able to help I drop their first ever ESG strategy as a business, you know, so all of all that culminated in me, you know, pivoting into the jewel of esg. So I like to say ESG found me. So I kind of transition from looking at projects and developments to actually trying to impact on organizational behavior, to developing strategies for how businesses can embrace, you know, the climate emergency and translate that to operational actions. Fantastic. Well, thank you for sharing that with us. I can sense the passion as you describe all of that, and it's potentially surprising, but I find it refreshing to hear that something found you rather than you went and found it. I think there's a lot of people who get on a bandwagon of environmental things are seen to be important or lucrative, and so let's go apply ourselves there. Whereas you have seemingly quite a natural affinity and interest in it. So I'm looking forward to our conversation today. Getting into the topic at hand, esg. Can you give us your view, summary and explanation of what is esg? People who may not be familiar, or at least to set the context for us today, I think a very layman's term. I like to tell people ESG is pretty much a proxy for sustainability. So sustainability as we know it in consultancy in the build sector, you know, relates a lot to how we measure the performance of buildings, infrastructure and development. ESG could be seen as a way of measuring pretty much the same thing, but at an organizational level. ESG itself is an acronym for Environmental Social Governance. And as we know it, it was created by the United nations about two Decades ago, been around for a little bit, but it's still relatively new to be honest. But it was created particularly for the financial and services sector as a way of measuring their non financial performance. And it's been used as a way investors to test, you know, the material risk, you know, inherent within the business or a project before dipping their toes in or getting into bed, you know, with an organization. So it has been used to measure non financial performance and also to measure material risks, you know. So looking at environmental, social and governance as the key themes. Yeah. And both risk and opportunity. Risk and opportunity, of course. And of course because it's been used by investors, basically, you know, it's trickled down beyond the financial and services sector to every other sector where development of fund is required from investors. So real estate for example, was one of the main hit sectors by esg. And of course energy, renewables, all of all that, they all got caught up in that because they had to report to investors, to respond to investors questions and questionnaires around ESG performance and ESG factors. And so starting at the start and thinking the 20 years or so, well, the phrase or the goals have been around, what have been some of the key milestones or evolution points that you've seen in your time? I think one of the most significant things I've seen is the fact that ESG has become a topical issue. It's no longer an add on meeting agendas. It's kind of found its place in the main body of programs and meetings and discussions. I would argue two, three decades ago, we still had to create a business case for sustainability as an agenda. Already it's sold itself. Right now it is the business case that you then build off of. Yeah, so that's significant. One of the things I've also seen as well is sustainability and ESG having a sit, you know, on the boards of organizations. Completely unheard of. You know, we are having CSOs now Chief Sustainability officers in major corporations and businesses, you know, all around the world, showing, you know, the importance that's been accorded to that particular subject. So yeah, two big things that we have seen in addition to the plethora of regulations, frameworks and standards, all pushing the boundary of technical disclosure of performance measuring. It's just a lot hitting the industry, hitting clients and businesses and project delivery team. And it's been very exciting to say the least. Yeah. Okay, so building on that, what you've just finished with there, how it has exploded, how much there is in the marketplace right now, it would be Quite easy for someone who's trying to start this process or trying to get engaged to feel fairly overwhelmed with everything coming at me. What do I do? Where would you recommend starting? If you are either in a corporate role charged with drafting an ESG strategy or potentially career wise looking to make a transition into esg, Some suggestions or advice on where to start? Potentially two there, what about careers and what about if you've got the job already but you need to draft the strategy, so tackle that how you will. Let's start with people that want to actually deliver ESG strategies. So as an organization, where do you start from? I think more often than not my, my advice usually is let's start from where you are, right? Let's understand, you know, what you got as a baseline position and then understand where you want to go from there and then probably identify where the gaps are, what are the key focus areas. But beyond that, I always like to start with why. And the reason for that is that if you're doing ESG just for the purpose of responding to crashers or clients request and it's not part of an intrinsic desire and recognition of a social purpose, you know, it's going to fall apart very quickly, it's going to become a burden because it doesn't get properly integrated into the DNA an organization. So understanding your why and how that, you know, marries with an ESG strategy is really important, you know, so we would probably typically start with something like a vision design workshop to trash that out, set a very clear ambition, you know, and then we then go on to the gap