Environmental, social, and governance (ESG) issues are becoming more mainstream, and they now directly impact our daily lives. Whether we realise it or not, we now live in a fast-paced world, and technology is evolving faster than ever.
With that in mind, Smart Investor speaks with Rami Hajjar, Chief Executive Officer of Signify Southeast Asia, to understand the ESG agenda. Signify is the world leader in lighting for professionals and consumers, as well as lighting for the Internet of Things. Their energy-efficient lighting products, systems, and services give their customers a better quality of light and make people’s lives safer and more comfortable, businesses more productive, and cities easier to live in.
Read: All You Need To Know About ESG And ESG Benefits
Smart Investor: What does ESG mean to you? Why is it essential to your business, and how does the ESG agenda impact your industry?
Rami Hajjar: ESG is about carrying out business in a way that is respectful to people and the planet and about generating profits ethically. This is important to ensure that businesses can carry out their operations sustainably. The ESG agenda is important for putting it into business because it gives us a way to hold ourselves accountable for managing our company’s impact, especially our carbon footprint.
Regarding the lighting industry, it is safe to say that the E [environmental] plays a crucial role. It covers the organisation’s energy usage, pollution, waste, and conservation efforts. The key ESG strategy is an environmentally friendly and cost-efficient LED lighting retrofit. LED products are recyclable, unlike most other types of lighting. Businesses also see a reduction in lighting maintenance costs and energy usage.
With the current energy crisis caused by various economic factors, including the rapid post-pandemic economic rebound that outpaced the energy supply, LED lighting solutions allow consumers to be more energy efficient and save cost due to their long-lasting durability at the same time, contributing to a greener planet.
Read: The Islamic Sustainability Approach In ESG
SI: How successful is the ESG agenda deployment in your organisation, and what challenges are you facing?
RH: At Signify, I am proud to say that since September 2020, we have been 100% carbon neutral in our operations and use 100% renewable electricity. In the same year, Signify reached our commitment to send zero manufacturing waste to landfills for our manufacturing sites and recycle up to 91% of our manufacturing waste.
On September 8, 2020, Signify also launched Brighter Lives, Better World 2025, a new five-year plan that enables us to double our positive impact to brighten lives for a better world. With our new programme, we’ve set more challenging goals and promised to make our entire value chain more environmentally friendly.
For instance, we are going beyond carbon neutrality. We aim to double the pace of the Paris Agreement’s 1.5°C scenario to reduce greenhouse gas (GHG) emissions over our entire value chain by the end of 2025. We will do so by increasing our portfolio’s energy efficiency, reducing our customers’ emissions, and driving carbon reduction at our suppliers.
Read: ESG Investing And The 3 Steps To Build An ESG Portfolio
SI: How has the ESG agenda changed the lighting landscape?
RH: Over the past 125 years, Signify has pioneered many key breakthroughs in sustainable lighting, being a driving force behind several leading technological innovations, including LED. Approximately 13% of the world’s electricity is used for lighting.
Through digital LED technology, Signify offers up to 80% more energy-efficient light. With it, electricity usage for lighting will decline to 8% by 2030. Through our leading position in the lighting industry, we believe we have an essential role to play towards a low-carbon economy as the world transitions from conventional to LED lighting technology.
Read: ESG Investing – How To Integrate It Into Your Investment Planning?
SI: How do you run your business sustainably?
RH: At Signify, we pride ourselves on taking the lead in ESG efforts. We believe in sustainability at Signify and want to build a better world. Our organisation did not wait for the ESG landscape to impact us; we took the lead through our technology and innovations.
We also have policies and due diligence processes in place and have been recognised as leaders in DJSI, Sustainalytics, and EcoVadis. This allowed us to transform the industry for a better world and brighter lives.
Read: How Technology And ESG Making The World A Better Place
SI: What are ESG trends to look out for?
RH: Climate change is the most important topic that has been gaining traction in the past ten years. It is evident from the World Economic Forum’s Global Risk Report that worsening climate change impacts and extreme weather conditions dictate global risk factors. Besides, social factors such as the livelihood crises of the B40 group have also gained a strong pull for ESG in Malaysia.
In 2023, we can expect other areas of the environmental pillar to grow, such as the carbon market, carbon tax, and carbon offsetting, which involves carbon capture, storage, and sequestration activities.
Read: 4 Things That You Should Know About ESG In Malaysia
ESG Agenda Will Drive The Way We Live Our Lives
All said and done, we must accept that the ESG agenda will impact our daily lives. At home, at work, at school, wherever we are and whatever we will do. Let’s pray that humankind will unite for our planet’s and future generations’ greater good.
