Sustainability through Engagement, Empowerment, & Mobilisation
Entity-level systemic change:
It will be deployed directly for leading FIs and Large & Medium corporates and indirectly for Small and Micro enterprises. It will enable them to innovate at scale and rapidly scale them up with multi-stakeholder focus. These innovations are in sustainable finance and in products and services in sectors like energy, steel, cement, aviation, industrialised food production etc, extended to their supply chains. It will lead to their longterm sustainability, their just & resilient netZero transition at the pace they must, achieve their fair share of direct/indirect climate goals and all other SDGs by 2030, and finally enable corporates to avail and FIs to provide sustainable finance at scale and speed including in EMDEs mobilising private capital.
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At the core, this entity-level systemic change is based on the concept of their long-term sustainability. An entity becomes so when it contributes directly or indirectly towards the bigger ecosystem it is a part of. It has an outward look, not just inward. It is multi-stakeholder focused, that is to say, it contributes towards its customers, employees, suppliers, environment, society, and, of course, its shareholders directly or indirectly. The positive presence of such an entity is felt by the ecosystem and it becomes robust and thereby sustainable for the long term. These non-financial outcomes do not come from a profit mindset but the entities having a purpose, a higher purpose beyond just making a profit. The std. Transformation Methodology CTM (Change thru Movement) embodies these concepts and includes a design to make its dir/indirect impacts objective and measurable, leading to the deployment and disclosure of universal ESG metrics with comparable sustainability performance for these entities.The comparability of their sustainability performance will also require verification by independent third parties.
So, how does this entity-level systemic change gets deployed?
It is done through two mechanisms -
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First - the standardised just & resilient NetZero Transition Plans, which are nothing but the standardised Project Plans with variations for the leading FIs and real-economy large corporations to deploy the standardised Transformation Methodology (CTM) Change thru Movement with its two halves the Movement and the Objectivity. The Movement includes Purpose, shifting mindset and culture, innovation at scale, a constant pipeline of self-initiated impactful projects and their non-financial outcomes, and qualitative measurements embedded in it that become the qualitative part of universal ESG metrics. The other half brings more objectivity into it leading to the disclosure of universal ESG metrics (quantitative) that can solve the problem of Greenwashing. It is designed through the entity's governance framework for its self-initiated Projects' and their non-financial outcomes', entities’ periodic relative focus across 16 SDGs - their ideal, actual and targeted values, entities’ periodic focus on their standardised sectoral impact parameters - their baselines (directly/as-financed) and targets in alignment with their sectoral pathways (directly/as-financed), and the mechanisms for universal ESG metrics. CTM has provisions to incorporate requirements, recommendations and guidelines from regulators, standard setters, emerging thought leaderships etc while leveraging technology directly or through potential partners.
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Secondly, when it is a corporate and investment bank and others of the like, the other mechanism is the regTech product CBD (Compliance by Design) for these banks with reusable features accessible to anyone, that further enables them to deliver towards their purpose more powerfully. The technology part of it sits outside of the Std. just & resilient NZ Transition Plans while a part of CTM stays with the above mentioned transition plans which is used for its deployment. The application solves their challenges in complying with regulations, solves their core issues of data silo, measures credit and compliance risk more accurately and discretely at each transaction level that can be rolled-up to any level and finally to the bank's balance sheet level, integrates corporates' universal ESG data alongside their financials and others in measuring their creditworthiness, brings more agility in banks' response to its own business requirements, creates a bank-wide MIS etc. and thereby makes the banks more robust, clean, purposeful and sustainable for the long term.Further to this, its re-usable features around holistic ratings and quantified underwritings are accessible to anyone.It can enable asset managers also finance MSMEs at scale and speed in EMDEs and anywhere else with drastically reduced cost and enhanced efficiency in underwriting activities.
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