analysis, materiality assessments and then the likes of it. For someone who wants to get involved in ESG as a career again, I'll ask you why. Would you want to do it, you know, and you know, it's important, like you mentioned James, you know, to have the right passion and interest in any career, you know, in order to flourish, in order to thrive, you know, in order to be able to feel significant, you know, and make any sort of reasonable impact or contribution, you know, in, in, in, in, in the list. I mean, and, and if, if you're really interested in this, you, you need to find mentors, you know, find people that, that you can tap on the shoulders that can give you a bit of a hand holding. All right, so their mentors, their. Personally as an individual, you've got to immense yourself, you know, in, in the trends, right? What's the history of esg? What are the, you know, the, the policies, the direction of travel, you know, what are the Pinch points for organization. What is the problem and challenge we are trying to, to solve it might mean going to get a specialist master's degree in one of the related subjects. For example, it might be joining a professional body. IIMA is Environmental Management and Assessments or any other related professional bodies in the build sector. You know, and you know, getting yourself immersed, you know, in that subject matter. There are lots of free webinars and seminars you could get to upskill your knowledge as well in the areas. Yeah, okay, some great advice there. You touched on earlier companies, organizations starting with their why and then building that into the DNA of their business. And I'd like to expand on that a bit more in terms of how have you seen businesses or what have you seen hopefully where businesses have done it well and got that true connection or true integration of ESG and the business's DNA. Put it a different way. Where does it go well and where does it not go well? So that's, that's a lot of good question as well. And going a bit more into more detail there as well. I think where a doesn't go well is particularly where it becomes a tick boxing exercise and you find that the organization is basically trying to respond to compliance requirements as a minimum. So what is the list we can do to make this stuff disappear? I just want to be in the black, I don't want to get in the red. You know, it basically takes all the joy out of it, right? It becomes an agile strainers exercise. It becomes burdensome, right? There's a lot of pushback on, you know, lots of great ideas, you know, and innovation, you know, and it's just becomes comes down to production ground and it's, it's just makes it lackluster and stuff that people don't want to engage with, you know, so you like engagement, you like buy in, you know, and it will end, end up on the shelf gathering dust till the next season where you need to obtain the checklist. So that fails clearly and it doesn't do what it needs to do. An example where it is really successful is where, you know, an ESG strategy is fully integrated into a business's operation. So basically it's there, but it's not there. Just effortless is effortless. It doesn't constitute an additional administrative burden or challenge for project managers, for operation unit leaders, for program managers, for various engineers, consultants or employees. It's seamlessly introduced as part of the bottom line, you know, and in order to do that, you know, it can't just be top down. It's got to have the top down and the bottom up, you know, approach. There's got to be a buy in, there's got to be an engagement from all relevant stakeholders, which is why you've got to start with the. Why you've got to engage all relevant stakeholders. You've got to carry everybody along in that process. Right? You know, you've got to identify the things that matter the most to you. Not just you as a decision maker, but to the interested parties, to the delivery parties, to funders, to your entire value chain, you know, as a whole, you know, and then you create a strategy, a vision that actually resonates with everyone, you know, when you've got that sense of ownership and buy in, you know, and it feeds into your organizational philosophy, your ambition, your actual core and DNA, effectively, it becomes who you are. This is expanding beyond ESG with a box around it. It is cultural transformation. Absolutely. And any cultural transformation really requires strong leadership, and it will require a very deliberate plan. We don't just send out some emails and hope people read them. This is tangible action. This is repeating messages. This is strong leadership to make sure it sinks in over time. Have you got any examples that come to mind of organizations maybe that you've worked with or that you've read about, where you've seen this cultural transformation really thrive? Yeah, there are quite a few in the commercial real estate sector, for example. I think the Crown Estate is an example of such an organization. You know, you've got British land as well that are doing great stuff in that particular space. You got Amazons. And they also created this very resounding strategy around positive places. And listen, you could speak to almost anybody across the organization. They will talk about positive places as sort of an overarching objective goal and vision of everything they want to do. If you can have people in finance, in hr, you know, all meetings, speaking the same language, that is incredible. Absolutely. Okay, so we've covered off. Successful. ESG is in part, a cultural transformation, if it isn't already embedded in your organization. Trying to scratch past that surface now and get really into the details. What are some of the actions and some of the details that organizations need to be thinking about when implementing esg? So they might have drafted the document or defined their aspiration, understood their why. Now they have to start taking tangible steps to make this part of how they do business. Have you got any advice in terms of what tangible action organizations can take? Oh, yeah, That's a good one as well, James. So I think one of the immediate outcomes you get when you develop an ESG strategy. It's a nice glossy coffee table, magazine or brochure, if you like, that tells such a beautiful, compelling narrative and story. And very quickly a lot of organizations could just rest their oars on that. I think the real world starts right after that. It's about how you start to measure your progress against the vision that you've created. And for every vision, there's gotta be tangible objectives, measures of success. How do you know that you are actually actualizing that? So those measures of success, they've got to be on the pained by very clear, specific KPIs key performance indexes, metrics, proxies and values, you know, and it has to be owned by someone. So the complexity of that needs appreciation to first of all understand what data do we need to collect and manage? How are we going to collect and manage this process, this data? And it's. It very quickly becomes proper, challenging because you find people, you know that their day job has nothing to do with any of other stuff. You might need to consider upskilling your existing workforce. You might think about sourcing, you know, bits of this. You might need to find dedicated personnel to deal with all of all this. So those are things that start to quickly precipitate beyond the initial ESG strategy and beyond that as well. Once you start to deal with the data bit of it, you got to start thinking about, are we saying the right things? How accurate is this? So the risk inherent within disclosure itself. So hence, do we need all of this verified? Do we need some limited assurance on this? Do we need some independent verification of all of all that? So those are the real, real things that start to come up really, beyond your ESG strategy. Yeah, fascinating. I'm thinking you mentioned data there. The obvious word of the week or term of term of the year, I'd say this year would be AI. And the way AI obviously just eats up data and hopefully spits out insights. Do you see a role for AI with merged with ESG as everything evolves? I think it is part of the future. It's part of the strands of where ESG will eventually get to. I haven't seen examples of organizations that have successfully implemented AI machine learning into their ESG strategies just yet. There might be some out there, but I'm not aware of them just yet. But I think AI could potentially solve a massive, massive challenge in the world of esg, which is data. Being able to collect data, to synthesize data, to analyze data, visualize it, and then of Course, to be able to spit it out in very intelligent, bite sized, actionable packages. That I believe is the future of ESG strategy and reporting. Where you go AI, enabling a very quick interpretation of life data, you know, and allowing businesses to respond a lot quicker and, and, and on, almost on the spore, if you like, on demand, if you like. Oh, there you go, on demand. ESG on demand. There you go. That's the future. You've got it on your business model. So I think it's the future. And that could be enabled by AI. ESG on demand. That's a good one. You've seen it here. First, it's one of those challenges for any organization when it comes to data. Right. We in the projects world, we talk often about trying to have the right information to allow all the project stakeholders to make the right decisions so that the project not only achieves its project goals of budget and schedule and scope, but ultimately it achieves the benefits that that project was supposed to achieve for end users. Without that data in a timely fashion, you're often waiting a month to get your monthly report, by which point the information's out of date. And ESG I'm sure, no different. It'll be interesting to see as things like the Internet of things, where everything is becoming digitized and has a sensor of some sort built in and can report. How do those sensors feed data into an ESG platform potentially like you say, giving you sort of an ESG report card on demand, instantaneous here and now. And I'm sure there's, there's organizations out there who are leading on these sorts of initiatives already. You did mention earlier that one of the challenges for organizations in implementing ESG is having the right skill sets for people, potentially having to upskill people to understand how to support esg, how to implement, how to report. Are there any specific skill sets or training that you would recommend? Yeah, I mean, absolutely. I mean there are trainings for different levels of business and organization depending on where you are, whether you are an executive or whether you are a consultant, you know, or a project officer or practitioner. Yeah, basically. So I, I would recommend for an entire organization there should be a rule out of them as a minimum carbon literacy training, for example, because that basically helps people to appreciate the climate emergency and how it translates to the language of carbon. Right. How operations can be translated to carbon, which is a key metric, you know, for reporting organizational impact from a sustainability lens. But we know it's not just all about carbon, you know, it's not just carbon that There are a few other layers associated with it, but it's a great place to start across an organization. If you have that goal to get everybody covered literally in your business, that immediately quickly starts to create embedded awareness and understanding of key sustainability issues and impacts. Right. And people can start to really visualize and become very conscious of the impact of their decisions on their job, the impact of the decisions they make, even in their personal life. And I think for executives, it might be nice to just to step that up, you know, for example, you got the Cambridge Institute of Sustainability Learning cisl, where you could have leadership and sustainability courses to follow, add, you know, certain skills and understanding, you know, in terms of sustainability and esg. There is a supply chain sustainability school, sdss. I think they got a suite of training modules which I think I would recommend for any business to sort of get involved with, you know, and if, if either of those are a bit too much or unattainable or reachable, if you're a small organization, they can speak to a consultant and that can come in and, you know, create bespoke or tailored, you know, training modules that are perhaps more appropriate for your organization. Yeah. Size appropriate. Yeah, yeah. Okay. There's some good advice in there. You did start touching on carbon being one piece of a big puzzle and obviously plays a big part in sustainability, though. Is there anything thinking across environment, social and governance, how do you package that in your head? I guess, are they three separate boxes or is it one big box labeled esg? That's a very, very good question, James. So I think I like to tell people that ESG is not spelled esg. It's not quite just that. It's so much more broader. And for all I care, ESG could be any mix of alphabets, could be xyg, you know, whatever you want to call it. Like I said at the beginning of this conversation is ESG is effectively a proxy for sustainability. And sustainability really is about purpose and outcomes. It's about needs of the present, needs of the future generations. It's about understanding our environmental limits. It's about embracing our social purpose. And the key word there is stewardship. Right. And levering, measurable, you know, tangible, made to measure benefits as a business and an organization. Benefits to yourself, to your staff, employees, your stakeholders, to your local communities, to society and to the planet as a whole. So for me, ESG really is around delivering long term value, or capitals, if you like. So you're talking about human capital, social capital, natural capital, physical capital, which is buildings, infrastructures, and all the Things that supports that and of course, economic capital. So it's, it's how you slice and dice that, you know, is completely up to you. But ESG is a lot of product than just the esmj. It's not just one box. It's tetrahedral, you know, it's multifaceted, you know, and you got to embrace that. You got to understand and appreciate that. You know, you can try and make it as simple as possible for you to be able to digest and interact with it. Right. But prepared to build on that, you know, year on year. Like I said, every organization needs to start from where they are. You know, you take on too much too soon, you might fall into the, the trap of paralysis. But ESG is almost like a living organism. You know, wherever you start from, it will start to grow. You start to peel layers, there will be layers on it, you know, environmental. You know, when we talk about carbon, people are thinking about energy, but it's not just energy. There's water as well, you know, and we've heard lots of narratives, you know, and lots of people, top pieces, saying water could be the next carbon going forward. You know, I mean, it could be something that could instigate or trigger, you know, you know, serious conflicts, geopolitical zones, you know, you know, as it were. Because only 1% of the entire, you know, water body, you know, on Earth is actually potable and drinkable. And with probabilistic weather scenarios, as the head warms, you know, know, in the next two, three, four decades, there's going to be increased water stress. It becomes harder to come by. It's going to be the new oil and gold, if you like. But, yeah, it's. It's so much more than just what the ESG letters might suggest. Yeah, I'm glad I asked. It's. I like the comments made about stewardship. And thinking about what we do today is, is what we know we impact the future, what we give to our children, our grandchildren. And those different types of capital you touched on, thinking about, you can, I guess, rephrase ESG across. How are you offering stewardship to the various types of capital? So, yeah, thanks for sharing that. Going beyond strategy and into implementation, are there any tools that you recommend using or that you use on a regular basis that you find makes implementation easier and potentially avoids that paralysis you mentioned? Yeah, so I think talking about tools, you know, a lot of times people's default response is to look for, you know, some software is to default to some data management platform, you know, and what have you? All of all those things are rated in the first instance. But I think the most important tool to implement an ESG strategy is often overlooked by many organizations. And the most important tool is your people. They are the most important thing. When you have champions and advocates for sustainability and ESG performance within your business at every level. People that understand the vision, people that buy into it, people that own it, people that will challenge you, people that are willing to run with it and to drive it, you've got all you need. And that comes back to it's a change management exercise. It's about strong leadership to shift culture. And I did not expect that to be where this conversation ended up, to be honest. I thought we'd be down in talking about software or something or some great bit of monitoring technology that was adding value. But at the end of the day, like you say, it is about people have to do a job and implement things, bring about change for there to be any sort of step change in sustainability. Yeah, James, the truth is there's a lot of reliance on technology and tools and softwares and platforms and they do have their place. But I don't think we should be led by it. I think we should be enabled by it. So it has to be people, the right people in the right place doing the right things, enabled by technology to achieve the desired outcomes. Good summary. I don't think we need to say any more on that. You've summed that up quite well. So looking to the future then, and we've just said, you know, technology will enable people but won't lead us. Where do you see the future of ESG going? Is it still technology enabled or is it technology led? Is it always going to be people led? What do you think the future holds? Again? I think when we look at it and when we strip ESG and sustainability back to the barest minimum, it's about people and the planet and the interaction between those two elements. So the future will always be still about the people on this planet, how we are enabled, right, by technology to be able to drive sustainability and ESG outcomes. But it's going to be more and more of ESG becoming embedded in the business. So like I said, you know, the trends we've seen ESG sustainability becoming, you know, part of the main agenda on projects, you know, and, and in board meetings we're seeing, you know, you know, chooses thing with the offices in businesses, it's to see more and more of that being embedded in the business. So when we go to annual reports, you know, we're seeing ESG as part of the main, you know, if you like bottom lines, you know, for measuring performance, but you want to see that also being seen as a performance appraisal metric. So you're talking about appraisals, how are you performing? You know, as, as, as, as, as a practitioner, as an individual, as a consultant or an engineer. It's not just about, you know, how much work have you won this month? You know, how much, how many projects did you deliver on time? What about a social value of what you delivered? You know, what is the sustainability outcomes that's been, you know, seen it further embedded, truly part of the DNA of the business that makes sense. And again, I'm sure there's organizations out there that are really embracing that and leading on that. The role of the Chief Sustainability Officer, do you see that evolving or becoming potentially more significant? I'm going to be a bit biased on this one. I have seen lots of conversations and chatter saying the future CEOs are going to be the people from the finance accounts and legal backgrounds. But I like to see the future CEOs being the previous CSOs, companies being led from sustainability minded professionals because you're not biased to just legal compliance or you're not biased to financial commercial performance, but you got a rounded interest to see a holistic performance for people, for planet, for society, across the board. I think the role of future CSOs, CEO, yeah, I think you've got something there. I think there's absolutely a future and I'm sure There's some aspiring CSOs out there who are gunning for those gigs. I've got a few names in the back of my mind already. Maybe play some bets now just to wrap up then. Do you have a call to action? If someone's out there battling with ESG or trying to implement it, trying to get it moving in their organization, potentially maybe trying to work it into or evolve it from a box ticking exercise into that ambition of being part of their DNA. Any inspiration or a call to action to bring people to the cause? Definitely. James. I think I like to borrow a mantra from Tesco. Every little matters. When I talk to a lot of people around ESG and sustainability, one of the things I hear is it doesn't matter what I do, my contribution is not really that significant. Actually it is. And I think everybody's action matters. Your decision doesn't end with you. Your decision can impact generations. Your decision can start, you know, if you like, or catalyze a ripple effect or domino's effect if you like. All right. So therefore every single action matters. You as a business, you as an individual, your decision to be a bit more sustainable, your decision to, to think, you know, beyond just now, you know, to think more long term is significant and therefore do not minimize what that is. And in order to put you in a very strong position. Get advice. Don't make assumptions. Speak to the right people. Don't go cheap on this, especially if you're in business. Sometimes what you pay for is what you get. Get sound, credible advice to navigate the complexity of the regulatory landscape that ESG and sustainability has become. It will help you move pretty quickly, you know, from A to B and with clarity and assurance, you know that you are doing the right thing. So yes, your contribution matters, your action, your decisions is significant. Get the right advice. Speak to seasoned professionals and organizations that know what they are doing and they can help you accelerate to sort of the sustainability sort of outcomes you really need. Want. That's a fantastic message to finish on. Thank you. I really like that. I'll take that away personally as well, to think about what I'm doing to make a difference. So Tunde, thank you again for joining us. Thank you for sharing your thoughts and we'll see you on the other side. Thanks very much. Thank you very much, James. It's been a pleasure. The Building Sustainably Podcast is brought to you by rps. To find out more about RPS and how we can help you deliver future ready development, visit rpsgroup.com and then search for the Building Sustainably Podcast in Apple Podcasts, Spotify and wherever else you get your podcasts. Make sure to click subscribe so you don't miss any future episodes. On behalf of the team here at rps, thanks for listening.